VA Overpaid Disabled Vets $943 Million

The Department of Veterans Affairs lost $943 million from 1993 to 2009 in overpayments to veterans who had received a 100 percent disability rating, according to an audit by the VA’s Inspector General.

The Veterans Benefits Administration failed to adequately track veterans’ health through follow-up exams to validate the 100 percent rating. Losing track of their progress resulted in thousands of veterans receiving payments that the VA later determined they should not have received.

The House Veterans Affairs Committee’s disability assistance panel held a hearing Tuesday on Capitol Hill to discuss to overpayments that were overseen by the Veterans Benefits Administration.

Linda Halliday, VA assistant inspector general for audits and evaluations, told the subcommittee that her office determined that VBA regional staff “did not correctly process claims for about 27,500 veterans with 100 percent ratings and that since January 1993 VBA had overpaid these veterans a net amount of about $943 million.”

The IG projected that unless VBA got its system under control it could expect an additional $1.1 billion in overpayments between now and 2016.

Halliday noted that VBA considered the IG’s analysis flawed but did accept several recommendations it made including the plan to conduct a review of all temporary 100 percent disability evaluations to make sure each has a follow-up exam date in his or her electronic record.

But she said VBA did not begin the review until September 2011, and then pushed back the deadline for it to be completed several times, finally settling on Dec. 31, 2012.

“We have not tested the system modifications, so we have no assurance they’ve resulted in systemwide corrections,” she said.

VBA officials need to embrace a fully electronic system for scheduling exams and follow-up exams for veterans awarded temporary 100 percent disability, Rick Weidman, executive director of Vietnam Veterans of America, told the panel.

The Vietnam Veterans of America is urging the agency to get as many human beings out of the system as possible.

“Automate what you can and avoid a lot of heartache,” Weidman said on Tuesday. “Concentrate on where you need the human factor brought in.”

Congress typically chastises VA leaders for not delivering support and payments to disabled veterans fast enough. Weidman emphasized that he’d rather see veterans overpaid rather than not paid in a timely fashion.

“People don’t have the resources to pay it back,” he said. “They have to either take it out of the monies which will be much less than 100 percent … and it leaves people with a credit history that is destroyed, in some cases from which they never can recover.”

Weidman’s organization has worked with VA by reviewing three Inspector General reports on the temporary ratings and overpayments. Like other major veterans service organizations, such as the American Legion and the Veterans of Foreign Wars, VVA works with veterans in helping them file claims.

He told the House Veterans Affairs Committee panel that VVA and other organizations have been pushing for joint training with the VBA “for some time” on the claims process.

“But it has yet to happen at any level, to our knowledge,” he said. “The more complete and better organized these claims are when they are received by the [VBA] regional office staff the more quickly and accurately they can be adjudicated.”

The IG investigations that have continued to turn up evidence of human error in the system strengthens the argument for more automation in the process, he said.

Weidman said that with some tweaking the VA could set its “eBenefits” portal to automatically send out a statement each month to veterans telling them exactly what benefits they’re receiving and how much. It would also issue reminders to those on temporary 100 percent disability to keep or schedule a follow-up exam.

“The [IT] architecture is already there” to set up the system, he said.

Not only would that help VBA meet its obligation to run a smoother system, but it would be a reminder to the veteran that he has a responsibility to the process, Weidman said.

Diana Rubens, deputy undersecretary for field operations for VBA, called Weidman’s idea “terrific.”

“It goes along with the efforts we’re engaged in now … to use the eBenefits account for notification for anything to do with a claim,” she said. “And this is a perfect combination to incorporate the temporary 100 percent [disability] evaluation.”