VA Spends $1.3 Billion to Make Electronic Claims System ‘Partially Effective’

Inspector general finds VA wasted money, failed to train personnel

September 16, 2015

The Department of Veterans Affairs spent $1.3 billion to render its electronic claims system "partially effective," a new VA inspector general report finds.

The estimated spending by the Veterans Benefits Administration to fix the Veterans Benefits Management System (VBMS) represented a more than 120 percent increase over the initial price tag for streamlining the electronic claims process.

Still, the inspector general concluded that the VBMS is still "not a fully functioning application."

The report released Monday assessed the VA's effort to eliminate backlogs and improve accuracy in processing claims. It followed a February 2013 inspector general report that concluded the agency did not offer "reasonable assurance" it would meet goals eliminating backlogs and improving accuracy by 2015.

According to the new report, estimated costs for VBMS development increased from approximately $579.2 million to $1.3 billion between September 2009 and January 2015.

The 122-percent increase stemmed from "inadequate cost control, unplanned changes in system and business requirements, and inefficient contracting practices."

The VA did not make cost control a "foremost objective" of the system development process, the inspector general concluded.

"[Veterans Benefits Administration] and [Office of Information Technology] must acknowledge there is no ‘blank check’ and begin to exercise cost control, sound financial stewardship, and discipline in VBMS development," the report recommended.

The VA also did not prioritize training individuals using the electronic system to process claims, which in turn produced continued "shortfalls" in VBMS performance.

"VBMS still is not a fully functioning application and needs further development before it can entirely process claims from initial application through review, rating, award, and to benefits delivery. "

And, while the VA has cited evidence of reduced backlogged claims, the report concluded that the administration lacks "sufficient performance metrics" to prove that the reduction resulted from the $1.3 billion VBMS development.

The government agency has said that it reduced the number of claims exceeding 125 days from about 557,000 in September 2012 to 251,000 in January 2015, statistics that the inspector general has previously disputed.

CEO of Concerned Veterans for America Pete Hegseth slammed the VA for "wasting tax dollars" in the wake of the report.

"The VA inspector general’s report makes clear once again that throwing more taxpayer dollars at the VA to fix the department is not the answer," Hegseth said. "It is long past time for reforms that will ensure VA officials are held accountable for wasting tax dollars and, more importantly, denying veterans access to their benefits."

Monday’s report comes on the heels of another from the VA inspector general indicating that over 300,000 individuals listed as pending in the VA healthcare enrollment system have already died.

Published under: Veterans Affairs