United States Government Accountability Office

GAO Testimony 

Before the Subcommittee on Disability 

Assistance and Memorial Affairs, Committee 

on Veterans’ Affairs, House of Representatives 

VETERANS’ BENEFITS 

Improvements Needed in 

VA’s Training and 

Performance Management 

Systems 

Statement of Daniel Bertoni, Director 

Education, Workforce, and Income Security 

For Release on Delivery

Expected at 10:00 a.m. EDT 

Thursday, September 18, 2008 

 

GAO-08-1126T 
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

September 2008

VETERANS’ BENEFITS

Improvements Needed in VA’s Training and 

Performance Management Systems

Highlights of GAO-08-1126T, a testimony 

to Subcommittee on Disability Assistance 

and Memorial Affairs, Committee on 

Veterans' Affairs, House of 

Representatives 

The Department of Veterans

Affairs’ (VA) disability claims 

process has long been a subject of 

concern because of long waits for 

decisions and large backlogs of 

claims pending decisions. To 

address these issues, VA has hired 

almost 3,000 new claims 

processors since January 2007. 

However, adequate training and 

performance management are 

essential to developing highly

competent disability claims 

processors and ensuring that

experienced staff maintain the 

skills needed to issue timely, 

accurate, and consistent decisions. 

The Subcommittee on Disability 

Assistance and Memorial Affairs, 

House Veterans’ Affairs Committee

asked GAO to present its views on 

1) VA’s training for its claims 

processors and 2) VA’s 

performance management of this

staff. This statement is based on a 

May 2008 report on VA’s training 

and performance management

(GAO-08-561) and has been

updated as appropriate. 

What GAO Recommends

In its May report, GAO 

recommended that VA collect 

feedback from staff on the training 

provided in the regional offices and 

use this feedback to improve

training; hold staff accountable for 

meeting their training requirement; 

and assess, and if necessary adjust

its process for placing staff in 

overall performance categories. VA

concurred with these 

recommendations, but has not yet 

reported any significant progress in 

implementing them. 

Training for VA disability claims processors complies with some accepted

training practices, but VA does not adequately evaluate its training and 

may have opportunities to improve training design and implementation. 

VA has a highly structured, three-phase training program for new staff and 

an 80-hour annual training requirement for all staff. GAO found that VA 

has taken steps to plan this training strategically and that its training 

program for new staff appears well-designed and conforms to adult 

learning principles. However, while VA collects some feedback on 

training for new staff, it does not collect feedback on all the training 

conducted at its regional offices. Moreover, both new and experienced 

staff reported problems with their training. Some new staff told us a 

computer-based learning tool is too theoretical and often out of date. 

More experienced staff said they struggled to meet the annual 80-hour 

training requirement because of workload pressures or could not always

find courses relevant given their experience level. Finally, the agency does 

not hold claims processors accountable for meeting the annual training 

requirement. 

VA’s performance management system for claims processing staff 

generally conforms to accepted practices. For example, individual 

performance measures, such as quality and productivity, are aligned with

the agency’s organizational performance measures, and VA provides staff 

with regular performance feedback. However, the system may not clearly

differentiate among staff performance levels. In each of the regional 

offices we visited, at least 90 percent of claims processors were placed in 

just two of five overall performance categories. Broad, overlapping 

performance categories may deprive managers of the information they

need to reward top performers and address performance issues, as well as 

deprive staff of the feedback they need to improve. 

Fiscal Year 2007 Appraisals for Four Offices Were Concentrated in Two Categories

Source: VBA regional offices.

Percentage

0

10

20

30

40

50

60

70

80

90

100

Unsatisfactory

Minimally satisfactory

Fully successful

Excellent

Outstanding

Atlanta Baltimore Milwaukee Portland

81

66

70

72

24

9

10 28 26

10 2 2

To view the full product, including the scope 

and methodology, click on GAO-08-1126T. 

For more information, contact Daniel Bertoni 

at (202) 512-7215 or bertonid@gao.gov. 
Mr. Chairman and Members of the Subcommittee: 

I am pleased to have the opportunity to comment on training and 

performance management for Department of Veterans Affairs’ (VA) 

disability claims processors. In fiscal year 2007, VA paid about $37.5 billion

in benefits to more than 3.6 million veterans and their families. The 

disability claims process has long been a subject of concern for VA, the 

Congress, and veterans’ service organizations due to long waits for 

decisions, large backlogs of pending claims, and problems with the 

accuracy and consistency of decisions. Moreover, we have noted that VA’s 

current disability process is in urgent need of re-examination and 

transformation, especially in regard to how it assesses the work capacity

of individuals with disabilities in today’s world and in its ability to provide 

timely and appropriate benefits. With an increase in claims resulting from 

injuries sustained in Iraq and Afghanistan and from an aging veteran 

population, these issues will likely persist. To address them, VA added 

almost 3,000 new claims processors from January 2007 to July 2008 and 

has plans to add even more staff by the end of September 2008. Earlier this 

year, I testified before this subcommittee that enlarging VA’s disability 

workforce is likely to produce certain human capital challenges for the 

agency.

1

 More staff alone will not guarantee effective disability claims 

processing. Among other things, adequate training and performance 

management are essential to developing highly competent new disability 

claims processors and ensuring that experienced staff maintain the skills 

needed to issue timely, accurate, and consistent disability decisions. 

My remarks today primarily draw from our May 2008 report for the 

Committee on Veterans’ Affairs and focus on 1) VA’s training for its 

disability claims processing staff and 2) its performance management 

system for claims processors. We conducted our work in accordance with 

generally accepted government auditing standards.2

 For this testimony, we 

updated information from our report, as appropriate, to reflect the current

status of VA training and performance management systems. 

In summary, although we found that training for VA disability claims 

processors complies with some accepted training practices, it is not 

 1

GAO, Veterans’ Disability Benefits: Claims Processing Challenges Persist, While VA

Continues to Take Steps to Address Them, GAO-08-473T (Washington, D.C.: Feb. 14, 2008).

2

GAO, Veterans’ Benefits: Increased Focus on Evaluation and Accountability Would

Enhance Training and Performance Management for Claims Processors, GAO-08-561 

(Washington, D.C.: May 27, 2008). 

Page 1 GAO-08-1126T 
adequately evaluated, and some aspects of training design and

implementation could be improved. We found that VA has taken steps to 

strategically plan its training, including the establishment of a training 

board to evaluate the agency’s training needs. Also, VA’s training program 

for new staff appears well-designed and conforms with adult learning 

principles. However, while VA collects feedback on many of the training 

methods and tools for new staff, not all the training VA conducts is 

evaluated to determine how relevant or effective it is. Moreover, both new 

and experienced staff reported problems with their training. Some new 

staff members reported that a computer-based learning tool was not 

useful. Also, VA requires 80 hours of training annually for all claims 

processors, but some experienced claims processors struggled to meet 

this requirement because of workload pressures, and some could not 

always find relevant courses. It is not clear what criteria VA uses to justify 

the number of required training hours. Furthermore, individual claims 

processors are not held accountable for meeting the annual training 

requirement, although according to VA, the agency has implemented a new 

learning management system allowing it to monitor staff’s completion of 

the training requirement. 

VA’s performance management system for claims processing staff 

generally conforms to accepted performance management practices. For 

example, individual performance measures, such as quality and 

productivity, are aligned with the agency’s organizational performance 

measures, and VA provides claims processing staff with regular feedback

on their performance. However, the system may not clearly differentiate 

among performance levels. Broad, overlapping performance categories 

may deprive managers of the information they need to reward top 

performers and address performance issues, as well as deprive staff of the 

feedback they need to improve. 

The Veterans Benefits Administration (VBA) within VA administers the 

disability compensation and pension programs, whereby VA claims 

processing staff assess veterans’ applications for disability compensation 

and pension benefits. Aside from benefits for veterans, VBA claims 

processing staff make eligibility determinations for deceased veterans’ 

spouses, children, and parents. In short, they are responsible for ensuring 

that the decisions that lead to paying disability compensation and pension 

benefits are timely, accurate, and consistent. 

Background 

The VA disability claims process involves multiple steps and usually 

involves more than one claims processor. When a veteran submits a claim 

to one of VBA’s 57 regional offices, staff in that office are responsible for 

Page 2 GAO-08-1126T 
obtaining evidence to evaluate the claim, such as medical and military 

service records; determining whether the claimant is eligible for benefits; 

and assigning a disability rating specifying the severity of each of the 

veteran’s impairments. These ratings determine the amount of benefits 

eligible veterans will receive. 

VA has faced questions about the timeliness, accuracy, and consistency of 

its disability decisions. GAO designated federal disability programs, 

including VA and other programs, as a high-risk area in 2003. In particular, 

our prior work found VA relied on outmoded criteria for determining 

program eligibility that did not fully reflect advances in medicine and 

technology or changes in the labor market. As a result, VA’s disability 

program may not recognize an individual’s full potential to work. In 

addition, VA has seen processing times for their disability claims increase 

over the past several years, and inconsistencies in disability decisions 

across locations have raised questions about fairness and integrity. 

Some have suggested that VA needs to address its training and guidance

related to claims processing in order to improve consistency and that it 

should conduct periodic evaluations of decisions to ensure the accuracy of

ratings across disability categories and regions. VA has reported that some 

of the inconsistency in its decisions is due to complex claims, such as 

those involving post-traumatic stress disorder, but it has also 

acknowledged that the accuracy and consistency of claims decisions 

needs further improvement. 

To prepare newly hired staff to perform the tasks associated with 

processing disability claims, VBA has developed a highly structured, threephase program designed to deliver standardized training. The first phase is 

designed to lay the foundation for future training by introducing new staff 

to topics such as medical terminology and the computer applications used

to process and track claims. The second provides an overview of the 

technical aspects of claims processing, including records management, 

how to review medical records, and how to interpret a medical exam. The 

third includes a combination of classroom, on-the-job, and computerbased trainings. The second and third phases in this program are designed

to both introduce new material and reinforce material from the previous 

phase. 

Training Complies 

with Some Accepted 

Practices, but VBA 

Does Not Adequately 

Evaluate Training and 

May Be Falling Short 

in Training Design and 

Implementation 

To help ensure that claims processing staff continually maintain their 

knowledge after their initial training and keep up with changing policies 

and procedures, VBA’s Compensation and Pension Service requires all 

claims processing staff to complete a minimum of 80 hours of technical 

Page 3 GAO-08-1126T 
training annually. This training requirement can be met through a mix of 

classroom instruction, electronic-based training from sources such as the 

Training and Performance Support System (TPSS), or guest lecturers. 

VBA’s regional offices have some flexibility over what courses they 

provide to their staff to help them meet the training requirement. These 

courses can cover such topics as establishing veteran status, asbestos 

claims development, and eye-vision issues. 

We found that VBA has taken some steps to strategically plan its training 

for claims processors in accordance with generally accepted training 

practices identified in our prior work.3 For example, VBA has taken steps 

to align training with the agency’s mission and goals. In 2004, VBA 

established an Employee Training and Learning Board (board) to, among 

other things, ensure that the agency’s training decisions support its 

strategic and business plans, goals, and objectives. Also, VBA has 

identified the skills and competencies needed by its claims processing 

staff by developing a decision tree and task analysis of the claims process. 

In addition, VBA has taken steps to determine the appropriate level of

investment in training and to prioritize funding. The board’s 

responsibilities include developing an annual training budget and 

recommending training initiatives to the Under Secretary of Benefits. 

Further, we found that VBA’s training program for new claims processing 

staff appears well-designed, in that it conforms to adult learning principles 

by carefully defining all pertinent terms and concepts and providing 

abundant and realistic examples of claims work. 

However, while VBA has developed a system to collect feedback from new 

claims processing staff on their training, the agency does not consistently 

collect feedback on all of the training it provides. For example, none of the 

regional offices we visited consistently collected feedback on the training 

they conduct. Without feedback on regional office training, VBA may not 

be aware of how effective all of its training tools are. 

Moreover, both new and experienced claims processing staff we 

interviewed reported some issues with their training. A number of staff 

told us the TPSS was difficult to use, often out-of-date, and too theoretical. 

Some claims processing staff with more experience reported that they 

struggled to meet the annual training requirement because of workload 

pressures or that training topics were not always relevant for staff with 

their level of experience. VBA officials reported that they have reviewed 

 3

GAO, Human Capital: A Guide for Assessing Strategic Training and Development

Efforts in the Federal Government, GAO-04-546G (Washington, D.C.: March 2004).

Page 4 GAO-08-1126T 
the 80-hour training requirement to determine if it is appropriate, but they 

could not identify the criteria or any analysis that were used to make this 

determination. Identifying the right amount of training is crucial. An overly 

burdensome training requirement may needlessly take staff away from 

essential claims processing duties, while too little training could 

contribute to processing and quality errors. 

In addition to lacking a clear process for assessing the appropriateness of 

the 80-hour training requirement, VBA also has no policy outlining 

consequences for individual staff who do not complete the requirement. 

Because it does not hold staff accountable, VBA is missing an opportunity 

to clearly convey to staff the importance of managing their time to meet 

training requirements, as well as production and accuracy goals. In fiscal 

year 2008, VBA implemented a new learning management system that 

allows it to track the training hours completed by individual staff. 

Although VBA now has the capacity to monitor staff’s completion of the 

training requirement, the agency has not indicated any specific

consequences for staff who fail to meet the requirement. 

VA’s performance management system for claims processors is consistent 

with a number of accepted practices for effective performance 

management systems in the public sector.4

 For example, the elements used 

to evaluate individual claims processors—such as quality, productivity, 

and workload management—appear to be generally aligned with VBA’s 

organizational performance measures. Aligning individual and 

organizational performance measures helps staff see the connection 

between their daily work activities and their organization’s goals and the 

importance of their roles and responsibilities in helping to achieve these 

goals. VA also requires supervisors to provide claims processors with 

regular feedback on their performance, and it has actively involved its 

employees and other stakeholders in developing its performance 

management system. 

VA’s Performance 

Management System 

Generally Conforms 

with Accepted 

Practices, but May 

Not Clearly 

Differentiate among 

Staff’s Performance 

Levels 

However, VA’s system may not be consistent with a key accepted 

practice—clear differentiation among staff performance levels. We have

previously reported that, in order to provide meaningful distinctions in 

performance for experienced staff, agencies should preferably use rating

 4

GAO, Results Oriented Cultures: Creating a Clear Linkage between Individual

Performance and Organizational Success, GAO-03-488 (Washington, D.C.: Mar. 14, 2003).

Page 5 GAO-08-1126T 
systems with four or five performance categories.

5

 If staff members’ 

ratings are concentrated in just one or two of multiple categories, the 

system may not be making meaningful distinctions in performance. 

Systems that do not make meaningful distinctions in performance fail to 

give (1) employees the constructive feedback they need to improve and (2) 

managers the information they need to reward top performers and address 

performance issues. 

VA’s performance appraisal system has the potential to clearly 

differentiate among staff performance levels. Each fiscal year, regional 

offices give their staff a rating on each individual performance element: 

exceptional, fully successful, or less than fully successful. For example, a 

staff member might be rated exceptional on quality, fully successful on 

productivity, and so forth. Some elements are considered critical elements, 

and some are considered noncritical. Staff members are then assigned to 

one of five overall performance categories, ranging from unsatisfactory to 

outstanding, based on a formula that converts a staff member’s 

combination of ratings on the individual performance elements into an 

overall performance category (see fig. 1). 

 5

GAO, Human Capital: Preliminary Observations on the Administration’s Draft 

Proposed “Working for America Act,” GAO-06-142T (Washington, D.C.: Oct. 5, 2005). 

Page 6 GAO-08-1126T 
Figure 1: VA Overall Performance Appraisal Formula 

Outstanding

Excellent

Fully successful

Unsatisfactory

Minimally 

satisfactory

Overall 

performance 

category

Ratings on 

critical 

elements

Ratings on 

noncritical 

elements

All exceptionals All exceptionals

All exceptionals

One or more fully 

successful(s), all 

others exceptionals

One or more fully 

successful(s), any 

others exceptional(s) 

All fully successfuls 

or exceptionals

All fully successfuls 

or exceptionals

One or more less 

than fully 

successful(s)

One or more less 

than fully 

successful(s)

Source: GAO analysis of VBA information.

and

and

and

and

However, there is evidence to suggest that the performance management 

system for claims processing staff may not clearly or accurately

differentiate among staff’s performance. Central office officials and 

managers in two of the four regional offices we visited said that, under the 

formula for assigning overall performance categories, it is more difficult to 

place staff in certain overall performance categories than in others—even 

if staff’s performance truly does fall within that category. These managers 

said it is especially difficult for staff to be placed in the excellent category. 

In fact, at least 90 percent of all claims processors in the regional offices 

we visited ended up in only two of the five performance categories in 

fiscal year 2007: fully successful and outstanding (see fig. 2).

Page 7 GAO-08-1126T 
Figure 2: Fiscal Year 2007 Overall Performance Ratings for Claims Processors in

Four Regional Offices Were Concentrated in the Outstanding and Fully Successful 

Categories

0

10

20

30

40

50

60

70

80

90

100

Unsatisfactory

Minimally satisfactory

Fully successful

Excellent

Outstanding

Source: VBA regional offices.

Percentage

Milwaukee

Portland

Baltimore

Atlanta

81

66

70 72

9

24 28 10 26

10 2 2

Some managers told us that there are staff whose performance is better 

than fully successful but not quite outstanding, but that under VA’s 

formula, it is difficult for these staff to be placed in the excellent category. 

To be placed in the excellent category, a staff member must be rated 

exceptional in all the critical elements and fully successful in at least one

noncritical element. However, managers told us that virtually all staff who 

are exceptional in the critical elements are also exceptional in the 

noncritical elements, and they are appropriately placed in the outstanding

category. On the other hand, if a staff member is rated fully successful on 

just one critical element, even if all other elements are rated as

exceptional, the staff member’s overall performance category falls from 

outstanding to fully successful. 

Page 8 GAO-08-1126T 
Neither VBA nor VA central office officials have examined the distribution 

of claims processing staff across the five overall performance categories.

However, VA has acknowledged that there may be an issue with its 

formula, and the agency is considering changes to its performance 

management system designed to allow for greater differentiation in 

performance. Absent additional examination of the distribution of claims

processors among overall performance categories, VA lacks a clear picture 

of whether its system is working as intended and whether any adjustments 

are needed.

In conclusion, VA appears to have recognized the importance of 

developing and maintaining high performing claims processors. It needs to 

devote more attention, however, to ensuring that its training and 

performance management systems are better aligned to equip both new 

and experienced staff to handle a burgeoning workload. Specifically, in

our May 2008 report, we recommended that VA should collect feedback 

from staff on training provided in the regional offices in order to assess 

issues such as the appropriateness of the 80-hour annual training 

requirement and the usefulness of TPSS. We also recommended that the 

agency should use information from its new learning management system 

to hold staff members accountable for meeting the training requirement. In 

addition, we recommended that VA should assess whether its performance 

management system is making meaningful distinctions in performance. In 

its comments on our May 2008 report, VA concurred with our 

recommendations, but it has not yet reported making any significant 

progress in implementing them. 

While hiring, training, and evaluating the performance of staff is essential, 

commensurate attention should be focused on reviewing and aligning

disability benefits and service outcomes to today’s world. In prior work, 

we have noted that VA and other federal disability programs must adopt a 

more modern understanding of how technology and labor market changes 

determine an individual’s eligibility for benefits, as well as the timing and 

portfolio of support services they are provided. To the extent progress is 

made in this area, effective training and performance management systems 

will be of crucial importance. Moreover, the way VA’s larger workforce is 

distributed and aligned nationwide can also significantly impact the degree 

to which it succeeds in meeting the agency’s responsibilities to veterans in 

the future. In short, VA should seize this opportunity to think more 

strategically about where to best deploy its new staff and how to develop

and maintain their skills. 

Page 9 GAO-08-1126T 
Mr. Chairman, this concludes my remarks. I would be happy to answer any 

questions that you or other members of the subcommittee may have. 

For further information, please contact Daniel Bertoni at (202) 512-7215 or

bertonid@gao.gov. Also contributing to this statement were Clarita Mrena, 

Lorin Obler, David Forgosh, and Susan Bernstein. 

GAO Contact and 

Staff 

Acknowledgments 

Page 10 GAO-08-1126T 
Veterans’ Benefits: Improved Management Would Enhance VA’s Pension 

Program. GAO-08-112. Washington, D.C.: February 14, 2008.

Veterans’ Disability Benefits: Claims Processing Challenges Persist, 

while VA Continues to Take Steps to Address Them. GAO-08-473T. 

Washington, D.C.: February 14, 2008.

Disabled Veterans’ Employment: Additional Planning, Monitoring, and 

Data Collection Efforts Would Improve Assistance. GAO-07-1020. 

Washington, D.C.: September 12, 2007. 

Veterans’ Benefits: Improvements Needed in the Reporting and Use of 

Data on the Accuracy of Disability Claims Decisions. GAO-03-1045. 

Washington, D.C.: September 30, 2003. 

Human Capital: A Guide for Assessing Strategic Training and 

Development Efforts in the Federal Government. GAO-03-893G. 

Washington, D.C.: July 2003. 

Results-Oriented Cultures: Creating a Clear Linkage between Individual 

Performance and Organizational Success. GAO-03-488. Washington D.C.: 

March 14, 2003. 

Major Management Challenges and Program Risks: Department of 

Veterans Affairs. GAO-03-110. Washington, D.C.: January 1, 2003. 

Veterans’ Benefits: Claims Processing Timeliness Performance Measures 

Could Be Improved. GAO-03-282. Washington, D.C.: December 19, 2002. 

Veterans’ Benefits: Quality Assurance for Disability Claims and Appeals 

Processing Can Be Further Improved. GAO-02-806. Washington, D.C.: 

August 16, 2002. 

Veterans’ Benefits: Training for Claims Processors Needs Evaluation. 

GAO-01-601. Washington, D.C.: May 31, 2001. 

Veterans Benefits Claims: Further Improvements Needed in ClaimsProcessing Accuracy. GAO/HEHS-99-35. Washington, D.C.: March 1, 1999. 

Page 11 GAO-08-1126T 

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