United States General Accounting Office

GAO Testimony

Before the Subcommittee on Benefits, Committee on

Veterans’ Affairs, House of Representatives

For Release on Delivery

Expected at 9:30 a.m.

Thursday June 5, 1997

VETERANS BENEFITS

ADMINISTRATION

Focusing on Results in

Vocational Rehabilitation

and Education Programs

Statement of Cynthia M. Fagnoni,

Acting Associate Director

Veterans’ Affairs and Military Health Care Issues

Health, Education, and Human Services Division

GAO/T-HEHS-97-148

Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

Mr. Chairman and Members of the Subcommittee:

We are pleased to be here today to provide our views on the progress

made and challenges faced by the Veterans Benefits Administration (VBA)

in implementing the Government Performance and Results Act of 1993

(known as GPRA or the Results Act). Over the past several years, the

Congress has taken steps to fundamentally change the way federal

agencies go about their work, in response to management problems so

common among federal agencies that they demanded governmentwide

solutions. The Results Act was passed to require agencies to clearly define

their missions, set goals, measure performance, and report on their

accomplishments.

VBA is responsible for administering the Department of Veterans Affairs’

(VA) nonmedical programs that provide financial and other benefits to

veterans, their dependents, and survivors. These benefits include disability

compensation, pensions, rehabilitation assistance, education benefits,

home loan benefits, and insurance coverage. As requested by the

Subcommittee, my statement will focus primarily on two VBA programs:

vocational rehabilitation and counseling, and educational assistance.

These programs accounted for about $1.3 billion of VBA’s $20 billion fiscal

year 1996 appropriation. In fiscal year 1996, VBA provided vocational

rehabilitation benefits to 52,000 disabled veterans; provided educational

assistance to 397,000 veterans, reservists, and service members; and

provided education and training assistance to 41,000 dependents of

veterans. My statement will address the progress VBA has made and

challenges it faces in implementing the Results Act. The information in this

statement is based on reports we have issued in the vocational

rehabilitation area and a review of VBA’s strategic plan.

In summary, VBA has taken an important first step in implementing the

Results Act, but this process is an evolving one. To date, VBA has

developed a strategic plan with a mission and goals and has begun

consulting with the Congress and other stakeholders to obtain their views

on its plan. For the vocational rehabilitation and educational assistance

programs, VBA has identified specific goals and measures that are primarily

process oriented. While these goals and measures are important, the key

to successful implementation of the act is to focus on results. As it

continues through the planning process, VBA needs to strive to focus its

strategic plan on results, as required by the act, such as those related to

the overall purpose of these programs—to assist veterans in their

readjustment to civilian life after military service—and not merely on the

Page 1 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

process used to administer the benefits, such as the timeliness and

accuracy of claims processing. In addition, to help it achieve quality

service, VBA needs to integrate its strategic plan with VA’s overall plan and

with the plans of other key federal agencies that support veterans’ benefits

programs, such as the Department of Defense, the Department of

Education’s state vocational rehabilitation and Student Financial

Assistance programs, and the Department of Labor’s Veterans’

Employment and Training Service. Down the road, VBA will also need to

ensure that it effectively measures and assesses its performance, as

mandated by the act, to determine how well its programs are meeting their

goals and making improvements. VBA is aware of the need to focus on

results and is currently working through this process.

Background Under the Results Act, every major federal agency must now ask itself

some basic questions: What is our mission? What are our goals and how

will we achieve them? How can we measure our performance? How will

we use that information to make improvements? The act forces a shift in

the focus of federal agencies away from such traditional concerns as

staffing and activity levels and toward a single overriding issue—results.

The act requires agencies to set goals, measure performance, and report

on their accomplishments. VBA’s vocational rehabilitation and counseling

and educational assistance programs are in the process of implementing

the Results Act’s requirements.

Purpose and Requirements

of the Results Act

The Results Act is the centerpiece of a statutory framework provided by

recent legislation to bring needed improvements to federal agencies’

management activities. (Other parts of the framework include the 1990

Chief Financial Officers Act, the 1995 Paperwork Reduction Act, and the

1996 Clinger-Cohen Act.) As we noted in our May 1997 testimony before

this Subcommittee,1

 the Results Act is intended to help correct a number

of management problems in federal programs. These include (1) lack of

clear agency missions; (2) fragmentation of programs among multiple

federal agencies; (3) performance measurement based on process instead

of on achieving program results; (4) lack of strategies for achieving agency

missions; and (5) inadequate information on program results and costs.

The Results Act was designed to focus federal agencies’ attention on the

results of the programs they administer—not just on program operations.

1

Veterans’ Affairs: Veterans Benefits Administration’s Progress and Challenges in Implementing GPRA

(GAO/T-HEHS-97-131, May 14, 1997).

Page 2 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

Instead of focusing on the amounts of money they spend or the size of

their workloads, agencies are expected to rethink their missions in terms

of the results they provide, develop goals based on their results-oriented

missions, develop strategies for achieving their goals, and measure actual

performance against the goals. Also, the act requires agencies to consult

with the Congress in developing their strategic plans. This gives the

Congress the opportunity to work with agencies to ensure that their

missions and goals are focused on results, consistent with the Congress’

intent in establishing programs, and reasonable in light of fiscal

constraints. The products of this consultation should be clearer guidance

to agencies on their missions and goals and better information to help the

Congress make choices among programs, consider alternative ways to

achieve results, and assess how well agencies are achieving the results the

Congress intended for programs.

The Results Act requires VA and other agencies to complete their strategic

plans by September 30, 1997. Future actions required under the act include

the following:

• Beginning in fall 1997 (for the fiscal year 1999 budget cycle), agencies will

submit an annual performance plan to the Office of Management and

Budget (OMB).

• Beginning with the fiscal year 1999 budget, OMB will include a

governmentwide performance plan in the President’s budget submission

to the Congress.

• On March 31 of each year, beginning with 2000, agencies will submit

annual performance reports, comparing their actual performance with

their goals, to the Congress and OMB.

VA Vocational

Rehabilitation and

Educational Assistance

Programs

The mission of the vocational rehabilitation and counseling program, as

stated in VBA’s strategic plan, is to provide all services and assistance

necessary to enable veterans with service-connected disabilities to achieve

maximum independence in daily living and, to the maximum extent

feasible, to become employable and to obtain and maintain suitable

employment.2

 Veterans are eligible for program services if they have a

20-percent or higher service-connected disability and they have been

determined by VA to have an employment handicap.3

 The law defines an

2

VA defines a suitable job as a position consistent with the veteran’s aptitudes, abilities, and interests.

3

Eligible veterans are assigned disability ratings ranging from 0 to 100 percent, in increments of

10 percent. The rating represents the average impairment in earning capacity resulting from

service-connected injuries or a combination of injuries.

Page 3 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

employment handicap as an impairment of a veteran’s ability to prepare

for, obtain, or retain employment consistent with his or her abilities,

aptitudes, and interests. A veteran with a 10-percent service-connected

disability also may be eligible if he or she has a serious employment

handicap. The eligibility period generally extends for 12 years, beginning

on the date of the veteran’s discharge. A veteran found eligible for services

can receive up to 48 months of benefits during the 12-year period.

The vocational rehabilitation process has five phases. In the first phase, VA

receives the veteran’s application, establishes eligibility, and schedules a

meeting with the veteran. In phase two, a counselor determines whether

the veteran has an employment handicap and, if so, the counselor and the

veteran jointly develop a rehabilitation plan.4

 The veteran then moves into

training or education (phase three), if needed, and on to employment

services (phase four) if training or education is not needed or after it is

completed. During phase four, VA and other federal and state agencies help

the veteran find a job. In phase five, the veteran is classified as

rehabilitated once he or she finds a suitable job and holds it for at least 60

days.

The mission of VA’s educational assistance program, as stated in VBA’s

strategic plan, is to provide education and training opportunities to

veterans and their dependents, assist the military services in recruiting

new members for the All-Volunteer Force, and encourage membership in

the Selected Reserve and National Guard. The vast majority of VA’s

beneficiaries receive assistance under the Montgomery G.I. Bill, which

provides financial assistance for attendance at colleges and other higher

education and training institutions. This program has two major parts:

• the Active Duty portion, which is generally for veterans who entered

active duty on or after July 1, 1985, served on active duty for at least 3

years, have honorable discharges, and have high school diplomas; and

• the Selected Reserve portion, which is generally for individuals who

agreed, on or after July 1, 1985, to begin a 6-year commitment (or extend

an existing commitment by 6 years) to serve in a reserve or National

Guard unit.

Those who are eligible for Montgomery G.I. Bill benefits have up to 10

years from the end of their active duty, or from the beginning of their

eligibility as reservists, to use their benefits. In fiscal year 1996, VA had

4

A rehabilitation plan outlines specific services to be provided to the veteran, the duration of services,

and a basis for assessing progress toward the program goal.

Page 4 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

about 383,000 Montgomery G.I. Bill beneficiaries—281,000 veterans, 16,000

service members, and 86,000 reservists. These beneficiaries accounted for

about 87 percent of all VA educational assistance beneficiaries.

Potential educational assistance beneficiaries must file initial claims with

VBA to establish their eligibility for benefits. Also, beneficiaries file

supplemental claims to request changes in their education and training

programs; for example, to change educational institutions or to extend the

time period of training programs. Of the 1.2 million educational assistance

claims processed by VBA in fiscal year 1996, about 167,000 (14 percent)

were initial claims.

VBA’s Implementation

of the Results Act Is

Evolving

In implementing the Results Act, VBA’s planning process has been evolving.

VBA first developed a strategic plan in December 1994 covering fiscal years

1996-2001. The plan laid out VBA’s mission, strategic vision, and goals. For

example, the vocational rehabilitation and counseling goal was to enable

veterans with service-connected disabilities to become employable and to

obtain and maintain suitable employment. The educational assistance goal

was to help provide education and training that would aid veterans,

reservists, National Guard members, and veterans’ dependents in their

readjustment to civilian life, and to help develop a more highly educated

and productive workforce. In addition, a goal of both programs was to

treat beneficiaries in a courteous, responsive, and timely manner.

However, as VA’s Inspector General noted, VBA’s plan did not include

specific program objectives and performance measures that could be used

to measure VBA’s progress in achieving its goals.5

In 1995, VBA established a new Results Act strategic planning process that

included business process reengineering.6 VBA began developing five

“business line” plans corresponding with its major program areas:

compensation and pension, educational assistance, loan guaranty,

vocational rehabilitation and counseling, and insurance. Each business

line plan supplements the overall VBA strategic plan by specifying program

goals that are tied to VBA’s overall goals. Also, each business line plan

identifies performance measures that VBA intends to use to track its

progress in meeting each plan’s goals.

5

Office of the Inspector General, Review of the Implementation of VBA’s Strategic Plan and

Performance Measurements, 5R1-B18-100 (Washington, D.C.: VA, Aug. 25, 1995).

6

Business processing reengineering (BPR) is a systematic, disciplined approach for achieving

dramatic, measurable performance improvements by fundamentally reexamining, rethinking, and

redesigning the processes that an organization uses to carry out its mission. VBA began BPR with its

compensation and pension program in October 1995.

Page 5 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

VBA’s vocational rehabilitation plan has four goals:

• Identify the level of satisfaction customers have with the services VBA

provides and begin setting improvement targets.

• Increase the relative number of vocational rehabilitation program

participants who successfully complete their programs.

• Ensure all employees have the skills needed for their positions in order to

maintain a highly skilled, motivated, and adaptable workforce.

• Develop a management tool to identify the cost of delivering vocational

rehabilitation benefits.

Three of these goals are oriented toward improving the efficiency of

rehabilitating clients and improving customer satisfaction with

rehabilitation services. The second goal, which addresses participants

completing their plan of services, attempts to measure program outcomes.

Performance measures that VBA has identified to determine its progress in

achieving the vocational rehabilitation plan’s goals include

• the percentage of individuals who file claims for benefits but then fail to

pursue their claims;

• the average number of days required to complete the processing of

veterans’ claims for vocational rehabilitation benefits and to notify the

claimants;

• the percentage of veterans who are found to be entitled to rehabilitation

services and then go on to develop their rehabilitation plans; and

• the percentage of veterans who become employable (complete the training

phase and enter the employment services phase of their plans) and then go

on to acquire and maintain suitable employment.

Similarly, the four goals for the educational assistance program are

oriented toward the timeliness and accuracy of claims processing, and

beneficiaries’ satisfaction with VBA’s services. These goals are to

• identify the level of customer satisfaction with VBA’s educational services

and benefits and begin setting improvement targets;

• improve payment and service accuracy and claims processing timeliness;

• implement an enhanced training program for the VBA staff responsible for

administering the educational assistance program; and

• develop a management tool to identify the cost of administering the

educational assistance program.

Page 6 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

Performance measures that VBA has identified to track its progress in

achieving the educational assistance plan’s goals include

• the percentage of eligible veterans, service members, and reservists who

are using their Montgomery G.I. Bill educational benefits;

• the percentage of the time VBA determines the correct amounts of

educational assistance payments;

• the average number of days required to complete the processing of

educational assistance claims; and

• the average administrative cost per program participant.

Challenges VBA Faces As VBA continues its process of implementing the Results Act, it faces

some difficult challenges. If the full intent of the act is to be achieved, VBA

will need to develop a strategic plan with a clear mission, goals, and

performance measures that are truly results oriented. In addition, VBA will

need to integrate its strategic plan with those of other VA programs and

other federal agencies to ensure quality service, since VBA is not the only

agency providing veterans’ benefits. Furthermore, VBA will need to

effectively measure and assess its performance to fully complete the

process that the Results Act mandates for improving federal programs.

Focusing on Results VBA has identified specific goals and measures in its current strategic plan,

but again, they tend to be process oriented. While these goals and

measures are important, they do not reflect program results. For example,

the purpose of the vocational rehabilitation and counseling program is to

provide eligible service-disabled veterans with services and assistance to

help them become employable and to obtain and maintain suitable

employment. Given this program purpose, results-oriented goals would

focus, for example, on issues such as how well the program assisted

disabled veterans in overcoming their employment handicaps to obtain

and maintain employment consistent with their abilities, aptitudes, and

interests. VBA’s current strategic plan measures veterans’ progress in

completing each rehabilitation phase. However, it does not provide an

assessment of the program’s overall effectiveness.

Similarly, one purpose of VBA’s educational assistance program is to

extend the benefits of a higher education to qualifying men and women

who might not otherwise be able to afford such an education. A

results-oriented goal would focus on issues such as whether the program

Page 7 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

indeed provided the education that the veteran could otherwise not have

obtained. VBA has not yet tackled these types of difficult questions and will

need to do so in consultation with the Congress in order to develop a truly

results-oriented strategic plan.

VBA is aware that it needs to focus more on its benefits programs’

outcomes for veterans rather than only on the process used to administer

the benefits. In its fiscal year 1998 budget submission, VBA stated that,

historically, VA has engaged in little policy or program analysis of its

benefits programs and that this work is needed if the intended results of

the act are to be fully achieved. VBA acknowledges that additional data and

research will be required, including formal program evaluations and

extensive consultation with stakeholders.

Integrating Strategic Plans As VBA continues its strategic planning, it will need to integrate its plan

with those of the rest of VA and those of other federal and state agencies

that support veterans’ benefits programs. For example, our work has

shown that

• state vocational rehabilitation agencies, the Department of Labor, and

private employment agencies also help veterans find employment once

they have acquired all of the skills to become employable;

• VA has contracted for quality reviews of higher education and training

institutions that have already been reviewed by the Department of

Education;7

 and

• VBA relies on the Department of Defense for information about veterans’

military service, including their medical conditions, to help determine

eligibility for vocational rehabilitation and educational assistance

programs.

VBA will need to determine what impact these other entities will have on

the success of VBA’s performance.

Currently, VA is in the process of developing a departmentwide strategic

plan and VBA is participating in this effort. In addition, VA has initiatives

under way to improve its information exchange with the Department of

Defense. For example, VBA plans, in coordination with the Department of

Defense, to improve the dissemination of information on Montgomery G.I.

Bill benefits to active duty service members who have elected to

7

VA Student Financial Aid: Opportunity to Reduce Overlap in Approving Education and Training

Programs (GAO/HEHS-96-22, Oct. 30, 1995).

Page 8 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

participate in the program.8 Participants would receive a letter outlining

their benefits and the requirements for maintaining their eligibility.

Furthermore, as we recently testified before this Subcommittee, the

Department of Labor’s Veterans’ Employment and Training Service has

developed a draft strategic plan and performance measures.9 VBA will need

to continue to coordinate with these agencies that are critical to veterans’

benefits programs to ensure overall high-quality service to veterans.

Measuring and Assessing

Performance

Once VBA has identified results-oriented goals, it will need to effectively

measure and assess its performance. As mandated by the Results Act,

federal agencies must link their performance measures to their fiscal year

1999 budget requests, which are to be submitted to OMB this fall. Agencies

are also to submit their performance plans to the Congress after the

President submits his fiscal year 1999 budget in early 1998. Federal

agencies are expected to limit their performance measures to a few that

• best demonstrate how an agency’s goals are met;

• allow agency managers to balance quality, costs, customer satisfaction,

stakeholder concerns, and other matters; and

• are linked directly to the offices in each agency that are directly

responsible for making programs work.

The Congress, in enacting the Results Act, recognized that measuring the

results of many federal programs will be difficult and, consequently,

permitted the act to be phased in over several years. Measuring results will

be a challenge because the link between program operations and results

can be difficult to establish. Also, a result may occur years after an agency

has completed a task (for example, awarding a research grant).

Nevertheless, agencies such as VBA are expected to use the performance

and cost data they collect to continuously improve their operations,

identify gaps between their performance and their performance goals, and

develop plans for closing performance gaps. As a result, appropriate

performance measures and adequate and reliable performance and cost

data will be needed to effectively measure and assess VBA performance.

8

Upon entering military service, recruits can agree to have their pay reduced by $100 per month for 1

year to establish their eligibility for Montgomery G.I. Bill benefits.

9

Veterans’ Employment and Training Service: Focusing on Program Results to Improve Agency

Performance (GAO/T-HEHS-97-129, May 7, 1997).

Page 9 GAO/T-HEHS-97-148
Veterans Benefits Administration: Focusing

on Results in Vocational Rehabilitation and

Education Programs

Mr. Chairman, this completes my testimony this morning. I would be

pleased to respond to any questions you or Members of the Subcommittee

may have.

(105753) Page 10 GAO/T-HEHS-97-148
Ordering Information

The first copy of each GAO report and testimony is free.

Additional copies are $2 each. Orders should be sent to the

following address, accompanied by a check or money order

made out to the Superintendent of Documents, when

necessary. VISA and MasterCard credit cards are accepted, also.

Orders for 100 or more copies to be mailed to a single address

are discounted 25 percent.

Orders by mail:

U.S. General Accounting Office

P.O. Box 6015

Gaithersburg, MD 20884-6015

or visit:

Room 1100

700 4th St. NW (corner of 4th and G Sts. NW)

U.S. General Accounting Office

Washington, DC

Orders may also be placed by calling (202) 512-6000 

or by using fax number (301) 258-4066, or TDD (301) 413-0006.

Each day, GAO issues a list of newly available reports and

testimony. To receive facsimile copies of the daily list or any

list from the past 30 days, please call (202) 512-6000 using a

touchtone phone. A recorded menu will provide information on

how to obtain these lists.

For information on how to access GAO reports on the INTERNET,

send an e-mail message with "info" in the body to:

info@www.gao.gov

or visit GAO’s World Wide Web Home Page at:

http://www.gao.gov

PRINTED ON RECYCLED PAPER
United States

General Accounting Office

Washington, D.C. 20548-0001

Official Business

Penalty for Private Use $300

Address Correction Requested

Bulk Rate

Postage & Fees Paid

GAO

Permit No. G100