Inspection of the
 

VA Regional Office
 

New Orleans, Louisiana
 

OFFICE OF AUDITS AND EVALUATIONS

June 6, 2011 

11-00238-184 
ACRONYMS AND ABBREVIATIONS
 

COVERS Control of Veterans Records System 

NOD Notices of Disagreement 

OIG Office of Inspector General 

PTSD Post-Traumatic Stress Disorder 

RVSR Rating Veterans Service Representative 

SAO Systematic Analysis of Operations 

STAR Systematic Technical Accuracy Review 

TBI Traumatic Brain Injury 

VACOLS Veterans Appeals Control and Locator System 

VARO Veterans Affairs Regional Office 

VBA Veterans Benefits Administration 

VSC Veterans Service Center 

To Report Suspected Wrongdoing in VA Programs and Operations:
 

Telephone: 1-800-488-8244
 

E-Mail: vaoighotline@va.gov
 

(Hotline Information: http://www.va.gov/oig/contacts/hotline.asp)
 
Report Highlights: Inspection of the VA
 

Regional Office, New Orleans, Louisiana
 

Why We Did This Review 

The Benefits Inspection Division conducts 

onsite inspections at VA Regional Offices 

(VAROs) to review disability compensation 

claims processing and Veterans Service 

Center operations. 

What We Found 

The New Orleans VARO correctly 

processed herbicide exposure-related claims. 

VARO performance was generally effective 

in the following areas: processing posttraumatic stress disorder disability claims 

correctly, establishing correct dates of claim 

in the electronic record, ensuring Systematic 

Analyses of Operations were timely and 

complete, and correcting errors identified by 

the Veterans Benefit Administration 

Systematic Technical Accuracy Review 

program staff. 

However, VARO management lacked 

effective controls and accuracy in 

processing temporary 100 percent disability 

evaluations as well as traumatic brain injury 

claims. Overall, VARO staff did not 

accurately process 29 (27 percent) of the 

108 disability claims that we reviewed. 

Controls over processing Notices of 

Disagreements for appealed claims, mail 

handling, and final competency 

determinations also were not fully effective. 

What We Recommended 

We recommended New Orleans VARO 

management review all remaining temporary 

100 percent disability evaluations identified 

during our inspection to determine if 

reevaluations are required. VARO 

management also needs to implement 

controls to ensure staff establishes reminder 

notifications for the temporary 100 percent 

disability reevaluations and follow up as 

appropriate. We also recommended VARO 

management establish an additional level of 

review for traumatic brain injury rating 

decisions to ensure accurate benefit 

payments. 

Further, VARO management needs to 

strengthen controls to ensure timely 

establishment of Notices of Disagreement in 

the Veterans Appeals Control and Locator 

System and proper mail handling 

procedures, as well as implement measures 

to ensure the accuracy of final competency 

determinations. 

Agency Comments 

The VARO Director concurred with all 

recommendations. Management’s planned 

actions are responsive and we will follow up 

as required on all actions. 

BELINDA J. FINN
 

Assistant Inspector General
 

for Audits and Evaluations
 

i 
TABLE OF CONTENTS
 

Introduction......................................................................................................................................1
 

Results and Recommendations ........................................................................................................2
 

1. Disability Claims Processing ..................................................................................................2
 

2. Data Integrity ..........................................................................................................................6
 

3. Management Controls .............................................................................................................7
 

4. Workload Management...........................................................................................................8
 

5. Eligibility Determinations.....................................................................................................10
 

Appendix A VARO Profile and Scope of Inspection ............................................................13 

Appendix B VARO Director’s Comments............................................................................15 

Appendix C Inspection Summary..........................................................................................19 

Appendix D OIG Contact and Staff Acknowledgments........................................................20 

Appendix E Report Distribution ...........................................................................................21 

ii 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Objective
 

Scope of
 

Inspection
 

INTRODUCTION 

The Benefits Inspection Program is part of the Office of Inspector General’s 

(OIG) efforts to ensure our Nation’s veterans receive timely and accurate 

benefits and services. The Benefits Inspection Division contributes to 

improved management of benefits processing activities and veterans’ 

services by conducting onsite inspections at VA Regional Offices (VAROs). 

These independent inspections provide recurring oversight focused on 

disability compensation claims processing and performance of Veterans 

Service Center (VSC) operations. The objectives of the inspections are to: 

	 Evaluate how well VAROs are accomplishing their mission of providing 

veterans with access to high quality benefits and services. 

	 Determine if management controls ensure compliance with VA 

regulations and policies; assist management in achieving program goals; 

and minimize the risk of fraud, waste, and other abuses. 

	 Identify and report systemic trends in VARO operations. 

In addition to this standard coverage, inspections may examine issues or 

allegations referred by VA employees, members of Congress, or other 

stakeholders. 

In November 2010, the OIG conducted an inspection of the New Orleans 

VARO. The inspection focused on 5 protocol areas examining 

10 operational activities. The five protocol areas were disability claims 

processing, data integrity, management controls, workload management, and 

eligibility determinations. 

We reviewed 78 (12 percent) of 666 disability claims related to posttraumatic stress disorder (PTSD), traumatic brain injury (TBI), and herbicide 

exposure that the VARO completed from July through September 2010. In 

addition, we reviewed 30 (13 percent) of 226 rating decisions where VARO 

staff granted temporary 100 percent disability evaluations for at least 

18 months, generally the longest period a temporary 100 percent disability 

evaluation may be assigned under VA policy without review. 

Appendix A provides details on the VARO and the scope of our inspection. 

Appendix B provides the New Orleans VARO Director’s comments on a 

draft of this report. Appendix C provides criteria we used to evaluate each 

operational activity and a summary of our inspection results. 

VA Office of Inspector General 1 
Inspection of the VA Regional Office, New Orleans, Louisiana 

RESULTS AND RECOMMENDATIONS 

1. Disability Claims Processing 

The OIG inspection team focused on disability claims processing related to 

temporary 100 percent disability evaluations, PTSD, TBI, and herbicide 

exposure. We evaluated claims processing accuracy and its impact on 

veterans’ benefits. 

Finding 1	 VARO Staff Need to Improve Disability Claims 

Processing Accuracy 

The New Orleans VARO needs to improve the control and accuracy of 

processing temporary 100 percent disability evaluations and TBI residualrelated disability claims. VARO staff incorrectly processed 29 (27 percent) 

of the total 108 disability claims reviewed. We advised VARO management 

regarding the inaccuracies noted during our inspection and they initiated 

corrective measures to address them. 

The table below reflects the errors affecting, and those with the potential to 

affect, veterans’ benefits processed at the New Orleans VARO. 

Table Disability Claims Processing Results 

Type Reviewed 

Claims Incorrectly Processed 

Total Affecting 

Veterans’ 

Benefits 

Potential To 

Affect Veterans’ 

Benefits 

Temporary 

100 Percent Disability 

Evaluations 

30 24 9 15 

PTSD 30 2 0 2 

TBI 18 3 1 2 

Herbicide ExposureRelated Disabilities 30 0 0 0 

Total 108 29 10 19 

Temporary 

100 Percent 

Disability 

Evaluations 

Source: OIG 

VARO staff incorrectly processed 24 (80 percent) of 30 temporary 

100 percent disability evaluations we reviewed. Veterans Benefits 

Administration (VBA) policy requires a temporary 100 percent disability 

evaluation for a service-connected disability needing surgery or specific 

treatment. At the end of a mandated period of convalescence or the cessation 

VA Office of Inspector General 2 
Inspection of the VA Regional Office, New Orleans, Louisiana 

of treatment, VARO staff must request a follow-up medical examination to 

help determine whether to continue the veteran’s temporary 100 percent 

disability evaluations. 

Based on analysis of available medical evidence, 9 of the 24 processing 

inaccuracies identified affected veterans’ benefits—6 involved overpayments 

totaling $431,033 and 3 involved underpayments totaling $8,974. Examples 

of the most significant overpayment and underpayment follow: 

	 A claims file transferred to the New Orleans VARO, in May 2005, noted 

a veteran needed reexamination for prostate cancer; however, the 

examination was never scheduled. Our review of VA treatment records 

showed the prostate cancer was no longer active. As a result, an 

overpayment of $163,865 occurred over a period of 5 years and 

2 months. 

	 A Rating Veterans Service Representative (RVSR) did not grant a 

veteran special monthly compensation for a residual disability associated 

with prostate cancer. As a result, VA underpaid the veteran a total of 

$4,108 over a period of 3 years and 8 months. 

The remaining 15 of the 24 inaccuracies had the potential to affect veterans’ 

benefits. In 13 cases, we could not determine if the evaluations would have 

continued because the veterans’ claims folders did not contain the medical 

examination reports needed to reevaluate each case. In the other two cases, 

VSC staff did not establish diaries for future reevaluations. 

Delays in scheduling the examinations ranged from approximately 2 months 

to 5 years and 11 months. An average of 2 years and 9 months elapsed from 

the time staff should have scheduled the medical examinations until the date 

of our inspection—the date staff ultimately took corrective actions to obtain 

the necessary medical evidence. 

For temporary 100 percent disability evaluations, including confirmed and 

continued evaluations where rating decisions do not change a veteran’s 

payment amount, VSC staff must input suspense diaries in VBA’s electronic 

system. A suspense diary is a processing command that establishes a date 

when VSC staff must schedule a reexamination. As the diary matures, the 

electronic system generates a reminder notification alerting VSC staff to 

schedule the reexamination. 

The most frequent processing error noted in 11 (46 percent) of the 24 cases 

reviewed occurred when VSC staff did not establish suspense diaries needed 

to alert staff that VA reexaminations needed to be scheduled. The second 

most frequent processing error noted in 10 (42 percent) of the 24 cases 

VA Office of Inspector General 3 
Inspection of the VA Regional Office, New Orleans, Louisiana 

PTSD Claims 

TBI Claims 

occurred when VSC staff did not follow up on established reminder 

notifications or proposed actions to reduce benefits. 

These errors occurred because VARO management did not have a local 

policy in place to ensure VSC staff entered suspense diaries or controls in 

place to ensure staff took action on reminder notifications. Because adequate 

oversight measures were not in place, these temporary 100 percent disability 

evaluations could have continued uninterrupted over the course of the 

veterans’ lifetimes. As such, veterans did not always receive correct benefit 

payments. 

VARO staff incorrectly processed 2 (7 percent) of 30 PTSD claims. In both 

cases, RVSRs incorrectly granted service connection for PTSD without 

having required information from the examining physicians linking the 

PTSD diagnoses to the veterans’ stressful in-service events. Given the 

infrequency of these types of errors, we concluded the VARO generally 

followed VBA policy when processing PTSD claims and we made no 

recommendations for improvement in this area. 

The Department of Defense and VBA commonly define a TBI as 

traumatically induced structural injury or physiological disruption of brain 

function caused by an external force. The major residual disabilities of TBI 

fall into three main categories—physical, cognitive, and behavioral. VBA 

policy requires staff to evaluate these residual disabilities. 

VARO staff incorrectly processed 3 (17 percent) of 18 TBI claims—1 of 

these claims processing inaccuracies affected a veteran’s benefits. In this 

instance, the veteran received unwarranted benefits as the RVSR overevaluated residual disabilities related to a TBI. As a result, an overpayment 

of approximately $7,102 occurred over a period of 1 year and 4 months. 

The remaining two cases had the potential to affect veterans’ benefits. 

RVSRs incorrectly evaluated TBI-related residual disabilities using 

inadequate medical examination reports. For example in one case, the 

medical examiner did not indicate as required whether the veteran’s 

symptoms were associated with residuals of a TBI or a co-existing mental 

condition. Neither VARO staff nor we can ascertain all residual disabilities 

related to TBI without an adequate or complete medical examination. 

VARO managers acknowledged that examination reports from the VA 

Medical Centers were not always adequate for evaluating disabilities. Prior 

to our inspection, VARO managers implemented measures to reinforce 

policy and improve the quality of medical examinations provided by VA 

Medical Center staff in New Orleans. For example, the VARO Quality 

Assurance Officer provided guidance to medical center staff regarding the 

specific information required in medical reports for the VARO to make 

VA Office of Inspector General 4 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Herbicide 

Exposure-Related 

Claims 

Recommendations 

Management 

Comments 

proper disability determinations. Additionally, prior to our inspection, 

VARO managers initiated regular meetings between VARO and VA Medical 

Center staff to address issues related to the quality and timeliness of VA 

medical examinations. 

Despite efforts to improve VA examinations, RVSRs continue to use 

inadequate medical examinations to evaluate TBI-related disabilities. VARO 

staff acknowledged they understood how to identify and return inadequate 

examination reports to request additional information. RVSRs indicated they 

did not always return inadequate examinations to the VA facility for 

correction due to pressure from management to heighten productivity. As a 

result, veterans did not always receive correct benefit payments. 

In accordance with VBA policy, VARO staff correctly processed all 

30 herbicide exposure-related disability claims we reviewed. We made no 

recommendations for improvement in this area. 

1.	 We recommend the New Orleans VA Regional Office Director review 

the 196 temporary 100 percent disability evaluations identified but not 

included in our inspection sample to determine if reevaluations are 

required and take appropriate action. 

2.	 We recommend the New Orleans VA Regional Office Director 

implement controls to ensure staff establish reminder notifications for 

temporary 100 percent disability reevaluations. 

3.	 We recommend the New Orleans VA Regional Office Director 

implement controls to ensure staff take appropriate follow-up actions on 

reminder notifications for temporary 100 percent disability reevaluations. 

4.	 We recommend the New Orleans VA Regional Office Director require 

traumatic brain injury claims undergo an additional level of review (twosignatures) to ensure adequate medical examinations and accurate rating 

evaluations prior to finalizing benefit payments decisions. 

The VARO Director concurred with all recommendations for improving 

disability claims processing accuracy. The Director informed us VSC staff 

will review the 196 additional temporary 100 percent evaluations and take 

action on those that require reevaluation. Further, the VARO will follow 

VBA’s national review plan and interim guidance to ensure the staff records 

future examination diaries in the electronic record. 

In March 2011, the VSC began reviews of 15 cancelled 810 Work Items per 

month to ensure the staff is taking appropriate action on reminder 

notifications. In addition, the VSC’s quality review team began reviewing 

routine future exam actions to ensure improvements in this area. Further, the 

Director indicated the VSC would require second signatures on TBI cases for 

VA Office of Inspector General 5 
Inspection of the VA Regional Office, New Orleans, Louisiana 

OIG Response 

Effective Dates 

Dates of Claim 

Notices of 

Disagreement 

each RVSR until it demonstrates a 90 percent average quality for 10 TBI 

cases reviewed. 

Management’s comments and actions are responsive to our 

recommendations. We will monitor the implementation and effectiveness of 

VBA’s national plan for the review of temporary 100 percent disability 

evaluations. In the VARO Director’s response, she did not believe the 

recommendation to generate an award for each of these cases was necessary 

or appropriate. Though we discussed generating awards to address this issue, 

we made no recommendation to this effect. 

2. Data Integrity 

We reviewed claims folders to determine if the VARO is following VBA 

policy to establish effective dates in the electronic record. Generally, an 

effective date indicates when entitlement to a specific benefit arose. VARO 

staff followed VBA policy and correctly established effective dates for all 

108 disability claims we reviewed. As such, we made no recommendation 

for improvement in this area. 

We analyzed claims folders to determine if the VARO is following VBA 

policy to establish dates of claim in the electronic records. VBA generally 

uses a date of claim to indicate when a document arrives at a VA facility. 

VBA relies on accurate dates of claim to establish and track key performance 

measures, including the average number of days to complete a claim. VARO 

staff established an incorrect date of claim in the electronic record for 

1 (3 percent) of the 30 claims we reviewed. Generally, VARO staff followed 

VBA policy when establishing dates of claim, so we made no 

recommendation for improvement in this area. 

We reviewed claims folders to determine if VARO staff timely recorded 

Notices of Disagreement (NODs) in the Veterans Appeals Control and 

Locator System (VACOLS). An NOD is a written communication from a 

claimant expressing dissatisfaction or disagreement with a benefits decision 

and a desire to contest the decision. An NOD is the first step in the appeals 

process. 

VACOLS is a computer application that allows VARO staff to control and 

track veterans’ appeals as well as to manage the pending appeals workload. 

VBA policy states staff must create a VACOLS record within 7 days of 

receiving an NOD. Accurate and timely recording of an NOD is required to 

ensure an appeal moves through the appellate process expeditiously. 

VA Office of Inspector General 6 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Finding 2
 

Recommendation 

Management 

Comments 

OIG Response 

Systematic 

Technical 

Accuracy 

Review 

Controls Over Recording Notices of Disagreement 

Need Strengthening 

The Appeals Team did not have controls in place to ensure staff recorded 

NODs in VACOLS within VBA’s 7-day standard. Management did not 

provide adequate oversight to ensure VARO staff timely entered NODs in 

VACOLS to meet the standard. Untimely recording of NODs in VACOLS 

affects data integrity and misrepresents VARO performance. 

The VARO exceeded VBA’s 7-day standard for 9 (30 percent) of the 

30 NODs we reviewed. It took staff an average of 46 days to record these 

nine NODs in VACOLS. According to the VARO’s workload management 

plan, VARO mailroom staff properly delivered new NODs daily to the 

Appeals team. Upon receipt, management distributed the new NODs to team 

members to record in VACOLS. Management informed us, and we 

confirmed, they did not check to ensure staff recorded all NODs within 

VBA’s 7-day standard. 

Data integrity issues make it difficult for VARO and senior VBA leadership 

to accurately measure and monitor VARO performance. Further, VBA’s 

National Call Centers rely upon accurate VACOLS information to provide 

quality customer service to veterans. Unnecessary delays in controlling 

NODs affect national performance measures for NOD inventory and timely 

completion of appeals. 

5.	 We recommend the New Orleans VA Regional Office Director develop 

and implement a plan to provide adequate oversight to ensure staff timely 

enter Notices of Disagreement in the Veterans Appeals Control and 

Locator System. 

The VARO Director concurred with the recommendation and indicated 

Appeals Team supervisors will review 10 randomly selected NODs to ensure 

compliance with VBA’s 7-day standard. Management will use the results of 

these reviews to address training needs. 

Management’s comments and actions are responsive to the recommendation. 

3. Management Controls 

We assessed management controls to determine if VARO management 

adhered to VBA policy regarding correction of errors identified by VBA’s 

Systematic Technical Accuracy Review (STAR) staff. The STAR program 

is VBA’s multifaceted quality assurance program to ensure that veterans and 

other beneficiaries receive accurate and consistent compensation and pension 

benefits. VBA policy requires that VAROs take corrective action on errors 

VA Office of Inspector General 7 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Systematic 

Analysis of 

Operations 

Mailroom 

Operations 

Triage MailProcessing 

Procedures 

that STAR staff identify. In general, VARO staff followed VBA policy 

regarding the correction of STAR errors. 

VARO staff did not correct 1 (4 percent) of 28 errors identified by VBA’s 

STAR program staff from July through September 2010. In this case, VSC 

management erroneously reported to STAR staff that all corrective actions 

had been completed. We did not consider the error rate significant, so we 

made no recommendation for improvement in this area. 

We assessed if VARO management had controls in place to ensure complete 

and timely submission of Systematic Analyses of Operations (SAOs). An 

SAO is a formal analysis of a VSC organizational element or operational 

function. SAOs provide an organized means of reviewing VSC operations to 

identify existing or potential problems and propose corrective actions. 

VARO management must publish an annual SAO schedule designating the 

staff required to complete the SAOs by specific dates. 

Our analysis revealed 1 (8 percent) of the 12 mandated SAOs was not 

completed timely per the annual schedule. We did not consider the error rate 

significant, so we made no recommendation for improvement in this area. 

4. Workload Management 

We assessed controls over mailroom operations to ensure VARO staff timely 

and accurately processed incoming mail. VBA policy states staff will open, 

date stamp, and route all mail to the appropriate locations within 4–6 hours 

of receipt at the VARO. The New Orleans VARO assigns responsibility for 

mailroom activities, including processing of incoming mail, to the Support 

Services Division. VARO mailroom staff processed, date stamped, and 

delivered all VSC mail to pick-up points on a daily basis as required; 

therefore, we made no recommendations for improvement in this area. 

We assessed the VSC Triage Team’s mail processing procedures to ensure 

staff reviewed, controlled, and processed all claims-related mail in 

accordance with VBA policy. VBA policy indicates that oversight to ensure 

staff use available plans and systems is the most important part of workload 

management. It also states that effective mail management is crucial to the 

success and control of workflow within the VSC. 

VBA policy requires that staff use the Control of Veterans Records System 

(COVERS), an electronic tracking system, to track claims folders and search 

mail. VBA defines search mail as active claims-related mail waiting to be 

associated with a veteran’s claim folder. Additionally, VBA policy states 

VSC staff will route and process mail requiring action according to 

established procedures. VBA defines action mail as forms and letters 

VA Office of Inspector General 8 
Inspection of the VA Regional Office, New Orleans, Louisiana 

received from outside the VSC. Conversely, non-priority drop mail should 

consist of documents requiring no action. 

Finding 3	 Control of Triage Mail Management Procedures Need 

Strengthening 

The Triage Team did not always process and control search mail and 

non-priority drop mail according to VBA policy. This occurred because the 

Triage Team did not follow established procedures to process search mail as 

outlined in the station’s workload management plan. Additionally, the plan 

did not contain sufficient oversight measures to ensure the Triage Team 

processed non-priority drop mail correctly. Consequently, RVSRs may not 

always have all available mail in the claims file when making disability 

determinations and claimants may not always receive prompt and accurate 

benefits. 

For 12 (40 percent) of 30 pieces of search mail reviewed, staff did not 

properly use COVERS to ensure timely processing and adequate control of 

the mail. Following are examples of mail without a corresponding search in 

the electronic record. 

	 On August 9, 2010, the VARO received original service treatment 

records in conjunction with a veteran’s July 27, 2010, compensation 

claim. By the time of our inspection, approximately four months after 

receiving the service treatment records, VARO staff had not identified 

and marked these documents search mail. Because these essential 

documents were not on search, the risk increased that RVSRs would 

make disability determinations without considering all evidence 

submitted by the veterans. 

	 On October 29, 2010, the VARO received medical evidence from a 

veteran to support his pending claim. The electronic record indicated this 

medical evidence was the last piece of mail needed before moving the 

claim forward to the next processing stage. Because VARO staff did not 

place the mail on search, a 33-day delay occurred in processing this 

veteran’s claim. 

Additionally, during our inspection we observed a backlog of approximately 

2,600 pieces of mail marked as non-priority drop mail. However, our sample 

review showed that 10 (17 percent) of 60 pieces of this non-priority drop 

mail did require action. Following are examples of action mail found in nonpriority mail bins. 

	 VARO staff did not record two new benefits claims in the electronic 

record. The VARO staff was not aware of these claims until we 

identified them during our inspection. 

VA Office of Inspector General 9 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Recommendations 

Management 

Comments 

OIG Response 

Competency 

Determinations 

	 Two pieces of mail for pending claims contained date stamps with earlier 

dates of claim than shown in the electronic record. For both claims, 

veterans may have been entitled to benefits at earlier dates. 

	 One piece of mail was a veteran’s statement describing stressful inservice events to support a claim for PTSD. Because this evidence was 

not associated with the file, the RVSR prematurely denied the claim. 

VSC management acknowledged weaknesses associated with mail 

processing. The workload management plan required management and 

Triage staff to conduct monthly reviews of search mail. Interviews with staff 

confirmed that neither Triage Team staff nor management was adhering to 

the Regional Office’s workload management procedures. Additionally, the 

VSC workload management plan did not contain sufficient measures for 

management oversight of non-priority drop mail. 

6.	 We recommend the New Orleans VA Regional Office Director amend 

the workload management plan to include oversight measures for 

properly classifying action and non-priority drop mail. 

7.	 We recommend the New Orleans VA Regional Office Director develop 

an oversight mechanism to ensure staff accurately process search and 

drop mail. 

The VARO Director concurred with our recommendations for improving 

Triage mail management processes. The Director indicated the VSC updated 

the Workload Management Plan to require that Triage Team supervisors 

review pull, priority, and non-priority mail on a monthly basis. Further, 

supervisors are required to review search mail locations bi-weekly to 

determine the appropriate actions needed for search mail pending for more 

than 15 days. 

Management’s comments and actions are responsive to the 

recommendations. 

5. Eligibility Determinations 

We reviewed competency determinations completed by the VSC Decision 

Team to ensure staff completed them accurately and timely. Delays in 

making these determinations ultimately affect the Fiduciary Unit’s ability to 

be timely in appointing fiduciaries. 

VA must consider beneficiary competency in every case involving a mental 

health condition that is totally disabling or when evidence raises questions as 

to a beneficiary’s mental capacity to manage his or her affairs. The 

Fiduciary Unit supports implementation of incompetency determinations by 

VA Office of Inspector General 10 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Finding 4 

Recommendation 

Management 

Comments 

appointing a fiduciary, who is a third party that assists in managing funds for 

an incompetent beneficiary. 

VBA policy requires staff to obtain clear and convincing medical evidence 

that a beneficiary is incapable of managing his or her affairs prior to making 

a final competency decision. The policy allows the beneficiary a 65-day due 

process period to submit the evidence showing an ability to manage funds 

and other personal affairs. At the end of the due process period, VARO staff 

must take immediate action to determine if the beneficiary is competent. 

In the absence of a definition of “immediate,” we allowed 14 calendar days 

after the due process period to determine if VARO staff timely completed a 

competency decision. We considered this a reasonable period to control, 

prioritize, and finalize these types of cases. 

VARO Staff Need to Improve the Accuracy of 

Competency Determinations 

VARO staff did not always make accurate competency determinations. Two 

(11 percent) of the 18 competency determinations we reviewed contained 

processing inaccuracies. These inaccuracies occurred due to a lack of 

training regarding the type of medical evidence necessary to deem a 

beneficiary incompetent to manage VA funds. As a result, veterans were 

determined to be incompetent and denied the ability to manage their funds 

independently even though such decisions may have been unwarranted. 

In one case, VARO fiduciary staff acted upon an incorrect determination and 

appointed a fiduciary to manage a veteran’s monthly benefit payment. The 

fiduciary received the veteran’s benefit payments of $2,922 over a period of 

approximately 3 months. In the second case, the VARO did not appoint a 

fiduciary; however, the veteran was only able to access funds under the 

supervision of the Fiduciary Unit. In both cases, we did not find evidence of 

misused funds. VARO management agreed with our assessment that the 

decisions in both cases were premature and initiated corrective actions to 

obtain the required medical evidence to determine if the veterans were 

incompetent. 

8.	 We recommend the New Orleans VA Regional Office Director ensure 

Rating Veterans Service Representatives receive refresher training on 

evaluating evidence required to make accurate competency 

determinations. 

The VARO Director concurred with our recommendation and informed us 

that on December 16, 2010, all Decision Review Officers and RVSRs 

received refresher training on the evidence required to make accurate 

competency determinations. 

VA Office of Inspector General 11 
Inspection of the VA Regional Office, New Orleans, Louisiana 

OIG Response	 Management’s comments and actions are responsive to the recommendation. 

Finding 5	 Controls Over Competency Determinations Need 

Strengthening 

VARO staff unnecessarily delayed making final decisions in 3 (17 percent) 

of the 18 incompetency determinations VARO staff completed from July 

through September 2010. The delays ranged from 21 to 75 days, with an 

average completion time of 47 days. The delays occurred because the VSC 

workload management plan did not contain procedures emphasizing 

immediate completion of claims involving competency determinations. The 

risk of incompetent beneficiaries receiving benefit payments without 

fiduciaries increases when the staff does not complete the competency 

determinations immediately. 

Using our interpretation of “immediate” (14 calendar days after the due 

process period expires), the most significant delay occurred when VARO 

staff did not make a final incompetency decision for approximately 75 days. 

During this period, the veteran received approximately $19,823 in disability 

payments. While the veteran was entitled to these payments, fiduciary 

stewardship was not in place to ensure effective funds management and the 

welfare of the veteran. 

VARO managers stated they were aware of the VBA policy to process 

competency determinations immediately. One manager defined immediate 

as the day after the due process period expires, while another manager 

defined immediate as 30 days after the expiration of the due process period. 

However, the station’s workload management plan indicated that RVSRs 

process incompetency determinations as a priority once the age of a case 

reached 125 days or more. Because the plan did not emphasize the 

importance of completing these determinations immediately, incompetent 

beneficiaries received payments for extended periods without a fiduciary. 

Until recently, VBA did not have a clear, measurable definition of 

“immediate” and this timeframe varied from office-to-office. In response to 

our summary report for FY 2010, Systemic Issues Reported During 

Inspections at VA Regional Offices, (Report Number 11-00510-167, 

May 18, 2011), the Acting Under Secretary for Benefits defined “immediate” 

as 21 days following the expiration of the due process period. VBA plans to 

implement this new policy nationwide in June 2011. The VARO processed 

14 of 16 determinations in 21 days. 

VA Office of Inspector General 12 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Appendix A 

Organization 

Resources 

Workload 

Scope 

VARO Profile and Scope of Inspection 

The New Orleans VARO is responsible for delivering nonmedical VA 

benefits and services to veterans and their families in Louisiana. The VARO 

fulfills these responsibilities by administering compensation and pension 

benefits, vocational rehabilitation and employment assistance, and outreach 

activities. 

As of September 2010, the New Orleans VARO had a staffing level of 

180 full time employees. Of these, the VSC had 149 employees 

(83 percent) assigned. 

As of October 2010, the VARO reported 7,173 pending compensation 

claims. The average time to complete these claims during October 2010 was 

165.7 days—approximately 9 days better than the national target of 

175 days. As reported by STAR, the accuracy of compensation ratingrelated issues was 78.6 percent, which is below the 90 percent target set by 

VBA. 

We reviewed selected management controls, claims processing, and 

administrative activities to evaluate compliance with VBA policies regarding 

delivery of benefits and nonmedical services to veterans and other 

beneficiaries. We interviewed managers and employees and reviewed 

veterans’ claims folders. 

Our review included 78 (12 percent) of 666 disability claims related to 

PTSD, TBI, and herbicide exposure that the VARO completed from July to 

September 2010. For temporary 100 percent disability evaluations, we 

selected 30 (13 percent) of 226 existing claims from VBA’s Corporate 

Database. We provided the VARO with the 196 claims remaining from the 

universe of 226 to assist in implementing our first report recommendation. 

The 226 claims represented all instances in which VARO staff granted 

temporary 100 percent disability determinations for at least 18 months. 

We reviewed 28 errors identified by VBA’s STAR program during the 

period from July through September 2010. VBA measures the accuracy of 

compensation and pension claims processing through its STAR program. 

STAR’s assessments include a review of work associated with claims 

requiring rating decisions. The STAR staff reviews original claims, 

reopened claims, and claims for increased evaluation. Further, they review 

appellate issues that involve a myriad of veterans’ disabilities claims. 

Our process differs from STAR as we review specific types of disability 

claims such as PTSD, TBI, and herbicide exposure that require rating 

decisions. In addition, we review rating decisions and awards processing 

VA Office of Inspector General 13 
Inspection of the VA Regional Office, New Orleans, Louisiana 

involving temporary 100 percent disability evaluations. We selected dates of 

claim for those claims pending processing at the VARO. Additionally, we 

selected NODs that were pending processing between 31-60 days at the 

VARO during the time of our inspection. Further, we reviewed mail 

management by selecting mail in various processing stages within the VARO 

mailroom and the VSC. 

We completed our review in accordance with the Council of the Inspectors 

General on Integrity and Efficiency’s Quality Standards for Inspections. We 

planned and performed the review to obtain sufficient, appropriate evidence 

to provide a reasonable basis for our findings and conclusions based on our 

review objectives. We believe that the evidence obtained provides a 

reasonable basis for our findings and conclusions based on our review 

objectives. 

VA Office of Inspector General 14 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Appendix B VARO Director’s Comments 

Department of Memorandum Veterans Affairs 

Date: May 12, 2011 

From: Director, VA Regional Office New Orleans, Louisiana 

Subj: Inspection of the VA Regional Office, New Orleans, Louisiana 

To: Assistant Inspector General for Audits and Evaluations (52) 

Attached are the New Orleans VARO’s comments on the OIG Draft Report: Inspection 

of the VA Regional Office, New Orleans, Louisiana. 

1. 

2. Questions may be referred to Mr. Steve Kelly, Veterans Service Center Manager, at 

(504) 619-4560. 

(original signed by:) 

Debbie Biagioli 

Acting Director 

Attachment 

VA Office of Inspector General 15 
Inspection of the VA Regional Office, New Orleans, Louisiana 

New Orleans (321) 

March 14, 2011 

OIG Recommendations: 

Recommendation 1: We recommend the New Orleans VA Regional Office Director review the 

196 temporary 100 percent disability evaluations identified but not included in our inspection 

sample to determine if reevaluations are required and take appropriate action. 

New Orleans RO Response: Concur 

We concur with the recommendation. We began reviewing the list in December 2010. The list 

contained 196 cases to be reviewed. All but seven of the cases on the list that was provided have 

been reviewed. 

Five of the seven cases that have not been reviewed are Nehmer cases that are currently located 

at an offsite location. These folders will be reviewed upon completion of the Nehmer Review 

Project as they are returned to our office. One folder was requested again from the St. Louis 

RMC in December 2010; however, that request was cancelled. The folder was requested again 

on March 3, 2011. This folder will be reviewed as soon as it is received. The final case is in the 

process of being rebuilt and upon completion will be reviewed. The Triage Coach and Rating 

Coach are controlling the completion of these reviews and will have these cases reviewed as 

soon as they are available. 

Action has been taken on the folders, which required reevaluations. 

Recommendation 2: We recommend the New Orleans VA Regional Office Director implement 

controls to ensure staff establish reminder notifications for temporary 100 percent disability 

reevaluations. 

New Orleans RO Response: Concur 

We agree that the electronic system should automatically populate future exam dates. However, 

we do not believe the recommendation to generate an award for each of these cases is necessary 

or appropriate. In response to OIG Report, "Audit of 100 Percent Evaluations," dated January 

24, 2011, VBA developed a national plan to review 100 percent evaluation cases which was 

accepted by OIG. Therefore, the Regional Office will follow the national review plan. 

On May 11, 2011, Compensation and Pension Service provided interim guidance to the Field 

that provided the four basic scenarios where Future Exam Diary control is either being cancelled 

unexpectedly or not being set at all during the VETSNET Award generation process. This 

interim guidance will be utilized where appropriate. 

Recommendation 3: We recommend the New Orleans VA Regional Office Director implement 

controls to ensure staff take appropriate follow-up actions on reminder notifications for 

temporary 100 percent disability reevaluations. 

VA Office of Inspector General 16 
Inspection of the VA Regional Office, New Orleans, Louisiana 

New Orleans RO Response: Concur 

We concur with the recommendation. The VSC will complete a review of fifteen cancelled 810 

Work Items per month to ensure appropriate action is taken on the 810 Action Item. The reviews 

will begin in March 2011 and the findings will be saved on a shared drive for review. In 

addition, the quality team will add review of routine future exam actions to the quality checklist 

and this issue will become a part of the local quality review process. Any errors that are found 

will be reviewed and discussed with employees and trending data will be shared with the 

supervisor for training and follow-up action as needed. 

Recommendation 4: We recommend the New Orleans VA Regional Office Director require 

traumatic brain injury claims undergo an additional level of review (two-signatures) to ensure 

adequate medical examinations and accurate rating evaluations prior to finalizing benefit 

payments decisions. 

New Orleans RO Response: Concur In Part 

We concur in part with the recommendation. The VSC will require a second signature on TBI 

cases for each RVSR until the RVSR demonstrates a 90% quality average on a minimum of 10 

TBI cases. Once an RVSR has reached a 90% quality score average for a rolling 10 TBI cases, 

he or she will be awarded single signature authority for future TBI cases. Data obtained during 

this period of required second signatures will be used to identify training needs and to create any 

needed training sessions. 

Recommendation 5: We recommend the New Orleans VA Regional Office Director develop and 

implement a plan to provide adequate oversight to ensure staff timely enter Notices of 

Disagreement in the Veterans Appeals Control and Locator System. 

New Orleans RO Response: Concur 

We concur with the recommendation. As a result of findings from the C&P Site Visit in March 

2010, the VSC implemented changes to the mail processing procedures of Notice of 

Disagreements (NODs). In June 2010, the VSC began having a Senior VSR review incoming 

mail daily and deliver all NODs to the Appeals Coach. The NODs are entered into the Veterans 

Appeals Control and Locator System the day they are received on the Appeals Team. 

The VSC saw an improvement in the NOD control time since the changes were implemented in 

June 2010. The NOD control time was at 28 days in June 2010 and had decreased to 4 days in 

November 2010. The November 2010 data was the last data available due to data collection 

problems within the Office of Performance Analysis & Integrity (OPA&I). To ensure continued 

compliance with the 7-day timeframe for control of NODs, the Appeals Team supervisors will 

conduct a review of 10 randomly selected NODs monthly. Results of these reviews will be used 

to address training needs and to facilitate follow-up action as needed. 

VA Office of Inspector General 17 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Recommendation 6: We recommend the New Orleans VA Regional Office Director amend the 

workload management plan to include oversight measures for properly classifying action and 

non-priority drop mail. 

New Orleans RO Response: Concur 

We concur with the recommendation. The VSC has updated our Workload Management Plan to 

show that the Triage Team supervisor will review mail placed under control by Claims 

Assistants for properly classified action on pull, priority and non-priority mail on a monthly 

basis. 

Recommendation 7: We recommend the New Orleans VA Regional Office Director develop an 

oversight mechanism to ensure staff accurately process search and drop mail. 

New Orleans RO Response: Concur 

We concur with the recommendation. All incoming mail is reviewed by the Claims Assistants 

on the Triage Team. Mail that is received for folders that are stored in the file banks is 

associated with the corresponding claim folder. If the folder cannot be located the mail is placed 

on search in COVERS. 

All claims files are COVERED when they are received and prior to working the claim. If a 

search request is in COVERS, the person with the file will get the search mail from Triage. 

Triage personnel will delete search mail from COVERS. 

The VSC has updated our Workload Management Plan to show that mail that is located in the 

SEARCH bin for over 15 days will be reviewed by a Triage supervisor bi-weekly to determine if 

the location has changed or if a request was sent. 

Recommendation 8: We recommend the New Orleans VA Regional Office Director ensure 

Rating Veterans Service Representatives receive refresher training on evaluating evidence 

required to make accurate competency determinations. 

New Orleans RO Response: Concur 

We concur with the recommendation. All DROs and RVSRs received refresher training on the 

evaluation evidence required to make accurate competency determination on December 16, 

2010. In addition, these employees are scheduled for refresher training on this topic in June 

2011. 

VA Office of Inspector General 18 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Appendix C Inspection Summary
 

10 Operational 

Activities Inspected Criteria 

Reasonable 

Assurance of 

Compliance 

Yes No 

Claims Processing 

1. 100 Percent 

Disability 

Evaluations 

Determine whether VARO staff properly reviewed temporary 100 percent 

disability evaluations. (38 CFR 3.103(b)) (38 CFR 3.105(e)) (38 CFR 3.327) 

(M21-1MR Part IV, Subpart ii, Chapter 2, Section J) (M21-1MR Part III, 

Subpart iv, Chapter 3, Section C.17.e) 

X 

2. Post-Traumatic 

Stress Disorder 

Determine whether VARO staff properly processed claims for PTSD. (38 

CFR 3.304(f)) X 

3. Traumatic Brain 

Injury 

Determine whether claims for service connection for all residual disabilities 

related to in-service TBI were properly processed. (Fast Letters 08-34 and 

08-36, Training Letter 09-01) 

X 

4. Herbicide ExposureRelated Claims Determine whether VARO staff properly processed claims for service 

connection for herbicide exposure (Agent Orange). (38 CFR 3.309) (Fast 

Letter 02-33) (M21-1MR Part IV, Subpart ii, Chapter 2, Section C.10) 

X 

Data Integrity 

5. Date of Claim Determine whether VARO staff properly recorded correct dates of claim in 

the electronic records. (M21-1MR, Part III, Subpart ii, Chapter 1, Section C) X 

6. Notice of 

Disagreement 

Determine whether VARO staff properly entered NODs into VACOLS. 

(M21-1MR Part I, Chapter 5) X 

Management Controls 

7. Systematic 

Technical Accuracy 

Review 

Determine whether VARO staff properly corrected STAR errors in 

accordance with VBA policy. (M21-4, Chapter 3, Subchapter II, 3.03) X 

8. Systematic Analysis 

of Operations 

Determine whether VARO staff properly performed formal analyses of 

their operations through completion of SAOs. (M21-4, Chapter 5) X 

Workload Management 

9. Mail Handling 

Procedures 

Determine whether VARO staff properly followed VBA mail handling 

procedures. (M23-1) (M21-4, Chapter 4) (M21-1MR Part III, Subpart ii, 

Chapters 1 and 4) 

X 

Eligibility Determinations 

10. Competency 

Determinations 

Determine whether VAROs properly assessed beneficiaries’ mental 

capacity to handle VA benefit payments. (M21-1MR Part III, Subpart v, 

Chapter 9, Section A) (M21-1MR Part III. Subpart v, Chapter 9, Section B) 

(Fast Letter 09-08) 

X 

CFR=Code of Federal Regulations, M=Manual, MR=Manual Re-write 

Source: OIG 

VA Office of Inspector General 19 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Appendix D OIG Contact and Staff Acknowledgments
 

OIG Contact	 For more information about this report, please 

contact the Office of Inspector General at 

(202) 461-4720. 

Acknowledgments	 Brent Arronte, Director 

Brett Byrd 

Madeline Cantu 

Kelly Crawford 

Ramon Figueroa 

Lee Giesbrecht 

Kerri Leggiero-Yglesias 

Nora Stokes 

Lisa Van Haeren 

VA Office of Inspector General 20 
Inspection of the VA Regional Office, New Orleans, Louisiana 

Appendix E Report Distribution 

VA Distribution 

Office of the Secretary
 

Veterans Benefits Administration
 

Assistant Secretaries
 

Office of General Counsel
 

VBA Central Area Director
 

VARO New Orleans Director
 

Non-VA Distribution 

House Committee on Veterans’ Affairs 

House Appropriations Subcommittee on Military Construction, Veterans 

Affairs, and Related Agencies 

House Committee on Oversight and Government Reform 

Senate Committee on Veterans’ Affairs 

Senate Appropriations Subcommittee on Military Construction, Veterans 

Affairs, and Related Agencies 

Senate Committee on Homeland Security and Governmental Affairs 

National Veterans Service Organizations 

Government Accountability Office 

Office of Management and Budget 

U.S. Senate: Mary Landrieu, David Vitter 

U.S. House of Representatives: Rodney Alexander, Charles Boustany, Bill 

Cassidy, John Fleming, Jeff Landry, Cedric Richmond, Steve Scalise 

This report will be available in the near future on the OIG’s Web site at 

http://www.va.gov/oig/publications/reports-list.asp. This report will remain 

on the OIG Web site for at least 2 fiscal years. 

VA Office of Inspector General 21