Department of Veterans Affairs 

Office of Inspector General 

Review of Alleged 

Claim Processing Delays to 

Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

Report No. 09-00213-125 May 12, 2009

VA Office of Inspector General 

Washington, DC 20420 
To Report Suspected Wrongdoing in VA Programs and Operations 

Telephone: 1-800 488-8244 between 8:30AM and 4:00PM Eastern Time, 

Monday through Friday, excluding Federal holidays 

E-Mail:vaoighotline@va.gov
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

VA Office of Inspector General 

Contents 

Page 

Executive Summary .....................................................................................................i-ii

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

Results and Conclusions

Allegation ........................................................................................................................ 3 

Conclusion ...................................................................................................................... 4 

Recommendations............................................................................................................ 5 

Management Comments and OIG Response................................................................... 5 

Appendixes

A. Under Secretary for Benefits Comments.................................................................. 6 

B. OIG Contact and Staff Acknowledgments............................................................... 8 

C. Report Distribution .................................................................................................. 9 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

VA Office of Inspector General i 

Executive Summary 

The Office of Inspector General (OIG) reviewed an October 21, 2008, anonymous 

allegation that Veterans Service Center (VSC) managers at VA Regional Office (VARO) 

Pittsburgh delayed processing of Global War on Terror (GWOT) veterans’ claims to 

receive monetary performance awards. Specifically, the complainant alleged VSC 

managers instructed Veterans Service Representatives (VSR) to delay the processing of 

GWOT claims that were ready for a rating decision to meet incentive goals and receive 

performance award money. 

We did not substantiate the allegation, but found that VSC managers and VSRs differed 

in their understanding about how to meet an April/May 2008 incremental incentive 

offered by the Veterans Benefits Administration (VBA) Office of Field Operations 

(OFO). The purpose of the incremental incentive was to encourage VSCs to make timely 

rating decisions on GWOT claims and to expedite claim processing. Specifically, by 

May 31, 2008, the goal was to have zero GWOT claims pending that were awaiting a 

rating decision for more than 7 days. 

The misunderstanding between VSC managers and VSRs caused confusion among staff, 

resulting in VSRs delaying the processing of some GWOT claims. We identified 

10 GWOT claims that were not rated when they were ready to rate. For five of these 

claims, the delay resulted in veterans receiving compensation benefit payments a month 

late, ranging from $226 to $1,375. VSRs believed that VSC managers wanted them to 

delay claim processing to meet the incentive criteria. However, VSC managers denied 

instructing VSRs to delay claim processing and we did not find compelling evidence to 

substantiate the allegation that managers told VSRs to delay claim processing. 

The confusion among VARO Pittsburgh staff occurred because VARO policies and 

procedures lacked continuous feedback mechanisms to ensure VSR’s aggressive pursuit 

of performance goals do not violate VBA policies or delay claim processing. The 

misunderstanding and confusion caused the VARO to delay rating decisions and benefit 

payments unnecessarily. Delayed payments can cause veterans and their families’ 

financial hardship by depriving them of timely compensation and a source of income. In 

addition, these delays, which were unintended consequences of the incremental incentive 

criteria, were contrary to VBA’s strategic objective of providing timely decisions on 

disability compensation claims and goals to reduce the backlog of unprocessed claims. 

We conducted similar reviews at VAROs Boston, Indianapolis, and San Diego, 3 of 

14 VAROs that reported achieving the April/May 2008 incentive, to determine if other 

VAROs achieved the incentive by delaying the processing of GWOT claims. For these 

three VAROs, we concluded that managers communicated and VSRs understood how to 

meet the April/May incentive without delaying the processing of GWOT claims. As a 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

VA Office of Inspector General ii 

result, we did not find that VSRs, at the three additional VAROs where we expanded our 

testing, delayed the processing of GWOT claims. 

On November 17, 2008, we provided VBA officials preliminary results indicating that 

VARO Pittsburgh VSRs had inappropriately delayed the processing of GWOT claims to 

meet the April/May 2008 incentive. On November 19, 2008, VBA suspended the use of 

incremental performance incentives at all VAROs nationwide until further notice. 

Recommendations 

1. We recommended the Under Secretary for Benefits require OFO to incorporate 

independent monitoring of VARO reported achievement of future incentive-based 

performance award goals to ensure unintended outcomes do not occur. 

2. We recommended the Under Secretary for Benefits ensure the VARO Pittsburgh 

Director establish policies and procedures that include feedback mechanisms to 

ensure VSRs pursue performance goals without violating VBA policies or delaying 

claim processing. 

Management Comments and OIG Response 

The Under Secretary agreed with our findings and reported that VBA has not 

implemented any short-term incentive-based performance award programs since ceasing 

such programs in November 2008. He also agreed with our recommendations and 

reported completion of improvement actions (See Appendix A). We consider these 

actions acceptable and the recommendations closed. 

 (original signed by:) 

BELINDA J. FINN 

Assistant Inspector General 

for Auditing 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

VA Office of Inspector General 1 

Introduction 

Purpose 

The OIG reviewed an October 21, 2008, anonymous allegation that VSC managers at 

VARO Pittsburgh delayed processing of GWOT veterans’ claims to receive monetary 

performance awards. Specifically, the complainant alleged VSC managers instructed 

VSRs to delay processing of GWOT claims that were ready for a rating decision to meet 

performance goals and to receive award money. 

Background 

VBA Incremental Incentive Performance Awards. In an effort to improve VSC 

performance and recognize achievements throughout the year, in April 2007, VBA’s 

OFO, began providing incremental incentive monetary awards to VSCs that met certain 

performance goals. During 2008, OFO established four incremental incentive periods: 

January/February, April/May, July/August, and October/November. For each of the 

incremental incentive periods, OFO established four to five varying criteria VSCs needed 

to meet to receive monetary awards. In 2008, if a VSC met all of the criteria for an 

incremental incentive period, each VSC employee would receive $300. 

April/May 2008 Incremental Incentives. For the April/May 2008 incremental 

incentive period, OFO established five criteria VAROs had to meet to receive monetary 

awards. One of the five criteria was not to have any GWOT claims awaiting a rating 

decision for more than 7 days as of May 31, 2008. The purpose of the criteria was to 

encourage VSCs to make rating decisions on GWOT claims within 7 days of becoming 

ready for a rating decision. This meant that if one or more GWOT claims had been ready 

for a rating decision more than 7 days as of May 31, 2008, VSCs would not meet the 

criteria or receive the $300 for each employee. During 2008, the April/May incentive 

was the only incentive for which VARO Pittsburgh met criteria, and the VARO received 

$36,120 ($300 for the 120.4 VSC employees). 

VBA Policy on Referring Ready-to-Rate Claims to Rating Teams. To help ensure 

efficient claims processing, VBA requires VSCs to establish the following four main 

teams — Triage Team, Pre-Determination Team, Rating Team, and Post-Determination 

Team. Each team is responsible for performing specialized claim processing tasks. For 

example, the Pre-Determination team is responsible for developing claims, determining if 

they are ready for a rating decision and referring ready to rate claims to the VARO’s 

Rating Team. The key responsibilities of each team are described below. 

• The Triage Team reviews and processes all incoming mail, identifies benefit claims, 

and refers claims needing development to the Pre-Determination Team. 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

VA Office of Inspector General 2 

• The Pre-Determination Team develops claims, determines if they are ready-to-rate, 

and refers ready-to-rate claims to the Rating Team. 

• The Rating Team rates and refers claims to the Post-Determination Team. 

• The Post-Determination Team authorizes benefit awards, prepares beneficiary 

notification letters, and completes entitlement determinations for claims not requiring 

a rating. 

Scope and Methodology 

To determine the validity of the VARO Pittsburgh allegation, we performed work at 

VARO Pittsburgh between October–November 2008. During the review, we obtained 

testimony from the VARO Director, VSC managers, Pre-Determination Team Coaches, 

and seven VSRs and reviewed claims folders for 120 GWOT claims the VARO 

completed during June–July 2008. We also analyzed OFO incremental incentive award 

data and interviewed OFO managers. 

To determine if other VAROs delayed the processing of GWOT claims to meet the 

April/May 2008 incremental incentive criteria, we performed similar onsite reviews at 

VAROs Boston, Indianapolis, and San Diego during November–December 2008. At 

these three VAROs, we interviewed VSC managers, Pre-Determination Team Coaches, 

and VSRs. At each VARO, we also reviewed 100 GWOT claims completed in June 

2008. 

VBA’s April/May 2008 incremental incentives required VAROs to meet five incentive 

criteria. Our review focused on the incentive criteria that required VAROs to have zero 

GWOT claims awaiting a rating decision for more than 7 days as of May 31, 2008. 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

VA Office of Inspector General 3 

Results and Conclusions 

Allegation: VARO Pittsburgh Managers Instructed Staff to Delay the Processing 

of Ready-to-Rate GWOT Compensation Claims to Meet Special Targets and 

Receive Award Money 

We did not substantiate the allegation that VARO Pittsburgh’s VSC managers instructed 

VSRs to delay the processing of GWOT claims that were ready for a rating decision. 

However, we did determine that VSC managers and VSRs differed in their understanding 

about how to meet an April/May 2008 incremental incentive offered by VBA’s OFO to 

have zero GWOT claims awaiting a rating decision for more than 7 days as of May 31, 

2008. VSR managers testified that the VARO should have achieved the incentive criteria 

by making rating decisions within 7 days of when claims became ready for a rating. 

VSRs testified that they believed managers wanted to achieve the incentive by delaying 

the referral of ready-to-rate claims to the Rating Team until after the April/May incentive 

award period. 

This misunderstanding caused confusion among VSRs, resulting in VSRs delaying the 

processing of at least 10 GWOT claims. For five of these claims, the delayed processing 

caused veterans to receive compensation benefit payments ranging from $226 to $1,375 a 

month late. Delayed payments can cause veterans and their families’ financial hardship 

by depriving them of entitled compensation and a source of income. In addition, these 

delays, which were unintended consequences of the incremental incentive, were contrary 

to VBA’s strategic objective of providing timely decisions on disability compensation 

claims and goals to reduce the backlog of unprocessed claims. The confusion among 

VARO Pittsburgh staff occurred because VARO policies and procedures lacked 

continuous feedback mechanisms to ensure VSR’s aggressive pursuit of performance 

goals do not violate VBA policies or delay claim processing. 

Testimony from four VSC managers and seven Pre-Determination Team VSRs disclosed 

that miscommunication caused the VSRs to be confused on how to achieve the 

April/May incentive criteria related to ready-to-rate GWOT claims. The four managers 

all denied instructing Pre-Determination Team VSRs to delay referring GWOT claims to 

the Rating Team that were ready for a rating decision. They also stated that it would be 

inappropriate to delay the referral of claims for rating decisions. 

However, five of the seven Pre-Determination Team VSRs testified that either they or 

other VSRs delayed the referral of claims that were ready for a rating decision to the 

Rating Team because of the belief that VSC managers wanted the referrals delayed to 

help the VSC meet the April/May incentive award criteria. VSC managers testified that 

because of the VARO’s large backlog of claims, their main effort centered on processing 

older claims rather than newer ready-to-rate GWOT claims. 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

VA Office of Inspector General 4 

The misunderstanding and confusion was apparent when we asked VSC managers and 

VSRs about unusual notes that we found in a small number of claims folders. For 

example, a VSR included the following May 6 note in a claims folder: “Reviewed claim 

and determined that it is not ready to rate because of the April/May incentive.” When we 

asked the VSR about the note, the VSR stated that the claim was ready for a rating 

decision on May 6, but the VSR thought VSC managers did not want the claim referred 

to the Rating Team until after May 31, 2008, which was the end of the April/May 

incentive period. However, when we showed the note to VSC managers, they stated that 

they never told VSRs to delay referring claims ready for a rating decision to the Rating 

Team and did not understand why the VSR included the note in the claim folder. 

Other VAROs Did Not Delay the Processing of Ready-to-Rate GWOT 

Compensation Claims to Meet Special Targets and Receive Money 

To determine if other VAROs delayed the processing of GWOT claims that were ready 

for a rating decision to meet the April/May 2008 incentive criteria, we conducted similar 

reviews at VAROs Boston, Indianapolis, and San Diego — 3 of the 14 VAROs where 

staff received monetary awards for meeting the OFO April/May incentive. To determine 

if other VAROs delayed the processing of GWOT claims to meet the criteria for the 

April/May 2008 incentive, we conducted similar reviews at VAROs Boston, 

Indianapolis, and San Diego. For these three VAROs, we concluded managers 

communicated and VSRs understood how to meet the April/May incentive without 

delaying the processing of GWOT claims. As a result, these VAROs did not delay the 

processing of the GWOT claims we reviewed. 

Conclusion 

We did not substantiate the allegation that VARO Pittsburgh’s VSC managers instructed 

VSRs to delay the processing of GWOT claims that were ready for a rating decision. 

However, we did determine that VSC managers and VSRs differed in their understanding 

about how to meet an April/May 2008 incremental incentive offered by OFO to have zero 

GWOT claims awaiting a rating decision for more than 7 days, as of May 31, 2008. 

This misunderstanding caused confusion among VSRs, resulting in VSRs delaying the 

processing of at least 10 GWOT claims. For five of these claims, the delay resulted in 

veterans receiving compensation benefit payments a month late. These payments ranged 

from $226 to $1,375. Delayed payments can cause veterans and their families’ financial 

hardship by depriving them of timely compensation and a source of income. In addition, 

the delays, which were unintended consequences of the incremental incentive, were 

contrary to VBA’s strategic objective of providing timely decisions on disability 

compensation claims and goals to reduce the backlog of unprocessed claims. 

On November 17, 2008, we provided VBA officials preliminary results indicating that 

VARO Pittsburgh VSRs had inappropriately delayed the processing of GWOT claims to 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

VA Office of Inspector General 5 

meet the April/May 2008 incentive. On November 19, 2008, VBA suspended the use of 

incremental incentives at all VAROs nationwide until further notice. Although VARO 

Pittsburgh VSRs inappropriately delayed claim processing, VSC managers at VARO 

Pittsburgh and three other VAROs stated that they did not instruct VSRs to delay claim 

processing. Of the four VAROs, miscommunication and confusion about the April/May 

2008 incremental incentive criteria was limited to VARO Pittsburgh. 

Recommendations 

1. We recommended the Under Secretary for Benefits require OFO to incorporate 

independent monitoring of VARO reported achievement of future incentive-based 

performance award goals to ensure unintended outcomes do not occur. 

2. We recommended the Under Secretary for Benefits ensure the VARO Pittsburgh 

Director establish policies and procedures that include feedback mechanisms to 

ensure VSRs pursue performance goals without violating VBA policies or delaying 

claim processing. 

Management Comments and OIG Response 

The Under Secretary agreed with our findings and recommendations and reported that 

VBA has not implemented any short-term incentive-based performance award programs 

since ceasing such programs in November 2008. VBA’s four area offices have 

incorporated a number of integrity checks into their annual regional office site visits. 

These reviews include ensuring the correct date of claim is established for pending 

actions, accountability of mail, and verifying proper updates in computer systems. These 

reviews will remain in place when a performance award program is resumed. 

On April 20, 2009, the VARO Pittsburgh Director implemented a policy requiring 

managers to provide written guidance to employees clearly identifying the VARO’s 

performance targets and the course of action for reaching these goals utilizing the 

VARO’s workload management plan. The policy requires the Veterans Service Center 

Manager to approve the final draft of any written directive and submit a copy to the 

Director for concurrence and issuance to employees for implementation. Managers will 

meet with employees to answer any questions and ensure full understanding of the new 

processes and oversee implementation of the new processes. VBA requested closure of 

both recommendations. 

The reported completed actions for both recommendations are acceptable and we 

consider both recommendations closed. 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

Appe

Under Secretary for Benefits Comments

ndix A 

VA Office of Inspector General 6 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

Appendix A 

VA Office of Inspector General 7 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

Appendix B 

VA Office of Inspector General 8 

OIG Contact and Staff Acknowledgments 

OIG Contact Kent Wrathall (404) 929-5921 

Acknowledgments George Boyer 

Guy Durand 

Linda Fournier 

Henry Hoffman 

Nathaniel Holman 

Earl Key 

George Patton 

Cheri Preston 

Leon Roberts 

Felicia Stovall 

Al Tate 
Review of Alleged Claim Processing Delays to Receive Monetary Performance Awards 

at VA Regional Office Pittsburgh, PA 

Appendix C 

VA Office of Inspector General 9 

Report Distribution 

VA Distribution

Office of the Secretary 

Veterans Health Administration 

Veterans Benefits Administration 

National Cemetery Administration 

Assistant Secretaries 

Office of General Counsel 

Director, VBA Eastern Area (20F1) 

Director, VA Regional Office Pittsburgh, PA (311/00) 

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: Robert Casey Jr., Arlen Specter, Robert Byrd, John Rockefeller 

U.S. House of Representatives: Jason Altmire, Kathleen Dahlkemper, Michael Doyle, 

John Murtha, Bill Shuster, Glenn Thompson, Alan Mollohan 

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 after it is issued.