IB 
Union Calendar No. 95 
113TH CONGRESS 
1ST SESSION H. R. 1405 
[Report No. 113–130] 
To amend title 38, United States Code, to require the Secretary of Veterans 
Affairs to include an appeals form in any notice of decision issued 
for the denial of a benefit sought. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 25, 2013 
Ms. TITUS (for herself and Mr. RUNYAN) introduced the following bill; which 
was referred to the Committee on Veterans’ Affairs 
JUNE 25, 2013 
Additional sponsors: Mr. TAKANO, Mr. CALVERT, Mr. JOHNSON of Ohio, Mr. 
LANCE, Mr. O’ROURKE, Mr. LOEBSACK, Mr. RUIZ, and Mr. RAHALL 
JUNE 25, 2013 
Reported with amendments, committed to the Committee of the Whole House 
on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
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A BILL 
To amend title 38, United States Code, to require the Sec-
retary of Veterans Affairs to include an appeals form 
in any notice of decision issued for the denial of a 
benefit sought. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. INCLUSION OF APPEALS FORMS IN NOTICES OF 
DECISIONS OF BENEFITS DENIALS ISSUED BY 
THE SECRETARY OF VETERANS AFFAIRS. 
(a) IN GENERAL.—Section 5104(b) of title 38, 
United States Code, is amended— 
(1) by striking ‘‘and (2)’’ and inserting ‘‘(2)’’; 
and 
(2) by inserting before the period at the end the 
following: ‘‘, and (3) a form that may be used to file 
an appeal of the decision’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply with respect to decisions made 
by the Secretary under section 511 of title 38, United 
States Code, on or after the date of the enactment of this 
Act. 
SECTION 1. INCLUSION OF NOTICE OF DISAGREEMENT 
FORMS IN NOTICES OF DECISIONS OF BENE-
FITS DENIALS ISSUED BY SECRETARY OF VET-
ERANS AFFAIRS. 
(a) IN GENERAL.—Section 5104(b) of title 38, United 
States Code, is amended— 
(1) by striking ‘‘and (2)’’ and inserting ‘‘(2)’’; 
and 
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(2) by inserting before the period at the end the 
following: ‘‘, and (3) a form that may be used to file 
a notice of disagreement to the decision’’. 
(b) EFFECTIVE DATE.—The amendments made by sub-
section (a) shall apply with respect to decisions made by 
the Secretary under section 511 of title 38, United States 
Code, on or after the date of the enactment of this Act. 
SEC. 2. PROVISION OF STATUS UNDER LAW BY HONORING 
CERTAIN MEMBERS OF THE RESERVE COMPO-
NENTS AS VETERANS. 
(a) VETERAN STATUS.— 
(1) IN GENERAL.—Chapter 1 of title 38, United 
States Code, is amended by inserting after section 107 
the following new section: 
‘‘§ 107A. Honoring as veterans certain persons who 
performed service in the reserve compo-
nents 
‘‘Any person who is entitled under chapter 1223 of title 
10 to retired pay for nonregular service or, but for age, 
would be entitled under such chapter to retired pay for non-
regular service shall be honored as a veteran but shall not 
be entitled to any benefit by reason of this section.’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions at the beginning of such chapter is amended by 
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inserting after the item relating to section 107 the fol-
lowing new item: 
‘‘107A. Honoring as veterans certain persons who performed service in the reserve 
components.’’. 
(b) CLARIFICATION REGARDING BENEFITS.—No per-
son may receive any benefit under the laws administered 
by the Secretary of Veterans Affairs solely by reason of sec-
tion 107A of title 38, United States Code, as added by sub-
section (a). 
SEC. 3. PROVISION OF ACCESS TO CASE-TRACKING INFOR-
MATION. 
(a) IN GENERAL.—Chapter 59 of title 38, United 
States Code, is amended by adding at the end the following: 
‘‘§ 5906. Provision of access to case-tracking informa-
tion 
‘‘(a) IN GENERAL.—(1) In accordance with subsection 
(b), the Secretary shall provide a covered employee with ac-
cess to the case-tracking system to provide a veteran with 
information regarding the status of a claim submitted by 
such veteran if such employee is acting under written per-
mission or a power of attorney executed by such veteran. 
‘‘(2) In providing a covered employee with access to 
the case-tracking system under paragraph (1), the Secretary 
shall ensure— 
‘‘(A) that such access— 
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‘‘(i) is provided in a manner that does not 
allow such employee to modify the data con-
tained in such system; and 
‘‘(ii) does not include access to medical 
records; and 
‘‘(B) that each time a covered employee accesses 
such system, the employee must certify that such ac-
cess is for official purposes only. 
‘‘(b) PRIVACY CERTIFICATION COURSE.—The Sec-
retary may not provide a covered employee with access to 
the case-tracking system under subsection (a)(1) unless the 
covered employee has successfully completed a certification 
course on privacy issues provided by the Secretary. 
‘‘(c) TREATMENT OF DISCLOSURE.—The access to in-
formation by a covered employee pursuant to subsection 
(a)(1) shall be deemed to be— 
‘‘(1) a covered disclosure under section 552a(b) 
of title 5; and 
‘‘(2) a permitted disclosure under regulations 
promulgated under section 264(c) of the Health Insur-
ance Portability and Accountability Act of 1996 (42 
U.S.C. 1320d–2 note). 
‘‘(d) DEFINITIONS.—In this section: 
‘‘(1) The term ‘case-tracking system’ means the 
system of the Department of Veterans Affairs that 
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provides information regarding the status of a claim 
submitted by a veteran. 
‘‘(2) The term ‘covered employee’ means an em-
ployee of a State or local governmental agency (in-
cluding a veterans service officer) who, in the course 
of carrying out the responsibilities of such employ-
ment, assists veterans with claims for any benefit 
under the laws administered by the Secretary.’’. 
(b) CLERICAL AMENDMENT.—The table of sections at 
the beginning of such chapter is amended by adding at the 
end the following new item: 
‘‘5906. Provision of access to case-tracking information.’’. 
SEC. 4. IMPROVEMENT OF FIDUCIARIES FOR VETERANS. 
(a) APPOINTMENT AND SUPERVISION.— 
(1) Section 5502 of title 38, United States Code, 
is amended to read as follows: 
‘‘§ 5502. Appointment of fiduciaries 
‘‘(a) APPOINTMENT.—(1) Where it appears to the Sec-
retary that the interest of the beneficiary would be served 
thereby, payment of benefits under any law administered 
by the Secretary may be made directly to the beneficiary 
or to a relative or some other fiduciary for the use and ben-
efit of the beneficiary, regardless of any legal disability on 
the part of the beneficiary. 
‘‘(2) When in the opinion of the Secretary, a tem-
porary fiduciary is needed in order to protect the benefits 
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provided to the beneficiary under any law administered by 
the Secretary while a determination of incompetency is 
being made or appealed or a fiduciary is appealing a deter-
mination of misuse, the Secretary may appoint one or more 
temporary fiduciaries for a period not to exceed 120 days. 
If a final decision has not been made within 120 days, the 
Secretary may not continue the appointment of the fidu-
ciary without obtaining a court order for appointment of 
a guardian, conservator, or other fiduciary under the au-
thority provided in section 5502(b) of this title. 
‘‘(b) APPEALS.—(1) If the Secretary determines a ben-
eficiary to be mentally incompetent for purposes of appoint-
ing a fiduciary under this chapter, the Secretary shall pro-
vide such beneficiary with a written statement detailing the 
reasons for such determination. 
‘‘(2) A beneficiary whom the Secretary has determined 
to be mentally incompetent for purposes of appointing a 
fiduciary under this chapter may appeal such determina-
tion. 
‘‘(c) MODIFICATION.—(1) A beneficiary for whom the 
Secretary appoints a fiduciary under this chapter may, at 
any time, request the Secretary to— 
‘‘(A) remove the fiduciary so appointed; and 
‘‘(B) have a new fiduciary appointed. 
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‘‘(2) The Secretary shall comply with a request under 
paragraph (1) if the Secretary determines that the request 
is made in good faith and— 
‘‘(A) the fiduciary requested to be removed re-
ceives a fee from the beneficiary and a suitable volun-
teer fiduciary is available to assist the beneficiary; or 
‘‘(B) the beneficiary provides credible informa-
tion that the fiduciary requested to be removed is— 
‘‘(i) not acting in the interest of the bene-
ficiary ;or 
‘‘(ii) unable to effectively serve the bene-
ficiary because of an irreconcilable personality 
conflict or disagreement. 
‘‘(3) The Secretary shall ensure that any removal or 
new appointment of a fiduciary under paragraph (1) does 
not delay or interrupt the beneficiary’s receipt of benefits 
administered by the Secretary. 
‘‘(d) INDEPENDENCE.—A fiduciary appointed by the 
Secretary shall operate independently of the Department to 
determine the actions that are in the interest of the bene-
ficiary. 
‘‘(e) PREDESIGNATION.—A veteran may predesignate 
a fiduciary by— 
‘‘(1) submitting written notice to the Secretary 
of the predesignated fiduciary; or 
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‘‘(2) submitting a form provided by the Sec-
retary for such purpose. 
‘‘(f) APPOINTMENT
OF NON-PREDESIGNATED FIDU-
CIARY.—If a beneficiary designates an individual to serve 
as a fiduciary under subsection (e) and the Secretary ap-
points an individual not so designated as the fiduciary for 
such beneficiary, the Secretary shall notify such beneficiary 
of— 
‘‘(1) the reason why such designated individual 
was not appointed; and 
‘‘(2) the ability of the beneficiary to modify the 
appointed fiduciary under subsection (c). 
‘‘(g) PRIORITY OF APPOINTMENT.—In appointing a fi-
duciary under this chapter, if a beneficiary does not des-
ignate a fiduciary pursuant to subsection (e), to the extent 
possible the Secretary shall appoint a person who is— 
‘‘(1) a relative of the beneficiary; 
‘‘(2) appointed as guardian of the beneficiary by 
a court of competent jurisdiction; or 
‘‘(3) authorized to act on behalf of the bene-
ficiary under a durable power of attorney.’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions at the beginning of chapter 55 of title 38, 
United States Code, is amended by striking the item 
relating to section 5502 and inserting the following: 
‘‘5502. Appointment of fiduciaries.’’. 
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(b) SUPERVISION.— 
(1) IN GENERAL.—Chapter 55 of title 38, United 
States Code, is amended by inserting after section 
5502, as amended by subsection (a)(1), the following 
new section: 
‘‘§ 5502A. Supervision of fiduciaries 
‘‘(a) COMMISSION.—(1)(A) In a case in which the Sec-
retary determines that a commission is necessary in order 
to obtain the services of a fiduciary in the best interests 
of a beneficiary, the Secretary may authorize a fiduciary 
appointed by the Secretary to obtain from the monthly ben-
efits provided to the beneficiary a reasonable commission 
for fiduciary services rendered, but the commission for any 
month may not exceed the lesser of the following amounts: 
‘‘(i) The amount that equals three percent of the 
monthly monetary benefits under laws administered 
by the Secretary paid on behalf of the beneficiary to 
the fiduciary. 
‘‘(ii) $35. 
‘‘(B) A commission paid under this paragraph may 
not be derived from any award to a beneficiary regarding 
back pay or retroactive benefits payments. 
‘‘(C) A commission may not be authorized for a fidu-
ciary who receives any other form of remuneration or pay-
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ment in connection with rendering fiduciary services for 
benefits under this title on behalf of the beneficiary. 
‘‘(D) In accordance with section 6106 of this title, a 
commission may not be paid to a fiduciary if the Secretary 
determines that the fiduciary misused any benefit payments 
of a beneficiary. 
‘‘(E) If the Secretary determines that the fiduciary has 
misused any benefit or payments of a beneficiary, the Sec-
retary may revoke the fiduciary status of the fiduciary. 
‘‘(2) Where, in the opinion of the Secretary, any fidu-
ciary receiving funds on behalf of a Department beneficiary 
is acting in such a number of cases as to make it impracti-
cable to conserve properly the estates or to supervise the per-
sons of the beneficiaries, the Secretary may refuse to make 
future payments in such cases as the Secretary may deem 
proper. 
‘‘(b) COURT.—Whenever it appears that any fiduciary, 
in the opinion of the Secretary, is not properly executing 
or has not properly executed the duties of the trust of such 
fiduciary or has collected or paid, or is attempting to collect 
or pay, fees, commissions, or allowances that are inequitable 
or in excess of those allowed by law for the duties performed 
or expenses incurred, or has failed to make such payments 
as may be necessary for the benefit of the ward or the de-
pendents of the ward, then the Secretary may appear, by 
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the Secretary’s authorized attorney, in the court which has 
appointed such fiduciary, or in any court having original, 
concurrent, or appellate jurisdiction over said cause, and 
make proper presentation of such matters. The Secretary, 
in the Secretary’s discretion, may suspend payments to any 
such fiduciary who shall neglect or refuse, after reasonable 
notice, to render an account to the Secretary from time to 
time showing the application of such payments for the ben-
efit of such incompetent or minor beneficiary, or who shall 
neglect or refuse to administer the estate according to law. 
The Secretary may require the fiduciary, as part of such 
account, to disclose any additional financial information 
concerning the beneficiary (except for information that is 
not available to the fiduciary). The Secretary may appear 
or intervene by the Secretary’s duly authorized attorney in 
any court as an interested party in any litigation insti-
tuted by the Secretary or otherwise, directly affecting money 
paid to such fiduciary under this section. 
‘‘(c) PAYMENT OF CERTAIN EXPENSES.—Authority is 
hereby granted for the payment of any court or other ex-
penses incident to any investigation or court proceeding for 
the appointment of any fiduciary or other person for the 
purpose of payment of benefits payable under laws adminis-
tered by the Secretary or the removal of such fiduciary and 
appointment of another, and of expenses in connection with 
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the administration of such benefits by such fiduciaries, or 
in connection with any other court proceeding hereby au-
thorized, when such payment is authorized by the Secretary. 
‘‘(d) TEMPORARY PAYMENT OF BENEFITS.—All or any 
part of any benefits the payment of which is suspended or 
withheld under this section may, in the discretion of the 
Secretary, be paid temporarily to the person having custody 
and control of the incompetent or minor beneficiary, to be 
used solely for the benefit of such beneficiary, or, in the case 
of an incompetent veteran, may be apportioned to the de-
pendent or dependents, if any, of such veteran. Any part 
not so paid and any funds of a mentally incompetent or 
insane veteran not paid to the chief officer of the institution 
in which such veteran is a patient nor apportioned to the 
veteran’s dependent or dependents may be ordered held in 
the Treasury to the credit of such beneficiary. All funds so 
held shall be disbursed under the order and in the discretion 
of the Secretary for the benefit of such beneficiary or the 
beneficiary’s dependents. Any balance remaining in such 
fund to the credit of any beneficiary may be paid to the 
beneficiary if the beneficiary recovers and is found com-
petent, or if a minor, attains majority, or otherwise to the 
beneficiary’s fiduciary, or, in the event of the beneficiary’s 
death, to the beneficiary’s personal representative, except as 
otherwise provided by law; however, payment will not be 
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made to the beneficiary’s personal representative if, under 
the law of the beneficiary’s last legal residence, the bene-
ficiary’s estate would escheat to the State. In the event of 
the death of a mentally incompetent or insane veteran, all 
gratuitous benefits under laws administered by the Sec-
retary deposited before or after August 7, 1959, in the per-
sonal funds of patients trust fund on account of such vet-
eran shall not be paid to the personal representative of such 
veteran, but shall be paid to the following persons living 
at the time of settlement, and in the order named: The sur-
viving spouse, the children (without regard to age or mar-
ital status) in equal parts, and the dependent parents of 
such veteran, in equal parts. If any balance remains, such 
balance shall be deposited to the credit of the applicable cur-
rent appropriation; except that there may be paid only so 
much of such balance as may be necessary to reimburse a 
person (other than a political subdivision of the United 
States) who bore the expenses of last sickness or burial of 
the veteran for such expenses. No payment shall be made 
under the two preceding sentences of this subsection unless 
claim therefor is filed with the Secretary within five years 
after the death of the veteran, except that, if any person 
so entitled under said two sentences is under legal disability 
at the time of death of the veteran, such five-year period 
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of limitation shall run from the termination or removal of 
the legal disability. 
‘‘(e) ESCHEATMENT.—Any funds in the hands of a fi-
duciary appointed by a State court or the Secretary derived 
from benefits payable under laws administered by the Sec-
retary, which under the law of the State wherein the bene-
ficiary had last legal residence would escheat to the State, 
shall escheat to the United States and shall be returned by 
such fiduciary, or by the personal representative of the de-
ceased beneficiary, less legal expenses of any administration 
necessary to determine that an escheat is in order, to the 
Department, and shall be deposited to the credit of the ap-
plicable revolving fund, trust fund, or appropriation. 
‘‘(f) ASSISTANCE.—The Secretary shall provide to a fi-
duciary appointed under section 5502 of this title materials 
and tools to assist the fiduciary in carrying out the respon-
sibilities of the fiduciary under this chapter, including— 
‘‘(1) handbooks, brochures, or other written mate-
rial that explain the responsibilities of a fiduciary 
under this chapter; 
‘‘(2) tools located on an Internet website, includ-
ing forms to submit to the Secretary required infor-
mation; and 
‘‘(3) assistance provided by telephone.’’. 
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(2) CLERICAL AMENDMENT.—The table of sec-
tions at the beginning of chapter 55 of title 38, 
United States Code, is amended by inserting after the 
item relating to section 5502 the following new item: 
‘‘5502A. Supervision of fiduciaries.’’. 
(c) DEFINITION OF FIDUCIARY.—Section 5506 of title 
38, United States Code is amended— 
(1) by striking ‘‘For purposes’’ and inserting 
‘‘(a) For purposes’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(b)(1) For purposes of subsection (a), the term ‘per-
son’ includes any— 
‘‘(A) State or local government agency whose 
mission is to carry out income maintenance, social 
service, or health care-related activities; 
‘‘(B) any State or local government agency with 
fiduciary responsibilities; or 
‘‘(C) any nonprofit social service agency that the 
Secretary determines— 
‘‘(i) regularly provides services as a fidu-
ciary concurrently to five or more individuals; 
and 
‘‘(ii) is not a creditor of any such indi-
vidual. 
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‘‘(2) The Secretary shall maintain a list of State or 
local agencies and nonprofit social service agencies under 
paragraph (1) that are qualified to act as a fiduciary under 
this chapter. In maintaining such list, the Secretary may 
consult the lists maintained under section 807(h) of the So-
cial Security Act (42 U.S.C. 1007(h)).’’. 
(d) QUALIFICATIONS.—Section 5507 of title 38, United 
States Code, is amended to read as follows: 
‘‘§ 5507. Inquiry, investigations, and qualification of 
fiduciaries 
‘‘(a) INVESTIGATION.—Any certification of a person 
for payment of benefits of a beneficiary to that person as 
such beneficiary’s fiduciary under section 5502 of this title 
shall be made on the basis of— 
‘‘(1) an inquiry or investigation by the Secretary 
of the fitness of that person to serve as fiduciary for 
that beneficiary to be conducted in advance of such 
certification and in accordance with subsection (b); 
‘‘(2) adequate evidence that certification of that 
person as fiduciary for that beneficiary is in the in-
terest of such beneficiary (as determined by the Sec-
retary under regulations); 
‘‘(3) adequate evidence that the person to serve as 
fiduciary protects the private information of a bene-
ficiary in accordance with subsection (d)(1); and 
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‘‘(4) the furnishing of any bond that may be re-
quired by the Secretary in accordance with subsection 
(f). 
‘‘(b) ELEMENTS
OF INVESTIGATION.—(1) In con-
ducting an inquiry or investigation of a proposed fiduciary 
under subsection (a)(1), the Secretary shall conduct— 
‘‘(A) a face-to-face interview with the proposed 
fiduciary by not later than 30 days after the date on 
which such inquiry or investigation begins; and 
‘‘(B) a background check of the proposed fidu-
ciary to— 
‘‘(i) in accordance with paragraph (2), de-
termine whether the proposed fiduciary has been 
convicted of a crime; and 
‘‘(ii) determine whether the proposed fidu-
ciary will serve the best interest of the bene-
ficiary, including by conducting a credit check of 
the proposed fiduciary and checking the records 
under paragraph (5). 
‘‘(2) The Secretary shall request information con-
cerning whether that person has been convicted of any of-
fense under Federal or State law. If that person has been 
convicted of such an offense, the Secretary may certify the 
person as a fiduciary only if the Secretary finds that the 
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person is an appropriate person to act as fiduciary for the 
beneficiary concerned under the circumstances. 
‘‘(3) The Secretary shall conduct the background check 
described in paragraph (1)(B)— 
‘‘(A) each time a person is proposed to be a fidu-
ciary, regardless of whether the person is serving or 
has served as a fiduciary; and 
‘‘(B) at no expense to the beneficiary. 
‘‘(4) Each proposed fiduciary shall disclose to the Sec-
retary the number of beneficiaries that the fiduciary acts 
on behalf of. 
‘‘(5) The Secretary shall maintain records of any per-
son who has— 
‘‘(A) previously served as a fiduciary; and 
‘‘(B) had such fiduciary status revoked by the 
Secretary. 
‘‘(6)(A) If a fiduciary appointed by the Secretary is 
convicted of a crime described in subparagraph (B), the 
Secretary shall notify the beneficiary of such conviction by 
not later than 14 days after the date on which the Secretary 
learns of such conviction. 
‘‘(B) A crime described in this subparagraph is a 
crime— 
‘‘(i) for which the fiduciary is convicted while 
serving as a fiduciary for any person; 
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‘‘(ii) that is not included in a report submitted 
by the fiduciary under section 5509(a) of this title; 
and 
‘‘(iii) that the Secretary determines could affect 
the ability of the fiduciary to act on behalf of the ben-
eficiary. 
‘‘(c) INVESTIGATION OF CERTAIN PERSONS.—(1) In 
the case of a proposed fiduciary described in paragraph (2), 
the Secretary, in conducting an inquiry or investigation 
under subsection (a)(1), may carry out such inquiry or in-
vestigation on an expedited basis that may include giving 
priority to conducting such inquiry or investigation. Any 
such inquiry or investigation carried out on such an expe-
dited basis shall be carried out under regulations prescribed 
for purposes of this section. 
‘‘(2) Paragraph (1) applies with respect to a proposed 
fiduciary who is— 
‘‘(A) the parent (natural, adopted, or stepparent) 
of a beneficiary who is a minor; 
‘‘(B) the spouse or parent of an incompetent ben-
eficiary; 
‘‘(C) a person who has been appointed a fidu-
ciary of the beneficiary by a court of competent juris-
diction; 
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‘‘(D) being appointed to manage an estate where 
the annual amount of veterans benefits to be managed 
by the proposed fiduciary does not exceed $3,600, as 
adjusted pursuant to section 5312 of this title; or 
‘‘(E) a person who is authorized to act on behalf 
of the beneficiary under a durable power of attorney. 
‘‘(d) PROTECTION OF PRIVATE INFORMATION.—(1) A 
fiduciary shall take all reasonable precautions to— 
‘‘(A) protect the private information of a bene-
ficiary, including personally identifiable information; 
and 
‘‘(B) securely conducts financial transactions. 
‘‘(2) A fiduciary shall notify the Secretary of any ac-
tion of the fiduciary that compromises or potentially com-
promises the private information of a beneficiary. 
‘‘(e) POTENTIAL MISUSE OF FUNDS.—(1) If the Sec-
retary has reason to believe that a fiduciary may be mis-
using all or part of the benefit of a beneficiary, the Sec-
retary shall— 
‘‘(A) conduct a thorough investigation to deter-
mine the veracity of such belief; and 
‘‘(B) if such veracity is established, transmit to 
the officials described in paragraph (2) a report of 
such investigation. 
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