Handling Administrative Errors at the Chicago VA Regional Benefits Office in Illinois – REPORT #20-00102-73
Executive Summary
The VA Office of Inspector General (OIG) conducted this review based on a confidential allegation received in March 2019 that employees at the VA regional benefits office in Chicago, Illinois, were not following the Veterans Benefits Administration’s (VBA) procedures for correcting administrative errors. Generally, when VBA employees make mistakes that result in veterans being overpaid, the mistakes are considered administrative errors unless the veterans knew or should have known they were not entitled to the erroneous benefits. 1 Veterans are not responsible for repaying overpayments from administrative errors.2
Administrative errors can involve a wide range of issues, and VBA employees could find them in many claims-processing scenarios. VBA’s procedures for correcting administrative errors differ depending on the type of error.3 When VBA employees correct administrative errors, they must complete multiple steps, such as creating workload controls (assigning numeric codes to identify types of claims or actions needed), making and approving decisions, correcting errors in VBA’s electronic system, properly notifying veterans, and ensuring debts were not improperly created. The review team based its conclusions on the procedures in place at the time each error was corrected. However, after the review team began its work in October 2019, VBA modified its procedures related to correcting administrative errors in January, May, and June 2020.
What the Review Found
The OIG substantiated the allegation that Chicago VA regional benefits office employees did not follow VBA procedures when correcting administrative errors. The review team assessed all 16 cases completed from October 1, 2018, through September 30, 2019, in which employees corrected administrative errors, as indicated by the proper workload control.4 Employees did not, however, always use the proper workload control, so additional corrections may have been made. The OIG determined it would be impractical to identify all those cases. Still, the team did examine additional cases that were likely to have a significant impact on veterans where the probability that employees had corrected administrative errors was high. These were cases in which the Chicago VA regional benefits office created debts in veterans’ accounts at the same time the veterans’ disability levels were decreased. In these cases, employees had to reduce a past payment rate to create a debt, but disability levels are not generally decreased retroactively under VBA policy. The team found nine such cases, bringing the total cases reviewed to 25.
The team found claims processors did not properly correct administrative errors in 22 of 25 cases (88 percent). Some cases contained multiple errors, which affected the veterans’ benefits in different ways. 5 For example, one case had errors that caused the veteran to be both underpaid and overpaid. Errors affected veterans’ benefits in 13 cases, resulting in improper underpayments of about $59,100 to six veterans, improper overpayments of $18,900 to two veterans, and $5,900 in debts VA had inappropriately collected from eight veterans through January 2020. VBA concurred with all the OIG-identified errors.
Generally, errors occurred because claims processors did not sufficiently understand their responsibilities and procedures for correcting administrative errors. Some employees were unsure how to find administrative errors in prior decisions, which can occur in a wide range of claims-processing scenarios and may not be obvious. Employees also told the review team that correcting administrative errors can be complex because they do not work on these cases often and multiple steps are required. In addition, some stated that certain guidance for correcting administrative errors was unclear.
Beginning in January 2020, VBA made several updates to its procedures manual. These included more detailed instructions for controlling administrative errors, determining when administrative decisions are required, preventing debts from being created, ensuring benefits are paid through the correct date, and removing erroneous benefit information from the electronic system.6 In addition, VBA’s Compensation Service provided instructions for correcting administrative errors with examples in June 2020.
Chicago VA regional benefits office managers also increased oversight of administrative errors after the start of this review. They established a local SharePoint site to log administrative errors, appointed an administrative error coordinator, and limited the authority to approve certain administrative decisions to the veteran’s service center manager and his assistant. The regional benefits office also clarified responsibilities and procedures for correcting administrative errors by establishing a standard operating procedure, conducting training for veterans service representatives and distributing an administrative error guide to rating veterans service representatives and decision review officers.
What the OIG Recommended
The OIG recommended the director of the Chicago VA regional benefits office ensure the errors identified by the review team are corrected. The director should also monitor the effectiveness of the actions taken to improve the accuracy of corrections made to administrative errors and determine whether additional measures are needed.
Management Comments
The Chicago VA regional benefits office director concurred with both recommendations and provided acceptable action plans. The full text of the director’s comments is provided in Appendix C. The OIG will monitor the Chicago VA regional benefits office’s progress and follow up on the implementation of the recommendations until all proposed actions are completed.
1 VA Manual 21-1, part 3, sub. 5, chap. 1, sec. I, topic 3, “Handling Cases Involving Administrative Error,” May 7, 2020.
2 38 U.S.C. § 5112(b)(10); VA Manual 21-1, part 3, sub. 6, chap. 2, sec. B, topic 3, block e, “Eliminating an Overpayment Resulting From Correction of an Administrative Error,” October 11, 2017.
3 For general administrative errors, see VA Manual 21-1, “Handling Cases Involving Administrative Error.” For errors resulting from a rating decision, see VA Manual 21-1, part 4, sub. 2, chap. 3, sec. A, topic 2, “Correction of a Clear and Unmistakable Error That Will Not Benefit the Beneficiary,” June 3, 2020.
4 VBA calls these controls “end products,” which are the work units VBA uses to properly monitor and manage its workloads. End products have specific numeric codes to identify the types of claims or actions required. The numeric code used to indicate administrative errors is 960.
5 Unless otherwise noted, the term “error” used throughout this report refers to an improper action when correcting an administrative error.
6 VA Manual 21-1, “Handling Cases Involving Administrative Error”; VA Manual 21-1, “Correction of a Clear and Unmistakable Error That Will Not Benefit the Beneficiary.”
