The Department of Veterans Affairs Office of Inspector General (OIG) recently uncovered issues with how the Veterans Benefits Administration (VBA) implemented cost of living adjustments (COLA) for disability compensation. This report highlights key findings and their impact on veterans.
Incorrect Calculations for Special Monthly Compensation
Intermediate SMC Levels COLA Miscalculated
The OIG found that since December 2016, VBA incorrectly calculated payment amounts for intermediate Special Monthly Compensation (SMC) levels. These levels, including SMC L1/2, M1/2, and N1/2, should be calculated as the average of two statutory payment amounts, rounded down to the nearest dollar 2.
Impact of COLA Miscalculations on Veterans
– Overpayments: Largest was 63 cents per month for SMC M1/2 (December 1, 2020)
– Underpayments: Largest was 39 cents per month for SMC M1/2 (December 1, 2023)
– Varying effects across different SMC levels and COLA implementations
VBA’s Response
The Compensation Service acknowledged the error and is working to identify affected cases. They plan to make adjustments to ensure underpaid veterans receive correct compensation.
Failure to Publish 2022 COLA Increases
Federal Register Publication Oversight
The Veterans’ Compensation COLA Act of 2022 required the VA Secretary to publish increased payment amounts for disability compensation, additional compensation for dependents, and clothing allowance in the Federal Register.
VBA’s Oversight
- Increased amounts were not published as required.
- VBA’s Office of Executive Review received the notice but failed to forward it for publication.
- Information was available on the VA’s website but not in the official Federal Register.
Key Takeaways
- VBA’s calculation errors, though small, highlight the need for stronger controls in benefit calculations.
- Proper publication of COLA increases in the Federal Register ensures transparency and official documentation.
- VBA has acknowledged these issues and is taking steps to address them.
- VBA’s Corrective Actions
- Addressing Calculation Errors
- Identifying impacted cases for review
- Reconciling records and correcting rates
- Ensuring underpaid veterans receive proper compensation
- Adjusting internal processes to prevent future calculation errors
Improving Publication Procedures
VBA’s Office of Executive Review updated its processes in September 2023 to ensure proper handling of Federal Register notices.
Conclusion
While the financial impact on individual veterans may have been minimal, these findings underscore the importance of accuracy and transparency in administering veterans’ benefits. VBA’s commitment to rectifying these issues and improving processes is a positive step towards ensuring veterans receive the correct benefits they’ve earned through their service. As the VA continues to serve millions of veterans, ongoing oversight and process improvements remain crucial. Veterans and their advocates should stay informed about benefit calculations and publications to ensure they receive accurate compensation.
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