VA's own watchdog found errors in 61% of PACT Act claim denials

The PACT Act -- the 2022 law VA itself calls perhaps the largest expansion of veterans' health care and benefits in its history -- opened a new path to compensation for veterans whose conditions can't be granted automatically ("presumptively") because they aren't on a pre-approved list.▸ For these "nonpresumptive" claims, a caseworker must instead verify the veteran took part in a toxic exposure risk activity (TERA) -- a category VA's own procedure calls "extremely broad," covering everything from solvents to burn-pit air pollutants -- and route the claim through a medical exam before ruling on it.

A VA Office of Inspector General statistical review of exactly these denials, examining a random sample of 60 decisions made from May through August 2023, found 37 had at least one processing error -- a projected 61 percent of the roughly 122,822 such denials VA issued in that four-month window alone.▸ The mechanism of harm isn't abstract: in one sampled case, VA denied a veteran's Agent Orange-linked prostate claim a week after receiving it, without ever ordering the toxic-exposure exam the claim was entitled to.

Before the PACT Act, a nonpresumptive claim was decided on the paper record alone.▸ Now, when a veteran claims -- or the record implies -- a condition tied to toxic exposure, VA's Veterans Benefits Administration (VBA) must run a specific sequence: identify that the claim touches TERA, check the veteran's exposure history in the Individual Longitudinal Exposure Record (ILER, a joint Defense Department-VA database covering more than six million veterans' deployment and occupational-hazard data), request a medical exam and opinion linking the condition to that exposure, and then discuss all of it -- explicitly -- in the written decision the veteran receives. Each step is a place a rushed or under-guided caseworker can drop the thread, and OIG's sample shows all four failure points in use: exams skipped when required, the ILER lookup skipped, the required internal memorandum documenting exposure left uncompleted, and -- the single most common failure -- the decision notice itself never mentioning that toxic exposure was considered at all.

OIG's 90-percent confidence interval for the error rate runs wide -- 46.3 percent to 73.6 percent -- because a 60-decision sample can only narrow an estimate so far; that width is a function of sample size, not evidence the true rate sits at either edge.▸ What steadies the finding is that VBA checked its own work independently and landed in the same neighborhood: in a fiscal year 2024 site-visit review, the agency's own consistency-and-oversight staff examined 40 PACT Act toxic-exposure cases and reported error rates of 70 percent for claims where exposure had been conceded and 40 percent for claims where it had not. Two different review teams, working from two different samples in two different years, both found VBA getting more than a third -- and by OIG's count, likely a majority -- of these decisions wrong.

Combining OIG's two sampling groups, the review team logged 86 distinct errors across the 60 decisions examined -- some decisions had more than one.▸ The largest single category, by a wide margin, was a decision that simply never discussed toxic exposure at all: 24 of the 86 errors were rating decisions where TERA should have been addressed and wasn't, leaving the veteran with no way to know whether their exposure claim was actually weighed or just overlooked. A missing case-tracking flag (17 errors) and a skipped exposure database check (8 errors) followed. The category OIG flags as most directly capable of costing a veteran their benefits -- a required exam or medical opinion that was never requested -- accounted for 11 of the 86, including the Agent Orange prostate case above.

VBA's Adjudication Procedures Manual is meant to be the one place claims processors go -- explicitly designed, per VBA's own prologue language, to be "reasonably complete" and "easy to understand and apply."▸ It isn't, for PACT Act nonpresumptive claims: when OIG began its review in October 2023, a separate internal VBA web page carried 43 links to the actual governing guidance -- an 82-page standard operating procedure, eight other policy documents, nine general-information documents, 19 job aids, and a 94-page FAQ -- and that guidance kept changing under processors' feet, with roughly four dozen prior versions archived as rescinded and replaced. Interviewed in January 2024, claims processors told OIG that finding the applicable rule across all those locations was time-consuming, and some said the difficulty may have contributed directly to the error rate OIG went on to measure.

The VA under secretary for benefits told Congress as much in May 2023, calling PACT Act claims "a massive new benefit" that added "new complexity to the work process... a new theory of entitlement [with] different effective dates and different conditions that are covered."▸ VBA has run two of its own internal reviews since -- one in early 2023, one across FY2024 -- and both surfaced errors; neither, per OIG, was followed by the root-cause analysis that would explain why they keep happening.

OIG issued three recommendations, and VBA concurred with all of them: review and correct every processing error the OIG team found on the cases it sampled and report back on the results; work with the VA Secretary's office, the Office of Field Operations, the Office of General Counsel, and the Board of Veterans' Appeals to fold PACT Act guidance into the single Adjudication Procedures Manual; and evaluate whether its existing controls for nonpresumptive TERA denials are strong enough, adding new ones where they aren't. None of the three commitments carries a completion date in VA's response -- "concurred" here means VBA agreed to act, not that it has.▸ OIG's own practice is to keep a recommendation open, and keep checking, until it receives evidence the action was actually taken; as of this review's publication, none had closed.