Noteboom The Law Firm

18 Years of Disability Overpayments Total $1 Billion

January 28, 2011 - The Department of Veterans Affairs (VA) Office of the Inspector General (OIG) recently conducted an investigation into the possibility of overpayments of veterans' disability payments. What they found was astounding. Over the last 18 years, veterans' disability payments have been overpaid to the tune of almost $1 billion. If the system is not changed, there is no reason to believe overpayments of this magnitude will cease. 

The incredible amount of overpayments is rooted in the mishandling of almost 28,000 separate individuals' cases. All these cases were evaluated and handled by the Veterans Benefits Administration (VBA). Thousands of veterans were rated as 100% disabled temporarily, but continued to receive their 100% disabled disability compensation when they shouldn't have.    

The VBA has been audited multiple times since fiscal year 2004. Many reports made note of the VBA's staff failing to remain consistent in their processing of temporary 100% disability evaluations. Despite being told numerous times their staff were not correctly processing the claims, the VBA has failed to fix their issues. If they don't correct these oversights, the next 5 years will see the VBA overpaying veterans' disability claims to the tune of around $1.1 billion.

The problem is arising in the handling of temporary 100% disability ratings. These ratings are generally assigned to those veterans in need of special treatment or convalescence, or have a service-related injury. If those veterans can return to work, their disability compensation should either stop or become pro-rated. Of those cases OIG rated as problematic, follow-up doctor visits were never scheduled or paperwork never updated almost 50% of the time. This results in the veteran to continue to collect their 100% disability despite having recovered from their condition.

The VBA vehemently denies the numbers the OIG cited as being overpaid but noted they are correcting the problem by following the OIG's recommendations. As it stands, the VBA is not going to attempt to recover the overpayments.