House Report 112-241 - VETERANS' BENEFITS ACT OF 2011

[House Report 112-241]
[From the U.S. Government Publishing Office]

112th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 112-241

======================================================================

VETERANS' BENEFITS ACT OF 2011

_______

October 6, 2011.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed

_______

Mr. Miller of Florida, from the Committee on Veterans' Affairs,
submitted the following

R E P O R T

[To accompany H.R. 2349]

[Including cost estimate of the Congressional Budget Office]

The Committee on Veterans' Affairs, to whom was referred the
bill (H.R. 2349) to amend title 38, United States Code, to
direct the Secretary of Veterans Affairs to annually assess the
skills of certain employees and managers of the Veterans
Benefits Administration, and for other purposes, having
considered the same, report favorably thereon with amendments
and recommend that the bill as amended do pass.

CONTENTS

Page
Amendments....................................................... 2
Purpose and Summary.............................................. 5
Background and Need for Legislation.............................. 6
Hearings......................................................... 16
Subcommittee Consideration....................................... 17
Committee Consideration.......................................... 18
Committee Votes.................................................. 18
Committee Oversight Findings..................................... 18
Statement of General Performance Goals and Objectives............ 18
New Budget Authority, Entitlement Authority, and Tax Expenditures 18
Earmarks and Tax and Tariff Benefits............................. 18
Committee Cost Estimate.......................................... 19
Congressional Budget Office Estimate............................. 19
Federal Mandates Statement....................................... 23
Advisory Committee Statement..................................... 23
Letter of Jurisdiction Waiver from the House Judicary Committee.. 24
Statement of Constitutional Authority............................ 25
Applicability to Legislative Branch.............................. 25
Section-by-Section Analysis of the Legislation................... 25
Changes in Existing Law Made by the Bill as Reported............. 28

Amendments

The amendments are as follows:
Strike all after the enacting clause and insert the
following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Veterans' Benefits Act of 2011''.

SEC. 2. ASSESSMENT OF CLAIMS-PROCESSING SKILLS PILOT PROGRAM.

(a) Pilot Program.--Commencing not later than 180 days after the date
of the enactment of the Act, in addition to providing employee
certification under section 7732A of title 38, United States Code, the
Secretary of Veterans Affairs shall carry out a pilot program to assess
skills and provide training described under subsection (b).
(b) Biennial Skills Assessment and Individualized Training.--
(1) In general.--The Secretary shall--
(A) biennially assess the skills of appropriate
employees and managers of the Veterans Benefits
Administration who are responsible for processing
claims for compensation and pension benefits under the
laws administered by the Secretary, including by
requiring such employees and managers to take the
examination provided under section 7732A(a)(1) of title
38, United States Code; and
(B) on the basis of the results of such assessment
and examination, and on any relevant regional office
quality review, develop and implement an individualized
training plan related to such skills for each such
employee and manager.
(2) Remediation.--
(A) Remediation provided.--In providing training
under paragraph (1)(B), if any employee or manager
receives a less than satisfactory result on any portion
of an assessment under paragraph (1)(A), the Secretary
shall provide such employee or manager with remediation
of any deficiency in the skills related to such portion
of the assessment and, within a reasonable period
following the remediation, shall require the employee
or manager to take the examination again.
(B) Personnel actions.--In accordance with titles 5
and 38, United States Code, the Secretary shall take
appropriate personnel actions with respect to any
employee or manager who, after being given two
opportunities for remediation under subparagraph (A),
does not receive a satisfactory result on an assessment
under paragraph (1)(A).
(c) Locations and Duration.--The Secretary shall carry out the pilot
program under this section at five regional offices of the Veterans
Benefits Administration during the four-year period beginning on the
date of the commencement of the pilot program.
(d) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section a total of $5,000,000 for fiscal
years 2012 through 2016.
(e) Reports.--Not later than November 1 of each year in which the
pilot program under this section is carried out, the Secretary shall
submit to the Committee on Veterans' Affairs of the House of
Representatives and the Committee on Veterans' Affairs of the Senate a
report on any assessments and training conducted under this section
during the previous year. Each such report shall include--
(1) a summary of--
(A) the results of the assessments under subsection
(b)(1)(A);
(B) remediation provided under subsection (b)(2)(A);
and
(C) personnel actions taken under subsection
(b)(2)(B); and
(2) any changes made to the training program under subsection
(b)(1)(B) based on the results of such assessments and
remediation and the examinations provided under section
7732A(a)(1) of title 38, United States Code.

SEC. 3. EXCLUSION OF CERTAIN REIMBURSEMENTS OF EXPENSES FROM
DETERMINATION OF ANNUAL INCOME WITH RESPECT TO
PENSIONS FOR VETERANS AND SURVIVING SPOUSES AND
CHILDREN OF VETERANS.

(a) In General.--Paragraph (5) of section 1503(a) of title 38, United
States Code, is amended to read as follows:
``(5) payments regarding--
``(A) reimbursements of any kind (including insurance
settlement payments) for--
``(i) expenses related to the repayment,
replacement, or repair of equipment, vehicles,
items, money, or property resulting from--
``(I) any accident (as defined in
regulations which the Secretary shall
prescribe), but the amount excluded
under this subclause shall not exceed
the greater of the fair market value or
reasonable replacement value of the
equipment or vehicle involved at the
time immediately preceding the
accident;
``(II) any theft or loss (as defined
in regulations which the Secretary
shall prescribe), but the amount
excluded under this subclause shall not
exceed the greater of the fair market
value or reasonable replacement value
of the item or the amount of the money
(including legal tender of the United
States or of a foreign country)
involved at the time immediately
preceding the theft or loss; or
``(III) any casualty loss (as defined
in regulations which the Secretary
shall prescribe), but the amount
excluded under this subclause shall not
exceed the greater of the fair market
value or reasonable replacement value
of the property involved at the time
immediately preceding the casualty
loss; and
``(ii) medical expenses resulting from any
accident, theft, loss, or casualty loss (as
defined in regulations which the Secretary
shall prescribe), but the amount excluded under
this clause shall not exceed the costs of
medical care provided to the victim of the
accident, theft, loss, or casualty loss; and
``(B) pain and suffering (including insurance
settlement payments and general damages awarded by a
court) related to an accident, theft, loss, or casualty
loss, but the amount excluded under this subparagraph
shall not exceed an amount determined by the Secretary
on a case-by-case basis;''.
(b) Effective Date.--The amendment made by subsection (a) shall take
effect on the date that is one year after the date of the enactment of
this Act.
(c) Extension of Authority to Obtain Certain Information From
Department of Treasury.--Section 5317(g) of title 38, United States
Code, is amended by striking ``2011'' and inserting ``2013''.

SEC. 4. AUTHORIZATION OF USE OF ELECTRONIC COMMUNICATION TO PROVIDE
NOTICE TO CLAIMANTS FOR BENEFITS UNDER LAWS
ADMINISTERED BY THE SECRETARY OF VETERANS AFFAIRS.

(a) In General.--Section 5103 of title 38, United States Code, is
amended--
(1) in subsection (a)(1)--
(A) by striking ``Upon receipt of a complete or
substantially complete application, the'' and inserting
``The'';
(B) by striking ``notify'' and inserting ``provide
to''; and
(C) by inserting ``by the most effective means
available, including electronic communication or
notification in writing'' before ``of any
information''; and
(2) in subsection (b), by adding at the end the following new
paragraphs:
``(4) Nothing in this section shall require the Secretary to provide
notice for a subsequent claim that is filed while a previous claim is
pending if the notice previously provided for such pending claim--
``(A) provides sufficient notice of the information and
evidence necessary to substantiate such subsequent claim; and
``(B) was sent within one year of the date on which the
subsequent claim was filed.
``(5)(A) This section shall not apply to any claim or issue where the
Secretary may award the maximum benefit in accordance with this title
based on the evidence of record.
``(B) For purposes of this paragraph, the term `maximum benefit'
means the highest evaluation assignable in accordance with the evidence
of record, as long as such evaluation is supported by such evidence of
record at the time the decision is rendered.''.
(b) Construction.--Nothing in the amendments made by subsection (a)
shall be construed as eliminating any requirement with respect to the
contents of a notice under section 5103 of such title that are required
under regulations prescribed pursuant to subsection (a)(2) of such
section as of the date of the enactment of this Act.

SEC. 5. DUTY TO ASSIST CLAIMANTS IN OBTAINING PRIVATE RECORDS.

(a) In General.--Section 5103A(b) of title 38, United States Code, is
amended to read as follows:
``(b) Assistance in Obtaining Private Records.--(1) As part of the
assistance provided under subsection (a), the Secretary shall make
reasonable efforts to obtain relevant private records.
``(2)(A) Whenever the Secretary, after making such reasonable
efforts, is unable to obtain all of the relevant records sought, the
Secretary shall notify the claimant that the Secretary is unable to
obtain records with respect to the claim. Such a notification shall--
``(i) identify the records the Secretary is unable to obtain;
``(ii) briefly explain the efforts that the Secretary made to
obtain such records; and
``(iii) explain that the Secretary will decide the claim
based on the evidence of record but that this section does not
prohibit the submission of records at a later date if such
submission is otherwise allowed.
``(B) The Secretary shall make not less than two requests to a
custodian of a private record in order for an effort to obtain relevant
private records to be treated as reasonable under this section, unless
it is made evident by the first request that a second request would be
futile in obtaining such records.
``(3)(A) This section shall not apply if the evidence of record
allows for the Secretary to award the maximum benefit in accordance
with this title based on the evidence of record.
``(B) For purposes of this paragraph, the term `maximum benefit'
means the highest evaluation assignable in accordance with the evidence
of record, as long as such evaluation is supported by such evidence of
record at the time the decision is rendered.
``(4) Under regulations prescribed by the Secretary, the Secretary--
``(A) shall encourage claimants to submit relevant private
medical records of the claimant to the Secretary if such
submission does not burden the claimant; and
``(B) in obtaining relevant private records under paragraph
(1), may require the claimant to authorize the Secretary to
obtain such records if such authorization is required to comply
with Federal, State, or local law.''.
(b) Public Records.--Section 5103A(c) of such title is amended to
read as follows:
``(c) Obtaining Records for Compensation Claims.--(1) In the case of
a claim for disability compensation, the assistance provided by the
Secretary under this section shall include obtaining the following
records if relevant to the claim:
``(A) The claimant's service medical records and, if the
claimant has furnished the Secretary information sufficient to
locate such records, other relevant records pertaining to the
claimant's active military, naval, or air service that are held
or maintained by a governmental entity.
``(B) Records of relevant medical treatment or examination of
the claimant at Department health-care facilities or at the
expense of the Department, if the claimant furnishes
information sufficient to locate those records.
``(C) Any other relevant records held by any Federal
department or agency that the claimant adequately identifies
and authorizes the Secretary to obtain.
``(2) Whenever the Secretary attempts to obtain records from a
Federal department or agency under this subsection, the efforts to
obtain those records shall continue until the records are obtained
unless it is reasonably certain that such records do not exist or that
further efforts to obtain those records would be futile.''.

SEC. 6. CONDITIONS FOR TREATMENT OF CERTAIN PERSONS AS ADJUDICATED
MENTALLY INCOMPETENT FOR CERTAIN PURPOSES.

(a) In General.--Chapter 55 of title 38, United States Code, is
amended by adding at the end the following new section:

``Sec. 5511. Conditions for treatment of certain persons as adjudicated
mentally incompetent for certain purposes

``In any case arising out of the administration by the Secretary of
laws and benefits under this title, a person who is mentally
incapacitated, deemed mentally incompetent, or experiencing an extended
loss of consciousness shall not be considered adjudicated as a mental
defective under subsection (d)(4) or (g)(4) of section 922 of title 18
without the order or finding of a judge, magistrate, or other judicial
authority of competent jurisdiction that such person is a danger to
himself or herself or others.''.
(b) Clerical Amendment.--The table of sections at the beginning of
chapter 55 of such title is amended by adding at the end the following
new item:

``5511. Conditions for treatment of certain persons as adjudicated
mentally incompetent for certain purposes.''.

SEC. 7. REINSTATEMENT OF PENALTIES FOR CHARGING VETERANS UNAUTHORIZED
FEES.

(a) In General.--Section 5905 of title 38, United States Code, is
amended to read as follows:

``Sec. 5905. Penalty for certain acts

``Except as provided in section 5904 or 1984 of this title, whoever--
``(1) in connection with a proceeding before the Department,
knowingly solicits, contracts for, charges, or receives any fee
or compensation in connection for--
``(A) the provision of advice on how to file a claim
for benefits under the laws administered by the
Secretary; or
``(B) the preparation, presentation, or prosecution
of such a claim before the date on which a notice of
disagreement is filed in a proceeding on the claim,
or attempts to do so;
``(2) unlawfully withholds from any claimant or beneficiary
any part of a benefit or claim under the laws administered by
the Secretary that is allowed and due to the claimant or
beneficiary, or attempts to do so;
``(3) commits an offense punishable by this chapter, or aids,
abets, counsels, commands, or procures the commission of such
an act; or
``(4) causes an act to be done, which if directly performed
would be punishable by this chapter,
shall be fined as provided in title 18, or imprisoned for not more than
one year, or both.''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
with respect to acts committed after the date of the enactment of this
Act.

SEC. 8. PERFORMANCE AWARDS IN THE SENIOR EXECUTIVE SERVICE.

For each of fiscal years 2012 through 2016, the Secretary of Veterans
Affairs may not pay more than $2,000,000 in performance awards under
section 5384 of title 5, United States Code.

SEC. 9. BUDGETARY EFFECTS OF THIS ACT.

The budgetary effects of this Act, for the purpose of complying with
the Statutory Pay-As-You-Go-Act of 2010, shall be determined by
reference to the latest statement titled ``Budgetary Effects of PAYGO
Legislation'' for this Act, submitted for printing in the Congressional
Record by the Chairman of the House Budget Committee, provided that
such statement has been submitted prior to the vote on passage.

Amend the title so as to read:

A bill to amend title 38, United States Code, to improve
the determination of annual income with respect to pensions for
certain veterans, to direct the Secretary of Veterans Affairs
to establish a pilot program to assess the skills of certain
employees and managers of the Veterans Benefits Administration,
and for other purposes.

Purpose and Summary

H.R. 2349 was introduced on June 24, 2011, by
Representative Jon Runyan of New Jersey. H.R. 2349, as amended,
would amend title 38, United States Code, to make certain
improvements in the laws administered by the Secretary of
Veterans Affairs (VA).
H.R. 2349, as amended, is comprised of a number of bills
introduced in the 112th Congress. These bills include: H.R.
2349; H.R. 923, a bill to amend title 38, United States Code,
to exempt reimbursements of expenses related to accident,
theft, loss, or casualty loss from determinations of annual
income with respect to pensions for veterans and surviving
spouses and children of veterans, and for other purposes,
introduced by Represenative Alcee Hastings of Florida; H.R.
2383, a bill to amend title 38, United States Code, to
authorize the Secretary of Veterans Affairs to use electronic
communication to provide required notice to claimants for
benefits under laws administered by the Secretary, and for
other purposes, introduced by Represenative Bill Johnson of
Ohio; H.R. 1898, a bill to amend title 38, United States Code,
to clarify the conditions under which certain persons may be
treated as adjudicated mentally incompetent for certain
purposes, introduced by Represenative Denny Rehberg of Montana;
and a free-standing provision to establish an authorization cap
of $2,000,000 for each of fiscal years 2012 through 2016 on
performance awards payable to VA employees in the Senior
Executive Service.

Background and Need for Legislation

Section 2--Assessment of Claims-Processing Skills Pilot Program

Section 7732A of title 38, United States Code, currently
requires employees and managers of the Veterans Benefits
Administration (VBA) who are responsible for processing claims
for compensation and pension benefits to undergo a
certification examination. The mandate for employee
certification had its genesis in the 110th Congress in
legislation introduced by Representative John Hall of New York,
the Chairman of the Disability Assistance and Memorial Affairs
Subcommittee. In justifying the certification mandate, the
Committee report accompanying the legislation (H.R. 5892), H.
Rept. 110-789, pointed out that ``gaps in training and
inconsistencies between the [VA Regional Offices] clearly
persist'' in spite of the VA's plan to ``require at least 80
hours of training for each employee and centralize the training
program at its National Training Academy in Baltimore.'' In
discussing the Systematic Technical Accuracy Review (STAR)
program and the VA's response to these reviews, the Committee
noted that ``[i]t is uncertain what additional training is
conducted or whether or not there is any level of
accountability for an individual [VA Regional Office] when
mistakes are made.'' The Committee noted near the beginning of
its account of the background underlying section 105 of H.R.
5892 that ``certification testing is an appropriate means to
measure an employee's qualifications and skills and should be a
part of VA's human resources evaluation system.'' The Veterans'
Benefits Improvement Act of 2008, Public Law 110-389, 122 Stat.
4145, contained modified language from section 105 of H.R.
5892.
In implementing the mandate of Public Law 110-389, VA has
used certification testing as a means to gauge whether certain
employees should advance in pay grade, rather than using
certification as a means to measure performance, ensure
accountability, and reinforce required training at the
individual level. Although testing to certify proficiency in a
subject matter is certainly a worthwhile standard for
promotion, the Committee believes that certification testing
could be used to more broadly influence the type of training or
remediation necessary at the individual employee level. Indeed,
VA's own performance measures suggest that different approaches
are needed. From January of 2009 to September of 2011, there
has been a 99 percent increase in the reported backlog of
claims for disability benefits. Over that same period, the
average number of days to complete a claim rose from 160.7 days
in fiscal year (FY) 2009 to 182.2 in FY 2011. Accuracy of
claims decisions has been stagnant at 84 percent over the last
3 years, well below VA's stated goal of 98 percent.
The Committee is sensitive to concerns expressed by VA
regarding the costs and management difficulties associated with
annual testing of every employee, with follow-up remediation,
at every Regional Office (RO). Therefore, section 2 of H.R.
2349, as amended, allows for VA to take a more deliberate
approach to skills assessments by requiring biennial
assessments of appropriate employees and managers at only five
Regional Offices from 2012 through 2016. The assessments would
be required of appropriate employees and managers responsible
for processing claims for compensation and pension benefits. If
employees or managers receive a less-than-satisfactory score on
the assessment exam, VA would be required to provide
appropriate remediation training so that the assessment exam
could be taken again. If after remediation an employee or
manager again gets a less-than-satisfactory score, VA would
then be required to take appropriate personnel actions. Section
2 would authorize $5 million over five years to carry out the
biennial assessments, the results of which VA would be required
to report to Congress.

Section 3--Exclusion of certain reimbursements of expenses from
determiniation of annual income with respect to pensions for
veterans and surviving spouses and children of veterans

The purpose of VA pension benefits is to ensure that
wartime veterans with limited means, who are unable to work due
to age or non service-connected disability, have a minimum
level of income support. Certain spouses and dependent children
are also eligible for VA pension. In assessing a claimant's
eligibility for pension benefits, VA must determine annual
countable income, then calculate and pay a pension benefit that
is equal to the difference between countable income and the
maximum allowable pension level established in law. In order to
verify certain kinds of countable income to ensure accurate
pension payments, VA uses existing legal authority to match
income data it receives with data possessed by the Internal
Revenue Service. However, that legal authority is set to expire
on November 18, 2011.
Current law exempts from income determinations
reimbursements for any kind of ``casualty loss,'' which is
defined in VA regulation as ``the complete or partial
destruction of property resulting from an identifiable event of
a sudden, unexpected or unusual nature.'' However, current law
does not exempt from income determinations reimbursements
received as a result of accident, theft, or ordinary loss, and
it does not exempt from income determinations reimbursements
received as a result of pain and suffering associated with a
casualty loss. Thus, if a pension recipient receives
reimbursement from an insurance company for these items, it may
cause an immediate reduction or elimination of monthly VA
pension, even though the recipient may have needed to use
proceeds from the insurance reimbursement to cover immediate or
near-term expenses related to the casualty loss, such as
purchasing a replacement automobile. The Committee believes
that it is appropriate to have some measure of flexibility in
these instances so that those who depend on monthly VA pension
to survive are not punished when they suffer from an accident
or loss.
Section 3 would prevent the offset of pension benefits for
veterans, surviving spouses and children of veterans due to the
receipt of payments by insurance, court award, settlement or
other means to reimburse expenses incurred after an accident,
theft, loss, or casualty. Section 3 would also exempt ``pain
and suffering'' income from pension calculations, but only in
amounts determined by VA on a case-by-case basis. It is the
Committee's hope that the individual facts of a case will
enable VA to exempt an amount for pain and suffering that is in
keeping with the intended purpose of VA pension.
Section 3 would also extend the authority of VA to verify
income information with the Internal Revenue Service to
November 18, 2013.

Section 4--Authorization of use of electronic communications to provide
notice to claimants for benefits under laws administered by the
Secretary of Veterans Affairs.

Section 5103 of title 38, United States Code, requires VA,
upon receipt of a complete or substantially complete
application from a claimant seeking any benefit from VA, to
issue a written notice to claimants requesting evidence needed
to substantiate their claims. Section 5103 further requires VA
to issue a separate written notice to claimants upon receipt of
any subsequent claims, regardless of whether the information
contained in a subsequent notice is different from any prior
notices issued.
This written notice, commonly referred to as a ``notice of
responsibility'' or ``VCAA notice'' because of its origin
within the Veterans Claims Assistance Act of 2000, Public Law
106-475, 114 Stat. 2096, requires a statement as to the issue
or issues being claimed, lists the evidence the claimant wishes
to be considered, and informs the claimant if there is any
additional information or evidence required, including private
medical treatment records for service connection, secondary
service connection, increased evaluations, individual
unemployability, or other claims. The VCAA notice further
requests that the claimant complete and return a VA Form 21-
4142 (``Authorization and Consent to Release Information'')
authorizing VA to obtain private medical treatment records. The
claimant is also asked to include detailed information
regarding health provider, facilities, findings and diagnoses.
The claimant is further instructed to identify any VA medical
treatment, including dates and specific facilities, so VA can
obtain those medical records. Additionally, the claimant is
informed he or she may provide a statement regarding the
claimed condition or conditions as well as lay records
including statements from persons with knowledge of how the
claimed condition or conditions may affect the claimant.
Information contained in the VCAA notice includes specific
time periods in which additional information or evidence must
be received and what actions VA has already taken, such as
requesting records or a medical examination from a VA medical
center. The notice also informs the claimant that, should the
VA medical examination be missed without good cause, VA may
move forward and decide the claim based on the evidence of
record.
The VCAA notice also outlines VA's duty to assist the
claimant in obtaining evidence, including what steps the VA
will take, and explains the role the claimant can play to
ensure all relevant evidence is submitted for consideration.
The VCAA notice explains how a disability rating and effective
date will be determined. Finally, each VCAA notice contains a
VCAA Notice Response Form, which identifies the date of claim
and provides a brief explanation regarding the submission of
any additional information or evidence. If the claimant has
nothing further to submit in support of the claim, he or she
may elect to have the claim decided as soon as possible, which
may alleviate unnecessary delays in processing, or the claimant
may elect to submit additional information or evidence.
VA, in testimony before the Subcommittee on Oversight and
Investigations on July 20, 2011, noted the unintended
consequences, including court interpretations, of VCAA that
have resulted in delays in claims processing instead of
creating ``more efficient and effective development of claims''
as originally intended. The Committee believes that sensible
modifications to VCAA can be made without undoing the intent of
VCAA, while also expediting the claims process.
Accordingly, section 4 of H.R. 2349, as amended, would
remove the requirement that the VCAA notice be sent only after
receipt of a claim, thereby allowing VA to put notice on new
claims forms, as is currently done with the Department's 526-EZ
form for Fully Developed Claims (FDC). Together with the
provisions in Section 5 of H.R. 2349, as amended, which would
authorize VA to encourage veterans to gather and submit private
medical records in support of their claims, some veterans could
be encouraged to take additional time to find, procure, and
submit private medical evidence before submitting their claim.
VA must ensure that veterans are adequately informed that they
have the right to submit an informal claim for the purpose of
establishing an earlier effective date in rewriting new
application forms. Such information is currently included on
the 526-EZ form for those filing under the FDC program, and it
should similarly be included for those submitting standard non-
FDC forms to ensure that veterans do not lose any benefit.
Although not its central purpose, current VCAA notice
provides a claimant with an acknowledgement that the claim was
received and is being processed. Upon enactment of section 4,
it is imperative that when VA moves the VCAA notice onto the
application form itself, it continues to keep in place a system
that acknowledges receipt of all submitted claims. Currently,
the VBA has stated that most ROs send out such letters
acknowledging receipt of claims, and that such a system could
be implemented throughout the remaining ROs.
For claimants who file electronically, the acknowledgement
of receipt can easily be auto-generated and delivered via email
or other means, as chosen by the veterans during the
application process. However, as long as veterans may file
claims on paper forms or other non-electronic means, it is
imperative that VA also continue to send acknowledgement of
receipt of claims. In addition, to the extent feasible, VA
should include a listing of any other records or evidence that
was submitted along with the claim.
The requirement that VA issue a separate written VCAA
notice upon receipt of any subsequent claim presents two issues
that contribute to the claims backlog. The first is that, in
many cases, VA is forced to take a redundant step of producing
the exact same notice it has already provided to the veteran,
which increases the processing time without affecting the
outcome of the claim.
The second issue is that the notices provided by VA must be
in writing and mailed through the postal system. Because it is
not authorized to do so, VA cannot utilize the speed and
efficiency provided by electronic mail, even if that were the
claimant's preferred method of communication regarding the
claim. This restriction of VA's means of communication prevents
it from utilizing a widely-used and accepted form of efficient
and timely correspondence.
Section 4 of H.R. 2349, as amended, would correct both of
these inefficiencies in two ways. First, it would authorize VA
to use the most effective means available for communication,
including electronic or written communication. Second, section
4 would remove the requirement that VA send a notice for a
subsequent claim if the issue is already covered under a
previous claim. However, under this section, VA would still be
required to send a notice if over one year has passed since any
notice of responsibility was last sent to the claimant,
ensuring easier tracking of a claim by the veteran.
Authorizing the use of the most effective means available
for communication would allow VA the option of sending a notice
of responsibility to the claimant using either electronic
correspondence or written correspondence. This section contains
no requirement limiting correspondence to electronic mail. With
its enactment, VA would have the ability to communicate quickly
and efficiently with claimants. VA would no longer be
statutorily restricted in its means of communicating with
claimants, nor would it still be subject to the inherent added
time of only using written mail delivered through the postal
system.
As VA continues modernizing toward an electronic and
paperless system of filing, adjudicating, and awarding claims
for benefits, it must ensure that veterans retain the ability
to choose the best means of communicating with VA. For those
who file their online claims, they should be given an option to
opt-out of electronic communications and those who file via
non-electronic means should be given the opportunity to opt-in
to electronic communication. Further, as VA integrates VCAA
notice into the online claims application process, it must also
take special care to do so in a manner that assures the
greatest likelihood that veterans will read and understand such
online notice. In order to maintain the value of the VCAA
notice, VA must carefully consider how best to present such
notice during an online application process, such as dividing
the notice into sections and highlighting key parts of the
notice on relevant screens during the application process.
Section 4 contains added protections for veterans with the
inclusion of a provision specifying that nothing in the
legislation shall change the contents of the notice provided to
claimants. While providing a notice of responsibility to a
claimant electronically is a different medium from a notice
written on paper, and therefore the visual appearance would
likely be different, the purpose of the notice would remain the
same.
Removing the requirement that an additional notice for a
subsequent claim be provided when the issue is covered under
the original claim is a straightforward method of saving
valuable time in processing a claim. As noted above, VA is
required to send a notice of responsibility to a claimant for
the initial claim as well as any subsequent claims. However,
many of these notices are identical to what had already been
sent to the claimant, and often the subsequent claim is covered
under the initial claim. Therefore, VA can sometimes send
multiple copies of the exact same notice of responsibility to a
claimant, even though the final result is not affected. By
reducing the unnecessary actions taken by claims processors,
overall processing time is also reduced. However, Section 4
does contain a requirement that VA send a notice of
responsibility for a subsequent claim if the previous notice
was sent more than one year prior. The Committee considers this
provision helpful to claimants in monitoring progress of
claims.
Section 4 of H.R. 2349, as amended, would further amend
section 5103 of title 38, United States Code, by authorizing VA
to waive the requirements for issuing a VCAA notice when ``the
Secretary may award the maximum benefit in accordance with this
title based on the evidence of record.'' This provision will
eliminate delays that occur when a VCAA notice would be sent in
connection with claims for which VA will award a benefit, and
when such notice has little likelihood of leading to a higher
level of benefit. Under the definition of ``maximum'' in
section 4, it is clear that before VA could make such an award,
it must have evidence that is sufficient to meet all aspects of
the rating schedule for each condition.
This provision is intended to reduce the number of
situations wherein VA spends unnecessary time and resources to
pursue private medical records that may already have been
submitted in the claimant's file, may not exist, may not be
obtainable, are not relevant to the claim or, even if obtained,
are highly unlikely to change the rating that would otherwise
be assigned based on the evidence of record. The provision is
not in any way intended to encourage VA to speed claims through
the process by waiving VCAA notice requirements when fulfilling
these duties could result in a higher rating for veterans, nor
is the provision constructed that way. With enactment of this
legislation, VA would continue to have an obligation to obtain
or assist veterans in obtaining relevant medical records, both
public and private, but it would be able to do so in a more
efficient manner by removing the requirement to seek
irrelevant, duplicative, or unnecessary records that do not
substantiate a claim.
In implementing this new authority, it is important that VA
continue to provide VCAA notice when such notice and assistance
could lead to a higher benefit for the veterans. It is the
Committee's expectation that with this new authority, VA would
continue to obtain all records that are in the constructive
custody of governmental entities, agencies, or departments,
such as military health records. Further, VA would continue to
be obligated to seek to obtain private medical records that
veterans ask VA to obtain by completing the requisite medical
release forms, unless such records are not relevant to the
claim. In determining the relevancy of evidence, the Committee
would expect that VA would instruct its employees that the
threshold question would be whether the veteran could be harmed
in any way if the evidence is not obtained.
In the judgment of the Committee, the following are
examples of records that would normally be considered
irrelevant, and for which VA would no longer be obligated to
provide assistance in obtaining:
(1) The medical release form (currently VA Form 21-
4142) indicates treatment for an issue that is not
being claimed by the veteran;
(2) The VA Form 21-4142 indicates treatment for a
claimed condition 20 years ago, when service-connection
can be granted with records present in the claims
folder, and there's no possibility that an earlier
effective date can be established with the requested
records; or
(3) The VA Form 21-4142 indicates that the same
treatment records are already present in the claims
folder.
In implementing this section, the Committee would expect VA
to include in the claims decision and award letter information
regarding when it determined that records properly identified
to VA on a medical release form are not relevant to the
veteran's claim, including the reasons for such determination.
Such information would allow the veteran or the veteran's
representative, if any, to better understand how VA reached its
decision in a timely manner.

Section 5--Duty to assist claimants in obtaining private records

Section 5103A of title 38, United States Code, outlines
VA's duty to assist claimants in obtaining evidence needed to
substantiate a claim. Under current law, VA must make
``reasonable efforts'' to obtain private medical records on
behalf of a claimant who adequately identifies and authorizes
VA to obtain them. What constitutes a ``reasonable effort'' by
VA to obtain private medical records on behalf of a claimant is
undefined. VA historically has made multiple attempts for each
claimant to obtain private medical records out of concern that
courts might construe VA's imposition of a defined limit as a
violation of the statute. Such uncertainty, and resulting
multiple requests of private medical evidence, unnecessarily
delays final resolution to a claim.
Section 5 would establish a standard of reasonableness for
requests for private records as ``not less than two requests.''
Quantifying a reasonable number of requests removes the
uncertainty and latitude for interpretation, and provides more
certainty that an initial attempt was not possibly overlooked
or misplaced by a custodian of private medical records, or sent
to an incorrect address. In addition, if a first request is
received by a custodian of private medical records who can
definitively respond that they no longer have the records, the
Department can refocus its efforts at developing a claim with
the evidence that can be obtained. Section 5 would further
clarify, for the veteran's protection, that the veteran retains
the ability to submit additional evidence at a later date
should it be obtained.
Section 5 would also remove an additional administrative
obstacle to claims development. As with Section 4 of H.R. 2349,
as amended, this section would authorize VA to waive its duty
to assist requirements when ``the Secretary may award the
maximum benefit in accordance with this title based on the
evidence of record.'' The effect of this provision would
prevent both the claimant and VA from having to collect further
evidence that would have no impact on the claim. Under the
definition of ``maximum'' benefit, it is clear that before VA
could make such an award, it must have evidence that is
sufficient to meet all aspects of the rating schedule for each
condition.
As with the similar provision in Section 4, this provision
is intended to reduce the number of situations wherein VA
spends unnecessary time and resources to pursue private medical
records that may already have been submitted in the claimant's
file, may not exist, may not be obtainable, are not relevant to
the claim or even if obtained are highly unlikely to change the
rating that would otherwise be assigned based on the evidence
of record. It must not be used to speed claims through the
process by waiving notice or duty to assist requirements when
fulfilling these duties could result in a higher rating for
veterans. The Committee believes that with enactment of this
legislation, VA would continue to have an obligation to obtain
or assist veterans in obtaining relevant medical records, both
public and private, but it would be able to do so in a smarter
manner so that VA stops chasing irrelevant, duplicative or
unnecessary records. This provision makes clear that the
purpose of VA's duty to assist should be limited to situations
where it will actually assist veterans in substantiating their
claims.
Section 5 would also add a provision to encourage claimants
to take a proactive role in the claims process. By encouraging
``claimants to submit relevant private medical records of the
claimant to the Secretary if such submission does not burden
the claimant,'' the collection of evidence necessary to render
a decision can be greatly facilitated. A claimant's knowledge
of where certain medical records may be located is invaluable
to claim development, and in many cases a claimant can
identify, obtain, and submit that evidence more quickly than if
VA were to receive a claim and subsequently endeavored to
locate and request those same records. It follows that
facilitating the development portion of the claims process can
facilitate the claims process overall, and awarding of
decisions to claimants could be made in a more timely fashion.

Section 6--Conditions for treatment of certain persons as adjudicated
mentally incompetent for certain purposes

The following background material is taken from S. Rpt.
111-27 in its description of S. 669, a bill reported from the
Senate Committee on Veterans' Affairs during the 111th Congress
that is identical to the language within section 6 of H.R.
2349, as amended:

The Federal Gun Control Act of 1968 (hereinafter, ``GCA''),
Public Law 90-618, 82 Stat. 1213, and subsequent amendments
established categories of persons who are prohibited from
receiving or possessing firearms. Included among the categories
is any person who has been ``adjudicated as a mental defective
or who has been committed to a mental institution.'' Part
478.11 of title 27, Code of Federal Regulations, defines the
meaning of ``adjudicated as a mental defective'' as follows:
(a) a determination by a court, board, commission, or other
lawful authority that a person, as a result of marked subnormal
intelligence, or mental illness, incompetency, condition, or
disease:
(1) is a danger to himself or to others; or
(2) lacks the mental capacity to contract or manage
his own affairs.
The Brady Handgun Violence Prevention Act of 1993
(hereinafter, the ``Brady Act''), Public Law 103-159, 107 Stat.
1536, required the Attorney General to establish a system to
assist federally licensed gun dealers in determining whether a
gun buyer is prohibited under the GCA from purchasing a
firearm. The system developed pursuant to the Brady Act, the
[National Instant Criminal Background Check System] NICS, is a
computerized database operated by the FBI NICS Section. The
NICS can be queried by gun dealers to determine whether the
name of a prospective buyer is on the list and, therefore,
legally prohibited from purchasing a firearm.
The Brady Act also requires Federal agencies, upon the
request of the Attorney General, to submit to the FBI
information on persons prohibited from purchasing a firearm.
The Attorney General made such a request to VA in 1998. Under a
Memorandum of Understanding entered into between the FBI and
VA, VA agreed to make available for inclusion on the NICS
database information about VA beneficiaries who are determined
to be mentally incompetent on account of their inability to
contract or manage their own affairs pursuant to part 3.353 of
title 38, Code of Federal Regulations. Determinations of
incompetency under part 3.353 result in an appointment of a
fiduciary.
The evidence gathered to support a finding of incompetency,
under part 3.353 of VA's regulations, is used to inform a
judgment about whether a beneficiary is capable of managing
their VA benefit payments. No evidence is gathered as part of
this process to inform a judgment about whether a beneficiary
presents a danger to themselves or others, or whether they
should be prohibited from purchasing, possessing, or operating
a firearm. Furthermore, although beneficiaries are entitled to
a hearing once notified that it is proposed they will be
determined incompetent, the initial hearing is before VA
personnel, not an independent authority. From the date of the
initial request of the Attorney General through October, 2007,
VA has shared information with NICS on over 116,000 individuals
for whom it has appointed a fiduciary. VA was unable to provide
the Committee with updated information about how many
additional names have been added or removed from NICS since
October 2007. Despite the fact that other agencies, such as the
Social Security Administration, appoint fiduciaries to manage
benefit payments for their beneficiaries in a manner similar to
VA's process, VA beneficiaries constitute the overwhelming
majority of individuals referred to the FBI by the Federal
Government.

Testimony submitted by the Reserve Officers Association
(ROA) in connection with the Subcommittee on Disability
Assistance and Memorial Affairs hearing on July 7, 2011,
pointed out the risks of VA assigning labels through an
administrative process to those who have served in the
military, which only serve to inflame the public's distrust of
the mental capacity of those same individuals. In this case,
VA's designation of veterans appointed a fiduciary as
``mentally incompetent'' automatically attaches to it a
placement on the NICS list, a list filled with criminals and
others who have demonstrated through their actions that they
present a danger to society. The GCA process VA has been
directed to follow unfairly labels veterans as potentially
dangerous without appropriate due process.
The Committee is in absolute agreement that individuals who
are a danger to themselves or others should not be permitted to
own or possess a firearm. However, the Committee is deeply
troubled with what appears to be an arbitrary and
discriminatory process that allows a non-judicial authority to
presume individuals seeking help from VA as threats to society
when they may only need help managing their financial affairs.
The Committee believes a rational process, in an appropriate
forum, is an absolute necessity before Constitutional rights
are abridged for any American, but especially America's
veterans.
Accordingly, section 6 would clarify that in any case
arising out of VA's administration of benefits under title 38,
a VA beneficiary who is mentally incapacitated, deemed mentally
incompetent, or experiencing an extended loss of consciousness,
shall not be considered adjudicated as a mental defective under
the GCA without the order or finding of a judge, magistrate, or
other judicial authority of competent jurisdiction that such
individual is a danger to him- or herself or others.

Section 7--Reinstatement of penalties for charging veterans
unauthorized fees

Chapter 59 of title 38, United States Code, establishes
policies and procedures with respect to individuals acting as
agents and attorneys before VA. In general, an agent or
attorney must be recognized by VA in order to act in the
preparation, presentation, or prosecution of a claim before VA.
Further, VA is authorized to recognize representatives of
certain organizations to act in that capacity for claims before
VA and to recognize an individual for purposes of a specific
claim before VA. VA may suspend or exclude an individual from
practicing before VA for any of the reasons set forth in
section 5904(b) of title 38, United States Code. Section
5904(c) of title 38 generally provides that an agent or
attorney may not charge a fee for services ``provided before
the date on which a notice of disagreement is filed with
respect to the case.'' Finally, Section 5905 of title 38
specifies that whoever wrongfully withholds from any claimant
or beneficiary any part of a benefit or claim allowed and due
to the claimant or beneficiary, shall be fined as provided in
title 18, or imprisoned not more than one year, or both.
The purpose of existing law is to protect veterans from
being charged excessive fees for aid in prosecuting
applications to VA for benefits under various statutes passed
for their relief and assistance. Further, the law is designed
to prevent unscrupulous persons from receiving compensation or
fees for obtaining benefits for veterans from VA.
Recent investigative news reports and testimony before the
Committee has identified that since 2006, there has been an
increase in non-accredited individuals, organizations and
private companies that have been taking advantage of veterans
by charging fees to assist them with filing claims for
veterans' benefits with the VA that may or may not have
actually been filed. Since these individuals, groups and
companies are not accredited, suspension and disbarment are not
a viable deterrent and the language of existing law provides
little avenue for successful prosecution of these unscrupulous
individuals.
Accordingly, section 7 would provide the Secretary of VA
and the Department of Justice with the appropriate tools to
effectively and successfully prosecute these individuals,
groups and companies that are preying on our veterans
population, often at the time they are most vulnerable and in
need of assistance.

Section 8--Performance awards in the Senior Executive Service

In an acknowledgment of the damage that unrestrained
government spending has wrought on the national economy, one of
the first actions of the 112th Congress was to adopt a 5
percent budget cut for Congressional offices. A further 6
percent cut is anticipated for FY 2012. In addition, a freeze
on raises in Federal employee pay is in effect through 2012.
Despite this step toward fiscal restraint, VA reserved the
right to offer pay increases, performance awards, and bonuses
to certain health care and information technology employees. In
response to pre-hearing questions for the record submitted by
Chairman Jeff Miller in connection with the Committee's
February 17, 2011, hearing on VA's Fiscal Year 2012 budget, VA
cited a need for these bonuses to improve its ability to retain
such employees.
However, Committee investigations and news reports
discovered that this type of employee was not always the
recipient of these bonuses. Committee investigations uncovered
bonuses being paid to facility directors with multiple
citations of mismanagement, and news reports showed large
retention bonuses being paid to medical facility directors who
were at or near retirement.
Section 5384 of title 5, United States Code, sets out the
authority for Federal agencies to allocate performance
incentives to employees of the Senior Executive Service (SES).
According to information supplied by VA, 221 SES bonuses were
awarded in FY 2008 at a total cost of $3,816,330; 219 bonuses
were awarded in FY 2009 at a total cost of $3,728,536; and 227
bonuses were awarded in FY 2010 at a total cost of $3,342,100.
At a time when the entire Legislative Branch is reducing
spending, and many Executive Branch employees will not see pay
increases, it is appropriate that VA reevaluate its entire
bonus program and exercise restraint in its awarding of
bonuses.
In order to facilitate that reevaluation, section 8 would
establish for each of fiscal years 2012 through 2016, an annual
authorized amount of bonuses and performance awards payable to
VA employees within the Senior Executive Service. The cap
established would be $2,000,000 per year, a reduction from the
3-year average of over $3,500,000.

Hearings

On July 7, 2011, the Subcommittee on Disability Assistance
and Memorial Affairs conducted a legislative hearing on various
bills introduced during the 112th Congress, including: H.R.
923, H.R. 1025, H.R. 1826, H.R. 1898, and H.R. 2349. The
following witnesses testified: Mr. Raymond Kelley, Director,
National Legislative Service of the Veterans of Foreign Wars of
the United States; Mr. Ian de Planque, Deputy Director,
National Legislative Commission of The American Legion; Mr.
Jeffrey C. Hall, Assistant National Legislative Director,
Disabled American Veterans; Mr. Al Garver, Executive Director
of the Enlisted Association of the National Guard of the United
States; Mr. Jimmy F. Sims, Jr., Rating Veteran Service
Represenative of the Veterans Benefits Administration Regional
Office, Winston-Salem, NC, and Steward, Local 1738 of the
American Federation of Government Employees; Mr. Richard Paul
Cohen, Esq., Executive Director of the National Organization of
Veterans' Advocates, Inc.; and Mr. Thomas Murphy, Director of
the Compensation Service, Veterans Benefits Administration of
the U.S. Department of Veterans Affairs, accompanied by Mr.
Richard J. Hipolit Assistant General Counsel, Office of General
Counsel of the U.S. Department of Veterans Affairs. The
Paralyzed Veterans of America, and the Reserve Officers
Association of the United States and Reserve Enlisted
Association of the United States submitted statements for the
record.
On July 20, 2011, the Subcommittee on Oversight and
Investigation conducted a legislative hearing on various bills
introduced during the 112th Congress, including: H.R. 2383,
H.R. 2243, and H.R. 2388. The following witnesses testified:
Mr. Thomas Murphy, Director, Compensation Service, Veterans
Benefits Administration, U.S. Department of Veterans Affairs;
accompanying Mr. Murphy were The Honorable Roger Baker,
Assistant Secretary for Information and Technology, and Chief
Information Officer, U.S. Department of Veterans Affairs, and
John H. ``Jack'' Thompson, Deputy Assistant General Counsel,
Office of General Counsel, U.S. Department of Veterans; The
Honorable Elizabeth A. McGrath, Deputy Chief Management
Officer, U.S. Department of Defense; Debra Filippi, Former
Director, U.S. Department of Defense/U.S. Department of
Veterans Affairs Interagency Program Office; Jeffrey C. Hall,
Assistant National Legislative Director, Disabled American
Veterans; and Ryan M. Gallucci, Deputy Director, National
Legislative Service, Veterans of Foreign Wars of the United
States. The Veterans' Employment and Training Service, U.S.
Department of Labor submitted a statement for the record.

Subcommittee Consideration

On July 22, 2011, the Subcommittee on Disability Assistance
and Memorial Affairs met in an open markup session and took the
following actions:
The Subcommittee ordered favorably reported H.R. 1826, as
amended, to the full Committee, by voice vote. During
consideration of the bill the following amendment was
considered:
An amendment in the nature of a substitute by Mr. Runyan of
New Jersey was agreed to by voice vote.
The Subcommittee ordered favorably forwarded H.R. 1898 to
the full Committee, by voice vote.
An amendment in the nature of a substitute was offered by
Mr. Runyan of New Jersey to H.R. 2349. The bill was
subsequently withdrawn by unaniomous consent.
The Subcommittee ordered favorably forwarded H.R. 923, as
amended, to the full Committee, by voice vote. During
consideration of the bill the following amendments were
considered:
An amendment in the nature of a substitute by Mr. Runyan of
New Jersey was agreed to by voice vote.
An amendment to the amendment in the nature of a substitute
to provide a reimbursement by VA for military funeral honor
services performed by volunteers at veterans' funerals by Mr.
McNerney of California was defeated by a roll call vote of 4 to
4. The vote is as follows: Chairman Runyan, Mr. Lamborn, Ms.
Buerkle, and Mr. Stutzman voted No; Ranking Member McNerney,
Mr. Barrow, Mr. Michaud, and Mr. Walz voted Yes.
On July 28, 2011, the Subcommittee on Oversight and
Investigations met in an open markup session, a quorum being
present, and ordered favorably forwarded H.R. 2383 to the full
Committee, by voice vote.

Committee Consideration

On September 8, 2011, the full Committee met in an open
markup session, a quorum being present, and ordered reported
favorably H.R. 2349, as amended, to the House of
Representatives, by voice vote. During consideration of the
bill, the following amendment was considered:
An amendment in the nature of a substitute by Mr. Runyan of
New Jersey was agreed to by voice vote, incorporating
provisions from H.R. 2349, H.R. 923, H.R. 2383, H.R. 1898, and
a freestanding provision. The amendment was agreed to by voice
vote.

Committee Votes

Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the record votes
on the motion to report the legislation and amendments thereto.
There were no record votes taken on amendments or in connection
with ordering H.R. 2349, as amended, reported to the House. A
motion by Mr. Bilirakis of Florida to order reported favorably
H.R. 2349, as amended, to the House of Representatives was
agreed to by voice vote.

Committee Oversight Findings

In compliance with clause 3(c)(1) of rule XIII and clause
(2)(b)(1) of rule X of the Rules of the House of
Representatives, the Committee's oversight findings and
recommendations are reflected in the descriptive portions of
this report.

Statement of General Performance Goals and Objectives

In accordance with clause 3(c)(4) of rule XIII of the Rules
of the House of Representatives, the Committee's performance
goals and objectives are reflected in the descriptive portions
of this report.

New Budget Authority, Entitlement Authority, and Tax Expenditures

In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee adopts as its
own the estimate of new budget authority, entitlement
authority, or tax expenditures or revenues contained in the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to section 402 of the Congressional
Budget Act of 1974.

Earmarks and Tax and Tariff Benefits

H.R. 2349, as amended, does not contain any Congressional
earmarks, limited tax benefits, or limited tariff benefits as
defined in clause 9 of rule XXI of the Rules of the House of
Representatives.

Committee Cost Estimate

The Committee adopts as its own the cost estimate on H.R.
2349, as amended, prepared by the Director of the Congressional
Budget Office pursuant to section 402 of the Congressional
Budget Act of 1974.

Congressional Budget Office Cost Estimate

Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
for H.R. 2349, as amended, provided by the Congressional Budget
Office pursuant to section 402 of the Congressional Budget Act
of 1974.

U.S. Congress,
Congressional Budget Office,
Washington, DC, September 30, 2011.
Hon. Jeff Miller,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2349, the
Veterans' Benefits Act of 2011.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Dwayne M.
Wright.
Sincerely,
Douglas W. Elmendorf.
Enclosure.

H.R. 2349--Veterans' Benefits Act of 2011

Summary: H.R. 2349 would modify the eligibility
requirements for veterans' pension awards. The bill also would
require the Department of Veterans Affairs (VA) to undertake a
pilot program to assess the skill level of claims processing
personnel, and would make several other administrative changes
to veterans' benefits programs.
On net, CBO estimates that enacting H.R. 2349 would
decrease direct spending by $11 million over the 2012-2016
period and by $16 million over the 2012-2021 period. In
addition, CBO estimates that implementing H.R. 2349 would
reduce net discretionary costs by $1 million over the 2012-2016
period, assuming appropriation actions consistent with the
bill. Enacting the bill would have an insignificant effect on
revenues. Pay-as-you-go procedures apply because enacting the
legislation would affect direct spending and revenues.
H.R. 2349 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
Estimated cost to the Federal Government: The estimated
budgetary impact of H.R. 2349 is shown in Table 1. The costs of
this legislation fall within budget function 700 (veterans
benefits and services).
Basis of estimate: This estimate is based on information
from the VA. For the purposes of this estimate, CBO assumes the
bill will be enacted near the beginning of fiscal year 2012,
that the necessary amounts will be appropriated each year, and
that outlays will follow historical patterns for similar and
existing programs.

TABLE 1.--ESTIMATED BUDGETARY EFFECTS OF H.R. 2349, THE VETERANS' BENEFITS ACT OF 2011
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------
2012 2013 2014 2015 2016 2012-2016
----------------------------------------------------------------------------------------------------------------
CHANGES IN DIRECT SPENDING\a\

Estimated Budget Authority.............................. * -4 -3 -2 -2 -11
Estimated Outlays....................................... * -4 -3 -2 -2 -11

CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Estimated Budget Authority.............................. 2 * * -1 -1 -1
Estimated Outlays....................................... 2 * * -1 -1 -1
----------------------------------------------------------------------------------------------------------------
\a\In addition to the direct spending effects shown here, enacting H.R. 2349 would have additional effects on
direct spending beyond 2016 (see Table 2). CBO estimates that net direct spending would decrease by $16
million over the 2012-2021 period.
Note: Components may not sum to totals because of rounding; * = less than $500,000.

Direct spending

H.R. 2349 would extend the authority for VA to conduct an
income verification match with the Internal Revenue Service
(IRS); VA also would be required to exclude certain
reimbursements from income when determining a disability
pension award. On net, those provisions would decrease direct
spending by $16 million over the 2012-2021 period, CBO
estimates.
Extension of Income Verification Match. Section 3 would
extend authorities under current law that allow VA to access
information on income reported to the IRS for the purpose of
verifying the income reported by recipients of veterans pension
benefits. Authority for the IRS to provide such information to
VA was extended indefinitely in Public Law 110-245, and
authority for VA to acquire that information is scheduled to
expire on September 30, 2011. Section 3 would extend VA's
authority through September 30, 2013.
According to VA, the department saved approximately $4
million in newly identified overpayments of pension awards by
verifying veterans' incomes in 2010 and an average of $4
million annually over the 2006-2010 period. Using that
information and accounting for mortality, CBO estimates that
enacting section 3 would result in direct spending savings of
$31 million over the 2012-2016 period and $56 million over the
2012-2021 period.

TABLE 2.--ESTIMATED CHANGES IN DIRECT SPENDING UNDER H.R. 2349
--------------------------------------------------------------------------------------------------------------------------------------------------------
Outlays, in millions of dollars, by fiscal year--
-----------------------------------------------------------------------------------------------------
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012-2016 2012-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
Extension of Income Verification Match............ -4 -8 -7 -6 -6 -6 -5 -5 -5 -4 -31 -56
Exclusion of Certain Reimbursements for Pension 4 4 4 4 4 4 4 4 4 4 20 40
Purposes.........................................
-----------------------------------------------------------------------------------------------------
Total Changes................................. * -4 -3 -2 -2 -2 -1 -1 -1 * -11 -16
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: * = between -$500,000 and $500,000.

Exclusion of Certain Reimbursements for Pension Purposes.
Section 3 also would exclude certain reimbursements and
insurance settlements made to a veteran, surviving spouse, or
child from being counted as income in determining disability
pension awards. Under current law, certain payments can be
counted as income and reduce a veteran's or surviving spouse's
pension award. Thus, the effect of section 3 would be to
increase the size of pension awards.
According to VA, under current practice, payments for
casualty losses are already excluded from income
determinations. Awards for pain and suffering are included as
income and make up the majority of reductions in pension
awards. VA does not keep track of the number of pensioners who
have had their pensions reduced because they received an award
for pain and suffering; therefore, CBO used general population
statistics on accidents that result in settlements for pain and
suffering.
Based on national data about the frequency of car accidents
in the United States, about 6.3 million people (or 2 percent of
the population) are involved in car accidents every year. About
30 percent of those accidents result in an injury that could
lead to a pain and suffering settlement. Insurance companies do
not generally publish information on how many injury claims
result in pain and suffering awards. Absent such information,
CBO assumes that about one-half of the individuals injured
receive a payment for pain and suffering.
Based on information from VA on the population of veterans
and spouses who receive pensions and using general population
figures on accidents that result in injuries, CBO estimates
that in 2012, about 7,500 veterans and surviving spouses will
be involved in car accidents and that about 2,240 of them will
be injured. Of those, we expect about half (1,120) will receive
pain and suffering settlements. After accounting for a
declining population of pension recipients, CBO estimates that
by 2021 the number of veterans and surviving spouses receiving
pain and suffering payments will decline to about 1,060 in
2021. After reviewing data on pain and suffering payments, CBO
determined that the average award was about $4,000. Thus, CBO
estimates that enacting section 2 would increase direct
spending by $4 million a year, or $40 million over the 2012-
2021 period.
Reinstatement of Penalties. Section 7 would reinstate
penalties for any individual found to be soliciting a fee or
compensation for the assistance to a veteran in filing an
application for benefits. The provision would expand the number
of individuals who could be federally prosecuted. Because those
prosecuted and convicted under section 7 could be subject to
criminal fines, the federal government might collect additional
fines if the legislation is enacted. Criminal fines are
recorded as revenues, deposited in the Crime Victims Fund, and
later spent. CBO expects that any additional revenues and
direct spending would not be significant because of the small
number of cases likely affected.

Spending subject to appropriation

H.R. 2349 would limit the amount VA could pay for
performance awards, establish a pilot program to assess the
skills of claims processors and provide necessary training
where those skills are deficient, and make other administrative
reforms. CBO estimates that, on net, implementing H.R. 2349
would reduce discretionary costs by $1 million over the 2012-
2016 period, assuming appropriation actions consistent with the
bill.
Performance Awards for Senior Executive Staff. Section 8
would limit the amount that VA could pay in performance awards
to senior staff to $2 million per year over the 2012-2016
period. In 2010, VA paid about $3.3 million in performance
award payments. Assuming a similar amount over the applicable
period, CBO estimates that implementing section 8 would reduce
discretionary spending for pay and performance by about $7
million over the 2012-2016 period.
Assessment of Claims-Processing Skills Pilot Program.
Section 2 would establish a four-year pilot program at five VA
regional offices to test the skills and proficiency of claims
processors (both managers and employees) and to provide
remediation and training to those individuals who do not pass
the tests. Employees who failed the skills assessment after two
attempts would be subject to unspecified personnel action. The
bill also would require an annual report on the pilot program.
Section 2 would authorize the appropriation of $5 million over
the 2012-2016 period for those purposes. CBO estimates that
implementing section 2 would cost $5 million over that period,
assuming appropriation of the specified amount.

TABLE 3.--ESTIMATED CHANGES IN DISCRETIONARY SPENDING UNDER H.R. 2349
----------------------------------------------------------------------------------------------------------------
In millions of dollars, by fiscal year--
-------------------------------------------------------
2012 2013 2014 2015 2016 2012-2016
----------------------------------------------------------------------------------------------------------------
Performance Awards for Senior Executive Staff:
Estimated Authorization Level....................... -1 -1 -1 -1 -1 -7
Estimated Outlays................................... -1 -1 -1 -1 -1 -7
Assessment of Claims-Processing Skills Pilot Program:
Authorization Level................................. 3 1 1 * * 5
Estimated Outlays................................... 3 1 1 * * 5
Other Provisions:
Estimated Authorization Level....................... * * * * * 1
Estimated Outlays................................... * * * * * 1
Total Changes:
Estimated Authorization Level................... 2 * * -1 -1 -1
Estimated Outlays............................... 2 * * -1 -1 -1
----------------------------------------------------------------------------------------------------------------
Note: Components may not sum to totals because of rounding; * = less than $500,000.

Other Provisions. The following provisions would each have
an insignificant impact on spending subject to appropriation,
but together would cost $1 million over the 2012-2016 period,
assuming availability of appropriated funds.
Section 4 would allow VA to use electronic
communications when possible to inform a veteran with a pending
claim that more information is needed to substantiate a claim
for benefits.
Section 5 would require VA to make no less than
two attempts to obtain private medical records for use in
completing a pending claim for benefits.
Pay-As-You-Go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget-reporting and enforcement
procedures for legislation affecting direct spending or
revenues. The net changes in outlays that are subject to those
pay-as-you-go procedures are shown in the following table.
Changes in revenues under the bill would be insignificant.

CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 2349, AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON VETERANS' AFFAIRS ON SEPTEMBER 8, 2011
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-----------------------------------------------------------------------------------------------------
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012-2016 2012-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE OR DECREASE (-) IN THE DEFICIT

Statutory Pay-As-You-Go Impact.................... 0 -4 -3 -2 -2 -2 -1 -1 -1 0 -11 -16
--------------------------------------------------------------------------------------------------------------------------------------------------------

Intergovernmental and private-sector impact: H.R. 2349
contains no intergovernmental or private-sector mandates as
defined in UMRA and would impose no costs on state, local, or
tribal governments.
Estimate prepared by: Federal costs: Dwayne M. Wright;
Impact on state, local, and tribal governments: Lisa Ramirez-
Branum; Impact on the private sector: Elizabeth Bass.
Estimate approved by: Theresa Gullo, Deputy Assistant
Director for Budget Analysis.

Federal Mandates Statement

The Committee adopts as its own the estimate of Federal
mandates regarding H.R. 2349, as amended, prepared by the
Director of the Congressional Budget Office pursuant to section
423 of the Unfunded Mandates Reform Act.

Advisory Committee Statement

No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act would be created by H.R.
2349, as amended.

Statement of Constitutional Authority

Pursuant to Article I, section 8 of the United States
Constitution, the reported bill is authorized by Congress'
power to ``provide for the common Defense and general Welfare
of the United States.''

Applicability to Legislative Branch

The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.

Section-by-Section Analysis of the Legislation

Section 1. Short title

This section would provide the short title of H.R. 2349, as
amended, as the ``Veterans' Benefits Act of 2011.''

Section 2. Assessment of Claims-Processing Skills Pilot Program

This section would directs the VA to carry out a pilot
program to assess skills and provide training described under
subsection (b) no later than 180 days after the enactment of
the act.
(1) Directs the Secretary to assess the skills of
appropriate employees and managers of the Veterans
Benefits Administration biennially who are responsible
for processing claims for compensation and pension
benefits under the laws administered by the Secretary.
This includes requiring such employees and managers to
take the examination provided under section 7732A(a)(1)
of title 38, United States Code. The Secretary must
then develop and implement an individualized training
plan related to such skills for each such employee and
manager on the basis of the results of the
aforementioned assessment and examination, as well as
with any relevant regional office quality review.
(2) This subsection directs the Secretary to provide
such employee or manager with remediation of any
deficiency and to retake the exam if any employee or
manager receives a less than satisfactory result on any
portion of an assessment under paragraph (1)(A).
(b) Directs the Secretary to take appropriate personnel
actions with respect to any employee or manager under certain
circumstances.
(c) Directs the Secretary to carry out the pilot program
under this section at five regional offices of the Veterans
Benefits Administration during the five-year period beginning
on the date of the commencement of the pilot program.
(d) Authorizes appropriations of $5,000,000 to carry out
this section for fiscal years 2012 through 2016.
(e) Directs the Secretary to submit a report, which
includes a summary of results, the remediation, and personnel
actions to the Committee on Veterans' Affairs of the House of
Representatives and the Committee on Veterans' Affairs of the
Senate.
(1) Defines the contents within the subsection (e)
report.
(2) Requires any changes made to the training program
under subsection (b)(1)(B) based on the results of such
assessments and remediation and the examinations
provided under section 7732A(a)(1) of title 38, United
States Code, to be included in the report.

Section 3. Exclusion of certain reimbursements of expenses from
determination of annual income with respect to pensions for
veterans and surviving spouses and children of veterans

This section would amend paragraph (5) of section 1503(a)
of title 38, United States Code, to exempt reimbursements of
any kind, including insurance settlement payments, expenses
related to the repayment, replacement, or repair of equipment,
vehicles, items, money, or property resulting from any
accidents, any theft or loss, and any casualty loss, included
medical expenses resulting from any accident, theft, loss, or
casualty loss.
(I) Defines limitations to accident exemption.
(II) Defines limitations to theft or loss exemption.
(III) Defines limitations to casualty loss exemption.
(B) Defines definition and limitation to pain and suffering
exception related to an accident, theft, loss, or casualty
loss.
(b) Defines the date this subsection takes effect.
(c) Amends section 5317(g) of title 38, United States Code,
by striking ``2011'' and inserting ``2013''.

Section 4. Authorization of use of electronic communication to provide
notice to claimants for benefits under laws administered by the
Secretary of Veterans Affairs

(a) Amends section 5103 of title 38, United States Code, by
authorizing the use of election communication to provide notice
to claimants for benefits under laws administered by the
Secretary.
(4) Amends section 5103 of title 38, United States
Code, by adding a new paragraph, which clarifies that
nothing in this section would compel the Secretary to
provide notice for a subsequent claim that is filed
while a previous claim is pending if the notice
previously provided for such pending claim provided
that:
(A) sufficient notice of the information and evidence
necessary to substantiate such subsequent claim; and
(B) was sent within one year of the date on which the
subsequent claim was filed.
(5)(A) Defines this section as having no
applicability to any claim or issue where the Secretary
may award the maximum benefit in accordance with this
title based on the evidence of record.
(B) Defines the term ``maximum benefit' for purposes
of this paragraph.
(b) Defines proper interpretation of subsection (a).

Section 5. Duty to assist claimants in obtaining private records

(a) Amends Section 5103A(b) of title 38, United States
Code, is amended to direct the Secretary to make reasonable
efforts to obtain relevant private records as part of the
assistance provided under subsection:
(2)(A) Requires the Secretary to notify the claimant
that the Secretary is unable to obtain records with
respect to the claim when reasonable efforts have been
made without obtaining all of the relevant records
sought. This subsection also defines what must be
contained within the notice under this section.
(B) Requires the Secretary to make no less than two
requests to a custodian of a private record in order
for an effort to obtain relevant private records to be
treated as reasonable under this section, unless it is
made evident by the first request that a second request
would be futile in obtaining such records.
(3)(A) Defines this section as inapplicable if the
evidence of record allows for the Secretary to award
the maximum benefit in accordance with this title based
on the evidence of record.
(B) Defines ``maximum benefit'' for purposes of this
paragraph.
(4) Requires the Secretary to encourage claimants to
submit relevant private medical records of the claimant
to the Secretary if such submission does not burden the
claimant; and may require the claimant to authorize the
Secretary to obtain such records.
(b) Amends section 5103A(c) giving instructions to obtain
records for compensation claims.
(1) Directs the Secretary, with respect to assistance
required of the Secretary under this section, to obtain
certain records if relevant to the claim. They include
records defined in (A), (B), and (C) of this
subsection.
(2) Directs the Secretary to continue effects to
obtain records described under this subsection until
the records are obtained unless it is reasonably
certain that such records do not exist or that further
efforts to obtain those records would be futile.

Section 6. Conditions for treatment of certain persons as adjudicated
mentally incompetent for certain purposes

(a) Amends chapter 55 of title 38, United States Code, by
requiring that a person mentally incompetent, incapacitated, or
experiencing an extended loss of consciousness to not be
considered adjudicated as a mental defective under subsection
(d)(4) or (g)(4) of section 922 of title 18 without the order
or finding of a judge, magistrate, or other judicial authority
of competent jurisdiction that such person is a danger to
himself or herself or others.
(b) Amends the table of sections in chapter 55.

Section 7. Reinstatement of penalties for charging veterans
unauthorized fees

(a) Amends section 5905 of title 38, United States Code, to
reinstate penalties for a knowing solicitation, contracting,
charging, or receiving any fee or compensation in connection
for various services defined in subsections (A) or (B).
Subsections (2), (3), and (4) expound on the penalties
described in this section.
(b) Defines the date this subsection takes effect.

Section 8. Performance awards in the Senior Executive Service

Prohibits the Secretary from paying more than $2,000,000 in
performance awards under section 5384 of title 5, United States
Code, for each of fiscal years 2012 through 2016.

Section 9. Budgetary effects of this act

Defines the budgetary effects of this Act for the purpose
of complying with the Statutory Pay-As-You-Go-Act of 2010, and
Amends title 38, United States Code.

Changes in Existing Law Made by the Bill, as Reported

In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):

TITLE 38, UNITED STATES CODE

* * * * * * *

PART II--GENERAL BENEFITS

* * * * * * *

CHAPTER 15--PENSION FOR NON-SERVICE-CONNECTED DISABILITY OR DEATH OR
FOR SERVICE

* * * * * * *

SUBCHAPTER I--GENERAL

* * * * * * *

Sec. 1503. Determinations with respect to annual income

(a) In determining annual income under this chapter, all
payments of any kind or from any source (including salary,
retirement or annuity payments, or similar income, which has
been waived, irrespective of whether the waiver was made
pursuant to statute, contract, or otherwise) shall be included
except--
(1) * * *

* * * * * * *

[(5) reimbursements of any kind for any casualty loss
(as defined in regulations which the Secretary shall
prescribe), but the amount excluded under this clause
may not exceed the greater of the fair market value or
reasonable replacement value of the property involved
at the time immediately preceding the loss;]
(5) payments regarding--
(A) reimbursements of any kind (including
insurance settlement payments) for--
(i) expenses related to the
repayment, replacement, or repair of
equipment, vehicles, items, money, or
property resulting from--
(I) any accident (as defined
in regulations which the
Secretary shall prescribe), but
the amount excluded under this
subclause shall not exceed the
greater of the fair market
value or reasonable replacement
value of the equipment or
vehicle involved at the time
immediately preceding the
accident;
(II) any theft or loss (as
defined in regulations which
the Secretary shall prescribe),
but the amount excluded under
this subclause shall not exceed
the greater of the fair market
value or reasonable replacement
value of the item or the amount
of the money (including legal
tender of the United States or
of a foreign country) involved
at the time immediately
preceding the theft or loss; or
(III) any casualty loss (as
defined in regulations which
the Secretary shall prescribe),
but the amount excluded under
this subclause shall not exceed
the greater of the fair market
value or reasonable replacement
value of the property involved
at the time immediately
preceding the casualty loss;
and
(ii) medical expenses resulting from
any accident, theft, loss, or casualty
loss (as defined in regulations which
the Secretary shall prescribe), but the
amount excluded under this clause shall
not exceed the costs of medical care
provided to the victim of the accident,
theft, loss, or casualty loss; and
(B) pain and suffering (including insurance
settlement payments and general damages awarded
by a court) related to an accident, theft,
loss, or casualty loss, but the amount excluded
under this subparagraph shall not exceed an
amount determined by the Secretary on a case-
by-case basis;

* * * * * * *

PART IV--GENERAL ADMINISTRATIVE PROVISIONS

* * * * * * *

CHAPTER 51--CLAIMS, EFFECTIVE DATES, AND PAYMENTS

* * * * * * *

SUBCHAPTER I--CLAIMS

* * * * * * *

Sec. 5103. Notice to claimants of required information and evidence

(a) Required Information and Evidence.--(1) [Upon receipt of
a complete or substantially complete application, the] The
Secretary shall [notify] provide to the claimant and the
claimant's representative, if any, by the most effective means
available, including electronic communication or notification
in writing of any information, and any medical or lay evidence,
not previously provided to the Secretary that is necessary to
substantiate the claim. As part of that notice, the Secretary
shall indicate which portion of that information and evidence,
if any, is to be provided by the claimant and which portion, if
any, the Secretary, in accordance with section 5103A of this
title and any other applicable provisions of law, will attempt
to obtain on behalf of the claimant.

* * * * * * *

(b) Time Limitation.--(1) * * *

* * * * * * *

(4) Nothing in this section shall require the Secretary to
provide notice for a subsequent claim that is filed while a
previous claim is pending if the notice previously provided for
such pending claim--
(A) provides sufficient notice of the information and
evidence necessary to substantiate such subsequent
claim; and
(B) was sent within one year of the date on which the
subsequent claim was filed.
(5)(A) This section shall not apply to any claim or issue
where the Secretary may award the maximum benefit in accordance
with this title based on the evidence of record.
(B) For purposes of this paragraph, the term ``maximum
benefit'' means the highest evaluation assignable in accordance
with the evidence of record, as long as such evaluation is
supported by such evidence of record at the time the decision
is rendered.

Sec. 5103A. Duty to assist claimants

(a) * * *
[(b) Assistance in Obtaining Records.--(1) As part of the
assistance provided under subsection (a), the Secretary shall
make reasonable efforts to obtain relevant records (including
private records) that the claimant adequately identifies to the
Secretary and authorizes the Secretary to obtain.
[(2) Whenever the Secretary, after making such reasonable
efforts, is unable to obtain all of the relevant records
sought, the Secretary shall notify the claimant that the
Secretary is unable to obtain records with respect to the
claim. Such a notification shall--
[(A) identify the records the Secretary is unable to
obtain;
[(B) briefly explain the efforts that the Secretary
made to obtain those records; and
[(C) describe any further action to be taken by the
Secretary with respect to the claim.
[(3) Whenever the Secretary attempts to obtain records from a
Federal department or agency under this subsection or
subsection (c), the efforts to obtain those records shall
continue until the records are obtained unless it is reasonably
certain that such records do not exist or that further efforts
to obtain those records would be futile.
[(c) Obtaining Records for Compensation Claims.--In the case
of a claim for disability compensation, the assistance provided
by the Secretary under subsection (b) shall include obtaining
the following records if relevant to the claim:
[(1) The claimant's service medical records and, if
the claimant has furnished the Secretary information
sufficient to locate such records, other relevant
records pertaining to the claimant's active military,
naval, or air service that are held or maintained by a
governmental entity.
[(2) Records of relevant medical treatment or
examination of the claimant at Department health-care
facilities or at the expense of the Department, if the
claimant furnishes information sufficient to locate
those records.
[(3) Any other relevant records held by any Federal
department or agency that the claimant adequately
identifies and authorizes the Secretary to obtain.]
(b) Assistance in Obtaining Private Records.--(1) As part of
the assistance provided under subsection (a), the Secretary
shall make reasonable efforts to obtain relevant private
records.
(2)(A) Whenever the Secretary, after making such reasonable
efforts, is unable to obtain all of the relevant records
sought, the Secretary shall notify the claimant that the
Secretary is unable to obtain records with respect to the
claim. Such a notification shall--
(i) identify the records the Secretary is unable to
obtain;
(ii) briefly explain the efforts that the Secretary
made to obtain such records; and
(iii) explain that the Secretary will decide the
claim based on the evidence of record but that this
section does not prohibit the submission of records at
a later date if such submission is otherwise allowed.
(B) The Secretary shall make not less than two requests to a
custodian of a private record in order for an effort to obtain
relevant private records to be treated as reasonable under this
section, unless it is made evident by the first request that a
second request would be futile in obtaining such records.
(3)(A) This section shall not apply if the evidence of record
allows for the Secretary to award the maximum benefit in
accordance with this title based on the evidence of record.
(B) For purposes of this paragraph, the term ``maximum
benefit'' means the highest evaluation assignable in accordance
with the evidence of record, as long as such evaluation is
supported by such evidence of record at the time the decision
is rendered.
(4) Under regulations prescribed by the Secretary, the
Secretary--
(A) shall encourage claimants to submit relevant
private medical records of the claimant to the
Secretary if such submission does not burden the
claimant; and
(B) in obtaining relevant private records under
paragraph (1), may require the claimant to authorize
the Secretary to obtain such records if such
authorization is required to comply with Federal,
State, or local law.
(c) Obtaining Records for Compensation Claims.--(1) In the
case of a claim for disability compensation, the assistance
provided by the Secretary under this section shall include
obtaining the following records if relevant to the claim:
(A) The claimant's service medical records and, if
the claimant has furnished the Secretary information
sufficient to locate such records, other relevant
records pertaining to the claimant's active military,
naval, or air service that are held or maintained by a
governmental entity.
(B) Records of relevant medical treatment or
examination of the claimant at Department health-care
facilities or at the expense of the Department, if the
claimant furnishes information sufficient to locate
those records.
(C) Any other relevant records held by any Federal
department or agency that the claimant adequately
identifies and authorizes the Secretary to obtain.
(2) Whenever the Secretary attempts to obtain records from a
Federal department or agency under this subsection, the efforts
to obtain those records shall continue until the records are
obtained unless it is reasonably certain that such records do
not exist or that further efforts to obtain those records would
be futile.

* * * * * * *

CHAPTER 53--SPECIAL PROVISIONS RELATING TO BENEFITS

* * * * * * *

Sec. 5317. Use of income information from other agencies: notice and
verification

(a) * * *

* * * * * * *

(g) The authority of the Secretary to obtain information from
the Secretary of the Treasury or the Commissioner of Social
Security under section 6103(l)(7)(D)(viii) of the Internal
Revenue Code of 1986 expires on September 30, [2011] 2013.

* * * * * * *

CHAPTER 55--MINORS, INCOMPETENTS, AND OTHER WARDS

Sec.
5501. Commitment actions.
* * * * * * *
5511. Conditions for treatment of certain persons as adjudicated
mentally incompetent for certain purposes.

* * * * * * *

Sec. 5511. Conditions for treatment of certain persons as adjudicated
mentally incompetent for certain purposes

In any case arising out of the administration by the
Secretary of laws and benefits under this title, a person who
is mentally incapacitated, deemed mentally incompetent, or
experiencing an extended loss of consciousness shall not be
considered adjudicated as a mental defective under subsection
(d)(4) or (g)(4) of section 922 of title 18 without the order
or finding of a judge, magistrate, or other judicial authority
of competent jurisdiction that such person is a danger to
himself or herself or others.

* * * * * * *

CHAPTER 59--AGENTS AND ATTORNEYS

* * * * * * *

[Sec. 5905. Penalty for certain acts

[Whoever wrongfully withholds from any claimant or
beneficiary any part of a benefit or claim allowed and due to
the claimant or beneficiary, shall be fined as provided in
title 18, or imprisoned not more than one year, or both.]

Sec. 5905. Penalty for certain acts

Except as provided in section 5904 or 1984 of this title,
whoever--
(1) in connection with a proceeding before the
Department, knowingly solicits, contracts for, charges,
or receives any fee or compensation in connection for--
(A) the provision of advice on how to file a
claim for benefits under the laws administered
by the Secretary; or
(B) the preparation, presentation, or
prosecution of such a claim before the date on
which a notice of disagreement is filed in a
proceeding on the claim,
or attempts to do so;
(2) unlawfully withholds from any claimant or
beneficiary any part of a benefit or claim under the
laws administered by the Secretary that is allowed and
due to the claimant or beneficiary, or attempts to do
so;
(3) commits an offense punishable by this chapter, or
aids, abets, counsels, commands, or procures the
commission of such an act; or
(4) causes an act to be done, which if directly
performed would be punishable by this chapter,
shall be fined as provided in title 18, or imprisoned for not
more than one year, or both.

* * * * * * *