(Subsequently, the Department of Veterans Affairs provided the following information:)

The VA Persian Gulf Expert Scientific Committee was chartered in late 1993. The purpose of this standing federal advisory committee is to advise the VA Under Secretary for Health and the Chief Public Health and Environmental Hazards Officer on medical findings affecting Persian Gulf veterans and to make recommendations to the Secretary. The Committee consists of 18 members selected on the basis of high professional achievement and expertise in illnesses and research that might be related to Persian Gulf service. Currently, there are 3 representatives from Veterans' Service Organizations who are members of the Committee.

Mr. REYES. Well, more than anything I would offer that as a recommendation or as a suggestion.

Because, you know, in the previous round when I asked youwhen I informed you about the frustration that exists out in the veteran community, you said the motto of the VA is "grant if you can, deny if you must."

Surely there is based again-and by your own admission, the frustration that you have heard prior to this morning, surely there's something wrong systemically that where so many veterans feel such a high and intense sense of frustration and, as my colleague Lane Evans mentioned, now escalated to anger.

Those kinds of issues, at least from my perspective and from the comments that have been made by veterans in my District, are not new. You know, it's something that I guess veterans feel they have had to deal with continuously and for years.

I offer that again in the context of we need to at least strive to better serve these people that have put their life on the line for this country.

Ms. MOFFITT. Let me just mention-in our business process reengineering, as we started out, we went to our stakeholders and interviewed them. We interviewed veterans, service organizations, members of Congress, people in the Department of Veterans Affairs and outside.

In that very issue, the disconnect between what we are trying to do for veterans and how veterans feel about what we actually do do, was a key communication issue, something that has been mentioned by others here today. In the reengineered process, what we expect is that the veteran will be able to talk directly to the decision maker.

So he wouldn't be calling in to a phone bank that couldn't get access to his record. He may be calling in to a phone center where they could directly connect him with the team that is handling his or her claim.

And that's that communication that veterans are looking for, that we are engineering into our process so that there will not be that disconnect between what the decision makers are trying to do for veterans and how veterans feel they're being treated.

We want those to be mutual in that we respect veterans and we want them to feel respected. We are granting wherever we can, and we want them to understand when we can't grant why it wasn't possible.

Mr. REYES. And this type of service which, you know, I certainly applaud you for this-striving for this goal, but this type of service is not limited in any way by the lack of staffing that you have mentioned this morning-or shortage of staffing?

Ms. MOFFITT. The reengineered process, you know, anticipates that there will be reductions in staffing over the next several years. And you know, it's not simply what the-how the human resources will do their job, but it includes information technology initiatives that need to be in place so that our decision makers can get online access, for instance, to Veterans' Health Administration records so the decisions can be made online.

Or a veteran can be saying I was recently treated at a particular private hospital, and us being able to go through an online system and say yes, sir, that hospital record is available to us and we'll be able to make a decision on your claim.

So there's lots of things that go into it besides just the people knowing how to do their job. It includes, like I said, IT initiatives, telephone systems. It's a very detailed plan that needs to all be brought together to provide this service that we hope to provide.

Mr. REYES. So then if I understand your question, is that you do anticipate having sufficient staffing so that a veteran in Des Moines will get the same kind of service as in Tampa and Spokane and San Diego and El Paso and all these different areas?

Ms. MOFFITT. Yes; yes, sir.

Mr. REYES. Okay.

Thank you, Mr. Chairman.

Mr. QUINN. And Buffalo, right? You're going to mention Buffalo? Okay, thanks.

Thank you, Mr. Reyes.

If I may just move for a second. The final question for me has to do with the VA's proposed legislation to limit liability in smoking-related illnesses. That, after all, was part of our agenda and you testified to it earlier in your opening remarks.

Do you have any kind of estimate on the amount of compensation that will be paid over the 5 years if this bill isn't passed?

Ms. MOFFITT. I'm going to refer that to Mr. Gardner.

Mr. QUINN. Could you-I'm just looking for a ball park figure here.

Mr. GARDNER. We don't have that right now.

[The information follows:]

Based on a recent General Counsel decision, it is necessary to revise our estimates. As soon as the revised estimates are available, we will share the information with the subcommittee.

Mr. QUINN. Could you take a look at that and maybe get it over to us in the next couple of days or a week or so? I'd appreciate that. Any further questions for Ms. Moffitt at this time?

Thanks very much for your answers and your preparation for today. We appreciate it very, very much. And I think we've at least, in summary here, tried to point out our willingness to help on the subcommittee and the full committee.

And call on us if you need us. We appreciate it very, very much. Ms. MOFFITT. Thank you, sir.

Mr. QUINN. Thank you.

The second panel-Mr. Filner made me a little nervous when he asked me what I wanted on my cheeseburger. I think he's going to order lunch out here. Be here all day long.

Our second panel consists of Mr. Stephen Backhus, Director of Veterans' Affairs and Military Health Care Issues at the GAO.

He'll also be accompanied at the table this morning. We appreciate you coming over. Good to see you again.

We begin always by saying that any and all remarks that you have in the line of testimony will be accepted and submitted for the record. But as we operate under the 5-minute rule, we ask you to keep your opening remarks, if you could, to about 5 minutes.

Mr. BACKHUS. I think I can do that.

Mr. QUINN. And we appreciate it. And you may begin, sir.

STATEMENT OF STEPHEN BACKHUS, DIRECTOR, VETERANS' AFFAIRS AND MILITARY HEALTH CARE ISSUES, GENERAL ACCOUNTING OFFICE

Mr. BACKHUS. Okay, it's good to see you again too. Thank you. I'd like to introduce, if I could, Cindy-on my left, Cindy Fagnoni, our Associate Director for Veterans' Issues. And on my right, Irene Chu, our Assistant Director.

Mr. Chairman and members of the subcommittee, we are pleased to be here today to provide our views on the progress and the challenges facing the Veterans Benefits Administration in implementing GPRA.

As you know, the Act was passed in 1993 to require agencies to clearly define their missions, set goals, measure performance, and report on their accomplishments. It was designed to focus Federal agencies' attention on the results of the programs they administer, not just the program operations.

Instead of focusing on the amounts of money they spend or the size of their workloads, agencies are expected to rethink their missions in terms of the results they provide, develop goals based on their results-oriented missions, developed strategies for achieving their goals, and measure actual performance against the goals.

Perhaps most significantly though, GPRA also requires agencies to consult with Congress in developing their strategic plans. This gives the Congress an opportunity to work with agencies to ensure that their missions and goals are focused on results, are consistent with congressional intent, and are reasonable in light of fiscal constraints.

GPRA requires VA and other Federal agencies to complete their strategic planning by September 30 of this year, and in the future, submit annual performance plans and reports to OMB and the Congress.

As you know, VBA's responsible for administering the nonmedical programs of VA that provide financial and other benefits to veterans, their dependents, and survivors.

As you requested, Mr. Chairman, my statement will focus primarily on VBA's largest business line, the Compensation and Pension Program, which spends about $19 billion dollars annually or about 90 percent of the VBA appropriation.

The information I have today is based on our past work in the area, our review of the strategic plan, and of course our discussions with VA officials.

In summary, it's our view that VBA has taken an important first step in implementing GPRA, but the process is an evolving one and many challenges lie ahead.

VBA has developed a strategic plan with a mission and goals and has begun consulting with Congress, as we understand, as well as other stakeholders, to obtain their views on its plan.

For the Comp & Pen Program, VA has identified seven goals that are oriented toward the efficiency of claims processing, customer satisfaction, improving the accuracy rate for paid claims, reducing the time required to process claims, and reducing their cost-their operating cost.

It has also identified specific performance measures in these areas such as reducing processing time for the original compensation claims from 144 days to 53 days and achieving a 97-percent accuracy rate for claims by fiscal year 2002.

As the VBA continues its process of implementing GPRA, it faces some difficult challenges, however.

If the full intent of GPRA is to be achieved, VBA will need to develop a clear mission, goals, and measures-performance measures that are truly results-oriented, not just ones that are process-oriented.

For example, the purpose of the disability program, the Disability Compensation Program, is to compensate veterans for the average loss in earning capacity in civilian occupations that results from injuries or conditions incurred or aggravated during military service.

Given this purpose, results-oriented goals would focus on issues such as whether disabled veterans are indeed being compensated for the average loss in earning capacity and whether VBA is providing compensation to all those who should be compensated.

VBA has not yet tackled these types of difficult questions and will need to do so in consultation with Congress in order to develop a truly results-oriented strategic plan. These are very sensitive issues.

VBA has told us that they have begun consulting with Congress and other stakeholders about appropriate goals and measures for the Comp & Pen Program. As VBA continues its strategic planning, it will also need to integrate its plans with those of the rest of VA, as well as those other Federal agencies that support veterans' benefits programs.

For example, in determining the eligibility of a veteran for disability compensation, VBA usually requires the veteran to undergo a medical exam which is generally performed by the Veterans' Health Administration physicians.

Similarly, VBA looks to the Department of Defense for information about the medical conditions of veterans while they're in the military and to the Department of Labor for veterans' employment and training experiences. VBA will need to determine what impact these other entities have on their performance.

In conclusion, Mr. Chairman, VBA is aware that it has much work to do to fully implement GPRA. Its success in implementing the Act will depend on how successful it is in ensuring that its plan focuses on results, integrates with other VA components and other agencies, and that its performance is measured, assessed, and reported.

Congress plays an important role in consulting with VBA in developing a results-oriented goal and overseeing their efforts.

This concludes my testimony and I'll be glad, along with my colleagues, to respond to any questions that you or other members of the subcommittee may have.

[The prepared statement of Mr. Backhus appears on p. 72.]

Mr. QUINN. Thank you very much, Steve. We appreciate both this testimony and the briefing that Bob and I had some weeks ago. I have no questions at this point.

Third panel. Our third panel represents several veterans' service organizations. Today we're pleased to have with us Mr. Jim Magill, Legislative Director of the VFW; Mr. Chuck Burns, Service Director of AMVETS; Mr. Matt Puglisi, Assistant Director of the American Legion's VA and Voc Rehab Commission; Mr. Bill Russo, the Director of Veterans' Benefits Programs for the Vietnam Veterans of America; and Mr. Joseph Violante, Deputy Legislative Director for the DAV.

Gentlemen, thanks for joining us today. I'll note for the record that our letter of invitation to all of you requested that you submit written comments on Comp & Pen's Results Act testimony so that you would have a chance to review it thoroughly as well as the subcommittee.

Before you begin, I also want to congratulate the Legion for providing over $600,000 in grants to Persian Gulf veterans and their families. Well done, and we appreciate your assistance a great deal.

In no particular order, unless you guys have flipped a coin outside, Mr. Violante, how about if we start there and work our way across the table.

STATEMENT OF JOSEPH VIOLANTE, DEPUTY NATIONAL LEGISLATIVE DIRECTOR, DISABLED AMERICAN VETERANS Mr. VIOLANTE. Thank you, Mr. Chairman and members of the subcommittee.

Since 1920, the Disabled American Veterans has been dedicated to one single purpose-building better lives for disabled veterans and their families. On behalf of the more than one million members of the DAV and its auxiliary, I wish to express our deep appreciation for this opportunity to provide our assessment of the processing of Persian Gulf War veterans' claims.

Mr. Chairman, the current system of processing these claims at the four regional offices is not working. It's apparent that the current system serves neither Persian Gulf veterans nor the local veterans very well. And I'm happy to hear that the VA is going to be moving towards decentralization of these claims.

The plight of the Persian Gulf veterans suffering from undiagnosed illnesses continues to be one of our foremost concerns. Recent VA statistics on the claims processing for these veterans only heightens our concerns.

Of the 11,806 environmental hazard claims considered, slightly more than 1,600 have been grated service connection; and only 803 have been granted service connection for undiagnosed illnesses.

The VA has denied almost 10,000 claims for undiagnosed illnesses, and these disallowed claims fall into six categories. And these are that there's a diagnosis; that the illness was not chronic; it was due to other etiology; that it was not manifest on active duty or during the two year presumptive period; it's not shown by the