what the problem is, when VA starts getting these large backlogs, they start pressing their adjudicators to put out larger numbers of cases. And when they do that, they start making more mistakes. And then their cases have to be reworked, and that in the long term just creates a vicious cycle.

Senator THUNE. Slows it down, right. OK. Anything to add, Mr. Chisholm?

Mr. CHISHOLM. I think training is critical. The other thing that I think is working at the regional office level is the decision-review officers. These are the folks that have the second-you can have sort of an internal appeal, if you will, at the regional office. And the decision-review officer has the power to do de novo review. And I am seeing a lot of success at that level.

And I think the VA should increase the number of DROs in the regional offices. And I think you will see more cases cleared as a result of that, and not being appealed.

Senator THUNE. All right. Judge Kramer, in some of your series of recommendations you talk about ALJs and consolidating at the appellate level adjudication. Just curious, would there be an argument to be made for allowing folks to go directly to the circuit court of appeals wherever they are, as opposed to going through the current process?

Mr. KRAMER. Well, one of the points that I put in my written testimony, that I didn't include in my 5-minute version for lack of time, was that I do believe in a single level of appellate review. I know that obviously people who lose, as you can tell from some of the other testimony here and I understand that-if you lose at our level, you would like another opportunity to win at an additional level. But you also have to balance that against cost, time, and efficiency.

The other alternative suggestion I made, which I think is more draconian than to eliminate Federal Circuit review, is to simply merge the veterans court into the Federal Circuit; increase the expertise of the Federal Circuit in veterans' law. I don't favor that as a method of one level of appellate review over the method that I most recommended because, one, I believe that most people feel that review focused exclusively on veterans' cases is a good thing; and No. 2, the primary focus of the Federal Circuit, even if you merged the veterans' court into the Federal Circuit, would still be intellectual property law, which is the basis for which they were created in the first place.

But if you had to choose, I think, between two levels of judicial review, or one level conducted only by the Federal Circuit with a merged Federal Circuit court, I think that would be preferable. In fact, if you look at the Federal Circuit history, its own growth is one of merger and spin-off, merger and spin-off, among Article I and Article III courts.

Senator THUNE. Thank you, Mr. Chairman. I see my time has expired.

Chairman CRAIG. Senator Obama, welcome back.

Senator OBAMA. Thank you very much, Mr. Chairman. Thank you to the panel. I am sorry I missed your live testimony, but I had an opportunity to read the written testimony.

My first question, I guess, is for Mr. Surratt. We had the Secretary out to Illinois at a town hall meeting in response to some of the discrepancies that we were seeing in terms of benefits across the country. And I had an opportunity to review the IG report on this problem.

One of the things that was striking was the huge gap between veterans' benefits for those who had VSOS representing them, and those who did not. And I am wondering what you think we can do to make sure that all veterans are aware of the need for an advocate in these circumstances.

And I am wondering whether that is something that the VSOS have done to actively encourage their use. Why it is that there might be big differences in some States versus others in terms of the utilization of VSOS.

Mr. SURRATT. What I would speculate-and that is purely what it is is that those people who are not represented by VSOs or attorneys do so because they choose not to be represented. We certainly put out, all organizations put out, literature. I think the VA notifies veterans of their right to free representation from VSOS. And as the figures demonstrate, there is a better chance of getting higher benefit levels if you are represented. And the VSOs look behind the VA decision, and the VA is pressured to make fast decisions. And in the appellate process, they catch errors.

Senator OBAMA. I guess what I am wondering is, do we let veterans know that, you know, if you just look at the studies, that there may be $6,000 more in benefits if you use a VSO or an attorney than if you don't? I mean, because my suspicion is that you might have a veteran going in there feeling like, "Well, this is something I can handle myself," but if somebody told him, "You know, on average-may not happen here, but on average you are going to get $6,000 more if you are using an attorney or a VSO advocate," that that might make some difference in terms of what they decide to do.

Mr. SURRATT. Well, we have never put it in terms of money. We didn't have the data.

Senator OBAMA. Right.

Mr. SURRATT. But we have put it in terms of, "You have a better chance of getting your case allowed and getting the proper decision, if you are represented." I, personally, wouldn't want to use money as a selling point. We have the data before us, and I am sure that that will be widely disseminated.

But, yes, we should encourage veterans to seek VSO representation in any way we can, and I think we do that. And again, I would just guess that the majority of those who are not represented are not represented because of lack of knowledge, but because of choice.

Senator OBAMA. OK. Judge Kramer, I just had a quick question for you. I was intrigued by your suggestion that VA physicians fill out a standard form addressing causation when treating new conditions. How much, in your opinion, is the delay that exists caused by a lack of medical verification?

Mr. KRAMER. Well, there is a long-term provision in the lawcertainly predates me; and not much does that-for the VA to do what other governmental entities don't do, and that is help a claim

ant gather evidence for their claim. And in my experience, the evidence most often missing is evidence of causation.

And right now, the rules are very murky and ambiguous, despite the passage of the Federal Claims Assistance Act, as to exactly when such a medical opinion must be rendered. And it has been the cause over my career of much litigation, many remands, and elongating the claims history of claims significantly. And so I think an early resolution of when that kind of a medical opinion has to be offered, clarification by the Committee as to that law, would be extraordinarily helpful.

Now, as you can tell-and as some of the commentators, and correctly so, suggested—at least there is some front-end cost to some of the things that I have suggested. You have 800,000 new claims. You know, not all of them will involve medical causation, of course. But you would have to put some parameters on when such an opinion was going to be rendered, because you can't, obviously, issue 800,000 opinions from the get-go.

But I do believe that the fight over when you should get an opinion-and we found many cases at the court, for example, that the key questions had never been addressed.

Right now, under the law, VA has, in essence, huge discretion as to when to obtain such an opinion. Under the old law, you had to have, in essence, what they call a rounded claim in order to get VA assistance. As the court interpreted it, you had to have possible evidence of a present disability, possible evidence of an event in service, possible medical evidence in most cases of a relationship between the two.

There was a lot of complaint about that; a lot of cause for dismay. The Veterans' Claims Assistance Act, I think its primary objective was to fix that problem. And yet, the very provision in the Veterans' Claims Assistance Act that deals with the obtaining of medical opinions, in essence, requires evidence of a medical connection before the VA is required to go get an opinion. So we are right back where we started from.

So I would suggest that a lot could be gained on changing this specific provision, clarifying the rules as to when such a medical opinion has to be rendered.

Senator OBAMA. Thank you, Mr. Chairman.

Chairman CRAIG. Lady and gentlemen, we are running out of time, and I am disappointed in that. I have several more questions I would like to ask. So I am going to beg your indulgence, to submit them to you in writing to gain your response.

Mr. Chisholm, I am curious about your suggestion to provide legal counsel earlier on, and the ramifications of that; and a variety of other aspects of some of the comments that Mr. Surratt has made. So I will do that. And I understand our Ranking Member has other questions he would like to ask, also. So we will submit some questions to you in writing.

Let me thank you all very much for your time here today and your preparation. It is extremely important to all of us that we might nudge this system a little further into responsiveness. I know that the cry for resources is always there, and that is a difficulty. So we are examining it from two levels; both resources, and structure and function. And I think that those are all important as

pects as to the process that will best render our veterans as immediate adjudication of their claims as is possible.

And the backlogs are at times, by number, overwhelming to try to understand why we can't get a handle on them; but we have seen the Veterans' Administration push forward very aggressively. We hope that will continue. We will continue to nudge them and observe and, if need be, appeal to the Congress to make some statutory changes.

Judge Kramer, I appreciate your insight into it. Your experience obviously is very valuable to us, and your offer to stay in touch. We will do just that with you, as I know we will with these other gentlemen and with Cynthia, as we work through this issue.

Thank you all very much for your time, and the Committee will stand adjourned.

[Whereupon, at 4:16 p.m., the Committee was adjourned.]

APPENDIX

RESPONSE TO WRITTEN QUESTIONS SUBMITTED BY HON. LARRY E. CRAIG

TO DANIEL L. COOPER

Question 1. Currently, priority access to VA health care is given to combat theater veterans who are within two years of their military discharge date. To be consistent with that policy, and to encourage veterans to file claims within close proximity to their service discharge, should there be priority treatment of claims that are filed within two years after service, especially if that service occurred during a wartime period.

Answer. The Veterans Benefits Administration (VGA) is giving top priority to the benefit claims of all returning war veterans who are seriously injured, and certainly providing the best possible service to these returning heroes must remain our highest priority. VBA also gives priority to claims from terminally ill veterans, homeless veterans, veterans with severe financial hardship, former prisoners of war, and veterans over age 70.

VBA has a number of initiatives to assist service members separating from active duty in filing claims promptly. Under the Benefits Delivery at Discharge (BDD) program-in place at 140 military installations around the country and overseas-active duty service members within 180 days of separation are encouraged to file disability compensation claims with Department of Veterans Affairs (VA) staff who are serving at military bases either on a full-time or itinerant basis. Service members can complete the necessary physical examinations and have their claims evaluated before or closely following their military separation dates. In most cases, disabled service members participating in the BDD program begin receiving VA disability compensation benefits within 60 days of their separation from active duty, which serves to ease the transition from active duty to civilian status. In fiscal year (FY) 2004, the BDD Program received approximately 40,000 claims from separating service members.

Through the joint VA/Department of Defense (DOD)/Department of Labor (DCL) Transition Assistance Program (TAP) and Disabled Transition Assistance Program (DTAP), VBA conducts extensive outreach to ensure separating service members file claims for VA benefits. Service members are fully briefed on the VA benefits available to them and encouraged to apply for the benefits. Since October 2002, VGA military services coordinators have conducted nearly 20,000 briefings, which were attended by almost 700,000 service members and families including members of the Reserve and National Guard. VBA also conducted 1,500 briefings attended by 40,000 service members based overseas.

In view of the fact that VA currently gives priority to claims filed by seriously injured service members who participated in Operation Enduring Freedom (OEF) or Operation Iraqi Freedom (OIF) and the measures already in place to assist service members leaving service in filing claims for VA benefits, VA does not believe it is necessary to provide priority handling of all claims filed within two years after service in order to encourage filing for VA benefits. VA's goal is to provide quality, timely, and compassionate service to all claimants.

Question 2a. At the hearing, Judge Kramer recommended that Congress amend the duty-to-assist provision contained in 38 U.S.C. §5103A(d) to clarify the circumstances under which VA must provide a medical opinion as to whether there is a causal link (or nexus) between a current disability and service. Under what circumstances does VA provide a medical nexus opinion? In general, must there be some medical evidence of a causal relationship between a current disability and service before such an opinion is provided?

Answer. VBA requests a medical nexus opinion when it is deemed necessary to decide a claim, depending on the facts of the individual case. 38 U.S.C. §5103Ă(d). The statute and the implementing regulation 38 CFR §3.159(c)(4) provide guidelines on when a medical examination or medical opinion is necessary to decide a claim.