Read More »"/> Read More »"/> How Washington, D.C., Works, or Not, Part 5 | MyGovCost | Government Cost Calculator

How Washington, D.C., Works, or Not, Part 5

Tuesday August 27th, 2013   •   Posted by Craig Eyermann at 7:20am PDT   •  

chairWe really didn’t set out to make an ongoing series out of these examples, but unfortunately, the politicians and bureaucrats in our nation’s capital keep providing fresh ones!

Today’s example of bureaucrats putting themselves ahead of the interests of regular Americans comes to us from the pages of the Washington Post, which reports that the Department of Veterans Affairs, the largest “civilian” department in the U.S. government, gave its employees bonuses for avoiding additional work that would be required to document claims filed by veterans about the injuries they sustained while serving in the military.

We’re not making that up….

In 2011, a year in which the claims backlog ballooned by 155 percent, more than two-thirds of claims processors shared $5.5 million in bonuses, according to salary data from the Office of Personnel Management.

The more complex claims were often set aside by workers so they could keep their jobs, meet performance standards or, in some cases, collect extra pay, said VA claims processors and union representatives. Those claims now make up much of the VA’s widely scrutinized disability claims backlog, defined by the agency as claims pending more than 125 days.

What appears to have driven much of this apparent fiasco was the implementation of a pay-for-performance scheme by the Department of Veterans Affairs’ management, which greatly favored “productivity” in the form of the number of claims processed each day over other measures such as quality and customer satisfaction. Veterans who need to file complex claims are especially disadvantaged in the scheme, because the bureaucrats handling the claims lacked the incentives to get them right or to make sure all of an injured veteran’s needs were met.

The Washington Post describes some of the outcome of the federal government agency’s twisted pay-incentive scheme for its employees:

… News21 found that regional office management gave bonuses to some employees even as their claims backlogs grew. During 2012, Office of Personnel Management records show some of the most troubled offices gave their employees the most extra pay.

The Baltimore office, which has the longest wait times in the country, gave bonuses averaging $1,100 each to 40 percent of its workforce. The Oakland, Calif., office, which shut its doors to retrain underperforming employees, awarded nine out of every 10 workers a total of about $33,000 — almost enough to pay the standard year’s benefit to a veteran who is 100 percent disabled.

In Sioux Falls, S.D., claims workers processed claims four times as fast as those in Oakland and Baltimore but less than one in 10 there received extra pay last year.

It’s not your imagination—the federal government’s bureaucrats in this case have a strong incentive to put their own interests ahead of those of the American people. In this case, that specifically means the interests of Americans who were injured while serving the nation’s interests in the military.

We’ll give the next to final word to one frustrated employee of the Department of Veterans Affairs, who described how their colleagues did just that:

In 2008, Congress ordered the VA to review its work-credit system. A 75-page report produced by the Center for Naval Analysis in 2009 recommended the VA address perceptions that quantity receives more emphasis than quality, by changing the tasks that receive points to better reflect the actual work.

“This is one of the reasons why, as some managers noted, the inventory of old claims consists disproportionately of ‘difficult’ cases,” the report said.

A claims processor in Reno told News21 that this “breeds cheating” and that he has seen employees who aren’t making enough points go into “survival mode” and process only easy claims. Shifting performance points to reward backlog-related work would be more effective, said the worker, who, like others, requested anonymity for fear of reprisals.

“Your backlog is over here. But your points are in this direction. How stupid is that?” asked the worker.

It’s right in line with what we’ve come to expect for how Washington, D.C., works, or not.

Featured Image:
Social Security Office of Acquisition and Grants

Facebook Twitter Youtube

Support the Independent Institute when you shop on Amazon with the AmazonSmile program. Every time you make a purchase, 0.5% will be donated to Independent on your behalf, at no extra cost to you. Just visit, log in using your usual Amazon account details, and select the Independent Institute as your charity.


August 2013