In-Depth: Sponsoring Rep. Andy Kim (D-NJ) introduced this bill to help veterans who have been unfairly targeted by debt collection agencies due to errors by the Dept. of Veterans Affairs (VA):
“We should be honoring our veterans, not sending debt collectors after them because the VA’s systems have failed. I’m proud to introduce this bipartisan bill because our veterans are living paycheck-to-paycheck and they deserve a VA that works for them. After their sacrifice and what they’ve given to our country, holding the VA accountable for overpayments and protecting our veterans is the least we can do to say thank you.”
In his statement for the record to the House Veterans Affairs Committee as part of its legislative hearing on this bill, Rep. Kim said:
“Through several programs, the Department of Veterans Affairs provides monthly payments to veterans and other beneficiaries. Because the VA often relies on outdated systems to provide those payments, those recipients sometimes receive overpayments at no fault of their own. When this happens, it’s the veterans who pay a price. In order to compensate for their mistake, the VA will withhold payments from veterans. At a time in which 1.4 million veterans across the United States are struggling with poverty issues, withholding payment can have severe consequences for Americans who earned these benefits. Because there is no limit on how much the VA can ask a vet to repay, and no limit on how far back it can go to collect the debt, these sums can impact the credit and financial stability of veterans. The VA Overpayment Accountability Act aims to fix these issues by improving VA IT systems that are often the cause of these overpayments. It also provides credit protections for veterans who are the victims of overpayments and become targets of unfair VA practices. As a grateful nation, we should aim to honor our veterans, not send debt collectors after them because of a failure at the Department of Veterans Affairs.”
Original cosponsor Rep. French Hill (R-AR) adds:
“Too many veterans in my home state of Arkansas have suffered financially because of payment mistakes made by the VA. It is unacceptable that the lives of our veterans can be turned upside down at no fault of their own. The VA Overpayment Accountability Act takes the burden off our veterans when the VA makes a payment error and protects their hard-earned monthly benefit checks and credit scores. Veterans should never have to pay such a heavy price for the VA’s mistakes.”
Disabled American Veterans (DAV) supports this bill. Testifying before the House Veterans’ Affairs Committee’s Subcommittee on Disability Assistance and Memorial Affairs on October 22, 2019, its Deputy National Legislative Director for Benefits, Shane Liermann, said:
“DAV supports [this bill] as it is in accord with DAV Resolution No. 108, calling for reforms relating to recovery of debts by the VA and would bring necessary reforms to the VA collection and reporting processes. Erroneous reporting to consumer reporting agencies can have serious negative consequences for veterans and their families and this bill would provide protections and corrections to credit reporting.”
Barbara Kim-Hagemann, State Commander of the Department Of New Jersey Veterans of Foreign Wars, expresses support for this bill:
“The veterans residing in New Jersey support the efforts of Congressman Kim in correcting the harsh Veterans Administration procedures in recouping benefit overpayments from veterans who are barely living paycheck to paycheck. We have long advocated for a fully funded VA that fills employee vacancies, improves customer service and modernizes the health and benefit IT system.”
The VA opposes this bill in its current form, as it believes certain provisions are duplicative of existing laws. Testifying to the House Veterans’ Affairs Committee Subcommittee on Disability and Memorial Affairs on October 22, 2019, Ronald Burke, Executive Director of the Veterans Benefits Administration’s (VBA) Pension and Fiduciary Service, said:
“While VA appreciates the intent of this bill and is continuing to work with Committee staff to mature VA debt management, VA does not support this bill in its current form. We believe some provisions are duplicative of current laws… Further, other provisions present technical and implementation issues as detailed below.”
Specifically, Burke noted that the VA already submits corrections on debt information to consumer reporting agencies as required by law, and that the agency has “robust procedures” to ensure credit report errors are corrected. He also noted that VA is already required to provide notifications to veterans of debts incurred, and that the agency is already working to improve its systems and make debt viewable online ‘within the next year.” Furthermore, he raised concerns about a provision of this bill requiring the VA to allow veterans to review information about debt incurred by their dependents — he noted that in some cases, it may be inappropriate for VA to allow this for reasons of medical or financial privacy. Finally, Burke argued that the benefit error audit that this bill would require is unnecessary and unfeasible, as while the “VBA has numerous independent systems for the many benefits provided (Compensation, Education, Vocational Rehabilitation and Employment, etc.), [n]one of these systems currently have the capability to delineate the amount of debt due to the Veteran’s lack of/delayed response or VA benefit error.”
This legislation passed the House Veterans’ Affairs Committee by voice vote with the support of one cosponsor, Rep. French Hill (R-AR).
Of Note: The current method of processing dependency changes and communications errors between outdated IT systems has caused a rise in overpayments to veterans. Under current law, these overpayments are considered debts to the U.S., and the recipient is responsible for repaying them regardless of whose error caused it (their own or the VA’s). Consequently, VA notifies the recipient of the amount of the outstanding debt, and the beneficiary must: pay in full, establish a repayment plan, or request a hardship waiver to reduce the debt amount. If a veteran doesn’t respond to the VA’s attempts to notify them of the outstanding debts, the VA notifies credit reporting agencies of the debt.
Often, the VA attempts to recover these overpayments by withholding veterans’ monthly benefit checks, directly impacting the 1.4 million veterans struggling with poverty across the country (including 40,056 homeless veterans on any given night).
The VA reports that it already has processes in place to correct erroneous information it sends to credit reporting agencies, and that it’s working to provide electronic debt notifications (however, this system won’t be functional until 2022).
Summary by Lorelei Yang(Photo Credit: iStockphoto.com / CatLane)