The VFW And American Legion’s Veterans Affairs Conflict Of Interest

Joanne Butler | Former Staffer, House Ways and Means Committee

With Father’s Day approaching and VA Secretary Eric Shinseki’s resignation last week, I am reminded of a promise my late Dad (WWII vet, bronze star medalist) demanded I make when I was in 8th grade: That I never send him to a VA hospital. I expect if my Dad were here today, he’d be calling me to say ‘see, I told you.’ My question: where were the American Legion and the Veterans of Foreign Wars when the problems began to bubble up last year and earlier this year?

A young vet’s answer to me was these groups seemed to be more reactive than proactive. Could this be because these groups also represent veterans in the VA benefits system?

In some ways, the VA situation is a familiar bureaucratic story: career civil servants not informing the political appointees of actual and potential problems, and the political appointees putting too much trust in what the career employees are saying.

Imagine a group of top career managers sitting around the Secretary’s big table, with their Cheshire cat grins, murmuring soothingly, ‘nothing to see here, Mr. Secretary, move along.’ But the department outside the Secretary’s suite is ruled by the iron law that political appointees come and go; career people stay on forever.

What makes the VA story unique is the role of politically powerful outside groups who represent veterans’ interests, ones that can get a meeting with the Secretary, or any Senator or House member by just picking up the phone. Plus a phone call will get them major media access on demand.

By contrast, what if the Association of Builders and Contractors had major issues with the Department of Housing and Urban Development? I don’t know if the HUD Secretary (or any Senator or House member) would clear his or her schedule to meet with the ABC head, but it’s a safe bet the ABC and its HUD woes wouldn’t get a prime slot on cable news.

So where were these service organizations when the VA hospital system was spinning out of control? Were they afraid of reprisals due to their work representing benefits claimants?

To its credit, the American Legion was one of the first to call for Shinseki’s departure on May 5, but it was in reaction to an inspector general’s report from the VA. However, news organizations had been doing investigative work on the hospital situation for months before that.

Why would the service organizations be cautious in criticizing the VA? It’s because a little-known but major function of the American Legion and the Veterans of Foreign Wars is helping veterans or their families file for benefits and representing claimants in the VA appeals process. And while by law they cannot charge for helping someone file a claim, they can charge for representational services if the claim is denied and appealed.

Federal law also puts a “reasonable” fee arrangement at twenty percent of past due benefits (benefits the claimant would have received if a positive outcome had resulted at the first step in the decision process).

Any good trial lawyer will tell you that part of their ‘zealous representation’ duty is to have a good working relationship with the decision-maker — usually a judge, magistrate, etc. This also means the attorney and his or her firm doesn’t publicly criticize their local judicial system. For example, let’s say attorney Green is representing a client before Judge Anderson; meanwhile, another member of the same firm is standing on the courthouse steps having a heated press event alleging that Judge Anderson is corrupt nitwit. Green’s client immediately switches to a different firm – and all other clients who have business before Judge Anderson do the same.

There’s a similar dynamic between the VA and veterans’ service organizations, which have a vested interest (fee payments) in not rocking the VA boat. These organizations must have a good working relationship with the VA benefits decision-makers if their clients are to win. Would this relationship be jeopardized if the Legion or VFW shifted into attack-dog mode over problems at VA hospitals?

Thus, I note while the Legion called for Shinseki’s resignation a month ago, the VFW took a milder tone, stating he needed take “strong action” and calling for more Congressional oversight. Could this have an impact on the Legion’s success rate in benefits appeals?

Further, a little-noticed aspect of the Legion’s May 5 statement was its call for the resignation of the under-secretary of benefits, Alison Hickey. Give credit to the Legion, for making what I consider a bold move, in light of its representational work.

Nevertheless, if I was the head of the Legion or VFW, I would be embarrassed that it took a VA inspector general report to reveal the problems on the ground at the Phoenix hospital.

These organizations, with their wide network of local units, ought to be providing a safe haven for vets and VA workers (who are usually vets themselves) who have complaints. At the very least, they should be a helpful, reliable resource to the inspector general.

The House Republicans’ proposal to allow the VA secretary to fire senior career staff isn’t much of a solution either. There are always senior career staff that are friendly to a particular administration (a former boss called them ‘quasi-political’ staff). When the other party takes control of the White House, this proposal will make it easy for the new Secretary to fire those who were deemed too cooperative with the previous administration – as opposed to transferring them to someplace outside the beltway, or reassigning them to a ‘turkey farm’ agency within the department (where they could keep their pay and benefits, albeit in a windowless office in the basement).

While there’s no quick fix for an agency that’s been sick for decades, it’s clear the VA needs fundamental changes.

First, the Congress and the service organizations need to stop reserving the top job for a veteran. The job requires someone with strong management experience of large organizations plus an IT background (hospital system experience would be very useful). If the best person for the job is a veteran, so be it. But a lack of military service should not stop the President from nominating someone who could do the job. General Shinseki had a long and successful career in the U.S. Army, but it’s clear his experience did not prepare him for dealing with a civilian bureaucracy.

Second, I would propose giving the top political appointees six-year terms, allowing them to serve in the other party’s administration. Big organizations need long-term leadership. Congress recognized that need in 1994 when it split the Social Security Administration from the Department of Health and Human Services, and allowed the administrator to serve for a six-year term.

Third, the VA benefits side needs to be split from the hospital side, resulting in two independent agencies that are able to cooperate, but remain separate.

A split is necessary, because the current VA Department must oversee a large, complex benefits approval system, while also managing a huge national hospital system. Too many pots on the stove results in a Secretary who must leave much to their senior career staff; no Secretary would have the time or resources to do an independent review of information provided by staff. Shinseki had complete confidence in his career staff, and we know how well that worked out.

Splitting the VA into two separate agencies also would allow service organizations to continue to represent claimants seeking cash benefits – while freeing them up to be a vocal watchdog over the hospital agency’s operations (and thereby increase accountability).

A split will upset certain groups who insist the chief of veterans’ affairs must be a cabinet-level position. But what difference did cabinet status make at the Phoenix VA hospital, where (according to the VA inspector general) 1,700 vets were “at risk of being lost or forgotten” in the deep recesses of the hospital’s appointment system?

Cabinet status is cold comfort to the vet who’s waiting by the phone, or dumped in a hospital hallway.

When a department has been very sick for a very long time, band-aid fixes will not work. Deep changes are needed to change the corporate culture.

Decades ago, my Dad had a fear of ending up in a VA hospital. Fortunately for him, he never did. But millions of veterans today have no choice but to use a VA hospital for their care. America owes them a system – with a corporate culture – that works and is accountable for its actions.

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