Review of the Administration of Programs That Are Interrelated Between Department of Defense and the Veterans Administration

FPCD-78-75: Published: Dec 27, 1978. Publicly Released: Dec 27, 1978.

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As part of a continuing study of the payment of interrelated compensation to veterans by the Department of Defense and the Veterans Administration, GAO has found that in cases when a recipient received payment from both the VA and DOD, the correct readjustment pay, or offsets, were not made. In this case, the recipient would receive either an overpayment or underpayment with a correction usually being made at a later date. Situations of this kind raise the administrative costs of the benefit program and may impose hardship on the individual if a mistake required him to reimburse the government.

In 88 Air Force cases studied, individuals who had received readjustment pay after being involuntarily separated from the service had also received VA compensation. In these cases, adjustments should have been made to insure that payment was made only once. Omissions or incorrect action by administrators was usually the cause. The predominant cause of error was the failure of Air Force separation processing offices to enter readjustment payment information on the Department of Defense forms and thereby not advising DOD that payment had already been made. While GAO analyzed only Air Force readjustment pay, it is a safe assumption that errors of a similar nature exist throughout the services.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The logical approach to creating a more effective benefit system according to GAO is a reconciliation of readjustment and disability severance payments to insure that offsets were made correctly for members subsequently awarded VA disability compensation. It is the feeling of GAO that a long range plan should be developed which considers consolidating the pay functions that are interrelated under a single agency. Until such a system could be developed, the present system should be computerized at DOD and the VA. The goal of the program would be to verify the correct payment before compensation is made.

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