VA Secretary Press Conference

Terrence Hayes (VA Press Secretary):  Good afternoon, ladies and gentlemen, and welcome to this month’s press conference. We appreciate you joining us. This is the last press conference of the year as well. So again, thank you for joining us. I know we have a lot to cover with not a lot of time. But also we have a unique and special guest joining us today that the Secretary will chat about. So with that, I’ll go ahead and turn it over to the boss, Secretary Denis McDonough.

Denis McDonough (VA Secretary):  Terrence, thanks very much. Hello everybody. Thanks for coming in. Thanks for joining us online. I have just one thing to say in my introduction, which is to introduce our guest today, Willie Clark, who is the VBA Deputy Under Secretary for Field Operations. He’s joining us remotely. Willie has been leading our historic–historically productive period here in producing claims filed at VBA, particular–including claims filed under the PACT Act. So we thought it was an important opportunity, as we head into the end of this calendar year, for Willie to give us a brief on what we’re seeing in terms of inventory, importantly, what we’re seeing in terms of production, and then of course an issue that we talked about every month, what we are seeing on the backlog, and importantly, what we can expect for the next several months on the backlog since we are now you know, a little bit more than three months, almost four months outside the window of our aggressive outreach effort in the middle and end of summer. So all those Veterans whom we urged to file claims with us, you know, are now at that 125 day mark with those claims pending–or will shortly be at that mark. So, without further ado, Willie, thank you for joining us. I love working with you. I love talking about football with you. Most importantly, I love your commitment to Veterans and outcomes for Veterans in the way you lead our field operations team at VBA with that specifically in mind. So, over to you.

Willie Clark, Sr (VBA Deputy Under Secretary for Field Operations):  Thank you, Mr. Secretary. First, thank you, Terrence for that gracious introduction. And Secretary McDonough, thank you for allowing me this time to share some pivotal milestones and forward-looking strategies we are working on in the Veteran Benefits Administration. Our commitment is steadfast to deliver more benefits more quickly to more Veterans than ever before. This is not just a goal. It’s a reality we create every day. And most important, we see the impact on Veterans’ lives. The PACT Act has spurred an unprecedented rise in the number of claims processed. Veterans are receiving the message that we want them to file claims, and that doing so will not reduce their current disability rating or their benefits. We want to emphasize that. Key to our progress is our strategic hiring. We have onboarded a dedicated workforce skilled in empathy and efficiency, ensuring that every Veteran’s application is treated with the utmost respect and urgency it deserves. With more than 32,000 VBA employees, well over 32,400 to be exact, working for Veterans combined with the automated decision support tools integration, these efforts have revolutionized our process. Now, if I may ask to please have the slide brought up.

Two weeks ago, for the first time ever, our claims processes produced decisions on more than 10,000 claims in a single day–10,285 to be exact. Last year, we decided a record number of claims, over 1.9 million. The third year in a row we set a record for most claims processed and we are 23% ahead of last year’s pace. As of November 26th, VA has processed more than 9000 Veteran claims in a day 17 times this fiscal year. And that’s since October 1st. Before this fiscal year, VA had processed more than 9000 claims in a day only three times in our history. VA is currently processing claims at 147 days, 200 days faster than in 2013 when the backlog was at its highest. And we’re within four days of the average days to complete a claim in 2022. These numbers aren’t just statistics, they represent the lives touched and families supported. As we push to deliver more benefits to more Veterans than ever in our history, it is equally important that Veterans and their families know these decisions are decided correctly. When looking at the quality of claims, issue by issue, over the last 12 months, VA gets it right 95% of the time. And in fiscal year ’23, we granted benefits 70% of the time. One recent example of the impact is an engagement between one of the public contact members from our Providence, Rhode Island regional office, and a Vietnam Veteran who had just suffered a stroke and needed help filing a claim. Considering the recent PACT Act legislation, our employee assisted the Veteran in filing a claim for coronary artery bypass graft related to Agent Orange exposure and hypertension. After completing the Compensation and Pension examinations, an expedited rating decision was made, increasing his overall service-connected disability rating from 0% to 90%. As a result, he received a retroactive payment and is now entitled to monthly compensation and healthcare services free of charge. Successful outcomes like this occur daily for Veterans across the country. Our work ensures every Veteran receives the benefits they have earned and deserve. The days to complete a disability compensation claim have been reduced substantially. Our inventory management is improved, reflected in the percentage of inventory processed in record time. More importantly, our grant rate has seen a remarkable increase. For example, the grant rate on all PACT Act claims is 76.5%. This is indicative of our commitment to getting to ‘yes’ for our Veterans using every tool at our disposal to connect conditions to their noble service. However, we must also address the challenges. We anticipate the backlog, as our Secretary mentioned, will increase due to the record number of claims that we received in August and September. This is not a setback, but a reflection of the trust and reliance our Veterans place on us. We are addressing these challenges with a comprehensive strategy. This includes continued hiring, enhancing our decisions for tools, and refining our processes to ensure efficiency and accuracy. Our plans are robust and responsive. We will not only maintain our current momentum, but accelerate it, ensuring that every Veteran receives the benefits they have earned. Thank you for your interest in Veterans, your support, and your commitment to our nation’s heroes. Together, we will continue to make a difference in the lives of those who have bravely served our country.

Terrence Hayes (VA Press Secretary):  Thank you, Mr. Clark, for joining us. And as you stated earlier, thank you to your team for all the hard work and dedication that they have to our Veterans, Veterans like myself. So I’m very thankful for that. So thank you for joining us today, sir. With that, we’ll go ahead and open the floor up to questions. Leo.

Leo Shane (Military Times):  Hi, Mr. Secretary, thanks for doing this, again. I wanted to ask with those high levels if this is sustainable at this point, those, you know, that’s quite a surge of activity. I don’t know if it’s more appropriate for you or for Mr. Clark to answer but is that simply, you know, overtime and putting more effort in and potentially burning out employees? Or is this a new level of production you think you can keep going to keep attacking that backlog?

Denis McDonough (VA Secretary):  Yeah, well, I think the more interesting answer will be Willie’s. But let me take a first swipe at and then Willie, if you don’t mind, we’ll go to you after that. And Willie, nice job. You all see now why I love working with Willie as much as I do. We’re very attuned to workforce burnout. I’ve been spending a lot of time on the road. I was just at the regional office in Providence week before last. I’ve now hit many of our regional offices. It’s very important for me to have an opportunity to hear directly from the workforce in terms of what they’re going through and what they’re experiencing. It is true that we believe as Willie’s closing comments or last less several comments pointed out, we believe the way we can really work through this historic level of claims is one, continuing to hire. And we’ve had a very aggressive, very successful hiring over the course of the last two plus years. We’ve talked about that a lot in this room. Component part to hiring is training. And we are moving the training very successfully. And as a result, we’re also watching very closely what the quality of the output looks like. So we watch it closely enough, thanks to Willie, that, when we see challenges on quality, we’ll make sure that we add additional training. The other way, in addition to hiring and training is decision support tools. We’re continuing to make progress, steady progress on the use of automated decision support. That’s a really important part of this. And then lastly, we think it’s really important that we take a look at all of our processes and procedures so that we’re not doing redundant work. A big part of this entire effort is the mandatory overtime. We have heard from the workforce and from our union partners that the mandatory overtime is demanding. For that reason, you know, Josh has worked very closely with Willie and found different times throughout the year to give some relief to our workforce on the mandatory overtime. We’ll continue to look for opportunities to do that. But last point, then we’ll go to Willie. Your question was, is this just going to be you know, focused on employees and, you know, managing burnout? The answer to that is absolutely no. We’re going to continue to invest in our workforce. One of–we’re continuing to invest in their resilience. One of the reasons that I’ve been so insistent on maintaining the telework, maximum telework flexibility in the field is because of the high efficiency rate and productivity over the last several years under that max telework. And because it’s one of the ways that our workforce has been able to manage this very high rate of performance. So let me stop there. Willie, you have certainly many more insights on this than I do.

Willie Clark, Sr (VBA Deputy Under Secretary for Field Operations):  Well, Mr. Secretary, you’ve given the lion’s share of them. And I’ll say this, we can sustain the output that we’re doing. And as Secretary McDonough mentioned, we have been using mandatory overtime. And as I’ve told my boss, Under Secretary of Benefits, Mr. Josh Jacobs, and Secretary McDonough, I don’t like to ask our employees to work overtime, mandatory overtime. But I like less to have Veterans waiting. So we are working mandatory overtime, that are brute force using the hiring and the great employees that we have in our agency, over 50% of whom are Veterans themselves. So we asked them to work this mandatory overtime. We are sustaining 9000 claims a day, as I pointed out earlier. This week, we had two additional 9000 output days, but it’s done with the Veterans great resources, Veteran employees, non-Veteran employees. And we look forward to continuing to hire, continuing with the automated assist tools that we use that enable us to go faster. And our hope is, is that we can downstream, that we can rely less on mandatory overtime or overtime at all, and just have our employees work regular time. But for right now, we’re sustaining our hiring. We are training. And we are producing at unprecedented levels. I mentioned earlier, we are at a 23% pace over last year. So, and every year continues to be record setting.

Leo Shane (Military Times):  What are the requirements right now for benefits process for mandatory overtime?

Denis McDonough (VA Secretary):  Did you hear that, Willie?

Willie Clark, Sr (VBA Deputy Under Secretary for Field Operations):  I didn’t hear the question.

Denis McDonough (VA Secretary):  Go ahead again if you don’t mind.

Leo Shane (Military Times):  Yeah. What are the requirements right now for benefits folks for mandatory overtime. What’s the requirement they’re under?

Willie Clark, Sr (VBA Deputy Under Secretary for Field Operations):  Yes, sir. The requirement is 20 hours per month for them to work additional overtime. And they’re given–they can work those hours, those 20 hours, however they wish. They choose. As Secretary McDonough mentioned, we have two respite periods per year. We have four weeks during the summer and additional four weeks during the holidays. In fact, we’ll be starting our second respite period from the middle of December through the middle of January. And our employees have opt-out, four weeks of opt-out periods throughout the year that they can just not work overtime as a result of other things, vacation and the like. So the requirement is 20 hours per month if they are able to work that many hours. We do have employees that have disabilities. And if they are not able to work those hours, then they don’t work the mandatory overtime.

Leo Shane (Military Times):  How long has that been in place at this point?

Willie Clark, Sr (VBA Deputy Under Secretary for Field Operations):  The mandatory overtime of 20 hours, we started that about 18 months ago, but our agency has worked mandatory overtime on and off as needed there for several years.

Leo Shane (Military Times):  Okay. Thank you.

Denis McDonough (VA Secretary):  Good. Thanks. Good questions. Thank you.

Terrence Hayes (VA Press Secretary):  David.

David Elfin (cyberFEDS):  Mr. Clark, this is David Elfin at CyberFEDS. Follow-up to Leo’s questions. Secretary McDonough talked about the 125 days and August and September the rush that began then. Do you anticipate the rush, you know, backing off a little bit and maybe you’re not going to have to work to these levels not so many 9k days, you know, when you come back in January after the respite?

Willie Clark, Sr (VBA Deputy Under Secretary for Field Operations):  Yes, sir. Great–great question. We have–we know now that our inventory will peak next year and then it will start to decline. And we are anticipating that in 2025, that our inventory will go back to 100,000 claims, and we’ll be able to sustain that. So we will continue to hire. We’ll continue our automated decision support tools, they will enable us to continue with this outstanding output that we’re doing. Again, thanks to our employees, our great employees that give us full day’s work for full day’s pay. We are hopeful that that in 2026, that–or sooner, that we can start backing off of the mandatory overtime, still maintaining voluntary overtime. But it is our hope, it is our plan, that–I’ll remove the hope–it is our plan that mandatory overtime will be not necessary in our employ due to continued hiring and our automated decision tools.

David Elfin (cyberFEDS):  Can you be any more specific when you said next year? Do you have a target month?

Willie Clark, Sr (VBA Deputy Under Secretary for Field Operations):  We’re sitting in 2025. You know, understanding that Veterans are still coming in filing claims, which we–we’re happy about. We love that. That’s a part of the PACT Act, the outreach. We want our Veterans to come in and file claims. And the more they come in, then of course our inventory grows. And if we don’t get those claims completed in 125 days, they what we call rollover into the backlog. So our projections for receipts and our projections, we have an entity performance and analysis group that gives us some projections, and they’ve been pretty accurate. And but we’ll continue to get the outreach, get the word out to Veterans and their families, and as the claims come in, we will ask and continue with the unprecedented production that we have going on right now.

David Elfin (cyberFEDS):  Thanks you.

Terrence Hayes (VA Press Secretary):  Thanks for the question, David. We’ll go to Lucy.

Lucy Bustamante (NBC Universal):  Thank you, Terrence. Good afternoon, everyone. I wanted to get a little bit of background on a separate topic here with the equity team. Appreciate the heads up via email this morning about Laurine Carson’s retirement. My question to Secretary McDonough is when you all named Laurine Carson to lead the new equity team, did you all know that she wanted to retire so soon after naming her in that leadership position?

Denis McDonough (VA Secretary):  Yeah, thanks so much. The answer is no, we did not. And I think, you know, we had Laurine in here in this room with us. I think you may have picked up on how much I admire Laurine. And she’s had an unbelievable career at VA–34 years, with a legacy of caring and committed service to Veterans and their families, caregivers, survivors. She started in the Newark Regional Office and continued in that career. She rose through the ranks of VBA. And we chose her in 2023 because of her remarkable experience across many assignments. So, her work over many years has helped us deliver on our nation’s promise to Vets that will take care of them after they’ve taken care of us. And I will just say I will sorely miss Laurine Carson. But–or and her legacy will continue with us, the many people she trained and the many great partners that she developed. So, it’s a longer answer than you asked for. But the answer is did we know? We did not. And I’ll just say one other thing is I’m saddened that she retired but I absolutely support her decision and wish her nothing but continued success.

Lucy Bustamante (NBC Universal):  Mr. Secretary, we’ve been waiting for an update from the equity team under her leadership. Is there anything that you could talk about as to one, why she decided to retire after being named into such a high profile position? And also, what was she able to accomplish in this short time? Can you talk about any of the progress and the analysis that she and her team have been able to do since June?

Denis McDonough (VA Secretary):  Yeah, thanks very much. I think it would, rather than me speak for Laurine, I’d rather let her speak for her decision to retire. I can speak for myself, though, again, when I say that I’m saddened that she retired, though, again, no one has earned that–there is no more hard earned retirement than then Laurine’s, I’ll tell you that. So I’ll let Terrence work with you to get in Laurine’s words, why she chose to retire. I think it’s important to know that you’re right that we’ve been working with Laurine and importantly, her team, to continue to make progress on the equity questions. These have been issues for decades. And we are going to continue to work them. I’m very pleased that Under Secretary Jacobs also announced that Army Veteran and 27-year VA employee, Cheryl Rawls, will be named as the Director of the Office of Equity Assurance. Most recently, she led the department’s Outreach Transition and Economic Development Office, we call that the OTED office. And that’s responsible for global Veteran and family centric outreach, community and stakeholder engagement, and the transition assistance program. So I have every confidence that under Cheryl’s leadership, the Office of Equity Assurance will continue to work identifying disparities

that exist within VBA, understanding their root causes, and eliminating them. And when we have updates on that process, Lucy, I promised you before and I promise you again today that we will share them with you. We’ve appreciated your attention to this matter, and your interest in it. So we’ll be reporting it out to you.

Lucy Bustamante (NBC Universal):  Secretary, just very quickly, anything that you can say about whether the work has continued behind the scenes, or did it come to a stop? How has the work itself, the analysis itself, been impacted by this announcement, by this transition?

Denis McDonough (VA Secretary):  You know, the work obviously continues as a major priority of mine. So I ensure that this work continues. And I don’t have any, as I’ve said to you now, I don’t have any update on the analysis, or on the decisions in that space. When we do have them, I’ll definitely make sure that we share them with you.

Terrence Hayes (VA Press Secretary):  Jory.

Jory Heckman (Federal News Network):  Good afternoon. Thanks for doing this. To follow up with the hiring the workforce element of things, about a month ago with the last one of these, Mr. Secretary, I know you were talking a little bit about some of the recruitment and retention incentives that VA has at its disposal, whether that’s in the PACT Act or otherwise. And that some additional things were in the works. Do you have an update on where things stand with that, and just, you know, getting people on board and more importantly, getting them to stay on the job for a long period of time?

Denis McDonough (VA Secretary):  That’s a really good question, Jory. You know, we just published last week, our most recent update of the workforce dashboard. And I’ll make sure that we get that to you. Inside that dashboard, which we–I forget if that’s the fourth or the fifth of the workforce dashboards we’ve published. We have updates on where we’re using various hiring incentives, recruitment incentives. I don’t have anything over and above that for you right now. I will say that two things about hiring. I think we continue to make good progress on hiring. But I have been very clear with Under Secretary Elnahal, for example, and Under Secretary Elnahal has been clear with me and with his workforce that now that we have had such a successful year of hiring, we have to make sure that those new employees are seeing Veterans. And we have to see that the increased outcomes–the increase hires translates into improved access for our Veterans. And I have every confidence that will be the case. And we’ll continue to update you on that throughout the year as well.

Jory Heckman (Federal News Network):  And on a related note, I think the VA put out research recently saying that employee satisfaction is positively correlated with Veteran experiences that, you know, they both trend up in the same direction. I don’t think that’s a startling discovery. But you know, in terms of you know, that recognition and making sure that both the Veteran and the employee experience continue to trend upwards, any further updates on just what more VA–or what VA has done, and what more VA can do to ensure that?

Denis McDonough (VA Secretary):  Well, we’re–you’re right that employee experience and Veteran patient experience are oftentimes different sides of the same coin. And that when our employees are feeling valued and invested in, that care is going to reflect that. And so that is why we have prioritized our work on the reboot Taskforce. We talked about this last month too, where we are aggressively countering any manifestations of burnout among our workforce. This is why I was so pleased that the President’s Executive Order on artificial intelligence last month, or I guess that was earlier this month–the months run together–highlighted that the first use cases for artificial intelligence here at VA will be use of new AI technologies to directly address clinician burnout questions. Lastly, we now through the use of our E signal, we are regularly generating data directly from our employees the same way we generate that data through the surveys from our Veterans, to ensure that we have the most timely and actionable intelligence about what to confront. So we aggressively use the all-employee survey every year. We aggressively–we are now aggressively supplementing that with the employee survey. And then when we have opportunities to go out with specific targeted surveys, for example, a survey on how future of work is proceeding here in the National Capital Region, we’re going to do that. So that survey should be hitting inboxes of our employees here in the National Capital Region here in the relatively near term. Each of those are opportunities for us to assess exactly what the employee experience is, and where we need to address any shortfalls.

Jory Heckman (Federal News Network):  All right. One quick follow-up to that last point about future work. You mentioned, maximum telework flexibility still, for those VBA field employees, I know that headquarters is a different story, but can you shed a little bit more light or clarify just what maximum telework means for them, like in terms of days of the week, and just how that is kind of helping them manage the workload and deal with burnout and related things?

Denis McDonough (VA Secretary):  Yeah, I’ve been very clear with the field that we will fight to protect their ability to maintain max telework. And max telework is defined as in the workspace, two days a pay period. Okay. That’s what max telework is. So we’ll continue to defend their ability to be at max telework as long as they’re producing at those amazing numbers that Willie Clark just showed us on the screen. So, I think we’re in a position to continue to make–to continue to successfully make and win an argument that says our max telework workforce in the field, especially at the ROs is producing at an historically high level. We’re measuring the productivity, we have the numbers to show, and as long as we continue to do that, I feel like we’re gonna we’re gonna win this argument.

Jory Heckman (Federal News Network):  Thanks again.

Terrence Hayes (VA Press Secretary):  Thanks, Jory. We’ll turn to Quil. I feel like I just chatted with you.

Quil Lawrence (NPR):  Does seem recent, doesn’t it. I hope y’all had a great Thanksgiving.

Terrence Hayes (VA Press Secretary):  Same to you.

Quil Lawrence (NPR):  And I think you’ll know that I want to ask you about mortgage [inaudible] foreclosures. I’m wondering, can you tell if that pause is working and if the services are agreeing to pause on this? I have spoken to Veterans even since the pause who are getting a mixed message from their mortgage servicers, saying, ‘Oh, we don’t care what you read on the internet, you still have to pay?’ Can you tell if that pause is working? How many people it’s helping?

Denis McDonough (VA Secretary):  Yeah, thanks very much. Before I do that, let me just comment, Quil, I heard you’re reporting on the greater LA homeless situation. I thought it was a very fair story. So I thank you for it. I think it was a very in depth story. You obviously reported it out very hard. I also noted, you know, I have recently joined the Veterans there on campus, in the tiny homes, they have a kind of self-governing board that meets every Thursday morning, their time. It’s afternoon our time, but I was able to join them recently for the meeting. And what I thought was interesting is that the issues that they’re working through in terms of self-governance, the issues that they wanted to talk to me about, in terms of, you know, the VA role, very closely tracked the issues you reported out. So I just want to say thank you for that.

Now, back to your question. We have notified the public of VA’s call for mortgage servicers to pause foreclosures on all VA bank loans. And we’re working urgently to put out a circular to provide official guidance to that effect. I’m confident that that will be out very soon. In the meantime, we have actively been meeting with mortgage servicers to prepare them for this official guidance that will be coming out shortly and to answer any of their questions. In fact, in just recent days, we met with the servicers that represent over 90% of all the mortgages in question. We felt good about that meeting. Once we put out the guidance, we expect that any foreclosures that have been filed since November 17, 2023, will be put on hold, along with any other in-process foreclosures on VA bank loans. This pause–this will pause the foreclosure process for these Veterans through May 31, next year, 2024, giving us the additional time that we need to help these Veterans find solutions to stay in their homes. Now, we’ve been–I think we’ve communicated this to you and to your teammate, I think his name is Chris Arnold, how much we’ve appreciated your reporting. Let me say directly to Veterans. If you are facing imminent foreclosure, we encourage you to call us at (877)827-3702 or to visit us at va.gov/housing-assistance and let us work with you to address any of these questions or concerns that you’re confronting. I hope that answers your question.

Quil Lawrence (NPR):  Thank you. Thank you so much. And we have heard from a lot of people who were delighted to say the least when that pause came through. But there were 4000 or so people who were already foreclosed on who were in this forbearance program. Is there anything VA is going to be able to do to repair the damage that has happened with him?

Denis McDonough (VA Secretary):  Well, we’re gonna work through every–through each of these, Quil. And you know, we’re continuing to obviously talk with you and Chris and we’ll continue to talk to the press and we do–I just want to say one more time to any Veteran who’s struggling to make their payments, who has experienced the kind of situation that you’ve just talked through, please reach us directly. I’ll give you the number one more time (877)827-3702 or visit us at va.gov/housing-assistance so we can help, we can advise, we can work with you, so that you can manage your situation which is going to be unique to any others. So please be in touch with us. Again, I hope that answers the question.

Quil Lawrence (NPR):  Yeah. And if you’ll indulge us a little bit later, Chris is on the call. He broke this story. And he has a couple of questions as well. But I’m just wondering, in the reporting of this, it seems that people in industry and VSOs and lenders and people on the Hill saw this coming. They knew that when the forbearance was over, there would have to be a way for Vets to get back onto payments and they had been warning about this, as far as we can tell, since the forbearance program ended a year ago. I’m just wondering, what happened? How did this not get fixed and seen sooner? I mean, who was it in the VA who knew this was happening and thought it was fine?

Denis McDonough (VA Secretary):  Yeah, I’m not sure that anybody thought it was fine, Quil, and we obviously, are constantly striving to be better. If there’s anybody to be held account–to account here, it’s me. I’ve said that in this room a lot. I happen to believe that. So, we’ll make sure that we understand what went wrong in the past. And at the same, you know, I just say that, you know, it’s, I think it’s worth noting that the–our team, you know, was able to work with some 80,000 Veterans on their mortgages during the course of the pandemic. So I’m very proud of their work on that. I want to just underscore that. And I think–I think that’s been borne out in your reporting. And I think you and Chris have reported that. So, I’ve appreciated that. But we’ll, believe me, we’ll go back and find out what happened. Right now, though, we want to make sure that we’re working with those Veterans affect–those Veterans and their families affected

by this transition. And, you know, we’re standing by to do that. And we’re going to make the changes that we need to, and especially in this period, where we can maintain the moratorium in the pause on all foreclosures until next May, so we can be in a position to roll out further support to manage this transition.

Quil Lawrence (NPR): Thank you. Thank you so much. Hope you and your team have a great holiday.

Terrence Hayes (VA Press Secretary):  Thank you, Quil. We’ll go to Rebecca.

Good afternoon, Rebecca.

Rebecca Kheel (Military.com):  Good afternoon. I just have a quick follow-up on the benefits claims. And apologies if this was in the slide that you showed. It was a bit hard to read that.

Terrence Hayes (VA Press Secretary):  No worries, I’ll ensure that I get the slide to each of you. So that’s on me.

Rebecca Kheel (Military.com):  Great. Well, I heard mentioned that the backlog is expected to grow with the increase in claims in August and September. I didn’t hear any actual numbers attached to that. So what is the projection right now for how much the claims backlog is expected to grow? And where does it stand right now?

Denis McDonough (VA Secretary):  Yeah, Willie, you’re bound to have better numbers than I have. But let me take a swipe at this. I was just looking at my dashboard this morning and on my dashboard is a couple–it always lags a bit. But I think the backlog is about 308,000 cases as of my dashboard, and again, that could be last Friday’s numbers for example. The overall inventory of claims right now at VBA is a little over 1.1 million. And we should be anticipating days–if I just go back and refresh for you guys, the days we’re reporting out in terms of claims filed, and let’s just take that period. Are you not hearing me or something, Rebecca? Oh, you were waving.

Rebecca Kheel (Military.com):  Sorry. Somebody was waving to me off screen.

Denis McDonough (VA Secretary):  Oh, tell them I said hi too. So, you’ll recall at the end of July and beginning of August, we had days where we were getting 20, 25, 30,000 claims filed a day. And so you can’t directly translate that from then to now, because some of those claims will have worked through, right. Willie gave the average about 140 some days, but that’s a median, right. So we have cases that are getting resolved much sooner, and some that take longer. But that should just give you kind of a scope. I don’t know, Willie, do you have a specific number of projection on backlog? Do we have enough kind of wherewithal, enough kind of situational awareness to make that determination?

Willie Clark, Sr (VBA Deputy Under Secretary for Field Operations):  As of yesterday, sir, the backlog was just over 319,000. But as you always are, you are correct in your assessment, we know that the backlog is going to crest anywhere between 450,000 next year, to possibly as high as maybe 700,000. Before, again, I’m gonna repeat–it is going to be on the decline thereafter, and it’s going to quickly decline. And in 2025, the backlog is going to come back down. We will continue to hire aggressively, we’ll continue with the mandatory overtime until that time, at least. And again, we need the mandatory overtime. We continue to get additional lift from our automated decision report–support tools. That’s going to help us roll faster. We’re also improving on our training, we’re improving on our ability to come up with regulations to make the jobs easier, manual references and updates to checklists that makes the job easier. But, you know, I did mention that there are some–there were some headwinds. There were some challenges. And these are some of those challenges that the backlog and the inventory, which right now as of yesterday stands at a little over a million, 1,000,077, but it will continue to grow.

Rebecca Kheel (Military.com):  Thank you.

Denis McDonough (VA Secretary):  Okay. Who’s next?

Terrence Hayes (VA Press Secretary):  Thanks, Rebecca. We’ll go to Chis back at NPR. My apologies, Chris.

Chris Arnold (NPR):  Can you guys hear me?

Terrence Hayes (VA Press Secretary):  We can.

Chris Arnold (NPR):  Secretary McDonough, nice to meet you. I wish I was there in person, but–

Denis McDonough (VA Secretary):  Nice to meet you too. It’s been a while since I’ve made this joke. But we’re happy to hear that you got the audio thing figured out. It took Quil a couple visits to make that happen. But anyway.

Chris Arnold (NPR):  Quil was telling me about that. Yeah.

Denis McDonough (VA Secretary):  What do you guys care about audio anyway? It’s no big deal.

Chris Arnold (NPR):  The audio is always busted at NPR–I don’t know. It works on the radio, but–

Denis McDonough (VA Secretary):  There you go.

Chris Arnold (NPR):  So, I mean, first, I just want to say we almost feel bad asking you more somewhat pointed questions about all of this because the speed with which you guys responded and put a foreclosure pause in place was striking to everybody I talked to about it. So–

Denis McDonough (VA Secretary):  Well, don’t feel bad, believe me. We feel bad enough for everybody. So you don’t have to feel bad for us.

Chris Arnold (NPR):  And, you know, we have talked to a lot of relieved Veterans who were right on the precipice of losing their house. And so this was really, really good news to them. I want to ask you about like another group of people. And bear with me here to explain it, but there are folks who were threatened with foreclosure who accepted a loan modification after the VA ended that PCP program, it was called, that gave them an affordable path to move the payments to the back of the loan and they could–the missed payments–and they could just go back to like paying their mortgage.

When that went away a year ago, people didn’t have any good options, and a lot of them felt sort of forced into accepting a deal where, like this Vietnam Veteran we talked to in the last couple of days, his interest rate went up to 8% on the loan mod. He was told on the front end, ‘Hey, look, don’t worry, the payments will just get moved to the back. It’ll be affordable. Your interest rate’s gonna stay the same.’ You know, he’s in a wheelchair. His payment went from 1750 a month to 2400. He’s got a very small pension. His wife like works a couple days a week at the mall. And they can barely afford the water bill now and stuff. And he’s like not buying groceries. And we’re still trying to get numbers on this, but it seems like there’s a lot of people who got sort of forced into these bad loan mods, because it–and it wasn’t what they were promised on the front end when they took this forbearance when they needed the help. And I’m just wondering if that’s something you guys are looking at or open to looking at, like, when this VASP program comes back out or gets rolled out, or if the PCP thing gets turned back on, is–might there be a way to help some of these people who are not like right now on the verge of foreclosure, but they ended up in a really bad place and it wasn’t the deal that they were promised when they agreed to do this forbearance thing on the front? It’s a little complicated. So I hope that makes sense. But–

Denis McDonough (VA Secretary):  Yeah, it does. It make sense. Well, sadly, it doesn’t make sense. But it does make sense, if you know what I mean. The–I want to start where I started in answering Quil’s question, which is first and foremost, we want any Vet who is struggling to make a payment to reach out to us directly at (877)827-3702 or to visit us at va.gov/housing-assistance. We are standing by to help them, to advise them, to work with them, so they can manage their unique situation and keep their house. So I think you rightly point out to the fact that the VASP program, which we anticipate late next spring is an opportunity for us to relook these questions. But we’re not just waiting for that, as I said, and as you just acknowledged, to those Veterans who are currently facing foreclosure, we’re calling on mortgage servicers to pause those foreclosures on VA bank loans. We’re confident that we will get their cooperation on that. For those Veterans in a situation like the one you talked about, Chris, who are not facing foreclosure, but who are struggling with their loan payments, we are here now to help. There may be bigger policy fixes later. But we want them to be in touch with us now. While we don’t have the authority to change the loan terms or the interest rates, we do have assistance like financial counseling, loan technician support, and more that are available anytime starting now. We’re also concerned obviously to hear that some of our Vets feel that they’ve been misled. So we’re looking into that and talking to other federal partners who are constantly looking at questions like consumer protection. The bottom line is this, we want any Veteran who’s struggling with their loan to reach out to us regardless of whether they’re facing foreclosure currently, or as you’ve just said, at risk of foreclosure at some later date. In every case, we will do everything in our power to help those Vets.

Chris Arnold (NPR):  Okay. Thanks for that. And yeah, it–I understand it’s a sticky wicket, because if somebody’s already signed a bunch of paperwork and agreed to a new loan, and that loan is in a securitization pool somewhere, what do you do? At the same time, you know, if someone has a VA loan, and they were told, ‘Hey, it’s going to work this way.’ And then it didn’t end up working at all that way and their mortgage payments, some of them almost doubled, from like two grand to four grand a month and people are really hurt. And, so you’re saying they should call–are you saying it’s not–in some cases, it might be resolvable, they should reach out, I guess is what you’re saying?

Denis McDonough (VA Secretary):  What I’m saying is that, you know, we have a staff at loan guarantee office of more than 300 people whose job it is to work with Veterans to manage these programs, and I think there’s enough texture in each of these individual cases that we would want to make sure that we can understand each individual Veterans experience, what they’re going through, what the terms are of their agreement, so that we can see what tools we have that can help them.

Chris Arnold (NPR):  Okay. And I just have one more quick question. There’s some talk of–this is all kind of related. Is there anything that you guys could use from Congress in the way of expanded authority, either to deal with people in the situation we were just talking about, and we think it could be thousands of people in that situation. Or, you know, to turn the PCP program back on? Rolling out a new program is always difficult, and it’s a bottleneck no matter how well it’s done. And, you know, there’s 40,000 people now, either in the foreclosure process or delinquent and headed in that direction. I think there’s some effort and talk on the Hill about turning on both solutions, again, for people. But the VA might not have the authority. Is there anything you’d like to see from Congress that could help you fix this?

Denis McDonough (VA Secretary):  I think what I’d rather–what I’d like to do is take that question–we’re focused on addressing this at the moment, right now, to help those Vets in the situations like those that you’ve pointed out. I have not looked at specific requests that we may need from Congress. There may in fact be something, so rather than rule that in or rule that out, right now, let me promise to get back to you when we have a concrete answer on that.

Chris Arnold (NPR):  Okay. Thanks.

Terrence Hayes (VA Press Secretary):  David.

David Elfin (cyberFEDS):  Secretary McDonough, I wanted to ask you an IT question that’s not Cerner. You’ve got a program under the leadership of Nathan Tierney with special salary rates for IT people. One, I don’t know if you’re aware of it. And two, just wondered how much–how important it is to VA because so many agencies have had IT problems over the year and you guys are such a huge agency that IT has not been one of your strengths either over the years.

Denis McDonough (VA Secretary):  I disagree with that characterization actually. I think IT is a strength of VA over the years and has been over the years. And I think it’s a particular strength at the moment. And, you know, I think it’s worth just commenting quickly, you know, over the course of just the last several months we’ve gone to the hill or come to you guys, oftentimes because you guys alert us to a challenge to help us identify a problem. And we’re quick to note those, to address them. Increasingly, and this has been a benefit by the way of the future of work posture here in the National Capital Region, where informal conversations in the hallway lead to–or after meetings,  before meetings, lead to greater shared understanding and collaboration, including identification of problems. So, we are by no means perfect, but we are getting better at identifying problems, identifying them ourselves, and working to address them.

Next point. Special salary rates. I’m very intimately aware of them, because I’ve been arguing with OPM for them almost since the time I got here. And we’re really grateful to OPM to give for it having given us the opportunity to test these SSRs, special salary rates, for our particular classes of employees, particularly IT. They were first out of the box last summer. I don’t–you’ll see some of the data in the workforce dashboard that we published last week of where we’re using this. This is really a great opportunity for us. And we’ve talked in this room, and many of you have reported on, the innovative recruitment efforts we’ve been undertaking, including in the valley–in Silicon Valley and in Seattle, for example, where we’ve had aggressive outreach to that industry, which has been a lot of transition in the last year. I think we’re really leading the way on AI. I’m really excited about that, for our efforts here. And the SSRs have helped us on that.

Lastly, I talked last month about the critical skills incentive and the fact that we got more, we got a little overzealous on the execution of the critical skills incentive. There is a number of reasons that I thought it was important to cancel those critical skills incentives for our executives in the VA central office. At the top of the list of the reasons that it’s important for us to manage the critical skills incentive very carefully and prudently is–applies also to careful and prudent execution of special salary rates, because we are showing a pathway forward for the rest of the federal government. And we have these authorities in a way that many of our federal agency partners do not and would like to have it. So we want to make sure that we manage these tools very, very carefully. So I’m not sure I answered your question, but I think I’ve said a lot about SSRs.

David Elfin (cyberFEDS):  Quick follow-up on your last point. But you have such a big picture of you having been in the Obama White House, and you know how the government has struggled, even going back that far with IT hiring because Silicon Valley and Seattle can pay so much more. Is your feeling so far since last July, that this is working, and it’s going the way you guys want it to with the SSRs, particularly in IT?

Denis McDonough (VA Secretary):  I think the SSRs are a big help to us. And we are more competitive as a result. We do not have to pay dollar for dollar. People come to work at VA, including our tech–our technologists come to work at VA, because they’re drawn by the mission. We have the best mission in the federal government, which is we get to care for Veterans. They had our back now it’s our turn to get their back. So we just need an increment more, funding and salary to supplement that mission, which is again, is by far the most attractive tool in recruitment at VA.

Second point. There are other really important tools that we did establish back in 2013. And some even before that. Presidential Innovation Fellows, which we’ve made good use of here at VA. And most importantly, the United States Digital Service, which is the source of our CTO here at VA. Charles Worthington came to us initially as detailee, under the US digital service program. So, that continues to be, as you saw in the President’s Executive Order on artificial intelligence last month–earlier this month, continues to be a fulcrum effort to bring technologists into the government. And it’s not hard because what more fulfilling mission could one have than an opportunity like this at VA? So we just have to get out there and keep making our case. Supplemented by the SSR, I feel good about our chances when we do that.

David Elfin (cyberFEDS):  Thank you. Happy holidays. Happy New Year.

Denis McDonough (VA Secretary):  Thank you.

Terrence Hayes (VA Press Secretary):  Thanks, David. Leo.

Leo Shane (Military Times):  Yeah, since this is our last meeting with you before the end of the year, it looks like Congress is not going to deal with the budget for the rest of this month and the rest of this year. We’re here in the possibility of a continuing resolution for all of 2024, now fiscal 2024. What would–what would that mean for VA? I know there’s advanced appropriations. I know you’ve talked about some of limiting with this budget–budget impasse, you know, the impact on Veterans. But I don’t know what happens if we don’t ever get a budget and we just have to push this forward to 2025?

Denis McDonough (VA Secretary):  Yeah, you know, I think I think rather than comment about that right now, because it’s so–it’s so speculative, let just say, Leo, that,

you know, we’re able to do what we do much more effectively when we have a full year appropriation. You know, I’ve made that argument in here a lot of times. You know, things like hiring are more difficult under CR. But I don’t I don’t really want to kind of

really make that argument right now, because I really hope that Congress takes advantage of this time between now and middle of January to get us a full year–an appropriation for the rest of the year. Both the House and Senate have passed bills now and for VA, I think it’d be great for them to get that done. And, you know, we’ve proven that things go better when we have that. And I think we’ve also tried to reassure Congress that we’re a reliable partner. We try not to surprise them. We try to be very careful in our investments. And we’re really proud of our team. We just got our 25th clean financial audit. There’s obviously things to work through in that audit. And we will continue to work through that. But I’m very proud of our team. You know, we just got some early feedback from the IG on how we’re doing with the execution of the toxic exposure fund, which is the fund that helps us enact the PACT Act–execute the PACT Act. All these things are indications that we are very serious stewards of the taxpayers’ dollars, and we take that responsibility very, very seriously. And we’re just trying to convince Congress it’d be great to get a full year appropriation.

Leo Shane (Military Times):  Thank you.

Terrence Hayes (VA Press Secretary):  Thanks, Leo. We’ll go back to Lucy.

Lucy Bustamante (NBC Universal):  Hi. I’m so sorry about this technical difficulty here. Just going back to a little bit of the history of Ms. Carson’s retirement here. I’m curious. I’m learning a lot of information. I’m curious to know whether she was one of the 170 VA leaders who had to give back a piece of the 10 million that was doled out in the critical skill incentive program. That’s something that I know that Leo reported on back in September. So full credit there, but is Laurine one of the people that had to pay back some of that money? And did that affect her decision to retire?

Denis McDonough (VA Secretary):  Yeah. You know, Lucy, I really appreciate the question. I should have said, by the way, as I said to Quil and his reporting on West LA, I saw some recent reporting that you did on Veteran response teams, which I thought it was very powerful reporting. So thank you for that.

I just really want to respect Laurine’s ability to speak for herself on her decision. You know, I love Laurine Carson. I love working with her. I love her poetry, by the way. She was the Poet Laureate of the VA. So, and I miss working with her a lot. I’m just not gonna characterize the decision she made. I’d really rather she do it.

Lucy Bustamante (NBC Universal):  Is there anything that you can say to update us on what’s going on with the individuals that were involved in taking that money and the payback plan for the critical skill incentive program?

Denis McDonough (VA Secretary):  Yeah, you know, we–the critical skills incentive–incentives for executives in the National Capital Region here, we cancelled those. So each of those executives have either paid that back or are working through a payback plan or are using the established process to appeal. And so, I don’t have any kind of summary of what’s happening in there. We’ve been trying–we tried to be very transparent about the fact of the decision in the first instance, the fact of the decision to cancel, why we canceled, and now we’re just going through the mechanics of that process of getting the critical skills incentive payments back.

Lucy Bustamante (NBC Universal):  Do you still maintain, sir, that this was no wrongdoing and that this was basically an issue with implementation?

Denis McDonough (VA Secretary):  I maintain that this was overzealous execution. I have not said that there’s no wrongdoing. I’ve said that any accountability here should be assigned to me. Because this happened here. And I’m responsible for what happens in the agency. I do not believe that there’s any evidence or any reason to believe that this was somebody trying to benefit themselves. And in all cases to ensure that we handle this better going forward and consistent with the answer I just gave to Dave about all of the pay authorities and incentives that we have, we did ask the IG to take a look at it himself. And so we’ll anticipate a report from the IG, you know, when he’s ready. And so I don’t want to speak for him on that. But that’ll be an important opportunity for us–for me to learn from my mistakes here and to make sure that we don’t repeat them in the past–in the future.

Lucy Bustamante (NBC Universal):  Thank you.

Terrence Hayes (VA Press Secretary):  Jory.

Jory Heckman (Federal News Network):  To follow up on David’s questions about the special salary rate, I know as I understand it, at least, you guys have authority to set those special hourly rates for I believe, any title five employees at VA, recognizing how well it’s been going for the VA OIT side of things, the IT and cyber employees. Are you guys looking at other areas to implement a special salary rate to kind of address those acute–

Denis McDonough (VA Secretary):  Yeah, you know, we don’t have carte blanche on them, Jory. We work with OPM to get SSRs for particular classes of employees. So I think what maybe we should do maybe on one of our future monthly pressors, we could have Kurt come in and talk about how he’s using them. Or we can just set up a roundtable or something with Kurt and then maybe with the HR experts at VHA. Because VHA does have some authority to use some SSRs. But we–it’s not–right now we have a lot of flexibility for SSRs in IT. We have some SSR opportunities in VHA, but much more cabined. And as I say, the way I’ve seen this as is we have to perform in the hopes that we can get additional authority. But I also take to heart the fact that we have to perform and show to Congress how serious we are about this, because especially as it relates not just to SSR, but to things like the CSIs that Lucy was just asking about. We uniquely have the CSI. Nobody else in the federal system has it. So we want to be able to show that we can use that, not as an end of the year bonus, but rather as a critical incentive–an incentive for critical skills that are in short supply. Which is why for example, we use the CSIs to good effect across the enterprise, outside of VA central office for things like police, which is a critical skill, which is in short supply in many of our markets. And as a result, this last fiscal year, after several years of losing–net losing police officers, we grew the force by 7%. That’s a good outcome. That’s a better outcome. It’s gotta get much better for us to catch up with vacancies. Because we really rely on our police to do a lot of stuff. And they’re the best trained workforce, police workforce in the federal system, particularly as it relates to de-escalatory tactics. I’m really proud of them. I want them to know how proud of them we are. And we want to add personnel to their teams.

Jory Heckman (Federal News Network):  And as far as your interactions with the Office of Personnel Management on this, I know I think about a year ago you guys were leading the charge government wide for kind of a special salary rates that we know that VA is now kind of, at this point, the only ones I believe using it. You know, is OPM keeping an eye on this scene as you guys are leading the charge in this and just kind of what are those interactions like?

Denis McDonough (VA Secretary):  OPM is a great partner to us. They’re constantly helping us out. The administrator over there, the director over there, Karen Ahuja, who has been a great friend of Veterans, a great friend of VA. So yeah, but they’re watching us like a hawk. You know, they got the pencils very sharpened. And, you know, we feel duty bound to make sure that we’re doing a good job with this authority.

Jory Heckman (Federal News Network):  All right, thanks.

Terrence Hayes (VA Press Secretary):   All right. I think that does it. First and foremost, I want to thank Mr. Clark for joining us today. His insight on where we are and what our teammates in VBA are doing for our Veterans on the claims front is historic. So again, thank you, Mr. Clark, for your participation today. Thank you, Mr. Secretary, as always. Members of the press and most importantly our workforce. I wish you a happy holidays as we hit into 2024. Thanks everybody.

Denis McDonough (VA Secretary):  Thanks everybody. Thanks Willie. Appreciate you.