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“Detrimental Delays: Reviewing Payment Failures in VA’s Education Programs”

House Veterans’ Affairs Subcommittee on Economic Opportunity Hearing

December 16, 2025 (recording here)

HEARING INFORMATION

Witnesses & Written Testimony (linked) (Panel One):

• Ms. Margarita Devlin: Acting Principal Deputy Undersecretary for Benefits, Veterans Benefits Administration, Department of Veterans Affairs

• Mr. Kenneth Smith: Executive Director at Education Service, Veterans Benefits Administration, Department of Veterans Affairs

• Mr. Justin Parke: Managing Director, Digital GI Bill Program Manager, Accenture Federal Services

Witnesses & Written Testimony (linked) (Panel Two):

• Ms. Ashlynne Haycock-Lohmann: Director, Government & Legislative Affairs, Tragedy Assistance Program for Survivors

Keywords mentioned:

• Veterans, dependents, survivors, VA education benefits, Chapter 35, Digital GI Bill, payment failures, student impact, government shutdown, manual reconciliation, automation issues, communication breakdown.

IN THEIR WORDS

OPENING STATEMENTS FROM THE COMMITTEE

• Chairman Tom Barrett, leading in place of Chairman Derrick Van Orden, stated that the subcommittee had convened to examine the Chapter 35 education-benefit payment delays tied to the Digital GI Bill program and emphasized his role on the Technology Modernization Subcommittee and his priority of making the VA’s technology work for veterans. He said the payment failures, which he traced back to August, had affected as many as 75,000 dependent children and spouses, with benefits going directly to students and causing financial hardship and threats to enrollment. He argued that the VA had failed both by missing payment timelines and by refusing to communicate consistently with schools, beneficiaries, Congress, and other stakeholders, even if the shutdown had worsened conditions. He said the hearing aimed to determine who made the decisions, who was at fault, and how the VA would ensure accountability and prevent repeat failures.

• Ranking Member Chris Pappas said the hearing was overdue and argued that Congress lacked testimony from a Senate-confirmed leader who could answer questions and accept responsibility for the Chapter 35 payment failure. He alleged that the VA had stonewalled congressional inquiries and largely failed to acknowledge the delays publicly for months, leaving beneficiaries and schools without timely information and forcing Congress to learn key details only after significant delay. He contended that calling the problem a “glitch” mischaracterized what happened, because the software behaved as designed while the VA’s assumptions and planning proved wrong and were not validated or corrected in time. He also criticized shutdown-related decisions and cited constituent harm while urging bipartisan oversight and accountability for restoring reliable benefit delivery.

SUMMARY OF KEY POINTS (PANEL ONE)

• Ms. Margarita Devlin said she was appearing with Education Service Executive Director Kenneth Smith to address challenges tied to Release 8 of the Digital GI Bill platform and its impact on Chapter 35 benefits. She said the VA completed the final transition in August 2025 from the legacy Benefits Delivery Network to the modern Digital GI Bill system, and while the core migration was technically successful, a 2024 decision requiring manual reconciliation significantly increased processing time and could not be avoided given the deadline to decommission the legacy system. She attributed the delays to business decisions and governance and planning constraints, including compressed testing, limited risk elevation, a surge in Chapter 35 claims, and shutdown-related furloughs that reduced help for students and schools seeking information. She said the VA implemented automation and policy changes to reduce the backlog and prevent recurrence, and she emphasized strengthened governance, an automation-first approach, and improved change management going forward.

• Mr. Justin Parke introduced himself as the Accenture Federal Services program manager for the Digital GI Bill engagement and said the work aimed to make it faster and easier for veterans and their families to access education benefits. He said Accenture helped replace the VA’s legacy mainframe with a cloud-based claims processing platform that enabled more automation, including same-day processing for a majority of education claims, and he cited large volumes of claims and benefits delivered through the platform. He said delayed Chapter 35 payments were unacceptable but rejected reports of a system glitch, arguing that the system functioned as required and that the backlog stemmed primarily from a 19 percent increase in Chapter 35 students and a one-time manual validation requirement established by the VA in 2024. He said Accenture worked with the VA to automate portions of the manual reconciliation, with requirements approved in late September and the automation deployed on November 15, and he reported that the deployment reconciled large numbers of claims and substantially reduced the backlog.

• Chairman Barrett opened questioning by asking the panel to confirm the processing timeline and whether the certificate of eligibility was the first step, and Ms. Margarita Devlin confirmed that it established eligibility.

• Chairman Barrett asked where the manual step occurred, and Ms. Devlin said it happened later during conversion of returning students’ claims from the legacy system into the new system, not for brand new enrollments.

• Chairman Barrett pressed who at the VA made the 2024 decision to require manual reconciliation, and Ms. Devlin said she was not at the VA then and could not identify the decision-maker, while Mr. Parke said he was program manager but was not in the room for that decision.

• Chairman Barrett asked whether Accenture warned the VA about risk, and Mr. Parke said there were debates, but the VA believed veteran claim examiners could handle the workload, and he suggested current leadership would likely choose automation.

• Ranking Member Pappas challenged the VA’s delayed and incomplete responses to congressional letters and asked Ms. Devlin whether she or Mr. Smith had been directed not to communicate with Congress, and she said no.

• Ranking Member Pappas asked what caused the delay and why Congress and beneficiaries were left in the dark, and Ms. Devlin apologized and said responses required detailed data review and internal concurrence processes.

• Ranking Member Pappas pressed for who approved outbound communications and who limited them, and Ms. Devlin said the VBA developed the content, she was the last VBA executive to review before department-level approval, and communications were not intentionally limited.

• Ranking Member Pappas also asked whether the VA was directed not to communicate during the shutdown and who approved furlough and recall decisions for key staff, and Ms. Devlin said the VA followed shutdown requirements and the VA contingency plan and worked with attorneys on how to handle recalling staff for work not previously encountered in that context.

• Rep. Abraham Hamadeh accused the VA of failing veterans and families and asked how much Accenture had been paid and what beneficiaries received for that spending. Mr. Parke said Accenture had been paid $686 million and argued the work enabled near-instant certificates of eligibility, processed millions of claims, delivered tens of billions in benefits, and retired legacy infrastructure that posed a serious risk to the VA’s ability to deliver benefits.

• Rep. Hamadeh suggested Accenture was paid when the system was not being used, and Mr. Parke said the system had been used daily since 2021 with very high uptime and no interruption.

• Rep. Hamadeh pressed on the backlog and timing, and Mr. Parke said the backlog stemmed from increased Chapter 35 volume and the VA’s manual reconciliation requirement, and he explained that automation to reduce manual work followed the VA’s approval of requirements later in the year.

• Rep. Delia Ramirez said education benefits were earned and expressed alarm that delays jeopardized basic needs, then asked why Congress was not notified immediately once the VA learned reconciliation was taking far longer than planned and whether the VA understood the financial harm. Ms. Devlin said the VA was concerned, did not understand the magnitude before the shutdown, and said the fall backlog was largely cleared, citing current pending counts and increased payment volume compared to the prior year.

• Rep. Ramirez asked if it was acceptable that beneficiaries had no call center support and Congress received no casework responses during the shutdown, and Ms. Devlin said the VA followed the VA contingency plan and the rule of law for shutdown operations, which Rep. Ramirez said was unacceptable.

• Rep. Ramirez then asked what changed for spring and why survivors should trust the assurance, and Mr. Smith said the VA and Accenture automated reconciliation, pre-reconciled large numbers of potential spring beneficiaries, and increased the share of Chapter 35 claims processed through automation.

• Rep. Tim Kennedy delivered remarks linking benefit delays to broader workforce shortages and access-to-care problems at the VA. He cited persistent vacancies, staffing strain at facilities in his district, and oversight findings that staffing shortages contributed to delayed consults and appointments. He criticized hiring freezes and proposed or announced job reductions as worsening the VA’s workforce crisis and undermining veteran care and benefits delivery. He argued the human cost of understaffing included burnout, declining quality, and veterans suffering harm, and he said Congress had an obligation to uphold the nation’s promise to veterans.

• Rep. Nikki Budzinski asked how the VA’s shift to an automation-first approach would avoid becoming an overcorrection that caused erroneous payments. Ms. Devlin said automation accuracy was high, argued that an automation-first strategy earlier would have prevented the current situation, and cited accuracy rates for original and supplemental claims while saying many errors were technical and did not necessarily affect payment amounts.

• Rep. Budzinski criticized the lack of notification to Congress and beneficiaries and urged proactive communication before spring classes, and Ms. Devlin said early communication was the VA’s practice but the VA did not grasp the magnitude early and she said spring term claims were being processed timely with a significant portion automated.

• Rep. Budzinski also asked whether resignation or early retirement programs reduced claims processor capacity, and Ms. Devlin said the VA excluded claims processors from those programs.

  Rep. Morgan McGarvey said “payment delays” understated the harm and argued the VA broke trust by leaving survivors and dependents uninformed, then asked why the VA did not warn Congress and students up front that claims would take longer. Ms. Devlin said time estimates tied to the 2024 business decision suggested reconciliation would take seconds, but the VA later learned it could take hours and acted to correct the problem, and she said the VA did not know the full magnitude early enough to notify as it otherwise would have.

• Rep. McGarvey asked who was held accountable, and Ms. Devlin said she was not at the VA when the original decisions were made and could not identify who made them.

• Rep. McGarvey asked how the VA would prevent spring delays and commit to transparent communication, and Ms. Devlin committed to better communication and cited increased automation and manageable pending spring counts. She said the release timing was driven by the end of the legacy system contract and the risk and cost of keeping that system operating.

SUMMARY OF KEY POINTS (PANEL TWO)

• Ms. Ashlynne Haycock-Lohmann testified on behalf of the Tragedy Assistance Program for Survivors and said the fall-semester Chapter 35 payment delays harmed surviving families in ways that were deeply personal, not merely technical, drawing on her own experience as a surviving child who relied on these benefits. She emphasized that Chapter 35 payments were modest relative to other education programs and that many beneficiaries were dependents of fully disabled veterans or survivors of service-connected deaths, making late or incomplete payments a destabilizing blow that forced families into debt, disrupted enrollment, and created hardship. She said the VA had not adequately briefed the VSO community, that stakeholders learned about the scale of the problem from families and schools, and that the shutdown compounded the harm by closing the hotline and furloughing communications while students remained in the dark. She urged changes, including making the GI Bill hotline and education claims processing essential during shutdowns, restoring regular stakeholder calls, avoiding rollouts at the start of academic terms, and publicly sharing rigorous testing and rollout plans.

• Chairman Barrett apologized to affected survivors and dependents and said the committee wanted to prevent a repeat, while committing to work with the VA to reengage regular outreach with VSOs so information flowed both ways. He floated a policy idea to furnish the certificate of eligibility at the moment a student became eligible, rather than waiting until enrollment years later.

• Chairman Barrett then asked whether any schools had actually unenrolled students over delayed payments. Ms. Haycock-Lohmann said some schools threatened unenrollment, but her team intervened by sharing the law and coordinating with schools and scholarship partners to prevent drops, and she said she was not aware of any school that followed through.

• Chairman Barrett asked how many TAPS cases were affected and whether the backlog was resolved, and Ms. Haycock-Lohmann said they handled several dozen true hardship cases and heard of hundreds to possibly thousands delayed, while reporting that cases they elevated were paid quickly and she had not heard of outstanding payments recently. She also said TAPS had not been briefed on spring risks and would typically only learn of problems once rear-paid benefits failed to arrive.

• Ranking Member Pappas asked how TAPS learned about the issue and what communication, if any, they received from the VA, and Ms. Haycock-Lohmann said she learned from students and schools and coordinated with other VSOs, while relying on committee staff for insight and still receiving no VA briefing or pathway forward.

• Ranking Member Pappas entered a report into the record and asked what four months of missed benefits did to recipients, and Ms. Haycock-Lohmann said most Chapter 35 beneficiaries were young adults with limited savings and credit who faced missed rent and car payments, food insecurity, and heightened vulnerability to predatory lending.

• Ranking Member Pappas asked what more the VA should do beyond her recommendations, and Ms. Haycock-Lohmann emphasized transparency and partnering with the VSO community to communicate in plain language through trusted channels, because VSOs could help families plan and connect to stopgap supports if they had timely information.

• Ranking Member Pappas concluded that transparency would have had real value even if payments were late, and Ms. Haycock-Lohmann agreed it would have enabled earlier coordination with scholarship partners instead of last-minute scrambling.

• Ranking Member Pappas finished by saying the hearing was important but argued the problem was not fully solved, especially heading into the spring 2026 semester. He said veterans, families, and survivors needed a larger voice, and he wanted testimony from more VSOs on member impacts. He also said the committee had received reports of delays beyond Chapter 35, including Chapter 31 and Chapter 33, and urged rigorous bipartisan oversight of those programs as well. He called for a follow-up hearing after the holiday recess, with presidential appointees testifying, and said accountability was required.

• Chairman Barrett thanked the second-panel witness and earlier witnesses and said the committee would keep examining how the VA could resolve delayed payments and prevent recurrence. He said this would not be the final hearing on the Digital GI Bill this Congress and noted that Chairman Van Orden took the issue seriously. He said the committee would set expectations for how long approvals should take, define target timelines, and determine how to enforce those standards, with oversight overlap through his Technology Modernization subcommittee.

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