VA’s New Tuition Program Stung by $416 Million of Overpayments
Policy + Politics

VA’s New Tuition Program Stung by $416 Million of Overpayments

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Compared to the tens of billions of dollars in Medicare and Medicaid fraud and overpayments that the Obama administration has been wrestling with in recent months, this is relatively small potatoes.

Yet the Government Accountability Office has just blown the whistle on the embattled Department of Veterans Affairs for $416 million of post-9/11 GI bill overpayments that were granted for education in fiscal 2014. Roughly one in four veteran beneficiaries and about 6,000 colleges and schools received overpayments that were eventually ferreted out by the VA. All but $152 million of the overpayments were recovered.

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The GAO criticized the VA for shoddy oversight and management of the tuition program and noted that the agency was still trying to collect an additional $110 million of overpayments from prior years – primarily owed by veterans or the schools themselves. And the potential for even greater overpayments or wasteful spending is considerable in light of the size of the overall program.

The VA provided $10.8 billion in Post-9/11 GI Bill education benefits to almost 800,000 veterans in fiscal year 2014. The GAO was asked by Sen. Tom Carper (D-DL) to investigate overpayments for the program, which according to the GAO “can create financial hardships for veterans who are generally required to pay them back and which can result in a significant loss of taxpayer dollars if they are not collected.”

“VA does not monitor the full extent of Post-9/11 GI Bill overpayments and collections,” the GAO report stated. “For example, VA does not regularly track the number of overpayments or the amount of uncollected student debt. Although VA was able to provide the information in response to our data request, it is not something the agency actively monitors on a regular basis.”

Overpayments increased by nearly 20 percent between 2013 and 2014, the only two years for which data was available. Most of the overpayments resulted from changes in veterans’ enrollment status, which in fairness is something the VA has only limited control, according to the GAO. In practice, that means that the VA GI bill program provides funding on the strength of veterans’ enrollment plans. If a veteran subsequently drops a class or withdraws from school, the original payments suddenly become “overpayments.”

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Carper, the ranking Democrat on the Senate Homeland Security and Governmental Affairs Committee, said in a statement that the GAO report highlights serious shortcomings in the VA’s system for monitoring and collecting overpayments and urged the VA to fully adopt the GAO’s recommendations for improving the program.

“The report [also] raises broader questions about the unnecessary complexity veterans and schools encounter when dealing with this program,” Carper said. “I often say that we must use common sense in everything we do here in the Senate and across the federal government. I’m concerned the VA’s current system for administering Post-9/11 G.I. benefits is too confusing, and that the burden for repaying overpayments falls disproportionately on veterans, many of whom may be unaware that they may have been given too much money and owe it back.”