Washington — The Department of Veterans Affairs has abandoned a controversial plan to outsource the processing of the new GI Bill education benefits, after some veterans’ groups and members of Congress complained.
In a news release, the department said it had decided to develop a claims-processing system in-house because it had not received enough proposals from the private sector. James B. Peake, secretary of veterans affairs, blamed the shortage of bids on “external misconceptions as to the scope of the work involved.”
Ten vendors submitted proposals, and five were selected for further review, according to Keith M. Wilson, director of the department’s education service. Ultimately, those five failed to demonstrate that they “could deliver in the very short time frame we have to stand this up,” he said.
The American Legion, which had argued that a contractor would not provide the same level of service to veterans as do employees of the Veterans Affairs Department, applauded the decision. “The VA employs IT personnel with intimate knowledge of how to best serve the veterans’ community,” said David K. Rehbein, national commander of the group.
Congress passed the new GI Bill in June. The law will provide veterans of the wars in Afghanistan and Iraq with enough aid to attend the most expensive public institution in their states for four years, along with a stipend for housing and books. The Veterans Affairs Department announced in July that it would hire a contractor to administer the new benefits, saying the law’s requirements would tax agency resources. Congress held two hearings on the plan this fall at which lawmakers voiced doubts about the approach.
Patrick W. Dunne, under secretary for benefits at the department, said administering the new benefits would be “unusually complex” because payments are based on both in-state tuition and the cost of living, and thus would vary by state and region. But Dr. Peake insisted that the department would be ready to deliver the benefits by August 1, 2009, when the law takes effect. —Kelly Field
