Is the Agile Process to Blame for VBMS Timeline and Cost Overruns?

In FY 2014, VA paid approximately $5 billion in pension claims and $58 billion in disability compensation.  Total costs to implement the system that processes these claims (VBMS) has exceeded $1 billion.  The original price tag was projected to be $579 million.  VA has requested another $290 million for this year for continued enhancements to the system.  The VBMS implementation process has garnered much congressional attention due to the massive backlog of claims, long processing times, and skyrocketing system costs.  GAO has been monitoring progress of VBMS implementation over the years.

VBMS has been instrumental in lowering the backlog of claims which peaked in 2013 at 600,000, but now totals 80,000, a historic low for VA.   

However, lawmakers are balking at the price tag and the inability of VA officials to pin down a completion date or final system cost.  VA executives claim that some of the uncertainty stems from the nature of the agile development process. 

During a Congressional hearing on the subject in mid-January, Beth McCoy, VA’s deputy undersecretary for field operations, said VA has been rolling out new features and functionality every three months, delivering 17 major software releases and 56 minor updates over the past four years.

VA’s VBMS program management office director, Dawn Bontempo, testified that “…we can release software every three months and bring high value functionality to the field as quickly as possible to serve our veterans. [Use of the agile methodology has] allowed us to take and build requirements as we were going along.”

GAO reported as a result of VA’s VBMS efforts, 95% of records related to veterans’ disability claims are electronic and reside in the system. However, VBMS was slated for completion in 2015, and that did not happen. VBA has not yet produced a plan that identifies when the system will be completed.

GAO identified and made recommendations regarding three VBMS areas that could benefit from increased management attention:

• Cost estimating: The program office does not have a reliable estimate of the cost for completing the system. Without such an estimate, VA management and the department’s stakeholders have a limited view of the system’s future resource needs, and the program risks not having sufficient funding to complete development and implementation of the system.
• System availability: Although VBA has improved its performance regarding system availability to users, it has not established system response time goals. Without such goals, users do not have an expectation of the system response times they can anticipate and management does not have an indication of how well the system is performing relative to performance goals.
• System defects: While the program has actively managed system defects, a recent system release included unresolved defects that impacted system performance and users’ experiences. Continuing to deploy releases with large numbers of defects that reduce system functionality could adversely affect users’ ability to process disability claims in an efficient manner. 

VA concurred with GAO’s recommendations.  Watch for continued scrutiny of this system, its costs, and the claims backlog.