Improving Accreditation Process and Strengthening Legal Education Requirements for Accredited Agents and Attorneys

SUPPLEMENTARY INFORMATION:

Under 38 U.S.C. chapter 59, the Secretary of Veterans Affairs has authority to recognize attorneys, agents, and Veterans Service Organization (VSO) representatives for the preparation, presentation, and prosecution of benefit claims, regulate fees charged by accredited attorneys and agents, and prescribe the rules of conduct applicable while providing claims assistance. More specifically, 38 U.S.C. 5904(a)(2) requires the Secretary of Veterans Affairs to establish regulations governing the qualifications and standards of conduct for agents and attorneys. Section 5904(a)(2) sets forth minimum qualifications and standards to be included in VA regulations, serving as a floor on top of which VA may prescribe additional conditions, qualifications, and standards of conduct.

On May 22, 2008, following the enactment of the Veterans Benefits, Health Care, and Information Technology Act of 2006 (Pub. L. 109-461), VA published a final rule in the Federal Register (73 FR 29852) that addressed accreditation of individuals, standards of conduct for all individuals authorized to assist claimants before VA, and attorneys' and agents' fees. That rule, in pertinent part, established the initial accreditation requirements for attorneys and agents as well as the ongoing CLE requirement in 38 CFR 14.629(b). Under the current regulation, as part of their initial accreditation requirements, attorneys must have a law degree, be a member in good standing of a State bar, and during the first 12-month period following initial accreditation, complete 3 hours of State-bar approved CLE training covering Veterans benefits law and procedure. As part of their initial accreditation requirements, agents must pass a written examination administered by VA, which covers a wide range of topics covering the applicant's knowledge of VA benefits and the VA claims adjudication process, and complete the same CLE training as attorneys. Both agents and attorneys must complete 3 hours of additional CLE training every 2 years.

This rulemaking would require applicants seeking accreditation as an agent or attorney to complete 3 hours of qualifying CLE before they become accredited and require accredited agents and attorneys to annually complete 3 hours of qualifying CLE. The intended effect of this proposed rule is to strengthen the current CLE requirements to ensure that attorneys and agents representing claimants and appellants for VA benefits are better qualified to provide such representation.

Since the 2008 final rule, VA's Office of the General Counsel (OGC) has continued to develop and fine-tune the accreditation process and the monitoring of accredited representatives. OGC's experience in administering the accreditation program over the past 16 years has highlighted the need to bolster the CLE requirements for accredited agents and attorneys as well as ensure that these individuals have already received CLE regarding Veterans law at the time of their accreditation.

In its August 2013 report, “VA Benefits: Improvements Needed to Ensure Claimants Receive Appropriate Representation,” GAO-13-643, the Government Accountability Office (GAO) concluded, among other things, that current VA regulations do not sufficiently ensure that accredited representatives have adequate program knowledge to effectively assist clients. GAO recommended that VA “explore options and take steps to strengthen initial and continuing knowledge requirements for accreditation for all types of representatives.” In response to and following our own independent consideration of this recommendation, we are proposing to require applicants for accreditation to take 3 hours of CLE before applying for accreditation, and accredited attorneys and agents to take an additional 3 hours of CLE annually. This proposed rule would amend 38 CFR 14.629(b)(1)(iii) to require applicants for accreditation to complete 3 hours of CLE within 6 months prior to submitting their application and amend 38 CFR 14.629(b)(1)(iv) to require that agents and attorneys complete an additional 3 hours of qualifying CLE on Veterans benefits law and procedure not later than 1 year from the date of initial accreditation and every 1 year thereafter.

In addition, the proposed rule will specifically require that the initial CLE include instruction on the VA standards of conduct contained in 38 CFR 14.632. Section 14.629(b)(1)(iii) provides that the qualifying CLE attended taken during the first year after accreditation “at a minimum, must cover the following topics: representation before VA, claims procedures, basic eligibility for VA benefits, right to appeal, disability compensation (38 U.S.C. Chapter 11), dependency and indemnity compensation (38 U.S.C. Chapter 13), and pension (38 U.S.C. Chapter 15).” In revising this section, we propose to add a parenthetical explanation that the topic representation before VA includes the VA standards of conduct contained in 38 CFR 14.632. This proposed revision is not a substantive change, but rather a change to emphasize the importance of this topic for accredited individuals.

Based on our experience in administering the accreditation program, we believe the proposed changes to § 14.629(b)(1)(iii) and (iv) would help ensure that claimants for VA benefits are represented by qualified individuals.

The next proposed change would improve the administration of the accreditation program. Current VA regulations already impose various certification, notification, and self-reporting requirements on accredited agents and attorneys, either on an annual basis or within 30 days of certain specific events. VA believes that requiring accredited agents and attorneys to provide notice of changes in contact information is necessary to efficiently administer the accreditation program. Therefore, VA is proposing to add 38 CFR 14.629(b)(1)(v), requiring that agents and attorneys notify the Office of the General Counsel within 30 days, of any changes in contact information.

To improve the efficiency of VA's process of accrediting agents and attorneys, VA is proposing to modify the information that it collects during the application process to include email addresses for character references. VA proposes to amend 38 CFR 14.629(b)(2)(viii) to add email addresses as part of the information necessary for the applicant's three character references. Additionally, VA proposes to eliminate requiring the phone numbers for the applicant's three character references.

Next, VA is proposing two changes to more accurately reflect the accreditation process. First, VA is proposing to revise 38 CFR 14.629(b)(2)(v), the information that it collects about an applicant's mental health, to match the information requested on the application form and to clarify that this inquiry is focused on current conditions and disabilities. Current section 14.629(b)(2)(v) requires “[i]nformation concerning whether the applicant has ever been determined mentally incompetent or hospitalized as a result of a mental disease or disability, or is currently under treatment for a mental disease or disability”; however, the information requested on the application is whether the applicant has any condition or impairment (such as substance abuse, alcohol abuse, or a mental, emotional, nervous, or behavioral disorder or condition) that in any way currently affects, or, if untreated or not otherwise actively managed, could affect the applicant's ability to represent claimants in a competent and professional manner. Second, VA proposes to amend § 14.629(b)(2)(ix), which refers to the claims agent examination being administered by the District Chief Counsels in the Office of the General Counsel. Because the examination is now administered centrally, the proposed rule would simply refer to the examination being “administered under the supervision of the Office of the General Counsel.”

To become an accredited agent, an applicant must demonstrate character and fitness, and sufficient knowledge of VA benefits law. Character and fitness is determined by VA after conducting an extensive review, and knowledge is demonstrated by achieving a passing score on a written examination administered by VA. Under current regulations, VA must first make an affirmative determination of character and fitness before applicants may sit for the examination. Inefficiencies arise under the current process whenever VA conducts a character and fitness review for an applicant who subsequently fails the examination. To improve the efficiency of the accreditation process, we propose to reverse the current order of events by administering the claims agent examination prior to conducting the character and fitness review. Reviewing character and fitness for only those applicants who have first passed the claims agent examination will ensure a more efficient allocation of VA time and resources.

This proposed sequence of events is similar to how most States process applications to become a licensed attorney and is necessary because under the current process, VA is experiencing difficulty keeping pace with the rapidly growing pool of applicants seeking accreditation as claims agents. Accordingly, we propose to amend 38 CFR 14.629(b)(6) to require that an applicant for accreditation as a claims agent first pass the written examination before VA conducts its character and fitness review, and, in conjunction, provide that no applicant shall be allowed to sit for the examination more than twice in any 1-year period and that the Office of the General Counsel may offer the claims agent examination a minimum of twice per calendar year.

Executive Orders 12866, 13563, and 14094

Executive Order 12866 (Regulatory Planning and Review) directs agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 14094 (Executive Order on Modernizing Regulatory Review) supplements and reaffirms the principles, structures, and definitions governing contemporary regulatory review established in Executive Order 12866 of September 30, 1993 (Regulatory Planning and Review), and Executive Order 13563 of January 18, 2011 (Improving Regulation and Regulatory Review). The Office of Information and Regulatory Affairs has determined that this rulemaking is not a significant regulatory action under Executive Order 12866, as amended by Executive Order 14094. The Regulatory Impact Analysis associated with this rulemaking can be found as a supporting document at www.regulations.gov.

Regulatory Flexibility Act

The Secretary hereby certifies that this proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act (5 U.S.C. 601-612). The factual basis for this certification is the fact that the proposed rule would generally be small business neutral as it applies only to applying for and maintaining accreditation to represent claimants for VA benefits. At a minimum, this proposed rule would affect the approximately 6,200 attorneys and 520 agents currently accredited by VA. However, it would not have a significant economic impact on these individuals because it would impose only a requirement for accreditation of completing 3 hours of CLE before applying and an additional 3 hours of CLE annually, the costs of which would not be significant. VA estimates the cost to an individual attorney or agent to be less than $300.00 on average. Therefore, pursuant to 5 U.S.C. 605(b), the initial and final regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604 do not apply.

Unfunded Mandates

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any 1 year. This proposed rule would have no such effect on State, local, and tribal governments, or on the private sector.

Paperwork Reduction Act

This proposed rule includes provisions constituting a revision to a current/valid collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521). The revision also requires approval by the Office of Management and Budget (OMB). Accordingly, under 44 U.S.C. 3507(d), VA has submitted a copy of this rulemaking action to OMB for review and approval.

Comments on the new collection of information contained in this rulemaking should be submitted through www.regulations.gov. Comments should be sent within 60 days of publication of this rulemaking. The collection of information associated with this rulemaking can be viewed at: www.reginfo.gov/public/do/PRAMain.

OMB is required to make a decision concerning the collection of information contained in this rulemaking between 30 and 60 days after publication of this rulemaking in the Federal Register . Therefore, a comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication. This does not affect the deadline for the public to comment on the provisions of this rulemaking.

The Department considers comments by the public on a new collection of information in—

• Evaluating whether the new collection of information is necessary for the proper performance of the functions of the Department, including whether the information will have practical utility;
• Evaluating the accuracy of the Department's estimate of the burden of the new collection of information, including the validity of the methodology and assumptions used;
• Enhancing the quality, usefulness, and clarity of the information to be collected; and
• Minimizing the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.

The revised collection of information associated with this rulemaking contained in 38 CFR 14.629 is described immediately following this paragraph, under its respective title.

Title: Application for Accreditation as a Claims Agent or Attorney, Filing of Representatives' Fee Agreements and Motions for Review of Such Fee Agreements.

OMB Control No: 2900-0605.

CFR Provision: 38 CFR 14.629.

• Summary of collection of information:

(1) Applicants seeking accreditation as claims agents or attorneys to represent benefits claimants before VA must file VA Form 21a with OGC. The information requested in VA Form 21a includes basic identifying information, as well as certain information concerning training and experience, military service, and employment. Along with the VA Form 21a, applicants for accreditation must also file a certification that they have completed a CLE requirement. See38 U.S.C. 5901; 38 CFR 14.629(b).

(2) If accredited agents and attorneys wish to maintain accreditation, they must file recertifications with OGC that they have completed CLE requirements and are in good standing with other courts, bars, and Federal and State agencies. See38 U.S.C. 5904(a)(2)-(3); 38 CFR 14.629(b).

(3) Accredited agents and attorneys must file with VA any agreement for the payment of fees charged for representing claimants before VA. 38 U.S.C. 5904(c)(2); 38 CFR 14.636(g).

(4) Claimants, accredited agents, or accredited attorneys may request an OGC determination on a reasonable fee allocation in a given case. If they do, OGC will solicit (optional) responses from the other parties in the case. 38 U.S.C. 5904(c)(3); 38 CFR 14.636(i).

• Description of need for information and proposed use of information:

(1) The information in the VA Form 21a and the initial CLE certification are used by OGC to determine the applicant's eligibility for accreditation as a claims agent or attorney. More specifically, it is used to evaluate qualifications, ensure against conflicts of interest, and to establish that statutory and regulatory eligibility requirements, e.g., good character and reputation, are met.

(2) The information in recertifications is used by OGC to monitor whether accredited attorneys and agents continue to have appropriate character and reputation and whether they remain fit to prepare, present, and prosecute VA benefit claims.

(3) The information in a fee agreement is used by the Veterans Benefits Administration (VBA) to associate the fee agreement with the claimant's claims file, to potentially determine the attorney or agent's fee eligibility, and to potentially process direct payment of a fee from the claimant's past-due benefits. It is used by OGC to monitor whether the agreement is in compliance with laws governing paid representation, and to potentially review fee reasonableness.

(4) The information in a request for OGC fee review, or a response to such request, is used by OGC to determine the agents' or attorneys' contribution to and responsibility for the ultimate outcome of the claimant's claim, so that a determination on reasonable fees can be rendered.

• Description of likely respondents: Claimants, Attorneys, Agents.
• Estimated number of respondents: 34,695.

(1) For VA Form 21a applications, 2,280.

(2) For recertifications, 4,860.

(3) For fee agreements, 27,250 (750 first time filers and 26,500 repeat filers).

(4) For requests for OGC fee review, 305.

Total estimated number of respondents (2,280, 4,860, 27,250, 305 = 34,695).

• Estimated frequency of responses: One time.
• Estimated Completion Time: Varies as specified below

(1) For VA Form 21a applications, 45 minutes.

(2) For recertifications, 10 minutes.

(3) For fee agreements, 1 hour for first time filers and 10 minutes for repeat filers.

(4) For requests for OGC fee review, 2 hours.

• Total Annual Burden Hours: 8,297 hours.

(1) For VA Form 21a applications, 1,710 hours.

(2) For recertifications, 810 hours.

(3) For fee agreements, 5,167 hours (750 hours for first time filers and 4,417 hours for repeat filers).

(4) For requests for OGC fee review, 610 hours.

Total estimated annual burden (1,710 hours, 810, hours, 5,167 hours, 610 hours = 8,297 hours).

• Estimated cost to respondents per year: $633,349.

(1) For VA Form 21a applications, $79,845 ($41,360 + $22,666 + $15,819).