As PTSD cases rise and rules for claims ease, VA warned that more frauds will slip through

In tide of new PTSD cases, fear of growing fraud

Moved by a huge tide of troops returning from Iraq and Afghanistan with post-traumatic stress, Congress has pressured the Department of Veterans Affairs to settle their disability claims — quickly, humanely, and mostly in the vets’ favor.

The problem: The system is dysfunctional, an open invitation to fraud. And the VA has proposed changes that could make deception even easier.

PTSD’s real but invisible scars can mark clerks and cooks just as easily as they can infantrymen fighting a faceless enemy in these wars without front lines. The VA is seeking to ease the burden of proof to ensure that their claims are processed swiftly.

But at the same time, some undeserving vets have learned how to game the system, profitably working the levers of sympathy for the wounded and obligation to the troops, and exploiting the sheer difficulty of nailing a surefire diagnosis of a condition that is notoriously hard to define.

“The threshold has been lowered. The question is how many people will take advantage of that,” said Dr. Dan G. Blazer, a Duke University psychiatrist who has worked with the military on PTSD issues. PTSD, he adds, is “among the easiest (psychiatric) conditions to feign.”

Mark Rogers, a longtime claims specialist with the Veterans Benefits Administration, agrees. “I could get 100 percent disability compensation for PTSD for any (honorably discharged) veteran who’s willing to lie,” said Rogers, a Vietnam-era vet who is now retired. “I just tell him what to say and where to go.”

Some claims are built on a foundation of fake documents; in other cases, the right medals — plus a gift for storytelling — secure unearned benefits. Consider:

—Gulf War veteran Felton Lamar Gray told a VA psychologist he was spattered with “blood and chunks of head” when his “best friend” was shot in the face in Iraq. But only after the VA rated Gray 100 percent disabled did anyone check into his stories — and discover the comrade he spoke of is very much alive and said he barely knew Gray.

—Thomas James Barnhart is a Coast Guard veteran who used forged documents to convince VA doctors he was an elite, much-decorated Navy SEAL. Barnhart’s tales of daring rescues and of cradling a dying helicopter pilot in his arms won a congressman to his cause and helped him get a 30 percent PTSD disability rating from the VA, before he was outed by a watchdog group.

—Vietnam-era veteran Keith Roberts of Gillett, Wis., said he was traumatized when he was prevented from rescuing a friend being crushed under a Navy airplane, and was eventually granted 100 percent disability. But when the case was reopened, investigators could find no evidence that Roberts was even present when the accident occurred.

Each of these cases represents potentially millions of dollars in tax-free benefits over the veteran’s lifetime — benefits that may continue while the veteran works and even into retirement.

“There’s pressure from the public to sympathize with veterans and treat them with respect,” said Assistant U.S. Attorney Craig J. Jacobsen in Roanoke, Va., who prosecuted Barnhart and has handled other such “stolen valor” cases. “And you don’t want to go questioning their stories unless you have a very good reason to do so. … So I think it’s hard to sift out the phonies from that.”

PTSD is an undeniably real sickness whose symptoms — flashbacks, vivid nightmares, intrusive thoughts, exaggerated startle response, emotional numbness — can be debilitating. As of Fiscal Year 2009, nearly 390,000 veterans were receiving benefits for PTSD, making it the fourth-most prevalent service-connected disability, according to the VA.

Authorities have tried to brace the public for a tidal wave of psychically damaged veterans from the current wars. Of the roughly 1.6 million troops who have served in the war zones of Afghanistan and Iraq, more than 134,000 had been seen at VA health care facilities for “potential PTSD” as of late last year, according to a government report. Researchers suggest the numbers of actual sufferers are much higher.

A much-cited telephone survey published in 2008 by the Rand Corp. suggested that 300,000 veterans of the current wars were suffering from PTSD or major depression. A more recent study by researchers at the Naval Postgraduate School and Stanford University estimates that the PTSD rate among Iraq War veterans will be about 35 percent.

In its latest budget request, the VA estimates it will receive more than 1.3 million disability claims in 2011 — a 30 percent increase over last year. New claims continue to pour in from veterans of Vietnam, Korea and even World War II.

Veterans groups have sued the VA, complaining that claims take months and even years to be approved, and that some veterans had committed suicide as a result.

Last year, U.S. Rep. John J. Hall, D-N.Y., introduced legislation to streamline the VA claims process, especially for veterans in traditionally noncombat roles. Arguing that the system failed to recognize the changing face of war, Hall said the claims process had become an obstacle to healing, “inflicting upon the most noble of our citizens a process that feels accusatory and doubtful of their service.”

VA Secretary Eric K. Shinseki responded last summer with a proposed rule change. Until now, the agency has required independent proof that a traumatizing event — or “stressor” — occurred. Under the proposed changes, a veteran’s “lay testimony” about what happened to him would suffice, as long as it “is related to the veteran’s fear of hostile military or terrorist activity” and is “consistent with the places, types, and circumstances of the veteran’s service.”

Already, VA officials are legally bound to resolve “any reasonable doubt” in the veteran’s favor. And Rogers, the retired claims specialist, and others say the system is vulnerable to fraud because of the way it was designed: Doctors make diagnoses without fact-checking the veteran’s story, and once that diagnosis is made, claims raters’ hands are essentially tied.

No one knows the full extent of PTSD fraud; there is little political will to pursue a systematic investigation. But there have been some hints.

In 2005, a VA Inspector General’s review of 2,100 PTSD cases found that a quarter lacked proper documentation of a stressor; if the sample was representative of all PTSD claims, questionable compensation payments would have totaled $860 million that year. Then-VA Secretary Jim Nicholson announced that the review would be expanded to cover 72,000 cases where veterans had received a 100 percent disability rating for PTSD.

But when a veteran from New Mexico was found shot to death, his Purple Heart and a letter about the VA review by his side, a group of senators drafted an amendment to halt the review, which was termed “wrong-headed, costly and unnecessary” by one senator.

The critic? Barack Obama.

A 1990 law allows the Veterans Benefits Administration to crosscheck its rosters with federal tax and Social Security databases to find “unemployable” veterans reporting work-related income. In 2004, this program identified 8,846 such veterans who reported at least $6,000 in earnings, including 289 with income of $50,000 or more.

VBA management referred these cases for review to see if benefits should be revoked or reduced, but the inspector general found the agency “lax in tracking the results.”

The best way to catch phonies is on the front end, but that’s not how VA operates, said Jim Gaughran, a former VA program director for benefits fraud.

“They never get in trouble for paying; they only get in trouble for not paying,” said Gaughran, now a deputy assistant inspector general for the Department of Homeland Security. “They’d rather pay and chase.”

Most frauds are uncovered by investigators outside of the VA, observers say.

Barnhart — the Coast Guardsman who masqueraded as a Navy SEAL — was exposed by Chuck and Mary Schantag of the P.O.W. Network, which has outed thousands of phony heroes.

The closest Barnhart got to the jungles of Vietnam was a stint on a Navy warship off the coast in 1969 and 1970, Jacobsen told a judge during a hearing in January. But when he switched to the Coast Guard, Jacobsen said, Barnhart would “spin yarns about his secret missions with the Navy SEALs” and even claimed to have been nominated for the Medal of Honor.

“The defendant further admitted that he had lied about his medals and death experiences during his medical exam in the hopes that it would increase his chances to get disability for PTSD,” Jacobsen testified. Barnhart was granted a 30 percent disability rating for PTSD and collected $13,923 before he was caught.

Barnhart pleaded guilty Jan. 6 in U.S. District Court in Roanoke, Va., to two counts of violating the Stolen Valor Act. On April 8, Judge James C. Turk sentenced him to 12 months and a day in prison and two years of supervised release, and ordered him to pay $11,098 in restitution.

He hung up on an AP reporter seeking comment.

In the case of Felton Gray, the Gulf War veteran told a psychologist at the VA medical center in Portland, Ore., that he’d put “hundreds of Iraqi soldiers in bags,” and that his best friend was hit in the face with a bullet during a mission to clear an enemy trench, spraying Gray with gore. As a result, he said, he could not sleep at night and found it difficult to leave his apartment.

“This man has suffered severe enough traumas to qualify for a diagnosis of post traumatic stress disorder and in fact has serious symptoms,” Dr. Ruth Parvin wrote in her evaluation. With other, physical problems, that finding earned Gray a designation of “individual unemployability” — and 100 percent compensation.

Trouble is, none of what Gray told the doctor happened.

When initially examined by the VA in June 1993, Gray “did not report any stressors in the military relating to combat,” his records show. He was later granted service connection for migraine headaches, a shoulder injury and bunions, for a total disability rating of 50 percent.

Gray filed for PTSD in 1996, and was granted service-connected disability two years later.

Normally, such records are closed to the public, unless the veteran signs a waiver. But AP obtained nearly 1,500 pages from Gray’s VA claims file because they were part of a criminal investigation.

Gray was charged with murder in the Aug. 4, 1998, shooting of former NFL linebacker Marquise Leslie Thomas. Gray claimed that the larger Thomas had forced himself into his Beaverton, Ore., apartment, and that he had fired in self-defense. He was eventually convicted of first-degree manslaughter and sentenced to 10 years in prison.

Gray’s attorney initially planned to mount a PTSD defense. When Beaverton police checked out Gray’s war stories, they fell apart, police and court records show.

Although his “best friend,” Ronald Rowe, did have an M-16 explode in his face during a training exercise in a mock-up of an Iraqi entrenchment, he only had “a little scratch on my face and ringing in my ears” and didn’t require medical attention, he told the AP recently from his home in Madison, Tenn.

As for handling dead Iraqis, Rowe said: “Everybody we captured was alive. There wasn’t no body bags.”

When the Board of Veterans Appeals granted Gray a 70 percent rating for PTSD, the panel acknowledged that it did so without verifying his stressors or even his dates of service. The board accepted Gray’s Combat Infantryman Badge “as sufficient evidence of in-service stressors relating to combat and reasonable doubt has been ruled in favor of the veteran.”

The AP recently contacted Gray, 42, at his home in Tigard, Ore. “There was no fake,” Gray said. He declined to open his updated VA file but insisted that his disabilities have been “validated.” The VA would say only that Gray is currently drawing $2,882 a month — 100 percent disability.

“All of that is a part of the past, and I choose to move forward,” Gray said.

Some critics complain that a lack of personnel — clinicians to do the evaluations and ratings specialists to handle the claims — slows down the claims process. But that same shortage makes it more difficult for examiners to make accurate diagnoses and catch frauds.

Gray “fooled me. It’s easy,” said Dr. Landy F. Sparr.

Sparr — former acting chief of psychiatry at the Portland VA Medical Center — conducted a forensic examination of Gray and confirmed the PTSD diagnosis. He said the three hours recommended by the VA for a compensation and pension exam are hardly sufficient to form an opinion.

“If you wanted to do a proper evaluation, it would take you hours and hours — I’m talking at least five, six hours — to review the records and do everything,” said Sparr, now an associate professor at Oregon Health & Science University. Given rates of $500 per exam for contractors, Sparr said, “It’s just not going to happen.”

Rogers, the claims specialist, said the clinicians don’t feel it’s their job to verify a veteran’s stories.

Duke’s Blazer adds: “Checking behind a patient actually breaks the confidentiality of the doctor/patient relationship, putting (it) into a position of adversarial rather than cooperative.”

But claims raters are basing their decisions on diagnoses from psychiatrists and other mental health professionals. Once a diagnosis of PTSD is given, the rater is “prohibited from cross-examining the veteran,” said Rogers, who worked at the VBA for nearly 30 years.

VBA workers say they are under enormous pressure to push claims through. Richard Allen, a Vietnam-era veteran who worked in the VBA’s Wichita, Kan., office, remembers a sign on the wall there: “Pay if you can, deny if you must.”

He recalls one manager telling him, “‘You don’t get it. Your job is to pay.’ Myself and others thought it was our job to take care of veterans and, when they’re entitled, to pay them everything they’re entitled to. But when they’re not entitled, someone has to say, ‘No.’”

But generally, they say yes.

Robert Warren, 45, of Sullivan, Ill., played the SEAL role to the hilt, right down to the signature trident tattooed on his left calf. He told harrowing stories of action in Somalia and Lebanon, low-altitude parachute jumps and of being a prisoner of war — stories so convincing that when he applied for PTSD benefits in February 2002, Vietnam War Medal of Honor recipient Allen J. Lynch agreed to personally shepherd the claim.

But in his application to the VA, Warren — who was in the Navy from 1984 to 1988 and never rose above the rank of petty officer third class — cited as the event that ruined his life a November 1984 accident aboard the submarine tender USS Hunley that left two sailors badly burned. Warren told the VA he hadn’t held a job in five years, and that his condition had made it impossible for him to work around people.

In November 2003, the VA granted 80 percent disability for PTSD and a knee injury, making him eligible for 100 percent compensation and “unemployability.” Six months later, the Social Security Administration determined that Warren “suffered from significant and severe mental impairment,” making him eligible for simultaneous benefits from that agency.

This continued until late 2008, when investigators at both agencies became suspicious.

Prosecutors found that while Warren was on board the Hunley when the accident occurred, he did not witness it. And his disabilities were as phony as his stories, they say.

As a member of the Sullivan Volunteer Fire Department, Warren had accumulated more than 400 hours on hundreds of emergency calls, and had completed 70 hours of training. And the man who supposedly couldn’t work around people was manager of the Dragon Inn, a Sullivan tavern he’d bought in 2000.

By the time Warren’s benefits were halted in October 2008, he had received $166,116 from the VA — including money for his son’s college — and $114,045 in Social Security disability payments.

On Jan. 6, Warren pleaded guilty in U.S. District Court to six counts of wire fraud, four counts of mail fraud, one count of making false statements and one count of Social Security fraud. Under a plea agreement, he faces between 21 and 27 months in prison and must repay all the money he received.

In a telephone interview with the AP, Warren maintained that he did see the accident — through a catwalk, from below.

“Skin was just dripping off,” he said, his voice almost a monotone. “It just had this horrible, horrible, horrible smell of burning flesh that I can’t get out of my system.”

Warren said the SEAL ruse began as a barroom ploy “to pick up girls,” and acknowledges that it has destroyed his credibility. But he insists that his work at the fire department and bar have been blown out of proportion, that his ailments are very real, and that he only pleaded guilty on the advice of his public defender.

A veterans group “filed the paperwork for me on this claim. And I just sat back and kept doing my thing, living my life, going to these doctors, doing whatever I had to do,” he said.

Ricky Bell, whose face was severely burned in the Hunley accident, told the AP there is no way Warren or anyone else could have seen the explosion, and that Warren’s story got key details wrong. The Atlanta man still gets “jumpy” lighting a brazing torch and has lost numerous air conditioning/refrigeration jobs because of his “frights about fire,” yet his four applications for PTSD benefits have been denied.

“I was IN the accident and can’t get it,” says Bell, 46, his voice rising. “Does that sound like the American way?”

But these cases can be difficult to sort out, as the case of Vietnam-era veteran Keith Roberts illustrates.

Roberts was stationed at the U.S. Naval Air Facility in Naples, Italy, in February 1969 when Airman Gary Holland was crushed to death in the wheel well of a C-54 Skymaster transport plane. Roberts, then a 20-year-old aircraft lineman, said he tried to rescue his “very good friend” by having a forklift raise the craft’s nose, but that superiors nixed the plan to avoid damaging the plane.

Starting in 1987, Roberts filed a string of disability claims with the VA, eventually blaming PTSD for everything from smoking addiction to arthritis. In 1999, Roberts was declared 100 percent disabled and got a lump sum payment, retroactive to August 1993.

But investigators later determined that Roberts didn’t even participate in the rescue effort and was not as close to Holland as he’d claimed. The Board of Veterans Appeals concluded that Roberts “elevated the rather mundane facts … into what appeared on the surface to be a bona fide PTSD stressor (his best friend died in his arms).”

The board said the VA’s regional office “simply conceded” Roberts’ claims “without obtaining credible supporting evidence.” After losing his benefits, Roberts was convicted of wire fraud, sentenced to 48 months in prison and ordered to pay $262,943.52 in restitution.

Last month, the U.S. Court of Appeals for Veterans Claims concluded in a 45-page ruling that Roberts “committed fraud in securing VA benefits for his PTSD” and affirmed the BVA’s decision to sever them.

In a recent telephone interview, the 62-year-old veteran denied that he lied, but argued that under VA rules, he could have PTSD from merely being “vicariously aware of the situation.”

“I could have been downtown Naples (having sex) and I STILL could have PTSD. It’s the way you perceive it,” Roberts said from the Federal Correctional Institution near Denver, before his release in March.

And these are the standards that VA officials would loosen by taking at face value veterans’ testimony that they had endured a traumatizing event.

But even then, Gulf War veteran Paul Sullivan argues that the threshold for PTSD claims would still be too high.

“In our view, someone who’s deployed to a war zone should be presumed to have a stressor,” Sullivan, executive director of Veterans for Common Sense, told participants in a Washington round-table discussion.

When asked whether the new rule would throw open the doors to more fraud, Shinseki stressed the need for more research into PTSD and traumatic brain injury, the war on terror’s other “signature” wound.

“I know if we take your temperature and you’re registering at 102 degrees, you’ve got a fever, and there are ways to cope with that,” the VA secretary told the AP. “PTSD and TBI are in need of the same kind of metrics.”

But in the meantime, his agency is stuck in a morass that seems to have no solution, typified by the case of one Vietnam veteran from Kentucky.

Over the course of more than a decade of denials and appeals, examiners had caught the man in repeated lies. The worst was a tale of trauma related to the 1968 Tet Offensive — which occurred more than a year before he arrived in-country.

Yet the Board of Veterans Appeals voted to grant the man service connection for PTSD, making him eligible for disability benefits. In making the grant, the panel basically acknowledged that the claims system was overwhelmed, and that the veteran had simply worn them down.

“In so holding,” the panel wrote, “the Board … observes that to remand once again would be an ill-advised use of VA resources at a time when veterans returning from Iraq and Afghanistan with confirmed PTSD are in need of treatment.”

AP Writer Kimberly Hefling in Washington, D.C., also contributed to this report. Allen G. Breed, a national writer for The Associated Press based in Raleigh, N.C., can be reached at features(at)ap.org.