Notice2025-18155
Instruction of the Secretary and General Policy Statement on Processing Claims Under Section 252 of the Joseph Maxwell Cleland and Robert Joseph Dole Memorial Veterans Benefits and Health Care Improvement Act of 2022
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 19, 2025
Issuing agencies
Veterans Affairs Department
Abstract
The Department of Veterans Affairs (VA) announces that on December 22, 2023, the Secretary of Veterans Affairs issued a Temporary Timeliness Instruction to provide temporary timeliness standards for the processing of benefits claims-related information in implementing section 252 of the Joseph Maxwell Cleland and Robert Joseph Dole Memorial Veterans Benefits and Health Care Improvement Act of 2022 (Cleland-Dole Act), which prohibits the incurrence of VA beneficiary debt caused by overpayment attributable to VA's failure to timely process information provided by or on behalf of a VA beneficiary.
Full Text
<html>
<head>
<title>Federal Register, Volume 90 Issue 180 (Friday, September 19, 2025)</title>
</head>
<body><pre>
[Federal Register Volume 90, Number 180 (Friday, September 19, 2025)]
[Notices]
[Pages 45310-45312]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-18155]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF VETERANS AFFAIRS
[Docket No. VA-2025-VACO-0002]
Instruction of the Secretary and General Policy Statement on
Processing Claims Under Section 252 of the Joseph Maxwell Cleland and
Robert Joseph Dole Memorial Veterans Benefits and Health Care
Improvement Act of 2022
AGENCY: Department of Veterans Affairs.
ACTION: Notice.
-----------------------------------------------------------------------
SUMMARY: The Department of Veterans Affairs (VA) announces that on
December 22, 2023, the Secretary of Veterans Affairs issued a Temporary
Timeliness Instruction to provide temporary timeliness standards for
the processing of benefits claims-related information in implementing
section 252 of the Joseph Maxwell Cleland and Robert Joseph Dole
Memorial Veterans Benefits and Health Care Improvement Act of 2022
(Cleland-Dole Act), which prohibits the incurrence of VA beneficiary
debt caused by overpayment attributable to VA's failure to timely
process information provided by or on behalf of a VA beneficiary.
FOR FURTHER INFORMATION CONTACT: Michael May, Regulations Analyst,
Compensation Service, Veterans Benefits Administration, 202-461-9700.
SUPPLEMENTARY INFORMATION:
I. General
Notice is given that on December 22, 2023, the Secretary of
Veterans Affairs issued a Temporary Timeliness Instruction relating to
the implementation of 38 U.S.C. 5302B, as established by the Cleland-
Dole Act. Relevant excerpts from the Temporary Timeliness Instruction,
with slight modifications for reading clarity, are provided below. A
copy of the Temporary Timeliness Instruction, in its entirety, can be
found as an attachment to this notice at <a href="http://www.regulations.gov">www.regulations.gov</a> under
docket VA-2025-VACO-0002.
On December 29, 2022, Pub. L. 117-328, the Consolidated
Appropriations Act, 2023, was signed into law. This law contains
Division U, or the Cleland-Dole Act. Section 252 of Division U, title
II, subtitle E, or the VA Beneficiary Debt Collection Improvement Act
of 2022, added 38 U.S.C. 5302B, which prohibits the incurrence of VA
beneficiary debt resulting from overpayment due to a delay by VA in
processing beyond the applicable timeliness standard established by the
Secretary.
VA was previously required to collect debts from beneficiaries
regardless of VA information processing delays. In response to the fact
that processing delays negatively impact VA beneficiaries, Congress
enacted 38 U.S.C. 5302B, which establishes a prohibition against the
creation of a debt arising from benefit overpayment(s) attributable to
VA processing delays. This prohibition ensures that beneficiaries are
not held responsible for benefit overpayment debts that accrue due to
VA's failure to timely process information provided by or on behalf of
a beneficiary. It also incentivizes both the timely processing of
benefit claims information to avoid benefit overpayments and the timely
establishment and collection of benefit overpayment debts to avoid
unnecessarily large debt balances. Section 252 of the Cleland-Dole Act
notes that the Secretary shall prescribe regulations to establish
standards under section 5302B. VA is currently drafting those
implementing regulations. Due to the time required to develop and
promulgate the regulations, on December 22, 2023, the Secretary issued
a Temporary Timeliness Instruction establishing temporary timeliness
standards for processing benefit claims-related information provided by
or on behalf of a beneficiary. This instruction is temporary in nature
and will cease to be effective when VA publishes permanent timeliness
standard regulations under 38 U.S.C. 5302B(a)(1)(B). VA is also
implementing this instruction in a Veterans Benefits Administration
(VBA) letter to claims processors so that VA may begin processing
claims under section 5302B pending VA issuance of implementing
regulations. The VBA letter provided to claims processors is found as
an
[[Page 45311]]
attachment to this notice at <a href="http://www.regulations.gov">www.regulations.gov</a> under docket VA-2025-
VACO-0002.
II. Relevant Excerpts From the Temporary Timeliness Instruction of the
Secretary, With Slight Modifications for Reading Clarity
Background
Prior to the enactment of 38 U.S.C. 5302B, VA was required to
collect beneficiary debt attributable to VA's failure to timely process
information provided by or on behalf of a beneficiary, irrespective of
VA information processing delays. Recognizing that debt collection
activities (as defined herein), which commence after prolonged,
unexplained, or unjustified processing delays negatively impact VA
beneficiaries and are inconsistent with the fundamental principles of
fairness, VA employees must ensure that beneficiary overpayment debts
are identified, created, and collected in a timely manner. VBA is
issuing instructions to provide temporary timeliness standards for
overpayment debts attributable to VA's failure to timely process
information provided by or on behalf of a beneficiary, as required by
38 U.S.C. 5302B, pending VA issuance of implementing regulations.
In some cases, VA beneficiaries incur overpayment debt that is
attributable to VA's failure to timely process information provided by
or on behalf of a beneficiary. Often, beneficiaries are unable to repay
the debt without suffering undue hardship. While VA makes every effort
to work with beneficiaries to minimize the negative impact of debt
collection activities, prolonged delays by VA in commencing debt
collection activities exacerbate the negative impact to beneficiaries.
In part to address these inequities, on December 29, 2022, Congress
enacted the Cleland-Dole Act, which includes section 252, which amends
chapter 53 of title 38, United States Code, by inserting new 38 U.S.C.
5302B. Section 5302B provides:
Section 5302B. Prohibition of debt arising from overpayment due to
delay in processing.
(a) Limitation.--(1) Except as provided in paragraph (2), no
individual may incur a debt to the United States that--
(A) arises from the participation of the individual in a program or
benefit administered by the Under Secretary for Benefits; and
(B) is attributable to the failure of an employee or official of
the Department to process information provided by or on behalf of that
individual within applicable timeliness standards established by the
Secretary.
(2) Nothing in this section shall be construed to affect the penal
and forfeiture provisions for fiduciaries set forth inchapter 61of this
title.
(b)Notice.--(1) If the Secretary determines that the Secretary has
made an overpayment to an individual, the Secretary shall provide
notice to the individual of the overpayment.
(2) Notice under paragraph (1) shall include a detailed explanation
of the right of the individual--
(A) to dispute the overpayment, including a detailed explanation of
the process by which to dispute the overpayment; or
(B) to request a waiver of indebtedness.
Instructions
Debt collection activities that are attributable to a failure of an
employee or official of the Department to process information provided
by or on behalf of a beneficiary within the timeliness standards set
forth herein shall be limited.
Definitions for Purposes of These Instructions
a. Date of Decision Notification Letter: The date listed on the
Decision Notification Letter provided to the beneficiary.
b. Debt Collection Activities: The term ``debt collection
activities'' is intended to be construed broadly to include all
activities establishing and processing debts, communicating debt
notifications to beneficiaries, and recovering payments to satisfy the
debts.
c. Date of Claim: The date the claim or information is received by
VBA for claims establishment or benefit verification purposes, per VBA
Manual M21-4, B.1.c.
d. On Behalf of a Beneficiary: The term, ``on behalf of a
beneficiary,'' is defined as information provided by the beneficiary's
designated representative of record, or information that VA receives
through established matching agreements.
Timeliness Standards for Collecting Beneficiary Overpayments
When the underlying overpayment debt was attributable to a failure
of an employee or official of the Department to process in a timely
manner information provided by or on behalf of a beneficiary:
<bullet> Absent delays directly attributable to a beneficiary's
actions, VA must issue a Decision Notification Letter based on
information provided by or on behalf of a beneficiary within 1 year
from the date of claim. Delays attributable to a beneficiary's actions
will extend the timeliness period to issue a Decision Notification
Letter by the length of the delay.
<bullet> When VA fails to issue a timely Decision Notification
Letter, as noted above, VA will not create additional debt for
overpayments made more than 1 year from the date of claim.
<bullet> Each issue that generates a potential overpayment will be
considered separately for purposes of applying these timeliness
standards.
<bullet> VA will limit debt collection activities to overpayments
incurred:
1. During a 1-year period following the date of claim where a
Decision Notification Letter is issued within 1 year from the date of
claim;
2. That are directly attributable to beneficiary actions that
extend the timeliness period to issue a Decision Notification Letter;
and
3. As a result of the beneficiary's delay in reporting to VA
current and accurate information affecting their benefits.
Note: These timeliness standards do not apply in situations
where there is evidence of fraud, misrepresentation, or bad faith on
the part of the beneficiary or someone acting on behalf of the
beneficiary. These standards also do not relieve individuals, or
their designated representatives, of their responsibility to provide
current, accurate, and updated information affecting their benefits.
The standards may be used in consideration of challenges to the
validity of the debt or in processing requests for waivers,
compromises, repayment plans, or other forms of equitable relief
related to information provided by or on behalf of beneficiaries.
Delegated Discretionary Authority to the Under Secretary for Benefits
VA employees must ensure that VA's debt collection activities are
carried out in a timely, responsible, and fair manner. These
instructions, establishing temporary timeliness standards and
definitions, are intended to reduce the negative impact of untimely
debt collection activities. Therefore, recognizing the volume, scope,
and complexity of processing beneficiary benefits, the Secretary has
delegated discretionary authority to adjust the timeliness standards
set forth to the Under Secretary for Benefits to ensure that VA's
timeliness standards do not result in unfair or unjust outcomes.
In exercising this discretion, the Under Secretary for Benefits
shall consider whether the:
a. Timeliness standards will result in an undue hardship on the
beneficiary such that collection of the overpayment
[[Page 45312]]
would deprive the beneficiary of income required to provide for basic
necessities, including shelter, food, medicine, dependent care, or
other essential living expenses;
b. Timeliness standards will result in unjust enrichment of the
beneficiary; and
c. Cost of collection outweighs the potential for recovery.
Note: While the Under Secretary for Benefits must consider all
three of the foregoing factors, it is not necessary for every factor
to be satisfied or afforded equal consideration.
Application
In connection with a current matter involving delayed processing of
pending or nonfinal pension debt that resulted from a data quality
issue to identify Social Security income, VBA considered the three
factors above, and in so doing, found that the discretionary criteria
for non-collection of the debt are met. VBA recognizes that
beneficiaries receiving VA pension must meet specific eligibility
criteria, including but not limited to: income, net worth, age,
disability, and war-time service. This population of beneficiaries is
particularly vulnerable to suffering an undue hardship in repaying
pension overpayments. As such, VA has a heightened responsibility to
these beneficiaries. Accordingly, VBA recommends that VA program
offices be directed to take all necessary steps to not collect, and to
refund payments made on, pension debts that were incurred as a result
of VA delays in processing overpayments due to the data quality issue
with the Social Security matching program. Given the facts and
circumstances of the present issue, VBA finds that debt collection
activities would result in an undue hardship on the impacted
beneficiaries and be inconsistent with VA's mission.
Effective Date
These instructions apply to all debt collection activities pending
and nonfinal on June 27, 2023, as well as any original, supplemental,
or other debt collection activities on or after June 27, 2023. This
effective date is established based on the Congressional mandate for VA
to establish timeliness standards within 180 days of December 29, 2022,
the enactment date of the Cleland-Dole Act.
Miscellaneous
<bullet> These Instructions neither replace nor will be interpreted
inconsistently with existing laws, rules, or regulations.
<bullet> VA will ensure compliance with all reporting, oversight,
and compliance requirements. VA must act promptly and appropriately to
correct errors and resume debt collection activities in accordance with
applicable law, rule, regulation, and policy.
<bullet> These instructions are temporary in nature, are not
intended to bind VA regarding the terms of any subsequent regulations
and will cease to be effective when VA publishes timeliness standard
regulations, as directed by the Cleland-Dole Act.
Signing Authority
Douglas A. Collins, Secretary of Veterans Affairs, approved this
document on June 30, 2025, and authorized the undersigned to sign and
submit the document to the Office of the Federal Register for
publication electronically as an official document of the Department of
Veterans Affairs.
Taylor N. Mattson,
Alternate Federal Register Liaison Officer, Department of Veterans
Affairs.
[FR Doc. 2025-18155 Filed 9-18-25; 8:45 am]
BILLING CODE 8320-01-P
</pre></body>
</html>Indexed from Federal Register on September 19, 2025.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.