They were the worst of projects. They became the best of projects.

Spanning almost two decades, the U.S. Department of Veterans Affairs (VA) pumped almost half a billion dollars into a pair of nearly still-born efforts: one to improve the processing of disability and pension claims filed by former military personnel, and another to share medical records electronically with the U.S. Department of Defense, which has servers that house information on injuries and illnesses soldiers suffer during their tours of duty.

Yet over the past three years, the VA has salvaged both projects.

Project managers halted requests for new claims-system features, ending a time sink they previously had been unable to stop. They dropped their attempt to send data to the Department of Defense (DoD), settling for a more-limited system where VA clinicians could access DoD medical and service histories. In both cases, these project managers began to insist on time-honored software-development practices—such as making sure exact system requirements are nailed down in a reasonable time so that software development isn't dragged out indefinitely.

The VA, which provides health and retirement benefits to retired military personnel, is now able to look online at combat and other medical records held on DoD computers, a practicality that replaces expensive and time-consuming paper requests and answers. Agency officials also have new applications that allow them to review a service record, determine a level of a disability, authorize payment and notify a veteran of a decision—all from their workstations.

This is almost radical stuff for a hidebound bureaucracy. Indeed, what the VA was trying to do, especially in the area of medical-data exchange, "was extremely ambitious,'' says Robert Kolodner, acting deputy chief information officer for health at the veterans' agency,

A lot of work remains. But Defense Department medical histories now can be accessed instantly from VA emergency rooms around the world. The number of claims stacked up waiting to be processed has been cut almost in half from a peak of 420,603 in September 2001.

"There is a better process in place," says Edward Reese, national service director at the Disabled American Veterans (DAV) organization. The DAV's 2.1 million members nationwide count on the VA to supply healthcare, vocational, rehabilitation and employment services, as well as disability payments.