Bush taps retired general to head Veterans Affairs

"He will be the first physician and the first general to serve as secretary," Bush said, standing next to Peake in the Roosevelt Room.

The nomination is being made as the administration and Congress struggle to find clear answers to some of the worst problems afflicting wounded warriors, such as receiving adequate mental health treatment and timely payment of disability benefits. Disclosures emerged in February of shoddy outpatient treatment at Walter Reed Army Medical Center.

Peake is chief medical director and chief operating officer of QTC Management Inc., which provides government-outsourced occupational health, injury, and disability examination services. If confirmed by the Senate, Peake would lead the government's second-largest agency, with 235,000 employees, in the waning months of the Bush administration.

In his new post, Peake, the son of a medical services officer and Army nurse, would manage the VA, which has been criticized for poor coordination in providing medical treatment and disability benefits to millions of veterans.

Earlier this year, a presidential commission chaired by former senator Bob Dole, Republican of Kansas, and Donna Shalala, former Health and Human Services secretary during the Clinton administration, proposed sweeping changes that could add to the VA's backlogged system by shifting most of the responsibility in awarding disability benefits from the Pentagon to the VA.

Veterans Affairs Secretary James Nicholson resigned in July, effective Oct. 1. Gordon Mansfield, the VA's deputy secretary, has been serving as acting secretary.

The VA's backlog is 400,000 to 600,000 claims, with delays of 177 days. Nicholson in May pledged to cut that time to 145 days, but he has made little headway with thousands of veterans from Iraq and Afghanistan returning home.

"There is a lot of work to be done as we move forward on implementing the Dole-Shalala commission recommendations," Peake said. "The disability system is largely a 1945 product, 1945 processes around a 1945 family unit. About everybody that has studied it recently said it is time to do some revisions."