Administration Doesn’t Budge On Budget

June 2, 2017 

Last week, MOAA reported on the administration's budget request, including a shocking proposal to terminate individual unemployability (IU) benefits for disabled veterans once they reach age 62 and become eligible for Social Security. 

When questioned about the administration's budget proposal this week, VA Secretary Dr. David Shulkin stood by the termination of IU benefits for this group of veterans, saying it was needed to pay for the expansion of the VA's Choice program, and that it was the “responsible” thing to do with taxpayer dollars. 

MOAA strongly disagrees.

MOAA's Director of Government Relations for Veterans Benefits Lt. Col. Aniela Szymanski, USMCR, explains, “The word 'unemployability' is only one word in the name of this benefit. The full title is 'total disability based on individual unemployability'. It is not, as some suggest, merely a form of unemployment insurance that should end when someone ages out of the work force. It is a total disability allowance. One doesn't suddenly stop suffering from a service-connected disability once they're old enough to retire.”

Administration officials believe this cohort of veterans should receive reduced disability compensation because they wouldn't be working past age 62, so they shouldn't be paid unemployability benefits.

However, IU benefits are paid to veterans too disabled to maintain “substantially gainful” employment. During their prime working years, these service-connected disabled veterans are unable to earn Social Security credits or build a nest egg for retirement through things like an employer-sponsored 401(k). 

Without those safety nets, the nation's most vulnerable veteran population is at risk of becoming impoverished and destitute.

“This is not living up to the promise that this country has made to its warriors,” says Szymanski. “How can we continue to ask the men and women of this country to raise their right hand in service to this nation during a time of war while simultaneously telling them that we are already planning to abandon them in the future?”

The arbitrary termination of IU based on age would also have devastating secondary effects. MOAA members have already expressed their outrage over what these proposed changes could mean for benefits such as: 

  • Dependency and Indemnity Compensation;
  • burial benefits;
  • Dependents' Educational Assistance (something surviving spouses often rely on to better their family circumstances);
  • dental coverage;
  • access to commissary and exchanges; and
  • state property tax exemptions.   

These second and third order effects must be taken into consideration when Congress takes up this issue. 

When VA officials were questioned about the IU change at the budget rollout briefing last week, they said they calculated the savings by merely adding up the amount the VA currently pays in IU benefits to veterans ages 62 and older. 

This calculation failed to account for veterans who are ineligible for Social Security retirement benefits (who would continue to receive IU benefits under the proposal) or the cost of other VA programs that these veterans may be forced into, like homelessness programs and pension benefits, because of the proposed cuts. 

The savings are likely to be much less than what the administration anticipated.

To say this proposal is shortsighted and not well grounded would be an understatement. 

A 2016 Government Accountability Office report recommended the VA study the potential for making this type of change to IU. The GAO report said the study is scheduled to conclude in September. 

The last available minutes from the VA Advisory Committee on Disability Compensation reflects, as of March, the VA still was collecting data from U.S. census records to study the effect of such changes. There is no indication the study has been completed. 

Szymanski says, “The results of this study must be published, provided to Congress and veterans service organizations, fully examined, and discussed before this drastic and draconian slash to benefits is implemented. The VA needs to be transparent.” 

MOAA needs your help in letting Congress know it should reject this proposal in its final budget. Send a message to your members of Congress.

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