Veterans Benefits: An Overview

Veterans Benefits: An Overview

Order Code RS22902
June 25, 2008
Veterans Benefits: An Overview
Carol D. Davis
Knowledge Services Group
Sidath Viranga Panangala and Christine Scott
Domestic Social Policy Division
Summary
The Department of Veterans Affairs (VA) offers a wide range of benefits and
services to eligible veterans, members of their families, and survivors of deceased
veterans. VA programs include disability compensation and pensions, readjustment
benefits, and health care programs. The VA also provides life insurance, burial benefits,
housing and other loan guaranty programs, and special counseling and outreach
programs. While eligibility for specific benefits varies, veterans generally must meet
requirements related to discharge type and length of active duty military service. This
report provides an overview of major VA benefits and the VA budget. It will be
updated as events warrant.
Introduction
The provision of various post-service benefits to military veterans dates back to the
period before the Revolutionary War. Since 1789, Congress has expanded the range of
benefits available to veterans through the passage of a multitude of laws. This report
highlights the major benefits offered by the Department of Veterans Affairs (VA) and
provides further references where appropriate. It concludes with a summary of the VA
budget authority and the number of beneficiaries from FY1980 through FY2007.
Veterans Benefits
Disability Benefit Programs. Disability compensation is paid to veterans who
have disabilities from injuries and illnesses that were incurred during, or aggravated by,
active duty military service.1 The individual monthly disability compensation payment
is determined by the veteran’s disability rating, whether the veteran has a spouse or other
1 For more information on eligibility for disability benefit programs for veterans, see CRS Report
RL33113, Veterans Affairs: Basic Eligibility for Disability Benefit Programs, and CRS Report
RL33323, Veterans Affairs: Benefits for Service-Connected Disabilities, both by Douglas Reid
Weimer.

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dependents, and whether the veteran has a disability entitling him or her to special
monthly compensation (SMC) because of the loss, or loss of the use of, certain
extremities or organs as a result of active duty military service. Disability ratings
generally range from 10% to 100% in 10% intervals and are based on the presumed
average impact of the disability on employment or earnings capacity; however, some
disabilities are given a zero-percent rating.2 Disabled veterans may also be eligible for
vocational rehabilitation, grants for adaptive housing and automobiles, and a clothing
allowance. Dependency and indemnity compensation (DIC) is paid to the surviving
dependents of veterans who died as a result of service-connected causes; certain totally
(100%) disabled veterans who died as the result of nonservice-connected causes; and
servicemembers who died on active duty. In FY2007, about 2.8 million disabled veterans
and 333,000 survivors received $33.6 billion in compensation payments.3
Veterans’ Pensions. Veterans’ pensions4 are means-tested cash benefits that are
paid to veterans who served during a period of war and have become permanently and
totally disabled from nonservice-connected causes or are elderly (over age 65), and to the
survivors of such veterans. Veterans must also meet income or net worth criteria to be
eligible for VA pensions. Under the current pension program (also known as the
Improved Disability Pension program), benefits5 are based on family size, and the
pensions provide a floor of income. Almost all sources of income, including Social
Security benefits, are subtracted from the basic pension benefit. Although Supplemental
Security Income (SSI) payments are not subtracted from the basic VA pension benefit, all
veterans’ benefits (including pension benefits) are counted as income for the SSI program.
In FY2007, 325,378 veterans and 198,047 survivors received $3.7 billion in veterans’
pension payments.6
Readjustment Benefits. Several VA programs support readjustment, or
education, job training, and vocational rehabilitation, benefits for veterans and military
personnel who meet certain eligibility criteria. The largest of these programs is the
Montgomery GI Bill (MGIB). The MGIB provides educational assistance to persons
who, as members of the Armed Forces or the Selected Reserve, elected to participate in
the program since June 30, 1985. The purposes of the MGIB are to aid servicemembers
leaving the Armed Forces in their readjustment to civilian life, to provide an incentive for
the recruitment and retention of qualified personnel in the Armed Forces, and to develop
a more educated and productive workforce.
2 Links to current and historical monthly benefit rate tables for disability compensation can be
found on the VA Website at [http://www.vba.va.gov/bln/21/Rates/].
3 Department of Veterans Affairs, FY2009 Budget Submission, Benefits and Burial Programs and
Departmental Administration, Volume 3 of 4, p. 2A-3, available at [http://www.va.gov/budget/
summary/2009/Volume_3-Benefits_and_Burial_and_Dept_Admin.pdf].
4 For more information on veterans’ pensions, see CRS Report RS22804, Veterans’ Benefits:
Pension Benefit Programs, by Carol D. Davis and Christine Scott.
5 Links to current and historical monthly benefit rate tables for VA pensions can be found on the
VA Website at [http://www.vba.va.gov/bln/21/Rates/].
6 Department of Veterans Affairs, FY2009 Budget Submission, Benefits and Burial Programs and
Departmental Administration, Volume 3 of 4, p. 2A-3, available at [http://www.va.gov/budget/
summary/2009/Volume_3-Benefits_and_Burial_and_Dept_Admin.pdf].

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To participate in the MGIB, active duty military personnel contribute $100 per month
for the first 12 months of enlistment. Eligibility depends on the veteran having made the
required monthly contributions and having met a minimum length of active duty service
requirement, which is determined by the length of the service obligation. Benefit levels
are determined by the type of training sought (institutional, apprenticeship, or on-the-job)
and enrollment status (full-time or part-time). A servicemember earns one month in
MGIB benefits for each month of active duty service, up to a maximum of 36 months.7
In FY2007, spending for VA readjustment programs was $3.3 billion (Table 1). In
addition to the benefits and services provided by the VA, the Department of Labor
provides employment counseling and job training for veterans.8
Housing and Homeless Benefits. The VA provides housing benefits for
veterans, such as guaranteed and direct loan programs that enable veterans to purchase
homes.9 In FY2007, the VA guaranteed 129,261 loans at a cost of $24.2 billion and
provided 1,143 direct loans at a cost of $118.6 million.10
Several federal programs have been created to aid homeless veterans, whose numbers
were estimated at 154,000 in January 2007. In FY2007, the federal government spent
about $282 million for homeless veterans’ programs, covering such areas as health care,
employment services, and housing.11
Health Benefits. Veterans generally must enroll in the VA health care system to
receive inpatient and outpatient medical care. Eligibility for enrollment is based primarily
on previous military service, disability, and income. VA provides free inpatient and
outpatient medical care to veterans for service-connected conditions and to low-income
veterans for nonservice-connected conditions. For 2008, a veteran with an income of
$28,429 or less with no dependents, or $34,117 or less with one dependent (add $1,909
for each additional dependent), is eligible to receive free medical care. The FY2008
National Defense Authorization Act (P.L. 110-181) extended from two to five years the
eligibility period for enrollment for those veterans who served in a combat theater of
operations after November 11, 1998. Therefore, active duty, National Guard and Reserve
servicemembers returning from Operation Enduring Freedom and Operation Iraqi
Freedom (OEF/OIF) may, after their most recent discharge from active duty, enroll in the
VA health care system for free VA medical care for a period of five years for conditions
7 For more information on the Montgomery GI Bill (MGIB) program, see CRS Report RL33281,
Montgomery GI Bill Education Benefits: Analysis of College Prices and Federal Student Aid
Under the Higher Education Act, by Charmaine Mercer. Information on the MGIB monthly
benefit rates can be found at [https://www.gibill.va.gov/GI_Bill_Info/rates.htm].
8 For more information on veterans’ programs offered by the Department of Labor, see CRS
Report RS22666, Veterans Benefits: Federal Employment Assistance, by Christine Scott.
9 For information on the veterans’ guaranteed housing loan program, see CRS Report RS20533,
VA-Home Loan Guarantee Program: An Overview, by Bruce E. Foote and Meredith Peterson.
10 Department of Veterans Affairs, FY2009 Budget Submission, Benefits and Burial Programs
and Departmental Administration, Volume 3 of 4, p. 2E-14, available at [http://www.va.gov/
budget/summary/2009/Volume_3-Benefits_and_Burial_and_Dept_Admin.pdf].
11 For more information on homeless veterans’ programs, see CRS Report RL34024, Veterans
and Homelessness, by Libby Perl.

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that are, or may be, related to their combat service. Following this initial five-year period,
these veterans may continue their enrollment in the VA health care system, but they may
be subject to applicable copayments for nonservice-connected conditions.12
VA provides a comprehensive medical benefits package to all enrolled veterans.
Broadly, this includes preventive care services (e.g., immunizations, physical
examinations, health care assessments, and screening tests); inpatient and outpatient
medical care, surgery, and mental health care, including care for substance abuse;
prescription drugs, over-the-counter drugs, and medical and surgical supplies; and durable
medical equipment and prosthetic and orthotic devices, including eyeglasses and hearing
aids. VA provides this care through 155 medical centers, 135 nursing homes, 717
ambulatory care and community-based outpatient clinics (CBOCs), 45 residential
rehabilitation treatment programs, and 209 Vet Centers (generally these are community-
based, non-medical facilities that offer counseling services). Under certain circumstances,
VA also pays for care provided to veterans by independent providers and practitioners on
a fee basis. Eligible dependents of veterans receive inpatient and outpatient care in the
private sector under the Civilian Health and Medical Program of the Department of
Veterans Affairs (CHAMPVA).13 In addition, VA provides grants for the construction
of state-owned veterans’ nursing homes and domiciliary facilities and collaborates with
the Department of Defense (DOD) in sharing health care resources and services.
In general, VA provides nursing home care to veterans with service-connected
conditions that are clinically determined to require nursing home care and to veterans with
service-connected disabilities that are rated 70% or more. The department may also
provide VA nursing home care to other veterans if space and resources are available. In
FY2007, VA health care programs cost $36.2 billion (Table 1). VA medical services
were provided to about 5.1 million “unique patients,”14 resulting in about 811,000
inpatient episodes and 63 million outpatient visits (Table 2).
12 For more information on veterans’ medical care, see CRS Report RL33993, Veterans’ Health
Care Issues, by Sidath Viranga Panangala.
13 For more information on the CHAMPVA program, see CRS Report RS22483, Health Care for
Dependents and Survivors of Veterans, by Sidath Viranga Panangala and Susan Janeczko.
14 “Unique patients” include individuals other than veterans who are eligible for VA medical care.

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Table 1. Budget Authority For Veterans Benefits And Services,
Department of Veterans Affairs, FY1980-FY2007
(millions of dollars)
Compensation
Other Benefits,
Readjustment
Total Budget
Fiscal Year
and Pension
Services, and
Benefitsb
Health Carec
Authority
Benefitsa
Administrationd
1980 $11,202 $2,319 $6,007 $1,024 $20,552
1981 12,592 2,290 6,533
1,044 22,459
1982 13,824 1,939 7,302
1,161 24,225
1983 13,431 1,666 7,980
1,531 24,607
1984 14,127 1,453 8,529
1,525 25,634
1985 14,168 1,138 9,202
1,879 26,387
1986 14,427
878
9,363
1,563 26,230
1987 14,445
741
9,983
1,436 26,605
1988 14,832
808 10,345 2,257 28,242
1989 15,461
620 11,146 2,118 29,345
1990 15,555
498 11,696 2,029 29,778
1991 16,397 1,004 12,604 2,519 32,525
1992 16,342
635 13,908 2,272 33,158
1993 16,969
814 14,962 2,409 35,155
1994 17,526 1,051 15,974 2,229 36,780
1995 17,627 1,287 16,480 2,073 37,466
1996 18,432 1,345 16,863 1,995 38,635
1997 19,599 1,377 17,337 1,741 40,054
1998 20,483 1,366 18,056 1,782 41,687
1999 21,857 1,175 18,236 1,870 43,138
2000 21,568 1,469 19,871 1,911 44,819
2001 23,356 1,981 21,415 1,913 48,665
2002 26,044 2,135 23,028 2,288 53,495
2003 28,949 2,265 25,836 2,624 59,673
2004 29,845 2,530 28,824 2,626 63,825
2005 32,608 2,556 31,642 2,630 69,436
2006 33,898 3,309 31,511 5,019 73,737
2007 38,172 3,262 36,222 4,357 82,014
Source: Table prepared by the Congressional Research Service (CRS) based on data obtained from the
General Administration & Coordination Service, Office of the Budget, Department of Veterans Affairs.
a. Includes compensation and pensions for veterans and survivors, burial obligations, clothing allowances,
and other special compensation for children of certain categories of veterans.
b. Includes educational benefits for veterans, reservists, and dependents; vocational rehabilitation; tuition
assistance; grants to state approving agencies for MGIB benefits; and grants for adapted housing,
automobiles, and equipment.
c. Budget authority for the Veterans Health Administration. Aside from direct appropriations for medical
care, VA has been able to supplement its appropriations through Medical Care Collections Fund
(MCCF) collections. These include inpatient, outpatient, medication, and nursing home
copayments from veterans and third-party payments recovered from veterans’ insurers. Since
FY1998 (the first year VA started retaining these collections), VA has utilized these collections
to provide medical services to veterans. MCCF totals are included in budget authority figures from
FY1998 forward.
d. Includes insurance programs, housing and other loan guaranty programs, and administration. Beginning
in FY2006, this category also includes information technology, which was previously reported as
part of each program.

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Table 2. Number of Recipients of Veterans Benefits and Services,
FY1980-FY2007
(in thousands)
Readjustment,
Compensation
Medical Care
Housing Loan
Fiscal Year
Education, and
and Pensions
Programs
Job Training
Inpatienta
Outpatientb
1980 4,646
1,233 1,359
17,930 297
1981 4,535
1,081 1,360
17,809 188
1982 4,407
906
1,358
18,510 103
1983 4,286
755
1,401
18,616 245
1984 4,123
629
1,412
19,601 252
1985 4,005
492
1,435
20,188 179
1986 3,900
419
1,462
21,635 314
1987 3,850
365
1,466
21,635 479
1988 3,762
352
1,224
23,233 235
1989 3,686
349
1,153
22,629 190
1990 3,614
360
1,113
22,600 196
1991 3,546
322
1,072
23,007 181
1992 3,462
388
988
23,902 266
1993 3,397
438
974
24,236 383
1994 3,351
472
963
25,443 602
1995 3,332
476
930
27,565 263
1996 3,315
475
850
30,055 292
1997 3,290
480
700
32,648 239
1998 3,270
479
632
35,777 369
1999 3,254
458
752
37,799 396
2000 3,241
459
718
39,266 176
2001 3,220
485
729
43,808 253
2002 3,246
559
746
47,032 295
2003 3,328
554
742
50,756 522
2004 3,396
582
761
54,776 271
2005 3,476
591
811
58,236 162
2006 3,548
587
774
60,194 139
2007 3,646
610
811
62,936 130
Source: Table prepared by the Congressional Research Service (CRS) based on data obtained from the
General Administration & Coordination Service, Office of the Budget, Department of Veterans Affairs.
a. Patients treated is the sum of discharges and deaths during the reporting period plus patients remaining
as bed occupants or absent bed occupants at the end of the reporting period.
b. Visits for outpatient care.