Delaney, Trott Introduce Bipartisan Legislation to Protect Veterans’ Finances

Nov 15, 2018
Press Release

WASHINGTON – Today, Rep. John K. Delaney (MD-06) and Rep. Dave Trott (MI-11) introduced the Veteran Debt Fairness Act of 2018. This bipartisan legislation aims to protect veterans’ financial stability from being harmed by accounting and processing errors made by the Department of Veterans Affairs (VA) in the disbursement of earned monthly benefits. The bill would prevent the collection of overpayment debt that originated from errors at the VA, and in all other cases, would cap the amount the VA can deduct from a veteran’s monthly payment for recoupment of debt.


Senator Jon Tester (D-MT), Ranking Member of the Senate Committee on Veterans’ Affairs, introduced similar legislation earlier this year.


The VA is responsible for distributing monthly earned benefits to veterans and their beneficiaries. Currently, when the VA makes an overpayment in error to a veteran, the VA can then withhold some or all of a veteran's benefit, without limitation, including monthly disability payments. For veterans who live on a fixed income, withholding a benefit payment due to no fault of their own can present an undue hardship in their ability to pay rent or buy groceries.


“Our veterans have sacrificed enough for our nation,” said Congressman Delaney. “The least we can do is ensure they don’t have their financial wellbeing threatened by other people’s errors. This is just one small way we can show our appreciation for their service and provide some certainty in their financial planning.”


“Too many veterans have suffered financial hardships due to VA’s unclear or inaccurate collection of overpayments. The VFW thanks Congressman Delaney for introducing the Veteran Debt Fairness Act, which would fix how VA manages overpayments and improve the due process afforded to veterans with respect to recovery of overpayments,” said VFW National Legislative Service Director Carlos Fuentes. 


"The American Legion is happy to see legislation that offers protections to veterans and their families who have incurred VA-related debt through no fault of their own.  The American Legion works with the VA Debt Management office to assist veterans experiencing financial hardship, and believes this legislation will further show our nation's gratitude to our veterans by assisting them with collection issues related to the VA,” said Brett P. Reistad, National Commander of The American Legion.


In 2016, almost 238,000 veterans received overpayments. Overpayments can occur due to a variety of reasons, but a common occurrence is that the VA does not process veteran correspondence in a timely manner. In 2014, the Baltimore VA Regional Office improperly handled over 8,000 documents and the Office of Inspector General report stated the documents contained unprocessed “claims-related mail with the potential to affect benefits payments.”


While the VA has taken steps to reduce overpayments and address the issue at the source, veterans are still on the hook for errors that are not their fault. In addition, since payments are automatic and monthly, overpayments may not be identified right away, causing the debt to accumulate over time, creating an even greater hardship.


Additional measures in the Veteran Debt Fairness Act require the VA to:


  • Conduct a secondary review when the overpayment total is above $2,500 and creates an administrative 120-day process through which veterans can dispute debt;


  • Conduct audits to determine the frequency of VA errors resulting in overpayments and how that is affected by vacancies at the Veterans Benefits Administration (VBA); and


  • Provide veterans with a way to update dependency information on their own, eliminating a common delay that can affect a veteran’s benefits.