VA CHIEF WITHDRAWS STAAB APPEAL, VOWS TO REPLACE ‘IU’ PAY CUT
VA Secretary David Shulkin made two surprise announcements Wednesday before the Senate Veterans Affairs Committee that should relieve some financial stress for more than 600,000 veterans.
First, Shulkin said he was dropping VA’s appeal of the Staab case decided last year by the U.S. Court of Appeals for Veterans Claims. Only last week he said Staab had been wrongly decided, exposing VA to at least $2 billion in veteran claims for outside emergency care, money VA needed to provide promised services.
Pulling the appeal means VA intends to begin covering private sector emergency care for any VA-enrolled veteran, even if they have alternative health insurance that pays part of their emergency care costs. As many as 370,000 veterans with pending claims could benefit too, explained Sen. Mike Rounds (R-S.D.), who thanked Shulkin for changing his mind. Shulkin said Rounds and Sen. Richard Blumenthal (D-Conn.) were right to sharply criticize the decision to appeal.
In Staab the appeals court ruled that VA intentionally failed to implement a 2010 law expanding outside emergency care coverage. It did so by continuing to deny reimbursement for non-VA emergent care if a veteran had any sort of alternative health insurance. Veterans with no health insurance routinely are reimbursed the full cost of outside emergency care if VA care isn’t available.
Shulkin told Rounds that VA has completed draft regulations to implement the new emergency care benefit, sending them to the Office of Management and Budget. Draft regulations must clear OMB and be published in the Federal Register for comment before VA can begin reimbursements. That process could take nine months or more, Shulkin advised the committee last week.
Shulkin’s second surprise Wednesday was to tell Sen. Dean Heller (R-Nev.) he will work with Congress to find a less hurtful way to fund his Choice replacement plan, CARE, than by administratively ending Individual Unemployability (IU) eligibility next year for 208,000 seriously disabled veterans age 62 or older.
IU allows veterans with VA disability ratings of 60 to 90 percent to receive enhanced compensation because they are unable to work. IU qualifies veterans to receive disability pay as if they were 100-percent disabled. It adds an average of $1600 to their monthly payments, a VA official told senators.
Shulkin said he reconsidered ending IU for older recipients “as I began to listen to veterans and their concerns, and [veteran service organizations] in particular. It became clear that this would be hurting some veterans and would be a takeaway from veterans who can’t afford to have those benefits taken away.”
The VA chief told Heller: “I am not going to support policies that hurt veterans. So, I would look forward to working with you and all the members of the committee on figuring out how we can do this better. We have budget numbers and targets we have to hit. But we shouldn’t be doing things that are going to be hurting veterans that can’t afford to lose these benefits.”
A week earlier Shulkin said he did take “very seriously” concerns being raised over the proposed IU cut. “Nobody wants to be taking away…benefits from veterans and certainly not putting them into poverty,” he said. But he noted that VA benefits had climbed by $12 billion in the past two years, which justified a review of benefits to verify the purpose of each.
This week Shulkin conceded that ending IU for elderly was a poor choice from a menu of cost-saving options. It would have freed up $3.2 billion annually to pay for his CARE plan, a replacement for Choice. The goal of both CARE and Choice is to improve access to private sector care when VA can’t offer timely local care.
“We had identified [IU dollars] as an opportunity,” Shulkin told Heller. “I think if we were designing this [disability pay] system from the beginning, we wouldn’t have used unemployment insurance to fund people’s retirement. That was the conflict. But [today] that is the benefit. And to withdraw this benefit from people who rely on this money is something that would be very difficult to do.”
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