VA: No Disability Pay Unless Vets Repay Separation Benefits

    VA: No Disability Pay Unless Vets Repay Separation Benefits

    Veterans who accepted one-time separation benefit checks from the military are learning they can’t get disability payments now until they pay that money back.

    “You can’t just up and take it back,” one veteran, Vernon Reffitt of Georgia, told NBC News. “That’s wrong.”

    Reffitt got $30,000 in 1992 to leave the Army early when the United States was attempting to reduce its active-duty forces.

    He’s been receiving monthly disability checks for almost three decades, but in May, the Department of Veterans Affairs started withholding his payments, saying that he has to pay back the $30,000. Reffitt, 62, says it will take him almost 15 years to pay the money back.

    Thousands of veterans have also found themselves being ordered to pay back the separation benefits, thanks to a law prohibiting them from getting both disability and special separation pay.

    The law requires the VA to collect the separation benefits pay before allowing veterans to begin receiving disability.

    This means at least 79,000 veterans were forced to repay separation benefits between 2013 and 2020, a Rand Corporation study in 2022 showed.

    There are probably even more vets affected though, because data before 2013 was not available because of VA system changes, according to lead author Stephanie Rennane.

    The RAND study showed the VA has filed to recoup an average of $19,700 to $53,000 to recoup the separation benefits, representing lump sums received after taxes.

    The VA said in Reffitt’s case, it did not know how much money he got through the special separation benefit when he started getting disability payments in 1992.

    The error surfaced when Reffitt filed a claim under the PACT Act, which expanded benefits to veterans who had been exposed to toxic materials.

    According to the VA, veterans sign a form that says separation pay may be recouped from the benefits they receive but Reffitt and other veterans said by then, it’s too late.

    Rep. Ruben Gallego, D-Ariz., introduced legislation to change the recoupment law, but Gallego said the matter is “costly” which is why he has had trouble getting his bill passed.

    Meanwhile, waivers are available, but to get one, the secretary of the veteran’s branch must decide that “recovery would be against equity and good conscience or would be contrary to the best interests of the United States.”

    Army veteran Daphne Young told NBC News that had she known she would have trouble getting her disability pay, she would not have accepted a $15,000 lump sum when she left the military in 2016.

    In April, she learned that the VA was going to start withholding her monthly disability checks of $3,700 until the separation pay was recouped.

    She is fully disabled and cannot work, and said the disability pay was her only income.

    “It took the legs from right underneath me,’ U.S. Marine Corps veteran Shane Collins commented, telling NBC it took about three years to repay a $33,000 separation benefit he got when he left the service.

    Collins worked at the Pentagon and said he was so familiar with the Defense Department manual that he called it his “bible,” but he did not know that he would be forced to repay his separation benefit if he received disability.

    “I thought they were completely separate, and that’s how it was explained to me as well,” he said.

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