Veterans' Compensation Cost-of-Living Adjustment Act of 2021
Oct 8, 2021
Statute: 135 Stat. 389
Became law: Oct 8, 2021
Oct 8, 2021
Statute: 135 Stat. 389
Became law: Oct 8, 2021
Summary
Raises the payment amounts for veterans with service-related disabilities and for the families of veterans who have died, based on the cost of living.
What problem does this solve?
The value of veterans' disability and survivor benefits decreases over time as the cost of everyday goods and services rises due to inflation. This law requires that these benefits increase at the same rate as Social Security benefits, helping veterans and their families maintain their buying power.
What does this law do?
Increases veteran compensation rates
Requires the Secretary of Veterans Affairs to increase the dollar amounts for disability compensation and dependency and indemnity compensation.
Links increase to Social Security COLA
Specifies that the percentage increase must be the same as the cost-of-living adjustment for Social Security benefits.
Specifies benefits to be increased
Lists the specific benefits to be increased, including wartime disability compensation, additional pay for dependents, clothing allowances, and survivor benefits.
Who does this affect?
- Veterans with service-connected disabilities
- Surviving spouses and children of certain disabled veterans
What is the real world impact?
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Maintains the value of veteran benefits
Ensures that the financial support provided to disabled veterans and their survivors keeps pace with inflation. Without this yearly adjustment, their fixed income would buy less and less each year, causing financial hardship.
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Ties benefits to a general inflation measure
Links the increase to the Social Security cost-of-living adjustment, which is based on a general measure of inflation. Some argue this may not fully cover the unique rising costs, like healthcare, that disabled veterans face.
When does this start?
The increased compensation rates become effective on December 1, 2021.