06/13/2026
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Congressional Republicans introduced a nearly 600-page veterans benefits package on June 10 that would end a longstanding pay offset for combat-injured veterans but would cut disability compensation for up to 1.5 million other veterans to cover the cost.
The bill, called the Take Care of America’s Veterans Act, was introduced by House Veterans’ Affairs Committee Chairman Mike Bost and Senate Veterans’ Affairs Committee Chairman Jerry Moran. It bundles more than 60 pieces of bipartisan legislation and is anchored by the Major Richard Star Act, a measure that has drawn more than 315 House cosponsors but stalled in Congress for years.
Under current federal law, veterans who were medically retired from the military before completing 20 years of service due to combat-related injuries cannot receive their full military retirement pay and VA disability compensation simultaneously. Their retirement pay is reduced dollar-for-dollar by whatever disability compensation they receive from the Department of Veterans Affairs—a policy critics call the “wounded veteran tax.”
The offset affects an estimated 50,000 to 54,000 veterans. In some cases, the reduction eliminates retirement pay entirely.
The Poison Pill
The Congressional Budget Office has estimated the Major Richard Star Act alone would cost $78 billion in direct federal spending over the 2026-2036 period. Under congressional PAYGO rules, that cost must be offset.
That offset comes from the effective elimination of VA disability compensation for tinnitus and sharply reduce compensation for veterans with obstructive sleep apnea who manage the condition with a CPAP device. The changes would apply to all new claims and to future reassessments of existing claims.
The Department of Veterans Affairs projects Section 108 would reduce disability compensation payments by up to $57 billion over 10 years and affect up to 1.5 million veterans.
VSO Reactions
Major veterans service organizations responded quickly and critically to the bill’s PAYGO provisions. The Veterans of Foreign Wars announced its opposition the day after the bill was introduced.
“The VFW strongly opposes the Take Care of America’s Veterans Act as currently drafted because it asks future disabled veterans to bear the cost of expanding benefits through changing the VA rating schedule for tinnitus and obstructive sleep apnea, which are common conditions associated with combat poly trauma,” said VFW National Commander Carol Whitmore. “Veterans’ benefits are an earned obligation of the nation, a promise made through the military service contract, and should not be financed through offsets, fee increases or reductions that place additional burdens on veterans, military families and survivors. A grateful nation pays its debts to veterans; it does not send them the invoice.”
DAV National Commander Coleman Nee acknowledged the package included provisions the organization sought for years but said the tinnitus and sleep apnea cuts were unacceptable.
“We reject the premise that the only way to fulfill the promises made to the men and women who served in the past is by cutting benefits for veterans in the future,” Nee said. “Eliminating compensation for sleep apnea and tinnitus is not a reflection of improved outcomes for veterans—it is a budget-driven decision that shifts the burden onto those who have already sacrificed.”
Iraq and Afghanistan Veterans of America also formally opposed the bill. IAVA said it opposed the legislation “based on its intent to finance new veterans benefits by reducing or restricting earned disability compensation for other disabled veterans.”
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