Several changes to VA disability compensation are active or pending in 2025 and 2026: a 2.8% cost-of-living increase already took effect, a controversial medication rule was rescinded, a House bill would cut tinnitus and sleep apnea benefits, a bipartisan concurrent-receipt bill remains stalled, and budget proposals to reduce payments at age 67 continue to circulate. Existing ratings held for five, ten, or twenty years remain protected by federal regulation regardless of policy shifts.
The 2026 Cost-of-Living Increase
VA disability compensation rates rose 2.8% on January 1, 2026, matching the Social Security COLA as required by law. A veteran rated at 10% now receives $180.42 per month, up about $4.91. A veteran rated at 100% with no dependents receives $3,938.58, an increase of $107.28.1DAV. Veterans Benefits Increase 2.8% to Keep Pace With Inflation2VA. VA Disability Compensation Rates
The Medication Rule and Where It Landed
For most of 2026’s first quarter, the biggest fight over disability ratings involved how the VA treats medication. On March 12, 2025, the U.S. Court of Appeals for Veterans Claims decided Ingram v. Collins, holding that when VA diagnostic codes for musculoskeletal conditions do not explicitly reference medication, the VA must discount the beneficial effects of treatment when assigning a rating. A veteran taking pain medication for a back injury, in other words, should be rated on how severe the condition would be without that medication.3Justia. Ingram v. Collins, No. 23-1798
The VA responded on February 17, 2026, by publishing an interim final rule that amended 38 CFR 4.10 to require ratings based on a veteran’s “actual level of functional impairment” while on treatment. The rule applied to all body systems, including cardiovascular, digestive, and mental health conditions, and was issued without notice-and-comment under “good cause” procedures.4Federal Register. Evaluative Rating: Impact of Medication5Stars and Stripes. New VA Rule on Disability Ratings
After heavy pushback from veterans service organizations, a bipartisan group of lawmakers, and a lawsuit filed in the Federal Circuit, Secretary Doug Collins halted enforcement on February 19, 2026, and the VA formally rescinded the rule on February 27, 2026, restoring the original text of 38 CFR 4.10.6Federal Register. Rescission of Interim Final Rule: Evaluative Rating Impact of Medication The government then abandoned its appeal of Ingram, and the Federal Circuit dismissed the case on March 30, 2026, leaving the Court of Appeals for Veterans Claims decision as binding law.7NVLSP. NVLSP Achieves Major Victory for All Veterans Using Medication
The current position: for musculoskeletal conditions rated under diagnostic codes that do not mention medication, the VA cannot lower a rating based on how well treatment controls symptoms. Evaluations must reflect the body’s ability to function under “ordinary conditions of daily life including employment.”8Cornell Law Institute. 38 CFR 4.10 – Functional Impairment No further rulemaking on medication has been announced.9Federal Register. Rescission of Interim Final Rule
Proposed Cuts to Tinnitus and Sleep Apnea Benefits
The Take Care of America’s Veterans Act (H.R. 9237), introduced by Rep. Mike Bost on June 10, 2026, contains provisions in Section 108 that would reshape compensation for two of the most commonly rated conditions. The bill would end compensation for service-connected tinnitus and substantially reduce compensation for veterans with sleep apnea who use a CPAP device. The changes would apply to new claims and any reassessments of existing claims.10Congress.gov. H.R. 9237 – Take Care of America’s Veterans Act
A VA analysis cited by the DAV and VFW estimated the provisions could affect up to 1.5 million veterans and reduce future compensation payments by roughly $57 billion over ten years.11DAV. DAV Condemns Congressional Proposal to Cut Disability Benefits for 1.5 Million Veterans12VFW. VFW Action Alert: Tell Congress to Oppose Veterans Benefit Cuts The DAV described the cuts as a “poison pill” inserted to satisfy congressional pay-as-you-go budget rules, arguing veterans’ benefits are being used to offset unrelated spending.
As of late June 2026, 47 senators and a coalition of 15 military and veterans groups have formally opposed the tinnitus and sleep apnea provisions.13Military.com. 47 Lawmakers Oppose VA Disability Rule on Sleep Apnea, Tinnitus The bill was under a closed rule for House floor consideration as of June 23, 2026.14Congress.gov. H.R. 9237
Concurrent Receipt: The Major Richard Star Act
Under current law, military retirees who were medically retired with fewer than 20 years of service and a disability rating below 50% cannot receive their full retirement pay alongside VA disability compensation. Retirement pay is reduced dollar-for-dollar by the amount of VA benefits.15Defense Communities. Bipartisan Bill Would Give Vets Concurrent Retirement, Disability Pay
The Major Richard Star Act (H.R. 2102 / S. 1032) would eliminate that offset. With 326 House cosponsors and 79 Senate cosponsors as of May 2026, it has broad bipartisan support but has not reached a floor vote. Unanimous consent attempts in the Senate were blocked in October 2025 and March 2026, and the bill was left out of the final FY 2026 National Defense Authorization Act. Cost has been the recurring obstacle.16MOAA. MOAA SITREP: The Major Richard Star Act
Budget Proposals to Reduce Payments at Age 67
The Congressional Budget Office has published options that, while not introduced as legislation, shape the ongoing budget conversation. One would reduce disability compensation by 30% for veterans who begin receiving benefits in 2026 or later once they reach age 67, the Social Security full retirement age. Veterans already receiving compensation would be exempt. CBO’s rationale is that disability payments replace lost earnings and that earnings typically decline in retirement anyway. Projected savings run from $33.8 billion over ten years to about $40 billion under an updated estimate for 2026–2035.17CBO. Reduce VA’s Disability Benefits for Veterans Older Than the Full Retirement Age18CRFB. CBO’s Other Mandatory Savings Options
A related option would end Individual Unemployability payments to veterans aged 67 and older, with estimated ten-year savings of $70 billion. A narrower version applying only to those reaching that age after December 2025 would save an estimated $15 billion.18CRFB. CBO’s Other Mandatory Savings Options Veterans organizations have opposed these concepts, arguing that service-connected disabilities do not diminish at 67.
PACT Act Expansion Continues
The PACT Act, signed in 2022, continues to add benefits for veterans exposed to burn pits, Agent Orange, and other toxic substances. The VA accelerated its health care expansion on March 5, 2024, making millions of veterans eligible years ahead of schedule. In its first year, the department completed more than 458,000 PACT Act-related claims and delivered over $1.85 billion in benefits.19VA. The PACT Act and Your VA Benefits
The law added more than 20 presumptive conditions for Gulf War and post-9/11 veterans, including several cancers and respiratory illnesses. For Vietnam-era veterans, it added hypertension and monoclonal gammopathy of undetermined significance to the Agent Orange presumptive list and expanded the recognized exposure locations.19VA. The PACT Act and Your VA Benefits If your claim was denied in the past for a condition that is now presumptive, you can file a supplemental claim. There is no deadline for filing a PACT Act claim.
Protections for Existing Ratings
Whatever happens to future policy, federal regulations protect ratings that have already been in place for a substantial period. These protections apply from the effective date of the original rating to the effective date of any proposed reduction.20CCK Law. VA Disability 20-Year Rule
- Five-year rule (38 CFR 3.344(c)): a rating in effect for five or more years generally cannot be reduced unless the VA shows clear evidence of substantial improvement.
- Ten-year rule (38 CFR 3.957): after ten years, the service connection itself cannot be severed except on a showing of fraud or clear and unmistakable error.
- Twenty-year rule (38 CFR 3.951(b)): a rating held for 20 years or longer cannot be reduced below the lowest level it held during that period, absent fraud or clear and unmistakable error in the original decision.
One boundary worth noting: the tinnitus and sleep apnea provisions in H.R. 9237, if enacted, would apply to reassessments of existing claims, not only new ones. The stabilization rules above still constrain what the VA can do to a long-held rating, but a veteran whose rating has not yet reached the five-year threshold has less protection against a downstream reduction if the underlying rating criteria change.