Disabling Dollars

The Department of Veterans Affairs pays out billions each year to veterans who suffered any injury or illness during their service. Yet critics say the century-old system has strayed far from its mission.

The Department of Veterans Affairs pays out billions each year to veterans who suffered any injury or illness during their service. Yet critics say the century-old system has strayed far from its mission. None


Thousands of miles away from the confines of home, with the afternoon sun shining overhead, Lt. Col. Daniel Gade lay in a ditch, certain he was dying.

One moment, Gade and his fellow soldiers were riding in a convoy through Iraq. The next, he awoke in the ditch while a medic reached into a large gash in his right leg to stop the profuse bleeding.

‘Sir, you’re going to be fine,’ a soldier said.

‘Are my legs OK?’ Gade said.

The soldiers assured their lieutenant he would survive after his tank struck a roadside bomb. But the nearly 20-year Army veteran wasn’t convinced.

“Everybody that’s seen a war movie knows you just tell the dying guy, ‘Yeah, you’re going to be fine,’” Gade said. “And I was dying at that point. Really.”

He would spend three weeks in a medically induced coma. He suffered a broken neck, skull fracture, kidney and liver failure and an amputated right leg.

His battle was just beginning.

There are more than four million veterans who claim disabilities due to their service. Their conditions range from PTSD, hearing loss, sleep apnea, erectile dysfunction to a lost limb, among hundreds of others. The Department of Veterans Affairs pays $60 billion a year for disability compensation. The century-old program gives veterans, in some cases, up to $40,000 per year in tax-free money.

The idea behind the system: take care of the men and women who fought for our country by compensating them for “considerable loss of working time” due to their illness or injury incurred or aggravated by their time in service. But it isn’t so simple. Critics say the system creates a culture of dependency that, in some cases, hurts veterans.

Once recovered and home, Gade sat in a meeting with a Department of Veteran Affairs (VA) representative to determine and document the extent of his injuries, a common practice for veterans upon their return from duty or those who are transitioning out of service.



There are more than 900 illnesses and ailments the VA acknowledges – the majority of which are conditions people experience in everyday life, according to the VA’s annual benefits report.

In addition to his broken bones and leg amputation, veteran service officers encouraged Gade to claim PTSD, hearing loss and a traumatic brain injury due to his cracked skull and coma.

Gade rejected those recommendations.


Chris Hernandez spent 27 years serving in the military, including tours in Iraq and Afghanistan, and has seen the dangers of war: the gunfire, the explosions, the death toll.

Hernandez said the worst injuries he suffered were bumps and bruises—maybe an occasional rolled ankle. Certainly nothing he felt the need to claim disability for, he said.

Which made it all the more shocking when he sat in a debriefing meeting after his tour in Iraq.

“File a disability claim for everything. If your back hurts, file a claim. If you have ringing in your ears, file a claim,” Hernandez recalls a counselor telling a group of soldiers. “If your knee hurts, file a claim. If your toe hurts, file a claim. Anything, file a claim.

“And a solider from my unit raises his hand and asks, ‘Should we really file a claim for every little thing?’ And the guy says, ‘Well, how much money do you want every month?’”

The system, Hernandez says, sets veterans up to sell out their oath.

“All the things we’re supposed to uphold in the military: honor, pride, integrity,” he says, “it’s a complete betrayal of that. It is selling our honor for welfare money.”

The number of diagnosed PTSD cases among veterans has more than doubled since 2010. None


Brandon Vance is 60 percent disabled, according to the VA.

Vance is a four-year Air Force veteran who was stationed in San Antonio. He’s never served overseas. The worst injury he can recall during his service is falling down a flight of stairs while running to work, injuring an ankle. Vance says he’s struggled with migraines, depression, and recurring sinus infections, but nothing he felt he needed to claim for disability. After all, he didn’t believe any of those issues were even caused by his military service, they just happened to arise during his time on base.

That is until his family and friends persuaded him to apply for benefits 16 years ago. Vance was approved for 40 percent disability, or about $500 a month. Even more to his surprise, the VA approved 13 months of back pay, too.

“I truly did not expect they would actually approve me for disability,” Vance said.

Vance admits it felt wrong, but the money became a crutch that allowed him to bounce between jobs he didn’t like, always having a fallback if money was tight. Once approved for $500 a month, he says he wanted more. Like many veterans collecting disability, Vance re-applied multiple times in an effort to raise his rating, and eventually, he succeeded. The VA boosted his disability rating and his check grew to more than $1,200 per month. 

Although Vance didn’t feel disabled in the traditional sense of the word, being approved for disability made him think maybe there was something he was missing.

“I remember clearly thinking, ‘Hmm, maybe I’m broken and just don’t know it,” he said. “That’s a scary thought.”

Over the past 15 years, payments to veterans have quadrupled with the VA’s encouragement—from $15 billion in 2000 to $60 billion in 2015. One ailment driving the surge of claims: PTSD.

In 2010, the VA relaxed its rules for veterans seeking a PTSD diagnosis. Rather than experiencing a traumatic event, veterans now only have to fear something bad could happen.

The new rules gave way to a flood of applicants. The number of diagnosed PTSD cases more than doubled from 387,000 before the rule change to 813,000 last year, making PTSD the third most diagnosed disability.

But academic studies raise questions about if all veterans diagnosed with the condition truly suffer from it. A 2016 study conducted by researchers from the VA’s National Center for PTSD found approximately 30 percent of veterans diagnosed with PTSD did not actually have it.


Dr. Chris Frueh worked as a VA psychologist for 15 years, and continues to research PTSD in veterans. He says he's seen veterans work the system to keep their monthly checks coming.

“Veterans would come in for treatment, they would be grateful and thank us,” Frueh said. “But then in the next breath, they would say 'I'm doing better; I want you to know that. But please don't document that in my medical record, I don't want to risk losing my disability benefits.'”

Disability compensation for a veteran with a spouse and two children rated 50 percent disabled is about $12,000 per year. Veterans who are diagnosed 100 percent disabled can earn as much as $39,000 per year in tax-free money.

“The disability system provides a very clear incentive to remain sick,” Frueh said. “The sicker you are, the more money we’re going to give you.”

While PTSD treatment has proven effective in civilian populations, the VA does not require veterans to seek treatment in order to receive disability compensation.

In the VA disability system, receiving disability for the disorder is usually considered permanent.

In 2015, less than 1 percent of veterans receiving disability compensation for PTSD saw their rating reduced last year, according to statistics provided by the VA.



“The VA encourages veterans to see themselves as ill, as disabled, essentially as damaged goods who can’t be expected to integrate into society of the workforce,” Frueh said. “We’re encouraging them to have a negative expectation for themselves and their lives.”

Some psychologists, such as Frueh, say because a PTSD diagnosis relies heavily on self-reported symptoms, it can be easy to exaggerate or fabricate symptoms.

In online forums and websites, KHOU 11 Investigates found veterans coaching each other on how to act in a PTSD exam. “Dress like a vet” they advise, “not like a successful businessman.” When asked about homicidal thoughts say, “every time someone gets too close to me.” Others warn veterans to avoid saying “My life is OK," “I am happily married," or “I love my job.”


Dr. Robert Moering, a former Marine and licensed psychologist, says the VA’s policies leave the system vulnerable to fraud and abuse. While working at the Tampa VA he raised concerns, but says speaking out ultimately cost him his job.

“We’re taking money away from people who truly have a need,” Moering said.

Of the 7,000 PTSD compensation exams he conducted, Moering says roughly half of the veterans exaggerated or fabricated symptoms. In one of the more startling cases, Moering said a veteran claimed he suffered PTSD after he was wounded by an improvised explosive device (IED) while in Iraq.

When Moering investigated further he discovered the man’s dental records, which showed the man was stateside the day he claimed to have been wounded. His service records revealed he’d never deployed overseas, either.

But Moering says the VA discourages psychologists from trying to verify veterans' claims and stories.

“We were not allowed to go on the internet and basically fact check these individuals,” he said. “When you take out the ability to look at the veracity of a story, you’re left with saying, ‘Well, if this person is telling the truth, these are the symptoms associated with it.’ But we have no way of knowing.”

In another instance, Moering said he evaluated a veteran for PTSD who claimed a close friend died in his arms while deployed. Moering looked closer into the claims and found the man’s friend had in fact died, but the veteran was actually stateside when his friend died.

Sample files of VA records obtained by KHOU 11 Investigates shows that veterans “over-reported and exaggerated symptoms” —leaving examiners to conclude there was “intentional exaggeration” and “motivation by external incentives (i.e. VA compensation).”

Without thorough psychological tests and fact checking, Moering worries PTSD is being over diagnosed and over compensated—potentially diverting treatment, time, and resources from veterans who truly need help.

“To me, to not address that, that’s anti-veteran,” he said.


Beth Murphy says the system isn’t broken.

The director of compensation services for the Veterans Benefits Administration (VBA), a division of the VA that oversees payments to disabled veterans, thinks the number of payouts should increase.

To date, 4.3 million veterans receive disability compensation. Murphy would like to see that number include more of America’s 21 million veterans.

“These are folks that have served our country, and we have a duty and a mission to help them,” Murphy said. “We don’t look to deny. We have a duty to assist.”

Murphy said she’s unaware of studies that raised concerns about PTSD and stands by the VA’s rules for diagnosing the disorder.

“We’re a benefits process,” she said. “Of course there’s opportunity or potential that someone would exaggerate benefits. But that’s not the majority of our situations. ... Every individual is different; everybody has a different mental or physical capacity, their reaction to what they’ve been exposed to in service.”

But she does believe that there is always room for improvement within the system.

“Our system is always looking for ways to do things better for veterans,” she said.

Vance, the Air Force veteran stationed in San Antonio wants to see a better process for veterans who want to lower their monthly payments or get off disability completely.

There is a little-known rule that allows veterans to renounce their payments while remaining eligible for treatment, but it isn’t widely used. Of the 4.3 million veterans receiving disability compensation, only 728 renounced their money last year.

Frueh, the former VA psychologist, has his own recommendations to fix the system, such as a treatment-first approach.

“In other words, rather than just giving someone disability, require them to go through a period of treatment first,” he said. “We could incentivize getting better. We could incentivize work, employment and earnings.”

Gade, the lieutenant colonel who lost his right leg, points to a specific example of how the system is broken: A veteran with sleep apnea is considered 50 percent disabled and could receive more than $1,000 per month, while a veteran who’s lost a leg is considered 40 percent disabled and is eligible for $700 per month.

Gade believes the system needs a total overhaul, which hasn’t happened since 1945.


READ MORE: A Better Way to Help Veterans by Daniel M. Gade

He suggests the VA only pay veterans whose disability has caused long-term detriment to their physical or mental health, in a way that can’t be overcome by therapy. If the VA distinguished between conditions, like sinusitis, and disabilities, like limb loss, Gade says the system could better serve veterans who are truly in need. 

He also believes the VA could encourage veterans to seek treatment by offering a financial incentive up-front.

“If you can use the money to encourage people to get treatment, then people will get better,” he said.

Gade says the goal of the program should be to help veterans re-gain their quality of life, which in turn, benefits everyone.

“Every veteran who is paid to be out of the labor market is someone whose richness of experience, whose motivation, whose creativity is bottled up and put on a shelf,” Gade said. “It’s the wrong way to treat people who have served our country honorably.”

But change won’t be easy.

For years, government entities like the Congressional Budget Office, the Government Accountability Office, and the VA’s Office of Inspector General have issued reports raising concerns about the system. Yet no sweeping changes have occurred.

“Behind closed doors, all of these people recognize that this system is flawed and it's hurting veterans. They all know it,” Gade said.


Without accepting any disability compensation, Gade has earned a doctorate in public policy, has worked at the White House and currently teaches at the United States Military Academy at West Point.

Gade says once he retires from the Army he will accept disability compensation. Even then, he says, it will be for injuries that have significantly changed his life, like the loss of his right leg.

“(The system) is going to have to change at some point, because it’s going to collapse under its own weight,” he said. “When it does, if it doesn’t change before that, a lot of great men and women are going to be hurt.”

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