$2.44 Billion Reclaimed: Inside the VA Recoupment Fight

Two women exchange cash and a check at an office desk

Under a law dating to the 1940s, veterans who received separation pay, compensation for time served, had to repay it if they later qualified for VA disability benefits. (Federal rules barred receiving both.) The VA would withhold disability checks until the debt was cleared. From 2013 to 2023, this debt recoupment structure equaled $2.44 billion in separation pay and bonuses from 112,834 veterans.

To many, this payment structure may seem like punishment to the disabled veteran. In 2023, Senator Ruben Gallego’s (AZ) Restore Veterans’ Compensation Act of 2023 which would have barred this practice, arguing the two payments serve different purposes. Since that time, the bill has been reintroduced many times. Most recently, Representative Bilirakis (FL) brought the Restore Veterans’ Compensation Act of 2026 to Congress on January 13, 2026. (HR7027 was referred to the Subcommittee on Disability Assistance and Memorial Affairs on May 7, 2026.)

“It is ridiculous to claw back money from a veteran who has put life and limb on the line, just because later in life they qualify for disability benefits,” stated Gallego, acknowledging the fact that traumatic brain injury symptoms often surface or worsen years after service.

*The bill’s chief criticism is fiscal: ending recoupment means the government forfeits future collections.

A Dangerous TBI Two-Way Street

A traumatic brain injury doesn’t just raise your risk of later neurological disorders; preexisting neurological disorders may raise the risk of brain injury, concludes a recent 2026 study from the San Francisco Veterans Affairs Health Care System.

Diagram showing circular relationship between brain injury and epilepsy with arrows indicating feedback loop and mutual exacerbation of seizures and brain damage

Published June 17, 2026. in the journal Neurology, the Department of Defense-supported study tracked more than 55,000 older veterans. Scientists found that traumatic brain injury was tied to higher rates of stroke, dementia, epilepsy, and Parkinson’s disease both before and after the injury. “Our findings raise the possibility that… [pre-existing brain diseases] are themselves risk factors for TBI in older people,” said study author Carrie Peltz, PhD, of the San Francisco Veterans Affairs Health Care System.

In the year before a TBI, older veterans were about three times more likely to have been diagnosed with stroke, dementia, or Parkinson’s and more than four times more likely to have epilepsy. After a TBI, they were roughly twice as likely to have a stroke or epilepsy. This results greatly build on an Oxford Academic, PubMed-accessible, 2025 study that found, “Among those with TBI, patients with pre-injury dementia had particularly high chronic mortality.” While causality has not firmly been medically defined, the study’s results are clear.

Congress Has Been Flying Blind on Veteran Brain Injury Spending for Years

Shiny golden dollar sign with stacks of bills and coins behind

The Special Disabilities Capacity Report is Congress’s primary tool for deciding how much to invest in VA’s TBI treatment infrastructure. If the numbers feeding that decision are wrong, the veterans who depend on that care pay the price.

A February 2026 review by the VA Office of Inspector General revealed that in FY 2023, the VA reported the wrong financial data for traumatic brain injury, using obligations rather than actual expenditures, thereby overstating actual TBI spending. More so, they failed to report TBI spending at both the geographic service area and national levels as required by law. The DVA Office of Inspector General’s Report 25-01863-31 also determined that VA’s capacity data did not capture community care services or the extent to which bed capacity was used at its specialized rehabilitation centers.

Pointedly, these data errors are the same as those that have been flagged in prior years. This raises questions about whether Congress receives an accurate picture of VA’s TBI treatment infrastructure. As Iowa Rep. Mariannette Miller-Meeks, Chairwoman of the House VA Health Subcommittee, stated at a March 2026 oversight hearing: “Wrong data takes resources away from [other] areas of need.”

VA Recognizes TBI Mistake: Positive, But Possibly Too Late

According to the Defense and Veteran’s Brian Injury Center (DVBIC), a cooperative between the Department of Defense and Veteran’s Affairs, “Traumatic brain injury (TBI) is a significant health issue which affects service members and veterans during times of both peace and war.”  Given that the military recognizes that traumatic brain injury (TBI) is a major problem, it is a shock that, since 2007, 25,000 veterans who are now known to suffer from traumatic brain injury were not initially diagnosed and treated for TBI.  (Tested by doctors who have been found to be unqualified, these veterans were diagnosed with post-traumatic stress disorder (PTSD).  PTSD is terrible, yes, but more treatable than TBI.)

Through this major error, tens of thousands of veterans were not given the appropriate medical and financial help they needed and deserved.  Fortunately, the military now realizes its mistakes and can rectify them and prevent them from happening again.  For many veterans, who have struggled for years to get the military to recognize its difficulties, though, is it too little, too late?

(To learn more about TBI and the military from past service members, visit http://www.disabledveterans.org/.)