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Congress Considers Automatic COLA Increases

Every year veterans play a waiting game to see if they'll receive a cost-of-living adjustment (COLA).

Congress has never failed to pass legislation to grant these increases. But keeping the adjustment in legislative limbo each year continues to rile veterans groups and some elected officials.

"Congress has routinely provided this increase, but it is an added step that confuses and leaves veterans feeling uneasy until the COLA bill is passed," Raymond Kelly, director of Veterans of Foreign Wars (VFW), said in a statement to the Veterans' Affairs Subcommittee.

A New Jersey Congressman recently introduced legislation that would end the waiting game through automatic COLA increases. It's the latest attempt to give veterans greater peace of mind when it comes to these increasingly important adjustments.

Unnecessary Step

Sponsored by Republican U.S. Rep. Jon Runyan, the American Heroes' COLA Act allows increases in the rates of veterans' disability compensation and survivor benefits to be made automatically each year.

Under the current law, increases in COLA for veterans' disability and survivor benefits are dependent on a bill being passed annually by Congress. The increase traditionally follows the Consumer Price Index (CPI), a measure of the cost of goods and services kept by the Bureau of Labor Statistics. This is the same increase that is given automatically to programs like Social Security and military retirement. Veterans "do not deserve to wait and wonder every year if they will receive an increase in their benefits," Runyan wrote last month in a newsletter for constituents. If passed, the bill would go into effect on Dec 1, 2013.

Political Issues

This isn't the first push to automate COLA increases. In the past, Congress has rejected similar efforts because there are political benefits to the current system.

First, politicians like to be able to say they voted for a bill that increased benefits for veterans. It also creates the potential for some less favorable legislation to become attached to the bill that either gets passed with the increase or kills the measure altogether.

This is why several major veteran organizations have voiced strong support for this new bill, including the Department of Veterans Affairs.

"It would be consistent with Congress’ long-standing practice of enacting regular cost-of-living increases for compensation and DIC benefits in order to maintain the value of these important benefits, but would eliminate the need for additional legislation to implement such increases in the future," Thomas Murphy, the VA's Compensation Service director, told the House Veterans Affairs Committee House Veterans Affairs Committee.

The American Heroes' COLA Act was recently approved by the House Subcommittee on Disability Assistance and Memorial Affairs and is currently with the House Committee on Veterans' Affairs.