For veterans who cannot work due to their service-connected conditions, there are essentially two methods of receiving a 100 percent rating. They can either be granted what is known as a “schedular” 100 percent rating based on their symptoms alone or, if they have not received a 100 percent rating, they can apply for a Total Disability Rating Based on Individual Unemployability, or “TDIU.” A TDIU is a benefit where a veteran is paid disability compensation at the 100 percent level, even if his or her service-connected conditions have not been assigned ratings that reach that level. It is given to veterans who, due to their service-connected disabilities, are unable to get and hold a job that pays them a “substantially gainful” income. Getting a TDIU is much more difficult than it might sound.
For many years, the Veterans Court and veterans’ representatives were frustrated by the VA’s refusal to tell us what exactly “substantially gainful” meant. In the first few years of its existence, the Veterans Court complained of the lack of clarity and called upon the VA to better explain its rules regarding a TDIU. The VA never listened to the Veterans Court’s requests and finally, about a decade later, the Court decided to define “substantially gainful” on its own. The Veterans Court decided that a “substantially gainful” job was “one that provides annual income that exceeds the poverty threshold for one person.” As a result of the Veterans Court’s decision, you cannot be granted a TDIU if you are able to earn more than $11,770 each year. This is, quite frankly, a horrible injustice.
There are a number of glaring issues I discern with using the poverty threshold as a metric to determine whether a veteran is capable of substantially gainful employment. First, from a policy perspective it would be downright depressing for a veteran earning slightly more than a poverty wage to be considered gainfully employed. The poverty threshold is meant to indicate whether a person is unable to support himself, not whether he is living the comfortable life that veterans surely deserve. Second, relying on the poverty threshold for a single person fails to account for veterans with families. Indeed, it is inconsistent with VA’s policy of paying more compensation to married veterans with children to say that a veteran with a wife and two children is capable of supporting his family when he earns a mere $11,770 a year. Furthermore, the federal poverty threshold does not account for regional differences in the cost of living. We can all agree that it costs more to live and eat in New York City than it does to do the same in rural Oklahoma, yet a veteran living in a major city is considered to be earning a “substantially gainful” living if he earns the same amount as a veteran in rural America.
What is most striking about relying on the poverty threshold, however, is that VA compensation payments are supposed to be based upon the “average impairments of earning capacity,” which for an unemployable veteran amounts to approximately $35,000 in tax free benefits per year. This means that VA considers a livable wage for an unemployable veteran to be equivalent to approximately $50,000 before taxes, but considers a livable wage for an employed veteran to be only $11,770. It seems incongruous to say someone has a “substantially gainful” job if they make $11,771 each year, but to pay a tax free $35,000 per year to a veteran who is not capable of “substantially gainful” work.
It is a sad reality that many veterans are unable to earn a decent living due to disabilities that they sustained in service to our country. This sad reality is worsened by the VA’s decision to say that a veteran who earns a penny more than the poverty threshold earns a “substantially gainful” living. This policy leaves many veterans in dire financial situations which is an unfitting reward for their service to the United States.