Senator Gallego introduces bill to stop VA recouping separation pay from disabled veterans

Published Aug 6, 02:13 PM UTC

Senator Ruben Gallego (D-AZ) introduced the Restore Veterans Compensation Act on August 6, 2026, to prevent the Department of Veterans Affairs (VA) from recouping military separation pay from veterans who later qualify for disability compensation. The bill would bar the VA from collecting voluntary or involuntary separation pay from disabled veterans and allow those qualifying for military retirement pay to repay only the net amount received after taxes. Gallego, a former Marine and Iraq War veteran, argues the payments serve different purposes—disability as workman's compensation and separation pay as a force management tool. From 2013 to 2023, the VA recouped $2.44 billion from 112,834 veterans. The bill also reduces the recoupment rate for retired veterans from 40% to 25% of their paychecks. A separate bill by Senator James Risch (R-ID) would cap monthly recoupment at 25% of disability checks. The legislation has support from Disabled American Veterans.