The VA adjusts monthly compensation amounts based on the yearly change in the cost of living as determined by Social Security.
What Are Cost-of-Living Adjustments (COLA)?
Cost-of-Living Adjustments (COLA) are periodic changes made to VA compensation rates that allow for VA benefit amounts to increase with the rate of inflation.
How is COLA Determined?
VA COLA rates are based on the COLA rates set by the Social Security Administration. COLA is based off of the percentage increase in the Consumer Price Index for Urban Wage Earnings and Clerical Workers from the third quarter of the previous year to the third quarter of the current year.
The Consumer Price Index for Wage Earnings and Clerical Workers (CPI-W) is a statistical measure of change of the prices of goods and services over time in “major expenditure group” such as clothing, food, housing, medical care and other entities that are typically purchased by consumers. The Bureau of Labor Statistics calculates CPI-W on a monthly basis, and Social Security compares the data from the third quarter of the previous year to the third quarter of the current year in order to accurately reflect the change in the cost of living in their compensation rates.
The VA uses the COLA rate from Social Security to make adjustments to veterans’ monthly disability compensation. COLA rates must be passed by Congress, and the House Subcommittee on Disability Assistance and Military Affairs (DAMA) recently introduced the COLA Act of 2018. To learn more about the bill, click here.
When does COLA Go In to Effect?
For 2018, VA rates went into effect on December 1, 2017 and were reflected in veterans’ benefit checks starting December 31, 2017. Disabled veterans and surviving family members of veterans will receive the COLA increase, along with recipients of VA pension and retired military veterans.
The 2018 VA Compensation rates for veterans without dependents are below.
10% disability rate – $136.24
20% disability rate – $269.30
30% disability rate – $417.15
40% disability rate – $600.90
50% disability rate – $855.41
60% disability rate – $1,083.52
70% disability rate – $1,365.48
80% disability rate – $1,587.25
90% disability rate – $1,783.68
100% disability rate – $2,973.86
Veterans who receive VA disability compensation at the 30% rate are eligible for additional compensation for dependent spouses, children, or parents. Those rates can be found on VA’s website. You can use our VA disability calculator to get more insight on your disability rating.