What you need to know about VA debt and debt relief notices

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VA resumes debt notifications to veterans effective October 1, 2021.

If you owe VA money for an overpayment related to veteran’s benefits, or for medical care and pharmacy debt, here are some things you need to know.

Performance debts

VA has automatically postponed the collection of performance debts created on or after April 6, 2020 until September 30, 2021 in an effort to alleviate the COVID-19 pandemic. Performance debts that arose before April 6, 2020 were deferred upon application. VA has also suspended all debt collection activities under the jurisdiction of the U.S. Treasury Department through September 30, 2021.

Most VBA performance debts are collected by the VA Debt Management Center (DMC). This includes debt for benefits like compensation, retirement, and education. If VBA created a debt for you during the collection process, you have likely received informational letters from DMC knowing your debt existed, but you didn’t have to act until after September 30th unless you wanted to.

What’s happening now

On October 1, 2021, the DMC began sending out debt notification letters containing timetables for next steps. The letters are sent out in phases over a period of several months, so you may not receive your debt ruling in October. If you’ve asked DMC to temporarily suspend your payment plan due to the COVID-19 pandemic, it will not automatically resume on October 1, 2021.

Relief options

If you’re having financial difficulties and can’t repay your VA debt right away, there are a variety of relief options available, including:

  • Extend repayment plans
  • Application for debt relief through the waiver procedure
  • Submit a compromise offer to pay off the debt for less than the full amount
  • Request for a temporary suspension of hardship by September 30, 2022

What if you do not contact DMC when you receive your guilty notice?

When you receive VA benefits, VA will withhold money from your benefit payments to meet an outstanding debt. It is important to contact DMC after receiving your debt notice if the amount VA is proposing to withhold from your benefits doesn’t work for you.

Finally, unpaid debts can fall into arrears and be referred to the Treasury Department and / or credit bureaus. Currently, DMC continues to pause new performance debt transfers to the Treasury Department or credit bureaus to ensure veterans have sufficient time to make payment arrangements or apply for discharge. For all debts that were transferred before the pandemic, the Ministry of Finance will resume collection activities from October 1, 2021.

Contact information

For help with the options for your VBA performance debt, call the DMC at 1-800-827-0648 or submit your request online at https://iris.custhelp.va.gov/app/ask/. Veterans can also access information about performance debt at https://www.va.gov/manage-va-debt, such as:

Medical supplies and pharmacy debt

The American rescue plan, passed in March 2021, included a provision canceling co-payments for medical and pharmacy services from April 6, 2020 to September 30, 2021, and ordering reimbursements.

To date, VA has canceled $ 880 million in co-payments for over 2.4 million veterans and paid over $ 240 million in refunds to 1.5 million veterans who made payments for fees prior to the U.S. rescue plan being passed were set.

The collection of co-payments for medical care and pharmacy services will resume on October 1, 2021. The October 2021 statements show fees for medical care and pharmacy services provided before April 6, 2020 and on or after October 1, 2021. VA employee has completed the reimbursement of co-payments for care provided from April 6, 2020 to September 30, 2021. The VHA only began sending informational statements in July 2021 to keep veterans updated on balances owed.

Deleveraging options such as repayment plans, waivers, and compromises are available. Veterans can click for information or call 866-400-1238 Monday-Friday, 8:00 am-8:00pm ET to learn more.

Patient declarations can be viewed online: https://eauth.va.gov/accessva/

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