Federal Policy and the Rise in Disability Enrollment: Evidence for the VA's Disability Compensation Program / Mark Duggan, Robert Rosenheck, Perry Singleton.

Format:

Book

Author/Creator:

Duggan, Mark.

Contributor:

National Bureau of Economic Research.

Rosenheck, Robert.

Singleton, Perry.

Series:

Working Paper Series (National Bureau of Economic Research) no. w12323.

NBER working paper series no. w12323

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Federal Policy and the Rise in Disability Enrollment

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2006.

Summary:

The U.S. Department of Veterans' Affairs (VA) currently provides disability benefits to 2.72 million veterans of U.S. military service through the Disability Compensation (DC) program. Until recently, the medical eligibility criteria for this program were the same across service eras, with the key condition being that the disability was caused or aggravated by military service. But in July of 2001, the VA relaxed the eligibility criteria for Vietnam veterans by including diabetes in the list of conditions covered by DC. This change was motivated by an Institute of Medicine report, which linked exposure to Agent Orange and other herbicides used by the U.S. military in Vietnam, to the onset of diabetes. In this paper, we investigate the impact of this policy change on DC enrollment, expenditures, and the sensitivity of the program to economic conditions. Our findings demonstrate that the Agent Orange decision increased DC enrollment by 7.6 percentage points among Vietnam veterans and that an additional 3.3 percent enjoyed an increase in their DC benefits. Our estimates further suggest that the policy change increased program expenditures by $2.69 billion during the 2006 fiscal year and by $45 billion in present value terms. After the policy took effect, we find that the sensitivity of the program to local economic conditions increased substantially. Taken together, our results suggest that even relatively narrow changes in the medical eligibility criteria for federal disability programs can have a powerful effect on program enrollment and expenditures.

Notes:

Print version record

June 2006.