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106th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     106-783

======================================================================



 
                     VETERANS BENEFITS ACT OF 2000

                                _______
                                

 July 24, 2000.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

   Mr. Stump, from the Committee on Veterans' Affairs, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 4850]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Veterans' Affairs, to whom was referred 
the bill (H.R. 4850) to provide a cost-of-living adjustment in 
rates of compensation paid to veterans with service-connected 
disabilities, to enhance programs providing compensation and 
life insurance benefits for veterans, and for other purposes, 
having considered the same, report favorably thereon without 
amendment and recommend that the bill do pass.

                              Introduction

    The reported bill reflects the Committee's consideration of 
several bills introduced during the 106th Congress, to include 
H.R. 3816, H.R 3998, H.R 4131, and H.R. 4376.
    On April 13, 2000, the Subcommittee on Benefits held a 
hearing and considered, among other matters, H.R. 3816, H.R. 
3998, and H.R. 4131.
    On July 13, 2000, the Chairman and Ranking Member, the 
Honorable Bob Stump and the Honorable Lane Evans, along with 
the Chairman and Ranking Member of the Subcommittee on 
Benefits, the Honorable Jack Quinn and the Honorable Bob 
Filner, introduced H.R. 4850, which contains provisions from 
H.R. 3816, H.R. 3998, H.R. 4131, and H.R. 4376.
    On July 18, 2000, the Subcommittee on Benefits ordered H.R. 
4850 reported favorably to the full Committee.
    On July 20, 2000, H.R. 4850 was ordered reported favorably 
by the full Committee to the House.

                      Summary of the Reported Bill

    H.R. 4850 would:

                 Title I: Annual Compensation Increase

    1. Increase the rates, effective December 1, 2000, of 
disability compensation for veterans with service-connected 
disabilities and the rates of dependency and indemnity 
compensation for survivors of certain disabled veterans.

                    Title II: Benefits Improvements

    1. Provide that a stroke or heart attack that is incurred 
or aggravated by a member of a reserve component in the 
performance of duty while performing inactive duty training 
shall be considered to be service-connected for purposes of 
benefits under laws administered by the Secretary of Veterans 
Affairs.
    2. Provide an additional special monthly compensation for 
the service-connected loss of one or both breasts due to a 
radical mastectomy shall be the same as the rate for the 
service-connected loss or loss of use of one or more creative 
organs.

                   Title III: Veterans Life Insurance

    1. Permit certain members of the Individual Ready Reserve 
to participate in the Servicemembers' Group Life Insurance 
program.

                       Background and Discussion

    There were 2.6 million veterans receiving disability 
compensation as of May 2000. The Department of Veterans Affairs 
expects expenditures for disability compensation to be $15 
billion for fiscal year 2000. The basic purpose of the 
disability compensation program is to provide a measure of 
relief from the impaired earning capacity of veterans disabled 
as the result of their military service. The amount of 
compensation payable varies according to the degree of 
disability, which, in turn, is required by law to represent, to 
the extent practicable, the average loss of earning capacity 
resulting from such disability or combination of disabilities 
in civil occupations.
    To be eligible to receive disability compensation, a 
veteran must have contracted a disease, suffered an injury 
which is not the result of willful misconduct, or aggravated an 
existing disease or injury in the line of duty during active 
duty service, and have been discharged under other than 
dishonorable conditions.
    The responsibility for determining a veteran's entitlement 
to service connection for a disability rests solely with the 
Department of Veterans Affairs.

  DEPENDENCY AND INDEMNITY COMPENSATION FOR SURVIVORS OF VETERANS WHO 
                 HAVE DIED OF SERVICE-CONNECTED CAUSES

    As of May 2000, there were 286,302 surviving spouses and 
32,416 children receiving dependency and indemnity 
compensation(DIC). VA expects DIC expenditures of $3.5 billion in 
fiscal year 2000. Widows and children of veterans who died of causes 
determined to be service-connected are entitled to receive monthly DIC.
    The purpose of this benefit, authorized under chapter 13 of 
title 38, is to provide partial compensation to the appropriate 
survivors for the loss in financial support due to the service-
connected death. Income and need are not factors in determining 
a surviving spouse's or child's entitlement since the Nation 
assumes, in part, the legal and moral obligation of the veteran 
to support the spouse and children.
    In 1992, Congress reformed the manner in which payments of 
DIC are made. Under current law, for death occurring on and 
after January 1, 1993, a base rate of $881 per month is payable 
to a surviving spouse. Such amount is increased by $191 if the 
veteran suffered from a service-connected disability which was 
rated 100 percent for a period of eight years immediately 
preceding death and if the veteran and surviving spouse were 
continuously married during that period. For service-connected 
deaths occurring prior to January 1, 1993, payment of DIC is 
made on the basis of the veteran's military pay grade if the 
result would be a higher benefit level than under the new 
payment structure. Rates for these ``grandfathered'' surviving 
spouses range from $881 for the spouse of an E-6 to $1,878 for 
the surviving spouse of an O-10. Surviving spouses are 
currently entitled to an additional $222 per month for each 
child.
    There is an additional allowance, currently $222 monthly, 
which is payable to eligible surviving spouses who are patients 
in a nursing home or who are in need of the regular aid and 
attendance of another person.
    If there is no surviving spouse receiving dependency and 
indemnity compensation benefits but there is a surviving child, 
the child is currently entitled to $373 monthly with additional 
benefits for other children with certain limits due to age, 
disability, and status as a student.

                 TITLE I: ANNUAL COMPENSATION INCREASE

    This section would direct VA to compute and provide 
increases in the monthly rates of compensation and DIC, 
effective December 1, 2000. The rates would be increased by the 
same percentage as the Social Security cost-of-living 
adjustment (COLA) that will take effect on that date. If the 
increase does not result in a whole dollar amount, it shall be 
rounded down to the next lower dollar amount. This section 
would provide a full COLA for both old- and new-law DIC 
recipients. The Committee is following its recent practice of 
setting the COLA by reference to the yet-to-be determined 
Social Security increase.
    The Committee annually reviews the service-connected 
disability compensation and DIC programs to ensure that the 
benefits provide reasonable and adequate compensation for 
disabled veterans and their families. Based on this review, the 
Congress acts annually to provide a cost-of-living adjustment 
(COLA) in compensation and DIC benefits. The Congress has 
provided annual increases in these rates for every fiscal year 
since 1976.

                    TITLE II: BENEFITS IMPROVEMENTS

 Presumption of Service Connection For Heart Attack or Stroke Suffered 
  by a Member of a Reserve Component in the Performance of Duty While 
                   Performing Inactive Duty Training

    This section would require the Department of Veterans 
Affairs to treat claims for strokes or heart attacks that occur 
in the line of duty during inactive duty training as service-
connected. Reservists or guardsmen who suffer one of these 
conditions would become eligible for veterans benefits and 
services. Their survivors would also become eligible for 
benefits. Inactive duty training generally means the training 
reservists and guardsmen perform on weekends.
    Under current law, guardsmen and reservists who sustain an 
injury during inactive duty training are eligible for certain 
veterans' benefits. They are not eligible to receive disability 
compensation for a disease condition that is incurred or 
aggravated during such training. The U.S. Court of Appeals for 
the Federal Circuit has upheld VA General Counsel precedent 
that a heart attack is the result of disease, not injury.
    This provision does not change the distinction between 
injury and disease. Rather, it recognizes that certain non-
traumatic physiological events or episodes during required 
periods of Inactive Duty for Training, such as the strain of 
unaccustomed exertion, may result in disability or death 
through heart attack or stroke.

Special Monthly Compensation For Service-Connected Loss of One or Both 
                       Breasts Due to Mastectomy

    This section would authorize special monthly compensation 
under title 38, United States Code, section 1114(k), for the 
service-connected loss of one or both breasts due to a radical 
mastectomy or modified radical mastectomy. Section 1114(k) 
authorizes a special rate of compensation if a veteran, as the 
result of service-connected disability, has suffered the 
anatomical loss or loss of use of one or more creative organs, 
or one foot, or one hand, or both buttocks, or blindness of one 
eye, having only light perception, or has suffered complete 
loss of the ability to speak, or deafness of both ears. The 
current monthly award is $76 for each such loss or loss of use. 
The special monthly compensation is payable in addition to the 
compensation payable by reason of ratings assigned under the 
rating schedule.
    From a review of past changes to this subsection, it 
appears that Congress has singled out specific disabilities for 
this additional benefit because they 1) generally involve 
visible damage which may be thought to stigmatize the disabled 
veteran; 2) may limit social opportunities or interactions in a 
way that were not considered to be adequately compensated; or 
3) involve personal or social impairments of an extreme nature. 
A recommendation to provide this additional compensation for 
the loss of a breast was included in the VA Advisory Committee 
on Women Veterans 1998 Report to Congress. It recognizes that a 
radical or modified mastectomy frequently results in severe 
physical disfigurement that necessitates major reconstructive 
surgery, the use of prosthetics, or both. Additionally, 
temporary or permanent limitation of the use of the armand 
shoulder may follow the surgery. In addition to the loss of physical 
integrity, the loss of a breast to a woman--the fastest growing 
population of VA eligible veterans in America--is the loss of an 
identifying feature, a secondary sex characteristic and a part of her 
persona as a female.

                   TITLE III: VETERANS LIFE INSURANCE

    The Servicemembers' Group Life Insurance (SGLI) program 
began in 1965 for Vietnam-era servicemembers and continues 
today. SGLI, while supervised by VA, is administered in large 
part by the Department of Defense and, for claims purposes, by 
Prudential's Office of Servicemembers' Group Life Insurance 
(OSGLI). It provides up to $200,000 of life insurance coverage 
to members of the uniformed services (active duty, reservists, 
commissioned members of the Public Health Service and National 
Oceanic & Atmospheric Administration, and the four military 
service academies). There are approximately 2.4 million members 
covered under the SGLI program.
    At the time each member enters the uniformed services, they 
are automatically covered by the maximum SGLI but can opt out, 
or lower coverage, only in writing. The uniformed services are 
responsible for premiums payments and get reimbursed by the 
individual members.

  Eligibility of Certain Members of the Individual Ready Reserve for 
                  Servicemembers' Group Life Insurance

    Section 301 would provide those members of the Individual 
Ready Reserve (IRR) who are subject to involuntary call-up 
authority to enroll in the Servicemembers' Group Life Insurance 
(SGLI) program. These IRR members have been identified as such 
critical manpower assets in the Services' mobilization planning 
systems that their involuntary call to active duty under a 
Presidential Reserve Call-up may occur prior to many Selected 
Reserve members being involuntarily called to active duty. 
Eligibility for SGLI is one of the few benefits that can be 
offered under the current statutes to these servicemembers, who 
are critical in the event of a national emergency or war. 
Expanding the pool of eligible members will also provide for a 
greater participation in the current SGLI program.
    This provision is consistent with section 511 of the 
National Defense Authorization Act for Fiscal Year 1998 (Public 
Law 105-85) that established this new category within the IRR 
with the requirement in section 511, which states: ``(4) A 
member in such mobilization category shall be eligible for 
benefits (other than pay and training) as are normally 
available to members of the Selected Reserve, as determined by 
the Secretary of the Defense.''

                      Section-By-Section Analysis

    Section 1 would be cited as the ``Veterans Benefits Act of 
2000''.
    Section 101(a) would authorize the Secretary of Veterans 
Affairs to increase, effective December 1, 2000, the dollar 
amounts in effect for the payment of disability compensation 
and dependency and indemnity compensation.
    Section 101(b) would specify the programs to receive 
increased dollar amounts: compensation, additional compensation 
for dependents, clothing allowance, new DIC rates, old DIC 
rates, additional DIC for surviving spouses with minor 
children, additional DIC for disability, and DIC for dependent 
children.
    Section 101(c)(1) would increase the dollar amounts for 
those specified in subsection (b) based on the amount in effect 
on November 30, 2000. Each amount shall be increased by the 
same percentage by which benefits are increased under title II 
of the Social Security Act (42 U.S.C. 401 et seq.).
    Section 101(c)(2) would round down to the next lower dollar 
amount all compensation and DIC benefits, when the amount is 
not a whole dollar amount.
    Section 101(d) would provide a special rule authorizing the 
Secretary of Veterans Affairs to adjust administratively, 
consistent with the increases made under subsection (a), the 
rates of disability compensation payable to persons within the 
purview of section 10 of Public Law 85-857, who are not in 
receipt of compensation payable pursuant to chapter 11 of title 
38, United States Code.
    Section 102 would require the Secretary of Veterans Affairs 
to publish in the Federal Register the amounts specified in 
subsection (b), as increased pursuant to that section.
    Section 201(a) would amend section 101(24) of title 38, 
United States Code, to include an acute myocardial infarction, 
a cardiac arrest, or a cerebrovascular accident resulting in 
disability or death and occurring during any period of inactive 
duty training for the purposes of benefits administered by VA.
    Section 202 would amend section 1114(k) of title 38, United 
States Code, by making eligible for special monthly 
compensation the service-connected loss of one or both breasts 
due to a radical mastectomy or modified radical mastectomy.
    Section 301(a) would amend section 1965(5) of title 38, 
United States Code, by extending eligibility for the 
Servicemembers' Group Life Insurance program to a person who 
volunteers for assignment to a mobilization category in the 
Individual Ready Reserve, as defined in section 12304(i)(1) of 
title 10, United States Code.
    Section 301(b) makes conforming amendments to sections 
1967(a), 1968(a), and 1969(a)(2)(A) of title 38, United States 
Code.
    Section 301(c) would provide an effective date of October 
1, 2000, for section 301.

                           Oversight Findings

    No oversight findings have been submitted to the Committee 
by the Committee on Government Reform and Oversight.

                  Statement of Administration's Views

    The Administration's proposed fiscal year 2000 budget 
request, submitted in February, 2000, recommended an increase 
based on the change in the Consumer Price Index (CPI) be given 
to all compensation beneficiaries, including DIC spouses and 
children, effective December 1, 2000. The estimated increase in 
the CPI at that time was 2.5 percent.
    At a Subcommittee on Benefits hearing on April 13, 2000, 
the Administration testified in support of a cerebrovascular 
accident or an acute myocardial infarction occurring during 
inactive duty training as a disability incurred in the line of 
duty, and for providing special monthly compensation for the 
service-connected loss of one or both breasts due to radical 
mastectomy.

               Congressional Budget Office Cost Estimate

    The following letter was received from the Congressional 
Budget Office concerning the cost of the reported bill:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 21, 2000.
Hon. Bob Stump,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.

    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 4850, the Veterans 
Benefits Act of 2000.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Evan 
Christman and Michelle Patterson.
            Sincerely,
                                          Dan L. Crippen, Director.
    Enclosure.

H.R. 4850--Veterans Benefits Act of 2000

    Summary: H.R. 4850 contains provisions that would affect a 
range of veterans' programs, including life insurance, 
disability compensation, and dependency and indemnity 
compensation. CBO estimates that enacting the bill would 
increase direct spending by about $1 million in 2001, $6 
million over the 2001-2005 period, and $17 million over the 
2001-2010 period.
    The bill also would increase the amounts paid to veterans 
for disability compensation and to their survivors for 
dependency and indemnity compensation by the same cost-of-
living adjustment (COLA) payable to Social Security recipients. 
Because the COLA authorized by the bill is assumed in the 
budget resolution baseline, the bill have no budgetary effect 
relative to the baseline. Relative to current law, CBO 
estimates that enacting this bill would increase spending for 
these programs by about $349 million in 2001 and $465 million a 
year thereafter.
    Because H.R. 4850 would affect direct spending, pay-as-you-
go procedures would apply. H.R. 4850 contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act (UMRA) and would impose no costs 
on state, local, or tribal governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 4850 is shown in the following table. 
The costs of the bill fall within budget function 700 (veterans 
benefits and services).

----------------------------------------------------------------------------------------------------------------
                                                                   By fiscal year, in millions of dollars--
                                                           -----------------------------------------------------
                                                              2000     2001     2002     2003     2004     2005
----------------------------------------------------------------------------------------------------------------
                                                 DIRECT SPENDING

Spending under current law for disability compensation:
    Estimated budget authority............................   18,893   19,801   20,577   21,279   21,960   24,447
    Estimated outlays.....................................   18,816   19,719   20,505   21,215   21,898   24,377
Proposed changes:
    Estimated budget authority............................        0        1        1        1        1        2
    Estimated outlays.....................................        0        1        1        1        1        2
Spending Under H.R. 4850 for disability compensation
    Estimated budget authority............................   18,893   19,802   20,578   21,280   21,961   24,449
    Estimated outlays.....................................   18,816   19,720   20,506   21,216   21,899   24,379
----------------------------------------------------------------------------------------------------------------

            Direct spending
    The bill has four provisions that would affect direct 
spending.
    Cost of Living Adjustment.--Section 101 would increase the 
amounts paid to veterans for disability compensation and to 
their survivors for dependency and indemnity compensation by 
the same COLA payable to Social Security recipients. The 
increase would take effect on December 1, 2000, and the results 
of the adjustment would be rounded to the next lower dollar.
    The COLA that would be authorized by this bill is assumed 
in the budget resolution baseline, pursuant to section 257 of 
the Balanced Budget and Emergency Deficit Control Act, and 
savings from rounding it down were achieved by the Balanced 
Budget Act of 1997 (Public Law 105-33). As a result, the bill 
would have no budgetary effect relative to the baseline. 
Relative to current law, CBO estimates that enacting this bill 
would increase spending for these programs by about $349 
million in 2001 and $465 million a year thereafter. This 
estimate assumes that the COLA effective on December 1, 2000, 
would be 2.4 percent.
    Disability Benefits for Certain Members of the Reserves.--
Section 201 would extend eligibility for certain veterans' 
benefits to members of the National Guard and the other reserve 
components if they suffer a stroke or heart attack during 
inactive-duty training. (Inactive-duty training generally means 
the training reservists and guardsmen do onweekends.) Under 
current law, guardsmen and reservists who sustain an injury during 
inactive-duty training are eligible for certain veterans' benefits. 
They are not eligible, however, to receive disability compensation for 
a disease condition that is incurred or aggravated during such 
training. H.R. 4850 would require the Department of Veterans Affairs 
(VA) to treat claims for strokes or heart attacks that occur during 
inactive-duty training, or during travel to and from training duty, as 
it would an injury. Reservists or guardsmen who suffer one of those 
conditions would become eligible for various veterans' benefits and 
services. Their survivors would also become eligible for benefits. CBO 
estimates that added annual costs for veterans' entitlements, mainly 
disability compensation, would be less than $500,000 initially and 
would gradually grow to about $2 million by 2010.
    Information about the incidence of heart attack or stroke 
during inactive-duty training is limited. Based on data from 
the Department of Defense (DoD), CBO estimates that each year 
about 10 members of the reserve components would meet the 
requirements for benefits under the bill and that about 200 
individuals would be eligible at the start of 2000. CBO assumes 
that one-fourth of the initial 200 potential beneficiaries 
would apply and receive benefits. We expect that participation 
would be limited for that group for two reasons. First, many of 
those veterans would not apply because they would not become 
aware of any change in benefits. (Participation among newly 
eligible beneficiaries in the future would be nearly 100 
percent.) Second, CBO believes that about 30 percent of the 
individuals covered by the bill already receive disability 
benefits from DoD and would be precluded under current law from 
receiving the VA benefit concurrently. Because CBO expects that 
their annuity from DoD would exceed the benefit from VA, CBO 
does not estimate an additional cost for those people.
    CBO estimates that 23 to 43 survivors would receive a 
benefit each year over the 2001-2010 period, assuming 
participation rates are similar to those for veterans. 
Survivors at the time of enactment would participate at a lower 
rate than survivors in later years.
    Based on data from VA, CBO estimates that the average 
disability payment under the bill for a veteran would be about 
$8,000 a year and that the average benefit for a survivor would 
be about $12,000. Both benefits are assumed to increase by an 
annual cost-of-living adjustment.
    Compensation Related to Radical Mastectomy.--Section 202 
would provide additional disability compensation to veterans 
who suffer a service-connected loss of one or both breast due 
to a mastectomy. Under current law, veterans who lose certain 
body parts or sensory or vocal capabilities because of a 
service-connected condition are entitled to special monthly 
compensation of $76 a month in 2000 for each eligible 
impairment. (Current law does not provide an automatic annual 
cost-of-living adjustment. However, one is usually provided in 
legislation each year, and current law calls for CBO to assume 
an adjustment to the baseline. Consequently, CBO assumes an 
annual adjustment for purposes of this estimate.) H.R. 4850 
would authorize these special payments for veterans who have 
lost one or both breasts due to a radical or modified radical 
mastectomy that is related to a service-connected condition.
    CBO estimates that about 350 veterans are currently 
receiving disability payments for these type of mastectomies, 
and based on data from VA, about 35 new beneficiaries are added 
every year. Over the 2001-2004 period, the new payments would 
cost less than $500,000 annually. From 2005 through 2010, 
annual spending would be over $500,000 but less than $1 
million.
    Servicemembers' Group Life Insurance.--All individuals on 
active duty and members of the National Guard and Selected 
Reserve are currently eligible for Servicemembers' Group Life 
Insurance (SGLI). Enrolled service members pay a monthly 
premium and can opt for coverage up to $200,000. Once 
servicemembers leave the service, they may continue coverage 
under the Veterans' Group Life Insurance program. Section 301 
would extend eligibility for SGLI to certain members of the 
Individual Ready Reserve (IRR).
    Under current law, the Department of Defense may offer 
members of the IRR the option to be placed in a mobilization 
category that makes them eligible to be called to active duty. 
Veterans can remain in this category for up to two years from 
the date they left the service. According to information from 
DoD, about 200 people are in this mobilization category at any 
one time. H.R. 4850 would make the veterans in this 
mobilization category eligible for life insurance under the 
SGLI program. Based on expected mortality among individuals in 
this group and the current size of the program, CBO estimates 
that the cost of this provision would be less than $500,000 a 
year.
            Spending subject to appropriation
    Veterans who have service-connected disabilities are also 
eligible to enroll with a relatively high priority for medical 
care from VA. Section 201 would increase the number of veterans 
eligible for such a priority. Because the number of veterans 
affected by section 201 is small, and not all of them would 
seek medical care from VA, CBO estimates that the costs to VA 
for the added medical care would be insignificant.
    Pay-as-you-go considerations: The Balance Budget and 
Emergency Deficit Control Act sets up pay-as-you-go procedures 
for legislation affecting direct spending or receipts. The net 
changes in outlays that are subject to pay-as-you-go procedures 
are shown in the following table. For the purposes of enforcing 
pay-as-you-go procedures, only the effects in the current year, 
the budget year, and the succeeding four years are counted.

----------------------------------------------------------------------------------------------------------------
                                                          By fiscal year, in millions of dollars--
                                           ---------------------------------------------------------------------
                                             2001   2002   2003   2004   2005   2006   2007   2008   2009   2010
----------------------------------------------------------------------------------------------------------------
Changes in outlays........................      1      1      1      1      2      2      2      2      2      2
Changes in receipts.......................                              Not applicable
----------------------------------------------------------------------------------------------------------------

    Intergovernmental and private-sector impact: H.R. 4850 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would impose no costs on state, local, or 
tribal governments.
    Previous CBO estimate: CBO prepared estimates for three 
bills that contain provisions that are similar or identical to 
provisions in H.R. 4850. On June 23, 2000, CBO prepared a cost 
estimate for H.R. 4131, which contained a provision on COLAs 
comparable to section 101. On April 27, 2000, CBO prepared a 
cost estimate for H.R. 3816, which contained a provision on 
benefits for reservists who stuffer a stoke or heart attack 
during inactive-duty training comparable to section 201 of H.R. 
4850. On April 3, 2000, CBO prepared a cost estimate for H.R. 
3998, which contained a provision for compensation for a 
service-connected loss for one or both breasts comparable to 
section 202 of H.R. 4850. The estimated cost of those three 
bills and the corresponding sections of H.R. 4850 are the same.
    Estimate prepared by: Federal costs: Evan Christman and 
Michelle Patterson; impact on State, local, and tribal 
governments: Susan Sieg Tompkins; impact on the private sector: 
Rachel Schmidt.
    Estimate approved by: Robert A. Sunshine, Assistant 
Director for Budget Analysis.

                     Inflationary Impact Statement

    The enactment of the reported bill would have no 
inflationary impact.

                  Applicability to Legislative Branch

    The reported bill would not be applicable to the 
legislative branch under the Congressional Accountability Act, 
Public Law 104-1, because the bill would only affect certain 
Department of Veterans Affairs benefits recipients.

                     Statement of Federal Mandates

    The reported bill would not establish a federal mandate 
under the Unfunded Mandates Reform Act, Public Law 104-4.

                 Statement of Constitutional Authority

    Pursuant to Article I, section 8 of the U.S. Constitution, 
the reported bill would be authorized by Congress' power ``[T]o 
provide for the common Defense and general Welfare of the 
United States.''

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

TITLE 38, UNITED STATES CODE

           *       *       *       *       *       *       *


PART I--GENERAL PROVISIONS

           *       *       *       *       *       *       *


CHAPTER 1--GENERAL

           *       *       *       *       *       *       *


Sec. 101. Definitions

  For the purposes of this title--
  (1) * * *

           *       *       *       *       *       *       *

  [(24) The term ``active military, naval, or air service'' 
includes active duty, any period of active duty for training 
during which the individual concerned was disabled or died from 
a disease or injury incurred or aggravated in line of duty, and 
any period of inactive duty training during which the 
individual concerned was disabled or died from an injury 
incurred or aggravated in line of duty.]
  (24) The term ``active military, naval, or air service'' 
includes--
          (A) active duty;
          (B) any period of active duty for training during 
        which the individual concerned was disabled or died 
        from a disease or injury incurred or aggravated in line 
        of duty; and
          (C) any period of inactive duty training during which 
        the individual concerned was disabled or died--
                  (i) from an injury incurred or aggravated in 
                line of duty; or
                  (ii) from an acute myocardial infarction, a 
                cardiac arrest, or a cerebrovascular accident 
                occurring during such training.

           *       *       *       *       *       *       *


Sec. 106. Certain service deemed to be active service

  (a) * * *

           *       *       *       *       *       *       *

  (d)(1) For the purposes of this title, any individual--
          [(1)] (A) who, when authorized or required by 
        competent authority, assumes an obligation to perform 
        active duty for training or inactive duty training; and
          [(2)] (B) who is disabled or dies from an injury or 
        covered disease incurred while proceeding directly to 
        or returning directly from such active duty for 
        training or inactive duty training, as the case may be;

shall be deemed to have been on active duty for training or 
inactive duty training, as the case may be, at the time such 
injury or covered disease was incurred.
  (2) In determining whether or not such individual was so 
authorized or required to perform such duty, and whether or not 
such individual was disabled or died from injury or covered 
disease so incurred, the Secretary shall take into account the 
hour on which such individual began so to proceed or to return; 
the hour on which such individual was scheduled to arrive for, 
or on which such individual ceased to perform, such duty; the 
method of travel employed; the itinerary; the manner in which 
the travel was performed; and the immediate cause of disability 
or death.
  (3) Whenever any claim is filed alleging that the claimant is 
entitled to benefits by reason of this subsection, the burden 
of proof shall be on the claimant.
  (4) For purposes of this subsection, the term ``covered 
disease'' means any of the following:
          (A) Acute myocardial infarction.
          (B) A cardiac arrest.
          (C) A cerebrovascular accident.

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PART II--GENERAL BENEFITS

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CHAPTER 11--COMPENSATION FOR SERVICE-CONNECTED DISABILITY OR DEATH

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SUBCHAPTER II--WARTIME DISABILITY COMPENSATION

           *       *       *       *       *       *       *



Sec. 1114. Rates of wartime disability compensation

  For the purposes of section 1110 of this title--
          (a) * * *

           *       *       *       *       *       *       *

          (k) if the veteran, as the result of service-
        connected disability, has suffered the anatomical loss 
        or loss of use of one or more creative organs, or one 
        or both breasts due to a radical mastectomy or modified 
        radical mastectomy, or one foot, or one hand, or both 
        buttocks, or blindness of one eye, having only light 
        perception, or has suffered complete organic aphonia 
        with constant inability to communicate by speech, or 
        deafness of both ears, having absence of air and bone 
        conduction, the rate of compensation therefor shall be 
        $76 per month for each such loss or loss of use 
        independent of any other compensation provided in 
        subsections (a) through (j) or subsection (s) of this 
        section but in no event to exceed $2,533 per month; and 
        in the event the veteran has suffered one or more of 
        the disabilities heretofore specified in this 
        subsection, in addition to the requirement for any of 
        the rates specified in subsections (l) through (n) of 
        this section, the rate of compensation shall be 
        increased by $76 per month for each such loss or loss 
        of use, but in no event to exceed $3,553 per month;

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CHAPTER 19--INSURANCE

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          SUBCHAPTER III--SERVICEMEMBERS' GROUP LIFE INSURANCE


Sec. 1965. Definitions

  For the purpose of this subchapter--
          (1) * * *

           *       *       *       *       *       *       *

          (5) The term ``member'' means--
                  (A) * * *
                  (B) a person who volunteers for assignment to 
                the Ready Reserve of a uniformed service and is 
                assigned to a unit or position in which such 
                person may be required to perform active duty, 
                or active duty for training, and each year will 
                be scheduled to perform at least twelve periods 
                of inactive duty training that is creditable 
                for retirement purposes under chapter 1223 of 
                title 10 (or under chapter 67 of that title as 
                in effect before the effective date of the 
                Reserve Officer Personnel Management Act); 
                [and]
                  (C) a person who volunteers for assignment to 
                a mobilization category in the Individual Ready 
                Reserve, as defined in section 12304(i)(1) of 
                title 10; and
                  [(C)] (D) a member, cadet, or midshipman of 
                the Reserve Officers Training Corps while 
                attending field training or practice cruises.

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Sec. 1967. Persons insured; amount

  (a) Any policy of insurance purchased by the Secretary under 
section 1966 of this title shall automatically insure against 
death--
          (1)  * * *
          (2) any member of the Ready Reserve of a uniformed 
        service who meets the qualifications set forth in 
        [section 1965(5)(B) of this title] subparagraphs (B) or 
        (C) of section 1965(5) of this title;

in the amount of $200,000, unless such member elects in writing 
(A) not to be insured under this subchapter, or (B) to be 
insured in an amount less than $200,000 that is evenly 
divisible by $10,000. The insurance shall be effective the 
first day of active duty or active duty for training, or the 
beginning of a period of inactive duty training scheduled in 
advance by competent authority, or the first day a member of 
the Ready Reserve meets the qualifications set forth in 
[section 1965(5)(B) of this title] subparagraphs (B) or (C) of 
section 1965(5) of this title, or the date certified by the 
Secretary to the Secretary concerned as the date 
Servicemembers' Group Life Insurance under this subchapter for 
the class or group concerned takes effect, whichever is the 
later date.

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Sec. 1968. Duration and termination of coverage; conversion

  (a) Each policy purchased under this subchapter shall contain 
a provision, in terms approved by the Secretary, to the effect 
that any insurance thereunder on any member of the uniformed 
services, unless discontinued or reduced upon the written 
request of the insured (or discontinued pursuant to section 
1969(a)(2)(B) of this title), shall continue in effect while 
the member is on active duty, active duty for training, or 
inactive duty training scheduled in advance by competent 
authority during the period thereof, or while the member meets 
the qualifications set forth in [section 1965(5)(B) of this 
title] subparagraphs (B) or (C) of section 1965(5) of this 
title, and such insurance shall cease--
          (1) * * *

           *       *       *       *       *       *       *

          (4) with respect to a member of the Ready Reserve of 
        a uniformed service who meets the qualifications set 
        forth in [section 1965(5)(B) of this title] 
        subparagraphs (B) or (C) of section 1965(5) of this 
        title, 120 days after separation or release from such 
        assignment, unless on the date of such separation or 
        release the member is totally disabled, under criteria 
        established by the Secretary, in which event the 
        insurance shall cease one year after the date of 
        separation or release from such assignment, or on the 
        date the insured ceases to be totally disabled, 
        whichever is the earlier date, but in no event before 
        the end of 120 days after separation or release from 
        such assignment.

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Sec. 1969. Deductions; payment; investment; expenses

  (a)(1) * * *
  (2)(A) During any month in which a member is assigned to the 
Ready Reserve of a uniformed service under conditions which 
meet the qualifications of [section 1965(5)(B) of this title] 
subparagraphs (B) or (C) of section 1965(5) of this title, or 
is assigned to the Retired Reserve and meets the qualifications 
of section 1965(5)(D) of this title, and is insured under a 
policy of insurance purchased by the Secretary, under section 
1966 of this title, there shall be contributed from the 
appropriation made for active duty pay of the uniformed service 
concerned an amount determined by the Secretary (which shall be 
the same for all such members) as the share of the cost 
attributable to insuring such member under this policy, less 
any costs traceable to the extra hazards of such duty in the 
uniformed services. Any amounts so contributed on behalf of any 
individual shall be collected by the Secretary concerned from 
such individual (by deduction from pay or otherwise) and shall 
be credited to the appropriation from which such contribution 
was made.

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