Lawmakers across the U.S. push to regulate or ban predatory companies charging veterans exorbitant fees for disability claims assistance.
Michigan Lawmakers Join Push Against Exploitative Claim Consultants
Michigan Advance reports that lawmakers in several states are ramping up efforts to crack down on for-profit companies charging military veterans steep fees to assist with filing disability claims. These companies, often dubbed “claim sharks,” exploit a legal loophole that leaves veterans vulnerable. While federal law prohibits non-accredited entities from charging for such services, no penalties exist to enforce the rule.
This regulatory gray area has fueled a lucrative shadow industry, prompting action from states, including Michigan, to protect veterans from financial exploitation.
Veterans Face Financial Exploitation in Claims Process
For-profit consultants charge veterans thousands of dollars to navigate the complex U.S. Department of Veterans Affairs (VA) disability claims process. Critics argue these fees are unnecessary, as accredited organizations like The American Legion and Veterans of Foreign Wars (VFW) offer similar assistance for free.
Proponents of tighter regulations say the issue is urgent. The passage of the PACT Act in 2022, which expanded disability benefits for veterans exposed to toxins like Agent Orange, created a surge in claims. This surge presents an opportunity for consultants to profit, sometimes charging up to $30,000 for services that accredited entities would provide at no cost.
“When we have organizations and companies out there like these claim sharks that are preying on our veterans and taking away their hard-earned benefits and making a profit off them, there’s something empirically wrong with that,” said Rep. Dave Griffith (R-Missouri), a former Green Beret and Vietnam War veteran who has been an outspoken critic of claim sharks.
Mixed Results in State-Level Legislation
Several states, including Maine, New Jersey, and New York, have passed laws in the past year targeting these for-profit consultants. Michigan lawmakers are considering similar measures. However, efforts to impose penalties on non-accredited consultants have faced stiff opposition, particularly from industry lobbyists.
In Louisiana, a recent law allows consultants to charge fees up to $12,500 for assisting veterans, a move critics decry as legitimizing exploitative practices. Despite opposition, lawmakers like Rep. Anna V. Eskamani (D-Florida) vow to reintroduce bills aimed at protecting veterans from exorbitant fees.
“Veterans are often facing delays with the VA, and I can see why there’s a desire to get results. But these companies sometimes use exploitative practices and seize a big chunk of your benefits,” Eskamani said, urging continued bipartisan efforts.
Industry Defends Practices Amid Scrutiny
Representatives of the for-profit claims consulting industry argue that veterans should have the right to choose their service providers. Peter O’Rourke, president of the National Association for Veteran Rights and a former acting secretary of Veterans Affairs, contends that accredited organizations are overwhelmed and unable to meet demand.
“The key for us is having transparent disclosures, processes and statements of fees so veterans can make informed decisions,” O’Rourke said, emphasizing the need for transparent fee structures and voluntary regulation rather than outright bans. However, veterans’ organizations like the VFW have been vocal opponents, advocating for stronger protections against for-profit consultants.
Broader Context and Next Steps
The VA has issued fraud alerts warning veterans to avoid non-accredited consultants, while organizations like the VFW and American Legion continue to push for federal legislation. The stalled GUARD Act, if passed, would impose penalties on unaccredited consultants nationwide, addressing the legal loophole.
In Michigan, lawmakers are working to balance the need for consumer protection with veterans’ rights to choose their service providers. As legislative sessions begin next year, the debate is expected to intensify.
Find More Interesting Feature Stories From ThumbWind
- Michigan Features: Unveiling the people, places, and events that make the Great Lake State unique, exploring hidden gems and must-do activities.
- Weird Political News: A sarcastic and insightful take on official news from government sources, Political Action Committees, and public officials nationwide.
- Michigan News: News and events from Michigan’s Upper Thumb region worth knowing.
Your Turn – Like This, or Hate it – We Want To Hear From You
Please offer an insightful and thoughtful comment. Idiotic, profane, or threatening comments are removed. Consider sharing this story. Follow us to have other feature stories fill up your Newsbreak feed from ThumbWind Publications.
