GI Bill reboot: Upcoming changes simplify the process, but new caps could cut your benefits - Army News | News from Afghanistan & Iraq - Army Times

GI Bill reboot: Upcoming changes simplify the process, but new caps could cut your benefits

GI Bill 2.0 starts Aug. 1 with sweeping improvements to help thousands of current and former troops — and some of their families — earn college degrees.

That’s the first of two coming waves of changes and it includes full in-state tuition for eligible students, reimbursement for key entrance exams and more money for disabled vets.

The second wave, starting Oct. 1, includes paying the monthly living stipend to online students, adding vocational programs to the list of covered courses, and making active-duty members and their spouses eligible for the monthly book allowance.

The Post-9/11 GI Bill, just two years old, already has served more than 500,000 veterans at a cost of $11.4 billion.

But the coming changes are not all good news; some users will feel a sting.

In a time of budget constraints, the congressionally approved package is cost-neutral, so for every dollar spent helping someone, a dollar is taken from someone else.

The final package, signed into law in January with a delayed effective date, tilts a bit to the bad side of neutral, from a funding perspective. The nonpartisan Congressional Budget Office, which puts a price tag on changes, says the final bill will save the government $734 million over the next decade.

Thousands of active-duty people — mostly officers combining the GI Bill with tuition assistance to pay for graduate education — already are feeling the downward tilt.

In March, the first pains were felt by thousands of active-duty members and some of their spouses when a loophole closed that had allowed reimbursement of full tuition even if the member had not served long enough to earn full benefits.

In one sense, however, everyone is a winner under the Aug. 1 changes because the revised program is easier for students to understand and easier for the Veterans Affairs Department to run, said Robert Norton, an education policy expert with the Military Officers Association of America.

The simplified process sets a worldwide reimbursement limit for private and foreign schools while pledging to pay the full in-state tuition of students at public colleges and universities. This allows VA to process benefits more easily and makes the process more transparent for students, said Keith Wilson, VA’s education service chief, who oversees the GI Bill.

Making it simpler

“We are expanding the benefit, simplifying the fee structure, simplifying its administration and making the benefit uniform across the nation. Those are good things,” said Marco Reininger, a GI Bill expert for Iraq and Afghanistan Veterans of America who attends Columbia University on the Post-9/11 GI Bill.

But complaints are likely to be heard in December when one adverse change kicks in — a halt to education benefits between terms. The end to so-called “interval payments” will affect about 260,000 people a year who will lose an average of $865 each, according to an estimate from the Congressional Budget Office.

The end of interval payments applies not just to the Post-9/11 GI Bill but to all veterans education programs, a move that will save $2 billion over 10 years.

VA officials are trying to get the word to students about the end of between-term payments, but they still expect complaints during the holiday break between the fall and spring terms, when the change will be fully felt.

Eliminating state caps

Doing away with state-by-state tuition and fee caps based on costs at the most expensive four-year public college or university in a state is a change with wide implications — mostly good, but with some negative twists.

One plus: In-state students using the Post-9/11 GI Bill for undergraduate, graduate and doctoral programs will have full tuition and fees paid if they have earned full benefits based on 36 months of aggregate service since Sept. 11, 2001, or 30 consecutive days of service if discharged with a service-connected disability.

The new nationwide rate also is good news for most private school students, because $17,500 is equal to or higher than the 2010-11 fee caps in 43 states. That means many students will receive the same — and perhaps higher — tuition and fee payments.

Two groups of people could be hurt, though Congress is working on legislation to soften the blow:

• About 30,000 students at private schools in Arizona, Michigan, New Hampshire, New York, Pennsylvania, South Carolina and Texas — states where the new $17,500 cap is lower than what was paid last year — face individual losses of as much as $8,900 in benefits, CBO estimates.

The House has passed and the Senate is considering legislation that would grandfather the tuition and fees at 2010-11 rates for people enrolled in private schools before the change was made.

Rules for tuition and fee payments are roughly the same in both bills, said congressional aides, but the House bill would apply to anyone enrolled in a private school as of April 1.

The Senate bill, passed June 30 by the Senate Veterans’ Affairs Committee, would protect only those enrolled in a private school as of Jan. 1. Differences must be worked out before a final bill passes; it is unclear if this will happen by Aug. 1.

• Students using the Post-9/11 GI bill to attend public schools and paying nonresident rates may not even realize yet that they will be hurt.

Previously, they were treated like private school students, with coverage of tuition and fees based on the highest fee for in-state undergrads at a four-year public institution in the state. Now, they will get only the in-state rate for the school they attend.

Some student veterans expected to receive up to $17,500 — just like private school students — but after studying the package of changes, VA officials said July 1 there is no authority to make those payments.

Reininger said he expects some students will be surprised by the change, and some may be forced to drop out of school if they can’t find alternate funding.

“They need to look now for third-party funding, scholarships or grants, so they don’t get into financial distress,” he said.

Many schools, both public and private, participate in the Yellow Ribbon Program, a GI Bill option under which VA matches, dollar-for-dollar, any reduction in tuition and fees made by an institution of higher learning.

Yellow Ribbon benefits could help private and public school students whose total costs are not covered by basic benefits, but fall application deadlines may have passed for some schools.

Steve Westerfield, a spokesman for VA, said 2,466 public and private schools have agreements with VA for the Yellow Ribbon Program in the 2011-12 school year. A list is available at VA’s GI Bill website.

No claims delays

One problem that isn’t expected for the fall term is delays in processing benefits.

Wilson, VA’s education service chief, said a new, fully automated benefits processing system was deployed in early June to handle claims and payments with less fuss than in the past.

Officials already are processing claims for the fall term, Wilson said.

One wrinkle that could slow some claims could emerge if Congress passes relief for private school students. This will require claims to be hand-processed because software cannot be updated in time, Wilson said.

To ease the impact, efforts will be made to limit delays only to private school claims from the states where reimbursement limits will drop, Wilson said.

Hand-processing is required to ensure a student qualifies, particularly if the student is enrolled in the school on whatever date Congress decides is needed for eligibility.