Every bill you built around your monthly VA payment now carries a question mark, because the letter in your hand says proposed reduction. The VA cannot lower or sever your rating and notify you after the fact. Federal regulation requires VA to give you written notice and a real opportunity to respond first, under 38 C.F.R. § 3.103, before that decision becomes final. In this episode of Beyond the Rating, VetsForever CEO and Navy veteran Trinidad Aguirre breaks down a new VA Office of Inspector General report that reviewed exactly these cases, and what the report found should change how closely you read your own letter.
Watch: “Beyond the Rating | What the VA’s Own Watchdog Found”
- 0:00: Intro
- 1:10: What the report focused on
- 1:40: Your due process rights
- 2:45: What the Inspector General found
- 5:06: How to review your proposed reduction letter
- 6:19: What you can control
What Counts as an Adverse Action
VA calls it an adverse action any time it takes away something you already have. That covers two different outcomes. A reduction lowers the rating on a condition VA already rated, so your monthly payment goes down. A severance goes further: VA decides the condition is no longer service connected at all, and the payment for it stops.
VA proposes these actions for one of three reasons. VA believes your condition improved. You missed a required VA exam. Or VA decided an earlier rating decision contained what it calls a clear and unmistakable error, shortened to CUE, meaning VA believes it got the facts or the law wrong the first time and that error changed the outcome, under 38 C.F.R. § 3.105.
Your Due Process Rights Under 38 C.F.R. § 3.103
Before VA can act on a proposed reduction or severance, federal regulation requires it to give you real due process first. In practice, that means:
- You get written notice before VA acts, usually called a proposed rating decision or a due process letter.
- You have 60 days from that notice to submit evidence showing why the action should not go forward.
- You can request a hearing to present that evidence or talk through the proposal.
- You have the right to representation.
- Once VA makes its final decision, it has to tell you in writing.
That 60-day window is the one stretch of time where you can put evidence in front of VA before the change takes effect. When you get one of these letters, note the date and keep it somewhere you will see it.
What the VA’s Inspector General Found
The VA Office of Inspector General reviewed proposed reductions and severances that closed in 2024, a total of 27,100 cases. It estimated that 9,300 of those cases, about 34 percent, contained at least one error.
Where the Letters Went Wrong
Four separate error categories show up in the report, but one is the one you can actually catch yourself: the due process letter itself. In an estimated 4,000 cases, the letter had the wrong reason, the wrong dates, or left out your rights entirely. That is the category that matters most to you right now, because it is the one piece of the file you already have in hand.
The report documents one heart condition rated at 100 percent, proposed for reduction to 10 percent over a CUE. The due process letter sent out instead stated the reason was improvement. Reading that letter, you would have gathered the wrong evidence to respond with. Per the report, the underpayment on that file ran roughly $26,600 across 2024 and 2025, with an ongoing monthly underpayment of about $2,200 until the error gets corrected.
The report also found about 2,900 cases where VA used the wrong effective date for the change, sometimes a month or more off in either direction, and a separate 2,900 or so cases where VA did not correctly update the rating history. That history matters later, since it can affect how much back pay you receive if VA later grants something else covering the same period.
In about 1,000 cases, VA proposed a reduction and then never finished it. The file closed early with no final decision ever issued.
Across these errors, the Inspector General estimated at least $16.9 million in improper payments for cases closed in 2024, plus roughly $964,000 in ongoing monthly improper payments until VA resolves them. That number runs in both directions: some payments were too low, some were too high. If yours turns out to be an overpayment, expect VA to come after that money later regardless of how the letter was worded.
VA agreed with every recommendation in the report: a standardized due process letter, a second level of review on CUE decisions, and a new internal report built specifically to catch reductions that were proposed but never finished.
What To Check in Your Own Letter
Pull out your letter and read it against these questions:
- Does it clearly state the reason VA wants to make the change, and does that reason match the rating decision attached to it?
- Does it show the proposed new rating, the new payment amount, and the date the change would take effect?
- Does it tell you whether you might end up with an overpayment?
- Does it explain your right to submit evidence, request a hearing, and have representation?
VA’s own procedure requires all of this in the letter. When one of these is wrong or missing, VA is supposed to send a corrected letter and start the 60-day response period over again from that corrected letter.
A mistake in your letter does not automatically mean the proposed action is wrong, and a corrected letter does not automatically mean the action is right either. What decides the outcome is the evidence about your condition, not the letter’s wording. That is why the 60-day window matters more than how the letter is written.
VetsForever is a veteran-founded organization. We provide legal representation through VA-accredited representatives.
If VA Already Reduced or Severed Your Rating
If you received a proposed reduction or severance letter and want someone to go through it with you, you can request a case review from a VA-accredited representative. If VA already reduced your rating or severed a condition within the last year, VetsForever’s Readout can show you what is in your file and what the decision was based on, typically within 5 to 10 business days.
The Readout provides a summary of findings from your C-file and does not constitute legal advice or claims preparation.
VetsForever’s Readout is an informational product. Results may vary. Veterans are encouraged to consult with a VA-accredited representative or attorney before taking action on their claim. If a veteran subsequently engages VetsForever’s full representation service, $500 of The Readout cost will be credited against the attorney fees on the first invoice VetsForever earns on any past-due benefits (back pay) recovered through that representation, as set forth in VetsForever’s standard fee agreement.
The credit applies only to earned attorney fees; if no back pay is recovered, no attorney fee is charged and the credit does not result in a payment to the veteran.
Frequently Asked Questions
What happens if you miss the 60-day window?
If 60 days pass with no evidence, hearing request, or response on file, VA can go ahead and make the proposed reduction or severance final, under 38 C.F.R. § 3.103. A late response is not automatically ignored, VA has discretion to consider it, but the clean, guaranteed path runs out at day 60. If you are already close to that date, get something in front of VA now rather than waiting to build a stronger case.
Do you need a VA-accredited representative to respond, or can you handle it yourself?
Nothing in 38 C.F.R. § 3.103 requires representation to submit evidence or request a hearing, you can respond on your own. A VA-accredited representative can review the letter against your file and gather the right evidence with you, which matters most when the letter cites a CUE or an exam finding you do not fully understand.
Do you get extra protection if you have held a rating for a long time?
Yes. Ratings held 5 years or more, 10 years or more, and 20 years or more each carry their own additional protection against reduction, under 38 C.F.R. § 3.344, § 3.957, and § 3.951(b) respectively. These are separate from, and stack on top of, the basic due process requirement under § 3.103.
What if VA proposed a reduction and then never finished it?
The Inspector General’s report found about 1,000 cases where VA proposed a reduction or severance and then closed the file without ever issuing a final decision. If that happened on your file, your rating should not have changed. Confirm your current rating and payment amount directly against your most recent award letter, and request a case review if anything looks off.
Can VA still collect an overpayment if its own letter had an error?
Yes. The report found errors ran in both directions, some payments were too low and some were too high. A wrong reason on the letter does not change what VA is owed back. You can dispute the amount or request a waiver, but that runs as a separate process from challenging the rating decision itself.
