VA's health care enrollment system sorts every enrolled veteran into one of eight priority groups. The group decides two things: how quickly VA must enroll you when capacity is limited, and which copays you pay. Priority Group 5 is the group for veterans who did not earn their way in through a compensable service-connected rating but who cannot be expected to pay for care themselves. It is defined in 38 CFR 17.36(b)(5), which points to the test in 38 U.S.C. 1722(a).
Who is placed in Priority Group 5
38 CFR 17.36(b)(5) places in Group 5 any veteran not covered by Groups 1 through 4 who is "determined to be unable to defray the expenses of necessary care under 38 U.S.C. 1722(a)." Section 1722(a) then deems a veteran unable to defray those expenses if any one of three things is true:
- The veteran is eligible for Medicaid (medical assistance under a state plan approved under title XIX of the Social Security Act).
- The veteran is in receipt of VA pension under 38 U.S.C. 1521 (the needs-based benefit for wartime veterans, not disability compensation).
- The veteran's attributable income is not greater than the income threshold in 1722(b), which VA adjusts each year and by number of dependents. This is the route for most Group 5 veterans, including veterans with a noncompensable (0 percent) service-connected rating whose income is under the limit.
The income threshold is the national income limit VA publishes each year, adjusted for the number of dependents. Since 2003 VA has also applied a geographic threshold based on HUD low-income limits for the veteran's county; a veteran above the national limit but below the geographic limit is placed in Priority Group 7 rather than 5, and a veteran above both limits who enrolled before the 2003 enrollment restriction, or who otherwise qualifies, is Priority Group 8. Groups 7 and 8 pay the full copay schedule, which is why the Group 5 line matters.
What Priority Group 5 costs
Copays are set by regulation, not by the medical center.
- Inpatient and outpatient care: veterans whose income is below the threshold in 38 U.S.C. 1722 are exempt from the inpatient and outpatient copays in 38 CFR 17.108. That exemption is the practical meaning of Group 5 for most veterans: primary care, specialty care and hospital stays without a bill.
- Medications: the medication copay in 38 CFR 17.110 is a separate rule with its own exemptions in paragraph (c). Medication is exempt for a veteran rated 50 percent or more (or paid at that rate for unemployability), for any service-connected disability, and for a veteran whose annual income does not exceed the maximum annual rate of VA pension. Because pension is payable only when income is below that maximum rate, a veteran actually receiving pension falls inside the income exemption. A Group 5 veteran whose income sits above the maximum pension rate but below the health care income threshold still pays the tiered copay for medications that are not for a service-connected condition: under the current text of 38 CFR 17.110(b), $5 for a 30-day supply of a Tier 1 medication, $8 for Tier 2 and $11 for Tier 3, with total medication copays capped at $700 per calendar year. VA changes these amounts by rulemaking, so check the section for the figure in force.
- Care for a service-connected condition is never subject to copays, in any group.
The annual financial assessment
Group 5 placement based on income is not permanent. VA runs a financial assessment (historically called the means test) using the household's gross income, net worth and deductible medical expenses from the prior calendar year, and may verify the reported figures against IRS and Social Security Administration records. A veteran whose income changes can update the assessment with VA Form 10-10EZR, the Health Benefits Update Form. If income rises above the threshold, the veteran moves to Group 7 or 8 and copays begin; if it falls, the veteran can ask to be reassessed and moved back.
Two details catch people. First, VA counts household income, which includes a spouse's income and, in some cases, dependent children's. Second, deductible medical expenses paid out of pocket reduce countable income, so a household with large medical bills may qualify even with income that looks too high on paper.
Pension and Medicaid routes in
A veteran who receives VA pension is placed in Group 5 regardless of the health care income threshold, and the pension itself also carries the medication copay exemption. Medicaid eligibility is a separate route: a veteran who is eligible for Medicaid is Group 5 even if VA's own income test would not place them there. Both routes require VA to see the status, so a veteran newly approved for pension or Medicaid should notify the enrollment office rather than wait for the next assessment.
How Group 5 interacts with a later disability rating
A compensable service-connected rating moves a veteran up under 38 CFR 17.36(b): 10 or 20 percent to Group 3, 30 or 40 percent to Group 2, and 50 percent or more (or a total rating based on individual unemployability) to Group 1. That is why veterans in Group 5 who believe a condition is service connected should still file a compensation claim; the rating, not the income, then controls the group, and a 50 percent rating removes medication copays entirely under 38 CFR 17.110(c).
What to check on your own record
- Your current priority group appears on your VA health care enrollment letter and in the VA.gov profile.
- If you receive VA pension or Medicaid and the record shows Group 7 or 8, ask the enrollment office to correct it.
- If you were assessed on a high-income year and your income has since dropped, file VA Form 10-10EZR rather than waiting.