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Committee advances bill to restrict upfront fees for third-party veterans disability representation
Summary
A bill to limit fees charged by private third parties who help veterans secure disability benefits was reported out after extended debate over contingency fees, veterans' choice and how VA benefit increases are calculated.
Representative Doyle presented House Bill 28 36, which he described as establishing a framework "to protect veterans from predator predatory third parties helping them with their veteran disability benefits." The bill would require compensation to those third-party representatives to be contingent on an increase in the veteran’s benefits and limit the contingency to a multiple of the monthly increase.
"I'm really asking for the how does the VA math work there on this increase if we're gonna allow private entities to compensate some? How does the VA increase work with the the increase work with the VA math?" Representative Bill de Brandt asked, seeking clarification about how the bill's payment cap would operate given how the Department of Veterans Affairs calculates ratings.
Doyle explained the bill’s mechanism with a numeric example: if a veteran’s benefit rose by $500 a month after representation, the third-party contractor could receive up to five times that monthly increase as compensation. "If there's no increase with this bill, then the veteran can't be taken advantage of. There's no payment made," he said.
Opponents argued the bill could restrict veterans’ access to private providers that charge upfront fees but often claim high rates of favorable outcomes. Representative Hildebrandt, urging a no vote, said the bill would "limit individual choice" and "rather than exploiting their finances, it's now exploiting their health," arguing that some veterans rely on paid providers to secure meaningful benefits.
Supporters replied that regulation protects veterans from unscrupulous actors and creates a clearer marketplace: "If you're a good actor within that industry, you should welcome regulation so that you don't have the state or the feds coming down and over regulating you," Representative Doyle said in debate.
Committee members also questioned whether the contingency-based cap would provide adequate compensation for contractors who perform time-consuming work, and whether it would disincentivize representation in marginal cases. The sponsor said veterans would retain access to free Veterans Service Organizations (VSOs) and to private actors; the bill focused on limiting contingency structures that can leave veterans out-of-pocket when outcomes are poor.
The committee voted to report the bill as do pass with 11 yeas and 3 nays. Opponents said they would seek an opt-out amendment or further changes on the floor.
Ending: The sponsor and opponents signaled willingness to work on clarifying language; the committee moved the bill to the next stage with instructions that members may pursue amendments to preserve veterans’ choice while preventing predatory fee structures.
