As the United States prepares to observe Independence Day, some veterans groups are clashing with the Bush administration over health benefits for Americans who have served in the country’s military.

The veterans groups say the U.S. Department of Veterans Affairs should provide health benefits for all veterans.

“Taking care of veterans is a continuing cost of war,” Rep. Robert Filner, D-Calif., chairman of the House Veterans’ Affairs Committee, said at a recent hearing on veterans’ health benefits, according to a written version of his remarks. “All veterans should have access to ‘their’ health care system.”

VA officials said limited funding makes restricting coverage for “Priority Group 8″ veterans – relatively high-income veterans with no service-related disabilities – a necessary evil.

“We believe the current restriction on enrollment of new Priority Group 8 veterans is necessary to maintain the timeliness and quality of the health care we provide to currently enrolled veterans,” Michael Kussman, a VA official, testified at the hearing.

In the early 1990s, the VA health system shut out most veterans who had no service-related disabilities.

The Veterans Health Care Eligibility Reform Act of 1996 created priority groups and a patient enrollment system to manage access to VA health care during years when the program lacked enough funds to serve all veterans who needed care.

Later, in 1999, the VA opened health benefits to all veterans, regardless of income, and relatively high-income veterans flocked to sign up.

The Department of Veterans Affairs Health Care Programs Enhancement Act of 2001 set up Priority Group 8. In addition to having no service-related disabilities and no catastrophic disabilities of any kind, Priority Group 8 veterans have incomes exceeding specified limits. For a single veteran, in most of the country, the income limit is $27,790.

The VA health system has excluded most Priority Group 8 veterans since January 2003, but newly returning Priority Group 8 veterans who sign up for VA health benefits within 2 years of becoming eligible still can get the benefits.

Because the VA health system still is accepting newly eligible Priority Group 8 veterans, the Priority Group 8 exclusion has its biggest effect on veterans who served during the Cold War and in the early 1990s during Operation Desert Storm, speakers testified at the House Veterans’ Affairs Committee hearing.

The VA estimates opening the program to the 1.6 million excluded veterans in Priority Group 8 would cost an additional $1.7 billion.

Filner said the Bush administration is responsible for the exclusion.

“The administration fails year after year to request specific funding for enrolling Priority 8 veterans and treats the January 2003 decision as permanent,” Filner said.

Dr. Stephanie Woolhandler, associate professor of medicine at Harvard Medical School, testified at the House Veterans Affairs Committee hearing on health benefits, that 645,628 Vietnam-era veterans are uninsured.

About 8.6 million veterans who served during “other eras,” including the Persian Gulf War, lack health coverage, Woolhandler said.

“Many uninsured veterans have serious illnesses requiring extensive care,” Woolhandler said. “More than a quarter of uninsured veterans failed to get needed care due to costs.”

Adrian Atizado, a staff member at Disabled American Veterans, Cold Spring, Ky., testified at the hearing that the DAV objects to the different rules governing newly eligible veterans and other veterans.

“This kind of differentiation between classes of veterans sets the stage for a ’2-tiered health care system, one that provides ready access to the newest veterans, but may deny access to older ones,” Atizado said. “Disabled American Veterans is very troubled by this inequity.”

Carl Blake, who spoke for the Paralyzed Veterans of America, Washington, also criticized the decision to set different rules for newly eligible veterans and other veterans.

“This is wholly unfair to any other veteran who would qualify for enrollment in Category 8 and whose service was no less important,” Blake said.

Kussman, the VA official, said the current approach is working well.

“This policy allows [the] VA to focus on fulfilling its mission to meeting the health care needs of those veterans given higher priority by Congress,” Kussman said.