Military Advantage

Why Is Voc Rehab Blocking Veteran Entrepreneurship?

Voc Rehab has amazing resources available to veterans where self-employment is a feasible goal, but rumors are circling the nation that the program is discouraging entrepreneurship.

Counselors are now telling veterans that self-employment programs get stonewalled by DC bureaucrats – taking months without getting a response.

One veteran recently reported:

Update on self-employment. Today, I called my counselor to ask her what’s up rather than emailing. My question was “It’s going on 7 months, what is up with D.C.?” Her response “They are sitting on it. My speculation is they are considering removing self-employment from Voc Rehab all together because it isn’t effective. You could continue and present the entire business plan to the, but the downside is you may do it all for nothing."

Pamphlets encouraging entrepreneurship are no longer in many Voc Rehab offices. Veterans are hitting solid bureaucratic roadblocks. So what happened?

I consulted the House Committee on Veterans Affairs for feedback last spring and again this fall. Committee staff stated Voc Rehab denied my claim that it cut off self-employment. However, representatives of the program did not indicate if they were changing entitlement criteria. Yet, numerous counselors claim self-employment is now restricted to only the most disabled veterans, which in turn are generally too disabled to successfully manage a small business.

Last winter, any veteran could walk into any Voc Rehab office and see mountains of pamphlets about self-employment, franchise options, and various other resources disabled veterans. Voc Rehab boasts one of the most powerful tool belts in the Secretary’s arsenal when it comes to helping veterans retrain for employment when their disability serves as a barrier to any career for which they currently have training. Now, Voc Rehab counselors strongly discourage the goal, referred to as Track 5, for fear that it will get hung up in DC and not receive a timely response.



For a little history, any reader need not look further than just 4 years ago. This was a time when Voc Rehab was blooming with possibility, and VA decided to really push self-employment. This makes sense since veteran owned businesses are the leading employer of veterans across the country.

In 2010, then Chief of Staff John Gingrich announced through the Federal Register that VA relaxed the regulations so that all disabled veterans in the program could be considered for self-employment where such a goal was feasible.


Prior to 2010, only veterans unable to pursue normal channels of suitable employment due to disability and other circumstances were able to use VRE self-employment. In 2010, VA changed the wording of its interpretation because the previous version was too restrictive and vague. The new language conveyed that all program participants can utilize self-employment services for employment when vocational success can be suitably achieved with such services. This changed removed the requirement that all viable employment options be eliminated prior to being entitled to such services.


38 CFR 21.257 PRE-FEBRUARY 18, 2010 CHANGE

The old regulation stated self-employment services were an option only “if the veteran’s access to the normal channels for suitable employment in the public or private sector is limited because of his or her disability or other circumstances in the veterans’ situation warrant consideration of self-employment as an option.”

Luckily, the old version no longer applies.


38 CFR 21.257 POST-FEBRUARY 18, 2010 CHANGE

The new regulation provides that all VR&E veterans’ vocational goals may include self-employment services if such a goal is suitable, “A program of vocational rehabilitation benefits and services may include self-employment for an individual if VA determines that such an objective is a suitable vocational goal.” 38 CFR 21.257(a). The regulation then delineates between disabled veterans who have the “most severe service-connected disabilities” (Category I) and all other disabled veterans (Category II). This “most severe” condition is defined in the regulation as “so severe as to necessitate selection of self-employment as the only reasonably feasible vocational goal for the individuals.” 38 CFR 21.257(b). A feasibility plan must be conducted prior to authorization any rehabilitation plan leading to self-employment. 38 CFR 21.257(f).

The first group, Category I, would be eligible for additional assistance outlined in 38 CFR 21.214 due to the severity of the disabilities. Otherwise, both Category I and Category II veterans (basically all VRE participants) where self-employment is suitable would receive: 1) Vocational training; 2) Incidental training in the management of a business; 3) License or other fees require for self-employment; 4) Necessary tools and supplies for the occupation; and, 5) Job development and placement services.

On April 28, 2009, then Dept. of Veterans Affairs Chief of Staff John Gingrich published VA’s intent for changing the rule in the Federal Register in light of preexisting ambiguities. Agency intent was to correct erroneous interpretations of the law by removing overly restrictive and vague language regarding limitation based on disability to “only available to an individual if access to the normal channels for suitable employment is limited by his or her disability(ies), or other circumstances…” 74 FR 19164-01.

The new regulation clarified VA’s intent that self-employment “is authorized for all program participants for whom it is determined to be appropriate for achieving rehabilitation.” (emphasis added) 74 FR 19164-01.

On January 20, 2010, the change was made to the regulation effective February 19, 2010 for all claims pending on that day and future claims. Chief of Staff Gingrich reiterated that all program participants are eligible, “Self-employment as a mode of employment is authorized for all program participants for whom it is deemed appropriate for achieving rehabilitation.” 75 FR 3168-01.

This regulation changed in 2010 to allow all VRE participants to use self-employment services when self-employment is a suitable vocational goal rather than only as a last resort for just the most severely disabled veterans. 38 CFR § 21.257(d).

In 2010, VA published its more lenient regulatory language concerning self-employment. In the Federal Register, then VA Chief of Staff John Gingrich stated the intent of VA was to remove overly restrictive language to allow all VRE participants where self-employment services are appropriate to receive such services:

“We are amending the criteria for approval of self-employment as a vocational goal for an individual. Current § 21.257(a) is overly restrictive because it maintains that self employment is only available to an individual if access to the normal channels for suitable employment is limited by his or her disability(ies). Current § 21.257(b) is vague because it does not specify what other circumstances in the individual’s situation warrant consideration of self-employment. Self-employment as a mode of employment is authorized for all program participants for whom it is deemed appropriate for achieving rehabilitation.”
First, this language shows the change was intended to stop the practice of improperly restricting access to self-employment. This restriction was based on the erroneous presumption by VRE that a veteran can only use self-employment services if there exist no other reasonably feasible vocational options. Instead, Mr. Gingrich indicates all VRE participants can use self-employment so long as it is appropriate.



Some of you may be wondering why Voc Rehab is hating on entrepreneurial disabled veterans in light of such a recent change. You are not alone. I just asked the House Committee to provide new clarification after hearing reports this fall that the same push against self-employment persisted. I will report back once I know more.

In the mean time, plan on checking in here to find out strategies in how to work around this issue.


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Voc Rehab Survival GuideBenjamin Krause is an award winning investigative journalist, attorney, and disabled veteran of the US Air Force, where he served in its Special Operations Command. He wrote his guide, the Voc Rehab Survival Guide for Veterans, after winning his long fight for benefits against VA to help other veterans do the same. Benjamin is a graduate of Northwestern University and the University of Minnesota Law School using VA Vocational Rehabilitation.

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