Invisible Wounds: How Mental Disability Benefits Shape Veteran Well-Being

We study impacts of VA disability compensation on the health and well-being of the large and rapidly growing population of veterans claiming mental disorders. We leverage quasi-random assignment of veterans to medical examiners with varying assessing tendencies. An additional $1,000 per year decreases food insecurity and homelessness by 4.1 and 1.3 percent over 5 years. Health care utilization increases, with greater engagement in preventive care. We estimate precise null average effects on health and mortality. Those on the margin of claim denial experience worse outcomes on average than other applicants, with suggestive evidence of large treatment effects for this subpopulation. (JEL I12, I31, I38, J14)