The same law that gave troops a 3.8% pay raise also cut food assistance for 1.2 million veterans, gutted the CFPB office that protects service members from predatory lenders, and put 724,000 TRICARE beneficiaries at risk through Medicaid hospital cuts. Here is the full picture.
When Congress passed the 'One Big Beautiful Bill' in July 2025, supporters pointed to its military provisions as proof of commitment to veterans and service members. The law did include real benefits: a 3.8% pay raise for active-duty troops, a $10,000 increase in the Basic Housing Allowance cap, and $150 billion in new defense spending. But buried in the same 1,100-page law were provisions that cut food assistance, weakened consumer protections, and reduced health coverage for the very people the military pay raise was meant to honor.
Approximately 1.2 million veterans rely on SNAP (food assistance) to feed their families. The One Big Beautiful Bill reinstated and expanded SNAP work requirements, adding new documentation burdens and reducing the income threshold for eligibility. The Military Family Advisory Network (MFAN) — a nonpartisan organization that surveys active-duty and veteran families — found that 25% of military families reported food insecurity in 2024. The new SNAP restrictions make it harder for veterans with service-connected disabilities, caregiving responsibilities, or unstable employment to maintain their benefits.
"The law that gave troops a pay raise also made it harder for veteran families to put food on the table. These are not separate issues — they are the same families."
— Military Family Advisory Network — 'Big Beautiful Bill Is Now Law: Here's What It Means for Military Families' (July 2025) ↗
Here is a specific, concrete way the law harms military families that almost no one is talking about. Basic Allowance for Housing (BAH) — the monthly payment the military gives service members to cover rent — counts as income for SNAP eligibility purposes. But it does not count as income for the Child Tax Credit. This means a military family living in an expensive city, receiving a large BAH to cover their rent, may be disqualified from SNAP because their 'income' looks too high — even though that BAH goes entirely to rent and leaves them with less disposable income than a civilian family earning the same base salary. The law did not fix this inequity.
| Benefit | BAH Counted as Income? | Effect on Military Families |
|---|---|---|
| SNAP (food assistance) | YES — counts against eligibility | Families disqualified despite real food insecurity |
| Child Tax Credit | NO — excluded from calculation | Families miss out on up to $2,000 per child |
| Medicaid | YES in most states | Families pushed above income threshold, lose health coverage |
| LIHEAP (energy assistance) | Varies by state | Some families lose heating/cooling help due to BAH |
The Consumer Financial Protection Bureau (CFPB) has a dedicated Office of Servicemember Affairs (OSA) — created specifically to protect active-duty troops and veterans from predatory lending, illegal debt collection, and financial fraud. In early 2026, as part of the broader DOGE-driven federal workforce reductions, the CFPB's OSA was reduced to a skeleton staff. The office that had recovered more than $130 million for military families since 2011 — through enforcement actions against payday lenders, auto dealers, and mortgage servicers targeting service members — was effectively shut down.
The timing matters. Veterans and active-duty service members are among the most targeted demographics for predatory financial products. The Military Lending Act caps interest rates at 36% for active-duty borrowers — but enforcement of that cap depends on the CFPB. Without an active OSA, complaints from service members go unprocessed, investigations stall, and predatory lenders face no consequences. The CFPB's own data showed that servicemember complaints about financial products rose 18% in 2025 — the same year the office was gutted.
A March 2026 study by Harvard School of Public Health, reported by ABC News, found that approximately 724,000 TRICARE beneficiaries — active-duty family members and veterans — rely on civilian hospitals for care. Those civilian hospitals depend heavily on Medicaid reimbursements to stay financially viable. As Medicaid cuts reduce hospital revenue, rural and community hospitals face closure or service reductions. When those hospitals close, TRICARE beneficiaries lose access to the civilian providers they depend on — especially in rural areas where the nearest VA facility may be hours away.