A bill to amend title 38, United States Code, to authorize a cost-of-living adjustment in the rates of disability compensation for veterans with service-connected disabilities and dependency and indemnity compensation for the survivors of certain disabled veterans, to make modifications in the veterans home loan guaranty program, to make permanent certain temporary authorities, and for other purposes.

SECTION 1. SHORT TITLE; REFERENCES TO TITLE 38, UNITED STATES CODE; 
              TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Veterans' Benefits 
Act of 2001''.
    (b) References.--Except as otherwise expressly provided, whenever 
in this Act an amendment or repeal is expressed in terms of an 
amendment to, or repeal of, a section or other provision, the reference 
shall be considered to be made to a section or other provision of title 
38, United States Code.
    (c) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; references to title 38, United States Code; table 
                            of contents.
                     TITLE I--COMPENSATION PROGRAM

Sec. 101. Increase in compensation rates and limitations.
Sec. 102. Rounding down of cost-of-living adjustments in compensation 
                            and DIC rates.
                        TITLE II--HOUSING LOANS

Sec. 201. Vendee loan authority.
Sec. 202. Loan fees.
Sec. 203. Procedures on default.
            TITLE III--TEMPORARY AUTHORITIES MADE PERMANENT

Sec. 301. Income verification authority.
Sec. 302. Limitation on pension for certain recipients of medicaid-
                            covered nursing home care.
Sec. 303. Health-care and medication copayments.
Sec. 304. Third-party insurance collections.

                     TITLE I--COMPENSATION PROGRAM

SEC. 101. INCREASE IN COMPENSATION RATES AND LIMITATIONS.

    (a) Rate Adjustment.--The Secretary of Veterans Affairs shall, 
effective on December 1, 2001, increase the dollar amounts in effect 
for the payment of disability compensation and dependency and indemnity 
compensation by the Secretary, as specified in subsection (b).
    (b) Amounts To Be Increased.--The dollar amounts to be increased 
pursuant to subsection (a) are the following:
            (1) Compensation.--Each of the dollar amounts in effect 
        under section 1114 of title 38, United States Code.
            (2) Additional compensation for dependents.--Each of the 
        dollar amounts in effect under section 1115(1) of such title.
            (3) Clothing allowance.--The dollar amount in effect under 
        section 1162 of such title.
            (4) New dic rates.--The dollar amounts in effect under 
        paragraphs (1) and (2) of section 1311(a) of such title.
            (5) Old dic rates.--Each of the dollar amounts in effect 
        under section 1311(a)(3) of such title.
            (6) Additional dic for surviving spouses with minor 
        children.--The dollar amount in effect under section 1311(b) of 
        such title.
            (7) Additional dic for disability.--The dollar amounts in 
        effect under sections 1311(c) and 1311(d) of such title.
            (8) DIC for dependent children.--The dollar amounts in 
        effect under sections 1313(a) and 1314 of such title.
    (c) Determination of Increase.--(1) The increase under subsection 
(a) shall be made in the dollar amounts specified in subsection (b) as 
in effect on November 30, 2001.
    (2) Except as provided in paragraph (3), each such amount shall be 
increased by the same percentage as the percentage by which benefit 
amounts payable under title II of the Social Security Act (42 U.S.C. 
401 et seq.) are increased effective December 1, 2001, as a result of a 
determination under section 215(i) of such Act (42 U.S.C. 415(i)).
    (3) Each dollar amount increased pursuant to paragraph (2) shall, 
if not a whole dollar amount, be rounded down to the next lower whole 
dollar amount.
    (d) Special Rule.--The Secretary may adjust administratively, 
consistent with the increases made under subsection (a), the rates of 
disability compensation payable to persons within the purview of 
section 10 of Public Law 85-857 (72 Stat. 1263) who are not in receipt 
of compensation payable pursuant to chapter 11 of title 38, United 
States Code.
    (e) Publication Requirement.--At the same time as the matters 
specified in section 215(i)(2)(D) of the Social Security Act (42 U.S.C. 
415(i)(2)(D)) are required to be published by reason of a determination 
made under section 215(i) of such Act during fiscal year 2002, the 
Secretary shall publish in the Federal Register the amounts specified 
in subsection (b) as increased under this section.

SEC. 102. ROUNDING DOWN OF COST-OF-LIVING ADJUSTMENTS IN COMPENSATION 
              AND DIC RATES.

    (a) Compensation COLAs.--Section 1104(a) is amended by striking out 
``fiscal years 1998 through 2002.''
    (b) DIC COLAs.--Section 1303(a) is amended by striking out ``fiscal 
years 1998 through 2002.''

                        TITLE II--HOUSING LOANS

SEC. 201. VENDEE LOAN AUTHORITY.

    (a) Termination of Vendee Loan Authority.--Section 3733(a) is 
amended by striking out paragraphs (1) and (2) in their entirety and 
inserting in lieu thereof:
            ``(1) Prior to October 1, 2001, the Secretary may sell real 
        property acquired by the Secretary as the result of a default 
        on a loan guaranteed or made under this chapter with the 
        purchase financed by a loan made by the Secretary.''.
    (b) Internal Revenue Code Amendment.--Section 6103(I)(7)(D) of the 
Internal Revenue Code of 1986, is amended by striking out ``Clause 
(viii) shall not apply after September 30, 2003.''

SEC. 302. LIMITATION ON PENSION FOR CERTAIN RECIPIENTS OF MEDICAID-
              COVERED NURSING HOME CARE.

    Section 5503(f) is amended by striking out paragraph (7).

SEC. 303. HEALTH CARE AND MEDICATION COPAYMENTS.

    (a) Section 1710 is amended by striking out ``before September 30, 
2002,'' in subsection (f)(2)(B).
    (b) Section 1722A is amended by striking out subsection (d).

SEC. 304. THIRD-PARTY INSURANCE COLLECTIONS.

    Section 1729 is amended by striking out ``before October 1, 2002,'' 
in subsection (a)(2)(E).

Summary: Veterans' Benefits Act of 2001 - Directs the Secretary of Veterans Affairs to increase, as of December 1, 2001, the rates of veterans' disability compensation, additional compensation for dependents, the clothing allowance for certain disabled adult children, and dependency and indemnity compensation for surviving spouses and children. Authorizes the Secretary, prior to October 1, 2001, to sell real property acquired as the result of a default on a loan guaranteed or made by the Secretary. Makes permanent: (1) a monthly pension limit for certain veterans receiving Medicaid-covered nursing home care, (2) certain veteran's health care and medication copayment requirements. And (3) the authority for the Department of Veterans Affairs to recover the cost of certain care and services furnished to a veteran in connection with a non-service-connected disability.