What is Co-Managed Care for Veterans?

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Active Duty Cost-of Living Allowance (COLA)

Active Duty Cost of Living Allowance (COLA) is an amount that is added to your pay every year if you are stationed in an area that has a high cost of living. The COLA Pay is added onto to your Regular Pay to help compensate for the differences in the costs of living among the 50 continental United States. If you are stationed in Hawaii, Alaska or Puerto Rico you will receive a different type of COLA called OCONUS. COLA is also separate from the Basic Housing Allowance (BAH). COLA is given to any service member or dependent who is required by duty to live in a high cost of living area (referred to as CONUS). COLA is often called CONUS COLA. These areas are determined yearly. Some locations are always on the list and some locations seem to be added and then removed arbitrarily. This isn’t actually the case. A Committee within the Defense Manpower Data Center examines economic data approximately every three years and determines CONUS locations and COLA rates. COLA rates are taxable income but average taxes are factored into the COLA rates.

COLA rates are based on these factors:

  • Duty Station location
  • Cost of living, including access to military exchanges and commissaries
  • Pay grade
  • Years in service
  • Dependents or no dependents

COLA eligibility is pretty straightforward. If you are stationed at a duty location that is on the CONUS list you will receive COLA. In addition, if you are sent overseas on an unaccompanied mission and your dependent lives back in a COLA area next to your Primary Duty Station, you will still receive COLA. Navy personnel are often in this situation.

Although COLA helps, sometimes it doesn’t seem to compensate for the differences in the costs of living from one location to another. It is always a good idea to talk to other military personnel whenever you are faced with a move so that you can determine how the benefits add up on the ground at your new duty station. This will help you and your family to budget accordingly and make the best of your move and your new location.

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