The Civil War created thousands of newly disabled people who needed long term care and beneficiaries for veterans benefits of all kinds. The Civil War involved 2.8 million men, about 10% of the entire population of the country, compared to the 300,000 men involved in the Revolutionary War. Hundreds of thousands of wives, children, and elderly parents lost the family breadwinner in the Civil War, either because he died, or because he ended up disabled and unable to work.
Because of the devastating impact of the war, veterans benefits were expanded during and after the war, first to stimulate recruitment, and later to avoid sending a flood of disabled soldiers and indigent widows to the poorhouses. This expansion in benefits led to what may have been the first instance of fraud and abuse of a federal benefits program. Thousands of profiteers throughout the country encouraged everyone, eligible or not, to sign up for these new benefits. The deluge of claims overwhelmed the Pension Bureau, slowed down claims processing, and added huge, and unexpected, costs to the veterans' pension program. (Atlantic Monthly, 1890)
Cash assistance wasn't enough in some cases. Eventually, the federal government started building hospitals and homes to provide long term care to disabled soldiers and sailors, where many lived into their old age. In spite of the problems and limitations, veterans benefits succeeded in providing a source of income that kept many veterans and their families out of the poorhouse. The cash payments could also be used to help pay for care in other facilities.