There was email was written in March by Norma Perez, Ph.D., a V.A. psychologist who coordinates post-traumatic stress disorder cases.
She wrote, "Given that we are having more and more compensation-seeking veterans, I'd like to suggest that you refrain from giving a diagnosis of PTSD straight out. Consider a diagnosis of adjustment disorder."
The email was discovered by accident through a Freedom of Information request by a veterans group.
"It is a very damning email. Cut off the money, disguise them with adjustment disorders so they don't get V.A. benefits," said Gordon Erspamer, a Veterans Groups' Lawyer.
Attorneys for Veteran's groups suing the V.A. say the email supports their case that the dept has failed to diagnose and treat PTSD and other mental health problems.
Their lawsuit asks the court to force the V.A. to treat veterans who show signs of PTSD and are at risk of suicide.
The V.A. says the email's author admits it was poorly worded and has no bearing on the lawsuit.
"I think she made it clear she had mistakes. The secretary has disciplined her and also said she doesn't reflect any V.A. policies," said Kerri Childress, a Veterans Administration spokesperson.
This is the second email that the veterans say the V.A. has tried to conceal from the public.
The first surfaced during the trial that ended last month. The V.A.'s Mental Health Director Dr. Ira Katz, M.D. wrote that there were 1,000 suicide attempts a month among veterans.
Katz said, "Is this something we should address ourselves in some sort of release before someone stumbles on it?"
"The first one says lets cover the 1,000 suicide attempts per month and the second one says lets deny benefits," said Sid Wolinsky, a Veterans Groups' Lawyer.
Federal Judge Samuel Conti granted the veterans groups request to enter the email as evidence even though the non-jury trial ended last month. He's expected to rule on the lawsuit any day now.