The income restriction is $41,000 (ish), and I was regularly paying for many of my medical supplies, especially my CPAP stuff. All totally, my medical expenses were to the tune of about $3,000 - $4,000 annually. Take that amount from the $41,000 and I fell well below the limit. And no, I had no other income other than my government salary, and I live alone.
$41K is the limit for no copays. (drug copays yes, but other copays no)
You can still be enrolled with VA healthcare, WITH copays, up to about $69K.
We could track down how you blew past $41K to get denied. Some possibilities . . . Yes, if you paid personally for CPAP, medical costs do reduce income.
One item I have seen ... if you sold an investment, this gets reported to the VA and total sales price is VA INCOME. But only if you do not send them the details on the original purchase price.
Meaning, sales price is income if the VA has not been provided purchase price, which they do not get from the IRS. you have to proactive do that yourself.