If found unfit and rated 30% or more by the PEB, you will receive disability retirement. This includes disability retirement pay and other retirement benefits such as TRICARE . Disability retirement pay is based on your Length of Service (LOS) (2.5% times year or service) or the disability percentage assigned by the PEB, whichever is more beneficial.
Military retirement pay is offset by your VA compensation. In 2003, Congress passed programs to eliminate this offset for certain military retirees. These programs are generally known as concurrent receipt and have been modified a couple of times in the subsequent years. Here are the basics.
Concurrent Receipt of Disability Payments (CRDP) program is available to length of service retirees regardless of years served and disability retirees with at least 20 years service. If these retirees have at least a 50% rating from the VA they receive both their VA and military retirement w/o offset. This program may someday be expanded to disability retirees under 20 as well as to those with VA ratings of less than 50%.
Combat Related Special Compensation (CRSC) is available to all retirees who have combat related conditions being compensated by the VA. These retirees can receive restoration of the VA offset of their retirement up to the amount of their LOS retirement amount or the amount of VA compensation for combat related conditions, whichever is less. CRSC must be applied for through your Service who get to decide which conditions are combat related. See DoDI 1332.38 for definitions of combat related conditions.
If the PEB rating is less than 30%, a service member receives a one-time severance payment based on years served (2 months base pay time years of service.) This severance pay offsets VA compensation for the same condition that was found unfitting by the PEB. However, if the unfitting condition began or was aggravated while in a combat zone, the severance pay does not offset VA compensation.
There are programs that allow a member found unfitting by a PEB to remain in service until 20 years or more. In the Army this program is called Continuation on Active Duty (COAD). One population targeted for such programs is those with 15 or more active duty years. This is a program worth exploring especially if your VA rating will be 50% or more making you eligible for CRDP if you make it to 20 years. This can mean thousands of dollars more a month.
To say it boils down to choosing VA or DoD is an gross oversimplification. You get both DoD and VA benefits and while VA compensation can offset DoD retirement, this is not always true and the truth may change in the future.
Bottom line: If eligible for disability benefits from DoD, ensure you get them. There are many more devilish details but this is a Barney as I can make it without losing the key minimum elements you need to know.
Mike
