New plan in works for offset retired pay

Tom Philpott

With fewer strings attached this time to avoid the ire of veterans’ groups, House leaders are nearing a new deal with the Bush administration to end for many military retirees the offset in retired pay that occurs when they draw disability pay from the Department of Veterans Affairs.
The deal would cost an estimated $30 billion over 10 years, said Rep. Tom Cole, R-Okla., a freshman lawmaker who serves on the House Armed Services Committee and was briefed on the plan.
At issue is the century-old ban on “concurrent receipt” of both military retirement and VA disability compensation.
Retirees now forfeit a dollar of retired pay for each dollar they draw in VA disability compensation.
Here are highlights of how that law would be changed under the tentative deal that Cole was briefed on by House leaders in early October:
n Effective Jan. 1, military retirees with 20 or more years of service and disabilities tied to combat or combat-related training would see offsets in retired pay from those disabilities restored as they continue to draw VA compensation.
n Also Jan. 1, retirees with disabilities of any kind, rated 50 percent or higher, would begin to see lost retired pay restored in phases, over a set period, perhaps 10 years. Cole cautioned the length of phase-in was still being negotiated as the Office of Management and Budget works cost estimates for various options.
n Unlike the new Combat-Related Special Compensation program, which took effect June 1, Reserve and National Guard retirees would be eligible for concurrent receipt too, as described above. There would be no hurdle of 7200 retirement points as under CRSC.
n Both CRSC and the three-year-old special disability compensation program, which pays up to $325 a month to retirees given VA disability ratings of 60 percent or higher within four years of retirement, would end with a new concurrent receipt deal.
n In 2004, a special commission would be established to study VA and military disability programs and to recommend reforms, which could include tightening disability rules for future generations of veterans.
Current retirees would be grandfathered from any changes to criteria and benefits, Cole said. Veterans groups likely would be represented on the commission.
Cole, whose district includes Fort Sill and thousands of retirees, described the deal as “real serious.”
He added, “I’m going to be surprised if we don’t get a major step forward” on concurrent receipt.
He credited Rep. Duncan Hunter, R-Calif., chairman of the House Armed Services Committee, and Rep. Roy Blunt, R-Mo., majority whip, for a “phenomenal job” negotiating with the Senate and White House.
Tom Philpott can be contacted at Military Update, P.O. Box 231111, Centreville, Va. 20120-1111.