Petty Officer 1st Class Doyle Stanley, a 12-year serviceman who was recommended for retirement with 50 percent disability pay after he was partially debilitated after surgery in Naval hospitals, can retire with 90 percent disability pay, a Navy panel decided yesterday.

But the panel would not address whether Stanley could reject that offer and remain in the Navy, a wish Stanley has voiced and an option that the secretary of the Navy decided Monday the 29-year-old petty officer should have.

The Regional Physical Evaluation Board said Secretary John Lehman will discuss other options with Stanley. But if Stanley retires, he should be evaluated at a higher level of disability, the board said.

"He's entitled to that," said Capt. Mario R. Schwabe, a doctor and a member of the three-member review team. "It's a clear, clear case."

Stanley has been debilitated by a virulent staph infection that began after a benign bone tumor was removed from his sinus in 1983. The infection went undetected until a private doctor, whom Stanley consulted, detected it. In the last two years, he has undergone seven operations and lost part of his skull to the infection.

Stanley, the father of two, became increasingly concerned about his future in September 1984 when a Navy evaluation board decided that he should be retired with 50 percent disability. Stanley disputed the recommendation.

His ordeal was chronicled Monday in The Washington Post. Later that day, Lehman said Stanley could remain on permanent active duty no matter what internal boards decided.

The decision yesterday to increase Stanley's disability pay -- a jump that would give him $930 a month rather than $625 -- was made after a low-key, hour-long hearing during which Stanley testified that his brain, unprotected by bone, bulges daily from his forehead.

"Every day, during the course of the day, it swells," Stanley said. As he spoke, Stanley removed a protective plastic helmet he has worn since his frontal skull bone was removed in August 1984.

He described the protection as "extremely uncomfortable, causing blisters on my forehead." But the helmet also allows him to attempt a restricted but active life with his family -- the kind of life he would like with the Navy, Stanley said.

"I would still like to stay on active duty, but only if I will be allowed to seek medical care in the civilian community -- with civilian doctors -- and if the U.S. government will pay the bills," said Stanley, who has expressed dissatisfaction with Naval medical care.

Lehman must decide the issue of civilian care, military attorneys said yesterday. Representatives from Lehman's office are not expected to act on Stanley's case for two to six weeks, Navy spokesmen said.

The hearing yesterday initially was closed to the press by the panel president, Capt. John Fellowes. Fellowes said the hearing would be open to the public but not the press, which could make a "mockery" of the proceedings. After an appeal from The Washington Post and a request by Stanley to admit a reporter, the hearing was opened.