Some military retirees with service-related disabilities would have to wait less time to collect both their full retirement pay and disability compensation under legislation the House passed last week.
The measure, included in the Defense Authorization Bill by Rep. G. K. Butterfield (D-N.C.), would end by 2009, for some retirees, a system that requires their federal disability payments to be offset by dollar-for-dollar reductions in retirement pay. Under current law, that trade-off is scheduled to be phased out by 2014 for military retirees with more than 20 years of service and a disability rated at 50 percent or higher by the Department of Veterans Affairs.
"We have a responsibility to support the fighting men and women who put their lives on the line to protect our way of life," Butterfield said in a written statement.
His provision would allow military retirees who served for at least 20 years, and who are rated as both 60 to 90 percent disabled and unemployable, to collect their full VA disability and military retirement benefits at the same time beginning Oct. 1, 2009. That group includes about 30,000 retirees, according to the Congressional Budget Office, which estimated the cost of the change at $164 million over five years.
Senate Minority Leader Harry M. Reid (D-Nev.) is preparing an amendment that would match the House provision, said his spokeswoman, Tessa Hafen. Hafen said Reid, like Butterfield and other lawmakers of both parties, would prefer to eliminate the offset right away if they could.
"The goal is always 100 percent," she said. "He tries for a step at a time."
The political jockeying over the issue, known as "concurrent receipt," has been an annual affair on Capitol Hill in recent years.
Proponents of changing the system argue that disability compensation and retirement pay address two different issues, and that denying veterans the full benefit of both shortchanges their service and sacrifice.
Other critics say that some veterans are seeking more than their fair share, and that the issue is more nuanced than military retirees and their advocates let on.
In 2003, lawmakers agreed to eliminate the offset over a 10-year period for about 200,000 veterans who have 50 percent or higher VA disability ratings and served for 20 years or more. Last year, Congress decided the most severely injured among that group, those rated 100 percent disabled by the department, should not have to wait. They began collecting full disability and retirement pay in January.
But other veterans who say they have similar medical problems and years of service say that they were left out. They have formal VA disability ratings as low as 60 percent, but VA doctors say their service-related health problems render them unemployable. This group, the target of the new legislation, currently must wait out the 10-year period before collecting full compensation -- a delay that will cost each an average of $2,400 in 2010, according to the CBO.
Win Reither, a co-director of Vetspac, a political action committee that focuses on veterans' issues, said the proposed change is a marginal improvement because most benefits of the 10-year phase-out are already set to take place in the first five years.
"It's really of very little benefit to veterans," Reither said. "There's very little advantage, but, no less, it's a good move because there is some inequity there."
Critics of the proposed change point out that everyone who would benefit from the provision had to be fit enough to stay in the military for two decades. Other veterans whose injuries were so severe they had to leave the military before serving for 20 years can collect disability payments but will never get retirement pay.
They also note that service members with at least 20 years of service can collect retirement pay as soon as they retire, often in their late thirties or early forties. In this way, they say, the system compensates retirees for the wear and tear of a strenuous military career. Private-sector retirees often must wait until their late fifties or early sixties to begin collecting benefits.
Finally, some critics say the affected retirees often suffer from ailments that have as much or more to do with age as with military service, including high blood pressure, hearing loss and arthritis.