Military Disability and Severance Pay

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When someone is separated from being in the military due to medical reasons, they may qualify for either military disability retirement benefits or a severance payment. This is important as it can help service members who are forced out of their military service due to medical reasons. 

Permanent Disability

If a service member becomes permanently disabled, they may be entitled to disability retirement pay from the Department of Defense if they meet the following requirement:

  1. They have been in the military for at least 20 years; or
  2. (Under the standard schedule of rating disabilities) their disability is rated a minimum of 30% and they incurred the disability in the line of duty or as a result of active duty.

Both requirements are not necessary to be met; only one. If someone meets one of the aforementioned requirements, he or she can receive retired pay based on two separate formulas:

  1. By multiplying the retired pay base by the percentage of the disability rating; or
  2. By 2.5% of the number of years of service, up to a 75% ceiling. 

The final basic pay for those who entered service prior to September 8, 1980 is the retired pay and the average basic pay for those who entered service on or after that date is over the three years one earned the most.

Temporary Disability

Individuals who have medical issues that temporarily prevent them from carrying out their military duties are placed on temporary disability retirement; a list that is maintained by each service and the paymasters of the Defense Department. What someone who is temporarily disabled earns is different from an individual with permanent disability. Minimum payment for a temporarily disabled service member is 50% of the last amount of basic pay prior to when the member was taken off duty, up to 75%.

A service member who receives temporary disability retirement pay must be examined every 18 months to determine whether the status of their disability has changed. Doctors must determine within a period of five years as to whether or not the individual has a permanent disability. Once this determination is made, the service member can return to duty and they can receive a disability rating that qualifies them for permanent disability retirement pay, disability severance pay, or separation without disability benefits. 

Disability Severance Pay

Military service members who have less than 20 years of service, as well as disabilities, rated less than 30% will receive disability severance pay. Minimum severance pay starts at 12 months of basic pay for troops who are separated for a disability that was incurred in a combat zone and six months of basic pay for everyone else. Maximum severance pay is equal to 38 months of basic pay. 

If a service member receives severance pay, they may also be eligible to receive monthly VA disability compensation if their disabilities are found to be connected to their time in the service. However, severance pay must generally be repaid prior to receiving VA disability compensation. It’s important to note that severance pay for a disability incurred while in a combat zone isn’t required to be repaid. Severance pay for disabilities that were suffered outside of a combat zone is subject to the VA disability compensation offset.

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Military Disability and Severance Pay

When someone is separated from being in the military due to medical reasons, they may qualify for either military disability retirement benefits or a severance payment. This is important as it can help service members who are forced out of their military service due to

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