Concurrent Receipt Gains, Early Reserve Retirement Voted

Tens of thousands of veterans forced from service short of 20 years because of combat-related injuries will be eligible for Combat-Related Special Compensation effective Jan. 1, 2008, under a compromise 2008 defense authorization bill worked out by House and Senate conferees.

The CRSC payments would be set using the same formula as military retirement, usually 2.5 percent of base pay multiplied by years of service. CRSC would be paid on top of disability compensation, thus ending for these combat-injured the long time ban on “concurrent receipt.”

The size of the eligible population among so-called “Chapter 61” retirees was not immediately available but the projected cost of the combat-related program is $678 million over the next 10 years. Conferees rejected a more modest House plan which would have restricted CRSC eligibility to the most seriously disabled who served at least 15 years.

The compromise defense bill, which the full House and Senate are expected to pass before Congress adjourns Dec. 21, also endorses:

A $50-a-month “indemnity allowance” for survivors of disabled military retirees who see their Survivor Benefits Plan (SBP) annuities reduced each month by the amount they receive in tax-free Dependency and Indemnity Compensation (DIC) from the Department of Veterans Affairs. DIC is payable if members die while on active duty or if retirees die from service-related conditions. The indemnity allowance might be perceived as a first step toward easing the ban on concurrent receipt for military widows. It would be increased to $100 a month by 2014.

Conferees rejected Senate language that would have restored full SPB annuities for DIC-eligible widows at a cost over 10 years of $8.9 billion. The compromise allowance will cost $477 million through 2016 when it will have to be reauthorized.

Retroactive plus up in concurrent receipt for retirees rated IU.  These retirees, given “Individual Unemployability” status by the VA, draw disability compensation at the 100-percent level though their actual ratings are lower. The IU population, however, was excluded from full concurrent receipt benefits when they were granted to 100-percent rated disabled Jan. 1, 2005. Conferees accepted a Senate provision to grant IU retirees full concurrent receipt back to that date.

Earlier retirement for certain reservists. Conferees agree to lower the age at which reservists can retiree by three months for every 90 days of active duty served in support of a contingency operation including wars in Iraq and Afghanistan. However, this change only would apply to assignments after September 2007.

Time extended for using Reserve GI Bill. Reservists and National Guard personnel no longer will have to remain in drill status to use their educational benefits. They will have 10 years to use their benefits after separating from service.  Those who already have left reserve status will be able to rejoin and reclaim their previously earned educational benefits and use them for 10 years following their subsequent separation.

Drug prices. To hold down drug costs for the Department of Defense, drug manufacturers will have to provide the same federal discounts on prescriptions filled through the TRICARE retail network that they do for military base and VA hospital pharmacies.

Not approved by conferees was a Senate provision that would have moved forward by one year the effective date of an SBP paid-up premium rule for retirees age 70 and older who have paid premiums at least 30 years. The rule will not go into effect until Oct. 1, 2008.

On the 2008 pay raise, both chambers already had endorsed a 3.5 percent increase to take effect next month. But the House wanted to set pay raises for years 2009 through 2012 a half percentage point above wage growth in the private sector. This would have continued a favorable pattern of raises for active and reserve forces, begun seven years ago, to eliminate steadily a perceived pay gap between the military and civilian peers. Senate conferees would not go along with locking in the bigger pay raises.

A NEW VA SECRETARY -- “A veteran should not need a lawyer to figure out what his benefit is, and he should not need a lawyer to get it,” said retired Army Lt. Gen. (Dr.) James Peake at his Dec. 5 confirmation hearing to be the new VA secretary.

The nomination of Peake, a former Army surgeon general who twice was wounded while serving as an infantry officer in Vietnam, is moving swiftly toward confirmation. He assured senators that their priorities for veterans were also his, including reducing bureaucratic delays and red tape.

Peake said he wants to smooth the transition of war wounded and other disabled veterans from military health care to the VA medical system. He also is committed to improving access to care and to speeding claims processing for all eligible veterans. He wants to improve detection and treatment of combat stress disorders and traumatic brain injury.

Though “gratified that the VA has nearly 3000 new claims people on board or in training,” Peake said he wants to make the system less complex, more understandable and better supported with information technology.

Peake, 63, promised to speak up if the VA budget is insufficient to support promised programs and benefits. He agreed with Sen. Jim Webb (D-Va.) that the Montgomery GI Bill was designed for a peacetime era.  But he stopped short of endorsing Webb’s call for creation of a World War II-era type of education benefit for veterans who entered service since 9-11.

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