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Military Retirement: Major Legislative Issues (CRS Report for Congress)

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Release Date Revised March 14, 2006
Report Number IB85159
Authors Charles A. Henning, Foreign Affairs, Defense, and Trade Division
Source Agency Congressional Research Service
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Summary:

The military retirement system includes benefits for retirement after an active or reserve military career, disability retirement, and survivor benefits for eligible survivors of deceased retirees. Concurrent Receipt. The change to the system that has generated the most recent legislative activity involves whether some or all military retirees should be allowed to receive both military retired pay and any VA disability compensation to which they are otherwise entitled; this is referred to as 'concurrent receipt.' Until 2004, the law provided that military retired pay had to be reduced by the amount of VA disability compensation. Some maintained this was inequitable and unfair; it was defended on grounds of cost and of the need to avoid setting a precedent for concurrent receipt of numerous other federal benefits. […] The most significant military retirement issue Congress dealt with in 2005 was whether military retirees with a 100% VA unemployability rating, but less than a 100% disability rating, should be entitled to full concurrent receipt as was provided to 100% disability retirees in 2004. The House version of the FY2006 NDAA would have granted such retirees full concurrent receipt effective October 1, 2009, rather than the January 1, 2014 date currently in effect; the Senate version would have allowed immediate concurrent receipt for this population. The House version prevailed in the Conference Committee. The most recent military retirement cost-of- living-adjustment (COLA) was 4.1%, first applied to the retired pay disbursed on January 1, 2006. The next regularly scheduled COLA will be applied on January 1, 2007.
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