Retire vs Medboard over 20. What's the difference?

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raprior

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20 year medboard retirement vs 20 year retirement - what's the difference? Long story short, I need a break down of the difference in benefits.

Things I've been told - when medically retired:
-No tricare for life annual fee.
- Prescription copay rates are locked at the current rates.
-The pension value could be different, depending on years in service and the DoD disability rating.
-If you have a disability pension, the pension is tax exempt.

Can someone confirm the above is true, and please add any other differences? I'm very specifically looking for over 20 in both cases.

Also, a reference for what qualifies you for DoD disability vs. VA. I know you can have different rating, but I don't know what the criteria is that allows different ratings to occur.
 
-No annual enrollment fees for Tricare Select. I do believe you pay the annual fee if you select Prime.
-That's not unique to medical retirement. Prescription costs are based on when you entered service. Also, if conditions are service connected you can get the prescriptions through the VA with zero out of pocket costs.
-No real benefit on pension because CRDP with 20 years will max out compensation. The exception could be if one unfitting condition is labeled combat related by PEB. Net pay would be more since chapter 61 pension would not be subject to federal income taxes. You could achieve same highest net compensation with regular retirement and approved CRSC if the percentage was high enough.

20 year regular retirement is easy and predictable. Chapter 61 retirement with less than 20 years of active federal service is risky. Hit 20 years AFS if possible.
 
raprior said:
20 year medboard retirement vs 20 year retirement - what's the difference? Long story short, I need a break down of the difference in benefits.

Things I've been told - when medically retired:
-No tricare for life annual fee.
- Prescription copay rates are locked at the current rates.
-The pension value could be different, depending on years in service and the DoD disability rating.
-If you have a disability pension, the pension is tax exempt.

Can someone confirm the above is true, and please add any other differences? I'm very specifically looking for over 20 in both cases.

Also, a reference for what qualifies you for DoD disability vs. VA. I know you can have different rating, but I don't know what the criteria is that allows different ratings to occur.
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Hello @Dory214

1. Regular retirement (20 years active duty or more) one receives their VA compensation and with 50% or more VA compensation receives longevity retired pay too Via CRDP.

2. Disability retired pay, one usually receives the DOD disability percentage as a multiplier x average high three base pay = disability retired pay. It is reduced dollar for dollar in the amount of VA comp received. Any amount that exceeds the VA offset is kept by the retiree. If the retiree also has 20 years active duty and 50% or more VA rating, he/she receives the longevity portion of retired pay as CRDP. The combination of CRDP and residual retired pay (left over) cannot exceed the longevity amount.

3. Ratings:
—VA rates all service connected disabilities
—DoD rates only the disabilities that are unfitting for continued service. The Medical Evaluation Board (MEB) is a process made to determine if a service member’s long-term medical condition allows them to continue to meet medical retention standards, in compliance with military service regulations.

4. Taxes:

TDRL/PDRL Exemption: If you retired under a disability law (Temporary Disability Retirement List or Permanent Disability Retirement List), your retired pay will be fully non-taxable if your pay is calculated based upon your military (not VA) disability percentage and you meet one of the following conditions:
  • You were in the military or under a contractual obligation to join the military on September 24, 1975, or
  • Your military disability rating is combat-related
The welcome letter you received from DFAS when you first retired indicates whether your pay is computed using your military percentage of disability or your years of service.

VA Compensation Deduction: For most members who retired under a non-disability law, retired pay taxable income is simply reduced by the amount of any VA compensation received. For members who retired under the Temporary Disability Retired List or the Permanent Disability Retired List, retired pay taxable income is reduced by whichever of the following is greater:
  • The amount of VA compensation received or
  • A tax-exempt amount of gross pay determined by the following formula:
Step 1:
Military (not VA) disability percentage: %
x (times) Active Duty pay at the time of retirement:
= (equals) Initial amount of tax-exempt gross pay

Step 2:
Initial amount of tax-exempt gross pay:
x (times) applicable Cost-Of-Living-Adjustment (COLA): %
= (equals) Current tax-exempt gross pay

Ron
 
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RonG said:
Hello @Dory214

1. Regular retirement (20 years active duty or more) one receives their VA compensation and with 50% or more VA compensation receives longevity retired pay too Via CRDP.

2. Disability retired pay, one usually receives the DOD disability percentage as a multiplier x average high three base pay = disability retired pay. It is reduced dollar for dollar in the amount of VA comp received. Any amount that exceeds the VA offset is kept by the retiree. If the retiree also has 20 years active duty and 50% or more VA rating, he/she receives the longevity portion of retired pay as CRDP. The combination of CRDP and residual retired pay (left over) cannot exceed the longevity amount.

3. Ratings:
—VA rates all service connected disabilities
—DoD rates only the disabilities that are unfitting for continued service. The Medical Evaluation Board (MEB) is a process made to determine if a service member’s long-term medical condition allows them to continue to meet medical retention standards, in compliance with military service regulations.

4. Taxes:

TDRL/PDRL Exemption: If you retired under a disability law (Temporary Disability Retirement List or Permanent Disability Retirement List), your retired pay will be fully non-taxable if your pay is calculated based upon your military (not VA) disability percentage and you meet one of the following conditions:
  • You were in the military or under a contractual obligation to join the military on September 24, 1975, or
  • Your military disability rating is combat-related
The welcome letter you received from DFAS when you first retired indicates whether your pay is computed using your military percentage of disability or your years of service.

VA Compensation Deduction: For most members who retired under a non-disability law, retired pay taxable income is simply reduced by the amount of any VA compensation received. For members who retired under the Temporary Disability Retired List or the Permanent Disability Retired List, retired pay taxable income is reduced by whichever of the following is greater:
  • The amount of VA compensation received or
  • A tax-exempt amount of gross pay determined by the following formula:
Step 1:
Military (not VA) disability percentage: %
x (times) Active Duty pay at the time of retirement:
= (equals) Initial amount of tax-exempt gross pay

Step 2:
Initial amount of tax-exempt gross pay:
x (times) applicable Cost-Of-Living-Adjustment (COLA): %
= (equals) Current tax-exempt gross pay

Ron
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Ron,

Awesome reply! I was not the original poster though. I just accidentally hit reply when I was scrolling, and I don't know how to delete a reply on here. :confused::) RAPRIOR is the original poster but either way they will still see your awesome, in-depth reply.

With that being said, your #2 response confused me. To my understanding, I thought that You can choose to either, Do the normal retirement option which is usually 50% of your base pay under high 36 (high 3) OR you can choose to go with the High 3 base pay x the DoD disability percentage (not to exceed 75%) to determine your DoD retirement pay.

Ex. I am High 36 with 20 years (high 3) so I can pick to either take 50% of the average of my last 36 months of my base pay OR if I get 75% disability rating from the DoD, I can pick to multiply my High 3 base pay by 75% (my DoD disability rating) which means that I will receive 75% of my high 3 base pay. I will obviously choose the higher one if I get the ratings from the DoD.

Where I am confused here is that I thought that I would be able to keep both the 75% of my High 3 base pay for my DoD retirement (which would be $3,692.91) AND all of my 100% VA Disability pay (which would be $3,621.95). Is this NOT the case?
 
Dory214 said:
Ron,

Awesome reply! I was not the original poster though. I just accidentally hit reply when I was scrolling, and I don't know how to delete a reply on here. :confused::) RAPRIOR is the original poster but either way they will still see your awesome, in-depth reply.

With that being said, your #2 response confused me. To my understanding, I thought that You can choose to either, Do the normal retirement option which is usually 50% of your base pay under high 36 (high 3) OR you can choose to go with the High 3 base pay x the DoD disability percentage (not to exceed 75%) to determine your DoD retirement pay.

Ex. I am High 36 with 20 years (high 3) so I can pick to either take 50% of the average of my last 36 months of my base pay OR if I get 75% disability rating from the DoD, I can pick to multiply my High 3 base pay by 75% (my DoD disability rating) which means that I will receive 75% of my high 3 base pay. I will obviously choose the higher one if I get the ratings from the DoD.

Where I am confused here is that I thought that I would be able to keep both the 75% of my High 3 base pay for my DoD retirement (which would be $3,692.91) AND all of my 100% VA Disability pay (which would be $3,621.95). Is this NOT the case?
Click to expand...
The answer is no. You can never exceed the longevity earned + VA disability. That's why if you have 20 years regular retirement and qualify for CRDP you pretty much max everything out.
 
@Provis is correct.

2. Disability retired pay, one usually receives the DOD disability percentage as a multiplier x average high three base pay = disability retired pay. It is reduced dollar for dollar in the amount of VA comp received. Any amount that exceeds the VA offset is kept by the retiree. If the retiree also has 20 years active duty and 50% or more VA rating, he/she receives the longevity portion of retired pay as CRDP. The combination of CRDP and residual retired pay (left over) cannot exceed the longevity amount. One also receives all their VA comp.

Although these formulas can be confusing, this is nothing new.

See: https://comptroller.defense.gov/Portals/45/documents/fmr/current/07b/07b_64.pdf <—-LINK
Ron
 
Provis said:
The answer is no. You can never exceed the longevity earned + VA disability. That's why if you have 20 years regular retirement and qualify for CRDP you pretty much max everything out.
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Oooooohhhhhhhhh KKKKKKKKKKKKKKKKK. I got it now!! Thank you!
 
RonG said:
@Provis is correct.

2. Disability retired pay, one usually receives the DOD disability percentage as a multiplier x average high three base pay = disability retired pay. It is reduced dollar for dollar in the amount of VA comp received. Any amount that exceeds the VA offset is kept by the retiree. If the retiree also has 20 years active duty and 50% or more VA rating, he/she receives the longevity portion of retired pay as CRDP. The combination of CRDP and residual retired pay (left over) cannot exceed the longevity amount. One also receives all their VA comp.

Although these formulas can be confusing, this is nothing new.

See: https://comptroller.defense.gov/Portals/45/documents/fmr/current/07b/07b_64.pdf <—-LINK
Ron
Click to expand...
Ron,

Thank you so much for this reference! It helped so much!! I FINALLY understand!! I won't be listening to other people that previously MED Boarded. LOL
 
Dory214 said:
Ron,

Thank you so much for this reference! It helped so much!! I FINALLY understand!! I won't be listening to other people that previously MED Boarded. LOL
Click to expand...
Hello and thank you.

I should add that it is NOT a choice between what is higher, VA comp or Disability Retirement pay. It is a choice to agree (or decline) to waive retired pay dollar for dollar in the amount of VA compensation. As stated previously, the retiree gets to keep any retired pay left over (residual retired pay) from the waiver.

As stated by many: I have never seen one case where it was more advantageous to select retired pay and decline VA compensation. VA comp is nontaxable.

Ron
 
RonG said:
@Provis is correct.

2. Disability retired pay, one usually receives the DOD disability percentage as a multiplier x average high three base pay = disability retired pay. It is reduced dollar for dollar in the amount of VA comp received. Any amount that exceeds the VA offset is kept by the retiree. If the retiree also has 20 years active duty and 50% or more VA rating, he/she receives the longevity portion of retired pay as CRDP. The combination of CRDP and residual retired pay (left over) cannot exceed the longevity amount. One also receives all their VA comp.

Although these formulas can be confusing, this is nothing new.

See: https://comptroller.defense.gov/Portals/45/documents/fmr/current/07b/07b_64.pdf <—-LINK
Ron
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The document in the link was very helpful, if I understood it correctly. It seems that it can be advantageous to go through a med board if you will be a qualified career disability retiree.
 
Hello @USMC
USMC2002 said:
The document in the link was very helpful, if I understood it correctly. It seems that it can be advantageous to go through a med board if you will be a qualified career disability retiree.
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Yes, you understand perfectly.

Regards,
Ron
 
Hello all,

Please forgive me as I see this question has a very well detailed explanation however, it’s a bit difficult to read all of the intricate information.

If a service member with 20 yrs of service is medically retired they will receive a retirement pension AND disability pay correct?

From what I understand, if a service member received a 100% disability rating, they would receive 75% retirement pension with the difference of VA pay paid in disability payments?

Ex: E-7 is medically retired with 20 yrs at 100% disability:
They will receive 75% of high 36 retirement pay AND
Monthly DOD medical payments equal to the difference in 100 VA disability pay had they retired normally and received 100 VA disability pay?

What if the service member was an officer at 20 years but had only served 8.5 years as a commissioned officer; would their high 36 be calculated at their reverted enlisted rank or does a provision allow them to keep the Officer pay because they were medically separated? Thank you in advance.
 
My question is about the difference between been retired medically by MEB vs PEB , why when I asked for my 15 years certification letter , because my points for retirement put me in 19 years the RSO DENNIED ME THE LETTER BECAUSE I WAS RETIRED BY THE MEB AND NOT BY PEB to qualify to my Army National Guard retirement pay when I get my 60 years.
 
Gandalf12 said:
Hello all,

Please forgive me as I see this question has a very well detailed explanation however, it’s a bit difficult to read all of the intricate information.

If a service member with 20 yrs of service is medically retired they will receive a retirement pension AND disability pay correct?

From what I understand, if a service member received a 100% disability rating, they would receive 75% retirement pension with the difference of VA pay paid in disability payments?

Ex: E-7 is medically retired with 20 yrs at 100% disability:
They will receive 75% of high 36 retirement pay AND
Monthly DOD medical payments equal to the difference in 100 VA disability pay had they retired normally and received 100 VA disability pay?

What if the service member was an officer at 20 years but had only served 8.5 years as a commissioned officer; would their high 36 be calculated at their reverted enlisted rank or does a provision allow them to keep the Officer pay because they were medically separated? Thank you in advance.
Click to expand...
If you reach 20 AFS then it doesn't matter. You can't get more than the earned longevity + VA disability pay. So whether medically retired with 30% or 75% you total pay won't change. You already max out compesnation by getting all of your VA pay and all of your earned longevity pay at 50% assuming 20 years and legacy and not BRS.

If medically retired the 10 year rule doesn't apply so your HIGH 3 would be based on the highest Officer pay.
 
GUILLO 2011 said:
My question is about the difference between been retired medically by MEB vs PEB , why when I asked for my 15 years certification letter , because my points for retirement put me in 19 years the RSO DENNIED ME THE LETTER BECAUSE I WAS RETIRED BY THE MEB AND NOT BY PEB to qualify to my Army National Guard retirement pay when I get my 60 years.
Click to expand...
There is no benefit for 15 year letter if immediately medically retired via Chapter 61 pension. Even if they did it wouldn't help you because you need to 20 year letter to utilize your NG pension at age 60 to get concurrent receipt of VA pay.

So your only way to increase compensation is via CRSC. Your cap for CRSC is the value of your NG pension or if awarded lower than that cap it would be the CRSC% pay based on VA disability pay charts since CRSC pay utilizes same pay charts as VA pay.
 
Provis said:
If you reach 20 AFS then it doesn't matter. You can't get more than the earned longevity + VA disability pay. So whether medically retired with 30% or 75% you total pay won't change. You already max out compesnation by getting all of your VA pay and all of your earned longevity pay at 50% assuming 20 years and legacy and not BRS.

If medically retired the 10 year rule doesn't apply so your HIGH 3 would be based on the highest Officer pay.
Click to expand...
Thank you!
 
Dory214 said:
Ron,

Awesome reply! I was not the original poster though. I just accidentally hit reply when I was scrolling, and I don't know how to delete a reply on here. :confused::) RAPRIOR is the original poster but either way they will still see your awesome, in-depth reply.

With that being said, your #2 response confused me. To my understanding, I thought that You can choose to either, Do the normal retirement option which is usually 50% of your base pay under high 36 (high 3) OR you can choose to go with the High 3 base pay x the DoD disability percentage (not to exceed 75%) to determine your DoD retirement pay.

Ex. I am High 36 with 20 years (high 3) so I can pick to either take 50% of the average of my last 36 months of my base pay OR if I get 75% disability rating from the DoD, I can pick to multiply my High 3 base pay by 75% (my DoD disability rating) which means that I will receive 75% of my high 3 base pay. I will obviously choose the higher one if I get the ratings from the DoD.

Where I am confused here is that I thought that I would be able to keep both the 75% of my High 3 base pay for my DoD retirement (which would be $3,692.91) AND all of my 100% VA Disability pay (which would be $3,621.95). Is this NOT the case?
Click to expand...
Your assumption is correct, if you've served at least 20 years FAS.
 
raprior said:
20 year medboard retirement vs 20 year retirement - what's the difference? Long story short, I need a break down of the difference in benefits.

Things I've been told - when medically retired:
-No tricare for life annual fee.
- Prescription copay rates are locked at the current rates.
-The pension value could be different, depending on years in service and the DoD disability rating.
-If you have a disability pension, the pension is tax exempt.

Can someone confirm the above is true, and please add any other differences? I'm very specifically looking for over 20 in both cases.

Also, a reference for what qualifies you for DoD disability vs. VA. I know you can have different rating, but I don't know what the criteria is that allows different ratings to occur.
Click to expand...
If you already have over 20 years, the main difference is how the retirement is categorized, not that you lose benefits. A regular 20 year retirement is based purely on years of service and your pension is calculated from that time. A medical retirement over 20 lets you receive whichever calculation is higher, either the longevity formula or the DoD disability percentage. Healthcare, commissary, Tricare, and retiree status are essentially the same. The big distinction is that VA compensation can be tax free and paid in addition to retired pay depending on your ratings, and DoD only rates conditions that make you unfit for duty while the VA rates everything service connected.
 
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