DoD Disability vs VA Disability: What’s the Difference?

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The Department of Defense (DoD) and the Department of Veterans Affairs (VA) both provide disability benefits to military service members and veterans, but they do so for different reasons and under different systems.

DoD Disability, also called Permanent Disability Retirement (PDR) or Temporary Disability Retirement (TDR) focuses on assessing whether a service member’s medical condition prevents them from performing military duties, providing benefits like retirement or separation based on fitness for service.

VA Disability, on the other hand, is intended to make up for the potential economic loss of civilian wages or loss of civilian working time because of service-connected disability conditions. Congress requires the VA to base its rating schedule, “as far as practicable, upon the average impairments of earning capacity” in “civil occupations” that a veteran will experience due to the disability in question. See 38 U.S.C. 1155.

Understanding the distinctions between DoD disability and VA disability is crucial for military members and veterans to get the benefits they deserve.

Summary of Key Points

DoD disability compensates military members deemed unfit for military service whereas VA disability compensates veterans for disabilities that are service-connected due to military service. DoD disability ratings are generally lower than VA disability ratings. The VA disability compensation system is typically a more favorable system for higher ratings and tax-free compensation.
DoD disability “retirement” pay and benefits kicks-in with a rating of 30% or higher while DoD disability “separation” severance pay is for ratings below 30%. VA disability compensation begins at a 10% rating. You’re eligible for additional compensation for dependents with a VA rating of 30% or more.
If you are medically retired by DoD, you are not eligible for concurrent receipt of both DoD disability and VA disability (there’s an “offset” rule) unless you qualify for either the Combat Related Special Compensation (CRSC) program or the Concurrent Retirement & Disability Pay (CRDP) program.

DoD Disability vs VA Disability: Comparison Chart

What	DoD Disability	VA Disability
Purpose	Compensates for disabilities deemed unfit for military service.	Compensates for disabilities that are service-connected due to military service, regardless of impact on military service capability.
Eligibility	Active duty, reservists, or retirees deemed unfit for duty due to a service-related disability.	Any veteran who meets basic eligibility criteria and has one or more service-connected disabilities.
Disability Rating	Ranges from 0% to 100% in increments of 10%; must be 30% or higher for retirement benefits. Below 30% results in a separation severance.	Ranges from 0% to 100% in increments of 10%; compensation begins at 10%. Veterans are eligible for additional compensation for their dependents with a VA rating of 30% or higher.
Compensation	Based on final military pay or high-3 average salary, percentage of disability, and years of service.	Based on disability percentage and number of dependents, not tied to past military salary.
Separation Pay	One-time separation pay severance based on a DoD disability rating below 30%.	DoD separation pay must be paid back VA disability compensation pay kicks-in.
Retirement Benefits	Eligible for retirement pay and benefits if disability rating is 30% or higher.	No retirement benefits.
Medical Benefits	May receive treatment at military facilities.	Access to VA healthcare facilities; extent of care depends on disability rating and specific needs.
Taxation	PDR and TDR are taxable.	VA disability compensation is non-taxable.
Concurrent Receipt	Typically, cannot receive full military retirement and disability pay simultaneously without CRDP or CRSC.	Veterans may receive VA disability compensation in addition to military retirement pay with a VA rating of 50% or higher.
Reevaluation	PDR is not subject to reevaluation. TDR is subject to reevaluation and can be extended or made permanent.	Reevaluations can occur unless the conditions are static or otherwise deemed not subject to a Routine Future Examination (RFE).
Appeal Process	Has an appeal process through the military for reevaluation of DoD disability ratings.	The VA has a separate appeals process with Higher Level Reviews, Supplemental Claims, and Board Appeals.

What is the Difference Between DoD vs VA Disability?

Purpose of the Benefits

DoD Disability: The primary purpose of DoD disability is to determine whether a service member is fit to continue serving in the military due to their medical condition. The system is designed to evaluate if an individual’s illness or injury renders them unable to perform their duties. If they are unfit, the disability rating helps determine the appropriate benefits, which may include retirement or separation from service.

VA Disability: The VA disability system is designed to compensate veterans for injuries or illnesses that were incurred or aggravated during their military service. VA disability compensation is intended to make up for the potential economic loss of civilian wages or loss of civilian working time because of service-connected disability conditions. Congress requires the VA to base its rating schedule, “as far as practicable, upon the average impairments of earning capacity” in “civil occupations” that a veteran will experience due to the disability in question. See 38 U.S.C. 1155.

Assigning a Particular Rating

DoD Disability: Ratings are based strictly on whether the service member can fulfill their military duties. Only conditions that directly affect duty performance are considered, and the rating given reflects the degree to which the condition impacts military fitness.

VA Disability: Ratings are based on the degree to which a condition impairs the veteran’s overall health and ability to function in civilian life. This includes a broader range of symptoms and secondary conditions related to the primary service-connected condition. The complete list of VA disability conditions is comprised of 923 eligible conditions. Note: This list includes both analogous and equivalent VA disabilities.

Assigning a Percentage of Disability

DoD Disability: Ratings are given in increments of 10%, ranging from 0% to 100%. A rating of 30% or higher qualifies for medical retirement, while ratings below 30% result in separation with a one-time severance payment. Note: DoD disability ratings are generally lower than VA disability ratings.

VA Disability: Also uses a 10% increment system, but the VA combines ratings for multiple disabilities to calculate a total disability score. Veterans can receive compensation for a disability rated as low as 10%, and the benefits increase with the severity of the disability. A 0% rating is non-compensable. Note: VA disability ratings are generally higher than DoD disability ratings.

How to Calculate DoD Disability SEPARATION Pay

DoD Disability for Medical Separations: If the service member is given a combined DoD disability rating of 0%, 10%, or 20%, they are medically separated (not retired) from the military. All medically separated service members receive a single lump-sum severance payment for their DoD Disability and are not given any other benefits for their DoD Disability.

DoD Disability Separation Pay Explained: The DoD disability separation payment is equal to two months of basic pay for each year of military service. No matter how many years you served, the minimum number of years for calculation purposes is six years. So, even if you only served three years, the calculation number is six years. The maximum number of years is 19. Before January 28, 2008, the maximum was 12 years, and the minimum was three years.

DoD Disability Separation Pay Formula: The formula to calculate your DoD disability separation pay is: (Monthly Basic Pay x 2 Months) x Years of Service. As an example, if your basic pay is $2,500/month and you served for 10 years, then your DoD Disability Severance Payment would be calculated as follows: ($2,500 Monthly Basic Pay x 2 Months) x 10 Years of Service = $50,000.

How to Calculate DoD Disability RETIREMENT Pay

DoD Disability for Medical Retirements: If the service member is given a combined DoD disability rating of 30% or higher, they are medically retired from the military. When a service member is medically retired, they receive all the benefits of a service member who retired regularly from the military, including full medical care and monthly disability pay for life.

DoD Disability Retirement Pay Formula: The basic formula to calculate your DoD disability pay for a medical retirement is: Pay Base x Disability or Retirement % = Monthly Payment. It’s a 3-step process to determine your DoD disability retirement pay:

Step #1 – Figure Out Your Military Pay Base:

• If you joined the military before September 8, 1980, your pay base is your final month’s salary.

• If you joined on or after September 8, 1980, your pay base is the average monthly salary of your last three years in service.

• For reservists, it’s the average of your 36 highest paying months.

Step #2 – Decide Your DoD Disability or Retirement Percentage:

• You can choose between your combined military disability rating or your retirement percentage, which is your years of service multiplied by 2.5%. For example, 18 years of service equals a 45% retirement percentage (18 x 2.5 = 45).

• The maximum percentage you can receive is 75%, regardless of whether your disability rating is higher.

Step #3 – Apply the DoD Disability Retirement Formula:

• Pay Base x Disability or Retirement % = Monthly Payment

Example #1:

• Name: Sarah
• Service Entry Year: 1985
• Years of Service: 22 years
• DoD Disability Rating: 50%
• Final 3-Year Average Salary: $1,200 per month

Sarah’s retirement percentage is calculated as 22 years x 2.5% = 55%. Since her retirement percentage (55%) is higher than her disability rating (50%), she would choose the retirement percentage. Her monthly benefit would be calculated as: $1,200 x 55% = $660.

Example #2:

• Name: Mark
• Service Entry Year: 1977
• Years of Service: 10 years
• DoD Disability Rating: 70%
• Salary During Final Month: $800 per month

Mark’s retirement percentage is 10 years x 2.5% = 25%. In Mark’s case, his disability rating (70%) is higher than his retirement percentage (25%). He would choose to use his disability rating. His monthly benefit would be calculated as: $800 x 70% = $560.

Type of Benefits

DoD Disability: Benefits can include retirement pay, which is calculated based on the member’s rank and years of service, and may include other benefits such as healthcare for the retiree and their family.

VA Disability: Benefits primarily include monthly compensation payments, which are determined by the disability rating. Additionally, veterans may qualify for other benefits, such as health care, vocational rehabilitation, and housing assistance, among others.

Eligibility for Benefits

DoD Disability: Only conditions determined to be unfitting for military service are eligible for DoD disability benefits. Conditions that do not impact a service member’s ability to perform their military duties are not eligible.

VA Disability: All conditions that are linked to military service, whether they were diagnosed during or after the service member’s time in the military, are potentially eligible for VA compensation.

DoD Disability Compared to VA Disability: Frequently Asked Questions (FAQs)

What is DoD disability?

DoD disability refers to the disability evaluation process conducted by the Department of Defense for active-duty service members who incur a medical condition or injury that may impact their ability to serve in the military.

What is VA disability?

VA disability refers to compensation provided by the Department of Veterans Affairs to veterans who have disabilities that were caused or made worse by their military service or that are proximately due to or aggravated by another service connected disability for secondary service connection.

Who is eligible for DoD disability?

DoD disability evaluations are conducted for active-duty service members who incur a medical condition or injury while serving in the military.

Who is eligible for VA disability?

VA disability compensation is available to veterans who have a service-connected disability, meaning the disability occurred or was aggravated during military service.

What is the process for determining DoD disability ratings?

During the DoD disability process, a service member’s case is reviewed by two different boards: the Medical Evaluation Board (known as the “MEB”) and the Physical Evaluation Board (known as the “PEB”).

The Medical Evaluation Board (MEB) initially assesses the service member’s case to identify medically unacceptable conditions. Following this assessment, a report is forwarded to the Physical Evaluation Board (PEB), which conducts a comprehensive review to determine the eligibility of each condition for Department of Defense (DoD) Disability status. For a condition to qualify, it must satisfy both Service-Connection and Unfit For Duty criteria.

Subsequently, the Veterans Affairs (VA) assigns Military Disability Ratings to the qualifying conditions through the Integrated Disability Evaluation System (IDES). These ratings adhere to the guidelines outlined in the laws of the VA Schedule for Rating Disabilities (VASRD). They play a crucial role in determining two key aspects: (1) whether the service member will be subject to Medical Separation or Medical Retirement, and (2) the specific nature and extent of the DoD Disability benefits the service member will receive.

What is the process for determining VA disability ratings?

The VA disability claim process generally follows 5-steps: (1) Claim Received, (2) Initial Review by a Veteran Service Representative (VSR), (3) Evidence Gathering, Review, and Decision, (4) Preparation for Notification, and (5) Decision Packet Mailed and Claim Complete.

VA disability ratings are determined based on the severity of the service-connected disability and its impact on the veteran’s daily life. Ratings range from 0% to 100%, with higher ratings indicating more severe disabilities.

Are DoD disability ratings permanent?

PDR is considered permanent and not subject to reevaluation. TDR is subject to reevaluation and can be extended or made permanent.

Are VA disability ratings permanent?

VA disability ratings can be permanent, but they may also be subject to periodic reevaluations to ensure accuracy and to account for changes in the veteran’s condition. If your VA disability conditions are static, they are not subject to a Routine Future Examination (RFE).

How does DoD disability compensation differ from VA disability compensation?

DoD disability compensation is typically provided in the form of separation pay or disability retirement pay from the military. VA disability compensation is a tax-free monetary benefit paid monthly to veterans based on the severity of their service-connected disabilities. DoD disability ratings are generally lower than VA disability ratings.

Can a veteran receive both DoD and VA disability compensation?

Generally no, unless you qualify for CRSC or CRDP.

DoD has two programs to provide additional benefits to certain veterans who have lost their DoD disability pay as a result of also receiving VA disability pay: the Combat Related Special Compensation (CRSC) program, and the Concurrent Retirement & Disability Pay (CRDP) program.

Can DoD disability affect VA disability benefits?

DoD disability benefits received through separation or retirement may impact the amount of VA disability compensation a veteran receives, as there can be offsets or reductions to prevent duplication of benefits.

Can a service member apply for VA disability while still in the military?

Yes, service members can apply for VA disability benefits via a Pre-Discharge Claim prior to separation or retirement from the military. You can file the pre-discharge claim for disability benefits between 180 to 90 days before you leave the military.

Are the criteria for determining disability different between DoD and VA?

While there may be some overlap, the criteria for determining disability differ between DoD and VA evaluations. DoD focuses on the impact of the condition on military duty, while VA considers the overall impact on the veteran’s life and future economic loss.

Can a service member appeal a DoD disability rating?

Yes, service members have the right to appeal their DoD disability rating through the process if they believe it does not accurately reflect the impact of their condition on their military service.

Can a veteran appeal a VA disability rating?

Yes, veterans can appeal their VA disability rating if they believe it is inaccurate or if they disagree with the decision made by the VBA regional office.

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