Military Disability vs. VA Disability

When you leave the military with a medical condition, you may be eligible for disability pay. It’s important to understand that the Department of Defense (DoD) and the Department of Veterans Affairs (VA) each have their own disability programs. Each serves different purposes, has different rules, and affects your benefits in specific ways. 

In the most basic explanation:

• Military Disability is when the military says you’re unfit to serve and forces you to leave.
• VA Disability is when you live with an illness or injury suffered while serving, but you chose to stay and continue serving. Another aspect of VA disability is that it is often filed with the VA following your separation as a Veteran.

I will walk you through the key differences between military disability and VA disability so you know what to expect—and what benefits you’re eligible to receive. 

What Is Military Disability?

Military disability compensation, sometimes called DoD Disability, is provided by the DoD to servicemembers who are injured or become ill while on active duty and are no longer fit to continue military service. It is part of the DoD Disability Evaluation System (DES) that the military’s Physical Evaluation Board administers and may lead to medical separation or medical retirement.

Note: Military retirement and medical retirement are not the same, mainly because, in the medical retirement process, you may not be deemed eligible to receive retirement pay due to your condition’s severity and your years of service.

Medical Separation vs. Medical Retirement

The percentage of your military disability will determine the compensation you receive. The Physical Evaluation Board’s ratings decide if you receive a military retirement or separation.

Medical separation occurs when your condition is rated at less than 30% and you’re deemed unfit for duty. You’ll receive a one-time severance payment but no military retirement pay. Any severance pay from the DoD is deducted from any later-awarded VA benefits for the same disability unless the disability resulted from a combat-related event or occurred in the line of duty in a combat zone.

Medical retirement happens if you have fewer than 20 years of active service, your condition is rated at 30% or more, and you’re found unfit for duty. From there, you’re placed on one of two lists:

• The Temporary Disability Retired List (TDRL)
• The Permanent Disability Retired List (PDRL)

If you have more than 20 years of active service, your retirement will be recommended regardless of your rating.

Temporary Disability Retired List (TDRL)

The Temporary Disability Retired List (TDRL) is a status assigned to servicemembers found unfit for duty due to a medical condition that may improve over time. If placed on the TDRL, you get retirement pay and medical benefits, but you must go through evaluations to see if the condition improves or worsens. 

Permanent Disability Retired List (PDRL)

The Permanent Disability Retired List (PDRL) is for servicemembers with a medical condition that makes them unfit for duty and is not expected to improve. If placed on the PDRL, you receive monthly retirement pay and keep your military medical benefits for life. You don’t need any more medical exams or reviews — your condition is considered permanent, and your military career is officially over.

Note: If you have a disability before entering the military, it may be recommended you separate without benefits. 

Military Disability Ratings

There are some important need-to-knows when it comes to military disability ratings.

First, when you receive a military disability rating, it is permanent. Period. If the DoD assesses you with a 40% disability and you receive retirement, your rating will never increase or change. Second, your time in service, rank, and disability percentage are all considered when determining your rating. Third, military disability ratings tend to focus specifically on the illness or injury. That comes into play later when comparing it to VA disability. 

Receiving a permanent disability rating between 30% and 50% from the DoD means you’re eligible for healthcare with military disability retirement benefits but may have a lower priority for VA healthcare benefits. Ratings higher than 50% get priority in the VA healthcare system. 

What Is VA Disability Compensation?

VA disability compensation, or VA disability pay, is a benefit the Department of Veterans Affairs provides. You’re eligible to receive it if you’re a Veteran with a service-connected injury or illness, regardless of how long you served or whether you were medically separated or retired. However, you need to file a claim with the VA.

VA Disability Basics

VA disability benefits are the better-known benefit. You can receive a VA disability rating for a medical condition received or aggravated during your active military service.

To receive VA disability pay, you must file a claim with the VA. This process can be a bit long and tedious. If the VA awards a disability rating, you’ll begin to receive tax-free monthly payments from the VA. Often, the pay involves back pay dating back to your intent-to-file date. VA disability pay can also be adjusted based on whether you have a spouse or children or are a caregiver to your parents.

VA Disability Ratings

VA disability ratings range from 0% to 100%. But that rating can increase if conditions worsen your quality of life as you age. The biggest eligibility hurdle is proving the condition’s connection to service. Another aspect of filing for VA disability is that the rating you receive may be lower than you believe it should be or expected. In that case, you can appeal the rating. 

VA disability ratings take a holistic view of your quality of life. As mentioned earlier, military disability simply evaluates the severity of the particular injury in-question and how impacts your fitness for duty. VA disability ratings take into account the severity of the injury, but also how that injury affects your everyday life and activities.

Comparing Military Disability and VA Disability

Feature	DoD Disability / Military Disability	VA Disability
Purpose	Determines fitness for duty	Compensates for service-connected injuries
Timeline	Rating given before the servicemember leaves active service	A Veteran must file a claim once leaving service/in the process of leaving service
Administered by	Department of Defense (DoD)	Department of Veterans Affairs
Rating Source	Based on only unfitting conditions, rank, and time in service	Rates all service-connected conditions, holistic impact of condition on life
Ratings System	0%–100%, but only unfitting conditions, permanent	0%–100% overall disability rating, able to change if conditions worsen over time
Payment Type	Retirement pay or severance, possibly taxed (based on where you live)	Monthly, tax-free compensation
Eligibility	Must be unfit for duty due to condition	Must prove condition is service-connected

Receiving Both DoD Retirement and VA Disability Benefits

You can receive both DoD disability retirement pay and VA disability compensation but not always in full at the same time. Usually, if you get VA disability payments, the government reduces your DoD retirement pay by that amount dollar-for-dollar, often referred to as the “VA offset.” 

However, programs like Concurrent Retirement and Disability Pay (CRDP) and Combat-Related Special Compensation (CRSC) can help you get both types of payments without losing money to the offset. If you qualify for one of these programs, you might receive most or all of your military retirement pay and your VA disability payments together. 

If you’re eligible to receive both military disability and VA disability but aren’t sure which one to receive, it would be wise to compare the two options and choose what’s best for you. 

Final Thoughts

Understanding the difference between DoD and VA disability is critical when transitioning out of military service. The DoD evaluates your ability to continue serving, while the VA focuses on how your service-connected conditions affect your civilian life. Knowing how each system works ensures you don’t miss out on the benefits you’ve earned.

If you’re unsure where to start, contact a Veterans Service Organization (VSO) or an accredited claims agent to help guide you through the process.