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Retroactive Disability Payments Coming

According to Defense Department and Veterans’ Affairs (VA) sources, some disabled retirees due retroactive pay could
start to see their payments in mid-October if all goes as planned. A small number may see payments before that; however,
VA officials caution that, if any unexpected glitches crop up, the payments will be delayed until the second half of January.
That’s because they’ll have their hands full at the end of the year reprogramming and implementing new pay rates for

Over 100,000 retirees now drawing either Combat-Related Special Compensation (CRSC) or Concurrent Retirement and
Disability Pay (CRDP) ultimately will receive back payments -- and that number is growing daily with new awards. Because
of the complexity of calculating who is due how much (individual circumstances vary widely, and many cases require
manual review), the majority of the payments will likely be phased in from January through next summer.
Why is retroactive pay due? While the VA disability award letter usually establishes a retroactive effective date, the VA
doesn’t initially make retroactive payments for retirees with less than a 100% disability rating. That’s because there’s
usually at least some offset required for retired pay already received. If the VA paid all retroactive awards immediately, it
would cause major headaches for many disabled retirees, who would then have to pay back large amounts of their military
retired pay.

Only if and when a disabled retiree is awarded CRDP or CRSC can the VA find out whether back disability pay is due
- but it needs a ton of data from the Defense Department to figure out how much. On the other hand, retirees who experience
changes in their disability awards may also be due retroactive CRSC/CRDP payments from the Defense Department.

The bottom line is that the new and complicated CRSC and CRDP programs have created major administrative and
budgetary headaches for Pentagon and VA administrators. Their first priority has been to get the pays started while minimizing
confusion or aggravation for disabled retirees. Now, they’ve invested months of combined effort to change their
policies, systems, and budgets to finish the hard part - figuring out who is due how much in retroactive payments. Defense Finance and Accounting Service (DFAS) sources say the affected retirees will receive specific details at the time
their retroactive payment is made. DFAS expects to publish a detailed news release later this month