How would passage of the Major Richard Star Act alter who receives full concurrent retirement and VA disability pay?
Executive summary
The Major Richard Star Act would expand eligibility for "concurrent receipt" by eliminating the dollar‑for‑dollar offset that now reduces Department of Defense (DoD) retired pay when a medically retired service member receives Department of Veterans Affairs (VA) disability compensation, allowing a specific group of combat‑injured retirees to collect full DoD retirement pay and full VA disability pay at the same time [1] [2]. In practice the bill targets roughly 50,000–54,000 combat‑disabled veterans—those who were medically retired for combat or combat‑related injuries, who qualify for Combat‑Related Special Compensation (CRSC) but have fewer than 20 years of service—and would give them the option to receive Concurrent Retirement and Disability Pay (CRDP) instead of CRSC [3] [4] [5] [6].
1. What the law does now and whom it leaves out
Under current law, retirees who completed 20 or more years of service (and certain others) generally can receive DoD retired pay and VA disability compensation without offsets, but medically retired service members who left before 20 years and have VA ratings below historical thresholds can see their DoD retired pay reduced dollar‑for‑dollar by the amount of VA disability compensation they receive—effectively forcing some combat‑injured vets to choose between full retirement or full disability benefits [7] [8] [9].
2. Who the Star Act would add to concurrent receipt and how
The Star Act would remove that offset for combat‑injured retirees who are eligible for CRSC but who have fewer than 20 years of creditable service, allowing them to receive both full DoD retirement pay and full VA disability compensation concurrently; the bill explicitly extends concurrent receipt to this subgroup and would create an option during an open‑season process to switch from CRSC to CRDP if a veteran prefers [2] [5] [6].
3. Scale, fiscal estimates and the mechanics veterans would face
Veterans service organizations and reporting place the eligible population at roughly 50,000–54,000 retirees who now face the offset, with Congressional Budget Office and other estimates projecting multibillion‑dollar costs over a decade—CBO cited roughly $9.75 billion over 2024–2033 while some advocacy estimates put the 10‑year cost near $8 billion, noting the true cost could be lower because some veterans may keep tax‑free CRSC instead of switching to CRDP [3] [10] [11].
4. The beneficiary choice and tax/benefit tradeoffs
Passage would not force a one‑size‑fits‑all change; veterans who qualify for CRSC would be offered a choice during an open season between remaining in CRSC (which is described as tax‑free in advocacy materials) or opting into CRDP to receive the combined full retirement and VA compensation—individuals will have to weigh tax consequences, family considerations, and which option yields higher net income [6] [11] [12].
5. Competing arguments and political context
Supporters frame the bill as closing the remaining "wounded veteran tax" and completing a decades‑long expansion of concurrent receipt for combat‑injured veterans, arguing moral and recruitment implications; critics and fiscal conservatives emphasize the multibillion dollar budget impact and caution about expanding earned retirement benefits without offsets—Congressional advocates are bipartisan but the legislation has repeatedly stalled despite wide VSO backing [4] [10] [3].
6. What reporting does not fully resolve
Public reporting and advocacy materials make the overall effect clear—who would become newly eligible and that the offset would end—but detailed administrative transitions, actuarial assumptions used by CBO, and the final choice architecture (timing, notices, and tax reporting implications for every affected retiree) require reference to implementing guidance from DoD/DFAS and final legislative text, which are not exhaustively detailed in the sources provided [2] [11] [10].