This is the accessible text file for GAO report number GAO-14-854R entitled 'Disability Compensation: Review of Concurrent Receipt of Department of Defense Retirement, Department of Veterans Affairs Disability Compensation, and Social Security Disability Insurance' which was released on October 30, 2014. This text file was formatted by the U.S. Government Accountability Office (GAO) to be accessible to users with visual impairments, as part of a longer term project to improve GAO products' accessibility. Every attempt has been made to maintain the structural and data integrity of the original printed product. Accessibility features, such as text descriptions of tables, consecutively numbered footnotes placed at the end of the file, and the text of agency comment letters, are provided but may not exactly duplicate the presentation or format of the printed version. The portable document format (PDF) file is an exact electronic replica of the printed version. We welcome your feedback. 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Washington, DC 20548: September 30, 2014: The Honorable Tom Coburn, M.D. Ranking Member: Committee on Homeland Security and Governmental Affairs: United States Senate: Disability Compensation: Review of Concurrent Receipt of Department of Defense Retirement, Department of Veterans Affairs Disability Compensation, and Social Security Disability Insurance: Dear Dr. Coburn: The Social Security Disability Insurance (SSDI) trust fund faces serious fiscal-sustainability challenges. The Social Security Board of Trustees projects that the SSDI trust fund, which provides benefits to individuals who cannot work due to a medical condition that is expected to last at least 1 year or result in death, will be exhausted in 2016 and notes that changes designed to improve the financial status of the SSDI program are needed soon.[Footnote 1] In a July 2012 report, we identified over 100,000 SSDI beneficiaries who received concurrent cash-benefit payments from the SSDI and unemployment- insurance programs.[Footnote 2] Given the findings of that report, you asked us to examine other federal benefit programs that could be overlapping with disability programs administered by the Social Security Administration (SSA). This report formally transmits the briefing slides presented to your staff on September 26, 2014 (see enclosure I), and provides additional details. Current law allows individuals to receive concurrent military retirement benefits from the Department of Defense (DOD), Department of Veterans Affairs (VA) disability compensation, and SSDI. This report identifies the number of disabled military personnel who received concurrent benefit payments from DOD retirement, VA disability compensation, and SSDI during fiscal year 2013. It also provides seven case-study examples of disabled military personnel receiving concurrent benefits. Out of the 1.9 million DOD nondisability and disability retirees, we identified 59,251 individuals who received concurrent payments in fiscal year 2013 from DOD retirement, VA disability compensation, and SSDI. The payments totaled over $3.5 billion. From our population of individuals receiving concurrent payments, we also selected a random sample of seven individuals to provide illustrative examples. These seven examples individually received from $19,210 to $152,719 in concurrent benefits. To perform our work, we obtained payment and beneficiary information from DOD, VA, and SSA for fiscal year 2013 to identify those who received benefits from all three programs and summed the monthly payment amounts from each program to determine the total amount of benefits. We also reviewed laws and regulations governing concurrent disability and retirement benefits. To determine the reliability of the DOD retirement, VA disability compensation, and SSDI data, we interviewed officials responsible for compiling and maintaining relevant data. In addition, we performed electronic testing to determine the validity of the data in the databases that we used to perform our work. On the basis of our discussions with agency officials and our own testing, we concluded that the data used for this report were sufficiently reliable for our purposes. In addition to our overall analysis, we randomly selected seven individuals on the basis of payments received from all three benefit programs in fiscal year 2013 to illustrate instances of concurrent receipt of benefits. To randomly select individuals who received concurrent benefits, we stratified our sample of individuals receiving concurrent payments into seven categories by total concurrent income and randomly selected one individual from each stratum. We summarized information from DOD, VA, and SSA data files and verified the information with knowledgeable agency officials. Because we selected a small number of individuals for illustration, the results cannot be projected to the entire population of individuals receiving such benefits. We conducted this performance audit from December 2013 to September 2014 in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. Background: Disabled military personnel may be entitled to receive support from three separate federal benefit programs, under certain conditions: (1) DOD nondisability or disability retirement,[Footnote 3] (2) VA disability compensation,[Footnote 4] and (3) SSDI.[Footnote 5] 1. DOD retirement. * Nondisability DOD retirement from active service. The current DOD retirement system allows military personnel to obtain retirement pay after completing at least 20 years of service. Retirement pay is usually calculated based on the basic pay that military personnel received at retirement and the number of years they served. In some cases, individuals with more than 40 years of service could receive over 100 percent of their base pay. In addition, retiree pay is adjusted annually by cost-of-living adjustments (COLA). This pay is subject to federal income taxes. * Disability DOD retirement. Under most circumstances, military personnel are eligible for disability retirement pay if they have served on active duty for more than 30 days before incurring a disability that leaves them unfit for duty. Disability retirement pay is usually based on the individual's percentage of disability, number of years of service, and basic pay. This pay cannot exceed 75 percent of base pay and, depending on other criteria, may or may not be subject to federal income taxes. The average individual amount paid annually to military nondisability and disability retirees for fiscal year 2013 was $28,416. 2. VA disability compensation. Disabled military personnel who have service-connected disabilities resulting from injuries or diseases incurred or aggravated by military service may receive benefits under the veterans' disability compensation system. The individual monthly disability compensation payment is determined by the individual's percentage of disability, family composition, and entitlement to special monthly compensation due to the loss of, or loss of the use of, certain extremities or other qualifying factors. VA disability compensation is tax-exempt. The average individual amount paid annually for fiscal year 2013 was $13,131. 3. SSDI. Disabled military personnel may also be eligible to receive compensation from the SSDI program if they have a medically determinable physical or mental impairment that (1) has lasted (or is expected to last) at least 1 year or is expected to result in death and (2) prevents the individual from engaging in substantial gainful activity (SGA).[Footnote 6] There are no percentage ratings or partial disability determinations for SSDI benefits. SSDI benefit amounts are based on an individual's career earnings covered by Social Security. Individuals who have substantial income in addition to Social Security benefits may pay taxes on a portion of their benefits. The average individual amount paid annually as of December 2013 was $11,953. Federal law provides for the concurrent receipt of the DOD retirement, VA disability compensation, and SSDI compensation benefits, although the terms of receipt have changed over time since 2004. Before 2004, laws and regulations stipulated that military retirees could not concurrently receive the full amount of their DOD retirement and VA disability compensation. As a result, military retirees with physical disabilities recognized by the VA had their retirement pay offset dollar-for-dollar by the amount of their VA compensation. Under a program that began on January 1, 2004, however, the offset was phased out for certain individuals by 10 percent per year over a 10-year period.[Footnote 7] For the fiscal year 2013 payment data in our analysis, the prior offset had been reduced by 90 percent. Starting in January 2014, veterans who qualify receive the full amount of their VA disability compensation and DOD retirement benefits concurrently with no offset. Military personnel who do not qualify have the option of choosing between receiving DOD retirement offset by VA disability compensation or waiving DOD retirement and receiving VA disability compensation. SSDI benefits do not affect the receipt of DOD disability or nondisability retirement. Number of Disabled Military Personnel Who Received Concurrent Benefit Payments from DOD Retirement, VA Disability Compensation, and SSDI during Fiscal Year 2013: Out of the 1.9 million DOD nondisability and disability retirees, we identified 59,251 individuals who received concurrent payments in fiscal year 2013 from DOD retirement, VA disability compensation, and SSDI. The payments totaled over $3.5 billion. From our total population of 59,251 individuals, we found the following: * A total of 40,179 (or 68 percent) each received between $25,000 and $74,999 in total compensation. * A total of 2,304 (or 4 percent) each received concurrent payments of $100,000 or more, with the highest beneficiary, who retired at pay grade O-8, receiving $208,757 in fiscal year 2013. * The age of the individuals receiving concurrent payments ranged from 19 to 66, with almost half (28,626, or 48 percent) of the individuals being age 60 or above as of January 2013. * The combined benefits from the three programs for individuals age 60 or above totaled approximately $1.7 billion. * A total of 48,127 (or 81 percent) had a VA disability rating equal to or greater than 50 percent. * A total of 10,289 (or 17 percent) received compensation due to a combat-related disability. As previously stated, current law generally allows military personnel to receive concurrent disability compensation from DOD, VA, and SSA, under certain conditions. We randomly selected seven individuals who received concurrent benefits to provide illustrative examples of such instances. The total concurrent benefits received in fiscal year 2013 for each individual ranged from $19,210 to $152,719. Agency Comments: We provided a draft of this report to the Acting Commissioner of Social Security, the Secretary of Defense, and the Secretary of Veterans Affairs for review and comment. In written comments, which are reproduced in enclosure II, SSA said that it did not have any comments. DOD did not comment on the report's findings but provided technical comments, which we have incorporated as appropriate. In written comments, reproduced in enclosure III, VA said that it generally agreed with the report's conclusions. VA also provided technical comments, which we have incorporated as appropriate. As agreed with your office, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the report date. At that time, we will send copies of this report to the Acting Commissioner of Social Security, the Secretary of Defense, the Secretary of Veterans Affairs, and other interested parties. In addition, the report will be available at no charge on the GAO website at [hyperlink, http://www.gao.gov]. If you or your staff have any questions regarding this report, please contact me at (202) 512-6722, or BagdoyanS@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. Sincerely yours, Signed by: Seto J. Bagdoyan: Acting Director, Forensic Audits and Investigative Service: Enclosures--3: Footnotes: [1] The 2014 Annual Report of the Board of Trustees of the Federal Old- Age and Survivors Insurance and Federal Disability Insurance Trust Funds (Washington, D.C.: July 28, 2014). [2] GAO, Income Security: Overlapping Disability and Unemployment Benefits Should Be Evaluated for Potential Savings, [hyperlink, http://www.gao.gov/products/GAO-12-764] (Washington, D.C.: July 31, 2012). [3] 10 U.S.C. §§ 1401-1414. The overall DOD retirement program consists of both nondisability and disability retirement. [4] 38 U.S.C. §§ 1101-1163. [5] 42 U.S.C. §§ 401-434. [6] SGA is defined as work activity that involves significant physical or mental activities performed for pay or profit. [7] Military nondisability retirees with a combined VA disability rating of 50 percent or greater who are entitled to retired pay have their offset eliminated under this Concurrent Retirement and Disability Pay (CDRP) Program. The program also applies to military disability retirees with a combined VA disability rating of 50 percent or greater and at least 20 years of military service, but only to the extent that the amount of the disability retirement does not exceed the amount of retired pay to which the retiree would have been entitled under a nondisability retirement. [End of section] Enclosure I: Disability Compensation: Review of Concurrent Receipt of Department of Defense Retirement, Department of Veterans Affairs Disability Compensation, and Social Security Disability Insurance: Briefing to Congressional Requester: September 26, 2014: Introduction: Social Security Disability Insurance Trust Fund Status: The Social Security Disability Insurance (SSDI) trust fund, which provides benefits to individuals who cannot work due to a medical condition that is expected to last at least one year or result in death, faces serious fiscal-sustainability challenges. * The Social Security Board of Trustees projects that the SSDI trust fund reserves will be exhausted in 2016 and notes that changes designed to improve the financial status of the SSDI program are needed soon.[Footnote 1] * In a report we issued in July 2012,[Footnote 2] we identified over 100,000 SSDI beneficiaries who received concurrent cash-benefit payments from the SSDI and unemployment-insurance programs totaling more than $850 million. * Current law allows individuals to receive concurrent Department of Defense (DOD) military retirement pay, Department of Veteran Affairs (VA) disability compensation, and SSDI. Scope and Methodology – Objective 1: To identify individuals who received concurrent benefit payments during fiscal year 2013, we: * obtained payment and beneficiary information from DOD, VA, and SSA, for fiscal year 2013, * identified individuals who received benefits from all three programs, * summed the monthly payment amounts from each program to determine the total amount of benefits for each individual. To assess the reliability of DOD, VA, and SSA data we interviewed knowledgeable agency officials, reviewed existing information, and performed electronic testing on the data. We determined that the data were sufficiently reliable for our purposes. Scope and Methodology – Objective 2: To randomly select seven individuals who received concurrent benefit payments during fiscal year 2013, we: * stratified our sample of individuals receiving concurrent payments into seven categories by total concurrent income, * randomly selected an individual from each of the seven strata, and, * summarized information from DOD, VA, and SSA data files, * verified accuracy of payment data by confirming information with knowledgeable agency officials. Because we selected a small number of individuals for illustration, the results cannot be projected to the entire population of individuals receiving such benefits, but provide illustrative examples. We conducted this performance audit from December 2013 to September 2014 in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. Summary: Out of 1.9 million DOD non-disability and disability retirees, we identified 59,251 individuals who received concurrent payments in fiscal year 2013 from DOD retirement, VA disability compensation, and SSDI. The payments totaled over $3.5 billion. Characteristics of 59,251 individuals: * A total of 40,179 (or 68 percent) received between $25,000 and $74,999 in total compensation. * A total of 2,304 (or 4 percent) received concurrent payments of $100,000 or more, with the highest beneficiary receiving $208,757 in fiscal year 2013. * The age of the individuals receiving concurrent payments ranged from 19 to 66, with almost half (28,626, or 48 percent) of the individuals age 60 or above as of January 2013. - The combined benefits for these individuals age 60 or above totaled $1.7 billion. * A total of 48,127 (or 81 percent) had a VA disability rating equal or greater than 50 percent. * A total of 10,289 (or 17 percent) received compensation due to a combat-related disability. We randomly selected a total of seven individuals to illustrate instances of concurrent benefits. There were a range of diagnosis codes and the total concurrent benefits received in fiscal year 2013 for each individual ranged from $19,210 to $152,719. Background: Department of Defense (DOD) Retirement: Military personnel who have served at least 20 years may collect non- disability retirement. * Retired pay is usually calculated on the basis of basic pay and number of years in service. * Adjusted annually by cost-of-living adjustments (COLA). Under most circumstances, disability retirement is available for military personnel who have served on active duty more than 30 days, have a disability rated as 30 percent or greater,[Footnote 3] and who are determined unfit for duty. * Disability retirement is usually based on the percentage of disability, number of years in service, and the base pay received before experiencing the disability. * This pay cannot exceed 75 percent of base pay and, depending on certain criteria, may or may not be subject to federal income tax. The average individual amount paid annually to military non-disability and disability retirees for fiscal year 2013 was $28,416. There were 1.9 million DOD non-disability and disability retirees as of September 30, 2013. Background: Veterans Affairs (VA) Disability Compensation: VA provides monthly disability compensation to most veterans who have service-connected disabilities resulting from injuries or diseases incurred or aggravated by military service. Payments vary greatly and depend on, among other things, the percentage of the disability,[Footnote 4] family composition, and entitlement to special monthly compensation.[Footnote 5] The average individual amount paid annually for fiscal year 2013 was $13,131. VA disability compensation is tax-exempt. There were 3.7 million VA disability compensation recipients as of September 30, 2013. Background: Social Security Disability Insurance (SSDI): The SSDI program is a nationwide federal assistance program administered by SSA that provides income for individuals who have a physical or mental impairment that: * has lasted (or is expected to last) at least 1 year or is expected to result in death and, * prevents the individual from engaging in Substantial Gainful Activity (SGA).[Footnote 6] There are no percentage ratings or partial disability determinations for SSDI benefits. SSDI benefit amounts are based on an individual's career earnings covered by Social Security. Individuals who have substantial income in addition to Social Security benefits may pay taxes on a portion of their benefits. The average individual amount paid annually as of December 2013 was $11,953. There were 10.9 million SSDI beneficiaries as of December 2013. Background: Concurrent Receipt of Benefits: Figure 1. Some military personnel may receive cash benefits concurrently: [Refer to PDF for image: illustration] Current law allows individuals to receive concurrent disability compensation from the Social Security Administration's (SSA) disability insurance (SSDI) program and the Department of Veterans Affairs (VA) disability compensation program. Some individuals may receive concurrent disability compensation from VA and military retirement benefits from the Department of Defense (DOD). Further, some individuals may receive cash benefits concurrently from all three programs. Concurrent receipt of VA disability compensation and DOD retirement allowed without offsets under 10 U.S.C. § 1414(a) and (b) (Subject to certain requirements and limits). Concurrent receipt of VA disability compensation and SSA disability insurance allowed under 42 U.S.C. § 424a(a)(2)(B)(i). Recipient can receive: VA disability compensation; DOD military retirement benefits; SSA's disability insurance benefits. Source: GAO. GAO-14-854R. [End of figure] Background: Offsets for DOD Retirement and VA Disability Compensation: Through calendar year 2003, retirement pay earned from DOD for military service was offset by any payment received from VA disability compensation under certain circumstances. Beginning with the National Defense Authorization Act (NDAA) for fiscal year 2002,[Footnote 7] legislation has been enacted that increasingly reduces or eliminates the offset of DOD retired pay and VA disability compensation under certain circumstances. The offset reduction was phased in over 10 years from 2004 to 2013. For 2013, the offset for military personnel had diminished to 10 percent; that is, military personnel received 90 percent concurrent pay, with 10 percent offset. Figure 2. DOD retirement and VA disability are generally allowed without offset: [Refer to PDF for image: illustration] Concurrent receipt of VA disability compensation and DOD retirement allowed without offsets under 10 U.S.C. § 1414(a) and (b) (Subject to certain requirements and limits). Recipient can receive: VA disability compensation; DOD military retirement benefits. Source: GAO. GAO-14-854R. [End of figure] Military personnel falling into one of the categories below do not have retirement offset: Concurrent Retirement and Disability Pay (CRDP)–-eliminates VA disability offset: * Disability retirement - must have VA disability rating of 50 percent or greater and at least 20 years of service. However, CRDP does not apply to any amount in excess of what would have been received had the individual received a non-disability retirement. * Non-disability retirement--must have VA disability rating of 50 percent or greater and be entitled to retired pay. Combat Related Special Compensation (CRSC) program--tax-free entitlement: * Combat-related injury incurred as a direct result of armed conflict, hazardous duty, instrumentality of war, or simulated war. * VA disability rating of at least 10 percent. * Military personnel cannot receive both CRDP and CRSC. Military personnel who do not fall within either of the two categories above have the option of choosing between receiving DOD retirement offset by VA disability compensation or waiving DOD retirement and receiving VA disability compensation. Figure 3. DOD military retirement benefits may be offset if military personnel are not eligible for either program: [Refer to PDF for image: illustration] VA disability compensation and DOD military retirement benefits: * No offset: Concurrent Retirement Disability Pay (CRDP): 10-year phase-in schedule that began in 2004. * No offset: Combat Related Special Compensation (CRSC): Not subject to phase-in schedule. * Offset. Source: GAO. GAO-14-854R. [End of figure] Background: Concurrent SSDI and VA Disability Compensation: * Concurrent receipt of SSDI and VA disability compensation is legally permitted.[Footnote 8] * In contrast, benefits from other federal, state, and local disability programs are offset against SSDI benefits so that the total benefits do not exceed 80 percent of predisability earnings. Figure 4. VA disability compensation and SSDI allowed without offset: [Refer to PDF for image: illustration] Concurrent receipt of VA disability compensation and SSA disability insurance allowed under 42 U.S.C. § 424a(a)(2)(B)(i). Recipient can receive: VA disability compensation; SSA's disability insurance benefits. Source: GAO. GAO-14-854R. [End of figure] Background: Concurrent SSDI and DOD Retirement: * SSDI benefits do not affect DOD retirement pay. * SSDI benefits are not offset for DOD benefits, regardless of whether an individual has a disability.[Footnote 9] DOD retirement does not meet SSA's definition of earned income. Figure 5. DOD military retirement and SSDI allowed without offset: [Refer to PDF for image: illustration] Recipient can receive: DOD military retirement benefits; SSA's disability insurance benefits. Source: GAO. GAO-14-854R. [End of figure] Background: Outreach to Veterans Directed by Congress: Congress has focused increased attention on care for recovering military personnel, including efforts to ensure they receive their entitled benefits. The National Defense Authorization Act (NDAA) for Fiscal Year 2008 required DOD and VA to consult with other relevant federal agencies and develop a comprehensive policy for improving case management for recovering military personnel and veterans. DOD and VA have developed several new programs designed to help disabled military personnel heal and transition back to their military duties or civilian life. For example, DOD's Warrior Transition Brigade program helps disabled military personnel learn about and apply for SSDI benefits. Objective 1: Concurrent Benefits Paid in Fiscal Year 2013: Figure 6. Summary of concurrent benefits paid to more than 59,000 individuals totaling over $3.5 billion in fiscal year 2013: [Refer to PDF for image: table] Group: Highest combined benefit; Number of individuals: 1; Percentage of total: [Empty]; Dollar amount: $208,757. Group: Lowest combined benefit; Number of individuals: 1; Percentage of total: [Empty]; Dollar amount: $2,109. Group: Received $25,000-$74,999 in benefits; Number of individuals: 40,179; Percentage of total: 68%; Dollar amount: $2,132,883,704. Group: VA disability rating equal or greater than 50 percent; Number of individuals: 48,127; Percentage of total: 81%; Dollar amount: $3,132,863,290. Group: Age 60 and over as of January 2013; Number of individuals: 28,626; Percentage of total: 48%; Dollar amount: $1,731,544,306. Group: Combat-related disability; Number of individuals: 10,289; Percentage of total: 17%; Dollar amount: $605,956,296. Source: GAO analysis of data from DOD, VA, and SSA. GAO-14-854R. [End of figure] Figure 7. Concurrent benefits received by individual: [Refer to PDF for image: table] Range of concurrent benefits received in fiscal year 2013: $0-24,999 Number of individuals: 4,324; Total fiscal year 2013 benefits paid: $81,110,882. Range of concurrent benefits received in fiscal year 2013: $25,000- $49,999 Number of individuals: 17,101; Total fiscal year 2013 benefits paid: 650,020,197. Range of concurrent benefits received in fiscal year 2013: $50,000– $74,999 Number of individuals: 23,078; Total fiscal year 2013 benefits paid: 1,482,863,507. Range of concurrent benefits received in fiscal year 2013: $75,000– $99,999 Number of individuals: 12,444; Total fiscal year 2013 benefits paid: 1,033,005,052. Range of concurrent benefits received in fiscal year 2013: $100,000- $124,999 Number of individuals: 1,834; Total fiscal year 2013 benefits paid: 200,858,337. Range of concurrent benefits received in fiscal year 2013: $125,000– $149,999 Number of individuals: 369; Total fiscal year 2013 benefits paid: 49,666,070. Range of concurrent benefits received in fiscal year 2013: $150,000 and above Number of individuals: 101; Total fiscal year 2013 benefits paid: 16,359,228. Total: Number of individuals: 59,251; Total fiscal year 2013 benefits paid: 3,513,883,272. Note: Total column does not add up to figure due to rounding. Source: GAO analysis of data from DOD, VA, and SSA. GAO-14-854R. [End of figure] Figure 8. Concurrent benefits paid by age: [Refer to PDF for image: table] Age: Under 30; Number of individuals: 1,725; Percentage of total: 3%; Total fiscal year 2013 benefits paid: $52,271,371. Age: 30-39; Number of individuals: 2,766; Percentage of total: 5%; Total fiscal year 2013 benefits paid: $107,492,771. Age: 40-49; Number of individuals: 6,153; Percentage of total: 10%; Total fiscal year 2013 benefits paid: $382,678,719. Age: 50-59 Number of individuals: 19,981; Percentage of total: 34%; Total fiscal year 2013 benefits paid: $1,239,896,104. Age: 60 and over Number of individuals: 28,626; Percentage of total: 48%; Total fiscal year 2013 benefits paid: $1,731,544,306. Total: Number of individuals: 59,251; Percentage of total: 100%; Total fiscal year 2013 benefits paid: $3,513,883,272. Note: Total column does not add up to figure due to rounding. The age of beneficiaries ranged from 19 to 66. Source: GAO analysis of data from DOD, VA, and SSA. GAO-14-854R. [End of figure] Figure 9: Concurrent benefits paid by agency: [Refer to PDF for image: table] Agency: Department of Veterans Affairs (VA); Total of all benefits paid in fiscal year 2013: $1,406,436,021. Agency: Department of Defense (DOD); Total of all benefits paid in fiscal year 2013: $1,169,997,900. Agency: Social Security Administration (SSA); Total of all benefits paid in fiscal year 2013: $937,449,351. Total: Total of all benefits paid in fiscal year 2013: $3,513,883,272. Source: GAO analysis of data from DOD, VA, and SSA. GAO-14-854R. [End of figure] Objective 2: Case-Study Example of Individual Receiving Concurrent Benefits ($1-$24,999 stratum): Age on January 1, 2013: 27; Year retired: 2011; Pay grade at retirement (see Appendix I): E-4; Years of service: 6; Impairment diagnoses include, among others: Lung disease; multiple neurological conditions; Combat benefits included: No; Fiscal year benefits: $19,210: $7,966: DOD retirement; $7,845: VA disability compensation; $3,399: SSA disability insurance. Objective 2: Case-Study Example of Individual Receiving Concurrent Benefits ($25,000-$49,999 stratum): Age on January 1, 2013: 63; Year retired: 1987; Pay grade at retirement (see Appendix I): E-6; Years of service: 20; Impairment diagnoses include, among others: Endocrine system disorder; limitation of motion in spine; Combat benefits included: No; Fiscal year benefits: $37,765: $15,258: DOD retirement; $3,052: VA disability compensation; $19,455: SSA disability insurance. Objective 2: Case-Study Example of Individual Receiving Concurrent Benefits ($50,000-$74,999 stratum): Age on January 1, 2013: 62; Year retired: 1991; Pay grade at retirement (see Appendix I): E-7; Years of service: 20; Impairment diagnoses include, among others: Heart disease; endocrine system disorder; arthritis; Combat benefits included: No; Fiscal year benefits: $62,867: $16,954: DOD retirement; $29,013: VA disability compensation; $16,900: SSA disability insurance. Objective 2: Case-Study Example of Individual Receiving Concurrent Benefits ($75,000-$99,999 stratum): Age on January 1, 2013: 60; Year retired: 2002 ; Pay grade at retirement (see Appendix I): E-8; Years of service: 21; Impairment diagnoses include, among others: Neurological condition; arthritis; hearing loss; Combat benefits included: No; Fiscal year benefits: $81,738: $26,722: DOD retirement; $35,578: VA disability compensation; $19,438: SSA disability insurance. Objective 2: Case-Study Example of Individual Receiving Concurrent Benefits ($100,000-$124,999 stratum): Age on January 1, 2013: 54; Year retired: 1997; Pay grade at retirement (see Appendix I): E-6; Years of service: 20; Impairment diagnoses include, among others: Loss of use of feet; lung disease; vascular disease; Combat benefits included: No; Fiscal year benefits: $114,891; $17,664: DOD retirement; $85,958: VA disability compensation; $11,269: SSA disability insurance. Objective 2: Case-Study Example of Individual Receiving Concurrent Benefits ($125,000-$149,999 stratum): Age on January 1, 2013: 65; Year retired: 2005; Pay grade at retirement (see Appendix I): O-6; Years of service: 28; Impairment diagnoses include, among others: Lung disease; neurological condition; arthritis; Combat benefits included: No; Fiscal year benefits: $135,889: $89,272: DOD retirement; $37,720: VA disability compensation; $8,897:SSA disability insurance. Objective 2: Case-Study Example of Individual Receiving Concurrent Benefits (greater than or equal to $150,000 stratum): Age on January 1, 2013: 59; Year retired: 2004; Pay grade at retirement (see Appendix I): E-9; Years of service: 26; Impairment diagnoses include, among others: Loss of feet; renal involvement in systemic diseases; blindness in 1 eye; Combat benefits included: No; Fiscal year benefits: $152,719: $46,396: DOD retirement; $85,958: VA disability compensation; $20,365: SSA disability insurance. [End of section] Appendix I: Military Basic Pay for Officers--Effective January 1, 2013: Figure 10: 2013 Basic Pay Schedule for Officers: [Refer to PDF for image: table] Pay grade[A]: O-10; Years of service: Over 24: $195,883.20; Over 30: $212,972.40. Pay grade[A]: O-9; Years of service: Over 24: $172,897.20; Over 30: $187,912.80. Pay grade[A]: O-8; Years of service: 2 or fewer: $118,173.60; Over 6: $128,538.00; Over 12: $140,220.00; Over 18: $152,402.40; Over 24: $162,147.60; Over 30: $166,204.80. Pay grade[A]: O-7; Years of service: 2 or fewer: $98,190.00; Over 6: $09,580.40; Over 12: $119,512.80; Over 18: $143,096.40; Over 24: $143,096.40; Over 30: $146,703.60. Pay grade[A]: O-6; Years of service: 2 or fewer: $72,777.60; Over 6: $85,525.20; Over 12: $89,676.00; Over 18: $109,072.80; Over 24: $120,412.80; Over 30: $128,840.40. Pay grade[A]: O-5; Years of service: 2 or fewer: $60,670.80; Over 6: $76,921.20; Over 12: $85,420.80; Over 18: $97,416.00; Over 24: $103,078.80; Over 30: $103,078.80. Pay grade[A]: O-4; Years of service: 2 or fewer: $52,347.60; Over 6: $69,296.40; Over 12: $82,234.80; Over 18: $87,404.40; Over 24: $87,404.40; Over 30: $87,404.40. Pay grade[A]: O-3; Years of service: 2 or fewer: $46,026.00; Over 6: $64,339.20; Over 12: $73,087.20; Over 18: $74,880.00; Over 24: $74,880.00; Over 30: $74,880.00. Pay grade[A]: O-2; Years of service: 2 or fewer: $39,769.20; Over 6: $55,036.80; Over 12: $55,036.80; Over 18: $55,036.80; Over 24: $55,036.80; Over 30: $55,036.80. Pay grade[A]: O-1; Years of service: 2 or fewer: $34,516.80; Over 6: $43,430.40; Over 12: $43,430.40; Over 18: $43,430.40; Over 24: $43,430.40; Over 30: $43,430.40. Source: Defense Finance and Accounting Service abstract of military basic pay. GAO-14-854R. [A] Basic pay for an O-7 to O-10 is limited by Level II of the Executive Schedule, which is $179,700 per year. Basic pay for O-6 and below is limited by Level V of the Executive Schedule, which is $145,700 per year. [End of figure] Figure 11: 2013 Basic Pay Schedule for Officers and Warrant Officers: [Refer to PDF for image: table] Pay grade[A]: O-3; Years of service: Over 6: $64,339.20; Over 12: $73,087.20; Over 18: $79,912.80; Over 24: $79,912.80; Over 30: $79,912.80. Pay grade[A]: O-2; Years of service: Over 6: $55,036.80; Over 12: $62,031.60; Over 18: $63,734.40; Over 24: $63,734.40; Over 30: $63,734.40. Pay grade[A]: O-1; Years of service: 2 or fewer: Over 6: $46,375.20; Over 12: $51,566.40; Over 18: $53,924.40; Over 24: $53,924.40; Over 30: $53,924.40. Pay grade[A]: W-5; Years of service: Over 24: $$92,059.20; Over 30: $100,382.40. Pay grade[A]: W-4; Years of service: 2 or fewer: $47,566.80; Over 6: $56,566.80; Over 12: $65,275.20; Over 18: $74,250.00; Over 24: $83,426.40; Over 30: $88,599.60. Pay grade[A]: W-3; 2 or fewer: $43,434.00; Over 6: $49,658.40; Over 12: $59,346.00; Over 18: $67,777.20; Over 24: $73,846.80; Over 30: $76,194.00. Pay grade[A]: W-2; 2 or fewer: $38,433.60; Over 6: $46,454.40; Over 12: $54,136.80; Over 18: $59,889.60; Over 24: $64,155.60; Over 30: $64,155.60. Pay grade[A]: W-1; 2 or fewer: $33,739.20; Over 6: $42,850.80; Over 12: $50,468.40; Over 18: $56,268.00; Over 24: $58,298.40; Over 30: $58,298.40. Source: Defense Finance and Accounting Service abstract of military basic pay. GAO-14-854R. [A] Applicable to O-1 through O-3 with at least 4 years and 1 day of active duty or more than 1260 points as a warrant and/or enlisted member. [End of figure] Figure 12: 2013 Basic Pay Schedule for Enlisted: [Refer to PDF for image: table] Pay grade: E-9; Years of service: Over 12: $58,770.00; Over 18: $64,288.80; Over 24: $72,824.40; Over 30: $80,920.80. Pay grade: E-8; Years of service: Over 12: $50,410.80; Over 18: $56,646.00; Over 24: $62,218.80; Over 30: $67,096.80. Pay grade: E-7; Years of service: 2 or fewer: $32,702.40; Over 6: $40,284.00; Over 12: $46,508.40; Over 18: $51,372.00; Over 24: $54,874.80; Over 30: $58,773.60. Pay grade: E-6; Years of service: 2 or fewer: $28,285.20; Over 6: $35,226.00; Over 12: $41,943.60; Over 18: $43,808.40; Over 24: $43,808.40; Over 30: $43,808.40. Pay grade: E-5; Years of service: 2 or fewer: $25,912.80; Over 6: $32,490.00; Over 12: $36,770.40; Over 18: $36,770.40; Over 24: $36,770.40; Over 30: $36,770.40. Pay grade: E-4; Years of service: 2 or fewer: $23,756.40; Over 6: $28,839.60; Over 12: $28,839.60; Over 18: $28,839.60; Over 24: $28,839.60; Over 30: $28,839.60. Pay grade: E-3; Years of service: 2 or fewer: $21,448.80; Over 6: $24,177.60; Over 12: $24,177.60; Over 18: $24,177.60; Over 24: $24,177.60; Over 30: $24,177.60. Pay grade: E-2; Years of service: 2 or fewer: $20,397.60; Over 6: $20,397.60; Over 12: $20,397.60; Over 18: $20,397.60; Over 24: $20,397.60; Over 30: $20,397.60. Pay grade: E-1; Years of service: 2 or fewer: $18,194.40. Source: Defense Finance and Accounting Service abstract of military basic pay. GAO-14-854R. [End of figure] [End of section] GAO on the Web: Web site: [hyperlink, http://www.gao.gov/] Congressional Relations: Katherine Siggerud, Managing Director, siggerudk@gao.gov: (202) 512-4400, U.S. Government Accountability Office: 441 G Street, NW, Room 7125, Washington, DC 20548: Public Affairs: Chuck Young, Managing Director, youngc1@gao.gov: (202) 512-4800, U.S. Government Accountability Office: 441 G Street, NW, Room 7149, Washington, DC 20548: Copyright: This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately. Briefing slides footnotes: [1] The 2014 Annual Report of the Board of Trustees of the Federal Old- Age and Survivors Insurance and Federal Disability Insurance Trust Funds. Washington, D.C., July 28, 2014. [2] GAO, Income Security: Overlapping Disability and Unemployment Benefits Should Be Evaluated for Potential Savings, [hyperlink, http://www.gao.gov/products/GAO-12-764] (Washington, D.C.: July 31, 2012). [3] Disability ratings are determined based on the severity of disability. [4] VA disability ratings are made in increments of 10 percent, ranging from 0 percent to 100 percent. [5] Special monthly compensation is an additional tax-free benefit paid due to a specific disability such as a loss of use of one hand or leg. [6] A person who is earning more than a certain monthly amount (net of impairment-related work expenses) is ordinarily considered to be engaging in SGA. [7] Public Law 107-107. [8] 42 U.S.C. § 424a(a)(2)(B)(i). Enclosure II: Comments from the Social Security Administration: Social Security: Office of The Commissioner: Social Security Administration Baltimore, MD 21235-0001: September 22, 2014: Mr. Seto Bagdoyan: Acting Director, Forensic Audits and Investigative Service: United States Government Accountability Office: 441 G Street, NW: Washington, DC 20548: Dear Mr. Bagdoyan: Thank you for the opportunity to review the draft report, "Disability Compensation: Review of Concurrent Receipt of Department of Defense Retirement, Department of Veterans Affairs Disability Compensation, and Social Security Disability Insurance" (GAO-14-854R). We do not have any comments. If you have any questions, please contact me at (410) 966-9014. Your staff may contact Gary S. Hatcher, our Senior Advisor for Records Management and Audit Liaison Staff, at (410) 965-0680. Sincerely, Signed by: James A. Kissko: Chief of Staff: [End of section] Enclosure III: Comments from the Department of Veterans Affairs: Department Of Veterans Affairs: Washington DC 20420: September 18, 2014: Mr. Seto J. Bagdoyan: Acting Director: Forensic Audits and Investigative Service: U.S. Government Accountability Office: 441 G Street, NW: Washington, DC 20548: Dear Mr. Bagdoyan: The Department of Veterans Affairs (VA) has reviewed the Government Accountability Office's (GAO) draft report, "Disability Compensation: Review of Concurrent Receipt of Department of Defense Retirement, Department of Veterans Affairs Disability Compensation, and Social Security Disability Insurance" (GAO-14-854R). VA generally agrees with GAO's conclusions. The enclosure provides general and technical comments to the draft report. VA appreciates the opportunity to comment on your draft report. 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