Facts on Military Medical Separation and Retirement

Factors to determine medical separation or retirement

Image by Nusha Ashjaee Ã‚© The Balance 2019 

When a military member has a medical condition (including mental health conditions) that renders them unfit to perform their required duties, they may be separated (or retired) from the military for medical reasons.

The process to determine medical fitness for continued duty involves two boards. One is called the Medical Evaluation Board (MEB), and the other is called the Physical Evaluation Board (PEB).

Title 10, U.S.C., Chapter 61, provides the Secretaries of the Military Departments with authority to retire or separate members when the Secretary finds that they are unfit to perform their military duties because of physical disability.

DoD Directive 1332.18: SEPARATION OR RETIREMENT FOR PHYSICAL DISABILITY, DoD Instruction 1332.38:  PHYSICAL DISABILITY EVALUATION, and DoD Instruction 1332.39:  APPLICATION OF THE VETERANS ADMINISTRATION SCHEDULE FOR RATING DISABILITIES set forth the policies and procedures implementing the statute.

While most MEB/PEB actions occur when a military member voluntarily presents him/herself at the Medical Treatment Facility (MTF) for medical care, commanders may, at any time, refer military members to the MTF for a mandatory medical examination, when they believe the member is unable to perform his/her military duties due to a medical condition. This examination may cause the conduct of an MEB, which will be forwarded to the PEB when it finds that the member's medical condition falls below medical retention standards.

How the MEB/PEB is Conducted

Physical or mental health problems that are incompatible with military duty or that result in disqualification from worldwide deployment for more than 12 months precipitate a Medical Evaluation Board (MEB). Medical boards are initiated by the Medical Treatment Facility (base medical facility), not the individual or the command.

The medical board consists of active duty physicians (not involved in the care of the military member) who review the clinical case file and decide whether the individual should be returned to duty, or should be separated, using the published medical standards for continued military service.

If the MEB determines that the member has a medical condition that is incompatible with continued military service, they refer the case to a Physical Evaluation Board (PEB). The PEB is a formal fitness-for-duty and disability determination that may recommend one of the following:

  • Return the member to duty (with or without assignment limitations, and or medical re-training)
  • Place the member on the temporary disabled/retired list (TDRL)
  • Separate the member from active duty, or
  • Medically retire the member

The standard used by the PEB for determining fitness is whether the medical condition precludes the member from reasonably performing the duties of his or her office, grade, rank, or rating.

Per DoD Instruction 1332.38, the inability to perform the duties of office, grade, rank or rating in every geographic location and under every conceivable circumstance will not be the sole basis for a finding of unfitness. Deployability, however, may be used as a consideration in determining fitness.

These recommendations are forwarded to a central medical board and can be appealed by the member, who is permitted to have legal counsel at these hearings.


Four factors determine whether disposition is fit for duty, separation, permanent retirement, or temporary retirement: whether the member can perform in their MOS/AFSC/Rating (job); the rating percentage; the stability of the disabling condition; and years of Active Service (active duty days) in the case of pre-existing conditions.

  • Fit for Duty: The member is judged to be fit when he can reasonably perform the duties of his grade and military job. If the member is medically unfit to perform the duties of his/her current job, the PEB can recommend medical re-training into a job he/she will be medically qualified to perform.
  • Disability Rating Percentage: Once a determination of physical unfitness is made, the PEB is required by law to rate the disability using the Department of Veterans Affairs Schedule for Rating Disabilities. DoD Instruction 1332.39 modifies those provisions of the rating schedule inapplicable to the military and clarify rating guidance for specific conditions. Ratings can range from 0 to 100 percent rising in increments of 10.
  • Separation without benefits: Separation without benefits occurs if the unfitting disability existed prior to service, was not permanently aggravated by military service, and the member has less than 8 years of Active Service (active duty days); or the disability was incurred while the member was absent without leave or while engaging in an act of misconduct or willful negligence. If the member has more than 8 years of Active Service, he/she may be medically retired (if eligible) or medically separated with severance pay, even if the condition was pre-existing or hereditary.
  • Separation with severance pay: Separation with disability severance pay occurs if the member is found unfit, has less than 20 years of service and has a disability rating of less than 30%. Disability severance pay equals 2 months basic pay for each year of service not to exceed 12 years (a maximum of 24 months basic pay). The member may also be eligible to apply for monthly disability compensation from the Veterans Administration (VA) if the VA determines the disability is "service-connected."
  • Permanent disability retirement: Permanent disability retirement occurs if the member is found unfit, the disability is determined permanent and stable and rated at a minimum of 30%, or the member has 20 years of military service (For Reserve Component members, this means at least 7200 retirement points).
  • Temporary disability retirement: Temporary disability retirement occurs if the member is found unfit and entitled to permanent disability retirement except that the disability is not stable for rating purposes. "Stable for rating purposes" refers to whether the condition will change within the next five years so as to warrant a different disability rating. However, stability does not include latent impairment--what might happen in the future. When placed on the Temporary Disability Retirement List (TDRL), the law requires the member to undergo a periodic medical reexamination within 18 months at a minimum followed by PEB evaluation. The member may be retained on the TDRL, or a final determination may be made. While the law provides for a maximum tenure of 5 years on the TDRL, there is no entitlement to be retained for the entire period.

Watch Now: 8 Benefits of a Military Career

Retirement Pay Computation 

For permanent retirement or placement on the TDRL, compensation is based on the higher of two computations: Disability rating times retired pay base; or 2.5 x years of service x retired pay base. Soldiers on the TDRL receive no less than 50% of their retired pay base.

The computation of the retired pay base depends on when the member entered the service, and for Reserve members, the law under which they were retired. For those members who entered prior to 8 September 1980, a retired pay base is the highest basic pay received. For those who entered after 7 September 1980, it is the average of the high 36 months of basic pay.

For reserve members retired under 10 USC 1201 or 10 USC 1202 (on the ordered duty of plus 30 days), the last 36 months of active duty days and the associated basic pay is used to determine the average. If the members retired under 10 USC 1204 or 1205, the average is calculated as if the member had been on active duty for the last 36 months.

Military Disability Ratings vs. VA Disability Ratings

While both the Department of Defense and the Department of Veterans Affairs (VA) use the Department of Veterans Affairs Schedule for Rating Disabilities, not all the general policy provisions set forth in the Rating Schedule apply to the military. Consequently, disability ratings may vary between the two.

The military rates only conditions determined to be physically unfitting, compensating for the loss of a military career. The VA may rate any service-connected impairment, thus compensating for the loss of civilian employability. Another difference is the term of the rating.

The military's ratings are permanent upon final disposition. VA ratings may fluctuate with time, depending upon the progress of the condition. Further, the military's disability compensation is affected by years of service and basic pay; while VA compensation is a flat amount based upon the percentage rating received.