Special Issues in Military Divorce: Survivorship Benefits and Healthcare

H. SURVIVORSHIP AND MILITARY DISABILITY BENEFITS

    There are four categories of military disability pay.  First, military disability retired pay is for a servicemember (SM) disabled after sufficient creditable service.  Second, VA disability it for SMs that have a service-connected illness, condition or disability.  Third, Combat-related special compensation is disability pay where at least 10% of the disability was related to the SM earning a Purple Heart.  Fourth, concurrent retirement and disability pay (CRDP) is not its own form of disability pay, but it applies when the SM has a disability rating greater than 50%. Except in the case of CRDP, all disability pay offsets retirement pay.  In other words, the SM waives a portion of their retirement to receive the disability pay.  The disability pay benefits the SM because it is non-taxable.  Disability pay is also not subject to division under the USFSPA.  As mentioned elsewhere, in a Property Settlement Agreement a SM can agree to indemnify the FS for any disability pay that offsets what he/she would receive in retirement benefits.  The SM can also agree not take any action that would reduce the amount of the retirement benefits.  Virginia courts will usually indemnify a FS if the SM elects disability pay after the fact.  If the SM is already receiving disability pay that cannot be divided counsel should consider alternative avenues which cover that income, such as spousal support.

I. CONTINUED HEALTH CARE

1.     For Spouses

    Military health benefits are offered through TRICARE which is a health insurance and treatment plan for SMs, their dependents and retirees.  TRICARE is an enormous benefit for military families because the military covers most costs, leaving little to no out-of-pocket expense for SMs.  For a FS to receive full military medical benefits for life they must satisfy the 20/20/20 rule.  This means that the SM served for 20 years, the parties were married for 20 years, and there was 20 years of overlap between service and the marriage.  A 20/20/20 FS entitled to TRICARE cannot be enrolled in an employer sponsored plan.  

    For a FS with only 15 years of overlap there is the 20/20/15 rule.  If the couple was divorced before 4/1/1985 the FS would receive full medical care as long as he/she did not remarry.  For those divorced after that date they receive full military medical benefits for one year from entry of the final divorce decree.  

    When a FS is no longer eligible for TRICARE because they did not qualify under the 20/20/20 or 20/20/15 rules they may participate in the military’s transitional health care program.  For the first 60-180 days they would be covered by the Transitional Assistance Management Program.  After that they can qualify for the Continued Health Care Benefit Program (CHBP), a health insurance plan negotiated by the Department of Defense and a private insurer.  A FS can use CHBP for up to thirty-six months after the date of the divorce decree.  In certain circumstances a FS may be able to seek indefinite coverage under the CHBP.

2.    For Children

    As dependents of the SM, children can remain eligible for TRICARE so long as the SM is eligible until they turn 21, turn 23 if studying at an accredited institution, or 26 if they are participating in the TRICARE young adult program.  The SM must enroll a dependent in the Defense Enrollment Eligibility Reporting System for the child to have access to TRICARE.  This process is initiated by the SM filling out DD Form 1172.

    When a dependent is no longer eligible for TRICARE they have access to the same transitional health programs discussed in connection with former spouses.