Congressional leaders and the Bush administration, scorched by criticism from veterans’ groups over a House Republican proposal to end annuity offsets for current disabled retirees by cutting benefits for future veterans, are weighing a simple alternative, to expand eligibility for CRSC.

CRSC is Combat-Related Special Compensation, fashioned by Congress last year as a “beachhead” toward ending the ban on “concurrent receipt” of both military retired and disability compensation from the Department of Veterans Affairs.

CRSC is intended to ease, for the most deserving retirees, the dollar-for-dollar offset in retired pay that occurs when they elect to draw tax-free VA compensation for service-connected disabilities.

With only about 35,000, or 5 percent, of 700,000 retirees drawing disability compensation expected to be eligible for CRSC, military associations and veterans groups continued to press Congress to do more, and ideally, in their view, to lift the ban on concurrent receipt entirely.

Critics, including Defense Secretary Donald Rumsfeld, say full concurrent receipt is too expensive — almost $60 billion over 10 years.

Balancing those concerns led House Republican leaders to propose a five-year phase-in of full concurrent receipt if veterans groups would allow Congress to tighten disability rules for future veterans by limiting eligibility to illnesses or injuries that occur only in “performance of duty.”

Administration officials are said to be discussing a three-part proposal that would allow some progress on the issue this year and rehabilitate leading Republicans in the eyes of veterans.

Part one, almost certain to be approved, would extend CRSC eligibility to all reserve retirees who have qualifying disabilities. Dropped would be a requirement that disabled reservists have 7,200 drill points, the equivalent of 20 years on active duty.

A second part would lower the CRSC eligibility threshold for combat-related disabilities from 60 percent to perhaps 30 percent, still a “serious” disability rating. An additional 80,000 to 100,000 retirees could be eligible for CRSC.

A third initiative would be a congressionally-directed study of both VA and DOD disability programs, focusing on their interaction, including the concurrent receipt law, with an eye toward modernization and reform.

Anthony Principi, secretary of Veterans Affairs, hinted at these initiatives, said to be under study by the administration, during a Sept. 23 hearing of the Senate Veterans Affairs Committee.

Sen. Arlen Specter, R-Pa., called the hearing on two days’ notice to allow veterans groups to vent on the House proposal and perhaps to distance his own committee from the same.

Mark Olanoff of the American Legion testified that if the House proposal were in effect in 1996 when terrorists bombed Khobar Towers in Saudi Arabia, “heroes” injured in their quarters — 19 others were killed — would not be eligible for VA disability pay because they were off duty.

Scores of Marines who have shown malaria-like symptoms during the ongoing deployment to Liberia, said Dennis Cullinan of the Veterans of Foreign War, might have to show they were bitten by mosquitoes “while on duty” rather than while “in their bunks.”

“You have made an overwhelming case today,” Specter told the veterans’ group representatives, “and I am with you.”

After the hearing, Specter said the proposal that offended so many veterans was floated for House conferees working on the defense bill. “It’s definitely not a White House proposal,” he insisted.

“We’re back to space one,” said a source working on concurrent receipt within the conference. “The effort now is to determine what if anything can be done to enhance Combat-Related Special Compensation.”

— Comments welcomed. Write to Military Update, P.O. Box 231111, Centreville, VA 20120-1111, e-mail or visit Web site at:

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