Published July 1, 2026. The benefits-news items below were current as of that date; pending bills were pending when written. This is an archived issue of our weekly email — subscribe here to get new issues first.
Chapter 61 and the money nobody explained
Chapter 61 means you were medically retired — retired for a disability rather than for years served. Here's the part that traps people: the program most retirees lean on to recover pay lost to the VA waiver, CRDP, generally requires a 20-year retirement. If you were medically retired short of 20 years, CRDP usually isn't open to you. So VA compensation waives your retired pay dollar-for-dollar, and nothing gives it back.
CRSC is the other door — and it is open to Chapter 61 retirees. It's tax-free, and it restores retired pay tied to conditions that are combat-related (four categories — no Purple Heart or deployment required). For the under-20 medical retiree, CRSC often isn't a swap at all: if the board approves it, it's the first concurrent-receipt money the retiree has ever had a path to.
The honest limit nobody explains up front: for Chapter 61 retirees, CRSC is capped at your "longevity" amount — what you would have earned on years of service alone. The branches compute that as years of creditable service × 2.5% × your high-3 base pay. Your disability-based retired pay may be higher, but CRSC can't exceed that longevity figure.
Translation: the dollar amount depends heavily on how long you served. For a solid career cut short by injury, it can be real monthly money; for a very short one, it can be modest. We don't guess it — a review runs your actual numbers.
CRSC is not automatic: you apply to your branch board and it's decided on the evidence. And it matters right now because the one bill that would fix this for combat-injured under-20 retirees — the Major Richard Star Act — is still stuck in Congress (see below). Until that changes, CRSC is the tool that actually exists today. (New here? Start with CRSC for Chapter 61 medical retirees and What is CRSC?)
What moved this week
That "3.8% raise" wasn't yours
The 2026 military pay raise you saw in the headlines — 3.8% — is active-duty basic pay. Retired pay and VA disability compensation don't move with it; they moved with the 2.8% COLA that took effect December 1, 2025. If your Retiree Account Statement looked lighter than expected, that's why. Pull your RAS on myPay (posted by the 1st each month) and confirm the 2.8% actually landed on both your retired pay and your VA payment. (Source: DFAS 2026 pay tables / DFAS RAS.)
Update on a bill built for Chapter 61 retirees
On June 9, 2026, the Major Richard Star Act — which would let combat-injured Chapter 61 retirees draw retired pay and VA compensation with no offset — was again blocked from a Senate vote over cost-offset objections. The House companion now carries 334 cosponsors and the Secretary of Defense has endorsed it, but it remains pending — not law. More than 50,000 combat-injured medical retirees stay outside full concurrent receipt in the meantime. We'll report if it moves. (Source: Senate Veterans' Affairs Committee / MOAA / Congress.gov. Pending.)
A separate benefits bill cleared the House
The Sharri Briley and Eric Edmundson Veterans Benefits Expansion Act passed the House 235–179 and moved to the Senate. It would add roughly $10,000 a year in Special Monthly Compensation for certain catastrophically injured veterans who need regular in-home aid — the first such increase in over 20 years — and raise Dependency and Indemnity Compensation for surviving families beyond inflation for the first time since 1993. Pending in the Senate — not law yet. (Source: House Committee on Veterans' Affairs / Military.com. Pending.)
Your family's education benefit (Chapter 35 DEA)
If you're rated permanently and totally (P&T) disabled — which describes a lot of Chapter 61 retirees — your spouse and children may qualify for their own benefit: Survivors' and Dependents' Educational Assistance, "Chapter 35." It pays a monthly stipend straight to the student for college, trade school, apprenticeships, and more. The current full-time rate is $1,574/month (three-quarter time $1,243; half time $910) through Sept. 30, 2026, with the next annual bump due in October, and it runs up to 36 months. It doesn't touch your CRSC, your rating, or your retired pay — it's a separate benefit the family applies for with VA Form 22-5490. Texans: it stacks on top of the Hazlewood hours — different programs, both yours. (Source: VA.gov — Chapter 35 rates.)
Pull your retirement orders or DD-214 and find two numbers: your years of creditable service and how you retired (disability/Chapter 61 or length-of-service). If you retired under Chapter 61 with fewer than 20 years and you're not receiving CRSC, the combat-related, tax-free portion of your retired pay — up to your longevity amount — may be sitting unclaimed. Those two numbers start the conversation.
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