Tens of thousands of medically retired veterans lose part of their military retirement pay because of a decades-old federal offset, and a bill reintroduced in Congress in 2026 would end that reduction for the group hit hardest. Under current law, many combat-injured service members who were medically retired before completing 20 years of service cannot collect their full military retirement and their VA disability compensation at the same time; one is subtracted from the other. The proposal, known as the Major Richard Star Act, would remove that penalty for roughly 50,000 of them.
The offset the bill would eliminate
At the center of the issue is a rule barring what is often called concurrent receipt. Military retirement pay is earned through years of service, while VA disability compensation is paid for service-connected injuries, and the two are funded and justified differently. For much of the veteran population, though, federal law has long required that disability compensation be offset dollar for dollar against retirement pay, so a veteran effectively gives up a portion of one benefit to receive the other rather than collecting both amounts fully.
Congress has already carved out exceptions over the years, restoring full concurrent receipt for certain retirees with 20 or more years of service and qualifying disability ratings. The veterans the current bill targets fall outside those carve-outs: combat-injured members who were medically retired before reaching 20 years, a status tracked in the legislative record on concurrent receipt proposals. Because their careers were cut short by injury, they never accrued the length of service that later fixes rewarded, leaving them subject to the offset the newer measure aims to remove.
The financial stake for an affected veteran can be considerable. The offset can reduce monthly income by hundreds or even thousands of dollars, depending on the retirement amount and the disability rating, precisely for people whose injuries ended their military careers early. For a household living on that combined income, eliminating the reduction would raise take-home pay every month for the rest of the veteran’s life, which is why advocates have pressed the change for years. The size of the loss also tends to be largest for the most severely injured, since a higher disability rating means more compensation subtracted from retirement pay under the current formula.
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What the Major Richard Star Act would change
The Major Richard Star Act, reintroduced in the House and Senate in 2026, would let the roughly 50,000 combat-injured medical retirees who were forced out before 20 years of service collect both their full Department of Defense retirement and their full VA disability compensation. It is named for an Army officer and combat veteran who campaigned for the change before his own death. The measure is narrowly written, addressing this specific group rather than repealing the offset for every retiree it currently touches.
Support for the bill has been bipartisan and broad among veterans’ organizations. The Military Officers Association of America has been among the most visible backers, lobbying to move the measure through committee and onto the floor in successive sessions of Congress. Despite that backing and long lists of cosponsors in past sessions, the act has not become law, stalled in earlier years largely over its projected cost, which grows as it would add benefit dollars for a sizable population of veterans.
That cost is the recurring obstacle. Ending the offset for tens of thousands of retirees means paying benefits that current law withholds, and the multiyear price tag has repeatedly complicated efforts to attach the measure to larger defense or spending packages. Supporters counter that the offset unfairly penalizes the very veterans whose injuries were most severe, framing the expense as a matter of fairness owed to the combat-wounded rather than a discretionary add-on.
Where the proposal stands for affected veterans
For now, nothing has changed in what these veterans receive. Until a bill actually passes both chambers and is signed, the dollar-for-dollar offset remains in force, and affected retirees continue to see their retirement pay reduced by their VA compensation. Veterans can review their own VA disability compensation and retirement statements to see how the current offset applies, but the fuller payment the bill envisions depends entirely on enactment that has not yet occurred.
The timing carries a human dimension as well. Many of the veterans in this group are aging, and some, like the officer the bill honors, have died while the measure waited, meaning delay is not cost-free even as lawmakers weigh the budget math. Each session that passes without action is another year the affected retirees absorb the reduction, a point advocates raise when the proposal competes for space against other priorities.
The story is a familiar one in veterans’ policy: a widely supported fix, a sympathetic population, and a price tag that keeps it from the finish line. Reintroduction in 2026 restarts the legislative clock rather than guaranteeing an outcome, and the roughly 50,000 combat-injured retirees it would help remain subject to the offset unless and until Congress acts. Whether this session finally moves the measure, or it stalls again over cost as it has before, will determine if those veterans see their full benefits or continue trading one check against the other.
This article was produced with AI assistance and reviewed against primary sources by The Money Overview editorial team.
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