United States Government Accountability Office

GAO Report to Congressional Committees

DISABILITY 

BENEFITS 

Benefit Amounts for 

Military Personnel and 

Civilian Public Safety 

Officers Vary by 

Program Provisions 

and Individual 

Circumstances 

April 2006 

 

GAO-06-4
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

April 2006

DISABILITY BENEFITS

Benefit Amounts for Military Personnel 

and Civilian Public Safety Officers Vary 

by Program Provisions and Individual 

Circumstances 

Highlights of GAO-06-4, a report to

congressional committees 

Military personnel, as well as

civilian public safety officers 

(PSO), risk their lives and face the

prospect of incurring disabilities as

they protect and defend the general 

public on a daily basis. To help 

assess the appropriateness of 

disability benefits available to 

military personnel, Congress 

mandated that GAO study the

disability benefits available to 

federal, state, and local government

employees who serve the public in 

high-risk occupations and are 

injured in the line of duty. 

 

In response, GAO compared the 

disability benefits available to 

military personnel with the

disability benefits available to 

civilian PSOs at the federal level, 

and in six states and six cities that 

were selected to illustrate the

range of benefits provided. This 

study focuses on benefits provided

to law enforcement officers and 

firefighters at the federal level, to

state police at the state level, and 

to firefighters at the local level. For 

each program included in the 

review, GAO identified the benefits 

available for temporary disability, 

permanent partial disability, and 

permanent total disability, and then 

calculated the lifetime present 

value of the benefits provided to

various hypothetical individuals in

different circumstances. 

Cognizant agency officials provided

only technical suggestions, which

were incorporated as appropriate. 

Neither military personnel, nor any of the civilian PSOs included in this 

study, consistently have more line-of-duty disability benefits available to 

them in all situations. This report highlights the variation in the type and 

amount of benefits provided across programs, depending on specific 

program provisions and individual circumstances. For example, during the 

initial period of treatment, recovery, and evaluation, program provisions 

governing the availability of continuation of pay and temporary disability 

benefits offer certain advantages for military servicemembers compared 

with the selected civilian PSOs. When disabilities are permanent, however, 

the amount of benefits provided over a lifetime for permanent partial or 

totally incapacitating disabilities are sometimes greater for military veterans,

and sometimes greater for the selected civilian PSOs, depending on such 

variables as the type and degree of impairment and the individual’s preinjury salary level. The figure below illustrates how these and other variables 

would affect lifetime compensation and disability retirement benefits for 

military personnel, federal PSOs, and selected state PSOs in two scenarios—

a permanent partial disability (leg amputation) and a permanent total 

disability (quadriplegia)—for a hypothetical individual age 35, with 12 years 

of service and an annual salary of $60,000. 

Comparison of Lifetime Benefits for One Hypothetical Individual in Two Different Scenarios 

Dollars

Source: GAO analysis of benefits received over a lifetime for a hypothetical individual age 35, with 12 years of service and an annual

salary of $60,000. 

Leg amputation Quadriplegia

0

400,000

800,000

1,200,000

1,600,000

Texas

New Jersey

Montana

Florida

Indiana

California

Federal PSO

Military personnel

Texas

New Jersey

Montana

Florida

Indiana

California

Federal PSO

Military personnel

GAO is not taking a position on how disability benefits should be modified. 

However, GAO believes that any deliberations on this topic should include 

an examination of how such changes would affect ensuring adequate and 

appropriate benefits for those who serve their country, as well as the longterm fiscal well-being of the nation. 

www.gao.gov/cgi-bin/getrpt?GAO-06-4.

To view the full product, including the scope 

and methods, click on the link above. 

For more information, contact Cristina 

Chaplain at (202) 512-7215 or 

chaplainc@gao.gov. 
Contents 

Letter 1

Results in Brief 4

Background 5

Temporary Disability Program Provisions Offer Certain Advantages 

for Military Personnel Compared with Civilian PSOs 10 

Permanent Partial Disability Benefits Are Greater over a Lifetime 

for Military Personnel or Civilian PSOs, Depending on Individual 

Circumstances 21

Permanent Total Disability Benefits Are Greater over a Lifetime for 

Military Veterans or for Civilian PSOs, Depending on the Type of 

Impairment 36

Concluding Observations 47 

Agency Comments 48 

Appendix I Disability Compensation Benefit Programs 50 

Appendix II Disability Retirement Benefits Programs 64 

Appendix III Other Disability Benefit Programs 82 

Appendix IV Hypothetical Scenarios and Calculation of Lifetime 

Disability Benefits—Methods and Results 85 

Appendix V Impact of Varying Salary Levels on Monthly Benefit 

Payments 115 

Appendix VI Federal Income Tax Treatment of Disability 

Benefits 119 

Page i GAO-06-4 Disability Benefits
Appendix VII Progression of Disability Benefits Following a 

Line-of-Duty Injury, by Occupation 122 

Appendix VIII Definitions of Total Disability 125 

Appendix IX GAO Contacts and Staff Acknowledgments 128 

Related GAO Products 129 

Tables 

Table 1: Continuation of Pay Provisions 13 

Table 2: Basic Monthly Compensation Rates for VA Disability in 

2005 14 

Table 3: Temporary Compensation Payment Formulas and 2005

Payment Caps for Selected Civilian PSOs 15 

Table 4: Time Limits on Temporary Disability Benefits 21 

Table 5: Time Limits on Compensation for Permanent Partial 

Disabilities 24

Table 6: Disability Retirement Benefit Formulas for Military 

Personnel and Selected PSOs 26 

Table 7: Concurrent Receipt Provisions for Permanent Partial 

Disabilities 28

Table 8: Post-Retirement Employment and Earnings Restrictions 

on Receipt of Disability Retirement Benefits 35 

Table 9: Basic Total and SMC Rates for VA Disability in 2005 37 

Table 10: Benefits Provided for Tinnitus 89 

Table 11: Benefits Provided for a Leg Amputation 92 

Table 12: Benefits Provided for Quadriplegia and Other Permanent 

Total Disabilities 104 

Table 13: Base Annual Starting Salaries by Occupation and 

Experience Level, 2000 115 

Table 14: Monthly Temporary Compensation Payments Based on 

Actual versus Hypothetical Salary Levels 116 

Table 15: Monthly Disability Retirement Payments Based on Actual 

versus Hypothetical Salary Levels 117 

Page ii GAO-06-4 Disability Benefits
Figures 

Figure 1: Progression of Disability Benefits Following a Line-ofDuty Injury 6 

Figure 2: Military and Civilian Temporary Monthly Compensation 

Benefits in Two Contrasting Scenarios (2005 Payment 

Rates) 16

Figure 3: Military and Civilian Temporary Monthly Benefits for 40 

Percent Disability Ratings, including Temporary Disability 

Retirement Benefits for Servicemembers (2005 Payment 

Rates) 19

Figure 4: Comparison of Present Value of Compensation Benefits 

over a Lifetime for Tinnitus 31 

Figure 5: Comparison of Present Value of Combined Disability 

Benefits over a Lifetime for a Leg Amputation 34 

Figure 6: Comparison of Present Values of Combined Disability 

Benefits over a Lifetime for Quadriplegia and Other 

Permanent Total Disabilities 45 

Abbreviations 

AMA American Medical Association 

COLA cost-of-living adjustment 

DOD Department of Defense 

DROP Deferred Retirement Option Plan 

FECA Federal Employees’ Compensation Act 

FERS Federal Employees’ Retirement System 

GS General Schedule 

OWCP Office of Workers’ Compensation Programs 

PSO public safety officer 

SMC special monthly compensation 

SSDI Social Security Disability Insurance 

VA Department of Veterans Affairs 

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Page iii GAO-06-4 Disability Benefits
United States Government Accountability Office

Washington, DC 20548 

 

April 7, 2006

Congressional Committees 

Since the September 11, 2001, terrorist attacks, the United States has 

increased the deployment of military forces in armed conflict and the use 

of both military and civilian personnel in national preparedness and 

fighting terrorism. As with military personnel on active duty status, civilian 

public safety officers (PSO), including law enforcement officers and 

firefighters, also risk their lives and face the prospect of incurring 

disabilities as they protect and defend the general public on a daily basis.1

GAO’s designation of federal disability programs as a high-risk area 

requiring urgent attention and modernization, combined with the 

heightened risk of disability for both military personnel and civilian PSOs, 

underscores the importance of ensuring that those who serve our nation 

and who sustain injuries in the line of duty have fair and appropriate 

benefits available to them.2

 At the same time, any discussion of 

modernizing federal disability programs or changing the benefit structure 

for military servicemembers or federal civilian PSOs will take place within 

the context of the large fiscal imbalances facing the federal government.3

As part of an ongoing, multi-faceted effort to assess the appropriateness of 

disability benefits available to military personnel, the National Defense 

Authorization Act for Fiscal Year 2005 mandated that GAO identify the 

disability benefits available to federal, state, and local government 

employees who serve the public in high-risk occupations and are injured in 

 1

Provisions in 42 U.S.C. §3796b(8) define “public safety officers” for Department of

Justice’s Public Safety Officers’ Benefits Program to include law enforcement officers 

(such as police, corrections, probation, parole, and judicial officers), firefighters, and 

members of rescue squads and ambulance crews, among others. 

2

Military personnel in combat are now surviving injuries that would have been fatal in past 

conflicts, but along with this survival has come an increased rate of disabilities. See GAO,

VA Disability Benefits and Health Care: Providing Certain Services to the Serious 

Injured Poses Problems, GAO-05-444T (Washington, D.C.: Mar. 17, 2005). 

3

In 2003, GAO designated federal disability programs as a high-risk area. See GAO, High

Risk Series: An Update, GAO-05-207 (Washington, D.C.: Jan. 1, 2005), and GAO, 21st 

Century Challenges: Reexamining the Base of the Federal Government, GAO-05-325SP

(Washington, D.C.: Feb. 1, 2005). 

Page 1 GAO-06-4 Disability Benefits
the line of duty.4

 In response, this report compares the service-connected 

disability benefits provided military personnel with the benefits provided 

for line-of-duty injuries to civilian PSOs at the federal, state, and local 

level, focusing on the benefits provided for three main categories of 

disability: (1) temporary disability, (2) permanent partial disability, and 

(3) permanent total disability. 

To compare the disability benefits available, we examined the major 

programs providing compensation and disability retirement benefits for 

military personnel, for civilian PSOs at the federal level, and for civilian 

PSOs at the state and local level in six states and six cities. Active-duty 

military servicemembers generally have access to disability benefits under 

program provisions that apply to all the various services, and federal PSOs

(including federal law enforcement officers and firefighters) generally 

have access to disability benefits for this group of employees under 

program provisions that apply to all the various federal agencies. 

However, disability benefit program provisions vary widely for state and 

local PSOs depending on the specific occupation and location. At the state 

level, we focused on benefits available to state police officers (such as 

highway patrol or state troopers) in a nonprobability sample of six states. 

To illustrate the range of benefits available, we selected these states based 

on various indicators of benefit levels5

 and geographic diversity. At the 

local level, we focused on benefits available to firefighters in six large 

cities, one within each of the selected states. The six states and six cities 

we selected are: California and Los Angeles; Florida and Miami; Indiana 

and Indianapolis; Montana and Billings; New Jersey and Newark; and 

Texas and Houston. The programs selected provide examples of a wide 

range of policies and practices for determining disability benefits; 

however, they may not be representative of the full extent of the variation

nationwide.

 4

Pub. L. No. 108-375 (2004). This law also mandated that DOD conduct a study comparing

the disability benefits for servicemembers with the disability benefit plans for commercial 

and other private-sector employees. In addition, under the National Defense Authorization 

Act for Fiscal Year 2004, Congress established the Veterans’ Disability Benefits 

Commission to study the appropriateness of benefits for servicemembers for serviceconnected disability and death. 

5

These indicators included, for example, the state median monthly Social Security 

Disability Insurance (SSDI) benefit, salary levels for state PSOs, and the amount of cash

survivor benefits available to PSOs. 

Page 2 GAO-06-4 Disability Benefits
We documented and compared program provisions for compensation and 

disability retirement benefits for military personnel, federal PSOs, and the 

selected state and local PSOs, relying primarily on statutes, regulations, 

and agency guidance and reports. (For descriptions of disability 

compensation benefit programs, see app. I. For descriptions of disability 

retirement benefit programs, see app. II. For descriptions of other 

disability benefit programs, see app. III.) To gain an initial understanding 

of how disability programs work, we conducted site visits with federal 

program officials at the Department of Defense (DOD), Department of 

Veterans Affairs (VA), Department of Labor, and Office of Personnel 

Management in Washington, D.C.; and with state and local program 

officials in California and New Jersey. We interviewed officials at all other

agencies and locations by phone. 

To demonstrate the effect of different types of injuries and other 

individual characteristics on the provision of benefits under each program, 

we constructed hypothetical scenarios for military personnel and the 

selected civilian PSOs at different ages, lengths of service, and salary 

levels. (For more detailed descriptions of these hypothetical scenarios, see 

app. IV.) We requested cognizant agency staff to review our 

characterization of program provisions and calculation of hypothetical 

benefit amounts to ensure the validity of our information. To compare 

different types of benefits, such as lump-sum and monthly payments, we 

calculated the present value of the lifetime disability benefits available, 

including disability compensation and disability retirement benefits, for 

each of our hypothetical scenarios. (See app. IV for a more detailed 

discussion of our methods for calculating present values.) 

Our analysis focused on cash disability benefits that include government 

contributions rather than on other benefits and services such as medical 

care and vocational rehabilitation services, or benefits that are solely 

employee- or privately-funded. We did not include benefits from programs 

in which employees may or may not choose to participate and that provide 

variable benefits depending on how much an employee chooses to 

contribute (such as life insurance plans, savings plans, and alternative 

retirement options).6

 In addition, our analysis focused on the differences in

how benefits are calculated given equal salaries, rather than on the 

differences in salary levels across locations for comparable jobs and years 

 6

As a result, our analysis excludes, for example, the potential benefits received from the

Traumatic Servicemembers Group Life Insurance Program, enacted in May 2005. 

Page 3 GAO-06-4 Disability Benefits
of service or on the differences in administrative processes for obtaining 

benefits. (For a more detailed discussion of the difference in benefit 

calculations based on the hypothetical salary levels compared with actual 

salary levels, see app. V.) We conducted our research from March 2005 to 

November 2005 in accordance with generally accepted government 

auditing standards. 

During the initial period of treatment, recovery, and evaluation, program 

provisions for temporary disability benefits offer certain advantages for 

military personnel compared with provisions for the civilian PSOs we 

reviewed. For example, whenever an active-duty servicemember incurs an 

injury or becomes ill and is found unfit for duty, the injury or illness 

almost always qualifies as line-of-duty, enabling the servicemember to 

receive compensation benefits. The injury can occur at any time, 24 hours 

a day, 7 days a week. The coverage for civilian PSOs we reviewed is not 

considered around-the-clock in this way. To be considered a line-of-duty 

injury eligible for compensation, usually the injury must occur during 

working hours when the PSO is performing assigned duties. In addition, 

the military generally has more flexibility in its provision of 100 percent 

salary replacement (referred to as continuation of pay) than do most of the 

civilian programs we reviewed, because unlike the provisions for PSOs, 

the time limit on this benefit for servicemembers is not fixed in law. In 

addition, servicemembers can have temporary access to disability 

retirement benefits as well as VA compensation benefits for up to 5 years 

in some cases. In contrast, on the civilian side, federal PSOs and the 

selected state and local PSOs we reviewed generally have access only to 

temporary compensation payments, not disability retirement, during this 

phase of benefit receipt.

Results in Brief 

When a partial disability incurred in the line of duty is determined to be 

permanent, the timing and amount of benefits provided over a lifetime 

varies, depending on the individual’s circumstances. In most cases of 

permanent partial disability, servicemembers and civilian PSOs are eligible

to receive compensation benefits, and in some cases, they also may be 

eligible to receive disability retirement benefits, but the criteria for benefit 

receipt and amount of benefits provided vary across programs. In some 

circumstances, when a permanent partial disability still allows a return to 

duty, the civilian PSOs we reviewed generally can receive compensation 

benefits immediately in addition to their salaries, whereas military 

personnel cannot receive compensation benefits until they are released 

from service through separation or retirement. Nevertheless, because the 

compensation benefits for permanent partial disabilities for the selected 

Page 4 GAO-06-4 Disability Benefits
PSOs are generally time-limited, whereas compensation benefits for 

military veterans are for the remainder of life, the present value of the 

compensation benefits available over a lifetime for veterans can be 

substantially greater than the present value of benefits available for the 

PSOs. In other circumstances, when a permanent partial disability 

prevents a return to duty, disability retirement benefits are often provided 

in addition to compensation benefits. We found that the present value of 

the combined compensation and disability retirement benefits available 

over a lifetime for veterans is sometimes higher and sometimes lower than 

the combined benefits available for the civilian PSOs we reviewed, 

depending on the specific provisions for calculating benefits and for the 

concurrent receipt of both types of benefits. In addition, if the individual is 

able to work at another job, the military and several disability retirement 

programs we reviewed require post-injury employment to be under a 

different retirement system, but most programs do not place any limits on 

the amount of post-retirement earnings. 

When the disability incurred in the line of duty is severe enough to be 

determined to be permanent and total, the amount of benefits provided 

over a lifetime is greater for military veterans in some cases, and for 

civilian PSOs in others, depending on the specific program provisions and 

the type of impairment. In cases of permanent total disability, military 

veterans and civilian PSOs have access to a range of benefits that are 

enhanced compared with those available for permanent partial disability. 

These may include enhanced compensation and disability retirement 

benefits, a special lump-sum benefit available only to civilian PSOs, or 

additional benefits such as Social Security Disability Insurance (SSDI). 

Benefits received over a lifetime for permanent total disability are greater

for military veterans than for the selected civilian PSOs in some situations 

and not in others, depending on such factors as the program’s provisions 

for concurrent receipt of compensation and disability retirement benefits,

and whether the veteran’s type of injury qualifies for special 

compensation. 

Cognizant agencies reviewed a draft of this report and provided only 

technical suggestions which were incorporated as appropriate. 

Government-provided disability benefits for military personnel and civilian 

PSOs generally fall into two broad categories: disability compensation 

benefits and disability retirement benefits. (See fig. 1.) 

Background 

Page 5 GAO-06-4 Disability Benefits
• Disability compensation. Under workers’ compensation and 

veterans’ compensation programs, benefits typically include medical 

treatment for the injury, vocational rehabilitation services, and a cash 

payment to replace a percentage of the individual’s loss in wages while 

injured and unable to work. Disability compensation benefits are 

exempt from federal income tax. 

• Disability retirement. Disability retirement programs typically 

provide benefits that allow qualified individuals who are unable to 

return to work to retire earlier and/or to retire with a higher percentage

of their pre-injury salary level than would otherwise be permitted with 

normal retirement based on age and length of service at the time of 

injury. Disability retirement benefits generally are not exempt from 

federal income tax, but there are exceptions. (For details, see app. VI.) 

Figure 1: Progression of Disability Benefits Following a Line-of-Duty Injury 

Line-ofduty injury 

occurs

Period of treatment, 

recovery, and 

evaluation:

Continuation of pay, 

and/or recurring 

compensation 

payments to replace 

salary loss.

Medical treatment of 

injury.

Permanent partial disability, able to return to duty:

May receive reduced/time-limited compensation payments

in some cases.

Medical treatment of injury and vocational rehabilitation 

services generally provided.

Condition stabilizes

or time limit 

reached

·

·

Permanent partial disability, unable to return to duty:

·

·

·

Permanent total disability, unable to be gainfully employed:

·

·

·

·

·

Source: GAO analysis.

Temporary disability benefits Permanent disability benefits

No continuing permanent disability, able to return to duty:

All benefits cease.

Disability retirement for most.

Also may receive some compensation payments in some 

cases, but the amount of combined benefits (retirement plus

compensation) is often limited.

Medical treatment of injury and vocational rehabilitation 

services generally provided.

Disability retirement for most.

Also may receive compensation payments, but the amount of 

combined benefits (retirement plus compensation) is often 

limited.

Medical treatment of injury. 

Various other additional benefits available.

·

·

Note: For a more comprehensive summary of disability benefits available, by occupation, see app.

VII. 

Page 6 GAO-06-4 Disability Benefits
When an individual is eligible to receive both disability compensation and 

disability retirement benefits, programs sometimes place limits on the 

combined amount of benefits received. Some programs do not allow both 

types of benefits to be received concurrently, instead requiring the 

individual to choose which one to receive. Other programs may allow both 

types of benefits to be received, but they reduce (offset) either all or a 

portion of one of the benefits.7

For military personnel who incur a service-related disability, VA provides 

service-connected disability compensation benefits and DOD provides 

disability severance or retirement benefits, depending on level of disability 

and length of service. Military personnel found unfit for duty are evaluated

and assigned disability ratings ranging from 0 to 100 percent, in 

10 percentage-point increments. Those who have a disability rated at 

20 percent or less and who have served at least 6 months, but less than 

20 years, may be entitled to a lump-sum disability payment (disability 

severance). Those who have a disability rated 30 percent or more, or who 

have served 20 years or more, may be entitled to disability retirement. 

Once released from service through separation or retirement, military 

veterans can receive monthly VA compensation payments based on their 

disability rating, with added amounts for particularly severe injuries 

(referred to as special monthly compensation). In fiscal year 2004, VA 

provided about $20.6 billion in cash disability compensation benefits to 

more than 2.5 million veterans and their dependents, and DOD spent 

$1.25 billion on disability retirement benefits for approximately 

93,000 recipients. 

When military personnel are eligible for both VA compensation and DOD 

disability retirement benefits, in most cases, the retirement benefit is 

offset dollar-for-dollar by the amount of the compensation benefit.8

Exceptions to this offset are provided for those who are eligible for 

normal retirement based on 20 years or more of service and who have

either a disability rating of 50 percent or more, or combat-related 

 7

Previously, we reported that while the specific rationales for offset provisions vary, they

generally focus on restoring equity and fairness by treating beneficiaries of more than one

program in a similar manner as beneficiaries who qualify for benefits under only one of the

programs. See GAO, Military and Veterans’ Benefits: Observations on the Concurrent 

Receipt of Military Retirement and VA Disability Compensation, GAO-03-575T 

(Washington, D.C.: Mar. 27, 2003). 

8

When eligible for both VA compensation and DOD disability severance benefits (as 

opposed to retirement benefits), the compensation benefit is offset.

Page 7 GAO-06-4 Disability Benefits
disabilities.9 Military personnel with 20 years or more of service and with a 

disability rating of 50 percent or more can qualify for Concurrent 

Retirement and Disability Payments. Under this program, the offset is 

being phased out over a 10-year period that began on January 1, 2004; thus, 

by January 1, 2014, veterans who qualify will be able to receive the full 

amount of their VA compensation and DOD disability retirement benefits

concurrently with no offset. Alternatively, military personnel with 20 years 

or more of service and with combat-related disabilities can qualify for 

Combat-Related Special Compensation. Under this program, which 

became effective in May 2003, a special tax-exempt benefit is provided 

equal to the amount of the offset.10

On the civilian side, federal PSOs receive workers’ compensation benefits

under the Federal Employees’ Compensation Act (FECA), and those with 

at least 18 months of service may be eligible for disability retirement 

benefits under the Federal Employees’ Retirement System (FERS).11

Benefits are generally the same as for all other civilian employees of the 

federal government, except that federal law enforcement officers and 

firefighters belong to a special group of employees who can take normal 

retirement at an earlier age and have their retirement benefits calculated 

differently.12

At the state and local level, all 50 states and the District of Columbia have 

workers’ compensation statutes that cover virtually all industrial 

employees, and in many states this coverage is extended to public 

employees such as PSOs. Moreover, nearly all employees in state and local 

governments participate in employment-based retirement plans that 

generally include provisions for disability retirement. Among the PSOs 

 9

Combat-related disabilities are defined as disabilities incurred as a direct result of armed 

conflict, while engaged in hazardous service, while performing duty simulating war, or

through an instrumentality of war. 

10According to DOD records, about 1,170 (about 1.3 percent) of those receiving disability 

retirement were receiving special compensation for combat-related disabilities at the end 

of fiscal year 2004, following the first year of the program’s implementation. 

11FERS generally covers all federal employees hired after January 1, 1984. Those hired 

before 1984 still may be covered by the Civil Service Retirement System; however, that 

system has been closed to new members since FERS was implemented in 1984. 

12Federal law enforcement officers and firefighters can take normal retirement at age 

50. The minimum retirement age for other federal employees is between the ages of 55 and 

57, depending on the employee’s year of birth. For details on benefit calculations, see app.

II, federal PSOs. 

Page 8 GAO-06-4 Disability Benefits
included in our study, we found that disability compensation benefits were 

provided under the states’ workers’ compensation programs in all but one 

state: Indiana.13 We also found that the provisions that govern workers’ 

compensation benefits for PSOs at the state level are, in general, the same

as those at the local level. In addition, among the state and local 

governments we reviewed, all provide some type of disability retirement 

benefits to qualified PSOs injured in the line of duty if the injury prevents a 

return to work. 

At all levels of government, compensation and disability retirement 

programs often provide added benefits in cases of permanent total 

disability. Among the programs included in our study, most define 

permanent total disability as a disability that prevents an individual from 

engaging in any substantial gainful activity.14 VA defines total disability as a 

disability rated at 100 percent;15 however, a total disability rating may also 

be assigned when a veteran is unable to secure or follow a substantially 

gainful occupation as a result of service-connected disabilities.16 Of the 

veterans being compensated at the 100 percent disability level in 2004, just

under half qualified on the basis of individual unemployability. 

In addition, other agencies and organizations may provide other cash 

benefits in cases of permanent total disability. For example, military 

personnel and civilian PSOs who participate in the Social Security system 

may be eligible to receive SSDI benefits. Also, the Department of Justice 

administers a Public Safety Officers’ Benefits Program that provides a 

lump-sum benefit to civilian PSOs at the federal, state, and local level 

 13In Indiana, state statutes allow some public employers to opt out of the state’s workers’ 

compensation program, and we found that both the Indiana State Police and the 

Indianapolis Fire Department had opted to provide disability benefits only from their 

pension funds.

14See app. VIII for the various definitions of permanent total disability used across 

programs. 

15California’s workers’ compensation program also defines total disability as a disability 

rated at 100 percent, but adjusts its disability ratings to account for diminished future 

earning capacity. California’s rating guide states that permanent total disability is a level of 

disability at which an employee has sustained a total loss of earning capacity. 

16In addition, current law specifies that benefit levels are to be based on disability ratings 

that reflect the average loss of earning capacity for the particular injury. However, we have

noted in prior reports that the labor market information used in determining these benefits

has not been updated since 1945. See GAO, VA Benefits: Fundamental Changes to VA’s

Disability Criteria Need Careful Consideration, GAO-03-1172T (Washington, D.C.: Sept.

23, 2003). 

Page 9 GAO-06-4 Disability Benefits
when totally incapacitated in the line of duty. In fiscal year 2005, this lumpsum benefit was set at $275,658. 

During the initial period of treatment, recovery, and evaluation following a 

line-of-duty injury, temporary disability benefit provisions for military 

personnel offer certain advantages compared with provisions for the 

civilian PSOs we reviewed. When a military servicemember or civilian PSO 

is injured, the first and most immediate concern is to ensure that 

appropriate medical treatment is provided. If the servicemember or PSO is 

unable to return to duty, however, another concern soon follows: ensuring 

that lost wages are replaced during the period of treatment, recovery, and

evaluation. All programs reviewed provide benefits to replace a portion of

lost wages for individuals injured in the line of duty up until the time the 

injury is determined to be permanent and/or the individual can return to 

duty. However, compared with program provisions following a line-of-duty 

injury to a civilian PSO, injuries to servicemembers are more likely to 

qualify as line-of-duty injuries; continuation of pay provisions for 

servicemembers are generally more flexible; and, unlike civilian PSOs, 

servicemembers can have access to temporary disability retirement 

benefits in some cases. 

Temporary Disability 

Program Provisions 

Offer Certain 

Advantages for 

Military Personnel 

Compared with 

Civilian PSOs 

Injuries to Military 

Personnel Are More Likely

to Qualify as Line-of-Duty 

Injuries 

In the military, whenever an active-duty servicemember incurs an injury or 

becomes ill and is found unfit for duty, it is almost always considered a 

line-of-duty injury that would enable the servicemember to receive serviceconnected disability benefits. The injury or illness can occur at any time, 

24 hour a day, 7 days a week, and does not have to occur while the 

servicemember is engaged in a duty-related activity. A pre-existing injury 

or illness also can be covered if it becomes aggravated during service.17

Even a non-line-of-duty injury that is similar to the line-of-duty injury may 

be included in the determination of the disability level in some cases.18 For 

the most part, the only exceptions to coverage are when the injury or 

disease is a result of the servicemember’s own willful misconduct or abuse 

 17VA provides disability compensation for pre-existing injuries aggravated during service 

with no length of service requirement. Also, DOD can provide disability retirement benefits

for a pre-existing condition, but only after the servicemember has completed 8 years or 

more of active service. 

18For example, if a servicemember sustains deafness in one ear as a result of serviceconnected disability and deafness in the other ear from a non-line of duty injury, VA may 

combine both injuries to obtain a total level of compensable disability.

Page 10 GAO-06-4 Disability Benefits
of alcohol or drugs,19 or if the servicemember received a dishonorable 

discharge from the military for the period of service giving rise to the 

injury. Moreover, federal statutes and related regulations governing VA 

compensation benefits specify that many chronic diseases and other 

conditions are presumed to be caused by military service once the 

servicemember has served for 90 days. These presumptive conditions 

include, for example, arteriosclerosis, diabetes mellitus, epilepsy, 

leukemia, multiple sclerosis, and tuberculosis, among others.20

Federal PSOs’ coverage for injuries and illness is not considered line-ofduty around-the-clock as in the military. Usually the injury or illness must 

occur during working hours when the PSO is performing assigned duties 

or engaging in an activity that is reasonably associated with employment. 

In addition, there are no presumptive conditions specified. All claims must 

establish a link between the injury or illness and employment. But similar 

to the provisions for servicemembers, federal PSOs are provided line-ofduty disability benefits for any pre-existing injury or disease that is 

aggravated, accelerated, or precipitated by employment, and similar 

exceptions to coverage apply if the injury is caused by willful misconduct, 

intoxication, or the employee’s intention to harm himself or others. 

The selected state and local PSOs have similar coverage—and exceptions 

to coverage—as described above for federal PSOs. Provisions governing 

line-of-duty disability benefits for PSOs typically specify that any injury or

disease arising out of employment is covered. Unlike at the federal level, 

however, some states have established some illnesses as presumptive 

conditions for PSOs. We found this to be the case in California, Florida, 

and New Jersey.21

 19However, military officials noted that the effects of drug abuse can be compensable if the

servicemember develops human immunodeficiency virus (HIV) or acquired 

immunodeficiency syndrome (AIDS) from such use. 

20If exposed to radiation, presumptive conditions can include certain cancers. Additional 

presumptions also are provided, depending on the years and location of service. 

21See app. I for more detailed descriptions of these states’ provisions. 

Page 11 GAO-06-4 Disability Benefits
Following a line-of-duty injury, the military’s provisions for allowing 

servicemembers to continue to receive their full pre-injury salary, whether 

or not they are able to return to duty, are generally more flexible than the 

policies for the civilian PSOs we reviewed. In the military, and across all 

the selected civilian PSO programs, agency officials indicated that in most 

cases, they encourage individuals to return to work during the period of 

treatment, recovery, and evaluation to the extent their medical conditions 

allow; and that even if the individual is only able to work in a light-duty 

capacity, the full pre-injury salary is still provided. Moreover, the full preinjury salary generally continues to be provided for a period of time, even 

if the individual cannot return to duty, through explicit continuation of pay 

policies or special sick leave allocations. The length of time this benefit is 

provided varies, but, in general, we found the military’s continuation of 

pay policy to be more flexible than most of the civilian programs we 

reviewed. 

Continuation of Pay 

Provisions for Military 

Personnel Are Generally 

More Flexible 

The military will replace 100 percent of the servicemember’s salary until 

the individual either returns to duty or is released from service through 

separation or retirement. DOD instructions call for cases to be referred for 

evaluation no later than 1 year following injury, but this time frame may be 

extended in some cases. For example, DOD officials told us that 

extensions may be provided when there is an indication the

servicemember may be able to return to duty within a foreseeable amount 

of time. They also noted that continuation of pay is extended to cover the 

time between evaluation and final disposition, which can take up to 

90 days. 

Federal PSOs and most state and local PSOs we reviewed all have some 

type of continuation of pay provisions, either explicitly or through special

sick leave allocations, but the length of time this benefit is provided varies

widely. For example, federal PSOs have continuation of pay for up to 

45 days in cases of traumatic injury. Among the state and local programs 

with these provisions, some have a 1-year time limit, but others range from 

90 days to 2 years. (See table 1.) In most cases, these time limits are set in 

state statutes, and as a result, are less flexible than in the military; 

however, we found that some programs were willing to make extensions. 

For example, according to a Montana Highway Patrol official, although 

continuation of pay generally is provided for up to 1 year, in one recent

case it was provided for 2 years before it was determined that the officer 

would not be able to return to duty.

Page 12 GAO-06-4 Disability Benefits
Table 1: Continuation of Pay Provisions

Occupation 

Availability of continuation of pay (100% salary replacement) 

for line-of-duty injuries 

Military personnel Yes: Until return to duty or release from service. 

Federal PSOs Yes: 45 days maximum (for traumatic injury only).a

Selected state and local PSOs 

• California Highway Patrol and Los Angeles 

Firefighters 

Yes: 1 year maximum for state Highway Patrol and for Los Angeles 

Firefighters. 

• Florida Highway Patrol and Miami Firefighters Yes: 2 year maximum for State Police;b

 210 days maximum for Miami 

Firefighters. 

• Indiana State Police and Indianapolis Firefighters No, but 365 days per year of sick leave provided for State Police; 90 days

per year for Indianapolis Firefighters, and can be extended.

a

• Montana Highway Patrol and Billings Firefighters Yes: Generally 1 year and can be extended for state Highway Patrol and 

Billings Firefighters. 

• New Jersey State Police and Newark Firefighters No, but State Police and Newark Firefighters may take up to a year of sick

leave, with extensions in some cases. 

• Texas State Troopers and Houston Firefighters Yes: 1 year maximum for State Troopers;c

 also 1 year for Houston 

Firefighters, with possible extensions up to 2 years. 

Source: GAO analysis of state statutes and policies, and interviews with cognizant agency officials. 

a

These leave allocations for federal PSOs, Indiana State Police, and Indianapolis Firefighters are in 

addition to normally accrued sick leave. 

b

For Florida Highway Patrol and Miami Firefighters to qualify for these benefits, the injury must be a 

“malicious injury caused by another person.” According to agency officials, this requirement is 

interpreted very broadly. 

c

The Texas statute providing continuation of pay for law enforcement officers became effective June 

17, 2005. 

Military Personnel Have 

Access to Temporary 

Disability Retirement 

Benefits in Some Cases 

When an individual’s ability to return to duty is still uncertain after a 

period of continuation of pay or sick leave expires, some types of 

prolonged temporary benefits often are provided. In the military, a 

servicemember can be temporarily released from service and have access 

to temporary disability retirement benefits for up to 5 years, as well as 

disability compensation benefits, in some cases. In contrast, the civilian 

PSOs included in our study generally have access only to temporary 

disability compensation benefits, not disability retirement. The different 

way compensation benefits are calculated, combined with the availability 

of temporary disability retirement benefits, results in higher monthly 

payments for servicemembers in some cases, and lower monthly payments 

in others, when compared with the benefits provided selected civilian 

PSOs. Specifically, we found that the monthly payments for 

servicemembers with either higher disability ratings or with 20 years or 

more of service are generally higher than the monthly payments for the 

Page 13 GAO-06-4 Disability Benefits
selected PSOs in similar circumstances, while the monthly payments for 

servicemembers with either lower disability ratings or less than 20 years 

or service are generally lower. However, the length of time temporary 

benefits can be provided varies widely across programs. 

The basis for calculating compensation benefits for military personnel is 

different from that used for calculating civilian compensation benefits. 

Servicemembers are provided VA service-connected disability 

compensation benefits determined on the basis of the degree of injury, not 

salary level. VA evaluates the level of injury and assigns a disability rating 

ranging from 0 to 100 percent, in 10 percentage point increments, and each 

rating level corresponds to a fixed monthly payment amount, adjusted 

annually.22 (See table 2.) Additional benefits are provided for each 

dependent if the disability is rated 30 percent or more; for certain types of 

severe injuries such as the loss of use of a limb or sensory organ; and for 

various special circumstances such as the need for attendant care, 

inability to maintain gainful employment, having a spouse with a disability, 

or having a child age 18 or older attending school. In addition, VA can 

reassess a veteran’s condition over time and may increase or decrease the

disability rating as health deteriorates or improves.23

Table 2: Basic Monthly Compensation Rates for VA Disability in 2005 

Disability rating Monthly payment Disability rating Monthly payment 

10% $108 60% $839

20% $210 70% $1,056

30% $324 80% $1,227

40% $466 90% $1,380

50% $663 100% $2,299

Source: Department of Veterans Affairs. 

On the civilian side, federal PSOs receive temporary disability 

compensation benefits under FECA, and state and local PSOs generally 

receive temporary disability compensation benefits under state workers’ 

compensation statutes, with payments determined on the basis of a 

percentage of pre-injury salary up to a set maximum. Among the state and 

local PSOs included in our study, we found that all are provided workers’ 

 22A cost-of-living adjustment (COLA) is not guaranteed, but Congress has historically 

passed annual COLAs based on a percentage equal to the Social Security increase. 

23Re-examinations are required when it is likely a disability will improve over time, or when

there is evidence of an error or a material change in a disability. 

Page 14 GAO-06-4 Disability Benefits
compensation benefits, with payments based on a percentage of their 

salary up to a cap, except in Indiana. (See table 3.) As noted earlier, in 

Indiana, both the Indiana State Police and the Indianapolis Fire 

Department have opted to provide disability benefits only from their 

pension funds. 

Table 3: Temporary Compensation Payment Formulas and 2005 Payment Caps for Selected Civilian PSOs 

Occupation 

Compensation payment formula for 

temporary total disability 

Maximum monthly payment cap 

in 2005 

Federal PSOsaEmployee’s average weekly wage times 66-

2/3%, without dependents; 75% with 

dependents. 

$6,473 per month without dependents; 

$7,283 per month with dependents. 

Selected state and local PSOsb

• California Highway Patrol and Los 

Angeles Firefighters 

Maximum allowable average weekly earnings

times 66-2/3%. 

$3,460 per month. 

• Florida Highway Patrol and Miami 

Firefighters 

Employee’s average weekly wage times 66-

2/3% in most cases. 

$3,033 per month for the first 6 months;

$2,821 per month thereafter. 

• Montana Highway Patrol and Billings 

Firefighters 

Employee’s average weekly wage times 66-

2/3%. 

$2,253 per month. 

• New Jersey State Police and Newark 

Firefighters 

Employee’s average weekly wage times 70%, 

or the statewide average weekly wage times

75%, whichever is less. 

$2,886 per month. 

• Texas State Troopers and Houston 

Firefighters 

Employee’s average weekly earnings times 

70%. 

$2,336 per month. 

Source: GAO analysis of state statutes and policies. 

a

Payment caps for federal PSOs are based on the pay level for a General Schedule (GS)-15, step 10,

position, which was $116,517 per year ($9,710 per month) in 2005. 

b

For all of the selected state and local PSOs that have access to temporary disability compensation 

benefits, payment caps are based on a percentage of the state’s average weekly wage. 

Thus, if an individual is temporarily unable to work due to a line-of-duty 

injury or illness, compensation payments for servicemembers are based on 

the disability rating, regardless of salary level; in contrast, compensation 

payments for the selected civilian PSOs are based on salary level, 

regardless of disability level. As a result, as illustrated in figure 2, if an

individual has more severe injuries and lower wages, VA compensation 

payments are generally higher than the PSOs’ compensation benefits. But 

if an individual has less severe injuries and higher wages, VA 

compensation payments are generally lower than the PSO’s compensation 

benefits. 

Page 15 GAO-06-4 Disability Benefits
Figure 2: Military and Civilian Temporary Monthly Compensation Benefits in Two Contrasting Scenarios (2005 Payment 

Rates) 

Scenario Occupation Temporary monthly payments (2005 rates)

Military personnel

Federal PSOs

Selected state and local PSOsa

677

1,111

2,821

2,253

1,111

1,111

1,167

1,167

4,722

466

2,299

3,640

2,886

3,640

2,886

2,336

0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000

Texas State Troopers and

Houston Firefightersd

New Jersey State Police and

Newark Firefightersd

Montana Highway Patrol and

Billings Firefightersd

Florida Highway Patrol and

Miami Firefightersc

California Highway Patrol and

Los Angeles Firefightersb

Texas State Troopers and

Houston Firefighters

New Jersey State Police and

Newark Firefighters

Montana Highway Patrol and

Billings Firefighters

Florida Highway Patrol and

Miami Firefightersc

California Highway Patrol and

Los Angeles Firefightersb

Disability rating of 100%

Age 20, 1 year of service

Salary of $20,000

Disability rating of 40% 

Age 55, 32 years of service

Salary of $85,000

Military personnel

Federal PSOs

Selected state and local PSOsa

Dollars

Source: GAO analysis based on program provisions. 

Note: Calculations are based on the assumption that the individual is temporarily unable to return to 

duty due to a line-of-duty injury or illness. In such circumstances, payments for the selected PSOs are 

based on a percentage of salary regardless of disability rating. 

Page 16 GAO-06-4 Disability Benefits
a

Indiana State Police and Indianapolis Firefighters are not included in the figure because they are not 

provided prolonged temporary compensation benefits following the period of special sick leave 

allocation. 

b

California state statutes call for PSOs to have their benefits calculated based on the maximum 

allowable average weekly wage, regardless of actual earnings. 

c

Florida payment amounts shown here are based on the higher benefit rate allowed for the first 6 

months. (After 6 months, the benefit levels would drop to $1,111 for the individual earning $20,000,

and to $2,821 for the individuals earning $60,000 and $85,000.) 

d

Payment amount is based on a cap. 

However, unlike the civilian PSOs included in our study, military 

personnel whose ability to return to duty remains uncertain after the 

period of continuation of pay expires also may have access to DOD 

temporary disability retirement benefits. As with permanent disability 

retirement payments, servicemembers are eligible to receive temporary 

disability retirement payments if they are found unfit for duty and they 

have either (1) a disability rating of 30 percent or more, or (2) 20 years or 

more of service. Those who qualify may elect to have their temporary 

disability retirement payments calculated based on: 

• basic pay times 50 percent, 

• basic pay times the percentage of disability, or 

• basic pay times 2.5 percent times years of service.24

Regardless of which calculation method is used, the maximum temporary 

disability retirement payment that can be received is 75 percent of basic 

pay. 

When servicemembers are eligible to receive VA compensation benefits 

and DOD disability retirement benefits at the same time, the amount of the 

retirement payment is reduced (offset) dollar-for-dollar by the amount of 

the VA compensation payment, unless they have at least 20 years of 

service and can qualify for an exception to this offset due to a disability 

rating of 50 percent or more, or combat-related disabilities. (See earlier 

background section for further details.) Nevertheless, the added increment 

available from disability retirement, even with applicable offsets, can 

increase servicemembers’ monthly benefits significantly. As illustrated in 

 24For those who entered military service on or after September 8, 1980, basic pay is the

average of the highest 3 years of basic pay. For reserve component members, it is the

average of the last 36 months of basic pay as though the member were on full-time active 

duty. Basic pay does not include subsistence and housing allowances that often comprise a

significant portion of a servicemember’s total pay. 

Page 17 GAO-06-4 Disability Benefits
figure 3, if a servicemember with a 40 percent disability rating has an 

annual salary of $60,000 and 12 years of service, including the increment 

for temporary disability retirement boosts the temporary monthly payment 

above that of some of the comparable civilian PSOs included in our study. 

With an annual salary of $85,000 and 32 years of service, the increment 

boosts the monthly payment above that of all the comparable PSOs. 

Page 18 GAO-06-4 Disability Benefits
Figure 3: Military and Civilian Temporary Monthly Benefits for 40 Percent Disability Ratings, including Temporary Disability 

Retirement Benefits for Servicemembers (2005 Payment Rates) 

Scenario Occupation Temporary monthly payments (2005 rates)

Military personnel

Federal PSOs

Selected state and local PSOsa

833

1,111

2,821

2,253

1,111

1,167

1,167

3,640

3,333

4,722

1,111

3,640

2,500

3,640

2,886

2,336

Disability rating of 40% 

Age 20, 1 year of service

Salary of $20,000

Disability rating of 40% 

Age 35, 12 years of service

Salary of $60,000

Disability rating of 40% 

Age 55, 32 years of service

Salary of $85,000

Military personnel

Federal PSOs

Selected state and local PSOsa

Military personnel

Federal PSOs

Selected state and local PSOsa

Dollars

Source: GAO analysis based on program provisions. 

0 1,000 2,000 3,000 4,000 5,000 6,000

Texas State Troopers and Houston Firefightersd

New Jersey State Police and Newark Firefightersd

Montana Highway Patrol and Billings Firefightersd

Florida Highway Patrol and Miami Firefightersc

California Highway Patrol and Los Angeles Firefightersb

Texas State Troopers and Houston Firefightersd

New Jersey State Police and Newark Firefightersd

Montana Highway Patrol and Billings Firefightersd

Florida Highway Patrol and Miami Firefightersc

California Highway Patrol and Los Angeles Firefightersb

Texas State Troopers and Houston Firefighters

New Jersey State Police and Newark Firefighters

Montana Highway Patrol and Billings Firefighters

Florida Highway Patrol and Miami Firefightersc

California Highway Patrol and Los Angeles Firefightersb

5,313

2,336

2,886

2,253

2,821

Additional increment for temporary disability retirement benefits

(available for military personnel only)

Note: Calculations are based on the assumption that the individual is temporarily unable to return to 

duty due to a line-of-duty injury or illness. In such circumstances, payments for the selected PSOs are 

based on a percentage of salary regardless of disability rating. 

Page 19 GAO-06-4 Disability Benefits
a

Indiana State Police and Indianapolis Firefighters are not included in the figure because they are not 

provided prolonged temporary compensation benefits following the period of special sick leave 

allocation. 

b

California state statutes call for PSOs to have their benefits calculated based on the maximum 

allowable average weekly wage, regardless of actual earnings. 

c

Florida payment amounts shown here are based on the higher benefit rate allowed for the first 6 

months. (After 6 months, the benefit levels would drop to $1,111 for the individual earning $20,000,

and to $2,821 for the individuals earning $60,000 and $85,000.) 

 dPayment amount is based on a cap. 

e

Disabilities are assumed not to be combat related; thus, there is no exception to the offset. 

As was the case with continuation of pay, provisions regarding the length 

of time that temporary disability payments are provided while an 

individual’s condition remains uncertain also vary widely across programs. 

Military servicemembers may receive these payments for up to 5 years 

after the period of continuation of pay expires.25 At the federal level, PSOs 

may receive compensation payments indefinitely, as long as they are 

unable to work. At the state and local level, if the injured PSO’s condition 

is still uncertain following the period of continuation of pay or use of sick 

leave, temporary compensation payments are generally provided only up

to a set time limit, even if the ability to return to duty remains unclear. 

Among the state and local programs we reviewed, these time limits ranged 

from 104 weeks (2 years) to 400 weeks (7.7 years) (see table 4).26 Only in 

Montana did officials indicate that temporary compensation benefits 

would be provided indefinitely until maximum medical improvement was 

achieved, similar to the benefits for federal PSOs. 

 25During temporary disability retirement, the servicemember is treated the same as a 

regular retiree, and as such, no longer has access to certain benefits, such as subsistence 

and housing allowances. 

26In some programs, the clock on these temporary disability payments starts following the 

end of continuation of pay (such as the programs for federal PSOs and California Highway 

Patrol). In other programs, these payments are made simultaneous to continuation of pay,

with the employer recouping the payments from employees to help defray some of the cost

of providing the employee with continuation of pay while injured employees are not 

working (such as the programs for Florida and Montana Highway Patrol). In these 

programs, injured employees could only continue to receive temporary compensation 

payments for the amount of time left after the period of continuation of pay expires. 

Page 20 GAO-06-4 Disability Benefits
Table 4: Time Limits on Temporary Disability Benefits 

Occupation 

Length of time disability benefits may be provided following the period

of continuation of pay or sick leave 

Military personnel Up to 5 years, if disability is rated 30% or more, or if 20 years or more of 

service; also eligible to receive VA compensation benefits during this time, 

with applicable offsets. 

Federal PSOs Indefinitely, as long as the individual experiences wage loss or is unable to 

work.a

Selected state and local PSOs 

• California Highway Patrol and Los Angeles 

Firefighters 

Up to 104 weeks (2 years) in most cases, following the period of continuation 

of pay.b

• Florida Highway Patrol and Miami Firefighters Up to 2 years.c

 

• Indiana State Police and Indianapolis Firefighters Not applicable. (No temporary compensation benefits are provided following

the period of special sick leave allocation.) 

• Montana Highway Patrol and Billings Firefighters Indefinitely, until maximum medical improvement is achieved.

c

• New Jersey State Police and Newark Firefighters Up to 400 weeks (7.7 years). 

• Texas State Troopers and Houston Firefighters Up to 104 weeks (2 years) following continuation of pay. 

Source: GAO analysis of state statutes and policies. 

a

For federal PSOs to qualify indefinitely, the individual must be unable to work at any job, not just the 

previous position held pre-injury. 

b

In California, benefits can be extended for up to a total of 240 weeks over 5 years for certain 

disabilities, such as hepatitis, amputations, severe burns, HIV, high velocity eye injuries, chemical 

burns to the eyes, pulmonary fibrosis, and chronic lung disease. 

c

In Florida and Montana, these benefits run concurrently with continuation of pay. 

Once a line-of-duty injury is determined to be permanent, program 

provisions governing the benefits available for partial disabilities 

sometimes result in greater benefits for military personnel, and at other 

times result in greater benefits for the civilian PSOs we reviewed, 

depending on an individual’s circumstances. Key factors affecting the 

amount of benefits provided over a lifetime include the type and degree of 

impairment, and whether the impairment prevents the individual from 

returning to duty. In most cases of line-of-duty permanent partial 

disability, servicemembers and civilian PSOs can receive disability 

compensation benefits. If unable to return to duty, they may also be 

eligible to receive disability retirement benefits. However, we found the 

criteria for benefit receipt, the way benefits are calculated, and the 

combined amount of benefits provided over a lifetime vary widely across 

programs for individuals with the same age, years of service, and salary 

level. 

Permanent Partial 

Disability Benefits 

Are Greater over a 

Lifetime for Military 

Personnel or Civilian 

PSOs, Depending on 

Individual 

Circumstances 

Page 21 GAO-06-4 Disability Benefits
For both military personnel and the selected civilian PSOs, the type and 

degree of impairment are key factors in determining the amount of 

compensation benefits for permanent partial disabilities. In addition, 

whether the type and degree of impairment prevents an individual from 

returning to duty is the key factor in determining eligibility for disability 

retirement benefits. But the specifics of how benefits are calculated vary 

considerably across programs. 

Compensation benefits for permanent partial disability are based on the 

type and degree of impairment for both military personnel and for civilian 

PSOs. However, the way the impairment level is factored into the 

calculation of benefits for military personnel differs significantly from the 

way it is factored into the calculation of benefits for the civilian PSOs we 

reviewed. 

Degree of Impairment 

Affects Benefits for 

Permanent Partial 

Disabilities in Different 

Ways across Programs 

Disability compensation

benefits for permanent partial 

disability 

For military personnel with permanent partial disabilities, the degree of 

impairment determines the monthly VA compensation payment amount, 

the same as described earlier for temporary VA compensation benefits. 

These compensation payments for permanent disabilities are provided 

only after the servicemember has been released from service through 

separation or retirement. But the payments are provided for the remainder 

of life, adjusted annually, as long as the impairment persists. 

Civilian PSOs with permanent partial disabilities also receive 

compensation based on the degree of impairment (sometimes referred to 

as an impairment or schedule award). In contrast with military personnel, 

however, the degree of impairment does not affect the amount of the 

recurring compensation payments, but rather the length of time the 

payments are provided. The amount of the monthly payment is generally

based on a percentage of the pre-injury salary up to a cap and, among the 

programs we reviewed, is generally the same as the monthly payment 

provided for temporary compensation. The payments for permanent 

disabilities are provided immediately, once the disability is determined to 

be permanent, regardless of whether or not the individual returns to duty. 

But the length of time payments are provided varies widely, depending on

degree of impairment. A relatively minor impairment may result in benefits

for a few weeks, while a more severe impairment may result in benefits for 

several years. In addition, some programs provide wage loss benefits 

Page 22 GAO-06-4 Disability Benefits
based on a percentage of the difference between pre-injury and post-injury 

salary levels.27

In general, civilian workers’ compensation programs use one of two basic 

methods to determine the length of time to provide compensation benefits

for permanent partial disabilities. The first method relies on a schedule of 

weeks that benefits are to be paid for specific types of impairments. This is 

the method used for federal PSOs. The second method uses one or more of 

the following factors to determine a disability rating: (1) the physical or 

psychological impairment, (2) an estimate of future wage loss, and/ or 

(3) actual wage loss. In assessing the physical or psychological 

impairment, many state workers’ compensation programs require 

physicians to use the American Medical Association (AMA) Guides to the 

Evaluation of Permanent Impairment, while other states have developed 

guides unique to their states. An initial impairment rating based on the 

AMA Guides or its equivalent is then used, either directly or indirectly, to 

determine the disability rating that is correlated with a specific length of 

time compensation benefits will be provided. This is the method generally

used by the selected state workers’ compensation programs included in 

our study. Table 5 describes the maximum length of time compensation 

payments can be provided for permanent partial impairments among the 

programs we reviewed.

 27VA does not provide wage loss benefits per se; however, veterans with disability ratings of

60 percent or more who are unable to secure employment due to their service-connected

disabilities may be eligible to receive additional compensation at the 100 percent disability 

rate (referred to as Individual Unemployability benefits). 

Page 23 GAO-06-4 Disability Benefits
Table 5: Time Limits on Compensation for Permanent Partial Disabilities 

Occupation 

Maximum period of time compensation payments can be provided for 

permanent partial disabilities 

Military personnel No time limit regardless of degree of impairment (10% to 90%); payments are 

provided for the remainder of life, as long as the impairment persists. 

Federal PSOs Up to 312 weeks (6 years) for schedule awards due to the loss of an arm, or the 

loss (or loss of use) of any other important external or internal organ of the body. 

In the case of multiple impairments, benefits can be received for each loss and 

the awards run consecutively, with no specified limit. Following a schedule award, 

wage loss benefits may be received indefinitely, as long as post-injury wages are 

less than wages earned pre-injury. 

Selected state and local PSOsa

• California Highway Patrol and Los Angeles 

Firefighters 

Up to 429.25 weeks (8.25 years) for an adjusted permanent disability rating of 

69.75%; payments for the remainder of life for a rating of 70% or more. 

• Florida Highway Patrol and Miami Firefighters Up to 535 weeks (10.3 years). 

• Montana Highway Patrol and Billings 

Firefighters 

Up to 375 weeks (7.2 years). 

• New Jersey State Police and Newark 

Firefighters 

Up to 600 weeks (11.5 years). 

• Texas State Troopers and Houston 

Firefighters 

Up to 300 weeks (5.8 years).b

 

Source: GAO analysis of program provisions.

a

In Indiana, both the Indiana State Police and the Indianapolis Fire Department have opted to provide

disability benefits only from their pension funds following a period of special sick leave. 

b

Alternatively, in Texas, when the permanent impairment rating is at least 15% and the post-injury 

wage is less than 80% of the pre-injury wage, supplemental benefits may be received for up to 

401 weeks (7.7 years), including weeks of benefit receipt for temporary, impairment, and 

supplemental benefits combined.

The eligibility criteria for disability retirement benefits due to a line-ofduty injury or illness vary across programs. In most programs reviewed, 

line-of-duty permanent partial disabilities that prevent individuals from 

returning to duty in their current jobs generally would enable them to 

receive disability retirement benefits. In the military, servicemembers who 

are unfit for duty are eligible for disability retirement benefits if they have 

a disability rating of 30 percent or more regardless of length of service, or

if they have 20 years or more of service regardless of disability rating.28

Federal PSOs must be unfit for duty and have 18 months of service under 

FERS to qualify for disability retirement benefits. Among the selected state 

Disability retirement benefits 

for permanent partial disability 

 28If servicemembers are unfit for duty but they have fewer than 20 years of service, and 

they have a disability rating of less than 30 percent, they may be eligible to receive a lumpsum disability severance payment. See app. II, military personnel, for details. 

Page 24 GAO-06-4 Disability Benefits
and local PSOs we reviewed, most would have access to disability 

retirement benefits regardless of length of service if they are found unfit 

for duty.29 In Florida, however, in addition to being unfit for duty in the 

current position, in order to qualify for disability retirement benefits, 

Highway Patrol Officers must be unable to be gainfully employed by any 

employer. 

Programs generally calculate disability retirement benefits based on a 

percentage of salary. In the military, servicemembers may elect to have 

their disability retirement benefit calculated using length of service or 

their disability rating,30 whichever is greater, up to a cap of 75 percent.31

Among the civilian PSOs we reviewed, some programs use different 

formulas for calculating disability retirement benefits, depending on the 

individual’s circumstances, such as length of service, or the type or degree 

of impairment. For example, as shown in table 6, programs for federal 

PSOs, and for PSOs in Montana and Texas, use a higher percentage for 

calculating disability retirement benefits for those with 20 years or more of 

service compared to those with fewer years of service.32 Other programs, 

such as for Indianapolis and Houston Firefighters, use different 

calculations depending on the type or degree of disability sustained. For 

example, benefits for Indianapolis Firefighters are calculated differently

based on whether the disability is due to injury or disease. Benefits for 

 29In several locations, state and local PSOs can opt into a special retirement program,

referred to as a Deferred Retirement Option Plan (DROP). DROP programs have been

established across the country as a means of retaining experienced PSOs beyond when

they would be eligible for normal retirement. These programs create an additional 

retirement account with a guaranteed rate of return that produces a new benefit in addition

to the standard retirement benefit. However, when PSOs opt into a DROP program, they

generally are no longer eligible to receive disability retirement benefits. 

30Once a servicemember is found to be unfit for duty, DOD assigns a disability rating using

the VA’s rating schedule to determine the degree (percent) of disability. 

31Unlike with temporary disability retirement payments; however, there is no minimum 

payment of 50 percent of basic pay. 

32Where provided, the alternative formulas for those with more years of service generally 

result in disability retirement benefits that are at least equal to, if not more than, the

benefits available under normal retirement based on age and length of service. For federal

PSOs, however, disability retirement benefits are less than normal voluntary retirement

benefits, despite the use of the same formula. This is because under normal voluntary

retirement, a special retirement supplement is provided until age 62 that approximates the

Social Security benefit earned in federal service. This benefit is not provided for those

taking disability retirement. As a result, officials told us that virtually no one eligible for 

both disability retirement and normal voluntary retirement chooses to take disability 

retirement benefits. 

Page 25 GAO-06-4 Disability Benefits
Houston Firefighters are calculated differently depending on whether the 

disability prevents them from returning to duty as a firefighter, or prevents

them for engaging in any gainful employment. 

Table 6: Disability Retirement Benefit Formulas for Military Personnel and Selected PSOs 

Occupation Disability retirement benefit formulas 

Military personnel The greater of:

• 2.5% of basic pay or high 36-month average, as applicable, at the time of injury for 

each year of service or 

• basic pay or high 36-month average, as applicable, multiplied by the percent of 

impairment. 

Benefits are capped at 75% of basic pay regardless of calculation method. 

Federal PSOs • If under age 50 with fewer than 20 years of service: 60% of average high-3 salary 

for first year of disability; 40% of average high-3 salary thereafter, until the individual 

reaches age 62. Benefits are recalculated at age 62 based on the normal retirement 

formula for regular federal employees (not PSOs). 

• If age 50 or over with 20 years of service, or any age with 25 years of service: 1.7% 

of average high-3 salary for each year of service up to 20, plus 1.0% of the average 

high-3 salary times years of service exceeding 20. 

Selected state PSOs 

• California Highway Patrol The greater of:

• 50% of the employee’s final compensation or

• 3% of final compensation for each year of service. 

Benefits are capped at 90% of final compensation regardless of calculation method. 

• Florida Highway Patrol 65% of average final compensation. 

• Indiana State Police 70% of the officer’s average high-3 salary for first 2 years of receipt, 50% of the officer’s 

average high-3 salary thereafter, until eligible for normal retirement. 

Benefits end when the individual is eligible for normal retirement, based on 25 years of 

service (including years receiving disability retirement), and normal retirement benefits 

are then provided instead. 

• Montana Highway Patrol • If fewer than 20 years of service: 50% of average highest salary. 

• If 20 years of service or more: 2.5% of average highest salary for each year of 

service. 

• New Jersey State Police 66-2/3% of salary at the time of injury. 

• Texas State Troopers • If fewer than 20 years of service: 50% of average highest salary. 

• If 20 years of service or more: 2.8% of average highest salary for each year of 

service. 

Selected local PSOs 

• Los Angeles Firefighters 30% to 90% of final salary, depending on the level of disability (but no less than 2% for 

each year of service). 

Benefits are capped at 90% of final average salary. 

• Miami Firefighters 66-2/3% of salary at the time of injury or highest salary, whichever is greater. 

Page 26 GAO-06-4 Disability Benefits
Occupation Disability retirement benefit formulas 

• Indianapolis Firefighters • If duty-related disability due to injury: 55% to 90% of base salary, depending on the 

degree of impairment. Benefits are capped at 90% of a first-class firefighter’s 

monthly salary.

• If duty-related disability due to disease: 22% of base salary, plus 0.5% for each year 

of service up to 30 years, plus an additional amount based on the degree of

impairment. Benefits are capped at 82% of a first-class firefighter’s monthly salary. 

At age 52, benefits are recalculated based on the formula for normal service retirement: 

50% of base salary, plus 1% for each 6 months of active service over a 20-year period. 

Benefits are capped at 74% of base salary. 

• Billings Firefighters • If fewer than 20 years of service: 50% of average highest salary. 

• If 20 years of service or more: 2.5% of average highest salary for each year of 

service. 

• Newark Firefighters 66-2/3% of salary at the time of injury. 

• Houston Firefighters If injury prevents employment as a firefighter (occupational disability), the greater of: 

• 50% of average monthly salary or 

• 50% of average monthly salary for 20 years of participation, plus 3% of average 

monthly salary for each year of participation over 20 years. 

If injury prevents any gainful employment (general disability), the greater of: 

• 75% of average monthly salary or 

• 50% of average monthly salary for 20 years of participation, plus 3% of average 

monthly salary for each year of participation over 20 years. 

Benefits are capped at 80% of average monthly salary. 

Source: GAO analysis of selected disability retirement provisions. 

When an individual with permanent partial disabilities is eligible to receive

both compensation and disability retirement benefits, we found that offset 

provisions among the programs we reviewed represent the range of 

possible policies: concurrent receipt permitted with an offset, concurrent 

receipt permitted with no offset, and concurrent receipt not permitted. 

For example, DOD disability retirement benefits generally are reduced 

(offset) dollar-for-dollar when VA disability compensation benefits are 

received; however, military veterans with 20 years or more of service and a 

disability rating of 50 percent or more are having this offset phased out 

over a 10-year period, and those with 20 years or more of service and

combat-related disabilities may be eligible for a special benefit equal to the 

offset. (See earlier background section for further details.) 

Concurrent receipt provisions 

for permanent partial disability 

On the civilian side, federal PSOs may receive disability retirement 

benefits and compensation benefits with no offset in some situations, but

not in others, depending on the type of benefits. Two types of 

compensation benefits are available to federal PSOs with permanent 

partial disabilities: impairment awards (referred to as schedule awards) 

and wage loss benefits (which are provided after the schedule award 

Page 27 GAO-06-4 Disability Benefits
expires if an individual is unable to earn as much as could be earned preinjury). Schedule awards may be received concurrently with disability 

retirement benefits with no offset. In contrast, wage loss benefits may not 

be received concurrently with disability retirement benefits. 

As summarized in table 7, offset provisions also vary among the programs 

providing benefits to the state and local PSOs we reviewed. For example, 

California Highway Patrol Officers can receive compensation benefits for 

permanent partial disability and disability retirement benefits without an 

offset, but Los Angeles Firefighters cannot. In Miami, an offset comes into 

effect only if the total combined benefits exceed the amount of the PSO’s 

pre-injury salary. 

Table 7: Concurrent Receipt Provisions for Permanent Partial Disabilities 

Concurrent receipt of disability compensation and disability retirement benefits 

Occupation Allowed with no offset Allowed with offset Not allowed 

Military personnel ●a

Federal PSOs ●b●b

Selected state PSOsc

• California Highway Patrol ●

• Montana Highway Patrol ●b

●b

• New Jersey State Police ●d

• Texas State Troopers ●

Selected local PSOse

• Los Angeles Firefighters ●f

• Miami Firefighters ●g

• Billings Firefighters ●b

●b

• Newark Firefighters ●d

• Houston Firefighters ●

Source: GAO analysis of program provisions.

a

In general, military disability retirement benefits are reduced dollar-for-dollar for any compensation 

benefits received; however, this offset is being phased out for veterans with a disability rating of 50% 

or more and with 20 years or more of service. (See app. II, military personnel, for details.) 

b

For federal PSOs, Montana Highway Patrol, and Billings Firefighters, concurrent receipt is allowed 

with no offset for an impairment award, but concurrent receipt is not allowed with wage loss benefits.

c

Florida is not included in the table because disability retirement benefits are provided only for 

permanent total disability. Indiana is not included in this table because compensation benefits are not 

provided to Indiana State Police. 

d

In New Jersey and Newark, disability retirement benefits are reduced dollar-for-dollar for any

compensation benefits received. 

Page 28 GAO-06-4 Disability Benefits
e

Indianapolis is not included in this table because compensation benefits are not provided to 

Indianapolis Firefighters. 

f

Not only is concurrent receipt not allowed, when Los Angeles Firefighters take disability retirement, 

they must repay any compensation payments received for any disability incurred throughout their 

careers. 

g

In Miami, workers’ compensation is offset to prevent benefits from totaling more than 100 percent of

pre-injury income. 

When Able to Return to 

Duty, Compensation 

Benefits for Military 

Personnel Are Not Paid 

Immediately, but Amount 

Received over a Lifetime Is 

Generally Greater 

When servicemembers or civilian PSOs are able to return to duty in their 

previous position with a permanent partial impairment, such as may be the 

case with tinnitus (ringing in the ears), disability retirement benefits would 

not be available, but disability compensation payments generally would be 

provided. The selected state and local PSOs we reviewed can receive

compensation benefits for permanent disabilities immediately, whereas 

servicemembers cannot receive VA compensation benefits until they are 

released from service through separation or retirement. Nevertheless, 

because the PSOs’ benefits are generally time limited, whereas military 

veterans can receive benefits for the remainder of life, our analysis shows 

that veterans often would receive a greater amount of compensation 

benefits over a lifetime, even when the monthly benefit payment is 

substantially lower and receipt of benefits is delayed for several years. 

With respect to our hypothetical scenarios, officials administering 

disability programs for servicemembers and PSOs told us that in most 

circumstances, an individual with tinnitus would not be found unfit for 

duty.33 In the military, no disability compensation would be paid until the 

servicemember is released from military service. Once released from 

service, however, a servicemember with tinnitus would be assigned a 

10 percent disability rating, which corresponds to a VA compensation 

benefit amount of $108 per month based on rates effective in 2005. This 

benefit then would be provided for the remainder of life, adjusted 

annually. 

On the civilian side, according to the AMA Guides, up to 5 percent can be

added to a disability rating for tinnitus in the presence of measurable 

hearing loss if it affects activities of daily living. Some program officials—

such as from the U.S. Department of Labor and from California’s Labor 

and Workforce Development Agency—indicated that they most likely 

 33Across all programs, we were told that whether an individual is found unfit for duty 

depends on the specific duties of his or her position, and the extent to which the disability 

prevents successful performance of those duties. 

Page 29 GAO-06-4 Disability Benefits
would not provide any compensation for tinnitus alone. However, to 

compare benefits across programs, we asked program officials to assume 

that civilian PSOs with tinnitus are rated by physicians as having a 

5 percent impairment due to hearing loss (which can be rated and 

compensated independently) and to calculate compensation benefits at a 

5 percent level. 

Among the civilian PSOs we studied, an individual with a 5 percent 

impairment rating from a physician would receive compensation benefits

for set periods of time ranging from 2.3 months (10 weeks) in Florida and 

New Jersey to 9.8 months (just over 42 weeks) for more senior California 

PSOs (that is, those age 55 with 32 years of service). Despite equal 

hypothetical salaries across programs, the payment amounts vary due to 

different formulas and caps. For example, compensation payments for 

PSOs with an annual salary of $85,000 ranged from $770 per month in New 

Jersey to $4,722 per month for those in federal law enforcement, based on

payment rates effective in 2005.34 In addition, unlike the payments for 

servicemembers, these payments would begin immediately upon the 

determination that the injury is permanent, even when the PSOs return to 

duty and receive their salaries at the same time. 

To compare the compensation benefits available to military veterans with 

the benefits available to the selected civilian PSOs, we calculated the 

present value of the lifetime payments that would be provided for tinnitus 

to five individuals with varying ages, lengths of service, and salary levels 

(see fig. 4). Because we are assuming the injury is not sufficient to prevent 

an individual from returning to duty, when the servicemember chooses to 

leave the military is an important factor in determining the lifetime present 

value of benefits for military personnel as VA compensation benefits 

would not be available until the servicemember is released from service. 

Therefore, in one scenario, we assume that the servicemember chooses to 

separate from service at the earliest opportunity.35 In a second scenario, 

we assume that the servicemember chooses to leave the military only after 

reaching 20 years of service. As illustrated in figure 4, in the first scenario, 

 34For more detailed information across all hypothetical scenarios and programs reviewed, 

see app. IV, table 10. 

35For purposes of our analysis, we assume that the servicemembers’ tours of duty are such 

that, although still fit for duty, they can choose to separate immediately upon the 

determination of a permanent disability, with one exception: We assume that the 

servicemember with only 1 year of service must complete 2 years of service before being 

able to choose to separate. 

Page 30 GAO-06-4 Disability Benefits
when leaving service at the earliest opportunity, military veterans receive 

more benefits over a lifetime than the selected civilian PSOs by a 

substantial margin due to the longer period of time they would receive

benefits. In the second scenario, when leaving after 20 years of service, 

military veterans still receive more benefits than the PSOs, but by a 

smaller margin. 

Figure 4: Comparison of Present Value of Compensation Benefits over a Lifetime 

for Tinnitus

Dollars

Source: GAO analysis.

Military veterans leaving service at earliest opportunitya

Military veterans leaving service only after 20 years of service

Federal PSOs

Range of benefits for selected state and local PSOs

0

5000

10000

15000

20000

25000

30000

35000

0

50,00

10,000

15,000

20,000

25,000

30,000

35,000

Age 55, 32 years of service,

Age 45, 22 years of service,Age

35, 12 years of service,

Age 25, 6 years of service,

Age 20, 1 year of service,

salary of $20,000

salary of $40,000

salary of $60,000

salary of $85,000

salary of $85,000

Note: Calculations for federal PSOs, and the selected state and local PSOs, are based on the 

assumption that tinnitus is rated by physicians as a 5% hearing impairment that can be rated and 

compensated independently. See app. IV for details on methods and table 10 for more detailed data 

for the selected state and local PSOs. 

Page 31 GAO-06-4 Disability Benefits
a

We assume that the servicemembers, though still fit for duty, choose to leave the military at the

earliest opportunity. We assume that the servicemember with only 1 year of service must complete 

2 years of service before being able to choose to separate. For all others, we assume that the 

servicemembers’ tours of duty are such that they can choose to separate immediately upon the 

determination of a permanent disability.

When Unable to Return to 

Duty, Amount of Disability 

Benefits over a Lifetime 

for Military Veterans Is 

Sometimes More and 

Sometimes Less than the 

Amount of Benefits for the 

Selected PSOs 

Due to the physical demands of military service, law enforcement, and 

firefighting, individuals in these occupations who sustain a permanent 

partial disability often are not able to return to duty in their previous 

positions. In such circumstances, disability retirement benefits may be 

provided in addition to compensation benefits. We found that when 

servicemembers and the civilian PSOs we reviewed are unable to return to

duty due to a permanent partial disability, such as a leg amputation, the 

combined compensation and retirement benefits provided to military 

personnel over a lifetime are sometimes more, and sometimes less, than 

the combined benefits provided to the selected PSOs we reviewed. In 

addition, although servicemembers and PSOs who sustain a permanent 

partial disability may not be able to return to duty, they may still be able to 

be gainfully employed in another type of job. We found that disability 

retirement programs for servicemembers and most of the selected PSOs 

we reviewed require post-injury employment to be under a different 

retirement system, but most do not place any limits on the amount of postretirement earnings. 

With respect to our hypothetical scenarios, officials administering 

disability programs for servicemembers and PSOs told us that in most 

circumstances, an individual with an amputated leg would be found unfit 

for duty. In the military, once found unfit, a leg amputated below the knee 

would be assigned a 40 percent disability rating, thus entitling a 

servicemember to DOD disability retirement benefits, and VA monthly 

compensation benefits of $466, plus $84 per month in special

compensation for this type of injury, based on rates effective in 2005. Total 

VA compensation benefits of $550 per month, adjusted annually, would be 

provided for the remainder of life, in addition to disability retirement 

benefits, taking into account any applicable offsets. The added increment 

for military disability retirement benefits would vary based on the 

servicemember’s salary and years of service. 

On the civilian side, according to the AMA Guides, a leg amputated below 

the knee less than 3 inches would be rated at 32 percent. Among the 

civilian PSOs we studied, a 32 percent impairment rating from a physician 

would correlate with compensation benefits being provided for set periods 

of time ranging from just under 22 months (just under 2 years) for Texas 

PSOs, to 73.7 months (just over 6 years) for more senior California PSOs 

Page 32 GAO-06-4 Disability Benefits
(that is, those age 55 with 32 years of service). Despite equal hypothetical 

salaries across programs, monthly compensation payment amounts would 

vary due to different formulas and caps, as was the case with tinnitus. In 

addition, most of the PSOs included in our study would be eligible for 

disability retirement benefits, except for Florida Highway Patrol Officers.36

The added increment for civilian disability retirement benefits varies 

based on the program’s concurrent receipt provisions, and the PSO’s age, 

length of service, and salary level. 

To compare the combined compensation and disability retirement benefits

available to military veterans with the benefits available to the selected 

civilian PSOs, we calculated the present value of the combined payments

that would be provided over a lifetime for a leg amputated below the knee 

to five individuals with varying ages, lengths of service, and salary levels, 

taking into account the relevant concurrent receipt and offset provisions. 

Although these individuals could not return to duty in their previous 

positions, we assumed that they secure employment with an alternative

employer and earn 75 percent of their previous pay. As illustrated in figure 

5, the combined benefits received over a lifetime for military veterans are 

more than the combined benefits for some of the selected PSOs, but less 

than others, in these circumstances. For example, Florida Highway Patrol 

Officers and Texas State Troopers generally would receive less combined 

benefits than comparable military veterans, whereas Indianapolis and 

Houston Firefighters generally would receive more combined benefits 

than comparable military veterans. (For detailed data for the selected state 

and local programs, see app. IV, table 11.) 

 36Florida PSOs are not eligible for disability retirement benefits unless they are unable to 

engage in any employment, not just their pre-injury occupation. 

Page 33 GAO-06-4 Disability Benefits
Figure 5: Comparison of Present Value of Combined Disability Benefits over a 

Lifetime for a Leg Amputation 

0

200000

400000

600000

800000

1000000

1200,,,000

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

Age 55, 32 years of service,

Age 45, 22 years

of service,

Age 35, 12 years of service,

Age 25, 6 years

of service,

Age 20, 1 year of 

service,

Dollars

Source: GAO analysis.

Military veterans

Federal PSOs

Range of benefits for selected state and local PSOs

salary of $20,000

salary of $40,000

salary of $60,000

salary of $85,000

salary of $85,000

Note: See app. IV for details on methods and table 11 for more detailed data for the selected state 

and local PSOs.

A key factor affecting the combined benefits amounts illustrated above is

whether or not the programs place restrictions on post-retirement 

employment and earnings. When servicemembers or civilian PSOs are 

unable to return to their previous positions due to permanent partial 

disabilities, they may still be capable of gainful employment in other 

positions or occupations. If disability retirement programs place 

restrictions on post-retirement employment and earnings, such restrictions 

can have an impact on an individual’s benefit amounts and ability to earn 

future income. As shown in table 8, several programs we reviewed require 

post-injury employment to be under a different retirement system, but 

most do not place any limits on the amount of post-retirement earnings. 

Page 34 GAO-06-4 Disability Benefits
Those that do limit earnings include programs for federal PSOs, and for 

state PSOs in California, Florida, Montana, and Texas. 

Table 8: Post-Retirement Employment and Earnings Restrictions on Receipt of Disability Retirement Benefits 

Occupation Post-retirement employment restrictions Post-retirement earnings restrictions

Military veterans No military employment.aNo restrictions.

Federal PSOs If re-employed in federal government, salary is 

offset by the amount of the disability retirement 

payment. 

If under age 60, may not have earnings of 

80% or more of salary for pre-injury position. 

Selected state PSOs 

• California Highway Patrol No employment in a position similar to the one

from which retired on disability. 

Earnings combined with the disability 

retirement cannot exceed 100% of the 

maximum compensation of the pre-injury 

position.c

• Florida Highway Patrolb

No gainful employment. May not have any substantial earnings. 

• Indiana State Police No work activities that are similar to those that the 

person is unable to perform as a State Police 

Officer due to the disability. 

No restrictions.

• Montana Highway Patrol No law enforcement employment. No wages from a law enforcement position. 

• New Jersey State Police No employment covered by the State Police 

Retirement System. 

No restrictions.

• Texas State Troopers No employment that provides comparable pay to 

the pre-injury position. 

Cannot receive earnings equal to or greater 

than earnings in the pre-injury position. 

Selected local PSOs 

• Los Angeles Firefighters No employment that violates the restrictions of the 

disability. 

No restrictions.

• Miami Firefighters No restrictions on employment outside of the

Miami Fire Department. 

No restrictions.

• Indianapolis Firefighters No employment that is associated with an

accommodation or light duty with the same 

employer. 

No restrictions.

• Billings Firefighters Employment under the same retirement system 

limited to 960 hours per year. 

No restrictions.

• Newark Firefighters No employment covered by the Police and 

Firefighters Retirement System. 

No restrictions.

• Houston Firefighters No restrictions on alternative employment for 

receipt of occupational disability benefits.d

No restrictions.

Source: GAO analysis of program provisions.

a

Restrictions for military veterans include federal judgeships and certain types of employment with 

foreign governments. 

b

In Florida, disability retirement benefits are available only for officers with total and permanent 

disabilities.

c

In California, an officer’s earnings, when combined with disability retirement, are offset if they exceed 

100% of maximum earnings of the pre-injury occupation. 

Page 35 GAO-06-4 Disability Benefits
d

Houston Firefighters receiving general disability benefits (for total disability) may not maintain any

gainful employment. 

When a permanent injury is severe enough to be deemed a total disability,37

military veterans may receive more or less benefits than civilian PSOs, 

depending on the type of impairment and individual circumstances. The 

military and civilian programs we reviewed provide various enhanced 

benefits for certain cases of permanent total disability, including increased 

disability compensation benefits, concurrent receipt of compensation and 

disability retirement benefits with no offset, or special lump-sum benefits 

for certain civilian PSOs. The amount of the combined benefits over a 

lifetime for military veterans and civilian PSOs with permanent total 

disabilities depends on the extent to which individuals qualify for these 

various enhanced benefits. 

Permanent Total 

Disability Benefits 

Are Greater over a 

Lifetime for Military 

Veterans or for 

Civilian PSOs, 

Depending on the 

Type of Impairment 

Military Veterans and 

Civilian PSOs with Total 

Disabilities Have Access to 

a Range of Enhanced 

Benefits 

In cases of permanent total disability, military veterans and the selected 

civilian PSOs we reviewed have access to a range of enhanced benefits. 

Depending on an individual’s specific circumstances, these benefits may

include higher disability compensation and retirement payments, a special 

lump-sum benefit for civilian PSOs only, or several other types of 

additional benefits, including SSDI.

Among the programs we reviewed that provide disability compensation 

benefits, all provide greater benefits for permanent total disability than for 

permanent partial disability.38 For military veterans, the monthly payment 

for total disability is increased substantially over the amounts available for

partial disabilities. For instance, the $2,299 monthly payment in 2005 for a 

100 percent disability rating is over $900 per month more than the payment 

for a 90 percent disability rating (see earlier table 2). In addition, VA 

provides an enhanced set of compensation payments for certain severe 

injuries above and beyond the compensation provided for permanent total 

disability with a 100 percent rating. These higher special monthly 

compensation (SMC) payments are for military veterans who sustain 

particularly severe injuries, such as amputations, blindness, or other loss 

Disability compensation

benefits for permanent total 

disability 

 37Across the programs we reviewed, permanent total disability generally means that an

individual is unable to maintain gainful employment. See app. VIII for individual program

definitions of what qualifies for permanent total disability. 

38In Indiana, both the Indiana State Police and the Indianapolis Fire Department have opted 

to provide disability benefits only from their pension funds following a period of special 

sick leave allocation. 

Page 36 GAO-06-4 Disability Benefits
of use of organs and extremities. As described in table 9, the SMC rates are 

designed to account for attendant care or other special needs deriving 

from the disability. 

Table 9: Basic Total and SMC Rates for VA Disability in 2005 

Basic Total Disability Compensation Rate Monthly payment

Disability rating: 100% $2,299

SMC Rate Category Description 

SMC-L: Loss of use of more than one extremity (hand or foot), blindness, permanently bedridden, or in need 

of regular aid and attendance. $2,860

SMC-M: Loss of use of extremities (hand or foot) with complications, or more severe blindness, rendering 

need for regular aid and attendance. $3,155

SMC-N: Loss of use of extremities (arms or legs) and unable to use prostheses, or even more severe

blindness. $3,590

SMC-O/P: More severe injuries, or multiple injuries each entitled to special compensation. $4,012

SMC-R.1: Any injury entitled to special compensation in categories SMC-N or SMC-O/P and in need of 

regular aid and attendance. $5,734

SMC-R.2: Any injury entitled to special compensation in categories SMC-N or SMC-O/P and in need of a 

higher level of care. $6,576

SMC-S: Multiple injuries, one rated at 100% plus another rated at 60% or more, or injuries causing the 

veteran to be permanently housebound. $2,573

Source: Department of Veterans Affairs. 

Note: Plus, SMC-K provides for an added $84 for each loss due to certain types of injuries (such as

anatomical loss of use of certain organs or extremities), up to a total maximum monthly payment of 

$4,012, not including dependents. Added increments are also provided for each dependent if the 

disability is rated 30% or more (with the amount of the increment varying by level of injury and type of

dependent). 

For civilian PSOs, the monthly payment amounts for total disability are 

generally the same as for permanent partial disability, but are provided for 

life rather than for a limited time period.39 Civilian payment rates are not 

increased to account for attendant care; however, federal PSOs may be 

eligible for an additional attendant allowance—up to $1,500 per month 

during 2005—if such care is needed. This amount is not incorporated into

the compensation payment, but rather is provided separately to the care

provider. Among the state and local programs we reviewed, it is possible 

that attendant care costs may be covered as a medical expense, but state 

 39In California, benefits are received for life for injuries rated 70 percent or higher, but the

calculation of benefits for injuries rated 70 to 99 percent is different than for injuries rated 

100 percent. 

Page 37 GAO-06-4 Disability Benefits
and local statutes and program rules do not address such costs 

specifically.

In addition to disability compensation, military veterans and nearly all the 

selected civilian PSOs we reviewed have access to disability retirement 

benefits for permanent total disability (see earlier table 6 for disability 

retirement benefit formulas).40 Military veterans who retire due to 

permanent total disability may receive enhanced benefits compared with

veterans who retire due to permanent partial disabilities rated at 

70 percent or less, but payments are the same as those with partial 

disabilities rated at 80 percent or more because DOD disability retirement 

payments are capped at 75 percent of the individual’s basic pay. 

Disability retirement benefits 

for permanent total disability 

Most of the disability retirement programs for the civilian PSOs we 

reviewed do not offer enhanced disability retirement benefits due to 

permanent total disabilities, but there are some exceptions. For example, 

Florida Highway Patrol Officers may retire on disability only if they are 

unable to perform any gainful employment. Thus, for Florida Highway 

Patrol Officers, disability retirement is itself an enhanced benefit, provided 

only to those with permanent total disabilities. Other examples include 

state police officers in Indiana and Texas, who can receive an enhanced 

disability retirement payments if they have permanent total disabilities: 

100 percent of monthly salary in certain cases of total disability, compared

with 50 percent in most cases of partial disability.41 In addition, disability 

retirement benefits for firefighters in Indianapolis and Los Angeles are 

based in part on the degree of impairment; therefore, those with 

permanent total disabilities may receive higher disability retirement 

benefits than those with partial disabilities. 

 40Federal PSOs must have at least 18 months of service to be eligible for disability 

retirement benefits. See app. II, federal PSOs, for more information. 

41In Indiana, State Police receive disability retirement payments of 100 percent of monthly 

salary when they sustain a catastrophic injury and are unable to perform any gainful work;

otherwise, they receive a disability retirement payment of 70 percent for the first 2 years 

and 50 percent thereafter. In Texas, State Troopers receive disability retirement payments 

of 100 percent of monthly salary when they are incapable of substantial gainful activity due

to an occupational disability that is considered a total disability under federal Social 

Security law; otherwise, they receive a regular disability retirement payment of 50 percent 

if they have less than 20 years of service, and a payment calculated at 2.8 percent of 

average monthly compensation for each year of service if they have 20 years or more of

service. 

Page 38 GAO-06-4 Disability Benefits
The provisions for concurrent receipt of disability compensation and 

disability retirement benefits in cases of permanent total disabilities are 

similar to the provisions in cases of permanent partial disabilities (see 

earlier table 7). As with partial disabilities, most military veterans have 

their DOD disability retirement reduced (offset) dollar-for-dollar by the 

amount of their VA compensation, except those with 20 years or more of 

service. However, as of January 1, 2005, those with a 100 percent disability 

rating were allowed concurrent receipt of both benefits with no offset 

immediately, whereas those with 20 years or more of service and disability 

ratings between 50 and 90 percent are having this offset phased out over a 

10-year period.42 

Concurrent receipt provisions 

for permanent total disability 

On the civilian side, disability compensation programs for federal PSOs, 

Montana Highway Patrol, and Billings Firefighters include provisions that 

specify that total disability benefits—like wage loss benefits—cannot be 

received concurrently with disability retirement benefits. These PSOs 

must choose which type of benefit to receive. Provisions for concurrent 

receipt for Florida Highway Patrol, who must have a total disability to be

eligible to receive disability retirement, are similar to the provisions for 

Miami Firefighters: an offset comes into effect only if the total combined 

benefits exceed the amount of the PSO’s pre-injury salary. 

Civilian PSOs with permanent and total disabilities also may be eligible to

receive a certain lump-sum benefit that is not available to military 

veterans. The Public Safety Officers’ Benefits Program, administered by 

the Bureau of Justice Assistance in the Department of Justice, provides a

lump-sum benefit to PSOs at the federal, state, and local levels who incur 

total permanent disabilities in the line of duty. Qualifying recipients of the 

disability benefit must have a catastrophic injury, defined as the 

consequence of an injury that permanently prevents an individual from 

performing any gainful work.43 The disability benefit program was 

established in 1990 and provides the same cash benefit that a previouslyestablished death benefit program provides to the survivors of public 

safety officers killed in the line of duty. During fiscal year 2005, the benefit 

Public Safety Officers’ Benefits 

Program 

 42Those with 20 years or more of service being compensated at the 100 percent disability 

level due to individual unemployability were initially excluded from this provision; 

however, legislation enacted in 2006 authorizes these veterans to qualify for full concurrent 

receipt with no offset as well, beginning in fiscal year 2010. 

43See app. VIII for comparable definitions of total disability in the other programs we 

examined. 

Page 39 GAO-06-4 Disability Benefits
amount was set at $275,658.44 PSOs can receive these benefits concurrently

with most other benefits with no offset. From October 2002 through June 

2005, the Bureau of Justice Assistance had paid disability benefits to 

41 PSOs nationwide. 

Another benefit that is available to military veterans and federal PSOs with 

permanent total disabilities, and to some of the selected state and local 

PSOs we reviewed, is Social Security Disability Insurance (SSDI).45 SSDI 

benefits are available to individuals who incur a physical or mental 

impairment that prevents them from performing substantial gainful 

activity and that is expected to last at least 1 year or to result in death. The

benefit is based on the employee’s earnings history and lifetime 

contributions to Social Security; therefore the benefit amount varies 

widely among individuals.46 Military veterans and federal PSOs pay into 

Social Security and thus may be eligible to receive SSDI benefits. State and 

local PSOs are eligible to receive SSDI benefits if they contribute to Social 

Security; however, many state and local PSOs do not participate in the

program.47 Of the selected state and local PSOs we reviewed, only Florida 

Highway Patrol and Texas State Troopers pay into Social Security. 

Social Security Disability 

Insurance 

In general, under federal law, public disability benefits, such as workers’ 

compensation and disability retirement provided through a public 

retirement system, cannot exceed 80 percent of the pre-injury wage when

combined with SSDI. When workers’ compensation benefits are received

in addition to SSDI and the combined benefit exceeds 80 percent of the

pre-injury wage, one of the benefits is offset. In most states the Social

Security Administration reduces the SSDI benefit to adhere to the 

80-percent limit, while in 14 states the workers’ compensation benefit may 

be reduced instead of the SSDI benefit. However, when disability 

 44The date of injury determines the benefit amount, which is adjusted annually based on the 

Consumer Price Index. 

45The Social Security Administration does not use the terms “permanent” or “total” in its

definition of eligibility for SSDI benefits. (See app. III for details.) However, most 

individuals who would qualify for SSDI would be considered as having permanent total 

disabilities by most other programs we reviewed.

46The maximum benefit in 2005 was $1,939 per month. Added benefits may also be payable 

to eligible family members. (See app. III, SSDI, for details.) 

47State and local government employees who are members of a public retirement system 

are not required to pay into Social Security. Across all 50 states, 72 percent of state and 

local government employees were covered by Social Security as of 2002.

Page 40 GAO-06-4 Disability Benefits
retirement benefits are received from federal, state, or local government 

employment in which the employee contributed to Social Security, the 

Social Security Administration does not reduce the SSDI benefit to adhere

to the 80-percent limit. Nevertheless, the retirement programs may opt to 

reduce the disability retirement benefit in such cases. 

Among the programs included in our study, we found that military 

veterans may receive SSDI benefits with no reduction to their VA 

compensation and military disability retirement benefits. Federal PSOs, 

however, have their disability retirement payment reduced when receiving 

SSDI benefits.

48 At the state and local level, Florida is 1 of the 14 states 

where workers’ compensation benefits may be reduced for recipients of 

SSDI. According to agency officials in Florida, workers’ compensation 

benefits are reduced by SSDI if total benefits (including workers’ 

compensation, disability retirement, and SSDI) exceed 100 percent of the 

pre-injury average weekly wage. In Texas, the SSDI benefit is reduced for 

those receiving workers’ compensation benefits, but Texas State Troopers

may receive both disability retirement and SSDI benefits concurrently with 

no offset. 

Finally, there are a number of additional benefits that may be available in

cases of permanent total disabilities. One such benefit is additional 

compensation for dependents. For example, military veterans can receive 

an added increment to their VA compensation benefit for each dependent,

and the amount is slightly larger for total disabilities than for partial 

disabilities.49 In 2005, for instance, military veterans with a 100 percent 

disability receive $224 more for a dependent spouse and one child than if 

they were single; in contrast, military veterans with a 90 percent disability 

receive $201 more per month for a dependent spouse and child.50 (Of the 

civilian PSOs we reviewed, federal PSOs and Indiana State Police also 

Additional benefits for 

permanent total disability 

 48In the first year of FERS disability retirement benefits for federal PSOs, FERS reduces the

retirement payment by the full amount of any SSDI payment. In subsequent years, FERS

reduces the disability retirement payment by 60 percent of the SSDI payment.

49The increment for dependents is available only for disabilities rated 30 percent or higher.

50The additional amount changes with the number and type of additional dependents.

Page 41 GAO-06-4 Disability Benefits
receive additional benefits for dependents, but they receive the same 

increment for both permanent partial and permanent total disability.51) 

Another additional benefit is educational assistance. Both military 

veterans and civilian PSOs may receive educational benefits for their 

families in cases of total disability. For veterans, the military offers a 

monthly payment for spouse and dependent education, up to $803 during 

2005. For civilian PSOs, the Public Safety Officers’ Benefits Program also 

offers a need-based educational benefit to spouses and children of 

recipients, up to $803 per month during fiscal year 2005. In addition, 

California and Indiana provide a tuition-free higher education for 

dependents of PSOs with permanent total disabilities. 

Other additional benefits that military veterans with certain types of 

severe disabilities may be eligible for include VA grants up to $50,000 for 

adapting existing housing or purchasing a new home, and grants up to 

$11,000 for modifying a vehicle. Military veterans with a total disability 

rating also are eligible for a waiver of the premium on their life insurance

costs, up to $10,000. Federal PSOs may be entitled to house or vehicle 

modifications in some cases, but fewer of these kinds of benefits are 

specified for the selected state and local civilian PSOs we reviewed. For 

example, in Texas, according to agency officials, the workers’ 

compensation program at the state and local level permits modifications to

housing if a line-of-duty injury requires it. In Montana, by contrast, agency 

officials told us that under state law, housing modifications are not 

covered by workers’ compensation benefits. In most civilian programs we 

reviewed, statutes and program rules did not specify such additional 

benefits. 

 51Federal PSOs’ disability retirement payments are calculated at 75 percent of salary for 

those with dependents, and 66-2/3 percent of salary for those without dependents. Indiana

State Police receive an additional $40 per month per dependent.

Page 42 GAO-06-4 Disability Benefits
When military veterans and civilian PSOs incur injuries that are 

permanently and totally disabling, they may receive monthly disability 

compensation and retirement benefits, and, for civilian PSOs, a lump-sum 

benefit. Our analysis showed that, when veterans with total disabilities are 

receiving the highest VA SMC rates due to the type of their impairment, the 

present value of combined benefits provided over their lifetimes is higher 

than the combined benefits for most civilian PSOs. However, many 

military veterans who are rated as having permanent and total disabilities 

(that is, with a 100 percent disability rating) do not receive SMC. Of 

veterans receiving VA compensation for total disability in 2004, 86 percent 

received payments based on the basic monthly compensation rate and 

14 percent received payments based on a higher SMC rate. When veterans 

are receiving the basic VA compensation for a 100 percent disability rating, 

the amount of benefits received over a lifetime is lower than some of the 

selected civilian PSOs’ benefits due to the additional lump-sum benefit 

available to civilian PSOs and the varying provisions for concurrent 

receipt of benefits. 

Military Veterans with 

Certain Types of 

Impairments Receive 

Greater Benefits for 

Permanent Total Disability 

over a Lifetime than Most 

of the Selected PSOs 

With respect to our hypothetical scenarios, officials administering 

programs for military veterans and PSOs told us that in most 

circumstances, quadriplegia would be considered a permanent total 

disability, and that an individual with this impairment would receive both 

permanent total disability compensation benefits and disability retirement 

benefits. Military officials told us that military veterans with quadriplegia 

would qualify for the highest VA special compensation rate (SMC-R.2--

$6,576 per month in 2005, see earlier table 9) in addition to DOD disability 

retirement benefits. Agency officials in the Department of Justice told us 

that most civilian PSOs in this situation would be eligible for the lump-sum 

benefit under the Public Safety Officers’ Benefits Program. Federal PSOs 

would also be eligible for up to an additional $1,500 per month for 

attendant costs that would be paid directly to the care provider. 

To compare the different benefit streams for quadriplegia available to

military veterans and the selected civilian PSOs, we calculated the present 

value of combined payments that would be provided to individuals over a 

lifetime in five scenarios of varied ages, lengths of service, and salary 

levels. These calculations include the combined amount of disability 

compensation and disability retirement payments, taking into account the 

relevant concurrent receipt and offset provisions, as well as any lump-sum 

Page 43 GAO-06-4 Disability Benefits
payments that may be available.52 For military veterans, we calculated 

benefits with special compensation, and for federal PSOs, we calculated 

benefits with the $1,500 attendant allowance.53 As illustrated in figure 6, 

military veterans with quadriplegia are eligible for SMC, and therefore 

receive a higher present value of combined payments over a lifetime than 

most of the civilian PSOs we reviewed. Only for the hypothetical 

individual age 35, with 12 years of service and a salary of $60,000, do

federal PSOs and selected PSOs in California, Texas, and Houston receive 

more benefits than their military counterparts with the same age, years of

service, and salary level. When incurring a total disability at this point in 

their careers, the present value of military veterans’ benefits dips because 

they would not receive benefits as long as would younger servicemembers, 

and do not have enough years of service to qualify for concurrent receipt 

of benefits with no offset. 

 52We were not able to include SSDI in this analysis of benefits received over a lifetime, due

to the complexity of how SSDI benefits are calculated based on an individual’s entire work

history. Among the civilian PSOs we reviewed, additional SSDI benefits would not likely 

affect the outcome of our analysis. Few participate in Social Security, and if they should 

qualify for SSDI, their SSDI benefits would be offset. However, military personnel 

participate in Social Security, and if they should qualify for SSDI, their SSDI benefits are

not offset. As a result, over a lifetime, military veterans could receive significant additional 

SSDI benefits over and above the disability compensation and retirement benefits 

discussed here. 

53As state and local statutes and program rules for the programs we reviewed do not 

specify whether attendant care benefits are covered and in what amount, we could not

include attendant care benefits for the selected state and local PSOs. 

Page 44 GAO-06-4 Disability Benefits
Figure 6: Comparison of Present Values of Combined Disability Benefits over a 

Lifetime for Quadriplegia and Other Permanent Total Disabilities 

0

200000

400000

600000

800000

1000000

1200000

1400000

1600000

1800000

2000000 Dollars

Source: GAO analysis.

Military veterans with special compensationa

Federal PSOs with attendant allowanceb

Military veterans without special compensationc

Federal PSOs without attendant allowanced

Range of benefits for selected state and local PSOs

salary of $20,000

salary of $40,000

salary of $60,000

salary of $85,000

salary of $85,000

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

Age 55, 32 years of service,

Age 45, 22 years of service,

Age 35, 12 years of service,

Age 25, 6 years of service,

Age 20, 1 year of service,

Note: See app. IV for details on methods and table 12 for more detailed data for the selected state 

and local PSOs.

a

Benefits are calculated using VA’s highest SMC rate ($6,576 in 2005). 

b

Includes $1,500 per month for attendant costs. Benefits are calculated using FECA’s schedule 

awards for loss of use of all four limbs. 

c

Benefits are calculated using VA’s basic compensation rate for a 100% disability rating ($2,299 in 

2005). 

d

Does not include $1,500 per month for attendant costs. Benefits are calculated using FECA total 

disability benefits. 

Page 45 GAO-06-4 Disability Benefits
We also calculated the benefit streams for permanent total disabilities for 

military veterans without special compensation, and for federal PSOs 

without the $1,500 per month allowance for attendant costs. As illustrated 

in figure 6, when military veterans receive the basic VA compensation rate 

for a 100 percent disability rating (set at $2,299 per month in 2005), as 

would be expected, the present value of the combined benefits over a 

lifetime is lower than the present value of benefits for veterans who qualify 

for the higher SMC rates. For the hypothetical veterans with fewer than 

10 years of service, the amount of combined benefits over a lifetime is 

lower by more than half. 

Compared with the benefit packages provided civilian PSOs with 

permanent total disabilities, military veterans receiving payments based on 

the basic VA compensation rate for a 100 percent disability rating would 

receive benefits over a lifetime that are greater than for some of the 

selected PSOs, but less than for others. Five factors account for the higher 

present value of the civilian benefit packages in some cases: 

• The lump-sum benefit that is available only to civilian PSOs. 

• The calculation of compensation payments for PSOs based on salary, 

as opposed to the calculation of VA compensation for military veterans 

based on the degree of injury, which can result in civilian PSOs with 

high salaries receiving higher compensation payments than their 

military counterparts with the same salary for the same injury.54

• The enhanced disability retirement benefits provided for permanent 

total disability for some PSOs, including Indiana State Police, and 

Indianapolis and Los Angeles Firefighters. 

• The 75 percent cap on military disability retirement payments that is 

more restrictive than the caps placed on payments by several of the 

PSOs’ disability retirement programs.55

 54This is the case for a hypothetical civilian PSO age 35, with a salary of $60,000 and 

12 years of service, serving as a state police officer in California, Florida, or New Jersey. 

See app. IV, table 12, for more details. 

55Several of the civilian disability retirement programs we reviewed have no caps on 

payments, or have caps ranging from 80 to 100 percent of pre-injury salary. See table 6 in 

earlier section for details. 

Page 46 GAO-06-4 Disability Benefits
• Provisions allowing the concurrent receipt of disability retirement and 

compensation payments with no offset for some PSOs, but not for their 

military counterparts of the same age and years of service. 

Concurrent receipt provisions are particularly important in determining 

the benefits received over a lifetime. For example, California Highway 

Patrol, Texas State Troopers, and Houston Firefighters all may receive 

both compensation and disability retirement payments concurrently, with 

no offset. The present value of benefits received over a lifetime for these 

three groups is higher than for military veterans who are receiving basic 

VA compensation for a 100 percent disability rating. In addition, Florida 

State Police and Miami Firefighters may receive benefits concurrently with 

no offset up to 100 percent of the pre-injury wage, and this contributes in 

some circumstances to greater benefits for these two groups than for 

military veterans. 

Neither military personnel, nor any of the civilian PSOs we reviewed, 

consistently have more line-of-duty disability benefits available to them in 

all situations. Rather, our analysis illustrates the variation in benefit 

packages across programs, depending on specific program provisions and 

individual circumstances. In some situations, military benefits are greater; 

in other situations, one or more of the selected PSOs’ benefits are greater. 

Provisions that govern continuation of pay and temporary disability 

benefits for servicemembers offer certain advantages. But provisions that 

govern permanent partial disability benefits sometimes result in more 

benefits over a lifetime for military personnel, and at other times for the 

selected civilian PSOs, depending on such factors as the type and degree 

of impairment, and whether the impairment prevents the individual from 

returning to duty. Similarly, provisions that govern permanent total 

disability benefits can result in greater benefits for PSOs in some 

circumstances, and for military veterans in others, such as when veterans 

qualify for special compensation. 

Concluding 

Observations 

The ongoing efforts to assess disability benefits may lead Congress and 

other policymakers to consider modifying disability programs. We are not 

taking a position on how disability benefits should be modified. However, 

we believe that any deliberations on this topic should include an 

examination of how such changes would affect ensuring adequate and 

appropriate benefits for those who serve our country, as well as the longterm fiscal well-being of our nation. 

Page 47 GAO-06-4 Disability Benefits
We provided a draft of this report to the Departments of Defense, Labor, 

Justice, and VA; the Social Security Administration; and the Office of 

Personnel Management. All comments received were technical in nature 

and were incorporated as appropriate. 

Agency Comments 

We are sending copies of this report to relevant congressional committees, 

the Secretary of Defense, the Secretary of Veterans Affairs, and other 

interested parties. The report will also be available on GAO’s Web site at

http://www.gao.gov. If you or your staff have any questions regarding this

report, please contact me at (202) 512-7215. Contact points for our Offices 

of Congressional Relations and Public Affairs may be found on the last 

page of this report. Staff acknowledgments are listed in appendix IX. 

Cristina T. Chaplain 

Acting Director, Education, Workforce, 

 and Income Security Issues 

Page 48 GAO-06-4 Disability Benefits
List of Congressional Committees

The Honorable John Warner 

Chairman 

The Honorable Carl Levin 

Ranking Minority Member 

Committee on Armed Services 

United States Senate 

The Honorable Larry E. Craig 

Chairman 

The Honorable Daniel K. Akaka 

Ranking Minority Member 

Committee on Veterans’ Affairs 

United States Senate 

The Honorable Duncan L. Hunter 

Chairman 

The Honorable Ike Skelton 

Ranking Minority Member 

Committee on Armed Services 

House of Representatives 

The Honorable Steve Buyer 

Chairman 

The Honorable Lane Evans 

Ranking Minority Member 

Committee on Veterans’ Affairs 

House of Representatives 

Page 49 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Program name/

administering 

agency Injuries covered

Temporary disability compensation 

payments Permanent disability compensation payments 

Military personnel

Compensation for 

Service-Connected 

Disability/

Department of 

Veterans Affairs (VA) 

Service-connected injuries 

from active military, naval, 

or air service, during either 

wartime or peacetime.a

Includes personal injury 

suffered or disease 

contracted in the line of 

duty, or aggravation of a 

preexisting injury.b

 

No compensation is paid if 

the disability is a result of 

the veteran’s own willful 

misconduct or abuse of 

alcohol or drugs, or if the 

veteran received a 

dishonorable discharge

from the period of service 

giving rise to the injury. No 

length of service 

requirement, but must be a 

veteran (that is, released 

from military service) to be 

eligible to receive benefits.c

Not applicable. (No distinction is made 

between temporary and permanent 

benefits.) 

VA provides recurring monthly payments that vary 

with the degree of disability and number of 

dependents. Payments are made for the remainder of 

life, as long as the condition persists. 

Payment calculation

• Partial disability: Basic payment amounts 

established annually for disability ratings ranging 

from 10% to 90%. During 2005, amounts ranged 

from $108 to $1,380 per month. 

• Total disability: Defined as those rated at 100%. 

During 2005, payment was set at $2,299 per 

month. 

“Add-ons” to basic payments 

Special monthly compensation (SMC) is provided for 

particularly severe injuries, such as amputations, 

blindness, or other loss of use of organs and 

extremities. 

If the disability rating is 30% or more, a veteran is

entitled to additional compensation for each 

dependent. During 2005, the additional amounts 

ranged from $39-$130 for a spouse, and $26-$88 for 

a child, depending on the level of disability.

If the disability rating is 60% or more, and the veteran 

is unable to secure employment due to serviceconnected disabilties, compensation may be

increased to the 100% rate. 

Payment cap 

During 2005, the maximum monthly payment amount, 

including SMC, was $6,576 for a veteran with multiple 

severe injuries requiring a high level of attendant care 

(not including additional amounts for dependents).

Federal PSOs

Federal Employees 

Compensation Act 

(FECA)/ 

Department of 

Labor, Office of

Workers’

Compensation 

Programs (OWCP) 

Any injury or disease 

arising out of employment. 

However, if an injury arises

from willful misconduct of 

the employee, caused by

the employee’s intention to 

bring about the injury or

death of himself or another, 

or is proximately caused by

the intoxication of the 

injured employee, OWCP 

Recurring payment provided every 28 

days when an employee is not able to 

return to work full time,a

 and the employee 

is not eligible for continuation of pay or is

entitled to temporary total benefits beyond 

the period of continuation of pay.b

An 

attendant allowance, not to exceed $1,500 

per month, is also provided, if an attendant 

is necessary. 

 

No distinction is made between temporary and 

permanent disability. An employee can continue to 

receive the recurring 28-day temporary partial or 

temporary total disability compensation payment (and 

an attendant allowance, if needed) as long as the 

employee continues to experience wage loss or is 

unable to return to work. 

In addition, however, an injured employee may 

receive a “schedule award” for the permanent

impairment of certain members, functions, and 

(continued)

Appendix I: Disability Compensation Benefit 

Programs 

Page 50 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Receipt of other income and benefits 

Tax exemptions Cost-of-living adjustments Post-injury wages Disability retirement payments

VA compensation

benefits are 

federally taxexempt. 

A COLA is not guaranteed, but 

Congress has historically passed 

annual COLAs based on a 

percentage equal to the Social 

Security increase.

Veterans who return to military duty are not 

eligible to receive disability compensation 

payments. However, veterans may receive

non-military earnings in addition to

compensation payments with no restrictions.d

Veterans may receive concurrently military

retirement pay, military disability severance 

pay, and other military separation incentive 

pay; however, such pay will be offset by the 

amount of the compensation payment in 

most cases.e

 

FECA 

compensation 

benefits are 

federally taxexempt. 

A COLA is provided on a yearly 

basis, equal to the change in the 

Consumer Price Index. 

If able to work and have earnings, cannot 

receive total disability compensation 

payments. But can receive earnings in 

addition to partial disability compensation 

payments (based on wage loss), and in 

addition to a schedule award for a permanent

impairment. 

Cannot receive total disability or partial 

disability compensation payments (based on 

wage loss) concurrently with disability

retirement benefit payments. However, can 

receive a schedule award for a permanent 

impairment concurrently with disability

retirement benefits with no offset.

Page 51 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Program name/

administering 

agency Injuries covered

Temporary disability compensation 

payments Permanent disability compensation payments 

(Federal PSOs – continued)

may reject the claim for 

compensation. No length of 

service requirement. 

Payment calculation

• Partial disability (when able to work, 

but at a reduced salary): Payments are 

66-2/3% of the wage loss (that is, the 

difference between part time and full 

time wages) if the employee has no 

dependents, 75% if the employee is 

married or has dependents.

• Total disability (when unable to work): 

Payments are 66-2/3% of the 

employee’s average weekly wage if no 

dependents, 75% if the employee is 

married or has dependents. 

Payment cap 

No injured employee may receive more 

than 75% of the regular GS-15, step 10, 

pay level.c

 

organs of the body such as the eye, arm, or kidney, 

and for serious disfigurement of the head, face, or 

neck. 

Payment calculation for schedule award 

Payments are provided for a specified period of time 

depending on the type and degree of permanent 

impairment of a member, organ, or function. For the 

prescribed period of time, an employee receives 66-

2/3% of his or her average weekly wage if no 

dependents, 75% if married or has dependents. For 

any one loss or loss of use of a member, organ, or

function, 312 weeks is the maximum length of time

benefits may be received. However, in the case of

multiple impairments, benefits can be received for 

each loss and the awards run consecutively, with no

specified limit.

Payment cap 

No injured employee may receive more than 75% of

the regular GS-15, step 10, pay level.c

Selected state and local PSOs

• California State Highway Patrol Officers and City of Los Angeles Firefighters 

Workers’

Compensation 

Program/ 

California 

Department of 

Personnel 

Administration and 

Department of 

Industrial Relations 

Any injury or disease 

arising out of employment. 

The injury may be either 

specific, occurring as the 

result of one incident or 

exposure, or cumulative. 

For various state and local 

safety officers, specific 

injuries are presumed 

compensable. These 

include hernia, pneumonia, 

heart trouble, cancer, 

leukemia, tuberculosis, 

blood-borne infectious 

disease, exposure to a 

biochemical substance, 

meningitis, Lyme disease, 

and lower back 

impairment. The injury 

cannot be intentionally selfinflicted or be caused by

the employee’s use of 

alcohol or unlawful use of 

controlled substance, by

the employee’s initial 

Following the period of continuation of pay,a

temporary disability payments are provided 

on a recurring biweekly basis until: 

• the employee’s condition is determined 

to be permanent and stationary; 

• the employee has received benefits for 2 

years;b

 

• the employee returns (or is medically 

authorized to return) to work full time; or 

• the employee returns to work part time 

and earnings exceed the maximum 

allowable. 

Payment calculation 

• Temporary partial disability (able to 

work part time at current job): Payments 

are 2/3 of the difference between the 

amount of actual earnings and the

maximum allowable amount of average 

weekly earnings ($1,260 in 2005).c

 

• Temporary total disability (unable to 

work at current job): Payments are 2/3 of 

the maximum allowable amount of

average weekly earnings.

 

Once the employee’s condition is determined to be

permanent and stationary, recurring permanent 

disability payments are provided to compensate for a 

diminished future earnings capacity. 

Payment calculations 

• Permanent partial disability: Payments are 2/3 of

the maximum allowable average weekly earnings 

for a set time period ranging from 3 weeks to about

17 years, based on an adjusted disability rating.d

After this set time period has expired, those with an

adjusted disability rating of at least 70%, but less

than 100%, continue to receive payments for the 

remainder of life, calculated at 1.5% of the 

maximum allowable average weekly earnings b for 

each percent of their disability rating over 60%. 

• Permanent total disability: Payments are 2/3 of 

the maximum allowable amount of average weekly 

earningsb

 for the remainder of life. 

Payment caps 

• For partial disability of less than 70%, the maximum 

average weekly earnings to be used in the payment 

calculation in 2005 was $330 (times 2/3 equals 

$220). 

 (continued)

Page 52 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Receipt of other income and benefits 

Tax exemptions Cost-of-living adjustments Post-injury wages Disability retirement payments

 

Workers’

compensation 

benefits are 

federally taxexempt. 

An annual COLA is provided only 

for those receiving permanent

disability life pensions (for ratings

70% and higher) based on the 

percentage increase in the state’s 

average weekly wage.f

Can receive earnings with permanent 

compensation payments, even if receiving 

compensation for total disability. Can receive 

earnings in addition to partial disability

compensation payments with the following 

restrictions: 

• Same employer: Can receive earnings in 

addition to permanent partial disability

benefits, but if in a comparable position, 

then benefits are reduced by 15% after 60 

days.

• Different employer: Can receive earnings 

in addition to permanent partial disability

benefits with no reduction in benefits.g

Can receive concurrently with permanent 

disability compensation benefits with no 

offset. 

Page 53 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Program name/

administering 

agency Injuries covered

Temporary disability compensation 

payments Permanent disability compensation payments 

(California—continued)

aggression in a physical 

altercation, by the 

commission of certain 

specified crimes, or by 

voluntary participation in 

off-duty recreational, 

social, or athletic activities 

for the most part. No 

length of service 

requirement. 

Payment cap 

2/3 of the maximum allowable amount of 

average weekly earnings ($1,260 in 2005—

times 2/3 equals $840 per week).

• For partial disability of 70-99%, the maximum 

average weekly earnings to be used in the 

payment calculation in 2005 was $405 (times 2/3 

equals $270). 

• For total disability, the maximum average weekly

earnings to be used in the payment calculation in 

2005 was $1,260 (times 2/3 equals $840). 

Other benefits 

A supplemental job displacement benefite

 and 

education assistance for dependents may also be

provided under some circumstances. 

• Florida State Highway Patrol Officers and City of Miami Firefighters 

Risk Management’s 

Workers’

Compensation 

Program/ 

Florida Department of 

Financial Services

Any injuries or

occupational diseases

that develop because of 

conditions on the job.a

Tuberculosis, heart 

disease, and 

hypertension are

presumed to be workrelated for members of

the special risk class.b

 No 

compensation is provided 

if the injury is caused by

intoxication, use of nonprescribed drugs, or willful 

intention to kill or injure

another person, or if the 

disease the employee 

suffers from is associated

with fear or dislike of a 

person based on

individual characteristics 

such as race, sex, color, 

or religion. No length of 

service requirement. 

Recurring biweekly temporary disability

payments are provided for up to 2 years, or

until maximum medical improvement is 

reached, at which point a physician must 

assess the amount of permanent 

impairment according to the Florida 

Impairment Ratings Guide.c

 

Payment calculations 

• Temporary partial disability: Payments 

are 80% of the difference between 80% 

of the employee’s pre-injury average 

weekly waged

 and the salary the 

employee is able to earn post-injury. 

• Temporary total disability: Payments 

are 66-2/3% of the employee’s average 

weekly wage. Employees suffering 

particularly serious injuries, such as 

blindness or loss of a limb, receive 

temporary total disability of 80% of 

average weekly wage for up to 6 

months. (After 6 months, payments are 

the same as regular temporary total 

disability benefits.) 

Payment caps 

• Temporary partial disability payment 

cannot be in an amount greater than 66-

2/3% of the pre-injury wage, and is

capped at the statewide average weekly 

wage ($651 in 2005). 

• Temporary total disability payment is

capped at the statewide average weekly 

wage ($651 in 2005). Payments for 

certain more serious injuries have a 

higher weekly cap ($700 in 2005).

Two types of recurring bi-weekly payments are 

available for permanent disability, depending on 

degree of impairment. If eligible for both types of 

benefits, an employee must choose which to receive 

(permanent impairment benefits cannot be received

in conjunction with permanent total disability

benefits). 

Payment calculations 

• Permanent impairment benefits (to compensate

employees for loss of use of a body part or 

function due to an injury): Payments are 75% of 

the employee’s average weekly temporary total 

disability benefits, and are provided for a length of

time ranging from 2 weeks up to 535 weeks, 

depending on the degree of impairment.e

• Permanent total disability (to compensate

employees considered not capable of engaging in 

at least sedentary employment): Payments are

66-2/3% of the employee’s average weekly wage

and are provided for as long as the disability

continues or until 75 years of age.f

 

Payment cap 

Both types of permanent benefits are capped at 

100% of the statewide average weekly wage ($651 

in 2005). 

Page 54 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Receipt of other income and benefits 

Tax exemptions Cost-of-living adjustments Post-injury wages Disability retirement payments

All workers’

compensation 

benefits are 

federally taxexempt. 

A COLA is provided for 

permanent total disability benefits 

in the form of a supplement. The 

supplement equals 3% of the 

weekly compensation benefit 

times the number of calendar 

years since injury. Supplemental 

payments cease at age 62.g

Can receive earnings with temporary partial 

and permanent impairment benefits, but with 

some restrictions. For temporary partial

benefits, earnings are factored into the 

payment calculation (see previous column).h

For permanent impairment benefits, when 

post-injury earnings are equal to or greater

than the pre-injury average weekly wage,

permanent impairment benefits are payable at 

37.5% of the average weekly temporary total 

disability benefits (instead of 75%). 

To receive permanent total compensation, the 

individual must not be capable of engaging in 

at least sedentary employment due to the 

disability.

According to program officials, can receive 

disability retirement benefits concurrently

with workers’ compensation benefits. 

However, with the exception of permanent 

impairment benefits,i

 the compensation 

benefits are offset if the combined total of 

benefits exceeds 100% of the pre-injury 

average weekly wage. 

Page 55 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Program name/

administering 

agency Injuries covered

Temporary disability compensation 

payments Permanent disability compensation payments 

• Indiana State Police and City of Indianapolis Firefighters 

Not applicablea

• Montana State Highway Patrol Officers and City of Billings Firefighters 

Workers’

Compensation/ 

Montana Department of 

Labor and Industry – 

Employment Relations, 

Workers’

Compensation Claims 

Assistance Bureau 

All injuries and illnesses 

sustained during work or 

when performing workrelated activities.

Workers’ compensation 

benefits may be denied to 

those with injuries

resulting from 

intoxication. However, if

an employer had

knowledge of an 

employee’s use of 

intoxicants on the job and 

made “no effort to stop it,” 

the employee still 

qualifies for workers’

compensation benefits. 

No length of service 

requirement, according to 

agency officials. 

A recurring bi-weekly payment provided 

until “maximum healing” is achieved, and/or 

the employee is released to work and is 

able to return to the same employer at an 

equal or higher wage.

a

Payment calculation

• Temporary partial benefits (when able 

to work prior to maximum healing, but at 

a reduced salary): Payments are equal 

to the total loss in wages, up to the 

amount of the worker’s temporary total 

disability benefit rate. Benefits may be 

received for up to 26 weeks, with further 

extensions possible. 

• Temporary total benefits (when unable 

to work): Payments are of 66-2/3% of 

wages at the time of injury. Benefits may 

be received for the duration of healing. 

Payment cap 

State average weekly wage ($520 in 2005).

A recurring bi-weekly payment provided after

“maximum healing” is achieved if the employee 

experiences a wage loss and has a permanent

impairment, or is unable to work due to the injury. 

Payment calculation

• Permanent partial benefits (when able to work 

with a permanent impairment, but at a reduced 

salary): Payment of 66-2/3% of wages at time of

injury are provided for a length of time based on 

a percentage derived from injury, wage loss, and 

other factors,b

 which is then multiplied by 375 

weeks.

• Permanent total benefits (when unable to 

work): Payment of 66-2/3% of wages at the time 

of injury provided for the duration of the 

disability.

c

 

Payment caps 

• 50% of state average weekly wage for partial 

disability payments ($520 in 2005—times 50% 

equals $260 per week). 

• 100% of state average weekly wage for total 

disability payments ($520 in 2005). 

Additional benefits 

Employees with a face, head, or neck disfigurement 

may qualify for a lump-sum benefit of up to $2,500.

• New Jersey State Police and City of Newark Firefighters 

Workers’

Compensation/ 

New Jersey 

Department of Labor 

and Workforce 

Development 

All occupational injuries 

and illnesses arising out 

of and in the course of

employment. In addition, 

for police and firefighters, 

the state statute provides

a rebuttable presumption 

of compensability for all 

cardiovascular and 

cerebrovascular injuries. 

However, work-related 

injuries may not be 

covered if an employee 

was willfully negligent at 

the time of injury. No 

length of service 

requirement. 

Recurring weekly payments are provided 

while an injured employee is temporarily 

unable to work and has not reached 

maximum medical improvement, up to a 

maximum of 400 weeks. a

Payment calculation

• Temporary partial disability: No 

benefits are provided for temporary 

partial disability.

• Temporary total disability: 70% of the 

injured employee’s average weekly

wage, or 75% of the state average 

weekly wage, whichever is less. 

 

Recurring weekly payments for injuries causing any 

degree of permanent disability, either “scheduled” or 

“non-scheduled,” as determined by a physician.b

Payment calculation

• Partial disability (able to return to previous

work): The percentage of employee’s average 

weekly wage and number of weeks payments

are provided are determined based on type and 

degree of impairment. Payments can be 

received for up to a maximum of 600 weeks.c

• Total disability (unable to return to previous 

work): Payments are 70% of employee’s 

average weekly wage for up to 450 weeks. After 

450 weeks, payments continue only if it is 

determined that the employee’s 

(continued)

Page 56 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Receipt of other income and benefits 

Tax exemptions Cost-of-living adjustments Post-injury wages Disability retirement payments

Workers’

compensation 

benefits are 

federally taxexempt. 

For permanent total disability

benefits, there is a COLA after 2 

years, and then annually. The 

adjustment is equal to the 

percentage increase in the state 

average weekly wage. 

• Can receive earnings with temporary partial 

compensation benefits if the benefit and 

the new salary, when combined, do not 

exceed the employee’s pre-injury wage. 

• Can receive earnings with permanent 

partial benefits. 

• Cannot receive earnings while receiving 

either temporary or permanent total 

compensation benefits, unless written 

consent is obtained from the insurer. 

. 

The Montana Workers’ Compensation Act 

does not address receipt of disability

retirement benefits from employer-sponsored 

programs. (See app. II, Montana State 

Highway Patrol Officers and City of Billings

Firefighters, under “Disability compensation 

payments,” for relevant provisions.) 

Workers’

compensation 

benefits are 

federally taxexempt. 

No COLA provided. Rates are 

based on the year of injury and 

remain fixed for the entire period 

of disability.

d

 

Cannot receive earnings with either temporary 

total or permanent total disability payments for

the first 450 weeks. After 450 weeks, can 

receive earnings only in very limited 

circumstances.e Can receive earnings while 

receiving permanent partial disability

payments. 

Can receive concurrently with compensation 

benefits, but the benefits may be offset.f

Page 57 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Program name/

administering 

agency Injuries covered

Temporary disability compensation 

payments Permanent disability compensation payments 

(New Jersey – continued) 

Payment cap

75% of the state’s average weekly wage 

($888 in 2005—times 75% equals $666 per 

week). 

disability precludes performance of any gainful 

employment. 

Payment cap 

75% of the state’s average weekly wage ($888 in 

2005—times 75% equals $666 per week). 

• Texas State Troopers and City of Houston Firefighters 

Workers’

Compensation/ 

Texas Department of 

Insurance, Division of 

Workers’

Compensation 

All work-related injuries 

and illnesses, provided 

that the employer

participates in the 

program. State Troopers 

are covered, and, 

according to City of 

Houston officials, Houston 

Firefighters are also 

covered. Injuries are not 

covered, however, if 

incurred as a result of 

intoxication, intentional 

injury, injury caused by

another person for 

personal reasons, an “act 

of God,” or “horseplay.” 

Following the period of continuation of pay,a

recurring payments are provided to injured 

employees until they attain “maximum 

medical improvement” or for a maximum of 

104 weeks. At 104 weeks, the state 

considers the injury to have achieved a 

statutory “maximum medical improvement.”

Payment calculation

Temporary income benefits are based on

70% of the employee’s loss in wages, 

calculated by subtracting the employee’s 

weekly earnings after the injury from the 

employee’s average weekly wage before 

the injury.

b

 For employees making less than 

$8.50 per hour, the payments are based on

75% of the employee’s loss in wages for up 

to 26 weeks, then drops to 70%. 

Payment cap 

100% of statewide average weekly wage 

($539 per week in 2005).

Upon reaching maximum medical improvement, three 

types of permanent disability benefits are available. 

Payment calculations 

• Impairment Income Benefits: Payments are 70% 

of the employee’s average weekly wage, and are 

received for a length of time determined by the 

degree of impairment. An employee receives 3 

weeks of benefits for each percentage point of 

impairment. 

• Supplemental Income Benefits: Payments begin 

upon expiration of impairment income benefits if an 

employee meets certain criteria, such as having an

impairment rating of at least 15% and earning less 

than 80% of the pre-injury wage. Payments are

80% of the employee’s loss in wages, calculated by

subtracting the employee’s weekly earnings after 

the injury from the employee’s average weekly preinjury wage. An employee can receive this benefit 

until reaching a cumulative total of 401 weeks of 

temporary, impairment, and supplemental workers’

compensation benefits. 

• Lifetime Income Benefits: Payments provided for 

certain types of extreme injuries such as

dismemberment, severe burn, or brain trauma. 

Payments are 75% of the employee’s average 

weekly wage, and are increased 3% annually. 

These payments are provided for the remainder of 

life. 

Payment caps 

• Impairment and supplemental income benefits are

capped at 70% of the statewide average weekly 

wage ($539 in 2005—times 70% equals $377 per 

week). 

• Lifetime income benefits are capped at 100% of the 

statewide average weekly wage ($539 per week in 

2005).

Page 58 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Receipt of other income and benefits 

Tax exemptions Cost-of-living adjustments Post-injury wages Disability retirement payments

Workers’

compensation 

benefits are 

federally taxexempt. 

A COLA of 3% per year is 

provided only for those receiving 

lifetime income benefits.c

• Can receive earnings with impairment and 

supplemental income benefits. Earnings 

are one of the factors considered in the 

determination of the benefit amount. 

• No restrictions on earnings are specified 

with respect to lifetime income benefits. 

According to program officials, can receive 

concurrently with compensation benefits with 

no offset. 

Source: GAO analysis based on statutes, regulations, program policies, and interviews with program officials. 

Page 59 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Military personnel

a

Groups considered to be covered in this definition include Coast Guard and Public Health Officers,

among others. 

b

An alternative program, VA Disability Pension, is available for veterans of wartime service with lowincomes, and permanent and total disabilities, but whose disabilities are not service-connected. 

Payments under this program generally are lower than the compensation payable for serviceconnected disabilities. Veterans cannot receive benefits from both programs simultaneously. 

c

Veterans may be eligible for benefits if released from service only on a temporary basis, as when 

receiving temporary disability retirement benefits. See app. II, military personnel, for more details. 

d

Except when the veteran’s compensation is based on an inability to secure employment due to a 

service-connected disability. In such cases, earnings may suggest a return to employment and might 

result in a reduction in the compensation payment. 

e

See app. II, military personnel, for exceptions to the offset requirements.

Federal PSOs

a

There may be deviations from the 28-day cycle in certain circumstances. 

b

When totally disabled due to a traumatic injury, an injured employee may receive continuation of pay 

for a period of up to 45 calendar days. OWCP considers continuation of pay to be regular pay, not 

workers’ compensation, and the salary is subject to the usual taxes and payroll deductions. 

Continuation of pay can run consecutively or intermittently. 

c

Currently, the GS-15, step 10, pay level is $116,517. This maximum does not apply to any employee

whose disability is a result of an assault that occurs during an assassination or attempted 

assassination of a federal official. 

Selected state and local PSOs

California

a

State and local safety workers injured in the line of duty are entitled, regardless of length of service, 

to 1 year’s leave of absence without loss of salary, tax-exempt. 

b

For most injuries, receipt of temporary disability benefits is limited to 104 weeks (2 years). However, 

benefit receipt can be extended for up to 240 weeks over 5 years for hepatitis, amputations, severe 

burns, HIV, high velocity eye injuries, chemical burns to the eyes, pulmonary fibrosis, and chronic 

lung disease. 

c

For state and local safety workers, the maximum allowable amount of average weekly earnings is

always used in the calculation, regardless of actual earnings. For other non-safety workers, the 

calculation is based on the employee’s average weekly earnings prior to injury (up to the maximum). 

d

The disability rating is based on the nature of the physical injury or disfigurement, then adjusted 

based on the employee’s occupation, age at time of injury, and diminished future earning capacity. 

e

Vocational rehabilitation services were eliminated effective January 1, 2004, and replaced with this

job displacement benefit, which provides a voucher for training ranging from $4,000 to $10,000 based

on the employee’s level of injury. 

Page 60 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

f

The temporary disability payment rate is adjusted periodically by the state legislature to reflect salary

increases. Beginning January1, 2006, the maximum temporary disability payment rate will be 

adjusted annually to reflect the percentage increase in the state average weekly wage (or remain at 

$1,260, whichever is greater). However, an individual’s payment, once determined, generally does 

not change. An employee must receive temporary disability benefits for 2 years before being eligible 

to have their payment adjusted; therefore, only those qualifying for extended benefits (see endnote a

above) would be eligible for such an increase. Similarly, an individual’s permanent disability payment,

once determined, does not change, except for life pensions. 

g

If no offer of comparable work from previous employer, benefits are increased 15% after 60 days. 

Florida

a

Law enforcement officials are covered if they are discharging duties under the aegis of the state and 

in circumstances consistent with their responsibilities.

b

Members of the special risk class include certain law enforcement officers, firefighters, and 

correctional officers. 

c

Certain law enforcement officers, including Highway Patrol Officers, are eligible to continue in full-pay 

status if they sustain a malicious injury caused by another person. According to officials, officers are 

eligible to receive full pay for up to 2 years. There are also provisions for disability leave with full pay, 

at the employer’s discretion. Under their collective bargaining agreement, Miami Firefighters can 

receive continuation of pay for up to 210 days, depending on the seriousness of the injuries. The

clock on these benefits runs concurrently with workers’ compensation temporary disability benefits.

d

Average weekly wage is calculated based on the 13 weeks prior to the injury. 

e

Benefits are provided according to the following schedule: 2 weeks for each percentage point of 

disability from 1 to 10%; 3 weeks for each percentage point of disability from 11 to 15%; 4 weeks for

each percentage point of disability from 16 to 20% and 6 weeks for each percentage point of disability 

from 21% and higher. According to agency officials, most employees would not receive benefits for 

the maximum length of time. (This schedule is established separately by the state of Florida, and 

incorporates, but expands upon, the AMA Guides.)

f

The supplements cease unless the employee is not eligible for Social Security benefits (in which case

the supplements continue), or unless the injury occurred after the age of 70 (in which case benefits 

are payable for a maximum of 5 years after the determination of permanent total disability). Florida 

State Highway Patrol Officers pay into Social Security, while Miami Firefighters do not. 

g

Permanent total disability supplements together with permanent total disability may not exceed the 

statewide average weekly wage. 

h

For each week that the employee earns income equal to or greater than his or her average weekly 

wage, permanent impairment benefits are payable at 37.5% of the average weekly temporary total 

disability benefits. 

i

There is no offset with permanent impairment benefits. 

Indiana

a

In Indiana, state statutes allow some public employers to opt out of the state’s workers’ 

compensation program, and we found that both the Indiana State Police and the Indianapolis Fire 

Department had opted to provide disability benefits only from their pension funds.

Page 61 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Montana

a

Montana Highway Patrol Officers and Billings Firefighters have continuation of pay for up to 1 year. 

An official told us this policy was flexible with respect to Highway Patrol Officers and that extensions

can be granted. The clock on these benefits runs concurrently with workers’ compensation temporary 

disability benefits. 

b

Age, education, and manual versus sedentary labor are the other factors. 

c

Or until eligible for either Social Security retirement benefits or benefits from an alternative system to

Social Security. However, Montana Highway Patrol Officers and Billings Firefighters do not pay into 

Social Security, and program officials advised us that there is no case law defining an alternative to

Social Security. 

New Jersey

a

According to officials from the New Jersey State Police, Division of Human Resource, and the 

Newark Fire Department, there is no provision for continuation of pay for State Police Officers or 

Newark Firefighters. However, State Police Officers may take sick leave until they are able to return 

to duty or retire, generally for a maximum of 1 year, but longer if it appears they will be able to return 

to duty with more time. Newark Firefighters may take up to a year of sick leave for any injury (either 

work-related or non-work-related) that prevents them from working. 

b

A "scheduled" loss is one involving arms, hands, fingers, legs, feet, toes, eyes, ears, or teeth. A 

"non-scheduled" loss is one involving any area or system of the body not specifically identified in the 

schedule, such as the back, the heart, or the lungs. 

c

An additional amount of 30% of the award is added as a lump-sum payment for individuals with an 

amputation of a body member. 

d

However, workers whose total disabilities occurred prior to 1980 are entitled to a special adjustment. 

e

If an injured employee participates in physical or educational rehabilitation as ordered, and can show

that because of the disability it is impossible to obtain wages or earnings equal to those earned at the 

time of the accident, further weekly payments can be made, minus the amount the employee is able 

to earn compared with the wages received at the time of injury. If the employee’s wages or earnings 

equal or exceed wages received at the time of injury, then the compensation rate is reduced to $5.00.

f

According to a program officials, if a government worker in New Jersey has an accidental disability

pension (that is, covering only work-related injuries), the pension plan would take the offset. If the 

government worker has an ordinary disability pension (that is, covering non-work-related injuries), 

workers’ compensation would take the offset. However, the additional lump-sum amount for 

amputation of a body member is not subject to offsets. 

Texas

a

Effective June 17, 2005, a new state law (HB 1428) allows law enforcement officers, including State 

Troopers, injured in the line of duty as a result of an “assaultive” offense to receive up to 1 year of 

leave without a reduction in salary before collecting workers’ compensation benefits. Municipal 

firefighters injured in the line of duty can receive full pay for 1 year, with an extension at the discretion

of the local governing body. According to officials, the Houston City Council can extend this leave up 

to 2 years in total, with proper medical documentation and a clear expectation of the firefighter 

returning to work. 

b

The average weekly wage equals 13 weeks’ pre-injury salary divided by 13. 

c

According to officials, benefit levels are set according to the law in effect at the date of injury, and 

historically do not change for those already receiving benefits at the time of a change in the law, 

except for those receiving lifetime income benefits.

Page 62 GAO-06-4 Disability Benefits
Appendix I: Disability Compensation Benefit 

Programs 

Page 63 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits Appendix II: Disability Retirement Benefits Programs 

Programs 

Program name/ 

administering

agency Injuries covered Disability retirement payments Tax exemptions

Military personnel 

Disability Retirement 

and Disability

Severance Pay/

Department of 

Defense (DOD) 

Injuries covered are those 

which: 

• are incurred or aggravated 

while member is entitled to 

basic pay; 

• are incurred in line of duty 

while member is on active 

duty; and 

• are or may be permanent.a

Injury cannot be the result of 

intentional misconduct or willful 

neglect, and not incurred 

during a period of unauthorized 

absence.b

 

Length of service requirements 

vary for different types of 

benefits. 

Recurring monthly payment available for servicemembers who 

are found unfit for duty, and who have either 20 years of service 

or have a disability rated at least 30%.c

Payment calculation

Basic pay

d

 times the greater of either: 

• the percentage of disability or 

• 2.5% times the number of years of service. 

Payment cap 

Cannot exceed 75% of basic pay, regardless of calculation 

method. 

Military disability retirement 

benefits are taxable, with 

some exceptions. A portion 

of disability retirement pay

still may be tax-exempt 

under the following 

conditions:c

1 – If the member’s 

disabilities are combatrelated. 

2 – Alternatively, if the 

member was entitled to 

receive a disability

payment before September 

24, 1975; or on active duty, 

a member of a reserve 

component, or under a 

binding written commitment 

to be a member on 

September 25, 1975. 

Federal PSOs 

Federal Employees’ 

Retirement System

(FERS)/ 

Office of Personnel 

Management 

Any disease or injury, 

occupational and nonoccupational, causing a civilian 

federal employeea

 to become 

unable to perform useful and 

efficient service in their 

position.b

 Employees must 

have at least 18 months of 

creditable service to qualify. 

A recurring monthly payment is provided. 

Payment calculation

If not yet eligible for normal retirement, disability retirement 

payments are calculated as follows: 

• During the first year, disability retirement payments are 60% 

of the average high-3 salary,c

 minus 100% of any Social 

Security disability benefits to which entitled (but not less than 

the normal retirement benefit based on age and length of 

service). 

• During the second and subsequent years of disability until 

reaching age 62, payments are 40% of the average high-3 

salary, minus 60% of any Social Security disability benefits to 

which entitled (but not less than the normal retirement benefit 

based on age and length of service). 

• Once reaching age 62 disability retirement payments are 

calculated based on the formula for normal retirement 

benefits: 

• If less than 20 years of service, including time on disability:

1.0% times high-3 average salary times years and months 

of service. 

FERS benefits are 

federally taxable.

(continued)

Page 64 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Receipt of other income and benefits 

Cost-of-living 

adjustments Post-injury wages Disability compensation payments 

COLAs are provided 

annually, based on 

the increase in the 

Consumer Price 

Index. 

Cannot receive with military earnings, most foreign 

government employment, or federal judgeships. Can 

receive with most other public and private employment. 

Can receive concurrently with VA service-connected disability

compensation, with offset.f

 Exceptions to the offset are made for 

the following special groups: 

1 - For those with a disability rating of 50% or more, and who 

either were retired for length of service,

g

 or retired for disability

but with a length of service retirement entitlement (that is, with 20 

years or more of service), the offset is being phased out.h

 

2 - For those with a disability rating of 100% and length of service 

retirement entitlement (that is, with 20 years or more of service), 

there is no offset).i

3 - Alternatively, retired servicemembers with combat-related 

injuries and 20 years or more of service may be eligible to receive 

a special benefit equal to the amount of the offset, tax-exempt.j 

FERS benefits are 

adjusted annually for 

cost of living based on 

the Consumer Price 

Index, generally 

beginning after the 

first year of 

entitlement.e

Can receive earnings in addition to FERS disability 

retirement benefits if age 60 or over, or if under age 60 and 

earnings are less than 80% of the current basic rate of pay 

for the previous position.f

Cannot receive concurrently with total or partial disability

compensation benefits based on wage loss. However, can 

receive concurrently with a schedule award, with no offset. 

Page 65 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Program name/

administering 

agency Injuries covered Disability retirement payments Tax exemptions

(Federal PSOs – continued)

• If 20 years of service or more, including time on disability:

1.1% times high-3 average salary times years and months 

of service. 

In addition to counting years on disability as years of service, 

a new high-3 average salary is calculated taking into account 

salary increases based on COLAs during the period of time 

receiving disability.

If eligible for normal retirement under the special rules that apply

to most federal PSOs—that is, age 50 with 20 years of service, 

or at any age with 25 years of service—then disability retirement 

payments are calculated using a different formula, as follows: 

• 1.7% of the average high-3 salary times years of service up 

to 20, plus 1.0% of the average high-3 salary times years of 

service exceeding 20.d

Payment cap 

None specified. 

Selected state PSOs 

• California State Highway Patrol Officers 

Industrial Disability

Retirementa

/ 

California Public 

Employees’ 

Retirement System 

A work-related illness or injury

that is of a permanent or 

extended and uncertain 

duration, and that prevents the 

officer from performing his or 

her job for the current 

employer or any other 

employer under the same 

retirement system. Highway 

Patrol Officers can qualify for 

industrial disability retirement 

regardless of age or length of 

service.b

A monthly industrial disability retirement payment is paid for the 

remainder of life (or until the employee recovers and returns to 

work). 

Payment calculation

• For those not yet eligible for normal retirement based on age 

and length of service (age 50 with at least 5 years of service 

for Highway Patrol Officers), industrial disability retirement 

payments are generally 50% of final compensation. 

• For those eligible for normal retirement, industrial disability

retirement payments are calculated based on the formula for 

normal retirement: for Highway Patrol Officers, this formula is 

3% of final compensation for each year of service. 

Payment cap 

90% of final compensation. 

According to program

officials, the amount of 

payment based on the first 

50% of final compensation 

is treated as federally taxexempt. Any additional 

amount received based on

years of service is treated 

as federally taxable.

• Florida State Highway Patrol Officers 

Florida Retirement 

System/ 

Florida Department of 

Management 

Services, Division of 

Retirement 

Any illness or injury causing 

total and permanent disability

that arises out of the 

performance of job duties. 

Must have total and permanent 

disabilities that prevent any

useful and efficient service as 

an officer or employee. 

Recurring monthly payment provided for the remainder of life. 

Payment calculation

Payments are 65% of average final compensation,b

 or normal 

retirement benefits (based on age and length of service), if 

greater. The formula for normal retirement benefits is 3% of 

average final compensation for each year of special risk 

service.c

According to state officials, 

the disability portion of a 

disability retirement 

pension is treated as 

federally tax-exempt (that 

is, 65% of average final 

compensation is treated as

tax-exempt). If 

(continued)

Page 66 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Receipt of other income and benefits Cost-of-living 

adjustments Post-injury wages Disability compensation payments 

COLAs are based on 

the Consumer Price 

Index for all United 

States cities, up to a 

maximum of 2% per 

year. The adjustments 

are paid the second 

calendar year of 

retirement, then every 

year thereafter. 

Cannot receive earnings with industrial disability retirement 

payments if the individual continues to work in a position 

similar to the one from which retired on disability.

Otherwise, can receive earnings with such payments up to

a combined amount that is 100% of the maximum earnable 

compensation of the pre-injury position. If earnings, plus 

the industrial disability retirement payment, exceed the 

maximum earnable compensation level, then the 

retirement payment will be reduced to stay within the 100% 

earnings limitation.c

Can receive concurrently with industrial disability retirement 

payments with no offset. 

An annual COLA of 

3% is provided, prorated for the first year 

of benefit receipt.

Cannot receive substantial earnings with disability

retirement benefits, as recipients cannot be gainfully 

employed by any employer. 

According to program officials, workers’ compensation payments 

can be received concurrently with disability retirement payments, 

but the workers’ compensation benefit is offset if combined 

benefits exceed 100% of the employee’s pre-injury average 

weekly wage. 

Page 67 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Program name/

administering 

agency Injuries covered Disability retirement payments Tax exemptions

(Florida – continued) 

Tuberculosis, heart disease, 

hypertension, hepatitis, or 

meningococcal meningitis are 

presumed to be incurred in the 

line-of-duty.a

 No length of 

service requirement. 

Payment cap 

100% of pre-injury average weekly wage. 

payments are greater 

based on the normal 

retirement formula, the 

added portion is treated as

federally taxable.

• Indiana State Police Officers 

Police Benefit Fund, 

Supplemental Trust 

Agreement of 1987a

/ 

Indiana State Police 

Department, Pension 

Advisory Board 

Any injury incurred by a State 

Police Officer while in the 

performance of duty that 

results in disability. No length 

of service requirement. 

Recurring monthly payments are provided until the disability no 

longer exists, death occurs, retirement occurs, or the later of the 

date the officer is credited with 25 years of service or the date 

the officer has received all available sick leave benefits and 

long-term disability insurance payments (but not to exceed 2 

such years).

Payment calculation 

• Unable to return to duty: Payments are 70% (50% provided 

by the supplemental trust plus 20% provided by insurance 

coverage) of the officer’s average high-3 salary for the first 2 

years of disability beyond 365 days of sick pay.

b

 After the first 

2 years at 70%, officers receive 50% of their average high-3 

salary. 

• Unable to perform any gainful work (permanent total 

disability by catastrophic injury): Payments are 100% of the 

officer’s salary at the time of injury. 

For both categories, an extra $40 is provided for each 

dependent parent and child under 18 years of age.c

After 25 years of service including years receiving disability

retirement, benefits are recalculated as normal service 

retirement benefits at 50% of average salary. d

Payment cap 

Disability payments may not exceed the officer’s basic monthly

retirement payment at normal retirement age.e

According to a program 

manager, disability

retirement benefits are

treated as federally taxexempt. 

• Montana State Highway Patrol Officers 

Highway Patrol 

Officers’ Retirement 

System/ 

State of Montana, 

Public Employees’ 

Retirement Board 

Line-of-duty injuries that 

prevent an officer from 

performing police duties. No 

length of service requirement. 

A recurring monthly payment is provided. 

Payment calculation

An employee with less than 20 years of service credit receives 

50% of the highest 36-month average compensation. 

An employee with 20 or more years of service receives 2.5% of 

highest 36-month average compensation for each year of 

service.

Payment cap 

None specified. 

Board officials told us that

disability retirement 

benefits are treated as 

federally taxable.

Page 68 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Receipt of other income and benefits Cost-of-living 

adjustments Post-injury wages Disability compensation payments 

The benefit is 

recomputed annually 

based on the prior 36 

months average 

monthly salary as of 

the beginning of each 

fiscal year for the

officer’s pre-injury

position, as if the

officer were still on the 

force. 

According to a program manager, officers can receive 

earnings while receiving disability retirement benefits

provided that their new work activities are not similar to 

those unable to be performed as a State Police Officer and 

that all applicable department rules are followed. 

Not applicable. State Police Officers do not receive recurring 

cash payments from the state workers’ compensation program. 

A guaranteed annual 

benefit adjustment of 

3% is provided each 

year. 

Can receive earnings if from a job outside of law 

enforcement. 

Cannot receive disability retirement benefits concurrently with 

compensation benefits except for a permanent partial benefit 

award based on a permanent impairment. 

Page 69 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Program name/

administering 

agency Injuries covered Disability retirement payments Tax exemptions

• New Jersey State Police Officers 

State Police 

Retirement System/ 

New Jersey Treasury 

Department, Division 

of Pension and 

Benefits 

Accidental disability benefits

are provided for traumatic 

injuries sustained as a direct 

result of an officer’s duties,

causing mental or physical 

incapacitation for the 

performance of the usual 

duties of a police officer.a

 To 

qualify as a traumatic injury, 

the injury must not be caused 

by the officer, must not be

induced by normal work efforts, 

and must have a violent or 

uncontrollable source. The 

injury is not covered if an 

officer is willfully negligent in 

causing the disabling injury. No 

length of service requirement. 

A recurring monthly payment is provided. 

Payment calculation

Payments are equal to 2/3 of final compensation. 

Payment cap

None specified. 

Accidental disability

benefits are treated as 

federally tax-exempt. 

According to a program 

official, the benefits also 

are treated as exempt from 

state taxes until the officer 

reaches age 65, at which 

point the benefits are 

treated as taxable the 

same as normal retirement 

benefits. 

• Texas State Troopers 

Occupational 

Disability Retirement 

Program/ 

Employees 

Retirement System of 

Texas 

Any career-ending injury or 

illness sustained by a state law 

enforcement officer while 

performing duties specifically 

related to law enforcement. No 

length of service requirement. 

A monthly annuity is provided for the life of the officer, unless 

the officer either returns to work or is found to be no longer 

incapacitated. 

Payment calculation

• Less than 20 years of service: Payments are equal to the 

officer’s average monthly compensation for the highest 36 

months of service, multiplied by 50%. 

• 20 or more years of service: Payments are equal to the 

officer’s average monthly compensation for the highest 36 

months of service, multiplied by 2.8% for each year of service 

credit. 

• Incapable of substantial gainful activity (due to an 

occupational disability that is considered a total disability

under federal Social Security law): Payments are increased 

to 100% of the officer's average monthly compensation. 

Payment cap

Benefits may not total more than 100% of the employee’s 

average monthly compensation. 

According to program

officials, benefits are 

treated as federally 

taxable. 

Page 70 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Receipt of other income and benefits Cost-of-living 

adjustments Post-injury wages Disability compensation payments 

A COLA is added to 

benefits in the 25th

month after the date 

the employee’s 

retirement, and then 

with the first benefit 

issued each February 

after that.b 

Can receive earnings from a new job not covered by the 

State Police Retirement System. Also, if a member proves

that the disability no longer exists, or no longer prevents a 

return to duty as a police officer, the member may be reemployed and re-enrolled in the retirement system.

Can receive concurrently with accidental disability retirement 

benefits, but the retirement benefit is offset dollar-for-dollar for 

any recurring workers’ compensation benefits received.c

According to program

officials, cost-of-living 

increases are not

automatic, but can be 

granted by the state 

legislature on an ad 

hoc basis.a

Can receive earnings with disability retirement benefits, but 

only if the new position does not provide comparable pay 

to the pre-injury position, and the state determines that the 

officer is unable to hold a position offering comparable pay 

as a result of the injury.b 

According to program officials, can receive all workers’

compensation benefits and disability retirement benefits

concurrently with no offset. 

Page 71 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Program name/

administering 

agency Injuries covered Disability retirement payments Tax exemptions

Selected local PSOs 

• California: City of Los Angeles Firefighters 

Service-Connected 

Disabilitya

/ 

Los Angeles

Department of Fire 

and Police Pensions 

The injury must leave the

firefighter incapable of 

performing the duties of a 

sworn employee of the Fire 

Department, including light or 

restricted duties, and be 

caused by the firefighter’s 

duties. No length of service 

requirement. 

A recurring monthly retirement payment is provided.

b

 

Payment calculation

Payments range from 30% to 90% of the employee’s final 

compensation depending on the level of disability, but can be no 

less than 2% for each year of service (for example, an employee 

with 25 years of service can receive no less than a 50% 

disability payment).

c

Payment cap

90% of the employee’s final average salary. 

The portion of the disability

payment that is based on 

the disability rating is taxexempt. Any portion based 

on years of service is

subject to taxation. 

• Florida: City of Miami Firefighters 

Accidental/ServiceIncurred Disability

Retirementa

/ 

City of Miami Fire

Fighters’ and Police 

Officers’ Retirement 

Trust 

Disabling injury as a result of 

an accident occurring on the 

job, or as a result of heart 

disease, hypertension or 

tuberculosis. Employee must 

be less than 60 years of age to 

be eligible, and must be 

permanently incapacitated so 

that unable to return to duty. 

No length of service 

requirement. 

A recurring monthly payment is provided. 

Payment calculation

Payments are 2/3 of final compensation, or average final 

compensation, whichever is greater.b

 

Payment cap 

None specified. 

According to program

officials, benefits are 

treated as federally taxexempt. 

• Indiana: City of Indianapolis Firefighters 

1977 Police Officers’ 

and Firefighters 

Pension and Disability

Fund/ 

Public Employees’ 

Retirement Fund of 

Indiana 

Any impairment that prevents 

police officers or firefighters 

from permanently or 

temporarily performing their 

normal duties, or their normal 

duties with reasonable 

accommodation. No length of 

service requirement. 

Recurring monthly payments are provided for two classes of

duty-related disability benefits. 

Payment calculations 

• Class 1 benefits: Injuries sustained while on duty, while off 

duty though responding to an incident as if on duty, or an 

occupational disease.a

 Payments range from 55 to 90% of 

base salary,b

 depending on the degree of impairment. 

• Class 2 benefits: A duty-related diseasec arising directly out 

of employment.d

Payments are 22% of base salary, plus 

0.5% times the number of years of service up to 30 years, 

plus an additional amount of 10 to 45% based on the degree 

of impairment. 

• Recalculation at age 52: When employees reach age 52, 

both Class 1 and Class 2 benefits are recalculated based on

the formula for normal service retirement: 50% of base 

salary, plus 1% for each 6 months of active service over a 

20-year period. Calculation is based on the greater of either 

Based on a private letter 

ruling from the Internal 

Revenue Service, benefits 

are treated as federally taxexempt until age 55, at 

which time the disability

benefits are considered 

taxable normal service 

retirement benefits. 

(continued)

Page 72 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Receipt of other income and benefits Cost-of-living 

adjustments Post-injury wages Disability compensation payments 

A COLA is provided 

yearly based on the 

Consumer Price Index. 

The adjustment can be 

either a decrease or an 

increase, up to a 

maximum of 3%.

Can receive outside earnings with no statutory 

restrictions. According to city officials, pensioners are 

permitted to hold other jobs and earn income as long as 

they are not violating the restrictions of their disability

(that is, engaging in physical activities that their disability

retirement claim indicated that they could not do). 

Cannot receive concurrently with disability retirement benefits.

Moreover, a firefighter who is granted disability retirement after

receiving workers’ compensation benefits must repay all the 

workers’ compensation cash benefits received to date.d 

A COLA is provided for 

disability retirees age 

50 years or older. The 

amount of the COLA is 

determined by the 

difference between 

projected and actual 

earnings of the Trust, 

and the retiree’s years 

of service and years 

retired. 

Can receive earnings from alternative employment while 

receiving disability retirement benefits.

c

Can receive compensation benefits concurrently with retirement 

benefits, with offset if the combined benefit amount exceeds 

100% of the pre-injury average wage. 

Benefits may be 

increased or decreased

in accordance with the 

Consumer Price Index, 

capped at 3%. 

According to program officials, firefighters on disability

may receive earnings from other employment, as long as 

it is not associated with an accommodation or light duty 

with the same employer. 

Not applicable. Firefighters in Indianapolis do not receive 

recurring cash payments from the state’s workers’ compensation 

program. 

Page 73 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Program name/

administering 

agency Injuries covered Disability retirement payments Tax exemptions

(Indianapolis – cont’d) 

normal service retirement with 20 years of service, or service 

retirement with the total number of years from start of 

employment to age 52.

Payment caps 

• Class 1: 90% of a first-class firefighter’s monthly salary. 

• Class 2: 82% of a first-class firefighter’s monthly salary. 

• Recalculation at age 52: 74% of base salary. 

• Montana: City of Billings Firefighters 

Firefighters’ Unified 

Retirement System/ 

State of Montana

Public Employees’ 

Retirement Board 

Any disability that occurs while 

the employee is in a position 

covered under the Firefighters’ 

Unified Retirement System and 

that causes the termination of 

service. The disability does not 

have to be work-related. 

Periodic reviews are conducted 

by the Board to determine 

whether the employee still 

qualifies for disability

retirement. No length of service 

requirement. 

A recurring monthly payment is provided. 

Payment calculation

An employee with less than 20 years of service credit receives 

50% of the highest 36-month average compensation. 

An employee with 20 or more years of service receives 2.5% of 

the highest 36-month average compensation for each year of 

service. 

Payment cap

None specified. 

Board officials told us that

disability retirement 

benefits are treated as 

federally taxable.

• New Jersey: City of Newark Firefighters 

Police and Firemen’s 

Retirement System/ 

New Jersey 

Department of the 

Treasury, Division of 

Pensions and Benefits 

Accidental disability benefits

are provided for traumatic 

injuries sustained as a direct 

result of a firefighter’s duties,a

causing total permanent 

inability to perform the 

functions of a firefighter.b

 To 

qualify as a traumatic injury, 

the injury must not be caused 

by the firefighter, must not be 

induced by normal work efforts, 

and must have a violent or 

uncontrollable power. No 

length of service requirement. 

A recurring monthly payment is provided. 

Payment calculation

Payments are 2/3 of the firefighter’s salary at the time of the 

traumatic injury or at the time of retirement, whichever is

greater. 

Payment cap 

None specified. 

According to program

officials, accidental 

disability retirement 

benefits are treated as 

exempt from state taxes 

until the firefighter reaches 

age 65, at which point the 

benefits are treated as 

taxable the same as 

normal retirement benefits. 

With respect to federal 

taxability, recipients are 

directed to contact the 

Internal Revenue Service. 

Page 74 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Receipt of other income and benefits 

Cost-of-living 

adjustments Post-injury wages Disability compensation payments 

A guaranteed annual 

benefit adjustment of 

3% is provided each 

year. 

Can receive earnings from a new position outside of the 

retirement system with no restrictions. However, 

according to city officials, employees who are hired back 

into a city position where they are covered by the same 

retirement system may work no more than 960 hours per 

year. 

Cannot receive disability retirement benefits concurrently with 

compensation benefits except for a permanent partial benefit 

award based on a permanent impairment. 

A COLA is added to 

benefits in the 25th

month after the date 

the employee’s 

retirement, and then 

with the first benefit 

issued each February 

after that.c

Can receive earnings from a new job not covered by the 

Police and Firemen’s Retirement System. Also, if a 

member proves that the disability no longer exists, or no 

longer prevents a return to duty as a firefighter, the 

member may be re-employed and re-enrolled in the 

retirement system. 

Can receive concurrently with accidental disability retirement 

benefits, but the retirement benefit is offset dollar-for-dollar for 

any recurring workers’ compensation benefits received.d 

Page 75 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Program name/

administering 

agency Injuries covered Disability retirement payments Tax exemptions

• Texas: City of Houston Firefighters 

On-Duty Disability

Retirement/ 

Houston Firefighters’ 

Relief and Retirement 

Fund 

On-duty disability benefits are 

provided for injuries received 

while on duty as a firefighter 

with no length of service 

requirement. For firefighters 

with at least 6 years of service, 

heart disease, lung disease, 

and cancer are presumptive 

on-duty disabilities if a physical 

examination showed no signs 

of the disease prior to 

employment or prior to 

claiming the disability. 

Two types of recurring monthly on-duty disability retirement 

benefits are available. 

Payment calculations 

• Occupational disability (incapable of performing the duties 

of a firefighter, but may be capable of other employment): 

Payments are based on either 50% of average monthly 

salary, or the formula for normal retirement based on length 

of service, whichever is greater.a

• General disability (unable to maintain any gainful 

employment): Payments are based on either 75% of average 

monthly salary, or the formula for normal retirement, 

whichever is greater.

Payment cap

80% of average monthly salary (the maximum a firefighter can 

receive for normal retirement based on length of service). 

Additional benefits 

• A lump-sum payment of $5,000 is provided to most

firefighters retiring on either disability retirement or normal 

retirement.b

• A monthly supplemental payment of $150 is paid to retirees, 

including disability recipients.

• An annual supplemental benefit is provided that varies 

depending on the monthly payment amount and length of 

time retired.

According to program

officials, disability

retirement benefits are

treated as federally taxexempt. However, any 

amount received due to the 

normal retirement

calculation that is greater 

than the disability

retirement benefit 

otherwise calculated is 

subject to taxation. 

Page 76 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

Receipt of other income and benefits Cost-of-living 

adjustments Post-injury wages Disability compensation payments 

A 3% annual COLA is 

provided to

occupational disability

retirees beginning at 

age 48, and to

general disability 

retirees at any age. 

Can receive earnings from other employment while

receiving occupational disability benefits. However, can 

receive general disability benefits only if cannot maintain 

any gainful employment, and the Board of Trustees

requires annual income reports to be submitted to monitor 

compliance. 

According to program officials, can receive workers’ 

compensation benefits concurrently with disability retirement 

benefits with no offset of the retirement benefit. 

Source: GAO analysis based on statutes, regulations, program policies, and interviews with program officials. 

Military personnel

a

Injured members continue to draw their regular salary while undergoing fitness evaluation until they 

return to duty or are released from service. (Release from service may be due to separation, 

retirement, or placement on the temporary disability retirement list.) According to DOD instructions, 

referral for evaluation shall occur within 1 year, but there is no binding time limit for the end of 

continuation of pay. Pay received during this time is taxable, the same as pay received pre-injury. 

Under temporary disability retirement, recurring monthly payments are available in situations following 

the period of continuation of pay if the member is still unfit for duty, but the disability is not determined 

to be of a permanent nature and stable. Qualifications and payment amounts are the same as for 

permanent disability retirement, except that the minimum payment is 50% of basic pay or of the high 

3-year average, whichever is applicable. Disability can be considered temporary for up to 5 years

maximum. After 5 years, the member must be: (1) placed either on the permanent disability

retirement list or 20-year (normal service) retirement list; (2) separated with disability severance; or

(3) returned to active duty or reserve service. During temporary disability retirement, the member is

treated the same as a regular retiree. On the one hand, housing benefits are no longer provided, and 

the time does not count toward a regular service retirement. On the other hand, the member is 

eligible to receive VA service-connected compensation benefits (with offset to the temporary disability

retirement payment, as appropriate). The servicemember is subject to medical examination at least 

once every 18 months. 

Page 77 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

b

Generally, servicemembers must have 8 years of active service prior to the date of disability

separation or retirement for any disability associated with a pre-existing condition to be covered.

c

This applies to servicemembers on active duty for more than 30 days, and servicemembers on active

duty for 30 days or less and reserve component members performing inactive-duty training or funeral 

honors duty, with some restrictions. Those who do not meet these requirements may be eligible for 

disability severance: a lump-sum payment for servicemembers who have at least 6 months of service 

and are found unfit for duty, but who have fewer than 20 years of service and whose disability is rated 

less than 30%. (According to DOD officials, both inactive duty and active duty service can count 

toward the 6-month requirement, the same as computed for entitlement to retirement pay.) Disability 

severance is calculated based on the highest monthly basic pay the member would have been

entitled to by law, times twice the number of years of service (up to 12), or in the case of a reserve 

component member, the equivalent number of years creditable toward a reserve retirement. 

d

For servicemembers with a date of initial entry into military service on or after September 8, 1980, 

the high-3 average of basic pay is used in the computation. For reserve component members, it is the 

average of the last 36 months of basic pay as though the member were on full-time active duty. 

e

Only the amount of payment calculated based on basic pay and disability rating is tax-exempt. If the

actual payment received is greater because it is calculated based on length of service, then the 

portion of the payment in excess of the basic pay and disability rating calculation is taxable. 

f

See app. I, military personnel, for details on this program. 

g

Including reserve retirees eligible to receive retired pay. 

h

The phase out is taking place over a 10-year period, beginning on January 1, 2004, under a program 

entitled Concurrent Retirement and Disability Payments. 

i

To qualify for this exception to the offset, currently veterans cannot be receiving compensation at the 

100% disability level due to unemployability. However, in 2006, legislation was enacted authorizing 

these veterans to qualify for the exception to the offset as well, beginning in fiscal year 2010. 

j

This benefit, called Combat-Related Special Compensation, is provided to servicemembers who have 

a disability incurred as a direct result of armed conflict, especially hazardous service, training 

exercises that simulate war, or caused by an instrumentality of war. Servicemembers must have 20 

years or more of service (that is, be eligible for normal retirement); if part of the reserve component,

members must be age 60 and have 20 qualifying years of service (that is, be eligible for reserve 

retirement).

Federal PSOs

a

Unless hired before 1984 and opting to remain under the Civil Service Retirement System. FERS 

generally covers all federal employees hired on or after January 1, 1984. 

b

The disabling injury must be expected to continue for at least 1 year from the date the application for 

disability retirement is filed, accommodation of the disabling medical condition in the position held 

must be unreasonable, and the individual must not have declined an offer of reassignment to a 

vacant position. 

c

Average high-3 salary is the average of the greatest 3 consecutive years of earned wages in 

creditable service. If the employee did not work for 3 years, the average salary for the total period of 

creditable service is applied. 

d

If the PSO chooses to take normal voluntary retirement, instead of disability retirement, the 

retirement benefit is calculated the same way, but a special retirement supplement is also provided 

until age 62 that approximates the Social Security benefit earned in federal service. After the PSO 

reaches the minimum retirement age, if earnings from wages or self-employment exceed the Social 

Security annual exempt amount, the supplement will be reduced or stopped. 

Page 78 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

e

The COLA is equal to the Consumer Price Index increase when the index increase is between 0 and

2%; the COLA increase is 2% if the index increase is between 2 and 3%; the COLA increase is equal 

to the index increase less 1% when the index increase is greater than 3%. The COLA does not apply 

to disability retirees receiving benefits equal to 60% of their average high-3 salary (that is, in the first 

year of benefit receipt). Those taking disability retirement after normal retirement age would begin to 

receive the COLA immediately. 

f

The Office of Personnel Management considers income from self-employment and earned wages 

only. 

Selected state PSOs

California

a

This benefit is for work-related injuries only. A separate disability retirement benefit exists for nonwork-related injuries. 

b

Most non-safety workers only have access to disability retirement (not industrial disability retirement) 

and must have 5 or 10 years of service to qualify, depending on the specific provisions relevant to the 

plan for that occupation. 

c

However, industrial disability retirement payments can be received with earnings for up to 960 hours 

annually, with no limitation or offset, if the individual is appointed during an emergency or to provide 

specialized work for a limited duration. 

Florida

a

Members who have previously retired under the normal retirement provisions, or who have 

participated in the Deferred Retirement Option Plan, are not eligible for disability benefits. 

b

Based on the highest 5 years under the Florida Retirement System. 

c

Members of the special risk class, which includes State Highway Patrol Officers, must be age 55 (or 

age 52 with 25 years of creditable special risk service) to retire without having benefits reduced for 

not yet being normal retirement age. 

Indiana

a

The Pension Trust Agreement has two systems: one covers employees hired prior to July 1, 1987; 

the second covers employees hired on or after July 1, 1987, and after, or employees hired before July

1, 1987, who have elected to receive coverage under the second system. This appendix describes

the benefits available for employees under the second, post-1987 benefit system. 

b

According to a program manager, officers with line-of-duty disabilities are provided sick pay for 365 

days, in addition to their sick leave normally accrued. 

c

In cases of permanent and total disability by catastrophic injury, an officer’s dependents may also

attend a state higher education institution at no cost. 

d

If more than 25 years of service, then additional monthly retirement benefits are provided as follows: 

5% of the basic pension amount for each additional year up to 28; plus 6% for each additional year up 

to 30; plus 7% for each additional year up to 32; plus 8% for each additional year up to 34, up to a 

maximum of 78.5% of the average monthly salary. 

e

If the officer has more than 25 years of service at the time of retirement, the officer’s normal 

retirement benefits would include additional benefits with a higher cap, as noted above. 

Page 79 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

New Jersey

a

Multiple types of retirement benefits are available, depending on the circumstances. Accidental 

disability benefits are provided for line-of-duty injuries caused by a traumatic event. The benefits

provided for accidental disability are greater than those provided for ordinary (non-line-of-duty)

disability. 

b

The amount of the adjustment equals 60% of the percentage of change between the average 

Consumer Price Index for the year in which the person retired and the average Consumer Price Index 

for the 12-month period ending August 31, immediately preceding the year the adjustment is payable.

c

The lump-sum compensation payments provided in cases of amputations are excluded from this 

provision and may be received with no offset. 

Texas

a

Program officials noted that no COLAs have been granted for the past 3 years, nor are any projected 

for the next 3 to 5 years. 

b

Program officials told us that even if an individual is working and earning less than the pre-injury 

wage, disability retirement benefits may still be withheld if it is determined that the individual is

capable—based on training, education, and experience—of earning comparable pay to the pre-injury 

wage. 

Selected local PSOs

Los Angeles

a

This summary covers members of Tier 5, which applies, according to program officials, to most of the 

currently-employed firefighters. However, some firefighters are covered under other tiers and other 

provisions would apply. 

b

Once an employee has been on disability retirement for at least 5 years and is subsequently

determined to have recovered, the disability pension can be reduced to a minimum of 30%, but it 

cannot be discontinued. 

c

To determine the level of disability, the Board of Fire and Police Pension Commissioners uses a 

disability rating worksheet developed by the Department of Fire and Police Pensions.

d

This payback applies to all injuries previously claimed under workers’ compensation, regardless if the 

same or different from the injury claimed as the basis for disability retirement benefits. The payback

also includes any attorney fees paid out of workers’ compensation. 

Miami

a

There is also a lump-sum benefit provided to all firefighters by a different state retirement program, 

the Miami Firefighters’ Relief and Pension Fund Board. The Pension Fund Board receives funds from 

state taxes on property insurance premiums, and distributes them annually on an equal basis to an

individual account for each firefighter. Upon retirement, a firefighter cashes out of the system and 

receives the amount in the individual account, plus interest. In 2003, Miami received $4.4 million from 

this fund and had approximately 500 active firefighters. Therefore, each firefighter received 

approximately $8,800 in 2003 in his or her Pension Fund account. According to officials, Miami Police 

Officers receive a similarly-structured benefit through another program. 

b

Final compensation is the compensation rate at the time of injury. Applicants are not eligible for

additional benefits based on normal service retirement eligibility: they must choose to take either

normal retirement or disability retirement. To take normal retirement, applicants must be 50 years old 

with at least 10 years of creditable service, or have combined age and creditable service of 64 years 

or more. Service retirement is calculated at 3% per year of final average compensation for the first 15 

years of service, and 3.5% per year for every year beyond the first 15 years. 

Page 80 GAO-06-4 Disability Benefits
Appendix II: Disability Retirement Benefits 

Programs 

c

The only restriction on earnings for an individual on accidental disability retirement is that, if 

employed as a firefighter or police officer elsewhere, or performing similar duties, the sum of current 

earnings and the disability pension cannot exceed 100% of the pre-injury earnings. If it does exceed 

100%, then the disability pension may be offset for any amount over 100% of the pre-injury earnings. 

Indianapolis

a

Occupational disease is “a disease arising out of and in the course of employment.”

b

Base salary is stipulated in the bargaining contract between the union and the city. As of 2005, base 

salaries ranged from $48,410 for a third-year firefighter to $66,688 for a battalion chief.

c

According to program officials, there are no internal guidelines to differentiate between duty-related 

and occupational disease, and the decision would be made on a case-by-case basis. 

d

There must be a connection between the conditions under which the firefighter performed his or her 

duties, the disease must be a natural incident resulting from exposure during duties, and the job must 

be the proximate cause of the disease. 

Newark

a

Multiple types of retirement benefits are available, depending on the circumstances. Accidental 

disability benefits are provided for line-of-duty injuries caused by a traumatic event. The benefits

provided for accidental disability are greater than those provided for ordinary, or non-line-of-duty,

disability.

b

According to a program official, total and permanent disability for the Police and Firemen’s

Retirement System means an inability to perform the functions of a firefighter or police officer 

specifically, and does not necessarily preclude future work in alternative occupations. 

c

The amount of the adjustment equals 60% of the percentage of change between the average 

Consumer Price Index for the year in which the person retired and the average Consumer Price Index 

for the 12-month period ending August 31, immediately preceding the year the adjustment is payable.

d

The lump-sum compensation payments provided in cases of amputations are excluded from this 

provision and may be received with no offset. 

Houston

a The formula for calculating normal service retirement is 50% of average monthly salary for 20 years 

of participation, plus 3% of average monthly salary for each year of participation over 20 years up to a

maximum of 80%. 

b

The lump-sum payment is not issued to deferred retirees—that is, members working 10 to 20 years 

who do not start receiving their pensions until age 50. 

Page 81 GAO-06-4 Disability Benefits
Appendix III: Other Disability Benefit 

Programs 

Administering agency Injuries covered Disability payments Tax exemptions 

Public Safety Officers’ Benefits Program

Department of Justice, Bureau

of Justice Assistance 

All line-of-duty injuries to a 

federal, state, or local PSO that 

are permanently and totally 

disabling (that is, injuries that 

permanently prevent a PSO

from performing any gainful 

work).a To qualify, the injuries 

must be the direct and 

proximate result of a 

catastrophic injury sustained in

the line of duty, and not result 

from intentional misconduct, 

intoxication, or gross 

negligence. No length of service 

requirement. 

A one-time lump-sum payment

is provided to all qualifying

PSOs.b

Payment calculation

The payment amount is the 

same for all qualifying PSOs 

injured in a given year. For 

injuries incurred in fiscal year 

2005, the payment amount was 

set at $275,658.

c

Payment cap

Not applicable.

The Internal Revenue Service

has issued a decision letter 

indicating that the program’s 

death benefit is not federally 

taxable. According to 

Department of Justice officials,

the Internal Revenue Service 

has not issued a comparable 

decision letter with regard to the 

program’s disability benefit. 

Social Security Disability Insurance (SSDI)

Social Security Administration Any physical or mental 

impairment that precludes an 

employee from performing 

substantial gainful activity, 

which is expected to last at least 

1 year or result in death.a

 All 

employees who contribute into 

the Social Security system and 

who have at least 40 quarters of 

coverage are eligible.b

 Younger 

employees may qualify with

fewer quarters of coverage.c

 If

alcoholism or drug addiction is

determined to be a contributing 

material factor to the disability,

then the Social Security 

Administration may deny 

benefits. 

A monthly disability payment is

provided beginning the sixth 

month after the date of onset of 

the disability.d

Payment calculation

The amount of benefits received 

is dependent on lifetime 

average earnings and 

contributions into Social 

Security. Added benefits may 

also be payable to certain 

eligible family members.e

Payment cap

The cap is based on the formula 

for calculating benefits. In 2005, 

the maximum payment was 

$1,939 per month.f

SSDI benefits receive the same

federal tax treatment as Social

Security retirement/old age 

benefits. Portions of SSDI 

benefits are federally taxable if 

they exceed monetary 

thresholds. For example, in 

2005, if an individual’s income is 

between $25,000 and $34,000, 

up to 50% of benefits may be 

taxable. If income is above 

$34,000, up to 85% of benefits 

may be taxable. 

Appendix III: Other Disability Benefit 

Programs 

Page 82 GAO-06-4 Disability Benefits
Appendix III: Other Disability Benefit 

Programs 

Receipt of other income and benefits 

Cost-of-living adjustments Post-injury wages Disability compensation and retirement payments

Not applicable. (Single lump-sum 

payment.) 

To qualify for the program’s 

disability benefit, a PSO must not be 

able to perform any gainful work. 

Can be received concurrently with most other

benefits, with no offset in most cases.d 

A yearly COLA is provided based on the 

Consumer Price Index. 

Can receive SSDI with earnings, up 

to certain limits. Generally, in 2005, 

earnings could not exceed $830 per 

month (or $1,380 per month in

cases of blindness). 

Can receive concurrently with disability compensation 

benefits, but the combined amount of benefits cannot 

exceed 80% of pre-injury earnings. In most cases, the 

SSDI benefit is offset to adhere to this limit.g

Can receive SSDI concurrently with disability 

retirement benefits. Offsets to disability retirement 

benefits vary. 

Source: GAO analysis based on statutes, regulations, program policies, and interviews with program officials. 

Public Safety Officers’ Benefits Program

a

The Public Safety Officers’ Benefits Program also provides a death benefit that is the same dollar 

amount as the disability benefit. 

b

In addition, the program offers an educational benefit, capped at $803 per month in fiscal year 2005, 

to spouses and dependents of PSOs who qualify for either the death or disability benefit. 

Page 83 GAO-06-4 Disability Benefits
Appendix III: Other Disability Benefit 

Programs 

c

The availability of the disability benefit is subject to federal appropriation. By statute, the payment 

amount is adjusted annually based on the Consumer Price Index. 

d

Benefits provided by the Public Safety Officers’ Benefits Program are reduced (offset) by benefits 

authorized by District of Columbia Code § 4-622, and issued by the District of Columbia to employees 

who generally qualify as PSOs. FECA benefits for non-federal law enforcement officers who incur 

total and permanent disabilities resulting from law enforcement activities while interceding in crimes 

against the United States are offset by the amount of the Public Safety Officers’ Benefits Program 

benefit. 

SSDI

a

There is no requirement that the injury by work-related. 

b

The Social Security Administration bases quarters of coverage on earnings, using work history to 

determine eligibility for retirement, disability benefits, or survivor benefits. Twenty of the quarters of 

coverage must have come within 10 years of the date of onset of the disability. In 2005, the Social 

Security Administration awarded one credit for each $920 of earnings, up to the maximum of 4 

quarters of coverage per year. 

c

For individuals who are not yet age 31, they must have quarters of coverage in at least half the 

quarters during the period that begins with the quarter after attaining age 21 and ends with the 

quarter prior to incurring the disability.

d

Individuals may be eligible for Supplemental Security Income benefits if they meet income and asset 

limits.

e

According to the Commissioner, the amount of the additional benefits payable to family members of 

an individual with disabilities varies, but generally does not exceed 50% of the individual’s benefit, 

and is limited by law. She noted that in December 2005, the average monthly disability benefit paid to 

an individual without dependents was $938, while the average monthly disability benefit paid to an 

individual with dependents (spouse and children) was $1,571.

f

This amount assumes the person is at full retirement age and has made the maximum earnings

contributions. For retirees born in 1939, full retirement age is 65 and 4 months; for those born in 

1940, it is 65 and 6 months. Full retirement age will gradually increase to age 67 for those born in 

1960 or later. Added benefits may also be payable to eligible family members (see note e above). 

g

In 14 states, the workers’ compensation benefit is allowed the offset to adhere to this limit, instead of

the SSDI benefit.

Page 84 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits— Appendix IV Methods and Results : Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

This appendix identifies the package of disability benefits available to 

eligible military personnel and selected civilian PSOs injured in the line of 

duty under varying circumstances. To illustrate the benefits available to 

military personnel and civilian PSOs of varying ages, lengths of service, 

and salary levels, we constructed five hypothetical profiles of individuals, 

as follows: 

(1) Age 20, 1 year of service, average salary: $20,000. 

(2) Age 25, 6 years of service, high-3 average salary: $40,000. 

(3) Age 35, 12 years of service, high-3 average salary: $60,000.

(4) Age 45, 22 years of service, high-3 average salary: $85,000.

(5) Age 55, 32 years of service, high-3 average salary: $85,000.

We selected the salary levels to reflect the general range of pay provided

to those in the military, and to those serving as PSOs across the country. 

These salaries do not reflect the actual pay scales for servicemembers or 

for any specific PSOs. For example, according to the military’s pay scales 

for 2005, an enlisted servicemember with 1 year of service would have

basic pay of $14,822; an officer with 1 year of service, $28,124. Entry level

salaries for state police officers in 2000 ranged from a low of $21,063 in

Florida to a high of $45,696 in Alaska. (See app. V for a more detailed 

discussion of the impact of salary differentials.) 

We selected the various ages and lengths of service to capture differences

that may exist in the benefits available to those employed for only a year, 

compared with the benefits available to those who incur disabilities after 

being employed long enough to qualify for normal retirement based on age 

and/or years of service. We did this to be able to describe more fully how 

the benefit programs work. No distribution of disabilities across the 

various ages and lengths of service should be inferred from the 

construction of these hypothetical profiles. 

Page 85 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

In addition, we created scenarios surrounding three different levels of 

injury, as follows: 

Injury level 1: Tinnitus. A ringing, swishing, or other type of noise that 

seems to originate in the ear or head. Only the patient can hear the noise.

• 10 percent VA and DOD disability rating. 

• Up to 5 percent can be added to a disability rating for tinnitus in the 

presence of measurable hearing loss if it affects activities of daily living, 

based on the AMA Guides for whole person impairment. 

• GAO assumption: physician assessment determines that the civilian PSOs 

with tinnitus have a 5 percent impairment due to hearing loss.

• GAO assumption: physician assessment determines that the individual is

able to perform a substantial portion of his or her current job duties. 

• GAO assumption: able to return to duty in previous position. 

Injury level 2: Leg amputated below the knee. Removal of the lower 

leg and foot due to injury, diabetes, frostbite, arteriosclerosis, or other 

illness. 

• 40 percent VA and DOD disability rating. 

• 32 percent physician disability rating based on AMA Guides for whole 

person impairment. 

• GAO assumption: physician assessment determines that the individual is

no longer able to perform a substantial portion of his or her current job 

duties, but could be gainfully employed in alternative job. 

• GAO assumption: not able to return to duty in previous position, but 

secures employment with alternative employer (not under same 

retirement system) and earns 75 percent of previous pay. 

Injury level 3: Quadriplegia. Paralysis of all four limbs (both arms and 

both legs) as from a high spinal cord accident or stroke. 

• 100 percent VA and DOD disability rating. 

• 100 percent physician disability rating based on AMA Guides for whole 

person impairment. 

• GAO assumption: physician assessment determines that the individual is

no longer able to perform the duties of his or her current job and could not 

be gainfully employed in alternative job. 

• GAO assumption: Not able to return to duty in previous position, nor 

secure gainful employment with alternative employer. 

Page 86 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

We selected these injuries to illustrate the range of benefits provided 

based on degree of impairment: from a relatively minor injury (tinnitus) 

that generally would not prevent an individual from returning to duty; to a 

more serious injury (leg amputation) that generally would prevent an 

individual from returning to duty, but not from being employed in some 

other type of occupation; to a very serious injury (quadriplegia) that 

generally prevents an individual from any type of employment. 

For each occupation and site, we calculated the monthly and lump-sum 

benefits that would be provided for each individual profile at each injury

level from each relevant program, and had our calculations reviewed and 

confirmed by cognizant agency staff. We then calculated a combined 

monthly benefit amount of compensation and disability retirement 

benefits. We took into account any provisions requiring the offset of one 

benefit against another, which is sometimes required when an individual is 

eligible to receive benefits from multiple sources. Although available from 

some programs, no added increments for dependents were included. 

Finally, we calculated the present value of the lifetime benefit stream of 

monthly and lump-sum payments for each scenario. Present value analysis

relies on two basic assumptions: the expected length of time benefits will 

be received, and the rate at which future payments will be discounted (on 

the basis that a dollar today is worth more than a dollar received a year 

from today). For the first assumption, we used Social Security 

Administration mortality data to estimate how long each hypothetical 

individual would be expected to live. For the quadriplegia cases, we used 

mortality data for males from the SSDI program to account for a shorter 

expected lifespan.1

 For the leg amputation and tinnitus cases, we used 

general population mortality tables for males.2

 In all cases, we used data 

for males only as males account for a sizable majority of both military 

personnel and civilian PSOs.3

 1

Social Security Administration, Social Security Disability Insurance Program: Worker 

Experience, Actuarial Study No. 118, June 2005, SSA Pub. No. 11-11543. 

2

Social Security Administration, Life Tables for the United States Social Security Area, 

Actuarial Study No. 120, Aug. 2005, SSA Pub. No. 11-11536. 

3

As of 2000, 85.4 percent of the active-duty force was male and 14.6 percent was female. In 

2001, it was estimated that about 89 percent of law enforcement officers nationwide were

male and about 11 percent female. 

Page 87 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

The second assumption about the discount rate involves assumptions 

about inflation,4

 the rate of interest absent inflation, and cost-of-living 

adjustments (COLA). We assumed the rate of interest absent inflation (the 

real interest rate) is 3 percent and that inflation is constant at 3 percent 

annually, resulting in an assumed nominal interest rate (which is the sum 

of the real interest rate and inflation) of 6 percent. In specifying a discount 

rate, our present value analysis takes into account whether the program 

has a COLA provision and the specific provisions for how the COLA is 

calculated. If the COLA is equal to the Consumer Price Index, we 

categorized it as full. If the COLA is capped or otherwise limited, we 

categorized it as partial. We assumed that a full COLA is equal to the rate 

of inflation, and that a partial COLA is worth 1 percentage point less. 

Following the rule that a nominal rate of interest is used to discount 

nominal quantities, and that real rates of interest (equal to the nominal 

rate minus inflation) are used to discount real quantities,5 we used a 

discount rate of 6 percent for benefit programs with no COLA, 4 percent

for programs with a partial COLA, and 3 percent for programs that provide 

a full COLA. 

We did not adjust benefit payment, or annuity streams, for various 

survivorship options. We assumed an annuity stream for disability 

retirement payments for the recipient’s remainder of life with no survivor 

benefits to follow. 

 4

By inflation, we mean the rate of aggregate price change as measured by an index, such as

the Consumer Price Index. 

5

GAO, Discount Rate Policy (GAO/OCE-17.1.1, May 1991), 18. 

Page 88 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Table 10: Benefits Provided for Tinnitus

Hypothetical individuals, 

by occupation 

Disability compensation 

monthly benefit 

Total disability compensation 

benefits provideda

 

Age 20, 1 year of service, salary of $20,000 

Military personnel 

• Leaving service at earliest opportunityb $108 for lifec$33,036 (annuity factor: 25.491) 

• Leaving service only after 20 years of service $108 for lifec $15,669 (annuity factor: 12.091) 

Federal PSOs $1,111 for 2.3 monthsd$2,564

Selected state PSOs 

• California Highway Patrole $810 for 5.5 months $4,486 

• Florida Highway Patrol $833 for 2.3 months $1,922 

• Indiana State PolicefNot applicable Not applicable

• Montana Highway Patrol $1,111 for 8.8 months $9,743 

• New Jersey State Police $770 for 2.3 months $1,777 

• Texas State Troopers $1,167 for 3.5 months $4,040 

Selected local PSOs 

• Los Angeles Firefighterse$810 for 5.5 months $4,486 

• Miami Firefighters $833 for 2.3 months $1,922 

• Indianapolis Firefightersf Not applicable Not applicable

• Billings Firefighters $1,111 for 8.8 months $9,743 

• Newark Firefighters $770 for 2.3 months $1,777 

• Houston Firefighters $1,167 for 3.5 months $4,040 

Age 25, 6 years of service, salary of $40,000 

Military personnel 

• Leaving service at earliest opportunityb $108 for lifec$33,034 (annuity factor: 25.489) 

• Leaving service only after 20 years of service $108 for lifec $18,290 (annuity factor: 14.112) 

Federal PSOs $2,222 for 2.3 monthsd$5,128

Selected state PSOs 

• California Highway Patrole $810 for 6.2 months $5,047 

• Florida Highway Patrol $1,667 for 2.3 months $3,847 

• Indiana State PolicefNot applicable Not applicable

• Montana Highway Patrol $1,127 for 8.8 months $9,883 

• New Jersey State Police $770 for 2.3 months $1,777 

• Texas State Troopers $1,634 for 3.5 months $5,656 

Selected local PSOs 

• Los Angeles Firefighterse$810 for 6.2 months $5,047 

• Miami Firefighters $1,667 for 2.3 months $3,847 

• Indianapolis Firefightersf Not applicable Not applicable

Page 89 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical individuals, 

by occupation 

Disability compensation 

monthly benefit 

Total disability compensation 

benefits provideda

 

(Table 10: Tinnitus—continued) 

• Billings Firefighters $1,127 for 8.8 months $9,883 

• Newark Firefighters $770 for 2.3 months $1,777 

• Houston Firefighters $1,634 for 3.5 months $5,656 

Age 35, 12 years of service, salary of $60,000 

Military personnel 

• Leaving service at earliest opportunityb $108 for lifec$29,801 (annuity factor: 22.995) 

• Leaving service only after 20 years of service $108 for lifec$20,629 (annuity factor: 15.917) 

Federal PSOs $3,333 for 2.3 monthsd$7,692

Selected state PSOs 

• California Highway Patrole $810 for 7.0 months $5,654 

• Florida Highway Patrol $2,500 for 2.3 months $5,769 

• Indiana State PolicefNot applicable Not applicable

• Montana Highway Patrol $1,127 for 8.8 months $9,883 

• New Jersey State Police $770 for 2.3 months $1,777 

• Texas State Troopers $1,634 for 3.5 months $5,656 

Selected local PSOs 

• Los Angeles Firefighterse$810 for 7.0 months $5,654 

• Miami Firefighters $2,500 for 2.3 months $5,769 

• Indianapolis Firefightersf Not applicable Not applicable

• Billings Firefighters $1,127 for 8.8 months $9,883 

• Newark Firefighters $770 for 2.3 months $1,777 

• Houston Firefighters $1,634 for 3.5 months $5,656 

Age 45, 22 years of service, salary of $85,000 

Military personnel $108 for lifec$25,759 (annuity factor: 19.876) 

Federal PSOs $4,722 for 2.3 monthsd$10,897

Selected state PSOs 

• California Highway Patrole $810 for 8.8 months $7,150 

• Florida Highway Patrol $2,821 for 2.3 months $6,510 

• Indiana State PolicefNot applicable Not applicable

• Montana Highway Patrol $1,127 for 9.5 months $10,663 

• New Jersey State Police $770 for 2.3 months $1,777 

• Texas State Troopers $1,634 for 3.5 months $5,656 

Selected local PSOs 

• Los Angeles Firefighterse$810 for 8.8 months $7,150 

• Miami Firefighters $2,821 for 2.3 months $6,510 

Page 90 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical individuals, 

by occupation 

Disability compensation 

monthly benefit 

Total disability compensation 

benefits provideda

 

(Table 10: Tinnitus—continued) 

• Indianapolis Firefightersf Not applicable Not applicable

• Billings Firefighters $1,127 for 9.5 months $10,663 

• Newark Firefighters $770 for 2.3 months $1,777 

• Houston Firefighters $1,634 for 3.5 months $5,656 

Age 55, 32 years of service, salary of $85,000 

Military personnel $108 for lifec$20,972 (annuity factor: 16.182) 

Federal PSOs $4,722 for 2.3 monthsd$10,897

Selected state PSOs 

• California Highway Patrole $810 for 9.8 months $7,898 

• Florida Highway Patrol $2,821 for 2.3 months $6,510 

• Indiana State PolicefNot applicable Not applicable 

• Montana Highway Patrol $1,127 for 9.5 months $10,663 

• New Jersey State Police $770 for 2.3 months $1,777 

• Texas State Troopers $1,634 for 3.5 months $5,656 

Selected local PSOs 

• Los Angeles Firefighterse$810 for 9.8 months $7,898 

• Miami Firefighters $2,821 for 2.3 months $6,510 

• Indianapolis Firefightersf Not applicable Not applicable 

• Billings Firefighters $1,127 for 9.5 months $10,663 

• Newark Firefighters $770 for 2.3 months $1,777 

• Houston Firefighters $1,634 for 3.5 months $5,656 

Source: GAO analysis based on program provisions summarized in apps. I and II. 

a

Total compensation benefits for military personnel reflect the present value of VA benefits provided 

over a lifetime, using the annuity factors indicated. These annuity factors take into account mortality 

rates, discount rates, and COLAs, as appropriate. 

b

 For purposes of our analysis, we assume that the servicemembers’ tours of duty are such that, 

although still fit for duty, they can choose to separate immediately upon the determination of a 

permanent disability, with one exception: We assume that the servicemember with only 1 year of 

service must complete 2 years of service before being able to choose to separate. 

c

Upon separation from military service, VA compensation benefits are provided for the remainder of

life, as long as the impairment persists. 

d

Under FECA, compensation payments are calculated on a 28-day cycle; converted to a monthly 

payment here to facilitate comparison with other programs’ payments.

e

In California, compensation payments are reduced by 15% if the current employer offers comparable 

employment within 60 days. Payments here include this 15% decrease. 

f

In Indiana, both the Indiana State Police and the Indianapolis Fire Department have opted out of 

providing compensation payments from the state workers’ compensation program. 

Page 91 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Table 11: Benefits Provided for a Leg Amputation 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

Age 20, 1 year of service, salary of $20,000 

Military 

personnel 

$550 for life $667 Retirement offset 

dollar-for-dollar

$667 26.477 $211,920

Federal PSOs $1,111 for 66 

months (schedule 

award) 

$278 thereafter 

(wage loss 

benefit)b

Not 

applicablec

Not applicable $1,111 for 

66 months 

$278 

thereafter 

4.639

(compensation

schedule award) 

21.838 

(compensation

wage loss benefit) 

$134,700

Selected state PSOs 

• California 

Highway 

Patrol 

$1,096 for 51.2

monthsd

$833 No offset $1,929 for 

51.2 months 

$833 

thereafter 

3.569

(compensation)

21.950 

(retirement) 

$266,349

• Florida 

Highway 

Patrol 

$833 for 29.3 

months 

Not 

applicable 

Not applicable $833 for 

29.3 months 

1.891 $18,900

• Indiana 

State Police 

Not applicable $1,167 for 

first 2 years 

$833 

thereaftere

Not applicable $1,167 for 

first 2 years 

$833 

thereafter 

22.706

(until 25 years of 

service) 

8.743 

(thereafter) 

$322,385

• Montana 

Highway 

Patrol 

$1,111 for 49.4

months 

$833 No offset $1,944 for 

49.4 months 

$833 

thereafter 

3.569

(compensation)

21.950 

(retirement) 

$266,992

• New Jersey 

State Police 

$1,167 for 53 

months 

$1,111 Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$1,167 for 

53 months 

$1,111 

thereafter 

$18,561f

3.569

(compensation)

17.984 

(retirement) 

$308,298

Page 92 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Texas State 

Troopers 

$1,167 for 22 

months 

(impairment 

benefits), then 

$333 for next 

64.4 months 

(supplemental 

benefits)g 

$833 No offset $2,000 for 

22 months 

$1,167 for 

next 64.4 

months 

$833 

thereafter 

1.891

(compensation

impairment 

benefits) 

3.848 

(compensation

supplemental 

benefits) 

16.082 

(retirement) 

$202,610

Selected local PSOs 

• Los Angeles 

Firefighters 

$1,096 for 51.2

monthsd

$833 Cannot be

received 

concurrentlyh

$833 21.950 $219,412

• Miami 

Firefighters 

$833 for 29.3 

months 

$1,111 No offset $1,944 for 

29.3 months 

$1,111 

thereafter 

(Benefit 

provided, 

but not 

included)i 

1.891 

(compensation)

21.950 

(retirement) 

$311,537

• Indianapolis 

Firefighters 

Not applicable $1,283 to 

age 52

$1,233 

thereafterj

Not applicable $1,283 to 

age 52

$1,233 

thereafter 

17.613 

(to age 52) 

4.337 

(thereafter) 

$335,340

• Billings 

Firefighters 

$1,111 for 49.4

months 

$833 No offset $1,944 for 

49.4 months 

$833 

thereafter 

3.569

(compensation)

21.950 

(retirement) 

$266,992

• Newark 

Firefighters 

$1,167 for 53 

months 

$1,111 Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$1,167 for 

53 months 

$1,111 

thereafter 

$18,561f

3.569

(compensation)

17.984 

(retirement) 

$308,298

• Houston 

Firefighters 

$1,167 for 22 

months 

(impairment 

benefits), then 

$333 for next 

64.4 months 

(supplemental 

benefits) g

$983 No offset $2,150 for 

22 months 

$1,316 for 

next 64.4 

months 

$983 

thereafter 

$5,000k 1.891

(compensation

impairment 

benefits) 

3.848 

(compensation

supplemental 

benefits) 

21.950 

(retirement) 

$305,780

Page 93 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued) 

Age 25, 6 years of service, salary of $40,000 

Military 

personnel 

$550 for life $1,333 Retirement offset 

dollar-for-dollar

$1,333 25.489 $407,728

Federal PSOs $2,222 for 66 

months (schedule 

award) 

$512 thereafter 

(wage loss 

benefit)b

 

$2,000 for 

first year 

$1,333 to 

age 62

$1,577 

thereafter 

Schedule award 

and retirement 

can be received

concurrently with 

no offset; wage

loss benefits and 

retirement cannot 

be received 

concurrently 

$4,222 for 

first year 

$3,555 for 

next 4.5 

years (to end 

of schedule 

award) 

$1,333 for 

next 31.5 

years (to age 

62) 

$1,577 

thereafter 

4.640

(compensation)

0.986 

(retirement first 

year) 

18.135 

(retirement till age 

62) 

2.411 

(retirement 

thereafter) 

$483,087

Selected state PSOs 

• California 

Highway 

Patrol 

$1,096 for 52.9

monthsd

 

$1,333 No offset $2,429 for 

52.9 months 

$1,333 

thereafter 

3.569

(compensation)

21.335 

(retirement) 

$388,210

• Florida 

Highway 

Patrol 

$1,667 for 29.3

months 

Not 

applicable 

Not applicable $1,667 for 

29.3 months 

1.891 $37,821

• Indiana 

State Police 

Not applicable $2,333 for 

first 2 years 

$1,667 

thereaftere

Not applicable $2,333 for 

first 2 years 

$1,667 

thereafter 

19.033 

(until 25 years of 

service) 

10.162 

(thereafter) 

$599,989

• Montana 

Highway 

Patrol 

$1,127 for 49.4

months 

$1,667 No offset $2,794 for 

49.4 months 

$1,667 

thereafter 

3.6569

(compensation)

21.335 

(retirement) 

$475,047

• New Jersey 

State Police 

$1,539 for 53 

months 

$2,222 Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$2,222 $24,495f3.571

(compensation)

3.702 

(retirement for 53 

months) 

17.633 

(retirement 

thereafter) 

$590,954

Page 94 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Texas State 

Troopers 

$1,634 for 22 

months 

(impairment 

benefits), then 

$667 for next 

64.4 months 

(supplemental 

benefits) g

$1,667 No offset $3,301 for 

22 months 

$2,334 for 

next 64.4 

months 

$1,667 

thereafter 

1.891

(compensation

impairment 

benefits) 

3.849 

(compensation

supplemental 

benefits) 

15.826 

(retirement) 

$384,478

Selected local PSOs 

• Los Angeles 

Firefighters 

$1,096 for 52.9

monthsd

$1,667 Cannot be

received 

concurrentlyh

$1,667 21.335 $426,780

• Miami 

Firefighters 

$1,667 for 29.3

months 

$2,222 No offset $3,889 for 

29.3 months 

$2,222 

thereafter 

(Benefit 

provided, 

but not 

included)i 

1.891 

(compensation)

21.335 

(retirement) 

$606,690

• Indianapolis 

Firefighters 

Not applicable $2,567 to 

age 52

$2,467 

thereafterj

Not applicable $2,567 to 

age 52

$2,467 

thereafter 

16.022

(to age 52) 

5.313 

(thereafter) 

$650,819

• Billings 

Firefighters 

$1,127 for 49.4

months 

$1,667 No offset $2,794 for 

49.4 months 

$1,667 

thereafter 

3.569

(compensation)

21.335 

(retirement) 

$475,047

• Newark 

Firefighters 

$1,539 for 53 

months 

$2,222 Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$2,222 $24,495 f 3.571 

(compensation)

3.702 

(retirement for 53 

months) 

17.633 

(retirement 

thereafter) 

$590,954

Page 95 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Houston 

Firefighters 

$1,634 for 22 

months 

(impairment 

benefits), then 

$667 for next 

64.4 months 

(supplemental 

benefits) g

$1,817 No offset $3,451 for 

22 months 

$2,484 for 

next 64.4 

months 

$1,817 

thereafter 

$5,000k 

 1.891 

(compensation

impairment 

benefits) 

3.849 

(compensation

supplemental 

benefits) 

21.335 

(retirement) 

$538,069

Age 35, 12 years of service, salary of $60,000 

Military 

personnel 

$550 for life $2,000 Retirement offset 

dollar-for-dollar

$2,000 22.995 $551,869

Federal PSOs $3,333 for 66 

months (schedule 

award) 

$769 thereafter 

(wage loss 

benefit)b

$3,000 for 

first year 

$2,000 to 

age 62

$2,145 

thereafter 

Schedule award 

and retirement 

can be received

concurrently with 

no offset; wage

loss and 

retirement cannot 

be received 

concurrently 

$6,333 for 

first year 

$5,333 for 

next 4.5 

years (to end 

of schedule 

award) 

$2,000 for 

next 21.5 

years (to age 

62) 

$2,145 

thereafter 

4.633

(compensation)

0.985 

(retirement first 

year) 

15.349 

(retirement to age 

62) 

3.618 

(retirement 

thereafter) 

$682,276

Selected state PSOs 

• California 

Highway 

Patrol 

$1,096 for 59.3

monthsd

$1,750 No offset $2,846 for 

59.3 months 

$1,750 

thereafter 

4.330

(compensation)

19.660 

(retirement) 

$469,807

• Florida 

Highway 

Patrol 

$2,500 for 29.3

months 

Not 

applicable 

Not applicable $2,500 for 

29.3 months 

1.890 $56,695

• Indiana 

State Police 

Not applicable $3,500 for 

first 2 years 

$2,500 

thereaftere

Not applicable $3,500 for 

first 2 years 

$2,500 

thereafter 

12.057

(until 25 years of 

service) 

6.593 

(thereafter) 

$583,497

Page 96 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Montana 

Highway 

Patrol 

$1,127 for 49.4

months 

$2,500 No offset $3,627 for 

29.4 months 

$2,500 

thereafter 

3.565

(compensation)

19.660 

(retirement) 

$638,017

• New Jersey 

State Police 

$1,539 for 53 

months 

$3,333 Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$3,333 $24,495 f 3.569 

(compensation)

3.699 

(retirement for 53 

months) 

15.961 

(retirement 

thereafter) 

$808,412

• Texas State 

Troopers 

$1,634 for 22 

months 

(impairment 

benefits), then 

$1,000 for next

64.4 months 

(supplemental 

benefits) g

$2,500 No offset $4,134 for 

22 months 

$3,500 for 

next 64.4 

months 

$2,500 

thereafter 

1.890

(compensation

impairment 

benefits) 

3.837 

(compensation

supplemental 

benefits) 

15.021 

(retirement) 

$533,722

Selected local PSOs 

• Los Angeles 

Firefighters 

$1,096 for 59.3

monthsd

$2,500 Cannot be

received 

concurrentlyh

$2,500 19.660 $589,802

• Miami 

Firefighters 

$2,500 for 29.3

months 

$3,333 No offset $5,833 for 

29.3 months 

$3,333 

thereafter 

(Benefit 

provided, 

but not 

included)i 

1.890 

(compensation)

19.660 

(retirement) 

$843,019

• Indianapolis 

Firefighters 

Not applicable $3,850 to 

age 52

$3,400 

thereafterj

Not applicable $3,850 to 

age 52

$3,400 

thereafter 

11.686

(to age 52) 

7.974 

(thereafter) 

$865,235

• Billings 

Firefighters 

$1,127 for 49.4

months 

$2,500 No offset $3,627 for 

49.4 months 

$2,500 

thereafter 

3.565

(compensation)

19.660 

(retirement) 

$638,017

Page 97 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Newark 

Firefighters 

$1,539 for 53 

months 

$3,333 Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$3,333 $24,495 f 3.569 

(compensation)

3.699 

(retirement for 53 

months) 

15.961 

(retirement 

thereafter) 

$808,412

• Houston 

Firefighters 

$1,634 for 22 

months 

(impairment 

benefits), then 

$1,000 for next

64.4 months 

(supplemental 

benefits) g

$2,650 No offset $4,284 for 

22 months 

$3,650 for 

next 64.4 

months 

$2,650 

thereafter 

$5,000k 1.890 

(compensation

impairment 

benefits) 

3.837 

(compensation

supplemental 

benefits) 

19.660 

(retirement) 

$713,293

Age 45, 22 years of service, salary of $85,000 

Military 

personnel 

$550 for life $3,896 Retirement offset 

dollar-for-dollarl

$3,896 19.876 $929,227

Federal PSOs $4,722 for 66 

months(schedule 

award) 

$1,090 thereafter 

(wage loss 

benefit)b

 

$4,250 for 

first year 

$2,833 to 

age 62

$3,039 

thereafter 

Schedule award 

and retirement 

can be received

concurrently with 

no offset; wage

loss and 

retirement cannot 

be received 

concurrently 

$8,972 for 

first year 

$7,555 for 

next 4.5 

years (to end 

of schedule 

award) 

$2,833 for 

next 11.5 

years (to age 

62) 

$3,039 

thereafter 

4.607

(compensation)

0.985 

(retirement first 

year) 

16.281 

(retirement to age 

62) 

5.495 

(retirement 

thereafter) 

$1,065,144

Selected state PSOs 

• California 

Highway 

Patrol 

$1,096 for 66.3

monthsd

$2,271 No offset $3,367 for 

66.3 months 

$2,271 

thereafter 

5.016

(compensation)

17.400 

(retirement) 

$540,149

• Florida 

Highway 

Patrol 

$2,821 for 29.3

months 

Not 

applicable 

Not applicable $2,821 for 

29.3 months 

1.886 $63,844

Page 98 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Indiana 

State Police 

Not applicable $4,958 for 

first 2 years 

$3,542 

thereaftere

Not applicable $4,958 for 

first 2 years 

$3,542 

thereafter 

2.858

(until 25 years of 

service) 

12.050 

(thereafter) 

$667,617

• Montana 

Highway 

Patrol 

$1,127 for 50.3

months 

$3,896 No offset $5,023 for 

50.3 months 

$3,896 

thereafter 

3.550

(compensation)

17.400 

(retirement) 

$861,484

• New Jersey 

State Police 

$1,539 for 53 

months 

$4,722 Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$4,722 $24,495f3.559

(compensation)

3.689 

(retirement for 53 

months) 

13.711 

(retirement 

thereafter) 

$1,008,040

• Texas State 

Troopers 

$1,634 for 22 

months 

(impairment 

benefits), then 

$1,417 for next

64.4 months 

(supplemental 

benefits) g

$4,363 No offset $5,997 for 

22 months 

$5,780 for 

next 64.4 

months 

$4,363 

thereafter 

1.890

(compensation

impairment 

benefits) 

3.796 

(compensation

supplemental 

benefits) 

13.771 

(retirement) 

$822,618

Selected local PSOs 

• Los Angeles 

Firefighters 

$1,096 for 66.3

monthsd

 

$3,542 Cannot be

received 

concurrentlyg

$3,542 17.400 $739,562

• Miami 

Firefighters 

$2,821 for 29.3

months 

$4,722 No offset $7,543 for 

29.3 months 

$4,722 

thereafter 

(Benefit 

provided, 

but not 

included)i 

1.886 

(compensation)

17.400 

(retirement) 

$1,049,788

• Indianapolis 

Firefighters 

Not applicable $5,454 to 

age 52

$4,817 

thereafterj

Not applicable $5,454 to 

age 52

$4,817 

thereafter 

5.290

(to age 52) 

12.110 

(thereafter) 

$1,046,218

Page 99 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Billings 

Firefighters 

$1,127 for 50.3

months 

$3,896 No offset $5,023 for 

50.3 months 

$3,896 

thereafter 

3.550

(compensation)

17.400 

(retirement) 

$861,484

• Newark 

Firefighters 

$1,539 for 53 

months 

$4,722 Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$4,722 $24,495 f 3.559 

(compensation)

3.689 

(retirement for 53 

months) 

13.711 

(retirement 

thereafter) 

$1,008,040

• Houston 

Firefighters 

$1,634 for 22 

months 

(impairment 

benefits), then 

$1,417 for next

64.4 months 

(supplemental 

benefits) g 

$4,117 No offset $5,751 for 

22 months 

$5,534 for 

next 64.4 

months 

$4,117 

thereafter 

$5,000 k 1.890 

(compensation

impairment 

benefits) 

3.796 

(compensation

supplemental 

benefits) 

17.400 

(retirement) 

$966,227

Age 55, 32 years of service, salary of $85,000 

Military 

personnel 

$550 for life $5,313 Retirement offset 

dollar-for-dollar l 

$5,313 16.182 $1,031,707

Federal PSOs $4,722 for 66 

months (schedule 

award) 

$1,090 thereafter 

(wage loss 

benefit)b

 

$3,258 m

 Schedule award 

and retirement 

can be received

concurrently with 

no offset; wage

loss and 

retirement cannot 

be received 

concurrently 

$7,980 for 

5.5 years (to 

end of 

schedule 

award) 

$3,258 

thereafter 

4.554

(compensation)

14.531 

(retirement) 

$826,145

Selected state PSOs 

• California 

Highway 

Patrol 

$1,096 for 73.7

monthsd

$2,271 No offset $3,367 for 

73.7 months 

$2,271 

thereafter 

4.947

(compensation)

14.531 

(retirement) 

$461,071

• Florida 

Highway 

Patrol 

$2,821 for 29.3

months 

Not 

applicable 

Not applicable $2,821 for 

29.3 months 

1.878 $63,584

Page 100 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Indiana 

State Police 

Not applicable $4,958 for 

first 2 years 

$3,825 

thereafter e 

Not applicable $4,958 for 

first 2 years 

$3,825 

thereafter 

1.929 

(for 2 years) 

10.714 

(thereafter) 

$606,539

• Montana 

Highway 

Patrol 

$1,127 for 50.3

months 

$5,667 No offset $6,794 for 

50.3 months 

$5,667 

thereafter 

3.519

(compensation)

14.531 

(retirement) 

$1,035,785

• New Jersey 

State Police 

$1,539 for 53 

months 

$4,722 Retirement offset 

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$4,722 $24,495 f 3.545 

(compensation)

3.674 

(retirement for 53 

months) 

10.857 

(retirement 

thereafter) 

$845,520

• Texas State 

Troopers 

$1,634 for 22 

months 

(impairment 

benefits), then 

$1,417 for next

64.4 months 

(supplemental 

benefits) g

$6,347 No offset $7,981 for 

22 months 

$7,764 for 

next 64.4 

months 

$6,347 

thereafter 

1.880

(compensation

impairment 

benefits) 

3.710 

(compensation

supplemental 

benefits) 

11.977 

(retirement) 

$1,012,161

Selected local PSOs 

• Los Angeles 

Firefighters 

$1,096 for 73. 

months d

 

$4,533 Cannot be

received 

concurrentlyh

 

$4,533 14.531 $790,452

• Miami 

Firefighters 

$2,821 for 29.3

months 

$4,722 No offset $7,543 for 

29.3 months 

$4,722 

thereafter 

(Benefit 

provided, 

but not 

included)i 

1.878 

(compensation)

14.531 

(retirement) 

$886,993

• Indianapolis 

Firefighters 

Not applicable $5,242 j Not applicable $5,242 14.531 $914,085

• Billings 

Firefighters 

$1,127 for 50.3

months 

$5,667 No offset $6,794 for 

50.3 months 

$5,667 

thereafter 

3.519

(compensation)

14.531 

(retirement) 

$1,035,785

Page 101 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, 

by occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset provisions

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicable Annuity factora

 

Present 

value of 

lifetime 

package of

benefits

(Table 11: Leg amputation—continued)

• Newark 

Firefighters 

$1,539 for 53 

months 

$4,722 n Retirement offset

dollar-for-dollar for 

recurring 

compensation 

benefits (not lump 

sum) 

$4,722 $24,495 f 3.545 

(compensation)

3.674 

(retirement for 53 

months) 

10.857 

(retirement 

thereafter) 

$845,520

• Houston 

Firefighters 

$1,634 for 22 

months 

(impairment 

benefits), then 

$1,417 for next

64.4 months 

(supplemental 

benefits) g 

$5,817 No offset $7,451 for 

22 months 

$7,234 for 

next 64.4 

months 

$5,817 

thereafter 

$5,000k1.880

(compensation

impairment 

benefits) 

3.710 

(compensation

supplemental 

benefits) 

14.531 

(retirement) 

$1,119,300

Source: GAO analysis based on program provisions summarized in apps. I and II. 

a

Annuity factors take into account mortality rates, discount rates, and COLAs, as appropriate. Where 

different provisions or changes in benefits over time require different annuity factors, the factors are 

used proportionately as appropriate. 

b

Under FECA, compensation payments are calculated on a 28-day cycle; converted to a monthly 

payment here to facilitate comparison with other programs’ payments. Wage loss benefits reflect 

assumption that the individual secures work with an alternative employer and earns 75% of previous

pay. 

c

Under FERS, 18 months of service are required to qualify for disability retirement benefits. 

d

In California, compensation payments are increased by 15% if no offer of comparable employment is

received from the current employer after 60 days. Payments here include this 15% increase. 

e

In Indiana, disability retirement benefits are provided until the date the officer is credited with 25 

years of service, including years on disability. Then, benefits are recalculated as normal service 

retirement benefits. In this scenario, after the first 2 years, the same formula is used to calculate both 

disability and normal retirement benefits.

f

In New Jersey, an additional 30% of the normal compensation award is added as a lump-sum 

payment in cases of amputations, and this payment can be received concurrently with disability

retirement benefits with no offset.

g

Supplemental benefits reflect assumption that the individual secures work with an alternative 

employer and earns 75% of previous pay. 

h

In Los Angeles, firefighters on disability retirement are required to pay back any workers’

compensation awards they have received throughout their careers. Therefore, lifetime benefits are 

maximized by receiving just disability retirement. 

Page 102 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

i

Miami provides a lump-sum benefit available to firefighters upon retirement, in an amount that varies

depending on several factors that we were not able to estimate; thus, the benefit is not included in 

these calculations. 

ij

n Indianapolis, when the former firefighter reaches age 52, disability retirement benefits are 

recalculated based on the formula for normal service retirement. If already age 52 or older when

applying for retirement due to disability, only normal service retirement benefits are available. 

k

Houston provides a lump-sum payment of $5,000 to most firefighters retiring on either disability

retirement or normal retirement. An additional annual retirement benefit is also provided depending 

on the monthly payment and length of time retired. Due to variability from year-to-year and person-toperson, this additional benefit is not included in these calculations. (See app. II, City of Houston 

Firefighters, for details.) 

l

Benefits are offset, unless the injury is combat related. (See app. II, military personnel, for details.) 

m

Under FERS, if a PSO qualifies for normal service retirement (age 50 with 20 years of service, or 

any age with 25 years of service), the disability retirement benefit included here is calculated using 

the same formula as normal service retirement. However, the officer would not receive a special 

retirement supplement provided only to those taking normal service retirement. Therefore, a federal 

PSO age 55 with 32 years of service would receive greater benefits by taking normal retirement 

rather than disability retirement. 

n

In Newark, the disability benefit included here does not change based on age or length of service. 

Therefore, a firefighter with 32 years of service would receive greater benefits by taking normal 

retirement (calculated at 65% of salary plus 1% for each year of service over 25, up to 30), rather 

than disability retirement. 

Page 103 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Table 12: Benefits Provided for Quadriplegia and Other Permanent Total Disabilities 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

Age 20, 1 year of service, salary of $20,000 

Military personnel 

• With SMC for 

quadriplegiac

 

$6,576 $1,250 Retirement offset 

dollar-for-dollar 

$6,576 Not 

applicable 

21.247 $1,676,664

• Without SMC $2,299 $1,250 Retirement offset 

dollar-for-dollar 

$2,299 Not 

applicable 

21.247 $586,170

Federal PSOs

• With attendant 

allowance 

$2,611 (total 

disability)d

0e

Not applicable $2,611 $275,658 21.247 $941,377

• Without 

attendant 

allowance 

$1,111 (total 

disability)d

0e

Not applicable $1,111 $275,658 21.247 $558,927

Selected state PSOs 

• California 

Highway 

Patrol 

$3,640 $833 No offset $4,473 $275,658 21.247 

(compensation)

18.168 

(retirement) 

$1,385,342

• Florida 

Highway 

Patrol 

$1,111 to age 75 $1,083 Compensation 

offset if combined 

amount is greater 

than 100% of preinjury wage 

$1,667 to 

age 75

$1,083 

thereafter 

$275,658 17.413

(compensation to 

age 62)

f

0.657 

(compensation

age 62 to 75) 

18.168 

(retirement) 

$638,405

• Indiana State 

Police 

Not applicable $1,667 until 

25 years of 

serviceg

$833 

thereafter 

Not applicable $1,667 for 

24 years 

$833 

thereafter 

$275,658 20.373

(for 24 years) 

8.283 

(thereafter) 

$766,003

• Montana 

Highway 

Patrol 

$1,111 $833 Cannot be 

received 

concurrently 

$1,111 $275,658 21.247 $558,927

Page 104 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

• New Jersey 

State Police 

$1,167 $1,111 Retirement offset 

dollar-for-dollar

$1,167 $275,658 13.924

(compensation)

18.168 

(retirement) 

$470, 650

• Texas State 

Troopers 

$1,250 $1,667 No offset $2,917 $275,658 18.168

(compensation)

13.924 

(retirement) 

$826,708

Selected local PSOs 

• Los Angeles 

Firefighters 

$3,640 $1,500 Cannot be 

received 

concurrently 

$3,640 $275,658 21.247 $1,203,739

• Miami 

Firefighters 

$1,111 $1,111 Compensation 

offset if combined 

amount is greater 

than 100% of preinjury wage 

$1,667 $275,658h

18.168 $639,084

• Indianapolis 

Firefighters 

Not applicable $1,500 to 

age 52

$1,233 

thereafteri

Not applicable $1,500 to 

age 52

$1,233 

thereafter 

$275,658 15.984

(to age 52) 

2.184 

(thereafter) 

$595,679

• Billings 

Firefighters 

$1,111 $833 Cannot be 

received 

concurrently 

$1,111 $275,658 21.247 $558,927

• Newark 

Firefighters 

$1,167 $1,111 Retirement offset 

dollar-for-dollar

$1,167 $275,658 13.924

(compensation)

18.168 

(retirement) 

$470, 650

• Houston 

Firefighters 

$1,250 $1,400 No offset $2,650 $275,658 

plus $5,000j

18.168 $858,389

Age 25, 6 years of service, salary of $40,000 

Military personnel 

• With SMC for 

quadriplegiac

 

$6,576 $2,500 Retirement offset 

dollar-for-dollar

$6,576 Not

applicable 

19.444 $1,534,391

• Without SMC $2,299 $2,500 Retirement offset 

dollar-for-dollar

$2,500 Not

applicable 

19.444 $583,330

Page 105 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

Federal PSOs 

• With attendant 

allowance 

$3,722 (schedule 

award for 23

years, total 

disability 

thereafter)d,k

$2,000 for 

first year 

$1,333 to 

age 62

$1,577 

thereafter 

Schedule award 

and retirement 

can be received

concurrently with 

no offset; total 

disability and 

retirement cannot 

be received 

concurrently 

$5,722 for 

first year 

$5,055 for 

next 22 

years 

$3,722 

thereafter 

$275,658 19.444

(compensation)

0.972 

(retirement first 

year) 

12.152 

(retirement for 

next 22 years)

$1,361,822 

• Without 

attendant 

allowance 

$2,222 (total 

disability)d

$2,000 for 

first year 

$1,333 to 

age 62

$1,577 

thereafter 

Total disability 

and retirement 

cannot be 

received 

concurrently 

$2,222 $275,658 19.444 $794,122

Selected state PSOs 

• California 

Highway 

Patrol 

$3,640 $1,667 No offset $5,307 $275,658 19.444

(compensation)

16.800 

(retirement) 

$1,461,057

• Florida 

Highway 

Patrol 

$2,222 to age 75 $2,167 Compensation 

offset if combined 

amount is greater 

than 100% of preinjury wage 

$3,333 to 

age 75

$2,167 

thereafter 

$275,658 15.828

(compensation to 

age 62)

f

0.855 

(compensation

age 62 to 75) 

16.800 

(retirement) 

$945,957

• Indiana State 

Police 

Not applicable $3,333 until 

25 years of 

service 

$1,667 

thereafterg

Not applicable $3,333 for 

19 years 

$1,667 

thereafter 

$275,658 15.188

(for 19 years) 

8.366 

(thereafter) 

$1,050,449

• Montana 

Highway 

Patrol 

$2,222 $1,667 Cannot be 

received 

concurrently 

$2,222 $275,658 19.444 $794,122

• New Jersey 

State Police 

$2,333 $2,222 Retirement offset

dollar-for-dollar

$2,333 $275,658 13.075

(compensation)

16.800 

(retirement) 

$641,706

Page 106 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

• Texas State 

Troopers 

$2,336 $3,333 No offset $5,669 $275,658 16.800

(compensation)

13.075 

(retirement) 

$1,269,548

Selected local PSOs 

• Los Angeles 

Firefighters 

$3,640 $3,000 Cannot be 

received 

concurrently 

$3,640 $275,658 19.444 $1,124,987

• Miami 

Firefighters 

$2,222 $2,222 Compensation 

offset if combined 

amount is greater 

than 100% of preinjury wage 

$3,333 $275,658h16.800 $947,597

• Indianapolis 

Firefighters 

Not applicable $3,000 to 

age 52

$2,467 

thereafteri

Not applicable $3,000 to 

age 52

$2,467 

thereafter 

$275,658 14.164 

(to age 52) 

2.636 

(thereafter) 

$863,605

• Billings 

Firefighters 

$2,222 $1,667 Cannot be 

received 

concurrently 

$2,222 $275,658 19.444 $794,122

• Newark 

Firefighters 

$2,333 $2,222 Retirement offset

dollar-for-dollar

$2,333 $275,658 13.075

(compensation)

16.800 

(retirement) 

$641,706

• Houston 

Firefighters 

$2,336 $2,650 No offset $4,986 $275,658 

plus $5,000j

16.800 $1,285,844

Age 35; 12 years of service, salary of $60,000 

Military personnel 

• With SMC for 

quadriplegiac

 

$6,576 $3,750 Retirement offset

dollar-for-dollar

$6,576 Not

applicable 

16.018 $1,264,041

• Without SMC $2,299 $3,750 Retirement offset 

dollar-for-dollar

$3,750 Not

applicable 

16.018 $720,826

Federal PSOs

• With attendant 

allowance 

$4,833 (schedule 

award for 23

years, total 

disability 

thereafter)d,k 

$3,000 for 

first year 

$2,000 to 

age 62

$2,145 

thereafter 

Schedule award 

and retirement 

can be received

concurrently with 

no offset; total 

disability and 

retirement cannot 

be received 

concurrently 

$7,833 for 

first year 

$6,833 for 

next 22 

years 

$4,833 

thereafter 

$275,658 16.018

(compensation)

0.962 

(retirement for 

first year) 

10.937 

(retirement for 

next 22 years)

$1,501,789

Page 107 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

• Without 

attendant 

allowance 

$3,333 (total 

disability)d

 

$3,000 for 

first year 

$2,000 to 

age 62

$2,145 

thereafter 

Total disability 

and retirement 

cannot be 

received 

concurrently 

$3,333 $275,658 16.018 $916,329

Selected state PSOs 

• California 

Highway 

Patrol 

$3,640 $2,500 No offset $6,140 $275,658 16.018

(compensation)

14.144 

(retirement) 

$1,399,667

• Florida 

Highway 

Patrol 

$2,821 to age 75 $3,250 Compensation 

offset if combined 

amount is greater 

than 100% of preinjury wage 

$5,000 to 

age 75

$3,250 

thereafter 

$275,658 12.683

(compensation to 

age 62)

f

1.285 

(compensation

age 62 to 75) 

14.144 

(retirement) 

$1,120,613

• Indiana State 

Police 

Not applicable $5,000 until 

25 years of 

service 

$2,500 

thereafterg

Not applicable $5,000 for 

13 years 

$2,500 

thereafter 

$275,658 10.258

(for 13 years) 

7.102 

(thereafter) 

$1,104,153

• Montana 

Highway 

Patrol 

$2,253 $2,500 Cannot be

received 

concurrently 

$2,500 $275,658 14.144 $699,985

• New Jersey 

State Police 

$2,886 $3,333 Retirement offset

dollar-for-dollar

$3,333 $275,658 11.380

(compensation)

14.144 

(retirement) 

$745.645

• Texas State 

Troopers 

$2,336 $5,000 No offset $7,336 $275,658 14.144

(compensation)

11.380 

(retirement) 

$1,354,958

Selected local PSOs 

• Los Angeles 

Firefighters 

$3,640 $4,500 Cannot be 

received 

concurrently 

$4,500 $275,658 14.144 $1,039,446

Page 108 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

• Miami 

Firefighters 

$2,821 $3,333 Compensation

offset if combined 

amount is greater 

than 100% of preinjury wage 

$5,000 $275,658h14.144 $1,124,312

• Indianapolis 

Firefighters 

Not applicable $4,500 to 

age 52

$3,400 

thereafteri

Not applicable $4,500 to 

age 52

$3,400 

thereafter 

$275,658 10.181

(to age 52) 

3.963 

(thereafter) 

$987,133

• Billings 

Firefighters 

$2,253 $2,500 Cannot be

received 

concurrently 

$2,500 $275,658 14.144 $699,985

• Newark 

Firefighters 

$2,886 $3,333 Retirement offset

dollar-for-dollar

$3,333 $275,658 11.380

(compensation)

14.144 

(retirement) 

$745.645

• Houston 

Firefighters 

$2,336 $3,900 No offset $6,236 $275,658 

plus $5,000j

14.144 $1,339,099

Age of 45, 22 years of service, salary of $85,000 

Military personnel 

• With SMC for 

quadriplegiac

 

$6,576 $5,313 No offset

(because 20 or

more years of 

service and a 

100% disability 

rating) 

$11,889 Not

applicable 

13.166 $1,878,409

• Without SMC $2,299 $5,313 No offset 

(because 20 or

more years of 

service and a 

100% disability 

rating) 

$7,612 Not

applicable 

13.166 $1,202,662

Page 109 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

Federal PSOs

• With attendant 

allowance 

$6,222 (schedule 

award for 23

years, total 

disability 

thereafter)d,k

$4,250 for 

first year 

$2,833 to 

age 62

$3,039 

thereafter 

Schedule award 

and retirement 

can be received

concurrently with 

no offset; total 

disability and 

retirement cannot 

be received 

concurrently 

$10,472 for 

first year 

$9,055 for 

next 16 

years (to 

age 62) 

$9,261 for 

next 6 years 

$6,222 

thereafter 

$275,658 13.166

(compensation)

0.950 

(retirement for 

first year) 

8.489 

(retirement for 

next 16 years)

0.510 

(retirement for 

next 6 years) 

$1,614,340

• Without 

attendant 

allowance 

$4,722 (total 

disability)d

$4,250 for 

first year 

$2,833 to 

age 62

$3,039 

thereafter 

Total disability 

and retirement 

cannot be 

received 

concurrently 

$4,722 $275,658 13.166 $1,021,713

Selected state PSOs 

• California 

Highway 

Patrol 

$3,640 $3,542 No offset $7,182 $275,658 13.166

(compensation)

11.874 

(retirement) 

$1,355,433

• Florida 

Highway 

Patrol 

$2,821 to age 75 $4,604 Compensation 

offset if combined 

amount is greater 

than 100% of preinjury wage 

$7,083 to 

age 75

$4,604 

thereafter 

$275,658 9.435

(compensation to 

age 62)

f

2.145 

(compensation

age 62 to 75) 

11.874 

(retirement) 

$1,276,114

• Indiana State 

Police 

Not applicable $7,083 until 

25 years of 

service 

$3,542 

thereafterg

Not applicable $7,083 for 3 

years 

$3,542 

thereafter 

$275,658 2.680

(for 3 years) 

10.744 

(thereafter) 

$960,144

• Montana 

Highway 

Patrol 

$2,253 $3,896 Cannot be

received 

concurrently 

$3,896 $275,658 11.874 $830,768

Page 110 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

• New Jersey 

State Police 

$2,886 $4,722 Retirement offset

dollar-for-dollar

$4,722 $275,658 9.877

(compensation)

11.874 

(retirement) 

$879,323

• Texas State 

Troopers 

$2,336 $7,083 No offset $9,419 $275,658 11.874

(compensation)

9.877 

(retirement) 

$1,448,021

Selected local PSOs 

• Los Angeles 

Firefighters 

$3,640 $6,375 Cannot be

received 

concurrently 

$6,375 $275,658 11.874 $1,183,981

• Miami 

Firefighters 

$2,821 $4,722 Compensation

offset if combined 

amount is greater 

than 100% of preinjury wage 

$7,083 $275,658h

11.874 $1,284,858

• Indianapolis 

Firefighters 

Not applicable $6,375 to 

age 52

$4,817 

thereafteri

Not applicable $6,375 to 

age 52

$4,817 

thereafter 

$275,658 5.254

(to age 52) 

6.620 

(thereafter) 

$1,060,213

• Billings 

Firefighters 

$2,253 $3,896 Cannot be

received 

concurrently 

$3,896 $275,658 11.874 $830,768

• Newark 

Firefighters 

$2,886 $4,722 Retirement offset

dollar-for-dollar

$4,722 $275,658 9.877

(compensation)

11.874 

(retirement) 

$879,323

• Houston 

Firefighters 

$2,336 $5,462 No offset $7,798 $275,658 

plus $5,000j

 

11.874 $1,391,733

Age 55, 32 years of service, salary of $85,000 

Military personnel 

• With SMC for 

quadriplegiac

 

$6,576 $5,313 No offset

(because 20 or

more years of 

service and a 

100% disability 

rating) 

$11,889 Not

applicable 

10.931 $1,559,445

Page 111 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

• Without SMC $2,299 $5,313 Not

applicable 

No offset 10.931 $998,444

(because 20 or

more years of 

service and a 

100% disability 

rating) 

$7,612

Federal PSOs

• With attendant 

allowance 

$6,222 (schedule 

award for 23

years, total 

disability 

thereafter)d,k

$3,258l

Schedule award

and retirement 

can be received

concurrently with 

no offset; total 

disability and 

retirement cannot 

be received 

concurrently 

9.594 

(retirement for 23 

years) 

$9,480 for 

23 years 

$6,222 

thereafter 

$275,658 10.931

(compensation)

$1,466,866

• Without 

attendant 

allowance 

$4,722 (total 

disability)d

 

$3,258 Total disability

and retirement 

cannot be 

received 

concurrently 

$4,722 $275,658 10.931 $895,029

Selected state PSOs 

• California 

Highway 

Patrol 

$3,640 $6,375 No offset $10,015 $275,658 10.931

(compensation)

$1,522,015

10.051 

(retirement) 

• Florida 

Highway 

Patrol 

$2,821 to age 75 $6,800 Compensation 

offset if combined 

amount is greater 

than 100% of preinjury wage 

$7,083 to 

age 75

$6,800 

thereafter 

$275,658 5.170

(compensation to 

age 62)

f

4.292 

(compensation

age 62 to 75) 

10.051 

(retirement) 

$1,127,960

• Indiana State 

Police 

Not applicable $7,083 for 2 

years 

$3,542 

thereafterm 

$3,542 

thereafter 

$275,658

9.358 

(thereafter) 

Not applicable $7,083 for 2 $831,826

years 

1.864

(for 2 years) 

• Montana 

Highway 

Patrol 

$2,253 $5,667 Cannot be

received 

concurrently 

$5,667 $275,658 10.051 $959,173

Page 112 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

Hypothetical

individuals, by

occupation 

Disability 

compensation

monthly benefit 

Disability 

retirement 

monthly

benefit 

Compensation

and retirement 

offset 

provisions 

Combined 

monthly

benefit 

Lump-sum 

benefits, if 

applicablea

Annuity factorsb

Present value

of lifetime 

package of

benefits

(Table 12: Quadriplegia—continued)

• New Jersey 

State Police 

$2,886 $4,722 Retirement offset

dollar-for-dollar

$4,722 $275,658 8.632

(compensation)

10.051 

(retirement) 

$796,056

• Texas State 

Troopers 

$2,336 $7,083 $9,419 $275,658 10.051

(compensation)

8.632 

(retirement) 

No offset $1,291,118

Selected local PSOs 

• Los Angeles 

Firefighters 

$3,640 $6,375 Cannot be

received 

concurrently 

$6,375 $275,658 10.051 $1,044,567

• Miami 

Firefighters 

$2,821 $4,722 Compensation 

offset if combined 

amount is greater 

than 100% of preinjury wage 

$7,083 $275,658h

10.051 $1,129,961

• Indianapolis 

Firefighters 

Not applicable $5,242iNot applicable $5,242 $275,658 10.051 $907,913

• Billings 

Firefighters 

$2,253 $5,667 Cannot be $5,667 $275,658 10.051 $959,173

received 

concurrently 

• Newark 

Firefighters 

$2,886 $4,722nRetirement offset

dollar-for-dollar

10.051 

(retirement) 

$4,722 $275,658 8.632

(compensation)

$796,056

• Houston 

Firefighters 

$2,336 $5,817 No offset $8,153 $275,658 

plus $5,000j

10.051 $1,264,018

Source: GAO analysis based on program provisions summarized in apps. I and II. 

a

Unless noted otherwise, the lump-sum benefit included below is the payment available under the 

U.S. Department of Justice’s Public Safety Officers’ Benefits Program for PSOs at the federal, state, 

and local levels who incur total permanent disabilities in the line of duty. (See app. III for details.)

d

Under FECA, compensation payments are calculated on a 28-day cycle; converted to a monthly 

payment here to facilitate comparison with other programs’ payments.

e

Under FERS, 18 months of service are required to qualify for disability retirement benefits. 

b

Annuity factors take into account mortality rates, discount rates, and cost-of living adjustments, as

appropriate. Where different provisions or changes in benefits over time require different annuity 

factors, the factors are used proportionately as appropriate. 

c

According to VA officials, a veteran with quadriplegia would qualify for the SMC rate of R-2 (the 

highest compensation rate provided) for loss of use of multiple extremities and in need of a high level

of care. 

Page 113 GAO-06-4 Disability Benefits
Appendix IV: Hypothetical Scenarios and 

Calculation of Lifetime Disability Benefits—

Methods and Results 

f

In Florida, the COLA for permanent total disability compensation benefits ends at age 62. 

g

In Indiana, disability retirement benefits are provided until the date the officer is credited with 25 

years of service, including years on disability. Then, benefits are recalculated as normal service 

retirement benefits. 

h

Miami provides a lump-sum benefit available to firefighters upon retirement, in an amount that varies 

depending on several factors that we were not able to estimate; thus, the benefit is not included in 

these calculations. 

i

In Indianapolis, when the former firefighter reaches age 52, disability retirement benefits are 

recalculated based on the formula for normal service retirement. If already age 52 or older when

applying for retirement due to disability, only normal service retirement benefits are available. 

k

For federal PSOs, combined compensation and retirement benefits are maximized by receiving a 

schedule award as long as possible (which can be received concurrently with no offset), followed by 

total disability (which is greater than the retirement payment under FERS, and cannot be received 

concurrently). The schedule award for quadriplegia is calculated as four consecutive awards for each 

loss of use of a limb: 312 weeks plus 312 weeks (for each arm) and 288 weeks plus 288 weeks (for 

each leg) equals 1200 weeks total (approximately 23 years). 

l

Under FERS, if a PSO qualifies for normal service retirement (age 50 with 20 years of service, or any 

age with 25 years of service), the disability retirement benefit included here is calculated using the 

same formula as normal service retirement. However, the officer would not receive a special 

retirement supplement provided only to those taking normal service retirement. Therefore, a federal 

PSO age 55 with 32 years of service would receive greater benefits by taking normal retirement 

rather than disability retirement. 

m

In Indiana, when an officer already qualifies for normal service retirement at the time a catastrophic 

disability occurs, the officer receives retirement payments of 100% of pay for 2 years, then benefits

are recalculated as normal service retirement benefits. However, we were unable to confirm with 

officials whether or not an officer in this situation would be provided the added increments for having 

more than 25 years of service, as provided under normal service retirement. In our hypothetical 

scenario for the officer age 55 with 32 years of service, the added increments for the 7 years of 

service over 25, plus the 2 years receiving disability pay, would increase the monthly payment upon 

retirement from $3,542 to $5,560, and the present value of lifetime package of benefits would be 

$1,058,434. 

n

In Newark, the disability benefit included here does not change based on age or length of service. 

Therefore, a firefighter with 32 years of service would receive greater benefits by taking normal 

retirement (calculated at 65% of salary plus 1% for each year of service over 25, up to 30), rather 

than disability retirement. 

j

Houston provides a lump-sum payment of $5,000 to most firefighters retiring on either disability

retirement or normal retirement. An additional annual retirement benefit is also provided depending 

on the monthly payment and length of time retired. Due to variability from year-to-year and person-toperson, this additional benefit is not included in these calculations. (See app. II, City of Houston 

Firefighters, for details.) 

Page 114 GAO-06-4 Disability Benefits
Appendix V: Impact of Varying Salary Levels 

on Monthly Benefit Payments 

In our analysis, we held salaries for military personnel and civilian PSOs 

constant to be able to characterize the differences in how payment 

amounts are calculated across the various programs. However, the actual 

salaries vary by occupation, and salaries paid to civilian PSOs in 

comparable occupations vary widely from state to state. The Bureau of 

Justice Statistics collects state-level data on various law enforcement 

occupations, including salary levels. According to the most recent data 

available, for example, annual base salaries for entry level state police 

officers in 2000 ranged from a low of $21,063 in Florida to a high of 

$45,696 in Alaska. Salaries for a police chief or sheriff ranged from a low 

of $40,000 in Montana to a high of $127,000 in New York.1

 Table 13 

summarizes actual salary levels in 2000 for three levels of experience for 

military servicemembers, federal FBI agents, and for state police officers 

in the six states included in our review. 

Table 13: Base Annual Starting Salaries by Occupation and Experience Level, 2000 

Occupation Entry level Midlevel Senior level

Military personnel

a

 Enlisted member Warrant officer Commissioned officer

Appendix V: Impact of Varying Salary Levels 

on Monthly Benefit Payments 

$13,529 $30,272 $84,186

Trainee

(GS-10)

Field, non-supervisory position 

 (GS-13) 

Supervisory/management position 

Selected federal PSO (GS-14)

• FBI agent $35,658 $55,837 $65,983

Selected state PSOs Entry-level officer Sergeant Chief or sheriff

• California Highway Patrol $42,600 $51,804 $117, 960

• Florida Highway Patrol $21,063 $26,084 $56,484

• Indiana State Police $28,804 $33,758 $78,258

• Montana Highway Patrol $23,000 $31,000 $40,000

• New Jersey State Police $39,255 $51,393 $104,202

• Texas State Troopers $29,000 $43,400 $78,258

Sources: Department of Defense, Office of Personnel Management, and Department of Justice. 

a For military personnel, the entry level salary is that of an E-2 enlisted member with less than 2 years

of service, the midlevel salary is that of a W-1 warrant officer with over 12 years of service, and the 

senior level salary is that of an O-6 commissioned officer with over 26 years of service. 

 1

See B. A. Reaves, Law Enforcement Management and Administrative Statistics, 2000: 

Data for Individual State and Local Agencies with 100 or More Officers. U.S. Department 

of Justice, Office of Justice Programs, Bureau of Justice Statistics. March 2004, NCH 

203350, 246. 

Page 115 GAO-06-4 Disability Benefits
Appendix V: Impact of Varying Salary Levels 

on Monthly Benefit Payments 

To indicate how the difference between hypothetical and actual salary 

levels would affect disability benefits provided, we compared the monthly 

disability compensation and retirement payments generated in our 

hypothetical scenarios for entry level ($20,000), midlevel ($60,000), and 

senior level ($85,000) salaries, with the payment amounts that would be 

generated based on the actual salaries in table 13 (assuming the same age 

and length of service as in the corresponding hypothetical scenario). As 

shown in table 14, the difference in monthly temporary compensation 

payments based on the hypothetical salary levels compared with the actual 

salary levels is relatively minor, in most cases, due to the use of a set 

amount based on the disability rating (as in the military), or due to the 

imposition of caps on maximum payment amounts in several states based 

on the statewide average wage. 

Table 14: Monthly Temporary Compensation Payments Based on Actual versus Hypothetical Salary Levels 

Entry level Mid level Senior level 

Disability Benefits

Payment based on 

actual entry level 

starting salary in

2000 

Payment based on 

hypothetical salary 

of $20,000 

Payment based 

on actual 

midlevel starting

salary in 2000

Payment based 

on hypothetical

salary of $60,000 

Payment based

on senior level 

starting salary 

in 2000

Payment based 

on hypothetical

salary of 

$85,000

Military personnel

a

Set amount based 

on disability rating 

(same) (same) (same) (same) (same)

Federal FBI agent $1,961 $1,111 $3,102 $3,333 $3,666 $4,722

Selected state PSOs 

• California 

Highway Patrolb

$3,640 $3,640 $3,640 $3,640 $3,640 $3,640

• Florida Highway

Patrol $1,170 $1,111 $1,449 $2,821c

$2,821c$2,821c

• Indiana State 

Policed

Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable

• Montana Highway

Patrol $1,278 $1,111 $1,722 $2,253c $2,222 $2,253c

• New Jersey State 

Police $2, 290 $1,167 $2,886c

$2,886c$2,886c$2,886c

• Texas State 

Troopers $1,692 $1,167 $2,336c $2,336c $2,336c $2,336c

Source: GAO analysis based on data in table 13, program summaries in app. I, and the hypothetical scenarios in app. IV. 

a

VA compensation benefits for military personnel do not differentiate between temporary and 

permanent disability. 

b

In California, statutes call for PSOs to be paid the maximum allowable payment, regardless of actual

earnings. 

c

Based on a payment cap. 

Page 116 GAO-06-4
Appendix V: Impact of Varying Salary Levels 

on Monthly Benefit Payments 

d

Indiana State Police do not receive compensation payments from the state’s workers’ compensation 

program. 

In contrast, disability retirement payments are generally calculated as a 

percentage of pre-injury salary with more generous caps on maximum 

payment amounts, if any. As a result, the difference in disability retirement 

payments based on the hypothetical salary levels compared with the actual 

salary levels is much more significant, as shown in table 15. Those earning

lower wages than in the hypothetical scenarios receive much lower 

disability retirement payments, and those earning higher wages than in the 

hypothetical scenarios receive much higher disability retirement 

payments. 

Table 15: Monthly Disability Retirement Payments Based on Actual versus Hypothetical Salary Levels 

Entry level Mid level Senior level 

Payment based 

on 

hypothetical 

salary of 

$20,000 

Payment based 

on senior level 

starting salary in

2000

Payment based on 

actual midlevel 

starting salary in

2000

Payment based 

on actual entry 

level starting

salary in 2000

Payment based 

on hypothetical

salary of $85,000

Payment based on 

hypothetical salary 

of $60,000 

Military personnel

a $338 $500 $757 $1,500 $5,262 $5,313

Federal FBI agentb $1,189 $667 $1,861 $2,000 $2,529 $3,258

Selected state PSOs 

• California Highway 

Patrol $1,775 $833 $2,159 $2,500 $8,847c

$6,375c

• Florida Highway

Patrol $1,141 $4,519c $6,800c $1,083 $1,413 $3,250

• Indiana State 

Policec

$1,200 $833 $1,407 $2,500 $3,261 $3,542

• Montana Highway

Patrol $2,500 $2,667c

$5,667c $958 $833 $1,292

• New Jersey State 

Police $2,181 $1,111 $2,855 $3,333 $5,789 $4,722

• Texas State 

Troopers $2,500 $5,843c $6,347c $1,208 $833 $1,808

Source: GAO analysis based on data in table 13, program summaries in app. II, and the hypothetical scenarios in app. IV. 

a

Military personnel can elect to have their retirement payments calculated based on average high-3

salary times either (1) 2.5% for each year of service or (2) their disability rating. In this table, we 

assumed the disability rating to be 30%, the lowest rating that qualifies for disability retirement. 

Nevertheless, use of the formula with the disability rating provides the higher monthly retirement 

benefit for the entry-level servicemember, and the same monthly benefit as the years of service 

formula for the midlevel servicemember, with respect to both the hypothetical and actual salaries. 

b

Payments shown here for FBI agents are based on 40% of average high-3 salary, which is the

payment level provided after the first year of benefits until reaching age 62. (During the first year, 

payments are 60% of average high-3 salary; after age 62, payments are 1.0% times high-3 average 

salary times years and months of service.) 

Page 117 GAO-06-4 Disability Benefits
Appendix V: Impact of Varying Salary Levels 

on Monthly Benefit Payments 

c

Eligible for enhanced payments due to age or length of service. 

d

Payments shown here for Indiana State Police are based on 50% of average high-3 salary, which is 

the payment level provided after the first 2 years. (During the first 2 years, payments are 70% of 

average high-3 salary.) 

Page 118 GAO-06-4 Disability Benefits
A

of Disabilit

ppendix VI: Federal Income Tax Treatment

y Benefits 

Page 119 GAO-06-4

Provisions in 26 U.S.C. § 104(a) set forth the types of disability benefits 

that may be excluded from gross income subject to federal income tax. 

These include, among others: 

• amounts received under workmen’s compensation acts as 

compensation for personal injuries or sickness and 

• amounts received as a pension, annuity, or similar allowance for 

personal injuries or sickness resulting from active service in the armed 

forces if due to combat-related injuries.1

The federal tax treatment of the disability benefits examined in this report 

is based on whether the benefits received fall within the categories set 

forth in 26 U.S.C. § 104(a), as discussed below. 

Amounts received as workers’ compensation for an occupational sickness 

or injury are fully exempt from federal income tax if they are paid under a 

workers’ compensation act or a statute in the nature of a workers’ 

compensation act. Disability compensation payments from VA (for 

military veterans) and from FECA (for federal PSOs) fall under this 

category and are not taxable. Across all programs we reviewed, we found 

workers’ compensation benefits and disability compensation benefits 

treated as federally tax-exempt. 

Individuals who retire on disability must include as taxable income any 

disability pension received under a plan that is paid for by the employer.2

 If 

a disability pension is paid under a statute that provides benefits only to 

employees with service-connected disabilities, the part based on level of

disability may be considered workers’ compensation, exempt from tax. 

The part based on years of service, however, is taxable. Since the disability 

retirement programs we reviewed varied as to whether only those with 

service-connected disabilities were included, and whether the benefits 

were calculated based on level of disability or years of service, we found 

Appendix VI: Federal Income Tax Treatment 

of Disability Benefits 

Disability Compensation 

Benefits 

Disability Retirement 

Benefits 

 1

Combat-related injury is defined as personal injury or sickness that is incurred as a direct 

result of armed conflict, while engaged in extra-hazardous service, or under conditions

simulating war; or that is caused by an instrumentality of war. 

2

However, individuals who have limited income and are retired on permanent and total 

disability, and who have taxable disability income, may qualify for a tax credit entitled 

Credit for the Elderly or the Disabled. 

Disability Benefits
Appendix VI: Federal Income Tax Treatment

of Disability Benefits 

the tax treatment of disability retirement benefits varied among the 

programs. 

In general, military disability retirement pay is subject to federal income 

tax unless the servicemember’s disabilities are combat-related. In addition 

military disability retirement pay is not subject to federal income tax if the 

member was entitled to receive a disability payment before September 24, 

1975; or on active duty, a member of a reserve component, or under a 

binding written commitment to be a member on September 25, 1975. 

Finally, if the veteran would have been entitled to receive VA

compensation benefits, the amount of retirement benefits that would have 

been received if calculated based on a percentage of disability (that is, the 

amount of VA compensation benefits) is not subject to federal income tax.

The disability retirement program for federal PSOs (FERS) does not 

distinguish between work-related and non-work-related disability, and 

disability retirement benefits are treated as taxable. 

Among the selected state and local PSOs we reviewed, the tax treatment 

of disability retirement benefits varies. Some program officials, such as 

those providing benefits to Montana Highway Patrol Officers, Billings 

Firefighters, and Texas State Troopers, told us that their disability 

retirement payments are subject to federal income tax. Other program 

officials, such as those providing benefits to California and Florida 

Highway Patrol Officers, and Houston and Los Angeles Firefighters, told 

us that the portion of their disability retirement payment based on 

disability is federally tax-exempt, but any additional amount based on 

years of service is taxable. Officials providing benefits to Miami 

Firefighters told us that their disability retirement benefits are treated as 

federally tax-exempt. Still other program officials, such as those providing 

benefits to Indiana and New Jersey State Police, and Indianapolis 

Firefighters, told us that their disability retirement benefits are treated as 

tax-exempt only for the period of time until the PSO reaches normal 

retirement age, at which point benefits are treated as federally taxable the 

same as normal retirement benefits. 

Pay received from an employer while an employee is sick or injured is part 

of salary or wages and should be included as taxable income. Among the 

programs we reviewed, for the most part, program officials told us that 

Continuation of Pay 

Page 120 GAO-06-4 Disability Benefits
Appendix VI: Federal Income Tax Treatment

of Disability Benefits 

continuation of pay and/or sick leave provided following a line of duty 

injury is subject to federal income tax the same as if the injured person 

were still working,3

 with one exception. In California, program officials 

providing benefits to State Highway Patrol Officers and to Los Angeles 

Firefighters told us that continuation of pay is treated as federally taxexempt based on a court decision and an Internal Revenue Service 

revenue ruling.4

 3

Certain military personnel serving in a combat zone may qualify to have their pay excluded 

from gross income subject to federal taxes, including pay received while hospitalized as a 

result of wounds, disease, or injury incurred in the combat zone for up to 2 years after 

leaving the zone. 

4

Hawthorne v. City of Beverly Hills, 245 P. 2.d, 352 (1952); Rev. Rul. 68-10, 1968-1 C.B. 50; 

and Priv. Ltr. 7920009 (Feb. 13, 1979). 

Page 121 GAO-06-4 Disability Benefits
Appendix VII: Progression of Disability 

Benefits Following a Line-of-Duty Injury, by Appendix VII: Progression of Disability Occupation 

Benefits Following a Line-of-Duty Injury, by 

Occupation 

Temporary disability: period 

of treatment, recovery, and 

evaluation Æ

Decision point about 

permanent effects of

disability and ability to 

return to duty Æ

Line-of-duty injury

occurs, by

occupation Æ

Military benefits, including: 

Page 122 GAO-06-4 Disability Benefits

Military personnel 

• Continuation of pay for 

generally no longer than a 

year, followed by Temporary 

Disability Retirement for up 

to 5 years, including VA 

compensation benefits.a

• Medical treatment for injury. 

Based on: 

• Attainment of optimal 

medical treatment benefits. 

• Physician assessment of 

disability rating and whether 

fit/unfit for duty. 

• Time period for Temporary 

Disability Retirement 

expires. 

FECA benefits including: Based on: 

• Continuation of pay up to 45 

days, followed by a recurring

payment for wage loss 

(based on a percentage of 

pre-injury salary, up to a 

cap). 

• Medical treatment for injury. 

Federal PSOs

• Injury has reached 

“maximum medical 

improvement” (no time limit).

• Physician assessment 

whether able to return to 

previous job, or any job. 

Selected state and 

local PSOse

Employer/Workers’ 

compensation benefits, 

including: 

• Continuation of pay, and/or 

recurring payment (usually 

based on a percentage of 

salary, up to a cap).f

• Medical treatment for injury. 

Based on: 

• Injury has reached 

“maximum medical 

improvement” or is 

“permanent and stable;” or a 

set time limit has been 

reached. 

• Physician assessment of 

disability rating and whether 

able to return to previous 

job. 

• Availability of job offer from 

current employer. 
Appendix VII: Progression of Disability 

Benefits Following a Line-of-Duty Injury, by 

Occupation 

Continued benefits based on level of disability and ability to return to duty 

No continuing disability,

able to return to duty,

pre-injury salary 

resumes 

Permanent partial disability,

able to return to duty, preinjury salary resumes 

Permanent partial disability,

unable to return to duty

Permanent total disability,

unable to be gainfully employed

Benefits cease. Military benefits, including: Military benefits, including: 

• Disability retirement. 

VA benefits, including: 

• Medical treatment for injury. 

• Vocational rehabilitation.b

Military benefits, including: 

• Disability severance or 

retirement. 

VA benefits, including: 

• Monthly compensation

payment for the remainder of 

life. 

• Medical treatment for injury. 

• Monthly compensation payment 

for the remainder of life. 

Medical treatment for injury. 

• Various other enhanced 

benefits. 

• Vocational rehabilitation. 

Disability Benefits

Benefits cease. FECA benefits, including: 

• Specified amount for 

permanent impairments 

(schedule award). 

• Medical treatment for injury 

• Vocational rehabilitation. 

FERS benefits, including: 

• Disability retirement.c

FECA benefits, including: 

• Continued recurring payments

for wage loss, if applicable.d

• Specified amount for 

permanent impairments 

(schedule award). 

• Medical treatment for injury. 

• Vocational rehabilitation. 

FERS benefits, including: 

• Disability retirement.c

FECA benefits, including: 

• Continued recurring payments

for wage loss, if applicable.d

• Specified amount for permanent 

impairments (schedule award). 

• Medical treatment for injury. 

• Various other enhanced 

benefits. 

Benefits cease. Workers’ compensation benefits, 

including: 

• Permanent disability. 

compensation payment based

on disability rating (usually for 

a set time period and/or dollar 

amount). 

• Medical treatment for injury. 

• Vocational rehabilitation. 

Employer benefits, including: 

• Disability retirement. 

Employer benefits, including: 

• Disability retirement. 

Workers’ compensation benefits, 

including: 

• Recurring disability 

compensation payment for the 

remainder of life. 

Workers’ compensation benefits, 

including: 

• Disability compensation 

payment based on disability 

rating (usually for a set time 

period and/or dollar amount). 

• Medical treatment for injury. 

• Vocational rehabilitation. 

• Medical treatment for injury. 

• Various other enhanced 

benefits. 

Source: GAO analysis based on statutes, regulations, program policies, and interviews with program officials. 

a

No VA compensation benefits are provided until or unless the servicemember is released from 

military service. If receiving temporary disability retirement benefits, however, the servicemember is

considered temporarily released from service, with access to VA compensation benefits, with offsets,

as applicable. (See earlier background section for further details on offsets.) 

b

A servicemember pending medical separation from the military may apply for vocational rehabilitation 

services in advance of separation, but no VA compensation payments are provided until or unless the 

servicemember is released from military service. 

Page 123 GAO-06-4
Appendix VII: Progression of Disability 

Benefits Following a Line-of-Duty Injury, by 

Occupation 

c

Federal PSOs must have 18 months of service to qualify for disability retirement under FERS. Also, 

they can earn up to 80% of pre-injury salary and still qualify. 

d

Federal PSOs cannot receive wage loss compensation benefits concurrently with disability

retirement. However, if unable to qualify for disability retirement (for example, because cannot meet 

the 18-month service requirement, or because earning more than 80%, but less than 100%, of preinjury salary), FECA will continue to provide a percentage of the difference between old and new 

salaries, with no time limit. 

e

Based on a review of benefits available to selected state and local PSOs, including state police 

officers in California, Florida, Indiana, Montana, New Jersey, and Texas; and local firefighters in Los 

Angeles, Miami, Indianapolis, Billings, Newark, and Houston. 

f

In Indiana, state statutes allow some public employers to opt out of providing workers’ compensation 

payments, and we found that both the Indiana State Police and the Indianapolis Fire Department had 

opted out of such payments. Instead, after their special allocation of sick leave is exhausted, these

PSOs receive disability benefits only from their pension funds.

Page 124 GAO-06-4 Disability Benefits
Appendix VIII: Definitions of Total Disability

Page 125 GAO-06-4

Appendix VIII: Definitions of Total Disability 

Definitions are provided for programs reviewed that offer additional 

benefits for total disability. (Programs reviewed that do not distinguish 

between total disability and other types of disability are not included.) 

Compensation for ServiceConnected Disability,

Department of Veterans 

Affairs 

Federal Employees’ 

Compensation Act 

Social Security Disability 

Insurance 

“Total disability will be considered to exist when there is present any 

impairment of mind or body which is sufficient to render it impossible for 

the average person to follow a substantially gainful occupation.” 

Permanent total disability is presumed for loss or loss of use of both 

hands, both feet, one hand and one foot, sight in both eyes, or permanently 

helpless or bedridden. Any disability or combination of disabilities that 

rates 100 percent on the Schedule of Rating Disabilities qualifies for total 

disability. A total rating can also occur if injuries are less than 100 percent,

if it is “determined that the service-connected disabilities are sufficient to 

produce unemployability without regard to advancing age.” (38 C.F.R. §§ 

3.340, 3.341.)

Permanent total disability is presumptively loss of use of both hands, 

arms, feet, legs, eyes. “Temporary total disability is defined as the inability 

to return to the position held at the time of injury or earn equivalent 

wages, or to perform other gainful employment.” Disability is always 

presumed temporary unless it fits under the definition of permanent total

disability. (20 C.F.R. § 10.400.) 

“Disability means...inability to engage in any substantial gainful activity by 

reason of any medically determinable physical or mental impairment 

which can be expected to result in death or which has lasted or can be 

expected to last for a continuous period of not less than 12 months” (42 

U.S.C. § 423(d)(1)(A).) 

Permanent and total disability is “medically determinable consequences of 

a catastrophic, line-of-duty injury that permanently prevent a former 

public safety officer from performing any gainful work.” Catastrophic 

injury is one in which the “consequences of an injury...permanently 

prevent an individual from performing any gainful work.” (28 C.F.R. § 

32.2(h); 42 U.S.C. § 3796b.) 

Public Safety Officers’ 

Benefits Program, Bureau 

of Justice Assistance 

Disability Benefits
Appendix VIII: Definitions of Total Disability

Workers’ Compensation, 

California 

“Permanent total disability” means a permanent disability with a rating of

100 percent permanent disability only.” Loss or loss of use of both eyes, 

both hands, total paralysis, or severe brain injury are presumptively total 

and permanent. “In determining the percentages of permanent disability, 

account shall be taken of the nature of the physical injury or 

disfigurement, the occupation of the injured employee, and his or her age 

at the time of the injury, consideration being given to an employee’s 

diminished future earning capacity.” (Cal. Lab. Code §§ 4452.5, 4662, 

4660(a).) 

To qualify for permanent total disability benefits, an employee must be 

“not able to engage in at least sedentary employment.” (Fla. Stat. Ann. § 

440.15(1)(b).) 

Workers’ Compensation, 

Florida 

Disability Benefits, State 

Police, Indiana 

Workers’ Compensation, 

Montana 

Workers’ Compensation, 

New Jersey 

Disability Retirement for 

Law Enforcement, Texas 

Disability pension equal to full salary is provided for a “catastrophic” 

injury that “permanently prevents the Employee from performing any 

gainful work.” (Ind. Code Ann. § 10-12-2-5(d).) 

Permanent total disability benefits are available when there is a “physical

condition resulting from injury...in which a worker does not have a 

reasonable prospect of physically performing regular employment.” (Mont. 

Code Ann. § 39-71-116(25).) 

Permanent total disability benefits are available for “physical or 

neuropsychiatric total permanent impairment caused by a compensable 

accident or compensable occupational disease, where no fundamental or

marked improvement in such condition can be reasonably expected.” 

Agency officials interpret this as a person who cannot perform any 

occupation. (N.J. Stat. Ann. § 34.15-36.) 

An enhanced benefit of 100% of average monthly compensation is 

provided where “occupational disability makes the person incapable of

substantial gainful activity solely because of the disability and is 

considered a total disability under federal social security law.” (Tex. Gov’t

Code Ann. § 814.207(e).)

Page 126 GAO-06-4 Disability Benefits
Appendix VIII: Definitions of Total Disability

Lifetime income benefits are available for blindness in both eyes, loss of 

both feet or hands, other major amputations, spinal injuries, traumatic 

brain injuries, or burns. (Tex. Lab. Code Ann. § 408.161.) 

Workers’ Compensation, 

Texas

Page 127 GAO-06-4 Disability Benefits
Appendix IX: 

A

GAO Contacts and Staff 

cknowledgments 

Page 128 GAO-06-4 Disability Benefits

Cynthia A. Bascetta, Director (202) 512-7215 

Cristina T. Chaplain, Acting Director (202) 512-7215 

In addition, Carol Dawn Petersen, Assistant Director; Margie K. Shields, 

Analyst-in-Charge; and Diahanna L. Post, Thomas A. Radwick, and 

Peter E. Rumble were major contributors to this report. 

Joseph A. Applebaum, Chief Actuary; Kenneth J. Bombara, Senior 

Economist; and Daniel A. Schwimer, Deputy Assistant General Counsel, 

provided technical advice and support. 

Appendix IX: GAO Contacts and Staff 

Acknowledgments 

GAO Contacts 

Staff 

Acknowledgments 
Related GAO Products 

Page 129 GAO-06-4 Disability Benefits

Military Personnel: DOD Needs to Improve the Transparency and 

Reassess the Reasonableness, Appropriateness, Affordability, and 

Sustainability of Its Military Compensation System. GAO-05-798. 

Washington, D.C.: July 19, 2005. 

21st Century Challenges: Reexamining the Base of the Federal 

Government. GAO-05-325SP. Washington, D.C.: February 1, 2005. 

High-Risk Series: An Update. GAO-05-207. Washington, D.C.: January 1, 

2005. 

Military Personnel: Survivor Benefits for Servicemembers and Federal, 

State, and City Government Employees. GAO-04-814. Washington, D.C.: 

July 15, 2004.

VA Benefits: Fundamental Changes to VA’s Disability Criteria Need 

Careful Consideration. GAO-03-1172T. Washington, D.C.: September 23, 

2003. 

Military and Veterans’ Benefits: Observations on the Concurrent Receipt 

of Military Retirement and VA Disability Compensation. GAO-03-575T. 

Washington, D.C.: March 27, 2003. 

Major Management Challenges and Program Risks: Department of 

Veterans Affairs. GAO-03-110. Washington, D.C.: January 1, 2003. 

High-Risk Series: An Update. GAO-03-119. Washington, D.C.: January 1, 

2003. 

DOD Disability: Overview of Compensation Program for Service 

Members Unfit for Duty. GAO-01-622. Washington, D.C.: April 27, 2001. 

VA Disability Compensation: Comparison of VA Benefits with Those of 

Workers’ Compensation Programs. GAO/HEHS-97-5. Washington, D.C.: 

February 14, 1997. 

Workers’ Compensation: Selected Comparisons of Federal and State 

Laws. GAO/GGD-96-76. Washington, D.C.: April 3, 1996. 

Related GAO Products 

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