Source: https://askus.unitedspinal.org/index.php?pg=kb.page&id=2164
Timestamp: 2019-04-22 00:25:17+00:00

Document:
VA benefits are restricted to veterans discharged or released "under conditions other than dishonorable." The military services each have several categories of discharge, one of which is "dishonorable." These categories are not what VA bases a character of service determination: VA has its own unique system.
VA generally accepts "honorable" discharges and discharges "under honorable conditions" as qualifying discharges without further investigation. VA has also determined that a "dishonorable" discharge is not an "other than dishonorable" discharge and so will disqualify a claimant from any VA benefits unless a narrow insanity exception applies. If an individual received a discharge under "other than honorable conditions" or a "bad conduct" discharge, VA will make a special "character of service determination" before further processing a claim. In making this determination VA is supposed to consider the veteran's entire period of service not just the specific type of discharge. If VA determines that the individual was separated from service under a disqualifying condition, the veteran will be ineligible for compensation benefits, although he or she may still qualify for certain healthcare benefits. A character of service determination can be appealed if unfavorable.
A veteran with a discharge that does not qualify him or her for compensation benefits may try to "upgrade" the character of the discharge. VA does not change the character of discharge assigned by the service branch. Each service branch has a "Discharge Review Board" ("DRB") and a "Board for Correction of Military Records" ("BCMR"). Both of these Boards have their own procedures for reviewing cases of veterans looking to change an unfavorable character of discharge and it is beyond the scope of this KNOWLEDGE BOOK to describe the processes. Veterans who believe that their character of discharge was improper or unfair are encouraged to contact an advocate or attorney experienced in the upgrade process.
Regardless of the character of discharge, individuals are not eligible for VA benefits for conditions that result from "willful misconduct" or substance abuse. Willful misconduct includes intentional acts such as self-inflicted injuries to avoid duty or deployment. Health conditions arising from the abuse of illegal drugs or alcohol abuse are also excluded. As questions of willful misconduct are very fact specific, claimants potentially affected by this requirement are encouraged to discuss the matter with an experienced advocate. There is one very important exception to the substance abuse exclusion. An individual is eligible for VA benefits for conditions related to drug or alcohol abuse arising from another allowable service-connected condition. For example, an individual suffering from post-traumatic stress disorder ("PTSD") as a result of an incident during service can receive benefits for the adverse health effects of alcoholism if the alcoholism is determined to be a result of the PTSD. Alcoholism unrelated to another service-connected condition would not be eligible for compensation.
VA "compensation . . . is not payable unless the period of service on which the claim is based was terminated by discharge or release under conditions other than dishonorable." 38 C.F.R. § 3.12(a). "A discharge or release because of one of the offenses specified in this paragraph is considered to have been issued under dishonorable conditions[:] . . . An offense involving moral turpitude. This includes, generally, conviction of a felony." 38 C.F.R. § 3.12(d)(3). 38 U.S.C. section 101(2) defines a veteran as a person who "was discharged ... under conditions other than dishonorable."
The law, however, contains an exception that "if it is established to the satisfaction of the Secretary that, at the time of the commission of an offense leading to a person's court-martial, discharge, or resignation, that person was insane, such person shall not be precluded from benefits under laws administered by the Secretary." 38 U.S.C. § 5303(b); 38 C.F.R. § 3.12(b).
VA regulations define an insane person as one who, while not mentally defective or constitutionally psychopathic, exhibits, due to disease, a more or less prolonged deviation from his normal method of behavior; or who interferes with the peace of society; or who has so departed (become antisocial) from the accepted standards of the community to which by birth and education he belongs as to lack the adaptability to make further adjustment to the social customs of the community in which he resides." 38 C.F.R. § 3.354(a); see Zang v. Brown, 8 Vet. App. 246, 253 (1995) (stating that phrase "due to disease" applies to all three circumstances provided in section 3.354(a)); see also VA Gen. Coun. Prec. 20-97 (May 22, 1997) (clarifying VA's definition of insanity). Although insanity need not be causally connected to the misconduct that led to the discharge, it must be concurrent with that misconduct and requires competent medical evidence to establish a diagnosis. Beck v. West, 13 Vet. App. 535, 539 (2000); Zang, 8 Vet. App. at 254-55; 38 C.F.R. § 3.354(a).
When determining whether a veteran was insane at the time of an offense, the rating agency "will base its decision on all the evidence procurable relating to the period involved." 38 C.F.R. § 3.354(b). The Court reviews the Board's factual decision in this regard under the "clearly erroneous" standard of review. 38 U.S.C. § 7261(a)(4); Beck, 13 Vet. App. at 539; Gilbert v. Derwinski, 1 Vet. App. 49, 52-53 (1990).
Acceptance of an undesirable discharge to escape trial by general court-martial is considered a discharge or release "under dishonorable conditions." 38 C.F.R. § 3.12(d)(1). Such a discharge generally "is a bar to the payment of benefits." 38 C.F.R. § 3.12(b). Further, an honorable or general discharge awarded under the Department of Defense's special discharge review program ("SDRP") generally "does not remove any bar to benefits." 38 C.F.R. § 3.12(h). When a veteran has multiple periods of service, it is the character of service for the period in which the medical condition arises that determines eligibility.

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