However, the combined impairment rating obtained by applying Table 18.1 (Combined Values Chart) is not to be rounded. Rounding is unnecessary since impairment periodic payments are based on whatever impairment rating is determined and are not in multiples of 5 or 10 as in the VEA.
Determining the factor for compensation payment
The combined impairment rating, which is obtained by applying Chapter 18 (Combined Values Chart), is to be combined with the lifestyle rating on either the Warlike and Non‑warlike Factors Table (Table 23.1) or the Peacetime Factors Table (Table 23.2). This is to determine the factor to be multiplied by the maximum weekly payment available under the Act, which is prescribed in section 74 of the MRCA and indexed by section 404 of the MRCA.
A veteran’s lifestyle rating is expected to be broadly consistent with the degree of medical impairment from accepted conditions as measured by the Combined Impairment Rating. In most cases a lifestyle rating that falls within the shaded area of Tables 23.1 and 23.2 will satisfy the requirement of broad consistency. There may be exceptional cases and, in accordance with Chapter 22 of this Guide, a lifestyle rating outside the shaded area may be allocated.
Where a member or former member has two or more types of service (either under MRCA or under both MRCA and DRCA/VEA) and has different conditions under each, then the instructions in “Combined ratings” apply.
Table 23.1: COMPENSATION FACTORS FOR CALCULATING PERMANENT IMPAIRMENT COMPENSATION ‑ WARLIKE AND NON‑WARLIKE SERVICE
For impairment greater than 80 points, the value is always 1.00.
Combined ratings
If the service‑caused conditions lead to impairment ratings of A for warlike (or non‑warlike) service and B for peacetime service, then the compensation payable will be a weighted average. This is determined by:
the amount that would be paid if the conditions had both been caused by warlike (or non‑warlike) service; and
the amount that would be paid if the conditions had both been caused by peacetime service.
Start formula, compensation factor final equals, start fraction, warlike rating times, open parentheses, compensation factor warlike, close parentheses, plus peacetime rating, open parentheses, compensation factor peacetime, close parentheses, end fraction, divided by, open parentheses, warlike ratings plus peacetime ratings, close parentheses, end formula The weights used are the impairment ratings A and B.
If the combined impairment is C (see Chapter 18) and the lifestyle effect is L, this can be expressed as:
The CF value for warlike (or non‑warlike) service (CFwl) is taken from Table 23.1.
The CF value for peacetime service (CFpt) is taken from Table 23.2.
The final value worked out using the above formula (CFfinal) is then multiplied by the maximum weekly compensation payable to determine the final level of compensation.
The following example illustrates this, where a veteran has a condition from warlike (or non‑warlike) service and another condition from peacetime service.
Example 1: Two conditions resulting from different service types
Captain Brown has 2 conditions:
• a gastro‑intestinal condition (A) resulting from warlike service assessed as 20 impairment points; and
• a spinal injury (B) resulting from peacetime service assessed as 30 impairment points.
The lifestyle rating (L) from these conditions is 4.
The combined impairment rating (C) is 44.
Under Table 23.1, the compensation factor that would be applied if both conditions had resulted from warlike service would be 0.478.
If both conditions had resulted from peacetime service instead, the compensation factor would be 0.268 (see Table 23.2).
The weighted average compensation factor, using the above formula, is:
(20 * 0.478 + 30 * 0.268) / (20 + 30) = 0.352
The maximum compensation payable as at 1 July 2024 of $421.72 is multiplied by this factor to give a periodic payment of $148.45 per week.
If the gastro‑intestinal condition had arisen from peacetime service (B) and the spinal condition from warlike service (A), with the same impairment and lifestyle ratings, the compensation factor would be:
(30 * 0.478 + 20 * 0.268) / (30 + 20) = 0.394
with a periodic payment of $166.16 per week.
If a veteran has 2 or more conditions resulting from warlike (or non‑warlike) service, the impairment rating A is the sum of the impairment points for each of those conditions.
If a veteran has 2 or more conditions resulting from peacetime service, the impairment rating B is the sum of the impairment points for each of those conditions.
The following example illustrates this.
Example 2: Three or more conditions resulting from different service types
Warrant Officer Smith has 4 conditions:
• a mental health condition (A) resulting from warlike service assessed as 20 impairment points;
• a lumbar spine condition (A) resulting from warlike service assessed as 10 impairment points;
• a tinnitus condition (B) resulting from peacetime service assessed as 10 impairment points;
• a knee condition (B) resulting from peacetime service assessed as 10 impairment points.
The lumbar spine condition does not cause any resulting impairment to the officer’s knees, thus does not affect the impairment rating assigned for the knee condition.
The total impairment at (A) is 30 (20+10 impairment points).
The total impairment at (B) is 20 (10+10 impairment points).
The lifestyle rating (L) from these conditions is 4.
The combined impairment rating (C) is 42.
Under Table 23.1, the compensation factor that would be applied if all 4 conditions had resulted from warlike service would be 0.461.
If all conditions had resulted from peacetime service instead, the compensation factor would be 0.258 (see Table 23.2).
The weighted average compensation factor, using the formula, is:
(30 * 0.461 + 20 * 0.258) / (30 + 20) = 0.380.
The maximum compensation payable as at 1 July 2024 of $421.72 is multiplied by this factor to give a periodic payment of $160.25 per week.
Chapter 24
CONVERTING WEEKLY SUMS INTO LUMP SUMS
Once the MRCC determines that compensation is payable under any of sections 68, 71 or 75(2) of the Act it must notify the claimant of the weekly amount of compensation and advise if it may be converted wholly or partly into a lump sum.
A member may accept the weekly payment for life or convert all or part of it to a lump sum using factors approved by the Australian Government Actuary.
The convertible amount
The convertible amount (see section 78) is the weekly amount of compensation that is payable.
If the convertible amount is less than 10% of the maximum weekly amount payable under the Military Rehabilitation and Compensation Act 2004, the person may convert the entire amount to a lump sum.
If the convertible amount is at least 10% but not more than 20% of the maximum weekly amount payable under the Act then the person may convert 50% or 100% to a lump sum.
If the convertible amount is more than 20% of the maximum weekly amount payable under the Act then the person may convert 25%, 50%, 75% or 100% to a lump sum.
Chapter 25
METHOD OF WORKING OUT THE AMOUNT OF COMPENSATION PAYABLE UNDER THE MRCA FOR A PERSON WITH A VEA OR DRCA INJURY OR DISEASE
Introduction
This Chapter deals with situations where an injury or disease (the condition) has been accepted under the VEA, or the DRCA, or both the VEA and DRCA, before a claim is made under the MRCA.
Definitions
In this Chapter:
DRCA means the Safety, Rehabilitation and Compensation (Defence‑related Claims) Act 1988.
DRCA accepted condition, in relation to a person, means the person’s injury for which the Commonwealth is liable to pay compensation under DRCA.
Note Under DRCA, an injury includes a disease (see DRCA, sections 5A and 5B).
MRCA means the Military and Rehabilitation Compensation Act 2004.
MRCA determination, in relation to a person, means the determination by the Commission of the degree of impairment suffered by the person as a result of a compensable condition under the MRCA.
MRCA accepted condition means the injury or disease for which the Commission has accepted liability under section 23 of the MRCA.
MRCA compensation payment means the payment worked out under this Chapter for a person with a MRCA accepted condition and a DRCA accepted condition and/or a VEA accepted condition.
MRCA PI—see the definition of MRCA Permanent Impairment.
MRCA Permanent Impairment or MRCA PI, in relation to a person, means the person’s impairment for which compensation is payable under Chapter 4 of Part 2 of the MRCA.
VEA accepted condition, in relation to a person, means the person’s incapacity from an injury or disease that the Repatriation Commission has determined under section 19 of the Veterans’ Entitlements Act 1986 (including as applied under section 71 of that Act) entitles the person to be granted a pension under Part II or IV of that Act (other than a pension payable to a person as a dependant of a deceased veteran), ie a pension under subsection 13(1) or subsection 70(1) of that Act.
VEA percentage means the amount payable under the VEA for the conditions referred to in Step (1) below, as at the date of the MRCA claim, expressed as a percentage of the General Rate at that date.
Assessing total MRCA PI compensation
The method to assess the total amount of MRCA PI compensation payable under the MRCA is as follows.