The Veterans Affairs Schedule for Rating Disabilities (VASRD) is used by the Department of Veterans Affairs (VA) as part of the process of adjudicating disability claims. It is a guide for evaluating the severity of disabilities resulting from all types of diseases and injuries encountered as a result of, or incident to, military service. This degree of severity is expressed as a percentage rating which determines the amount of monthly compensation.

The VA uses the VASRD to rate service-connected disability of veterans for loss of civilian employability. The VASRD is also used by the Army to rate the service-connected impairment of active duty soldiers. Unlike the VA, the Army must first determine whether a soldier is fit to reasonably perform the duties of their office, grade, rank, or rating. As a result of provisions in the National Defense Authorization Act of 2008, the Army is required to utilize the VASRD to evaluate injured soldiers and must eliminate its own disability ratings rules unless the Army rating rules would result in a higher disability rating than the VASRD assigned.

While both the Army and the VA use the VASRD, not all the general policy provisions set forth in the VASRD apply to the Army. Consequently, disability ratings may vary between the two agencies. The Army rates only conditions determined to be physically unfitting, compensating for loss of a career. The VA may rate any service-connected impairment, thus compensating for loss of civilian employability. Also, the Army's ratings are permanent upon final disposition while VA ratings may fluctuate with time, depending upon the progress of the condition. Further, the Army's disability compensation is affected by years of service and basic pay; while VA compensation is a flat amount based upon the percentage rating received.

When a Physical Evaluation Board (PEB) determines a soldier is not fit for continued military service by reason of a physical disability, the disabling condition is rated in accordance with the VASRD, as modified in Army Regulation (AR) 635-40, Appendix B. Once a soldier is determined to be physically unfit for further military service, VASRD percentage ratings are applied to the unfitting condition(s).The impairment rating does not result in a disability rating unless the PEB determines that the impairment renders the soldier unfit for duty.

Conditions that do not themselves render a soldier unfit for military service will not be considered for determining the compensable disability rating unless they contribute to the finding of unfitness. Soldiers found unfit by reason of a physical disability that was not incurred or aggravated during the soldier's service will be separated without benefits. However, if the condition was caused or aggravated by military service, the PEB will use AR 635-40,  DoD Directive 1332.18 and the VASRD to assign an appropriate rating. This rating is determined based on the disabling condition(s) and its severity and can range from 0 to 100 percent, rising in increments of 10.

A soldier is entitled to severance pay if assigned a rating of less than 30%. Severance pay is calculated by multiplying two months base pay rate times the number of years of active duty service up to 12 years (six months or more of service is counted as a whole year). If a soldier is assigned a disability rating of 30% or more, they are entitled to disability retired pay.

For more information, please visit the Army Regulation regarding VASRD Codes maintained by the Army Publishing Directorate:
https://armypubs.army.mil/epubs/DR_pubs/DR_a/pdf/web/ARN6811_AR635-40_ADMIN_WEB_Final.pdf

The Veterans Affairs Schedule for Rating Disabilities (VASRD), 38 CFR Book C, Schedule for Rating Disabilities:
https://www.benefits.va.gov/warms/bookc.asp