RAND National Defense Research Institute Santa Monica United States
After more than a decade of war, the military services have many returning personnel with mental health needs, and thus the United States needs to ensure that it has the capacity to address their needs. The objective of this research is to create a capability for predicting the effect of changes in the type or amount of special and incentive S and I pays on the retention of officers in mental health professions. We used RANDs dynamic retention model DRM as the analytical basis for relating S and I pays to retention. The DRM is a dynamic programming model of individual retention and reserve component participation over the life cycle in a world with uncertainty and with individual preferences for military service. Several steps were needed to implement the DRM for mental health care professionals. We reviewed financial aid programs covering education costs offered by the military and developed an approach for conceptualizing and modeling the choice of financial aid with associated service obligations. Estimation of the model requires information on expected military and civilian pay over a career, as well as longitudinal data on active duty retention and subsequent participation, if any, in the reserve components. We reviewed S and I pays and used regular military compensation plus the expected amount of scheduled S and I pays by year of service to develop expected military pay by year of service for each occupation. We used American Community Survey data to estimate civilian earnings regressions and predict expected earnings by age and earnings decile, by occupation. We also modified the DRM to handle the service members choice of obligation length under multiyear special pay.