A bill to amend chapter 5 of title 37, United States Code, to revise the special pay structure relating to medical officers and other health professionals of the uniformed services.

States that an officer of the Army or Navy in the Medical or Dental Corps or in the Medical Service Corps (if he is designated as an optometry officer), an officer of the Army in the Veterinary Corps, an officer of the Air Force who is designated as a medical, dental, veterinary, or optometry officer, or a medical, dental, veterinary, or optometry officer of the Public Health Service, who is on active duty for a period of at least one year is entitled, in addition to any other pay or allowances to which he is entitled, to special pay at the following rates: (1) $100 a month for each month of active duty if he has not completed two years of active duty in a category named in this section; or (2) $350 a month for each month of active duty if he has completed at least two years of active duty in a category named in this section.

States that such amounts may not be included in computing the amount of an increase in pay authorized or in computing retired pay or severance pay.

Provides for special pay to medical, dental, veterinary, or optometry officers who execute active duty agreements. States that under regulations prescribed by the Secretary of Defense or by the Secretary of Health, Education, and Welfare, as appropriate, the Secretary concerned, or his designee, may terminate, at any time, an officer's entitlement to such special pay.

Requires the Secretary of Defense and the Secretary of Health, Education, and Welfare to submit a yearly report to the Committees on Armed Services of the Senate and House of Representatives regarding the operation of the special pay program.