Much as I hate to defend Cathay, the fact is the US Navy broke him so I would suggest that it is up to the US Government to take care of him, not the airline.
Holding a pilot on the sick list costs Cathay money so why should Cathay pay when one of their pilots are injured on Military service for a foreign nation.
Would British Airways be expected to automatically retain a pilot who was a Taiwanese citizen with a UK right of abode and was disabled ejecting from a Taiwan Air Force jet ?