No, the money does not have to go towards his disability if he is permanently disabled. In order for him not to be charged the 10% penalty he has to meet this requirement of being disabled.
IRC § 72(t)(2)(A)(iii). The term “disabled” is defined as “unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or to be of long-continued and indefinite duration.
If his disability does not meet this requirement any of the withdrawal that was used to pay for unreimbursed medical expenses that exceed 7.5% of your total income qualifies to not have the 10% penalty charged on that amount.
Link to Retirement Topics on Early Distributions
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