by Colonel Bob Pappas, USMC, Retired
“Change” has begun to come to fruition in ways that may not have been anticipated by the majority of voters, in particular military voters. It is remarkable that Military Health Care issues are included in the Administration’s Budget submission not so covertly disguised as up to a $2000.00 per annum “fair share” tax on military members. TriCare for Life was enacted to fulfill the Government’s long standing promise of no out of pocket health care costs to career length military retirees. $2000.00 per year is roughly the amount it costs for a civilian health care plan for a single person. Military retirees should keep in mind that in the background is “Obamacare,” the government’s unilaterally partisan enacted mandatory universal health care law.
By way of background, included are two sections of the Obama Administration’s current budget titled: “CUTTING WASTE, REDUCING THE DEFICIT, AND ASKING ALL TO PAY THEIR FAIR SHARE” found on page 23 of the Administration’s Budget submission. The paragraph titled, “Implement the New Defense Strategy” on pages 25 states:
“ … the President directed the Pentagon to undertake a comprehensive strategic review to ensure our defense budget is driven by a clear strategy….
“The key elements of the strategy are:
• Strengthening our presence in the Asia Pacific with a continued vigilance in the Middle East.
• Investing in our critical partnerships and alliances, including NATO, …
• Having ended our military commitment in Iraq and commenced a drawdown in Afghanistan,
and as we look to future threats,…we will field smaller forces while focusing on modernization to address emerging threats.
• Continuing to get rid of outdated Cold War era systems so that we can invest in …the ability to operate in environments where adversaries try to deny us access.
• Keeping faith with those who serve by prioritizing efforts that focus on wounded warriors, mental health, and the well-being of military families.” (emphasis mine)
With that as background, one should take consider how the Administration proposes to implement its strategy specifically focused the last element of the strategy shown above i.e. “Keeping faith with those who serve by prioritizing efforts that focus on wounded warriors, mental health, and the well-being of military families.” From pages 29-30 of the Budget titled:
“Better Align Federal Worker and Military Retirement Programs.
… The Administration is proposing a set of reforms to align these retirement programs better with the private sector, while still preserving the Federal Government’s ability to recruit and retain the personnel that the American people need…. The reductions sought in these retirement reforms are evenly split between civilian and military retirement programs. (emphasis mine)
For military retirement reforms, the Administration proposes to:
• Increase TRICARE Prime Enrollment Fees, Initiate Standard/Extra Annual Enrollment Fees, and Adjust Deductible and Catastrophic Caps. DOD has implemented a variety of efficiencies within its medical program and continues to seek cost savings, but with increases in users, increased utilization, and expansion of benefits, defense health costs keep growing. In 2012, DOD implemented minor TRICARE Prime fee increases for new retiree enrollees. In 2013, DOD will phase in additional fee increases based on annual retirement pay and initiate Standard and Extra enrollment fees. (emphasis mine) Deductibles will be slightly increased and the current catastrophic cap adjusted. The Administration’s proposal is estimated to save $12.1 billion in discretionary funds over 10 years.
• Initiate Annual Fees for TRICARE-For-Life Enrollment (TFL).
Upon turning 65, military retirees and their families transition to Medicare coverage, with TFL becoming second payer. In the private sector, this type of “Medigap” policy would likely require premiums, deductibles, and co-pays. In 2009 the average annual premium for a Medigap policy was $2,100. By contrast, there are no premiums under the TFL programs. The Administration is proposing to introduce modest annual fees for the TFL program, based on retirement pay. (emphasis mine) This proposal is estimated to save approximately $5.9 billion in mandatory funds and $5.0 billion in discretionary funds over 10 years.
• Make Targeted Increases to TRICARE Pharmacy Benefit Copayments.
Copayments for military members have lagged behind other Federal and private plans’ copayments for prescription drugs. In an effort to slow the growth in DOD’s health care costs, the President’s 2012 Budget included minor pharmacy co-pay adjustments—which were supported by Congress. The new proposal would encourage the use of less expensive mail order and military treatment facility pharmacies. This option would have no impact on active duty members, but would affect active duty families and all military retirees regardless of the age of the beneficiary. (emphasis mine) The Administration’s proposal is estimated to save $10.6 billion in mandatory funds and $17.4 billion in discretionary funds over 10years.
• Establish a Military Retirement Modernization Commission.
To recommend improvements to the military retirement system, the Administration is proposing to establish a Military Retirement Modernization Commission...”
It is notable that the Administration recommends a minor adjustment to Federal Employee contributions i.e. 1.2% increase over three years that ostensibly equates to, “The reductions sought in these retirement reforms are evenly split (emphasis mine) between civilian and military retirement programs.” It is difficult, if not impossible to validate the even split since no data was offered in support of the claim. However, increases in costs to military members and retirees were offered with specificity and are shown on the following table borrowed from the Military Officers Association of America (MOAA) website.
There will no doubt be vigorous debate and lobbying over this “fair share” tax on military members and retirees health care; and the disparity between Federal Civilian and Military Retiree programs. Keep in mind that there is an overarching and I might add overreaching program commonly referred to as “Obamacare” the implications of which have yet to be completely revealed. “Obamacare” is currently before the Supreme Court for a determination as to Constitutionality…and if upheld as Constitutional will be the subject of ongoing political action depending on how the forthcoming general election turns. Republican Candidates have vowed to overturn the Federal program and seek health care solutions that are not as overreaching or onerous as is the present law. That promise would be entirely dependent on Partisan control of both Houses of Congress the answer to which will also be determined during the forthcoming general election.
It is evident that the Administration strongly courts military members both by rhetoric and minor programs writ large and it is notable that while doing so submits budgetary recommendations that are inimical to the interests of the very ones with whom it boldly announces that it is “Keeping Faith.” Hummm.
Copyright © May 29th, 2012 by Robert L. Pappas. With proper attribution, this essay may be quoted and redistributed. It may not be used in any way, in conjunction with any advertisement without the author’s expressed written permission.