Action in Congress

Oct. 1, 2003

Guard, Reserve Tricare On Hold

It appeared in early fall that drilling National Guard and Reserve members will have to wait another year at least to gain access to year-round military health care benefits.

In passing its version of the 2004 defense authorization bill, the Senate included a provision that would allow Guardsmen and Reservists to enroll in Tricare for modest fees.

DOD balked because of cost concerns, and the Senate and Bush Administration agreed to study the issue another year.

Bipartisan support for the plan had appeared strong. However, Sen. Lindsey Graham (R-S.C.), a leading advocate of the effort, agreed to the study compromise brokered by Sen. John Warner (R-Va.), chairman of the Senate Armed Services Committee.

The Senate plan would allow Selected Guard and Reserve personnel to enroll in Tricare for premiums equal to 28 percent of actual cost. The government would pick up the rest of the cost. Estimates of costs to enrollees were under $600 for individuals and under $1,500 for families.

Cost Dispute Snarls Benefit

In this latest Tricare debate, the Administration indicated it was inclined to support a reserve medical benefit of some kind, if Congress provided funds. Funding was clearly the key.

Secretary of Defense Donald H. Rumsfeld opposed the Senate plan, claiming it could add an unfunded $5.1 billion per year liability to the defense program and force DOD to shortchange other needs.

Guard and Reserve advocates said Rumsfeld’s cost estimate was far too high. They noted that only about 20 percent of Guardsmen and Reservists lack coverage and most are insured through employers or other means, but that Rumsfeld’s figure assumes that all eligible Guardsmen and Reservists would enroll in Tricare.

The Senate, for its part, projected the annual cost at $2 billion, less than half the DOD estimate. However, because the program was not funded, Republican leaders agreed to a delay.

TSRx Unaffected by Medicare

Tricare officials say passage of a prescription benefit for all Medicare recipients will not affect the Tricare Senior Pharmacy program (TSRx), which is viewed as an employer provided benefit plan.

Legislation progressing in Congress would have Medicare subsidize prescription drugs for the elderly and disabled. Senate and House bills would allow enrollment for monthly premiums of $35, a cost-sharing formula, and an annual deductible.

The military’s 1.4 million beneficiaries age 65 and older will continue to enjoy a triple-option plan:

  • Free prescriptions on base.
  • The Tricare Mail Order Pharmacy program with co-payments of $3 (generic) or $9 (brand-name) for a 90-day supply of most drugs.
  • A retail pharmacy network plan with $3 and $9 co-pays for a 30-day supply of most medicines.

The co-payments will rise with the adoption next year of a uniform military drug formulary.

Coming: Part B Penalty Relief

Though most are not affected, some elderly military retirees do have a significant stake in the Medicare prescription bills (H.R. 1 and S. 1).

Both would waive the Medicare Part B enrollment penalty that military retirees now pay for waiting beyond age 65 to enroll in Part B.

About 90,000 elderly retirees declined Part B coverage, for physician services and outpatient care, when they turned 65. Many of them did so assuming they always would have access to military care or to health insurance through spouses or second-career employers. Thus they avoided Part B premiums, now $58.70 a month and rising to $66 next year.

To qualify for Tricare for Life—the so-called “golden supplement” to Medicare—65 and older military retirees must be enrolled in Part B. Under current law, those who enroll late face a 10 percent penalty on premiums for each year they delayed enrollment past age 65. Therefore, a 70-year-old who enrolls today would pay 50 percent more in monthly premiums, or $88.05.

The Medicare reform bills would drop the premium penalties on military retirees who enrolled late, after Dec. 31, 2000, and waive the penalty provision for beneficiaries through Dec. 31, 2004. The Senate bill would delay Part B coverage for new late enrollees until January 2005. The House bill would implement it this year.

Tricare Can’t Track Docs

The General Accounting Office, Congress’ watchdog agency, has informed lawmakers that no one knows if enough physicians are participating in Tricare Standard, the military’s fee-for-service health insurance program.

GAO contended that Tricare officials have not established the systems needed to measure whether there are enough doctors to meet beneficiary demands.

Military beneficiary groups testified last year that many Standard users had difficulty finding physicians who accept Tricare. They blamed low reimbursement rates and administrative hassles.

Congress asked GAO to investigate. The auditors couldn’t confirm a shortage of participating physicians but said Tricare officials can’t rule it out. GAO said oversight of doctor networks was hindered by inadequate data collection.

Congress Eyes Force Levels

Congressional auditors charge that the military’s expanded role in homeland security since 9/11 is affecting readiness and possibly troop morale.

The agency examined the strain on US forces from new domestic missions and criticized Defense Department officials for delaying changes in force structure to address homeland security needs until a Quadrennial Defense Review in 2005.

The Bush Administration hasn’t tailored forces to avoid degradation of training and combat readiness, said GAO. It noted that seven Air National Guard fighter wings are heavily tasked with homeland security missions. In one, it said, “the average pilot was unable to meet training requirements in nine out of 13 months” after Sept. 11, 2001.

Meanwhile, GAO said, the pace of operations is so high that thousands of personnel are exceeding personnel tempo ceilings set by Congress to protect troop morale. As a result GAO warned of “future personnel retention problems.”

After release of the GAO report, defense officials announced they won’t wait until 2005 to work on rebalancing forces. A study is under way.

VA Plan Stirs Opposition

Some lawmakers predictably are expressing outrage at a draft health care reorganization plan put forward by the Department of Veterans Affairs. In the plan, VA facilities in certain states and districts are targeted for closure or downsizing.

The plan—Capital Asset Realignment for Enhanced Services, or CARES—aims to shift VA staff and resources, by 2020, to the places most in need. The VA intends to make final decisions this December. Between now and then, CARES will be analyzed by an independent commission.

VA Secretary Anthony J. Principi calls CARES the most comprehensive assessment of VA facilities since World War II. He says it will make health care available to more veterans and reduce waste by closing underused facilities.

However, the plan has angered members of Congress who have constituents destined to lose VA services or health care jobs.

With veterans in much of the country facing long waits for VA medical appointments, veterans groups oppose the closing of any facility. They say new facilities should be built where needed.

The draft plan would close seven hospitals and realign services at many other facilities. Other areas would benefit from new medical centers and the opening of more outpatient clinics where veteran populations are rising. The entire plan can be viewed online at:

VA would close older hospitals in Brecksville, Ohio, Canandaigua, N.Y., Gulfport, Miss., Lexington, Ky., Livermore, Calif., Pittsburgh, and Waco, Tex.

It would open new hospitals in Las Vegas and in Orlando, Fla.

Also opening would be centers for the blind in Biloxi, Miss., and Long Beach, Calif., as well as spinal-cord injury centers in Albany or Syracuse, N.Y, Denver, Little Rock, Ark., and Minneapolis.

Ex-Students Get Loan Reprieve

President Bush in August signed legislation that gives the secretary of education authority to allow deployed service members and mobilized reservists to delay repayment of education loans.

Freshmen Rep. John Kline (R-Minn.) introduced the bill to bring “a little more peace of mind” to service members and ease their financial problems when deployed.

The Department of Education will administer the Higher Education Relief Opportunities for Students Act of 2003 (HEROES), screening applications of reservists and deployed active duty students to delay student loan payments and spare their families lender collection calls.

The authority is set to end Sept. 30, 2005. The Education Department must report to Congress before that date on whether the program should continue.

War Pay Flap

The Bush Administration said in mid-August that it would work to preserve for each service member in Iraq and Afghanistan up to $225 in special wartime pay increases enacted last April. The Administration earlier had called for allowing the special pay increases to expire.

Democrats claimed it was a politically driven change of heart. Rep. Ike Skelton (D-Mo.) and Rep. John Spratt (D-S.C.) said in a statement that the Administration’s earlier position was “a direct affront” to all service members.

Rumsfeld had opposed “unrequested” increases. Among these were a $150 hike in the monthly Family Separation Allowance (FSA) and $75 boost in Imminent Danger Pay (IDP). The increases were set to expire on Sept. 30 unless Congress voted to extend them.

The combined increases came to about $25 million per month.

DOD said the increases were an inefficient way to help troops in Iraq and Afghanistan. Much of the $25 million per month increase went to service members deployed elsewhere.

FSA is paid to any service member forced to live away from family for more than 30 days. IDP goes to members serving in scores of designated danger areas.

David S.C. Chu, undersecretary of defense for personnel and readiness, claimed in an Aug. 14 news conference that DOD never intended to take the increases away from troops serving in Iraq and Afghanistan but merely wanted a more efficient plan.