May 9, 2011 in City

Health care takes toll on Pentagon

Obama seeks to raise medical plan fees for some military retirees
Donna Cassata Associated Press

WASHINGTON – A military built for fighting wars is looking more and more like a health care entitlement program.

Costs of the program that provides health coverage to some 10 million active duty personnel, retirees, reservists and their families have jumped from $19 billion in 2001 to $53 billion in the Pentagon’s latest budget request.

Desperate to cut spending in Washington’s time of fiscal austerity, President Barack Obama has proposed increasing the fees for working-age retirees in the decades-old health program, known as TRICARE.

After years of resisting proposed increases for the military men and women who sacrificed for a nation, budget-conscious lawmakers suddenly are poised to make them pay a bit more for their health care, though not on the president’s terms.

The current fees, unchanged in 11 years, are $230 a year for an individual and $460 for a family. That’s far less than what civilian federal workers pay for health care, about $5,000 a year, and what most other people in the U.S. pay.

Obama is seeking a fee increase of $2.50 per month for an individual and $5 per month for families.

Future increases starting in 2013 would be pegged to rising costs as measured by the national health care expenditure index produced by the Centers for Medicare and Medicaid Services, which projects 6.2 percent growth.

“Health care is eating the department alive,” Defense Secretary Robert Gates said bluntly – two years ago.

The explosive expense of health care rivals what the Pentagon shells out to buy fighter aircraft, submarines and high-tech weapons, and is about half of the $118 billion that the Obama administration wants in the next budget to fight the wars in Iraq and Afghanistan.

Rep. Howard “Buck” McKeon, chairman of the House Armed Services Committee, backs Gates’ proposal to raise fees for working-age retirees in the next budget, and he has the support of the committee’s top Democrat, Rep. Adam Smith of Washington state.

But McKeon, R-Calif., rejects the plan to link increases in 2013 and beyond to the health care expenditure index. He wants to tie any future increases to military retirees’ cost-of-living adjustment, which this year was zero.

McKeon planned to release his version of the defense bill today.

The full committee meets Wednesday to pull together an overall defense bill for the budget year beginning Oct. 1. The committee is expected to override members of its personnel subcommittee who last week unanimously approved a one-year prohibition on any increase in health care fees.

“I strongly believe military retirees have made significant down payments through their dedicated service to the nation,” said the subcommittee chairman, Rep. Joe Wilson, R-S.C. “In view of that service, it is not right for the nation to ask them to pay more for the health care for which they are entitled as all citizens are being personally challenged financially by rising gas prices.”

Congress repeatedly has resisted Pentagon efforts to increase copayments or fees, arguing that members of the military and their families sacrifice far more than the average American, with a career that includes long and dangerous deployments overseas that overshadow civilian work.

Even as Washington wrestles with a ballooning deficit estimated at $1.6 trillion and the demands of entitlement programs such as Medicare and Social Security, lawmakers are reluctant to raise health care costs for members of the military and retirees.

But this year, Gates singled out working-age retirees, such as those in their 40s who retired after some 20-plus years in the military, as individuals who could afford a small increase.

“Many of these beneficiaries are employed full time while receiving full pensions, often forgoing their employer’s health plan to remain with TRICARE,” Gates told Congress. “This should come as no surprise, given that the current TRICARE enrollment fee was set in 1995 … and has not been raised since.”

Gates and the administration are up against a very powerful constituency, the network of veterans groups and retired generals determined to stop any increase.

The Military Officers Association of America backs the one-year fee increase, but strongly opposes any increase in 2013 and beyond linked to the health care expenditure index.

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