By Rick Maze - Staff writer Army Times
Posted : Monday Sep 19, 2011 12:48:01 EDT
President Obama’s $4.4 trilliondeficit-reduction plan proposes additional increases in Tricare pharmacy co-pays for military beneficiaries and would begin charging an enrollment fee for older retirees using Tricare for Life health benefits.
But the plan postpones any fundamental changes in military retired pay until yet another commission studies the issue.
A White House statement says the current 20-year military retirement system is outdated and needs an overhaul, but it pledges that any change should not apply to those already retired or currently serving.
Unveiled Monday amid bitter partisan fighting over economic policy, Obama’s deficit reduction proposal calls for a modest but a symbolically significant $200 annual enrollment fee for retirees aged 65 and older to receive military health care benefits.
The first-ever enrollment fee for Tricare for Life would take effect in fiscal 2013, which means no sooner than Oct. 1, 2012. The fee would generate $6.7 billion in revenue over 10 years, according to White House estimates.
Tricare pharmacy co-payments would increase to more closely match federal employee benefits under the Obama plan. A White House fact sheet says the changes would not apply to active-duty members, but would apply to all active-duty family members and all retirees, regardless of age.
Effective Oct. 1, Tricare beneficiaries having prescriptions filled at a retail pharmacy will pay $5 for generic and $12 for a brand name prescription at a retail pharmacy and $25 for brand name drugs not on the preferred list. The Obama plan would raise fees to match those in the federal employee’s Blue Cross Blue Shield Standard plan, which requires $10 co-pays for generics, $40 for brand name prescriptions and 50 percent of the cost of brand name drugs not on the plan’s preferred list, with a minimum co-pay of $50.
The pharmacy changes would cut federal spending by about $20.6 billion over 10 years.
The White House fact sheet says the administration “supports a generous health care benefit” but says co-payments for military beneficiaries “have lagged behind other federal and private plans.”
Similarly, the fact sheet says an annual fee for Tricare for Life benefits is warranted because this program now has no premium, “unlike comparable services in the private sector.”
There has been much recent discussion about overhauling military retired pay as a cost-cutting measure, but the Obama plan includes no specific change. Instead, it calls for a bipartisan commission — similar to the one used to recommend base closings and realignments — to study retired pay and make recommendations for changes. Like the base closing commissions, the retired pay recommendations could be passed or defeated under expedited rules for consideration but could not be altered.
The White House statement supports some form of change, saying the 20-year military retired pay model “has served the military well in past years” but was “designed for a different era of work, and is now out of line with most other government or private retirement plans.”
It calls retirement after 20 years of service “generous benefits to the relatively few members who stay for 20 years,” which is the same position taken by government and independent commissions advocating a variety of changes.
To get the ball rolling, the Defense Department would have to send the commission a formal recommendation for altering retired pay, which the commission would use as the basis for its discussions.
I see a class action law suit coming over TFL. TFL was implemented to keep recruitment contract promised made to many, including me. Pay me now or pay me after I sue you. This guy is hard to take.
"As a nation, we're facing tough choices as we put our fiscal house in order," the president said, getting a standing ovation from the crowd of thousands in the process. "But I want to be absolutely clear: We cannot, we must not, and we will not balance the budget on the backs of our veterans. And as commander-in-chief, I won't allow it."
Barack Obama to the American Legion, 30 August 2011
