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Both congressional chambers were in recess this week, attending to business in their home states and districts.

Fiscal Year (FY) 2014 Defense Budget Request: Health Care Update

In one of President Obama’s most controversial budget proposals, the Department of Defense (DOD) is again asking to increase cost sharing for military retirees on TRICARE, despite being roundly refused by Congress in previous years. Secretary of Defense Chuck Hagel says he thinks that fiscal realities will make Congress realize the necessity of this move.

Health care costs account for almost 10 percent of the total DOD budget, and are expected to reach $49.4 billion in FY 2014. Last year, Congress did allow increases to TRICARE Prime enrollment fees for under age-65 military retirees and some adjustments to pharmacy copayments.

The new proposals are far more wide-ranging and include increases and new fees that have not been proposed before. DOD claims it could save $297 million in FY 2014. Many of the proposals, such as tying increases to retired pay levels, were recommended by the 2007 Task Force on the Future of Military Health Care. For example, instead of a set dollar amount for TRICARE Prime, the premium would be set at 2.95 percent of retired pay with a minimum payment of $594 per family in FY 2014 and a maximum of $750. For general and admiral retirees (who make considerably more retired pay percentage-wise compared to other ranks) the ceiling would only be set at $900 per year. These fees would increase annually, until they reach 4 percent of retired pay in FY 2018. Then the minimum would be $594 and maximum would be $1,226. For general and admiral retirees, the maximum would only be $1,840 per year. And fees for individuals would be set at 50 percent of the family fee.

New enrollment fees would be introduced for TRICARE Standard and Extra of $70 for individuals and $140 for families. Those fees would increase to $125 and $580, respectively, by FY 2018. In addition, enrollees would be responsible for deductibles of $160 for individuals and $320 for families. Those deductibles would rise by FY 2018 to $290 and $580.

Another new proposal is the creation of a $3000 catastrophic cap for all TRICARE enrollees per family. The cap will exclude enrollment fees.

TRICARE for Life (T4L) enrollees would also be required to pay a fee for the first time, equal to 0.5 percent of gross retired pay up to a maximum of $150 ($200 for generals and admirals). That fee would increase by a quarter of a percent a year until it reaches 2 percent in FY 2018, with a ceiling of $613 ($818 for generals/admirals). The fee would be applied per person, not per family. And there is no discussion of Medicare premiums; retirees must enroll in and pay the premiums for Medicare before they are eligible for T4L.

Importantly, and for the first time as well, the President would exclude those who were medically retired from the military, as well as the families of service members who fell in the line of duty. Clearly, the President is trying to ‘divide and conquer’ the military community by proposing this exclusion.

On the pharmacy side, DOD is proposing additional changes to the program. For prescriptions filled in retail outlets, one month at a time, copayments would be $6 in FY 2014 and rise to $9 in FY 2017. For brand name prescriptions, the copayment would be $28 in FY 2014 and gradually rise to $34 in FY 2017. Copayments for three-month refills from the mail order pharmacy: generic drugs would have no copayment until FY 2017, when a $9 fee would be implemented; and for brand name drugs the copayment would increase from $28 in FY 2014 to $34 in FY 2017. The fees for non-formulary drugs would be $54 in FY 2014 and rise to $66 in FY 2017. Prescriptions filled in military treatment facilities would continue to have no copayment.

Military Retiree Pay Update

The Congressional Budget Office (CBO) projects spending for military retirement pay and survivors’ annuities will rise by more than 30 percent over the next decade. About two-thirds of that growth may occur because those benefits are adjusted annually for inflation (COLA increases are subject to Congress passing an annual COLA adjustment). The remaining growth will stem from increases in the initial benefit for new retirees; that benefit depends on service members’ basic pay during their active service, which typically grows faster than inflation. In addition, CBO projects the number of military retirees and their survivors will remain essentially unchanged in the coming decade, so the number of people collecting benefits will not contribute to the growth of spending. For more details on CBO’s most recent projections for the Military Retirement Trust Fund, see Military Retirement-February 2013 Baseline at

GI Bill Updates

1) According to the Department of Veterans Affairs: Spouses and children of service members made up almost one-fourth of Post-9/11 GI Bill users last year, and their numbers appear to be growing. Troops and veterans, who can transfer the education benefit after meeting time-in-service thresholds, still account for the majority of Post-9/11 users in 2012; nearly 500,000 people, representing about a 13 percent increase from the previous year. But use of the benefit by spouses and children grew even faster. The number of spouses using Post-9/11 benefits jumped from 32,000 in 2011 to more than 54,000 last year, an increase of nearly 70 percent. The rate of use by children increased more than 13 percent, to 93,500.

2) Soldiers who opt to transfer their Post 9/11 GI Bill benefits to a family member will now be required to serve an extra four years in the Army, regardless of the amount of time they’ve already been in the service. The policy change, announced in an April 15 memo to military personnel, is effective August 1. The new rule will affect mainly retirement-eligible officers and enlisted soldiers. The current policy allows retirement-eligible service members to transfer their GI Bill benefits to a family member with anywhere from zero to three extra years’ service depending on the length of time the applicant has been in the military. Non-retirement-eligible soldiers who wish to transfer their GI Bill benefits to a family member were already required to have six years of active duty and then re-up for another four years. The new policy makes the additional four years a requirement for anyone wanting to transfer their benefits. If a soldier has incurred additional time in service in order to transfer GI benefits and then is unable to serve that additional time, he or she may be required to pay back the benefits. That rule will not apply to soldiers who are involuntarily separated from the Army as it draws down its endstrength.

Mobilized Reserve

The Department of Defense announced the current number of reservists on active duty as of April 23, 2013. The net collective result is 396 more reservists mobilized than last reported on April 15. At any given time, services may activate some units and individuals while deactivating others, making it possible for these figures to either increase or decrease. The total number currently on active duty from the Army National Guard and Army Reserve is 39,757; Navy Reserve 4,311; Air National Guard and Air Force Reserve 8,269; Marine Corps Reserve 2,464; and the Coast Guard Reserve 541. This brings the total National Guard and Reserve personnel activated to 54,946 including both units and individual augmentees. Since 9/11 there have been 874,480 reservists deactivated. A cumulative roster of all National Guard and Reserve personnel who are currently activated may be found online at


Letters of Support

The American Legion on April 30 sent a letter of support to Representative Grace Meng (NY) giving our organization’s support for draft legislation entitled the VA Regional Office Accountability Act. This legislation would require that the annual reports would be submitted to Congress by individual VA Regional Offices (ROs) if the fall below the 125-day and the 98 percent accuracy thresholds for claims processing. The object of this legislation is to assist VAROs in examining the factors contributing to their failure to meet the 125 day and 98 percent goals by requiring them to submit the annual report detailing the reasons why they failed. This requirement will enable the ROs to construct a plan of action in order to move toward the goal of ensuring our nation’s veterans receive the best and most efficient service possible. [Resolution 99-2012]

Update on Flag Amendment Bill

On January 18, House Joint Resolution (H.J. Res.) 19 was introduced by Representative Jo Ann Emerson (MO). This legislation is a proposed constitutional amendment to protect the American flag from physical desecration. Its text states simply: "The Congress shall have power to prohibit the physical desecration of the flag of the United States."

The next task is finding cosponsors for this legislation. Please contact the offices of your representative and senators, and ask them to become cosponsors of the flag amendment in their respective chambers. [Res. 272-2012]