The Officer May/June 2012 : Page 10

prognosis for CHange Capt Marshall a. hanson, Usnr (ret.) roa DireCtor of legislation Capitol Hill ConneCtion Congress reviews increase to health care fees. y the time you read this, the House Armed Services Committee will have marked up its version of the National Defense Authorization Act, which is scheduled for a vote in the House by mid-May. Te good news is that just because President Barack Obama and the Pentagon request certain budget cuts, this doesn’t mean that Congress will mirror these requests in the final bill, especially this year. Many readers have likely either read or heard about proposed Tricare fee increases (see table, p. 11) . Te administration reduced the Department of Defense (DoD) budget by more than $4 billion to force Congress to raise Tricare fees, but this strategy hasn’t worked. All the suggested increases, except one, require changes to the law and, in early March, the Pentagon hadn’t submitted any legislative language. Te one fee increase suggested by the Pentagon that can be done automatically is prescription copayments. ROA talked to people on Capitol Hill who weren’t too happy about letting even this through without a change, as this requires mandatory funding that requires an offset. If Congress did nothing, Tricare fee increases would not go into effect, and the Armed Services committees are not required to take action, because those changes are discretionary. Tere is hesitation to do so, because then DoD would have to pay for the $4 billion shortfall out of other programs. Luckily, the $4 billion is spread over several years, and Hill staffers say it would be about $600 million in discretionary funding in Fiscal Year (FY) 2013. Staffers are also looking at health care efficiencies that could offset some of this cost, such as the reductions in follow-on health expenses with the troops being out of Iraq, and the return of military health providers from theater to military treatment facilities. Reductions in troop strength for the Army and Marines will also reduce health care expenses. Contracted health services cost DoD twice as much as health care costs on bases. DoD officials continue to tout that “working-age retirees” (those younger than 65) should use their employers’ health care. Te Congressional Budget Office predicts that if Tricare fees go up, 60 percent of savings will come from beneficiaries leaving Tricare, providing the Pentagon with long-sought-afer 10 the savings. Tis message was not well received in Congress. ROA and other associations advocate that no change be made to the adjustments of the annual Tricare Prime enrollment fee, allowing only an increase at the same percentage as the retiree’s cost-of-living (COLA). In testimony, ROA pointed out that the actual inflation rate is higher than how COLA is calculated. While COLA adjustment increased by 3.6 percent, everyday prices rose 7.2 percent in the past year, according to the American Institute for Economic Research. Te association continues to object to a Tricare Standard annual enrollment fee, as this is the most expensive health care to Tricare beneficiaries. One compromise might be allowing the current deductibles of $300 for families (individuals are half that) to increase but at the COLA rate. An initial enrollment fee was suggested, but ROA testified that if such a fee were put in place, it should be nominal and would only be paid when a beneficiary used Tricare Standard for the first time. ROA was quick to ask about protections for serving reservists, who pay 28 percent of their health care costs, and was assured that beyond annual adjustment to premiums, no additional increases will impact Tricare Selected Reserve. A proposed enrollment fee for Tricare for Life (TFL) also seems unlikely. Hill staffers are aware that TFL beneficiaries already pay Medicare Part B, which adds up to more than any other Tricare beneficiary pays (except for gray-area reservists). Using the excuse that higher retail copayments will be an incentive for pharmacy users to go to home delivery, DoD wants to increase prescription copayments. Copayments for retail pharmacy would triple over five years, while nonformulary would have limited retail access, and home delivery nonformulary copayments would nearly triple over three years. A suggestion was made to make maintenance drug refills mandatory by mail order (allowing for an opt-out) in order to keep copayments low. Congress is hesitant to buy into the recommended fee increases. While the changes are directed toward retirees, elected officials on Capitol Hill are aware that the Active Component is watching how retirees are treated to see how this or any administration “keeps the faith” with those who serve.  O fficer / M ay –J une 2012

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