In this issue:

• Defense Panel Authorization Bill
• Not So Super Committee
• Paper: Military Retiree HealthCare Faces a Triple Whammy

DEFENSE PANEL REVISES AUTHORIZATION BILL

The fiscal 2012 Defense authorization bill was reworked by the Senate Armed Services committee last week to align it with spending levels proposed in the defense spending bill and the August debt limit law.  The bill, originally approved by the committee in June, would cut an additional $21 billion in Defense Department programs.

The revised bill would authorize $662 billion for national defense programs including $527 billion for the base Defense Department budget and another $117 billion for Overseas Contingency Operations.  It also includes $17.5 billion for defense programs in the Department of Energy.  The bill is $27 billion less than the President’s budget request and $43 billion less than the amount enacted for fiscal 2011.

The revised bill would cut:

* $330 million for private-sector care under the Defense Health Program
* $527 million from military construction projects
* $244 million from space programs
* $2.8 billion for the Army procurement budget
* $800 million for Army research and development

Once the committee approved the bill, it was taken up by the full Senate.  On Friday, they approved several non-controversial amendments including one that would require a report on the implementation of the recommendations in the 2010 Army acquisition review panel’s final report and another that would require the comptroller general at the Defense Department to report to Congress on employment programs for military spouses.

The Senate is expected to resume debate on the bill after they return from the Thanksgiving recess.

What’s next:  After the Senate passes the bill, it will go to conference to iron out any differences with the House version.

NOT SO SUPER COMMITTEE

The Joint Select Committee on Deficit Reduction (super committee), created as a part of the August Budget Control Act, must vote by no later than midnight 23 November on a plan to cut the deficit by at least $1.2 trillion over the next 10 years.  Unfortunately, it appears that they are deadlocked and will not meet their deadline.  If that happens, a sequester would be triggered that could lead to up to $500 billion more in defense reductions beginning n 2013.  Whether Congress will allow sequestration to occur will probably not be addressed until next year. 

One member of Congress that is not taking this lightly is Rep. Buck McKeon, R-Calif., chairman of the House Armed Services Committee.  In a letter to super committee leaders, he warned that their failure to achieve a deal would have an immediate consequence of a 25 percent reduction to the defense budget in fiscal 2013.

McKeon said, "If sequester were to occur, the impact on our national security, our men and women in uniform, and the Department of Defense would be immediate, dire, and in some cases irrevocable.  Congress can negotiate our way through impasses, but the Department of Defense is required to plan with the budget authority it is given."

As the FY13 budget is due early next year, a failed agreement would force the Defense Department to begin deep and irrevocable cuts out of our armed forces next year in order to reap the saving in 2013.  Once this process is set in motion, it will be difficult - if not impossible - to stop."

The sequestration scenario would include freezing defense assembly lines and shipyards across the nation, issuing pink slips to hundreds of thousands of active duty military, industry workers, and civilian defense personnel.  "We would cripple our ability to properly train and equip our force, significantly degrade military readiness.  Our ability to respond to national security crises or humanitarian disasters would be disrupted, and we would risk losing the technical and competitive edge that has traditionally given our troops a decisive advantage on the battlefield."

AUSA applauds Chairman McKeon and his strong stand against further cuts to the defense budget.  


PAPER: MILITARY RETIREE HEALTH CARE FACES A TRIPLE WHAMMY

With all of the talk swirling about cuts to the defense budget and to military retiree’s earned benefits, we would like for our readers to take a look at AUSA’s latest Torchbearer Issue paper.  Produced by the Institute of Land Warfare, the paper specifically targets threats to Medicare, TRICARE enrollment and the TRICARE pharmacy program. 

The paper identifies three important trends with regards to Medicare:

* Annual Part B premium increases have not only been steep but have also proved highly erratic and unpredictable;
* Annual cost-of-living adjustments (COLAs) to military retired compensation and Social Security benefits have not kept pace with the rapid rise in Medicare premiums; and,
* Because Medicare Part B premiums are “means-tested”; i.e., retirees with higher individual or family incomes pay even higher Part B rates.

The other two sections, TRICARE enrollment and the TRICARE pharmacy program, deal with higher fees and how such increases are consuming an ever greater percentage of military retirees’ incomes at a stage in their lives when they may not have much financial flexibility. In contrast, the quality and accessibility of their care is simultaneously decreasing.

In conclusion, the paper states, “To date, no single legislative action or major proposal has placed an unbearable health care burden on the military retiree, but the cumulative effect of numerous small cost increases approaches such a burden. Cost increases have been individually modest but indexed. Collectively, they have already had an impact on retired servicemembers and threaten an even greater impact in the future”

Military careers of sacrifice and civilian employment—and the compensation appropriate for each—are inherently incomparable. The nation can afford to keep its critical All-Volunteer Force and pay for the benefits owed to the select few who earn them. For example, one way of reducing unsustainable growth in Defense Department health care costs without adding further to the burden shouldered by military retirees is to offset any new access fees by reducing retirees’ Medicare premiums by like amounts. The nation’s debt crisis cannot and should not be alleviated on the backs of those few who answer duty’s call.”

Here is the link to the paper.  http://www.ausa.org/publications/torchbearercampaign/torchbearerissuepapers/Documents/TBIP_Retirees_web.pdf