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25 February 2016 Legislative News Update

Association of the United States Army Logo - Eagle with Shield, Torch, Olive Branch
Thursday, February 25, 2016

weekly electronic newsletter, and is published 
every Thursday when Congress is in session.

 

 

 

 

 

★★★

POSTURE ACT COULD STOP ARMY TROOP CUTS

The Feb. 17 AUSA Legislative Update reported on a bill introduced by Reps. Chris Gibson , R-N.Y., and Mike Turner, R-Ohio that would limit reductions in the Army and Marine Corps until 2017, a pause that would allow the next president to assess land force capabilities and needs before deciding troop levels.

We fully support the POSTURE Act.  AUSA President Gen. Gordon R. Sullivan, USA, Ret., said that “the bill puts the brakes on force reductions that could leave the Army too small to carry out its wartime and peacetime missions.  Before continuing the downward plunge of our Regular, Guard and Reserve Army, we should look up from the hole we are digging to see how an already dangerous world is becoming even more unstable.”

The legislation currently has 23 co-sponsors (17 Republicans and 6 Democrats). 

As always, how to pay for the legislation is a problem.  However, there is time to think about funding because the House Budget Committee has delayed its work on the fiscal 2017 budget resolution. 

In this week’s hearing on the Army’s fiscal 2017 budget, Army Chief of Staff Gen. Mark Milley told the Senate Appropriations Committee that stopping the drop in Army strength would improve readiness, but only if money is provided to cover the costs.  Having a bigger Army that isn’t funded would not be helpful, he said.

Please add your voice to ours.  Click here to let your elected officials know that you support the POSTURE Act. 

PENTAGON OUTLINES HEALTHCARE “MODERNIZATION” PLAN.  AUSA RESPONDS

AUSA and its partners in The Military Coalition (TMC) provided testimony for a hearing held by Senate Armed Services Personnel Subcommittee on military healthcare.   

In addition to fee increases, the Defense Department’s fiscal 2017 budget request proposes that the military health system be reorganized.  In his testimony, Dr. Jonathan Woodson, Assistant Secretary of Defense (Health Affairs) said, “In our FY17 proposed budget, we introduce a new approach to the DoD health benefit that further simplifies the program for beneficiaries.  Patients would be able to choose between a managed benefit that prioritizes care in the MTFs (and continues to offer MTF care at no cost to beneficiaries), and an unmanaged option that sustains the freedom of choice for beneficiaries to seek civilian care without restriction.”

The plan would provide TRICARE beneficiaries with two health care alternatives:  TRICARE Select, (currently the HMO-MTF centric option) or TRICARE Choice (currently TRICARE Standard and Extra). 

TRICARE Select beneficiaries would pay reduced fees and co-payments, and would primarily use military hospitals and clinics.  Enrollees in this option would have no cost sharing for care received in those locations.  The reduced cost structure is also designed to incentivize beneficiaries to obtain their care in the MTFs with the goal of maximizing MTF use and enhancing training/professional skills of military providers. 

AUSA/TMC position:  We generally concur with the goal but with reservations.  Acknowledged problems with access to care and a flawed referral system still plague MTFs and clinics.  Therefore, we remain deeply concerned about the MTFs’ ability to absorb new beneficiary demand with existing capacity.  It’s one thing to say those chronic problem areas will be fixed; it’s another thing entirely to ensure those fixes are implemented successfully.  We are very concerned these proposals are built upon so-far-unfulfilled commitments to fix them.   

The second option, TRICARE Choice, would provide an un-managed plan for the largest share of beneficiaries.  It proposes to arrange for PPO-style provider networks, with the stated goal of establishing networks sufficient to provide care for 85 percent of participating beneficiaries. 

The DoD plan hits retirees under age 65 the hardest by imposing enrollment fees regardless of which program they choose.  TRICARE Select participants would pay $350 individual/$700 family, a 24% increase from the current fee.  TRICARE Choice enrollees would pay $450 individual/$900 family.  AUSA/TMC position:  We remain concerned about providers who are unwilling to accept TRICARE’s lower reimbursement payments.  How robust will the system be?  TRICARE Choice enrollees would pay enrollment fees but would not be guaranteed access to care. 

Effective 1 January 2017, new entrants to the TRICARE For Life program would be required to pay an enrollment fee which would be tied to retired recipients’ income.  The fees would initially be set at 0.5% of retired pay, rising to 2% of retired pay for a TFL-eligible couple, to be phased in over 5 years and would be accompanied by a complicated system of fee caps, one for flag officers and one for lower grades.  AUSA/TMC position:  We do not support means-testing which imposes financial penalties for longer and more successful service on a population that is already paying the highest fees of any military beneficiaries.  When establishing this program Congress expressly prohibited a separate enrollment fee for TFL.  They acknowledged that this group already incurs higher costs than other military beneficiaries by virtue of being required to pay Medicare Part B premiums. 

Other budget items include:

  • A request to increase pharmacy fees.  Fees would double over ten years.  AUSA/TMC position:  Pharmacy fees have already increased five-fold over the last few years.  In many cases, current copayments are already at or above corporate insurance medians.

 

  • Open season enrollment.  Participants must enroll for a 1-year period of coverage or lose the opportunity.  AUSA/TMC position:  We strongly oppose this proposal.  We believe that no eligible beneficiary should be denied their service-earned healthcare coverage.  If there is to be an enrollment requirement, any eligible beneficiary should be enrolled automatically upon seeking care.  As it has for decades, the military ID card should serve as proof of enrollment.

 

  • Fees and copays that would be indexed to medical inflation.  This proposal would provide annual adjustments of the fees and co-payments to the national health expenditure index, which is projected to rise at 6.2% per year.  AUSA/TMC position:  We agree with the methodology previously approved by Congress that annual increases should not exceed the percentage growth in military retired pay (i.e., inflation as measured by the Consumer Price Index).

Military healthcare reform is a stated goal of both the Senate and House Armed Services Committees this year.  Both committees have said they intend to study all aspects of the benefit, and improve those areas that are not meeting the standard.  It’s important to remember that the budget request and associated hearings are just the first steps in a long process.  AUSA and its partners in The Military Coalition will be working closely with the defense committees to find solutions to the identified problems. In doing so, we will continue to remind all parties that TRICARE is not an entitlement, rather it is an earned benefit.