The News Courier in Athens, Alabama

State and Nation

April 8, 2013

Pentagon struggles with high cost of health care

(Continued)

The provision in the spending bill blocking an enrollment fee had widespread support among Republicans and Democrats, according to congressional aides. The Pentagon, nonetheless, is expected to ask again in the 2014 budget for an enrollment fee.

The department also is likely to seek increases in fees and deductibles for working-age retirees and try again to peg increases in them to rising costs as measured by the national health care expenditure index produced by the Centers for Medicare and Medicaid Services. That index rose 4.2 percent in 2012 and is projected rise by 3.8 percent this year.

In recent years, Congress has agreed to tie any future increases to the typically smaller percentage increase in military retirees' cost-of-living adjustment, which this year is 1.7 percent.

Either way, a military retiree under age 65 and their family members pay a far smaller annual enrollment fee than the average federal worker or civilian — $230 a year for an individual, $460 for a family. There is no deductible.

Lawmakers' other response was to establish the Military Compensation and Retirement Modernization Commission to study the issue of benefits and offer recommendations on how the Pentagon can address the problem. The commission was created in this year's defense authorization bill.

"Nobody wants to touch it because people are confused about who it impacts," said Lawrence Korb, a former assistant defense secretary and now a senior fellow at the liberal-leaning Center for American Progress. "It's not going to impact people on active duty. It's not going to impact veterans because they're taken care of by the VA. Basically (it's) working-age retirees."

Korb said he wished Hagel has been more explicit in his warning about the impact of benefit costs.

"He did lay it out that we're going to have to do something or we're going to end up like General Motors and spending everything on people not working for us anymore."

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