MOAA Legislative Update: TRICARE Inpatient Fee Hike Prevented

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October 8, 2009

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Colonel Ulses,


TRICARE Inpatient Fee Hike Killed
When the Pentagon announced last week that it would raise inpatient copays for retired TRICARE Standard beneficiaries by $110 per day, MOAA swung into action, writing the Secretary of Defense, contacting the White House, and writing Hill leaders to reverse that plan.
MOAA members did their part by generating almost 20,000 messages to the Hill.
These combined efforts yielded positive results, as the newly released FY2010 Defense Authorization Act includes a provision barring any inpatient copay increase.



New Defense Bill Has Pluses and Minuses
House and Senate leaders finished their negotiations on the FY2010 Defense Authorization Act. As usual, there are many things in it to be pleased about, but several significant disappointments as well. See a brief comparison of the House vs. Senate vs. final provisions here. More details follow below.
House Passes Military Tax Relief
New legislation would restore the tax-exempt status of military homeowner assistance program payments and extend another year to use the first-time home-buyer tax credit for personnel assigned overseas.
Coalition Recognizes Key Legislators and Staffers
On Oct. 6, The Military Coalition hosted a Capitol Hill reception to present its annual awards to two legislators and two Congressional staff members who have championed compensation and benefit improvements for military members and families.

New Defense Bill has Pluses and Minuses
There will be plenty of cheers and plenty of jeers, depending on which issues are most important to you, for the final version of the FY2010 Defense Authorization Act announced this week by House and Senate Armed Services Committee leaders.
First the good news. Among other provisions, the legislation will:
• Authorize a 3.4% pay raise for active duty, Guard and Reserve members (vs. the budgeted 2.9%)
• Bar the Pentagon from implementing any TRICARE inpatient care copay increases for FY2010
• Authorize an extra 30,000 troops for the Army (15,000 above the budget request), and an additional 30,000 in FY2011 and FY2012, provided the Pentagon budgets for the increase
• Authorize premium-based TRICARE coverage for "gray area" reserve retirees who haven't yet attained age 60
• Authorize special compensation on behalf of caregivers of severely wounded warriors while on active duty (tracks with VA "aid and attendance" payments for vets who need caregivers)
• Require retention of wounded Guard/Reserve members on active duty through completion of disability determination process, unless they request earlier release
• Require a medical examination before administrative separation of members affected by traumatic brain injury or PTSD
• Mandate a long list of initiatives to protect absentee voting rights for military members and families
• Extend family medical leave rights to employees who are family members of deploying active duty members
• Expand the window of active-duty TRICARE eligibility for activating Guard/Reserve members/families
• Require a variety of measures to expand beneficiary access to mental health providers
• Authorize $49 million to assist school districts with significant populations of military children
• Authorize active-duty-level dental coverage for children of members who die on active duty
• Establish formal requirements for needs assessment and delivery of assistance to military families with children with special needs
• Authorize a pilot program to create federal internships for military spouses
• Express the sense of Congress that DoD should authorize Flexible Spending Accounts to let currently serving military members set aside pre-tax dollars to cover out-of-pocket medical and dependent care expenses
• Require a DoD plan to improve access of beneficiaries to health care providers
• Establish a new DoD Task Force to assess progress on care, management and transition of recovering wounded, ill and injured servicemembers
Unfortunately, the new legislation also produced some significant disappointments in that it:
• Dropped the House plan to phase out the disability offset to retired pay for medically retired (chapter 61) members. This is a particularly devastating setback because, for the first time, the President’s budget had included this measure, and House leaders had found funding for the first year. Some in the Senate objected to the specific funding sources identified by the House, and leaders could not find other offsets to comply with Senate budget-scoring rules
• Dropped the Senate initiative to repeal the deduction of VA survivor benefits from military SBP annuities, again for lack of funding offsets
• Reduced the Senate-approved Army manpower level by 15,000 for FY2010 (though it did provide extra increases in 2011-12). MOAA had urgently supported the extra increase for FY2010 to provide much needed relief for Army families affected by grievous over-deployment of a too-small force
• Dropped a Senate-approved provision to authorize retroactive Reserve retirement age credit for active duty service since Sept. 11, 2001 (current law credits only service since Jan. 28, 2008), again for lack of funding offsets
• Dropped a House-passed provision to authorize shipment of a second personal vehicle for members on PCS orders to Hawaii, Alaska, or US territories
• Authorizes daily proration of combat and hazard pays (under current law, any part of a month in a combat zone triggers pay for the month). MOAA believes this is an over-reaction to reports of abuse (e.g., scheduling two-day in-theater trips starting the last day of the month) that would have been better addressed by a requirement to spend more than 30 days in theater to receive more than one month’s pay credit
• Dropped a Senate-passed provision that would have allowed military spouses to choose to establish the same domicile as their servicemember for voting and tax purposes
• Dropped a Senate-passed provision expressing the sense of Congress that military retirement and health benefits are the primary offset to the extraordinary demands and sacrifices inherent in a military career, that career members deserve a health benefit commensurate with their sacrifices, and that DoD needs to look at other ways to reduce health care spending than shifting more costs to beneficiaries
MOAA continues to be extremely frustrated by Congress' selective application of budget rules. In recent years, those rules have been routinely waived to pass trillions of dollars in tax reductions, stimulus packages, and bailouts of all sorts (which, to be fair, have included such things as the new GI Bill and military homeowner tax relief), while denying relief to tens of thousands of even more deserving groups whose military service cost them their health, their livelihood and the very lives of their loved ones.
We pledge to continue beating against this arbitrary budget wall until it comes down.
Many in Congress are, in fact, doing their level best to get these things done, and share our frustration at being turned back again and again by budget rules that seem to get tougher each year for our disabled and survivors simply because Congress has kept waiving the rules for so many others that deficits continue to mount ever higher.
That rationale simply doesn't fly when, year after year, so many big-ticket, politically expedient issues continue to be exempted from the so-called rules while disabled retirees, military widows and Guard/Reserve members with multiple combat tours since 9/11 repeatedly get left with the short end of the budget stick.
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House Passes Military Tax Relief
On Oct. 8, the House of Representatives passed legislation (HR 3590) incorporating several tax relief measures affecting military people.
Most significantly, it would restore tax-exempt status for military Homeowner Assistance Program payments to certain servicemembers, wounded warriors and survivors who had to sell their homes in conjunction with military relocations and were upside down on their mortgages.
In the past, HAP payments have been exempt from taxation, but a glitch in the legislative language of the economic stimulus package approved early this year inadvertently took away the tax exemption. In some cases, that would have cost affected members $10,000 or more. Assuming the Senate follows suit as expected, they’ll be able to breathe a big sigh of relief.
In addition, the bill would extend the first-time homebuyers' tax credit, another economic stimulus provision, by one year for members of the armed forces, Foreign Service and intelligence agency personnel who are serving overseas in 2009.
The bill, sponsored by Representative Charles Rangel (D-NY), passed by a vote of 416-0. The bill will authorize the tax credit, a maximum of $8,000, through Nov. 30, 2010 for members who had at least 90 days of overseas-duty assignments during 2009.
The legislation will also waive the requirement to repay the tax credit for service personnel who are reassigned on extended government orders within three years of purchasing their first home. Under current law, anyone who sells the home within three years after purchase must repay the tax credit.
For more information on the HAP program click here.
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Coalition Recognizes Key Legislators and Staff
On Oct. 6, The Military Coalition (TMC) presented its highest awards (first announced in August) to two legislators and two Congressional staff members who have championed legislative improvements for military families.
Sen. Blanche Lincoln (D-AR) was presented the TMC Award of Merit for her leadership in sponsoring legislation to improve National Guard and Reserve GI Bill benefits, provide tax relief for certain disabled military retirees, and improve compensation for military widows.
Rep. Joe Wilson (R-SC) received the same award for his leadership in supporting military pay comparability with the private sector; retirement equity for Guard and Reserve members activated since Sept. 11, 2001; military health care improvements; and elimination of compensation inequities for disabled retirees and military survivors.
Colonel Steve Strobridge (USAF-Ret), TMC Co-Chair and Government Relations Director of MOAA said, "Senator Lincoln has been in the forefront of multiple initiatives to improve the quality of life for the military community. Her efforts paved the way for adoption of an 'earn as you serve' principle for activated reservists to qualify for the Post-9/11 GI Bill."
Michael Cline, TMC President and Executive Director of the Enlisted Association of the National Guard of the United States, said, "As Ranking Minority Member of the House Armed Services Military Personnel Subcommittee, Rep. Wilson has played an influential role on almost every aspect of military personnel and compensation improvements this year. We’re especially grateful for his leadership in working to improve this year's military pay raise and seeking fairer retirement and health care coverage for the Guard and Reserve community."
Congressional Staff members Ms. Allison Witt, Legislative Director for Rep. Robert Latta (R-OH) and Mr. Tony McClain, Military Legislative Assistant for Sen. Lincoln were presented the annual Freedom Award for their work promoting support for military issues behind the scenes.
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Health Care Happenings Keeps You Informed
Meet MOAA's new health care lobbyist and get the latest updates on TRICARE issues and national health reform.



Housing Assistance Program Update
Last week the Pentagon started processing applications for the Housing Assistance Program (HAP). HAP provides partial reimbursement for certain military homeowners for losses on sales of their primary residence.






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