Military Update: Servicemembers’ benefits now in committee’s hands
July 6, 2006
Billions of dollars in pay and benefits are at stake for active-duty members, reservists, disabled retirees and surviving spouses as a House-Senate conference committee begins to negotiate differences in separate versions of the 2007 defense authorization bill.
When the process ends, perhaps by late September, military personnel will know the size of their next pay raise; drilling reservists will know if all of them have access to a low-premium health plan; mobilized reservists will know if their GI Bill benefits can be used after they leave service; and users of retail pharmacies will know if military co-payments have increased.
All of these issues are still unresolved.
The Senate passed its 2007 defense authorization bill (S 2766) on June 22, after approving a surprising number of floor amendments to help reserve component personnel and some disabled retirees.
The House had approved its bill (HR 5122) weeks earlier, but without some of the false drama of some of the Senate votes. False in the sense that many Senate amendments to help military constituents are, in fact, unfunded and therefore unlikely to survive negotiations with the House.
Conferees shaping a final authorization bill will know what money is available for some of these personnel only after the Senate passes its defense appropriations bill and reconciles that funding with House appropriations.
Sen. John Warner, R-Va., chairman of the Armed Services Committee, chairs the authorization conference that began work Friday. Among key personnel issues:
2007 pay raise — The House endorsed a 2.7 percent basic pay increase for next January, which would be the seventh consecutive annual raise set a half percentage point above private sector wage growth. The Senate accepted the Bush administration’s call for a 2.2 percent increase. That also matches the figure in the House-passed defense appropriations bill, which could make it difficult for House conferees to defend their bigger pay raise. Both the House and Senate bills support the administration’s call for a special targeted raise in April 2007 for warrant officers and for longer-serving enlisted members in pay grades E-5 through E-7.Reserve Tricare — The House would open a Tricare Standard-like health benefit to all drilling reservists willing to pay premiums set at 28 percent of program costs. The Senate voted merely to improve two of three higher premium tiers approved last year for the Tricare Reserve Select plan. The higher cost of the House plan, about $1 billion a year, makes the more modest Senate plan a likely choice for conferees. Sens. Lindsey Graham, R-S.C., and Hillary Clinton, D-N.Y., drafted the plan, which would broaden TRS eligibility and lower some premiums.Under TRS, Reserve and Guard members who complete post-Sept. 11 deployments can enroll in a Tricare Standard-like program if they pay premiums set at 28 percent of costs plus usual deductibles and fees.
Last year Congress set two new premium tiers, opening TRS to any drilling reservist willing to pay. Regulations to implement three-tier TRS are still being prepared even as the Senate presses for more changes.
The second tier is for reservists who lack alternative health insurance because they are unemployed, self-employed or work in jobs with no health benefits. They will be able to enroll soon in TRS with premiums set at 50 percent of program costs. The Senate this year wants to broaden eligibility for this second tier to reservists in businesses with 20 or fewer employees.
The third tier of TRS is for reservists who have alternative health coverage but choose not to use it. Their premiums are to be 85 percent of program costs. The Senate this year seeks to lower that to 75 percent.
Reserve retirement — The Senate voted to lower the age-60 start of retirement benefits for Reserve and Guard members activated since September 2001. The Senate plan, from Sen. Saxby Chambliss, R-Ga., would start retirement pay and benefits sooner by three months for every 90 days of activation. Thus, a Guardsman called up for a year could retire at 59. The Senate adopted a similar Chambliss amendment last year. It fell out in final negotiations because it wasn’t funded. The House would leave reserve retirement unchanged.
Portable GI Bill — On an amendment from Sen. Blanche Lincoln, D-Ark., the Senate voted to allow reservists who earn GI Bill benefits to be able to use them for up to 10 years after leaving service. Under current law, eligibility ends on separation from service. The House is silent on the issue.
Concurrent receipt — The Senate would accelerate full restoration of retired pay to retirees rated “unemployable” by the Department of Veterans Affairs. Under current law, an end to the ban on concurrent receipt of retired pay and VA disability compensation for these 20,000 disabled retirees won’t occur until 2009. On a floor amendment from Sen. Harry Reid, D-Nev., the Senate voted to shift the effective date back to Jan. 1, 2005. The House is silent on the issue.
Drug co-pays — The House would raise co-payments for prescriptions filled in the Tricare retail network to $16, from $9, for brand-name drugs on the military formulary and to $6, from $3, for generic. The Senate would block any such increase through 2007 on an amendment from Sen. Frank Lautenberg, D-N.J.
SBP changes — The Senate wants to end a dollar-for-dollar “offset” in Survivor Benefit Plan payments that surviving spouses see when they also qualify for VA Dependency and Indemnity Compensation. It also would move the effective date of the SBP paid-up rule up by two years, to October 2006. This would end SBP premiums for participants who have paid in for at least 30 years and reached age 70. The House is silent on this issue too.
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