NATIONAL ASSOCIATION FOR UNIFORMED SERVICES STATEMENT BEFORE THE UNITED STATES SENATE APPROPRIATIONS DEFENSE SUBCOMMITTEE BY BENJAMIN H. BUTLER Legislative Director
May 5, 2004
INTRODUCTION
Mister Chairman and distinguished members of the Committee, The National Association for Uniformed Services (NAUS) is very grateful for the invitation to testify before you about our views and suggestions concerning the following defense funding issues:
SURVIVOR BENEFITS PROGRAM (SBP) IMPROVEMENTS
Age 62 Survivor Benefits Program Offset The National Association for Uniformed Services primary survivor goal is the elimination of the age 62 Survivor Benefit Program annuity offset. This would increase the annuity from 35 percent to the original 55 percent. Not only were many of the earliest enrollees not provided the full explanation of the benefits and the Social Security Offset, but the Federal Government provides a substantially higher annuity with no offset for federal Civil Service survivors annuities.
Position: We urge the committee to provide funding for the annuity increase as described in S. 1916, and end the often-devastating effects of the offset.
30 Year Paid-Up Status A secondary goal is the acceleration of the paid-up provisions by changing the effective date from October 1, 2008 to October 1, 2004, one year beyond the 30th anniversary of the program. Enrollees who have reached the age of 70 and have paid their SBP premiums for more that 30 years (360 payments) are already being penalized.
Position: We ask that you provide funding to allow those early enrollees to be allowed this relief as described in S. 2177.
Survivor Benefits Program / Dependency and Indemnity Compensation Offset Currently, if the retired military sponsor, who enrolled in the Survivor Benefits Program, dies of a service-connected disability, the surviving spouse is eligible for both the SBP annuity and Dependency and Indemnity Compensation (DIC) from the Department of Veterans Affairs. However, the SBP annuity is offset by the full amount of the DIC annuity. Each program’s purpose is different, SBP’s goal is to provide for the loss of the sponsors earned retired pay, and DIC’s goal is to provide the surviving spouse compensation for the loss of their spouse due to injuries caused by his/her service to the country.
Position: The National Association for Uniformed Services strongly urges funding for S. 585. MILITARY EXCHANGES AND COMMISSARIES Issue One-- Why would the Department of Defense want to reduce the commissary benefit at its greatest time of need? The answer is money. DoD wants to reduce the subsidy for the commissary system that provides food and other essentials to troops and families around the world, which will end up in the military community losing the benefit. Examples of this include a recent proposal studied by DoD to implement a policy of variable pricing at military commissaries that would actually reduce the savings to the military customer. While the variable pricing study requested by DoD does not seem to offer a favorable recommendation, we are concerned that additional bad ideas like this will be generated in the future that will ultimately hurt the benefit.
NAUS understands the importance of saving scarce taxpayer’s dollars. Every taxpayer dollar collected must be used wisely to keep down the amount of taxes the government collects; this is only common sense. Therefore, every government agency, department or system must be as efficient as possible. For example, the leaders of the commissary system have been and are continuing to make internal changes to improve efficiencies and reduce overhead operating costs. DoD should be setting goals, not mandating changes.
Position: The National Association for Unformed Services strongly urges you to continue to provide the funding for the Commissary Subsidy to sustain the current services. Commissaries are a key component of the military pay and compensation package. Any action that reduces the benefit means a diminished quality of life and more out of pocket costs.
Issue Two- -The Department of Defense is planning the consolidation of the Armed Services three-exchange services into one single entity, though still retaining the “look and feel” of each store and maintaining the service culture to which the patrons are accustomed. The goal again, is to save money by elimination of redundant overheads, delivery systems, and the power of economy of scaling purchasing.
Position: NAUS does not endorse a consolidation, especially if consolidation is for consolidation’s sake. Streamlining, improving internal operations and implementation of cost saving measures must not reduce the value of the benefit. NAUS supports funding for system studies, but not an accelerated consolidation.
CURRENT AND FUTURE ISSUES FACING UNIFORMED SERVICES HEALTH CARE The National Association for Uniformed Services would like to thank the Sub-Committee and the Full Appropriations Committee for its leadership in the past for providing the landmark legislation extending the Pharmacy benefit and TRICARE system to Medicare eligible military retirees, their families and survivors, making the lifetime benefit permanent, establishing the DoD Medicare Eligible Retiree Health Care Fund, reducing the catastrophic cap and making other TRICARE improvements. However, we must again urge that the Senate provides full funding of the Defense Health Program.
A recent action in the Washington DC area illustrates the impact that funding can have on the health care benefit. According to a document from a MTF commander in the Washington DC area, which may duplicate similar notices issues by other MTF commanders around the country, “Our nation is at War. As a result, this is an exceptional tight fiscal year for which no supplemental funding is anticipated.”
Consequently, within the Fort Belvoir Health Care Network, which is a part of the Walter Reed Army Medical Center network, enrollment in TRICARE Prime for new enrollees is restricted to Active Duty (AD) and Active Duty Family Members (ADFM) only. New retirees and family members, under age 65, may enroll only with a civilian primary care manager. Furthermore, enrollment in TRICARE Plus (for retirees/family members over 65) is no longer available to new enrollees, or the Prime enrollees aging into Medicare.
In addition, certain special services within the network are limited and beneficiaries may not have access to Urology, Physical Therapy, and Optometry; and, for certain the Fort Belvoir Ear Nose and Throat clinic because of its closure.
We are concerned that what is happening locally within the Washington DC area will be duplicated across the country and within all MTF and TRICARE Networks.
And, these actions go beyond just patient access. For example is affects the entire military medical department. For example, doctors need to have access to patients with medical conditions to practice and develop their skills. Without patient access and skill development of doctors and teams required for delivery of high quality general and specialized procedures – there is a tremendous adverse affect on military medical readiness. Especially affected are fields like cardiothoracic surgery, urology, general surgery, ophthalmology and internal medicine. Does the military have no further need for doctors treating Ear, Nose and Throat problems?
Other concerns are: • How will the remnants of the military medical departments be able to take care of troops involved in the various theaters of operations that are or will be involved in fighting the War on Terror? • Will urologist/general surgeons be reduced to treating routine situations on an active duty only population within the United States? • If so, how do can DOD interest them in remaining on active duty? Most retirees and their family members under the age of 65 join TRICARE-Prime to continue care in the military system. Forcing them out of military care denies them the care they want and doctors the full range of patients they need for their training and skills. • What about the retired Medical Corps officers that were lured to return as civilian doctors to staff MTFs?
Many in military medicine have been concerned for years about the eroding patient base. Closing TRICARE-Prime to retirees and their family members at the base level accelerates the erosion of the referral base to military medical centers where most of the specialized training takes place.
Funding shortfalls that are more than likely a reaction to a mid-term budget review and other DOD imposed restrictions that causes MTF commanders to cut off retirees from direct military medical care and that forces them to seek care in the civilian sector has the potential of harming the military medical departments.
We are also concerned about staffing MTFs with “temporary” hire physicians. After witnessing an ever changing medical program that has no job security, what kind of physician can be found to work in such an environment? Would they be the ones at the end of their careers that are anxious to leave at the first sign of trouble or a better job? Additional questions also arise concerning the time, money, and effort was used to secure contract physicians in the first place.
Not all retirees are old. Many are retiring at the 20-year point between the ages of 37-42. Others, many who are now patients at our military medical centers are being treated for wounds received in Iraq and other places, and will be placed on the retired list while they are in their very early 20’s or 30s. What reaction can we expect from these wounded troops after being told that if they stay in the military or are medically retired will be persona non grata in the direct care system at age 65?
Mr. Chairman, the overall goal of the National Association for Uniformed Services is a strong National Defense. We believe that comprehensive, lifelong medical and dental care for all Uniformed Service beneficiaries regardless of age, status or location furthers this goal. As evidenced by the recent changes in the military health care system locally none of these goals can be achieved without adequate funding, and without the people to work on, the skills that are so important to our military doctors could diminish.
FEHBP The National Association for Uniformed Services has been a long time proponent of legislation that would provide military personnel the option of participating in the Federal Employees Health Benefit Program. Though confident that the TRICARE program and the TRICARE for Life program will be successful, because they are an outstanding value for most beneficiaries, in a few cases, the TRICARE/TRICARE for Life options may not be the best choice, or may not be available for the eligible beneficiary. For that reason, we believe the FEHBP option should be enacted. Providing the FEHBP, as an option would help stabilize the TRICARE program, provide a market based benchmark for cost comparison and be available to those for whom TRICARE/TRICARE for Life is not an adequate solution.
Position: NAUS strongly urges the committee to provide additional funding to support a full FEHBP program for military personnel as an option.
Include Physician and Nurse Specialty Pay in Retirement Computations Results of a recent Active Duty Survey show that pay and benefits are the most important factors impacting retention. Improving specialty pay/bonuses and including specialty pay/bonuses in retired pay calculations would aid retention. Therefore, prompt action to retain these and other highly skilled medical professionals is needed.
Position: The National Association for Uniformed Services requests funding to allow the military physicians and nurses to use their specialty pay in their retirement computations. The military services continue to lose top quality medical professionals (doctors and nurses) at mid-career. A major reason is the difference between compensation levels for military physicians and nurses and those in the private sector.
Permanent ID Card for Dependents Age 65 and Over. One of the issues stressed by NAUS is the need for permanent ID cards for dependents age 65 and over. With the start of TRICARE for Life, expiration of TFL-eligible spouses’ and survivors’ military identification cards, and the threatened denial of health care claims, causes some of our older members and their caregivers’ significant administrative and financial distress.
Formerly, many of them who lived miles from a military installation or who lived in nursing homes and assisted living facilities just did not bother to renew their ID card at the four-year expiration date. Before the enactment of TFL, they had little to lose by doing so. But now, ID card expiration cuts off their new and all-important health care coverage.
A four-year expiration date is reasonable for younger family members and survivors who have a higher incidence of divorce and remarriage, but it imposes significant hardship and injustice to the more elderly dependents and survivors.
NAUS is concerned that many elderly spouses and survivors with limited mobility find it difficult or impossible to renew their military identification cards. A number of seniors are incapacitated living in residential facilities, some cannot drive, and many more do not live within a reasonable distance of a military facility. Often the threat of loss of coverage is forcing elderly spouses and survivors to try to drive long distances to get their cards renewed. Renewal by mail can be confusing and very difficult for beneficiaries or their caregivers. The bottom line is that those who cannot handle the daunting administrative requirements to renew their ID card every four years potentially face a significant penalty.
Position: NAUS urges that the Subcommittee direct the Secretary of Defense to authorize issuance of permanent military identification cards to uniformed services family members and survivors who are age 65 and older, with appropriate guidelines for notification and surrender of the ID card in those cases where eligibility is ended by divorce or remarriage.
CONCLUSION Mr. Chairman and distinguished members of the Sub-Committee, we want to thank you for your leadership and for holding these hearings this year. You have made it clear that the military continues to be a high priority and you have our continuing support.
