2-17-12

DoD FY 2013 Budget Provisions Devalue Military Service

The Administration released its proposed FY 2013 budget this week, including plans to drastically increase existing TRICARE Prime enrollment fees, implement new fees for TRICARE Standard and TRICARE-for-Life beneficiaries, and increase pharmacy co-pays. FRA’s National Executive Director (NED) Joe Barnes and Healthcare Advisor Bob Washington met with TRICARE Management Activity (TMA) leadership for a briefing on these and other changes to the Military Health Service (MHS) outlined in the budget. Additionally Senator James Webb (Va.), chairman of the Senate Armed Services’ Military Personnel Subcommittee, met with FRA and other Military Coalition leaders at FRA Headquarters today to discuss national security, personnel and veterans issues.

The budget proposals are in addition to the 13-percent TRICARE Prime fee hike imposed for this year and, if approved, would be tiered based on the beneficiary’s retired pay.

TRICARE Prime family enrollment fees, which were recently increased to $520 per year for all beneficiaries, would increase in FY 2013 to between $600 and $820, based on retirement pay. The fees will continue to increase annually until FY 2017, when beneficiaries will pay between $893 and $2,043 per year. 

TRICARE Standard and Extra families would see a new annual enrollment fee of $140 in FY 2013, which will gradually increase to $250 by FY 2017. After that, the annual fee will be indexed to healthcare inflation. 

A new enrollment fee would also be implemented for TRICARE-for-Life (TFL) families beginning in FY 2013. The new tiered fees will range from $35 to $115 per year and will be increased through FY 2016 to between $150 and $450 based on retired pay.

Individual annual enrollment fees for Prime, Standard, and TFL would be half of the family fee indicated above. After FY 2017, the fees will rise based on healthcare inflation. Pharmacy co-pays would also rise according to the plan, with brand name retail prescriptions ($12 for a 30-day supply) and home-delivery ($9 for a 90-day supply) both increasing to $34 by FY 2017. The cost for generic medications obtained from retail pharmacies is slated to increase from $5 to $9 over the next five years.   Non-formulary retail prescriptions would be eliminated and non-formulary mail-order co-pays would gradually increase from $25 to $66 by FY 2017. There will be no pharmacy co-pays for generic home-delivery until FY 2017, when it would be set at $9. No co-pays will be required for prescriptions filled at Military Treatment Facilities (MTFs).

FRA strongly opposes these drastic increases and believes they will substantially erode the value of military retired pay. Further, FRA believes these budget proposals devalue military service.

The budget also calls for a commission to study and propose changes to the military retirement system. This BRAC-like process bypasses the expertise of the Senate and House Armed Services Committees and subcommittees and only allows Congress an up-or-down vote on the commission’s recommendations. The budget also requests a 1.7 percent increase in active duty and Reserve pay that is equal to the Employment Cost Index (ECI), and makes deep cuts in Army and Marine Corps end strength over five years.

Members are strongly urged to visit www.fra.org/tricarefee, where they can send a pre-written e-mail message regarding these proposals to their elected officials.