NewsBytes January 27, 2023
In this issue:
URGENT! CBO Recommends TFL Beneficiaries Pay More for TRICARE
Survivor Benefit Plan Open Season
FRA Participates in Roundtable on Reserve Component Parity
URGENT!
CBO Recommends TFL Beneficiaries Pay More for TRICARE
The Congressional Budget Office (CBO) has recently issued a report recommending two separate proposals to reduce the cost of TRICARE-For-Life (TFL) to help reduce the budget deficit. The CBO recommends that TFL beneficiaries pay the first $850 in healthcare cost and that TFL would only pay 50 percent of the next $7,650 in cost annually.
Currently TFL beneficiaries do not pay an annual enrollment fee. The report recommends TFL beneficiaries pay an annual enrollment fee of $575 for individual coverage or $1,150 for family coverage. The enrollment fees would be indexed to grow at the same rate as average Medicare costs in later years.
Although this has not yet been introduced as legislation, the FRA will oppose any proposal that increases costs to retirees who rely on TFL to supplement their Medicare benefits. Most of these beneficiaries are on fixed incomes and cannot absorb substantially higher health care costs. The FRA opposes these proposed fee increases because the association believes that a military retiree’s healthcare premium is at least in large part, paid for with 20 or more years of arduous military service. Further, the association believes that the Department of Defense must sufficiently investigate and implement other options to make TRICARE more cost-efficient as alternatives to shifting costs to TRICARE beneficiaries.
FRA members are urged to use the FRA Action Center to tell their legislators to oppose these CBO proposals now!
SBP Open Season
An FRA-supported provision in the FY2023 National Defense Authorization Act (NDAA) to provide a Survivor Benefit Plan (SBP) Open Season in the 2023 act. The SBP Open Season has started and ends on Jan. 1, 2024.
The SBP Open Season also allows eligible members and former members who are currently enrolled in either SBP or RCSBP to permanently discontinue their SBP coverage. The law generally requires the covered beneficiaries to concur in writing with the election to discontinue. Previously paid premiums will not be refunded.
The SBP Open Season allows retirees receiving retired pay, eligible members, or former members awaiting retired pay who are currently NOT enrolled in SBP or RCSBP (Reserve Component Survivor Benefit Plan) to enroll. For a member who enrolls during the SBP Open Season, the law generally requires that the member will be responsible to pay retroactive SBP premium costs that would have been paid if the member had enrolled at retirement (or enrolled at another earlier date, depending on the member’s family circumstances).
For more information about SBP open season go online.
FRA Participates in HVAC Subcommittee Roundtable on Reserve Component Parity
ADLP Theo Lawson joined other Veteran Service Organizations (VSOs) and Military Service Organizations (MSOs) in a House Veterans Affairs Subcommittee on Economic Opportunity’s roundtable discussion on parity issues facing reserve and national guard. The roundtable primarily focused on GI Bill Parity, in its recent Consumer Financial Protection Bureau (CFPB) reports on SCRA (Servicemembers Civil Relief Act), and other parity issues.
In recent years, Reserve Components activation has increased drastically and so has the demand for readiness. The FRA supports the GI Bill parity act, which passed the House in the previous session of Congress. The act would ensure that every day in uniform counts for Post 9-11 GI Bill benefits for Reserve Component service members — just as it does for active-duty members.
The roundtable discussed a recent CFPB report revealing that Reserve and National Guard members called to active duty are paying an extra $9 million in interest every year because they are not always receiving the benefit of their right of rate reductions under SCRA. The discussion of the issue focused on why this was happening and offered solutions. Lawson mentioned that monitoring the education of service members’ rights are guaranteed under SCRA. The CFPB report made recommendations to eliminate this problem, including creditors automatically applying SCRA rights using Defense Manpower Data Center SCRA website monthly to identify borrowers eligible for the SCRA interest rate cap.
Lastly, the group discussed other parity issues including healthcare benefits for retired reservists: Currently, a retired reservist would have to wait to receive their first retired pay after the age of 60 to qualify for healthcare benefits. The group proposed having an automatic enrollment of healthcare benefits at the age of 60.
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