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Pay Freeze and the Cost of TRICARE

By Mark Gibson
AFGE Field Services Department

While there is a whole lot of wrong with “freezing” federal employee pay for the next two years, I intend to make one argument at a time. I do this for a very specific reason.

I want to make sure that the Administration and this new Congress “gets it”. Freezing federal employees pay without imposing other cost saving measures is unfair to federal employees, their families and the communities they live in.

The National Defense Authorization Act for Fiscal 2011 approved $726 billion for defense spending this fiscal year. One provision of that “act”, freezes military and retiree co-payments through 2011 at 2006 levels for the service members’ medical care program, Tricare.

This “earmark” also includes the purchase of drugs, and freezes cost for inpatient hospital care.

On average, health care coverage for civilian federal employees and retirees will average an increase of 7.2 percent this year. This of course is an increase from the costs levied in 2010 and not those held at 2006 rates.

The Department of Defense has acknowledged that it’s spending on military health care is rising twice as fast as the nation’s overall health care costs. An increase from $19 billion in 2001 to and estimated cost of $50.7 billion this year (2011) a rise of 167%. Comparatively, U.S. spending on health care rose from $1.5 trillion in 2001 to nearly $2.7 trillion projected for 2011. An 84% increase. 9% of the Department of Defense’s spending is used for health care.

TRICARE, the military’s health benefit program has seen a jump of beneficiaries of 370,000 in the past two years. Today, there are some 9.6 million service members, family members and military retirees covered by TRICARE.

The recent “pay freeze” of over 2 million federal employees does not include military personnel who will receive a pay increase in 2011 and likely will see another raise in 2012. Unlike federal employees, who will experience an average increase in health insurance costs of 7.2 percent this year, those receiving the pay increase will not experience an increase in the cost of their health care.

The pay freeze is expected to save the government about $5 billion over two years according to the White House. It will, taking into consideration the rising cost of health care, and everything else, amount to a decrease in federal employee pay.

Retiree beneficiaries of TRICARE get the same benefits as the active duty service member by paying a $230 individual or a $460 family premium each year. They also must pay a small co-payment for various types of care. These fees have not gone up since 1995.

Of the projected 2 million federal employees who will not see a raise the next two years, over 700,000 of them work in the Department of Defense.

So while Congress spends money trying to eliminate “ObamaCare”, the taxpayer will continue to cover the cost of socialized health care for the military and its retiree’s. In this debate, they will consider that members of the military and their family members vote, as do those retired from the military. They will consider the risk they run in angering veterans groups as well as those who profess that America’s democracy has turned to a socialist form of governance.

And they will do so with the elections of scheduled for 2012 in mind and with the comfort that America’s civil servants are footing the bill.

These thoughts are my own and may not be reflective of the views or position of my employer.

Mark Gibson

3 Responses

  1. Hi: I would like to see a story in the Tyler Paper about the Retired Vets here in Tyler and what they think of the Tricare System and the increase of the payments.

    I believe that most people have no idea what Tricare is and that Retired Vets get Free health care anyway.

    I will be more than happy to tell you my story on Tricare as I think other Vets here in Tyler will too.

    This is what I wrote to Mr. Gates today.

    When I came into the US Army in 1970 I was told that my spouse and I would have Free medical care for life if I served 20 years. I did my 20 at the end of 1992. Little by little the free went out the door.

    Yes $460.00 is very good for my Spouse and I. We still have co pays and is very hard to find some doctors to take Tricare.

    I had many jobs after I got out of the Army not one of them had a health plan.

    I have not been able to work a full time job sense Jul of 2004 because of back problems. How many more Vets are out there like me between 50-65 in the same shape as I?

    An increase in Tricare will only make our live harder to live.

    Thank You

    Ret. SFC Johnny Hastings 903-316-1238

  2. Military Retirees have paid their premiums
    Military retirees have paid their premiums by time and service rendered. Although budget items are of great concern, how do you take or cut from those who already paid. In many circumstances, the price they have paid is far more then the benefits they have earned and are entitled to.

    There are areas in TRICARE that the DoD can work to reduce the overall budget and at the same time, not hurt the beneficiary. TRICARE Standard is by far the best plan for retires vs. Prime, this is a good starting place for the DoD to consider. Even though TRICARE Standard is a good place for the beneficiary, they still need a TRICARE Supplemental Insurance Plan http://www.tricaresupplement.us/

    We are concerned DoD will hurt the benefits of the Military Retirees & we agree the budget needs better control on spending in other areas. Keep in mind, after a tour of duty, many fine Americans return home with injuries and disabilities that last the rest of their lives

  3. To: All,
    I hope that you can see through the BS that Mr. Gibson is spouting in his article. As a retired military member I would say this to you sir. In your article of which I will quote from, “The Department of Defense has acknowledged that it’s spending on military health care is rising twice as fast as the nation’s overall health care costs. An increase from $19 billion in 2001 to and estimated cost of $50.7 billion this year (2011) a rise of 167%. Well sir, one possible reason that heath care has risen so much for the DOD is that we have been at WAR since 2001! Unlike the paper cuts that you receive doing your job and use a band aid for, some veterans lose arms, legs and these I’m sure cost a little more to care for than your paper cut!!! Why is it that people like you insist on comparing the benefits of the military men and women who risk their lives on a daily basis and leave the services with disability like I have . You seem to be able to point out some of the benefits that I receive but none that you receive. As a union member what does your health plan cover?? What are your costs? Here is one thing I found on the web from your own recruitment power point: “Because of effective AFGE lobbying, all Census employees maintaining 5 continuous years on a Census health care plan shall upon retirement be eligible for full health benefits for the rest of their lives.” I know that the Census employee’s to a great job but does it really compare to that of a veteran who has given an arm or leg? 5 years of service for a lifetime of benefits?? I know veterans who served 5 years and do not get any health benefits from the VA. Abraham Lincoln vowed during his second inaugural address: “let us strive on to finish the work we are in, to bind up the nation’s wounds, to care for him who shall have borne the battle, and for his widow and his orphan.”, March 4, 1865. Before you take on the benefits of veterans I suggest you give some up yourself!! Or better yet, join the military and get some of these so called great benefits you talk about! It’ll only cost you 20 years of your life or maybe just an arm or leg.

    The pay raise you are talking about in the article is for active duty members. Retired military members have not seen a raise in the past two years.

    Thanks,
    Rodger
    ATC (AW) USN Ret.

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