Up-Hill Battles

The FY 2006 Defense Authorization Bill passes the House, setting up several issues of contention with the expected Senate bill, including SBP and concurrent receipt.

The full House passed its version of the defense bill (H.R. 1815) May 25 by a 389-to-39 vote. The Senate bill had been approved by the armed services committee but was not scheduled to come up for consideration by the full Senate until sometime in June.

The two bills have many initiatives in common, including:

• a 3.1 percent pay raise for active duty and Guard and Reserve members;

• significant manpower increases for the Army;

• continuation of combat pay for wounded members while hospitalized;

• permanent improvements in military death benefits;

• additional funding for military family support programs;

• updated casualty assistance guidelines; and

• limitations on civilianization of military medical positions.

Working on Commission

Review group kicks off hearings on concurrent receipt, disability process.

The newly formed Veterans’ Disability Benefits Commission held its first public hearings May 9 and 10. MOAA’s Deputy Director for Government Relations Col. Bob Norton, USA-Ret., testified before the commission.

Congress authorized the commission in 2003 to study and report on the standards for determining disability and survivor benefits and the level of compensation for such benefits. Its establishment was part of the congressional agreement that authorized ending the disability offset to retired pay for combat-related disabilities and phasing it out for members with 50 percent or higher disability ratings. Legislators were reluctant to address the concurrent receipt issue for lower ratings without a more extensive review of the disability system itself.

The commission must report its findings and recommendations to the president and Congress by August 2006.

Commission Chairman Lt. Gen. James T. Scott, USA-Ret., asserted at the hearing that the commission is an independent body and has no pre-set agenda or conclusions regarding the disability system. He noted that there had not been a major review of the veterans’ disability system since Army Gen. Omar Bradley led one in 1956.

The commission took testimony from defense officials, congressional auditors, veterans’ service groups, and military associations. Sen. Daniel Akaka (D-Hawaii), ranking member of the Senate Veterans Affairs Committee, also addressed the commission. He said Congress’ intent in establishing disability compensation is to (a) compensate disabled veterans for diminished earnings capacity, (b) compensate for a reduced quality-of-life, and (c) send a recruiting and retention message assuring current and potential servicemembers that their government will provide for those disabled in service.

Dorcas Hardy, a member of the Social Security Advisory Board, advanced an alternative view that benefits should be based on a veteran’s ability to work or return to work, along the lines used by the Social Security Administration (SSA). SSA disability compensation is awarded only in the case of documented inability to work. VA witnesses told the panel that the number of veterans deemed unemployable has doubled in the past six years.

Norton urged the commission to uphold the principle that military service is a “24/7” commitment to the nation and that any disability incurred in the line of duty should be compensated. Norton recommended the panel endorse full concurrent receipt for all disabled retirees, including pro rata coverage for those forced by a service-connected disability to retire with less than 20 years of service.

The Discharge Is Honorable

Marshall pushes “disabled veterans tax” fix.

Rep. Jim Marshall (D-Ga.) has introduced a discharge petition to force a House vote on H.R. 303, Rep. Mike Bilirakis’ (R-Fla.) bill that would end the disability compensation offset to military retired pay for all servicemembers otherwise entitled to retired pay, independent of any disability.

Under current law (which was influenced by a similar discharge petition Marshall filed in 2003), servicemembers with at least 20 years of service and a 100 percent disability rating or a combat-related disability rating receive their full service-based retired pay.

Those with 50 percent to 90 percent ratings (and those rated “unemployable” by the VA) will have their retired pay restored on a phased-in basis over the next eight years. Those with 40 percent or lower disability ratings lose $1 of their earned retired pay for each $1 in VA
disability compensation.

As of May 26, 162 House members had signed the discharge petition, which is actually greater than the number of current H.R. 303 cosponsors.

At press time, H.R. 303 had 159 cosponsors — 40 Republicans, 118 Democrats, and one Independent. To date, all 162 signers of the discharge petition are Democrats. View the list of signers at http://clerk.house.gov/109/lrc/pd/petitions/dis2.htm.

Thank legislators who have signed the petition and urge remaining House members to do so by visiting MOAA’s Web site, http://capwiz.com/moaa/home, and clicking on the “Disabled Veterans Tax Discharge Petition” link.

Emergency Upgrades

Supplemental Appropriations Act includes death benefits, disability protection.

On May, President George W. Bush signed H.R. 1268, the Emergency Supplemental Wartime Appropriations Act, which will fund continuing military operations overseas as well as increases in military death and disability benefits in several areas. But the final bill dropped other initiatives sought by MOAA and other advocates for disabled retirees and Guard and Reserve servicemembers.

Here’s a summary of selected provisions of the bill of particular interest to MOAA members:

Servicemembers’ Group Life Insurance (SGLI) Coverage. Increase maximum coverage from $250,000 to $400,000 for all eligible servicemembers, effective Sept. 1, 2005. Survivors of members who died in a combat zone or of combat- or operations-related causes between Oct. 7, 2001 (the official start of the war on terrorism), and Sept. 1, 2005, will be eligible for retroactive payment of the extra $150,000.

Military death gratuity. Establish a special $100,000 death gratuity for the survivors of members who die in a combat zone or of combat- or operations-related causes. For other active duty deaths, the standard $12,450 death gratuity still will apply. Survivors of servicemembers who died of combat- or operations-related causes since Oct. 7, 2001, will be eligible for the $88,000 difference.

There remains some question whether the language of the bill might have inadvertently made the $88,000 retroactive payment subject to federal income tax. Hill leaders have indicated their intent to ensure the payment is not taxable.

Free SGLI coverage in combat zones. The secretary of defense may elect to provide the first $150,000 of SGLI coverage free for servicemembers assigned to a combat zone.
Traumatic injury protection. Authorizes a “traumatic injury” insurance rider to SGLI that would pay a servicemember $25,000 to $100,000 for certain severe injuries, ranging from significant burns or loss of a thumb and finger to total paralysis or coma.

Defense health program. Adds $35 million to military health care programs to meet the additional workload from the war on terrorism.

MOAA Staff Transitions

Health care lobbyists are changing seats.

Sadly for MOAA, Sue Schwartz, DBA, RN, deputy director of Government Relations since 2000, is leaving the staff in July, when her husband (an active duty Marine Corps officer) is reassigned to Cherry Point MCAS, N.C. As MOAA’s lobbyist for health care issues, Schwartz played a key role in winning TRICARE For Life (TFL), TRICARE Senior Pharmacy coverage, and increased Medicare and TRICARE reimbursements for providers. She has protected members’ interests as a member of the President’s Commission on DoD/VA Health Care and the Beneficiary Advisory Panel for DoD’s pharmacy program. She was a primary author of MOAA’s acclaimed TFL pamphlets for members and providers, as well as a new uniform formulary pamphlet you’ll be seeing this fall. Schwartz will put her considerable energy and skills into helping Marines and their families at Cherry Point, but MOAA will continue to benefit from her insights, as she has been hired by HealthNet to be that TRICARE contractor’s beneficiary liaison to The Military Coalition.

Col. Jim Young, USAF-Ret., will fill Schwartz’s position in August, upon completion of a 27-year military career as a distinguished pharmacist, hospital commander, and senior health care staff officer. Young’s most recent duty assignment has been as director, DoD Pharmacy Programs in the Office of the Secretary of Defense. Previously, he served as chief pharmacist for the Air Force and as chief of the Air Force Biomedical Science Corps. At the operational level, he commanded the Medical Group at Davis-Monthan AFB, Ariz., and later was selected to command the David Grant Medical Center at Travis AFB, Calif., where he also served as DoD’s lead agent for TRICARE Region 10. He brings a wealth of professional expertise, perspective, and leadership experience, and MOAA is pleased and fortunate to welcome him to the government relations team.