SBP Kickoff

New bill would end Survivor Benefit Plan (SBP) annuity reduction for service-caused deaths and ease premium penalties for “greatest generation” retirees.

Sen. Bill Nelson (D-Fla.) and Sen. Jon Corzine (D-N.J.) introduced a new joint bill in late January to address two remaining major SBP inequities. S. 185, the Military Retiree Survivor Equity Act, would end the deduction of VA survivor benefits (paid when the servicemember’s death is caused by a service-connected condition) from the survivor’s SBP annuity. It also would move up the 2008 effective date of 30-year paid-up SBP coverage, which puts undue financial penalties on greatest generation SBP enrollees, to 2005.

Sens. Chuck Hagel (R-Neb.), Richard Durbin (D-Ill.), and Mark Dayton (D-Minn.) joined Nelson and Corzine as original cosponsors in this bipartisan effort.

“At a time when we’re asking for great sacrifices from the volunteer servicemembers who protect and defend this nation, it’s more important than ever to uphold the commitments we’ve made
to them,” Nelson said.

Survivors of servicemembers who die of service-connected causes are entitled to Dependency and Indemnity Compensation (DIC)—$993 a month for a survivor without children—from the VA. The surviving spouse’s SBP annuity is reduced by the DIC amount. A prorated share of SBP premiums is refunded to the widow upon the member’s death, but with no interest. MOAA thinks that, if military service caused a retired servicemember’s death, the VA indemnity compensation should be added to the SBP benefit the retiree paid for, not substituted for it. No survivors of civilian retirees who also are disabled military veterans and die of a military-service-connected cause must forfeit their purchased survivor benefits to receive DIC.

For servicemembers killed on active duty since Nov. 24, 2003, a surviving spouse with children can avoid the dollar-for-dollar offset by assigning SBP to the children. But that forces the spouse to give up any SBP claim after the children attain their majority—leaving the spouse with only $993 a month from the VA. About 53,000 survivors are affected by the DIC offset.

The FY 1999 Defense Authorization Act authorized retired SBP enrollees who have reached age 70 and paid SBP premiums for at least 30 years to stop paying premiums, while keeping SBP coverage. But Congress delayed the effective date to Oct. 1, 2008, to save money.

Servicemembers who retired after 1978 only have to pay 30 years, but tens of thousands of greatest generation retirees who signed up for SBP as early as 1972 will have to pay premiums for up to 36 years. They paid higher SBP premiums for almost two decades before premiums were reduced in 1990. By October 2005, a 1972 retiree already will have paid almost 20 percent more premiums than a 1978 retiree will ever pay.

You can help correct these inequities by signing, stamping, and mailing the cards on this magazine’s cover to your legislators (cards with blank return addresses are for a spouse or friend to sign).

Bilirakis Back

Concurrent receipt hero’s bill recognizes progress to date and remaining needs.

House concurrent receipt champion Rep. Michael Bilirakis (R-Fla.) has reintroduced his concurrent receipt legislation for the new 109th Congress—a bill with a familiar number, H.R. 303.

H.R. 303 would provide full concurrent receipt of retired pay and veterans’ disability compensation, effective Jan. 1, 2006, to all disabled retirees who were eligible for retirement based on service, independent of any disability.

The bill begins with a “sense of Congress” that much progress has been made on concurrent receipt in recent years, but that Congress is not content with the status quo and thinks the disability offset must be eliminated.
 
The first modest, but important, change in 1999 authorized special compensation for certain severely disabled retirees. Later updates ended the disability offset for all combat and combat-related training disabilities and will phase out the disability offset for retirees with other service-connected disabilities rated 50 percent or higher.

Last year’s defense act removed 100-percent disabled retirees from the phase-out schedule and authorized them immediate concurrent receipt effective Jan. 1, 2005 (seen in Feb. 1 paychecks).

As this article went to press, MOAA was still awaiting the administration’s decision whether servicemembers paid at the 100-percent rate because of unemployability also will receive full immediate payment or whether additional legislation will be needed to do so.

Also at press time, Sen. Harry Reid (D-Nev.) was preparing to reintroduce his concurrent receipt bill in the Senate. Bilirakis and Reid are considering additional legislative possibilities to increase the odds of success this year.

Visit MOAA’s Web site (http://capwiz.com/moaa/issues/bills/?bills) to send a MOAA-suggested message urging your representative to cosponsor H.R. 303.

MOAA Rebuts Budget Baloney

Attacks on retiree, survivor, and reserve benefits off base.

If it’s January, it’s kickoff time for the annual budget wars. This year, unfortunately, it brought a misleading and ill-advised attack on the Guard and Reserve, retiree, and survivor benefit upgrades from some segments of the administration and the media.

A Jan. 11 New York Times op-ed piece raised eyebrows among the MOAA staff and servicemembers across the country by carping about the cost of TRICARE For Life (TFL), concurrent receipt, SBP, and other recent legislation. Author Cindy Williams, a researcher at the Massachusetts Institute of Technology, said the cost of these and other benefits is a weight on the DoD budget and doesn’t do anything to help current retention.

Those themes were echoed in a Jan. 25 Wall Street Journal front-page story headlined “As Benefits for Veterans Climb, Military Spending Feels Freeze.” The story quoted a senior Pentagon official as asserting military retirees are taking budget money that military leaders want to use for troops and equipment today. It also cited MOAA as “the main force” behind the recent benefit improvements. The writer conducted an extensive interview with MOAA President Vice Adm. Norbert R. Ryan Jr., USN-Ret., but relatively little of the MOAA rebuttal survived the Journal’s editing process. (See the “President’s Page” on page 12 of this issue for more thoughts from Ryan.)

A key (but unprinted) point Ryan raised is that Congress also passed legislation requiring that funding for TFL and concurrent receipt is to come from the Treasury Department, not the defense budget, specifically to ensure these programs don’t take money from other defense programs.

If the administration is somehow requiring such trade-offs in the defense budget, it’s not retirees’ fault—and it’s contrary to the express will of Congress, as signed into law by the president.

Pentagon leaders who assert that improving retiree and survivor benefits does not affect active duty retention forget that the Joint Chiefs of Staff in the late 1990s urged Congress to repeal previous retirement cuts that were found to be undermining retention and readiness. The Joint Chiefs also told Congress at the time that they supported retiree health care fixes, because active duty troops know that they’ll be retired someday, too.

They knew what some forget today—that the troops are smart and will see through a “give them cash for a truck today and they won’t care about their future benefits” philosophy. That’s exactly what gave rise to the retention and readiness crises of the late 1970s and late 1990s, when thousands of mid-career military families decided that the long-term benefits of a military career weren’t adequate to offset the current sacrifices. And that’s also why Congress reversed previous caps on military pay raises, repealed retirement cuts, upgraded retiree health care, and corrected long-standing penalties imposed on disabled retirees and survivors.

It’s also why, considering the tremendously increased sacrifices the country is imposing on Guard and Reserve members and families (see “Unreserved Warning,” page 38), they need to act on Guard and Reserve compensation and benefit package upgrades that DoD has been resisting.

Fortunately, the legislative branch has a far better record of protecting the troops’ long-term interests than the executive branch has. Congress has demonstrated time and again that it will provide funding to meet the needs of all members of the military community, including active duty and Guard and Reserve members and families, military retirees, and survivors.

MOAA has supported a strong national defense as its top priority for more than 75 years. These articles point out yet again why MOAA has a responsibility to help ensure that retention lessons learned under previous administrations aren’t lost as Pentagon leadership changes, independent of any particular administration’s budget-driven proposals.

MOAA has been working extensively with national and local print and electronic media to articulate this point of view. Visit MOAA’s Web Base (www.moaa.org) to view the two articles mentioned above and MOAA’s response.

More New Bills

Legislators set out markers for coming year.

Since all bills expire when Congress adjourns, the start of a new Congress always brings a flood of newly introduced legislation. Here is a summary of selected bills introduced when Congress returned to work in January:

• S. 11 (Sen. Carl Levin, D-Mich.) is an omnibus bill that would increase Army and Marine Corps strengths, provide tax credits to employers of mobilized Guard and Reserve members, increase the military death gratuity to $100,000, eliminate the Dependency and Indemnity Compensation offset to the Survivor Benefit Plan (SBP), accelerate the 2008 effective date of SBP, and provide additional health coverage options to all Selected Reserve members, among other provisions.
   
• S. 13 (Sen. Daniel K. Akaka, D-Hawaii), another omnibus bill, would authorize a new VA health care funding process aimed at ensuring full funding for all enrolled veterans, eliminate the disability offset to retired pay for all retirees with 20 or more years of service, improve VA mental health services, authorize filling of civilian prescriptions in VA facilities, authorize a GI Bill enrollment option for members who entered service between 1977 and 1985, and improve education benefits for survivors.
   
• S. 77 (Sen. Jeff Sessions, R-Ala.) would increase maximum Servicemembers’ Group Life Insurance (SGLI) from $250,000 to $400,000 (of which the first $150,000 would be premium-free for servicemembers serving in combat zones) and increase the military death gratuity to $100,000 for servicemembers killed in combat.
   
• S. 42 (Sen. George Allen, R-Va.) and S. 44 (Sen. Chuck Hagel, R-Neb.) would increase the death gratuity to $100,000 for servicemembers killed on active duty since Sept. 11.
   
• S. 43 (Hagel) would end the $1,200 enrollment fee for the Montgomery GI Bill (MGIB), refund the fee to MGIB-participating members on active duty, and offer a new enrollment opportunity to all non-participating active duty servicemembers.
   
• S. 121 (Sen. Mike DeWine, R-Ohio) would increase the death gratuity to $100,000 for the surviving spouse plus $25,000 for each surviving child, authorize free TRICARE Prime eligibility for surviving children, double the education benefit for surviving children, and increase DIC to $1,500 a month for an eligible surviving spouse plus $750 a month for each surviving child.
   
• H.R. 333 (Rep. Stephen F. Lynch, D-Mass.) would protect education status and financial interests of those called to active duty while enrolled in college courses.
   
• H.R. 377 (Rep. Terry Everett, R-Ala.) is the House companion bill to Sessions’ S. 77.
   
• H.R. 147 (Rep. Howard McKeon, R-Calif.) would repeal the Government Pension Offset (GPO) and Windfall Elimination Provisions (WEP). Both GPO and WEP provisions result in unfair reductions in earned Social Security benefits of retired government employees, many of whom also are military retirees.
   
• H.R. 197 (Rep. David Scott, D-Ga.) would limit states to charging in-state tuition rates for active duty members and their dependents assigned to duty stations in the state.
   
• H.R. 269 (Rep. Dave Camp, R-Mich.) would authorize a one-time opportunity to enroll in the MGIB for active duty servicemembers who entered service between Jan. 1, 1977, and June 30, 1985, but declined to enroll in the “Post-Vietnam Era Veterans Education Assistance Program” (VEAP). These VEAP “decliners” were advised by military counselors to turn down the marginal VEAP benefit and wait for the “new GI Bill”—which ultimately was enacted in 1984 but denied eligibility for this group.
  
  This bill replaces H.R. 879 from the 108th Congress.
   
• H.R. 502 (Rep. Chris Smith, R-N.J.) would increase the death gratuity to $100,000 and maximum SGLI coverage to $400,000 for all members who die on active duty, retroactive to Oct. 1, 2000 (the date of the attack on the USS Cole).

You can use MOAA’s Web site (http://capwiz.com/moaa/issues/bills) to check status updates on key bills and urge your legislators’ support.

Part B Window Closing

Medicare-eligibles must  enroll to be eligible for TRICARE For Life.

The 2003 Medicare Modernization Act authorized a special enrollment period for retired military beneficiaries who never had signed up for Medicare Part B. It also authorized a prospective waiver of late enrollment penalties for military beneficiaries who signed up for Part B in 2001 or later.

The purpose was to ease penalties for previously unenrolled retirees who had to sign up for Part B to get TRICARE For Life (TFL) benefits. Those who don’t sign up for Part B when first eligible normally pay an extra 10-percent premium penalty for every year they delay signing up.

This past fall, DoD sent a letter to the 68,000 TFL-eligibles not enrolled in Part B, telling them that they would need to take Part B to keep TRICARE benefits and that Medicare would be sending them a follow-up letter telling them how to enroll. However, about 30,000 of those individuals never received any letter from Medicare—and thus have not been enrolled in Part B.

Some might not wish to take Part B—because they still are covered by employer-sponsored insurance, because they get care from the VA health system, or because they are active duty family members. However, TRICARE will not pay claims for Medicare-eligibles who were not enrolled in Part B by Jan. 1, 2005. Eligible beneficiaries not yet enrolled in Part B can regain TRICARE eligibility (without a late enrollment penalty) if they enroll anytime in 2005. If retirees (other than those still working and covered by an employer-sponsored plan) wait until 2006 or later to enroll, they’ll be subject to the late enrollment penalty.

They can enroll by contacting their local Social Security office, by calling Social Security at (800) 772-1213, or by using the Social Security Web site at www.ssa.gov/legislation.

Beneficiaries whose TRICARE claims are denied because they’re not enrolled in Part B have two options:

• Wait until their enrollment has been processed in DoD records and then ask the provider to resubmit the claim to Medicare; or
   
• Take their Medicare card to their local military personnel ID office for assistance, or contact the Defense Manpower Data Center Support Office at (800) 538-9552.

For additional information, visit the TRICARE Web site at www.tricare.osd.mil or contact TRICARE’s Medicare-eligible claim processor at (866) 773-0404.

It’s Draining Vets

Fewer incoming legislators have military experience.

With each new Congress, we’ve noted a steady decline in the number of senators and representatives who have experienced some form of uniformed service. The figures below include any form of active duty, Reserve, or National Guard service. This year’s difference is highlighted by comparing those who left Congress by retirement or defeat versus the freshmen legislators who replaced them (bottom right). At left is the breakdown of the service affiliations among the veterans in the 109th Congress (in some cases, a servicemember served in more than one uniformed service). At bottom left are the numbers of combat veterans and uniformed service retirees (with at least 20 years of regular and/or Guard and Reserve service). Finally, it’s interesting to note the veteran presence on key committees that exert substantial influence over the success of MOAA’s legislative initiatives (bottom center). The declining number of veterans in Congress reflects national population trends, and the proportion that has served will continue to decline over time. But we shouldn’t jump to the conclusion that veteran status is any litmus test of a legislator’s likely support for military and veterans issues. Many non-veterans are among our strongest supporters on Capitol Hill, and some who have advocated severe benefit cutbacks in the past served in the armed forces with great distinction. More than anything else, the figures illustrate the education challenge we face in getting our legislators to understand our issues. Most want to do the right thing, but their unfamiliarity with our issues means constituents who are veterans need to help educate them.

Unreserved Warning

Reserve chief memo expresses worry about “broken force.”

Lt. Gen. James Helmly, USA, commander of 200,000 Army Reserve troops, has warned that the Army Reserve (USAR) is “rapidly degenerating into a ‘broken’ force.” His Dec. 20 memo to Army Chief of Staff Gen. Peter Schoomaker states that current demands on the USAR and “dysfunctional” mobilization and personnel management policies have degraded mission readiness.

“The purpose of this memorandum is to inform you of the Army Reserve’s inability — under current policies, procedures, and practices … to meet mission requirements associated with Operation[s] Iraqi Freedom and Enduring Freedom and to reset and regenerate its forces for follow-on and future missions,” he said. Helmly’s concerns include:

• Mobilization policy and procedures. Helmly thinks the Army is too reliant on individual volunteers rather than unit call-ups.
   
• Deployment policies. Tour lengths vary widely depending on the deployment location; “last minute extensions” are causing harm to soldiers, families, and employers.
   
• Nonparticipating soldiers. Reserve soldiers who have not met their military training obligations should be called up or discharged.
   
• Reconstitution policies. Reserve equipment often is left behind in the combat theater for the next rotation, leaving units with nothing to train on in home station. Post-mobilization policies bar performing two weeks annual training within six months after returning.
   
• Force depletion. Only about 37,000 out of 200,000 USAR soldiers currently are available for mobilization and deployment, because the others already were mobilized, not yet fully trained, etcetera.

These are not simple issues, they did not develop overnight, and there will be no easy solutions. MOAA remains convinced the main problem is that the country has imposed overwhelming mission increases on too-small forces that—regardless of the troops’ boundless patriotism and can-do attitudes—will be difficult to sustain much longer without serious retention and readiness consequences.

The country needs significantly larger armed forces, so we don’t have to keep placing such extreme demands on our active duty, Guard, and Reserve troops—and putting military leaders like Helmly in
such untenable positions.

Raising the Standard

DoD brochures, provider surveys aim to improve TRICARE Standard.

DoD is continuing its efforts to improve TRICARE Standard (the TRICARE program used by under-65 beneficiaries not enrolled in the managed-care TRICARE Prime). This push began last year, after Congress tasked the department with providing a TRICARE Standard information outreach program to assist beneficiaries in obtaining their benefits and to encourage providers to accept Standard patients.
The Pentagon took the first steps to educate beneficiaries last year by sending a TRICARE beneficiary handbook to every beneficiary household, marking TRICARE’s first coordinated outreach to all beneficiaries. A beneficiary education brochure targeted to Standard beneficiaries is available online at www.tricare.osd.mil/tricaresmart/product.aspx?id=121&CID=70&RID=3.

DoD also is developing a plan to ensure patients receive the help they need finding a TRICARE-participating doctor. To this end, a provider directory for Standard users is now available on the TRICARE Web site at www.tricare.osd.mil/standardprovider.

Each TRICARE region’s Managed Care Support Contractor is required to provide assistance 24 hours a day, seven days a week to locate network providers in their regions for all TRICARE beneficiaries (including Standard). Those who need assistance finding a TRICARE-participating doctor can call:

• North Region: (877) 874-2273
• South Region: (800) 444-5445
• West Region: (888) 874-9378

Perhaps most important, the FY 2004 Defense Authorization Act mandated that DoD conduct nationwide surveys to determine the numbers and proportions of providers, by region, who are accepting new TRICARE Standard patients. These surveys of civilian physicians also were intended to gain insight into the reasons why doctors choose to accept (or not accept) Standard. The surveys began in 2004 and will continue to be conducted in at least 20 TRICARE market areas each year until all have been surveyed.

The results of the first 21 market area surveys are listed in the chart at left. Defense health officials consulted with MOAA and The Military Coalition to identify initial market areas based on MOAA surveys and other member reports of insufficient provider availability. Providers in survey areas were selected at random from the rolls of state medical associations and from the American Medical Association’s comprehensive listing of all licensed physicians.

We’re pleased with these initial steps to increase emphasis on the Standard benefit. However, we’re concerned that White House budget officials refused defense health leaders’ original request for a 12-question survey, limiting the survey to only three questions as to whether doctors were accepting any new patients; whether they were accepting any new TRICARE Standard patients; and, if not, why not.

The next challenge is to establish desired standards for provider participation rates. The limited survey provides information not available previously but still leaves many questions open about possible providers’ misperceptions about TRICARE coverage, claims processing timeliness, and administrative issues. MOAA will work with DoD to implement Standard improvements and outreach efforts to educate beneficiaries and attract more providers.