Fact vs. Fiction on Military Personnel Costs (Part 3). The next several legislative updates will preview, in installments, a November Military Officer magazine article examining Pentagon assertions that your pay and benefits will break the bank. This week’s excerpt looks at DoD health care costs.
Warriors, Caregivers Offer Riveting Stories. At Thursday’s MOAA/NDIA Warrior Family Symposium, a packed house heard wounded warriors’, caregivers’, and providers’ heartfelt recounting of extraordinary successes, difficulties and determination – and responded with multiple standing ovations.
What Do You Know? How much do you know about military retirement? Take our short quiz below!
Fact vs. Fiction on Military Personnel Costs (Part 3)
The next several weeks’ legislative updates will preview, in installments, a November Military Officer magazine article in which MOAA’s Government Relations staff examines Defense leaders’ assertions that your pay and benefits will break the Pentagon bank. This week we take a look at DoD health care costs.
“Health Care Costs Are Eating Us Alive”
For the past year, this has been Pentagon officials’ constant mantra.
It’s how they’ve justified pushing health care fee hikes of $1,000 to $2,000 a year, including proposals to means-test fees by income, add new fees for TRICARE For Life and TRICARE Standard, and double and triple pharmacy copayments.
Defense officials persuaded the service chiefs and senior enlisted advisors to sign a letter to Congress endorsing these changes.
But let’s keep the facts in context.
To start with, health care represents about 16 percent of U.S. gross domestic product (GDP).
According to DoD, health costs “represent about 10 percent of the non-war defense budget.”
Compared to the national rate, that seems pretty reasonable for a personnel-heavy business that’s inherently dangerous.
Claims that health costs are rising out of control are belied by the Pentagon’s own July 2012 reprogramming request to Congress, which acknowledged costs will be $708 million less than budgeted for FY2012.
“These funds are excess to Defense Health Program requirements,” the document said, “and can be used for higher priority items with no impact to the program.”
And why exactly is that?
“The FY2012 budget estimate assumed private sector care cost growth of 12.9% for active duty and 8.5% for all other beneficiaries,” the document continued. “Through the first six months of FY2012 [costs actually] are growing at historically low rates of 0.6% for active duty and -2.7% for all other beneficiaries.”
So all the time Defense leaders were complaining of exploding health costs, the costs actually were…going down.
In response to this revelation, House Armed Services Committee leaders fired a scathing, bipartisan letter to Defense Secretary Leon Panetta.
“As you are aware,” the letter said, “The House of Representatives…declined to grant DoD the authority to raise TRICARE fees. We subsequently heard from DoD that our refusal…was endangering the sustainability of TRICARE programs. We have heard that ‘TRICARE is crippling’ the DoD. This does not appear to be the case if DoD has a $708 million surplus in FY2012…We do not understand how DoD can justify a request to raise fees on a class of people whose costs to the department are actually decreasing.”
And it’s not as if this was a one-time thing. According to the Government Accountability Office, the Defense Department underspent its TRICARE budget for civilian care by $771 million in fiscal year 2010 and by more than $1.3 billion in fiscal year 2011.
These budget snafus further buttress MOAA’s assertion that Defense leaders should focus on fulfilling their own responsibilities for efficient program oversight rather than seeking to foist blame and big fee hikes on beneficiaries.
In that regard, more than a dozen studies have urged reforming the current counterproductive bureaucracy under which three “stovepiped” service health care programs and multiple contractors squabble for shares of the health-budget pie.
To illustrate the problem, care delivered through military hospitals and clinics is 25 percent cheaper than purchasing care in the private sector, but military facilities are 27 percent under-utilized. Why? Because nobody’s in charge of ensuring care is delivered in the most cost-efficient way. The services that fund and staff military facilities focus on their separate budgets. There’s no disincentive for shifting beneficiaries to civilian care that gets billed to the Defense Department.
But Defense leaders continue to resist study recommendations to consolidate budget and delivery responsibilities under a unified medical command, while implementing only relatively cosmetic changes.
So how credible are DoD claims that beneficiaries must be penalized financially for “defense-eating” healthcare costs?
Not very, when:
- Defense leaders refuse to meet their own obligations for efficient oversight,
- the Pentagon TRICARE budget has been underspent by $2.8 billion over the last two years, and
- those same Defense leaders now admit costs are “growing at historically low rates” (quite a euphemism for a 2.7 percent decline among the population targeted for big fee hikes).
Check back next week for the 4th installment, and read part 1 and part 2 on MOAA’s website.
Warriors, Caregivers Offer Riveting Stories
The September 13 Warrior Family Symposium sponsored by MOAA and the National Defense Industrial Association featured impressive speakers, but it was the panel discussion participants who stole the show. Their stories are briefly summarized below, but you need to see the panel videos at http://www.moaa.org/wfs/#video.
Opening speaker Jeff Miller (R-FL), Chairman of the House Armed Services Committee, expressed frustration that DoD and VA are still “years away from achieving seamless transition” and falling short of mental health needs. “[The latter] isn’t an impending crisis,” Miller said. “It’s a crisis right now.”
VA Secretary Eric Shinseki also expressed impatience with those who see veteran homelessness, suicide, substance abuse and joblessness as an intransigent fact of life. “The VA’s stance is to fix those things,” he said. “We’re working to find vets and take care and services to them [through outreach and mobile services].”
Army Surgeon General LTG Patricia Horoho focused on “the responsibility of winning” the healthcare battle, emphasizing that everyone has a common interest and a role in increasing the health of both servicemembers and family members.
On the discussion panels, HM2 Derek McGinnis (USN-ret) suffered a lost leg, TBI and shrapnel wounds that initially left him unable to speak or walk. He was motivated by the birth of his son to “learn the new me…let go of the anger and be grateful” -- ultimately using the GI bill to earn a master’s degree. He emphasized the importance of the people who had enough faith in him to provide volunteering and employment opportunities, and how essential it is to “plant seeds of hope” in the minds of recovering warriors. His insightful term was “post-traumatic growth.”
Captain Alvin Shell (USA-Ret) was severely burned in an RPG attack. After “competing with my 9-month-old son in learning to walk,” he completed a triathlon last weekend. The extraordinary support of his wife and caregiver Danielle and his extended family were crucial to his recovery, and he worries many don’t have that support. His year-long search for employment was “worse than the injury.” He urged employers to “hold fast to that initial commitment to veteran hiring when big numbers of vets come back…it won’t be easy, but if you invest in us and trust us, it will get better.” Danielle emphasized family members must “avoid focusing on what you’ve lost…appreciate each other, because it was so close to being all gone…I told our children, ‘Daddy’s hurt, but he’s not broken.’”
Lt Col Tim Maxwell (USMC-Ret) had six deployments before suffering severe skull and other injuries in a rocket attack. His wife Shannon said they had “planned for the worst case (death), but not for injuries.” The Maxwells “found a mission” in starting the “SemperMax Support Fund” to help wounded warriors meet and discuss the issues others can’t understand. “We have troops with all kinds of shrapnel in their heads,” Maxwell said. “Sharing experiences is better than any drug.”
MSgt William “Spanky” Gibson (USMC-Ret) was determined from day one to overcome the loss of his leg. Told he couldn’t move into Fisher House because of the stairs, he spent hours traversing the stairwell to prove they wouldn’t stop him.
“Normality is all you want,” said Gibson, who ultimately stayed on active duty, competed in triathlons, and was the first above-knee amputee to be deployed again to a combat zone.
Major Tara Dixon (USAR) is a trauma surgeon who spent two tours in front-line operating rooms in Iraq. Operating on wounded friends created stresses of “hyper-vigilance…obsessing over procedures to avoid mistakes that could cost a life…to the point I couldn’t eat or sleep.” That PTSD obsession carried over to her civilian surgery practice when she returned. As a reservist, she found little military support. Military OneSource gave her appointments with providers who said they couldn’t deal with war-related PTSD. After she attempted suicide, the VA informed her that there was a two-year inpatient waiting list for female veterans, vs. six weeks for males. She recovered only after an extended stay in a capable facility her family found.
TSgt Matthew Slaydon (USAF-Ret) lost an arm and his eyesight to an IED on his third combat tour. Despite a good DoD/VA transition, medical retirement “solidified” him in his injuries, with anger and paranoia that led to estrangement from his mother and siblings. His service dog proved a life-saver, but the VA now denies service dogs for PTSD cases. His wife Annette turned the focus of her life to providing his care and was shocked when he said he still loved her, but wanted to be on his own. She continues as his caregiver, but they live apart, as she says many wounded couples do. “There’s no caregiver manual to tell you when he needs to feel more independent…I tried to be a superwoman, but didn’t realize I needed counseling myself and was stifling him…and nobody talks about sexuality issues for couples like us.” A recovery care coordinator for the Air Force, Annette said budget cuts already are draining critical resources for the wounded. “We’ve lost 9 positions, and the rest of us have taken drastic pay cuts.”
CE3 Benjamin Host (USN-Ret) suffered a fractured skull and brain injury in Iraq in 2004. After two years on the temporary disability retired list, the Navy offered him a 10% disability separation. With help from MOAA and the DAV, he ultimately won a military disability retirement and health coverage. “[MOAA’s] Rene’ Campos has been a blessing to me,” Host said.
Colonel Karen Malenbranche (USA-Ret), Executive Director of VHA Interagency Health Affairs, pledged to “go back and look at the service dogs issue” raised by TSgt Slaydon. She also said the VA has pressed hard on outreach efforts to the Reserve community to ease problems like Major Dixon experienced.
John Campbell, Deputy Assistant Secretary of Defense for Warrior Care Policy, said his purpose is to give the ill and injured an “equal opportunity to succeed.” While bureaucracies are frustrating, he emphasized that thousands of good people in them are trying hard to make a difference. “Caregivers are on my priority list this year,” he said.
At the afternoon Wounded Heroes Recognition reception, Senator Elizabeth Dole described how her experience as her husband Senator Bob Dole’s caregiver prompted her to create Caring for Military Families: The Elizabeth Dole Foundation.
Master of Ceremonies Lt Col Justin Constantine, USMCR, had his own incredible story, having been shot in the head by a sniper in Iraq in 2006. Since recovery from his terrible wound, he’s worked for the Department of Justice, the Senate Veterans Affairs Committee, the FBI, and now runs his own inspirational speaking company. Organizations assisting him included Give an Hour, Syracuse University’s Entrepreneurship Bootcamp for Veterans with Disabilities, the U.S. Chamber of Commerce, and many more.
Cpl Kevin Kammerdiener (USA-Ret) was critically wounded in Iraq, suffering devastating brain injuries and extensive burns that left little hope he would ever have communication or mobility. Today, thanks to the full-time love and support of his mother, Leslie, he is able to walk and talk. The Wounded Warrior Project’s Independence Program was recognized as critical to his ability to live a more productive and higher-quality life.
Corporal Jon Albrecht (USA-Ret) suffered multiple concussion-related injuries in Iraq in 2009. After months of rehabilitation, he and his wife and son live in a transitional apartment provided by Operation Homefront while planning their next move to a new home in Maryland.
Lieutenant Brian Naughton (USCG) was wounded in a grenade explosion while serving in Iraq with Seal Team 10. Following evacuation and rehabilitation, he returned to Iraq to complete his deployment tour. He credited support from Navy Safe Harbor, SOCCOM Care Coalition, and the Wounded Warrior Project.
MSG Juanita Milligan (USA-Ret) sustained multiple severe injuries in Iraq as the result of an IED explosion. In retirement, she deals not only with her own injuries but is a caregiver for her special-needs son and her elderly parents. She cites the Business and Professional Women Foundation’s Joining Forces for Women Veterans Mentorship Program, ICF International and the USO for her support.
SSG Dale Beatty (ARNG-Ret) lost both legs to an IED explosion in Iraq. After an extended recovery, he oversaw the construction of a new home and co-founded Purple Heart Homes, a non-profit organization that provides personalized housing solutions for service-connected disabled veterans and their families. He cites the Iredell Home Builders Association and the Fisher House Foundation as crucial to his return to productive family and work life.
What Do You Know?
How much do you know about military retirement? Take our short quiz below! Answers are from the FY2011 end-of-year report prepared by the DoD Actuary.
1. What is the life expectancy for a 65-year-old retired military officer?
A. 10.5 years
B. 17.1 years
C. 22.7 years
Answer: B. According to the DoD actuary, a 65-year-old military retiree is expected to live an additional 17.1 years.
2. What is the lump-sum equivalent of a military retirement for an O-5 retiring today with 20 years of service?
A. $1.15 million
B. $958,000
C. $756,000
Answer: A. According to the DoD Actuary, this is the lump-sum amount that would have to be invested in today’s treasury bonds to be able to fund the O-5’s same monthly retired pay checks, with 3% annual COLAs, for the rest of the his or her expected lifetime.