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  • The administration’s $4 trillion proposed budget calls continues to call for cuts to military people programs to “slow the growth” of military personnel costs. The request is strikingly similar to the administration’s budget proposal last year. Once again, it calls for a military pay cap, an increase in out-of-pocket housing costs, and higher TRICARE fees. 

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  • Compensation

     

    • • Cap the FY 2016 active duty pay raise at 1.3 percent (versus the 2.3 percent mandated by law). The proposal would amount to a third straight year of pay caps below private sector pay growth. The Pentagon is also requesting four additional years of caps (FYs 2017-2021). The troops’ last four raises averaged less than 1.4 percent , with the FY 2014 and FY 2015 pay raises being the lowest in 50 years. 
    • • Reduce the Basic Allowance for Housing (BAH) by up to 5%. This is a second year of cuts, reversing DoD’s own initiative to eliminate out-of-pocket housing costs.
    • • Cut $1 billion in the annual commissary subsidy. That equates to a 66 percent loss of savings for commissary shoppers.
    • • Increase health care costs and create new fees for active duty families who have limited or no access.
    • • Reduce overall military end strength by 11,300.

     

  • Health Care

     

    The president’s budget would:

    • • Consolidate TRICARE Prime, Standard, and Extra programs into one program. Beneficiaries would be left with all of the costs but none of the guaranteed access to care.
    • • Dramatically increase pharmacy copays to surpass the median costs of civilian plans.
    • • Re-label TRICARE Prime’s enrollment fee to a “participation” fee for working age retirees.
    • • For the first time ever, working age retirees would be forced to pay to use MTFs.
    • • Impose a means-tested enrollment fee for new TRICARE for Life beneficiaries, something to which no other federal retiree is subjected.
    • • Require all maintenance medications be filled by MTFs or mail order pharmacy.

    Overall, the consolidation does not improve the health care benefit – it merely shifts more cost onto beneficiaries. Retirees will pay more for care without improving access, quality, or wait times.

    Three years of pay caps, the full implementation of BAH and commissary cuts, and consolidating TRICARE would significantly erode the purchasing power for servicemembers and their families. An Army sergeant (E-5) with ten years of service and a family of four would lose over $5,000 a year in purchasing power. An Army captain (O-3) would lose more than $6,000.

    President's Budget Currently Serving Impact FY2016