Disabled on Do-List

Expect multiple concurrent receipt bills early in 2005, including protections for “unemployable” disabled retirees and combat-disabled retirees who were medically retired short of 20 years.

After years of legislative battling and finally winning substantial recent progress, some in Congress are tired of hearing about concurrent receipt inequities. They want credit for progress made, not complaints about what’s left undone.

MOAA and disabled retirees understand the frustration. We deeply appreciate Congress’ significant legislative and funding initiatives that have fixed the problem fully for some disabled retirees and charted a path to full retired-pay restoration for many others. But we can’t in good conscience ignore that thousands of disabled retirees—including many with 100-percent combat disabilities—remain left behind.
 
To date, almost every legislative effort to address the concurrent receipt problem, including combat-related special compensation (CRSC), has focused exclusively on disabled retirees with 20 or more years of creditable service.

The main reason is that, when confronted with a complicated problem that’s expensive to solve, Congress deals best with a simple solution that addresses the clearest inequity. People with 20 years of service clearly earned an entitlement to retired pay independent of any disability, so that group has the most understandable claim that they shouldn’t lose their earned retired pay. But as Congress has acted incrementally to address the most glaring disability problems, successive law changes have created additional disparities.

Congress first sought to limit consideration to people with 20 or more years on active duty who incurred severe injuries (50 percent disabling or more) in combat, or any disability rating associated with the award of a Purple Heart. When those arbitrary limitations raised complaints, Congress expanded coverage to include reserve retirees and all combat- or operations-related disability ratings. The law also was changed to restore retired pay (over a 10-year schedule) for retirees with 20 or more creditable years (active duty, Guard, or Reserve) and disability ratings of 50 percent or greater that were caused by noncombat, service-connected conditions.

In 2004, the law was amended again to provide full concurrent receipt, effective in January 2005, for 20-year retirees with noncombat-related conditions specifically rated as 100-percent disabling.

All of these changes were major advances over the status quo, and MOAA strongly supported them in the interest of making all possible progress toward our goal of full concurrent receipt.

But each incremental piece of progress creates a new benefit disparity. For example, the law now:

• Provides immediate full concurrent receipt to all 100 percent disabled retirees with 20 or more years of service, but seems to leave retirees with lesser disabilities that render them “unemployable” by VA standards having to wait 10 years to get back their full retired pay, even though the VA compensates “unemployables” at the 100-percent rate; (Note: As this article went to press, Pentagon lawyers were reviewing whether the law’s wording might allow paying unemployables.)
   
• restores retired pay over 10 years for a 50 percent to 90 percent (noncombat) disabled retiree but provides no relief at all for 40 percent or lower-rated disabilities; and
   
• fully eliminates the retired pay offset for any combat-related disability rated 10 percent or higher for retirees with 20 or more years of service but provides no relief at all for a 100 percent disabled member forced into a medical retirement with 19 years and 10 months of service because an enemy sniper’s bullet left him a quadriplegic.

The existence of these new differences testifies to how much progress we’ve made since a few years ago, when no disabled retiree got any relief at all. On the plus side, legislation already has been proposed to fix all of these problems—with the notable exception of the last-mentioned one.

Now, MOAA thinks it’s time to seek additional legislation authorizing CRSC for those who fell short of serving 20 years only because combat injuries forced premature medical retirement. In such cases, MOAA supports restoring the proportional retired pay they earned by service, independent of disability —2.5 percent of pay per year of service.

We’re optimistic about making continued progress for disabled retirees in 2005. You can help kick off the campaign in the 109th Congress by signing and mailing the tear-out letters that appear after this page and after page 58.

More to Do on SBP

Hill sponsors to combine Paid-Up SBP, DIC offset fixes in single bill.

Last year’s legislative efforts resulted in a major victory when Congress ended the Survivor Benefit Plan (SBP) “widows tax” on survivors age 62 and older. This year’s SBP goal is to correct two remaining military SBP inequities.

* SBP-DIC Offset: Under current law, the surviving spouse of an active duty or retired military member who dies from a service-connected cause is entitled to Dependency and Indemnity Compensation (DIC) ($993 a month for a survivor without children) from the VA. If the surviving spouse is eligible for SBP, that annuity is reduced by the DIC amount.

MOAA thinks that if military service caused a retired member’s death, the VA indemnity compensation should be added to the SBP the retiree paid for, not substituted for it. For members killed on active duty,
a surviving spouse can avoid the dollar-for-dollar offset only by assigning SBP to children. But that forfeits any SBP claim after the children attain majority — leaving the spouse with less than $1,000 monthly from the VA. Those who give their lives for their country deserve fairer spouse compensation. Federal civilian retirees who also are disabled military veterans and die of a military-service-connected cause do not forfeit any of their purchased survivor benefits if their survivor is eligible for DIC.

* 30-Year, Paid-up SBP: The FY 1999 Defense Authorization Act lets retired SBP enrollees who have attained age 70 and paid SBP premiums for 30 years stop paying premiums, while retaining coverage for their survivors, but delayed the effective date until Oct. 1, 2008. All SBP enrollees who retired after 1978 have 30-year, paid-up SBP protection, but this effective date forces thousands of “greatest generation” retirees who signed up for SBP as early as 1972—and paid two decades of higher premiums before the 1992 premium reduction—to pay premiums for up to 36 years.

Bills to fix these problems have gained only modest support so far. One reason is that both issues have limited constituencies compared to the age-62 widows tax, concurrent receipt, and other initiatives that have enjoyed more success. There are an estimated 53,000 SBP-DIC widows and about 135,000 retirees who would benefit from the paid-up SBP acceleration.

MOAA and The Military Coalition (TMC) think a new approach is needed to broaden support for these issues, maximize the chance of immediate action, and avoid having to ask either group to take a back seat—again—while we work someone else’s SBP problem. To that end, MOAA and TMC have proposed combining the two in a single bill. Together, we think these two groups can generate greater grassroots support, public empathy, and congressional support than either group has been able to generate by itself.

Teams from MOAA and TMC already have visited Senate sponsors to propose combining S. 585 (Sen. Bill Nelson, D-Fla.) and S. 2177 (Sen. Jon Corzine, D-N.J.) into a single bill when Congress reconvenes. Visits to House sponsors proposed combining H.R. 1726 (Rep. Henry Brown, R-S.C.) and H.R. 1653 (Rep. Jim Saxton, R-N.J.). All four sponsors are enthusiastic about this strategy and are planning to introduce new legislation early in the 109th Congress.

Help generate support for this initiative by signing, stamping, and mailing the tear-out letters that appear before this page and after page 58.

TRICARE in Transition

Switch to new contractors is still a work in progress.

On Nov. 1, the last TRICARE Region completed the switch to the new TRICARE “Next Generation” contracts. Since June 2004, the program has moved from 12 regions and four contractors to three regions and three contractors (TriWest, Humana, and Health Net).

The TRICARE benefit structure remains the same, but there have been changes in program administration that are intended to provide more customer-focused care and better coordination between military facilities and civilian provider networks. The new contracts grade contractor performance against pre-set standards of beneficiary care (e.g., average phone call answering time).

From a beneficiary perspective, the transition has had its share of headaches, and MOAA and The Military Coalition (TMC) continue to work with the contractors, DoD, and the armed services to provide mutual feedback on how to get these concerns resolved.

DoD TRICARE Management Activity (TMA) leaders have posted information on the TRICARE Web site about the extent of the main problems we’ve highlighted, including ongoing efforts to fix them in each of the three TRICARE regions. You can find information about telephone wait times, changes in primary care managers (PCMs), and referrals and authorizations at www.tricare.osd.mil/healthcarecontracts/default.cfm.

*  Telephone wait times: These delays have drawn the most complaints—the new contract’s standard is to talk to a person in 30 seconds or less. The contractors have not been able to meet that goal yet, but they are hiring and training more staff as quickly as possible and shifting call volume to other centers. Of note, until that 30-second standard is met, there are financial penalties for the contractors—so they have strong incentives to try to achieve that standard.

* Authorizations and referrals: One reason hold times have increased is that substantial numbers of patients and their doctors have had to make extended phone calls to try to straighten out authorizations for specialty and other care. Under the new contracts, the government was supposed to field a new electronic referral/authorization system to speed up and simplify that process. Unfortunately, the system wasn’t finished in time, which forced the contractors to come up with manual, stop-gap fix measures until the automated system is available. DoD has put together a “Tiger Team” of senior DoD managers and contractors and put more resources into this effort, but it’s still a ways off.

* PCMs: In areas where the contractors were able to carry over previous provider networks into the new contract, few TRICARE Prime beneficiaries noticed any provider problems. However, in areas where the new contractor couldn’t bring over the previous network participants, many Prime patients found themselves having to switch primary care doctors. According to the TMA Web site, most of those beneficiaries now have new PCMs. Where there still are gaps, the contractor is working with military facilities to finish the assignments.

MOAA thinks DoD health officials and contractors are making sincere efforts to get TRICARE Prime care delivery back within the prescribed access standards as quickly as possible. But MOAA and TMC also have a strong responsibility to track beneficiary experiences and provide independent input that DoD and contractors agree is valuable in our common effort to assure prescribed access standards are met.

TRICARE Jumps to Generics

Switching will save you money, but check with your doctor first.

When Express Scripts International (ESI) took over administration of the TRICARE Retail Pharmacy program contract June 1, 2004, many beneficiaries were caught by surprise as the company began consistently enforcing TRICARE’s preexisting mandatory generics policy. This led to denials of prescriptions for brand-name drugs that many beneficiaries had previously received even though generic equivalents were available.

• The patient has experienced, or would be likely to experience, significant adverse effects from the generic medicine;
   
• the generic medicine has resulted in, or is likely to result in, therapeutic failure; or
   
• the patient has previously responded to the brand-name medication, and changing to the generic medication would incur an unacceptable clinical risk.

If the physician thinks it is medically necessary for the patient to continue to receive the brand-name medication, the physician should call the TRICARE Retail Pharmacy program Prior Authorization Line at (866) 684-4488 to obtain a letter of medical necessity before the patient presents the prescription at the retail pharmacy. Unless the patients have an approved letter of medical necessity before they fill the new prescription, they will have to accept the generic substitute or pay the full price of the brand-name medication.

The ESI letter explains the safety, therapeutic effectiveness, and cost effectiveness of generic drugs. A generic drug is identical to a brand-name drug in dosage form, safety, strength, route of administration, quality, performance characteristics, and intended use. Only those generic medications rated as “A-rated” generic equivalent by the FDA are used, and DoD is taking every measure to ensure that no beneficiary’s health care is compromised.

MOAA agrees that, for most patients, generics provide equivalent benefits while providing substantial cost savings ($3 copayments versus $9 for brand-name drugs). Patients can switch to the generic by asking their physician to write a prescription for a generic drug or by asking their pharmacist to refill the medication with a generic equivalent with provider permission and when permissible by state pharmacy regulations. However, we urge patients to discuss this with their doctor before making a change.

For more information about generic medications go to www.fda.gov/cder/ogd/#introduction. For additional questions regarding the prescription drug benefit, contact ESI at (866) DoD-TRRx (363-8779) to speak with a patient care advocate. To read more about TRICARE’s generics policy, visit www.tricare.osd.mil/status-drug-program-final-8-dec-04.cfm.

Your MOAA Dues’ Worth?

Gains of the past five years generated big savings for most members.

We often get input such as, “I support what MOAA is doing this year for survivors [or last year for disabled retirees, etcetera], but what has MOAA done for the [non-disabled retiree/active duty/Guard-Reserve/other] group I care most about?” A review of recent accomplishments (see “Legislative Gains from 1999 through 2004,”) yields a long list of victories for almost everyone in the military community.

Obviously, all of these successes weren’t achieved by any single organization. They were combined efforts with The Military Coalition, other associations, and thousands of members who pressed Congress for action—and by the legislators who changed the laws. In certain cases, DoD played a strong role, but the greatest victories (e.g. TRICARE For Life, concurrent receipt, and repeal of the Survivor Benefit Plan (SBP) “widows tax”) were won despite strong administration opposition.

But anyone associated with the process will acknowledge MOAA’s leadership role in most of these efforts, so we think it’s worth highlighting what kind of return MOAA members have received on their $24 annual investment in MOAA dues.

* TRICARE For Life: $2,000 annual savings for life ($4,000 a couple) for Medicare-eligible servicemembers who no longer need to carry supplemental Medicare insurance.

* TRICARE Senior Pharmacy: An average of $1,300 a year that each Medicare-eligible member would have spent out-of-pocket on prescription drugs that now are covered by TRICARE.

* Combat-related special compensation: For a 100 percent combat-disabled retiree, this can be $27,000 a year or more, tax-free.

* Concurrent receipt: A retiree 100 percent disabled from other service-connected causes also might get back the same $27,000 a year or more, starting in 2005. Retirees 50 percent to 90 percent disabled will get back $1,800 to $7,000 or more, respectively, in 2005, and these amounts will rise substantially in the years ahead.

* REDUX repeal: Members who entered service after August 1986 no longer are forced to give up 20 percent of future retired pay, as they would if REDUX penalties had not been repealed. This can mean hundreds of thousands of dollars over an officer retiree’s lifetime.

* Military pay raises: Years of effort to restore military pay-raise comparability have added an extra 11 percent to active duty and Guard and Reserve pay since 1999. That also means 11 percent more retired pay for the rest of these members’ lives.

* Military homeowner tax relief: MOAA-led efforts saved thousands of military homeowners from being penalized tens of thousands of dollars in capital gains taxes simply because they were assigned away from home on military orders since 199—including refunds of taxes paid by many who had to sell their homes since 1997.

* Tax deduction for Guard and Reserve drill expenses: The same legislation restored a tax deduction for lodging, travel, and other expenses associated with inactive duty training — worth hundreds or even thousands of dollars a year.

* Guard and Reserve TRICARE: Guardmembers and reservists now get 90 days pre-deployment and 180 days post-deployment coverage with no deductible. Selected Reserve members not on active duty will be able to purchase a year of subsidized TRICARE coverage for each 90 days served in a contingency operation since Sept. 11, 2001. A conservative value for this coverage is $1,000 to $3,000 a year.

* SBP benefit increase: By 2008, elimination of the military “widows tax” will mean an additional $4,000 to $8,000 or more in SBP benefits for survivors of most retired officers.

* VA survivor annuity improvement: Survivors of servicemembers who died of service-connected causes now can keep VA survivor benefits if they remarry at age 57 or older. This protects almost $12,000 a year for the affected survivors.

Stuck With the Bill

Government credit card billing system leaves troops at risk for late payments.

Periodic stories in service-related media have cited problems with government credit cards issued to servicemembers whose duties require official travel. The stories tend to focus on servicemembers who had trouble managing their payments or charged inappropriate expenses. MOAA is concerned about the other side of the story—how the government’s transfer of some of its financial responsibilities to servicemembers can place those members at personal financial and credit risk and inadvertently invite some abuses.
 
Government travel cards are no different than other credit cards when it comes to the potential for late fees, disputed charges, forced account closures, and adverse effects on the holder’s credit history. One key difference is that the government forces military travelers to use the government travel credit card for their official travel expenses—in some cases issuing them to members who might not otherwise qualify for a credit card. Another key point is that the bill for the government credit card bill for official travel expenses goes to the servicemember, not to the government.

Servicemembers and commanders regularly report problems caused by late reimbursement by the Defense Finance and Accounting Service and late receipt of mail because of deployments. But it’s the member who gets charged the late fee. While there are procedures to get reimbursed when this happens, the member must float the bill for the government in the interim or incur the late fee and risk damage to his or her individual credit rating.

Commanders and supervisors also find themselves on the hook to chase down and correct instances of abuse when the servicemember charged personal expenses on the government travel card. Personal charges clearly are not authorized, but it doesn’t take a psychologist to realize that the government’s decision to make the member pay the bills like a personal credit card makes it easy to rationalize, “What’s the harm, as long as I’m paying the bill?”

Most private-sector businesses (including MOAA) do it differently. Company credit card bills for business-related expenses go to the company (not the employee) for payment. There’s no question that the card is for official business use only, and the company takes responsibility for paying its bills in a timely manner, with no risk to the employee. It’s time for the government to take this approach and have government travel card bills sent to the member’s unit or directly to the finance center. This will eliminate 90 percent of the potential abuse and—most importantly—remove the personal financial risk to the servicemember.

Outsourcing bill-paying responsibility to the servicemember is convenient for the government, but that doesn’t make it right. If the government can build a system to pay the member to let him pay the credit card bill, it should be able to cut out the middleman and pay directly.