ASSESSING THE QRMC HEALTH CARE PLAN By Col. Steve Strobridge, USAF-Ret. 11-09-2008

The new report of the 10th Quadrennial Review of Military Compensation (QRMC) proposes a number of changes in military pay and benefits. Under the law, DoD must conduct a QRMC every four years.

MOAA has addressed concerns in the past regarding the QRMC¹s proposed changes in the military retirement system (see the Aug. 12, 2008, As I See It, “Purposes and Pitfalls of Retirement Reform”).

Now let¹s take a look at the QRMC health care recommendations.

MOAA strongly agrees with proposals to stress preventive care by removing copayments and deductibles for procedures and medications that are intended to guard against health problems, including colonoscopies, mammograms, and medications intended to control chronic conditions such as diabetes.

Similarly, MOAA thinks the QRMC is on the right track in outlining a variety of initiatives to improve recruiting and retention of the full spectrum of military medical professions and expand contract, reimbursement, and other options to attract the needed level of civilian providers to meet the military community’s needs.

But MOAA has a pretty big hiccup on the QRMC¹s proposals to: –increase and means test TRICARE fees for retirees under age 65; –double retail pharmacy copayments; –establish an annual enrollment fee for TRICARE Standard; and –establish an accrual accounting system to pay for health care for retirees under age 65.

The QRMC would establish an annual enrollment fee for TRICARE Standard and set the fee at 15 percent of the Medicare Part B premium for single servicemembers. The enrollment fee for single retirees in TRICARE Prime would be set at 40 percent of the Part B premium. The premium would be doubled for retirees with spouses or families.

While those amounts would start out at lower levels than the Pentagon and others have proposed, it would represent a fundamental change in the philosophy of military benefits.

First, Part B premiums by law represent at least 25 percent of the cost of delivering care to the elderly and disabled. MOAA doesn¹t think that standard is a proper one for establishing fees for people between ages 38 and 64.

Second, Part B premiums can increase dramatically based on a family¹s adjusted gross income as reported to the IRS. MOAA has a problem with that kind of means testing of federal benefits in any event, but at least there¹s some case to be made for it in social insurance programs like Medicare that apply to all Americans, regardless of their contributions to the country.

But we draw the line at means testing military compensation and benefit programs that are earned by a career of service and are supposed to be provided by DoD as part of the employer¹s compensation package.

Less than 1 percent of the health coverage plans offered by any other American employers vary with income. The U.S. president pays the same for health care as the lowest-grade federal civilian. It makes no sense to MOAA to say that some military retirees who complete 20 to 30 years of arduous service somehow deserve a cut in their military health benefits if they inherit some money from a parent or if their spouse lands an outstanding job.

Further, MOAA doesn¹t support an enrollment fee of any kind for TRICARE Standard or TRICARE For Life (TFL). TRICARE Prime has an enrollment fee because it guarantees access to care for those who enroll. There¹s no such guarantee for TRICARE Standard or TFL, and many military beneficiaries encounter difficulties finding providers who will accept TRICARE, which doctors see as the lowest-paying insurance program in America.

Finally, hard experience has shown that establishing a health care accrual accounting system for retirees under age 65 might be an accountant¹s dream, but it’s a beneficiary¹s nightmare.

The accrual funding system established in 2001 for beneficiaries over age 65 has proven to be a significant hindrance in making needed adjustments because of strict congressional budget rules for any benefit program governed by accrual accounting. That means benefit adjustments can be made relatively easily for retirees under age 65, but making improvements for those over age 65 is nearly impossible. That’s also the reason that it’s like pulling teeth to make even minor adjustments on concurrent receipt or the Survivor Benefit Plan, both of which are covered by accrual accounting systems.

The last thing we need, given the many problems we know exist in the TRICARE system, is another budgetary roadblock in getting them fixed.

Source: MOAA News Exchange

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