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LEGISLATIVE NEWS THAT AFFECTS YOU Changes Coming
The House and Senate defense bills reject many of the administration’s proposed TRICARE fee hikes, but some pharmacy copayment increases are coming, despite House efforts to limit them.
T
he chart on pages 36-37 sum- marizes many of the key differences between the versions of the FY 2013
Defense Authorization Bill approved by the House (H.R. 4310) and the Senate Armed Services Committee (S. 3254). Both bills effectively would kill most
of the Pentagon-proposed TRICARE fee hikes, at least for the next fiscal year. Beneficiaries age 65 and older won’t see any enrollment fee for TRICARE For Life (TFL). Beneficiaries under age 65 won’t see any TRICARE Standard enrollment fee or any increase in the Standard deductible. Beneficiaries under age 65 will see only a 3.6-percent increase in their TRICARE Prime enrollment fee as of Oct. 1 — the same percentage increase as the 2012 COLA, thanks to the COLA cap we won in the FY 2012 Defense Authorization Act. No beneficiaries will have their TRI- CARE fees means-tested. These decisions in the FY 2013 De-
fense Authorization Bill could be revis- ited at the end of the year if Congress fails to reverse current sequestration law that would cut another $60 billion from the FY 2013 defense budget as of Janu- ary 2013. MOAA is urging Congress to act now to avoid that huge cut. There will be some increases in TRI- CARE pharmacy copayments, and the main issue is how large the hikes will be. That’s where the House and Senate bills take significantly different approaches.
The Senate bill is silent on the phar- macy copayment issue. Because cur- rent law gives the secretary of defense authority to set pharmacy copayments, the Senate bill silently endorses the DoD- proposed plan to more than double co- payments later this year and triple them over the next five years. The problem the Senate Armed Ser- vices Committee faced in stopping the proposed pharmacy copayment hikes lies in Senate budget rules that require the committee to find other offsetting cuts in either military retirement, survivor ben- efits, or other TFL benefits. Why? Because the offset law applies
to so-called “mandatory spending” pro- grams, and that includes any benefit fund- ed through a trust fund — which TFL is. When DoD proposed higher pharmacy
copayments for all beneficiaries, includ- ing TFL-eligibles, it reduced the budget for TFL spending by the government — with the difference made up by the assumed rev- enues from higher copayments. To reduce or bar the copayment hikes, the committee would have to replace the lost revenue by increasing government spending on TFL. And that requires an offsetting spending cut. The Senate didn’t want to identify an offset — which meant letting DoD leaders double and triple pharmacy copayments. The House thought those copayment
increases were so bad they came up with an alternative proposal that did three things:
AUGUST 2012 MILITARY OFFICER 33
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