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Military Update: House defense spending plan rejects benefit cuts for troops, veterans

By: TOM PHILPOTT Military Update
May 1, 2016 Updated: May 1, 2016 at 8:16 am
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tom philpott, 

With U.S. forces still at war and House members up for re-election in November, the House Armed Services Committee rejected almost every idea the Obama administration proposed in its 2017 budget request to dampen military compensation and apply dollars saved to other defense priorities.

The committee not only refused to force working-age retirees and family members to pay higher fees and co-pays for health care in 2018, it took the unusual step of making its pared-down packet of higher out-of-pocket costs apply primarily to future generations of service members.

Highlights of what the full committee sent to the House floor on a final 60-to-2 vote:

Health care reform

The Department of Defense sought multiyear hikes in fees and co-payments to drive more patients, particularly nonmedical retirees and their families, into managed care and military facilities.

The committee rejected most fee increases but agreed to streamline and narrow Tricare options to a health maintenance organization and preferred provider organization. The health maintenance plan would be called Tricare Prime. Tricare Prime Standard, the fee-for-service insurance option, would be renamed Preferred and its network of providers called a preferred provider organization.

For Prime users, enrollment fees won't change except for annual increases to match the percentage rise of retiree cost-of-living adjustments. For Preferred users, if the U.S. Comptroller General certifies in 2020 that ease of access and other quality gains have been reached, Tricare could begin a $100 a year enrollment fee for singles and $200 for families. Otherwise fees or co-pays for current beneficiaries would be unchanged, including for elderly using Tricare for Life with Medicare.

The Senate Armed Services Committee could adopt health reforms nearer to what was proposed by the DOD. The House committee plan to spare current forces and retirees most higher fees had some senior Democrats questioning its affordability with the 2011 Budget Control Act still set to resume a hard squeeze on future defense budgets.

Allowance extended

For 62,000 surviving spouses who have Survivor Benefit Plan payments reduced dollar for dollar by Dependency and Indemnity Compensation from the VA, the committee voted to extend for one year a Special Survivor Indemnity Allowance. It is intended to ease the impact of the offset, set to climb to $310 a month in October and then sunset a year later. The committee voted to extend the allowance through fiscal 2018.

The long-term goal is still to end the offset entirely, said Nevada Republican Rep. Joe Heck, who led markup of the bill's personnel provisions.

Ex-spouse law tweaked

The 1982 Uniformed Services Former Spouses Protection Act allows divorce courts to divide military retired pay as property jointly earned in marriage. Congress hasn't considered even modest changes to the law for more than a decade. But on Wednesday, freshman Oklahoma congressman Steve Russell, a Republican combat veteran and retired infantry officer, won bipartisan support for an amendment to benefit members who divorce after the defense bill is enacted into law.

Russell took aim at a "windfall" feature of the former spouse law that retirees have criticized for decades. If a member is not retired when divorced, state courts often award the ex-spouse a percentage of future retired pay. In effect, this allows the value of the "property" to rise based on promotions and longevity pay increases earned after the divorce. In 2001, the Armed Forces Tax Council said this was inconsistent with treatment of other marital assets by divorce courts. The amendment would end the windfall in future divorce cases by directing that an ex-spouse's share of retirement must be based on a member's grade or rank at time of divorce.

Commissary reforms

The committee rejected an amendment from Minnesota Democratic Rep. Tim Walz that would have delayed commissary reforms, including adoption of variable pricing, private label brands or the conversion of commissaries to nonappropriated fund activities like base exchanges, for up to two years by mandating more reports and tougher oversight.

Women draft registration

With all combat jobs now open to women, the committee voted 32-30 for an amendment to require women to register with Selective Service System.

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Send comments to Military Update, P.O. Box 231111, Centreville, Va., 20120, email milupdate@aol.com or @Military_Update on Twitter.

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