SecDef testimony Feb 7th - Section on Defense Health program and HSAs ...Former USN Surgeon General speaks out

Since 02-10-06

From: Waspscpo@aol.com [mailto:Waspscpo@aol.com]
Sent: Friday, February 10, 2006 7:33 AM
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Subject: Fw: Former Surgeon General speaks out

Subj: RE: SecDef testimony Feb 7th - Section on Defense Health program and HSAs ...Former USN Surgeon General speaks out
Date: 2/9/2006 7:38:10 PM Eastern Standard Time
From: p38bob@deepwell.com Sent from the Internet (Details)


On Thu, 9 Feb 2006 12:47:11 -0800, "VADM Harold Koenig USN ret" wrote:

The problem with SecDef's testimony and what the Department is requesting is that virtually all of their "re-balancing" effort is being done out of the wallets of a single beneficiary group - retirees and their families under age 65. The trap DOD is in is that retirees <65 are the only group that they can do this to.

The 24-star letter signers won't let them do it to active duty families because it will hurt recruiting and retention. Congress won't allow DOD to hit the over-65's with a premium beyond part B for TFL because it was Congresses way of fixing the "broken promise."

So Rumsfeld is stuck, he has no where to turn but to those retired and their families who are <65. Another interesting revelation in his testimony, and I do not believe he wanted it to be quite this transparent, is where he talks about employers telling people to go use their Tricare benefit.

He acts as if this is wrong. What is wrong with people using the benefit they were promised, earned and are entitled to?

HMK

Harold M. Koenig, MD
Vice Admiral, Medical Corps
U.S. Navy, Retired
.............................................
-----Original Message-----
From: Brig Gen R. Clements USAF ret [mailto:p38bob@deepwell.com]
Sent: Thursday, February 09, 2006 3:10 PM
To: Harold Koenig

Subject: Re: SecDef testimony Feb 7th - Section on Defense Health program and HSAs Copyright 2006 Congressional Quarterly, Inc. All Rights Reserved. Federal Document Clearing House Congressional Testimony

1. February 7, 2006 Tuesday

SECTION: CAPITOL HILL HEARING TESTIMONY LENGTH: 8361 words

COMMITTEE: SENATE ARMED SERVICES TESTIMONY-BY: DONALD H. RUMSFELD, SECRETARY DEPARTMENT OF DEFENSE

Statement of Donald H. Rumsfeld Secretary, Department of Defense before the Committee on Senate Armed Services February 7, 2006

Start of testimony by Secretary Rumsfeld

The pattern of imposing new programs and costs on the military -- without considering the unintended consequences -- is most evident in the area of health care. And, we all are on notice of this growing problem that threatens the Department's ability to fund its other priorities, and therefore future U.S. military capabilities.

As with the changes underway in the Army, there has been a good deal of confusion and misstatement about what the Department is proposing in regard to health care. Let me be clear: the United States military provides -- and will continue to provide -- the best possible care for those who have served our country. But the reality is that the way the current health care system is funded is not sustainable.

Mainly as a result of benefits added by Congress, often without hearings, the Department's health care costs have almost doubled over the past five years -- from $19 billion in 2001 to over $37 billion in Fiscal Year 2006 [ $39 billion in Fiscal Year 2007]. This year's proposed shipbuilding budget, by comparison, is $11 billion.

Using a conservative projection, these health care costs will likely reach $64 billion in Fiscal year 2015, an estimated 12 percent of the total Department budget projected for that year. By comparison, health costs were 4.5 percent of the Department's budget back in 1990.

Because the health coverage offered by the Department is so comprehensive, many private employers are dropping their employer coverage for military retirees and directing their employees to rely on TRICARE instead.

In fact, several state governments have passed rules that encourage their employees who are military retirees to use TRICARE and not their state health care systems. In effect, the military is increasingly subsidizing the health care costs of private corporations, organizations, and state and local governments.

This is a classic example of good intentions leading to unintended, unwelcome, and expensive consequences. Today nearly 60 percent of the Department's inpatient and outpatient expenditures are for retirees and their families, and this percentage is projected to keep rising.

To place the health benefit program on a sound fiscal basis for the long term, the Department is proposing to rebalance the share of costs between retired individuals and the government to approach the levels TRICARE had when the program was initiated by Congress in 1995.

Further, we propose that cost shares be indexed so they will be adjusted annually for inflation. To provide context, in 1995, beneficiaries paid 27 percent of their total health care costs. Today, because there has been no change in TRICARE annual premiums for 11 years, beneficiaries currently pay not 27 percent, but just 12 percent of costs.

The proposed plan would ask retirees to pay somewhat more in premiums and for certain co-payments. However, even after adjustments, TRICARE would still be more generous than the best private employer plans.

For a single retired junior enlisted servicemember, the average price increase for TRICARE Prime enrollment fees would equate to 26 cents per day by Fiscal Year 2008, according to one study. For a retired officer's family the change would amount to $2.58 per day.

We also want to explore for new, innovative benefit alternatives such as health savings accounts, which are currently available to other government employees. A few points should be underscored.

Active duty troops and their families -- people who rely on military hospitals as their sole provider of health care -- will not be affected, except for minimal changes to pharmacy co- payments for family members.

Those retirees over age 65 in TRICARE for life are not affected, except for minimal changes to pharmacy co-payments. And no one will be forced to leave TRICARE.

The plan being proposed, though undeniably necessary and offered with the best interests of the men and women in uniform in mind, has led to predictable concern.

But it is worth repeating: the way the current system is funded is simply not sustainable. Indeed, if current trends continue, health funding pressures will soon cut into budgets for training, equipment, and a range of other investments vital to winning the War on Terror and maintaining the quality of life for our troops and their families.

The Chairman, and the Joint Chiefs of Staff and I, unanimously urge the Congress to join in taking the necessary steps to ensure that we sustain a superior health benefit for the Armed Forces, their families, and all retirees, and to ensure needed future U.S. military capability and a strong national defense. End of Secretary Rumsfelt's testimony
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Comment: Your analysis of the Secretary of Defense's statement (testimony) before the Senate Armed Force Committee is right on the money, Admiral Koenig. Thank you for standing up for our people.


My personal Signature

chk6 bob

"If It Weren't For The United States Military" "There Would Be NO United States of America"