Thousands Soon to be Involuntarily Separated from the Army

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According to an article in Defensenews.com, Army Chief of Staff Gen. Ray Odierno said late last year that the Army must soon reduce its numbers by 80,000 personnel and as many as 16,000 of those could be by involuntary separation. The reductions are coming because of the ending of the American combat presence in Iraq and the projected withdrawal of the majority of combat troops now in Afghanistan by the end of 2014.

However, he also said that if Congress could not reach an agreement on the budget and the so-called “sequestration” goes into effect, another 80,000 to 100,000 troops would have to be cut, bringing the total force down to 400,000 personnel. Although he didn’t say how many additional troops would have to be involuntarily separated in that circumstance, it no doubt would be the vast majority of them.

The main focus of the involuntary separations will be staff sergeants in 58 military occupational specialties. Personnel with 15 years of service but less than 20 will be eligible for TERA — Temporary Early Retirement Authority. Soldiers who retire under TERA have the same retirement benefits as 20 year retirees, except that their retirement pay is reduced accordingly.

President’s Column – Daniel J. O’Connell

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Let me begin by wishing you a Happy New Year. It’s hard to believe it’s already 2013. It seems like it wasn’t that long ago that there was real concern about what would happen when 2000 rolled around!

One of the issues we always deal with is the length of time between when we write the Advocate and when you receive it. Obviously it takes time to print and mail it so we try to keep our information as up to date as we can, but it is often the case that events take place after production is in process and we’re not able to be as current as we would like.

We have delayed this issue of the Advocate a little bit because the Senate has been working on passing its version of the FY 2013 National Defense Authorization Act and we wanted to let you know what happened with it. The NDAA is one of two bills that must pass each year for the activities of the Department of Defense. The other is the National Defense Appropriations Act.

The Authorization Act authorizes DoD to do things or instructs it not to do things, while the Appropriations Act funds the activities that the Authorization Act allows. It is the Authorization Act that Congress has used to block the Pentagon from raising TRICARE fees for most of the past seven years and it is what will determine TRICARE pharmacy fees this year.

The House passed its version of the 2013 Authorization Act months ago while the Senate took until December to pass their version. Our “From the Hill” column fills you in on the important details of the Senate’s version of the NDAA. However, after the Senate passed its version a conference committee with the House was held to work out the differences between the two bills. Once they complete that the final bill is sent to the President for his signature and then it becomes law.

In areas where there are differences between the two bills it is impossible to know what will be in the final version until the conference committee finishes with it. So keep that in mind when you read what the Senate did. That is not the last word.

Regarding the Appropriations Act, Congress was not able to pass any appropriations bills to fund the Federal government before the beginning of the 2013 fiscal year on October 1 of last year. Because of that they passed what is called a “continuing resolution” that funds the federal government, including the Department of Defense, through the end of March this year. That means one of their first items of business this year will be to pass a funding bill for the remainder of the fiscal year. What a way to do business!

Finally, whatever happens, you need to be aware that we are in for a major battle this year. There is major pressure growing to cut back on military benefits, including health care, COLA’s, commissary benefits, and there is even talk about military pay being too high. Here are just a few of the headlines that have appeared in the press just before we went into production:

  • “Time to Rein in TRICARE”
  • “Escalating Military Pay Under Scrutiny”
  • “Are Servicemembers Over Compensated?”

We think this kind of talk is outrageous and we will fight to stop these threatened cuts to military benefits. But we can’t do this alone. We need your continued help and support. This year could be the most disastrous we have faced in at least a decade if we don’t win the battles that are coming our way.

Report from the Hill

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After months of delay the Senate finally managed to pass its version of the FY2013 National Defense Authorization Act (NDAA) in early December of last year. This is something that should have happened before October 1.

The bill is crucial for military people because it authorizes most of the activities of the Department of Defense, including health care, commissaries and military pay. This year the Administration had proposed increases in TRICARE pharmacy fees and current law allows the Secretary of Defense almost unlimited discre- tion to raise pharmacy copays. There- fore, Congress had to either block the proposed increases or modify them if they didn’t want the DoD proposals to be put in place.

The Pentagon budget submission expressed intent to increase brand- name copays an additional $2 per year, generic copays by $1 a year, and non-formulary copays by $3-4 a year through FY2017. This became very important because, without going into too many details, the increased fees would allow DoD to reduce the amount of money it requested for its health care budget. And if Congress refused to go along with the DoD proposal, its rules would force it to approve higher spend- ing for DoD healthcare, which would have to be handled by higher taxes or cutting spending elsewhere and moving the money to the healthcare budget. Since Republicans in the House refuse to raise taxes, and since DoD didn’t want to cut any other programs in order to pay for higher healthcare costs, this became a major dilemma.

In June, the House took action to signif icantly reduce the copays and strictly limit the Secretary of Defense’s discretion to impose further increases in the following years.

Under the House version of the NDAA future annual increases would be capped at the percentage increase in military retired pay. That is, if there’s a 3% COLA for 2013, the retail brand- name copay increase for FY2014 couldn’t exceed 51 cents ($17 x .03). This cap is very important because, once established in law, Congress could choose to ignore any future, large Pentagon-proposed increases without being required to come up with any offsetting cuts.

To cap current and future copay hikes, the House decided to achieve the needed savings by establishing a 5-year pilot program under which beneficia- ries age 65 and older would be required o use TRICARE’s mail-order system for ref ills on maintenance medications, at least temporarily. Beneficiaries could opt out of the mail-order refill system after one year, if they choose.

While the copays under the Committee plan are still larger than AMS would like, and while we were reluctant to embrace mandatory mail- order refills, we believed this was the least bad option that was available.

As the Senate dealt with its version of the NDAA in December, three Sena- tors (Reed of Rhode Island, McCaskill of Missouri and Rubio of Florida) intro- duced an amendment to tie TRICARE fee increases to the cost of living adjust- ments for TRICARE beneficiaries. This was essentially the same thing that was in the House version of the NDAA. Unfortunately, the amendment failed which means the Senate NDAA does not address the TRICARE pharmacy issue, which causes it to go along with the DoD proposal.

This important issue must be worked out in conference committee and sent back to each body for final passage before it goes to the Presi- dent for his signature. AMS strongly supports the House language regarding TRICARE pharmacy increases and we will report on the results in our next issue.

The White House had also requested TRICARE healthcare fee increases in its budget proposal, which the Senate did remove from its final bill. Since the fees were also excluded from the House bill there will be no TRICARE fee increases in 2013, but it’s almost guaranteed that DoD will come back again and request them in next year’s budget.

The White House threatened to veto the Defense bill over three items it disagreed with: 1) the removal of the TRICARE fee increases (not the phar- macy increase, but TRICARE health- care); 2) a provision limiting transfer of detainees from Guantanamo Bay Cuba to prisons in the U.S.; and limitation on the amount of cuts that DoD will be allowed to make in the Air National Guard and funding for upgrades to the M-1 Abrams tank. However, very few people take the veto threat seriously.

In a speech on the floor of the Senate during consideration of the NDAA, Senator John McCain, perhaps the best known military retiree in Congress, said Congress should increase TRICARE fees and he urged his colleagues to support increase next year. AMS is stunned that McCain would be one of the chief crusaders for TRICARE fee increases and we urge residents of Arizona to contact McCain and let him know your thoughts about his support for increasing TRICARE fees.

One of the good things to happen in the NDAA was a 1.7% pay raise for active duty personnel. But with growing talk about the military being overpaid, we expect a battle over a pay raise next year.