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Wednesday, September 13, 2006

VA Issues: INSURANCE CHANGE COULD COST MILITARY RETIREES



Would ban civilian employers from paying incentives to workers who use TRICARE.

Insurance change could cost retirees

Gannett News Service
By: Dennis Camire
via: VA Watchdog dot Org
September 12, 2006

WASHINGTON---Some working military retirees would lose thousands of dollars a year under a proposed cost-cutting move for a federal health-insurance program.

This year's House and enate defense bills would ban civilian employers---including local and state governments---from paying incentives to military retirees who use the Defense Department's Rricare insurance instead of their companies' healthcare plans.

Dave Winnett, who retired in 1995 after 20 years in the Marine Corps, said the move could cost him as much as $3,000 a year in healthcare payments he now receives from his employer, the city of Torrance, Calif.

"It just seems that as soon as I retired, all I hear about is Washington trying to figure out ways to reduce our benefits," said Winnett, 52, a disabled veteran of the first Gulf War who manages city-owned cars and trucks.

It just seems like we're always struggling to keep what we got."

But the Pentagon says the private-sector incentive payments contributed to an increase in Tricare costs to $36.7B this year from $18B five years ago.

"Those payments may exceed $1,000 a year in some cases." David Chu, undersecretary of defense for personnel and readiness, said this year. As Chu sees it, the Defense Dept is subsidizing healthcare for private-sector employees.

But Steve Strobridge, director of government relations for the Military Officers Association of America, said the proposed change would penalize thousands of retirees whose employers aren't trying to shift healthcare costs to the Pentagon.

Some companies reward any employee who chooses another healthcare plan, such as a spouse's, Strobridge said.

Other companies use a cafeteria plan in which the employer pays a set amount and the employee chooses where to spend it, he said.

Winnett, for example, said Torrance offers all employees the choice between its own plan and a monthly payment toward costs of another plan. He said he uses the city's dental and vision insurance, and Tricare for medical needs.

"This is not something where the city is saying, 'Let's go after those Tricare retirees and force them to use that benefit,'" Winnett said.

Even if Congress approves the change, he is not going to give up Tricare.

"All it's going to result in is me losing money out of my pocket," he said.





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