- Pentagon seeks to triple health insurance premiums for vets

Buffalo News - Pentagon seeks to triple health insurance premiums for vets

Pentagon seeks to triple health insurance premiums for vets

Some see hardships, breaking of promise

By DAVID GOLDSTEIN
KNIGHT RIDDER NEWSPAPERS
2/18/2006
WASHINGTON - To slow its rising medical expenses, the Pentagon wants to triple the insurance premiums for its 3 million military retirees and their families.

Veterans and their advocates said the plan would create a financial hardship and violate the military's pledge to volunteers who wear a uniform for 20 years or more.

"I think it breaks with the promise the Department of Defense has implied all these years, which is men and women who have dedicated their lives to service, who have fought wars and defended the nation, would get health care for life," said retired Army Col. Michael Neer of Overland Park, Kan., president of the Kansas City area chapter of the Association of the U.S. Army.

The plan was tucked away amid the billions for new jet fighters and warships that the Pentagon requested this week in its proposed budget for the fiscal year that will begin Oct. 1.

William Winkenwerder Jr., assistant secretary of defense for health affairs, said the increases were needed because the military's share of the costs of retiree health benefits had risen 15 percent in the past decade while the premiums had not been raised in 10 years.

"Our fundamental purpose is to maintain and sustain a really outstanding health benefit for all of those we serve - active duty, families and retirees - by placing the program on a sound fiscal foundation," he said. "That is it in a nutshell."

The proposed increases would mean that the annual health insurance premium for a retired officer under age 65 with family coverage would more than triple - rising to $1,400 from $460 - by 2008. Premiums in the next two years for a retired officer with single coverage would jump to $700 from $230.

A retired noncommissioned officer younger than 65, who earns a smaller retirement benefit than an officer, also would take a hit. Family coverage, now $460 annually, would cost from $650 to $950 by 2008. Single coverage, now $230 annually, would cost $325 to $475 in two years.

After that, increases could come through higher co-pays, deductibles and enrollment fees, said Pentagon spokeswoman Cynthia Smith. But she said the net financial effect on retiree health benefits would be no higher than the average health insurance increase for federal workers.

Federal workers, whose health insurance premiums can vary from state to state, generally pay higher rates than the military.