As reported here, the House Armed Services Committee recently forwarded the National Defense Authorization Act for FY 2013 (HR4310) to the full House for a vote. The bill added back many of the cuts proposed by the White House, and ignored the DoD's request to increase TRICARE Fees for military retirees. (Read the original post)
While most expect it to pass in the House, it is also assumed that the Senate will not pass the current version. And, of course the President would surely veto it if it happened to make it through the Senate. On Wednesday the Office of Management and Budget that confirmed that the President would veto the bill. The OMB statement states, “If the cumulative effects of the bill impede the ability of the Administration to execute the new defense strategy and to properly direct scarce resources, the President's senior advisors would recommend to the President that he veto the bill.”
The OMB's "Statement of Administration Policy" responded to the House bill, declaring the administration’s "disappointment" with the House for not supporting their budget recommendations. The report highlights specific sections of the HR 4310 that differ from their plan, such as limits to the reduction in forces, BRAC, missile defense, and limitations on reduction of nuclear forces, to name a few.
One of the areas we have been watching closely on the Military Advantage is the proposal to hike TRICARE fees. The statement makes it clear that the WH is committed to using the fee increases to make TRICARE sustainable.
The following is an excerpt from the OMB statement:
“TRICARE Fees and Co-Payments: The Administration agrees that retirees deserve a quality health care benefit. For this very reason, the Administration strongly supports its requested TRICARE fee initiatives that seek to control the spiraling health care costs of the Department of Defense (DOD) while keeping retired beneficiaries' share of these costs well below the levels experienced when the TRICARE program was implemented in the mid-1990s. The projected FY 2013 TRICARE savings of $1.8 billion and $12.9 billion through FY 2017 are essential for DOD to successfully address rising personnel costs. DOD needs these savings to balance and maintain investments for key defense priorities. The Administration is very disappointed that the Committee did not support the proposed TRICARE fee increases and included section 718, which, while supporting some fee increases, caps them at levels below those allowed under current law and below the requested authorization. If section 718 remains in the bill, it would only provide five year savings of $2.6 billion.”