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MOAA: Military Officers Association of AmericaMOAA Legislative Up.
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MOAA Legislative Update: Roth TSP/SBP Allowance
Bill Passes
April 03, 2009
USPHS/NOAA Corps to Get Post-9/11 GI Bill In a much-welcome surprise, the VA announced this week that USPHS and NOAA Commissioned Corps officers will be entitled to educational benefits under the Post-9/11 GI Bill if they performed qualifying active duty after September 10, House Leaders Expect DoD TRICARE Fee Hikes Leaders of the House Armed Services Committee say they expect renewed Pentagon calls for significant TRICARE fee increases for military retirees. Get your oar in the water now! Budget Resolutions: Pay Raise, TRICARE, and More The House and Senate passed their respective budget resolutions this week, with special nods (but not many solid commitments) to More on the “Economic Stimulus” Tax Two weeks ago, we told you about a glitch in the IRS rules regarding the federal income tax break in February’s economic stimulus that could leave retirees with an unexpectedly large tax bill in 2010. Find out how to protect yourself.
Roth TSP/Survivor Allowance Bill Passes A new House-passed bill includes a provision to authorize a Roth Thrift Savings Plan option for military members and federal civilians and a provision to increase payments to 55,000 military widows.
More $22 Drugs DoD plans to move some asthma medications to the third tier, or $22 copay USPHS/NOAA Corps to Get Post-9/11 GI Bill
In a much-welcome surprise, the VA announced this week that USPHS and NOAA Commissioned Corps officers will be entitled to educational benefits under the Post-9/11 GI Bill if they performed qualifying active duty after September 10, 2001. The language of the new law doesn’t specifically cite their eligibility. But VA lawyers found a 1985 legal opinion that let them include the USPHS and NOAA Corps in the new program. Under the Post-9/11 GI Bill, the VA will pay the full cost of undergraduate tuition and fees at any public college or university program for veterans who have 36 months active duty since September 10, 2001. The benefit can be used for undergraduate, The VA also will pay a monthly housing allowance equal to the basic allowance for housing payable to an E-5 with dependents, in the same zip code as the school; and, a yearly book stipend of $1,000 per year. Benefits may be paid during active duty service, with the exception of the housing stipend. The VA’s decision leaves no wiggle room to permit the USPHS/NOAA Corps officers to transfer their benefits to a spouse or dependent children. The law gives DoD the exclusive authority over “transferability” as a tool to induce longer service through reenlistment or a service extension agreement. For instance, the Post-9/11 GI Bill permits DoD to offer transfer of benefits to spouses at the sixth year of service in exchange for a four-year extension or reenlistment and at the completion of the 10th year to A law change now will be required to authorize the Dept. of Health and Human Services in the case of USPHS officers and the MOAA: Military Officers Association of AmericaMOAA Legislative Up.
http://www.moaa.org/lac/lac_issues/lac_issues_update/lac_issues_updat.
Dept. of Commerce in the case of NOAA Corps officers to transfer the benefits to spouses or children. MOAA has been working closely with the Commissioned Officers Association of the US Public Health Service, a Military Coalition partner, VA officials and congressional staff to urge the change. USPHS and NOAA Corps officers have been entitled to every GI Bill program since World War II and we are pleased to see this outcome. House Leaders Expect DoD TRICARE Fee Hikes
Leaders of the House Armed Services Committee say they expect the Pentagon will once again propose big TRICARE fee hikes for Their March 15 letter to the Chairman of the House Budget Committee was very specific on the latter point, and asked for extra budget authority to reject the expected increases. “The committee believes that the [end of April] budget request will again assume over $1 billion in savings within the Defense health budget, based on recommendations from a previous Defense Department Task Force,” said the letter signed by Chairman Ike Skelton (D-MO) and Ranking Minority Member John McHugh (R-NY). “The committee will need additional [budget headroom] to prohibit the fee increases that we expect will be proposed by the Department of Defense.” If you agree with MOAA that that’s the last thing the Defense Department should do, you still have time to weigh in with the President and the Secretary of Defense, but you need to act quickly. E-mail President Obama: Use MOAA’s special alert. E-mail Secretary of Defense Gates: The Secretary has no public e-mail address, so you have to go to the DoD Web site, click on the “Ask a Question/Make a Comment” tab at the top, fill out the required information, and include this recommended comment: For Secretary Gates: As you prepare the FY2010 budget, please don't resume past failed efforts to impose unfair TRICARE fee
increases on retired military families. Career military people were told that their decades of arduous service and sacrifice constituted a steep, pre-paid premium that earned lifetime health coverage. Large proposed TRICARE fee hikes have been upsetting because they devalue those decades of sacrifice -- in wartime, no less. Please seize this opportunity to suspend these divisive efforts and work with military associations to develop positive incentives and 'win-win' solutions for all concerned. Budget Resolutions: Pay Raise, TRICARE, and More
The House and Senate approved their respective versions of the FY2010 Budget Resolution on Friday before taking off for the two-week Easter recess. In the meantime, House and Senate leaders will be working to resolve the differences between the two versions so they can pass a final resolution once Congress reconvenes. Of necessity, Hill leaders find themselves in a “cart-before-the-horse” mode this year. Their rules require finishing the budget resolution before April 15, on the assumption that the President’s budget is delivered to them in February. But every newly elected administration needs extra time to prepare its initial budget – which won’t be delivered to Congress until the end of April. In March, leaders of the House and Senate Armed Services Committees wrote their respective Budget Committees to request extra budget headroom for several specific priorities. Their requests included extra allocations for a 3.4% military pay raise (vs. the 2.9% proposed by the Pentagon), additional progress to ease VA compensation offsets to military retired pay and SBP annuities, and to reject any increases in TRICARE fees that the Administration may propose in its final budget submission. MOAA: Military Officers Association of AmericaMOAA Legislative Up.
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The recommendations of both Armed Services committees for 3.4% pay raise are a very good sign that it will be approved, as the full Congress has agreed with such joint recommendations in the past. Both budget resolutions also include “deficit-neutral reserve funds” that could potentially address compensation improvements for disabled retirees; SBP-DIC survivors; Guard-Reserve retirement, health and GI Bill benefits; and DoD and VA health care issues.
It’s nice that Congress acknowledged those needs, but these provisions offer no firm commitments. The “deficit-neutral” qualifier means they can be done only if Congress finds other “mandatory spending” reductions to offset any increases in those areas. The difficulty of identifying such offsets is why we haven’t made more progress in past years. More on the “Economic Stimulus” Tax
The recent stimulus plan reduces federal income taxes up to $400 for working individuals and $800 for couples via smaller tax withholding from their paychecks. Non-working military retirees or survivors are not eligible for the tax reduction, but will see the reduced withholding in their retired pay or survivor annuities. That’s because DFAS is required to use the new tax withholding tables published by the IRS for retired paychecks or annuities To add to the confusion, the stimulus bill also provides a $250 payment to those drawing Social Security or VA disability compensation. So if a retiree or survivor draws VA disability or Social Security, he/she will get the $250 payment on top of the A working retiree who also draws Social Security or VA disability compensation will get the $250 payment and will also have the additional $400 ($800 married filing jointly) withheld from BOTH military retired pay AND employer pay. There will be some rude awakenings next year when retirees or survivors discover they’ve been “under-withheld” and owe an unexpectedly large tax bill on their 2009 taxes. Check out some examples and how you can protect yourself. MOAA has written congressional leaders and Treasury Secretary Geithner urging exemption of taxable retired pay, pensions and annuities from the lower withholding. If this effort is unsuccessful, retirees can ask DFAS to restore their original withholding on their retired pay or annuity to avoid a bigger 2009 tax bill. Roth TSP/Survivor Allowance Bill Passes
On Tuesday, MOAA received a call from the House Armed Services Committee staff requesting our help in supporting legislation that House Armed Services Committee Chairman, Ike Skelton (D-MO), hoped to bring to the House floor to improve payments to SBP-DIC widows and allow military and federal civilian personnel a Roth option on their Thrift Savings Plan. Skelton managed to include this provision in an unrelated tobacco bill (H.R. 1804), outside of the normal Defense Authorization bill process. MOAA put out a special email alert generating 8,000 messages to the Hill in less than 24 hours, and the measure was The bill provides for increases in the special survivor indemnity allowance (SSIA) that began last October. The current payments start at $50 a month, but ramp up to $100 per month by 2013. The new legislation would increase those monthly amounts over We’ve had some inquiries as to why we supported an increase in the current modest payment rather than holding out for full repeal of the SBP/DIC offset. The answer is that it’s not an “either-or” proposition. Nobody, especially MOAA, sees H.R. 1804 as the answer, by any means – only as one more step toward the answer. In essence, MOAA: Military Officers Association of AmericaMOAA Legislative Up.
http://www.moaa.org/lac/lac_issues/lac_issues_update/lac_issues_updat.
it’s an opportunity out of the blue to at least raise the payment floor for the SBP/DIC widows. This was a “bird in the hand” opportunity, but certainly does not dampen our campaign for full repeal. In fact, every small step we take on this issue diminishes the resistance to repealing the entire offset – and it makes the cost of full repeal go down, too. More $22 Drugs
In March DoD proposed moving some asthma inhalers to the third tier, or $22 copay level. The following inhaler medications will remain at the lower copays of either $3 or $9: Asmanex, Pulmicort Respules, Flovent HFA and Diskus, Serevent, Floradil, Brovana, Advair HFA and Diskus, and Symbicort. The following drugs will be available at the $22 copay: Alvesco, Pulmicort Flexhaler, QVAR, and Perforomist. Aerobid and Azmacort were also moved to the third tier but they are expected to be removed from the market because they contain chlorofluorocarbon DoD proposed adding the TRUEtest blood glucose monitoring test strip to the regular formulary. The test strip is used in The new third-tier recommendations will be submitted to the Assistant Secretary of Defense (Health Affairs) for final decision. DoD will provide notifications to all beneficiaries currently taking the medications being moved to the third tier so that they and their doctors can consider alternative medications available at the lower copay. Information on alternative medications can be found via A doctor who believes it is important for a patient to take the third-tier medication can provide “medical necessity” justification to TRICARE. If approved, the patient will continue receiving the medication at the lower copay. Legislative Update Archives
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