Late last year the House and

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1 Volume 18 Number 2 March - April 2004 An Important Message about TRICARE and Medicare Late last year the House and Senate passed the "Medicare Prescription Drug, Improvement, and Modernization Act of 2003" which the President subsequently signed into law. This bill is extensive and complex, and it makes dramatic changes to Medicare. It is important for uniformed services beneficiaries to understand the effect these changes may have on them in the near future and in the years to come. A preliminary assessment of some of the bill's provisions is presented below. As additional provisions of interest to uniformed services beneficiaries are identified, and as more information becomes available, we will let you know. If you have questions about your TRICARE benefits that are not answered here, you should contact your local TRICARE Service Center for assistance. Medicare Prescription Drug Benefits For most Americans, the most significant aspect of the new bill is that it introduces an outpatient p rescription drug benefit. This does not affect uniformed services beneficiaries because their TRICARE pharmacy benefits will continue as a separate program. Beneficiaries who desire to participate in the Medicare outpatient prescription plan should enroll when first eligible. If a beneficiary does not enroll when first eligible, and subsequently desires to do so, an annual late penalty would normally be assessed. However, TRICARE pharmacy benefits are considered a creditable prescription plan under the bill, and as such, uniformed services beneficiaries who do not enroll in the Medicare prescription drug benefit when first eligible do not have to pay an annual penalty if they subsequently enroll because they involuntarily lost their eligibility under TRICARE. Individuals could involuntarily lose their TRICARE eligibility when a dependent widow or widower remarries a person who is not a uniformed services member or retiree, or when a dependent and member or retired member divorce, and the dependent spouse does not qualify under the law as an eligible former spouse for TRICARE benefits. The TRICARE pharmacy benefit provides excellent coverage and wide availability of services through military facilities, retail pharmacies, and mail order. Thus, it is likely that the vast majority of uniformed services beneficiaries will not find it advantageous to enroll in the new Medicare pharmacy benefit. TRICARE and Medicare will need to establish procedures for coordination of benefits for beneficiaries who do decide to sign up for the Medicare benefit. continued on page 6 Veterans Affairs Directive Gives Priority to Disabled Vets The Veterans Affairs Department wants to send veterans with service-connected medical problems to the front of the line when it comes to receiving medical treatment at VA facilities. VA Secretary Anthony J. Principi issued a new directive to all VA medical facilities requiring that "priority access" be given to qualifying veterans seeking appointments for treatment. The directive covers hospitalization and outpatient care, and does not apply to veterans seeking care for medical problems not related to a service-connected disability. Priority access, Principi explained, means that when qualifying veterans come to a VA treatment facility for inpatient or outpatient care, they will receive an appointment within 30 days. "It's really as simple as that," he said. Veterans seeking treatment need only let the administrative clerk or nurse know of their service-connected disability status, the secretary added. If a VA facility is unable to schedule an appointment within the 30-day time limit, an appointment must be arranged for care at another VA facility, or at a facility under contract in the private sector. continued on page 2

2 Chairman Calls Guard and Reserves a National Treasure In this time of crisis, the reserve components are doing exactly what they were designed to do, Air Force Gen. Richard B. Myers said recently, and America is grateful for their service. Myers said reservists are integrated seamlessly into the total force, and they are serving in all aspects of the war on terror. "You can be in the loneliest place on the planet with five folks gathered, and if you ask are there any Guard and reservists, you usually get a third or two-fifths of the hands (going) up," Myers said. The chairman said it is almost impossible to tell a reservist from an active duty service member, so many active duty personnel don't know how much the force depends on citizen soldiers. "Four centuries ago, our militias took up their muskets to defend their families, their friends, and to fight for their liberty," Myers said. "Today our allvolunteer force fulfills that solemn contract spelled out in the first lines of the Constitution 'to provide for the common defense.'" The reserves are doing exactly what they were designed to do, Myers said, ready to spring to action the second they are needed. "This continues a legacy of dedication, of selflessness: To stand when called, to act on behalf of others in the face of danger," he said. Myers said the current war on terror is the most important time to serve in generations. "In America, regardless of our religion, accent or color of our skin, we answer the call to arms to defend the innocent and protect the peace," he said. "Terrorists, on the other hand, seek to murder innocent civilians and provoke fear. The contrast couldn't be greater." Myers said that when a deployment order comes to his desk in the Pentagon, he is aware of the implications. "I truly don't see just another unit mobilizing to deploy," he said. "I know that as we sign these things, there are individual men and women with wives and husbands and children and parents and for our reserve warriors, of course, a job and a life outside the military. "I never forget that our reserve is a treasure and an important advantage to this great country," Myers continued. continued on page 4 Priority Given to Disabled Vets continued from page 1 "I've always felt that it is important to give veterans with service-connected disabilities a priority for care," he said. "I want to make sure that those who have disability related to military service have a high priority for health care, whether it is inpatient or outpatient, and this new priority scheme is to ensure that those who are disabled go to the 'front of the line.'" The new policy will not be without its challenges. Some 25 million veterans are in VA's health care system, and the department reports the number of veterans seeking medical care has risen significantly, from 2.9 million in 1995 to nearly 5 million in The VA operates more than 1,300 medical facilities, including 162 hospitals and 800 outpatient clinics, but officials report the increase in veterans seeking care "outstrips VA's capacity to treat them." The secretary acknowledged that veterans have suffered long waits for appointments at medical facilities in some parts of the country, but he said the goal for his department will be to reduce those lines and to ensure that veterans are cared for in a timely manner. In the past, priority access to health care went only to veterans with disabilities rated at 50 percent or more; for severely disabled veterans, priority is extended for nonservice-connected medical problems, according to VA guidelines. However, Principi said, the new directive now makes priority access available to all veterans injured in service to the country. He said the VA was established to care for the men and women who served in the armed forces, and that "we should never lose sight of that." He said his department's priority must "always be the men and women disabled in service to their country." In addition, Principi said his department will work harder to reduce the backlog of disability claims for veterans. And he said VA is making "tremendous progress" in that effort. "They've shown renewed commitment ensuring that if a veteran files a claim for disability compensation, he or she doesn't have to wait six months to a year. We are going to get that claim decided in 100 days or less." from American Forces Press Service by Sgt. 1st Class Doug Sample, USA NATIONAL CEMETERIES As more and more elderly veterans of World War II and Korean Wars die, National Cemeteries need more space. The National Cemetery Act of 2003 Authorized VA to establish six new national cemeteries, the largest expansion since the civil war.

3 P R E S I D E N T S C O L U M N DOUG RUSSELL These are confusing and ironic times for military people. On the one hand, I think it s accurate to say that our active duty forces haven t been held in such high regard by the American people since the end of World War II. Even those who were against the attack on Iraq were careful to say they supported our troops, even if they opposed the war. On the other hand, there are some disturbing events occurring with regard to the promised and earned benefits of military retirees and veterans. For instance, I recently read a story about the Armed Forces Retirement Home in Washington, D.C., that troubled me a great deal. The Armed Forces Retirement Home actually consists of two facilities: the U.S. Soldiers' and Airmen's Home in Washington, D.C., and the U.S. Naval Home in Gulfport, Miss. Originally established in the mid-1800s to provide safe haven for elderly and disabled soldiers and sailors, they have evolved into retirement communities offering a secure and comfortable life style. The Washington, D.C., Home was founded in 1851 as a veterans asylum and was funded by booty carried home from the U.S.-Mexican war. It is located on one of the highest elevations in Washington and President Lincoln escaped to the facility each summer of his presidency to get relief from the heat and humidity of the lower parts of the city. In fact, he wrote the final draft of his Emancipation Proclamation in a cottage on the grounds. Approximately 1,600 veterans from every military service reside in the retirement homes with about 1,000 in the Washington facility. Their average age is 76. About 85 percent saw duty in World War II, 30 percent served in Korea and 10 percent in Vietnam. They come from every state in the union. About 150 of the residents are women. As you may remember, you had 50 cents deducted from every paycheck you got from Uncle Sam when you were on active duty. Those fees went directly to support the Washington and Gulfport homes. However, with the downsizing of the Armed Forces, the amount of money going to the homes has shrunk accordingly. When they were made aware of the problem, Congress passed a law authorizing $1 to be deducted from every active duty paycheck to make up for the loss in revenues, but because of dissension in the Pentagon over the increase, it has not been implemented. Now, the Washington, D.C., home is facing a financial crisis that has resulted in a reduction in the operations and expenses of the facility. Within the last couple of months 65 staff positions have been eliminated and many long-term employees were replaced with contractors. According to the new Chief Operating Officer for the Home, if the changes hadn t been made the trust fund out of which the Home operates would have gone bankrupt in five years. Of course, I m glad the changes will keep the facility operating, but it s troubling to me from two aspects. First, I think it s unacceptable for DoD to have blocked the 50 cent increase in the payroll deduction after Congress authorized it. I realize it s taking more money from the active duty troops, but it only amounts to a $6 a year increase. That doesn t seem to me to be asking a lot, and I think it helps keep a connection between those serving today and those who have served before them. Secondly, it s troubling that more isn t being done by the Administration and Congress to try and make sure both homes remain open and provide the kind of care that those who have served our nation deserve. While it s true that 1,600 people is not a large percentage of the overall number of veterans and retirees, it is hugely symbolic of what our government really thinks about its military veterans. And, of course, what happens to the two homes is of major significance to those who live there. Another very disturbing instance of taking back a promised benefit is a recent proposal that came out of the Bush Administration s Office of Management and Budget (OMB). The proposal would have resulted in a doubling, and in some cases a tripling, of the cost of prescription drugs for retirees. In addition, OMB wanted to charge for drugs obtained at a military pharmacy. Because of an outcry from AMS and other military associations, the DoD comptroller rejected the idea of including the proposal in the FY 2005 budget, but agreed to form a committee to consider including the proposal in a future budget, perhaps as soon as 2006 which, conveniently enough, is after the presidential election this year. You can rest assured that AMS will watch this issue like a hawk and we ll warn you if it raises its ugly head again. To me, these are two very important reminders that military retirees and veterans simply cannot trust DoD to take care of them. You need your military association to fight for you. That s what we do at AMS, and I urge you to remember that when your AMS membership comes up for renewal.

4 'National Treasure' continued from page 2 He said citizen-soldiers remain absolutely essential to Operation Iraqi Freedom, and that the Defense Department has tried to "do what is right" for reserve component service members. He acknowledged that effort has been imperfect, and said many in the Pentagon and with the services are striving to solve the problems that have cropped up. Overall, he said, the mobilization process needs to be changed. "We owe you all as much notice and predictability as we can, not only in times of war but in peace, to ease the personal and financial burdens (of service)," he said. Myers said the military must look to see if the reserve components have the right balance of skills and numbers of people. "We certainly can't afford to call up the same high-demand units time after time after time," he said. "Because we wouldn't have you for long if we did. "We don't want to destroy the health of our magnificent reserve forces," he continued. "We don't want to abuse your trust and your service." Myers said the services are looking at structural changes in the reserve components. He said the military no longer can afford duplications or inefficiencies. "We have to be sure each person adds to our warfighting capability. He said this type of transformation will require some units to retrain, reconfigure or change missions. He also said he is looking for ways to give reserve personnel more opportunities to participate in joint professional military education. Reserve service has a long history in America, and today is no different, Myers said. "In time of need, when our country needs them the most, (reservists) lock arms to form an unbreakable, unbeatable team," he said. "Dedicated to defending the liberties we all cherish and supporting people who are struggling to enjoy that same freedom. from American Forces Press Service by Jim Garamone Legislative Update AMS is tracking important legislation now before Congress. Here are just a few of the bills that we support and that may affect you. S Waive Medicare Pa rt B Late Enrollment Penalties Purpose: S would waive future Medicare Part B late enrollment penalties for military retirees who signed up for Medicare during the years To qualify for TRICARE For Life (TFL), uniformed services retired beneficiaries must be eligible for Medicare Part A and enrolled in Medicare Part B. Beneficiaries who do not enroll in Part B when first eligible (usually age 65) are assessed a premium penalty of 10% per year for each year not enrolled. Also, it would create a special Medicare Part B enrollment period for military retirees through December 31, Status: Provisions similar to S have been included in both the House and Senate versions of Medicare reform legislation. These provisions differ slightly, and will have to be resolved in conference between the two chambers. As of yet, conferees have been unable to reach agreement on a final Medicare bill. However, most believe that if negotiators are unable to compromise, a separate Medicare bill will be passed, incorporating all the non-controversial aspects of H.R. 1 and S. 1. In that instance, it is believed that Medicare Part B late enrollment penalty relief would be included. S Guard/Reserve Health Care Benefits Purpose: S. 852 would authorize wraparound health insurance options available for Guard and Reserve Servicemembers. It would allow them and their family members to join the TRICARE program on a cost-share basis. Alternatively, they could receive a partial government subsidy of their employer-provided health insurance. S. 852 would also improve health care transition services ("Cobra"-like coverage) for those undergoing mobilization. Status: The FY 2004 National Defense Authorization Act (H.R. 1588) authorizes a one-year trial of cost-share access to TRICARE for uninsured or unemployed members of the Selected Reserve and certain members of the IRR subject to Presidential recall. The NDAA also lengthens the period of pre- postmobilization coverage under TRICARE for all activated members of the reserve forces and their families. S Keep Health Care P romises Purpose: This legislation, if enacted, would allow all uniformed services retirees and their families the opportunity to enroll in the Federal Employees Health Benefits Program (FEHBP) as an alternative to TRICARE. Members who entered a uniformed service prior to June 7, 1956 would be eligible to enroll in an FEHB plan with the government paying the total premium; members entering service on or after that date who elect to enroll in an FEHB plan would pay premiums on the same basis as retired federal employees. June 7, 1956 is the date that Congress enacted legislation to limit access to care in military treatment facilities for retired beneficiaries on a "space available" basis. Status: S. 56 has been referred to the House Armed Services Committee (HASC).

5 H.R Military Retirees Health Care Improvements Purpose: H.R would allow military retirees and their dependents the option to enroll in the Federal Employees Health Benefits Plan (FEHBP); waive Medicare Part B premiums for retirees who entered service before June 7, 1956; and provide drug reimbursement at TRICARE network rates to beneficiaries who do not have access to a pharmacy in the TRICARE retail network. Status: H.R has been referred to the House Committees on Armed Services, Government Reform, Energy and Commerce, and Ways and Means. H.R Tax Deductible Long Term Care Insurance Premiums Purpose: H.R would allow an "above the line" deduction on premiums paid for long-term care insurance. The deduction would be allowed for taxpayers with an Adjusted Gross Income (AGI) of up to $75,000 for a single filer (or a couple filing jointly up to $150,000). The amount of the deduction would be phased in, starting with 25 percent of the premium in 2003 through 2005, 35 percent in 2006, 65 percent in 2007 and 100 percent in 2008 and thereafter. Importantly, H.R also would allow a tax credit for long-term care expenses paid by the taxpayer for care and support of individuals with long term care needs. The credit amount would be phased in starting at $1,000 for 2003, raising by $500 per year to $3,000 in 2007 and thereafter. Also, H.R would allow the long-term care insurance to be covered under cafeteria plans and flexible spending accounts. Status H.R has been referred to the Ways and Means Committee, and Rep. Nancy Johnson (R-CT) has expressed optimism about its chances for passage. S Increase SBP Age-62 Annuity Purpose: This bill would increase the minimum Survivor Benefit Plan (SBP) annuity from 35% to 40% of SBP-covered retired pay for survivor's age 62 and older, on Oct 1, It would further increase the post-62 annuity to 45% of SBPcovered retired pay as of Oct 1, 2008 and to 55% as of Oct 1, The bill includes an open season provision that would allow currently unenrolled retirees to participate in the new and improved program. Open season participants would pay an additional premium proportionate to the number of years since their retirement. Status: Introduced Nov 21, Focus of effort is now on seeking funding authority in the FY 2005 Budget Resolution. Reunion Announcement The AE Sailors Association, Inc., will hold its reunion October 27-31, 2004, at the Clarion Hotel Charleston Airport in Charleston, S.C. For further information contact Jerry King, President, 1018 Calle Ortega St., San Dimas, CA phone) ) dd694@aldelphia.net web site) New Ways to Help Troops in Iraq and Afghanistan If you ve been wishing you could do something tangible to show your support for our troops in Iraq and Afghanistan, there is new information on how you may do so. First, a new Web site has been established that will be of help to you. If you go to sss.woundedwarriorhospitalfund.org, you can check out the latest news and find ways to send clothing items and toiletries, as well as sending monetary donations. You can also send cards, letters or even a goody package to the troops, to the following addresses. (Please note that you are asked NOT to send homemade cookies or baked goods. Undoubtedly this is for both security reasons and because of spoilage.) For troops in Afghanistan send to: LTC Kenneth Sampson, HHC CJTF 180, APO AE For troops in Iraq, send to: COL Douglas Carver, HQ V Corps, Unit 91400, APO AE For wounded personnel at Landstuhl, Germany, hospital send to: Major Shirley Crumpton, LRMC, CMR 402, APO AE

6 An Important Message about TRICARE and Medicare continued from page 1 Pa rt B Premiums The bill makes three very important changes relating to enrollment in Medicare Part B, the Supplementary Medical Insurance Program. The first two changes affect persons not enrolled, or paying surcharges because they enrolled after they were initially eligible for Part B. First, uniformed services beneficiaries who would be eligible for TRICARE For Life, but are not enrolled in Medicare Part B, may enroll without penalty during a special enrollment period through December 31, The special enrollment period will be announced via Medicare on the TRICARE Web site ( and publicized widely. Second, uniformed services beneficiaries who enrolled in Medicare Part B in 2001, 2002, 2003, or 2004 and are subject to a premium surcharge for late enrollment in Part B can get those surcharges eliminated by demonstrating that they are covered under TRICARE. The elimination of surcharges is effective January 1, 2004, but the Department of Health and Human Services will need to work out procedures to be followed. Procedures will be announced via Medicare on the TRICARE Web site ( and publicized widely. The third change made by the bill affects all seniors, not just uniformed services beneficiaries. The Part B Daylight Savings April 4th premium will be tied to income, beginning in Individuals with incomes above $80,000 will pay more, and couples with incomes above $160,000 will pay more. Medicare Advantage P rogram The bill introduces several enhancements to the current Medicare+Choice program that are expected to increase the availability of private plans offering benefits to Medicare beneficiaries. TRICARE For Life beneficiaries can enroll in Medicare+ Choice plans (and TRICARE will reimburse their copayments). More details about Medicare+Choice plans are available on the Medicare Web site: view.asp. Most people eligible for Medicare use traditional fee-for-service Medicare. The bill includes provisions for a pilot program beginning in 2010 (the Comparative Cost Adjustment program) that could result in increased Part B premiums for persons in traditional feefor-service Medicare, if sicker patients gravitate to private plans in the test sites. P rovider Reimbu rsement P rovisions The bill includes numerous provisions relating to reimbursement of hospitals, physicians, and other service providers. Significantly, physicians will receive a 1.5 percent payment increase in 2004 for 2005, rather than the reduction that was anticipated. Medicare Pa rt B Deductible The bill increases the Medicare Part B deductible to $110 in 2005 and indexes it to inflation for subsequent years. This should have minimal impact on uniformed services beneficiaries, since the Medicare deductible is payable by TRICARE. IOM Creates Web Site for Veterans The Institute of Medicine (IOM) has created a new Internet Web site with information about a variety of military-related health issues. "IOM's new Web site is one more tool available to veterans, health care practitioners and others interested in the well-being of our veterans," said Secretary of Veterans Affairs Anthony J. Principi. The Web site, at veterans.iom.edu, has separate sections for health care issues affecting the last four major military conflicts - World War II, the Korean War, the Vietnam War and the Gulf War. At each section, visitors can read electronic versions of IOMproduced reports or purchase publications. Other sections list IOM's completed reports and reports in progress, while another area contains studies about chemical and biological agents suspected of causing health problems for military members. There is also a section with reports and information about deployment health. Part of the National Academy of Sciences, the Institute of Medicine is a nonprofit organization that provides advice on matters of biomedical science.

7 American Military Society Membership Application Form P.O. Box Washington, D.C (800) Yes, I want to join in support of a strong national defense and take advantage of the great benefits AMS offers. I also understand that I am joining an organization that fights for the compensation, benefits, and entitlements of all military personnel of the uniformed services. Name: DOB: / / SSN: - - Address: Branch of Service City: State: Zip: Grade: Rank: Telephone:( ) Membership Category: General Associate Sustaining My Status/Spouse is/was: Active Duty Reserve National Guard Retired Honorably Separated 1 year $18 2 years $36 3 years $54 Lifetime Membership $250* * Lifetime Membership may be paid in 10 quarterly payments 1st payment of $25 is enclosed. Make your check payable to: American Military Society Charge my dues to: VISA MasterCard Card# Exp. Date: / Signature: The AMS Advocate is published bi-monthly by the American Military Society: 1 (800) Doug Russell President Larry Madison Editor and Senior Writer Membership: 1 (800) Insurance Coverage/Billing: 1 (800) Insurance Claims: 1 (800) Material may be quoted or reprinted in part or whole as long as proper credit is given to AMS. Membership in the American Military Society is open to all members from all branches of the armed forces, both officers and enlisted personnel, including Active Duty, Reserve, National Guard, Retired and Veterans, as well as spouses and widows of the uniformed services family. Any individual who supports the aims and purposes of AMS is eligible for Associate Membership. Any business entity, local government, or civic group that supports the aims, objectives, and purposes of AMS is eligible for sustaining membership. AMS Benefits and Services Special Notice to AMS Members: Due to recently revised postal standards, we can no longer list specific AMS Member Benefits without losing our ability to mail the Advocate at the nonprofit postage rate. Therefore, we are listing the generic AMS Member Benefits and a general toll-free number you can call to get more specific information about the benefits. For information about any of these programs, call our Customer Service Representatives, Toll-Free at 1 (800) TRICARE/CHAMPUS Supplement Plan: Acceptance guaranteed for comprehensive benefits that not only pay your DRG cost-shares, but also pay 100% of your out-of-pocket share of eligible excess expenses. Benefits include a unique premium-paying Survivors Benefit and deep discounts on all your dental, vision, and hearing care. Medicare Supplement Plans: Your choice of coverages when you are eligible for Medicare. Benefits increase automatically with any increase in federal deductibles. Cancer Protector Plan: Guaranteed acceptance, regardless of age, for Members who have lived 10 years or more cancer-free. Dental Insurance Program: Low cost comprehensive coverage that allows you to use your own dentist while covering preventive care and more than 150 treatments and procedures. Insurance Information 1 (800) TRICARE Supplement Plan Medicare Supplement Plan Cancer, Dental Auto/Homeowner s 1 (800) Client #3825 Auto Rentals 1 (800) We have three nationwide car rental firms. Call for the AMS ID number and the toll-free number for the firm of your choice. Credit Card 1 (800) Hotel/Motel Discounts 1 (800) There are four major, nationwide chains that offer substantial discounts for AMS members. Call the above number for information on which hotels/motels participate with us and for your ID number and reservation phone number. Other Benefits 1 (800) Legal Access Plan

8 American Military Society P.O. Box Washington, D.C Add ress Service Requested Non-Profit Org. US Postage PAID Washington, DC Permit No An Important message about TRICARE and Medicare page 1 Veterans Affairs Directive Gives Priority to Disabled Vets page 1 Chairman Calls Guard and Reserves a National Treasure page 2 National Cemeteries page 2 P resident s Column page 3 Legislative Update page 4 Reunion Announcement page 5 New Ways to Help Troops in Iraq and Afghanistan page 5 IOM Creates Web Site for Veterans page 6