Order Code 98-1006 F
CRS Report for Congress
Received through the CRS Web
Military Health Care:
The Issue of “Promised” Benefits
Updated July 10, 2001
David F. Burrelli
Specialist in National Defense
Foreign Affairs, Defense, and Trade Division
Congressional Research Service ˜ The Library of Congress
Military Health Care:
The Issue of “Promised” Benefits
Summary
Many military health care beneficiaries, particularly military retirees, their
dependents, and those representing their interests, state that they were promised “free
health care for life at military facilities” as part of their “contractual agreement” when
they entered the armed forces. Efforts to locate authoritative documentation of such
promises have not been successful. Congressional report language and at least three
recent court cases have rejected retiree claims seeking ‘free care at military facilities’
as a right or entitlement. These have held that the current medical benefit structure
made up of military health care facilities, Tricare and Medicare provide lifetime health
care to military members, retirees and their respective dependents. Nevertheless,
claims continue to be made, particularly by those seeking additional benefits from the
Department of Defense, or attempting to prevent an actual or perceived reduction in
benefits.
Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
“The Promise” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Recent Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Military Health Care:
The Issue of “Promised” Benefits
Introduction
In recent years, numerous efforts have been made to increase, or prevent any
decrease, of health care benefits and options available to military retirees. Many
military retirees and others seeking these increases, or attempting to prevent any
decrease in their benefits, often justify their claims based on assertions that the
medical care promised to them is no longer available.1 These retirees say that the
relatively large military medical infrastructure that existed during the cold war
provided greater access for retirees. They note that as a result of the reduction of the
size of the Department of Defense (DoD), fewer medical facilities are available.2 In
certain instances, organizations representing military retirees have alluded to “broken
promises.” Some individuals have claimed that these benefits include “free” health
care for life, or more liberally, “free care for life in military health care facilities.”
Such contentions are not supported by a review of the legislative history of the
statutory language related to military health care for retirees and dependents. Nor,
with the possible exception of a very few of the literally thousands of different pieces
of recruiting literature distributed to prospective recruits and current military
members, are these claims supported by written documentation. More recently, a
number of bills have been introduced seeking to expand military health care options.
In the 106th Congress, at least four of these (H.R. 2966, H.R. 3573, S. 2003 and S.
2013) cite a “promise” or “commitment” as the rationale for provisions that would
“restore health care coverage to retired members of the uniformed services.”3
Although none of these became law, Congress substantially expanded the military
1“About 365,000 elderly retirees and dependents-a thousand a day-will be seen by military
doctors this year, Defense Department officials say.” Adde, Nick, Medical care access not
difficult for all, Army Times, February 23, 1998: 22.
2Burrelli, David F., and Elizabeth A. Dunstan, Military Retiree Health Care: Base Closures
and Realignments, CRS Report 95-435 F, March 28, 1995.
3H.R. 2966, Rep. Shows, October 5, 1999; H.R. 3573, Rep. Shows, February 2, 2000; S.
2003, Sen. Johnson, January 24, 2000; and, S. 2013, Sen. McCain, January 27, 2000. These
bills are discussed later in this report. Other legislation seeking to expand military health care
benefits include: S. 1335, Sen. Ashcroft, July 1, 1999; H.R. 955, Rep. Collins, March 29,
1999; H.R. 1413, April 14, 1999; H.R. 1547, Rep. Thornberry, April 22, 1999; H.R. 1067,
Rep. Thornberry, March 3, 1999; S. 915, Sen. Gramm, April 29, 1999; and, S. 350, Sen.
Hutchison, February 3, 1999.
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retiree health care benefits via the FY2001 National Defense Authorization Act.4
H.R. 179 was introduced on January 3, 2001 seeking to “restore health care coverage
to military retirees.” In introducing this legislation, Rep. Shows noted that “we
should keep our promise to America’s Military retirees.”5 Interestingly, the legislation
would “restore” a “promised” benefit by allowing military retirees to participate, for
the first time, in the health care plan available to federal civilian employees: the
Federal Employees Health Benefits program (FEHBP).
Background
Under current law, active duty personnel are entitled to military health care and
have a right or claim to this care. Active duty dependents are also entitled to this
care, however, this entitlement is limited to space or service availability restrictions.
Such an entitlement obligates the military to provide this care (subject to any stated
restrictions such as space-availability for active duty dependents). As enforced by the
Department of Defense, and interpreted by the courts, retirees and their dependents,
while eligible for care on a space- or service-available basis, have no entitlement in
statute to such care. In other words, they have no right to military health care and the
military services have total discretion in when and under what circumstances retirees
and their dependents will get care in military treatment facilities or MTFs. Those
dependents and retirees (under age 65) who are unable to get care at MTFs can seek
care via civilian providers under DoD’s Tricare benefit plan.
Tricare is the name of the health benefit plan for all military beneficiaries.
Tricare is composed of three types of coverage: Prime, Extra and Standard. Tricare
Prime is comparable to a Health Maintenance Organization (HMO) using the MTF
as the base of health care services. Tricare Extra is similar to a Preferred Provider
Organization or PPO. Finally, Tricare Standard is a fee-for-service plan (formerly
known as the Civilian Health and Medical Program of the Uniformed Services,
(CHAMPUS6)). Active duty personnel and their dependents are automatically
enrolled in Tricare Prime. Retirees (under age 65) and their dependents must enroll
in Tricare Prime or seek care via Tricare Extra or Standard. At age 65, retirees lose
eligibility for Tricare and become eligible for Medicare benefits. Thus, military service
provides lifetime care from a number of government-sponsored or reimbursable
sources.7
4P.L. 106-398, Oct. 30, 2000.
5Congressional Record, January 3, 2001: H23.
6P.L. 89-614, 80 Stat. 862, September 30, 1966.
7This general benefit structure is not new, nor has its consideration by Congress been a recent
phenomenon. For example, see U.S. Congress. House. Committee on Armed Services,
CHAMPUS and Military Health Care, Subcommittee 2, Hearings, 93rd Cong., 2nd Sess.,
HASC No. 93-70, October 8, 1974. Interestingly, claims of “free health care for life” did not
surface in these hearings.
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With the passage of the FY2001 National Defense Authorization Act, beginning
in October 2001, eligible military retirees over age 64 will be allowed to participate
in Tricare provided that they are enrolled in Medicare Part B.
“The Promise”
The creation of health care benefits and the rules and regulations pertaining to
these benefit are matters for Congress. Under the Constitution, Congress has the
authority
To make Rules for the Government and Regulation of the land and naval
Forces.8
Without explicit authorization from Congress, such benefits can not be created nor
conferred by the military or others. A search of the relevant literature shows that at
no time did Congress authorize rules and regulations providing “free health care for
life at military facilities” for military retirees. Some have asserted that prior to 1956,
the lack of legal language to the contrary allowed the military to be contractually
obliged to provide “promised” care. However, under our system of government, the
military does not have the constitutional authority to create such a contractual
obligation. The courts (as discussed below on pages 5, 6, and 7) have held that only
Congress has such authority under the Constitution.
The history of military health care shows that care provided to active duty
members was originally paid for by the members as far back as 1799.9 In that year,
Congress enacted legislation for the military establishment to care for the “regimental
sick” as well as an act for the “relief of sick and disabled seamen.”10 Later changes
provided permissive care to dependents and, later still, to retirees and their
dependents. However, at no time were military retirees provided an entitlement to
care. In 1956, Congress put the permissive nature of this benefit into law:
... a member or former member of a uniformed service who is entitled to
retired or retainer pay, or equivalent pay may, upon request, be given medical
and dental care in any facility of any uniformed service, subject to the
availability of space and facilities and the capabilities of the medical and
dental staff.11 [Emphasis added.]
In 1966, Congress created Medicare which was designed to provide health care
for people over age 65 as well as certain disabled individuals. A problem arose in that
military personnel tended to retire at a relatively younger age (in most cases, early-
to mid-40s) and could be without guaranteed access to health care until age 65. In
8U.S. Constitution, Art. 1, Sec. 8, cl. 14.
9U.S. Congress. House. Committee on Armed Services, Subcommittee No. 2, CHAMPUS and
Military Health Care, 93d Cong., 2d Sess., December 20, 1974: 6.
101 Stat. 721 and 1 Stat. 729, March 2, 1799, respectively.
1110 United States Code, sec. 1074(b).
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other words, these retirees were not entitled to military health care and were too
young to participate in Medicare. In an effort to address this inability to gain access,
as well as provide for those active duty dependents who could not gain access to
military medical facilities, Congress created the Civilian Health and Medical Program
of the Uniformed Services (CHAMPUS). Modeled after the Blue Cross/Blue Shield
high option, CHAMPUS was a fee-for-service benefit. Although it required no
premiums, CHAMPUS did require cost sharing on the part of the beneficiary. Thus,
CHAMPUS was not free, nor did it relate to care from MTFs. (As noted above,
CHAMPUS later became part of Tricare.)
Numerous claims have been made concerning “promises” to military personnel
and retirees with regard to health care benefits. Many appear to believe that they
were “promised free health care for life at military facilities.” Efforts to locate written
authoritative documentation of such “promises” have not been successful. However,
some military recruiting literature does make general statements about health care.
As an example, a recruiting brochure cited by The Retired Officers Association states:
Health care is provided to you and your family members while you are in
the Army, and for the rest of your life if you serve a minimum of 20 years
of Federal service to earn your retirement.12
This language, of course, does not mention “free” health care. Nor does it mention
that such care is to be provided via the military health services system and/or in
military facilities. This advertised statement is correct in that military retirees do
receive their promised lifetime benefits via MTFs (including space- or service-
available care in retirement), Tricare and Medicare—all earned as a result of their
federal military service.
The same source quotes a 1991 CRS report as stating that “the ‘free health care
for life’ promise was functionally true and had been used to good advantage for
recruiting and retention.”13 The report is much more nuanced, and developed the
analysis more deeply than this.14 It noted that the 1956 legislation did not authorize
a legal entitlement for care to be provided to retirees and their dependents, but that
the retiree and dependent population, in proportion to the available space in military
health care facilities, was so low that as a practical matter, such care was usually
available. It also observed that this de facto availability was, without question, a
useful tool for recruiters. The end result appears to be that, regardless of the lack of
statutory entitlement, many active duty personnel and their dependents, and retirees
and their dependents, erroneously came to believe that they were guaranteed free
health care in military facilities for life.
12Army brochure cited and reproduced in The Retired Officers Association Magazine, April
1996.
13The Retired Officers Association, April 1996. This CRS report was also similarly
represented in Roberts, C.R., Veterans Call It The Big Lie, The American Legion, October
1995: 18. The article is based on exerts from The News Tribune, Tacoma, WA, by the same
author.
14Best, Dick, Memo to Congress, Promises of Lifetime Medical Care, April 21, 1997.
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Other sources have noted that such promises, whether or not actually made, are
groundless. For example, in responding to questions from Congress concerning what
benefits were promised, Rear Admiral Harold M. Koenig, Deputy Assistant Secretary
of Defense for Health Affairs, sought to clarify a statement made by Vice Admiral
Hagen concerning these benefits. Rear Admiral Koenig stated in 1993 that:
There is a problem here of interpretation. [Vice Admiral Donald Hagen,
Medical Corps Surgeon General, U.S. Navy] said medical care for life.
That is true. We have a medical care program for the life of our
beneficiaries, and it is pretty well defined in the law. That easily gets
interpreted to, or reinterpreted into, free medical care for the rest of your
life. That is a pretty easy transition for people to make in their thinking,
and it is pervasive. We spend an incredible amount of effort trying to
reeducate people that that is not their benefit.15
According to the Department of Defense, “[a]s thus formulated, medical care for
retirees in military medical facilities has always been, and to this day remains, a
privilege, not an absolute right, as has been assumed by many.”16
The federal courts have repeatedly held that such claims of a “promise” have no
legal standing. In late 1997, a U.S. District Court dismissed a lawsuit by retirees
against the U.S. seeking “free health care” from the military. According to the court:
The court must reject plaintiffs’ contention that [10 United States
Code sec. 1074(b)] confers authority on the military branches to guarantee
free lifetime medical care to retirees and their dependents. First, plaintiffs
cite to no regulation under sec. 1074(b) guaranteeing such care, but only
cite to recruiting materials that make general representations as to eligibility
for continued health care for retirees and their dependents. Even if the
military departments had promulgated regulations under sec.1074(b) that
make an unequivocal promise of lifetime medical care for retirees and their
dependents, the language of sec. 1074(b) itself is clearly conditional. Any
regulations purporting to guarantee free and unconditional lifetime health
care to retirees and their dependents would be inconsistent with the statute
and therefore invalid. Larionoff, 431 U.S. at 873 n.13 (“A regulation
which ... operates to create a rule out of harmony with the statute ... is a
mere nullity.”) (citing Manhatten General Equip. Co. V. Commissioner,
297 U.S. 129, 134 (1936)).
Furthermore, under sec. 1074(b), “a retired member of a uniformed
service is not entitled to medical care as a matter of right,” Lord v. United
States, 2 Cl. Ct. 749, 756 (1983), and “retired personnel who fail to receive
such care cannot successfully maintain an action for money damages based
on such failure.” Id. At 757; see also Watt v. United States, 246 F. Supp.
15U.S. Congress. House. Committee on Armed Services, National Defense Authorization Act
for Fiscal Year 1994, H.R. 2401, Hearings, 103rd Cong., 1st Sess., H.Rept. 103-13, April 27,
28, May 10, 11, and 13, 1993: 505.
16U.S. Department of Defense, Office of the Secretary of Defense, Military Compensation
Background Papers, Fifth Edition, September 1996: 609.
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386, 388 (E.D.N.Y. 1965 ) (“furnishing [medical care in a military facility]
to a retired soldier is discretionary, not mandatory”). Because the law
states that retirees are not entitled to health care as a matter of right, the
representations upon which plaintiffs rely are to no effect.17
With respect to the contention that recruiters and others allegedly made
“promises of free care for life,” and that such “promises” must be honored by the
government, the court notes:
Federal officials who by act or word generate expectations in the people
they employ, and then disappoint them, do not ipso facto create a contract
liability running from the Federal Government to the employee ....18
In a separate case (Schism and Reinlie v. U.S.), another federal judge found
military “retirees 65 and older do not have a binding contract with the Pentagon that
guarantees them free health care for life at military hospitals.”19
More recently, a federal appeals court stated:
Nothing in these regulations provided for unconditional lifetime free medical care
or authorized recruiters to promise such care as an inducement to joining or
continuing in the armed forces. While the Retirees argue that the above mentioned
section 4132.1 gave those of them who served as officers in the Navy and Marine
Corps the right to free unconditional medical care, we cannot agree. The [1922
Manual of the Medical Department of the United States Navy] Manual provided
guidelines for the Navy’s Medical Department, but did not create any right in such
officers to the free unconditional lifetime medical care they claim. It related only
to hospital care, not the broader services that these Retirees seek, and covered only
the period when it was in effect. In any event, in view of the general pattern of the
military regulations that provides medical care to retirees only when facilities and
personnel were available, we decline to read into the creation of such an enduring
and broad right to unconditional free lifetime medical care.
In sum, we conclude that the Retirees have not shown that they have a right to the
health care they say was “taken” by the government. Since the basic premise of their
claim fails, their taking claim necessarily also fails.20
17Coalition of Retired Military Veterans, et al. V. United States of America, U.S. Dist. of
South Carolina, C.A.#2:96-3822-23, Dec. 10, 1997: 11-12.
18Coalition v. U.S.: 15-16.
19Adde, Nick, Judge: lifetime care is no guarantee, Army Times, Sept. 21, 1998: 10. An appeal
in this case is anticipated. Schism and Reinlie v. U.S. No. #:96cv349/RV United States
District Court, N.D. Florida, June 10, 1997.
20Sebastain v. United States, 185 F.3d 1368, 1372 (Fed. Cir. 1999). An appeal of this
decision is pending.
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On December 8, 1999, the Coalition of Retired Military Veterans appealed their
case to the Supreme Court.21
On February 8, 2001, the U.S. Court of Appeals for the Federal Circuit reversed
the lower court ruling (Schism and Reinlie v. U.S.) declaring “... the government
breached its implied-in-fact contract with retirees when it failed to provide them with
health care benefits.”22 The appeals court reversed the district court decision and
remanded the case for a determination of damages. Despite various claims, this
finding applied only to the two named plaintiffs (and not to all military retirees), and
no determination of damages was made. (Some have erroneously reported that the
ruling “would have required the government to pay to three million retirees, widows
and dependents up to $10,000 apiece.”23) On June 13, 2001, the Appeals Court
vacated the judgment, withdrew its opinion, and agreed to rehear the appeal en banc.
As stated “[t]he court has determined to rehear this case en banc to resolve the
question of whether the promises of free lifetime care made to and accepted by
Plaintiffs-Appellants should be afforded binding effect.”24
The claim of “free” or “promised” care is often reported in the media or by
lobbying groups. Some media sources have contradicted the notion of free health
care for life.25 Conversely, others appear to accept or support the existence of such
“promises.” Although these sources have no legal authority to effect such claims,
their repetition of these so-called promises may serve to create or reinforce the notion
of the existence of such “promises.”26
Notably, certain former recruiters claim to have made such promises. They may
well have. Nevertheless, as pointed out above, unauthorized promises based on
mistakes, fraud, etc., do not constitute a contractual obligation on the part of the
government/taxpayer.
21Adde, Nick, Retirees head to Supreme Court, The Times, January 10, 2000: 14.
22Schism and Reinlie v. U.S., 2001 U.S. App., 239 F.3d 1280, Feb. 8, 2001.
23Armed Forces News, [http://www.armedforcesnews.com/backissues/2001/062201.htm] June
22, 2001.
24Schism and Reinlie v. U.S. 2001 WL 664440 (Fed. Cir. (Fla)), June 13, 2001.
25Hamby, James E., Jr., ‘Free care for life is a myth,’ Air Force Times, September 20, 1993:
18.
26See, for example, Rich, Spencer, Military Health Care Downsizing Leaves Retirees in a
Bind, Washington, Post, July 30, 1996: A11; Editorials, Veterans should not be force to pay
for ‘free’ health care, Kerrville Daily Times, December 8, 1997: 4A; “ ... the promise of free
health care in their later years was a major enticement to stay for a full career.”, AFSA Calls
for Tricare Reform, Sergeants, November 1995: 9; Kaczor, Bill, AP, Miami Herald, Military
Retirees Appealing Benefits Denial, December 12, 1998: “At the heart of the matter is a 1956
law that permits free care for retirees at military hospitals and clinics but only on a space[-
]available basis.” and, Joyce, Terry, Network Offers Health Care Answers For Military
Families, Charleston Post and Courier, January 9, 2000, “Folks who are upset about care
that’s no longer available or cash outlays for what was supposed to be free.”
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In a different vein, others suggest that although no such legal entitlement exists,
a moral obligation or an obligation based on popular opinion is sufficiently
compelling to make such a promise a reality. For example, Hon. Stephen Joseph,
former Assistant Secretary of Defense (Health Affairs) stated before a congressional
subcommittee in 1995:
The lawyers will tell you that there is no fine print that says free medical
care guaranteed for life. I think though it is facetious for anybody to sit up
here and say that, that is not what recruits believe when they are talked to
by their recruiter. That is a fact of life.27
Whether there is or should be a moral obligation is a matter of opinion; as decided by
the courts and enforced by the administrators, these claims, like the others, do not
create a contractual obligation on the part of the government/taxpayer. The courts,
and other analysts, have noted that allowing these claims to create such an obligation
would thwart the constitutional role of Congress (i.e., prevent the Congress from
determining the compensation and benefits of the armed forces) and create a situation
wherein military personnel/retirees (and potentially all other federal employees) could
create or expand their own benefits with popular myth or rumor and without review.
Despite extensive documentation, including court decisions, to the contrary, the
belief in legally guaranteed “free lifetime care” persists,28 and such claims continue
color debate over the availability of these and other military health care benefits.29
Recent Legislation
Though Congress has never authorized “free health care for life at military
facilities,” various congressional reports have commented on the issue, and there have
been recent legislative actions on the subject. For example, the Senate, explaining its
support of additional benefits for military retirees, included non-binding language in
its report on the fiscal year 1998 National Defense Authorization Act that reiterated
its intention with regard to the promise of lifetime care:
A longstanding priority of the committee has been the improvement
of the military health care system ....
27U.S. Congress. House. National Security Committee, Military Personnel Subcommittee,
Hearings, Oversight of Previously Authorized Programs, 104th Cong., 1st Sess., H.Rept 104-7,
March 28, 1995: 828. The Retired Officer Association also credits Dr. Joseph with testifying
(in 1995) “before Congress that DoD has an ‘implied moral commitment’ to provide health
care to all eligible beneficiaries.”
28See U.S. Congress. House. National Security Committee, Military Personnel Subcommittee,
Hearings on National Defense Authorization Act for Fiscal Year 1998-H.R. 1119 and
Oversight of Previously Authorized Programs. HNSC No. 105-6, 105th Cong., 1st Sess., Feb.
27, 1997: 1-162, for a lengthy treatment of this issue.
29For example, an insert in The Retired Officer Magazine, January 1998, seeking FEHBP
benefits for military retirees over 65, is entitled, “FEHBP-65: The fix for broken health care
promise.”
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[T]he committee is concerned that the Department of Defense (DOD)
faces significant constraints on its ability to meet the entire range of benefits
expected by participants in the Military Health Service System ....
The issue of health care for military retirees over age 65 is of special
concern to the committee. The nation has incurred a moral obligation to
attempt to provide care to military retirees who believe they were promised
lifetime health care in exchange for a lifetime of military service. The nation
fulfills its obligation through Medicare.30
Here, the Senate is clearly expressing its view that a “promise” to military retirees was
made—and that existing statutes and institutions do fulfill that promise.
Later, with the enactment of the FY1998 National Defense Authorization Act,
Congress included the following language:
SEC. 752. SENSE OF CONGRESS REGARDING QUALITY HEALTH
CARE FOR RETIREES
(a) Findings.-Congress makes the follow findings:
(1) Many retired military personnel believe that they were promised lifetime
heath care in exchange for 20 or more years of service.
(2) Military retirees are the only Federal Government personnel who have
been prevented from using their employer-provided health care at or after 65
years of age.
(3) Military health care has become increasingly difficult to obtain for
military retirees as the Department of Defense reduces its health care
infrastructure.
(4) Military retirees deserve to have a health care program that is at least
comparable with that of retirees from civilian employment by the Federal
Government.
(5) The availability of quality, lifetime health care is a critical recruiting
incentive for the Armed Forces.
(6) Quality health care is a critical aspect of the quality of life of the men
and women serving in the Armed Forces.
(B) SENSE OF THE CONGRESS.- It is the sense of the Congress that-
(1) the United States has incurred a moral obligation to provide health care
to members and former members of the Armed Forces who are entitled to retired
or retainer pay (or its equivalent);
(2) it is, therefore, necessary to provide quality, affordable health care to
such retirees; and,
(3) Congress and the President should take steps to address the problems
associated with the availability of health care for such retirees within two years
after the date of the enactment of this Act.31
30U.S. Congress. Senate. Committee on Armed Services, National Defense Authorization Act
for Fiscal Year 1998, 105th Cong., 1st Sess., S.Rept. 105-29, S. 924, June 17, 1997: 294-5.
31P.L. 105-85, sec. 752, November 18, 1997.
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Although this language is also non-binding, it does give a sense of the rationale behind
creating additional benefits for retirees.32
Some in Congress would like to go further in clarifying the issue. On August 6,
1998, Rep. Jo Ann Emerson (R., MO), introduced legislation that would have
established a “Medicare eligible military retiree health care consensus task force.”
Among its proposed duties, this task force would conduct “a comprehensive legal and
factual study of ... [p]romises, commitments, or representations made to members of
the Uniformed Service by Department of Defense personnel with respect to health
care coverage of such members and their families after separation from the Uniformed
Services.”33 The twelve-member task force (including representatives of military
retiree organizations) would determine what had been promised to military members
and to what extent these promises were binding. This legislation was reintroduced
in the 107th Congress.34
One reported response to this legislation by an unidentified representative of a
military retiree organization was somewhat muted, suggesting that “... we are really
beyond the point of looking at broken promises. We are at the stage now where
Congress knows something has to be done and is just trying to decide what to do.”35
The legislation was referred to committee but was not reported out of committee
prior to adjournment.
As noted above, H.R. 2966 was introduced on September 28, 1999. (This
legislation was followed by H.R. 3573, S. 2003 and S. 2013 which have very similar,
albeit not identical, provisions.) Among their provisions, H.R. 2966, H.R. 3573, S.
2003, and S. 2013 seek to expand military retiree health care options to include access
to the Federal Employees Health Benefits Program. In offering these benefits, these
bills present a number of “findings” (some of which appear inconsistent with the
official history of military medical care). For example, H.R. 2966, H.R. 3573 and S.
2003 find that:
Statutes enacted in 1956 entitled those who entered service on or after June 7,
1956, and retired after serving a minimum of 20 years or by reason of a service-
connected disability, to medical and dental care in any facility of the uniformed
services, subject to the availability of space and facilities and the capabilities of
the medical and dental staff.
32These additional benefits include the creation of demonstration projects known as Medicare
Subvention and a Federal Employees Health Benefits Program option. In addition, Congress
has instructed DoD to insure an improved pharmaceutical benefit for eligible beneficiaries.
For additional information, see Best, Richard, Military Medical Care: Questions and
Answers, CRS Issue Brief IB93103, updated regularly.
33H.R. 4464, August 6, 1998: 2.
34H.R. 67, January 3, 2001.
35Cited as “a representative of a major military organization” lobbying for improved medical
care for military retirees; see Maze, Rick, A Broken Promise, Navy Times, August 24, 1998:
24.
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In addition to not being consistent with the statute, the Department of Defense has
always maintained that military retiree health care is, and always has been, permissive
in nature and therefore not an entitlement. (See page 5, above.)
As noted above, although none of these bills was enacted, Congress substantially
expanded the health care benefits available to military retirees via the FY2001
National Defense Authorization Act. Among its provisions, this legislation provides
an enhanced pharmacy benefit and, with certain restrictions, it extends Tricare
coverage to those age 65 and older. In an effort to further expand these health care
options, H.R. 179 was introduced in the 107th Congress. This bill, as noted, would
make FEHBP benefits available to eligible military retirees.
Based on the premise that DoD would provide lifetime medical care for retirees
in general (and no cost care to those retirees who entered prior to June 7, 1956), this
bill asserts that the “United States should reestablish adequate health care for all
retired members of the uniformed services that is at least equivalent to other federal
employees by extending to such retired members of the uniformed services the option
of coverage under the Federal Employees Health Benefits program [FEHBP], the
Civilian Health and Medical Program of the uniformed services, or the TRICARE
Program.”
FEHBP provides insurance coverage for federal civil service employees,
annuitants and beneficiaries. “The Office of Personnel Management contracts
annually on a noncompetitive basis with specific fee-for-service plans..., six plans
sponsored by federal employee or postal organizations, and six plans for employees
of certain federal agencies. The program includes over 250 health maintenance
organizations.... In 1999, total annual premiums for self-only policies average $2,590;
family premiums average $5,774. The government’s share of premiums is determined
by a formula set in law, specifically, 72% of the weighted average premium of all
plans, not to exceed 75% of any given plan’s premium. In 1999, the maximum
government contribution for self-only coverage is $1,872, and for family coverage...is
$4,170.”36 Under language in this bill, for those retirees who entered the service
prior to June 7, 1956, the government’s contribution for such care is 100%.
By providing access to FEHBP, coupled with those health care benefits already
afforded military retirees, these bills provide an extensive range of health care benefits
that go beyond existing benefits for civil servant retirees. As such, this bill would
provide benefits that are arguably superior to those available to federal civil servants
especially if they are offered at no cost to the beneficiaries.
Currently, DoD is conducting several demonstration projects which provide
enhanced benefits or options for military retirees and their dependents. These
demonstration projects are scheduled to run for at least two years. Among these is
a demonstration project that provides certain retirees with access to FEHBP benefits.
For more information on these demonstration projects, see Best, Richard, Military
36Merck, Carolyn, The Federal Employees Health Benefits Program, CRS Report RL30336,
Updated October 12, 1999: Summary.
CRS-12
Medical Care Services: Questions and Answers, CRS Issue Brief IB93103, updated
regularly.