Will GOP Back Benefit Cuts on Military Retirees?
The teachers must be wishing they wore uniforms.
Governors across the country are reacting to deficits by cutting - or trying to cut - the generosity of public employee healthcare benefits.
Now similar cutbacks are being proposed at the federal level for beneficiaries of the most generous public benefits program of them all: military retirees.
It will be interesting to see whether a Republican Congress allows a Democratic administration to proceed.
From the Washington Post this morning:
Among government workers, one group enjoys lifetime health benefits virtually unmatched in the United States: military retirees. ...
The premiums are a fraction of those in the private sector, deductibles are low and co-pays limited. Premiums have not changed in 16 years. But Tricare’s costs are exploding, projected in five years to hit $65 billion to insure 9.6 million people. ...
[Secretary of Defense Robert] Gates has tried to boost Tricare premiums in three Pentagon budgets. He made the case to Congress that spiraling personnel and health-care costs are “crippling” the military, as retirees receiving full pensions decline new health insurance when they go to work for private companies. He has warned that weapons modernization programs and equipment for U.S. troops in Iraq and Afghanistan are in jeopardy.
But Congress rebuffed him each time, temporarily prohibiting the Pentagon from making changes to Tricare fees.
Gates is now back with a far more modest proposal to raise premiums for 586,000 retirees of working age by $2.50 a month for individuals and $5 a month for families. He is supported by the six members of the Joints Chiefs of Staff, who wrote an unusual plea to Congress in February urging passage of the plan.
Opponents, however, are giving little ground.
Can we cite this as Exhibit 327 of how crazy it was that conservatives and Republicans ended up in 2009 as the defenders of limitless healthcare spending for retirees?
Rising retiree health costs are devouring defense operations. They are driving the deficit. They will in time force tax increases. If you wish to maintain a vigorous national defense, balance the budget and hold the line on taxes, you must control healthcare costs.
And government healthcare costs cannot be controlled independent of trends in private healthcare costs. Peter Orszag was right about that.
In the end, the Gates approach to cost-control (like the approach being taken by governors with their public employee unions) will take us only so far.
Requiring employees to contribute more as costs rise will not prevent the costs from rising in the first place.
To slow the rise altogether, we'll need to find more fundamental changes. Conservatives need to rejoin that discussion, not opportunistically seize the chance to score political points by aligning themselves against difficult reforms.
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