Impact of Proposed Healthcare Budget Prepared for AMSUSSM

1
Impact of Proposed Healthcare BudgetPrepared
for AMSUS-SM
Jim Young February 15, 2006
2
Agenda

• MOAA Mission and What We Do
• Key Wins Over the Past Few Years and Key Goals
  for 2006
• Impact of Proposed Healthcare Budget
• What Can You Do?

3
Mission

• Be most effective in shaping relevant government
  policy
• Be your most responsive and valuable information
  source
• Promote enduring values
• Provide high-quality products and services

4
What We Do

• Plan and Propose Legislation
• Research Analyze Issues
• Report to the Board Inform Membership
• Plan Conduct Issue Campaigns
• Testify Before Congress
• Urge Grassroots Action
• Lead Coalition Action

5
The Military Coalition

• Air Force Association (AFA)Air Force Sergeants
  Association (AFSA)Air Force Women Officers
  Associated (AFWOA)American Logistics Association
  (ALA)AMVETS (American Veterans)Army Aviation
  Association of America (AAAA)Association of
  Military Surgeons of the United States
  (AMSUS)Association of the United States Army
  (AUSA)Chief Warrant Officer and Warrant Officer
  Association, (CWOWOA) of the United States Coast
  Guard
• Commissioned Officers Association (COA) of the
  UnitedStates Public Health Service, Inc.Enlisted
  Association of the National Guard of the United
  States (EANGUS)Fleet Reserve Association
  (FRA)Gold Star Wives of America (GSW)Jewish War
  Veterans of the United States of America
  (JWV)Marine Corps League (MCL)Marine Corps
  Reserve Association (MCRA)Military Chaplains
  Association of the United States of America
  (MCA)Military Officers Association of
  America(MOAA)

6
The Military Coalition

• Military Order of the Purple Heart National
  Association for Uniformed Services
  (NAUS)National Guard Association of the United
  States (NGAUS)National Military Family
  Association (NMFA)National Order of Battlefield
  Commissions (NOBC)Naval Enlisted Reserve
  Association (NERA)Naval Reserve Association
  (NRA)Navy League of the United States (NLUS)Non
  Commissioned Officers Association (NCOA)Reserve
  Enlisted Association (REA)Reserve Officers
  Association (ROA)The Retired Enlisted
  Association(TREA)Society of Medical Consultants
  to the Armed Forces (SMCAF)United Armed Forces
  Association (UAFA)United States Army Warrant
  Officers Association (USAWOA)USCG Chief Petty
  Officers Association (CPOA)Veterans of Foreign
  Wars (VFW)Veterans' Widows International Network
  (VWIN)

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Veterans Service Organizations

• African American Post Traumatic Stress Disorder
• Air Force Sergeants Association
• American Defenders of Bataan and Corregidor
• American Ex-Prisoners of War
• American GI Forum of the United States
• American Gold Star Mothers, Inc.
• American Legion
• American Red Cross
• American War Mothers
• AMVETS
• Armed Forces Services Corporation
• Army and Navy Union, USA, Inc.
• Blinded Veterans Association
• Blue Star Mothers of America, Inc.
• Catholic War Veterans, USA, Inc.
• Congressional Medal of Honor Society of the
  United States of America
• Disabled American Veterans
• Fleet Reserve Association
• Gold Star Wives of America, Inc.

8
Veterans Service Organizations

• Military Order of the Purple Heart of the U.S.A.,
  Inc.
• Military Order of the World Wars
• National Amputation Foundation, Inc.
• National Association for Black Veterans, Inc.
• National Association of County Veterans Service
  Officers, Inc.
• National Association of State Directors of
  Veterans Affairs (NASDVA)
• National Veterans Legal Services Program
• Navy Club of the United States of America
• Navy Mutual Aid Association
• Non Commissioned Officers Association
• Paralyzed Veterans of America
• Pearl Harbor Survivors Association, Inc.
• Polish Legion of American Veterans, USA
• Swords to Plowshares Veterans Rights
  Organization
• The Retired Enlisted Association
• United Spinal Association
• US Submarine Veterans of World War II
• Veterans Assistance Foundation, Inc.
• Veterans of Foreign Wars of the United States

9
Key Wins in Recent Past

• 37 cumulative pay raise (vs. 27 ECI)
• Tax relief for Reserves, mil homeowners
• 46 GI Bill increase
• Major death benefits increases (SGLI, SBP)
• Health coverage for drilling G/R
• TRICARE for Life
• Higher pay to severely/combat disabled retiree

10
Key Goals for 2006

• Prevent cost-shifting/Improve TRICARE
• Fix remaining SBP inequities
• Increase end strength to match mission
• Improve Guard/Reserve health coverage
• Better care for returning wounded/families

11
Impact of Proposed 39 Billion Health Care Budget
on Retirees

• Higher enrollment fees for Prime
• Higher deductibles for Standard
• New enrollment fee for Standard
• Higher costs for everyone using TRICARE Retail
  Pharmacy, except AD

12
Proposed TRICARE Prime Enrollment Fees (October
1, 2006)

• Currently 230 individual 460 family
• Retired enlisted, E-6 and below
• 275 for individual 550 for family
• Retired enlisted E-7 and above
• 350 for individual 700 for family
• Retired officers
• 500 for individual 1000 for family
• Department has the authority to do this

13
Proposed Higher Deductibles for TRICARE Standard
(October 1, 2006)

• Currently 150 individual 300 family
• Retired enlisted (all grades) would pay
• 175 for individual 350 for family
• Retired officers (all grades) would pay
• 225 for individual 450 for family
• Department needs Congressional approval

14
Proposed New TRICARE Standard Enrollment Fee
(October 1, 2006)

• Currently 0 individual 0 family
• Retired enlisted, E-6 and below
• 75 for individual 150 for family
• Retired enlisted E-7 and above
• 100 for individual 200 for family
• Retired officers
• 150 for individual 300 for family
• Department needs Congressional approval

15
Future Proposed Cost Increases

• Enrollment Fee and Deductible Changes to have a
  two-year phase-in
• Prime and Standard Enrollment Fees adjusted
  (indexed) using FEHBP rates of inflation
  beginning in October, 2008

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Why DoD Wants To Do This

• Sustain the Benefit
• Rein in healthcare costs
• Return cost shares to that of 1996
• Was 73 DoD and 27 Beneficiary
• Now 88 DoD and 12 Beneficiary
• Proposal increases beneficiary cost share to
  high teens

17
TRICARE Eligible BeneficiariesMonthly Average,
FY05
Other 1
Retirees Family Members 65
Active Duty
1.8M
1.8M
19
19
2.3M
3.3M
25
Retirees Family Members 36
Active Duty Family Members
Source M2
18
TRICARE Prime Enrollment Fees
19
DoD Pharmacy WorkloadRaw Number of Rxs Filled
20
Unique Users for Prescriptions Point of
ServiceAll Ages, FY05
Source PDTS
21
Unique Users for Prescriptions Point of
ServiceBy Age, FY04
Unique Users 65 1.3M
Unique Users MTF
Mail Order
Mail Order
3
MTF
14
61
1
1
5
1
1
33
19
25
15
21
Retail
Retail
Source PDTS
22
MHS Pharmacy Benefit UsersBy POS, Jul 01 Sep 05
Source PDTS
23
DoD Drug Expenditures thru FY 2005
Millions
6,000
5,000
629
546
4,000
429
Mail
3,000
3,161
Retail
2,430
347
TRICARE Sr. Rx Implementation 1 Apr 2001
1,848
MTF
191
2,000
1,279
106
681
83
35
455
342
1,000
283
245
1,703
1,615
1,566
193
1,388
181
1,170
1,034
878
741
797
662
617
0
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
Percent increase over prior year
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
MTF costs do not Include dispensing costs
TRRx and TMOP are net cost to government
Source PDTS
24
AFMS TransformationHistorical Air Force Bed
Status
Fewer beds in AFMS today than Wilford Hall
Medical Center alone in 1990.
Source EASIV Repository (1997-2004, 2005
est) Listing of USAF Fixed MTFs (1979-1996)
25
MTFs and Manpower Over Time
(-36)
Hospitals
(-11)
NOTE Manpower data does not reflect BRAC impact
26
Prescription Cost Analysis Point of
ServiceAverages for 90-day supply of Brand Name
Drugs
Source PDTS, 1 Oct 04 30 Jun 05, Top 50 TRRx
NDCs
27
Is Oversight Only on Healthcare?

• Lockheed's C130J transport aircraft has more than
  doubled in price in less than a decade

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What Can You Do?

• Join/Support Associations you identify with and
  that represent your interests
• Be engaged
• Communicate with your legislators
• If eligible, fill your prescriptions through TMOP

29
People listen to us because

• We listen to our members!

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Together, we have

• One Powerful Voice.

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Questions ?
32
Jim Young, RPh, Colonel, BSC, USAF-Ret Deputy
Director, Government Relations Military Officers
Association of America (MOAA) 201 N. Washington
Street, Alexandria, VA 22314 [phone] or
[phone], Ext 141 [phone] FAX
jimy_at_moaa.org