Veterans Affairs - Don't Miss !!!
 

Since 01-19-05

From: Waspscpo@aol.com [mailto:Waspscpo@aol.com] 
Sent: Wednesday, January 19, 2005 11:45 AM
To: undisclosed-recipients
Subject: Veterans Affairs - Don't Miss !!!

To calculate disability retirement three years’ active service for a mobilized Guard and Reserve member can mean going back to period of service when basic pay was set far below current pay levels. This can sharply lower the value of disability retirement compared to active duty colleagues. Thus, older, more experienced reservists wounded in Iraq can receive disability pay only half the size of that provided to injured active duty peers.  A change was proposed by Defense officials after realizing the disparity in disability retirement between active duty members and activated reservists injured in Iraq and Afghanistan.  With the 2005 NDAA,

Congress stepped in to require that disability retirements be computed for High-3 Guard or Reserve members as though they had served their last three years on active duty. But the law wasn’t written, officials discovered, so it could be applied retroactively to reserve members injured since the war on terrorism began 11 SEP 01. Knowing that was the intent, Defense lawyers and policymakers reviewed the language carefully over the last two months. They found no way to interpret it more broadly.

In late December, officials issued guidance to military finance centers to apply the more favorable High-3 formula only to disability retirements on or after Oct. 28, when the law was signed. As it now stands National Guard and Reserve personnel injured while on active duty, and awarded disability retirement on or after 28 OCT 04 will have their pay calculated using a more generous formula. Those awarded disability retirement prior to 28 OCT 04 will not.  It’s too early to assure disabled reservists that the new Congress will vote to move the effective date back to 9/11.

But it clearly is out of sync as written with another 2005 NDAA change, this one directing that the more favorable High-3 formula be used to recalculate survivor benefit to families of reservists who died on active after 10 SEP 01. The SBP change helps only a small number of survivors. Most elect to forfeit SBP anyway to accept tax-free Dependency and Indemnity Compensation from the Department of Veterans Affairs. 

It will make a difference to families with small children who have lost reservists on active duty on or after 24 NOV 03. On that date the services, under an earlier law, could begin to elect “child only” SBP, retroactively on behalf of families who have eligible surviving spouse. By doing so, that eligible surviving spouse can receive DIC and the dependent child can draw the SBP. The size of SBP payments, in such cases, increase as a result of the High-3 change. [Source: NAUS Special Update 30 DEC 04]

VA HOME LOAN UPDATE 04:  VA Home loans offer Veterans and Servicemembers low interest mortgages with "No-Downpayment". The Veterans Benefits Act of 2004 signed by the President on 10 DEC 04 made the following significant changes to the Veterans Home Loan Guaranty Program.

•  Increased Maximum Guaranty Amount:  The law changed the maximum guaranty amount of $240,000 to a new limit for a single family residence of $359,650. In addition maximum original loan amounts are now 50 percent higher for first mortgages on properties in Alaska, Hawaii, Guam and the U.S. Virgin Islands.

•  Specially Adapted Housing: The law expanded eligibility to the $50,000 Specially Adapted Housing (SAH) grant to veterans with permanent and total service-connected disabilities due to the loss of, or loss of use, of both upper extremities such as to preclude use of the arms at or above the elbows. In addition the law is amended to specify eligibility where any veteran has suffered an injury, or an aggravation of an injury, as the result of hospitalization, medical or surgical treatment, as if it were service-connected for benefits under Chapter 21, relating to SAH. The VA will be developing detailed application instructions in the near future.

•  Adjustable Rate Mortgages: The law gave the VA authority to guarantee "traditional" Adjustable Rate Mortgages (ARMs) like the Dept. of Housing and Urban Development (HUD) which insures adjustable rate mortgages under the National Housing Act. VA previously had this authority but it expired 30 SEP 95. The legislation provides authority through 30 SEP 08. The Key features of the ARM program are:
1) Interest rate adjustments on an annual basis;
2) Annual interest rate adjustments limited to a maximum increase or decrease of 1 percentage point;
3) Interest rate increases limited to a maximum of 5 percent points over the life of the loan;
4) This type of ARM loan MUST be underwritten at 1 percentage point above the initial rate.

•  Hybrid ARM Loans:  The law extended VA authority to guarantee hybrid ARM loans to 30 SEP 08 and modified the Rate Adjustment Requirements. The provisions of this Act does not affect existing hybrid ARMs. VA hybrid ARM loans made prior to this Act are subject to the terms in effect at the time they were made. For example, a hybrid ARM with an initial fixed rate for five years or more made prior to this Act is limited to a one percentage point initial adjustment and a 5% limit over the life of the loan.  The modified interest rate adjustment requirements incorporated by the new law are:
1) If the initial contract interest rate remains fixed for less than 5 years, the initial adjustment is limited to a maximum increase or decrease of 1 percentage point and the interest rate increase over the life of the loan is limited to 5 percentage points.
2) If the initial contract interest rate remains fixed for 5 years or more, the initial adjustment will be limited to a maximum increase or decrease of 2 percentage points.
3) In cases where the initial interest rate remains fixed for 5 years or more, the interest rate increase over the life of the loan will be limited to 6 percentage points..

•  Funding Fee Exemption: The law expanded the definition of veterans who are entitled to a waiver of the VA funding fee. Veterans who are rated eligible to receive compensation as a result of a pre-discharge disability examination and rating will now be considered as receiving compensation as of that date. This means veterans still on active duty awaiting discharge, but who wish to close on a loan before being released from the military, may be entitled to a waiver of the funding fee.
[Source: Military.com msg dtd 6 JAN 05]

NATIONAL GUARD BONUS INCREASE:  The National Guard Bureau has announced substantial hikes in enlistment and re-enlistment bonuses for fiscal 2005. Enlistment bonuses were raised from $8,000 to $10,000 for individuals without prior service who sign up for one of the Army Guard’s “top 10” military occupational specialties, such as infantry, military police and transportation. In addition prior service members who enlist in the Army Guard for six years will have their bonuses raised from $5,000 to $15,000 and reenlistment/extension bonuses will jump from $5,000 to $15,000.  Guard soldiers are now eligible to receive bonuses through 16 years of service, up from the former cap of 14 years. [Source: Armed Forces News 7 JAN 04]

SBP+DIC:  A legislative goal for 2004-05 of the Gold Star Wives of America, Inc (GSW) is to eliminate the reduction of the Survivor Benefit Program (DoD-SBP) by the Dependency and Indemnity Compensation (VA-DIC).  They are working closely with member organizations of The Military Coalition (TMC) to obtain this goal this year.  The TMC 2005 goals have been compiled and will soon be posted at www.themilitarycoalition.org. About 50,000 military widows are eligible for survivor payments from both DoD and VA.  However, DoD reduces or fully eliminates the SBP payments to eligible widows with the amount of the DIC payment.  Disabled military retirees rated over 50% by the VA have been successful in obtaining phased in or complete reduction of their earned military retired pay by their Disability Compensation through recent legislation.  Although widows are not as great in number they should be allowed the same benefit. Especially since the option to participate was voluntarily elected and PURCHASED by the now deceased disabled retiree. For additional information on how to support this goal contact the GSW Legislative Committee at esmith@capitolcrusader.com.  Current SBP eligibles are:

-- Pre-1993:  Active duty death required 20 years service for SBP eligibility. Retiree death required enrollment in SBP and payment of premiums
-- Post-2001:  Active duty death requirement for years of service eliminated. However, in most cases the SBP was eliminated by the DIC payment.
-- November 2003:  Child option for SBP was added. No child SBP offset was authorized by child DIC payment with resultant increased income to surviving family.
[Source: GSW legislative Committee Msg 1 JAN 05]

VA MEANS TEST THRESHOLDS 2005: The Means Test Thresholds are used to determine a veteran’s eligibility for free VA health care for nonservice connected medical conditions. Current law requires VA to increase the Means Test Threshold amounts by the same COLA percentage made to other VA compensation and pension payments (i.e. 2.7% for 2005).  Public Law 107-135, the Department of Veterans Affairs Health Care Programs Enhancement Act of 2001, directed VA to implement a Geographic-based Means Test (GMT).  VA uses HUD's "low-income" geographic-based income limits as the thresholds for VA's GMT. A veteran's income from the previous year is compared with the appropriate GMT threshold for the previous fiscal year to determine if the veteran should be placed in VA’ health care priority category 7.  HUD's "low income" geographic-based income limits for FY 2004 can be found at: www.huduser.org/datasets/il/il04/index.html. The new rates have been announced with an effective date of 1 JAN 05. The Means Test apples to veterans within one of the three definitions
•    Below the Means Test Threshold is defined as those veterans whose attributable income and net worth are such that they are unable to defray the expenses of care and therefore are not subject to co-payment charges for hospital and outpatient medical services. 
•    Above the Means Test Threshold is defined as those veterans whose attributable income and net worth are such that they are able to defray the expenses of care and must agree to pay a co-payment for hospital care and outpatient medical services.
•    Above the means test and below the GMT threshold is defined as those veterans whose attributable income and net worth are such that they are able to defray the expense of care, but whose inpatient medical care co-payments are reduced 80 percent. Within the VistA system these veterans are identified as "GMT Copay Required."

The 2005 Means Test Thresholds are:
   * Veterans without Dependents: Below $25,842 - Above $25,843.
   * Veterans with One Dependent: Below $31,013 - Above $31,014.
   * Veterans with Two Dependents: Below $32,747 - Above $32,748.
(Note: Dependent threshold amount increases above two dependents are $1,734 per dependent, child income exclusion is $8,200, Medicare deductible is $912, and income and/or asset threshold for net worth development is $80,000)
      Maximum annual Rate of Pension: The base rate without dependents is $10,162 and with one dependent is 13,309. Add $1,734 for each additional dependent. (NOTE: The base pension rate is also used to determine if certain veterans are subject to co-payments for Extended Care Services) [Source: VHA DIRECTIVE 2004-071 dtd 17 DEC 04]

SBP OPEN ENROLLMENT: Retirees can look forward to a one-year SBP Open Season beginning on 1 OCT 05. At that time, retirees not currently participating in the SBP program will be permitted to elect SBP. Retirees participating in the SBP program at a reduced amount will be permitted to increase the base  amount. Lastly, retirees who currently have child only coverage will be permitted to add spouse or former spouse coverage to the existing coverage.  Retirees must live for two years following the election for the coverage to become fully effective. Should the retiree pass away before the period expires, this election shall become void, and all attributed costs will be refunded to the named beneficiary. A buy-in premium will be required for this Open Season election, which will represent costs that would have been paid for this election had it been made at the first opportunity. Interest and any actuarial charges necessary may be added. The cost associated with buy-in premiums are not yet available, but will be posted on www.dfas.mil when they are. [Source: Fort Gordon Retiree E-Notes DEC 04]

MMA 2003 UPDATE 01: The Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) eliminated the Medicare Part B surcharge for uniformed services beneficiaries who were subject to a higher premium (currently paying more than $66.60 a month) for enrolling late in Part B during the years 2001 to 2004.  The beneficiaries will be reimbursed for any surcharges paid in 2004. These refunds will be provided in Social Security retirement checks. Unfortunately, there is no relief for those who started paying the Part B penalty prior to 1 JAN 2001.  Many Uniformed Services Health Care beneficiaries entitled to Medicare Part A, but not enrolled in Part B, were automatically enrolled Sept. 1 without a problem.  However, there have been quite a few retirees who either didn't receive the letter sent out by the Social Security Administration (SSA), or who happened to contact an SSA representative who was not aware of the procedures.  Refer to Bulletin article “Medicare Update 01”.

     Tricare Management Activity official’s note that beneficiaries, unless they specify otherwise, will be enrolled in Part B effective the SSA's operating month, which is currently November.  However, the SSA letter they will receive once enrolled will provide them with the option to change their effective date. Anyone who refuses Part B is ineligible for Tricare for Life benefits. Those selecting an earlier month will have to pay the Medicare premiums for the months selected.  On the surface, that might not sound like a good deal, but for some it could be beneficial if they had medical expenses that could be billed to Medicare. Members of the military retiree community who feel they are eligible to enroll in Medicare Part B during this Special Enrollment Period or who feel they have a reimbursement coming (for 2004) should visit their local Social Security Office or call (800) 772-1213 and explain the situation.  Members of the Air Force retiree community still having a problem should send an E-mail to the Retiree Services Branch in the Air Force Personnel Center. The E-mail address is afpc.retiree@randolph.af.mil .

To ensure the message goes quickly to the right person, put "Medicare Part B Penalty Waiver" in the subject line. The message should include the name and SSN of the beneficiary and sponsor, a telephone number including the area code, whether requesting Part B enrollment OR requesting reimbursement of the Part B penalty for months paid in 2004 OR specifying an earlier enrollment month.  A Retiree Services Branch staff member will consolidate and forward information to the proper officials.  The branch is not staffed to take information by phone.  Those submitting information will be not be contacted unless there is an SEP eligibility or reimbursement problem and that will come from another agency.  The SSA, after processing the enrollment request, will notify the beneficiary by letter. [Source: Air Force Retiree News 2 NOV 04]

MEDICARE UPDATE 01: The Medicare Modernization Act provided a Medicare Part B special enrollment period for uniformed services beneficiaries through 31 DEC 04. The purpose was to ease penalties for previously unenrolled retirees who had to sign up for Part B to get TRICARE For Life (TFL) benefits. Last fall, DoD sent a letter to the 68,000 TFL-eligibles not enrolled in Part B, telling them that they would need to take Part B to keep TRICARE benefits and that Medicare would be sending them a follow-up letter telling them how to enroll. However, about 30,000 of those individuals never received the letter from the Social Security Administration which was mailed in SEP 04 - and due to this system failure have not been enrolled in Part B. Individuals who did not receive a letter from SSA can contact Medicare or SSA to be enrolled immediately. For various reasons, some individuals do not wish to take Part B - because they are still covered by employer-sponsored insurance; because they get care from the VA health system; or because they are active duty family members. However, TRICARE will not pay claims for any Medicare-eligibles who were not enrolled in Part B by 1 JAN. They will regain their TRICARE eligibility (without any late enrollment penalty) if they enroll during 2005. Beneficiaries who have questions concerning the Medicare Modernization Act provisions should call or visit their local Social Security office, call the SSA at 1(800) 772-1213, or visit the SSA Web site at www.ssa.gov/legislation.    

Part B Enrollment: Uniformed services beneficiaries entitled to Medicare Part A based upon age, disability or end-stage renal disease are required by law to enroll in Medicare Part B to retain their TRICARE benefits, unless they have an active duty sponsor. Effective 1 JAN 05 TRICARE will deny payment of health care claims for individuals entitled to Medicare Part A only, because they are not eligible for TRICARE benefits unless they are enrolled in Medicare Part B. Family members of active duty service member are not required to have Medicare Part B to remain eligible for TRICARE benefits. When the active duty service member retires, however, family members with Medicare Part A are required to enroll in Part B to retain TRICARE benefits. Individuals entitled to Medicare Part A and who also have group health plan coverage based on their current employment do not need to enroll in Medicare Part B. These individuals may enroll in Part B while they are employed and covered under the group health plan. They also may enroll in Part B during the 8-month period following the month the employment ends or the group health plan coverage ends, whichever occurs first. Coverage under TRICARE for Life is effective with the Part B entitlement date.

Tricare Claim Denial: TRICARE could deny claims for individuals who recently enrolled or were automatically enrolled in Medicare Part B due to the processing time that is necessary for the enrollment information to cross over from Medicare to TRICARE.  If a TRICARE claim is denied, beneficiaries have two options:  1) They may wait until the enrollment has been reflected in the Department of Defense records and ask their provider to resubmit the claim, or 2) they may take their Medicare card to their local uniformed services personnel ID office for assistance, or contact the Defense Manpower Data Center Support Office (DSO) at 1 (800) 538-9552. Beneficiaries can locate the nearest uniformed services personnel office at www.dmdc.osd.mil.   

Premium Surcharge Waiver: The Medicare Modernization Act also waives the Medicare Part B premium surcharge.  TRICARE beneficiaries who enrolled in Medicare Part B from 1 JAN 01, through 31 DEC 04, and whose Part B premium is more than the 2004 premium of $66.60 per month may have the premium surcharge removed and get a refund of all premium surcharges previously paid in 2004.  They should call or visit their local Social Security office or call the SSA at 1 (800) 772-1213.
[Source: MOAA & NAUS Updates 7 JAN 04]

TRICARE PHARMACY GENERICS POLICY:  Having delayed implementation for 6 months to give beneficiaries and their doctors an opportunity to review generic vs. brand name drug options, TRICARE will implement its long-standing mandatory generic substitution policy in 2005. Beneficiaries who have brand name prescriptions for which there is a generic equivalent need to talk to their doctor about switching to the generic, or getting a "medical necessity" determination if the doctor believes it's important to stick to the brand name drug for valid medical reasons.  To qualify for medical necessity, the doctor must certify one or more of the following conditions:
•    the patient has experienced, or would be likely to experience, significant adverse effects from the generic medicine;
•    the generic medicine has resulted in, or is likely to result in, therapeutic failure, or;
•    the patient has previously responded to the brand name medication, and changing to the generic medication would incur an unacceptable clinical risk.

If the physician feels that it is medically necessary for the patient to continue to receive the brand name version of the medication, the physician should call the TRICARE Retail Pharmacy program Prior Authorization Line at 1 (866) 684-4488 to obtain a letter of medical necessity before the patient presents the next prescription at the retail pharmacy. Unless the patient has an approved letter of medical necessity before they fill the new prescription, they will have to accept the generic substitute or pay the full price of the brand name medication. [Source: eFloridaVets News #131 dtd 10 DEC 04]