HR 3474/S2065 Talking Points Prepared By Phil Alperson, Legislative Assistant

Since 04-21-04

To All Retirees, Spouses, Widows, and Friends;The Talking Points below is to refresh everyone on exactly what HR 3474/S2065 is about and what it does. Phil Alperson has prepared and sent this to every U.S. Representatives Office so there should be no misunderstanding what HR 3474 is about - some will spin what the Keep Our Promise Bill is about, answer spin with facts - the data below is reliable.We urge everyone to print this information, keep it handy, send it to your own Representatives and Senators; extract pertinent portions and send as letters to Editors.

If you meet with Representatives or Senators, please take a copy of this with you so you can speak from facts. Remember, HR3474/S2065, Keep Our Promise Bill helps all military retirees, spouses and widows, no matter when retirement occurred, in our most pressing need, medical care. 

Harry Riley, CAG Rep H.R. 3474: TALKING POINTS:

Agents of the federal government – including military recruiters, active duty members of the uniformed services, and other government officials – routinely promised that the government would provide lifetime health care to military retirees and their dependants if they served a career of at least 20 years in uniformed service. The promise of lifetime care was made and fulfilled for generations, but until 1956 Congress had never passed a statute the specified what level of care would be provided.

On June 7, 1956 the President signed into law, with the effective date of December 7, 1956, the provision that provided for health care at military facilities on a "space available" basis. This law had the practical effect of defining and limiting the federal government’s commitment to military retiree health care, by conditioning such care on space availability. In other words, after 1956 health care that had been promised and routinely delivered for years was no longer assured.

And the verbal promises were not backed up by the law. As military bases began to close and downsize, the availability of health care became more and more limited. Subsequent laws completely removed Medicare-eligible military retirees from the military health care system.

The 1956 law "changed the rules in the middle of the game" for military retirees who entered the service prior to December 7, 1956. When they agreed to enter the service, they had promises – a verbal contract – of lifetime health care that routinely were fulfilled. When they left the service 20 or more years later, they lived under a new set of rules. In short, the rug was pulled out from under them.

On July 16, 1996 a law suit was filed in Federal Court in Pensacola, Florida by attorney Col. George E. "Bud" Day, on behalf of retired Air Force Colonels William O. Schism and Robert Reinlie, alleging breach of contract with military retirees over the age of 65 years by the failure of the U.S. to provide the military medical care it had promised.

Col. Day, a retired Air Force Colonel, is the nation’s most highly decorated officer since General Douglas MacArthur. Most notably, he had been held Prisoner of War for 67 months in North Vietnam and received the Congressional Medal of Honor.

The case reached a final resolution on November 18, 2002 when a Federal Appeals Court ruled that only Congress can authorize the level of health care the government will provide to military retirees; therefore, promises made by military or government officials were not binding.

On June 2, 2003, the Supreme Court declined the consider Col. Day’s appeal of the ruling, putting an end to the law suit.Although the Appeals Court did not rule in favor of the plaintiffs, the language of the Court ruling was very clear that the plaintiffs had won a moral victory:

‘‘Accordingly, we must affirm the district court’s judgment and can do no more than hope Congress will make good on the promises recruiters made in good faith to plaintiffs and others of the World War II and Korean War era—from 1941 to 1956, when Congress enacted its first health care insurance act for military members, excluding older retirees . . . .

We cannot readily imagine more sympathetic plaintiffs than the retired officers of the World War II and Korean War era involved in this case. They served their country for at least 20 years with the understanding that when they retired they and their dependents would receive full free health care for life.

The promise of such health care was made in good faith and relied upon. Again, however, because no authority existed to make such promises in the first place, and because Congress has never ratified or acquiesced to this promise, we have no alternative but to uphold the judgment against the retirees’ breach-of-contract claim. . . .

Perhaps Congress will consider using its legal power to address the moral claims raised by Schism and Reinlie on their own behalf, and indirectly for other affected retirees.’’

In 2000, Congress began to address the pressing health care needs of elderly military retirees by enacting Tricare for Life (TFL), which provides health care to Medicare-eligible military retirees (generally age 65 or older).  While TFL made great improvements in military retiree health care, it required them to pay for Medicare Part B coverage. 

H.R. 3474, the revised version of the Keep Our Promise Act, acknowledges the moral claims cited by the Federal Appeals Court by waiving the required Medicare Part B payments for military retirees who entered the service prior to December 7, 1956. 

Previous versions of the Keep Our Promise Act offered the CAG folks "fully paid FEHBP," which has been rendered moot by the success of TFL; H.R. 3474 replaces "fully-paid FEHBP" with the Medicare Part B waiver.  This new provision in H.R. 3474 is far less costly.

The Keep Our Promise Act also addresses health care promises made to military retirees who entered the service after 1956, when Congress began to enact laws that defined the level of health care that military retirees would receive. Despite enactment of these laws, promises of lifetime health care were routinely made for many years after 1956.

These promises are documented in recruiting literature. Congress has established a medical health care system for military retirees, which today is known as TRICARE. Health care coverage is provided at military facilities or by private health care providers who participate in the system.

Many military retirees are satisfied with the level of care they receive under TRICARE, but many others are not. The wait at some military facilities for even routine care can be months long. Many private providers will not put up with rules or paperwork they consider too burdensome or reimbursement rates they deem to be too low.

The result is that many military retirees who are not old enough to qualify for TFL receive little or no health care from a system that promised them lifetime coverage.For these retirees under age 65, who believe they are poorly served by the TRICARE system, the Keep Our Promise Act provides them the option of electing coverage under the Federal Employees Health Benefit Program (FEHBP) rather than TRICARE. 

To help offset the cost of individual premiums that are required under FEHBP, H.R. 3474, the revised Keep Our Promise Act, requires the Department for Defense (DOD) to reimburse retirees for expenses they incur under FEHBP that would have been covered under TRICARE STANDARD.

This is a new provision in H.R. 3474 that enhances the FEHBP benefit for military retirees, making the benefit equitable to the actual military health care benefit.

Under existing statute, military retirees who participate in other health insurance (OHI) rather than TRICARE can be reimbursed by DOD for certain prescription drug expenses.  OHI reimbursement levels are higher if a retiree can obtain prescription drugs from pharmacies that are part of a TRICARE network. 

H.R. 3474, the revised version of the Keep Our Promise Act, increases OHI reimbursements for retirees who are unable to gain access to network pharmacies. 

This is an additional benefit in H.R. 3474 for disabled retirees who simply cannot get to a network pharmacy and take advantage of the lower prices.

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