Bob Gates had a knack for pith. In one memorable instance, he declared that “health-care costs are eating the Defense Department alive.” As soon as a statutory freeze on enrollment fees expired, the Pentagon went at this problem with a small – but symbolic – fee increase for working-age military retirees. The 2012 National Defense Authorization Act that President Obama signed last month acknowledges this token fee increase and, for future years, it ties increases in working-age retirees’ enrollment fees at the cost-of-living adjustment (COLA) for retirement pay (see §701).
But health care inflation outpaces standard COLAs by a long shot, so this tweak in the NDAA is not going to stop TRICARE from consuming more and more of the defense budget. Still, enrollment fees were unchanged for sixteen straight years (1995 – 2011), and raising them by any percentage at all means that the bites will be smaller.
Taken together, the Pentagon is in a less bad position than it has been but is now statutorily prohibited from improving it (e.g., pegging working age retirees’ enrollment fees to health care inflation).