May 1, 2013  

Tricare’s toll

To the Defense department for tackling the rising cost of military health care for retirees. As overall defense spending declines, the growing cost of caring for retirees and their families threatens to “eat the Defense Department alive,” as former SecDef Robert Gates put it.

As analyst Brittany Gregerson wrote in last May’s AFJ: Between 2000 and 2010, DoD’s health care costs rose from 4.5 cents to 6.1 cents of every dollar spent. This wasn’t, by the way, caused by the wars. The share of health care spending on active-duty service members dropped over the decade as retirees’ costs soared.

Instead, the increase was caused largely by lawmakers (and, to a much lesser extent, DoD officials) who allowed millions of non-active-duty people to join Tricare, increased their benefits, and decreased their share of the costs — creating a health care package far more lavish and cost-ineffective than most Americans have.

Moderately higher fees do more than raise revenue. They also help reduce demand. If Congress takes seriously its duty to spend defense money wisely, it will allow these fees to rise to help ensure the program’s viability for future forces.