Action in Congress

Nov. 1, 2005

Senate Votes To Stop PTSD Review

The Senate has voted to block the Department of Veterans Affairs from conducting a review of documents concerning 72,000 supposedly settled cases of veterans rated 100 percent disabled from post-traumatic stress disorder.

On a voice vote Sept. 22, the Senate barred the VA from executing plans to review five years’ worth of PTSD cases until it justifies the action to Congress. The amendment also would prohibit the VA from withholding PTSD compensation, except in cases of fraud.

A House-Senate conference committee will decide whether the amendment survives. House Veterans’ Affairs Committee Chairman Steve Buyer (R-Ind.) has expressed concern about recent growth of PTSD claims.

The VA had announced that, starting in January 2006, it would begin a document review of PTSD claims settled from Oct. 1, 1999, through Sept. 30, 2004, and resulting in an award of a 100 percent disability rating.

The massive case review was triggered by a VA inspector general review of 2,100 randomly selected PTSD cases. The IG found that 25 percent lacked documents to verify traumatic incidents on which PTSD findings were based.

In light of this evidence, VA officials decided to restudy the paperwork.

VA spokesman Scott Hogenson said the second look would not reconsider diagnoses but would only verify that veterans provided the necessary paperwork to support their post-traumatic stress claims.

From 1999 through 2004, annual payments of PTSD compensation jumped from $1.7 billion a year to $4.3 billion. If the error rate is 25 percent, “questionable payments” would have cost $860 million in 2004 alone.

Swamped by complaints about the review from PTSD veterans and advocacy groups, Senate Democrats stepped in. Sen. Barack Obama (D-Ill.) called the planned PTSD case review “unnecessary and costly.”

The amendment, he added, seeks to ensure that the VA “cannot correct its errors by taking money away from veterans.”

Aiding Katrina Employers

Congress passed the Katrina Emergency Tax Relief Act of 2005 (HR 3768) with a provision from the Senate to help small businesses, including those that employ National Guard and Reserve personnel.

Current law allows employers to deduct the cost of salaries paid to employees. This bill would provide a 40 percent tax credit for wages of up to $6,000 after Aug. 28, 2005, and before Jan. 1, 2006, by employers located in the disaster zone.

Employers of activated Guardsmen and Reservists would be eligible for the tax assistance if they participate in a “pay protection” effort for their deployed employees.

Companies would continue to pay reservists enough that the troops’ total income did not fall while they are deployed, when their pay was combined with military pay and allowances.

Helping Vets Weather Katrina

Also because of Katrina, the Senate Veterans’ Affairs Committee modified legislation aimed at improving veterans’ health care, with new protection for military veterans displaced by the storm.

The Veterans’ Health Care Act of 2005 would provide free VA health care, through Jan. 31, 2006, to veterans affected by Katrina.

The legislation already had many other provisions to help veterans. The most significant would:

  • Allow reimbursement to eligible veterans of certain expenses incurred while receiving emergency care in non-VA facilities. To qualify, veterans must be enrolled in the VA health care system, have received care from the VA in the 24 months prior to the emergency episode, and meet other conditions.
  • Exempt veterans from VA co-payments for hospice care and—if they are former prisoners of war—for extended care services.
  • Allow VA to furnish care to a newborn child of a female veteran for up to 14 days after birth, if the child was delivered in a VA or VA-contract facility.

Posse Comitatus

Sen. John Warner (R-Va.), Senate Armed Services Committee chairman, wants to review the Bush Administration concept of broadening the role of the military in national emergencies.

On Sept. 25, the President urged Congress to study whether the Defense Department should take the lead in coordinating the nation’s response to hurricanes and other domestic catastrophes.

Bush conceded that the much-criticized federal response to Hurricane Katrina, and federal coordination and communication with state and local authorities, was inadequate in the first days after the hurricane destroyed portions of the levees surrounding New Orleans.

A few weeks later, during Hurricane Rita, Bush watched the storm push ashore in rural areas of Louisiana and Texas from US Northern Command headquarters at Peterson Air Force Base in Colorado Springs, Colo.

Bush said he was impressed by NORTHCOM and its capabilities and urged a robust discussion of the best ways to organize and deliver help to portions of the country hit by natural disasters or terrorist attacks.

For example, Bush suggested the military could determine and mobilize the national assets needed to respond to disaster.

Warner said the issue “deserves serious, timely review” by both Congress and the executive branch. Warner promised that his panel would review the ramifications of an expanded military mission on US soil.

Meanwhile, the committee awaited “more specifics” from the Administration.

Warner noted that expanding the military’s current role in large disasters would affect “the power of the states to respond to emergencies in their own localities, and, second, it would increase the power of the federal government.”

He urged Defense Secretary Donald H. Rumsfeld to study implications of an expanded military role in disaster relief. The Posse Comitatus Act bans active duty military from performing domestic law enforcement.

SBP Open Season

Retirees who declined Survivor Benefit Plan coverage as they left service have until Sept. 30, 2006, to enroll in a much-improved SBP. But the entry fee will not be cheap.

Under SBP, new retirees forfeit 6.5 percent of their monthly retired pay to fund the plan premiums. In return, the surviving spouse, ex-spouse, or dependent children receive an annuity when the retiree dies.

Most surviving spouses, for example, get 55 percent of “covered” retired pay until age 62, when benefits drop as low as 35 percent.

Congress last year voted to phase out that drop in SBP benefits at age 62 in four steps. On Oct. 1 this year, SBP benefits payable at age 62 rose to 40 percent of covered retired pay. By April 2008, the offset will be gone.

Total SBP benefits are projected to climb by $6.8 billion over 10 years.

Retirees who once turned down SBP now have a better plan to consider for their spouses. Most can buy in during the open season for a lump-sum amount plus future premiums.

The lump sum, by law, must cover all missed premiums since initial SBP eligibility at retirement, plus an interest charge of 6.25 percent.

Delayed enrollment, however, is more expensive for those who retired in the last six years. For them, the lump-sum buy-in formula includes an extra cost to cover any added “risk” to the retirement fund from delayed enrollments during the open season. Their lump sum payments are set high enough to end subsidy of their SBP coverage.

Retirees can get more information on the open season and help in calculating lump sum payments at the DOD Office of the Actuary Website.

Lottery Tickets

Defense officials have asked Congress for authority to sell state lottery tickets in Stateside exchanges. Advocates argue that the lottery sales could help offset a sharp drop in revenues expected from decreased use of slot machines at overseas bases.

Profits from lottery ticket sales, like those from slot machines, could be used to fund on-base recreational activities that, by law, must be self-sustaining.

Slot machine revenues overseas will decline, officials predict, as the Defense Department implements a plan to bring home more than 70,000 US troops, and their families, now based in Europe and South Korea.

Peter Isaacs, chief operating officer for the Army Community and Family Support Center, estimates that the Army inventory of slot machines will drop by 800. Total revenue to support Army morale, welfare, and recreational activities is estimated to decline by $50 million.

The Air Force won’t see the same impact. Net USAF revenue from slot machine operations in Fiscal 2004 was $10.6 million—about one-sixth the Army’s net revenue.

The Army and Air Force Exchange Service drafted the lottery ticket proposal now before Congress. John M. Molino, deputy undersecretary of defense for military community and family policy, said the motivator for AAFES is the obvious business opportunities that Stateside lottery sales present.

In 2004, more than 178,000 retail outlets sold state lottery tickets, earning commissions of more than $3 billion. Military exchanges want a part of that business.

Lottery retailers earn five percent to eight percent on each ticket sold, depending on state rules and incentives.

Authorization Bill Delayed

The Senate was expected to delay re-opening floor debate on its 2006 defense authorization bill (S 1042) until Oct. 19—almost three weeks into the new fiscal year.

The House passed its defense authorization bill June 6.

Military personnel, retirees, reservists, and their families still had much at stake in proposed amendments to the Senate bill. The most important, and costly, would:

  • End a reduction in military survivor benefit annuities for survivor spouses who also receive VA Dependency and Indemnity Compensation and see a dollar-for-dollar offset.
  • Move up by three years, to Oct. 1, 2005, the start date of the paid-up premium rule for the Survivor Benefit Plan. This would allow retirees who have paid premiums for at least 30 years, and have reached age 70, to end those deductions from their retired pay.
  • Immediately provide full retired pay, in addition to full VA disability compensation, to retirees with 20 or more years of service who are rated unemployable. These 28,000 retirees now are seeing their retired pay restored but on a 10-year phase-in.

Before suspending action on the defense bill, the Senate approved an amendment to provide a premium-based version of Tricare Standard to drilling National Guard and Reserve members. House Republicans shelved a similar measure as too costly.

Congressional staff members predicted a compromise will be reached by House-Senate conferees to approve an unprecedented health benefit for drilling reservists but that it perhaps will require an extended service commitment in return.

The Senate Appropriations Defense Subcommittee marked up its version of the 2006 defense appropriations bill on Sept. 26; the full Senate passed the measure on Oct. 6.