Volume XIII

Volume XIII, Issue 8

Page 5

MOAA LEGISLATIVE UPDATES

* S.1156 would expand the requirement for the VA to provide nursing home care to veterans who have service connected disabilities rated at 50% or higher (currently 70% or above);

Legislative Update for Thursday, October 16, 2003:

Issue 1: Final COLA Update. Federal annuitants will see an adjustment of 2.1 percent for the coming year.

Issue 2: Legislators Announce Concurrent Receipt Deal

House Majority Whip Roy Blunt (R-MO), Armed Services Committee Chairman Duncan Hunter (R-CA), Veterans Affairs Committee Chairman Chris Smith (R-NJ) and concurrent receipt champion Rep. Mike Bilirakis (R-FL) met with MOAA and other military and veterans' associations today to announce a final concurrent receipt agreement with Senate leaders and the White House.

The proposal will benefit as many as 200,000 disabled retirees in two ways:

First, all retirees with at least 20 years of service and VA disability ratings of 50% or higher will see their military retired pay offsets phased out over a ten-year period starting January 1, 2004.
Second, the recently enacted Combat Related Special Compensation (CRSC) will be expanded to include all combat- or operations-related disabilities-from 10% to 100% ratings, also effective January 1, 2004. Currently, only those with qualifying disabilities rated 60% or higher or who have a disability associated with a Purple Heart are eligible.

In both cases, Guard and Reserve retirees with 20 qualifying years of service (including those with less than 7,200 retirement points) will be eligible.

Disabled retirees rated 50% and higher who do not elect CRSC payments should start seeing their retired offset phased out automatically, starting January 1, 2004. No application is expected to be required. For 2004, qualifying retirees should see their retired pay increase by a flat amount, depending on disability, as follows:

$750 for 100% disabled;
$500 for 90%;
$350 for 80%;
$250 for 70%;
$125 for 60%; and
$100 for 50%.

The remaining retired pay offsets would then be phased out over the following nine years. In 2005, they would get back another 10% of any remaining offset; in 2006, they would get back 20% of the remaining offset; in 2007, 30% of the remaining offset; and so on. By January 2014, disabled retirees with 50% and higher ratings will be entitled to full concurrent receipt of military retired pay and VA disability compensation.

Disabled retirees who qualify for both programs would have to choose one or the other. Because the CRSC program provides full payment immediately vs. the 10-year phase-in for concurrent receipt, legislators plan to allow an annual election option for CRSC-eligibles. This recognizes that a retiree who is 100% disabled, but only 60% of that is due to combat-related conditions, may find it advantageous to elect full CRSC payments for a few years until the concurrent receipt payment rises to a level that exceeds the CRSC payment. Because CRSC payments are tax-free and nondisability retired pay is not, this could also figure into qualifying retirees' election decisions.

Legislative Update for Friday, October 24, 2003:

Issue 1: No More Foot-Dragging on Military Tax Fairness. MOAA joined Rep. Chet Edwards (D-TX) at a press conference calling for an end to congressional leaders' foot-dragging on the Armed Forces Tax Fairness Act. MOAA has been running radio ads this week urging an immediate end to tax discrimination against service members and survivors.

Issue 2: Iraq Supplemental Must Address Troop Needs

In a letter to key House and Senate negotiators today, MOAA and The Military Coalition (TMC) said the final version of the $87 billion Iraq Emergency Supplemental funding measure should:

* Allow National Guard and Reserve service members the option of year-round TRICARE coverage on a cost-share basis, or federal payment of a share of the premium for their private health policies (similar to current policies for DoD civilians who are reservists); and extended post-deployment coverage under TRICARE.

* Increase the Army's end strength by 10,000. With three-quarters of the Army's brigades deployed and two more National Guard brigades being mobilized, it's time to face the fact that the Army has reached the breaking point and must be reinforced. The Senate bill includes the manning plus-up.

* Provide an additional $1.3 billion in funds to the VA health care system to care for wounded and ill returning veterans.

* Authorize funding to support the National Guard family readiness program. TMC urged the conferees to add funds for the other reserve components' family readiness programs as well.

*Authorize leave from civilian employment under the Family and Medical Leave Act so that certain family members can attend to deployment-related family matters while the military spouse is away.