President’s Budget Released – Questions Still Persist for Military Families

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The Administration released the 2015 Budget Proposal on March 4, 2014, giving us more details on the Department of Defense (DoD) proposal we caught a glimpse of a week earlier.

The proposed budget includes cuts to military compensation and benefits which – if passed by Congress – will affect you as a military family. The proposals include a one percent pay raise for service members in 2015, significant cuts in commissary funding, reduction in Basic Allowance for Housing (BAH) rates, and increased TRICARE fees for some currently serving families and retirees.

We will spend the next few weeks in meetings and roundtable discussions asking a lot of questions about how all of this will be implemented and how it will impact military families’ quality of life.

Here’s what we do know:

Lower pay raise + loss of commissary savings + reduced BAH + more out of pocket medical costs = service members and families bearing the costs of flat budgets and sequestration.

Proposed Cuts and Changes to Compensation and Commissaries

The DoD budget proposal includes the following changes that will affect military families:

  • A one percent pay raise for service members in 2015. General and Flag Officers will have their salaries frozen at present levels.
  • A $1 billion cut to funding for commissaries over a three-year period. Overseas commissaries and those in remote areas will still be subsidized. Cutting DoD support to commissaries will result in significantly smaller commissary savings for military families. DoD says it will not close any commissaries but will a reduction from 30 percent to 10 percent savings discourage you from shopping at the commissary?
  • Slowing the growth of Basic Allowance for Housing (BAH) payments from covering 100 percent of housing costs to an average of 95 percent. DoD will no longer include the cost of renter’s insurance in BAH calculations. This will be a phased-in cumulative decrease of 6% over time.
  • Modifying the TRICARE fee structure so some currently serving family members and retired beneficiaries will pay more in deductibles and co-pays. This may change the TRICARE Prime, Standard and Extra options as we know them today. DoD says these changes are designed to encourage TRICARE beneficiaries to get health care from facilities and doctors who operate at lower cost to the government, such as military treatment facilities (MTFs) and preferred network providers. Medically-retired service members and their families, as well as survivors whose military sponsors died on active duty, would see smaller fee increases. Bottom line: if you go outside the MTF or the network, currently serving or retired, you would pay more.
  • Adjustments to pharmacy co-pay structures and establishment of a modest annual enrollment fee for the TRICARE-for-Life coverage for Medicare-eligible retirees.
  • The plan does not propose any other changes to retirement benefits. The overview recognizes the role of the Military Compensation and Retirement Modernization Commission and the importance of allowing the commission to complete its task.

Proposed Cuts Have a Long-Term Impact

These changes to military compensation and benefits will have a profound effect on the financial well-being of service members, their families, retirees and their families, and survivors. We understand cuts and changes need to be made. But why should military families absorb those cuts while we remain a military at war?

Our Association continues to stress to policy makers the importance of the commissary savings, a realistic and responsive housing allowance, robust access to health care, and overall compensation commensurate with the service performed and the sacrifices military families are asked to make. We will continue to share with DoD, Congress, and other policy makers why this compensation is so important to maintain a ready force. Remember, this is a process. Add your voice to ours. We call on Congress to honor its commitment to our military.

Add your voice in the comments below:

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Comment: Please keep your commitment to honor our service members. How can Congress try to increase their pay and get exempts from Obamacare, and at the same time cut benefits to the military? One of these groups is putting their life on the line, while the other is safe behind a desk. Tell me which one truly deserves the best this country has to offer.
Submitted by: Spouse on February 25, 2014
Comment: I think it's horrible that this administration is looking to make so many cuts that effect military personnel and their families that have sacrificed and given so much to our nation while entitlement spending remains the same and at an all time high! Despicable just plain despicable!
Submitted by: Mrsjuju on February 25, 2014
Comment: My husband served over 22 years in the Army including 3 tours in Viet Nam. He was promised the benefits that we have because the pay was never equal to the job he did. The wars since then have left our young men and women with severe disabilities and it is outrageous that they cannot count on the support of our government.
Submitted by: BC on February 25, 2014
Comment: This is the reason why our military fighting power is decreasing. No respect towards the military and their family. Why are we cutting pay and allowances for the people that fight for our country and not the ones that sit up there in congress and make decissions that affect us and not them. This is wrong and something needs to be done about this. Disrespectful and distasteful.The decission makers have now lost faith with the military.
Submitted by: MGYSGT on February 25, 2014
Comment: This is so sad. When they talk about making cuts to the military it should not be cutting the money that pays the hard working individuals who make up the forces. They should make budget cuts to their lifetime paychecks.
Submitted by: Abby on February 25, 2014
Comment: This is awful, our Military put their lives on the line for freedom! We need to speak up on their behalf now!
Submitted by: BJ on February 25, 2014
Comment: Do not reduce those that fight for your freedoms pay and allowances. If we keep or better our coverages, pay and allowances then the need us to back you on issues will continue otherwise you will be voted out simply by military pers and their families because those are this nations greatest assets.
Submitted by: Vet32 on February 25, 2014
Comment: Same stuff, seems they never cut freeloaders, they cut the workers. I'm tired of the president I don't know how much longer this country will last. The government gives out so many entitlements, people don't realize they are borrowing from china to pay the freebies. We have a society today being created of takers not givers. Jesus said its better to give than recieve. Honestly there is nothing that can be done about this unless there is another civil war. Democrats lie quite a bit, I've seen them say we don't have a spending problem. If they ran there own lived the way the government does they wouldn't have anything, no house, no car etc.
Submitted by: fish on February 25, 2014
Comment: My husband sacrifices so much for this country and works so hard, with so much pride! Don't let him down like this. Worrying about how to support his family is added stress on top of an already very stressful lifestyle. This will only make it harder!
Submitted by: JH on February 25, 2014
Comment: This is not right. I understand that there are necessary cutbacks but why isn't it being done to congress? They are receiving raises and the men and women who protect this countries freedom are being punished. Most of the congressman wouldn't have the gall to deploy or the ability to handle what some of these soldiers have gone through. Or even cut back the amount of money given to other nations. Or possibly throw out the illegal immigrants rather than giving them welfare benefits after they have broken the law.
Submitted by: Missy on February 25, 2014
Comment: Let our government go after and eliminate the mountainous amount of fraud and misuse of money before even Daring to use the military to solve any budget woes. The American military communities are hard working and honorable. They exemplify the values that all areas of our society should want! Clean out fraud, poor use of funds, pork barrel spending. Make sure members of our miltary forces feel the respect they so deserve!
Submitted by: on February 25, 2014
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