Congress expected to battle over military pay limits, rising retiree insurance

WASHINGTON — The Pentagon’s plan to limit pay raises for troops and increase health insurance fees for military retirees is certain to ignite a political fight in Congress, which since the Sept. 11, 2001, attacks has consistently
raised military salaries beyond what the Pentagon has recommended.

But Pentagon officials have made clear that military personnel costs are on a disastrous course — Defense Secretary Leon Panetta has called them “unsustainable” — and that it is imperative that they be brought under control.

Military salaries have risen steadily since the Sept. 11 attacks, often because Congress gave the troops raises beyond those requested by the Pentagon. Officers have in many cases fared better than enlisted personnel: A private first class with a family and three years’ experience deployed to a war zone took home $26,700 tax free in 2001, compared with $36,000 today — an 11 percent raise over inflation. A lieutenant colonel with a family and 20 years’ experience in the same war zone took home $84,000 tax free in 2001, compared with $120,000 today — a 16 percent increase.

Health care costs for the Pentagon, the nation’s single-largest employer, have exploded in the past 10 years. In an attempt to rein them in, Panetta is calling for increased annual fees for the Pentagon’s health insurance — right now a family pays only $520 a year, far below the cost of a private carrier — and a fee for retirees older than 65 who enroll in Tricare for Life, a supplement to Medicare.

Panetta did not say what the new Tricare for Life fee would be. Currently, a retiree pays nothing for a benefit that makes up for whatever Medicare does not cover, although similar private supplemental health insurance costs an average of about $2,000 a year. One idea from the White House would have retirees pay a $200 annual fee for Tricare for Life, which the Office of Management and Budget said would save the Pentagon $6.7 billion in 10 years.