Military health costs soar, raising possibility of higher out-of-pocket expenses

Pentagon spending on healthcare has soared from $19 billion in 2001 to a projected $50.7 billion in 2011, a 167 percent increase. Attributed to the surge in physical and mental health problems experienced by deployed military members and their families, the exploding costs are "beginning to eat us alive," Defense Secretary Robert Gates told Congress in February.

As a result, some military retirees and active-duty families may see their out-of-pocket expenses rise for the first time in 15 years, Rear Adm. Christine Hunter, deputy director of TRICARE, the military healthcare program, told USA Today.

Currently, active-duty troops and their families receive free healthcare except for out-of-pocket co-payments of $3 or $9 per prescription at civilian pharmacies. Retirees receive the same benefits by paying $230 a person or $460 a family each year, along with small co-payments for various types of care. Unlike continually rising private-insurance copays, TRICARE fees haven't changed since 1995.

"I want to be generous and fair to all those who serve, but there's a cost-containment problem," Sen. Lindsey Graham (R-S.C.) said at a recent hearing. "I don't see how we can sustain this forever, where TRICARE is never subject to adjustment in terms of the premiums to be paid."

Higher out-of-pocket costs are also being explored for the Pentagon, Hunter said.

To learn more:
- read this USA Today article
- check out this Wall Street Journal Health Blog post

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