Military Benefit Cuts a Tough Sell in Congress

US Army

Last month, the Military Compensation and Retirement Modernization Commission produced a report that recommended a series of changes to the military’s retirement benefit system.

Among the proposals: shrinking retirement pay by about 20 percent, and phasing out the military’s current defined-benefit plan, in favor of a hybrid plan that features characteristics of a 401(k).

Another proposal however, would make benefits richer for long-time military members.

But Congress remained skeptical on Wednesday. From the Military Times:

Some lawmakers questioned the piece of the new retirement system that would offer troops a lump-sum “continuation pay” at 12 years of service. The commission’s data claiming that career troops would accrue more total benefits under the proposed system assumes that individual troops invest that money into their personnel retirement account and not touch it until age 59 and a half.

Rep. Susan Davis, D-Calif., doubted that all troops will make that decision.

“What if that assumption doesn’t bear out?” she said. “Is the whole program impacted if they don’t do that? Does it rest on that assumption?”


Rep. Joe Heck, R-Nev., chairman of the personnel panel of the House Armed Services committee, who is also a trained physician, raised concerns about the commission’s claim that Tricare is reimbursing doctors at rates lower than government-run Medicare and fair-market value.

“As a health-care provider for over 30 years, I question that assumption,” Heck said.

Military compensation is a controversial area for cuts, so it’s unclear if the political will exists to move forward with any of the commission’s proposals.

However, John McCain said last month he was open to reforming the military’s retirement system. From Military.com:

Sen. John McCain, chairman of the Senate Armed Services Committee, took the opposite position, saying he was open to possible changes in pay and benefits.
“I can probably support a number of changes that need to be made,” McCain said without giving specifics. He singled out the military health care system, which he said “has to be reformed.”

Read more on the proposed changes here.


Photo by Brian Schlumbohm/Fort Wainwright PAO

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