Defense Policy Bill Talks Stumble Over Military Benefits Dispute

By Megan Scully, CQ Roll Call

Negotiations on the final defense policy bill have stalled amid disagreements between House and Senate Armed Services committee leaders over issues affecting military benefits, congressional sources tracking the bill said Tuesday.

Committee leaders had hoped to finalize the negotiated bill early this week, but they have reached an impasse over differences in the two measures on cost-saving Pentagon proposals to increase some TRICARE pharmacy co-pays and reduce the basic housing allowance for military personnel.

The House-passed version of the bill (HR 4435) would deny the Pentagon its request on both issues, calling those proposals “piecemeal” and deferring instead to the findings of an upcoming commission on military compensation and benefits, which will issue a report early next year.

“While the committee recognizes the need for compensation reform, it believes such reforms must be examined holistically before proceeding with wide-impacting changes, and it looks forward to reviewing the recommendations provided by the congressionally directed Military Compensation and Retirement Modernization Commission,” according to the committee’s report on the bill.

But the Senate Armed Services version of the bill (S 2410) would limit the housing allowance increase below the rate of inflation, which could ultimately mean troops pay 5 percent of housing costs out of pocket. The bill also would green-light the Pentagon’s proposal to increase pharmacy co-pays for prescriptions filled outside of military treatment facilities.

In its report on the bill, the Senate panel said it “reluctantly” agreed to those Pentagon proposals, as well as a limited pay raise for military personnel.

The proposals, “while undesirable, are necessary to produce a DOD budget that provides sufficient funding to address readiness and modernization deficits, authorizes a sufficiently sized and trained force to meet national defense objectives, and adheres to congressionally mandated budget levels,” the Senate report states.

The savings generated by the co-pay increase and the reduced housing allowance are expected to total billions of dollars over the next several years. But even modest efforts to scale back military benefits have traditionally been met with heavy resistance on Capitol Hill.

The so-called “Big Four” undefined the top Republican and Democrat on each of the Armed Services panels undefined have been working for the last week to resolve the remaining differences in the bill, with the hopes of moving it through Congress during the lame duck session.

Congress has enacted a defense authorization measure every year for more than half a century, a track record that has boosted the power and influence the two committees have over Pentagon policy-making and budgetary priorities.

Senate Armed Services Chairman Carl Levin, D-Mich., and House Armed Services Chairman Howard “Buck” McKeon, R-Calif., are retiring at the end of this Congress, and neither man wants the committees’ streak to break on his watch.

Speaking to reporters on Tuesday, Levin would not discuss any details of the private negotiations or the remaining points of contention between the two chambers, but he said he hopes the bill would be completed soon.

“We’re not there yet,” Levin said. “That’s what it amounts to.”