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Obama proposes TRICARE changes

Under the debt reduction plan proposed by President Obama mid-September, TRICARE pharmacy co-payments would be restructured and military retirees would pay an annual fee for TRICARE-for-Life health insurance.

The plan includes $6.7 billion in savings over ten years by establishing "modest annual fees" for members of TRICARE-for-Life, which becomes a second-payer insurance for military retirees upon turning 65 when they are transitioned to the federal Medicare program. The change would start in fiscal year 2013 with the introduction of a $200 annual fee.

Also included in the plan is a savings of $15.1 billion in mandatory funds and $5.5 billion in discretionary funds by restructuring co-payments for TRICARE pharmacy benefits.

The president's proposed plan attempts to bring the TRICARE plan more in line with private and other federal plans by eliminating co-pays for generic mail-order drugs and shifting retail co-pays from a dollar amount to a percentage co-pay. The change would affect military families and retirees, but would not include active duty service members.

Service groups which represent millions of military veterans quickly criticized the proposal. American Legion's Executive Director Peter Gaytan said that his organization, which has 2.4 million veterans as members, opposes any fee or co-pay hikes without offsetting cost-of-living increases in pensions.

The Military Officers Association of American and Veterans of Foreign Wars also oppose the changes.

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