Medical Costs Threaten Pentagon’s Fiscal Health

By Sandra I. Erwin
As if his weapons budget proposals weren’t already a tough sell on Capitol Hill, Defense Secretary Robert Gates also will try to get Congress to endorse unpopular health care fees for military retirees.

“I think we just need to lay out for the Congress how health care is eating the department alive,” Gates said. In fiscal 2010, the Pentagon will spend $47 billion on health care — the equivalent of the entire U.S. foreign affairs budget. Health costs have soared 144 percent since 2001 and are expected to climb an additional 40 percent by 2015.

The expansion of Tricare to cover military retirees is what is driving up the costs, said Deputy Comptroller Kevin Scheid. The program covers 9.2 million participants and oversees 63 major health care in-patient facilities across the United States, as well as more than 800 clinics. Scheid said the Pentagon will have to draw from other accounts to pay for health care.

“As health costs grow and the top line stays fixed, we will lose other capabilities,” he said. “We don’t want to become a Defense Department that is largely a health care system, as some corporations have found themselves.”

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Topics: Defense Department, Health Affairs

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