Reserve GI Bill deemed ‘unfair’

Military reserve and National Guard members mobilized for the wars in Iraq and Afghanistan are discovering an inequity in their GI Bill education benefits that needs to be fixed, says Rep. Vic Snyder, D-Ark., a senior member of the House Armed Services Committee’s subcommittee on military personnel.

“It’s unconscionable how these young men and women are being treated now that have served their nation in time of war and completed their enlistment contract,” Snyder said.

Snyder served in the Marine Corps for 21 months, including 13 months in Vietnam. In return, he received 45 months of GI Bill benefits, enough to complete two years of college and three years of evening classes.

Today, active duty members who buy into the Montgomery GI Bill also do pretty well with post-service education benefits.

But consider the experience of reserve and Guard members, said Snyder. An initial commitment of up to six years can include up two years of involuntary active duty, with a year or more in a combat zone. Yet, reservists who leave the service after completing their obligations forfeit any unused Reserve GI Bill benefits.

Because reserve benefits were designed mostly as a retention tool, only members who stay in drill status subject to call-up, can use education benefits. In wartime, Snyder said, that is “terribly unfair.”

Twenty years ago, when Congress established the Reserve Montgomery GI Bill, it was fairly rare for people to be activated, Snyder said. “And even if they were, it was not going to be for a long period of time. That obviously is dramatically different now.”

Wartime mobilization not only deepens the sacrifice of reservists but limits their window of time for using reserve education benefits.

“They are put in situations where they are not going to be able to go to school,” Snyder said. “You say, ‘You can only use this benefit while in the reserves. Oh, by the way, for the next 18 months we’re going to put you in places where you ain’t going to go to school.’ “

Snyder pounded on the issue during a subcommittee hearing earlier this month. Witnesses included David Chu, the Defense Department’s top manpower official, and service personnel chiefs.

Chu promised Snyder that the 10th quadrennial review of military compensation, a yearlong study of military pay and benefits, will review the need for modifying Reserve GI Bill benefits. Chu noted that Congress “did pass at the president’s request an enhanced benefit for those mobilizing in support of current contingencies.”

He was referring to the Reserve Education Assistance Program, approved in 2004. Under the program, members mobilized for 90 days or more since Sept. 11, 2001, get extra education benefits. Rather than payments set at 29 percent of active duty Reserve Montgomery GI Bill, Reserve Education Assistance Program benefits equal 40 percent , 60 percent or 80 percent of active duty GI Bill, depending on length of activation. But like the Reserve GI Bill, unused Reserve Education benefits stop when a member leaves the service.

So, said Snyder, a reservist today can spend about as long on active duty and in a war zone as Snyder did 30 years ago “and get nothing from the GI Bill when they get out of the service.”

Health savings accounts

What military retiree would forfeit Tricare benefits for the chance to build a nest egg and enjoy some tax breaks through use of a Health Savings Account combined with a high-deductible health insurance plan?

Defense officials want to find out. They have asked Congress for authority to begin a pilot program for military retirees under 65 who want to enroll in one the accounts being offered to federal civilian employees.

With a Health Savings Account, as with conventional health insurance for federal civilians, the government pays about 72 percent of premiums. With the accounts, it also must pay 72 percent of the savings account contributions. Plan enrollees pay the other 28 percent of both premiums and contributions. Total contributions often are set to cover all out-of-pocket medical expenses up to the amount of the deductible, which can be as high as $5,250 for individual coverage or $10,500 for families.

Savings accounts that have balances after the first year, either because the family is healthy or it used health care prudently, continue to grow, with monthly contributions the next year to cover expenses below the deductible.

Defense officials couldn’t say what type of retiree might be enticed to forfeit Tricare and enroll in a Health Savings Account. Congressional staff members and service association representatives also were stumped.

Some suggested the idea for military accounts came from the White House. President Bush has touted the accounts as a way to make U.S. health care more affordable. Critics say the accounts are attractive only to “the wealthy and healthy,” which can effect the risk pool and result in higher premiums.

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