[Congressional Record Volume 147, Number 24 (Tuesday, February 27, 2001)]
[Senate]
[Page S1620]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DOMENICI:
  S. 394. A bill to make an urgent supplemental appropriation for 
fiscal year 2001 for the Department of Defense for the Defense Health 
Program; to the Committee on Appropriations.
  Mr. DOMENICI. Mr. President, as many Senators know, there has been a 
major problem in funding for health care for military families and 
military retirees since 1993. Budgets for the Defense Health Program 
have been submitted to Congress without requesting enough spending to 
cover all known medical and health care expenses.
  This problem has been recurring year after year because budget 
officials in the Department of Defense had been ``low balling'' their 
predictions of inflation in DoD's Defense Health Program; they have 
projected medical inflation at or below the overall economy's rate. 
Meanwhile, medical care costs have grown well above the national 
inflation rate.
  Since 1996 DoD has projected an average annual inflation rate of 1.8 
percent in the Defense Health Program, but the actual average rate over 
that time period is 4.9 percent.
  Just last year, DoD predicted 2.1 percent inflation for the Defense 
Health Program in 2001; experts are predicting the rate to be 7.9 
percent.
  This unacceptable budgeting practice has resulted in expenses being 
incurred but no funds to pay the bills. Congress has responded by 
funding these gaps with additional spending, usually in emergency 
supplemental appropriations bills.
  While we have addressed the problem when we ultimately learn the size 
of the funding gap, the inappropriate budgeting practices of the past 
have had a major negative impact on military service men and women, 
military retirees, and the dependents of both.
  When military medical personnel and civilian providers do not know if 
or when they will receive full funding, appointments for healthcare can 
be complicated, and the services rendered can be delayed or degraded. A 
system that many already find troublesome can become exasperating.
  This problem is not small; it directly affects an active beneficiary 
population of almost six million, including 1.5 million active duty 
servicemen and women, 1 million retirees, and 3.3 family dependents.
  For several years the problem has been growing, from approximately 
$240 million in 1994 to as much as $1.3 billion in fiscal year 2000. 
Coincident with the enactment of ``Tricare for Life'' and other new 
health care benefits in the Defense Authorization Act for 2001, the 
problem has remained at this all time high level and is currently 
estimated to be $1.2 billion for 2001. Some predict it may ultimately 
be $1.4 billion before the year is over.
  President Bush has already pledged that he will fully fund Tricare 
costs in 2002 at an estimated $3.9 billion, and I have every 
expectation that with the proper advice he will also fully fund all 
2002 Defense Health Program costs. However, the earlier 2001 funding 
gap remains, and I believe Congress can and should act as promptly as 
possible to fully fund all known costs.
  Accordingly, I am introducing legislation to provide a supplemental 
appropriation of the currently estimated $1.2 billion for the Defense 
Health Program for 2001.
  Because the money is needed on an urgent basis, I will discuss how we 
can address this matter with the Chairman of the Senate Appropriations 
Committee when he convenes a meeting of the Defense Subcommittee on 
February 28 to conduct hearings on the Military Health System. I fully 
expect that we will act as promptly as possible and in time to address 
real needs.

  I am also announcing four specific recommendations for the Defense 
Health Program I will make as Chairman of the Senate Budget Committee 
for the 2002 congressional budget resolution:
  Sufficient budget authority and outlays to enable the enactment of 
the 2001 appropriations legislation I am introducing today.
  An additional $1.4 billion in fiscal year 2002 to accommodate actual 
inflation in DoD health care, rather than the unrealistic under-
estimate left by the officials of the outgoing Administration.
  To accommodate future inflation, the budget resolution will also 
provide the requisite amounts of budget authority and outlays to 
accommodate 5 percent inflation for the next ten years. While I have 
every expectation that President Bush and Secretary of Defense Rumsfeld 
will address this underfunding in the 2002 budget, I am adding these 
amounts, totaling $18 billion over 10 years, just in case their review 
of the defense budget has not yet addressed the unacceptable budgeting 
practices of the past.
  In its current estimates, the Congressional Budget Office has not 
included additional discretionary spending in its ``baseline'' for the 
``Tricare for Life'' program. The technical reasons for this are 
esoteric, but the money is substantial, $9.8 billion over 10 years. If 
this money were not also added now, we would just be engaging in 
another form of underfunding.
  Congress and the executive branch have made various promises to both 
active duty and retired military personnel for their healthcare and the 
healthcare of their dependents. It is unacceptable to make these 
promises but not to include in the budget the money required to make 
good on them. The steps I am taking today are the first steps toward 
making that happen.
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