Opposition To Raising Retiree Drug Costs

January 15, 2004

Rep. Joel Hefley, R-Colo., has voiced his opposition to a proposal by White House budget officials to raise prescription drug fees for military retirees, their spouses and survivors in October.

The proposal, which was submitted by the Office of Management and Budget (OMB) to the White House in mid-December, would raise co-payment prescription drug levels for name-brand drugs from $9 to $20 and raise generic drug co-payments from $3 to $10. 

The plan also would require a co-payment of $10 or $20 at military pharmacies, breaking a long-standing tradition that all prescriptions filled on base are free to eligible beneficiaries.  OMB officials estimate that the higher co-payments could generate a five-year defense budget gain of $4.2 billion.

"This is a misguided proposal that arbitrarily asked veterans to absorb drug cost increases without any study or consultation with Congress," Hefley said. "I am pleased that the Pentagon signaled its opposition to the proposal and succeeded in pulling it from this year's budget package."

The Defense Department may evaluate whether an increase in co-payments is needed to contain costs.