Proposed Changes to Retirement Plans Could Strongly Impact Military Health System

WASHINGTON — Proposed changes to retirement plans are generating much discussion, especially because some professionals, such as those in the Military Health System, often count on pensions to compensate for lower pay levels and other sacrifices throughout their careers.

Maj. Gen. George K. Anderson

A recent Congressional Research Service report, which examined several recent proposals, noted that “few military subjects have generated as much interest or commentary as the military retirement system.”

The CRS report pointed out that those who criticize the current military retirement program “generally find fault with the 20-year ‘cliff’ vesting, the generous retirement benefits to youthful beneficiaries, the overall cost of the system, the lack of force management flexibility, and the inefficiency of the system.”

On the other hand, the report pointed out that those who defend the current retirement system “argue that it is compensation for a career of arduous, and frequently hazardous, service and sacrifice for the nation and that it is relatively consistent with retirement systems for other high-risk occupations,” the report noted. “Others view the retirement annuity as a ‘retainer,’ since retired military personnel can be recalled to active duty at any time.”

This CRS report reviewed various reform proposals and presented potential options for Congress that included maintaining the current system or creating a national commission that could review military compensation, benefits and retirement.

Exactly what military retirement should be, especially in the current deficit-reduction environment, is a question being considered by academics, politicians, advocacy groups and government leaders. The answers could have a significant impact on how clinicians and other medical personnel are recruited and retained by the military.

“To me the retirement plan, from my perspective — and I served 30 years in the Air Force — was extremely important,” George Anderson, MD, a retired Air Force flight surgeon and executive director of the Association of Military Surgeons of the United States (AMSUS), told U.S. Medicine. “I doubt I would have stayed in if it had not been in place, because you are not making enough money to really build your own retirement plan along the way.”

Anderson, who is also a member of the Defense Health Board, said that what is important is that what is offered in the retirement plan is “balanced and attractive.”

“What is important here is trust,” he said. “That 25-year-old who is looking at a career in the military needs to be able to trust their government that it is going to offer a plan that will be secure for their foreseeable lifetime. That is pretty profound, but that is really what it is about.”

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