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88–454 2014

[H.A.S.C. No. 113–109] 

BENEFICIARY AND ADVOCACY OVERVIEW 

OF THE FISCAL YEAR 2015 

PRESIDENT’S BUDGET 

HEARING 

BEFORE THE

SUBCOMMITTEE ON MILITARY PERSONNEL 

OF THE

COMMITTEE ON ARMED SERVICES 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

SECOND SESSION 

HEARING HELD 

APRIL 9, 2014 
(II) 

SUBCOMMITTEE ON MILITARY PERSONNEL 

JOE WILSON, South Carolina, Chairman 

WALTER B. JONES, North Carolina 

JOSEPH J. HECK, Nevada 

AUSTIN SCOTT, Georgia 

BRAD R. WENSTRUP, Ohio 

JACKIE WALORSKI, Indiana 

CHRISTOPHER P. GIBSON, New York 

KRISTI L. NOEM, South Dakota 

SUSAN A. DAVIS, California 

ROBERT A. BRADY, Pennsylvania 

MADELEINE Z. BORDALLO, Guam 

DAVID LOEBSACK, Iowa 

NIKI TSONGAS, Massachusetts 

CAROL SHEA-PORTER, New Hampshire 

CRAIG GREENE, Professional Staff Member 

DEBRA WADA, Professional Staff Member 

COLIN BOSSE, Clerk 
(III) 

C O N T E N T S 

CHRONOLOGICAL LIST OF HEARINGS 

2014 

Page 

HEARING: 

Wednesday, April 9, 2014, Beneficiary and Advocacy Overview of the Fiscal 

Year 2015 President’s Budget ............................................................................. 1 

APPENDIX: 

Wednesday, April 9, 2014 ....................................................................................... 21 

WEDNESDAY, APRIL 9, 2014 

BENEFICIARY AND ADVOCACY OVERVIEW OF THE FISCAL YEAR 2015 

PRESIDENT’S BUDGET 

STATEMENTS PRESENTED BY MEMBERS OF CONGRESS 

Davis, Hon. Susan A., a Representative from California, Ranking Member, 

Subcommittee on Military Personnel ................................................................. 2 

Wilson, Hon. Joe, a Representative from South Carolina, Chairman, Subcommittee on Military Personnel ........................................................................ 1 

WITNESSES 

Hayden, Col Michael F., USAF (Ret.), Director, Government Relations, Military Officers Association of America; Co-Chair, The Military Coalition ......... 3 

Jones, Rick, Legislative Director, National Association for Uniformed Services; Co-Director, National Military and Veterans Alliance ............................. 5 

APPENDIX 

PREPARED STATEMENTS: 

Hayden, Col Michael F. .................................................................................... 26 

Jones, Rick ........................................................................................................ 71 

Wilson, Hon. Joe ............................................................................................... 25 

DOCUMENTS SUBMITTED FOR THE RECORD: 

Statements from: 

Air Force Association ....................................................................................... 98 

Association of the United States Army ........................................................... 89 

Military Officers Association of America ........................................................ 153 

National Military Family Association ............................................................. 114 

Reserve Officers Association of the United States ......................................... 100 

The American Legion ....................................................................................... 151 

U.S. Naval Sea Cadet Corps ............................................................................ 149 

Veterans of Foreign Wars of the United States ............................................. 143 

WITNESS RESPONSES TO QUESTIONS ASKED DURING THE HEARING: 

Mrs. Davis ......................................................................................................... 165 

QUESTIONS SUBMITTED BY MEMBERS POST HEARING: 

[There were no Questions submitted post hearing.] 

(1) 

BENEFICIARY AND ADVOCACY OVERVIEW OF THE 

FISCAL YEAR 2015 PRESIDENT’S BUDGET 

HOUSE OF REPRESENTATIVES, COMMITTEE ON ARMED SERVICES, SUBCOMMITTEE ON MILITARY PERSONNEL, Washington, DC, Wednesday, April 9, 2014. 

The subcommittee met, pursuant to call, at 2:02 p.m., in room 

2118, Rayburn House Office Building, Hon. Joe Wilson (chairman 

of the subcommittee) presiding. 

OPENING STATEMENT OF HON. JOE WILSON, A REPRESENTATIVE FROM SOUTH CAROLINA, CHAIRMAN, SUBCOMMITTEE 

ON MILITARY PERSONNEL 

Mr. WILSON. Ladies and gentlemen, I would like to welcome everyone to a meeting of the Military Personnel Subcommittee of the 

House Armed Services Committee. The hearing will come to order. 

As we proceed, we will be hearing testimony from the representatives of The Military Coalition and the National Military and Veterans Alliance about military personnel issues addressed in the 

President’s budget submission for fiscal year 2015. 

Veterans service organizations are vital to providing firsthand 

advice and counsel to Members of Congress, and we really appreciate you being here today. 

Maintaining an All-Volunteer Force that has experienced almost 

13 years of persistent conflict is paramount for our national security. The subcommittee remains committed to ensuring that the 

men and women of our Armed Forces, military families, and the retirees who have served before them receive the benefits and entitlements they deserve. 

The President’s budget significantly reduces ground and air force 

end strength and slows the growth of compensation and personnel 

benefit programs for all service members, shifting spending to 

other programs. 

Our focus today is to discuss with the beneficiary and advocacy 

organizations that represent military members, their families, and 

retirees the reductions the Department [Department of Defense] is 

proposing to create efficiencies in personnel programs, to include 

pay, compensation, and health care, and whether these proposals 

should wait until the commission on military compensation is complete with its review and recommendations. 

Before I introduce our panel, let me offer Congresswoman Susan 

Davis, the ranking member of the committee, of California, an opportunity to make her opening remarks. 

[The prepared statement of Mr. Wilson can be found in the Appendix on page 25.] 
2 

STATEMENT OF HON. SUSAN A. DAVIS, A REPRESENTATIVE 

FROM CALIFORNIA, RANKING MEMBER, SUBCOMMITTEE ON 

MILITARY PERSONNEL 

Mrs. DAVIS. Thank you. Thank you, Mr. Chairman. 

Thank you both for being here. 

I also want to welcome our beneficiary representatives, Michael 

Hayden, who is representing The Military Coalition, and Rick 

Jones, who is representing the National Military and Veterans Alliance, big responsibility. A lot of people behind you. Thank you both 

for being here to represent a collection of military and veterans 

organizations. 

We know that there were many organizations that would like to 

have testified before the committee, and so we have a number of 

their written testimonies that will be submitted for the record. 

And, as you know, we could not accommodate everyone’s desire. 

It has been several years since we had the beneficiary organizations before the subcommittee. I believe that the last beneficiary 

hearing also focused on proposed changes to the defense health system that was included in the President’s budget. And here we are 

again, only this time the proposals being put forth are even more 

extensive than just military health care. 

And so the committee is faced with assessing the impact of several personnel and healthcare proposals that have been included in 

the President’s budget. These include a 1 percent pay raise for the 

force, except for general and flag officers, who would receive no pay 

raise in fiscal year 2015; an increase in the out-of-pocket expenses 

for housing; a reduction in appropriated support for the commissary system; travel and transportation benefit changes; and a 

restructuring and fee increase for the TRICARE system. 

Individually, you know, maybe to some, that does not seem significant, and the All-Volunteer Force may be able to withstand 

these changes. However, we know that that is not the case, that 

these changes are all being proposed as a package, combined with 

significant drawdown in end strength for the Army and for the Marine Corps, the realignment of forces in the Air Force, and an improving economy, which does have an impact, we know—which is 

a good thing, but it also has an impact. There is concern that the 

collective change may have an adverse impact on service members 

and their families and that they will vote by leaving the Armed 

Forces. 

Our Nation, as we know, is facing difficult economic times. With 

the threat of sequestration in fiscal year 2016 and beyond, the Department will be faced with making very difficult decisions. And if 

we do not make any changes to personnel costs, it will mean that 

there will be less resources for those who do remain in uniform to 

train and be prepared to win our Nation’s wars. 

That said, I also think that we need to take into account the 

work of the Military Compensation and Retirement Modernization 

Commission to ensure that we understand the cumulative effects 

of all of these changes and the potential impact to the recruitment 

and the retention of the All-Volunteer Force. 

We need to work together, and I know the chairman shares 

that—to find a way forward that will continue to ensure the benefits are there for those currently serving, especially those who are 
3 

in harm’s way, and to ensure that the benefits being provided are 

sustainable into the future. I look forward to a productive dialogue 

on your thoughts of how we can move forward. 

Thank you, Mr. Chairman. 

Mr. WILSON. Thank you, Ms. Davis. 

Now I would like to welcome our distinguished witnesses: 

Mr. Michael F. Hayden, Colonel, U.S. Air Force, retired, the Director of Government Relations for the Military Officers Association 

of America, MOAA. Colonel Hayden is representing The Military 

Coalition. 

And Mr. Rick Jones, Legislative Director, National Association 

for Uniformed Services. Mr. Jones is representing the National 

Military and Veterans Alliance. 

I ask unanimous consent to enter a statement from the Association of the United States Army, the Air Force Association, the Retired Officers Association, the National Military Family Association, the Veterans of Foreign Wars, the Military Officers Association of America, and the U.S. Naval Sea Cadets into the record. 

Without objection, so ordered. 

[The information referred to can be found in the Appendix beginning on page 89.] 

Mr. WILSON. Colonel Hayden, we will begin with your testimony. 

As a reminder, statements are to be held to 5 minutes. And 

Craig Greene is going to make sure all of us stay within the 5- 

minute rule. He is above reproach on his ability to keep time. 

And then, following your presentation, Mr. Jones. Look forward 

to this, obviously. And we do have your written testimony. Following each of your testimony, we will have rounds of 5 minutes 

each until adjournment. 

So we now proceed with Colonel Hayden. 

STATEMENT OF COL MICHAEL F. HAYDEN, USAF (RET.), DIRECTOR, GOVERNMENT RELATIONS, MILITARY OFFICERS 

ASSOCIATION OF AMERICA; CO–CHAIR, THE MILITARY COALITION 

Colonel HAYDEN. Chairman Wilson, Ranking Member Davis, and 

distinguished members of the subcommittee, on behalf of our coalition partners, I thank you for providing the opportunity to testify 

today on the fiscal year 2015 budget proposals by the Department 

of Defense. 

At the heart of the budget challenges facing the Department is 

the devastating effect of sequestration. Although the Bipartisan 

Budget Act of 2013 mitigated the sequestration spending cuts for 

fiscal year 2014 and 2015, the original sequestration cuts for 2016 

and beyond remain in effect and, we believe, will place national security at risk if continued. 

The coalition strongly urges Congress to eliminate sequestration 

and fund our military levels that enable our components of the 

Armed Forces to be adequately manned, trained, and equipped to 

focus on the mission. 

While debt reduction is a national priority, we believe such a disproportionate share of this burden must not be imposed on the 

Pentagon and especially on the backs of the military members and 

their families. No Federal obligation is more important than pro-
4 

tecting national security, and the most important element of national security is sustainment of a dedicated, top-quality, career 

uniformed force. 

The past 12 years of unprecedented demands and sacrifices highlight how radically different military service conditions are from civilian life. The only times the All-Volunteer Force has been jeopardized has been through budget-driven cutbacks in the military 

compensation package that gave insufficient weight to the extraordinary demands and sacrifices inherent in a service career. 

Yet budget critics persist in asserting that military pay and benefits since 2000 are unsustainable and they should be slashed to 

resemble civilian benefit packages. We believe it is important to 

put the growth-since-2000 argument in the proper context to understand why military pay and benefits rose faster than the average American’s from 2000 to 2010. 

Has cost growth gone up since then? Yes, certainly. But using 

2000 as a baseline without reflecting on the historical context is 

grossly misleading. This implies that the turn of the century was 

an appropriate benchmark for estimating what reasonable personnel and healthcare spending should be, and nothing could be 

further from the truth. 

At that time, years of budget cutbacks had depressed military 

pay to where a 13.5 percent pay gap existed. It cut retirement 

value by 25 percent for those post-1986 entrants. It had military 

families paying 18 to 20 percent out of pocket for their housing 

costs. And it booted beneficiaries over the age of 65 completely out 

of the military healthcare system. 

As a result, retention was on the ropes and the Joint Chiefs of 

Staff at the time were imploring Congress to fix the problems to 

prevent a readiness crisis. And Congress worked diligently over the 

next decade to restore military pay comparability, to repeal the retirement cuts, to zero out the housing costs, and to restore promised health care for older retirees. And the coalition thanks you for 

that. In other words, the cost growth was essential to keep the previous cutbacks from breaking the career force. 

Since then, Congress has implemented changes that have slowed 

the growth to personnel: a 16 percent increase to TRICARE Prime 

enrollment rates and significant increases to pharmacy fees. And 

both will continue to increase in the future years at the rate of inflation. A mandatory mail-order pilot for maintenance meds for 

TRICARE for Life beneficiaries was also implemented. 

End-strength reductions to the tune of 124,000 service members 

have already been started by the services, and this budget calls for 

an extra 78,000-plus in end-strength cuts. Since 2010, pay raises 

have dramatically slowed. They have either kept pace with the private sector pay or, in the case of this year, they have been capped 

below private sector. 

The fact is that, since 2000, personnel and healthcare costs experienced an average of about a 7.6 percent rate of growth. But that 

cost growth was essential to keep the previous compensation cutbacks from breaking the career force. And, since 2010, personnel 

cost growth has already slowed to less than 2 percent per year. 

Between the fiscal year 2014 and 2015 pay caps, this proposed 

BAH [Basic Allowance for Housing] change, the planned reductions 
5 

in the commissary, and the new healthcare fees, an E–5 family of 

four would experience nearly a $5,000 loss in purchasing power annually. For an O–3, that family of four would experience nearly a 

loss of $6,000 annually. 

These budget proposals would be major steps backwards towards 

repeating the insidious measures which led to retention and readiness problems in the past and would undo the needed compensation improvements Congress put into place since 2000. These piecemeal reductions are doubly inappropriate since the congressionally 

directed commission could be offering even broader reforms next 

year. 

America will remain the world’s greatest power only as long as 

it continues to fulfill its reciprocal agreement to the only weapons 

system that has never let our country down, and that is our extraordinary, dedicated, top-quality All-Volunteer Force. 

Thank you, and I look forward to your questions. 

[The prepared statement of Colonel Hayden can be found in the 

Appendix on page 26.] 

Mr. WILSON. Thank you so much, Colonel. And we appreciate 

your insight that you have presented. 

Mr. Jones. 

STATEMENT OF RICK JONES, LEGISLATIVE DIRECTOR, NATIONAL ASSOCIATION FOR UNIFORMED SERVICES; CO–DIRECTOR, NATIONAL MILITARY AND VETERANS ALLIANCE 

Mr. JONES. Chairman Wilson, Ranking Member Davis, and members of the subcommittee, thank you for the opportunity to appear 

before you this afternoon. 

National Military Veterans Alliance member organizations are 

deeply troubled by the administration’s budget plan, constrained as 

it is by a cap limiting national security resources. The plan makes 

steep reductions in force structure, compensation, and benefits that 

we cannot support. 

Certainly, progress must be made against the deficit and national debt; however, defense spending is not the driver of our national deficit or debt. It is a declining percentage of our Nation’s 

total economy. It is less than 18 percent of the total Federal spending. Yet, under sequester, defense faced 50 percent of the cuts. It 

is disproportional. It is disproportional by any measure, cutting defense too deeply, too steeply, too quickly. 

We were told it would never come into effect, yet we are now in 

year 2 of this blunt approach. Sequestration was bad policy when 

suggested, it was bad policy when accepted, it was bad policy when 

it began, and it remains bad policy to let it continue. To allow sequester-level cuts to persist would be a huge strategic miscalculation. It is not in our country’s best interest. The National Military 

and Veterans Alliance urges you to end sequestration on national 

security spending. 

Regarding the Pentagon proposals, the proposals include lower 

pay raise, increased out-of-pocket costs for housing, lower savings 

at the commissaries, increased TRICARE fees. The administration 

calls this a reasonable approach. In making the case for higher 

TRICARE fees, Comptroller Robert Hale said ‘‘Fee hikes would 
6 

bring money to the Pentagon needed for readiness.’’ Secretary 

Hagel said, ‘‘We have to burn personnel costs to save readiness.’’ 

Alliance organizations are all for military readiness. This is a 

perilous time. Failure to ensure readiness presents an unacceptable 

risk to our Nation and her troops. Readiness, however, is the responsibility of all Americans. Peace and national security are the 

most basic duty of the people as a whole. We can’t just place the 

burden on the backs of our service members. 

We commend members of the subcommittee for rejecting previous 

plans to increase TRICARE fees. Pentagon leadership used to say 

TRICARE costs were crippling national security, eating us alive. In 

a letter to former Secretary Panetta, you recognized that, instead 

of draining resources, the TRICARE account served as a cash cow. 

It was raided to pay for cost overruns in other programs. You noted 

that, in 2012, $708 million was stripped out of the TRICARE account, $772 million taken out in fiscal year 2010, a whopping $1.36 

billion taken in fiscal 2011, and in fiscal 2013 $800 billion moved. 

TRICARE is the most important noncash benefit provided to 

those who serve a career in the military. It is a promised benefit, 

part of a moral contract for a force that has served us well. To uphold this moral contract with our men and women in uniform, their 

families, and military retirees, we urge rejection of the new Pentagon plan to set participation fees for TRICARE programs. 

On commissaries, you know that commissaries are a core benefit 

of the military family, an integral part of total compensation. Military families see a 30 percent savings in shopping at commissaries. 

They save up to $4,400 a year. The Pentagon plan would crush 

that savings, hitting families right in the pocketbook. 

The strangulation plan the Pentagon has foisted out would mean 

higher prices at the commissaries, making commissary shopping 

less attractive, resulting in fewer customer visits and diminished 

sales. It would also cause a deep drop in sales at exchanges—exchanges which pay for Morale, Welfare, and Recreation programs, 

such as child care and sports programs for the family. 

Let me take an opportunity to praise this panel and the full committee for its passage, as part of the 2010 National Defense Authorization Act, the Military and Overseas Voter Empowerment 

Act. The MOVE Act has removed many of the obstacles for voting, 

particularly for members overseas. It has been effective, but, like 

everything on Earth, it is not perfect. We are asking you to take 

a second look at this and to consider ending the waiver for States 

that miss the 45-day deadline to mail ballots to those who request 

the right to vote. 

We also ask you to take a look at the SBP–DIC bill [Survivor 

Benefit Plan and Dependency and Indemnity Compensation], concurrent receipt, and a number of other issues that are outlined in 

the written testimony. 

Thank you again very much for the opportunity to testify. 

[The prepared statement of Mr. Jones can be found in the Appendix on page 71.] 

Mr. WILSON. Thank, again, both of you for being here today. It 

really has been so helpful to all of us, in a bipartisan manner, for 

the information that you have provided to correct some misstatements that have been made to this committee about eating the 
7 

healthcare budget alive. The research that was provided was very 

helpful to us so that we could best represent our constituents. So 

thank you very much. 

And, indeed, the point needs to be made, defense spending is not 

driving the national debt; that, indeed, the primary function of the 

national government should be national defense. And so thank you 

for what you are doing to protect American families. 

And defense sequestration, it needs to be addressed. And we will 

be having budget votes in the next 24 hours. And I am very 

pleased, and good people can disagree, but Congressman Paul Ryan 

does include addressing defense sequestration in one of the votes 

we have tomorrow. 

For both of you, the three options for TRICARE have allowed 

family members and retirees to choose the best option for their 

family. There is an effort promoting that just one TRICARE option 

would be provided to streamline the system. 

What do you think of these changes, and how would it impact retirees? 

And how will the co-pays impact retirees, Colonel? 

Colonel HAYDEN. Thank you very much. 

This consolidation effort, as we look at it, where you take the 

TRICARE Prime, Standard, and Extra program and you consolidate it into one, which much more looks like the old CHAMPUS 

program from years back, is, from our perspective, the service 

members, to include not just the retiree population, it is also going 

to impact the currently serving family members, that they are 

going to be paying more and they are going to get less of a program 

associated with it. 

For example, under the program, you take what is the TRICARE 

Prime enrollment fee, they relabel it as a participation fee. They 

keep the same value and keep it tied to the cost-of-living adjustments for that retiree. And what you end up losing here is the access standards that were guaranteed under TRICARE Prime so 

that you would be guaranteed to be able to get an appointment either in the MTF [military treatment facility] or in the network associated with it. And that was the whole purpose behind paying the 

enrollment fee in the first place. 

On top of it, for the retirees over age 65, a rehash of what was 

somewhat the proposal from last year, that under this they still 

wanted to do an enrollment fee for the TRICARE for Lifers over 

age 65. And this time it is capped at 2 percent of the retiree’s pay. 

And there are some caps associated with it for those that are 

O–6s and below, as well as a higher cap for those in the out-years 

for general officers and flag officers. 

The real issue is that we just think that this is—and it just flies 

in the face of the entire TRICARE for Life program itself, paying 

an enrollment fee where they are already paying Medicare Part B 

along with it. And there is no guaranteed access or anything else 

associated with this thing. So it is just foisting more fees onto the 

beneficiary, and that wasn’t part of the original bargain when 

TRICARE for Life was put together. 

And the ultimate issue is, when you go back and take a look at 

the proposals, what does it do to the currently serving family? And 

in there to encourage, if you would, those that go and use the 
8 

emergency rooms or they use the urgent care well, now, those families that actually will have limited or no access to military treatment facilities are going to end up paying much more. If it is an 

issue that takes place if you have a broken arm over the weekend 

or if you have someone who falls, your child, and hits their head, 

they are now going to pay a co-pay to go into that emergency room 

associated with it. And from us, this just flies in the face of what 

we should be providing to those military members and their families while they are serving. 

A lot of things transpired back in the late 1990s, where we went 

from hospitals and we downsized to clinics, and the clinics then no 

longer provided emergency-room care on the weekends or in the 

evenings. And so, now, many of the service members, even living 

on installations, if there is some kind of pop-up requirement, some 

medical emergency that they have, they are going to have to race 

off the installation and they are going to second-guess that because 

they are going to think about, do I want to pay the co-pay to go 

to the emergency room? They are going to want to wait and say, 

maybe I can wait a day until the military treatment facility actually opens up. And I don’t think we should actually be doing that 

to our military members and their families. 

Mr. WILSON. Thank you very much. 

And Mr. Jones. 

Mr. JONES. Agree completely with the Colonel. 

It looks as though the Pentagon has decided that TRICARE for 

Life was a mistake, and so they have decided to attach a participation fee to it. We don’t see it that way. We see TRICARE as the 

provision from a grateful Nation for full, affordable health care to 

those who have served. It is a respect, in essence, a respect of the 

value that has been received by the service that has been given. 

We stand in freedom today because of that service, and that 

TRICARE for Life is provided as part of the value that has been 

received by the Nation. 

We are very pleased with TRICARE for Life as it currently 

stands. We like it. We think it works well in most instances. And 

we disagree with the Pentagon on that issue. 

Regarding the consolidation, it appears as though well, we currently have Standard and we currently have Prime. Prime has a 

fee attached to it. And it looks as though the consolidation would 

squeeze Standard and Prime into one outfit, one function. And, essentially, you would pay Prime and receive Standard. You get less 

but pay more. 

So we do not believe that that is the direction you should follow 

either. It is not a good path. 

Mr. WILSON. And thank both of you. 

And as I conclude, I want to thank Mr. Jones for raising the 

issue of commissaries. This is a worldwide system which is beneficial to military families. It also provides employment for dependents and spouses worldwide. It is unique. It just simply can’t be recreated without really having a negative impact on military families. 

I now proceed to Ms. Davis. 

Mrs. DAVIS. Thank you, Mr. Chairman. 
9 

And I know that this is tough for everybody. And I think that 

the Congress has, certainly, great responsibility here, having not 

been able to come to a resolution at a time that was critically important for the country. And so I think we need to acknowledge 

that and try and move forward. 

I know how much time you spend with many of the people that 

you work with. And I am, sort of, looking for some reaction from 

folks and whether you have a sense from them that I think what 

I understand from your comments, of course, is that the sustainability issue is not really of so much concern. We probably need to 

be concerned about it, but I think right now there is not as much 

concern about that. 

What is it that you are hearing in terms of how we might 

prioritize some of this? You know, is there a difference, in terms 

of the issues that we are speaking about right now? And what is 

your sense? 

We know that there have been surveys, better surveys than we 

had in the past. Health care, certainly, is at the top of those, in 

terms of benefits that people are experiencing. And it matters a 

great deal whether you are talking to someone in the active service 

today or retirees; of course that matters. 

But what is it that you are pulling out of this that maybe isn’t 

quite as obvious here? 

Colonel HAYDEN. It is an interesting point, because when you go 

back to many of the surveys that are provided to service members, 

their families, retirees, and you try to look at prioritizing benefits, 

you can come up with statistically valid information that shows, 

you know, pay is extremely important, the retirement benefit happens to be important. Health care, of course, extremely important. 

You can find surveys that come out and say the commissary is a 

terrible benefit. And that is true if you are talking to someone who 

is maybe an E–1 or an E–2 that has no kids. So the real issue is 

you have to go beyond the surveys. 

And the interesting part is what we are getting the feedback 

from right now from retirees, from the currently serving and we actually have with MOAA today over 25 currently serving family 

members or currently serving members that are storming the Hill 

in efforts to try get the message across on what they feel about 

these things, the proposals that are coming forward, and not to 

look at it as a priority message but it is almost like a break-thefaith message is what they are having. 

Mrs. DAVIS. Uh-huh. 

Colonel HAYDEN. If you are going to look at these proposals, 

which we have characterized as almost Jello on the wall, it is just 

that the Department wanted to come over, they wanted to provide 

things, they think they can do these things without hurting retention, which, in our past case, you know, when you start doing pay 

caps, which is not just 1 year, they are talking now 2 years, with 

an additional 4 years in this, that we repeat the bad behaviors of 

the past, where it took Congress 10 years to fix the pay gap that 

existed in the late 1990s. 

So to prioritize associated with this, it typically depends on the 

group that you are talking to. But our immediate feedback that we 

have received is that these proposals need to be blocked. They need 
10 

to be looked at holistically. Congress put together the commission 

that is looking at this right now, and we are somewhat optimistic 

that they are looking at it just that way. 

Mrs. DAVIS. Do you think that—— 

Colonel HAYDEN. The feedback—— 

Mrs. DAVIS. If I could interrupt. 

Colonel HAYDEN. Sure. 

Mrs. DAVIS. Do you think that—who knows what exactly they 

are going to come up with. But the fact that they are looking at 

these issues and maybe looking at it more holistically, understanding that they are a package of changes that would have an 

impact on our families, would the same kind of recommendations 

make a difference, coming from them? I mean, is that part of what 

we are dealing with here? 

Colonel HAYDEN. I think the difference is their charter. The interesting part associated with it, they are not looking at a budgetcutting drill, which this definitely is. This is just ways to transfer 

money out of the MILPERS [Military Personnel] account, out of the 

DHP [Defense Health Program] account, and put it on the backs 

of the beneficiaries so that they can free up additional funding for 

other priorities within the Department. 

The best part that we are getting from the commission themselves is that they are trying to look at this and find out if there 

is a way to provide the benefit that could be done much more efficiently, much more cost-effectively, and at the end actually could 

end up improving retention and recruiting, which is the overall 

driver for strong readiness. 

Mrs. DAVIS. Uh-huh. 

Colonel HAYDEN. And, from our perspective, that is the way you 

should be looking at these, instead of hoping that after 2 or 3 or 

6 years of pay caps or eliminating—because what this really is 

going to do with the commissary benefit is you end up potentially 

just wiping the benefit completely out. And the whole purpose behind that is, you have people that are going to go from a 30 percent 

savings to a 10 percent savings in the commissary. And at the end 

of the day, they are going to vote with their feet. They are going 

to say, I am not going to go and drive on the post, you know, where 

it is going to take me 2 gallons of gas to get there and back, to get 

a 10 percent savings that we hope. And, ultimately, it is going to 

shutter commissaries. That is what our bigger concern is. And 

there is a definite need. 

And that is why we are hoping a much more holistic approach 

will be part of the solution here looking at these. I am not saying 

we are going to embrace everything that comes out of this commission. No. I think the important thing is to have the commission do 

their work, let this come forward, and then let it go through the 

due process and allow this committee to take a very hard look at 

this to make sure we are not going to damage the recruiting and 

retention in the future. 

Mr. JONES. It is interesting that most people do think, Ranking 

Member Davis, that pay is the most important thing and health 

care is not the most important thing to Active Duty, it is more important to retirees. 
11 

Interesting study I saw the other day, and I wish I could recall 

from where exactly, but it listed the priorities for Active Duty as 

being health care—— 

Mrs. DAVIS. Yeah, I—— 

Mr. JONES [continuing]. Because so many today are married. It 

is an All-Volunteer Force. Health care was number one. Education 

was number two. Pay was number three. 

So I think health care is important all down the line, and it is 

important to those families as a measure of quality of life. So it 

does matter. 

Mrs. DAVIS. Thank you. 

Mr. WILSON. And thank you, Ms. Davis. 

And we now proceed to Congressman Dr. Joe Heck of Nevada. 

Dr. HECK. Thanks, Mr. Chairman. 

Thank you both for being here today. 

You know, Colonel Hayden, I think you just succinctly gave the 

best analysis of the difference between the charter of the commission and the budget drill going on inside the building. And so 

thank you for putting that out there. 

You know, one of the things that—the phrase that is always 

thrown around is we have to keep faith with the men and women 

of our military. And I recently heard someone say that, in the current financial environment, that the phrase ‘‘keeping faith’’ may 

take on a different definition, where in the past ‘‘keeping faith’’ was 

always about pay and benefits and the promises made, whereas 

moving forward ‘‘keeping faith’’ may be more about making sure 

the individual is trained and equipped. Again, this idea of moving 

money from a MILPERS pot to a readiness pot. 

Your opinion on that changing definition? 

Colonel HAYDEN. It is an interesting, what I would consider more 

of, kind of, a bumper-sticker approach. 

For several years now, we have had unsustainability; growth is 

going through the roof, spiralling out of control. And now we are 

going, well, we need to slow the growth in the personnel accounts 

so that we have enough funding to provide for readiness, to provide 

for the equipment and the training associated with it. 

We look at it as almost like a false choice. You need to look at 

this as an entire package. You need to have the funding there for 

the acquisition programs, for the training, the equipment, definitely. But if you don’t—if you start scraping away at the pay and 

benefits, those things that you need in order to sustain the All-Volunteer Force, at the end of the day you may not have the triggerpullers or the bomb-droppers that you need. And that is where the 

real concern is for us. We are repeating some of those same behaviors. 

And, unfortunately, one of the bigger things that we are 

leveraging in this debate right now is end strength. As to try to 

balance the budget, if you would, or look at where the early savings 

are, as a former force planner myself with the Air Force, I was 

there, I knew what you could do with end strength: quick fix, quick 

money, and you draw down the force in order to go ahead and fund 

the F–35 or the F–22 program, which we did. And you cut below, 

and you were sitting there going, we can go down to 90 percent 

manning. 
12 

And I feel that, at the time, was a wrong maneuver that we did 

in the Air Force. And I am looking at it right now that we are just 

repeating that same bad behavior. 

Dr. HECK. Mr. Jones, you know, we talk about and you both 

mentioned some of the proposed changes in TRICARE. And I agree 

that what the drill looks like is really not—although it is being 

done under, quote, ‘‘decreasing the cost of health care,’’ end quote, 

that we are really not decreasing the cost, we are just shifting who 

is paying for it. 

Mr. JONES. Yes, sir. 

Dr. HECK. All right? So we are not decreasing cost. 

But to that end, if, let’s say, the commission or the entities come 

forward and say, look, we are looking at ways to try to actually decrease costs before coming to you and saying we need more premiums, fees, and co-pays, like the consolidation of TRICARE programs, irrespective of—let’s say it was done in a cost-neutral basis 

to the beneficiary, but there are opportunities for efficiencies. And, 

yeah, you may not get the appointment as quickly as you wanted, 

but this is a way for us to try to actually decrease costs to stave 

off increasing premiums and co-pays. 

Mr. Jones, where do you think that would fall with the community? 

Mr. JONES. Well, it is interesting that you say that we aren’t 

really decreasing costs. If you push costs or shift costs to the beneficiary, part of this package is to actually reduce or slow the growth 

of TRICARE. The intent is people won’t go, may not go, be more 

hesitant to go to see a doctor. But that is one of the elements of 

this. 

We know that a couple years ago that was exactly what the Department had in mind with rising TRICARE fees. They thought 

fewer people would go, fewer people would participate in 

TRICARE, and more people would jump the system and go into the 

private sector or perhaps go into the exchange which is now out 

there. So there is an element of decreasing costs with this shift. 

I may have missed your point, but—— 

Dr. HECK. Well, I guess, you know, if there are recommendations 

to come back that would fundamentally change the system, like, 

let’s say, a consolidation of the TRICARE programs, in an effort to 

truly decrease costs to the system so that there was no increased 

cost to the beneficiary, is that something that the community 

would be willing to look at and be willing to support? 

Mr. JONES. Yeah, we would be more than willing to look at something like that. 

Dr. HECK. Okay. 

Colonel HAYDEN. And I have to agree. I think the real issue here 

is, if it is transparent to the beneficiary or if the beneficiary actually—and what the commission is telling us, they are trying to figure out a way to even provide the benefit, a better benefit, at even 

a potentially lower cost. And that should be the premise behind it. 

It shouldn’t just be a cost-cutting drill. It shouldn’t be just, well, 

let’s do away with TRICARE Prime because it is more expensive. 

And that is what I think the real issue is. 
13 

We would be more than willing to take a hard look at these kind 

of proposals that provide the same level of benefit or better at a 

lower cost. 

Dr. HECK. Thank you, Mr. Chairman. My time has expired. 

Mr. WILSON. And thank you, Dr. Heck. 

We now proceed to Congresswoman Carol Shea-Porter of New 

Hampshire. 

Ms. SHEA-PORTER. Thank you very much. 

And thank you for being here. 

And let me say, I started off very prejudiced, having been a military spouse, and my father-in-law ran the commissary. So, you 

know, I am starting off in a position of actually knowing what this 

means to families. 

So I wanted to start by talking about the commissaries. My understanding is that a lot of the lower paid rank and file are actually qualifying for food stamps or the SNAP [Supplemental Nutrition Assistance Program] program. So what impact would this have 

if we take the commissaries away and they lose, basically, the savings that they have? Can you, kind of, estimate the impact that you 

think this would have on these families? 

Mr. JONES. Well, your point is well-taken, that there is an increase in food stamps in certain segments of the military, and families in particular, of course. And it would, it would hit them in the 

pocketbook. They would have to—the food stamps and their budget 

for food would not go as far. Their other payments for other concerns they may have for the family would have to be reassessed. 

So the point is well-taken. Food stamps only go so far, and when 

you have an opportunity to save 30 percent of your food costs at 

the commissary, your money goes further at the commissary. 

Colonel HAYDEN. As a former economist from way back when, 

okay, I have, kind of, crunched some numbers associated with this. 

And I actually got some numbers from the Department itself. 

DECA [Defense Commissary Agency] estimates that annual savings for a family of four shopping exclusively at the commissary is 

around $4,500 a year that they wouldn’t have—that they don’t 

have to pay because they don’t use the Safeways or the Giants outside the gate. 

The interesting part is that, with this proposal, because they go 

from what is a 30 percent savings, on the average, to now around 

a 10 percent savings, ultimately, for that family of four, they are 

going to lose $3,000 worth of purchasing power every year. That 

means they are going to have to find that $3,000 already within 

their budget to figure out how to pay and put the groceries, if you 

would, onto that table day-in and day-out. 

So that is what we see as the true financial loss associated with 

this. 

Ms. SHEA-PORTER. I find this breaking a social contract. You 

know, it has always been understood that if you served and you 

put your life at risk and left your family or took your family places 

they might not have chosen on their own, that there would be, at 

the end of the rainbow, you know, there would be this. So I am disturbed by pretty much all the changes there. 

But what is the tipping point? Because always in the military, 

if you ask Active Duty, they will say, my dad served, my mother 
14 

served, my grandfather served, my grandmother served. You know, 

there is a chain there. What is the tipping point, do you think, 

where they start saying, I can do better on the outside, this is just 

too much hassle, or a family member says, that is it, I am done? 

And I want to add to that, before you answer that, that I can remember during the Vietnam era and my husband was at Fitzsimmons Army Medical Center. And there were a lot of unaccompanied men on their last tour of duty because their wives and families were just shot, they had had it. And so they did their last assignment without their spouse there, because they were getting 

ready to retire and they wanted to finally go home after 20 years 

or 25 years. 

So what is the tipping point, do you think, where people say, no, 

you know, looking at all of it, I just can’t do it anymore, love my 

country, but I can’t do it anymore? 

Mr. JONES. Kind of hard to determine what the tipping point is, 

but, in conversation with our members, we note that there is a loss 

of confidence and a hesitancy to recommend to the boy next door, 

to the family friend whose child is thinking about going military, 

a hesitancy to say, yes, this is a good way to go. 

Nevertheless, the military still represents an outstanding pathway to becoming all—the old quote, ‘‘all you can be.’’ It offers a lot 

in education, in advancement, in confidence. So the military still 

stands as a great pathway in this country to have a better life. 

Colonel HAYDEN. I actually thought the tipping point was going 

to be about 2007. When you looked at what was taking place with 

the Army and the mid-level NCOs [noncommissioned officers] and 

the mid-level officers, if you would, actually junior and mid-level officers, and they were starting to show some real strain, and the 

services, especially the Army, had to start providing retention bonuses at very high numbers associated with it in order to sustain 

that career force, if you would, what you needed, that real experienced base in order to continue to lead, and when you look at that 

timeframe, prosecuting two wars, multiple deployments, 15-month 

deployments at the time, all the other things that were going on 

to the force, I thought that is where we were really stretching it. 

And the only thing that I really believe that saved us a little bit, 

number one, were all the work that you were doing to bring that 

compensation package back to where it needed to be and, number 

two, we didn’t have the greatest economy as we were coming out 

after that shortly thereafter in 2008, which kept a lot of the folks 

in. And that has retained a lot of the folks. 

I am more concerned right now that, with the rhetoric that we 

are starting to see and with the forcing out that we are doing with 

the end-strength reductions, we are hiding what could be a retention problem. We are already hearing from the service DCSPERs 

[Deputy Chiefs of Staff for Personnel], they are talking about how 

recruiting is starting to tighten up because the economy is starting 

to come back. 

And our concern is that, if you start doing this, where the economy starts coming up and at the very same time, you start bringing down if you would, the compensation package needed to sustain 

those people that have 10, 12, 15 years of service, there you are 

going to start putting real readiness at risk. Because you have to 
15 

take 10 years, 12 years, 15 years to build those NCO and that officer corps. 

Ms. SHEA-PORTER. That is my concern, too. Thank you. 

I yield back. 

Mr. WILSON. And thank you, Ms. Shea-Porter. 

We now proceed to Congressman Dr. Brad Wenstrup of Ohio. 

What? I can’t believe he left. Okay. 

We have Congressman Austin Scott from the Republic of Georgia. 

Mr. SCOTT. It is Wednesday. It was time for you to have a minor 

error, Chairman. 

Gentlemen, thank you for being here today. 

And I represent a tremendous number of men and women that 

serve our country, both in the civilian role and in uniform. And 

when I talk with the men and women back home, it just kind of 

makes the problem worse, in how much of the cut they are being 

asked to take. And when they look at us and they see us pushing 

changes to their benefit programs, reducing the promises that have 

been made to them, most of them tell me, I understand that minor 

changes have to be made, I am willing to take my share of them. 

Virtually every man and woman in uniform that works at our base 

says, I will take my share. But when you are funding free cell 

phones at the same time that you are cutting my benefits, that 

shows a lack of priorities from Congress. 

And I would just like to say, you know, I am sorry that we 

haven’t been able to set our priorities any better than that as a 

Congress. And to the men and women that are out there, I hear 

you, I hear you loud and clear. 

Dr. Heck mentioned something, and I agree with him, going back 

to the cost of health care. The cost of health care in this country 

far exceeds what a similar procedure costs in any other country in 

the world. And you can get—a procedure may cost $1,000 at one 

facility and $3,000 at another one, and there is no correlation in 

price and quality of that procedure. 

And it seems to me that if there were a way for us to work with 

people like you to make sure that we were able to get the highest 

quality health care at the lowest possible price, then we could put 

that—we can do a better job of fulfilling that promise to the men 

and women in uniform. 

And so my question is, as we go through all of these budget reductions and things that are being forced on the Pentagon, are 

there alternative savings or reforms that you see or ways that we 

could do this where we get the men and women that deserve this 

benefit more for their dollar? 

Colonel HAYDEN. I am more than willing to try to take this. 

I actually think there are ways to improve the benefit. You know, 

when you look at healthcare delivery, right now we have somewhat 

service stovepipe, still, operations. DHA [Defense Health Agency] 

was a step to try to consolidate some of this, but we still have each 

of the surgeon generals that are associated with it and they still 

have their own budgeting authority associated with the programs. 

Just when you look at economy of scale in purchasing, when you 

need, you know, a piece of equipment in one hospital and you still 

need another piece of equipment in a military treatment facility, 
16 

why not look at the economy of scale when you start doing the purchasing? Just because you are in one branch of the service and 

then another branch of the service and you have your own budget 

pots, maybe there can be a better way to do that, more of a purple 

way, if you would. 

Look, the coalition—not all coalition members have taken on and 

have agreed to a unified medical command, if you would. But this 

economy of scale, at least on the budgeting aspects, we can see that 

you could get some economy of scale on that. 

Mr. SCOTT. Well—— 

Colonel HAYDEN. And that is just one step. There have been several reports that have been out there before that have pushed to 

do just that. 

Mr. SCOTT. This is just somewhat brainstorming, but, you know, 

the way we handle Medicare Advantage, the participant can choose 

between different insurance carriers. And my understanding is that 

with TRICARE there is just one insurance carrier in the region 

that handles that, and there is no choice for the consumer. 

I wonder if we maybe took some of the things that we do in 

Medicare Advantage, where we have given the consumer more options, I wonder if we looked at trying that with TRICARE, if that 

would give us the ability to maybe drive down some of those costs. 

With that said, Mr. Chairman, I will yield the 13 seconds that 

I have left. 

Mr. WILSON. Here, here. Thank you, Congressman Scott. Thank 

you for your passion and concern. 

We are going to proceed, if there are any further questions—I 

just have one, because I just think a point that both of you have 

made just needs to be restated. And, in particular, that is the impact on families and the actual fiscal, f-i-s-c-a-l, impact on a family. 

Because that is what the people at home need to know and understand the consequence. Because they can identify—Colonel, you 

have already indicated a $5,000 net reduction in spendable capital. 

So, both of you, if you could restate again, do you see the additional cut of out-of-pocket housing expense, combined with the reduced less-than-ECI [employment cost index] pay raise, and an increase in commissary prices as a cut in the purchasing power? And, 

again, an estimate from each of you on enlisted and officers. 

Colonel first and then Mr. Jones. 

Colonel HAYDEN. It is definitely a loss of purchasing power, at 

the end of the day. The annual loss that we found for an E–5, 10 

years of service, if you would, family of four, with these proposals 

fully in place—and I consider this still a very conservative estimate. I used DOD’s numbers for the health care, if you would, 

which was what they figured would be an additional about $200 

out of pocket that a family would see. And I only did 2 years of 

the pay caps instead of the full 6 years of pay caps. 

So, with that in place, at the end of the 2 to 3 years of implementation associated with this, they are looking at a loss of annual 

purchasing power of $5,000 for that E–5. And for that O–3 family 

of four, it is almost $6,000. 

Mr. WILSON. Sadly, that is a number that families can understand. 
17 

Mr. JONES. It is a number that families can understand. And we 

agree with the numbers. But there is also a retention here—there 

is a cost to the country, as well. These folks who lose that amount 

of money may decide that this is not the path they want to follow, 

they don’t want to follow a career in the military, they don’t want 

to serve in the military. 

And that is a consequence of these proposals, a possible consequence, a second-tier, third-tier, or fourth-tier consequence that 

we haven’t really looked at with this budget plan that has come out 

from the Pentagon. 

Mr. WILSON. And, Mr. Jones, thank you for pointing out about 

retention. And people need to understand, the persons who are 

serving in our military are very skilled. We are facing an asymmetric, illegal enemy combatant, not in uniform, people who use 

women and children as shields. We have really never seen such 

conflict. And the training of our military personnel is extraordinary 

to face people who would equally and enthusiastically with a vehicle-borne IED [improvised explosive device] blow up a group of children. How can you—the training for this takes time. 

So I want to thank you. 

And anyone else, any further questions? 

Yes, Ms. Davis. 

Mrs. DAVIS. Thank you, Mr. Chairman. 

And I know in your positions you might not necessarily have 

some of the input from the Guard and Reserve. But I am wondering, certainly in terms of the commissary—and I think some of 

the latest studies demonstrate that it is actually the Guard and Reserve that are using food stamps at a fairly high rate. Do you have 

any sense of that and the usage, in terms of the commissaries, for 

the Guard and Reserve and how they would be impacted by this? 

I guess the food stamp really would indicate that, in their regular jobs, in addition to the time that they deploy as Guard and 

Reserve, you know, that they are struggling. And we know that we 

have had, you know, a number of attempts to cut food stamps, 

which has affected this group of folks. 

Mr. JONES. You know, the economy has not been good, and we 

have watched an explosion in food stamp usage. Whether it is due 

to the economy or due to expansion of eligibility in food stamps, no 

one is really sure at the present. But we just recognize that, I think 

it is 41 million people today are on food stamps, 7 million some 6, 

7 years ago. I am not sure of those, but I do recall reading an article on that. 

But I do not have statistics on the Reserve use of food stamps, 

just the knowledge that food stamps are being used in the commissaries. And I spoke with someone just the other day who said 

to me, it breaks my heart to see a young family at the commissary 

using food stamps. 

Mrs. DAVIS. Yeah. I know in our community, as well. I mean, 

many groups have stepped in, actually, to provide help from the— 

you know, vegetables and meals and a whole host of others for our 

service members at Pendleton and other places. 

Colonel HAYDEN. And we don’t have the statistical information 

associated with that. It is something that I could take back and try 

to provide you some information that we have. 
18 

The one thing I do know about food stamps, and it is kind of an 

interesting twist, at least for the currently serving, the Active Duty 

force, if you would, when you take a look, there are some rule sets 

associated with it, that if you are living on post, of course, you are 

not receiving a housing allowance associated with it. And so you 

could actually qualify for food stamps living on post, where if you 

live off post and are receiving a housing allowance, it then goes in 

and it shows the scale associated with it, so you wouldn’t be eligible to receive the food stamps. 

So it becomes one of those things, what counts, what doesn’t 

count, as you try to figure out the eligibility criteria on this. 

Mrs. DAVIS. Uh-huh. 

Colonel HAYDEN. But I will go back and take a look at the Guard 

and Reserve and get back to you. 

[The information referred to can be found in the Appendix on 

page 165.] 

Mrs. DAVIS. Yeah, okay. Thank you. 

And I know that we also have obviously had a chance to speak 

to service chiefs on this issue. And probably in the next few weeks, 

I think that, you know, they feel there is a case to be made in 

terms of readiness and whether or not families would trade off 

that, again, false choice, I think, as you are—but, nevertheless, 

would they trade off training and access to supplies, not to canonize ships, all those things, for other changes that would be occurring. 

I am sure you have had those discussions. 

Mr. JONES. Just, when you put a cap on how much you are going 

to allow for spending in defense, you make it an arithmetic exercise, rather than basing the expense on your national strategic plan 

or the threats that you face. I think you are always going to have 

a problem in squeezing out some of these very important programs 

that help the quality of life for families and those who serve. 

And that is what we are in this year, and there are tradeoffs in 

that. And we just shouldn’t be there, we should not be there with 

our defense policy. This was the wrong way to go. And, again, we 

were told we would never follow this path of sequestration. 

Mrs. DAVIS. Uh-huh. 

Can I ask you, did you think that the commission, did they ask 

the right questions? Do you think they were helpful in that way as 

they interviewed you? 

Mr. JONES. The Military Compensation Retirement—— 

Mrs. DAVIS. Right. 

Mr. JONES. Their questions—you know, they are looking, I think, 

at the right things at the present time. They may have been the 

source for the earlier comment about the survey putting health 

care, education, and pay in that order with our young service members. 

Mrs. DAVIS. Uh-huh. Thank you very much. 

Thank you, Mr. Chairman. 

Mr. WILSON. Thank you. 

We now proceed to Congressman Scott. 

Mr. SCOTT. Thank you, Mr. Chairman. I will make this brief. 

Colonel Hayden, I think one thing that, I think, as we do the 

arithmetic, as you said, Mr. Jones, in making sure that the public 
19 

understands the impact of this is, we are not talking about $4,800 

a year from somebody who makes $200,000 a year. And so, you 

said this is for an E–5? 

Colonel HAYDEN. The E–5 loses about 8 percent of their regular 

military compensation [RMC] with this. The RMC, if you would, 

was many times measured by the Department itself, and about a 

6 percent loss is what we calculated. And that is kind of a backof-the-envelope, so trust me on this, that is what we are looking at. 

But about an 8 percent or a 6 percent reduction in RMC. 

Mr. SCOTT. But as a percentage of their disposable income, it 

would be significantly higher. Just like every American, they have 

car payments, they have other payments that come out of their 

paycheck that are not optional, that they can’t just get rid of. 

Colonel HAYDEN. This is money they have to find in their current 

budget now. 

Mr. SCOTT. That is absolutely right. And so, while it may be 8 

or 10 percent of pay, it may be 40 or 50 percent of disposable income that they have after they have made their car payment and 

other payments that they have. 

So just, I appreciate what you are doing. Look forward to working with the two of you and helping you. 

Mr. WILSON. Thank you, Mr. Scott. 

Dr. Heck. 

Dr. HECK. Thanks, Mr. Chair. 

And I just want to follow up on a couple things. Certainly, I appreciate the perspective you give about the impact on retention, 

but, you know, it is also going to impact accessions, right? And we 

have seen recent surveys showing that there is a much lower propensity towards military service of men and women—or males and 

females in high school right now for entering military service. Of 

course, part of that is due to a resurging economy, but also many 

people are concerned about what that phrase, ‘‘keeping faith,’’ is 

going to mean to them, should they commit to time and service. 

And, Mr. Jones, I think you said it very well, in that this is turning into an arithmetic problem as opposed to a strategy problem. 

And I think, although not in this subcommittee, but that has been 

a discussion that we have had about the last QDR [Quadrennial 

Defense Review], and really trying to develop a QDR to a budget 

as opposed to the legislative mandate, which is the 20-year outlook 

at low to moderate risk. 

I agree that we need to withhold any decisions until we hear 

from the commission. In fact, that was the point I brought up when 

we had the Assistant Secretary and the G–1s here not too long ago. 

So I appreciate you reiterating those points. 

Thank you both for being here and representing the men and 

women in uniform and our retiree population. We appreciate it. 

I yield back. 

Mr. WILSON. Thank you, Dr. Heck. 

And, again, thank both of you for being here, Colonel Hayden 

with The Military Coalition, and Mr. Rick Jones, who is representing the National Military Veterans Alliance. 

And I would like to remember that Mr. Jones actually served at 

Moncrief Military Army Hospital at Fort Jackson, South Carolina. 

And he is still beloved. So this is good. 
20 

And thank you all, your sincerity on behalf of the military, military families, and retirees. Thank you. 

And we are adjourned. 

[Whereupon, at 3:03 p.m., the subcommittee was adjourned.] 
A P P E N D I X 

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WITNESS RESPONSES TO QUESTIONS ASKED DURING 

THE HEARING 

APRIL 9, 2014 

(165) 

RESPONSE TO QUESTION SUBMITTED BY MRS. DAVIS 

Colonel HAYDEN. During the hearing, ranking member Susan Davis (D–CA) requested information regarding food stamps/commissary and the Reserve Component. 

Interest in this issue surfaced following the February CNN Money report that 

highlighted the use of food stamps or Supplemental Nutrition Assistance Program 

(SNAP) benefits has increased at military commissaries. The following chart was included in their article: 

Military dollars spent on food stamps 

Source: Defense Commissary Agency 

MOAA reached out to the Defense Commissary Agency (DeCA) and the Department of Defense to see if they had any data as to why the marketed increase since 

2008. DeCA stated they were gathering demographics, but as to date, have not 

shared the information. 

Here is information that we have been able to gather that has led to increase 

usage by service members, veterans, and their families who may qualify for food 

stamps: 

• According to DOD, of the 44 million Americans who qualify for food stamps, 

only 5,000 are active duty service members. The military services have offered 

the Family Subsistence Supplemental Allowance (FSSA) since 2001 specifically 

designed to lift the income of a military family above the eligibility for food 

stamps. 

• Authorized commissary patrons as defined by Department of Defense Instruction 1330.17, Armed Services Commissary Operations, include active duty, 

Guard and Reserve members, military retirees, Medal of Honor recipients, 100 

percent disabled veterans, and their authorized family members. 

• The 2004 National Defense Authorization Act opened up access to the commissary for members of the Guard and Reserve. With the proper ID, unlimited 

commissary shopping privileges are authorized for: 

• Ready Reserve members (Selected Reserve, IRR, and Inactive National 

Guard) 

• Retired Guard members 

• ‘‘Gray Area’’ Guard retirees not yet age 60 

• Dependents of these members with a DOD family member ID 

• In the 2008 NDAA, The House bill contained a provision (sec. 651) that would 

require the Secretary of Defense to revise regulations to ensure access to the 

defense commissary and exchange system by the surviving spouse and depend-
166 

ents of a veteran who had a service-connected disability rated at 100 percent 

or total, although the disability rating was awarded posthumously. The provision was not adopted, but the conferees believed that this change could be done 

in the regulations without the need for legislation. Accordingly, the conferees 

direct the Secretary of Defense to revise the Department of Defense regulations 

to provide access to the defense commissary and exchange systems. 

• In 2009, as part of an involuntary separation incentive, member of the Armed 

Forces who is involuntarily separated from active duty under other than adverse conditions through Dec. 31, 2012 may continue to use commissary and exchange privileges for a two-year period beginning on the date of involuntary 

separation. 

Unfortunately, we do not have a specific answer as to the cause of the increase 

in use of food stamps at commissaries. We can only speculate that the combination 

of increased access by survivors and/or families, as well as the guard and reserve— 

all who could be eligible for food stamps—and the downturn of the economy (and 

job market in 2008), could have led to more of this population becoming eligible for 

food stamps and usage at commissaries. [See page 18.] 

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