I 
108TH CONGRESS 
1ST SESSION H. R. 3474
To restore health care coverage to retired members of the uniformed services, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 6, 2003
Mr. VAN HOLLEN (for himself, Mr. EDWARDS, Mr. MILLER of Florida, and 
Mr. CUNNINGHAM) introduced the following bill; which was referred to 
the Committee on Armed Services, and in addition to the Committees on 
Government Reform, Ways and Means, and Energy and Commerce, for 
a period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the com-
mittee concerned 
A BILL 
To restore health care coverage to retired members of the 
uniformed services, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Keep Our Promise to 
America’s Military Retirees Act’’. 
SEC. 2. FINDINGS. 
Congress finds the following:
(1) No statutory health care program existed 
for members of the uniformed services who entered 
service prior to December 7, 1956, and retired after 
serving a minimum of 20 years. 
(2) Recruiters, re-enlistment counselors, and of-
ficers at all levels of the uniformed services, and 
other government officials, as agents of the United 
States Government, used recruiting tactics that al-
lowed members who entered the uniformed services 
prior to December 7, 1956, to believe they would be 
entitled to fully paid lifetime health care upon retire-
ment. 
(3) In the United States Court of Appeals for 
the Federal Circuit decision of November 18, 2002, 
in Schism v. United States (No. 99–1402), the 
Court said: ‘‘Accordingly, we must affirm the dis-
trict court’s judgment and can do no more than 
hope Congress will make good on the promises re-
cruiters made in good faith to plaintiffs and others 
of the World War II and Korean War era—from 
1941 to 1956, when Congress enacted its first 
health care insurance act for military members, ex-
cluding older retirees . . . . We cannot readily 
imagine more sympathetic plaintiffs than the retired 
officers of the World War II and Korean War era
involved in this case. They served their country for 
at least 20 years with the understanding that when 
they retired they and their dependents would receive 
full free health care for life. The promise of such 
health care was made in good faith and relied upon. 
Again, however, because no authority existed to 
make such promises in the first place, and because 
Congress has never ratified or acquiesced to this 
promise, we have no alternative but to uphold the 
judgment against the retirees’ breach-of-contract 
claim. . . . Perhaps Congress will consider using its 
legal power to address the moral claims raised by 
Schism and Reinlie on their own behalf, and indi-
rectly for other affected retirees.’’. 
(4) Only the United States Congress can make 
good on the promises recruiters made in good faith 
to plaintiffs and others of the World War II and Ko-
rean War era. 
(5) Statutes enacted in 1956 allowed those who 
entered service on or after December 7, 1956, and 
retired after serving a minimum of 20 years or by 
reason of a service-connected disability to medical 
and dental care in any facility of the uniformed serv-
ices, subject to the availability of space and facilities 
and the capabilities of the medical and dental staff.
(6) Recruiters, re-enlistment counselors, and of-
ficers at all levels of the uniformed services, and 
other government officials, as agents of the United 
States Government, continued to allow members who 
entered the uniformed services to believe they would 
be entitled to fully paid lifetime health care upon re-
tirement, despite enactment of statutes in 1956, 
subsequent statutes, and the issuance of regulations 
that defined and limited the availability of medical 
care to retired members of the uniformed services. 
(7) After 4 rounds of base closures between 
1988 and 1995 and further drawdowns of remaining 
military medical treatment facilities, access to 
‘‘space available’’ health care in a military medical 
treatment facility is difficult or virtually nonexistent 
for many military retirees. 
(8) The failure to provide adequate health care 
upon retirement is preventing the retired members 
of the uniformed services from recommending, with-
out reservation, that young men and women make a 
career of any military service. 
(9) Although provisions in the Floyd D. Spence 
National Defense Authorization Act for Fiscal Year 
2001 (as enacted into law by Public Law 106–398) 
extended coverage under the TRICARE program to
medicare eligible military retirees age 65 and older, 
those provisions did not address the health care 
needs of military retirees under the age of 65. 
(10) The United States should make good on 
the promises recruiters made in good faith in the 
World War II and Korean War era and reestablish 
high quality health care for all retired members of 
the uniformed services. 
SEC. 3. COVERAGE OF MILITARY RETIREES UNDER THE 
FEDERAL 
EMPLOYEES 
HEALTH 
BENEFITS 
PROGRAM. 
(a) COVERAGE FOR RETIREES AND DEPENDENTS.—
(1) Section 1108 of title 10, United States Code, is 
amended to read as follows: 
‘‘§ 1108. Health care coverage through Federal Em-
ployees Health Benefits program 
‘‘(a) FEHBP OPTION.—The Secretary of Defense, 
after consulting with the other administering Secretaries, 
shall enter into an agreement with the Office of Personnel 
Management to provide coverage to eligible beneficiaries 
described in subsection (b) under the health benefits plans 
offered through the Federal Employees Health Benefits 
program under chapter 89 of title 5. 
‘‘(b) ELIGIBLE BENEFICIARIES; COVERAGE.—(1) An 
eligible beneficiary under this subsection is—
‘‘(A) a member or former member of the uni-
formed services described in section 1074(b) of this 
title; 
‘‘(B) an individual who is an unremarried 
former spouse of a member or former member de-
scribed in section 1072(2)(F) or 1072(2)(G); 
‘‘(C) an individual who is—
‘‘(i) a dependent of a deceased member or 
former member described in section 1076(b) or 
1076(a)(2)(B) of this title or of a member who 
died while on active duty for a period of more 
than 30 days; and 
‘‘(ii) a member of family as defined in sec-
tion 8901(5) of title 5; or 
‘‘(D) an individual who is—
‘‘(i) a dependent of a living member or 
former member described in section 1076(b)(1) 
of this title; and 
‘‘(ii) a member of family as defined in sec-
tion 8901(5) of title 5. 
‘‘(2) Eligible beneficiaries may enroll in a Federal 
Employees Health Benefit plan under chapter 89 of title 
5 under this section for self-only coverage or for self and 
family coverage which includes any dependent of the mem-
ber or former member who is a family member for pur-
poses of such chapter. 
‘‘(3) A person eligible for coverage under this sub-
section shall not be required to satisfy any eligibility cri-
teria specified in chapter 89 of title 5 (except as provided 
in paragraph (1)(C) or (1)(D)) as a condition for enroll-
ment in health benefits plans offered through the Federal 
Employees Health Benefits program under this section. 
‘‘(4) For purposes of determining whether an indi-
vidual is a member of family under paragraph (5) of sec-
tion 8901 of title 5 for purposes of paragraph (1)(C) or 
(1)(D), a member or former member described in section 
1076(b) or 1076(a)(2)(B) of this title shall be deemed to 
be an employee under such section. 
‘‘(5) An eligible beneficiary who is eligible to enroll 
in the Federal Employees Health Benefits program as an 
employee under chapter 89 of title 5 is not eligible to en-
roll in a Federal Employees Health Benefits plan under 
this section. 
‘‘(6) An eligible beneficiary who enrolls in the Federal 
Employees Health Benefits program under this section 
shall not be eligible to receive health care under section 
1086 or section 1097. Such a beneficiary may continue 
to receive health care in a military medical treatment facil-
ity, in which case the treatment facility shall be reim-
bursed by the Federal Employees Health Benefits pro-
gram for health care services or drugs received by the ben-
eficiary. 
‘‘(c) CHANGE OF HEALTH BENEFITS PLAN.—An eli-
gible beneficiary enrolled in a Federal Employees Health 
Benefits plan under this section may change health bene-
fits plans and coverage in the same manner as any other 
Federal Employees Health Benefits program beneficiary 
may change such plans. 
‘‘(d) GOVERNMENT CONTRIBUTIONS.—The amount 
of the Government contribution for an eligible beneficiary 
who enrolls in a health benefits plan under chapter 89 of 
title 5 in accordance with this section may not exceed the 
amount of the Government contribution which would be 
payable if the electing beneficiary were an employee (as 
defined for purposes of such chapter) enrolled in the same 
health benefits plan and level of benefits. 
‘‘(e) SEPARATE RISK POOLS.—The Director of the 
Office of Personnel Management shall require health bene-
fits plans under chapter 89 of title 5 to maintain a sepa-
rate risk pool for purposes of establishing premium rates 
for eligible beneficiaries who enroll in such a plan in ac-
cordance with this section. 
‘‘(f) REIMBURSEMENT FOR EXPENSES FOR HEALTH 
CARE SERVICES NORMALLY PROVIDED BY THE DEPART-
MENT OF DEFENSE UNDER TRICARE STANDARD.—The 
Secretary of Defense shall develop and implement a sys-
tem to reimburse an eligible beneficiary who enrolls in a 
health benefits plan under chapter 89 of title 5 in accord-
ance with this section for health care costs incurred by 
the beneficiary that are not paid under the health benefits 
plan but would have been paid by the Department of De-
fense under TRICARE Standard.’’. 
(2) The item relating to section 1108 at the begin-
ning of such chapter is amended to read as follows:
‘‘1108. Health care coverage through Federal Employees Health Benefits pro-
gram.’’.
(b) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on October 1, 2004. 
SEC. 4. REIMBURSEMENT FOR TRICARE PHARMACY BENE-
FITS AT TRICARE NETWORK PHARMACY LEV-
ELS TO CERTAIN MILITARY RETIREES AND 
DEPENDENTS IN HARDSHIP CASES. 
(a) IN GENERAL.—In the case of an eligible person 
who has a certification described in subsection (b), the 
Secretary shall reimburse such person for pharmacy bene-
fits received from a pharmacy that is not a TRICARE 
network pharmacy in the same manner and in the same 
amounts as the Secretary would reimburse such person 
for such benefits received from pharmacy that is a 
TRICARE network pharmacy.
(b) CERTIFICATION.—The certification referred to in 
subsection (a) is a certification from an eligible person’s 
physician—
(1) stating that the person does not have access 
to a TRICARE network pharmacy due to physical or 
medical constraints; and 
(2) meeting such other criteria as the Secretary 
of Defense considers appropriate. 
(c) ELIGIBLE PERSON.—In this section, an eligible 
person is an eligible beneficiary as described in section 
1108(b) of title 10, United States Code who has another 
insurance plan or program that provides primary coverage 
for health benefits.
SEC. 5. WAIVER OF MEDICARE PART B PREMIUM FOR CER-
TAIN MILITARY RETIREES. 
(a) IN GENERAL.—Section 1839 of the Social Secu-
rity Act (42 U.S.C. 1395r) is amended—
(1) in subsection (a)(2), by striking ‘‘The 
monthly premium’’ and inserting ‘‘Except as pro-
vided in subsection (h), the monthly premium’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(h)(1) The amount of the monthly premium for an 
eligible individual enrolled under this part is equal to $0.
‘‘(2) For purposes of paragraph (1), the term ‘eligible 
individual’ means—
‘‘(A) an individual who is entitled to retired or 
retainer pay based upon service in the uniformed 
services (as defined in section 101 of title 10, United 
States Code) that began before December 7, 1956; 
‘‘(B) the spouse (as determined under section 
7703 of the Internal Revenue Code of 1986) of an 
individual described in paragraph (1); and 
‘‘(C) the widow or widower, as the case may be, 
of an individual described in subparagraph (A). 
‘‘(3) With respect to years beginning after the date 
of the enactment of this subsection, the monthly premium 
rate calculated under subsection (a)(3) for individuals en-
rolled under this part who are not eligible individuals 
under this subsection shall be determined without regard 
to benefits and administrative costs attributable to such 
eligible individuals during such years.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to premiums for months begin-
ning with January 2004. The Secretary of Health and 
Human Services shall establish a method for providing re-
bates to eligible individuals (as defined in subsection 
(h)(2) of such section 1839) of any premium penalty paid
by reason of subsection (b) of such section for months on 
or after January 2001.
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