The Defense Department, working hard with Congress for the past several months, has reached some conclusions about how the fee system for military health care should be changed, a top DOD official said here May 11.

"It's universally agreed that there is a serious issue, a serious problem, with the growing health care costs within the Department of Defense, and the potential adverse impact that that might have to sustain our great health benefit," said Dr. William Winkenwerder Jr., assistant secretary of defense for health affairs.

DOD has had a lot of good, transparent dialogue with members and committees of Congress, along with beneficiary organizations, Dr. Winkenwerder said. There has been emerging agreement in some areas, specifically in the area of pharmacy costs. All parties agree that changes need to be made in the pharmacy co-payment system, and DOD has received some good feedback to modify its proposal, he said.

Congress is debating DOD's proposed Tricare fee adjustments as part of the Fiscal Year 2007 National Defense Authorization Act.

A persistent rumor that the increase in Tricare fees for military retirees will eat up 50 percent of their cost-of-living allowance is not true, Dr. Winkenwerder said. He said that the increases in Tricare fees will be dramatically less than the increases in retiree pay.

All the senior DOD and military leaders support the Tricare fee increase as a necessary means to sustain the military health care system, Dr. Winkenwerder said. The chairman and vice chairman of the Joint Chiefs of Staff, all the service chiefs of staff, vice chiefs of staff, and surgeons general wrote a letter to Congress supporting DOD's efforts and asking Congress to work with the department, he said.

"Within the department, there's almost universal agreement about the problem and the proposal," he said. "But having said that, it's important that members of Congress and others get a comfort level or some level of agreement about what we're doing, and that we move forward together."

Changes to the Tricare fee system are essential if the military is going to sustain its health benefit at the current level, Dr. Winkenwerder said. Unless financing continues to flow into the system now and in the future, it will be impossible to keep up the quality of care the military has grown accustomed to, he said.

"Something's gotta give; so, unless you can have that financing coming in, we're concerned that the system would really run into trouble," he said. "That's why taking action now or in the very near future is important, and waiting two years or beyond would not be a good idea, because it just makes the problem harder to solve."

Dr. Winkenwerder and other DOD officials have said that if the fee system is not changed, the health system will take up 12 percent of the DOD budget, at $64 billion, by 2015.

The discussion so far about the Tricare fee increases has been spirited and heartfelt, but always professional, Dr. Winkenwerder said. A lot of good ideas have been exchanged, he said, and he is confident about the future.

"We're optimistic about being able to make changes over the next months and into next year that would be the right thing to do and certainly very important to do," he said.