Air Force News

Col Mike Lee, USAF

We seemed to race past midterm and before you know it the campus will be quiet again for a month as we send our cadets home for Christmas Break. AF cadets attended an AF birthday celebration at the Air Museum in Topeka in September, went canoeing in October (to see if the Navy had it right) and then decided to try rappelling during the heaviest rainfall in months to see why the Army enjoys the mud so much. We "re-blued" by visiting Vance Air Force Base and planning a B-2 Stealth Bomber fly-over from Whiteman AFB for the 8 Nov Nebraska-KU football game. If the bomber can't make it, we've recorded "jet noise" to play over the PA system, and we'll just announce that the Stealth Bomber's flying by . . . no one will know the difference!

We started into mandatory fitness training three (3) times a week as part of an overall push by the USAF to improve fitness levels for all members, active and reserve. That puts us out on the roads of KU and Lawrence a little more and doubles our contact time with most of our younger cadets. It also increases the pedestrian flow through areas around the

University in the dark hours of the morning. Some of our cadets think they're becoming nocturnal animals . . . some skunks on campus apparently don't like the competition.

The Arnold Air Society, our national "social organization" recently decided to interview and record the stories of American Veterans in support of the Congressionally-mandated Veteran's History Project. Every day, 1500 Vets pass away, and Congress decided it was essential to record their stories. We know MOAA is a great source, and we hope that some of you might be willing to sit and tell some old war/sea stories to be recorded for the nation's posterity. Our cadet in charge of this project is C3C Mallare. Anyone willing to share some history can contact the AFROTC office at 864-4676, and we'll get the details to Mallare, who will then contact you.

Col Mike Lee

MOAA Legislative Updates - October 2003

Legislative Update for Friday, October 3, 2003:

Issue 1: Senate OKs Reserve Health Care Amendment. The Senate version of the Iraq supplemental appropriations bill will include authority to provide TRICARE benefits on a cost-share basis to National Guard and Reserve members who don't have employer-sponsored health insurance.

Legislative Update for Friday, October 10, 2003:

Issue 1: On Concurrent Receipt, Smoke But No Fire...Yet. Various media reports have been circulating the details of a purported concurrent receipt compromise. While we think something significant will be done this year, reports of specific numbers are premature speculation.

Issue 3: Food Charges Nixed for Hospitalized Wounded. Congress appears close to passing a measure that would permanently prohibit military hospitals from charging combat-wounded troops for the cost of their food while hospitalized.

Issue 2: Veterans Benefits Legislation Update

On Wednesday, the House unanimously approved H.R. 2297, an omnibus veterans benefits bill that had been approved by the House Veterans Affairs Committee in June. The bill authorizes continuation of the VA survivor annuity (Dependency and Indemnity Compensation, or DIC) for qualifying survivors who remarry after the age of 55. DIC is paid to survivors of members who died of service-connected causes. This would bring DIC into alignment with the rules for every other federal survivor program -- a long-sought goal of MOAA and The Military Coalition.

* S.1132, the Veterans' Survivors Benefits Enhancement Act of 2003. This bill would raise educational assistance rates for surviving spouses and dependents of veterans who died of service-related causes and authorizes 45 months (vs. 36 months) of eligibility; increase the DIC rate by $250 for qualifying surviving spouses with one or more children under age 18; and make surviving spouses eligible for burial in a national cemetery; among other provisions;

* S.1156 would expand the requirement for the VA to provide nursing home care to veterans who have service connected disabilities rated at 50% or higher (currently 70% or above);

Legislative Update for Thursday, October 16, 2003:

Issue 1: Final COLA Update. Federal annuitants will see an adjustment of 2.1 percent for the coming year.

Issue 2: Legislators Announce Concurrent Receipt Deal

House Majority Whip Roy Blunt (R-MO), Armed Services Committee Chairman Duncan Hunter (R-CA), Veterans Affairs Committee Chairman Chris Smith (R-NJ) and concurrent receipt champion Rep. Mike Bilirakis (R-FL) met with MOAA and other military and veterans' associations today to announce a final concurrent receipt agreement with Senate leaders and the White House.

The proposal will benefit as many as 200,000 disabled retirees in two ways:

* First, all retirees with at least 20 years of service and VA disability ratings of 50% or higher will see their military retired pay offsets phased out over a ten-year period starting January 1, 2004.

* Second, the recently enacted Combat Related Special Compensation (CRSC) will be expanded to include all combat- or operations-related disabilities-from 10% to 100% ratings, also effective January 1, 2004. Currently, only those with qualifying disabilities rated 60% or higher or who have a disability associated with a Purple Heart are eligible.

In both cases, Guard and Reserve retirees with 20 qualifying years of service (including those with less than 7,200 retirement points) will be eligible.

Disabled retirees rated 50% and higher who do not elect CRSC payments should start seeing their retired offset phased out automatically, starting January 1, 2004. No application is expected to be required. For 2004, qualifying retirees should see their retired pay increase by a flat amount, depending on disability, as follows:

$750 for 100% disabled;

$500 for 90%;

$350 for 80%;

$250 for 70%;

$125 for 60%; and

$100 for 50%.

The remaining retired pay offsets would then be phased out over the following nine years. In 2005, they would get back another 10% of any remaining offset; in 2006, they would get back 20% of the remaining offset; in 2007, 30% of the remaining offset; and so on. By January 2014, disabled retirees with 50% and higher ratings will be entitled to full concurrent receipt of military retired pay and VA disability compensation.

Disabled retirees who qualify for both programs would have to choose one or the other. Because the CRSC program provides full payment immediately vs. the 10-year phase-in for concurrent receipt, legislators plan to allow an annual election option for CRSC-eligibles. This recognizes that a retiree who is 100% disabled, but only 60% of that is due to combat-related conditions, may find it advantageous to elect full CRSC payments for a few years until the concurrent receipt payment rises to a level that exceeds the CRSC payment. Because CRSC payments are tax-free and nondisability retired pay is not, this could also figure into qualifying retirees' election decisions.

Legislative Update for Friday, October 24, 2003:

Issue 1: No More Foot-Dragging on Military Tax Fairness. MOAA joined Rep. Chet Edwards (D-TX) at a press conference calling for an end to congressional leaders' foot-dragging on the Armed Forces Tax Fairness Act. MOAA has been running radio ads this week urging an immediate end to tax discrimination against service members and survivors.

Issue 2: Iraq Supplemental Must Address Troop Needs

In a letter to key House and Senate negotiators today, MOAA and The Military Coalition (TMC) said the final version of the $87 billion Iraq Emergency Supplemental funding measure should:

* Allow National Guard and Reserve service members the option of year-round TRICARE coverage on a cost-share basis, or federal payment of a share of the premium for their private health policies (similar to current policies for DoD civilians who are reservists); and extended post-deployment coverage under TRICARE.

* Increase the Army's end strength by 10,000. With three-quarters of the Army's brigades deployed and two more National Guard brigades being mobilized, it's time to face the fact that the Army has reached the breaking point and must be reinforced. The Senate bill includes the manning plus-up.

* Provide an additional $1.3 billion in funds to the VA health care system to care for wounded and ill returning veterans.

* Authorize funding to support the National Guard family readiness program. TMC urged the conferees to add funds for the other reserve components' family readiness programs as well.

*Authorize leave from civilian employment under the Family and Medical Leave Act so that certain family members can attend to deployment-related family matters while the military spouse is away.

1. CRSC Update: Processing Won't Be Quick

As was reported in last Friday's Legislative Update, our discussions with the Military Services have convinced us they're trying their best to process thousands of Combat-Related Special Compensation (CRSC) applications as quickly as possible. But the work is going more slowly than they had hoped, often requiring detailed reviews of medical files a foot deep.

As of late last week, the Army, with the largest population of disabled retirees, has two dozen people working on processing the 17,234 Army retiree applications received so far. They've approved 1,123 applications; denied 1,042; and are holding another 1,015 for VA medical docu-mentation, which takes an average of 120-180 days to get.

All the Services process applications on a first-in, first-out basis. With 3,500 reviewed, the Army is only 20 percent of the way through applications on hand.

The Air Force has received a total of 6,937 applications, and has approved 584 and denied 546. The Navy has received 6,150 applications, with 520 approved and 236 denied.

The Services would much prefer a cleaner, faster process, but they're hampered by a complex set of criteria that must be substantiated before a case can be approved. Some applications can be approved quickly because they include all necessary documentation, highlighted and tabbed for easy review. But more often than not, the Services have to go to the VA for the member's medical file, which can take more than 4 months to get.

We're not making excuses for the length of time it takes to process these applications. We're simply pointing out that the detailed reviews pose major challenges for Service and VA administrative systems. Some are in the process of hiring more people, but they weren't funded for any such requirement, and hand review is still hand review.

Our message to CRSC applicants: (a) be patient, (b) don't call the Service to inquire about your case status since this takes time away from the processors, and (c) watch our updates for further information. It's certainly nothing like a perfect process-but the Services are trying, and they're frustrated, too, that it's taking longer than expected.

When we get some solid facts, our Legislative or Benefits Update subscribers will be the first to know.

2. DoD Announces Contract Award For TRICARE Retail Pharmacy Contract

The new retail pharmacy program will be fully portable, allowing beneficiaries access to network pharmacies while traveling outside of their regions. Retail pharmacies comprise one of three venues through which pharmacy services are available. Beneficiaries may also obtain prescription medications from their military treatment facilities and the Tricare Mail Order Pharmacy. The single contract will better serve Tricare beneficiaries, be simpler for the government to administer, and make the program more accountable.

Express Scripts Inc. will inform beneficiaries about network coverage and procedures for filling prescriptions at their neighborhood pharmacies.

3. VA Looking For Former POWs

The Department of Veterans Affairs (VA) is asking former prisoners of war not currently using VA benefits to contact VA to find out if they may be eligible for disability compensation and other services.

The VA has expanded policies to cover increasing numbers of former POWs as new illnesses have been found related to captivity. The VA is asking former POWs not receiving benefits who did not receive a VA letter recently to call the department at 1-800-827-1000.

Nine out of ten former POWs are veterans of World War II, and their service predates the use of Social Security numbers as a military "service number." That, coupled with the decades that have elapsed since their service, makes it difficult for VA to track down those who have not opened a file with VA in recent years.

The most recent expansion of VA benefits for former POWs was a July regulation that added cirrhosis of the liver to the list of diseases to which entitlement to disability compensation is presumed in former POWs. Similar policies making it easier for former POWs to obtain compensation have been enacted for POWs detained for 30 days or more who develop specific illnesses.

Former POWs have a special eligibility for enrollment in VA medical care and are exempt from making copayments for inpatient and outpatient medical care. They have the same copay rules as other veterans for medications and for extended care. Free dental treatment for any dental condition is available to former POWs held for more than 90 days.

4. TMA Updates Tricare Standard Directory

The Tricare Management Activity has updated their Tricare Standard Provider Directory to provide more streamlined, detailed results; improved search tips and explanation of search results; and added questions frequently asked in searching for a provider who will accept TRICARE. This contributes in the efforts to communicate TRICARE Standard benefits information in an easily accessible, easy to understand format. The Directory can be found at http://www.tricare.osd.mil/standardprovider/

5. DoD Approves Use Of Ceremonial Bugle

The Department of Defense announced today it has approved the use of the ceremonial bugle as an alternative to the recorded version of Taps played on stereo at military funerals.

The ceremonial bugle will be offered to families as an alternative to the pre-recorded Taps played on a stereo, but will not be used as a substitute for a live bugler when one is available. Live buglers will continue to play at veterans' funerals whenever available.

6. Contribute to the MOAA Scholarship Fund through CFC

When you receive your contribution form for the 2003 Combined Federal Campaign (CFC), look for the Military Officers Association of America Scholarship Fund, #2142. MOAA's Scholarship Fund provides interest-free loans and grants to children of officer and enlisted personnel.

The Fund has helped nearly 7,500 students achieve their dream of a college education since it was established 55 years ago. 100% of contributions are used for interest-free loans and grants. MOAA pays all operating expenses and overhead costs. More than 99% of the loans are repaid, so your gift is recycled to the next student.

MOAA Member Services Update - October 2003

TRAVEL TIPS -- Airline Shoe Screening Policy

As most frequent travelers know, there doesn't appear to be a standard policy for airports when it comes to screening passengers' shoes. In other words, do I take off my shoes off or leave them on when approaching the screening gate? The following is the latest word from the Transportation Security Administration (TSA) on this subject:

* TSA does NOT require that passengers remove their shoes prior to proceeding through the security checkpoint.

Bottom line: If you think your shoes may set off a screening alert, to save time have your shoes in hand as you approach the security checkpoint.

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D-DAY 60TH ANNIVERSARY TOURS

On June 6, 1944, Allied soldiers changed the course of WWII and world history when 135,000 men and 20,000 vehicles were brought onto the shores of Normandy via five landing beaches. 2004 is the 60th anniversary year of this event.

Plans for this milestone anniversary began over a year ago, when a special committee was established to coordinate and promote the events commemorating the Normandy Landings, the Battle of Normandy and the action of the Resistance.

You can find specific information on the Battle of Normandy and scheduled events at www. normandiememoire.com.

If you are considering visiting this historic area, make sure your plans include a visit to the Caen Memorial and guided tours of the D-Day Landing Beaches. A one-day pass allows you to experience both the Memorial and the Landing Beaches with the added benefit of a knowledgeable guide to bring the story of D-Day to life at each point along the way. Reduced fare passes are available for WWII veterans.

Important Note: Make plans for your Normandy trip early to ensure the availability of hotel rooms, tour packages or cruise berths.

Let the Experts at MOAA Vacations Plan Your 60th Anniversary D-Day Trip.

Land Packages - exclusive space held for MOAA members that allows you to be on the beaches on June 5th & 6th.

River Cruises - reserved space with a special 50% discount for MOAA members and 25% discount for their companions.

Holland America Cruise - special block of cabins held for MOAA members on the only major cruise line offering a special D-Day itinerary.

To learn more contact MOAA Vacations at 1-800-211-5107 or visit the website at www. moaavacations.com

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PERSONAL FINANCE by Phil Dyer, CFP

Navigating Through the New Dividend Tax Rules

The 2003 Jobs and Growth Tax Reconciliation Act dramatically decreased the tax rate on most dividends types. Prior to 2003, dividends were taxed at ordinary income tax rates (up to 35%). The new rules reduce the dividend tax rate to 15% for those in the 25%, 28%, 33% and 35% tax brackets, and to only 5% for those below the 25% tax bracket. Due to the "Sunset Provision" in the 2003 Tax Act, dividend rates revert to their 2002 levels in 2009, barring further congressional action.

Dividends received by an individual shareholder from domestic and qualified foreign corporations benefit from the lower rates. A taxpayer in the 28% tax bracket receiving $4,000 in qualified taxable dividends in 2003 realizes a savings of up to $520.

* Old rule: $4,000 x 28% = $1,120

* New rule: $4,000 x 15% = $600

* Savings: $520

Unfortunately, some popular dividends may not qualify for the new rules, including:

* Dividends paid by bond and municipal bond mutual funds

* Dividends paid by some real estate investment trusts (REITs)

* Dividends paid by preferred stock.

If you own these investments in a taxable account, discuss their tax treatment with your investment advisor or tax professional. In addition, interest payments from fixed income investments such as bonds, certificates of deposit and money market funds are still taxed at the higher ordinary income tax rate. This makes it much less attractive to hold interest-bearing investments in taxable accounts.

Phil Dyer, a Certified Financial Planner, is assigned to the MOAA staff as Deputy Director, Benefits Information and will be a regular contributor to this newsletter.

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MOAA Exchange - Your source for distinctive clothing and gifts

Summer clearance sale on MOAA men's and women's golf shirts for $18.20. Our Highland Bay golf shirt is made of 7 oz. ringspun combed cotton. The MOAA logo is embroidered on the left chest. Available in either navy blue or white.

Visit the MOAA Exchange online to see our unique line of merchandise or call 866-663-6622 to place an order.

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MOAA Holiday Card Program

The 2003 MOAA Holiday Card Collection is a perfect way to send greetings to your loved ones and help the children of military personnel receive the education they deserve at the same time. The 2003 Collection of Holiday Cards features distinctive designs by some of the best artists and photographers in the marketplace.

Each box holds 25 cards with envelopes and comes with FREE decorative holiday seals and customized return-address labels. Our quality cards are an excellent value and unconditionally guaranteed.

Why not take this opportunity to order now? Your purchase will help fund our important programs throughout the year. Visit our website at www. holidaycardcenter.org/freera3

Purchase 3 or more boxes by November 5th and you'll receive FREE shipping and handling.

MOAA VACATIONS

Top Ten Deals of the Week!

GREAT RATES - GREAT OPPORTUNITIES

1. Holland America ~ Oceanview staterooms for $399 including port charges!

2. Princess Fall 2003 Panama Canal "10-nights from $599, 15-nights from $899"

3. Princess Fall 2003 Caribbean "7-nights from $399, 10-nights from $599"

4. Royal Caribbean 2004 Balcony Sale ~ The BEST price on the BEST cabin

5. Radisson ~ 2-for-1 Savings! ~ $99 Singles Offer! ~ 3rd Person Free!

6. Freestyle Cruising on Sale ~ Christmas Caribbean, Western Europe & South America.

7. Celebrity Alaska ~ Inside Passage & Glacier Bay cruises for under $1000

8. Steep Savings at SuperClubs Breezes in the Bahamas ~ from $139

9. European River cruises with Brendan Tours

10. Europe cruises ~ Save 41% to 47& PLUS Companion FLIES FREE

All Cruise Prices include Port Charges!

[Last Minute Addition]

Legislative Update for Friday, October 31, 2003:

Issue 1: Conferees Endorse TRICARE for Reserve Forces

Backed by strong bi-partisan support in the Senate and against the vehement objection of the Administration, conferees negotiating the final outline of the $87 billion dollar Iraq Emergency Supplemental spending bill voted this week to allow uninsured members of the National Guard and Reserve to participate in TRICARE on a cost-share basis.

The program funding covers only one year and it remains to be seen if the Defense Authorization conferees will roll up the initiative in the pending National Defense Authorization Act for FY 2004. MOAA strongly recommends this be done. The prospects for success, however, are dimmed by the Administration's threat of a defense bill veto if TRICARE expansion is permanently authorized.

MOAA is particularly grateful to the champions of this initiative for their tireless support. Senators Tom Daschle (D-SD), Lindsey Graham (R-SC), Mike DeWine (R-OH), and Patrick Leahy (D-VT) deserve commendation for their commitment to this initiative. We feel confident that they will lead the charge to extend and improve upon this needed coverage for our nation's citizen-soldiers.

Issue 2: Senator Landrieu to Champion SBP Campaign

In a meeting with VADM Norb Ryan, Jr. last week, Senator Mary Landrieu (D-LA) agreed to be the Senate champion of MOAA's and The Military Coalition's (TMC) fight to increase the SBP benefit to 55 percent after age 62. Sen. Landrieu is a strong supporter of military members and their families and is the sponsor of S. 401 which would raise the SBP benefit to 55 percent.

Letters to be sent to your Representatives and Senators can be found on the MOAA Web site at http://capwiz.com/moaa/issues/bills.