February 13th, 2012
December 17, 2012 Update: According to the DoD, the 2013 BAH amounts are released and will take effect January 1, 2013. That average increase is 3.8%; did yours go up or down? By how much?
13 Feb 2012, President Obama released his “Budget of the United States Government, Fiscal Year 2013.” I have taken the liberty to extract the portion within the Defense budget overview that related to our members and families. For 2013, the information for families is limited as compared to past years.
Cares for Servicemembers and Their Families. Keeping faith with servicemembers—which the President has called a “moral obligation”—is a key component of the new defense strategy. The high quality and readiness of our All-Volunteer Force is the Nation’s most important military advantage, so it is critical that military members and their families receive the compensation and benefits that they deserve. The Budget provides a 1.7 percent increase to basic pay in calendar year 2013, the full increase authorized by current law.
Adjusts Health Care Benefits and Initiates Retirement Review. DOD has implemented a variety of internal efficiencies within its medical program and continues to seek
cost savings, but it is imperative to better manage the health benefit.
The Budget introduces new TRICARE copays and fees to help constrain the cost of healthcare while continuing to provide high quality care. The Budget includes additional increases to TRICARE
Prime enrollment fees, initiation of Standard/Extra annual enrollment fees, and adjustments
to deductibles and catastrophic caps. The Budget also modifies pharmacy copays to encourage
the use of less expensive mail-order and military treatment facility pharmacies. Finally, the
Budget includes modest annual fees for TRICARE beneficiaries over age 65 when they transition
to Medicare coverage. These reforms will reduce DOD costs over five years by an estimated $12.9
billion in discretionary funding and $4.7 billion in mandatory savings in the Medicare-Eligible
Retiree Health Care Fund.
The Budget also includes the Administration’s proposal for a Military Retirement Modernization
Commission, which, if enacted, will recommend improvements to the military retirement
system. Under the proposal, the President would appoint the Commissioners; DOD would transmit
to the Commission initial recommendations to change the military retirement system; the
Commission would hold hearings, make final recommendations, and draft legislation to implement
its recommendations; the President would review and decide whether to transmit the Commission’s recommendations to the Congress; and Congress would vote “up or down” on the legislation. The Administration believes that any major military retirement reforms should include grandfathering for current retirees and those currently serving in the military.
Usually, the budget proposal will make specific reference to housing in the budget summary, but this year it does not. You have to look at the actual budget numbers to get an idea. Will Basic Allowance for Housing (BAH) increase in 2013? If the housing numbers that are being proposed are any indication, the answer is, no. The budget’ housing number reflects a $35 million decrease over the 2012 estimate.
Update: Thank you to the personnel at the Joint Chiefs of Staff for showing me where the BAH infor was described in the budget text! It has a 4.2% raise in BAH and 3.4% raise in BAS for 2013 – interestingly it is the same increase proposed as last years (last years proposal ended up being about two full percent higher than what actually became true).
From the buget proposal:
For the basic allowance for housing (BAH) and basic allowance for subsistence (BAS), the
FY 2013 budget request includes a 4.2 percent average rate increase in BAH and a
3.4 percent increase in BAS effective January 1, 2013. However, the actual increases will
be based on a “by location” housing market analysis conducted for the Department of
Defense and a food cost index prepared by the Department of Agriculture, both of which are
measured much closer to the effective date to ensure they best capture the actual cost
impact on the service member.
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