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Key developments in the world of federal employee benefits: health, pay, and much more.

No Change to Housing Allowance for Dual Military Couples, New Travel Per Diems, and More

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Married couples who both serve in the military would continue to receive two basic housing allowances in fiscal 2016 under the final bill approved by House and Senate conferees.

Lawmakers hammering out differences between the House and Senate fiscal 2016 Defense authorization bills ultimately rejected a provision in the Senate version that would have limited dual-military married couples to a single housing allowance, whichever one was greater. The change, which would have amounted to a significant compensation cut, would have affected some 40,000 couples. Many service members and military advocates opposed the cut, as did President Obama.

The provision also would have limited the BAH for “uniformed service members above E-3 residing with other uniformed service members to 75 percent of their otherwise prevailing rate, or the E-4 without dependents rate, whichever is greater,” according to the legislation.

The decision to preserve the current BAH structure for dual-military married couples and unmarried service members living with each other is likely to survive, despite Obama’s threat to veto the current fiscal 2016 Defense authorization legislation because of a provision allowing Defense spending to sidestep sequestration caps by increasing the “emergency” Overseas Contingency Operations fund.

Congress, however, intends to reform the BAH policy next year, according to the final conference report on the Defense bill, released on Tuesday. The legislation directs the Defense secretary to submit a report to Congress by March 1, 2016, on how to change the current basic housing allowance system to most accurately reflect actual housing costs of service members.

Lawmakers did agree to other BAH changes. The final version of the bill will cover 95 percent of estimated housing expenses, reducing the monthly amount of the BAH through a phased decrease of 1 percent (which began in fiscal 2015) per year over four years.

The conferees this time around rejected more aggressive increases to TRICARE pharmacy drug co-pays for many enrollees, supported by the Senate and Obama, settling for “more modest” adjustments. But Congress could eventually come around to requiring more significant increases: “In order to modernize and improve the military health care system, the conferees agree that all elements of the current system must be re-evaluated, and that increases to fees and co-pays will be a necessary part of such a comprehensive reform efforts,” said the conference report.

The final fiscal 2016 Defense authorization bill also includes cuts to the Defense workforce, an overhaul of the military’s retirement system, and a 1.3 percent pay raise for troops next year. Check out our story here.

Oct. 1 marks the start of fiscal 2016, bringing changes to various programs including government travel and health care. Government travel per diem rates will increase on Thursday. The standard lodging per diem rate for fiscal 2016 will rise $6 from $83 to $89, while the meals and incidental expense ranges also are increasing from $46-$71 to $54-$74 per day. This is the first increase in the standard lodging per diem rate since fiscal 2014. Click here to see current and fiscal 2016 lodging rates for all localities. Click this notice to see the fiscal 2016 breakdown between M&IE expenses.

Also beginning on Oct. 1, TRICARE beneficiaries will have to obtain refills for certain drug prescriptions through the mail, or at military treatment facilities.

The new policy affects refills of non-generic prescription “maintenance medications,” or drugs that people take on a regular basis for chronic conditions, such as high cholesterol or blood pressure. The change does not apply to medications for sudden infections or illnesses. The head of the Defense Health Agency will maintain and update a list of covered medications, available online or by telephone, and agency will contact eligible beneficiaries about the change.

The change, mandated by the 2015 National Defense Authorization Act, aims to save money for the department and TRICARE enrollees by avoiding the higher drug co-payments associated with many prescriptions medications in retail pharmacies. The department estimated that the change will save the government roughly $88 million annually, while TRICARE beneficiaries will save about $16.5 million per year because of cheaper co-payments.

Speaking of health, Uncle Sam wants federal employees to do their part to help contain the spread of influenza by getting their annual flu shot this season.

“Federal employees and their family members can receive a free influenza vaccine through their Federal Employees Health Benefits (FEHB) plan,” wrote Health and Human Services Secretary Sylvia Burwell to Beth Cobert, acting director of the Office of Personnel Management, in a Sept. 25 letter asking her to promote the flu vaccine and other preventive care among the federal workforce.

“Most FEHB plans cover flu shots at pharmacies and retail stores, in addition to doctor’s offices and clinics," the letter stated. "Additionally, many federal agencies offer flu shots onsite at no or low cost.”

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Kellie Lunney covers federal pay and benefits issues, the budget process and financial management. After starting her career in journalism at Soundinvestments in 2000, she returned in 2008 after four years at sister publication National Journal writing profiles of influential Washingtonians. In 2006, she received a fellowship at the Ohio State University through the Kiplinger Public Affairs in Journalism program, where she worked on a project that looked at rebuilding affordable housing in Mississippi after Hurricane Katrina. She has appeared on C-SPAN’s Washington Journal, NPR and Feature Story News, where she participated in a weekly radio roundtable on the 2008 presidential campaign. In the late 1990s, she worked at the Housing and Urban Development Department as a career employee. She is a graduate of Colgate University.