Guardsmen, Reservists Will Get Full Insurance Benefits
By Rudi Williams
American Forces Press Service
WASHINGTON, Jan. 29, 1997 The mobilization insurance program has problems, but beneficiaries will be paid, misleading news reports to the contrary, said DoD spokesman Air Force Maj. Tom Schultz.
"People who have signed up and are due benefits will eventually be paid in full," Schultz said. "There is a shortfall of funds, so for the time being, they're being paid a temporary prorated 4 percent of their benefits. No matter what happens, DoD and Congress are committed to working together on this problem."
Deborah Lee, assistant secretary of defense for reserve affairs, said DoD is asking Congress to approve a $72 million special appropriation to cover the insurance fund until the end of fiscal 1997. "They will get the full payment down the road," Lee emphasized. "We want to get the word out to as many troops as possible. Yes, we've had a tough start, but we're going to make sure they get their benefits -- partial benefits on time and the balance as soon as we have it worked through Congress."
Mobilization insurance costs $12.20 per $1,000 worth of coverage, Lee said. A reservist can choose coverage from $500 to $5,000 per month, and insurance kicks in if the member is involuntarily activated. The insurance doesn't cover volunteers.
The Ready Reserve Mobilization Income Insurance Program went into effect Sept. 30, 1996 and is supposed to be self-sustaining -- that is, contributions cover the benefits, Lee noted. She said the start-up has been difficult because of the low enrollment and the timing of the call-up for Bosnia.There has been little time to build a fund.
"As a result, we owe more money each month than we have coming into the fund," Lee noted. "But we're taking quick action to remedy the situation. If the troops will be patient with us, they will get paid. We are going to get it resolved as quickly as possible."
The plan covers only those under current or future involuntary presidential call-ups, Lee noted. "Which, at this time, means guardsmen and reservists participating in Joint Guard," she said. "There was no involuntary call-up for Zaire."
Personnel currently serving in the Selected Reserve were notified in October and November and given 60 days to enroll. "If they decline coverage, they won't get another chance to opt in unless Congress allows another open enrollment period in the future," Lee said.
New personnel joining the Selected Reserve get 60 days from the first day of the first full month after the member is first notified or the member is automatically enrolled for coverage.
Schultz pointed out participants don't receive benefits the first 30 days they're on active duty. The plan kicks in the second month, and if they work only a portion of the month, they'll get a partial payment.
Lee said surveys of reserve component personnel after the Persian Gulf War ended revealed about two-thirds of the nearly 268,000 reservists activated for the conflict suffered economic loss. DoD officials were also concerned about the effect this would have on retention as the military services increase their use of the reserve components.
"We discovered that between 60 and 70 percent reported they'd suffered substantial or severe income loss when they left their civilian occupation and went off to the conflict for a year or more," Lee said.
"That's a quality of life issue, and that's why we got involved and why we care about the program," Lee noted. "We've worked very hard to implement mobilization insurance because we consider it to be an important quality of life initiative for reservists, who are being asked to do more in the post-Cold War era."
Reserve and National Guard members should look at this insurance as a long-term career decision before choosing how much coverage to take. They should consider their income earning potential and the future impact on their families if they are called up, according to Schultz.
"Once a guardsman or reservist picks a certain amount of coverage, the law doesn't allow them to increase the amount as their income rises. For example, an E-2 picks the lowest level of coverage, then in five or 10 years the service member is an E-7. On the civilian side, that same person moves from an apprentice to a journeyman position. He or she would have inadequate coverage."
The military's dependence on the reserve component personnel means there is a strong possibility reserve component members will be called up in the future, therefore they should consider the insurance program over the long haul, Lee said.