Military health costs up 300%

Charles Riley | CNNMoney.com | February 28, 2011

The cost of military health care, up 300% in the past decade, is eating a giant hole in the Pentagon's budget, according to a report released Monday by a group of defense experts. The Defense Department expects to spend $52.5 billion on health care in 2012, a 300% increase since 2001, the report says. By 2015, health care will account for 10% of the Pentagon budget.

The eye-popping numbers have set alarm bells ringing inside the Pentagon. The report, from the left-leaning Center for American Progress, lays out a way to cut $15 billion a year from the Pentagon's bloated health care budget. The target: An insurance program called Tricare that accounts for much of the cost increase.

Currently, fees for some of the 9.6 million service members who participate in the program haven't risen since 1995. And enrollees pay rates far below what they would find in the private sector.