Thursday, January 20, 2011

Military widow: Pentagon demands money from husband's benefit back

By Rich Phillips, CNN
UPDATED: 05:46 AM EST 01.17.11

Brooksville, Florida (CNN) - Freda Green thought the battle was over when her husband returned from the Vietnam War.

But more than seven years after his death in 2003, she says the U.S. Defense Department is demanding she repay more than $41,000 in benefits the government shelled out as part of an insurance policy he paid into.

"They gave me 45 days to pay it back," said Green, 74, who claims the federal government began garnishing her benefit payments when she couldn't pay it all back at once.

"They said 45 days, and two weeks later they started taking it out of my check," she said.

Green says $577 is now being deducted from her military benefit check each month.

The reason: She got remarried last year.

It is a confusing section of a federal law that affects some 57,000 military spouses -- and their children -- who receive military benefits and are now being forced to pay Uncle Sam back after walking down the aisle again, according to Norb Ryan, a retired Navy vice admiral and president of the Military Officers Association of America.

"Here we are taxing the groups that have done the most for this country," said Ryan. "If I were in the Pentagon, I'd be awfully embarrassed by this situation."

A Pentagon spokesman declined to comment on Green's case.

Green's first husband, Jerry, a 33-year Air Force veteran who served during World War II, Korea and Vietnam, elected to pay monthly premiums on an insurance policy for supplemental survivor benefit coverage, she said.

The program is a Department of Defense plan, similar to an annuity, that provides the benefit to the surviving spouse.

When her husband died from heart and lung problems that the Air Force determined were military-related, Green had to choose between collecting his pension or a separate monthly benefit from the Veterans Administration.

She chose the latter.

In addition to the monthly benefit, the Pentagon sent her more than $41,000 from the government-sponsored insurance policy her husband purchased.

Green said she received the lump-sum check shortly after his death.

It prompted her to call the Defense Department for an explanation, she said.

"I called Air Force finance, and they said, 'No. That's your money.' I was afraid the money wasn't mine and they made a mistake."

The letter from the Air Force reads: "Because Jerry died from 100 percent service connected disabilities, all of the money he paid for survivor's benefits is to be refunded."

"That's what they told me," she recalled.

Green said she then cashed the check, paying more than $6,000 in taxes.

In 2009, a federal judge ruled survivors could get both of the original benefits if they remarry after the age of 57.

Green -- who was remarried last April -- then became entitled to collect her husband's pension in addition to the separate Veterans Administration benefits.

Uncle Sam is now paying both, but wants the $41,000 back from the supplemental insurance policy, plus 6% interest -- all because of her marriage.

A bill that Rep. Joe Wilson, R-South Carolina, introduced last week is meant to fix the issue.

"A cost of war is not just guns and ammunition and tanks and airplanes," said Sen. Bill Nelson, D-Florida. "A cost of war is taking care of veterans and also taking care of the deceased service members widows, widowers, and orphans."

The issue may be cost.

In congressional testimony, Pentagon officials have opposed eliminating the offset because they believe it would create an inequity as some spouses would receive two benefits while others would receive only one.

Ryan said it will cost more than $600 million each year to fully cover all 57,000 remarried military spouses.

"The military gave her the money back when he died," said Suzanne Gerstner, a spokeswoman for Gold Star Wives of America, a nonprofit organization dedicated to helping military widows. "Now they want it back."

Gerstner also said it is unfair that Green, and others like her, have to repay the full amount, including the $6,000 she lost in government taxes.

"She paid taxes (and) she's going to pay taxes again," Gerstner said. "This isn't right under anybody's book."

Green says Congress needs to change the law.

"They need to fix it now," she said, saying she feels as though Pentagon and elected officials are "waiting for the military widows to die off.

http://mw.cnn.com/snarticle?c=cnnd_us&p=0&aId=20110115:florida.military.widow:1

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