One big part of that adjustment will be regarding people and how they will be compensated, Mullen said.
Mullen emphasized there are no current plans to change the retirement system.
Health care costs have risen from $19 billion to $51 billion over the past decade, and personnel costs have increased 80 percent over the past decade.
“There are going to have to be some changes,” Mullen said. “The challenge is to do it in a balanced and fair way.”