I have no way to verify that and he said he can't give me any details but they were using the new stuff already when he was still in. Part of his job was putting the gps receivers and radios in military vehicles, setting up the encryption keys and such so I would think he knows whats hes talking about.
My understanding is that military GPS uses two separate signals sent on two separate frequencies. One of those signals is encrypted.
Civilian GPS uses only the un-encrypted signal.
In the atmosphere, the signal will follow a path that deviates somewhat from a straight line. That deviation is somewhat different for those two frequencies. Comparing the two can give you much better accuracy than just using one channel. It also has the added benefit that you can deliberately reduce the accuracy of the civilian GPS without affecting the military GPS.
The deviation from a straight line in our atmosphere is the main cause of GPS inaccuracy. Systems as WAAS and EGNOS works by transmitting additional information about that deviation. WAAS/EGNOS enhances the accuracy of a civilian GPS from about 10 meters (30') to about 1.5 meters (5').
So - no separate military GPS satelites, but a separate military frequency that is used together with the "free-for-all" civilian frequency.