Update on TRICARE for Veterans

Pressure to reduce military spending continues to trickle through military benefits programs such as TRICARE. As a recent example, retirees eligible for TRICARE for Life (TFL) will face higher outpatient costs at VA hospitals and clinics starting Oct. 1 for healthcare not related to time in service.

A recent audit of TFL payouts found that the government was essentially covering all health costs, even when that care was unrelated to service time causes—and outside the language of TLC policy coverage. Michael O’Bar, deputy chief of TRICARE policy and operations recently announced that TRICARE policy regarding TFL retirees and VA health care will “get back into sync” with statutory requirements

The law that established TRICARE for Life as a prized supplement to Medicare for retirees 65 and older directs TRICARE to cover the cost of TFL claims only after Medicare has paid its share, followed by any other health insurance that retirees might have to serve as second payer.

Some TRICARE Details

  • TRICARE Prime. The current family enrollment fee of $539 for working-age retirees (under age 65) would increase next year to equal 2.95 percent of the individual’s gross retired pay.  But for 2014 the fee would be subject to an annual minimum, or floor, of $548 and a ceiling of $750 ($900 for flag officers).  The fee would be raised to 3.3 percent of gross retired pay in 2015 with a floor of $558 and ceiling of $900 ($1200 for flag); 3.65 percent in 2016 with floor of $569 and ceiling of $1050 ($1500 for flag); and so on until reaching 4 percent of gross retired pay in 2018 with a floor of $594 and ceiling of $1226 ($1840 for flag). Fees for single coverage would be half these amounts.
  • TRICARE Standard/Extra. For the first time, users of these options would face an annual enrollment fee, starting at $70 for single coverage or $140 for family, and rising each year until reaching $125 (individual) and $250 (family) in 2018.  Also, the current annual deductible of $150 (individual) and $300 (family) would gradually increase, starting in 2014 and until it reached $290 (individual) and $580 (family) in 2018.
  • TRICARE for Life. Beneficiaries 65 and older can use TRICARE for Life as a golden supplement to Medicare. Officials said a comparable individual policy in 2009 would cost $2100 in the private sector.  So, they reason, military elderly should at least pay a small enrollment fee. But these changes would be grandfathered to impact only retirees who become TFL beneficiaries after enactment.
    The fee would equal one half of one percentage point of gross retired pay in 2014; one percent in 2015; 1.5 percent in 2016, and two percent in 2017 and in 2018.  But the fees would have ceilings: no more $150 a year in 2014; no more than $300 in 2015, $450 in 2016, $600 in 2017 and no more than $618 in 2018.  Flag officers would face higher ceilings though not substantial. After 2017, these fees would be adjusted by the percentage of retiree COLAs.
  • Pharmacy Fees. The administration wants to follow last year’s increases in pharmacy co-pays with additional increases phased in to encourage greater use of mail order and generic drugs.
  • Catastrophic Cap. The current cap on total out-of-pocket costs TRICARE costs of $3000 a year would be raised for retirees in two ways: by excluding any TRICARE enrollment fees from counting toward the cap; and by raising the cap annually by the percentage of retiree COLA.

Have you checked out the VA eBenefits website? There is some really good information there on TRICARE and other medical benefits for veterans.

Also in this year’s plan survivors of members who die on active duty and persons medically retired from service would be exempt from any fee increases. The department no longer is asking that TRICARE fees be adjusted annually based on medical inflation.

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