I’ve been getting some e-mails, so let me clarify a few health insurance questions before I start the main topic.
Last month the Supreme Court upheld the key provisions of the Patient Protection and Affordable Care Act that have attracted so much media attention over the last year. (Careful, that link opens the bill’s 906-page PDF.) However, none of this has any short-term effect on Tricare or VA beneficiaries. As part of the negotiations, Congress passed legislation specifically exempting Tricare and VA beneficiaries from being required to participate in pooled coverage and from the risk of being taxed for not having coverage. But if you’re curious about what happens next for those without military benefits, one of the (many) media references is this summary of where each state stands on implementation.
(I’m not planning to start any new blogs. But if I was, I’d buy a PPACA URL and show ads from health insurers, doctors, & lawyers. You entrepreneurs can run with that idea.)
One feature of PPACA includes coverage of young adults up to age 26. When the FY2011 National Defense Authorization Act was passed a few months after PPACA, Congress also required DoD to implement Tricare Young Adult. It’s available to family members who are under the age of 26, unmarried, and not eligible for their own employer medical coverage. In the last 18 months, more than 17,000 people have signed up for TYA— in addition to the existing 9.7 million Tricare beneficiaries. (TYA does not include dental insurance.) To learn more, go to the Tricare Young Adult website.
Finally, there’s still a long list of Tricare issues to be addressed. Medicare and Tricare reimbursements have driven away many physicians, and their rates are constantly being “fixed” at the last minute by Congress. There may be major Medicare cuts over the next decade which will also impact Tricare, especially beneficiaries of Tricare For Life. DoD is still proposing annual enrollment fees for TFL, although Congress does not agree.
This fiscal brinkmanship is a perpetual battle between the executive and legislative branches. Some years gain more media attention than others, and the impending possibility of sequestration casts a long shadow over election-year politics. However, the controversy will never end. DoD will always be trying to shift more medical expenses onto beneficiaries (especially retirees) and other health insurers. Congress will usually be opposed to DoD’s recommendations and more attentive to their constituents. If you find this drama upsetting, then I’d recommend that you join a military support organization like MOAA and that you tell your Senators and Representative how you feel. You’ll be “doing something” instead of worrying about being at the mercy of special-interest groups.
I hope this answers the questions– but if you have more then please post them below or “Contact me” or send me an e-mail!
(We now return you to your regularly scheduled blog post.)
Last year Congress supported DoD’s request to raise Tricare enrollment fees. Veteran’s organizations generally supported this compromise because Tricare fees had not been raised in 15 years, and because the rate of future fee hikes would be tied to the same cost of living adjustment that military retirees receive in their pensions. DoD initially proposed linking Tricare fee hikes to the rise in the medical index of inflation, which has been running at about 6%. Veteran’s groups threw their support behind Congress for an increase tied to the retiree COLA. Their support was reluctantly given to a compromise that controls the rate of future Tricare fee hikes because 15 years of legislative gridlock had nearly led to much higher fees.
The first fee increases took effect last October for new retirees. Those who were already retired before last October will see the increases take effect this coming October. However, it’s also the first year that the cost of living increase kicks in, so most retirees will see both a fee increase and a COLA fee tacked on to that.
The tables in the Tricare enrollment fee announcement boil down to this: starting October 2012, most individuals will pay $269.28 per year and most families will pay $538.56 per year for Tricare Prime. Survivors of active-duty deceased sponsors, and medically-retired servicemembers will be exempt from the enrollment fee increases. Depending on their retirement date, these individuals could pay as little as $230/year and families could pay as little as $460/year. There are other fee increases for Tricare pharmacy costs, and of course Tricare dental insurance is a separate program.
It’s possible that Congress could add more Tricare charges to the FY2013 budget, but otherwise the fees will automatically rise each October by the percentage of the retiree COLA.
If you’re planning to complain about broken promises and eroded benefits, I’d advise you not to do this around civilians or even Reserve/Guard servicemembers. I’ve spent a lot of time reading about financial independence and early retirement, and it’s common for civilian health insurance to cost hundreds of dollars per MONTH. Tricare fees seem ridiculously cheap compared to the civilian equivalent. We veterans have paid for it (some with much greater sacrifices) and we’ve earned it, but all that most people see is the price tag.
Whether you earn a military retirement or not, your financial independence is tied to affordable health insurance. For now, military retirees should be able to project that expense to grow with inflation. For veterans without a pension, the key will be a healthy lifestyle and PPACA’s efforts to control premiums. You’ll also want to consider a high-deductible catastrophic insurance policy and medical tourism.
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