Military families and retirees may soon have only one health care plan option and higher out-of-pocket fees under a controversial new Defense Department budget proposal that would combine Tricare Prime, Extra and Standard into one program.
"As we went through the various reviews last year, one of the things that became very obvious was the need to go back through the military pay and compensation package," said Lt. Gen. Mark Ramsay, resources and assessments joint staff director. "We have taken a very clean sheet look at this ... and we're going to submit a single simplified Tricare plan."
The new plan would end the trio of current Tricare programs starting Jan. 1, 2016. All users under age 65 would instead be forced into a consolidated Tricare health cost-sharing plan similar in fee structure to the current active-duty Standard program.
The fee increases and consolidation plan are part of a larger $495.6 billion fiscal 2015 budget package. The health care changes look to save $9 billion between 2015 and 2019 by increasing co-pays to "encourage members to use the most affordable means of care," the proposal states.
While active-duty service members would still receive free health care, all other users would see increased costs for care outside military treatment facilities based on military paygrade, as well as some new out-of-pocket costs for care in them.
All non-medically retired retirees under age 65 along with their families and retiree survivors will also be forced to pay an annual enrollment fee of $286 for individuals or $569 for families under the new proposal or forfeit coverage for the year. That is slightly higher than the current Tricare Prime annual retiree fees of $260 for individuals and $520 for families. But unlike the current fee, the new enrollment cost would apply to all retirees who wish to use Tricare for health coverage.
Another change would be the cost of non-preventive care visits to primary care doctors. Under the current plan, active-duty family member Tricare Standard users pay a cost share per visit of 15 percent. Under the proposed changes, those visits would cost active-duty family users in paygrades E-4 and below a set price of $10 and those of higher paygrades $15. Primary care visits to military treatment facilities would continue to be free.
For retirees, visits to a primary care manager at a military treatment facility would cost $10 per visit, while they would pay $20 for an in-network civilian provider. Under the current plan, all military treatment facility visits are free.
If active-duty family or retiree beneficiaries choose to use an out-of-network provider, they would pay a cost share of 20 and 25 percent respectively of what the provider charged Tricare, under the new proposal.
Annual deductibles and catastrophic caps -- the most a user would have to pay out of pocket -- will also go up under the new proposal. Currently, the catastrophic cap is $1,000 for active-duty families and $3,000 for retirees. The new plan would raise it to $2,500 and $5,000 respectively. Deductibles, which are now up to $300 per family depending on paygrade, would go up to as much as $600.
Tricare users 65 and older would continue to have access to Tricare for Life under the proposal, but would have a new enrollment fee of at least .5 percent of their military retiree pay, but no more than $150 or $200 for retired flag officers starting in 2015. That fee would go up each year until it reached 2 percent of their pay but no more than $614 or $818 for retired flag officers in 2019.
Civilian pharmacy fees would also go up. Costs for generic drugs, which are now set at $5 for a one-month supply, would rise to $14 by 2024. And brand-name drugs, which currently cost $17, would go up to $45.
Using the mail order pharmacy would also start to cost users more. Currently, generic drugs are free by mail. But by 2024, they will cost $14 per three-month supply. And mail order brand-name drugs, which currently $13, will go up to $45.
Filling prescriptions at military treatment facilities would continue to be free.
"Even with additional fees, the coverage is far cheaper than equivalent civilian sector health care plans, and the care will remain comparable to or better than the civilian sector," the proposal said.
Before going into effect, however, the plan must get past Congress, which could prove to be a major hurdle. In years past, lawmakers have avoided raising healthcare fees for military families and retirees, despite the skyrocketing costs. Choosing to dismiss the Tricare changes as well as the other benefit changes included in the proposal would leave a $2.1 billion budget shortfall for 2015, officials said.
"I think that many on the Hill realize that we need a balanced package here. We don't particularly want to do this either, at least some parts of it," said Robert Hale, the DoD's comptroller. "If we don't want to live with these caps ... we've got to do a variety of others things. I think there's a realization of that but I understand it's tough."
Update: A previous version of this article misstated the cost of mail order pharmacy fees under the current plan and new proposal. By 2024, generic drugs will cost $14 per three-month supply.
-- Amy Bushatz can be reached at email@example.com.