Pentagon ‘Struggles’ as TriCare Benefits Extended to Retirees Over 65
The Pentagon is "struggling" to implement changes to the military's managed health care plan, TriCare, after Congress voted 10 months ago to "guarantee free medical coverage" to military retirees with 20 years of service and their spouses, the Los Angeles Times reports. The program will cover most medical expenses without copayments or premiums and also offers a "substantial" prescription drug benefit. Also, beneficiaries will pay no more than $3,000 in annual out-of-pocket expenses, the Times reports. For the drug program, retirees will not pay premiums or copayments, but will pay an annual deductible of no more than $150. Since retirees began enrolling in the drug program in April, the Pentagon has spent more than $100 million for more than 250,000 prescriptions. The Times reports the health plan is "more generous" than any other offered by the federal government. The Defense Department has set aside $3.9 billion to fund the program's first year. Costs have been estimated to top $60 billion over ten years and with the current rate of medical inflation, costs could reach $7 billion annually in five years. Rep. Stephen Buyer (R-Ind.) said, "The Pentagon for years had been, in its decision-making process, really putting military retiree health care last. Now, because this is a mandatory spending program, the funding will be there."
Before the expansion of the Tricare program, veterans, except those injured or disabled in war, were dropped from the program when they reached age 65 and became eligible for Medicare. The only "additional coverage" for military retirees was the military's network of hospitals and clinics. However, with the end of the Cold War and the "shrinking of the military," the Pentagon has closed or cut back services as the clinics. Since 1985, 37 military hospitals have closed and 23 additional facilities downsized into clinics. When there was not a shortage of "room and resources," retirees were "welcomed" at the hospitals and clinics, but have since been "turn[ed] ... away." The new benefit is intended to provide care for the veterans, who say they were "promised lifelong healthcare" by recruiters in return for a military career. To handle the number of veterans who sign up for Tricare coverage, the health plan is hiring "hundreds" of new employees. Also, its directors are meeting with Medicare providers, managed care contractors and retiree groups to "cope" with the new requirements. Steve Lillie, director of the Over-65 Division of TriCare, said, "We expect huge turnover of retirees from their private plans to this one. Our expectation is that unless someone has a fully-funded Medicare supplement plan, and most don't, they will switch to TriCare" (Schrader, Los Angeles Times, 8/5).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.