Trading Set to Begin On Key TRICARE Issues

September 22, 2017

As the House and Senate Armed Service Committees prepare to meet to hash out their respective positions on the FY2018 National Defense Authorization Act (NDAA), it is more urgent than ever for you to alert your legislators to these key issues of importance to every TRICARE beneficiary:

  • TRICARE enrollment fees, as well as other fees, would be hit with significant increases according to the Senate's proposed bill. The Senate is looking for ways to plow savings back into readiness and other unspecified projects, and it wants to do this by repealing the grandfathering clause for TRICARE fees contained in last year's law, which shielded current TRICARE beneficiaries from new fees. The proposed fee structure, which could start immediately depending on the negotiations, would result in the doubling of fees for many beneficiaries.
  • Raising TRICARE pharmacy cost shares, as proposed in the Senate's NDAA version, would impact TRICARE For Life beneficiaries the most. These increases are especially appealing to the Senate because the pharmacy benefit consists of mandatory spending for beneficiaries over the age of 65. The Senate's plan proposes that the savings resulting from these fee hikes could then be used to fund other accounts and programs- programs like the Special Survivor Indemnity Allowance (SSIA) to remedy the Survivor Benefit Plan (SBP)/Dependency Indemnity Compensation (DIC) offset, also known as the “widows' tax,” which offsets a military survivor's monthly SBP annuity by any DIC they receive. MOAA has a longstanding record of advocating for a permanent fix for the widows' tax/SSIA situation. However, taxing beneficiaries' earned benefits is not the way to do it. Keep in mind, too, that many of those affected by the widows' tax use the pharmacy benefit as well. 
  • The Senate's proposal to tie all TRICARE fees to a national health care index would increase the cost of your health insurance. Premiums, copayments, deductibles, and catastrophic caps would rise annually based on increases in health care costs as measured by per capita growth in the National Health Expenditures (NHE). Currently, TRICARE fees and applicable cost shares are tied to the annual rise in COLA. Swapping this index for an arbitrarily selected index, the NHE, would result in beneficiaries paying substantially more for health care over time. A beneficiary's fees would have increased more than 48 percent over the past 10 years if fee increases were linked to the NHE. Compare this to only 18 percent for the same period as currently indexed to COLA.

“We do not think raising TRICARE fees through the repeal of last year's grandfathering, using the pharmacy program as a money source, and tying fees to anything but COLA is in any way fair to beneficiaries,” says Capt. Kathy Beasley, USN (Ret), MOAA's Government Relations Director for Health Affairs. “The House saw fit to keep what is in the current law, to include the existing grandfathered fee structure, and to maintain focus on the implementation of the current TRICARE reform efforts. MOAA strongly agrees with the House.”

Please send your legislators this MOAA suggested message to prevent these hefty fee increases from negatively impacting servicemembers


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