The FY 2025 DoD budget proposal includes no mention of TRICARE cost-sharing requirements or other fee increases – good news for beneficiaries, as past TRICARE fee increase proposals have originated with the annual budget request.

The White House budget, released March 11, includes a Unified Medical Budget (UMB) request of $61.4 billion, up 4.6% from the FY 2024 budget request. The UMB is made up of several accounts within the annual defense appropriations bill including Operations and Maintenance (O&M), MILPERS (funding for military personnel operating the MHS), and MILCON, which funds Military Health System (MHS) construction projects.

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The request for the Defense Health Program (DHP) sits at $40.3 billion, up from $38.4 billion in the FY 2024 request. DHP, a sub-account of O&M, funds MHS functions such as health care delivery in military treatment facilities (MTFs); TRICARE; certain medical readiness activities and expeditionary medical capabilities; and education and training programs.  

DHP spending growth is driven predominantly by MTF investment designed to sustain direct care capabilities and modernize electronic health records/digital health. Within the FY 2025 DHP request, $20.6 billion, or 51%, is for purchased care via TRICARE.

‘Strategic Imperative’

The budget narrative underscores the updated MHS strategy to restore MTF capacity, reattract beneficiaries to the direct care system of military hospitals and clinics, and increase opportunities to sustain uniformed medical provider clinical readiness.

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“We recognize a strategic imperative to rebuild our military and civilian medical workforce and resource the MHS,” the budget overview states. “The DoD leadership determined the most effective way to take care of our people, support the National Defense Strategy, increase clinical readiness, mitigate risks to requirements, and reduce long-term cost growth in private sector care is to reattract beneficiaries to Military Treatment Facilities (MTFs) and maximize medical education and training pipelines.”

The budget document also provides an update on past medical billet cut proposals, an initiative MOAA successfully advocated to halt in several consecutive defense authorization bills. DoD has suspended planned clinical military medical end strength divestitures and will use this congressionally directed pause to conduct an assessment of current military medical end strength to match operational requirements.   

Following this assessment, DoD will submit a report to the House and Senate Armed Services Committees that certifies the completion of a comprehensive review of military medical manning and justification for any proposed changes to the composition of military medical end strength. The report will include plans to address civilian backfill and persistent civilian vacancies or risks associated with the planned reductions.

[RELATED: MOAA’s TRICARE Guide]

As the FY 2025 NDAA process moves forward, MOAA remains focused on legislation and congressional oversight that will ensure beneficiaries have access to quality care as DoD implements the new MHS stabilization strategy. Please watch your MOAA newsletter and our Advocacy News page for opportunities to support our efforts through MOAA’s Legislative Action Center.