Defense health officials are encouraging the hundreds of thousands of military retirees who will have to start paying enrollment fees for their Tricare Select health care coverage as of Jan. 1 to take action now to set up their payment process.
And if you do this before Nov. 20, you can avoid having to pay enrollment fees in advance.
Starting Jan. 1, these retirees, generally working-age retirees under age 65, will pay $12.50 a month for individual coverage, or $150 annually. Enrollment fees for those with families will be $25 a month, or $300 annually. These fees were put into law in the Fiscal 2017 National Defense Authorization Act, but delayed until January 2021.
There were 407,431 military retirees and 764,936 retiree family members in Tricare Select at the end of 2019, according to a DoD report. It also applies to retirees in the Tricare Overseas Program Select.
The fees don’t apply to retirees in the Tricare for Life program, nor does it affect Chapter 61 retirees (receiving disability retirement) and their family members, and survivors of deceased active duty service members. Active duty family members don’t pay Tricare Select enrollment fees.
Affected retirees definitely should set their payment up before Nov. 20, said Mark Ellis, chief of policy and programs for the Tricare Health Plan. That way you can avoid having to pay one or two months of premiums in advance. Ellis, who is a retiree with Tricare Select coverage, said he recently made his call to set up his payment, “and it took all of about three minutes.”
Officials also encourage retirees to set up their payment process before Open Season starts on Nov. 9, when the contractors will be busier.
Retirees should contact their regional Tricare contractor by phone or through their website to set up their fee payment — by retired pay allotment, through electronic funds transfer, or debit or credit card. Officials are encouraging retirees to pay for their Tricare Select coverage by military allotment if possible. Using another form of payment such as a credit card, or electronic transfer a checking or savings account can sometimes result in problems — for example, when a card is lost or stolen, or a charge is not accepted for some other reason.
If the premium isn’t paid by Jan. 1, you could lose coverage. Under federal law, “we don’t have legal authority to provide care or process claims” if the fees are not paid, he said.
“We realize things happen,” he said, noting that there is a process in place for the Tricare Select retirees to be notified, if, for example, an electronic funds transfer or credit card payment fails to go through. There is a reinstatement period of 90 days, and if the back fees are paid, the coverage can be reinstated back to the day after the retiree stopped paying fees, and coverage is brought up to date. “As long as back fees are paid, we can process denied claims,” Ellis said. “We can’t do it forever, but we do have processes in place.”
These new fees affect retirees and their family members in the so-called Group A — the sponsor’s initial enlistment or appointment was before Jan. 1, 2018. The retirees in Group A are generally working-age retirees under age 65. Currently they don’t pay enrollment fees, but under the National Defense Authorization Act of 2017, Congress required defense officials to start charging these working-age retirees enrollment fees in 2021.
The law delayed the start of these fees until Jan. 1, 2021. Also starting in 2021, the catastrophic cap for how much these retirees pay out of pocket for Tricare-covered services increases from $3,000 to $3,500.
The 2020 Tricare open season begins Nov. 9 and ends Dec. 14, 2020.
Editor’s note: This article was updated to reflect the accurate date for setting up the payment without having to make upfront payments. Tricare previously provided incorrect information.
Karen has covered military families, quality of life and consumer issues for Military Times for more than 30 years, and is co-author of a chapter on media coverage of military families in the book "A Battle Plan for Supporting Military Families." She previously worked for newspapers in Guam, Norfolk, Jacksonville, Fla., and Athens, Ga.