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New Tricare Law
Old 09-29-2007, 03:49 PM   #1
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New Tricare Law

This is part of an email that I received from MOAA. Not sure how accurate it is but they are generally pretty good about this stuff.

Many military retirees who work for defense contractors, airlines, and certain state governments are getting letters from their employers that their health coverage options will change as of Jan 1. In many cases, it's a notice that the employer will no longer be able to offer a TRICARE supplement as one of its health plan options.
That's because a provision in last year's Defense Authorization Act (FY2007) bars civilian employers from offering their employees incentives to use TRICARE rather than the company's normal health plan. It specifically bars offering employees a TRICARE supplement.
Congress has no problem with retirees choosing TRICARE on their own initiative, since they earned the right to the TRICARE benefit through their service. But the Defense Department and Congress developed extensive evidence that many employers - including several state governments - have been consciously working to shift their health care costs to TRICARE, sending letters to TRICARE-eligible employees urging them to use TRICARE rather than the employer's plan. And tens of thousands of TRICARE-eligibles across the country have taken up those offers in recent years.
This was part of the reason that the Defense Department proposed raising fees for TRICARE enrollees by up to $1,000 a year - to help stem the tide of people opting out of employer-based plans. So far, Congress has agreed with MOAA that imposing steep TRICARE fee hikes isn't the appropriate reaction.

But the Armed Services Committees took a dim view of employers who seek to cut their costs at TRICARE's expense, and changed the law to try to discourage that behavior.

Initially, the law was interpreted as barring any reimbursement that could be used to cover TRICARE expenses. That strict interpretation would have barred TRICARE-eligibles from participating in company-sponsored cafeteria plans (under which employees can receive a specified amount of cash that can be used to purchase coverage) or plans that pay a flat monthly amount to any employee who elects to use alternative coverage, whether it's TRICARE or a spouse's employer plan.

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Old 09-30-2007, 02:28 AM   #2
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