Having access to affordable health care is among the top concerns for retirees, and there have been several approaches over the years to ensure coverage for older Americans who “age out” of other Tricare plans. For Medicare-eligible Tricare beneficiaries, retirees, and their family members, Tricare for Life may be the best available option that balances affordability and access to care.
What is Tricare for Life?
Tricare for Life was introduced in 2001 in order to extend benefits to the retiree population, which was previously expected to receive medical care under Medicare — the U.S. government’s health insurance program for people 65 and older (as well as some under 65 with certain disabilities). Under the previous system, retirees and their eligible family members aged 65 or older would no longer be eligible for Tricare benefits. However, since Medicare does not pay for 100% of all health care costs, retirees were expected to ‘foot the bill’ for the remaining expenses.
Enter Tricare for Life, which is described as “Medicare-wraparound” coverage in which Tricare acts as a second payer that covers costs not paid by Medicare. Tricare for Life is available worldwide — even outside of the United States where Medicare is unavailable. For retirees living in foreign countries, Tricare for Life acts as the first payer for health care, making it a valuable resource.
Tricare for Life Top Five Facts You Need to Know
- Greater Freedom of Choice in Selecting Providers: Beneficiaries can choose from any Medicare-authorized provider, but the selection of certain VA providers or those who opt-out of Medicare could lead to greater out-of-pocket expenses.
- Must Be Enrolled in Medicare Parts A and B: Eligibility is based on enrollment in Medicare Parts A and B (typically retirees over 65 or those under 65 with disabilities).
- Main Cost is Medicare Part B Premium: There is no annual deductible and the standard Medicare Part B premium for 2020 is $144.60.
- Greater Out-of-Pocket Costs for Retirees Living Overseas: Medicare does not extend outside of the U.S., meaning that Tricare for Life will be the single-payer for health care received in all foreign locations. Beneficiaries will therefore be required to pay catastrophic cap, deductibles, and cost shares for health care received overseas.
- Long-term Care Not Covered: The plan covers skilled nursing facilities but not nursing homes or assisted living facilities.
Eligibility & Costs
Am I Eligible?
All Tricare-eligible beneficiaries who have both Medicare Parts A and B (most typically retirees 65 years and older) are eligible for Tricare for Life. In order to avail of Tricare for Life benefits, you must first enroll in Medicare and pay Medicare Part B premiums. As opposed to Medicare Part A costs, which are paid from payroll taxes while individuals are still working, Medicare Part B is a monthly premium based on one’s income. When retirees and their family members become eligible for Tricare for Life, it’s important to know that they are no longer eligible for Tricare Prime or Tricare Select. Additionally, family members are only eligible for Tricare for Life if they too are enrolled in Medicare.
There is no enrollment fee or specific premiums for Tricare for Life benefits; however, beneficiaries must have both Medicare Parts A and B in order to receive health coverage. Therefore, the single main expense for Tricare for Life is the Medicare Part B monthly premium (the standard Part B monthly premium for 2020 is $144.60). For health care services that are covered by both Tricare and Medicare, beneficiaries will pay no out-of-pocket costs. However, if beneficiaries choose medical providers who are either not within the Tricare network (e.g. non-network providers) or who opt-out of Medicare, individuals will pay significantly higher costs. A detailed cost matrix for a variety of health care services is available here.
Tricare for Life-eligible beneficiaries living or traveling outside of the United States are responsible for paying an annual deductible as well as cost shares, since Medicare is unavailable outside of the country.
If your information in DEERS is up-to-date, then enrollment in Tricare for Life is not required because coverage is automatic for Tricare beneficiaries who have Medicare Parts A and B. Individuals who become eligible for Medicare upon turning 65-years-old will be prompted to sign up for Medicare several months prior to their birthday. Signing up promptly for Medicare will enable Tricare-eligible beneficiaries to avoid any break between Tricare and Tricare for Life coverage.
Important Tricare for Life Resources
- Wisconsin Physicians Service: 1-866-773-0404
- International SOS: Phone numbers for regional call centers are available here.
Additionally, the comprehensive Tricare for Life handbook can be downloaded from the Tricare publications page.
Advantages & Disadvantages
Tricare for Life can seem relatively complex when compared with other Tricare plans due to its Medicare-wraparound nature, but yields substantial advantages for eligible populations.
Tricare for Life: Advantages
- Global Coverage: This plan is available worldwide and does not have specific areas of service. For those living overseas where Medicare coverage does not extend, Tricare for Life benefits are still available, but costs will be higher.
- Affordability for Select Services: There is no annual deductible for services that are covered by both Medicare and Tricare. Therefore, the beneficiary is responsible for none of the costs of most routine, covered services.
- Claims Typically Filed on Your Behalf: Providers generally file claims directly with Medicare, which will pay its portion and forward the remaining claim to Tricare, meaning that individuals typically have fewer administrative responsibilities.
- Freedom to Select Any Eligible Provider: Beneficiaries can choose any Medicare-eligible provider. However, it’s important to note that care delivered from some Veterans Administration providers or providers who opt-out of Medicare will be more expensive options, since Medicare will not contribute to the overall cost.
Tricare for Life: Disadvantages
- Coordination between Tricare and Medicare: Since Tricare for Life is effectively a coordinated effort between Tricare, managed by the Department of Defense, and Medicare, which is managed by the Center for Medicare and Medicaid Services, there is the potential for disconnect between the two agencies, resulting in claim confusion or other bureaucratic issues. Additionally, since Medicare acts as the primary payer, Medicare has determination over the “medical necessity” of a given service. If Medicare determines that care is not medically necessary, it can refuse to pay, and Tricare can follow suit unless the beneficiary appeals. This can lead to a greater burden of responsibility on the Tricare beneficiary.
- Certain Services Not Covered: There are certain services — such as long-term care in a nursing home (note difference between ‘nursing home’ and ‘skilled nursing facility’, which is covered) or assisted living facility — that are excluded from Tricare for Life coverage. These types of long-term care tend to be significant cost drivers, but are not included under Tricare for Life.