“Retiree fees ought to relate to how much the plan is worth,” she said. “The … higher-value plans should have higher premiums associated with them.”
The panel believes fees need to be fair to all retired military members, Eakle said. “They ought to reflect how much income an individual has, so that if they make more money and are therefore better able to pay for a system, they should do so,” she said.
One problem is the fee structure for Tricare has not changed in 13 years. “When Tricare started out in 1995, military members, retirees were charged $230 per individual, $460 per family,” she said. “Today in 2008, they’re charged $230 per individual, $460 per family.”
In 1995, servicemembers paid 27 percent of their health care cost. Today that share is less than 12 percent.
Over-65 military retirees — those using the “Tricare for Life” program — have been paying the Medicare Part B program fee of 25 percent, but this is due to rise. “Essentially what this says to you is that we are asking our older retirees, who are in fact the least likely to hold jobs and therefore have the lowest incomes, to pay the most for their system,” Eakle said.
But Tricare for Life is a much more generous program than Tricare Prime. “We believe we need to get some parity between our older and our younger retirees,” Eakle said.
The panel wants to redress some of this imbalance. “We believe that the under-65 retirees should begin paying 40 percent of the Medicare Part B premium using the same fee structure that is laid on by the Medicare system,” Eakle said, adding that this should bring the system into a semblance of parity.
“In addition, we believe that the under-65 retirees … who elect to use Tricare Standard and Extra need to pay a small fee for that,” she said. “And we would suggest to the department that that fee be set at 15 percent of the Medicare Part B. We think the family rate should be set at double the individual rate and that the premium increase needs to be phased in over four years.”
Other recommendations include using the Medicare deductible rate — $135 per person in 2008 — for Tricare. The panel also recommended to the department that all co-pays and co-insurance for any preventative service be provided at no cost to all members and retirees who have access to Tricare.
The final panel recommendation to DoD is to establish an open enrollment period for Tricare, Eakle said.