1.0 DESCRIPTION
1.1 The National
Defense Authorization Act (NDAA) for Fiscal Years (FYs) 1988 and
1989 (Public Law 100-180) amended Title 10, United States Code (USC),
and established catastrophic loss protection for TRICARE beneficiary
families on a Government fiscal year basis. The law placed fiscal
year limits or catastrophic caps on beneficiary liabilities for
deductibles and cost-shares under the TRICARE Basic Program. The
NDAA for FY 1993 (Public Law 102-484) amended Title 10, USC, and
reduced the catastrophic cap for beneficiaries other than Active
Duty Family Members (ADFMs). The NDAA for FY 2001 also amended Title
10, USC, and further reduced the fiscal year catastrophic cap for
beneficiaries other than ADFMs from $7,500 to $3,000.
1.2 32
CFR 199.18(f), authorizes catastrophic loss protection
for TRICARE Prime beneficiary families on a one-year enrollment
period basis in addition to the protection on a fiscal year basis.
The enrollment period shall coincide with the fiscal year (i.e.,
the beneficiary’s initial enrollment data is May 1 with the enrollment
expiration being October 1, all future enrollment periods will be
October 1 to October 1).
2.0 POLICY
2.1 TRICARE Standard
and TRICARE Extra
2.1.1 Catastrophic
Cap For ADFMs
Under the TRICARE Extra and
TRICARE Standard, the maximum family liability is $1,000 for deductibles
and cost-shares based on allowed charges for the services and supplies
received in a fiscal year.
2.1.2 Catastrophic Cap For All Other
Beneficiaries
For dates of service on or
after October 1, 2000, the fiscal year cap is $3,000.
2.1.3 Cap is Met
For beneficiaries not enrolled in TRICARE Prime,
after the fiscal year catastrophic cap is met, the TRICARE determined
allowable amount shall be paid in full for all covered services
and supplies under TRICARE Standard and Extra for the remainder
of the fiscal year.
2.2 TRICARE Prime
Under TRICARE Prime, in addition to the catastrophic
loss protection based on the fiscal year, Prime enrollees also have
an enrollment year catastrophic cap.
2.2.1 For TRICARE Prime enrollees
who are ADFMs. Out-of-pocket expenses accrue toward the $1,000 fiscal
year catastrophic cap. The enrollment year catastrophic cap is eliminated effective December
31, 2017.
2.2.2 For TRICARE Prime enrollees who are other than
active duty personnel or ADFMs (i.e., retirees, family members of
retirees, survivors, etc.) out-of-pocket expenses accrue toward
a $3,000 per enrollment year catastrophic cap. Out-of-pocket expenses
also accrue toward the $3,000 fiscal year catastrophic cap.
2.2.3 For TRICARE
Prime enrollees that retire other than the first of the month, enrollment
in TRICARE Prime shall be allowed with no break in coverage. The
enrollment anniversary date shall be determined using the existing
“20th day of the month” rule. Additional enrollment fees shall not
be collected for days between the effective enrollment date and
the determined enrollment anniversary date. Any out-of-pocket payments
made by the enrollee between the actual enrollment date and the enrollment
year start date (anniversary date) shall not be applied to the enrollment
year catastrophic cap. Out-of-pocket expenditures shall be applied
to the enrollment year and fiscal year catastrophic cap as of the
enrollment anniversary date.
2.2.4 Prime enrollees shall pay
no more applicable out-of-pocket expenses for the rest of the fiscal
year once the fiscal year catastrophic cap is met.
2.2.5 Prime enrollees
shall pay no more Prime copayments or enrollment fees for the rest
of the enrollment year once the enrollment year catastrophic cap
is met.
2.2.6 The following expenses may be credited to a
Prime beneficiary’s fiscal year catastrophic cap:
• Enrollment fees,
• The outpatient
and inpatient cost-shares and copayments.
Note: Deductibles and cost-shares imposed on services
provided under the Point of Service (POS) option shall not be creditable
to the enrollment/fiscal year catastrophic cap.
2.3 Double Coverage
For purposes of catastrophic loss protection,
the full deductible and cost-share calculated according to the TRICARE
provisions shall be credited toward meeting the applicable catastrophic
cap (even when double coverage exists). See an illustration below
for an inpatient retiree with other insurance who is not enrolled
in TRICARE Prime:
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Total Amount Billed
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$8,169.11
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Total Amount Allowed
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8,169.11
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Cost-Share (25%
of the Total Amount Allowed)
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2,042.27
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Paid By Beneficiary
To Provider
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0.00
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Paid By Other
Health Insurance (OHI)
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7,119.11
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Total TRICARE
Payment
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1,050.00
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AMOUNT TO BE CREDITED
TOWARD CAP
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$2,042.27
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Note: Normal double
coverage rules, as provided in
Chapter 4, Section 1,
remain in effect after the cap has been reached. The beneficiary
shall not have to pay a cost-share after the OHI has made payment.
2.4 TRICARE Supplemental
Plans
TRICARE supplemental plans which provide
coverage for deductibles, cost-shares, and sometimes for non-covered
services, will be ignored. As with double coverage, the full deductible
and cost-share shall be credited toward meeting the catastrophic
cap.
2.5 Multiple
Family Situations
Multiple family situations--e.g.,
sponsor and new spouse and children live together, and sponsor’s
children from previous marriage live elsewhere--shall be treated
as one family. In other words, for a divorced and then remarried
sponsor with two sets of family members, their deductibles and cost-shares
shall be combined to meet the fiscal year catastrophic cap.
Note: When a family’s sponsor changes, e.g., a spouse
divorces a sponsor and marries another active duty person, then
only the new sponsor’s liabilities for deductible and cost-shares
in a fiscal year shall count toward meeting the cap. In other words,
this spouse cannot carry to the new family those credits accumulated
toward the cap under the previous sponsor.
2.6 Former Spouses
Any TRICARE eligible former spouse will be
treated as an “other than ADFM.” For the purpose of determining
the catastrophic cap, a former spouse will be treated as an independent
family and must independently meet the catastrophic cap.
2.7 Change of
Sponsor Status
A change in a sponsor’s duty
status will have the following effects on application of the catastrophic
cap.
2.7.1 Claims
Subject To The TRICARE DRG-Based Payment System
2.7.1.1 When the
status changes during a beneficiary’s inpatient stay, the appropriate
catastrophic cap shall apply to that stay according to the beneficiary’s
cost-sharing status for the stay. Effective for services provided
after midnight of the day of discharge from the hospital, the catastrophic
cap shall be based on the sponsor’s current status.
2.7.1.2 When the
status changes at any time other than during a beneficiary’s inpatient
stay, the appropriate catastrophic cap (according to the sponsor’s
current duty status) shall apply for TRICARE eligible families for
the remaining fiscal year (or until the status changes again) effective
for services provided after midnight of the day the duty status
changes.
2.7.1.3 When the status changes, the full deductible
and cost-shares credited toward meeting the previous family cap
shall be credited toward the new cap as the sponsor’s liabilities
in the same fiscal year. However, in no case shall a change in a
sponsor’s status from retired to active duty result in an adjustment
to previous claims, even if the aggregate cost-share has exceeded
the active duty cap.
2.7.2 Claims Exempt From The TRICARE
DRG-Based Payment System
When a sponsor’s
duty status changes, the appropriate cap (according to the sponsor’s current
duty status) shall apply for TRICARE eligible families for the remaining
fiscal year effective for services provided after midnight of the
day the duty status changes. The full deductible and cost-shares
credited toward meeting the previous family cap shall be credited
toward the new cap as the sponsor’s liabilities in the same fiscal
year.
2.8 Inpatient Care Spanning Two
Fiscal Years
When the dates of inpatient
care span different fiscal years, it is absolutely necessary that
the catastrophic cap application be as accurate as possible. If
for a claim the ending date of care is in a different fiscal year
from the beginning date of care, the beneficiary cost-share amount
shall be allocated between the two fiscal years based on the dates
of care. For the purpose of the catastrophic cap application only,
the following provisions are applicable:
2.8.1 Cost-Share When Fixed Daily
Amount Is Known
When the beneficiary cost-share
is based on a fixed daily amount (or when such amount can accurately
be calculated), the actual daily cost-share amount shall be allocated
between the two fiscal years according to the days of care received
in each fiscal year.
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Example: DRG
claim involving per diem cost-share amounts. Retiree admitted on
September 26, 2005 [FY 2005] and discharged on October 3, 2005 [FY
2006]:
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We
know that effective October 1, 2005, the cost-share per diem for
other than active duty dependents went up from $512 to $535. We
also know that no per diem cost-share amount shall be required for
the day of discharge.
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Step 1: CALCULATE FY 2005 CATASTROPHIC
CAP CREDIT
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FY 2005
care (from 09/26 through 09/30/2005)
FY 2005 cost-share per diem
FY 2005 catastrophic cap credit
[5 days X 512/day = $2,560.00]
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= 5 days
= $512/day
=
$2,560.00
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Step 2: CALCULATE FY 2006 CATASTROPHIC
CAP CREDIT
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FY 2006
care (from 10/01 through 10/03/2005)
[excludes day of discharge]
FY 2006 cost-share per diem
FY 2006 catastrophic cap cost-share credit
[2 days X 535/day = $1,070.00]
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= 2 days
=
$535/day
= $1,070.00
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2.8.2 Cost-Share When Fixed Daily
Amount Is NOT Known
When a fixed (or actual)
daily amount of cost-share is not known or cannot be accurately determined,
the daily cost-share amount shall be calculated by proration, that
is, by dividing the claim’s cost-share amount by the number of days
of care (not counting the day of discharge) and the resulting daily
amount shall be allocated between the two fiscal years according
to the days of care received in each fiscal year.
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Example: Hospital
claim involving a cost-share amount that is 25% of the TRICARE-determined allowable
charge. Retiree admitted on September 29, 2005 [FY 2005] and discharged on
October 8, 2005 [FY 2006] with a TRICARE-determined allowable charge
of $10,000.00:
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Step 1: CALCULATE TOTAL COST-SHARE
AMOUNT
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25% of $10,000.00
allowable charge
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= $2,500.00
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Step 2: CALCULATE TOTAL DAYS OF
CARE
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Care (from
09/29 through 10/08/2005)
[excludes day of discharge]
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= 9 days
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Step 3: CALCULATE DAILY COST-SHARE
AMOUNT
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$2,500.00
cost-share amount
÷
9 days of care
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$277.78/day
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Step 4: CALCULATE FY 2005 CATASTROPHIC
CAP CREDIT
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FY 2005
care (from 09/29 through 09/30/2005)
FY 2005 catastrophic cap cost-share credit
[2 days X 277.78/day = $555.56]
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= 2 days
= $555.56
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Step 5: CALCULATE FY 2006 CATASTROPHIC
CAP CREDIT
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FY 2006
care (from 10/01 through 10/08/2005)
[excludes day of discharge]
FY 2006 catastrophic cap cost-share credit
[7 days X 277.78/day = $1,944.46]
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= 7 days
=
$1,944.46
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3.0 EXCEPTIONS
3.1 No catastrophic
loss protection is available for the North Atlantic
Treaty Organization (NATO)/Partnership
for Peace (PfP) family members.
3.2 The Extended
Care Health Option (ECHO) sponsor/beneficiary liabilities shall
not accrue toward meeting the catastrophic cap.
3.3 Beneficiary
costs for non-covered services or any beneficiary payments above
the TRICARE determined allowable charge, shall not count toward
meeting the catastrophic cap.
3.4 For TRICARE Prime enrollees,
POS deductible and cost-share amounts do not have a catastrophic
cap.
4.0 EFFECTIVE
DATES
4.1 The fiscal year catastrophic cap is $7,500
for beneficiaries other than ADFMs effective fiscal year 1993. Effective
October 1, 2000 [FY 2001], the fiscal year catastrophic cap is $3,000
for beneficiaries other than ADFMs.
4.2 The enrollment year catastrophic
cap is $3,000 for beneficiaries other than ADFMs who are enrolled
in TRICARE Prime effective November 1, 1995. It will apply to out-of-pocket
expenses incurred on and after November 1, 1995.
4.3 Effective
October 1, 1996, enrollment fees accrue toward the fiscal year catastrophic
cap under TRICARE Prime.
4.4 Effective October 1, 1996,
the calculation for the enrollment period catastrophic cap for ADFMs enrolled
in TRICARE Prime is eliminated.