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 199.17, 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 dat
e 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.