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 date 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, TRICARE
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
(e.g., retirees, family members of retirees, survivors) 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 TRICARE
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 TRICARE Prime enrollees shall
pay no more TRICARE 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 TRICARE 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 FY 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.