Military Health System

1.3.1.1  When Medicare makes a payment for benefits also covered by TRICARE, the beneficiary will generally have no out-of-pocket expense. For these claims TRICARE will resemble a Medicare supplement. That is, the allowable amount under Medicare will be used as the TRICARE allowable, and TRICARE payment will equal the remaining beneficiary liability after Medicare processes the claim without regard to any TRICARE deductible and cost-share amounts that would otherwise be assessed. For example, if it is the first claim of the year and the billed charge is $50 (which is also the amount both Medicare and TRICARE allow on the claim), Medicare will apply the entire amount to the Medicare deductible and pay nothing. In this case, TRICARE will pay the full $50 so that the beneficiary has no out-of- pocket expense. Similarly, if Medicare pays an amount that is greater than what TRICARE normally would allow for a network provider, TRICARE will still pay any Medicare deductible and cost-sharing amounts, even if that represents payments in excess of the normal TRICARE allowable amount.

1.3.1.2  If the service or supply is normally a benefit under both Medicare and TRICARE, but Medicare cannot make any payment because the beneficiary has exhausted Medicare benefits, TRICARE will make payment as the primary payer assessing all applicable deductibles and cost-shares. For example, TRICARE is primary payer for inpatient care beyond 150 days.

1.3.1.3  If the service or supply is normally a benefit under both Medicare and TRICARE, but Medicare cannot make any payment because the beneficiary receives services overseas where Medicare will not make any payment, TRICARE will process the claim as a primary payer assessing any applicable deductibles and cost-shares. Since the contractor knows that Medicare cannot make any payment on such claims, the contractor shall process the claim without evidence of processing by Medicare. Even though Medicare cannot make payment overseas, beneficiaries receiving care overseas must still purchase Part B of Medicare in order to maintain their TRICARE eligibility.

1.3.1.4  If the service or supply is normally a benefit under both Medicare and TRICARE, but Medicare does not make any payment because the service or supply is not medically necessary, TRICARE cannot make any payment on the claim. In such cases, the contractor shall deny the claim. The beneficiary/provider must file an appeal with Medicare. If Medicare subsequently reverses its medical necessity denial, Medicare will make payment on the claim and it can then be submitted to TRICARE for processing. If Medicare does not reverse its medical necessity denial, the claim cannot be paid by TRICARE, and the Medicare appeal decision is final. TRICARE will not accept an appeal in such cases, and the contractor will advise the beneficiary that the final determination rests with Medicare.

1.3.1.5  When Medicare does not make a payment because services were rendered by a non-Medicare provider or effective for services on or after March 1, 2007, because the provider has a private contract with the beneficiary (also referred to as “opting out” of Medicare), and the services are a TRICARE benefit, TRICARE will process the claim as second payer. In these cases, when TRICARE processes as secondary payer, TRICARE first payer review and reporting rules apply. The TRICARE payment will be the amount that TRICARE would have paid (TRICARE cost-shares and deductibles do not apply) had the Medicare program processed the claim (normally 20% of the allowable charge). If there is not an available Medicare allowed amount, the TRICARE allowed amount shall be calculated and 20% of that amount will be reimbursed (TRICARE cost-shares and deductibles do not apply). Evidence of processing by Medicare for non-Medicare providers is not required; rather a statement from the provider verifying their Medicare status is sufficient for processing. Opt out providers will be identified based on the Medicare Part B carriers web sites. In cases where the beneficiary’s access to medical care is limited (i.e., under served areas), the TRICARE contractor may waive the 20% of the allowable charge payment amount and pay 100% of the allowable amount assessing all applicable deductibles and cost-shares. In most cases, under served areas will be identified by zip codes for Health Professional Shortage Areas (HPSAs) and Physician Scarcity Areas (PSAs) on the Centers for Medicare and Medicaid Services (CMS) web site at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HPSAPSAPhysicianBonuses/index.html and will automatically pay 100% of the allowable amount assessing all applicable deductibles and cost-shares. In cases where the zip code for an underserved area is not identified on the CMS web site, or in areas where there are no or limited Medicare participating providers, a written waiver request with justification identifying the county where the service was received will be required by the contractor to pay 100% of the allowable amount assessing all applicable deductibles and cost-shares. TRICARE contractors will identify HPSA or PSA zip codes or the county for underserved areas on the above CMS web site and identify opt out providers based on the Medicare Part B carriers web sites.

1.3.1.6  When Medicare does not make a payment based on their Competitive Bidding Program (CBP) for Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS), the TRICARE contractor shall process the claim as second payer for otherwise TRICARE covered items of DMEPOS. In these cases, when TRICARE processes as secondary payer, TRICARE first payer review and reporting rules apply. The TRICARE payment shall be the amount TRICARE would have paid (cost-shares and deductibles do not apply) had Medicare processed and paid the claim (normally 20% of the allowable charge). If there is not an available Medicare allowed amount, the TRICARE allowed amount shall be calculated and 20% of that amount will be reimbursed (cost-shares and deductibles do not apply). Public use files containing the competitive bid single payment amounts per Healthcare Common Procedure Coding System (HCPCS) code are posted on the CMS’ competitive bidding contractor’s web site: http://www.dmecompetitivebid.com/palmetto/cbic.nsf/DocsCat/Home. TRICARE contractors shall identify the competitive bid single payment amount using the above CMS web site to identify what Medicare would have allowed had the beneficiary followed Medicare’s rules. Implementation of Medicare’s DMEPOS CBP pricing is effective January 1, 2011.

1.3.1.7  When Medicare does not make a payment because Medicare rules were not followed or because the beneficiary failed to meet some other requirement of coverage (e.g., denied for no referral, no or untimely authorization, invalid place of service, etc.). TRICARE will process the claim as second payer as long as the services meet TRICARE coverage rules. This exception does not include Medicare medical necessity denials. In these cases, when TRICARE processes as secondary payer, TRICARE first payer review and reporting rules apply. The TRICARE payment will be the amount that TRICARE would have paid (TRICARE cost-shares and deductibles do not apply) had the Medicare program processed the claim (normally 20% of the allowed charge). If there is not an available Medicare allowed amount, the TRICARE allowed amount shall be calculated and 20% of that amount will be reimbursed (TRICARE cost-shares and deductible do not apply).

1.3.1.8  Effective October 28, 2009, TRICARE beneficiaries who are entitled to premium-free Medicare Part A because of disability, where Social Security Disability Insurance (SSDI) is awarded on appeal remain eligible for coverage under the TRICARE program (see the TOM, Chapter 20, Section 1, paragraph 2.6). Eligible beneficiaries are required to keep Medicare Part B in order to maintain their TRICARE coverage for future months, but are considered to have coverage under the TRICARE program for the retroactive months of their entitlement to Medicare Part A. For previously processed claims the contractor that processed the claim shall not initiate recoupment due to eligibility or jurisdiction and existing actions should be terminated. Medicare becomes primary payer effective as of the original Medicare Part B effective date.

1.3.4.1  If services or supplies are provided in a TRICARE authorized DVA/VHA hospital pursuant to the TPM, Chapter 11, Section 2.1, Medicare will make no payment. In such cases TRICARE will process the claim as a second payer. In these cases, when TRICARE processes as secondary payer, TRICARE first payer review and reporting rules apply. The TRICARE payment will be the amount that TRICARE would have paid (TRICARE cost-shares and deductibles do not apply) had the Medicare program processed the claim (normally 20% of the allowable charge).

1.3.4.2  For TRICARE beneficiaries who are not enrolled in Medicare Part B because they are exempt from enrolling, TRICARE will process the outpatient claims as the primary payer assessing any applicable deductibles and cost-shares, in accordance with the TOM, Chapter 20, Section 3, paragraph 6.1.