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 FY basis.
The law placed FY 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 FY 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
FY basis
(Calendar
Year (CY) beginning January 1, 2018). The enrollment
year
coincides with CY starting January 1, 2018.
2.0 POLICY
2.1 TRICARE
Standard and TRICARE Extra
2.1.1 Catastrophic
Cap For ADFMs
Under TRICARE
Extra and TRICARE Standard, the maximum family liability is $1,000
for deductibles and cost-shares based upon allowed
charges for the services and supplies received in a FY.
2.1.2 Catastrophic Cap For All Other
Beneficiaries
For dates
of service on or after October 1, 2000, the FY (CY
for dates of service after December 31, 2017) cap
is $3,000.
2.1.3 Cap
is Met
For beneficiaries
not enrolled in TRICARE Prime, after the FY (CY for
dates of service after December 31, 2017) catastrophic
cap is met, the contractor shall consider the TRICARE
determined allowable amount as paid
in full for all covered services and supplies under TRICARE Standard
and TRICARE Extra for the remainder
of the FY (CY for dates of service after December
31, 2017).
2.2 TRICARE
Prime
Under
TRICARE Prime, in addition to the catastrophic loss protection based
upon the
FY,
Prime enrollees also have an enrollment year catastrophic cap.
As
of January 1, 2018, the protection is based on CY and enrollment
year as they are both the same. See Section 4 for
catastrophic loss protraction guidance for the plan years beginning
January 1, 2018.2.2.1 For TRICARE
Prime enrollees who are ADFMs. Out-of-pocket expenses accrue toward
the $1,000 FY 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 FY (CY for dates of service after December
31, 2017) catastrophic cap.
2.2.3 Through
December 31, 2017, for TRICARE Prime enrollees that
retire other than the first of the month, enrollment in TRICARE
Prime is allowed with no break in coverage.
The enrollment anniversary date is determined
using the existing “20th day of the month” rule. Additional enrollment fees are not 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) are not applied
to the enrollment year catastrophic cap. Out-of-pocket expenditures are applied
to the catastrophic cap as of the enrollment anniversary
date.
2.2.4 Through December
31, 2017, TRICARE Prime enrollees shall pay no more
applicable out-of-pocket expenses for the rest of the FY once
the FY catastrophic cap is met.
Note: For FY 2017 only,
the FY range was extended three months through December 2017 to accommodate
the transition to CY. See Section 4 for
catastrophic loss protraction guidance for the plan years beginning
January 1, 2018.
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
are credited
to a
TRICARE Prime beneficiary’s
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 are not creditable
to the catastrophic cap.
2.3 Double Coverage
For purposes of catastrophic
loss protection, the contractor shall credit the full
deductible and cost-share calculated according to the TRICARE provisions 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: The contractor
shall apply normal double coverage rules, as provided
in
Chapter 4, Section 1,
after
the cap has been reached. The
contractor shall not
charge the beneficiary
a
cost-share after the OHI has made payment.
2.4 TRICARE Supplemental Plans
The contractor
shall ignore TRICARE supplemental plans which provide
coverage for deductibles, cost-shares, and sometimes for non-covered
services. As with double coverage,
the contractor shall credit the full
deductible and cost-share toward meeting
the catastrophic cap.
2.5 Multiple
Family Situations
The
contractor shall treat multiple family situations (e.g.,
sponsor and new spouse and children live together, and sponsor’s
children from previous marriage live elsewhere) as
one family. In other words, for a divorced and then remarried sponsor
with two sets of family members, the contractor shall combine their
deductibles and cost-shares to meet
the catastrophic cap.
Note: When a family’s sponsor changes (e.g.,
a spouse divorces a sponsor and marries another active duty person),
then the contractor shall count only
the new sponsor’s liabilities for deductible and cost-shares in
a FY (CY for dates of service after December 31, 2017) 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
The contractor
shall treat any TRICARE eligible unremarried former
spouse as an “other than ADFM.” For the
purpose of determining the catastrophic cap, the contractor
shall treat a former spouse as
an independent family and the former spouse shall meet
the catastrophic cap independently.
2.7 Change of Sponsor Status
When the sponsor’s
duty status changes, the contractor shall apply the
following to the catastrophic cap.
2.7.1 Claims Subject To The TRICARE
Diagnosis
Related Group (DRG
)-Based
Payment System
2.7.1.1 When the status changes during
a beneficiary’s inpatient stay, the contractor shall
apply the appropriate catastrophic cap 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 contractor
shall base the catastrophic cap upon 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 contractor
shall apply the appropriate catastrophic cap (according
to the sponsor’s current duty status) for
TRICARE eligible families for the remaining FY (CY
for dates of service after December 31, 2017), (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 contractor
shall credit all deductible and cost-shares paid
to meeting the previous family cap toward
the new cap as the sponsor’s liabilities in the same FY
(CY for dates of service after December 31, 2017).
However, when a sponsor’s status changes from
retired to active duty, the contractor shall not adjust previous
claims, even if the aggregate cost-share 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 contractor shall apply the appropriate
cap (according to the sponsor’s current duty status) for
TRICARE eligible families for the remaining FY (CY
for dates of service after December 31, 2017) effective
for services provided after midnight of the day the duty status changes.
The contractor shall credit all deductible
and cost-shares paid toward meeting
the previous family cap to the new
cap as the sponsor’s liabilities in the same FY (CY
for dates of service after December 31, 2017).
2.8 Inpatient Care Spanning Two
Years
When the dates of inpatient
care span different FYs (CY for dates of service after
December 31, 2017), it is absolutely necessary for
accurate catastrophic cap application. If
for a claim the ending date of care is in a different FY
(CY for dates of service after December 31, 2017) from
the beginning date of care, the contractor shall allocate
the beneficiary cost-share amount between
the two periods based upon the dates
of care. For the purpose of the catastrophic cap application only,
the contractor shall apply the following
provisions:
2.8.1 Cost-Share
When Fixed Daily Amount Is Known
When the beneficiary cost-share
is based upon a fixed daily amount
(or when such amount may accurately
be calculated), the contractor shall allocate the actual
daily cost-share amount between the two periods according
to the days of care received in each period.
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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 ADFMs went
up from $512 to $535. We also know that no per diem cost-share amount is 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 contractor
shall calculate the daily cost-share amount 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 allocate the resulting
daily amount between the two periods according
to the days of care received in each period.
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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 The
contractor shall not offer catastrophic loss protection for
the North Atlantic Treaty Organization (NATO)/Partnership for Peace
(PfP) family members.
3.2 The contractor
shall not accrue Extended Care Health Option (ECHO)
sponsor/beneficiary liabilities toward the
catastrophic cap.
3.3 The
contractor shall not count beneficiary costs for
non-covered services or any beneficiary payments above the TRICARE
determined allowable charge toward the
catastrophic cap.
3.4 For TRICARE
Prime enrollees, the contractor shall not cap POS
deductible and cost-share amounts.
4.0 EFFECTIVE DATES
4.1 The FY catastrophic
cap is $7,500 for beneficiaries other than ADFMs effective FY 1993.
Effective October 1, 2000 (FY 2001),
the FY 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 applies to
out-of-pocket expenses incurred on and after November 1, 1995.
4.3 Effective October 1, 1996,
enrollment fees accrue toward the FY 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.
4.5 Effective January
1, 2018, the catastrophic cap is calculated on a CY basis.