O'Fallon military widow faces increased Tricare coverage costs
Congress is putting the squeeze on spending in the 2016 Defense Department budget, and among those who will feel the pinch will be the beneficiaries of TRICARE, the civilian health benefit program.
TRICARE is expected to see prices increase for its nearly 10 million customers, including upticks in annual enrollment fees and prescription drug co-pays.
The increases are part of the 2016 Pentagon budget. The House approved an amended spending plan nearly two weeks ago; the Senate overwhelmingly approved the revised bill last week and sent it to President Obama to sign into law.
TRICARE, which is run by the Defense Department and supported by tax dollars, serves military families and retirees and relies on health-care providers in the private sector.
Premiums for young adults ages 23-26 receiving coverage under their parents’ insurance are scheduled to jump by as much as 47 percent. The premiums are set to increase on Jan. 1 to $306 per month for TYA Prime, and $228 per month for TYA Standard.
The National Defense Authorization Act is set to take effect when Obama signs the bill, which could occur any time. When it does, it will signal the fourth round of TRICARE cost increases in five years.
What rankles TRICARE customers, especially older retirees, is that the trend toward ascending fees undercut a fundamental promise many believe was made to them when they joined the military.
Richard Hulse, 89, who retired after 24 years in the Air Force, said his recruiter promised him free health care for life when he signed up for a military career. The impending TRICARE cost increases undercut that promise, in Hulse’s view.
“It’s a screwed-up mess,” said Hulse of Collinsville. “It’s supposed to be free.”
Considering the sacrifices they’ve made and the dangers they’ve been exposed to, I don’t think they should have prices raised any more than the legitimate inflation rate.
Rob Robertson, a veteran from Belleville
Rob Robertson, 85, a retired Navy captain, agreed with Hulse that veterans shouldn’t be saddled with TRICARE cost increases.
“Considering the sacrifices they’ve made and the dangers they’ve been exposed to, I don’t think they should have prices raised any more than the legitimate inflation rate,” said Robertson, of Belleville.
Steve Strobridge, the government relations director for the Military Officers Association of America, acknowledged the U.S. government never made an explicit promise to recruits to provide lifetime medical care for free.
“The reality is what they were promised was access to health care for life,” Strobridge said. “At the time they were making it, that was all delivered through military facilities. And we had military facilities all across the country.”
However, with the military draw-down and the slew of base closures in recent decades, he said, “A lot of those military hospitals and clinics disappeared.”
Some drug costs escalating
Under the proposed Department of Defense budget, TRICARE generic drugs will still be obtained for free by mail, while the co-pay for a 90-day prescription for brand-name drugs would jump to $20, compared with the current $16. Medications not on TRICARE’s list of approved drugs would increase to $49, up from $46.
TRICARE customers will see co-payments on a short-term generic prescription climb to $10 from the current $8. Brand name prescription drugs will jump to $24, compared with the current $20.
Meanwhile, prescription medications would still be available at no cost to customers using military pharmacies, such as the one at Scott Air Force Base.
The most recent U.S. Senate version of the spending bill called for a series of TRICARE increases taking place through the next decade. That provision was removed from the bill’s final version.
Strobridge, however, said he expects to continue to see more fights over the issue of TRICARE payments increasing because, “There is certainly a desire to see that in the Pentagon, and I think there is some expectation of that in Congress.”
The office of U.S. Sen. Dick Durbin, D-Ill., the ranking Democrat on the Senate’s powerful Defense Appropriations Subcommittee, recently issued a statement in which he said that Congress “is expected to take a more comprehensive look at military health care next year as part of the National Defense Authorization Act.”
Durbin will “will carefully evaluate any proposals for TRICARE in order to ensure that they maintain the nation’s fundamental commitment to service members and their families in a fair and sustainable way,” according to the statement.
A provision in the defense bill on Obama’s desk calls for the Senate Armed Services Committee to look at broader TRICARE reforms in next year’s budget, and “that higher fees will be part of that,” Strobridge said. “That gives us some concern.”
Strobridge’s concern is amplified by the fact that TRICARE’s costs are under control, and have remained flat or have even fallen over the past five years.
“We just want to make sure that people consider the facts and not just the rhetoric,” he said.
Under the proposed Department of Defense budget, TRICARE generic drugs will still be obtained for free by mail, while the co-pay for a 90-day prescription for brand-name drugs would jump to $20, compared with the current $16. Medications not on TRICARE’s list of approved drugs would rise to $49, up from $46. Co-payments on a short-term generic prescription will climb to $10 from the current $8. Brand name prescription drugs will jump to $24, compared with the current $20.
Roger Muirhead, a retired Scott Air Force Base pilot who lives in Swansea, acknowledged that he signed up for the military with the belief he would get free medical care for life.
“I know that’s not realistic anymore,” Muirhead said, “but the cost increases do concern me. The military is after big cost increases so they can buy another fighter jet. And that really concerns me.”
But Marye Lion, 83, of O’Fallon, the widow of a retired Air Force weather forecaster, took the proposed TRICARE price increases in stride.
“I really don’t think it’s going to be a problem for me,” said Lion, who takes five different medications a day.
Despite the proposed price increases, TRICARE is still a good value, Lion said.
“All of my doctors’ appointments are free,” she said. “How can you complain, you know?”
Families enrolled in the health maintenance organization called TRICARE Prime will see their annual enrollment fees rise $10 to $565, compared with the current $555.
Kevin Dwyer, a TRICARE spokesman, declined to comment on the proposed changes, saying it is TRICARE’s policy not to discuss pending legislation.
Program a bargain to some
For Marc Miller, 59, who retired as a lieutenant colonel in the Army in 1998, the proposed increases are something he and his wife take in stride.
“It bothers me that it is going up,” said Miller, of Shiloh. “I would always say that it wouldn’t bother me as much as long as I’m saving money compared either to commercial insurance from my employer or having to go on a lot of the health-care exchanges.”
Miller, who works at a technology job in St. Louis, noted that he and his wife are paying slightly less than $500 per year for TRICARE coverage.
“If I went to commercial insurance it would be quite an increase,” Miller said. “Honestly, if they doubled the premium it would still be a decent deal compared to what it costs me to buy it from my employer.”
People unfamiliar with TRICARE or the military way of life might be fooled by the big cost differences, at least on paper, between civilian health insurance programs and the less-expensive TRICARE program.
What civilians “forget is that military people pay their premiums upfront and in-kind through decades of service and sacrifice,” said Strobridge, of the military officers group. “You can’t just compare what military people pay to what civilians pay. I’ve always said if you want a real comparison, see how many of those civilians are willing to go to the local recruiter and sign up for 20 years and go to Iraq a few times. That’s when they realize the real premium that military people pay.”
Express Scripts, based in St. Louis, handles TRICARE’s prescription drug program. The pharmaceutical giant has quietly pursued a strategy of cost savings by pushing customers away from their neighborhood pharmacies and toward obtaining their medications via its mail-order program.
“It’s a really important way for the DoD to manage their prescription drug spending while providing beneficiaries access to these medications they very much need,” said Jennifer Luddy, an Express Scripts spokeswoman.
The increase in TRICARE co-pays takes place at a time when prescription drug costs in the commercial insurance market are soaring.
What civilians forget is that military people pay their premiums upfront and in-kind through decades of service and sacrifice. You can’t just compare what military people pay to what civilians pay.
Steve Strobridge, Military Officers Association of America
Express Scripts’ 2014 Drug Trend Report shows that commercial spending on prescription medications shot up by 13.1 percent in 2014 — the fastest rate in a decade. The trend is driven by brand price inflation and the increased use of specialty medications.
What’s more, average brand name drug prices soared 127 percent from 2008-2014, while generic prices dropped by 62 percent. This compares to the national inflation rate, which was 11.2 percent over the same time period, according to the report.
Candace Hoffman, of Edwardsville, whose husband retired from the Army in 1986, expressed disappointment that TRICARE plans to keep raising its prices and amount of customer co-pays for the decade ahead.
“I pretty much think the die is cast. I don’t think we have any say in it whatever,” Hoffman said. “We are just upset with all the things we were promised. Free medical. And the commissary.”
The real issue for TRICARE is the Pentagon’s lack of control of weapons costs, according to Strobridge.
“A lot of people are saying we need to cut personnel costs so we can put more money into weapons,” he said. “I think that’s exactly what’s driving it. And our point is, ‘Wait a minute.’ There hasn’t been much to control weapons costs, when an aircraft costs billions of dollars and a bomber costs half a billion dollars,” he said.
“What happened to the interest in controlling those costs? Those are the ones that are spiraling. It’s not health-care costs.”