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Medical Benefits in Retirement – TRICARE For Life and Medicare


If you retire from service, though – even from Reserve or National Guard duty – you may be eligible for continued care into retirement via TRICARE For Life. TRICARE For Life is a supplementary medical insurance program designed for military retirees – even for those who are retired from the Reserves and National Guard.

About Medicare

To understand TRICARE For Life (TFL), you first need to understand a little about Medicare.

Medicare is a federal health insurance program for Americans age 65 or older, or who have been diagnosed with certain chronic medical ailments. It consists of four parts:

Part A

Covers inpatient hospitalization costs. It doesn’t cover long term care, specifically, except in very limited circumstances. It does cover hospitals, hospice care, some home health care service, It’s usually free to the retiree (those who pay a premium pay as much as $451 per month, as of 2012), and most people are automatically enrolled in Medicaid when they turn 65.

Part A covers inpatient care in hospitals (such as critical access hospitals, inpatient rehabilitation facilities, and long-term care hospitals)

  • Inpatient care in a skilled nursing facility (not custodial or long term care)
  • Hospice care services
  • Home health care services
  • Inpatient care in a Religious Nonmedical Health Care Institution

Medicare Part A doesn’t cover everything, even within these categories, though. Frequent or lengthy hospitalizations can still put a crimp on a Medicare beneficiary’s budget – even with military retirement pay. There are copays and deductibles you need to be aware of:

  • Hospital Deductible: $1,156 per spell of illness
  • Hospital Coinsurance: Days 0-60: $0; Days 61-90: $289 per day; Days 91-150: $578 per day
  • Skilled Nursing Facility Coinsurance: Days 0-20: $0; Days 21-100: $144.50 per day

Part B

Part B covers most of the costs associated with physician fees, lab fees and durable medical equipment costs. Typically, Part B will pay 80 percent of the costs of these services, and leave you with 20 percent of the tab, though some services have a higher coinsurance amount. You’re automatically enrolled when you turn 65, in most cases. There is a premium for Part B coverage, though: $99.90 per month. There’s also an annual deductible of $140 every year.

Part C

Medicare Part C, also called Medicare Advantage, is a program that allows Medicaid beneficiaries to access their Medicaid benefits via a private managed care plan. These plans are highly customizable, and allow Medicare beneficiaries to buy plans carefully tailored to meet their own individual circumstances. Premiums, deductibles and covered services vary with the plan.

Part D

Part D covers prescription drugs. You are not automatically enrolled in Part D – you have to opt in. There is a monthly premium and complicated series of deductibles and co-pays, but Part D can provide substantial protection from the high costs of prescription drugs – particularly newer brand name drugs for which no generics are available.

TRICARE For Life Overview

TRICARE for Life is designed for those active duty military retirees who have Medicare Part A, and reserve component military retirees, Medal of Honor recipients, and qualifying family members who have Medicaid Part A and Part B. TFL is designed to kick in where Medicare leaves off – providing coverage for acute medical services not covered under Medicare Part A or B.

TRICARE For Life helps senior retirees by providing substantial coverage of items like these:

  • 100 percent of Medicare Part A hospitalization deductibles and co-pays through day 150, including mental health hospitalizations.
  • Co-insurance under Part B, including the 20 percent on doctor visits, emergency room visits, and durable medical equipment that Part B doesn’t cover.

The result is that TRICARE For Life beneficiaries pay nothing out of pocket for most hospitalizations lasting less than 150 days, and for many routine medical costs and services. The general rule is that if Medicare covers most of it, TRICARE For Life covers the rest of it.

Prescription Drug Coverage

TRICARE For Life covers medically necessary and appropriate prescription drugs. It’s almost never worth it for TFL beneficiaries to buy separate coverage under Medicare Part D, unless the beneficiary qualifies for free or reduced-price Part D coverage because of limited income or assets.

Medicare Supplement Plans and Medicare Advantage

Generally, if you have TRICARE for Life, you don’t need Medicare supplement insurance or Medicare Advantage (Part C) plans, as they would just add additional premium expenses. Generally, you only need Medicare A, B, Part D if you want prescription drug coverage, and perhaps one supplementary plan, such as a Medicare Supplement policy, Medicare Advantage, or TRICARE For Life.

Note: To avoid penalties and maximize your eligibility for benefits, enroll in Part B as soon as you are eligible – especially if you are not an active duty retiree.

Exclusions

TRICARE For Life does not cover long term care benefits, such as adult day care and most ordinary nursing home admissions. But these costs can be significant, and even devastating for many military retirees unless they find some way to pay for needed long term care services. There are other long term care options available.

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