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DoD to Demonstrate Health Care for Medicare-eligible

By Douglas J. Gillert
American Forces Press Service

WASHINGTON, Sept. 12, 1996 – Military retirees over age 65 got good news Sept. 11 concerning their health care: Announcement of a DoD demonstration of increased access to military medical facilities for Medicare-eligible beneficiaries.

Medicare Demonstration of Military Managed Care will test expanded care to older retirees. Under the provisions of the demonstration, the care cannot increase costs to DoD or the Department of Health and Human Services, which administers Medicare.

DoD officials said they expect Congress to enact enabling legislation this year. The demonstration will begin either 60 days following enactment or Jan. 1, 1997, whichever is later.

The demonstration will cover four sites in two regions of DoD's health care program, TRICARE. These include San Antonio, Texas, in Region 6 and the Tacoma-Bremerton, Wash., area in Region 11. The department will select three more locations in Region 6 to serve as comparison sites.

"Our Medicare and DoD dual-eligible beneficiaries have long asked that they be able to use the Military Health Services System as their health care provider," said Dr. Stephen Joseph, assistant secretary of defense for health affairs. "This demonstration will help to establish whether this is a workable, affordable option."

Federal law always has allowed treatment of beneficiaries, regardless of age, on a space-available basis in military facilities. However, DoD facilities could not receive reimbursement from Medicare for patients over 65. For the past several years, DoD advocated changing the law to receive what it calls "Medicare subvention" -- financial reimbursement for elderly patients. Until now, however, the department failed to find a means of satisfying Medicare that its trust fund wouldn't be depleted by the move.

Now, DoD and the Department of Health and Human Services have agreed on how to implement subvention. If successful, the initiative will allow DoD to expand health care options for Medicare-eligible beneficiaries, improve care for older retirees and their family members and still meet military readiness requirements. Officials said the initiative will produce savings for the Medicare trust fund by providing health care to military Medicare-eligibles at a lower cost.

For the demonstration, Medicare will pay for dual-eligible patients enrolled in TRICARE's Prime option after DoD depletes its own money budgeted for delivery of the care. Medicare will reimburse DoD at an average adjusted per capita rate not to exceed $65 million a year.

To participate in the demonstration, people must meet the following criteria:- Be eligible for care from DoD and Medicare's aged program;
- Be enrolled in TRICARE Prime;
- Be covered by Medicare Part B;
- Agree to receive covered services only through TRICARE;
- Reside in a geographical area where enrollment in the demonstration is offered;
- Must have used a military medical treatment facility before July 1, 1996, or become dual-eligible (for DoD and Medicare aged program health care) after June 30, 1996. ##

"This is a giant step in the right direction for us to be able to care for our older beneficiaries," Joseph said. "It is a great day for military medicine."

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