82 FR 45438 - Establishment of TRICARE Select and Other TRICARE Reforms
DEPARTMENT OF DEFENSE Office of the Secretary
Federal Register Volume 82, Issue 188 (September 29, 2017)
Page Range
45438-45461
FR Document
2017-20392
This interim final rule implements the primary features of section 701 and partially implements several other sections of the National Defense Authorization Act for Fiscal Year 2017 (NDAA-17). The law makes significant changes to the TRICARE program, especially to the health maintenance organization (HMO)-like health plan, known as TRICARE Prime; to the preferred provider organization (PPO) health plan, previously called TRICARE Extra which is to be replaced by TRICARE Select; and to the third health care option, known as TRICARE Standard, which will be terminated as of December 31, 2017, and also replaced by TRICARE Select. The statute also adopts a new health plan enrollment system under TRICARE and new provisions for access to care, high value services, preventive care, and healthy lifestyles. In implementing the statutory changes, this interim final rule makes a number of improvements to TRICARE.
Federal Register, Volume 82 Issue 188 (Friday, September 29, 2017)
[Federal Register Volume 82, Number 188 (Friday, September 29, 2017)]
[Rules and Regulations]
[Pages 45438-45461]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2017-20392]
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DEPARTMENT OF DEFENSE
Office of the Secretary
32 CFR Part 199
[Docket ID: DOD-2017-HA-0039]
RIN 0720-AB70
Establishment of TRICARE Select and Other TRICARE Reforms
AGENCY: Office of the Secretary, Department of Defense (DoD).
ACTION: Interim final rule.
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SUMMARY: This interim final rule implements the primary features of
section 701 and partially implements several other sections of the
National Defense Authorization Act for Fiscal Year 2017 (NDAA-17). The
law makes significant changes to the TRICARE program, especially to the
health maintenance organization (HMO)-like health plan, known as
TRICARE Prime; to the preferred provider organization (PPO) health
plan, previously called TRICARE Extra which is to be replaced
[[Page 45439]]
by TRICARE Select; and to the third health care option, known as
TRICARE Standard, which will be terminated as of December 31, 2017, and
also replaced by TRICARE Select. The statute also adopts a new health
plan enrollment system under TRICARE and new provisions for access to
care, high value services, preventive care, and healthy lifestyles. In
implementing the statutory changes, this interim final rule makes a
number of improvements to TRICARE.
DATES: This interim final rule is effective October 1, 2017. Comments
will be received by November 28, 2017.
ADDRESSES: You may submit comments, identified by docket number and
title, by any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Mail: Department of Defense, Office of the Deputy Chief
Management Officer, Directorate for Oversight and Compliance,
Regulatory and Advisory Committee Division, 4800 Mark Center Drive,
Mailbox #24, Suite 08D09B, Alexandria, VA 22350-1700.
Instructions: All submissions received must include the agency
name, docket number, or title for this Federal Register document. The
general policy for comments and other submissions from members of the
public is to make these submissions available for public viewing on the
Internet at http://www.regulations.gov as they are received without
change, including any personal identifiers or contact information.
FOR FURTHER INFORMATION CONTACT: Mr. Mark Ellis, Defense Health Agency,
TRICARE Health Plan, (703) 681-0063.
SUPPLEMENTARY INFORMATION:
I. Executive Summary
A. Purpose of the Interim Final Rule
In implementing section 701 and partially implementing several
other sections of NDAA-17, this interim final rule advances all four
components of the Military Health System's quadruple aim of improved
readiness, better care, better health, and lower cost. The aim of
improved readiness is served by reinforcing the vital role of the
TRICARE Prime health plan to refer patients, particularly those needing
specialty care, to military medical treatment facilities (MTFs) in
order to ensure that military health care providers maintain clinical
currency and proficiency in their professional fields. The objective of
better care is enhanced by a number of improvements in beneficiary
access to health care services, including increased geographical
coverage for the TRICARE Select provider network, reduced
administrative hurdles for TRICARE Prime enrollees to obtain urgent
care services and specialty care referrals, and promotion of high value
services and medications. The goal of better health is advanced by
expanding TRICARE coverage of preventive care services, treatment of
obesity, high-value care, and telehealth. And the aim of lower cost is
furthered by refining cost-benefit assessments for TRICARE plan
specifications that remain under DoD's discretion and adding
flexibilities to incentivize high-value health care services.
B. Legal Authority for the Regulatory Action
This interim final rule is required to implement or partially
implement several sections of NDAA-17, including 701, 706, 715, 718,
and 729. The legal authority for this rule also includes chapter 55 of
title 10, United States Code.
C. Summary of Major Provisions of the Interim Final Rule
The major provisions of the interim final rule are:
[rtarr8] The establishment of TRICARE Select as a self-managed, PPO
option under the TRICARE program. TRICARE Select replaces the TRICARE
Extra and Standard programs and adopts a number of improvements,
including fixed copayments rather than cost shares for covered benefits
provided by a civilian network provider. TRICARE Select beneficiaries
can choose any provider for their healthcare; however, they will enjoy
lower out-of-pocket costs if they choose preferred providers within the
TRICARE civilian network.
[rtarr8] The continuation of TRICARE Prime as a managed care, HMO-
like option under the TRICARE program. TRICARE Prime adopts a number of
changes to conform to specifications in the new law, including
categories of health care services applicable to the determination of
copayment amounts (such as primary care, specialty care, emergency
care).
[rtarr8] Improved access to care, including a codified requirement
that the TRICARE Select health care plan is available in all locations
and at least 85% of the U.S. beneficiary TRICARE Select population is
covered by the TRICARE network. Also, for TRICARE Prime enrollees,
there are new procedures to ensure timely appointments for health care
services and to authorize some or all urgent care visits without the
need for referral from a primary care manager.
[rtarr8] Promotion of high value services and medications,
telehealth services, preventive health care, and healthy lifestyles.
[rtarr8] A new design for the health care enrollment system,
including mandatory enrollment to maintain TRICARE coverage, an annual
open season enrollment period, and hassle-free enrollment procedures.
[rtarr8] Other features include preservation of benefits for active
duty dependents and TRICARE-for-Life beneficiaries, and changes to the
TRICARE Young Adult (TYA), TRICARE Reserve Select (TRS), TRICARE
Retired Reserve (TRR), Continued Health Care Benefit Program (CHCBP),
and TRICARE Retiree Dental Program (TRDP) to conform with new statutory
requirements.
II. Provisions of Interim Final Rule
A. Establishment of TRICARE Select
The rule implements the new law (section 701 of NDAA-17) that
establishes TRICARE Select as a self-managed, PPO program. It allows
beneficiaries to use the TRICARE civilian provider network, with
reduced out-of-pocket costs compared to care from non-network
providers, as well as military treatment facilities (when space is
available). Similar to the long-operating ``TRICARE Extra'' and
``TRICARE Standard'' plans, which TRICARE Select replaces, a major
feature is that enrollees will not have restrictions on their freedom
of choice with respect to health care providers. TRICARE Select is
based primarily on 10 U.S.C. 1075 (as added by section 701 of NDAA-17)
and 10 U.S.C. 1097. With respect to beneficiary cost sharing, the
statute introduces a new split of beneficiaries into two groups: One
group (which the rule refers to as ``Group A'') consists of sponsors
and their family members who first became affiliated with the military
through enlistment or appointment before January 1, 2018, and the
second group (referred to as ``Group B'') who first became affiliated
on or after January 1, 2018. In general, beneficiary out-of-pocket
costs for Group B are higher than for Group A.
In addition to implementing the statutory specifications, the
interim final rule also makes improvements for TRICARE Select Group A
enrollees, compared to the features of the old TRICARE Extra plan. One
such improvement is to convert the current cost-sharing requirement of
15% for active duty family members and 20% for retirees and their
family members of the allowable charge for care from a network provider
to a fixed dollar
[[Page 45440]]
copayment calculated to approximately equal 15% or 20% of the average
allowable charge for the category of care involved. Consistent with
prevailing private sector health program practices, the fixed dollar
copayment is more predictable for the patient and easier for the
network health care provider to administer. The breakdown of categories
of care (such as outpatient primary care visit, specialty care visit,
emergency room visit, etc.) contained in the rule is the same as the
categories now specified in the statute for Group B Select enrollees.
A second improvement in TRICARE Select (for both Group A and Group
B) is that additional preventive care services that previously were
only offered to TRICARE Prime beneficiaries will now (under the
authority of 10 U.S.C. 1097 and NDAA-17) also be covered for Select
enrollees when furnished by a network health care provider. These are
services recommended by the United States Preventive Services Task
Force and the Health Resources and Services Administration of the
Department of Health and Human Services.
These improvements are based partly on the statutory provision (10
U.S.C. 1075(c)(2)) that Group A Select enrollee cost-sharing
requirements are calculated as if TRICARE Extra were still being
carried out by DoD. TRICARE Extra specifications are based on the
underlying authority of 10 U.S.C. 1097, which allows DoD to adopt
special rules for the PPO plan. This statute was the basis for the
original set of rules for TRICARE Extra, which were adopted in 1995,
and is the authority for these improved rules for TRICARE Select Group
A, adopted as if TRICARE Extra were still being carried out by DoD.
Under the interim final rule, the cost sharing rules applicable to
TRICARE Select Group B are those specified in 10 U.S.C. 1075. For
TRICARE Select Group A, in addition to the copayment rules noted above,
consistent with 10 U.S.C. 1075, an enrollment fee of $150 per person or
$300 per family will begin January 1, 2021, for most retiree families,
with annual updates thereafter based on the cost of living adjustment
(COLA) applied to retired pay. At the same time, the catastrophic cap
will increase from $3,000 to $3,500 for these retiree families. These
changes, however, will not apply to TRICARE Select Group A active duty
families, survivors of members who died while on active duty, or
disability retiree families; that is, no enrollment fee will be
applicable to this group and the applicable catastrophic cap will
continue to be $1,000 for active duty families as established under 10
U.S.C. 1079(b) and $3,000 for survivors of members who died while on
active duty or disability retiree families as established under 10
U.S.C. 1086(b).
B. Continuation of TRICARE Prime
A second major feature of this interim final rule, based primarily
on 10 U.S.C. 1075a (also added by section 701 of NDAA-17), is the
continuation of TRICARE Prime as a managed care, HMO-like program. It
generally features use of military treatment facilities (MTFs) and
substantially reduced out-of-pocket costs for authorized care provided
outside MTFs. Beneficiaries generally agree to use military treatment
facilities and designated civilian provider networks and to follow
certain managed care rules and procedures. Like with TRICARE Select,
with respect to beneficiary cost sharing, the statute introduces a new
split of beneficiaries into two groups (again referred to in the rule
as Group A and Group B) based on the military sponsor's initial
enlistment or appointment before January 1, 2018 (Group A), or on or
after that date (Group B). Beneficiary cost sharing for Group B is
slightly higher than for Group A.
As with TRICARE Select, the cost sharing specifications for TRICARE
Prime Group B are set forth in the statute, and those for Group A are
calculated in accordance with other health care provisions of title 10
(rather than the new section 1075a). The primary original statutory
authority for the TRICARE Prime health plan, established by DoD
regulation in 1995, was 10 U.S.C. 1097, and this continues to be relied
upon for the continued operation of TRICARE Prime for Group A. Also
relevant to the original terms of TRICARE Prime was section 731 of the
National Defense Authorization Act for Fiscal Year 1994. That law
required DoD to include, to the maximum extent practicable, the HMO-
like option under TRICARE. That law also required that the HMO-like
option ``shall be administered so that the costs incurred by the
Secretary under the TRICARE program are no greater than the costs that
would otherwise be incurred'', to provide health care to beneficiaries.
The extent to which this ``cost neutrality'' requirement has not been
maintained was recently highlighted by the Congressional Budget Office:
``CBO estimates that under current law, a typical retiree household
enrolled in TRICARE Prime as a `family' in 2018, and for whom TRICARE
is the primary payer of health benefits, will cost DoD about $17,400,
and a typical family that uses Standard/Extra will cost DoD about
$12,700.'' \1\
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\1\ Congressional Budget Office Cost Estimate, S. 2943, National
Defense Authorization Act for Fiscal Year 2017, June 10, 2016, page
17.
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Based on the TRICARE Prime cost neutrality provision in NDAA-1994,
the original 1995 TRICARE Prime regulation included (at 32 CFR
199.18(g)) that cost sharing requirements ``may be updated for
subsequent years to the extent necessary to maintain compliance with
statutory requirements pertaining to government costs.'' Since NDAA-
1994, Congress took away DoD's discretion for enrollment fee increases,
which are now tied by law to the retired pay COLA. However, DoD
continues to have discretion to update copayment amounts--which have
not changed since 1995--and this discretion is confirmed by the newly
enacted 10 U.S.C. 1075a(a)(3).
This discretion to update copayment amounts is continued in the
interim final rule, but the framework for setting Prime Group A
copayment amounts is being revised. Specifically, DoD is adopting for
Group A the same structure of categories of care that Congress adopted
for Group B. Thus, for example, while the current TRICARE Prime
copayment amount makes no distinction between primary care and
specialty care services, the new Group B structure under the statute
does have a different copayment for primary care and specialty care.
Under the rule, copayment amounts for Group A beneficiaries will be set
for each of those categories, as well as the other categories of care
the statute now specifies for Group B enrollees. The interim final rule
does not specify the amount for each category of care. Rather,
consistent with DoD's discretion under current statute and regulation,
the actual amount will be set each year prior to open season
enrollment. The interim final rule does, however, specify that the
amount for each category of care for Group A enrollees may not exceed
the amount that Congress set for Group B enrollees. In this way, the
Prime copay structure would be in alignment with proposed legislative
changes recommended by the Department to Congress for enactment this
year to eliminate the ``grandfathering'' of Group A retiree families
and return to a single TRICARE Prime model for all working-age retiree
families. Again, it should be noted that this applies only to per-
service copayments; enrollment fee increases for Group A enrollees will
continue to be based on the retired pay COLA.
[[Page 45441]]
The interim final rule also continues the point-of-service
provision of the current TRICARE Prime plan. Any health care services
obtained by a Prime enrollee not in accordance with the rules and
procedures of Prime (e.g. failure to obtain a primary care manager
referral when such a referral is required or seeing a non-network
provider when a network provider is available) will not be paid for
under Prime rules, but may be covered by the point-of-service option.
This results in higher cost sharing--specifically, a deductible of $300
per person and $600 per family, and a copayment of 50 percent of the
allowable charges after the deductible. Point-of-service charges do not
count against the annual catastrophic cap. These point-of-service rules
continue for TRICARE Prime Group A and are also applicable to Group B.
For Group B, the rules for point-of-service charges are specified in 10
U.S.C. 1075a(c), which clarifies that point-of-service cost sharing is
``notwithstanding'' the usual cost sharing rules of Prime Group B
enrollees.
One other matter on which the interim final rule preserves DoD
discretion, similar to that in the current regulation, is with respect
to the locations where TRICARE Prime is offered. This is noted in the
current regulation at 32 CFR 199.17(a)(5). Under the interim final
rule, the locations where TRICARE Prime will be offered will be
determined by the Director, Defense Health Agency (DHA) and announced
prior to the annual open season enrollment period. The guiding
principle for this decision is that the purpose of TRICARE Prime is to
support the medical readiness of the armed forces and the readiness of
medical personnel. Codification in regulation of this guiding principle
is a corollary to the codification by Congress in statute, specifically
sections 703 and 725 of NDAA-17 that MTFs exist to support the medical
readiness of the armed forces and the readiness of medical personnel.
TRICARE Prime, especially for working age retirees and family
members, provides MTFs clinical workload, including for a range of
medical specialty areas that permit military health care providers to
maintain currency and proficiency in their respective clinical fields.
This important support of a ready medical force is what justifies the
higher government cost of Prime (which CBO estimates at $17,400 per
retiree family), notwithstanding the original statutory requirement of
cost neutrality between TRICARE Prime and TRICARE Standard. This cost-
benefit assessment supports the conclusion that it is practicable to
offer TRICARE Prime in areas where it supports the medical readiness of
one or more MTFs. Additionally, where TRICARE Prime is offered, it may
be limited to active duty family members if the Director, DHA
determines it is not practicable to offer TRICARE Prime to retired
beneficiaries as well--a determination that again would take into
account the nature of the supported MTF and the range of services it
offers.
C. Improved Access to Care
A third significant change in the interim final rule is a set of
improvements in standards for access to care. The TRICARE Select plan
replaces TRICARE Standard as the generally applicable plan in all
areas. Under TRICARE Select, eligible beneficiaries can choose any
provider for their healthcare, and they will enjoy lower out-of-pocket
costs if they choose providers within the TRICARE civilian network. The
vast majority of TRICARE beneficiaries located in the United States
will have access to TRICARE network providers (it is DoD's plan that at
least 85% of the U.S. beneficiary population under TRICARE Select will
be covered by the network upon implementation), similar to the current
TRICARE Extra option, but with the benefit of predictable fixed dollar
copayments. In cases in which a network provider is not available to a
TRICARE Select enrollee, such as in remote locations where there are
very few primary or specialty providers, enrollees will still have
access to any TRICARE authorized provider, with cost sharing comparable
to the current TRICARE Standard plan (i.e. 25% for retired category
beneficiaries).
A second interim final rule enhancement for access to care is that
if a TRICARE Prime enrollee seeks to obtain an appointment for care
from the managed care support contractor but is not offered an
appointment within the applicable access time standards from a network
provider, the enrollee will be authorized to receive care from any
authorized provider without incurring the additional fees associated
with point-of-service care.
A third access to care improvement under the interim final rule is
that the TRICARE Prime referral requirement may be waived for urgent
care visits for Prime enrollees other than active duty members. This is
similar to the current pilot program, which waives the referral
requirement (other than for active duty members) for up to two urgent
care visits per year. The specific number of urgent care visits without
a referral will be determined annually prior to the beginning of the
open season enrollment period.
A fourth access to care improvement is adoption of the new
statutory provision that a primary care manager who believes a referral
to a specialty care network provider is medically necessary and
appropriate need not obtain pre-authorization from the managed care
support contractor. Managed care support contractor preauthorization is
only required with respect to a primary care manager's referral for
inpatient hospitalization, inpatient care at a skilled nursing
facility, inpatient care at a residential treatment center and
inpatient care at a rehabilitation facility.
D. Promotion of High Value Services and Medications and Telehealth
Services
In addition to the expansion noted above concerning preventive care
services, the interim final rule makes a number of other improvements
in TRICARE Prime and TRICARE Select based on provisions of sections
701(h), 706, 718, and 729 of NDAA-17. Section 701(h), among other
things, provides for a four-year pilot program to encourage use by
patients of high value services and medications. Section 706, among
other things, authorizes special arrangements with provider groups that
will improve population-based health outcomes and focus more on
preventive care. Section 729 calls for special actions to incentivize
medical intervention programs to address chronic diseases and other
conditions and healthy lifestyle interventions. Section 718, among
other things, requires actions to promote greater use of telehealth
services under TRICARE. While these sections of NDAA-17 also require
actions outside the scope of this interim final rule (such as
contracting actions) they can be partially implemented, consistent with
Congressional intent, in this rule. The interim final rule does this in
several ways.
First, the interim final rule authorizes coverage under TRICARE
Prime and TRICARE Select for medically necessary treatment of obesity
even if it is the sole or major condition treated. Under 10 U.S.C.
1079(a)(10), this is disallowed under the basic program. However, it is
DoD's conclusion that the underlying authority of 10 U.S.C. 1097,
together with section 729 of NDAA-17 (which specifically authorizes
medical intervention for obesity), allow the Department to cover these
services when provided by a network provider
[[Page 45442]]
for a TRICARE Prime or TRICARE Select enrollee.
Second, the interim final rule codifies authority of the Director,
DHA to waive or reduce copayment requirements for TRICARE Prime and
TRICARE Select enrollees for care received from network providers for
certain health care services that provide especially high value in
terms of better health outcomes for patients. Authority for this
includes section 706 and 729 of NDAA-17. This is also consistent with
the four-year pilot program authority of section 701(h), but does not
necessarily rely on that time-limited authority. Consistent with the
intent of these sections, the Department also intends to use the
authority of Sec. 199.21(j)(3) of the TRICARE Pharmacy Benefits
Program section of the TRICARE regulations to encourage use of high
value medications by reducing or eliminating the copayment of selected
medicines.
Third, consistent with section 718 of NDAA-17, the interim final
rule provides that health care services covered by TRICARE and provided
through the use of telehealth modalities are covered services to the
same extent as if provided in person at the location of the patient if
those services are medically necessary and appropriate for such
modalities. The Director, DHA will establish standardized payment
methods to reimburse for such services, and shall reduce or eliminate,
as appropriate, beneficiary copayments or cost-shares for such services
in cases in which a copayment would otherwise apply. This may be done
by designating some telehealth services as high value services for
which lower copays apply as well as the elimination of any beneficiary
cost-sharing related to originating site fees when used to support the
provision of telehealth services.
E. Changes to Health Plan Enrollment System
A fourth major change in the interim final rule is its
implementation of the new statutory design for the health care
enrollment system. Starting in calendar year 2018, beneficiaries other
than active duty members and TRICARE-for-Life beneficiaries must elect
to enroll in TRICARE Select or TRICARE Prime in order to be covered by
the private sector care portion of TRICARE. While TRICARE-for-Life
beneficiaries under the age of 65 are permitted to enroll in TRICARE
Prime under limited circumstances, their failure to enroll will not
affect their coverage by the private sector care portion of TRICARE.
Enrollment will be done during an open season period prior to the
beginning of each plan year, which operates with the calendar year. An
enrollment choice will be effective for the plan year. As an exception
to the open season enrollment rule, enrollment changes can be made
during the plan year for certain qualifying events, such as a change in
eligibility status, marriage, divorce, birth of a new family member,
relocation, loss of other health insurance, or other events.
Eligible Prime or Select beneficiaries who do not enroll will no
longer have private sector care coverage under the TRICARE program
(including the TRICARE retail pharmacy and mail order pharmacy
programs) until the next open enrollment season or they have a
qualifying event, except that they do not lose any statutory
eligibility for space-available care in military medical treatment
facilities. There is a limited grace period exception to this
enrollment requirement for calendar year 2018, as provided in section
701(d)(3) of NDAA-17, to give beneficiaries another chance to adjust to
this new requirement for annual enrollment. For the administrative
convenience of beneficiaries, there are also procedures for automatic
enrollment in Prime and Select for most active duty family members, and
automatic renewal of enrollments of covered beneficiaries, subject to
the opportunity to decline or cancel.
Due to a compressed implementation schedule that precludes an
annual open season enrollment period in calendar year 2017 for existing
TRICARE beneficiaries to elect or change their TRICARE coverage, the
Department will convert existing TRICARE Standard coverage to TRICARE
Select coverage effective January 1, 2018. All other existing TRICARE
coverages will be renewed effective January 1, 2018. As noted
previously, beneficiaries may elect to change their TRICARE coverage
anytime during the limited grace period in calendar year 2018.
F. Additional Provisions of Interim Final Rule
The interim final rule has several other noteworthy provisions.
First, there are no changes in benefits for TRICARE-for-Life
beneficiaries, or generally in cost sharing levels for active duty
family members. Second, although ``TRICARE Standard'' is terminated as
a distinct TRICARE plan as of December 31, 2017, basic program benefits
(as established under 32 CFR 199.4) continue under both TRICARE Prime
and TRICARE Select. In addition, when a TRICARE Select beneficiary
receives services covered by the basic program benefits from an
authorized health care provider who is not part of the TRICARE provider
network, that care is covered by TRICARE as ``out-of-network'' care
under terms that match the old TRICARE Standard plan. Third, in order
to transition enrollment fees, deductibles, and catastrophic caps from
a fiscal year basis to a calendar year basis, special rules apply for
the last quarter of calendar year 2017, including that a Prime
enrollee's enrollment fee for the quarter is one-fourth of the
enrollment fee for fiscal year 2017, and the deductible amount and the
catastrophic cap amount for fiscal year 2017 will be applicable to the
15-month period of October 1, 2016, through December 31, 2017. A
similar transition rule will apply to TRICARE for Life, TYA, TRR and
TRS to align remaining program deductibles and/or catastrophic caps
from a fiscal year to calendar year basis for consistency and ease of
administration.
Additionally, the interim final rule adopts several changes to
regulatory provisions applicable to the TYA, TRS, TRR, and TRDP
programs to conform with new statutory requirements. In implementing
section 701(a) of NDAA-17, together with section 701(j)(1)(F), the rule
conforms the TYA regulation to the statutory language which established
the eligibility of TYA under 10 U.S.C. 1110b to enroll in TRICARE
Select and provided that the TYA premium shall apply instead of the
otherwise applicable TRICARE Prime or Select enrollment fee. In
implementing section 701(j)(1)(B), the rule conforms the TRICARE
Reserve Select plan regulation to the statutory language which defines
``TRICARE Reserve Select'' as the TRICARE Select self-managed,
preferred-provider network option under 10 U.S.C. 1075 made available
to beneficiaries under 10 U.S.C. 1076d and requires payment of a
premium for coverage instead of the TRICARE Select enrollment fee. In
implementing section 701(j)(1)(C), the rule conforms the TRICARE
Retired Reserve plan regulation to the statutory language which defines
``TRICARE Retired Reserve'' as the TRICARE Select self-managed,
preferred-provider network option under 10 U.S.C. 1075 made available
to beneficiaries under 10 U.S.C. 1076e and requires payment of a
premium for coverage instead of the TRICARE Select enrollment fee. In
implementing section 701(a) and 701(e), the rule conforms the CHCBP
regulation to replace TRICARE Standard with TRICARE Select as the
continuation health care benefit for Department of Defense and the
other uniformed services beneficiaries losing eligibility.
[[Page 45443]]
In implementing section 715, the rule conforms the TRDP regulation to
the statutory language which authorizes an interagency agreement
between the Department of Defense and the Office of Personnel
Management to allow beneficiaries otherwise eligible for the TRDP to
enroll in a dental insurance plan offered under the Federal Employees
Dental and Vision Insurance Program. Under the statute, TRDP
beneficiaries will have the opportunity to access a dental plan with
significantly higher annual maximum benefit and a lower premium cost
than available under the current TRDP, while giving the Department an
opportunity to eliminate costs associated with procuring and
administering a separate TRDP contract.
Also, the interim final rule adopts several changes to regulatory
provisions applicable to benefit coverage of medically necessary food
and vitamins. Section 714 of NDAA-17 confirms long-standing TRICARE
policy authorizing benefit coverage of medically necessary vitamins
when prescribed for management of a covered disease or condition. In
addition, while section 714 confirms long-standing TRICARE policy
authorizing medical nutritional therapy coverage of medically necessary
food and medical equipment/supplies necessary to administer such food
when prescribed for dietary management of a covered disease or
condition, the law also allows the medically necessary food benefit to
include coverage of low protein modified foods. Consistent with this we
also recognize the role of Nutritionists and Registered Dieticians in
the appropriate planning for the use of medically necessary foods.
Additionally, the interim final rule adopts several conforming
changes to regulatory provisions applicable to general TRICARE
administration, the TRICARE Pharmacy Benefits Program and the Extended
Health Care Option to reflect transition of deductibles, catastrophic
caps, and program reimbursement limitations, as applicable, from a
fiscal year basis to a calendar year basis for consistency and ease of
administration. Simultaneously, technical corrections are being made to
the TRICARE Pharmacy Benefits Program to conform regulation provisions
to statutory provisions enacted by section 702 of the National Defense
Authorization Act for Fiscal Year 2016.
Finally, the interim final rule includes authority for the
Director, DHA to establish preferred provider networks in areas outside
the United States where it is determined to be economically in the best
interests of the Department of Defense. As a result of the TRICARE
Philippines Demonstration Project, which commenced in January 1, 2013,
the Department has determined that the TRICARE contracted preferred
provider network established in designated locations in the Philippines
provided adequate access to beneficiaries with 97 percent of care
delivered by network providers. It also successfully achieved the
demonstration goals of reducing aberrant billing activities, reduced
out-of-pocket expenses for beneficiaries, and increased overall
beneficiary satisfaction while leading to a net savings to the
government. Although the demonstration was projected to continue
through December 31, 2018, the Philippines preferred provider network
is determined to be economically in the interests of the Department of
Defense and the demonstration shall terminate effective December 31,
2017, with transition of the demonstration's approved preferred
provider network to a TRICARE Select preferred provider network
effective January 1, 2018.
G. Recap: Cost Sharing Tables
The following two tables summarize beneficiary fees (including
enrollment fees, deductibles, cost sharing amounts, and catastrophic
loss protection limits) under TRICARE Select and TRICARE Prime for
calendar year 2018. For future calendar years, all fees are subject to
review and annual updating in accordance with sections 1075, 1075a, and
1097 of title 10, United States Code. Table 1 is for active duty family
members (ADFMs); Table 2 is for retiree families. As a guide for
understanding the tables:
[rtarr8] For services listed as ``to be determined (TBD)'', the
Director, DHA will ensure the applicable fee for calendar year 2018
will be available at www.health.mil/rates before December 1, 2017.
[rtarr8] For services not specifically addressed in these tables,
applicable cost-sharing requirements shall be established by the
Director, DHA and published annually.
[rtarr8] For services designated as ``IN'', the listed fee is for
covered services or supplies obtained ``in-network,'' meaning received
from TRICARE authorized network providers.
[rtarr8] For TRICARE Prime beneficiaries, if covered services or
supplies are not obtained in accordance with the rules and procedures
of Prime (e.g., failure to obtain a required referral or unauthorized
use of a non-network provider), the services or supplies will be
reimbursed under a point-of-service option for which there is a
deductible of $300 per person or $600 per family and a cost share of 50
percent of the allowable charges after the deductible.
[rtarr8] For services designated as ``OON'', the listed fee for
TRICARE Select beneficiaries is for covered services or supplies
obtained ``out-of-network'', meaning received from non-network TRICARE
authorized providers.
[rtarr8] Certain preventive services have no cost sharing whether
received from network or non-network providers. However, certain
preventive services are not covered services for TRICARE Prime or
Select beneficiaries unless obtained from network providers.
Additionally, TRICARE Prime beneficiaries are required to obtain
services in accordance with the rules and procedures of Prime to avoid
point-of-service charges.
[rtarr8] Enrollment fees and deductibles are listed in the tables
as individual/family, indicating the dollar amounts applicable per
individual or per family.
[rtarr8] The criteria for fees associated with High Value Primary
Care Outpatient Care and High Value Specialty Outpatient Care are under
development but will be designed to encourage beneficiaries to receive
health care services from high-value providers as highlighted in the
contractor's network provider directory. When finalized, the fees will
be made available at www.health.mil/rates.
[rtarr8] Inpatient subsistence refers to the rate charged for
inpatient care obtained in a military treatment facility.
[rtarr8] ``COLA'' is the cost-of-living adjustment for retired pay
under 10 U.S.C. 1401a by which certain fees are required to be annually
indexed.
[rtarr8] ``<'' means less than; <= means less than or equal to.
[[Page 45444]]
Table 1--TRICARE Select and TRICARE Prime Cost Sharing for Active Duty Family Members
for Calendar Year 2018
----------------------------------------------------------------------------------------------------------------
Select Group A Select Group B Prime Group A Prime Group B
ADFMs ADFMs ADFMs ADFMs
----------------------------------------------------------------------------------------------------------------
Annual Enrollment............... $0................ $0................ $0................ $0
Annual Deductible............... E1-E4: $50/$100; E1-E4: $50/$100; 0................. 0
E5 & above: $150/ E5 & above: $150/
$300. $300.
Annual Catastrophic Cap......... $1,000............ $1,000............ 1,000............. 1,000
Preventive Care Outpatient Visit $0................ $0................ 0................. 0
Primary Care Outpatient Visit... Fixed fee to = 15% $15 primary care 0................. 0
of average IN; 20% OON.
allowable amount
IN; 20% OON.
Specialty Care Outpatient Visit. Fixed fee to = 15% $25 specialty care 0................. 0
of average IN; 20% OON.
allowable amount
IN; 20% OON.
High-Value Primary Care Under Development; Under Development; 0................. 0
Outpatient Visit. Less than normal Less than normal
primary care primary care
amount. amount.
High-Value Specialty Care Under Development; Under Development; 0................. 0
Outpatient Visit. Less than normal Less than normal
primary care primary care
amount. amount.
Emergency Room Visit............ Fixed fee to = 15% $40 IN; 20% OON... 0................. 0
of average
allowable amount
IN; 20% OON.
Urgent Care Center.............. Same as primary $20 IN; 20% OON... 0................. 0
care outpatient
amount IN; 20%
OON.
Ambulatory Surgery.............. $25............... $25 IN; 20% OON... 0................. 0
Ambulance Service (not including Fixed fee to = 15% $15 IN; 20% OON... 0................. 0
air). of average
allowable amount
IN; 20% OON.
Durable Medical Equipment....... 15% IN; 20% OON... 10% IN; 20% OON... 0................. 0
Inpatient Hospital Admission.... Subsistence charge/ $60/admission IN; 0................. 0
day, minimum $25/ 20% OON.
admission.
Inpatient Skilled Nursing/Rehab Subsistence charge/ $25/day IN; $50/ 0................. 0
Facility. day, minimum $25/ day OON.
admission.
----------------------------------------------------------------------------------------------------------------
Table 2--TRICARE Select and TRICARE Prime Cost Sharing for Retiree Families for Calendar Year 2018
----------------------------------------------------------------------------------------------------------------
Select Group A Select Group B Prime Group A Prime Group B
Retirees Retirees Retirees Retirees
----------------------------------------------------------------------------------------------------------------
Annual Enrollment............... $0 until 2021; $450/$900......... FY17 amount $350/$700.
$150/$300 in 2021 ($282.60/$565.20)
+COLA? +COLA.
Annual Deductible............... $150/$300......... $150/$300 IN; $300/ $0................ $0.
$600 OON.
Annual Catastrophic Cap......... $3,000 until 2021; $3,500............ $3,000............ $3,500.
$3,500 in 2021.
Preventive Care Visit........... $0................ $0................ $0................ $0.
Primary Care Outpatient Visit... Fixed fee that = $25 primary IN; TBD, <=$20 primary $20 primary.
20% of average 25% OON.
allowable amount
IN; 25% OON.
Specialty Care Outpatient Visit. Fixed fee that = $40 specialty IN; TBD, <=$30 $30 specialty.
20% of average 25% OON. specialty.
allowable amount
IN; 25% OON.
High Value Primary Care OP Visit Under Development; Under Development; Under Development; Under Development;