One quirk of Tricare is its two different names for the annual, quarterly or monthly fees that beneficiaries may pay. In the civilian world, anything you pay regularly just to have health-care coverage is typically called a premium. But Tricare is different. Depending on your status and plan, you may pay either enrollment fees or premiums.
There are different terms for the categories of money you’ll pay Tricare because each works a little differently.
So what’s what, and why should you care? Here’s what you need to know about Tricare fees.
What’s a Tricare Catastrophic Cap?
The key difference between enrollment fees and premiums is whether they count toward your catastrophic cap. A catastrophic cap, sometimes called an out-of-pocket maximum, is the most your family will pay for covered care during any calendar year. Once your family reaches your catastrophic cap, Tricare will pay 100% of the Tricare-allowable cost of any covered care for the rest of the year.
The amount of your catastrophic cap depends on:
Depending on your catastrophic cap level and your family’s health-care use, you may never meet your catastrophic cap in a year. That’s great news because it means you’re paying very little for your annual health care. On the flip side, families with higher medical needs may meet their catastrophic cap for the year as early as January, meaning they’ll pay nothing for covered health care for the rest of the year.
Either way, your catastrophic cap is important to understand, because it gives you an idea of the most you’ll need to spend on covered health care in a year. Many families divide their catastrophic cap by 12 and put that much money in a dedicated savings account each month. Then when you have to pay your deductible or fees for service, you’ll have the money available.
Tricare Enrollment Fees
Who pays Tricare enrollment fees? Retirees and their family members who enroll in either Tricare Prime or Tricare Select pay enrollment fees. These costs are annual, but you may pay them on a more frequent schedule, such as monthly, by having them deducted from military retirement pay.
Do Tricare enrollment fees count toward the catastrophic cap? Yes, anything called an enrollment fee counts toward your family’s catastrophic cap.
Tricare Premiums
Who pays Tricare premiums? Users of Tricare plans that charge for participation — besides Prime and Select — pay premiums (those two charge enrollment fees instead). Premiums apply to Tricare Reserve Select, Tricare Retired Reserve, Tricare Young Adult and Continued Health Care Benefit Program plans. Premiums for CHCBP are quarterly, while the other programs charge monthly premiums.
Do Tricare premiums count toward the catastrophic cap? No, anything called a premium does not count toward your family’s catastrophic cap. This can be a big deal, because premiums can be fairly expensive, depending on which plan you use.
Not All Plans Have a Cost
If you’re an active-duty service member or family member, or if you’re on Tricare for Life, you pay neither an enrollment fee nor a premium. Therefore, you must meet your catastrophic cap through fees for service, such as co-payments or cost shares.
Budgeting for health care generally means budgeting for your catastrophic cap. Knowing whether your annual or monthly Tricare expense counts toward your catastrophic cap is an important part of that math. Figure out whether what you pay is an enrollment fee or a premium so you can apply that to your overall figures, and you’ll have a better sense of your potential medical costs each year.
Related: Understanding Your Tricare Catastrophic Cap
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