Defense proposes health insurance flexibilities for veterans

A new rule proposed by the Defense Department on Tuesday would enable veterans covered by two federal health insurance plans to switch between the plans more freely.

The draft rule was announced in Tuesday's Federal Register. It would lift a restriction requiring veterans eligible for benefits offered by the Veterans Affairs Department and Tricare, the Pentagon's managed care program, to remain with one of the plans during an "episode of care." Current regulations define an "episode of care" as all treatments related to a single injury or illness.

This definition is ambiguous and often leaves health care providers making a final decision on whether doctors' visits are interrelated, the draft regulation noted. The 2003 Defense Authorization Act required the Defense Department to devise a clearer definition, but in Tuesday's draft rule the department eliminates the ban on switching health plans in mid-treatment.

Under the proposed regulation, a beneficiary of both programs could begin treatment for an ailment at a VA health facility and then switch to a Tricare provider at will. The rule does not cover mid-treatment switches in the other direction (from a Tricare to VA provider). To make the benefits completely interchangeable, the Veterans Affairs Department would have to initiate a companion rule, said Stephen Isaacson, a health care program specialist at the Aurora, Colo., Tricare Management Activity Office.

The current regulations were prompted by the congressional directive, and not by complaints about the current system, Isaacson said. Complaints are "very, very rare, frankly," he added. "I'm only aware of one."

Consequently, the draft regulation, if implemented, would likely have little impact on beneficiaries, other than to offer them an additional flexibility, according to Isaacson. For the same reason, the proposed rule is unlikely to encounter much criticism, he said.

The current regulation barring plan switches mid-treatment is intended to prevent veterans from receiving duplicative benefits, the Federal Register announcement said. But this precaution is unnecessary, partly because a substantial number of Tricare beneficiaries are enrolled in the Tricare Prime plan, where a primary care manager oversees medical treatments and would watch for duplicative visits to the doctor, the announcement said.

The comment period on the suggested Tricare changes ends Oct. 20. Send comments by mail to:

TMA Medical Benefits and Reimbursement Systems
16401 East Centretech Parkway
Aurora, Colo.
80011-9043