Popular benefit of health-care law excludes military families

By David Hilzenrath
Wednesday, May 26, 2010

By the time Congress passed the national health-care overhaul, anxiety about it was so widespread that Defense Secretary Robert M. Gates issued a statement reassuring military families. The legislation, Gates said, "will not negatively impact the TRICARE medical insurance program" for members of the armed forces.

Indeed, partly to avoid such criticism, the legislation left Tricare untouched.

Now, some military families have a different concern: They are discovering that a popular and highly publicized benefit of the new law does not apply to them.

Under the law, other Americans are gaining the option of keeping their children on their health insurance plans -- or putting dependents back on their policies -- until they turn 26. But for the most part, Americans covered by Tricare have no such luck.

Teresa Roberts of Alexandria, a retired naval intelligence officer, said she was excited when she heard about the young adult coverage -- and disappointed when she learned it doesn't apply to her daughter, who graduated from college May 8.

"It seems discriminatory to those of us who have military benefits for which we are paying," Roberts said.

Troubled that troops are on the short end of a double standard, lawmakers are tackling the issue. The defense authorization bill pending in the House, which recently was approved by the Armed Services Committee, would give military families essentially the same option as their civilian counterparts. A parallel proposal has been introduced in the Senate.

But making the benefit available to military families could take awhile, said Steve Strobridge, director of government relations for the Military Officers Association of America. Defense authorization bills typically are approved late in the year, and assuming the dependent coverage is adopted, the Pentagon will need additional time to implement it, Strobridge said.

In the meantime, the Obama administration has been publicizing the fact that in the private sector, dozens of health insurance companies are voluntarily implementing the expanded coverage for dependents months ahead of schedule.

Instead of waiting for plan years that begin after Sept. 23 -- the date specified in the legislation (or six months from the law's enactment; for many plans that will mean Jan. 1, 2011) -- companies are allowing new college graduates and other young adults to stay on their parents' health plans this summer.

Tricare provides relatively generous benefits for 9.6 million Americans, but expanded coverage for dependents is one area in which the new health-care law provides more extensive coverage. The proposed Tricare expansion would cover young adults who are not eligible for insurance through an employer.

Under current law, the age limit for dependent children under Tricare is 21, or 23 if the child is enrolled full-time in an institution of higher learning. For an additional fee, the young adults can obtain extended coverage for up to 36 months, but only if they enroll in the continuation program within 60 days of losing Tricare eligibility.

The expansion measure, which was proposed by Rep. Martin Heinrich (D-N.M.) and endorsed by the House Armed Services Committee, calls for the defense secretary to set a premium for extended coverage. The premium could be as much as the projected cost of the medical benefit.

The Congressional Budget Office has estimated that the expanded Tricare coverage would cost $924 million in federal outlays over five years, beginning with $8 million in 2011 and rising to $326 million in 2015. The CBO estimates that the coverage would entail $990 million of spending authorization over the period.

In estimating the cost, the CBO assumed that the Defense Department would subsidize about 75 percent of the cost instead of recouping the full amount through premiums.

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