Tricare Young Adult Premiums to Rise Sharply in 2021

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A physician assigned to Madigan Army Medical Center at Joint Base Lewis-McChord.
A physician assigned to Madigan Army Medical Center at Joint Base Lewis-McChord, Washington, examines her patient on Nov. 28, 2020. (U.S. Army/John Wayne Liston)

Military dependents who use Tricare Young Adult for their health coverage will see a 12% to 22% rise in their premiums next year depending on which plan they select, according to rates published Monday by Tricare.

The military health program published a Twitter post with the monthly premiums required for Tricare Young Adult Prime and Tricare Young Adult Select next year: $459 per month for TYA Prime and $257 per month for TYA Select.

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Compared with the current monthly enrollment fees of $376 for TYA Prime and $228 for TYA Standard, the new rates correspond to a 22% increase for TYA Prime and nearly 13% increase for those on TYA Standard, or $996 extra per year for Prime and $348 additional per year for Select.

The increases represent an additional cost burden on active-duty and military retiree families with adult children who opt to use the military health program, according to Eileen Huck, deputy director for health care at the National Military Family Association.

"We are extremely concerned about the massive premium increases for Tricare Young Adult, especially TYA Prime. Families who may already be struggling financially are going to have to dig even deeper to protect their children's health care coverage and keep them safe during a pandemic," Huck said.

Dependents are eligible to enroll in the TYA program once they have aged out of Tricare, either on their 21st birthday or their 23rd if they are full-time students. They may remain on TYA until they turn 26. The program was created to ensure that military children had access to their parents' health insurance in line with Affordable Care Act requirements.

Unlike the Affordable Care Act, which allowed adult children to stay on their parents' insurance without adding any extra cost to their family plan, the law that created TYA stated that it must be cost-neutral, meaning the premiums must cover the use and cost of the program.

Therefore, TYA premiums are based on commercial insurance rates and coverage.

The monthly cost of Tricare Young Adult often comes as a shock to military families, since active-duty members don't pay enrollment fees or premiums for Tricare Prime, and retiree families pay either $600 a year for Tricare Prime or no enrollment fees or premiums for Tricare Select.

Next year, however, those rates will change. Tricare has yet to release the 2021 annual enrollment fees for Tricare Prime, which are based on the calculated cost-of-living adjustment for retired military pay. But retirees who use Tricare Select are guaranteed to see their health care costs rise next year. For the first time, they will be required to pay an annual enrollment fee of $150 for single-patient coverage and $300 for a family -- the latter category being a requirement for anyone needing health coverage beyond themselves, including any TYA beneficiaries.

"We're worried about families who may be unable to take on this additional financial burden and now have the added stress of having to worry about their child's health," Huck said.

The Defense Department is engaged in massive reform of its medical system and beneficiary health benefits, focusing the military medical commands on caring for active-duty service members and training medical personnel while the Defense Health Agency manages a Tricare benefit that offers a mix of private care options and military care in locations where private health services are scarce.

Enrollment in TYA has declined in the past several years, from 45,183 in 2016 to 37,339 in 2019, including 10,509 enrolled in TYA Prime and 26,830 enrolled in Select.

Huck said she believes the TYA premium increases are related to the costs of running the program and are "not designed to drive beneficiaries into Select."

However, she added, "the costs are unsustainable."

"We believe something must be done to reduce the cost of TYA to make it affordable for families. TRICARE beneficiaries are the only population who have to pay more to keep their young adult children on their insurance; it's past time to do something about that disparity," Huck said.

Earlier this year, Rep. Elaine Luria, a Democrat and retired Navy officer who is engaged in a tight race for Virginia's 2nd District, introduced a bill that would allow military dependents to stay on Tricare until age 26 without paying monthly premiums.

The bill has six cosponsors, including one Republican, but has not been considered by the House Armed Services Committee.

With enrollment season approaching for changing health care plans, beneficiaries on Tricare Young Adult may want to consider exploring their health care options and comparing plans. In addition to switching from TYA Prime to TYA Select and employer-provided plans, many states offer low-cost health care programs for young adults, and the federal exchange marketplace provides a number of options based on location as well as household income.

Open enrollment for Tricare runs from Nov. 9 to Dec. 14. Open enrollment for the federal marketplace runs from Nov. 1 through Dec. 15.

-- Patricia Kime can be reached at Patricia.Kime@Monster.com. Follow her on Twitter @patriciakime.

Related: Pentagon to Retirees: Plan Now for Tricare Select Enrollment Fees in 2021

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