Monday, October 13, 2014

Medicare, Tricare and CHAMPVA.

If you retire from the armed services, you and your dependents are eligible for Tricare medical . The two main flavors are Tricare Standard, that is equivalent to an Health Maintenance Organization (HMO), and Tricare Prime, that is equivalent to a Preferred Provider Option (PPO).

Tricare is similar to Medicare, but it also provides prescription drug coverage. Once you reach age 65, you are eligible for Medicare. Medicare Part A covers hospital care and it is provided automatically. To maintain Tricare, you must accept Medicare part B which covers doctor visits. You are then given Tricare for Life as secondary insurance. Your spouse will continue to be covered by Tricare Prime until he or she reaches age 65. Then the spouse will be covered by Tricare for Life, too assuming Medicare Part B is accepted.

With Medicare as primary insurance and Tricare is secondary, there is no need for Medicare Part C or D that provide prescription dug coverage. Tricare for Life covers prescription drugs.

CHAMPVA is very similar to Tricare. In fact, Tricare was originally called CHAMPUS. To be eligible for CHAMPVA:

  1. the spouse or child of a veteran who has been rated for total and permanent disability due to service-connected disability by the VA (that is, a VA regional office)
  2. the widow/widower or child of a veteran who passed away due to a service-connected disability rated by the VA
  3. the widow/widower or child of a veteran who at the time of death, was rated as permanently and totally disabled due to a service-connected disability
  4. the widow/widower or child of a military man or woman who was killed in the line of duty (but not due to bad conduct– often though these will be TRICARE eligible rather than CHAMPVA)
Notice that dependents must have a sponsor who is (100 per cent) totally and permanently disabled or the sponsor passed away from service-connected disability (less than 100 per cent.).

If a vet never received a service connected disability, the survivors would not eligible for CHAMPVA. Of course, the death must be be related to the specific service-connected (SC) disability the VA has awarded.

Likewise the spouse and children may be eligible for Dependent Indemnity Compensation.(DIC) when a disabled veteran passes. The criteria are similar to those for CHAMPVA eligibility.

If a vet dies while a claim is being adjudicated, the survivors of a pending SC claim must open a new Accrued Claim.

Why would a survivor want to reopen an Accrued Claim? If the death is related to the claimed condition, the survivors may be eligible for both CHAMPVA a medical coverage and DIC. Even if the claimed condition is not related to the cause of death, the survivors could receive disability compensation in the form of lump sum payment.

Accrued benefits are only payable if the VA Form 21-534 was filed within one year after the veteran's death.

Once a dependent reached age 65, CHMAPVA becomes secondary insurance as is the case for Tricare. It is called CHAMPVA for Life.

Thee are also Medicare part C & D. Medicare part D does provide prescription coverage, but this private program will become more expensive in the next 10 years. This is because the program was never properly funded by the Congress and it was being subsidized by Standard Medicare FICA payroll tax receipts.

Obama removed the $10 billion subsidy form Part D and rolled the projected revenues into ACA. Medicare Part C that insurers also sell is similar to Part D.

Any vet who has either Tricare for Life or CHAMPVA as secondary insurance does not need Medicare Part C or D.

You an also purchase Medicare Supplemental or MediGap insurance to cover Medicare co-pays. This may be a better and lower cost option than Medicare Part C and D for people who need secondary insurance.

Your local Social Security office should be able to answer any questions you have on Medicare or Medigap. As a retired armed services person or disabled vet, you may have some extra medical entitlements when you reach age 65.

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