Over the past several decades, a fragmented array of government programs has emerged to provide health care or health insurance for Americans. Several of these programs serve the veterans and military community, either directly or indirectly, including Department of Defense (DoD) medical care and health insurance, Department of Veterans Affairs (VA) health care and disability compensation; Social Security Disability Insurance (SSDI), Medicare, and others. Over the past several decades, these programs each came into being separately. Consequently, they do not mesh cleanly, and cannot have their interactions easily fixed, because they fall under the jurisdiction of myriad agencies and Congressional oversight committees. This area’s complex political landscape makes reform even more difficult, because each program has large and politically powerful stakeholders.
This working paper examines the overlap of these programs with respect to a specific sub-population: seriously wounded, ill and injured veterans who retire from active military service with disabilities so severe that they cannot work after leaving service. The web of government programs serving this population does not mesh well, creating challenges for veterans as they move between these programs. This set of problems has been described by stakeholders as the “TRICARE-Medicare trap,” which ensnares veterans and their family members who fail to perfectly navigate the system of benefits, potentially losing health coverage or incurring substantial costs and penalties, or both. To better understand this problem, this paper estimates the size of this population and some of its relevant characteristics, including levels of disability compensation. Next, this paper outlines the health choices facing this population after leaving service, including some of the dilemmas created by messy interplay of DoD, VA, SSDI, and Medicare programs. Finally, this paper concludes with several potential solutions for these issues, including:
- Improving data sharing and coordination among agencies, both to identify veterans and families that experience difficulty (and require assistance), and to identify macro-level policy issues that may arise in the future from this fragmented array of benefits programs.
- Decoupling TRICARE from Medicare for severely wounded, ill and injured retirees, such that the nation’s most severely disabled veterans do not have to opt into Medicare Part B in order to obtain TRICARE.
- Eliminating penalties for this category of veterans for delayed enrollment in Medicare Part B, or TRICARE, or vice-versa, creating a more forgiving health care system for this class of severely wounded, ill or injured veterans.
- Enabling movement between systems for veterans as their life circumstances change, such as when veterans return to work.
- Creating cost parity between health care systems such that the most severely wounded, ill or injured veterans do not pay more for their health care than ordinary DoD retirees using TRICARE, or non-retired veterans using the VA or Medicare for their health care.
The full working paper is available online.