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TRICARE and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003

Page last revised Monday Jan 14, 2008.



What is TRICARE?

TRICARE is a regionally managed health care program for active duty and retired members of the uniformed services, their families, and survivors. TRICARE brings together the health care resources of the uniformed services and civilian health care professionals to provide better access and high quality health care service.

TRICARE beneficiaries entitled to Medicare Part A based upon age, disability, or End Stage Renal Disease, are required by law to enroll in Medicare Part B to retain their TRICARE benefits. TRICARE serves as a supplement to Medicare, paying the Medicare deductible and patient cost share. To take advantage of this program, individuals must be entitled to Medicare Part A and Part B. Family members of an active duty service member are NOT required to have Part B. However, when the active duty service member retires, family members with Medicare Part A only are required to enroll in Medicare Part B.


Who is Affected by the New Law?

Uniformed services retirees, their spouses (including eligible divorced spouses, and widows(ers)) and dependent children are affected by the new provisions of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.


How are TRICARE Beneficiaries Affected by the New Law?

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 makes two very important changes regarding enrollment in Medicare Part B for TRICARE beneficiaries.

  • Beneficiaries who are entitled to Medicare Part A but are not enrolled in Medicare Part B may enroll in Part B without a premium surcharge during a special enrollment period.
  • Beneficiaries whose current Medicare Part B entitlement began January 2001 or later and who are paying a premium surcharge (more than the standard premium of $66.60 a month in 2004, $78.20 in 2005, and $88.50 in 2006) for Medicare Part B, are eligible to have their Part B premium reduced to the standard amount beginning January 2004, or if later, their Part B entitlement date. These beneficiaries will receive a refund for any excess premiums they have paid in 2004 and 2005.


When were Beneficiaries Notified About How the New Law Affects Them?

The Social Security Administration (SSA) worked very closely with the Centers for Medicare & Medicaid Services (CMS) and the Department of Defense (DOD) TRICARE Management Activity to implement both provisions of the new Medicare law in a manner that required little, if any, action on the part of the Medicare beneficiary.

  • Beneficiaries with Medicare Part A only were automatically enrolled in Medicare Part B effective September 2004. These beneficiaries also received a form in the mail, giving them the option of changing their Part B entitlement date to any other month in 2004, or refusing Part B altogether.
  • Beneficiaries who were paying a higher premium for their Medicare Part B received an automatic refund of all excess premiums paid in 2004. Most refunds were processed during September 2004.
  • Beneficiaries who were being billed for their Part B premiums did not receive a refund of excess premiums paid. The excess premiums were applied against their future premium bills.
  • Beneficiaries who enrolled in Medicare Part B between January and March of 2004 (the Medicare General Enrollment Period) were given the option to retain their July 2004 entitlement date or change the entitlement date to any other month within 2004.

After the automatic enrollment period, SSA, CMS, and DOD identified an additional 40,000 TRICARE beneficiaries who were eligible to enroll in Part B or were eligible for a premium refund. A policy was established that fully protects these TRICARE beneficiaries, allowing beneficiaries who were entitled to Part A only to enroll in Part B at the date of their choice (any month from January 2004 through June 2005) regardless of when they were contacted by SSA or when they independently came forward.

  • During the last week of March, 2005, SSA mailed notices to beneficiaries who were entitled to Part A only and were eligible for Part B enrollment, that provided an explanation of their Medicare Part B enrollment options and a form they could return in order to select a Part B enrollment date. By returning the form, TRICARE beneficiaries could take advantage of the special enrollment period in the same manner as those individuals Social Security automatically enrolled in Part B during September 2004.
  • Refunds for excess Part B premiums paid by all individuals who were identified by the second match (including beneficiaries who were being billed), were made in July 2005.
  • In addition, beneficiaries identified in September 2004, who had the premium refund applied to then-current and future premium bills received a refund of the balance of any current excess premiums.

If You Are Not Sure If This Affects You

Although SSA, CMS and the DOD attempted to identify all potentially eligible beneficiaries, some eligible individuals still may have been inadvertently omitted. SSA has developed processing instructions to address such situations.

Eligible individuals will be protected for the Part B enrollment or premium refunds just as if they had been initially identified. We will work with these individuals on a case-by-case basis to verify their TRICARE eligibility, and to enroll them in Medicare Part B or to refund excess premiums as appropriate.

Beneficiaries who think they may be affected by the new law who have not received a letter from SSA, should contact their local Social Security field office or call SSA at 1-800-772-1213.



Additional information regarding the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (P.L. 108-173) is available at

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Last reviewed or modified Monday Jan 14, 2008
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