LEGISLATIVE WATCH:

Cardin Introduces Bipartisan Bill to Eliminate Medicare Late Enrollment Penalty

The Floyd A. Spence National Defense Authorization Act of 2000 extended TRICARE eligibility to military retirees over 65 and provided them with a new pharmacy benefit. To participate in TRICARE-for-Life, retirees must be enrolled in Medicare Part B, a voluntary program that covers physician services, outpatient hospital care, and ancillary services. The Medicare Part B monthly premium for 2003 is $57.80.

Under current law, persons who do not enroll in Medicare Part B when they are first eligible to do so must pay a 10% penalty for every year they have not participated. But Cardin points out that retirees could not have anticipated the rules changes that have occurred in the military health system since 1996, when DOD replaced CHAMPUS with TRICARE; nor could they have known that participation in TRICARE after age 65 would eventually require Medicare enrollment. In some cases, the military advised retirees that Medicare coverage was duplicative and recommended that they not enroll.

The Department of Defense now estimates that 84,000 military retirees would be subject to the penalties.

Rep. Cardin’s TRICARE Retirees Opportunity Act would waive the late enrollment penalty for military retirees and their spouses who sign up for Medicare Part B between January 1, 2001 and December 31, 2004. The bill would also permit year-round enrollment through 2004 so that retirees can access the new benefits immediately. Currently, individuals who do not join Medicare Part B when initially eligible can only do so during the annual open enrollment season, which runs from January 1 until March 31.

The TRICARE Retirees Opportunity Act is being sponsored in the Senate by John Ensign of Nevada. It has been endorsed by the Military Coalition. Similar provisions of the bill were included in HR 4954, Medicare legislation that passed the House in June 2002.