ObamaCare Public Health Exchanges- Veterans Need Not Apply?


FEHB Aetna HDHP HSA Costs

It’s GubMints MailBag time!

[2014 Update #2 - TriCares's webpage indicates that Veterans can choose between ObamaCare or TriCare.  See my updated post regarding ObamaCare for more info]

[Note: This post has been updated 6/27/2013 based on reader feedback and further research.  Edits are strikethroughs and italics.]

GubMints reader C.E. writes:

Hi:
I was looking over the blog post you had about the California exchanges and the various veteran coverages.  I think it’s really helpful… <edit> one of the things we’ve had trouble finding information on is how Obamacare affects veterans.
If a person is eligible for public coverage like Medicaid or Medicare, or has an offer of insurance from an employer, that person is ineligible for a subsidy on the Obamacare exchanges.  The basic idea is that if you’re eligible for something else, we don’t want to give you a subsidy, get the something else.
What we can’t figure out is whether that rule applies to veterans, especially retired veterans with something approaching full coverage.  If veterans eligibility counts like Medicare eligibility, it has the following consequences:
(1) The veteran would not have access to exchange subsidies.  The veteran could pay full price, but would not be able to get a tax credit regardless of income level.  In your chart, the retired reservist making $50k would have to buy the Tricare policy or pay full price for the Obamacare policy.  That’s a big difference in cost.  It’s perverse, but the availability of veteran’s insurance hurts the veteran.
(2) The large employer mandate penalty is only triggered when a full-time employee is not offered insurance AND the employee gets a subsidy.  What this rule would allow would be for the employer to deny insurance offers to vets and the vet would then rely on the veteran coverage.  I’m thinking that can’t be right, but with Obamacare who knows?
If you’ve seen anything in your research, it’d be helpful if you pass along a link.  I might be missing something here, but I don’t think so.
Thanks, C.E.

C.E. -

Thanks for reading GubMints!

Seems like we’re all still finding out what’s in ObamaCare :(

I’ll answer your questions as best as I know- My specialty is benefits for Federal Employees (many of whom happen to be veterans) such as the Federal Employee Health Benefit (FEHB).  I have cc’d an expert in military benefits and retirement- Doug Nordman.  Doug runs “the-military-guide.com” website and its associated military benefits books.

1) VA coverage is initiated to any Honorably-discharged service member for a service-connected disability condition or active duty service during certain periods and locations.  A service-connected disability is typically identified by a particular event or environment the vet worked in.  Battle injury, disease from by exposure to a chemical, or degraded abilities from an identified occupational hazard are examples.  Note that VA provides coverage to vets only for the condition(s) specifically identified as disease or disability.

2) TriCare coverage is earned when a vet retires from a completed (20 year) career of service.  Note that the Retirement can be earned with any combination of Active and Reserve/Guard duty.

As an example, I have a Federal Employee working for me who is Retired Enlisted (20+ years of Active Duty).  He has VA coverage for a service-connected disability as well as his ‘conventional’ Tricare medical coverage he earned as an Active Duty Retirement benefit.  He has turned down the FEHB benefit available to himself and his family because Tricare is a better deal for him.

A rundown of VA and Tricare coverage is given at the following links:

http://www.va.gov/healthbenefits/apply/active_duty.asp

http://myarmybenefits.us.army.mil/Home/Benefit_Library/Federal_Benefits_Page/TRICARE_and_VA_Dual_Eligibility.html?serv=148

It’s not directly addressed if a vet can turn down Tricare and go on an ObamaCare Public Exchange.  I think the VA benefit (which is provided at no cost to the Vet) is earned for life once VA eligibility is determined. once a service-connected disability is identified.

Back to your question- Would a retired Vet be denied the SUBSIDIZED ObamaCare Public Exchange benefit if s/he is eligible for Tricare?   Answer is still,  “You are not only ineligible for Subsidized Obamacare, but you’re ineligible for ObamaCare altogether” “I dunno”.  (Note that only a “Gray Area” Retired Guard/Reservist in her right mind would turn down Tricare Retired Reserve- You’d have to be criminally insane to turn down Tricare Standard if you’re Active Duty Retired).  [See updated post RE: Veterans and ObamaCare eligibility]

If you look at the Federal  Government’s Obamacare application form, Step 4, Question 1, page 6- It appears that if you check a box that says “I am eligible for  FEHB or Tricare” then you are INELIGIBLE for Obamacare, much less subsidized Obamacare.

This would be is indeed a perverse twist - Any Joe Blow (including a convicted felon) can walk in off the street and be eligible for low-cost, Subsidized ObamaCare.  However, a Veteran who has honorably served for a 20-year career would is NOT be eligible for subsidized ObamaCare.
…but we’ve already seen stranger things in ObamaCare now that “We’ve passed the bill so we can find out What’s in It”.

GubMints Readers, feel free to comment, and let me know if you have any amplifying info on this.

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13 comments to ObamaCare Public Health Exchanges- Veterans Need Not Apply?

  • Great questions but whoo, guys, if I’m your military medical benefits expert then we’re all in trouble! I’m familiar with Tricare but I’m largely adrift once we get out into disability benefits.

    I agree that a military retiree would strongly prefer paying Tricare Prime (or even Standard) costs to those of an exchange or an employer’s health insurance. In fact, some defense contractors are counting on their military retiree employees to use Tricare to help trim the contractor’s benefits budget. Tricare is usually a cheaper deal for the employee, too, and that’s caused a lot of resentment at the Department of Defense, for example: http://www.military.com/features/0,15240,238056,00.html This is running into new challenges, though, as Tricare reimbursement rates are causing some doctors to begin turning away patients. I’m not sure that a subsidized health exchange would make a doctor happier, but that would depend on reimbursement rates.

    Veterans who are eligible for disability benefits have access to VA healthcare. (And yes, that’s for life.) Some of it’s very good and some of it’s very bad, but it’s almost certainly cheaper than even the exchange subsidy– especially for continuing prescription medications. Another effect of veteran’s disability ratings is that the veteran may also become eligible for Medicare, which would appear to render them ineligible for the exchanges even while they’re paying Medicare premiums.

    So I agree with your logic that treats veteran’s healthcare eligibility largely like Medicare eligibility. Veterans would not have access to exchange subsidies and employers would nudge them toward their veteran’s benefits. I also agree that it has the worst financial impact on Reserve/National Guard retirees who have higher incomes. Healthcare before age 60 has always been a weak part of the Reserve/Guard system, and this just highlights the issue.

    I guess the theory behind the exchange logic is that veterans already have safety nets for their medical benefits in proportion to their degree of disability. We already know that doesn’t work as well as it should. I’m skeptical that the health exchange subsidies would be an improvement over the DoD and VA systems. The biggest problem with the veteran’s disability system is that the ones who need it the most are usually the ones least capable of navigating the bureaucracy.

    The real healthcare cost challenge will be the tug-of-war that results during the next decade as DoD tries to raise Tricare premiums or even throttle Tricare Prime out of existence. The unanticipated consequence would be to transfer the expense from DoD to the exchanges. SECDEF might be a fan of that approach, but not the White House. Congress would object to both. The last battle on Tricare fees ran for 15 years before DoD and Congress reached a compromise.

    As for the convicted felon getting subsidized care before the veteran, I’d like to think that the convict’s subsidized healthcare would cost us taxpayers less than the current system of paying for the convict’s healthcare through higher hospital fees and insurance premiums. We already have that “win” for veterans through DoD and the VA, but not for the other 91% of Americans who’ve never served.

  • Delta 2-1

    I’m scouring the web for info on the Disabled Veterans part of this mess. Say a vet is 10% disabled, enrolled in VA system for the particular disability he/she has, but works for a living and has a decent healthcare plan from his/her employer. If the irs says to me next year, your employer plan is not good enough, you pay the fine, Beeotch!. Can I just tell the irs screwheads, I’m enrolled in the VA, and convert to that to avoid the fine? Maybe Nancy will visit me personally and let me know whats in the bill. LOL

    • Delta 2-1 -

      Thanks for your service!

      I am assuming the situation of concern is that of a 10% Disabled Vet.

      In this case, the Vet has VA coverage initiated by ONLY for those conditions related to his/her disability rating.
      If no other medical coverage is provided to the Veteran (via employer’s plan, Tricare, FEHB or VA) then the Vet is on his/her own to get coverage, and would be eligible for an Obamacare exchange plan.

      Have a look at Step 4, Question 1, page 6 on the ObamaCare application form for eligibility:

  • Carl

    Not sure where this”only for the service connected disability coverage” is coming from, but any Veteran rated 10% SC or more is eligible for almost everything the VA offers. Dental, Nursing Home, Hearibg aids being some exceptions.
    Granted, the VA will provide free care and meds for anything service connected but will also provide a ful range of care subject to copays only depending on a financial means test. Those copays are currently 15 dollars for a primary care visit, 50 for a specialty visit and inpatient copays vary depending on the level of care.
    As I served in Vietnam and was exposed to Agent Orange I am eligible for and use the VA even though I have no SC disabilities. I just have to pay the copays due to my income.
    Check the http://www.va.gov website for more detailed information.

    • Carl -

      Thanks for your service, and thanks for reading GubMints.

      I’ve edited the post and comments to update other conditions that can provide eligibility for VA Health Care. Apologies that the post and comments caused some confusion and veered off in to a discussion about VA health care.

      The original intent of the post was to alert my audience (current and retired Federal Employees, of whom over 40% are Veterans) that they will be INELIGIBLE for ObamaCare if they are eligible for FEHB (either as an employee or FERS/CSRS retiree) or Tricare (if retired from 20 years of Active or Guard/Reserve service).

      In cases where a Fed or Vet retiree is on a fixed income of less than $70K/year, this is a raw deal.

  • Hamer

    I don’t see the need for concern.

    If you are a retired vet (20+ yr) you are eligible for tricare 100% subsidized HC.

    If you are a retired fed your already have HC subsidized to 72%, if your a low income retiree, you can drop FEHB before retirement or after retirement and no longer be eligible. http://www.opm.gov/healthcare-insurance/fastfacts/thinkfehb.pdf If anything, Obamacare may be a new benefit to low income fed retirees.

    • Hamer -

      Good point, but I would recommend to a Federal Annuitant (FERS or CSRS) that they SUSPEND and not “Drop” (I assume you mean cancel) FEHB coverage if they think ObamaCare is a better deal. Once you cancel FEHB you can never go back.

      Details on how an annuitant may Suspend FEHB are listed here.

      Again, it’s not crystal clear on the ObamaCare application form- If you check the box that says “I am ELIGIBLE” for FEHB, I would not bet my annuity check that I would be eligible for ObamaCare.

  • [...] you’re eligible for any level of VA care, whether it’s high-priority or low-priority, you’re no longer eligible for ACA exchange subsidies. You can still buy insurance from the exchange (like a supplemental policy) but you’d pay the [...]

  • I am 62 years old.. Served in Vietnam 1970 thru 1971 in the Navy. I have 10% hearing disability…surgery on right hand removed bone chips in thumb area..I get Halgren shots in both my knees 6 weeks a year with travel pay from Mankato Mn.to Minneapolis VA..Mankato is my primary care VA…My question is do I need to purchase Obama care insurance ?

    • Michael -

      Thanks for your service.

      From your note, you qualify for 2 of the ‘Enhanced Eligibility’ conditions for VA Benefits- (1) Vietnam Vet, and (2) 10% disabled.

      It sounds like VA is covering all of your medical care. If this is not the case, you may want to consider applying for a supplemental policy until Medicare kicks in at age 65.

  • NG Retiree

    I am a recently retired gray area retiree, age 51. I am eligible for Tricare Retired Reserve (TRR) coverage at ~$960/month. I am rated by the VA at 40% and have a wife who needs medical insurance coverage. Our income would put us in the ACA premium subsidy eligibility range, and we have no employer provided health insurance. I have 3 questions:

    1. I am unclear of the coverage I have through VA for non-service related issues and if this precludes me from ACA premium subsidies.

    2. TRR premium would be a big bite. Would I/my wife/we qualify for ACA premium subsidy for TRR premiums? (Could you explain your statement, “Note that only a “Gray Area” Retired Guard/Reservist in her right mind would turn down Tricare Retired Reserve”?)

    3. I don’t believe that I can purchase TRR for my wife only, correct? My wife eligible for ACA premium subsidies?

    • NG Retiree –

      Thanks for your service!

      There’s some horrible dis-information about ObamaCare on the internet(s). I’ve even seen reputable publications like GovExec state that full-time Feds can waive FEHB and go on ObamaCare- Not True! I’ll be updating this post over the weekend to clear up some of the misconceptions out there. Bottom Line: Don’t believe anything written about ObamaCare or TriCare unless it comes from a .mil or .gov source.

      You are the man I wrote this post about- There’s a convicted felon on welfare out there who can buy a subsidized Obamacare policy for under $400/month, but you’re legally obligated to TriCare for $960/month because you’re eligible for TriCare (because TriCare meets the ‘Minimum Standards of Coverage’ as defined by ObamaCare/ACA).

      #1 – VA Coverage- Where Earned and specified – is your primary medical coverage for your Service-Connected Disability, and possibly more. Contact the VA for more info.

      #2 – TRR is secondary to whatever is not covered for you by the VA.
      Your wife may be eligible for ObamaCare if you waive covering her on TriCare. You’d have to elect ‘self only’ coverage on TRR and then leave your wife to ‘fend for herself’ using either her employer’s coverage or the ObamaCare exchange. Contact your CPA or Legal Counsel prior to making this TriCare election.

      #3- I don’t think you can ignore yourself and elect TRR only for dependents. Contact TriCare for more info.

      • NG Retiree

        A couple of follow ups:

        –I am eligible for TRR, but I have not yet enrolled in TRR. Would this change any of your responses above?

        –It seems that the premium subsidies are only available to insurance purchased on the exchanges. I can’t find anywhere that TriCare sells policies on any exchange. Have you seen anything to suggest that gray-area retirees can get a premium subsidy to purchase TRR?

        Thanks for the information.

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