TRICARE
Enrollment of the Department of Defense's TRICARE Beneficiaries in Medicare Part B Gao ID: GAO-06-489R June 30, 2006TRICARE is the Department of Defense's (DOD) health care system for active duty and retired uniformed service members and their families. TRICARE consists of four separate programs. Three of these programs--TRICARE Prime, a managed care option; TRICARE Extra, a preferred provider option; and TRICARE Standard, a fee for service option--cover active duty personnel, their dependents, and retirees under age 65. Prior to 2001, TRICARE beneficiaries would lose their TRICARE coverage when they reached age 65, and Medicare--the federal health insurance program that provides medical benefits to over 42 million elderly and disabled Americans--would become their primary health insurer. However, in 2001, the Congress expanded TRICARE by establishing a fourth program, known as TRICARE for Life (TFL). TFL provides supplementary health care coverage for TRICARE beneficiaries who are entitled to Medicare Part A, and enrolled in Part B. It pays for many services that Medicare only partially covers. While TRICARE beneficiaries do not have to pay for their TFL coverage, they are required to pay premiums for Medicare Part B. Section 625 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) provided enrollment incentives to TRICARE beneficiaries who were entitled to Medicare Part A, but were not enrolled in Medicare Part B during their initial eligibility period. Four federal organizations had a role in implementing Section 625 of MMA. DOD's TRICARE Management Activity (TMA), which oversees the TFL program, and DOD's Defense Manpower Data Center (DMDC), which maintains the military's personnel database in its Defense Enrollment Eligibility Reporting System (DEERS), both had key roles in implementing the new law. In addition, the Centers for Medicare & Medicaid Services (CMS)--the Department of Health and Human Services agency that oversees the Medicare program--and SSA, which enrolls Medicare beneficiaries and assists with the collection of Medicare premiums on CMS's behalf, had significant responsibilities. Interested in determining the extent to which TRICARE beneficiaries benefited from the provisions of Section 625 of MMA, Congress asked GAO to report on the implementation of this law. This report describes (1) the steps that TMA, DMDC, CMS, and SSA took in response to Section 625 of MMA, including their efforts to correct problems encountered during the law's implementation, and (2) the extent to which TRICARE beneficiaries were served.
All four organizations--TMA, DMDC, CMS, and SSA--collaborated to implement Section 625 of MMA. The organizations took a series of steps, including reaching agreement to share necessary data. To identify the targeted TRICARE beneficiaries, the organizations worked together, from May through July of 2004, to perform a data match--a process during which they compared and matched Social Security numbers and dates of birth of TRICARE beneficiaries in their respective databases. DMDC mailed information to TRICARE beneficiaries in September 2004, alerting them that they would receive important information from SSA concerning their Medicare Part B enrollment. Also in September 2004, after the data match was finalized, SSA sent notices to about 49,000 TRICARE beneficiaries advising them that they had been automatically enrolled in Part B or that they were eligible for a repayment of their premium surcharges. However, the data used for this match were incomplete. As a result, TRICARE beneficiaries who should have been identified were inadvertently excluded. Some of those who did not receive a notice from SSA alerted federal officials to the error, within days of the SSA mailing. Over the next several months, DOD and CMS worked unsuccessfully to resolve the error. They decided, in December 2004, that it would be more expeditious to conduct a second data match than to pinpoint and correct the problems associated with the first data match. The organizations completed the second data match by mid-February 2005. CMS extended the Part B special enrollment period mandated by Section 625 of MMA from December 2004 through June 2005. Beneficiaries identified by the second data match had the option of enrolling in any month of 2004 or in one of the first 6 months of 2005. In addition, SSA developed processes to enroll individuals who presented themselves, but had not received letters. Information on the total number of TRICARE beneficiaries served under Section 625 of MMA is not known. Available SSA and CMS data show that over 44,000 TRICARE beneficiaries were either enrolled in Medicare Part B or repaid for their 2004 premium surcharges, under the provisions of Section 625 of MMA. About 26,000 TRICARE beneficiaries enrolled during the special enrollment period, and about 18,700 additional TRICARE beneficiaries were either credited or repaid for premium surcharges. Although SSA determined that it had received nearly 15,000 TFL-related inquiries since January 2004, it did not separately track how many of these inquiries resulted in enrollments in Part B, premium adjustments, or repayments. Further, SSA did not separately track how many TFL-related appeals it received or the disposition of such appeals, so such information is unavailable.
GAO-06-489R, TRICARE: Enrollment of the Department of Defense's TRICARE Beneficiaries in Medicare Part B
This is the accessible text file for GAO report number GAO-06-489R
entitled 'TRICARE: Enrollment of the Department of Defense's TRICARE
Beneficiaries in Medicare Part B' which was released on July 31, 2006.
This text file was formatted by the U.S. Government Accountability
Office (GAO) to be accessible to users with visual impairments, as part
of a longer term project to improve GAO products' accessibility. Every
attempt has been made to maintain the structural and data integrity of
the original printed product. Accessibility features, such as text
descriptions of tables, consecutively numbered footnotes placed at the
end of the file, and the text of agency comment letters, are provided
but may not exactly duplicate the presentation or format of the printed
version. The portable document format (PDF) file is an exact electronic
replica of the printed version. We welcome your feedback. Please E-mail
your comments regarding the contents or accessibility features of this
document to Webmaster@gao.gov.
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed
in its entirety without further permission from GAO. Because this work
may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this
material separately.
June 30, 2006:
The Honorable Pete Stark:
Ranking Minority Member:
Subcommittee on Health:
Committee on Ways and Means:
House of Representatives:
The Honorable Benjamin L. Cardin:
House of Representatives:
Subject: TRICARE: Enrollment of the Department of Defense's TRICARE
Beneficiaries in Medicare Part B:
TRICARE is the Department of Defense's (DOD) health care system for
active duty and retired uniformed service members and their families.
TRICARE consists of four separate programs. Three of these programs--
TRICARE Prime, a managed care option; TRICARE Extra, a preferred
provider option; and TRICARE Standard, a fee for service option--cover
active duty personnel, their dependents, and retirees under age 65.
Prior to 2001, TRICARE beneficiaries would lose their TRICARE coverage
when they reached age 65, and Medicare--the federal health insurance
program that provides medical benefits to over 42 million elderly and
disabled Americans--would become their primary health insurer. However,
in 2001, the Congress expanded TRICARE by establishing a fourth
program, known as TRICARE for Life (TFL). TFL provides supplementary
health care coverage for TRICARE beneficiaries[Footnote 1] who are
entitled to Medicare Part A,[Footnote 2] and enrolled in Part B. It
pays for many services that Medicare only partially covers. While
TRICARE beneficiaries do not have to pay for their TFL coverage, they
are required to pay premiums for Medicare Part B.
DOD generally encourages TRICARE beneficiaries to enroll in Medicare
Part B when they reach age 65 or when the Social Security
Administration (SSA) determines that they are disabled and they have
been receiving disability benefits for 24 months. Those who do not
enroll in Part B when first eligible must wait, like other
beneficiaries, for Medicare's general enrollment period, which is held
annually, from January 1 to March 31, with coverage beginning on July 1
of that same year. In addition, those who enroll during the general
enrollment period are assessed a surcharge for each 12-month period
that enrollment was delayed after their initial eligibility. Not all
TRICARE beneficiaries enrolled in Medicare Part B when they first
became eligible to do so and, as a result, were assessed premium
surcharges when they eventually signed up for it.
Section 625 of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (MMA) provided enrollment incentives to
TRICARE beneficiaries who were entitled to Medicare Part A, but were
not enrolled in Medicare Part B during their initial eligibility
period.[Footnote 3] In particular, Section 625 waived premium
surcharges for TRICARE beneficiaries who enrolled in Medicare Part B
from 2001 through 2004. The law also required that the Secretary of
Health and Human Services establish a method for providing rebates for
Part B premium surcharges that this group had paid since 2004. Further,
the law directed the Secretary to provide a Part B special enrollment
period for TRICARE beneficiaries who had not enrolled in Part B as of
the date of MMA's enactment--December 8, 2003. The law mandated that
this special enrollment period begin as soon as possible after MMA's
enactment and end on December 31, 2004.
Four federal organizations had a role in implementing Section 625 of
MMA. DOD's TRICARE Management Activity (TMA), which oversees the TFL
program, and DOD's Defense Manpower Data Center (DMDC), which maintains
the military's personnel database in its Defense Enrollment Eligibility
Reporting System (DEERS), both had key roles in implementing the new
law.[Footnote 4] In addition, the Centers for Medicare & Medicaid
Services (CMS)--the Department of Health and Human Services agency that
oversees the Medicare program--and SSA, which enrolls Medicare
beneficiaries and assists with the collection of Medicare premiums on
CMS's behalf, had significant responsibilities. TMA, DMDC, and CMS had
to identify which TRICARE beneficiaries were targeted for the Section
625 enrollment incentives. SSA had to enroll the TRICARE beneficiaries
in Medicare Part B, waive the late enrollment premium surcharges, and
repay the surcharges paid for their premiums since 2004.
Although the four organizations worked together to implement the new
law, there were problems with the data that were used to initially
identify which TRICARE beneficiaries were targeted by Section 625. As a
result, some of the TRICARE beneficiaries who should have been
identified were inadvertently excluded. Interested in determining the
extent to which TRICARE beneficiaries benefited from the provisions of
Section 625 of MMA, you asked us to report on the implementation of
this law. This report describes (1) the steps that TMA, DMDC, CMS, and
SSA took in response to Section 625 of MMA, including their efforts to
correct problems encountered during the law's implementation, and (2)
the extent to which TRICARE beneficiaries were served.
To describe the steps that TMA, DMDC, CMS, and SSA took in response to
Section 625 of MMA, including their efforts to correct problems
encountered, we reviewed the TMA, DMDC, and CMS agreements to share
enrollment and eligibility data. We also interviewed CMS and SSA
officials, as well as DOD representatives from TMA and DMDC. We focused
our work on those organizations' efforts to identify, enroll, waive,
and repay premium surcharges to eligible TRICARE beneficiaries.
To describe the extent to which TRICARE beneficiaries were served, we
obtained data from the involved agencies on the number of TRICARE
beneficiaries who were enrolled in Part B or whose premium surcharges
were repaid. We assessed the reliability of the DOD, CMS, and SSA data
by corroborating them with available documentation from TMA, DMDC, CMS,
and SSA. While we previously reported on weaknesses in DEERS, we
determined that those weaknesses were not germane for the purposes of
this report.[Footnote 5] We reviewed the Part B enrollment and premium
surcharge data for consistency and discussed the discrepancies with CMS
and SSA officials and determined that these data were reliable for
purposes of this report. In addition, we examined the notices and other
correspondence that the organizations sent to TRICARE beneficiaries to
determine when and how they were given the opportunity to enroll in
Medicare Part B. We also determined whether the notices included
information on their right to appeal the amount of the premium
surcharges that were repaid, if they disagreed with SSA's calculation.
Our scope was limited to the actions taken by TMA, DMDC, CMS, and SSA
to implement Section 625 of MMA.[Footnote 6] We performed our work from
July 2005 through May 2006 in accordance with generally accepted
government auditing standards.
Results In Brief:
All four organizations--TMA, DMDC, CMS, and SSA--collaborated to
implement Section 625 of MMA. The organizations took a series of steps,
including reaching agreement to share necessary data. To identify the
targeted TRICARE beneficiaries, the organizations worked together, from
May through July of 2004, to perform a data match--a process during
which they compared and matched Social Security numbers and dates of
birth of TRICARE beneficiaries in their respective databases. DMDC
mailed information to TRICARE beneficiaries in September 2004, alerting
them that they would receive important information from SSA concerning
their Medicare Part B enrollment. Also in September 2004, after the
data match was finalized, SSA sent notices to about 49,000 TRICARE
beneficiaries advising them that they had been automatically enrolled
in Part B or that they were eligible for a repayment of their premium
surcharges. However, the data used for this match were incomplete. As a
result, TRICARE beneficiaries who should have been identified were
inadvertently excluded. Some of those who did not receive a notice from
SSA alerted federal officials to the error, within days of the SSA
mailing. Over the next several months, DOD and CMS worked
unsuccessfully to resolve the error. They decided, in December 2004,
that it would be more expeditious to conduct a second data match than
to pinpoint and correct the problems associated with the first data
match. The organizations completed the second data match by mid-
February 2005. CMS extended the Part B special enrollment period
mandated by Section 625 of MMA from December 2004 through June 2005.
Beneficiaries identified by the second data match had the option of
enrolling in any month of 2004 or in one of the first 6 months of 2005.
In addition, SSA developed processes to enroll individuals who
presented themselves, but had not received letters.
Information on the total number of TRICARE beneficiaries served under
Section 625 of MMA is not known. Available SSA and CMS data show that
over 44,000 TRICARE beneficiaries were either enrolled in Medicare Part
B or repaid for their 2004 premium surcharges, under the provisions of
Section 625 of MMA. About 26,000 TRICARE beneficiaries enrolled during
the special enrollment period, and about 18,700 additional TRICARE
beneficiaries were either credited or repaid for premium surcharges.
Although SSA determined that it had received nearly 15,000 TFL-related
inquiries since January 2004, it did not separately track how many of
these inquiries resulted in enrollments in Part B, premium adjustments,
or repayments. Further, SSA did not separately track how many TFL-
related appeals it received or the disposition of such appeals, so such
information is unavailable.
We provided a draft of this report to CMS, DOD, and SSA. We received
written comments from CMS and DOD. SSA also provided us with comments
by e-mail. All three agencies generally concurred with our findings.
Background:
The Floyd D. Spence National Defense Authorization Act for Fiscal Year
2001 authorized the creation of the DOD Medicare-Eligible Retiree
Health Care Fund, which covers the full cost of TFL coverage for
military retirees, certain dependents, and survivors who are entitled
to Medicare Part A, and enrolled in Part B.[Footnote 7] TFL alleviates
the need to purchase supplemental health insurance because it covers
Medicare's co-payment and deductible medical expenses. TFL also
alleviates the need for TRICARE beneficiaries to enroll in Medicare
Part D because, under TFL, they can obtain prescription drugs at no
cost from military treatment facilities, at low cost through DOD's
National Mail Order Pharmacy, or, at higher costs from retail network
or non-network pharmacies. In addition, TFL pays for certain skilled
nursing and inpatient hospitalization services that Medicare does not
cover.
Individuals who are entitled to Social Security retirement or
disability benefits are automatically enrolled in Medicare Parts A and
B. CMS sends these individuals an initial enrollment period package
that includes information about the Medicare program, a Medicare card,
and a form that can be used to decline Part B enrollment. The package
does not include a similar form to decline Part A coverage because
beneficiaries cannot decline Part A. All other individuals who file an
application for either Social Security benefits or Medicare are
automatically enrolled in Medicare Part A. If these individuals choose
to elect Part B coverage, they must do so at the time the application
is filed. Most people do not pay a premium for Part A;[Footnote 8]
however, all beneficiaries who elect Part B coverage must pay the Part
B premium. People who do not receive Social Security benefits are
billed for 3 months of Part B coverage at a time, with the first
payment due 1 month before their 65th birthday. If individuals who
accept Part B enrollment also receive Social Security benefits, SSA
will deduct the Part B monthly premium from their Social Security
benefit payments, beginning with the month before they are entitled to
Part B. However, those who do not enroll in Part B when first eligible
must wait for Medicare's annual general enrollment period, from January
1 to March 31, to sign up for coverage.
The surcharges that people pay for delayed Part B enrollment can be
substantial because they are assessed 10 percent of the cost of the
premium, for each full 12-month period that they delay enrolling.
Moreover, these surcharges are added to the cost of the premium for the
life of the coverage.[Footnote 9] For example, figure 1 shows four
hypothetical Medicare beneficiaries who enrolled in Part B at different
ages and the impact of their enrollment dates on the premium surcharges
they incurred. As shown, by the end of 2004, the Medicare beneficiary
who delayed enrollment until age 68 would have paid nearly $500 in
premium surcharges, or twice the amount of the Medicare beneficiary who
enrolled at age 67, while those enrolling at ages 66 or 65 would pay no
surcharge at all.
Figure 1: Example of Medicare Part B Premium Surcharges Paid for Late
Enrollment by the End of 2004:
[See PDF for Image]
Note: According to CMS policy, premiums that are not multiples of 10
cents are rounded to the nearest dime.
[End of Figure]
Organizations Collaborated To Implement Law And To Correct Initial
Enrollment Errors:
All four organizations--TMA, DMDC, CMS, and SSA--worked together to
implement Section 625 of MMA. DOD and CMS signed a memorandum of
understanding (MOU) in May 2004, which established the role of each
organization and also recognized that the successful implementation of
the law depended on their sharing accurate and complete sets of data.
The organizations agreed to perform an analysis, known as a data match,
to identify the TRICARE beneficiaries who were eligible under Section
625 to enroll in Part B during the special enrollment period or
entitled to have their premium surcharges waived and the 2004
surcharges repaid. Despite their efforts, the data that were used in
this data match were incomplete and some TRICARE beneficiaries were
inadvertently excluded. The agencies conducted a second data match to
develop a comprehensive list of TRICARE beneficiaries and also extended
the special enrollment period.
Initial Steps to Implement Section 625:
By March 2004, officials from all four organizations decided that
rather than waiting for TRICARE beneficiaries to individually apply for
Part B enrollment, it would be more efficient for SSA to automatically
enroll them in Part B. To do this, the organizations opted to conduct a
data match, which would require them to obtain and extract information
from their respective databases to identify who was (1) eligible to
enroll during the Section 625 special enrollment period, (2) entitled
to have Part B premium surcharges waived, and (3) due a repayment for
2004 premium surcharges. TMA, CMS, and SSA officials told us that they
posted information on their organizations' Web sites prior to this data
match. This information was intended to alert TRICARE beneficiaries
that they would be contacted by SSA as soon as implementation
procedures were finalized. SSA officials also trained their field
office staff on how to handle inquiries, should they be contacted
before the procedures were finalized.
Each organization had different sets of information and had to take
particular steps to identify the TRICARE beneficiaries. TMA had
information on TRICARE beneficiaries receiving TFL coverage. DMDC,
which maintains the DEERS database, had information on all active duty
members of the uniformed services, military retirees, and the
dependents and survivors of active duty servicemembers and military
retirees. CMS, in its enrollment database, had enrollment and
entitlement information on all of the people who were or have been
enrolled in Medicare. CMS's data also included information on the
person's age, gender, state and county of residence, and date of
enrollment. SSA's Master Beneficiary Record, which is its principal
beneficiary file, had information on SSA's current and previous
retirement and disability beneficiaries and applicants. The Master
Beneficiary Record also contained information on Medicare enrollment,
premiums, and premium surcharges. TMA and DMDC provided the DOD
information on TRICARE beneficiaries to CMS. CMS extracted data on
those meeting the selection criteria and shared its results with SSA.
SSA, in turn, eliminated duplicate entries and the names of deceased
TRICARE beneficiaries, which finalized the results of the data match.
Figure 2 illustrates the Section 625 data match and the information
that TMA, DMDC, CMS, and SSA used to identify TRICARE beneficiaries.
Figure 2: Initial Steps Federal Organizations Took to Identify Those
Eligible for Medicare Part B:
[See PDF for Image]
Source: GAO.
[End of Figure]
Organizations Completed Data Match and Discovered Errors:
TMA, DMDC, and CMS had difficulty identifying the TRICARE beneficiaries
targeted by Section 625 of MMA. The MOU they signed specified the
information that they would share. TMA and DMDC agreed to provide CMS
with the Social Security numbers and dates of birth of TRICARE
beneficiaries from the DEERS database. CMS agreed to match that
information with data in its enrollment database and identify which
TRICARE beneficiaries were entitled to premium-free Part A and were not
enrolled in Medicare Part B. CMS also agreed to identify TRICARE
beneficiaries who were eligible to have their Part B premiums
surcharges waived and their 2004 premium surcharges repaid. CMS would
then share the results of the data match with SSA, which would take
steps to enroll the TRICARE beneficiaries in Part B and arrange for the
2004 premium surcharges to be repaid.
However, DMDC and CMS officials did not agree on how many TRICARE
beneficiaries were included in the files used for this initial data
match. DMDC officials told us that they sent two files to CMS, from May
10 through 13, 2004, containing data on a combined total of 7.2 million
TRICARE beneficiaries. However, CMS officials told us they received one
file containing information on about 6.9 million TRICARE beneficiaries-
-a difference of about 300,000 TRICARE beneficiaries.
From mid-May to mid-June, CMS matched the data it received from DMDC
with data in its enrollment database to identify the TRICARE
beneficiaries targeted for Section 625 enrollment incentives. CMS
identified three distinct groups of TRICARE beneficiaries who were
entitled to premium-free Part A: (1) those who were not enrolled in
Part B, (2) those who had enrolled in Part B and were paying premium
surcharges and were potentially eligible for premium surcharge waivers
and for surcharge repayments, and (3) those who enrolled during
Medicare's 2004 general enrollment period and to whom CMS offered the
choice of making their coverage retroactive to an earlier month during
2004, in addition to waiving any premium surcharge.[Footnote 10] CMS
electronically transmitted these three files to SSA in mid-June 2004.
According to SSA officials, in July 2004, they eliminated duplicate
entries and the names of deceased TRICARE beneficiaries from the
information provided by CMS. From September 4, 2004, through September
10, 2004, SSA sent notices to the over 49,000 remaining TRICARE
beneficiaries concerning their eligibility under Section 625 of MMA.
SSA notified the first group of TRICARE beneficiaries--those that had
not enrolled in Part B--that the agency had automatically enrolled them
in Part B, with a September 1, 2004, effective date. SSA also informed
them that it had deducted 2 months worth of premiums from their Social
Security benefit checks and that those who did not receive benefit
checks would be billed separately by CMS. The notice also explained
that because MMA mandated that a special enrollment period be offered
to them, they could choose to make their Part B coverage effective in
any month in 2004. SSA's notice to this first group of TRICARE
beneficiaries also explained how to decline Part B enrollment.
SSA informed the second group of TRICARE beneficiaries--who were paying
premium surcharges--that their premium surcharges would be waived and
that the surcharges they paid for Part B in 2004 would either be
included in their Social Security benefit checks or credited toward
future premiums, if they were billed for Part B coverage. SSA notified
the TRICARE beneficiaries in the third group--who had enrolled during
Medicare's 2004 general enrollment period--that they could make their
coverage retroactive to as early as January 2004, instead of the
customary July 1effective date. TRICARE beneficiaries in this third
group were also informed that their premium surcharges would be waived
and that any surcharges they might have paid would be repaid or
credited toward future premiums. Additionally, SSA's notices advised
them how to appeal, if they disagreed with the agency's Part B
enrollment determination or the repayment calculation.
In September 2004, DMDC alerted TRICARE beneficiaries by mail that they
would receive important information from SSA concerning their Medicare
Part B enrollment. DMDC also categorized TRICARE beneficiaries into
three groups; these groups were different from the three categories
used by CMS and SSA.[Footnote 11] Beginning in September 2004, within
days of the SSA mailing, TMA, CMS, and SSA received inquiries from
concerned TRICARE beneficiaries who had received letters from DMDC but
had not received enrollment information from SSA. According to
officials from TMA, CMS, and SSA, these calls were their first
indication that some of the targeted TRICARE beneficiaries had not been
identified through their data match efforts. TMA's and DMDC's internal
quality review estimated that DMDC had mailed notices to about 42,000
more TRICARE beneficiaries than SSA had notified. According to CMS, it
determined that, in early December 2004, most of the beneficiaries who
said they had not received a letter from SSA were not included on the
initial file received from DMDC. As a result, CMS had not transmitted
data on these beneficiaries to SSA in June 2004.
Organizations Obtained Corrected Data and Extended the Enrollment
Period:
On December 29, 2004, TMA, DMDC, CMS, and SSA officials agreed that it
would be more expeditious to perform a second data match than to
continue investigating why some TRICARE beneficiaries had not been
identified by their initial efforts. The next day, December 30, 2004,
CMS received the Social Security numbers and dates of birth of
approximately 7.4 million TRICARE beneficiaries from DMDC, which
included data on over 500,000 more TRICARE beneficiaries than used for
the initial data match. This time, DMDC transmitted data on all the
TRICARE beneficiaries potentially eligible for TFL benefits in its
database in a single file, not in two separate files as organization
officials said had been done for the initial data match. Matching these
data with its enrollment database, from January 10 through January 12,
2005, CMS identified two groups of TRICARE beneficiaries who were
entitled to premium-free Part A: (1) those who were not enrolled in
Part B and (2) those who were enrolled in Part B and potentially
eligible for their premium surcharges to be waived and for the 2004
surcharges to be repaid.[Footnote 12] CMS transmitted information on
these TRICARE beneficiaries to SSA on January 12, 2005.
By mid-February, SSA reviewed the data it received from CMS--
eliminating duplicate entries and the names of deceased persons. In
March 2005, SSA sent the identified 41,345 TRICARE beneficiaries
instructions on how to enroll in Part B and an enrollment form, and
offered those who chose to enroll the option of selecting any month in
calendar year 2004 or the first 7 months of 2005 for their Part B
coverage to begin.[Footnote 13] However, CMS, SSA, and TMA officials
agreed that it would be preferable to offer information on Part B
enrollment, rather than automatically enrolling TRICARE beneficiaries
as had been done following the first data match. These officials
expressed several concerns with automatic enrollment. First, CMS and
SSA officials told us that an automatic enrollment would not save time.
Instead, they told us that they were concerned that it would take as
long to automatically enroll those identified by the second data match
as it had taken them to enroll TRICARE beneficiaries after the initial
data match. Second, SSA pointed out that some of the individuals
identified by the second data match were already in the process of
being enrolled. Third, TMA officials told us they were also concerned
that some TRICARE beneficiaries might have declined coverage and would
be irritated if SSA enrolled them a second time and deducted 2 months'
premiums from their Social Security benefit checks.
In addition, on April 27, 2005, SSA provided written instructions to
its field offices on how to enroll and process repayments for TRICARE
beneficiaries who might not have received either its September 2004 or
March 2005 notice, but who may subsequently have learned about their
eligibility under Section 625 of MMA. These instructions also extended
the special enrollment period through June 2005 because, according to
CMS and SSA officials, not all of the eligible TRICARE beneficiaries
had an ample opportunity to enroll during the special enrollment period
specified in the law. The instructions also included provisions for
enrolling eligible TRICARE beneficiaries after June 2005, on a case-by-
case basis. The instructions also reminded SSA field staff that there
is no time limit for waiving or repaying the Part B premium surcharges.
Figure 3 illustrates the agencies' efforts to implement Section 625 of
MMA, including their efforts to correct the problems encountered after
the initial data match.
Figure 3: Timeline of Federal Actions to Implement Section 625 of MMA:
[See PDF for Image]
Source: GAO analysis of DOD, CMS, and SSA information.
Note: CMS extended the Section 625 special enrollment period through
June 2005. In addition, SSA's April 27, 2005, instruction to its field
offices included provisions for enrolling TRICARE beneficiaries and
repaying premium surcharges after June 2005, on a case-by-case basis.
[End of Figure]
Data On Tricare Beneficiaries Served Under Section 625 Of Mma Are
Incomplete:
Although the total number of TRICARE beneficiaries served by the
implementation of Section 625 is not fully known, we found that over
44,000 TRICARE beneficiaries benefited from this law, most as a result
of the first data match. Data from SSA's automated processing system
showed that it enrolled or provided Part B premium surcharge repayments
to 43,948 TRICARE beneficiaries, as a result of Section 625 of MMA. SSA
also told us other TRICARE beneficiaries were served by Section 625 of
MMA, but were not tracked by its automated systems. In addition, CMS
officials reported that implementation of Section 625 of MMA resulted
in premium surcharge repayments or credits toward future premiums for
462 TRICARE beneficiaries, who were billed for Part B coverage.
Over 44,000 TRICARE Beneficiaries Enrolled in Part B or Were Repaid for
Premium Surcharges:
By December 2005, SSA's automated processing system showed that 43,948
TRICARE beneficiaries benefited from Section 625. SSA enrolled 25,697
TRICARE beneficiaries in Part B and repaid premium surcharges to an
additional 18,251 TRICARE beneficiaries. However, according to SSA
officials, this does not include data on an unspecified number of
TRICARE beneficiaries associated with about 2,000 Social Security
numbers, who were not enrolled, repaid, nor had their premium
surcharges waived by the agency's automated processing system.[Footnote
14] Most of the TRICARE beneficiaries who enrolled or received
repayments for their premium surcharges were as a result of the first
data match.
In June 2004, CMS identified a total of 59,918 TRICARE beneficiaries
who were entitled to premium-free Part A and potentially eligible for
the Section 625 enrollment incentives, as a result of the first data
match. CMS determined that these 59,918 TRICARE beneficiaries could be
categorized into three groups. The first group comprised 32,044 TRICARE
beneficiaries who were not enrolled in Part B and the second group
comprised 18,700 TRICARE beneficiaries who were enrolled in Part B and
were paying premium surcharges for their late enrollment. The third
group comprised 9,174 TRICARE beneficiaries who had enrolled in Part B
during the 2004 January-March general enrollment period. CMS offered
this third group the option of making their Part B coverage retroactive
to as early as January 2004, instead of the customary July 1 effective
date for general enrollment.[Footnote 15] After SSA reviewed the CMS
data, in July 2004, SSA determined that a total of 49,117 TRICARE
beneficiaries were not enrolled in Part B or were enrolled and eligible
for premium surcharge waivers and surcharge repayments. Although SSA
processed most--47,803--of these cases[Footnote 16] through its
automated processing system, 1,314 were rejected by this system and had
to be processed manually.[Footnote 17] SSA officials explained that the
data that they provided to us were from its automated systems and, as a
result, did not include information on the Part B enrollments and
repayments for the 1,314 TRICARE beneficiaries whose cases were
manually processed.
From the second data match, CMS identified a total of 57,480 TRICARE
beneficiaries as potentially eligible for the Section 625 enrollment
incentives, including an unknown number of TRICARE beneficiaries who
were identified by both data matches. CMS officials explained that
TRICARE beneficiaries who had either declined Part B or had allowed
their coverage to lapse by the time the second match was conducted
would have been identified by both data matches. According to
information in CMS's enrollment database, of those TRICARE
beneficiaries who were entitled to premium-free Part A, (1) 55,102
TRICARE beneficiaries were not enrolled in Part B and (2) 2,378 TRICARE
beneficiaries were enrolled in Part B and potentially due premium
surcharge waivers and surcharge repayments.
SSA reviewed the CMS data and determined that a total of 41,345 TRICARE
beneficiaries were either not enrolled in Part B or eligible for
premium surcharges to be waived and repayments of their 2004
surcharges. However, of these 41,345 TRICARE beneficiaries, SSA was
able to issue notices about enrolling in Part B and process premium
surcharge waivers, and repayments for 40,703 through its automated
systems. This number excludes 642 cases that were not processed by
SSA's automated processing system. According to SSA officials, some of
the TRICARE beneficiaries associated with these cases could have
enrolled or pursued repayment of their premium surcharges through their
local SSA field offices. Because these cases were manually processed,
they were also not included in the data that SSA provided to us.
A total of 43,948 TRICARE beneficiaries had been served under Section
625 by December 2005, according to data from SSA's automated processing
system. As shown in table 1, SSA enrolled 25,697 TRICARE beneficiaries
in Part B and repaid premium surcharges to an additional 18,251 TRICARE
beneficiaries. Initially, only TRICARE beneficiaries who received
Social Security benefit checks received repayments for their premium
surcharges. Those whom CMS billed for Part B coverage had their premium
surcharges credited toward future premiums.
Table 1: Section 625 of MMA Part B Enrollments and Premium Surcharges
Repaid by SSA, as of December 2, 2005:
Number of TRICARE beneficiaries SSA enrolled in Part B[A];
First match: 21,956;
Second match: 3,741;
Total: 25,697.
Number of TRICARE beneficiaries who received repayments[B];
First match: 16,525;
Second match: 1,726;
Total: 18,251.
Average amount repaid[B];
First match: $309.96;
Second match: $524.00;
Total: [Empty].
Source: GAO analysis of SSA data.
[A] According to SSA, 9,322 of the 31,278 eligible TRICARE
beneficiaries identified by the first match declined Part B coverage;
many were already enrolled in a group health plan.
[B] The TRICARE beneficiaries who received repayments as a result of
the first data match are not included among those who received
repayments as a result of the second data match.
[End of table]
CMS subsequently determined that it would repay, rather than credit,
premium surcharges for qualifying TRICARE beneficiaries. In May 2005,
CMS identified 462 TRICARE beneficiaries who were billed for Part B and
qualified for repayments under Section 625 of MMA. According to CMS, by
the time the agency identified these 462 TRICARE beneficiaries, 195 of
them had already had the money credited for their Part B premiums. By
the end of June 2005, SSA had notified TRICARE beneficiaries of their
premium surcharge refunds and Medicare repaid $112,300 to 267 of these
beneficiaries whose credit balances had not been depleted. In addition,
CMS determined that it would repay the premium surcharges for any
additional TRICARE beneficiaries who qualified under Section 625 of
MMA, but had not yet been identified as eligible. In total, SSA and CMS
repaid or credited 18,713 TRICARE beneficiaries for the premium
surcharges they had paid for 2004 Part B coverage.
Not All Aspects of Section 625 Implementation Are Known:
Despite the availability of much data, some details concerning the
law's implementation are unknown. SSA officials noted that the agency's
automated processing system did not track the number of TRICARE
beneficiaries who changed the effective date of their Part B coverage,
as a result of Section 625 of MMA. SSA also could not identify the
number of appeals filed by TRICARE beneficiaries that were affected by
Section 625. Although SSA tracked the number of TFL-related inquiries
that its field offices had received since January 2004, the agency had
not determined whether those nearly 15,000 inquiries resulted in
additional enrollments, waivers of premium surcharges, or repayments
for premium surcharges. According to SSA, it determined that because of
the relatively small size of the TRICARE workload, it would not be cost
effective to change its reporting systems to capture this information.
Finally, none of the involved organizations--DMDC, TMA, CMS, or SSA--
tracked data on the disposition of cases involving undelivered mail.
Consequently, the number of TRICARE beneficiaries who never received
notices is unknown.
Agency Comments:
We provided a draft of this report to CMS, DOD, and SSA. We received
written comments from CMS and DOD. We have reprinted CMS's and DOD's
letters in enclosures I and II, respectively. SSA also provided us with
comments by e-mail. All three agencies generally concurred with our
findings and provided additional information clarifying their
respective roles in the implementation of Section 625. We revised our
report to reflect this information. All three agencies also offered
technical comments, which we incorporated as appropriate.
As agreed with your offices, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
after its date. At that time, we will send copies to the Secretary of
Defense, the Secretary of Health and Human Services, the Administrator
of CMS, the Commissioner of SSA, and other interested parties. We will
also make copies available to others upon request. In addition, this
report will be available at no charge on GAO's Web site at [Hyperlink,
http://www.gao.gov].
If you or your staff have any questions about this report, please
contact me at (312) 220-7600 or aronovitzl@gao.gov. Contact points for
our Offices of Congressional Relations and Public Affairs may be found
on the last page of this report. Geraldine Redican-Bigott, Assistant
Director; Enchelle Bolden; Chir-Jen Huang; Kevin Milne; and Jessica
Cobert Smith made key contributions to this report.
Signed by:
Leslie G. Aronovitz:
Director, Health Care:
Enclosures --2:
Comments from the Centers for Medicare & Medicaid Services:
Department Of Health & Human Services:
Centers for Medicare & Medicaid Services:
200 Independence Avenue SW:
Washington, DC 20201:
Date: May 25 2006:
To: Leslie G. Aronovitz:
Director, Health Care:
Government Accountability Office:
From: Mark B. McClellan, M.D., Ph.D.
Administrator:
Centers for Medicare & Medicaid Services:
Subject: Government Accountability Office's (GAO) Draft Correspondence:
"TRICARE: Enrollment of the Department of Defense's TRICARE
Beneficiaries in Medicare Part B" (GAO-06-489R):
Thank you for the opportunity to review and comment on the GAO draft
correspondence entitled, "TRICARE: Enrollment of the Department of
Defense's TRICARE Beneficiaries in Medicare Part B." The CMS and the
DoD have taken steps to ensure that TRICARE beneficiaries understand
the relationship between Medicare and TRICARE. CMS continually advises
beneficiaries through our Initial Enrollment Period package, the
Medicare & You handbook, and our Web site that enrollment in Medicare
Part B is required to retain coverage under TRICARE. Upon notification
from CMS, via our data exchanges, that a TRICARE beneficiary is not
enrolled in Part B, the DoD sends a letter to the beneficiary, advising
that Part B coverage is required to maintain TRICARE coverage. We hope
these efforts assist our beneficiaries in making informed health care
choices.
Overall we concur with the draft correspondence's discussion of the
efforts put forth by the Centers for Medicare & Medicaid Services
(CMS), the Department of Defense (DoD), and the Social Security
Administration (SSA) to implement section 625 of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (MMA).
This legislation provided a special enrollment period for Medicare Part
B for TRICARE beneficiaries who are entitled to Medicare Part A.
Additionally, it required that the premium surcharge for late
enrollment incurred by TRICARE beneficiaries be removed, beginning
January 2004, and refunded to the beneficiaries. The special enrollment
period and removal of the premium surcharge was to begin as soon as
possible after enactment and end on December 31, 2004.
The implementation of the law required a collaborative effort between
the three Federal agencies. As a result, over 44,000 TRICARE
beneficiaries were enrolled in Medicare Part B or received a refund of
surcharges paid beginning January 2004.
The primary challenges for the agencies were to identify an unknown
number of beneficiaries who met the requirements of the legislation and
to develop an enrollment and repayment process that would require no
action on the part of the beneficiary. As the Federal agency
responsible for developing national policy and procedures for
eligibility, enrollment, and entitlement processes for Part A and Part
B of the Medicare program, CMS determined that under the law, TRICARE
beneficiaries could be automatically enrolled in Part B, thereby
alleviating the requirement for each beneficiary to file an application
for Part B.
Since neither CMS nor SSA could identify TRICARE beneficiaries in their
respective data bases, the DoD provided to CMS identifying data for all
TRICARE eligible beneficiaries via a data match. CMS used this data to
identify those TRICARE beneficiaries who met the requirements of
section 625 of the MMA. This beneficiary data was then sent to SSA to
process the Part B enrollments, remove the premium surcharge, refund
surcharges, and issue notices to the affected beneficiaries. The Part B
enrollments were processed on August 31, 2004. The Part B enrollment
and surcharge repayment process was also completed on August 31, 2004.
By September 10, 2004, all notices had been issued to the
beneficiaries.
Each of the agencies posted fact sheets on their Web sites that
explained the automatic enrollment and premium surcharge repayment
process: that beneficiaries would receive a letter from SSA advising
them that they had been automatically enrolled in Part B, effective
September 1, 2004, or that the premium surcharge had been removed and
they would receive a refund of surcharges paid. The fact sheets also
provided instructions for beneficiaries to contact SSA if they believed
that they were eligible to enroll in Part B or to receive a premium
surcharge repayment and they did not receive a letter from SSA by
October 2004.
Despite our initial efforts, some beneficiaries were not identified as
being eligible for the provisions of section 625 of the MMA. To address
this situation CMS, SSA, and DoD performed a second data match as
quickly as possible and extended the special enrollment period until
June 30, 2005. Because there was no statutory limitation for removing
and repayment of the premium surcharge, an extension for this provision
was not required. All identified beneficiaries were given the same
considerations as those previously identified in the first data match,
except that beneficiaries who were not enrolled in Part B were not
automatically enrolled. These beneficiaries would have to request Part
B enrollment. To ensure that all beneficiaries would be given the
opportunity to enroll in Part B, CMS provided instructions to SSA to
enroll TRICARE beneficiaries in Part B, if, for any reason they had not
been identified.
Thank you for your efforts to study this matter. Attached are our
technical comments on this correspondence for your consideration.
Attachment:
Comments from the Department of Defense:
The Assistant Secretary Of Defense:
1200 Defense Pentagon Washington, DC 20301-1200:
Health Affairs:
May 3 2006:
Ms. Leslie G. Aronovitz:
Director, Health Care:
U.S. Government Accountability Office:
441 G Street, N.W.
Washington, D.C. 20548:
Dear Ms. Aronovitz:
This is the Department of Defense (DoD) response to the proposed report
to Congress titled: "TRICARE: Enrollment of the Department of Defense's
TRICARE Beneficiaries in Medicare Part B."
The report provides a good summary of the process and actions taken by
DoD, the Defense Manpower Data Center, the Centers for Medicare/
Medicaid Services, and the Social Security Administration to implement
the provisions of Section 625 of the Medicare Prescription Drug,
Improvement and Modernization Act of 2003. Incorporating the attached
technical comments will improve the accuracy of the report.
My points of contact on this topic are Ms. Anne Breslin at (703) 681-
0039, extension 3605 and Mr. Gunther J. Zimmerman (Audit Liaison) at
(703) 681-3492, ext. 4065.
Sincerely,
Signed by:
William Winkenwerder, Jr., MD:
Attachment: As stated:
GAO Draft Report - Dated April 18, 2006 (GAO CODE - 290475/GAO-06-
XXXX):
"TRICARE: Enrollment of the Department of Defense's TRICARE
Beneficiaries in Medicare Part B" (GAO-06-489R):
Department Of Defense Comments:
The proposed report contains no recommendations; however, the
Department would like to offer several comments.
Overall Comments:
* The report provides a good summary of the process and actions taken
by DoD, DMDC, CMS and SSA to implement the provisions of Section 625 of
the Medicare Prescription Drug, Improvement and Modernization Act of
2003.
* Incorporating the technical comments attached will improve the
accuracy of the report.
(290475):
FOOTNOTES
[1] Hereafter, we use the term TRICARE beneficiaries to include
military retirees and their dependents and survivors who are entitled
to Medicare Part A.
[2] Medicare Part A covers inpatient hospital, skilled nursing
facility, hospice, and certain home health services. Part B covers
certain physician, outpatient hospital, laboratory, and other services.
Another component of the Medicare program is Part D, which provides
prescription drug coverage for Medicare beneficiaries.
[3] Pub. L. No. 108-173, § 625, 117 Stat. 2066, 2317-18 (2003).
[4] The DEERS database contains the service-related and demographic
data that are used to determine eligibility for military benefits,
including health care, for all active duty servicemembers, military
retirees, and the dependents and survivors of activity duty
servicemembers and military retirees. As individuals join the military,
the various services enter information on them into DEERS and update
the information as their military status changes. The individual
servicemember is responsible for providing information to DEERS on
dependents and for reporting changes concerning dependents.
[5] See GAO, Defense Health Care: TRICARE Claims Processing Has
Improved but Inefficiencies Remain, GAO-04-69 (Washington, D.C.: Oct.
15, 2003), and Defense Health Care: Most Reservists Have Civilian
Health Coverage but More Assistance Is Needed When TRICARE Is Used, GAO-
02-829 (Washington, D.C.: Sept. 6, 2002).
[6] The Railroad Retirement Board (RRB) also enrolls Medicare
beneficiaries and collects Part B premiums on behalf of CMS. Less than
0.2 percent of the TRICARE beneficiaries targeted by Section 625 of MMA
were RRB annuitants; as a result, we did not include this agency in the
scope of our review.
[7] Pub. L. No. 106-398, § 713, 114 Stat. 1654, 1654A-179.
[8] Most people are entitled to Part A without paying a premium because
they or their spouses already paid for this coverage through employer
payroll deductions, including deductions paid while in military
service. However, some people may not qualify for premium-free Part A
because they or their spouses did not work or did not pay enough in
Medicare taxes while employed. Most persons age 65 or older must have
worked 10 years, or 40 quarters, to receive coverage for premium-free
Part A. The Part A premium for people who are not eligible for premium-
free Part A with less than 30 quarters of coverage was $343 per month
in 2004 and $375 per month in 2005. The Part A premium for people not
entitled to premium-free Part A but with 30 or more quarters of
coverage was $189 per month in 2004 and $206 per month in 2005.
[9] The Medicare Part B premium is adjusted annually, based on the
program's projected costs for the coming year. The premium for 2005 was
$78.20 per person, per month. The premiums for 2001 through 2004 were
$50.00, $54.00, $58.70, and $66.60, respectively.
[10] MMA called for the special enrollment period to begin as soon as
possible following the law's enactment. Because it took 5 months to
finalize implementation procedures, CMS identified the third group of
TRICARE beneficiaries--those who had enrolled during the 2004 general
enrollment period--and offered them the option of beginning Part B
coverage sooner than the customary July 1 effective date.
[11] The DMDC categories were for TRICARE beneficiaries who were
entitled to premium-free Medicare Part A and were (1) under age 65 and
not enrolled in Part B, (2) age 65 and over and not enrolled in Part B,
or (3) enrolled in the Uniformed Services Family Health Plan--a TRICARE
managed care option that is only available in six areas of the country.
The letters to the first and second groups contained information on
their upcoming automatic enrollment in Part B, the monthly or quarterly
Part B premiums they would need to pay, and the consequences of
declining Part B coverage. The letter to the third group explained that
once they disenrolled from the Uniformed Services Family Health Plan,
they would need to immediately enroll in Medicare Part B for continued
TRICARE coverage under TFL.
[12] Because the 2005 general enrollment period had just begun, CMS did
not separately identify TRICARE beneficiaries who enrolled during
general enrollment, as it had done for the first data match.
[13] An SSA official told us that the agency generally gives people 3
months to respond to an agency notice, so that an enrollment notice
sent in March 2005 would typically give an individual until June 2005
to respond and elect Part B coverage.
[14] An SSA official told us that in addition to the TRICARE
beneficiary, a spouse and dependents may also be receiving benefits
based on the TRICARE beneficiary's Social Security number. Therefore,
one Social Security number may have multiple TRICARE beneficiaries
associated with it.
[15] This group of TRICARE beneficiaries was also entitled to a
repayment of the premium surcharges they might have paid for 2004 Part
B coverage.
[16] SSA defines a case as a matter affecting a record associated with
a specific Social Security number and possibly involving multiple
Social Security beneficiaries.
[17] An SSA official explained that the agency's automated claims
processing system can reject a case from being processed automatically
for numerous reasons, including missing or conflicting information.
GAO's Mission:
The Government Accountability Office, the investigative arm of
Congress, exists to support Congress in meeting its constitutional
responsibilities and to help improve the performance and accountability
of the federal government for the American people. GAO examines the use
of public funds; evaluates federal programs and policies; and provides
analyses, recommendations, and other assistance to help Congress make
informed oversight, policy, and funding decisions. GAO's commitment to
good government is reflected in its core values of accountability,
integrity, and reliability.
Obtaining Copies of GAO Reports and Testimony:
The fastest and easiest way to obtain copies of GAO documents at no
cost is through the Internet. GAO's Web site ( www.gao.gov ) contains
abstracts and full-text files of current reports and testimony and an
expanding archive of older products. The Web site features a search
engine to help you locate documents using key words and phrases. You
can print these documents in their entirety, including charts and other
graphics.
Each day, GAO issues a list of newly released reports, testimony, and
correspondence. GAO posts this list, known as "Today's Reports," on its
Web site daily. The list contains links to the full-text document
files. To have GAO e-mail this list to you every afternoon, go to
www.gao.gov and select "Subscribe to e-mail alerts" under the "Order
GAO Products" heading.
Order by Mail or Phone:
The first copy of each printed report is free. Additional copies are $2
each. A check or money order should be made out to the Superintendent
of Documents. GAO also accepts VISA and Mastercard. Orders for 100 or
more copies mailed to a single address are discounted 25 percent.
Orders should be sent to:
U.S. Government Accountability Office
441 G Street NW, Room LM
Washington, D.C. 20548:
To order by Phone:
Voice: (202) 512-6000:
TDD: (202) 512-2537:
Fax: (202) 512-6061:
To Report Fraud, Waste, and Abuse in Federal Programs:
Contact:
Web site: www.gao.gov/fraudnet/fraudnet.htm
E-mail: fraudnet@gao.gov
Automated answering system: (800) 424-5454 or (202) 512-7470:
Public Affairs:
Jeff Nelligan, managing director,
NelliganJ@gao.gov
(202) 512-4800
U.S. Government Accountability Office,
441 G Street NW, Room 7149
Washington, D.C. 20548:
