Ask Kim


Military Health Coverage and Health Reform

Kimberly Lankford

People receiving health benefits through TRICARE won't have to purchase additional coverage or pay a penalty when insurance is required for all in 2014.



Is there any chance that members of the military and their families will have to pay a penalty for not having the right kind of coverage after everyone is required to have health insurance in 2014?

No, members of the military and their families, military retirees who are covered by TRICARE, and veterans covered by the veterans health-care program will not have to pay a penalty after insurance is required in 2014.

The health-care reform law requires U.S. citizens and legal residents to have health insurance by 2014 or pay a penalty that starts at $95 or 1% of income in 2014, rising to $695 or 2.5% of income in 2016. To avoid the penalty, you must have "minimum essential coverage." This coverage can be from an employer or an individual policy. The law also states that Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), TRICARE for Life (Medicare supplemental coverage for military retirees) and the veterans health-care program qualify as minimum essential coverage. However, it didn’t mention TRICARE, which is the health-care program for members of the military, their families and military retirees.

Despite assurances by the secretary of Health and Human Services that TRICARE would be considered qualifying coverage, Congress wanted to clear up any confusion and unanimously passed the TRICARE Affirmation Act, which was signed into law on April 26. It specifies that TRICARE counts as minimum essential coverage. People who receive health benefits through this program will not have to purchase additional coverage and will not face a penalty after insurance is required in 2014.

For more information about health-care reform, see our Health-Care Reform special report. For more information about personal finances for military families, see our Money Guide for Your Military Family.

Got a question? Ask Kim at askkim@kiplinger.com.



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