How the Tricare Catastrophic Cap Affects Your Healthcare Costs

Tricare medical coverage is one of the greatest benefits of military service and one of the greatest things about Tricare are the catastrophic low caps that limit the total amount you’ll pay for covered medical care in a year. Sometimes called maximum disbursements, catastrophic caps vary by status, when the sponsor joined the military, and Tricare coverage, but they’re all fairly low compared to most civilian plans. For 2021, the catastrophic caps range from $1,000 per year to $3,703 per year.

What are Tricare Group A and Group B?

The first thing to understand about your catastrophic ceiling is which Tricare group you belong to.

You are in Group A if your sponsor’s initial enrollment or appointment took place before January 1, 2018.

You are in Group B if your sponsor’s initial enrollment or appointment took place on or after January 1, 2018.

Your military status

For the purposes of Tricare’s catastrophic caps, there are four statuses and one sub-status.

Active family members have a 2021 catastrophic cap of $1,000 for Group A beneficiaries and $1,058 for Group B beneficiaries.

Military retirees and the catastrophic cap for their family members depends on their group and, for Group A, the Tricare plan they are using – see below.

Tricare Reserve Select and their family members are still using Group B fares, so their catastrophic cap for 2021 is $1,058.

Tricare Retired Reserve and their family members are still using Group B fares, so their catastrophic cap for 2021 is $3,703 per year.

Tricare Young Adult recipients use the catastrophic cap for their sponsor’s status, but still at Group B rates. This creates some confusion because the TYA recipient may have a different catastrophic cap than the rest of the family, even though all of their costs contribute at the same ceiling.

Military retirees and their Tricare plan

For retirees, the catastrophic cap is group-based and may vary depending on the plan selected.

Group B military retirees and their families have a catastrophic cap of $3,703 per year in 2021.

The catastrophic cap for Group A retirees depends on the Tricare plan used. This is a new change in 2021. For 2021, Group A pensioners and their families using Tricare Premier have a catastrophic cap of $3,000 per year. Group A pensioners and their families using Tricare Select have a catastrophic cap of $3,500.

What counts towards your catastrophic ceiling?

Tricare counts everything but premiums toward your catastrophic cap, including enrollment fees, deductibles, co-payments, and pharmacy fees. It is important to note the difference between a registration fee and a premium. The monthly cost paid by a retiree and their family for Tricare is an enrollment fee, and that enrollment fee counts toward the catastrophic cap. The monthly cost paid for Tricare Reserve Select, Tricare Retired Reserve, Tricare Young Adult, and Continuing Health Care Benefit Program is a premium, and premiums do not count toward the catastrophic cap.

If, or when, your family reaches your catastrophic cap for the year, you are no longer responsible for the cost of the Tricare-authorized portion of covered care. Tricare covers all remaining covered costs.

Understanding your catastrophic ceiling makes it easier to create a health care budget. Our family takes our catastrophic cap, divides it by 12, and sets aside that amount in an account each month. When we have health care expenses, money is available to pay those bills. Understanding your catastrophic caps also helps you compare other health coverage options, such as an employer-sponsored policy. This is an important part of your health care coverage to understand.

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