[Federal Register Volume 70, Number 50 (Wednesday, March 16, 2005)]
[Rules and Regulations]
[Pages 12798-12805]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-5219]


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DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Part 199

[DoD 6010.8-R]
RIN-0720-AA90


Civilian Health and Medical Program of the Uniformed Services 
(CHAMPUS); TRICARE Reserve Select for Certain Members of the Selected 
Reserve; Transitional Assistance Management Program; Early Eligibility 
for TRICARE for Certain Reserve Component Members

AGENCY: Office of the Secretary, DoD.

ACTION: Interim final rule with comment period.

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SUMMARY: This interim final rule establishes requirements and 
procedures for implementation of TRICARE Reserve Select. It also 
revises requirements and procedures for the Transitional Assistance 
Management Program. In addition, it establishes

[[Page 12799]]

requirements and procedures for implementation of the earlier TRICARE 
eligibility for certain reserve component members. The rule is being 
published as an interim final rule with comment period in order to 
comply with statutory effective dates.

DATES: This rule is effective April 15, 2005. Submit comments on or 
before May 16, 2005.

ADDRESSES: Because of staff and resource limitations, we cannot accept 
comments by facsimile (FAX) transmission or e-mail. Mail written 
comments to the following address ONLY: TRICARE Management Activity, 
TRICARE Operations/Strategic Initiatives Division, Sky 5 Suite 810, 
5111 Leesburg Pike, Falls Church, VA 22041-3206; Attention: Jody 
Donehoo, Program Analyst.

FOR FURTHER INFORMATION CONTACT: Jody Donehoo, Office of the Assistant 
Secretary of Defense (Health Affairs), telephone (703) 681-0039.
    Questions regarding payment of specific claims under the TRICARE 
allowable charge method should be addressed to the appropriate TRICARE 
contractor.

SUPPLEMENTARY INFORMATION: 

I. Introduction and Background

    The Ronald W. Reagan National Defense Authorization Act for Fiscal 
Year 2005 (NDAA-05) (Pub. L. 108-375) contains several provisions to 
enhance health care benefits for reservists and their family members. 
Three of the provisions are addressed in this interim final rule. 
First, section 701 provides for premium-based medical coverage for 
certain members of the Selected Reserve and their eligible family 
members. Section 706 makes permanent the temporary revisions to the 
Transitional Assistance Management Program, enacted in section 704 of 
the National Defense Authorization Act for Fiscal Year 2004 (NDAA-04) 
(Pub. L. 108-136) and section 1117 of the Emergency Supplemental 
Appropriations Act for the Reconstruction of Iraq and Afghanistan, 2004 
(Emergency Supplemental) (Pub. L. 108-106). Section 703 makes permanent 
the earlier TRICARE eligibility for certain reserve component members 
authorized by section 703 of NDAA-04 and section 1116 of the Emergency 
Supplemental.
    These provisions represent significant enhancements to the health 
care benefits available to reservists and their eligible family 
members. They focus particularly on reservists and guardsmen activated 
in support of a contingency operation after September 11, 2001. Prior 
to the statutory changes enacted since November 2003, reservists and 
their families received TRICARE health care benefits when activated for 
more than 30 consecutive days. Now, TRICARE benefits begin up to 90 
days prior to activation for those who receive delayed-effective-date 
orders, and coverage is extended to a full 180 days after a period of 
active service in support of a contingency operation. These changes 
provide for an easier transition to and from civilian life. And, for 
those who served in support of a contingency operation and who commit 
to continued service in the Selected Reserve, a new health benefits 
program will allow them to obtain through TRICARE health coverage 
comparable to that available to full-time civilian employees of the 
Department of Defense. This new program is called ``TRICARE Reserve 
Select.'' It is subject to a number of specific statutory requirements, 
which are outlined in this regulation.

II. Provisions of the Rule Regarding the Tricare Reserve Select Program

    A. Establishment of the TRICARE Reserve Select Program (paragraph 
199.24(a)). This paragraph describes the nature, purpose, statutory 
basis, scope, and major features of TRICARE Reserve Select, a premium-
based medical coverage program that will be available to certain 
members of the Selected Reserve and their dependents. TRICARE Reserve 
Select is authorized by 10 U.S.C. 1076d, and is applicable worldwide. 
The major features of the program include the following: TRICARE rules 
apply unless otherwise specified; certain special TRICARE programs are 
not part of TRICARE Reserve Select, including the Supplemental Health 
Care Program, the Extended Health Care Option (ECHO) program, and the 
Special Supplemental Food Program (also known as the Women, Infants, 
and Children--Overseas Program). The TRICARE Dental Program is already 
available under 10 U.S.C. 1076a to all members of the Selected Reserve 
and their family members whether or not they enroll in TRICARE Reserve 
Select. Under TRICARE Reserve Select, eligible Selected Reserve members 
may enroll for self-only or self and family coverage. When their 
enrollment becomes effective, TRICARE Reserve Select beneficiaries 
receive the TRICARE Standard benefit. TRICARE Reserve Select features 
the deductible and cost share provisions of the TRICARE Standard plan 
for active duty family members (ADFM) for both the member and eligible 
family members.
    B. Eligibility for enrollment in TRICARE Reserve Select (paragraph 
199.24(b)). This paragraph defines who is eligible to enroll in TRICARE 
Reserve Select, based on statutory provisions. To be eligible, a person 
must be a member of a reserve component of the armed forces, who serves 
on active duty for 90 consecutive days or more related to a contingency 
operation on or after September 11, 2001, and, on or before the date of 
release from active duty, agrees to serve continuously in the Selected 
Reserve for a period of one or more whole years following release from 
active duty, and, if not already a member of the Selected Reserve, 
actually begins serving in the Selected Reserve prior to the date upon 
which TRICARE Reserve Select coverage is effective. The member must 
meet the qualifications for continued service in the Selected Reserve 
as determined by the member's reserve component. If the member was 
released from active duty on or before April 26, 2005, the member has 
until October 28, 2005, to sign an agreement to serve continuously in 
the Selected Reserve for a period of one or more whole years in order 
to be eligible to enroll in TRICARE Reserve Select. This temporary 
opportunity (until October 28, 2005) applies to current members of the 
Selected Reserve, and also to former members who served in support of a 
contingency after 9/11, rejoin the Selected Reserve, and enter into an 
agreement for continued service. In conformance with section 
701(b)(2)(B) of the NDAA-05, the Department will take reasonable steps 
to the maximum extent practicable to notify reservists released from 
active duty on or before April 26, 2005, who may be eligible for 
TRICARE Reserve Select and provide them information on the opportunity 
and procedures for entering into an agreement together with a clear 
explanation of the benefits that the member is eligible to receive 
under TRICARE Reserve Select as a result of entering into such 
agreement. Eligible family members of eligible reserve members enrolled 
in TRICARE Reserve Select are also eligible for enrollment in TRICARE 
Reserve Select. Eligibility determinations are the responsibility of 
the Reserve Components of the Armed Services.
    C. TRICARE Reserve Select enrollment procedures (paragraph 
199.24(c)). In order to be covered under TRICARE Reserve Select, 
eligible reserve component members released from active duty after 
April 26, 2005, must enter into an agreement prior to being released to 
serve continuously in the reserves for a period of one or more

[[Page 12800]]

whole years following such date, and the member must meet the 
qualifications for continuous service in the Selected Reserve as 
determined by the member's reserve component. The member must then 
enroll by signing the appropriate TRICARE enrollment form and 
submitting the initial monthly premium to the appropriate TRICARE 
contractor, not later than 30 days prior to the end of their 
Transitional Assistance Management Program benefit period. A member may 
elect self-only or self and family coverage, and may enroll for one 
year of TRICARE Reserve Select coverage for every 90 days of continuous 
active-duty service, to the extent that the member agrees to continue 
service in the Selected Reserves for the same number of years after 
coverage begins. Members released from active duty on or before April 
26, 2005 may enroll in TRICARE Reserve Select upon execution of the 
agreement to serve continuously in the Selected Reserve. Coverage 
becomes effective the later of the end of TAMP coverage or the 
effective date of the agreement to serve in the Selected Reserve.
    Except for members released from active duty on or before April 26, 
2005, enrollment in TRICARE Reserve Select must be accomplished prior 
to the expiration of Transition Assistance Management Program (TAMP) 
benefits, and coverage begins at the expiration of TAMP benefits and 
runs continuously until eligibility expires or is otherwise terminated. 
When enrollment is terminated or the member is otherwise disenrolled, a 
member may not re-enroll unless recalled to active duty and the member 
re-qualifies for this benefit.
    For eligible members, the decision to enroll in TRICARE Reserve 
Select or to decline enrollment is a one-time choice. If it is 
declined, or if coverage is taken for a period less than the maximum 
period of eligibility, coverage may not be initiated or extended later, 
nor may any period of eligibility be saved until later. Thus, for 
example, if a member served for one year in support of a contingency 
operation, the member earns potential eligibility for the next four 
years if the member agrees to continue service in the Selected Reserves 
for four years. However, if that member elects to continue service in 
the Selected Reserve for only two years, the member will qualify for 
only two years of TRICARE Reserve Select coverage. This two-year 
coverage period cannot be extended later, even if the member later 
extends Selected Reserve service for two more years. The only way to 
extend TRICARE Reserve Select coverage beyond the period determined 
when the one-time choice is made is by re-qualifying through another 
period of active duty service in support of a contingency operation.
    If, while enrolled in TRICARE Reserve Select a member is recalled 
to active duty for a period of more than 30 consecutive days, TRICARE 
Reserve Select coverage is superseded by active duty military health 
benefits for the member and the member's immediate family, but the 
coverage period continues to run. When the member is released from 
active duty, TRICARE Reserve Select coverage will resume for the member 
and the member's immediate family provided the member had been enrolled 
in family coverage on the date TRICARE Reserve Select coverage was 
superseded by active duty health benefits. TRICARE Reserve Select 
coverage will continue until the member's eligibility expires, is 
otherwise terminated, or the member is disenrolled. Following the 
member's release from active duty, TRICARE Reserve Select coverage will 
be further superseded by TAMP benefits, if applicable. In addition, 
TRICARE Reserve Select coverage is also superseded, if applicable, by 
any period of early TRICARE coverage based on delayed-effective-date 
orders or by a new enrollment, as a result of re-qualifying through 
another period of active duty service in support of a contingency 
operation. During any period in which TRICARE Reserve Select coverage 
is superseded, no premium payments for TRICARE Reserve Select are due 
for the period being superseded.
    Under certain circumstances, reserve members may change their 
TRICARE Reserve Select type of coverage. After initial enrollment, the 
reserve member may not change from self-only to self and family 
enrollment, or change from self and family enrollment to self-only 
enrollment, except on the occasion of certain events affecting the 
family, such as the birth of a child, the marriage or divorce of the 
sponsor, the legal adoption of a child, or placement by a court of a 
child as a legal ward in the sponsor's home, or certain events 
affecting family health coverage, such as an employment change of the 
member or spouse. It is the responsibility of the TRS member to provide 
the necessary evidence required regarding the circumstances permitting 
the change in enrollment to the appropriate TRICARE contractor. The 
Director, TRICARE Management Activity shall issue guidelines as 
necessary to implement these provisions. All such changes are effective 
prospectively.
    Failure to make a premium payment in a timely manner will result in 
permanent disenrollment of the member and the member's immediate family 
and denial of claims for services received on or after the effective 
date of disenrollment, which is the end of the last month for which the 
premium was paid. Members and their immediate family will not be 
allowed to re-enroll, unless the member qualifies for a new period of 
eligibility.
    A reserve member whose service in the Selected Reserve ends is 
automatically disenrolled, along with the member's eligible family 
members, based on the date the member terminated service in the 
Selected Reserve.
    D. TRICARE Reserve Select premiums (paragraph 199.24(d)). Annual 
premiums are charged for coverage under TRICARE Reserve Select. 
Premiums are to be paid monthly, except as otherwise established as 
part of the administrative implementation of TRICARE Reserve Select. 
The monthly premium rates are established and updated annually on a 
calendar year basis and are effective on the first of January each 
year, for the two types of coverage--self-only and self and family. The 
rates are based on 28 percent of the total estimated amount reasonable 
for coverage under the TRICARE Standard benefit for the TRICARE Reserve 
Select eligible population, as determined by the Assistant Secretary of 
Defense (Health Affairs) (ASD(HA)) on an appropriate actuarial basis. 
The monthly rate for each month of a calendar year is one-twelfth of 
the annual rate for that calendar year, rounded to the nearest dollar.
    Annual rates are based on the annual premiums for the Blue Cross 
and Blue Shield Standard Service Benefit Plan under the Federal 
Employees Health Benefits Program, a nationwide plan closely resembling 
TRICARE Standard coverage, with adjustments based on demographic 
differences in covered populations, as determined by the ASD(HA). Based 
on an analysis of demographic differences between Blue Cross and Blue 
Shield participants and beneficiaries eligible for TRICARE Reserve 
Select, the adjustment amount is for purposes of calendar year 2005 a 
32 percent reduction from the Blue Cross and Blue Shield annual premium 
for self-only coverage and an 8 percent reduction from the Blue Cross 
and Blue Shield annual premium for self and family coverage. (The 
difference in the percentage reductions between self-only and self and 
family premiums is due to the disproportionately high number of high 
cost, single, elderly retiree federal employees covered by Blue Cross 
and Blue Shield self-only coverage.)

[[Page 12801]]

Premiums will be adjusted annually to maintain an appropriate 
relationship with the annual changes in Blue Cross and Blue Shield 
premiums.
    In addition to these annual premium changes, premium adjustments 
may also be made prospectively for any calendar year to reflect any 
significant program changes or any actual experience in the costs of 
administering the TRICARE Reserve Select Program.
    For calendar year 2005, the annual premium for self-only coverage 
is $900 (monthly premium $75), and the annual premium for self and 
family coverage is $2,796 (monthly premium $233). These premiums will 
change effective January 2006.
    E. Relationship to Continued Health Care Benefits Program (CHCBP) 
(paragraph 199.24(e)). This paragraph addresses the relationship 
between TRICARE Reserve Select and the CHCBP. CHCBP is a program that 
(among other things) allows members released from active duty to 
purchase continued health care coverage through TRICARE. This coverage 
is available for a period of 18 months. Some members at the time of 
release from active duty will be eligible for either TRICARE Reserve 
Select or CHCBP. This paragraph of the regulation provides that if a 
member enrolls in TRICARE Reserve Select, but later is disenrolled, the 
member or the covered family members may then activate CHCBP coverage 
for whatever period is remaining of the original 18 month eligibility. 
For example, in the case that TRICARE Reserve Select enrollment is 
ended because of discharge from the Selected Reserve (such as through a 
reduction in force or base closure) of a member within 18 months of 
release from active duty, the member could choose to continue health 
care coverage under CHCBP for the remainder of the period at the 
applicable CHCBP premiums.
    F. Preemption of State laws (paragraph 199.24(f)). This paragraph 
explains that the preemptions of State and local laws established for 
the TRICARE program also apply to TRICARE Reserve Select. Any State or 
local law or regulation pertaining to health insurance, prepaid health 
plans, or other health care delivery, administration, and financing 
methods is preempted and does not apply in connection with TRICARE 
Reserve Select. This includes State and local laws imposing premium 
taxes on health insurance carriers or underwriters or other plan 
managers, or similar taxes on such entities. Preemption does not apply 
to taxes, fees, or other payments on net income or profit realized by 
such entities in the conduct of business relating to DoD health 
services contracts, if those taxes, fees or other payments are 
applicable to a broad range of business activity. For the purposes of 
assessing the effect of Federal preemption of State and local taxes and 
fees in connection with DoD health services contracts, interpretations 
shall be consistent with those applicable to the Federal Employees 
Health Benefits Program under 5 U.S.C. 8909(f).
    G. Administration (paragraph 199.24(g)). This paragraph provides 
that the ASD(HA) may establish other rules and procedures necessary for 
the effective administration of TRICARE Reserve Select.

III. Provisions of the Rule Regarding the Transitional Assistance 
Management Program

    A. Eligibility under the Transitional Assistance Management Program 
(TAMP) (paragraph 199.3(e)). Section 706 of NDAA-05 makes permanent 
revisions to the Transitional Assistance Management Program, which was 
temporarily revised by section 704 of NDAA-04 and section 1117 of the 
Emergency Supplemental. Based on these enactments, several categories 
of armed forces members are eligible for transitional health care after 
serving on active duty. These include:
    1. A member who is involuntarily separated from active duty;
    2. A member of a reserve component who is separated from active 
duty to which called or ordered in support of a contingency operation 
if the active duty is active duty for a period of more than 30 
consecutive days;
    3. A member who is separated from active duty for which the member 
is involuntarily retained under 10 U.S.C. 12305 in support of a 
contingency operation; or
    4. A member who is separated from active duty served pursuant to a 
voluntary agreement of the member to remain on active duty for a period 
of less than one year in support of a contingency operation.
    (2) A spouse (as described in paragraph (b)(2)(i) of this section 
except for former spouses) and child (as described in paragraph 
(b)(2)(ii) of this section) of a member described in paragraph (e)(1) 
of this section is also eligible for TAMP benefits under TRICARE.
    The spouse and children of the member are also eligible for TAMP 
benefits. TAMP benefits begin the day after the member is separated 
from active duty, and end 180 days later. Eligibility is determined by 
the armed forces.
    B. Beneficiary liability under TAMP. (paragraph 199.4(f)(2)(vi)). 
This paragraph establishes that TAMP beneficiaries (including the 
member) are subject to the TRICARE Standard deductible and cost sharing 
rules applicable to active duty family members.

IV. Provisions of the Rule Regarding Early Eligibility for Tricare for 
Certain Reserve Component Members

    A. Eligibility (paragraph 199.3(b)(5)). This paragraph incorporates 
requirements and procedures for implementation of the earlier temporary 
TRICARE eligibility for certain reserve component members authorized by 
section 703 of NDAA-04 and section 1116 of the Emergency Supplemental, 
which provisions were made permanent by section 703 of NDAA-05. Under 
this paragraph reserve component members issued delayed-effective-date 
orders for service in support of a contingency operation, and their 
family members, are eligible for TRICARE on the date the orders are 
issued, up to 90 days prior to the date on which the period of active 
duty of more than 30 consecutive days is to begin.

V. Regulatory Procedures

    Executive Order 12866 requires certain regulatory assessments for 
any significant regulatory action that would result in an annual effect 
on the economy of $100 million or more, or have other substantial 
impacts. The Congressional Review Act establishes certain procedures 
for major rules, defined as those with similar major impacts. The 
Regulatory Flexibility Act (RFA) requires that each Federal agency 
prepare, and make available for public comment, a regulatory 
flexibility analysis when the agency issues a regulation that would 
have significant impact on a substantial number of small entities. This 
interim final rule is not subject to any of those requirements because 
it would not have any of these substantial impacts. Any substantial 
impacts associated with implementation of TRICARE Reserve Select are 
already determined by statute and are outside any discretionary action 
of DoD or effect of this regulation.
    This rule, however, does address novel policy issues relating to 
implementation of a new medical benefits program for members of the 
armed forces. Thus, this rule has been reviewed by the Office of 
Management and Budget under E.O. 12866.
    This rule will not impose additional information collection 
requirements on the public under the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501-

[[Page 12802]]

3511). Information needed for TRICARE Reserve Select is obtained from 
active duty military service records.
    This rule is being issued as an interim final rule, with comment 
period, as an exception to our standard practice of soliciting public 
comments prior to issuance. This is because Congress has established an 
April 26, 2005 effective date for eligible members' entitlement to 
TRICARE Reserve Select. The 180-day TAMP coverage period and the 
delayed effect date orders pre-mobilization eligibility period 
entitlements became effective on the date of enactment. This rule 
changes the regulation to conform to the statutory entitlement. Based 
on these statutory requirements, the ASD(HA) has determined that 
following the standard practice in this case would be unnecessary, 
impractical, and contrary to the public interest.
    Public comments are invited. All comments will be carefully 
considered. A discussion of the major issues received by public 
comments will be included with the issuance of the final rule.

List of Subjects in 32 CFR Part 199

    Claims, handicapped, health insurance, and military personnel.


0
Accordingly, 32 CFR part 199 is amended as follows:

PART 199--[AMENDED]

0
1. The authority citation for part 199 continues to read as follows:

    Authority: 5 U.S.C. 301; 10 U.S.C. chapter 55.


0
2. Section 199.2(b) is amended by adding the following two definitions 
and placing them in alphabetical order to read as follows:


Sec.  199.2  Definitions.

* * * * *
    (b) * * *
    Transitional Assistance Management Program (TAMP). The program 
established under 10 U.S.C. Sec.  1145(a) and Sec. 199.3(e) of this 
part.
* * * * *
    TRICARE Reserve Select. The program established under 10 U.S.C. 
Sec.  1076d and Sec.  199.24 of this part.
* * * * *

0
3. Section 199.3 is amended by adding new paragraph (b)(5) and revising 
paragraph (e) to read as follows:


Sec.  199.3  Eligibility.

* * * * *
    (b) * * *
    (5) Reserve Component Members Issued Delayed-Effective-Date Orders.
    (i) Member. A member of a reserve component of the armed forces who 
is ordered to active duty for a period of more than 30 consecutive days 
in support of a contingency operation under a provision of law referred 
to in section 101(a)(13)(B) of Title 10, United States Code, that 
provides for active-duty service to begin on a date after the date of 
the issuance of the order.
    (ii) Dependents. CHAMPUS eligible dependents under this paragraph 
(b)(5) are those identified in paragraphs (b)(2)(i) (except former 
spouses) and (b)(2)(ii) of this section.
    (iii) Effective date. The eligibility established by paragraphs 
(b)(5)(i) and (ii) of this section shall begin on or after November 6, 
2003, and shall be effective on the later of the date that is:
    (A) The date of issuance of the order referred to in paragraph 
(b)(5)(i) of this section; or
    (B) 90 days before the date on which the period of active duty is 
to begin.
    (iv) Termination date. The eligibility established by paragraphs 
(b)(5)(i) and (ii) of this section ends upon entry of the member onto 
active duty (at which time CHAMPUS eligibility for the dependents of 
the member is established under paragraph (b)(2) of this section) or 
upon cancellation or amendment of the orders referred to in paragraph 
(b)(5)(i) of this section such that they no longer meet the 
requirements of that paragraph (b)(5)(i).
* * * * *
    (e) Eligibility under the Transitional Assistance Management 
Program (TAMP).
    (1) A member of the armed forces is eligible for transitional 
health care if the member is:
    (i) A member who is involuntarily separated from active duty.
    (ii) A member of a Reserve component who is separated from active 
duty to which called or ordered in support of a contingency operation 
if the active duty is active duty for a period of more than 30 
consecutive days.
    (iii) A member who is separated from active duty for which the 
member is involuntarily retained under 10 U.S.C. 12305 in support of a 
contingency operation; or
    (iv) A member who is separated from active duty served pursuant to 
a voluntary agreement of the member to remain on active duty for a 
period of less than 1 year in support of a contingency operation.
    (2) A spouse (as described in paragraph (b)(2)(i) of this section 
except former spouses) and child (as described in paragraph (b)(2)(ii) 
of this section) of a member described in paragraph (e)(1) of this 
section is also eligible for TAMP benefits under TRICARE.
    (3) TAMP benefits under TRICARE begin on the day after the member 
is separated from active duty, and, if such separation occurred on or 
after November 6, 2003, and end 180 days after such date. TRICARE 
benefits available to both the member and eligible family members are 
generally those available to family members of members of the uniformed 
services under this Part. Each branch of service will determine 
eligibility for its members and eligible family members and provide 
data to DEERS.
* * * * *

0
4. Section 199.4 is amended by adding new paragraph (f)(2)(vi) to read 
as follows:


Sec.  199.4  Basic program benefits.

* * * * *
    (f) * * *
    (2) * * *
    (vi) Transitional Assistance Management Program (TAMP). Members of 
the Armed Forces (and their family members) who are eligible for TAMP 
under paragraph 199.3(e) of this Part are subject to the same 
beneficiary or sponsor liability as family members of members of the 
uniformed services described in this paragraph (f)(2).
* * * * *

0
5. Section 199.24 is added to read as follows:


Sec.  199.24  TRICARE standard coverage for certain selected reserve 
members.

    (a) Establishment. TRICARE Reserve Select is established for the 
purpose of offering TRICARE health benefits to eligible members of the 
Selected Reserve and their immediate family.
    (1) Purpose. TRICARE Reserve Select is a premium-based medical 
coverage program that will be available to certain members of the 
Selected Reserve and their immediate family as specified in paragraph 
(b) of this section.
    (2) Statutory Authority. TRICARE Reserve Select is authorized by 10 
U.S.C. 1076d.
    (3) Scope of the Program. TRICARE Reserve Select is applicable in 
the 50 United States, the District of Columbia, Puerto Rico, and, to 
the extent practicable, other areas where members of the Selected 
Reserve serve. In locations other than the 50 states of the United 
States and the District of Columbia, the Assistant Secretary of Defense 
may authorize modifications to the program rules and procedures as may 
be appropriate to the area involved.
    (4) Major Features of TRICARE Reserve Select. The major features of 
the program include the following:
    (i) TRICARE rules applicable. (A) Unless specified in this section 
or

[[Page 12803]]

otherwise prescribed by the Assistant Secretary of Defense (Health 
Affairs) (ASD(HA)), provisions of 32 CFR Part 199 apply to TRICARE 
Reserve Select.
    (B) Certain special programs established in 32 CFR Part 199 are not 
available to enrollees in TRICARE Reserve Select. These include the 
Supplemental Health Care Program (see Sec.  199.16), the Extended 
Health Care Option Program (see Sec.  199.5), and the Special 
Supplemental Food Program (see Sec.  199.23). The TRICARE Dental 
Program (see Sec.  199.13) is independent of this program and is 
otherwise available to all members of the Selected Reserve and their 
dependents whether or not they are enrolled in TRICARE Reserve Select.
    (ii) Enrollment system. Under TRICARE Reserve Select, eligible 
Reserve component members may enroll for self-only or self and family 
coverage. Rules and procedures for enrollment and payment of applicable 
premiums are prescribed in this section. When their enrollment becomes 
effective TRICARE Reserve Select beneficiaries receive the TRICARE 
Standard benefit, as described in Sec.  199.17.
    (iii) Benefits. Eligible persons may be enrolled in TRICARE Reserve 
Select, which features the deductible and cost share provisions of the 
TRICARE Standard plan for active duty family members for both the 
member and the member's dependents. The TRICARE Standard plan is 
described in Sec.  199.17.
    (b) Eligibility for enrollment in TRICARE Reserve Select. (1) 
Eligibility. Individuals are eligible for enrollment in TRICARE Reserve 
Select who meet the eligibility criteria defined in paragraphs 
(b)(1)(i), (b)(1)(ii), or (b)(1)(iii) of this section.
    (i) Members released from active duty after April 26, 2005. A 
member released from active duty after April 26, 2005 that is a member 
of a Reserve component of the Armed Forces is eligible for TRICARE 
Reserve Select if the member:
    (A) Is called or ordered to active duty for a period of more than 
30 days on or after September 11, 2001 under a provision of law 
referred to in 10 U.S.C. 101(a)(13)(B).
    (B) Serves continuously on active duty for 90 days or more pursuant 
to such call or order to active duty (unless such continuous service on 
active duty is less than 90 days solely due to an injury, illness, or 
disease incurred or aggravated while deployed, as provided in 10 U.S.C. 
1076d(b(2)(A));.
    (C) Is released from active duty after April 26, 2005.
    (D) On or before the date of release from active duty, agrees to 
serve continuously in the Selected Reserve for a period of 1 or more 
years upon release from active duty; and
    (E) Meets the qualifications for continued membership in the 
Selected Reserve as determined by the member's Reserve component.
    (ii) Members released from active duty on or before April 26, 2005. 
A member or former member of a Reserve component of the Armed Forces 
who was released from active duty on or before April 26, 2005 is 
eligible for TRICARE Reserve Select if the member:
    (A) Was called or ordered to active duty for a period of more than 
30 days on or after September 11, 2001 under a provision of law 
referred to in 10 U.S.C. 101(a)(13)(B).
    (B) Served continuously on active duty for 90 days or more pursuant 
to such call or order to active duty (unless such continuous service on 
active duty is less than 90 days solely due to an injury, illness, or 
disease incurred or aggravated while deployed, as provided in 10 U.S.C. 
1076d(b(2)(A)).
    (C) Was released from active duty on or before April 26, 2005.
    (D) Prior to enrollment in TRICARE Reserve Select, signs an 
agreement no later than October 28, 2005 to serve continuously in the 
Selected Reserved for a period of 1 or more years; and
    (E) Meets the qualifications for continued membership in the 
Selected Reserve as determined by the member's Reserve component.
    (iii) Immediate family of reserve members. While an eligible member 
of a Reserve component is enrolled in TRICARE Reserve Select, 
dependents of such member, as defined in paragraphs (b)(2)(i) (except 
former spouses) and (b)(2)(ii) of this section are eligible to be 
enrolled for the same period as the member.
    (2) Additional procedures applicable to eligibility. The Reserve 
components are responsible for determining members' duty status, 
periods of obligation, and other military personnel matters that are 
pertinent to establishing eligibility for TRICARE Reserve Select.
    (c) TRICARE Reserve Select enrollment procedures. (1) Enrollment 
required. In order to be covered under TRICARE Reserve Select, eligible 
Reserve component members must complete and submit the applicable 
TRICARE enrollment form, and an initial premium required by paragraph 
(d) of this section. Enrollment is accomplished by submission of an 
application to the appropriate TRICARE Contractor in accordance with 
procedures established by the ASD(HA).
    (2) Election of type of coverage. A member of a Reserve component 
who is eligible for enrollment under paragraph (b) of this section may 
elect self-only or self and family coverage. Family members who may be 
included in such family coverage are dependents referred to in 
paragraph (b)(1)(iii) of this section.
    (3) Period of coverage. Except eligible members released from 
active duty on or before April 26, 2005, a member must before being 
released from active duty enter into an agreement to serve continuously 
in the Selected Reserve, and the member must meet the qualifications 
for continued service in the Selected Reserve as determined by the 
member's Reserve component. The member must then enroll in TRICARE 
Reserve Select prior to 30 days before the expiration of Transition 
Assistance Management Program (TAMP) benefits under Sec.  199.3(e) of 
this part.
    (i) Except members released from active duty on or before April 26, 
2005, coverage begins at the expiration of TAMP benefits under Sec.  
199.3(e) of this part and runs continuously until eligibility expires 
or is otherwise terminated, or the member is disenrolled. (See 
paragraphs (c)(4)(i), (5), or (6) of this section.) When enrollment is 
terminated, a member may not re-enroll unless recalled to active duty 
and the member re-qualifies for a new period of benefits under 
paragraph (b) of this section.
    (ii) For members released from active duty on or before April 26, 
2005, coverage begins on the date that is the later of the expiration 
of TAMP benefits under Sec.  199.3(e) or the effective date of the 
member's agreement referred to in paragraph (b)(1)(ii)(D) of this 
section.
    (iii) When a member enrolled in TRICARE Reserve Select is recalled 
to active duty for a period of more than 30 days TRICARE Reserve Select 
coverage is superseded by active duty military medical benefits for the 
member and for any family member enrolled in TRICARE Reserve Select, 
but the coverage period continues to run. When the member is released 
from active duty, TRICARE Reserve Select coverage will resume for the 
member (and the member's family members provided the member had been 
enrolled in self and family coverage on the date TRICARE Reserve Select 
coverage was superseded by active duty health benefits). TRICARE 
Reserve Select coverage will continue until the member's eligibility 
expires or is otherwise terminated, or the member is disenrolled. (See 
paragraphs (c)(4)(i), (5), or (6) of this section.) Following the 
member's release from active duty, TRICARE Reserve Select coverage will 
also be superseded by TAMP benefits under Sec.  199.3(e) of this Part, 
if applicable. In

[[Page 12804]]

addition, TRICARE Reserve Select coverage is also superseded, if 
applicable, by any period of early TRICARE coverage based on delayed 
effective date orders under Sec.  199.3(b)(5) of this Part or by a new 
enrollment, as a result of re-qualifying through another period of 
active duty service in support of a contingency operation under Sec.  
199.24(c) of this Part. During any period in which TRICARE Reserve 
Select coverage is superseded, no premium payments for TRICARE Reserve 
Select are due.
    (iv) Members who are eligible for TRICARE Reserve Select under 
paragraph (b) of this section may enroll for one year of TRICARE 
Reserve Select coverage for every 90 days of continuous active-duty 
service, subject to the limitation in paragraph (c)(3)(v) of this 
section. If such continuous service on active duty is less than 90 days 
solely due to an injury, illness, or disease incurred or aggravated 
while deployed, then the otherwise eligible member may enroll for one 
year of TRICARE Reserve Select coverage, as provided in 10 U.S.C. 
1076d(b(2)(A).
    (v) The number of years for which the member and family are 
eligible under paragraph (c)(3)(iv) of this section may not exceed the 
number of whole years for which the member agrees to continue service 
in the Selected Reserves before coverage begins, per the service 
agreement entered into under paragraph (b)(1) of this section. The 
number of years established by the member's agreement that was entered 
into prior to beginning coverage under TRICARE Reserve Select may not 
later be changed, even if that number of years was fewer than the 
maximum number of years that the member could have established in the 
agreement. The number of years of coverage may only be changed if the 
member is recalled to active duty and the member re-qualifies for a new 
period of benefits under paragraph (b) of this section.
    (vi) When a member's eligibility is terminated or the member is 
disenrolled from TRICARE Reserve Select under paragraphs (c)(4)(i), 
(5), or (6) of this section, the member may not re-enroll unless 
recalled to active duty and the member re-qualifies for a new period of 
benefits under paragraph (b) of this section.
    (4) Changes to type of coverage. Under certain circumstances, 
reserve members may change their TRICARE Reserve Select type of 
coverage.
    (i) Disenrollment. Reserve members may disenroll from the program 
at any time by notifying the appropriate TRICARE office. Disenrollment 
of the member will result in automatic disenrollment of the member's 
family members in TRICARE Reserve Select.
    (ii) Change from self and family type of coverage to self-only type 
of coverage. After initial enrollment, sponsors may change type of 
coverage from self and family to self-only only when an event occurs 
that changes the composition of the family, such as divorce, legal 
separation, or death of a family member, or changes in family 
employment or health coverage status. The change will become effective 
in accordance with procedures established by the ASD(HA).
    (iii) Change from self-only type of coverage to self and family 
type of coverage. After initial enrollment, the reserve member may 
change type of coverage from self-only to self and family only when an 
event occurs that changes the composition of the family, such as the 
birth of a child, marriage of the sponsor, legal adoption of a child, 
or placement by a court of a child as a legal ward in the sponsor's 
home, or certain events affecting family health coverage, such as an 
employment change. The change will become effective in accordance with 
procedures established by the ASD(HA).
    (5) Effect of failure to pay applicable premiums. Failure by 
enrollees to make a premium payment as required in a timely manner will 
result in automatic disenrollment from TRICARE Reserve Select and 
denial of payment of claims for services provided on or after the first 
day of the month for which the premium payment was not paid. 
Beneficiaries disenrolled due to lack of premium payments will not be 
allowed to re-enroll, absent the member acquiring a new period of 
eligibility based upon qualifying active duty service after the date of 
disenrollment. Disenrollment of the member for failure to pay 
applicable premiums will also result in automatic disenrollment of the 
member and the member's family members from TRICARE Reserve Select.
    (6) Ineligibility. A reserve member who ceases to be eligible for 
TRICARE Reserve Select as specified in paragraph (b) of this section or 
whose eligibility is terminated based on termination of the member's 
service in the Selected Reserve shall be disenrolled and shall no 
longer be eligible. Disenrollment of the member due to ineligibility 
will result in automatic disenrollment of the member's family members 
in TRICARE Reserve Select.
    (7) Effective date of disenrollment. Disenrollments become 
effective:
    (i) In the case of disenrollment due to ineligibility (other than 
relating to the death of a member), on the date of ineligibility.
    (ii) In the case of disenrollment due to nonpayment of premiums, at 
the end of the last month for which premiums were paid.
    (iii) In all other cases, at the end of the month in which the 
event causing disenrollment occurred.
    (8) Periodic revision. Periodically, certain features, rules or 
procedures of TRICARE Reserve Select may be revised. If such revisions 
will have a significant effect on participants' costs or access to 
care, beneficiaries may be given the opportunity to change their 
enrollment status coincident with the revisions.
    (d) TRICARE Reserve Select premiums. Premiums shall be charged for 
coverage under TRICARE Reserve Select. Premiums are to be paid monthly, 
except as otherwise provided through administrative implementation, 
pursuant to procedures established by the ASD(HA).
    (1) Establishment of rates. (i) TRICARE Reserve Select monthly 
premium rates are established annually on a calendar year basis by the 
ASD(HA) for the two types of coverage--self-only and self and family. 
The annual rates are based on 28 percent of the total estimated amount 
(rounded to the nearest dollar) reasonable for health care coverage for 
the TRICARE Reserve Select eligible population under the TRICARE 
Standard benefit, as determined by the ASD(HA) on an appropriate 
actuarial basis. The monthly rate for each month of a calendar year is 
one-twelfth of the annual rate for that calendar year, rounded to the 
nearest dollar.
    (ii) Initial annual rates are based on the annual premiums for the 
Blue Cross and Blue Shield Standard Service Benefit Plan under the 
Federal Employees Health Benefits Program, a nationwide plan closely 
resembling TRICARE Standard coverage, with an adjustment based on 
estimated differences in covered populations, as determined by the 
ASD(HA).
    (2) Premium adjustments. In addition to the determinations 
described in paragraph (d)(1) of this section, premium adjustments may 
be made prospectively for any calendar year to reflect any significant 
program changes or any actual experience in the costs of administering 
the TRICARE Reserve Select Program.
    (3) Premium rates for calendar year 2005. (i) For calendar year 
2005, the annual premium for self-only coverage under TRICARE Reserve 
Select is $900.
    (ii) For calendar year 2005, the annual premium for self and family 
coverage under TRICARE Reserve Select is $2,796.

[[Page 12805]]

    (e) Relationship to Continued Health Care Benefits Program. If at 
the time a member enrolls in TRICARE Reserve Select, or resumes TRICARE 
Reserve Select coverage after a period in which coverage was superseded 
under paragraph (c)(3)(iii) of this section, the member was also 
eligible to enroll in the Continued Health Care Benefits Program 
(CHCBP) under Sec.  199.20(d)(1)(i) of this part (except to the extent 
eligibility in CHCBP was affected by enrollment in TRICARE Reserve 
Select), enrollment in TRICARE Reserve Select will be deemed to also 
constitute preliminary enrollment in CHCBP. If for any reason the 
member becomes disenrolled from TRICARE Reserve Select before the date 
that is 18 months after discharge or release from the most recent 
period of active duty upon which CHCBP eligibility was based, the 
member or the member's family members eligible to be included in CHCBP 
coverage may, within 30 days of the effective date of the 
disenrollment, begin CHCBP coverage by paying the applicable premium. 
The period of coverage will be as provided in Sec.  199.20(d)(6) of 
this part.
    (f) Preemption of State laws. (1) Pursuant to 10 U.S.C. 1103, the 
Department of Defense has determined that in the administration of 
chapter 55 of title 10, U.S. Code, preemption of State and local laws 
relating to health insurance, prepaid health plans, or other health 
care delivery or financing methods is necessary to achieve important 
Federal interests, including but not limited to the assurance of 
uniform national health programs for military families and the 
operation of such programs at the lowest possible cost to the 
Department of Defense, that have a direct and substantial effect on the 
conduct of military affairs and national security policy of the United 
States. This determination is applicable to contracts that implement 
this section.
    (2) Based on the determination set forth in paragraph (e)(1) of 
this section, any State or local law or regulation pertaining to health 
insurance, prepaid health plans, or other health care delivery, 
administration, and financing methods is preempted and does not apply 
in connection with TRICARE Reserve Select. Any such law, or regulation 
pursuant to such law, is without any force or effect, and State or 
local governments have no legal authority to enforce them in relation 
to TRICARE Reserve Select. (However, the Department of Defense may, by 
contract, establish legal obligations on the part of DoD contractors to 
conform with requirements similar to or identical to requirements of 
State or local laws or regulations with respect to TRICARE Reserve 
Select.)
    (3) The preemption of State and local laws set forth in paragraph 
(e)(2) of this section includes State and local laws imposing premium 
taxes on health insurance carriers or underwriters or other plan 
managers, or similar taxes on such entities. Such laws are laws 
relating to health insurance, prepaid health plans, or other health 
care delivery or financing methods, within the meaning of 10 U.S.C. 
1103. Preemption, however, does not apply to taxes, fees, or other 
payments on net income or profit realized by such entities in the 
conduct of business relating to DoD health services contracts, if those 
taxes, fees or other payments are applicable to a broad range of 
business activity. For the purposes of assessing the effect of Federal 
preemption of State and local taxes and fees in connection with DoD 
health services contracts, interpretations shall be consistent with 
those applicable to the Federal Employees Health Benefits Program under 
5 U.S.C. 8909(f).
    (g) Administration. The ASD(HA) may establish other rules and 
procedures for the effective administration of TRICARE Reserve Select, 
and may authorize exceptions to requirements of this section, if 
permitted by law, based on extraordinary circumstances.

    Dated: March 11, 2005.
Jeannette Owings-Ballard,
OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 05-5219 Filed 3-15-05; 8:45 am]
BILLING CODE 5001-06-P