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There is a lot to think about for yourself and your family as you prepare to leave the military. The most important of these is health insurance.

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It’s an abrupt shift for many exiting service members. That’s because health care is free under TRICARE, the military’s health insurance program for active-duty personnel and their families. “If you become sick or wounded, you go to the doctor on post, and TRICARE covers your health care,” explains Sean Scaturro, USAA Advice Director. “Words like deductible, co-pay, and premium are probably meaningless to you.”

Understanding these phrases as a citizen might make or break your budget. It’s crucial to start transition planning about two years before you retire or split.

How to Consider Post-Military Health Insurance

The cost of insurance can be shocking if you’ve never had to budget for health care. According to Federal Reserve study, 35% of Americans would be unable to cover a $400 unexpected bill without incurring debt.

If this describes you, go ahead and include a health-care line item in your budget. Don’t put off starting your transition until it’s finished, says Scaturro. “As military members prepare to transition into civilian life, I encourage that they start saving for contingencies now, including money to help pay for health care.”

Scaturro remembers a recent trip to his local urgent care center with his son following an ear injury. “My son did not require any gauze, sutures, liquid stitches, or anything else. We spent $300 only to see the doctor “he claims. “If Americans can’t afford an unexpected $400 bill, they’ll struggle to pay their doctor’s office co-pays and health-care deductibles.”

Before you start looking for health insurance, consider the following three questions:

What are my health-care requirements? A single individual in good health, for example, has different needs than a married person with small children. Children typically require more regular medical attention, although a young adult may visit the doctor less frequently. Consider any pre-existing medical issues that may be covered by VA disability.

Which health-care plan am I eligible for? Each health care plan has its own set of standards. Examining all of the choices for which you are eligible allows you to make an informed decision.

Which health-care plan is the most cost-effective? Weigh plan pricing and compare deductibles and upfront fees. Scaturro cautions against making a decision only based on price. Instead, start by assessing your requirements and ensuring that the plan you select provides adequate coverage.

What about Veterans Health Administration (VHA) or VA benefits?

You may be able to obtain medical services through the Veterans Health Administration (VA). The VA does not provide insurance. When it comes to planning, consider how receiving care from the VA can benefit your financial condition.

The VA medical system prioritizes care based on a variety of factors, including your military service history, disability rating, and income level. If you have a service-related disability that necessitates continuing treatment, you should consider receiving it from the VA. It could be free or less expensive than going to a non-VA doctor or facility.

Receiving care from the VA does not limit you to only seeing their doctors. Keep in mind that if you seek treatment from a non-VA doctor, you will almost certainly be using your health insurance and will need to budget for those charges.

Understanding the terminology for post-military health insurance expenses. As you learn new health-care terminology, become acquainted with the following terms, which all describe charges that you will be responsible for.


This is the amount you will pay each month for your insurance.

Deductibles are the amounts you must pay before your insurance coverage kicks in. After you’ve paid your deductible, your insurance kicks in. Assume you have a $2,000 deductible and need a $10,000 treatment. You would be liable for $2,000, while insurance would cover the remaining $8,000. After you’ve met your deductible, you normally simply have to pay for co-insurance or co-pays.

Copayments and coinsurance:

These charges are paid at the point of service, such as a $20 co-pay for a doctor’s appointment.

Maximum out-of-pocket expense: Aside from your premiums and any undisclosed charges, this is the most you’ll pay in a single insurance year.

Why does retiring vs. separating matter?

If you leave the military, you will not be eligible for TRICARE. As a civilian, you will be able to purchase health care. Read our article How to Get Health Insurance: 5 Steps for Shopping for the Right Coverage for You for additional information on how to get started.

You will be eligible for TRICARE if you retire. “The advice is quite straightforward,” Scaturro explains. “Enroll in TRICARE if you have access to physicians who accept it.” Why? Expenses are low, as are premiums and deductibles.

TRICARE should be accepted by any provider who accepts Medicare. Check with any providers you intend to see to ensure they accept it. There may be fewer doctors in rural places. It is possible that you will have to travel some distance to see a doctor that accepts TRICARE.

If there are no TRICARE providers in your area and you do not want to travel, you must obtain health insurance through your employer, the government healthcare.gov marketplace, or a commercial exchange such as USAA.

When your military health insurance expires, you and your family will have some temporary options. TRICARE provides many short-term health plans, including:

Program of Continuing Health Care Benefits (CHCBP). When you lose TRICARE, the CHCBP is a premium-based plan that provides coverage for 18 to 36 months.

Option for Extended Health Care (ECHO). ECHO provides assistance to qualifying beneficiaries with special needs.

Program for Transitional Assistance Management (TAMP). TAMP provides transitional health care benefits following the termination of regular TRICARE insurance.

Most crucial, begin planning for your post-military health insurance as soon as possible. Meet with the skilled personnel at your post or base who can assist you with the transfer. They are great resources who can assist you in making the best option for your specific circumstances.

Employer-sponsored health insurance

Approximately half of all Americans obtain their health insurance through their employment. When searching for jobs as a civilian, keep in mind that not all employer-provided health care plans are the same. Make sure to inquire about health care benefits during the interview process. Keep that information in mind as you make your final selection on where you wish to work.

Assume “Employer A” offers a higher wage than “Employer B.” In addition, “Employer B” has a health insurance plan with a lower deductible that covers more medical care expenditures. “When all financial aspects are considered, the best employer isn’t that clear,” Scaturro explains.

Other plans, such as disability, dental, and vision insurance, may be provided by your employer. Think on your entire perks and how they affect your take-home pay.

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