MIL-OSI USA: Congressman Castro Fights to Relieve Medical Debt for BAMC Patients through Fiscal Year 2025 NDAA

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Source: United States House of Representatives – Congressman Joaquin Castro (20th District of Texas)

June 11, 2024

WASHINGTON This week, U.S. House lawmakers will consider two amendments authored by Congressman Joaquin Castro (TX-20) that would address ongoing issues with medical debt and financial hardship associated with civilian care at Brooke Army Medical Center (BAMC) in San Antonio. If made in order by the House Rules Committee, the amendments will be included in the Fiscal Year 2025 National Defense Authorization Act (NDAA).

“For years, BAMC’s agreement with Bexar County has allowed Army medical providers to practice their battlefield trauma skills by treating critically injured patients in South Texas,” said Congressman Castro. “Our region is proud to be home to the Army’s premier training hospital, but that training should not come at the expense of patients and their families. I’ve been glad to make progress on BAMC’s billing issues over the last several NDAA cycles and I’m disappointed that families are still dealing with medical debt after treatment at BAMC and other DOD facilities. I strongly urge the House Rules Committee to include my amendments in this year’s defense bill and provide the relief that trauma patients deserve.”

Details on the Submitted Amendments

Amendment 643, a bipartisan amendment authored by Congressman Castro and co-sponsored by Congressman Greg Casar (TX-35) and Congressman Tony Gonzales (TX-23), would exclude medical debt waived by the DOD from being considered taxable income by the IRS. Under current regulations, medical debt forgiven by the DOD can be considered taxable income, creating severe financial burdens for patients struggling to recover from trauma.

Amendment 652, a bipartisan amendment authored by Congressman Castro and co-sponsored by Congressman Casar and Congressman Gonzales, would pause the collection of all medical bills incurred by civilians who receive treatment at BAMC or other military medical treatment facilities (MTFs).

Amendment Background: In June 2023, the Department of Defense (DOD) issued a memo directing the Defense Health Agency (DHA) to pause collection of medical bills incurred by civilians treated at MTFs from June 2023 onward. The memo was intended as an interim measure while the DOD implemented Section 716 of the FY 2023 NDAA. Section 716, a Castro-authored amendment, requires the DHA to provide financial relief options for civilians who face financial hardship due to the cost of treatment at BAMC.

If approved, Amendment 652 would require the DOD to pause collection of all medical payments from civilians who receive treatment at MTFs, including patients treated before June 2023. The amendment would remain in effect until Section 716 is implemented. Under Amendment 652, the DOD could continue to collect payments from insurance companies and third-party payers.

Issue Background:

BAMC is one of two Level I Trauma Centers in San Antonio. Every year, the facility treats thousands of civilians under a special agreement with the Bexar County Hospital District designed to allow military providers to practice battlefield medical skills through hands-on trauma care. However, prior to a 2020 Castro amendment to the FY 2021 NDAA, BAMC and other MTFs were not authorized to waive medical debt for indigent or uninsured patients. As a result, many civilians faced five-, six– and seven-figure medical bills after treatment at BAMC. Additionally — despite treating thousands of civilians each year — BAMC’s payment systems have not been optimized to work with civilian insurance payees, causing payment delays that have needlessly pushed some medical bills into arrears.

In response to these concerns, Congressman Castro and Senator Elizabeth Warren authored an amendment (Section 702) to the FY 2021 NDAA to provide the DOD with the authority to waive civilian medical bills incurred at MTFs. In 2022, Congressman Castro also secured an additional amendment (Section 716) to the FY 2023 NDAA requiring the Defense Health Agency to implement a modified payment plan based on a sliding-scale discount program for civilian patients who are underinsured or at risk of financial harm from the costs associated with their treatment at an MTF. Amendments 652 and 643 would build on the progress established in the FY 2021 and FY 2023 NDAA.

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