The MHS Modified Payment and Waiver Program is a new program to prevent financial harm to civilian non-beneficiaries who received care at a military hospital or clinic on or after June 21, 2023.

Although most of the care provided to civilians is emergency care, other typical circumstances for civilian treatment at military hospitals and clinics include space-available care in certain specialties, and specific agreements with local communities. Care isn't limited to ambulance arrivals.

Military hospitals and clinics provide care to civilians for medical readiness reasons and only when space and capability exist without adversely impacting our beneficiary population. Rendering care enhances the skills of military health care providers.

Not all military hospitals and clinics provide emergency care to civilians. Capabilities vary based on facility size, location, and mission.

More than 20,000 civilians are treated annually at military hospitals and clinics for emergency and trauma care. Federal civilian employees—particularly at overseas military installations, are also provided care at MTFs on a space available basis.

Civilians who aren't beneficiaries of the MHS are generally charged for treatment received at military hospitals and clinics. Billing processes are similar to those at private sector civilian hospitals. For patients with insurance, the facility will submit a claim to the individual’s health insurer. If the patient’s Explanation of Benefits indicates that the patient is responsible for any portion of the bill, the facility will submit an invoice to the patient. For uninsured patients, the facility will mail a medical bill to the patient.

Patients may apply to the MHS Modified Payment and Waiver Program if they require financial relief. This includes:

• Insured patients who need assistance paying their portion of the bill (post-insurance payment)
• Uninsured patients
• Federal employees who receive care at military hospitals and clinics

Civilians without insurance or who are unable to pay may apply to the MHS Modified Payment and Waiver Program if their care occurred on or after June 21, 2023. In some cases, under the program a bill may be reduced to zero or substantially discounted based on the patient’s income, or it may be waived if the DHA Director determines that the provision of care enhanced the knowledge, skills, and abilities of military health care providers.

For care received prior to that date, patients can work with the DHA Debt Adjudication Office or the Department of the Treasury's Cross-Servicing Program to discuss other available options for financial relief.

While specific collection rate percentages are not publicly released, the Federal Claims Collection Standards mandate that federal agencies aggressively collect all debts. The very creation of the MHS Modified Payment and Waiver Program by Congress was in response to the "substantial medical bills" and "financial harm" this aggressive collection caused for some civilian patients. This program is designed to create a more compassionate and successful resolution process.

The Defense Health Agency has 606 clinics and 45 hospitals worldwide*. Over 40 provide emergency services.

Source: Fiscal Year 2024 TRICARE Program Evaluation Report 

A trauma center designation is a classification system for hospitals based on their ability to provide comprehensive emergency care for severely injured patients. There are five levels. Level I is the highest.

The DHA has 14 designated trauma centers. These centers have specialized staff, resources, and protocols to provide immediate, comprehensive care. Studies have shown these resources can significantly improve survival rates for severely injured patients.

This question addresses two fundamentally different situations. TRICARE is a health insurance benefit with established premiums and cost-shares that beneficiaries are aware of.

The MHS Modified Payment and Waiver Program, is a financial hardship safety net for civilian non-beneficiaries who aren't part of the TRICARE system and are often billed the full, unsubsidized cost of care, which can be financially catastrophic. The program's stratified fees were specifically designed to be equitable with what military retirees pay for comparable services in the private sector.

No. Military hospitals and clinics aren't open to the general public for routine care, nor is the health care free. Individuals will be billed by the medical facility. The care provided to civilians occurs under specific, pre-existing legal authorities, primarily for life-threatening emergencies or when it directly supports the readiness training of our medical personnel.

This program doesn't change who's treated. This program only provides a mechanism for financial relief after care has already been provided.

The care provided to our TRICARE beneficiaries is and will remain our top priority. TRICARE funding isn't affected by this program. This program doesn't represent a new cost or expenditure, but rather a change in how we handle uncollected revenue.

Congress has determined that the readiness value of providing this care, combined with the public good of preventing catastrophic financial harm, outweighs the monetary value of pursuing debts from individuals who can't pay. This program aligns our billing practices with that congressional mandate.

Civilian non-beneficiaries (including civilian federal employees) with a household income at or below 600% of the Federal Poverty Guidelines who have an outstanding medical debt from a military hospital or clinic for health care services received on or after June 21, 2023.

For patients with health insurance, the DOW will bill your insurance company first and accept their payment as prescribed by your plan's Explanation of Benefits. You'll only be billed for your remaining responsibility, such as copays, deductibles, and non-covered services. You can then apply to the MHS Modified Payment and Waiver Program to have that remaining balance reduced based on your income.

The law doesn't allow this program to be applied retroactively. For debts incurred before this date, you may still be able to work with the DHA Debt Adjudication Office or the Department of the Treasury's Cross-Servicing Program to discuss other available options for financial relief.

Eligible applicants may receive a partial waiver or a full waiver. To be eligible for waiver consideration, the patient must have applied to the discount program first. If after the discount is applied, the patient wants to submit for a discretionary waiver, a medical provider will assess the extent to which the medical care provided to the patient enhanced the knowledge, skills, and abilities of the military health care providers.

The final decision authority is the Director, Defense Health Agency.

No. This program is only for medical care provided by a military hospital or clinic. It doesn't apply to civilian provider bills.

No. The regulation doesn't have a formal appeal process for a denied application. Instead, the regulation provides a path for reapplication or reconsideration if the applicant's financial situation changes.

We understand that receiving a bill for a service from a long time ago can be frustrating. The delay is attributable to our effort to prevent financial harm to any patient before the new, congressionally mandated protections were in place.

Section 716 of the FY23 NDAA was a landmark change in federal law. For the first time in its history, the Department of War was granted the authority to offer significant financial assistance to civilian patients. This was a major change that required us to build a new program from the ground up to comply with all legal requirements. This involved writing a new federal rule, which requires additional time to implement.

The decision to pause billing was made to ensure that no patient was billed under the previous, much more stringent, federal debt collection rules while we worked to design and implement a more compassionate authority.

While most insurance claims were filed during the billing delay period, many military medical facilities transitioned to a new medical billing system. Unfortunately, in some cases a patient’s health insurance information was added to their record after the initial billing process had started. The system incorrectly continued to treat the account as "uninsured." As a result, it held the bill in abeyance instead of sending a timely claim to the insurer.

Yes. Invoices will include information about the new MHS Modified Payment and Waiver Program and how to apply.

All civilian non-beneficiaries who received care on or after June 21, 2023, may apply to the MHS Modified Payment and Waiver Program.

Once a patient receives a medical bill, if they face financial harm, they are encouraged to apply for the program. All complete applications will be evaluated based on the standards in the final rule, effectively applying the sliding fee scale and catastrophic waiver benefits.

To prevent financial hardship, the program includes specific, structured payment options. While bills for separate episodes of care are processed individually and will not be consolidated, patients approved for the program may have each bill discounted under the law and are guaranteed access to flexible payment plans. As established by the rule, these payment plans can extend for up to 72 months and are interest-free.

No. Per federal guidelines, financial relief is not automatic and cannot be granted preemptively. The established process requires that a medical bill first be issued. Following that, the patient must apply for financial assistance through the MHS Modified Payment and Waiver Program. A balance can only be reduced or waived after a formal application has been submitted by the patient and adjudicated by the DHA Debt Adjudication Office.

For patients with health insurance, the military hospital or clinic will bill the insurer first. Patients with a remaining balance (e.g., for copayments, deductibles, coinsurance, etc.), will receive an invoice and may apply for a discount or waiver after that.

We'll retroactively file your insurance. If it's denied for the military hospital or clinic not having filed timely, you'll only receive the portion of the bill that you would have been responsible for under your health plan limitations.

You must apply within 90 days of receiving your medical bill. We're launching the program on March 9, 2026.

Applications will be processed within approximately 30 days.

Yes. The application form allows you to request a voluntary payment agreement. Payments may be spread out for up to 72 months interest free.

If you miss a payment and your account becomes more than 180 days delinquent, your account will be transferred to the Department of the Treasury’s collections program. The Treasury will assess interest on late payments and may impose administrative wage garnishment to collect the debt.

To be eligible for the waiver program, you must first apply for the discount program. After receiving your discounted bill, you may then apply for a waiver of the remaining balance by submitting Request for Medical Debt Discount, Military Health System Modified Payment and Waiver Program (DD Form 3201).

The rule mentions a 1099-C form. Will I have to pay income tax on the amount of debt that is waived, and when will I receive the 1099-C?

If your application for waiver is approved for $600 or more, that amount will be reported to the Internal Revenue Service, and you'll be issued a form 1099-C. We advise individuals to consult with a tax professional regarding their specific circumstances.

Eligibility for the MHS Modified Payment and Waiver Program isn't based on citizenship. It's based on the authority under which the care was provided. The Federal Rule explicitly excludes individuals who receive care "pursuant to an agreement between the United States and a foreign government or other entity." Therefore, if a foreign national is treated under the authority of an international agreement (such as a Status of Forces Agreement or Host Nation Support Agreement), their bill is handled according to the terms of that specific agreement, and the Modified Payment and Waiver Program would not apply.

However, if a foreign national is treated as a civilian non-beneficiary outside of such an agreement (for example, a tourist who is injured in an accident and taken to a military hospital for trauma care), they'd be eligible to apply for the MHS Modified Payment and Waiver Program.

Yes, the MHS Modified Payment and Waiver Program applies to civilian non-beneficiaries treated at our facilities worldwide, including federal employees. However, it doesn't apply to individuals who receive care under a specific international agreement between the U.S. and a foreign government, such as a Status of Forces Agreement that dictates billing terms.