Final answer:
The maximum amount a member has to pay annually for covered medical bills under TRICARE or the VA program is called the Catastrophic Cap. This limit protects beneficiaries from financial hardship due to high medical expenses while cost-sharing measures such as deductibles and copayments ensure responsible service usage.
Step-by-step explanation:
The maximum dollar amount that a member must pay under TRICARE or the Veterans Health Administration program in any fiscal year or enrollment period for covered medical bills is known as the Catastrophic Cap. This is a safeguard to help prevent financial hardship due to extensive medical costs. Other terms related to healthcare costs include Deductible, which is the amount policyholders must pay out-of-pocket before insurance coverage kicks in; Copayment, which is a fixed fee paid by the policyholder for services; and Coinsurance, which is a percentage of costs that the insured must pay even after reaching their deductible.
These cost-sharing measures like deductibles, copayments, and coinsurance are designed to reduce moral hazard by requiring the insured to bear a portion of the costs, promoting responsible use of medical services.