The Pentagon Prescribes
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The Department of Defense is not enthusiastic about other health care alternatives, such as FEHBP, for retirees. The Pentagon Prescribes Tricare By Peter Grier hen it comes to providing issues in a wide-ranging interview W health care, the US defense with Air Force Magazine in his establishment has much in common Pentagon office. One major point: with big civilian organizations. It The Defense Department is not Blue wants to keep costs down. It wants Cross/Blue Shield. The special needs to keep quality up. And, to balance of military health care mean that those goals, it is moving rapidly into “sometimes we have to use different the world of health maintenance or- approaches in order to either meet ganizations, or HMOs. The Pentagon ... objectives or to meet ... expecta- is doing this via implementation of tions” of beneficiaries, Martin said. the Tricare system. However, there are unique aspects When Retirees Hit 65 to the military health care system, as A major—some say the major— well. Unlike most private organiza- health question now facing the Pen- tions, it must take care of a hetero- tagon concerns the provision of geneous population that is spread benefits to military retirees who all over the world and in constant have reached the age of 65. motion. It must answer to the federal Retirees, when they turn 65, are government. And, most importantly no longer eligible for coverage under of all, it must be ready to operate in the Tricare system. Such retirees are a combat zone. effectively pushed into the hands “We’re the world’s largest HMO, of the Medicare system. They can that has to go to war,” said Dr. Edward continue to obtain treatment in D. Martin, acting assistant secretary military treatment facilities on a of defense for health affairs. space-available basis, but the closure As Martin points out, carrying out of bases and the general downsizing this role has its difficulties. Even as of military medicine means that such US military medical readiness re- low-priority appointments are very mains high, military health officials difficult to come by in many parts in recent months have had to struggle of the country. with everything from implementa- Polls show that virtually all mili- tion of Tricare co-payment schedules tary retirees feel that they were to health care for military retirees promised free health care for life for age 65 and over. themselves and their families when Martin, the Pentagon’s top health they joined the service, so long as official, touched on many of these they completed a full military career. AIR FORCE Magazine / January 1998 41 Instead they must wrestle with Me- Standard as a second payer; or subsi- concept in a manner similar to the digap insurance payments and the dization of retiree Medigap policies. Medicare Subvention experiment Medicare bureaucracy. “I think everybody is looking at that has already been approved. Top Pentagon officials no longer those options,” said Martin. The conference report of the Fis- dispute, as they once did, that such cal 1998 Department of Defense promises were made. They say they The FEHBP Option Appropriations Act, passed in Sep- know they have a moral obligation For the Pentagon, the FEHBP op- tember, said: “Alternative options to address this situation in an equi- tion is a particularly controversial [for providing health care to 65-and- table manner. issue in regard to military retiree over retirees], such as providing the “The department is looking to medicine. Many military organiza- Federal Employees Health Benefits put together an overall plan to try tions, including the Air Force Asso- [Program] to Medicare-eligible mili- to improve a predictable benefit for ciation, say that all Medicare-eligible tary retirees, exist and could serve these people,” said Martin. The plan former military members and their to further ameliorate the problems has three basic components. families should be able to join the caused by Tricare ‘lockout.’ ” The first core part of the Pentagon big federal employee health program. plan is Medicare Subvention. Under After all, they argue, employees The Changeover to Tricare this program, 65-and-over military from all other federal agencies, as The biggest recent change in mili- retirees would be able to use military well as members of Congress and tary health care, of course, is the facilities, receive a full Tricare ben- their staffs, can join FEHBP and implementation of the Tricare pro- efit, and have the Medicare funding stay in the system at and beyond gram. Tricare is the military’s version organization reimburse the Defense 65. Why not those who wore their of a managed care system for active Department for the cost of treat- nation’s uniform, as well? duty members, their dependents, and ment, as it does for other Medicare According to Martin, the De- under-65 military retirees. providers. partment of Defense has long had Tricare is a three-choice system. Theoretically, Medicare can reim- “grave concerns” about FEHBP Tricare Standard is a fee-for-service burse DoD at a reduced rate, since participation. option that is the same as the old care can be provided more cheaply One of these concerns centers on CHAMPUS (Civilian Health and within an MTF than in the private cost. Congressional Budget Office Medical Program of the Uniformed sector’s facilities. estimates of the price of opening up Services). Tricare Extra is a pre- Already, Congress has approved FEHBP to the military run from $1.6 ferred provider option that is less a Medicare Subvention demonstra- billion to $6 billion annually. The expensive than Standard for its tion project, called “Tricare Senior,” exact amount would depend on such ben eficiaries. Tricare Prime uses to test out the concept. The task of variables as whether all retirees are MTFs as the principal source of organizing the test has taken a little eligible, or only those over 65, or all health care services. longer to plan than officials antici- retirees, plus active duty dependents. Under Tricare the military con- pated, but the final sites list should A second concern involves military tracts out health services manage- be determined this fall, said Martin. readiness. The Defense Department ment to private firms in 12 domestic Also under review at this time has long contended that military US regions, plus Europe, the Pacific, is a program called “Partners,” the doctors need to see older pa tients— and Latin America. The last two second part of what the Pentagon who have a higher probability for regions in the US to get the pro- is studying for 65-plus health care. surgery and complicated medical gram—the Northeast and the Mid- Retirees would stay enrolled in procedures—on a regular basis in Atlantic—should have Tricare pro- Medicare HMOs, instead of joining order to sustain medical techniques viders up and running by mid-1998. Tricare (as they would under Medi- needed for combat medicine. Martin said that, by adopting the care Subvention). However, they “Basically, taking care of healthy efficiencies, such as volume dis- would maintain a relationship with young people does not make [suffi- counts, associated with managed military medicine—possibly through cient] use of their skills,” said Martin. care, the Department of Defense some link to pharmacy benefits. However, many of the proposals will be able to save money. And even The third part of the Pentagon’s to open up FEHBP to the military though the system is not fully up and plan for the 65-plus group entails are sweeping blueprints. If a more running yet, substantial savings have Medicare Subvention for treatment limited use of FEHBP were dis- already been incurred. at Veterans Affairs hospitals. cussed—as in the aforementioned “Otherwise, the money would have There is a problem, though. Even package plan to deal only with over- had to continue to come out of the if all three of these steps are adopted, 65s—“We’d have to reappraise it,” services and much higher priority some military retirees would still be said Martin. items,” said Martin. “So you’ve got uncovered. Those who live far from Congressional hearings and fur- to understand the context of what a VA facility or MTF would need to ther Washington discussion of the we’ve tried to do in Tricare.” be addressed by some other change FEHBP subject will likely take place From the point of view of de- of policy. this spring. creased cost and improved quality Among the alternatives for this Bills have been introduced in and access for beneficiaries, Tricare final group: allowing them to use both the House and Senate to allow has been extremely successful, said the Federal Employees Health Ben- military retirees over the age of 65 defense officials. Regions where it efits Program as a second payer to to join FEHBP in demonstration has been in operation for over 18 Medicare; using a modified Tricare programs at a few sites—testing the months show high levels of consumer 42 AIR FORCE Magazine / January 1998 satisfaction, measured by such things face, to be transparent or invisible determined there are significant and as reenrollment rates. to our beneficiaries.” important improvements we could However, as Martin acknowledges, make” in this regard. the implementation of the program Complaints About Co- In general, the changes now sweep- has been far from perfect. “We frank- Payments ing through military medicine are simi- ly made a whole bunch of mistakes, Another major complaint concerns lar to those that have greatly altered and there have been instances where multiple co-payments. Frequently, a civilian health care in recent years. our approach to particular commu- beneficiary would be referred to a “What we’re seeing in Tricare is nities [has] not worked,” said the specialist for additional lab work and our effort in the military to make DoD doctor.