Healthcare Recommendations

Recommendation 5: Ensure service members receive the best possible combat casualty care by creating a joint readiness command, new standards for essential medical capabilities, and innovative tools to attract readiness-related medical cases to military hospitals  

MOAA has long supported the principle of establishing a Unified Medical Command to ensure inter-service consistency of policy and budget oversight, staffing, training, procurement efficiencies, and more. Although the MCRMC proposal has some similarities to that concept, the proposed Joint Readiness Command will be responsible for all of military readiness, which is too far-reaching.  

Astonishingly, for the vast amount of responsibility and management proposed, the recommendation does not include any budget oversight, limiting power. The commission’s Joint Command vision only grants participation in the budget process.  

The proposal also appears to envision further downsizing of Military Treatment Facilities (MTFs) and establishment of beneficiary copays in MTFs, though the proposed elimination of catchment areas could be positive, provided long-distance travel to MTFs is voluntary.  

Instead of creating another layer of bureaucracy, DoD should improve the current attempt at integration using the DHA as the foundation for getting to the next level.  The DHA is a step in the right direction, demonstrating that it can get things done.  The DHA should be given more authorities to consolidate and unify disparate service structures into an efficient and effective organization with common purposes which are clearly understood by all.

Unfortunately, to date, its budgetary successes have mainly been borne on the backs of the beneficiaries by higher pharmacy fees, mandatory mail order and rising premiums and co-payments.  The MCRMC health care proposals represent a “shot across the bow” and should serve as a catalyst for the DoD to quickly push through with these long needed structural reforms under the direction of Congress.  

MOAA Position – MOAA does not support this recommendation.     

Recommendation 6: Increase access, choice, and value of health care for active-duty family members, Reserve Component members, and retirees by allowing beneficiaries to choose from a selection of commercial insurance plans offered through a DoD health benefit program  

MOAA and the commission seek the same objective. However, we urge caution concerning any major changes to the military’s health care system (MHS) that could potentially have a negative impact on the medical readiness of personnel, as well as the entire AVF community.   

TRICARE has problems that need fixing and the status quo is unacceptable; however, instead of fixing the TRICARE program, the commission’s answer is to replace it with a Federal Employee Health Benefits Program (FEHBP)-like substitute. This change could have far-reaching implications and presents a high level of risk to medical readiness.  

This proposal is a seismic shift in the philosophy of delivering military health care coverage. If it is seriously entertained, it should be subject to much more scrutiny to ensure it meets beneficiary needs without changing the fundamental benefit value or leading to unintended consequences.

TRICARE is designed to support military readiness – to include military family readiness. FEHBP and FEHBP-like health plans serve a very different purpose and do not factor in military readiness and the unintended consequences could be severe.  

The idea of using MTFs as network providers, competing for business in the civilian marketplace, was not thoroughly examined in the commission’s report. MOAA believes this represents an unacceptable level of risk.   

The commission assumes that DoD, in working with FEHBP insurers, would be afforded the right to set provider payments and beneficiary copayments for MTFs versus other providers, and adjust as necessary. MOAA remains skeptical that a broad range of insurers would be comfortable with extending such authority to one provider, however preferred.  

Military families will have to receive extensive education when selecting health plans. The choices may be overwhelming and confusing, especially given the existing stressors of military life. Educating beneficiaries on their TRICARE benefits has been a challenge since the program’s inception. Under the MCRMC concept, DoD needs to effectively educate beneficiaries on an even greater array of plans, and MOAA has doubts.   

Premiums, copays, unique plan features, and the determination of medical necessity would vary by location and plan design. This would be a dramatic and unwelcome departure from what has been a program with a uniform benefit. Military families today can only plan as far as their next set of orders. They have come to rely on the uniform nature of the health benefit administered by TRICARE, no matter where they are stationed in the world.  

The needs of a military family can be dramatically changed by the demands of service. Unlike the TRICARE managed care support contractors, it is not clear that commercial plans under an FEHBP-like scenario would be sensitive to or responsive to a military family’s unique needs. “Ready to Serve,” a recent survey conducted by MOAA and the United Healthcare Foundation, shows that civilian mental health providers are not equipped with the necessary knowledge or cultural sensitivity required in the care of military and veteran populations.  

MOAA’s recent survey of 7,500 service members and their families revealed that four out of five prefer TRICARE to an FEHBP-like system for retirees and families. Nine out of ten do not feel confident that OPM would be able to understand and accommodate the unique needs of military families. The respondents include active duty, active duty family members, retirees, military spouses, and survivors of all the uniformed services.  

An additional concern of MOAA centers on the potential premium working-age retirees will pay. It is not clear how the commission determined premium cost shares for beneficiaries. A 20 percent premium cost share for retirees is substantially too high, regardless of any phase-in period. A cost structure this high devalues the in-kind premiums service members contributed through decades of arduous service and sacrifice acknowledged in previous cost-share settings.   

We are concerned that the commission proposal states overtly that its intent is to raise beneficiary costs as a means of curtailing DoD beneficiaries’ health care usage, which has exceeded civilian usage. MOAA has never accepted assertions that TRICARE in the 1990s entailed a 27 percent cost share.   

MOAA opposes funding care for non-TFL-eligibles through the Medicare-Eligible Retiree Health Care (MERHC) or other health care trust fund. This would add significantly more funds to the “mandatory spending” category Congress has sought to reduce.  This also imposes major administrative roadblocks to any future program enhancements or correcting unforeseen inequities that may arise.  

TRICARE has its Faults but can be Improved with Congressional Leadership  

Problems in TRICARE like rising costs, barriers to access, and lack of customer service in certain areas, can be addressed in a systematic manner without resorting to its elimination. The elimination of TRICARE would be akin to “throwing out the baby with the bath water” and does not get to the root of the problems. The recent MHS Review produced a baseline starting point.  

The time is ripe to institute change. The development of a new set of TRICARE contracts, set to start in 2017, is about to commence bidding. The Request for Proposal (RFP) seeks industry bidders and additional input has gone out. Now would be an opportune time to institute innovative ideas from industry.

The Department of Health and Human Services’ Centers for Medicare and Medicaid (CMS) have instituted reforms calling for more payments to providers that place the value of health care over volume. There needs to be more focus on value based reforms that reward innovation and quality outcomes. DoD and TRICARE should maintain alignment with Health and Human Services and set goals to institute these same types of payment reforms into the new contracts. For example, a program to benchmark that is already under TRICARE, the U.S. Family Health Plan, uses capitated financing to effectively manage its defined beneficiary population.   

A great deal of the cost increases have come from the current fee-for-service payment structure that TRICARE uses to pay its providers as this facilitates increased use of services. DoD must recognize that it is simply not possible to maintain a traditional fee-for-service discount purchasing strategy to keep costs down and improve access for beneficiaries.  

The discounted fee-for-service strategies from the past have also not been effective in creating provider networks that meet the needs of TRICARE beneficiaries in an economical and customer satisfying way. The commission acknowledged this feedback from beneficiaries in their report.  

A value-based model will require new ways of thinking and risk sharing. Under new contracts, managed support contractors and MTFs should be incentivized to align and integrate, with risk shared by each for the success of the whole.   

These payment innovations can and should be tried in a pilot program, using one or more of the enhanced multi-service markets as a testing ground. Experimenting with innovative public /private partnerships, including the VA, should be done to increase training case-mix and critical skills maintenance. This can be done now, without change to the whole system.

One area where the commission proposal to use an FEHBP-like program could be productive is for Guard and Reserve members and their families. We have long sought to bridge the health care continuity gap between and during periods of activation. As Guard and Reserve family members are not usually subject to frequent relocations and typically prefer to keep their employer coverage, the FEHBP-like concept would be more fitting for this population, including providing these families an option for an allowance to cover their civilian employer coverage during periods of deployment.  

By effective rationalization of the current military health care infrastructure, great savings can be gained with resulting better quality of care for beneficiaries. It simply does not make sense to keep open facilities with minimal inpatient occupancy.  

For the continuous development of the future MHS and TRICARE, DoD would benefit from frequent dialog with leaders in the health care industry. A regularly scheduled forum could be modeled after the existing Defense Health Board (DHB), focused on industry best-practices from all sectors. A forum like this could also leverage ideas from the commission and beneficiary engagement.  

Lastly, targeted investment should be made in technologies and people to support established joint processes and procedures that will generate real return on investment.    

MOAA Position – Recommendation requires further analysis and study.   

Recommendation 7: Improve support for service members’ dependents with special needs by aligning services offered under the Extended Care Health Option (ECHO) to those of state Medicare waiver programs  

We applaud the commission in addressing the unique challenges faced by military families with special needs. However, we believe it will be important to examine a transitional benefit for those who have depended on this program and will find themselves at the bottom of state Medicaid lists upon separation or retirement.   

The critical benefit must be provided to members of all seven of the uniformed services. Additionally, MOAA is concerned that Guard and Reserve families may have a difficult time transitioning in and out of the ECHO program. Finally, we believe it is important to consider a transitional benefit (1-3 years) for vulnerable families as they leave active duty service.  

MOAA Position – MOAA supports the recommendation.    

Recommendation 8: Improve collaboration between DoD/and VA by enforcing coordination on electronic medical records, a uniform formulary for transitioning service members, common services, and reimbursements  

From our perspective, a single uniform formulary would be beneficial only if the formulary is larger to meet the needs of both beneficiary populations.   

We believe the commission failed to adequately address access to National Guard medical records will be ensured, which are property of the respective states and difficult to obtain. Additionally, it is still unclear how DoD and VA interface with private providers to keep military records accurate and up-to-date if the Reserve Component is transitioned to TRICARE Choice.  

MOAA Position – MOAA supports the recommendation.