High Stakes for TRICARE’s New Contract Awards

August 5, 2015

It did not take long for one of the largest health insurance contractors to file a formal protest against DoD over its recent award of the two new TRICARE regional contracts.

UnitedHealthcare, the current managed care support contractor for TRICARE in the West region, is challenging the contract award in both the East and West regions. Humana and Health Net recently won the awards in TRICARE's East and West regions, respectively. Only one contractor may win in each region.

It was predictable that protests would occur, just as they have in past awards. As one of DoD's largest contracts (worth billions over the contract's five option years), it's a high-stakes gamble for companies that put together complex and labor-intensive bids for contracts to provide care for TRICARE beneficiaries.

The Government Accounting Office (GAO) has 100 days from the date of the protest filing to investigate and adjudicate the UnitedHealthcare appeal. The GAO can use its findings to deny the protest or sustain it and issue corrective actions for DoD.

Corrective actions may include re-opening the competition of the contract(s), which happened during the last round of TRICARE contracts in 2012, when all three regional contracts were protested successfully and subsequently awarded to a different bidder in a lengthy and costly process for the government.

MOAA will keep you informed of further developments.

 

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