New contractors for TRICARE

By Tom Philpott: Military update

Six million military health care beneficiaries, those who live in TRICARE’s North and South regions, will have new managed care support contractors and claim processors to deal with by April.

In a surprise development, two of three current TRICARE contractors — Health Net Federal Services and Humana Military Healthcare Services — lost to rival firms in their bids to handle next-generation support contracts. The three contracts are worth a total of $55.5 billion over five years.

Support contractors are critical to how beneficiaries perceive benefits. They run TRICARE’s triple option of managed care (TRICARE Prime), preferred provider network (TRICARE Extra) and fee-for-service insurance (TRICARE Standard).

Contractors build and manage provider networks, and control care referrals, enrollment, claims processing and customer service.

Aetna Government Health Plans of Hartford, Conn., will take over from Health Net in the North Region for 3 million beneficiaries in Connecticut, Delaware, District of Columbia, Illinois, Indiana, Iowa (Rock Island Arsenal area only); Kentucky (except Fort Campbell area); Maine, Maryland, Massachusetts, Michigan, Missouri (St. Louis area only); New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, Vermont, Virginia, West Virginia, and Wisconsin.

UnitedHealth Military & Veterans Services of Minnetonka, Minn., will take over the South Region from Humana. Its 2.9 million beneficiaries live in Alabama, Arkansas, Florida, Georgia, Kentucky (Fort Campbell area only), Louisiana, Mississippi, Oklahoma, South Carolina, Tennessee, and Texas (excluding areas of Western Texas).

UnitedHealth also will administer the Continued Health Care Benefit Program which provides premium-based transition health coverage to beneficiaries who lose military benefits.

TriWest Healthcare Alliance of Phoenix will remain TRICARE’s support contractor for 2.7 million beneficiaries in the West Region.

Here’s a link to more information on the new contracts:

http://www.tricare.mil/t3contracts

It won’t be known for another week or two whether losing bidders will file official protests. Barring any legal delays, health care delivery under the new contracts will begin April 1 after a 10-month transition.

Joyce Wessel Raezer, director of government relations for the National Military Family Association (NMFA), said this dramatic shift in contractors, affecting two-thirds of beneficiaries, was unexpected and creates uncertainties in a military community already under enormous stress.

“We were thinking maybe one incumbent would go, because you don’t want to have such big contracts in a small group (of firms) forever. But the idea that two would go? Looking at how this might affect military families, I’m a little nervous,” Raezer said.

Tom Philpott can be contacted at Military Update, P.O. Box 231111, Centreville, Va. 20120-1111, or by e-mail at: milupdate@aol.com