Background TRICARE Regional  Structure and Contracts Under TRICARE, beneficiaries may obtain health care through DOD’s  system of military hospitals and clinics, referred to as military treatment  facilities (MTF), or from civilian providers. DHA uses managed care  support contractors to develop networks of civilian providers, referred to  as network providers, to serve all TRICARE beneficiaries in geographic  areas called Prime Service Areas. The contractors also perform other  customer service functions, such as processing claims and assisting  beneficiaries with finding providers. Each TRICARE region within the  United States has a managed care support contractor. In July 2016, DOD  awarded its fourth generation of TRICARE managed care support  contracts. The new contracts reduced the number of TRICARE regions  from three (North, South, and West) to two (East and West). On January  1, 2018, the TRICARE program began health care delivery under these  contracts. TRICARE’s Health Plan  Options Prior to January 1, 2018, TRICARE’s non-Medicare-eligible beneficiary  population could obtain care through three basic health plan options— TRICARE Prime (managed care), TRICARE Standard (fee-for-service),  and TRICARE Extra (preferred provider organization)—that varied by  enrollment requirements, choices in civilian providers, and whether there  were established access standards. Beginning January 1, 2018, the  TRICARE Standard and Extra options were terminated and TRICARE  Select, a self-managed, preferred provider option, was established. (See  table 1.) Beneficiaries using the TRICARE Standard and Extra options as of  December 31, 2017, were automatically enrolled in TRICARE Select on  January 1, 2018. Beneficiaries are allowed to change their plan at any  time prior to January 1, 2019, after which they will only be able to change  plans during an annual open enrollment season or within a certain time  period following a qualifying life event. In August 2017, DOD estimated  that over 2 million beneficiaries will be enrolled in TRICARE Select, which  is approximately the same number of beneficiaries who used the  TRICARE Standard option. According to DOD, approximately 66 percent  of these beneficiaries resided in a Prime Service Area—where networks  of civilian providers have been established. TRICARE Select  Implementation Plan In addition to establishing the TRICARE Select option and making other  TRICARE program changes, the NDAA 2017 required DOD to develop an  implementation plan for TRICARE Select that includes seven specific  elements. These elements are, in part, intended to ensure beneficiaries’  access to care under the TRICARE Select option, and they require DOD  to ensure that at least 85 percent of the beneficiary population under  TRICARE Select is covered by the network by January 1, 2018  (Element A); ensure access standards for appointments for health care that meet  or exceed those of high-performing health care systems in the United  States, as determined by the Secretary (Element B); establish mechanisms for monitoring compliance with access  standards (Element C); establish health care provider-to-beneficiary ratios (Element D); monitor on a monthly basis complaints by beneficiaries with respect to  network adequacy and the availability of health care providers  (Element E); establish requirements for mechanisms to monitor the responses to  complaints by beneficiaries (Element F); and establish mechanisms to evaluate the quality metrics of the network  providers established under section 728 (of the NDAA 2017) (Element  G). DOD’s TRICARE  Select  Implementation Plan  Included the  Mandated Elements  and Addressed Most  Leading Planning  Practices, but Does  Not Reflect Current  Approach for Access  Standards DOD’s Implementation  Plan Included the  Mandated Elements and  Addressed Most Leading  Practices for Strategic  Management Planning The TRICARE Select implementation plan DOD submitted to Congress  included the seven specific elements mandated by the NDAA 2017.  Specifically, the implementation plan described the upcoming changes to  the TRICARE benefit and included individual sections outlining DOD’s  approach for implementing each of the required elements. For example,  for element A—ensure that at least 85 percent of the beneficiary  population under TRICARE Select is covered by the network by January  1, 2018—DOD described, among other things, how the regional  contractors will identify geographic areas with concentrations of TRICARE  Select beneficiaries and how they will establish a sufficient provider  network to serve that population. We also found that the implementation plan reflected most of the leading  practices for sound strategic management planning as identified by our  prior work. (See table 2.) These leading practices suggest that strategic  planning documents include the following: (1) a mission statement, (2)  goals, (3) strategies to achieve goals, (4) plans to assess progress, and  (5) identification of challenges and risks. For example, DOD’s  implementation plan clearly articulated a mission statement, which is “to  ensure beneficiaries receive the right level of care, at the right time,  delivered by the right provider.” Additionally, for six of the mandated  elements, DOD’s implementation plan outlined the goal, strategies to  achieve the goal, and how DOD will assess progress. (See elements A,  B, C, D, E, and F in table 2.) This information is supplemented by contract  documents that require specific plans and data reports from the managed  care support contractors. For example, for element A—ensure that at  least 85 percent of the beneficiary population is covered by the network— each managed care support contractor is required to submit monthly  performance reports that show that a sufficient number of providers in  primary and specialty care are available to meet access requirements.  While DOD’s implementation plan addressed many of our leading  practices, there were instances where some of the leading practices were  only partially addressed or not addressed at all. For example, none of the  mandated elements incorporated the leading practice related to  identifying the challenges and risks that could affect the success of the  element. Element G, Evaluation of Quality Metrics, Remains under  Development  We also found that the implementation plan partially addressed or did not  address the leading practices related to strategies or plans to assess  progress for element G—establish mechanisms to evaluate the quality  metrics of the network providers. The plan stated that DOD is reviewing  the required set of core quality performance metrics and will implement a  subset of these performance measures that can be used in future  contracts. However, the plan did not include several strategic details such  as (1) the process that DOD will use to determine the metrics, (2) the  criteria and resources that are needed to select the subset of these  performance measures, and (3) how DOD will assess progress and  evaluate future metrics. DOD officials told us that a workgroup of  departmental officials—including those from DHA and the TRICARE  Regional Offices and representatives of the military service branches— with expertise in health care quality are evaluating the metrics for inclusion in the subset of measures based  on criteria such as availability of data, the size of the population  affected, and resources needed; developing a work plan and time frames to analyze the metrics that  are (1) already being reported, (2) not being reported but data are  available, and (3) not being reported and require data solutions in  order to track information; and making preliminary recommendations on which measures to adopt  and which to consider for future adoption. DOD officials explained that some of the details of their approach to the  mandated elements had not been finalized when they were completing  the implementation plan, including some of the details for element G,  which continues to be a work in progress. They added that they were  under tight time constraints with competing priorities. They explained that  they had to plan for the implementation of TRICARE Select while  concurrently transitioning to new managed care support contracts, which  had to be modified to incorporate this new health plan option. Therefore,  while DOD officials were developing the TRICARE Select implementation  plan, they had to determine the specific program requirements for this  option and modify the contracts to account for these changes. Leading Practice on Challenges and Risks May Be Captured through  Contract Oversight Mechanisms  We also found that DOD’s implementation plan did not address the  leading practice related to recognizing the challenges or risks to success  for any of the seven elements. This practice ensures that an organization  considers any external factors that could significantly affect the  achievement of its goal. For example, for element A—ensure that at least  85 percent of the beneficiary population is covered by the network—the  implementation plan did not address what challenges and risks the  contractors might experience in establishing this network. For example,  one of the two managed care support contractors stated that it did not  have data on the beneficiaries who had sought coverage under TRICARE  Standard and Extra as these beneficiaries did not have to enroll in these  health plan options. Thus, the contractor explained that it was difficult to  establish a baseline for calculating the 85 percent network coverage  required for TRICARE Select. The other managed care support contractor  told us that specific challenges included negotiating provider discounts in  certain areas, identifying which providers participated in the past, and  balancing the composition of the network between primary and specialty  care. However, DOD officials told us that they considered and planned for  the challenges and risks associated with certain elements—including  establishing a monitoring and remediation process to help ensure  contractors meet the 85 percent network coverage requirement—even  though this was not described in the plan. DOD officials explained that their approach to the implementation plan  was to create a strategic overview rather than a detailed work plan. These  officials also told us that details and time frames related to the mandated  elements are captured in contract documents, such as those that  establish the managed care support contractors’ reporting and planning  requirements. Although these contract documents do not specifically  address challenges and risks for each element, officials stated that they  have oversight mechanisms in place that allow them to address any  challenges faced by these contractors, thereby mitigating any potential  risks. For example, DHA officials told us that the managed care support  contractors provide status updates on their network expansion progress  at weekly transition meetings with DHA and at biweekly meetings with the  TRICARE Regional Offices. DHA officials told us that the TRICARE  contracts have specific expansion goals and deadlines, such as requiring  that 50 percent of network providers are in the system 120 days prior to  the start of health care delivery. Given that both TRICARE Select and the  new TRICARE contracts were implemented on January 1, 2018, it is too  early to determine whether this approach will be sufficient to deal with any  upcoming challenges and risks. Implementation Plan Does  Not Reflect Current  Approach for Establishing  Access Standards Our review of element B—ensure access standards for appointments for  health care that meet or exceed those of high-performing health care  systems in the United States, as determined by the Secretary—noted that  the approach described in the implementation plan differs from the  approach that DOD intends to use. The implementation plan states that  the access standards for TRICARE Select will mirror those of TRICARE  Prime, DOD’s managed care option, and that DOD will continue to  compare these standards with those of high-performing U.S. health care  systems. However, DOD officials told us in interviews that the access  standards for TRICARE Select will be developed by each managed care  support contractor and approved by DOD. This approach is outlined in  contract documents, which state that the contractors are required to  develop access-to-care plans that detail how they will ensure access  standards that meet or exceed those of high-performing health care  systems in the United States. DOD officials told us that they did not intend to suggest in the plan that  the TRICARE Prime access standards would be applied to TRICARE  Select. Instead, these officials explained that they meant that the access  standards for TRICARE Select would be evaluated with the same tools as  the access standards for TRICARE Prime. DOD officials further stated  that they did not include information about the managed care support  contractors proposing their own access standards because they were still  developing the approach to this element when the implementation plan  was submitted. DOD officials told us they decided on this approach  because there is no national model for preferred provider organization  access standards, and therefore they did not want to be prescriptive  about the access standards for this option. However, as a result of this  approach, there is the potential that the managed care support  contractors for the East and West regions could be using two different  sets of access standards for TRICARE Select. Standards for internal control in the federal government state that  management should externally communicate the necessary information to  achieve the entity’s objectives. Because the implementation plan does  not reflect DOD’s current approach, Congress may be lacking important  information, including what responsibilities the contractors have in terms  of providing access to care, impeding its ability to provide oversight. Conclusions On January 1, 2018, DOD implemented significant changes to the  TRICARE program, which provides health care to millions of beneficiaries  worldwide. One of these changes is the establishment of a new preferred  provider option—TRICARE Select—intended to modernize the TRICARE  benefit and improve beneficiaries’ access to care. While DOD’s  implementation plan for this new option addressed all of the elements that  were required, time constraints along with competing priorities impeded  DOD’s ability to fully develop its approach for some elements, which are  being addressed through other oversight efforts. Furthermore, although  one of TRICARE Select’s primary goals is to improve access to care,  DOD’s implementation plan does not reflect how access standards will be  established. Without the most current information, it will be difficult for  Congress to determine whether the department is achieving its mission of  ensuring that beneficiaries receive the right level of care, at the right time,  delivered by the right provider. Recommendation for  Executive Action We recommend that the Secretary of Defense direct the Assistant  Secretary of Defense (Health Affairs) to provide written documentation of  DOD’s approach to developing and approving the TRICARE Select  access standards, as well as the final access standards, to Congress.  (Recommendation 1) Agency Comments We provided a draft of this report to DOD for comment. In its written  comments, which are reproduced in Appendix II, DOD concurred with our  recommendation. DOD stated that it will provide written documentation  about the TRICARE Select access standards to Congress by June 30,  2018. DOD did not provide technical comments. We are sending copies of this report to the Secretary of Defense and  appropriate congressional committees. In addition, the report will be  available at no charge on GAO’s website at http://www.gao.gov. If you or your staffs have any questions about this report, please contact  me at (202) 512-7114 or at draperd@gao.gov. Contact points for our  Office of Congressional Relations and Office of Public Affairs can be  found on the last page of this report. Other major contributors to this  report are listed in appendix II. Appendix I: Leading Practices for Strategic  Management Planning as Identified by  GAO’s Prior Work This appendix provides additional information regarding six elements  identified by our prior work as leading practices for strategic management  planning to establish a comprehensive, results-oriented framework. (See  table 3.) Appendix II: Comments from the Department  of Defense Appendix III: GAO Contact and Staff  Acknowledgments GAO Contact Staff  Acknowledgments In addition to the contact named above, Bonnie Anderson (Assistant  Director), Daniel Klabunde (Analyst-in-Charge), and Karen Belli made key  contributions to this report. Also contributing were Jacquelyn Hamilton  and Elizabeth T. Morrison.
DOD offers health care services to approximately 9.4 million eligible beneficiaries through TRICARE, DOD's regionally structured health care program. In each of its regions, DOD uses contractors to manage health care delivery through civilian provider networks, among other tasks. The NDAA 2017 made several changes to the TRICARE program, including the establishment of a new preferred provider network health plan option called TRICARE Select. The NDAA 2017 also required DOD to develop an implementation plan for TRICARE Select that addresses seven specific mandated elements on access to care, beneficiary complaints, and quality metrics for network providers. The NDAA 2017 included a provision for GAO to review the implementation plan. This report examines the extent to which DOD's implementation plan addressed the mandated elements. GAO evaluated DOD's implementation plan using leading planning practices identified in GAO's prior work and standards for internal control. GAO examined program policies, procedures, and contracts and interviewed DOD officials and TRICARE regional contractors. The Department of Defense's (DOD) TRICARE Select Implementation Plan addressed the seven specific elements mandated by the National Defense Authorization Act for Fiscal Year 2017 (NDAA 2017). These elements are Element A: ensuring that at least 85 percent of the TRICARE Select beneficiary population is covered by the network by January 1, 2018; Element B: ensuring access standards for health care appointments; Element C: establishing mechanisms for monitoring compliance with standards for access to care; Element D: establishing health care provider-to-beneficiary ratios; Element E: monitoring complaints by beneficiaries with respect to network adequacy and health care provider availability; Element F: establishing requirements for mechanisms to monitor the responses to complaints by beneficiaries; and Element G: establishing mechanisms to evaluate the quality metrics of the network providers. GAO also assessed the implementation plan against leading practices for sound strategic management planning and found that it incorporated many of the practices, such as establishing goals, strategies to achieve goals, and plans to assess progress. However, a few of the leading practices were only partially incorporated or not incorporated at all. For example, the implementation plan did not always fully address the leading practice that planning documents include strategies to achieve goals and plans to assess progress. DOD officials explained that some of the details of their approach to the elements had not been finalized when they were completing the implementation plan. These officials added that their approach to the implementation plan was to create a strategic overview, and that some of the details are contained in contract documents and monitored through their oversight responsibilities. Furthermore, GAO's assessment of the plan's elements found that the approach outlined in the implementation plan for ensuring access standards for health care appointments (Element B) is different from the approach DOD intends to use. The plan noted that DOD will use the access standards for TRICARE Prime—a managed care option—for TRICARE Select. However, DOD officials told GAO that the contractors are responsible for developing their own access standards, which DOD must approve. These officials added that DOD did not include information about the contractors proposing their own access standards because DOD was still developing its approach to this element when the plan was submitted. Because the implementation plan does not reflect DOD's current approach, Congress may not have the information it needs about the contractors' responsibilities for providing access to care, impeding its ability to provide oversight.