Defense Health Care:

Workload Reductions at Military Hospitals Have Increased CHAMPUS Costs

HRD-89-47: Published: Jul 10, 1989. Publicly Released: Jul 10, 1989.

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Pursuant to a congressional request, GAO examined the reduced access of beneficiaries to military medical facilities, focusing on: (1) the extent to which military facilities referred beneficiaries to the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS); (2) whether the reduced access occurred in inpatient or outpatient services; (3) whether reductions occurred in facilities across all of the military services; and (4) the reasons for the reduced access to military medical facilities.

GAO found that, between fiscal years (FY) 1985 and 1987: (1) military facilities had 64,000 fewer inpatient admissions, an 11-percent reduction, and 2.7 million fewer outpatient visits, a 10-percent reduction; (2) Navy facilities' inpatient admissions decreased by 31.5 percent and its outpatient visits decreased by 33 percent, while the Air Force's inpatient and outpatient services decreased by 10 percent and 2 percent, respectively, and the Army's services remained relatively stable; (3) patient work loads decreased for all major categories of beneficiaries; (4) the largest decreases in inpatient admissions occurred in obstetrics/gynecology and pediatrics, while the greatest decreases in outpatient services occurred in obstetrics/gynecology, pediatrics, and family practice services; (5) CHAMPUS inpatient admissions and outpatient visits increased by 50,800 and 2.5 million, respectively, at a total cost increase of about $700 million; and (6) 79 percent of the cost increase was for care to military beneficiaries living within 40 miles of military medical facilities. GAO also found that: (1) primary reasons for reduced access to military medical facilities included reductions in physician work loads to improve safe care levels, position vacancies and reduced staffing, and reduction of medical personnel time available for direct patient care; and (2) the Department of Defense has undertaken several initiatives to control future CHAMPUS cost increases and increase the availability of medical services to beneficiaries.

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