Defense Health Care:

Limits to Older Retirees' Access to Care and Proposals for Change

T-HEHS-97-84: Published: Feb 27, 1997. Publicly Released: Feb 27, 1997.

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Pursuant to a congressional request, GAO discussed health care options for retired military members and their families, focusing on: (1) older retirees' options for accessing health care and the related effects of the Department of Defense's (DOD) recent health care system changes on their access to care; and (2) proposed alternatives for addressing retirees' concerns and their potential effects on beneficiary and government costs.

GAO noted that: (1) its work has shown that recent system downsizing has reduced all care, including space-available care, the only care retirees may access at military facilities; (2) in the last 10 years, the number of military medical personnel has declined by 15 percent and one-third of military hospitals have been closed, reflecting the one-third reduction in active-duty forces; (3) while further readiness-related downsizing decisions are pending, some predict more system reductions; (4) meanwhile, TRICARE, which does not allow older retirees to enroll in its Prime health care option (its new health maintenance organization option), is moving to maximize Prime enrollment at all the facilities; (5) as this takes place, older retirees' space-available care will further decline at most facilities and eventually end at some; (6) space-available care at military health facilities, moreover, is episodic and lacks the continuity so important to older retirees who have more frequent, and often chronic, medical problems than younger retirees; (7) although retirees may also access care through such government-sponsored programs as Medicare and private supplementary health insurance, many retirees experience coverage gaps and high out-of-pocket costs; (8) DOD and members of Congress have proposed alternatives to address the availability, cost, and coverage issues affecting retirees' access to care: (9) these proposals have potentially large price tags or fall short in helping those most affected by base closures and TRICARE's implementation; (10) allowing retirees to join the Federal Employees Health Benefits Program, or using the Civilian Health and Medical Program of the Uniformed Services as a second payer to Medicare, would provide retirees with more dependable, consistent access to care; (11) costs, however, would be considerable, in part because retirees whose care is now funded by other sources would most likely join the new program; (12) to mitigate these costs, DOD would probably need to explore measures such as alternative beneficiary cost sharing; (13) in addition, although not yet fully developed, DOD's pharmacy proposal would provide retirees a single benefit not covered by basic Medicare and could fill the gap in coverage until system restructuring decisions are made and the related consequences known; and (14) DOD has not yet decided, however, on benefit eligibility, delivery, or funding details for this proposal and thus it is too early to judge the cost implications.

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