DOD Successfully Operated Medicare Managed Care Plans, Enrolled Many Retirees

The Senior Prime sites were successful in operating Medicare managed care plans. Sites expended substantial effort to meet Medicare+Choice requirements, and HCFA reviewers said that they generally did as well as other new health plans in meeting these requirements. However, HCFA reviewers found no major problems in the sites’ compliance and said that such deficiencies as they did note were generally typical of new plans. DOD Officials Indicated That, On Balance, Demonstration Had Positive Effects

DOD officials said that providing coordinated care for limited numbers of retirees yielded benefits for both retirees and medical staff. Site Officials Said Demonstration Benefited Seniors, Enhanced Readiness Skills, Had Little Adverse Effect on Other Beneficiaries

Site officials reported that Senior Prime enrollees received coordinated care and a broader range of services in contrast to the episodic space- available care or the mix of military and private care that many had received prior to Senior Prime. Demonstration Challenges Reflected, In Part, Larger DOD Managed Care Issues

Although some difficulties that DOD encountered in implementing Senior Prime reflected Medicare+Choice requirements or factors specific to the subvention demonstration, others highlighted underlying features of DOD managed care. Obtaining staff for the longer term was more problematic. Some lessons from the demonstration apply to military managed care generally.
Why GAO Did This Study

This interim report reviews the implementation of the Department of Defense (DOD) Medicare Subvention Demonstration.

What GAO Found

GAO found that the demonstration sites were successful in operating Medicare managed care plans. Officials put substantial effort into meeting Medicare managed care requirements and, according to Health Care Financing Administration reviewers, were generally as successful as other new Medicare managed care plans in this regard. Most sites reached the enrollment limits they had established for retirees already covered by Medicare. DOD officials indicated that the demonstration's effect was positive. Enrollees received a broader range of services from DOD than in the past, when they got care only when space was available in DOD facilities. Officials also noted that providing more comprehensive care to seniors helped sharpen the skills of military clinical staff, which contributed to their readiness for supporting combat or other military missions. Some challenges encountered in the demonstration reflect larger DOD managed care issues and may have implications for DOD managed care generally. Although access to care was generally good, the demonstration experienced some problems in maintaining adequate clinical staff.