Also, as an employer, DOD offers health care services to 6.6 million non-active duty beneficiaries, including active duty members’ dependents and military retirees and their dependents. TRICARE Implementation Falling Short of DOD’s Expectations

In restructuring its health care program, DOD designed a program that has proven difficult to implement. As DOD implements TRICARE, it is also continuing to make significant changes to the program’s design. However, as of October 1997, only about half of the eligible beneficiaries using the military health care system had enrolled in TRICARE Prime. Thus, it appears that DOD could more fully and cost-effectively use its facilities before enrolling beneficiaries in civilian-provided care. DOD Not Adequately Assessing Progress in Achieving Program Goals

As we have noted, DOD’s goals in establishing TRICARE were to improve access while maintaining quality and controlling costs. DOD efforts to set goals and to measure access and quality are incomplete, however, and do not enable DOD or others to fully assess whether TRICARE has improved beneficiaries’ access to and quality of health care. Until this analysis is completed, questions will remain regarding the extent to which the legislative objective for TRICARE’s cost-effectiveness is being achieved. Ongoing and Planned Military Health System Changes Likely to Affect TRICARE

DOD’s efforts to fully implement TRICARE are occurring at a time when not only are changes being made in the organization to manage the program but other, perhaps more significant, changes are being contemplated for the military health care system itself. A second significant organizational change that may affect the future of TRICARE relates to the imminent retirement of the now Acting Assistant Secretary of Defense, who has served in Health Affairs for the past 9 years and has been a key force in the design and development of TRICARE. This would alter the potential cost-effectiveness of the program.
Why GAO Did This Study

GAO discussed the status of the Department of Defense's (DOD) implementation of its managed health care program, TRICARE, focusing on: (1) DOD's progress in implementing TRICARE; (2) whether DOD is adequately assessing TRICARE'S effects on military health care access, quality, and cost; and (3) the implications of ongoing and proposed changes in the military health care system itself for TRICARE's future.

What GAO Found

GAO noted that: (1) TRICARE was established in an era of military downsizing and rapidly escalating DOD health costs; (2) it was envisioned as a way to maintain beneficiary access to high-quality care while containing costs; (3) designing and implementing TRICARE to achieve these objectives, however, has proven to be a complex and difficult undertaking involving many stakeholders, including Congress, the individual services and their many facilities and contractors, and the more than 8 million beneficiaries of the military health care system; (4) DOD has taken steps to improve the program as it has evolved, but much remains to be done before TRICARE becomes the smooth-running and beneficiary-friendly endeavor envisioned by its developers; (5) moreover, many questions concerning its cost-effectiveness and ability to meet beneficiary access and quality of care concerns are still to be answered; (6) in addition to operational difficulties, TRICARE is likely to continue to be implemented amid many changes that could profoundly affect not only the program but the entire military health care system; and (7) the result of the continuing evolution of TRICARE and the collective effects of these individual changes on it remain to be seen.