A small health plan serving 134,000 military family members, retirees and their dependents has been singled out as a model for a commercial-based Tricare program that could save the government money while improving health care for beneficiaries.

In its report of 15 recommendations to overhaul the military pay and benefits system, the Military Compensation and Retirement Modernization Commission cited the Uniformed Services Family Health Plan as an arrangement that shows how the panel's Tricare Choice program could work.

According to the panel, USFHP uses incentives and strategies to manage costs while providing optimal services, from managing frequent users of emergency rooms and high-risk patients to sponsoring call centers staffed by physicians or nurse practitioners who offer treatment advice and make appointments.

As a result, USFHP Alliance members have one-third fewer inpatient hospital days and 28 percent fewer emergency room visits than Tricare Prime enrollees, according to the report.

The program, available in six areas of the country, also had an overall member satisfaction rating in 2013 of 93 percent.

"[Our recommendations would] expand choice, access, quality and value of healthcare by offering family members, reserve component members and retirees a broad choice of insurance plans that are more flexible and efficient than the current Tricare system," commission chairman Alphonso Maldon Jr. told members of the Senate Armed Services Committee's personnel panel Feb. 11.

USFHP offers a health maintenance organization-style program to military beneficiaries at Tricare Prime rates in 16 states and the District of Columbia.

Participating health care providers include Brighton Marine Health Center, Christus Health, Johns Hopkins Health Care, Martin's Point Health Care, Pacific Medical Centers and St. Vincent Catholic Medical Centers.

The program became part of the military health system in 1982 when Congress transferred ownership of some U.S. Public Health Service hospitals to the current organizations and allowed military beneficiaries to continue receiving care at the facilities

Last year, a Government Accountability Office report called the USFHP redundant and recommended its elimination.

Noting that the program is offered in regions where more than 80 percent of the ZIP codes overlap with areas served by Tricare Prime through military hospitals, clinics and the Tricare network, GAO said the government spends more than $1 billion on the program and could "potentially save millions from ... duplicative administrative costs and profits."

According to GAO, the duplication restricts the military from optimizing its use of military hospitals and its Tricare network and draws benefits away from more cost-effective military facilities.

After the GAO report was issued, USFHP executives said they believe their program is a "model of health care for the future."

When the compensation commission mentioned USFHP in its report, Dr. David Howes, president and CEO of USFHP participant Martin's Point Health Care in Maine, said the group was pleased the commission recognized the program for providing "high quality health care to beneficiaries."

"The managed care approach used by the USFHP gives patients the care they need when and where they need it. ... We do everything we can to optimize patient wellness and to achieve positive long-term health outcomes," Howes said.

About Patricia Kime

Patricia Kime is a senior writer covering military and veterans health care, medicine and personnel issues.

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