Summary: Pursuant to a congressional request, GAO reviewed Department of Defense (DOD) changes to the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS).
DOD is proposing to change CHAMPUS because of significant cost increases and other problems. GAO found that the objectives of the CHAMPUS reform initiative are to: (1) contain costs; (2) increase beneficiary access to medical care; (3) improve coordination between CHAMPUS and the military treatment facilities; (4) ensure quality care; and (5) simplify administrative procedures by contracting for the processing and payment of medical care claims. As part of the initiative, DOD proposed a new enrollment program to expand benefits and lower costs to beneficiaries willing to obtain medical care from the contractor's network of providers. GAO believes that DOD should resolve key issues before it proceeds with the implementation of the initiative, specifically whether: (1) cost containment can be accomplished within the proposed program structure; (2) contractors will have a financial incentive to provide minimum medical care at the lowest costs; and (3) simplifying CHAMPUS procedures will create problems in program administration.
