DoD Awards TRICARE Managed Care Contracts for 2024

A total of $136 Billion in TRICARE Managed Care Support Contracts will be split between two major health contractors.

• By David Kopf
• Jan 19, 2023

The Department of Defense has awarded the next generation of TRICARE Managed Care Support Contracts in the amount of $136 Billion to two large contract recipients, according to The Defense Health Agency.

The new T-5 contracts will go into effect in 2024 and maintain the requirement for two TRICARE regions in the United States, East and West. The DoD awarded the $70.9 billion East Region T-5 MCS Contract to Humana Government Business of Louisville, Ky., and the DoD awarded the $65.1 billion West Region T-5 MCS Contract to TriWest Healthcare Alliance of Phoenix, Ariz.

The contracts will replace the current set of T-2017 managed care contracts under which healthcare is provided to eligible members of the uniformed services, their families, retirees and their families beginning in 2024. Until then, the T-2017 contracts remain in place.

In related news, six states currently managed in the East Region will transfer to the West Region to provide a more equitable balance of the beneficiary population, according to the DHA. States transferring to the TRICARE West Region are Arkansas, Illinois, Louisiana, Oklahoma, Texas and Wisconsin. The six states cover approximately 1.5 million TRICARE beneficiaries.

"I am pleased that our new T-5 TRICARE contracts will continue to focus on enhancing the experience of care and great healthcare outcomes for our service members, retirees and their families," said Lt Gen Ronald Place, Director of the Defense Health Agency.

The new contracts will continue to provide for the delivery of healthcare, customer service, claims processing and other administrative services to the estimated 9.6 million TRICARE beneficiaries. The new contracts do not change the TRICARE benefit and offer all the same TRICARE options.

"TRICARE is moving into a new era, making use of the lessons learned in the first three contract phases," Place added. "Defense Department leadership and the incumbent managed care support contractors are dedicated to managing a smooth transition to the new managed care support contractors, with minimum disruption to our beneficiaries."

The new contracts include a requirement to improve integration between military medical treatment facilities and the T-5 private sector care. One such improvement will increase interoperability with MHS GENESIS — the new electronic health record for the Military Health System — through Health Information Exchanges to deliver info faster to providers in both sectors.

The new contracts let beneficiaries transfer specialty care referrals when they move, whether their orders take them to a new duty station within their current region or to the other region. Also, the regions will be required to cut their average speed to answer calls to 20 seconds, matching healthcare industry standards, and must adhere to first-call resolution requirements for 85 percent of initial calls.

"We listened to our beneficiaries about what impacts their experience of care and address many of those concerns in T-5," Place noted.

After a 12-month transition period to the new contracts, military hospitals and clinics will have real-time access to medical management data. This increased data sharing should improve care coordination and access to care. And through improved visibility of data, the Military Health System will be able to standardize care between civilian and military facilities, which promises to improve patient care and safety, according to the DHA.

TRICARE beneficiaries do not need to take any actions at this time. The DHA will launch a communications campaign to keep TRICARE beneficiaries informed of coming changes during the year-long transition. Those interested in the progress should bookmark the web page www.tricare.mil/changes and sign up for regular bulletins at www.tricare.mil/About/Newsroom.