TRICARE extends waiver for specialty care amid tumultuous transition to new contractors

Defense health officials say they’ve extended a waiver process for millions of TRICARE beneficiaries in the Western U.S. through the end of this month, letting them get specialty care without an explicit authorization from the health plan.

The extension follows a tumultuous transition period for TRICARE and its beneficiaries that began on Jan 1., the day the health system simultaneously underwent a consolidation of its regions, a switchover to two new multibillion dollar contracts to manage the program and a restructuring of the health benefit itself that was mandated in the 2018 National Defense Authorization Act (NDAA).

The new East and West regions both saw problems with long call center wait times, backlogged enrollments and referrals and delayed payments to providers. But the issues have proven to be longer-lasting in the Western region, where Health Net Federal Services assumed responsibility for administering the TRICARE system in January.

“As we started, both contractors were not meeting standards on performance,” said Ken Canestrini, the acting director of the TRICARE health plan said during an online Q&A hosted by the Military Officers Association of America.

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But he said Humana, the East region contractor, has since begun meeting most of the contract’s requirements, including one which requires beneficiaries’ calls to be answered within 30 seconds. Health Net has not, particularly on the busier Mondays and Tuesdays of each week, when call volumes surge beyond its current capacity of about 19,000 per day.

“The demand was more than they could output. So basically every day we started seeing a backlog creep up, creep up, and what’s happening is we aren’t moving those referrals through the system like we should for our beneficiaries so they can go get care.”

In an email to beneficiaries, Health Net said TRICARE Prime patients could get outpatient care from outside specialty providers without a prior authorization as long as their primary care provider issues the referral before March 31, and as long as the specialty care is scheduled to take place before June 30. Instead of going through Health Net’s approval process to request an authorization, they’ll be able to use a blanket approval letter posted on the company’s website.

Ordinarily, TRICARE wants specialty care referrals to go through the prior authorization process – not just to control costs — but to make sure DoD isn’t letting its own clinicians and military treatment facilities go underutilized.

“We have the system so that we can maximize an MTF. It’s all about reviewing that referral and seeing if we could put them back into the MTF,” Canestrini said. “The problem [with the waiver] is it does not allow me to get those referrals back into the MTF as an opportunity for readiness. But the primary goal is to ensure that the patient’s going to get care in a timely manner, so we’re meeting that obligation. We also want to make sure the quality control is good on the referrals – that they’re going to the right provider, the right specialty, the right zip code, etc., and that Health Net can indeed sustain the demand.”

Health Net is not new to the TRICARE business. Prior to winning the contract for the West region as part of DoD’s TRICARE T-2017 contracts, it had managed the former North region, prior to that area’s absorption into the new East region.

Call volume

To deal with the large call volumes, the company is adding employees and cross-training some of its existing workers in some of the unique aspects of the TRICARE system.

But Canestrini acknowledged the volume of calls that began to flow into the TRICARE contractors’ call centers after Jan. 1 was larger than either DoD or its contractors planned for.

Calls were also longer and more complicated: eight minutes in duration, on average, compared to three minutes prior to the transition. That’s due, in some part, to the fact that DoD was making significant changes to the structure and co-pays involved in its health plans at the same time, and beneficiaries had a lot of questions about how the new system worked.

“Vice Adm. [Raquel] Bono (the Defense Health Agency’s director) made the decision to combine the transition to T-2017, three regions to two, and all the NDAA activities, which had a lot of requirements for the healthcare community, into one plan and move this all through together. The goal was to avoid doing this two times — going through one transition and then turning around and telling people, ‘Oh, by the way, here’s some more changes.’”

Some of the problems were also inextricably linked to the complexity and inflexibility of DoD’s own IT systems.

The significant changes the NDAA called for in TRICARE benefits aren’t simple to accomplish in the Defense Enrollment Eligibility Reporting System (DEERS), the back-end system the department uses to manage and track who is eligible for various types of benefits.

In most cases, even a relatively simple policy change can force TRICARE to stop all new enrollments for a few days while DEERS is updated and restructured with new database fields. In this case, the changes were so significant that all enrollments were frozen for three full weeks leading up to the Jan. 1 transition, leaving the new contractors with a massive backlog of new paper-based enrollments that had to be entered into the system.

“Most of those are caught up now, but it took about 60 days of work to bring those in. It was another wrinkle that was out there,” Canestrini said.