MILITARY UPDATE
Low turnover in care network hides whole story
Military Update focuses on issues affecting pay, benefits and lifestyle of active and retired servicepeople. Its author, Tom Philpott, is a Virginia-based syndicated columnist and freelance writer. He has covered military issues for almost 25 years, including six years as editor of Navy Times. For 17 years he worked as a writer and senior editor for Army Times Publishing Co. Philpott, 49, enlisted in the U.S. Coast Guard in 1973 and served as an information officer from 1974-77.
By Tom Philpott
The number of civilian physicians participating in TRICARE Prime, the military managed care network, is higher than ever and turnover is about 2 percent a year, signaling satisfaction with reimbursement fees and paperwork.
But it's a good example of statistics hiding the real story, according to congressional testimony by physicians, patient advocates and even one of the top executives responsible for organizing and operating TRICARE provider networks.
"We may not have many providers turning over in our network," James E. Woys, president of Health Net Federal Services, told a House panel during an April 10 hearing on challenges facing TRICARE. "But we have more and more providers who are unwilling to accept new patients because of (reimbursement) rates."
Health Net is one of four contractors that administer networks of civilian hospitals and physicians for TRICARE nationwide, at a cost of $7.2 billion in 2002. The burgeoning civilian contracts eclipse the $4 billion being spent this year on military "direct" care, from base hospitals and clinics to combat medical units.
Members of the House Armed Services Subcommittee on Military Personnel said despite real improvements recently in TRICARE operations, they still get too many complaints from beneficiaries who can't find physicians, and from network physicians who won't accept more TRICARE patients because of low reimbursements and what they call a high hassle factor.
TRICARE uses Medicare reimbursement rates but those fell by 5.4 percent in 2002. Yet physicians said their costs for rent, malpractice insurance and staff continue to increase. Moreover, TRICARE support contractors, to protect profits, pressure network doctors in many areas to accept fees set below Medicare rates.
"The physician participation level is generally adequate," said Rep. John McHugh (R-N.Y.), the panel chairman. "But as my dad used to say, 'You put one foot in a bucket of ice water, the other foot in a bucket of boiling water. The average is comfortable?' "
Dr. Alan Storeygard, chairman of a 75-physician hospital organization, is part of the TRICARE network near Little Rock Air Force Base in Arkansas. Storeygard warned House members that his PHO soon might stop seeing TRICARE patients because a fee deal sought by Health Net is too low and TRICARE rules are too burdensome.
For example, TRICARE continues to require physicians to get "pre-authorizations" before referring patients to specialists. The extra paperwork costs his clinic $25,000 a year, Storeygard said. Most managed-care programs have abandoned pre-authorizations. Health Net's own study found the requirement to be "costly, inefficient and unnecessary," Storeygard said.
Reimbursements are an even bigger worry.
"Health Net is now demanding that our PHO physicians take a 15-percent cut in their current reimbursements," Storeygard said. "At this point, I doubt if our relationship with TRICARE can continue."
Last August, the 60-physician Pratt Medical Center, the largest multi-specialty group in Fredericksburg, Va., dropped out of the TRICARE network.
William White, Pratt's chief executive, said reimbursements on average are 40 percent below those of other local managed-care plans. Pratt isn't the only dropout, White said. By his count, only 17 primary care physicians in an area with 20,000 TRICARE beneficiaries still participate, "and, of those, few are accepting new patients."
The military surgeons general agree that physician participation is a serious concern for TRICARE, particularly with beneficiaries who need specialty care or live in rural areas.
Lt. Gen. James B. Peake, the Army's top doctor, said TRICARE users in the Fort Drum area, part of McHugh's district, have to travel 70 miles to Syracuse, N.Y., for specialty care such as dermatology. TRICARE, he said, has "not been able to negotiate appropriate arrangements with specialists in the local community."
Lt. Gen. Paul Carlton, Air Force Surgeon General, called physician participation "a significant problem." Many air bases are away from major population centers, he said, "and there's resistance to managed care that's remarkable in some areas of the country."
Congress a few years ago gave TRICARE officials authority to raise doctor reimbursements to 115 percent of Medicare rates in difficult areas. So far, it hasn't used it, fearing that costs will escalate, pressure to raise rates everywhere will intensify, with no guarantee a 15 percent bump will boost doctor participation. TRICARE officials, and some support contractors, prefer for Congress to raise Medicare rates on which TRICARE relies.
Sue Schwartz, testifying for The Military Coalition, a group of service associations, urged Congress to pressure TRICARE to use its special rate authority in areas where physicians won't join the network or refuse to accept new TRICARE patients.
Rep. Vic Snyder (D-Ark.), also a physician, chided TRICARE officials for not routinely soliciting feedback from network doctors. Their views, Snyder suggested, are significantly different from those of support contractors who aren't reluctant to replace one set of doctors if another set is available and will accept lower fees.
Snyder said TRICARE contract executives acknowledge doctors are struggling under Medicare rates, "yet I get reports from providers that the squeeze is being put on them to (accept) rates lower than Medicare. I might have to toss and turn at night if that were me doing that (to them)."
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