The MHS Optimization Project: Estimating the Potential for Recapturing CHAMPUS Workload in the MHS

This annotated briefing reports the results of a study for the Office of the Assistant Secretary of Defense for Health Affairs (OASD/HA) and the TRICARE Management Activity (TMA) on the Optimization Plan of the Military Health System (MHS). The plan is designed to make the MHS more efficient as well as to increase the overall health of DOD beneficiaries. Our main goal is to determine the link between optimization and several measures of system efficiency. We explore how greater efficiency can increase system capacity so that current workload that is going to the managed care support contractors (MCSCs) can come back into the MTFs). This "recapture" of CHAMPUS workload is the main focus of this study. We examine recapture in several ways: by the military's medical treatment facilities (MTFs) providing more of the inpatient (IP) workload (the overnight stays that go "downtown") and more of the outpatient (OP) visits that today might go to civilian providers. Some of the workload may be part of the Prime network of civilian providers that the MCSCs have set up for DOD beneficiaries, but the majority is for non-network services for which DOD ultimately pays. For both IP and OP workload, we examine whether MTF physicians can provide more of these services and compare the "complexity" of the work with that provided by civilian providers. Lastly, we examine the demand for services, by measuring the demand rates of DOD beneficiaries and how well that demand is managed by local MTFs.