The Defense Health Agency (DHA) is planning to expand a demonstration for competition for TRICARE beneficiaries at the local and regional level, through the Competitive Plans Demonstration (CPD) project. DHA expects the CPD to begin health care delivery in Calendar Year (CY) 2026. If approved, the expanded CPD may open to three (3) more potential markets for competition from local or regional health plans in the T-5 East and/or West regions. DHA currently anticipates additional sites to transition in during CY 2027 with health care delivery starting in CY 2028.

Awarded CPD contractors will compete for beneficiary enrollment to provide the TRICARE benefit. The CPD contractors will provide networks, customer service, records management, referral management, and healthcare operations to TRICARE-eligible beneficiaries. Eligible beneficiaries in selected markets will have the option of enrolling to either the CPD contractor or to an existing regional TRICARE Managed Care Support Contractor (MCSC) during an annual enrollment period. Current T-5 MCSCs are excluded from participating in the CPD.

The Government intends to publish individual requests for proposals for each future market (local/regional) demonstration project. The period of performance of the Demonstration contract is anticipated to be a transition-in phase of one year, plus three one-year options for healthcare delivery, and a transition-out period.

The TRICARE Program is part of the Military Health System (MHS) in the United States that supports active duty service members (ADSMs); active duty family members (ADFMs); retired service members (RET) and their eligible family members (RETFMs); Survivors; Medal of Honor recipients; qualified former spouses; National Guard and Reserve members and their family members (including qualified non-active duty members of the Selected Reserve of the Ready Reserve, Retired Reserve, and certain members of the Individual Ready Reserve). TRICARE supplements the care provided in Department of Defense (DoD) Military Medical Treatment Facilities (MTFs), provides a variety of care options to beneficiaries under TRICARE Prime and Select, and provides care to those eligible beneficiaries living in areas without access to MTFs. The North American Industry Classification System (NAICS) Class Code is 524114.

The Government is also interested in testing alternative payment and delivery models and understanding a local or regional health plan’s willingness to take a percentage of the financial risk for the healthcare and administrative costs for a population of enrollees. The capitation rate would be based on the average historical Government cost of TRICARE Prime beneficiaries enrolled to the regional MCSC in the Demonstration market area. The rate would trend for inflation and would be risk-adjusted as appropriate.

Unless the Demonstration conditions allow for flexibility in this area, the enrolled beneficiaries would be subject to the same enrollment fees, copays, and other cost-shares, by beneficiary category (e.g., ADFM or non-Medicare retirees and their dependents), as specified in the standard TRICARE Prime benefit (see 10 U.S. Code § 1075a). For example, ADFMs enrolled in TRICARE Prime have no copays or other cost-shares for in-network non-pharmacy services.

To reduce barriers for local or regional health plans to participate in the CPD, under a separate acquisition, the DHA has executed the Eligibility, Enrollment and Encounter (EEE) Pilot to provide a HIPAA compliant-enrollment and eligibility function as well as a method to pass clinical and other claim information back to the DHA. The EEE pilot is designed as an enabling capability and interface to facilitate verifying beneficiary eligibility to participate in the CPD, beneficiary CPD enrollment, and processing beneficiary healthcare/CPD encounters.

Interested parties are asked to respond to the Request for Information using the Matrix Comment Sheet located in the attachment section and return to marcus.r.webb.civ@health.mil no later than 31 July 2024, 12 pm Mountain Standard Time (MST).

Additional Resources and References:

Link to T-5 Manuals: https://manuals.health.mil/

Attachments/Links