Defense Health Care: Additional Information and Monitoring Needed to Better Position DOD for Restructuring Medical Treatment Facilities
Fast Facts
About 9.6 million beneficiaries are eligible for Defense Department health care from Medical Treatment Facilities and TRICARE civilian providers. DOD issued a plan in February for a required restructure of Medical Treatment Facilities, which called for decreasing capability at 43 of them and closing five.
DOD’s restructuring review included required elements, such as assessing the adequacy of nearby civilian health care. However, it was based in part on incomplete and inaccurate information and may overstate the adequacy of available care.
We made 6 recommendations, including that DOD use more complete and accurate information in its review.
Military ID tags and stethoscope
Highlights
What GAO Found
The Department of Defense's (DOD) methodology to determine Medical Treatment Facilities' (MTF) restructuring actions in its implementation plan (the Plan) prioritized statutory elements. These included military readiness, adequacy of nearby civilian health care, and cost-effectiveness. However, DOD based part of its methodology on incomplete and inaccurate information.
- Civilian health care assessments did not consistently account for provider quality. DOD generally assumed that identified providers were of sufficient quality. GAO found that DOD considered the quality of nearby civilian providers for one of 11 selected MTFs. In this instance, information from the MTF about the variable quality of nearby civilian health care led to DOD's determination that such care was not yet adequate to support MTF restructuring. Officials GAO interviewed from other MTFs discussed concerns about quality of care from nearby civilian providers.
- Civilian health care assessments did not account for access to an accurate and adequate number of providers near MTFs. DOD may have included in its assessments providers who do not meet DOD's access-to-care standards for certain beneficiaries. For 11 selected MTFs, GAO found that about 56 percent of civilian primary care providers and 42 percent of civilian specialty providers that DOD identified as being nearby exceeded DOD's drive-time standards. Including such providers in its assessments means that DOD could have overestimated the adequacy of civilian health care providers in proximity to some MTFs.
- Cost-effectiveness assessments were based on a single set of assumptions. DOD concluded that civilian health care was more cost-effective than care in its MTFs without considering other assumptions that could affect its conclusions. For example, DOD applied assumptions about the cost of military personnel salaries, MTF workloads, and reimbursement rates for TRICARE that likely underestimated the cost-effectiveness of MTFs.
GAO also found that DOD conducted limited assessments of MTFs' support to the readiness of military primary care and nonphysician medical providers—an issue DOD officials stated they will address during MTF transitions. Until DOD resolves methodology gaps by using more complete and accurate information about civilian health care quality, access, and cost-effectiveness, DOD leaders may not fully understand risks to their objectives in restructuring future MTFs.
DOD's Plan identified actions needed to facilitate MTF restructuring, but the department is not well positioned to execute the transitions. DOD's Plan poses challenges for the military departments and the Defense Health Agency (DHA) related to MTF providers' readiness. Yet, DOD plans to move forward with restructuring without a process to monitor progress and challenges. By establishing roles and responsibilities for executing and monitoring MTF restructuring transitions, DOD can be better positioned to navigate organizational boundaries between the DHA that manages the MTFs and the military departments that provide staff. Additionally, by defining measurable objectives and progress thresholds, DOD can better ensure it is meeting objectives and facilitating timely adjustments to MTF restructuring transitions, as needed.
Why GAO Did This Study
DOD's MTFs are critical to the medical readiness of servicemembers and providing readiness training for about 107,000 active-duty medical providers. About 9.6 million beneficiaries are eligible for DOD health care through MTFs and civilian network providers. To further support readiness, the National Defense Authorization Act (NDAA) for Fiscal Year 2017 required DOD to plan to restructure MTFs. DOD's February 2020 Plan included decreasing capabilities at 43 MTFs and closing five.
The NDAA included a provision for GAO to review the Plan. This report addresses the extent to which 1) the Plan's methodology prioritized statutory elements and considered complete information, and 2) DOD is positioned to execute MTF restructuring transitions. GAO reviewed DOD's Plan, MTF workload and cost data, and interviewed DOD leaders and officials at 11 MTFs selected on the basis of military department, restructuring action, and location.
Recommendations
GAO is making six recommendations, including that future MTF assessments use more complete and accurate information about civilian health care quality, access, and cost-effectiveness; and that DOD establish roles, responsibilities, and progress thresholds for MTF transitions. DOD partially concurred with four recommendations and concurred with two. As discussed in the report, GAO continues to believe that all six recommendations are warranted.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | The Secretary of Defense should ensure that the Assistant Secretary of Defense for Health Affairs, in coordination with the Surgeons General of the military departments and the Director of the DHA, consistently collect complete and accurate information about the quality of available civilian health care in proximity to its MTFs (such as ratings from the Centers for Medicare and Medicaid Services and perceptions from MTF officials who regularly coordinate with civilian providers, among other means) and assess that information to inform recommendations for future MTF restructuring decisions. (Recommendation 1) |
DOD partially concurred with this recommendation. In August 2024, DOD confirmed to us its decision not to move forward with its 2020 restructuring plan or any other facility restructuring and requested that we close the recommendations from this report. DOD's implementation of the 2020 restructuring plan had been on hold since the COVID-19 pandemic affected planning assumptions. In December 2023, the Deputy Secretary of Defense announced a new strategy for the military health system whereby DOD will reattract beneficiaries to its medical facilities as opposed to downsizing or closing them and replacing them with civilian network provider health care. DOD's decision to cancel its plan to restructure medical facilities constitutes a change of circumstances for our recommendation, which was intended to improve a methodology that DOD no longer plans to repeat. We agree that it is appropriate to close the recommendation as no longer valid.
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| Department of Defense | The Secretary of Defense should ensure that the Assistant Secretary of Defense for Health Affairs, in coordination with the Surgeons General of the military departments and the Director of the DHA, consistently collect complete and accurate information about the extent to which current health care providers within the TRICARE networks meet access-to-care standards, and assess that information to inform recommendations on future MTF restructuring decisions. (Recommendation 2) |
DOD partially concurred with this recommendation. In August 2024, DOD confirmed to us its decision not to move forward with its 2020 restructuring plan or any other facility restructuring and requested that we close the recommendations from this report. DOD's implementation of the 2020 restructuring plan had been on hold since the COVID-19 pandemic affected planning assumptions. In December 2023, the Deputy Secretary of Defense announced a new strategy for the military health system whereby DOD will reattract beneficiaries to its medical facilities as opposed to downsizing or closing them and replacing them with civilian network provider health care. DOD's decision to cancel its plan to restructure medical facilities constitutes a change of circumstances for our recommendation, which was intended to improve a methodology that DOD no longer plans to repeat. We agree that it is appropriate to close the recommendation as no longer valid.
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| Department of Defense | The Secretary of Defense should ensure that the Assistant Secretary of Defense for Health Affairs, in coordination with the Surgeons General of the military departments and the Director of the DHA, consistently collect complete and accurate information about the extent to which non-network civilian health care providers that could be incorporated into the TRICARE network meet access-to-care standards in terms of drive time, and assess that information to inform recommendations on future MTF restructuring decisions. (Recommendation 3) |
DOD partially concurred with this recommendation. In August 2024, DOD confirmed to us its decision not to move forward with its 2020 restructuring plan or any other facility restructuring and requested that we close the recommendations from this report. DOD's implementation of the 2020 restructuring plan had been on hold since the COVID-19 pandemic affected planning assumptions. In December 2023, the Deputy Secretary of Defense announced a new strategy for the military health system whereby DOD will reattract beneficiaries to its medical facilities as opposed to downsizing or closing them and replacing them with civilian network provider health care. DOD's decision to cancel its plan to restructure medical facilities constitutes a change of circumstances for our recommendation, which was intended to improve a methodology that DOD no longer plans to repeat. We agree that it is appropriate to close the recommendation as no longer valid.
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| Department of Defense | The Secretary of Defense should ensure that the Assistant Secretary of Defense for Health Affairs, in coordination with the Surgeons General of the military departments and the Director of the DHA, conducts a sensitivity analysis of the relative cost-effectiveness of MTF-provided care compared to civilian-provided care under varying assumptions, and document that information for decision makers to inform recommendations on future MTF restructuring decisions. Varying conditions could include different types of health care services, reducing the cost of military personnel salaries, and increasing estimated MTF wRVUs and civilian reimbursement rates. (Recommendation 4) |
DOD partially concurred with this recommendation. In 2022, DOD developed a Transition Impact Analysis tool, which, according to a DOD memorandum and other documentation we reviewed, uses a standard set of evaluation criteria and key metrics to identify and prioritize MTFs for future restructuring efforts. The model can also estimate the change in costs based on the restructuring scenario, factor in one-time transition costs, and estimate the increase in private-sector care costs. According to DOD, the model is dynamic and allows the user to make adjustments to key assumptions to provide additional sensitivity analysis. Adjustments include the potential increase in private sector care reimbursement rates, potential under reporting in direct care workload, and the ability to exclude military pay. To fully implement this recommendation, DOD needs to apply the tool in making recommendations for MTF restructuring. As of January 2024, DOD officials stated that they had used the tool during 2023 to analyzes potential courses of action for restructuring MTFs in future years. However, the department has not yet provided documentation of this analysis to demonstrate the tool's application. We will update the status of this recommendation when more information is available.
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| Department of Defense | The Secretary of Defense should ensure that the Assistant Secretary of Defense for Health Affairs, in coordination with the Surgeons General of the military departments and the Director of the DHA, establishes clear roles and responsibilities for executing and monitoring transitions for MTFs identified for restructuring. (Recommendation 5) |
DOD concurred with this recommendation. In August 2024, DOD confirmed to us its decision not to move forward with its 2020 restructuring plan or any other facility restructuring and requested that we close the recommendations from this report. DOD's implementation of the 2020 restructuring plan had been on hold since the COVID-19 pandemic affected planning assumptions. In December 2023, the Deputy Secretary of Defense announced a new strategy for the military health system whereby DOD will reattract beneficiaries to its medical facilities as opposed to downsizing or closing them and replacing them with civilian network provider health care. DOD's decision to cancel its plan to restructure medical facilities constitutes a change of circumstances for our recommendation, which was intended to improve the plan's implementation. We agree that it is appropriate to close the recommendation as no longer valid.
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| Department of Defense | The Secretary of Defense should ensure that the Assistant Secretary of Defense for Health Affairs, in coordination with the Surgeons General of the military departments and the Director of the DHA, defines measurable objectives for MTF restructuring transitions, establishes thresholds and goals for each objective, and applies them to evaluate progress and challenges. For example, measurable objectives, thresholds, and goals, should include an evaluation of medical providers' clinical readiness, civilian health care provider adequacy, and the cost-effectiveness of MTF and purchased care. (Recommendation 6) |
DOD concurred with this recommendation. In August 2024, DOD confirmed to us its decision not to move forward with its 2020 restructuring plan or any other facility restructuring and requested that we close the recommendations from this report. DOD's implementation of the 2020 restructuring plan had been on hold since the COVID-19 pandemic affected planning assumptions. In December 2023, the Deputy Secretary of Defense announced a new strategy for the military health system whereby DOD will reattract beneficiaries to its medical facilities as opposed to downsizing or closing them and replacing them with civilian network provider health care. DOD's decision to cancel its plan to restructure medical facilities constitutes a change of circumstances for our recommendation, which was intended to improve the plan's implementation. We agree that it is appropriate to close the recommendation as no longer valid.
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