DOD names three Tricare contract winners

Humana's existing contract is not renewed

Three national health care providers have been named to provide managed health care support for the Defense Department’s Tricare program under contracts that have a cumulative value of more than $55.3 billion.

The three winners are: TriWest Healthcare Alliance Corp., of Phoenix; Aetna Government Health Plans, of Hartford, Conn.; and United Health Military and Veterans Services, of Minnetonka, Minn.

But Humana Military Healthcare Services’ Tricare contract for the South region was not renewed.

The contract work includes management of provider networks and referrals, medical management, enrollment, claims processing, customer service and access to data, among other requirements, according to a DOD announcement.

TriWest Healthcare Alliance’s cost-plus-fixed-fee award will comprise a base period plus one option period worth $2,853,810,863. The total potential contract value, including the 10-month base period (transition-in) and five one-year option periods for health care delivery, plus a transition-out period, is estimated at $16,956,510,153.

TriWest will assist the military health system in operating an integrated health care delivery system combining resources of the contractor and the military’s direct medical care system to provide health, medical and administrative support services to eligible beneficiaries in the West Region.

The West Region includes the states of Alaska, Arizona, California, Colorado, Hawaii, Idaho, Iowa (except the Rock Island Arsenal area), Kansas, Minnesota, Missouri (except the St. Louis area), Montana, Nebraska, Nevada, New Mexico, North Dakota, Oregon, South Dakota, Texas (areas of Western Texas only), Utah, Washington and Wyoming.

Aetna Government Health Plans’ cost-plus-fixed-fee instant award will comprise a base period plus one option period for $2,840,302,541. The total potential contract value, including the 10-month base period (transition-in) and five one-year option periods for health care delivery, plus a transition-out period, is estimated at $16,678,172,561.

Aetna will assist in providing health, medical and administrative support services to eligible beneficiaries in the North Region, which includes the District of Columbia, Connecticut, Delaware, Illinois, Indiana, Iowa (Rock Island Arsenal area only); Kentucky (except the Fort Campbell area); Maine, Maryland, Massachusetts, Michigan, Missouri (St. Louis area only); New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, Vermont, Virginia, West Virginia, and Wisconsin.

United Health Military & Veterans Services’ cost-plus-fixed-fee award will comprise a base period plus one option period worth $3,729,016,358. The total potential contract value, including the 10-month base period (transition-in) and five one-year option periods for health care delivery, plus a transition-out period, is estimated at $21,827,600,469.

United Health will assist in providing health, medical and administrative support services to eligible beneficiaries in the South Region.

The South region includes Alabama, Arkansas, Florida, Georgia, Kentucky (the Fort Campbell area only), Louisiana, Mississippi, Oklahoma, South Carolina, Tennessee, and Texas (excluding areas of western Texas).

This contract was competitively procured via the Tricare Management Activity e-solicitation Web site with two offers received.

The Tricare Management Activity, Aurora, Colo., is the contracting activity.

Under its existing Tricare contract, Humana Military provides managed care services supporting the DOD’s delivery of health benefits to approximately 2.9 million active-duty service men and women, their dependents, as well as retired service members and their families in the South region.

That contract is currently set to expire on March 31, 2010, company officials said.

“Humana Military is disappointed with the decision by the Department of Defense and looks forward to obtaining further clarity via a debriefing on the bidding process,” said Dave Baker, president and CEO of Humana Military, in a statement.

“Our company will evaluate its strategic options with respect to the government’s decision, including protesting the award, and will act expeditiously to best position Humana for continued success,” he added.

About the Author

David Hubler is the former print managing editor for GCN and senior editor for Washington Technology. He is freelance writer living in Annandale, Va.

Reader Comments

Tue, Mar 16, 2010 FT. Benning, GA

DOD mandates the amount beneficiaries pay for Tricare coverage. This is not up to the contractor. The contractor just does what ever DOD tells them to do.

Tue, Mar 16, 2010

I am both a Tricare beneficiary and a former employee of Humana Military and Healthnet. I worked for Healthnet when the regions were revamped and Humana Military took over Texas and Louisiana. I will say that it was a fairly seamless transition as an employee and a beneficiary. All employees did have to go through the interview process, but Humana pretty much hired everyone who still wanted to work for Tricare. Humana is still in denial about losing the contract. They are telling their employees that they are appealing and will win. The funny thing is most of the people at the top of the food chain have left the company already.

Mon, Sep 14, 2009 Steve

"What does this mean for all of those employed by the current contractors? Will they lose their jobs?" A large percentage probably will. Most of those I dealt with on the phone didn't really seem to appreciate having the job anyway.

Fri, Jul 24, 2009

What does this mean for all of those employed by the current contractors? Will they lose their jobs?

Tue, Jul 21, 2009 Florida, USA

What about those of us who are now in Tricare For Life? Are you going to force us to go back to Standard? Will our Medicare/Tricare continue to be suficient? or; Will we have to pay more now? This new contractors are scaring the day lights out of me.

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