Accession Number:



Medicare Subvention Demonstration: Greater Access Improved Enrollee Satisfaction but Raised DOD Costs

Descriptive Note:

[Technical Report, Congressional Report]

Corporate Author:

United States General Accounting Office

Report Date:


Pagination or Media Count:



In the Balanced Budget Act BBA of 1997,1 Congress established a 3-year demonstration, called Medicare subvention, designed to improve the access of Medicare-eligible military retirees to care at military treatment facilities MTF. Historically, military retirees age 65 and over have had only limited access to military health care. Until they turned 65, they could enroll in TRICARE Prime, the Department of Defenses DOD managed care plan, which gave them priority access to MTFs. Alternatively, they could use one of DODs other plans that pays part of the cost of civilian health care. However, when they turned 65 and became eligible for Medicare, retirees lost their right to military health care and could obtain care at MTFs only if space were available after higher priority beneficiaries were treated.2 The demonstration allowed retirees3 to get their care largely at MTFs by enrolling in a DOD-run Medicare managed care organization known as TRICARE Senior Prime. Enrollees in Senior Prime could receive the full range of Medicare services, as well as some additional TRICARE services, and they would incur minimal out-of-pocket costs. For enrollees, the MTF became the focal point of their medical carethe source of all their primary care and much of their specialty care, as well as referrals to civilian network providers. Those retirees who chose not to enroll could still use MTFs on a space-available basis. However, given the MTFs new responsibilities for treating Senior Prime enrollees, nonenrollees might no longer be able to get care at MTFs.


Subject Categories:

  • Medicine and Medical Research
  • Administration and Management

Distribution Statement:

[A, Approved For Public Release]