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Military Medical Care: Questions and Answers

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Abstract:

The primary mission of the military health system, which encompasses the Defense Department's hospitals, clinics, and medical personnel, is to maintain the health of military personnel so they can carry out their military missions, and to be prepared to deliver health care during wartime. The military health system also provides, where space is available, health care services in Department of Defense (DOD) medical facilities to dependents of active duty service members and to retirees and their dependents.

The Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) was established in 1966 legislation as the military equivalent of a health insurance plan, run by DOD, for active duty dependents, military retirees and the dependents of retirees, survivors of deceased members, and certain former spouses. CHAMPUS reimburses beneficiaries for portions of the costs of health care received from civilian providers.

As a follow-on to CHAMPUS, DOD established Tricare to coordinate the efforts of the services' medical facilities. Tricare also provides beneficiaries with the opportunity to receive their care through a DOD-managed health maintenance organization (Tricare Prime), a preferred provider organization (Tricare Extra), or to continue to use regular CHAMPUS (now known as Tricare Standard).

The military health system currently includes some 75 hospitals and 461 clinics serving an eligible population of 8.9 million. It operates worldwide and employs some 39,000 civilians and 92,000 active duty military personnel. Calculating the total cost of military medical spending is complicated by the different categories of funds involved; DOD statistics on total medical spending indicate a growth from $17.5 billion in FY2000 to an estimated $39 billion in FY2007 (the latter figure includes an accrual fund for future retirees).

CHAMPUS was originally intended to provide retirees with health care benefits from the time of their retirement, usually in their mid-40s, to the time they become eligible for Medicare at age 65. In response to concerns about growing medical costs for retirees over age 65, the FY2001 Defense Authorization Act established a program, known as Tricare for Life, to serve as a second payer to Medicare for retirees and their spouses and survivors beginning in FY2002. Congress also extended a pharmacy benefit to Medicare-eligible beneficiaries.

Some retirees groups advocate opening the Federal Employees Health Benefits Program (FEHBP) to military retirees, but an FEHBP demonstration project did not prove very popular among beneficiaries.

This report, which replaces Issue Brief IB93103 of the same name, will be updated as new information becomes available. Military health care issues are addressed in annual defense authorization and appropriations bills; for additional details and the status of current legislation, see CRS Report RL32924, Defense: FY2006 Authorization and Appropriations, by Stephen Daggett.