II

106TH CONGRESS

2D SESSION S. 2486

To amend title 10, United States Code, to improve access to benefits under

the TRICARE program; to extend and improve certain demonstration

programs under the Defense Health Program; and for other purposes.

IN THE SENATE OF THE UNITED STATES

MAY 1, 2000

Mr. WARNER (for himself, Mr. LOTT, Mr. THURMOND, Mr. INHOFE, Ms.

SNOWE, Mr. ALLARD, Mr. HUTCHINSON, Mr. CRAIG, Mr. GREGG, Mr.

BOND, Mrs. HUTCHISON, Mr. CRAPO, Mr. HELMS, Mr. DASCHLE, Mr.

LEVIN, Mr. KENNEDY, Mr. LIEBERMAN, Mr. INOUYE, Mr. MACK, Mr.

REED, Mr. CLELAND, Mr. KERRY, Mr. ROBERTS, and Mr. SANTORUM)

introduced the following bill; which was read twice and referred to the

Committee on Armed Services

A BILL

To amend title 10, United States Code, to improve access

to benefits under the TRICARE program; to extend and

improve certain demonstration programs under the Defense Health Program; and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Military Health Care

5 Improvements Act of 2000’’.
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1 TITLE I—SENIOR HEALTH CARE

2 SEC. 101. EXTENSION OF TRICARE SENIOR SUPPLEMENT

3 DEMONSTRATION PROGRAM.

4 Section 722(a)(2) of the Strom Thurmond National

5 Defense Authorization Act for Fiscal Year 1999 (Public

6 Law 105–261; 112 Stat. 2065; 10 U.S.C. 1073 note) is

7 amended by striking ‘‘December 31, 2002’’ and inserting

8 ‘‘December 31, 2005’’.

9 SEC. 102. TRICARE SENIOR PRIME DEMONSTRATION PRO10 GRAM.

11 (a) EXTENSION OF DEMONSTRATION PROGRAM.—

12 Paragraph (4) of section 1896(b) of the Social Security

13 Act (42 U.S.C. 1395ggg(b)) is amended by striking ‘‘3-

14 year period beginning on January 1, 1998’’ and inserting

15 ‘‘period beginning on January 1, 1998, and ending on De16 cember 31, 2005’’.

17 (b) ADDITION OF MAJOR MEDICAL CENTERS.—

18 Paragraph (1)(A) of such section 1895(b) is amended by

19 striking ‘‘in a military treatment facility’’ and inserting

20 ‘‘in a Department of Defense medical center considered

21 by the Secretary to be a major medical center, in any other

22 military treatment facility,’’.

23 (c) DESIGNATION OF ADDITIONAL SITES.—Para24 graph (2) of such section 1896(b) is amended to read as

25 follows:
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1 ‘‘(2) DESIGNATION OF SITES.—

2 ‘‘(A) IN GENERAL.—The project estab3 lished under this section shall be conducted at

4 sites designated jointly by the administering

5 Secretaries after review of all TRICARE re6 gions.

7 ‘‘(B) SPECIFIC SITES.—The sites for the

8 project shall include the 6 sites designated in

9 accordance with subparagraph (A) before the

10 date of the enactment of the National Defense

11 Authorization Act for Fiscal Year 2001 and the

12 major medical centers designated after such

13 date in accordance with that subparagraph.’’.

14 SEC. 103. COVERAGE OF RETIREES OVER AGE 64 BY FED15 ERAL EMPLOYEES HEALTH BENEFITS PRO16 GRAM.

17 (a) EXTENSION OF COVERAGE FOR RETIREES OVER

18 AGE 64.—(1) Section 1108 of title 10, United States

19 Code, is amended by adding at the end the following:

20 ‘‘(m) EXTENSION OF COVERAGE FOR RETIREES

21 OVER AGE 64.—(1) Eligible beneficiaries referred to in

22 subsection (b)(1) who will be at least 65 years of age on

23 December 31, 2002, shall be permitted to enroll, or to ex24 tend a previous enrollment entered into under subsection
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1 (d)(2), during a period of open enrollment for the year

2 2003 (conducted in the fall of 2002).

3 ‘‘(2) Subject to paragraphs (2) and (3) of subsection

4 (f), the period of enrollment, or extension of enrollment,

5 of an eligible beneficiary under paragraph (1) shall be

6 three years unless the beneficiary disenrolls before the ter7 mination of the demonstration project.

8 ‘‘(3) The agreement under subsection (a) shall pro9 vide for continuation of the demonstration project for a

10 total of five contract years under the Federal Employees

11 Health Benefits program for eligible beneficiaries referred

12 to in paragraph (1).’’.

13 (2) Subsection (d) of such section is amended—

14 (A) in paragraph (1), by striking ‘‘three con15 tract years’’ and inserting ‘‘six contract years’’; and

16 (B) in paragraph (2), by striking ‘‘December

17 31, 2002’’ in the second sentence and inserting ‘‘De18 cember 31, 2005’’.

19 (3) Subsection (f)(1) of such section is amended by

20 adding at the end the following: ‘‘A beneficiary may not

21 extend the enrollment unless eligible to do so under sub22 section (m)(1).’’.

23 (b) ADDITIONAL AREAS OF COVERAGE.—Subsection

24 (c) of such section is amended—

25 (1) by striking ‘‘, but not more than ten,’’; and
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1 (2) by striking the third sentence and inserting

2 the following: ‘‘In establishing the areas, the Sec3 retary and Director shall include an area that in4 cludes the catchment area of one or more military

5 medical treatment facilities, an area that is not lo6 cated in the catchment area of a military medical

7 treatment facility, an area in which there is a Medi8 care Subvention Demonstration project area under

9 section 1896 of title XVIII of the Social Security

10 Act (42 U.S.C. 1395ggg), and one area for each

11 TRICARE region. Each area selected after the date

12 of the enactment of the National Defense Authoriza13 tion Act for Fiscal Year 2001 shall be an area that

14 is not located in the catchment area of a military

15 medical treatment facility.’’.

16 SEC. 104. IMPLEMENTATION OF REDESIGNED PHARMACY

17 SYSTEM.

18 (a) ENROLLMENT FEE AND DEDUCTIBLES RE19 QUIRED.—Subsection (b) of section 723 of the Strom

20 Thurmond National Defense Authorization Act for Fiscal

21 Year 1999 (Public Law 105–261; 112 Stat. 2068; 10

22 U.S.C. 1073 note) is amended to read as follows:

23 ‘‘(b) ENROLLMENT FEES, DEDUCTIBLES, AND

24 OTHER CHARGES.—(1) The Secretary may require each

25 eligible individual described in subsection (e) who partici-
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1 pates in the redesigned pharmacy system to pay an enroll2 ment fee. The Secretary shall ensure that any such enroll3 ment fee required after December 31, 2000, is lower than

4 the enrollment fee charged under this subsection on such

5 date.

6 ‘‘(2) The Secretary may also impose one or more

7 cost-sharing requirements for each individual referred to

8 in paragraph (1) for benefits under the redesigned phar9 macy system as follows:

10 ‘‘(A) An annual deductible requirement for each

11 such individual.

12 ‘‘(B) Any premiums, copayments, or other

13 charges that the Secretary would otherwise collect

14 from individuals similar to such individual.’’.

15 (b) PERIODIC PAYMENT OF PREMIUMS.—Subsection

16 (b) of such section is further amended by adding at the

17 end the following:

18 ‘‘(2) An individual may elect to pay a premium

19 charged under this subsection on a monthly or quarterly

20 basis.’’.

21 (c) EFFECTIVE DATE.—The amendments made by

22 this section shall take effect on January 1, 2001, and shall

23 apply with respect to participation in the redesigned phar24 macy system under section 723 of Public Law 105–261

25 for months beginning on or after that date.
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1 TITLE II—TRICARE PROGRAM

2 SEC. 201. ADDITIONAL BENEFICIARIES UNDER TRICARE

3 PRIME REMOTE PROGRAM IN CONUS.

4 (a) COVERAGE OF OTHER UNIFORMED SERVICES.—

5 (1) Section 1074(c) of title 10, United States Code, is

6 amended—

7 (A) by striking ‘‘armed forces’’ each place it ap8 pears, except in paragraph (3)(A), and inserting

9 ‘‘uniformed services’’;

10 (B) in paragraph (1), by inserting after ‘‘mili11 tary department’’ in the first sentence the following:

12 ‘‘, the Department of Transportation (with respect

13 to the Coast Guard when it is not operating as a

14 service in the Navy), or the Department of Health

15 and Human Services (with respect to the National

16 Oceanic and Atmospheric Administration and the

17 Public Health Service)’’;

18 (C) in paragraph (2), by adding at the end the

19 following:

20 ‘‘(C) The Secretary of Defense shall consult

21 with the other administering Secretaries in the ad22 ministration of this paragraph.’’; and

23 (D) in paragraph (3)(A), by striking ‘‘The Sec24 retary of Defense may not require a member of the

25 armed forces described in subparagraph (B)’’ and
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1 inserting ‘‘A member of the uniformed services de2 scribed in subparagraph (B) may not be required’’.

3 (2)(A) Subsections (b), (c), and (d)(3) of section 731

4 of the National Defense Authorization Act for Fiscal Year

5 1998 (Public Law 105–85; 111 Stat. 1811; 10 U.S.C.

6 1074 note) are amended by striking ‘‘Armed Forces’’ and

7 inserting ‘‘uniformed services’’.

8 (B) Subsection (b) of such section is further amended

9 by adding at the end the following:

10 ‘‘(4) The Secretary of Defense shall consult with the

11 other administering Secretaries in the administration of

12 this subsection.’’.

13 (C) Subsection (f) of such section is amended by add14 ing at the end the following:

15 ‘‘(3) The terms ‘uniformed services’ and ‘ad16 ministering Secretaries’ have the meanings given

17 those terms in section 1072 of title 10, United

18 States Code.’’.

19 (3) Section 706(b) of the National Defense Author20 ization Act for Fiscal Year 2000 (Public Law 106–65; 113

21 Stat. 684) is amended by striking ‘‘Armed Forces’’ and

22 inserting ‘‘uniformed services (as defined in section

23 1072(1) of title 10, United States Code)’’.
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1 (b) COVERAGE OF IMMEDIATE FAMILY.—(1) Section

2 1079 of title 10, United States Code, is amended by add3 ing at the end the following:

4 ‘‘(p)(1) Subject to such exceptions as the Secretary

5 of Defense considers necessary, coverage for medical care

6 under this section for the dependents referred to in sub7 section (a) of a member of the uniformed services referred

8 to in section 1074(c)(3) of this title who are residing with

9 the member, and standards with respect to timely access

10 to such care, shall be comparable to coverage for medical

11 care and standards for timely access to such care under

12 the managed care option of the TRICARE program known

13 as TRICARE Prime.

14 ‘‘(2) The Secretary of Defense shall enter into ar15 rangements with contractors under the TRICARE pro16 gram or with other appropriate contractors for the timely

17 and efficient processing of claims under this subsection.

18 ‘‘(3) The Secretary of Defense shall consult with the

19 other administering Secretaries in the administration of

20 this subsection.’’.

21 (2) Section 731(b) of the National Defense Author22 ization Act for Fiscal Year 1998 (Public Law 105–85; 111

23 Stat. 1811; 10 U.S.C. 1074 note) is amended—

24 (A) in paragraph (1), by adding at the end the

25 following: ‘‘A dependent of the member, as described
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1 in subparagraph (A), (D), or (I) of section 1072(2)

2 of title 10, United States Code, who is residing with

3 the member shall have the same entitlement to care

4 and to waiver of charges as the member.’’; and

5 (B) in paragraph (2), by inserting ‘‘or depend6 ent of the member, as the case may be,’’ after ‘‘(2)

7 A member’’.

8 (c) EFFECTIVE DATE.—(1) The amendments made

9 by subsection (a)(2), with respect to members of the uni10 formed services, and the amendments made by subsection

11 (b)(2), with respect to dependents of members, shall take

12 effect on the date of the enactment of this Act and shall

13 expire with respect to a member or the dependents of a

14 member, respectively, on the later of the following:

15 (A) The date that is one year after the date of

16 the enactment of this Act.

17 (B) The date on which the amendments sub18 section (a)(1) or (b)(1) apply with respect to the

19 coverage of medical care for and provision of such

20 care to the member or dependents, respectively.

21 (2) Section 731(b)(3) of Public Law 105–85 does not

22 apply to a member of the Coast Guard, the National Oce23 anic and Atmospheric Administration, or the Commis24 sioned Corps of the Public Health Service, or to a depend25 ent of a member of a uniformed service.
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1 SEC. 202. ELIMINATION OF COPAYMENTS FOR IMMEDIATE

2 FAMILY.

3 (a) NO COPAYMENT FOR IMMEDIATE FAMILY.—Sec4 tion 1097a of title 10, United States Code, is amended—

5 (1) by redesignating subsection (e) as sub6 section (f); and

7 (2) by inserting after subsection (d) the fol8 lowing new subsection (e):

9 ‘‘(e) NO COPAYMENT FOR IMMEDIATE FAMILY.—No

10 copayment shall be charged a member for care provided

11 under TRICARE Prime to a dependent of a member of

12 the uniformed services described in subparagraph (A),

13 (D), or (I) of section 1072 of this title.’’.

14 (b) EFFECTIVE DATE.—The amendments made by

15 subsection (a) shall take effect on October 1, 2000, and

16 shall apply with respect to care provided on or after that

17 date.

18 SEC. 203. IMPROVEMENT IN BUSINESS PRACTICES IN THE

19 ADMINISTRATION OF THE TRICARE PRO20 GRAM.

21 (a) REQUIREMENT.—Not later than October 1, 2001,

22 the Secretary of Defense shall take actions that the Sec23 retary considers appropriate to improve the business prac24 tices used in administering the access of eligible persons

25 to health care services through the TRICARE program
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1 under chapter 55 of title 10, United States Code, includ2 ing the practices relating to the following:

3 (1) The availability and scheduling of appoint4 ments.

5 (2) The filing, processing, and payment of

6 claims.

7 (3) Public relations efforts that are focused on

8 outreach to eligible persons.

9 (4) The continuation of enrollments without ex10 piration.

11 (5) The portability of enrollments nationwide.

12 (b) CONSULTATION.—The Secretary of Defense shall

13 consult with the other administering Secretaries in the de14 velopment of the actions to be taken under subsection (a).

15 (c) REPORT.—Not later than March 15, 2001, the

16 Secretary of Defense shall submit to the Committees on

17 Armed Services of the Senate and House of Representa18 tives a report on the actions to be taken under subsection

19 (a).

20 (d) DEFINITIONS.—In this section the terms ‘‘admin21 istering Secretaries’’ and ‘‘TRICARE program’’ shall have

22 the meanings given such terms in section 1072 of title 10,

23 United States Code.
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1 TITLE III—JOINT INITIATIVES

2 WITH DEPARTMENT OF VET3 ERANS AFFAIRS

4 SEC. 301. TRACKING PATIENT SAFETY IN MILITARY AND

5 VETERANS HEALTH CARE SYSTEMS.

6 (a) CENTRALIZED TRACKING PROCESS.—The Sec7 retary of Defense and the Secretary of Veterans Affairs

8 shall jointly prescribe a centralized process for the report9 ing, compiling, and analysis of errors in the provision of

10 health care under the Defense Health Program and the

11 Department of Veterans Affairs health care system that

12 endanger patients beyond the normal risks associated with

13 the care and treatment of the patients.

14 (b) SAFETY INDICATORS, ET CETERA.—The process

15 shall include such indicators, standards, and protocols as

16 the Secretary of Defense and the Secretary of Veterans

17 Affairs consider necessary for the establishment and ad18 ministration of an effective process.

19 SEC. 302. PHARMACEUTICAL IDENTIFICATION TECH20 NOLOGY.

21 (a) BAR CODE IDENTIFICATION TECHNOLOGY.—The

22 Secretary of Defense and the Secretary of Veterans Af23 fairs shall jointly develop a system for the use of bar codes

24 for the identification of pharmaceuticals.
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1 (b) USE IN NATIONAL MAIL ORDER PHARMA2 CEUTICALS DEMONSTRATION PROJECT.—The Secretary

3 of Defense, in consultation with the Secretary of Veterans

4 Affairs, shall experiment with the use of bar code identi5 fication of pharmaceuticals in the administration of the

6 mail order pharmaceutical demonstration project being

7 carried out under section 702 of the National Defense Au8 thorization Act for Fiscal Year 1993 (Public Law 102–

9 484; 106 Stat. 2431; 10 U.S.C. 1079 note).

10 TITLE IV—OTHER MATTERS

11 SEC. 401. PERMANENT AUTHORITY FOR CERTAIN PHARMA12 CEUTICAL BENEFITS.

13 (a) AUTHORITY.—(1) Chapter 55 of title 10, United

14 States Code, is amended by adding at the end the fol15 lowing:

16 ‘‘§ 1110. Pharmaceutical benefits

17 ‘‘(a) PHARMACEUTICALS BY MAIL.—The Secretary of

18 Defense shall authorize eligible persons to obtain prescrip19 tion pharmaceuticals by mail in connection with medical

20 care furnished to such persons under this chapter.

21 ‘‘(b) RETAIL PHARMACY NETWORK.—To the max22 imum extent practicable, the Secretary of Defense shall

23 include in each managed health care program under this

24 chapter, a program to supply prescription pharmaceuticals

25 to eligible persons through a managed care network of
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1 community retail pharmacies in the area covered by the

2 managed health care program.

3 ‘‘(c) ELIGIBLE PERSONS.—A person is eligible to ob4 tain pharmaceuticals under the program of pharma5 ceuticals by mail under subsection (a) or through a retail

6 pharmacy network included in a managed health care pro7 gram under subsection (b) as follows:

8 ‘‘(1) A person who is eligible for medical care

9 under a contract for medical care entered into by the

10 Secretary of Defense under section 1079 or 1086 of

11 this title.

12 ‘‘(2) A person who would be eligible for medical

13 care under a contract for medical care entered into

14 under section 1086 of this title except for the oper15 ation of subsection (d)(1) of such section.

16 ‘‘(d) PHARMACEUTICALS OFFERED.—The Secretary

17 of Defense shall determine the pharmaceuticals that may

18 be obtained by eligible persons under subsection (a) or (b).

19 ‘‘(e) FEES.—The Secretary of Defense shall prescribe

20 an appropriate fee, charge, or copayment to be paid by

21 persons for pharmaceuticals obtained under subsection (a)

22 or (b).

23 ‘‘(f) CONSULTATION REQUIREMENT.—The Secretary

24 of Defense shall consult with the other administering Sec25 retaries in the administration of this section.’’.
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1 (2) The table of sections at the beginning of such

2 chapter is amended by adding at the end the following:

‘‘1110. Pharmaceutical benefits.’’.

3 (b) REPEAL OF SUPERSEDED AUTHORITY.—Section

4 702 of the National Defense Authorization Act for Fiscal

5 Year 1993 (Public Law 102–484; 106 Stat. 2431; 10

6 U.S.C. 1079 note) is repealed.

7 (c) EFFECTIVE DATE.—This section and the amend8 ments made by this section shall take effect on January

9 1, 2001.

10 SEC. 402. PROVISION OF DOMICILIARY AND CUSTODIAL

11 CARE FOR CHAMPUS BENEFICIARIES.

12 (a) CONTINUATION OF CARE FOR CERTAIN

13 CHAMPUS BENEFICIARIES.—Section 703(a)(1) of the

14 National Defense Authorization Act for Fiscal Year 2000

15 (Public Law 106–65; 113 Stat. 682; 10 U.S.C. 1077 note)

16 is amended by inserting before the period at the end the

17 following: ‘‘or by the prohibition in section 1086(d)(1) of

18 such title’’.

19 (b) COST LIMITATION FOR INDIVIDUAL CASE MAN20 AGEMENT PROGRAM.—(1) Section 1079(a)(17) of title 10,

21 United States Code, is amended—

22 (A) by inserting ‘‘(A)’’ after ‘‘(17)’’; and

23 (B) by adding at the end the following:
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1 ‘‘(B) The total amount expended under sub2 paragraph (A) for a fiscal year may not exceed

3 $100,000,000.’’.

4 (2) Section 703 of the National Defense Authoriza5 tion Act for Fiscal Year 2000 is amended by adding at

6 the end the following:

7 ‘‘(e) COST LIMITATION.—The total amount paid for

8 services for eligible beneficiaries under subsection (a) for

9 a fiscal year (together with the costs of administering the

10 authority under that subsection) shall be included in the

11 expenditures limited by section 1079(a)(17)(B) of title 10,

12 United States Code.’’.

13 (2) The amendments made by paragraphs (1) and (2)

14 shall apply to fiscal years after fiscal year 1999.

15 SEC. 403. STUDIES OF ACCRUAL FINANCING FOR HEALTH

16 CARE FOR MILITARY RETIREES.

17 (a) STUDIES REQUIRED.—The Secretary of Defense

18 shall carry out two studies to assess the feasibility and

19 desirability of financing the military health care program

20 for retirees of the uniformed services on an accrual basis.

21 (b) SOURCES OF STUDIES.—The Secretary shall pro22 vide for—

23 (1) one of the studies under subsection (a) to

24 be conducted by one or more Department of Defense

25 organizations designated by the Secretary; and
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1 (2) the other study to be conducted by an orga2 nization that is independent of the Department of

3 Defense and has expertise in financial programs and

4 health care.

5 (c) REPORTS.—(1) The Secretary shall provide for

6 the submission of a final report on each study to the Sec7 retary within such time as the Secretary determines nec8 essary to satisfy the requirement in paragraph (2).

9 (2) The Secretary shall transmit the final reports on

10 the studies to Congress not later than February 8, 2001.

11 The Secretary may include in the transmittal any com12 ments on the reports or on the matters studied that the

13 Secretary considers appropriate.

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