Tricare Philippines Newsletter 14001
A comparison of medical care plans, what could be vs. the DHA agenda
In an article in The Journal of Public Inquiry entitled TRICARE Overseas Program (TOP) Fraud the author provides a good primer on the failures of the former TRICARE Management Activity (TMA), now the Defense Health Agency (DHA), in properly reacting to fraud and how they came under intense fire by government entities and Congress. It also discusses the basics of a mandated working group formed to assist TMA in resolving these issues. One option recommended to TMA by the other participants was for TMA to partner with a local health maintenance group and use their network of providers and negotiated reasonable fees. The other participants saw this as a reasonable solution that would resolve the fraud issues while not causing the significant access to care problems we encounter under TMA’s solutions. But the DHA organizational culture resists this change in favor of building their own system which continues to use the previously implemented programs such as their TOP contractor, CMAC and provider certification processes. They are apparently willing to expend additional millions in tax dollars, including compromises in integrity to try to insure “their” solution survives. The continued loss of reasonable access to care doesn’t appear to be a concern either. See A Conflict of Interest and Favoritism Exposed
, Deliberate Overcharges under the Demonstration (Closed Network) and Elimination of the TRICARE Medical Benefit.
The article in The Journal of Public Inquiry brings to light issues involving TMA’s “Organizational Culture” and what happens when organizations with traditional hierarchical structure come under attack and “outsiders” attempt to offer solutions. This helps explain what has happened to us. See Barriers to Change for a more in-depth discussion.
The result of this cultural effect was the development of the “TRICARE Demonstration Project for the Philippines” in its present form instead of a cheaper and more realistic partnership with a local national health care group.
Let’s do a comparison of the DHA solution and the solution offered by everyone else. We will do that by addressing DHA’s own list of expectations/advantages[i] to their option and compare the reality between the two. For comparison we will use some examples from Maxicare although there are many similar national groups.
Control Cost (eliminating balance billing and ensure billing practices comply with regulatory requirements.)
Demo – Visits are charged at 2 to 5 times normal local rates. Ancillary fees are increased by as much as 2 times normal local rates as are inpatient fees. This is done with the full consent and direction of International SOS (ISOS) and DHA. Claims by DHA that the CMAC will prevent these increases are false. We have multiple examples of Demo filed claims where DHA pays “Billed Charges” instead of using the CMAC but when the same beneficiary pays for similar care and files a claim the CMAC is applied and a significant portion of the billed amount is disallowed for the retiree.
One example; a retiree obtained a CT of the Pelvis with dye, CPT code 72193. The CMAC allowed amount is $200 making the copay $50. DHA paid the claim using CPT code 99499, Unlisted Evaluation and Management Service or in layman’s terms a non-standard physician office visit. Being “non-standard” there is no CMAC allowed amount so billed charges are paid. The billed amount from the Demo provider for this CT scan was $595. Using this code DHA allowed the full billed amount and paid the claim as such. The retiree’s copay went from $50 to $148.75. Anyone receiving a Demo EOB where hospital charges are paid using 99499 – MEDICAL OFFICE or 99070 – MEDICAL SUPPLIES should contact us at email@example.com
All of this is in direct violation of TRICARE policy. All Demo providers are required per the DODIG and agreed to by DHA to sign an agreement that states the provider agrees to comply with the provisions of Title 32, Code of Federal Regulations, Section 199.9 that says in part, “(2) Improper billing practices. Examples include, charging CHAMPUS beneficiaries rates for services and supplies that are in excess of those charges routinely charged by the provider to the general public, commercial health insurance carriers, or other federal health benefit entitlement programs for the same or similar services.”
This alone shows that DHA is willing to go to any lengths and get in bed with anyone to force “their” solution on the Philippines. It also clearly shows, as any beneficiary who has been forced to use the Demo knows, the cost to beneficiaries and the taxpayer is considerably higher.
Bottom line the cost of care to the beneficiary and the taxpayer under the Demo is significantly higher than what local patients and health insurance programs pay for the same care. See endnote[ii] for more detailed information.
Local Medical Plan – A contract with a local HMO/PPO that provided the typical TRICARE benefit would result in lower costs. Most local insurance programs obtain discounts of up to 20% from physicians and 10% from hospitals. Worst case, physician fees paid are the same as paid by all local patients, not 2 to 5 times higher. This was also confirmed through multiple interviews with local HMO/PPO organizations and private physicians. Beneficiaries would see the HMO/PPO providers, pay their discounted copay and not worry about claims.
Beneficiaries will pay only their TRICARE annual deductible and cost-share amounts.
Demo – While this is partially true in the limited Demo areas it does not apply to the large number of exceptions under the Demo and because of cost increases orchestrated by ISOS they are higher than they should be. Most specialties are excluded from the Demo. If admitted and the hospital doesn’t care to purchase supplies your physician orders, the Demo requires you go out, find a Certified supplier and pay cash; then submit a claim and hope to be reimbursed. If the hospital claims a room with 4 patients and 4 watchers that shares a bathroom with 30 people is “Semi-Private”, you will be required to pay in full to obtain the normal industry standard room in the Philippines. If you have PhilHealth you may be required to pay for your entire episode of care and file your own claim as outlined above. There are no requirements for a provider to file a claim when paid in full by your deductible and multiple providers have said they will not file these claims; you may never get credit for your deductible. Some Demo hospitals require large deposits before they will agree to allow you to use the facility. See endnote[iii] for more detailed explanations.
Local Medical Plan – Per conversations with local HMO/PPO groups all medical benefits specified in the plan are covered and beneficiaries are not required to routinely purchase their own care. In the rare event a provider is not part of their program in an area they will negotiate with the provider and attempt to pay for the care. If that is not possible they will reimburse the beneficiary for the cost of care as long as the care is part of the benefit package and receipts are provided. PhilHealth is accepted by their hospitals without question. The local industry standard of a basic private room is covered and no deposits are required.
Beneficiaries may only use providers on the Approved list.
Demo – Because of how DHA built the Demo and those they hired to administer it, “Approved” providers are extremely limited and in many instances limited to a single provider. Not only does this pose significant quality of care and access to care issues within the limited Demo areas it is also a blatant violation of TRICARE’s published Patient Rights policy which clearly states, “As a patient in the Military Health System, you have the right to: Your choice of health care providers”. A single physician or hospital does not constitute choice but again shows that DHA is willing to go to any lengths including sacrificing beneficiary rights in order to force their “agenda” on the Philippines. Experience shows that without notice entire cities under the Demo can be without approved providers overnight. Angeles arguably has the largest concentration of beneficiaries in the Philippines yet the Demo offers a measly 35 providers.
Local Medical Plan – Local plans offer hundreds of times the number of providers and do so at lower cost and virtually everywhere in the Philippines, not just the 2% of the country covered by the DHA Demo.
Examples of typical available providers between Maxicare and the Demo
The difference is regardless of where you are in the Philippines when you need medical care a beneficiary would have access to the same plan and not have to revert between two distinctly different plans when crossing artificial boundaries. Regardless of what DHA claims, all beneficiaries need to maintain $10,000 or more in order to pay for care that is not available under the DHA demo. See endnote[iv] for more explanation.
When sufficient  providers cannot be recruited in a specialty TRICARE will revert to “Pay as You Go” and the beneficiary files claims.
Demo – The Demo is limited to less than 2% of the Philippines. At most 60% of the beneficiary population lives in this area and is covered under the Demo, but only part time. Even within these small boundaries beneficiaries find that the majority of specialties are not covered since DHA and ISOS can find no providers willing to get involved due to their bad reputations. Additionally what is Demo and what isn’t constantly changes so one has to stay glued to their computer for the latest updates as to which physician came or went this week. See endnote[v].
Local Medical Plan – Under any of the typical local national health plans, Blue Cross, Insular, Intellicare, Maxicare, PhilCare, Health First and many more, virtually all specialties available at any location are included. You get one plan; no mix and matching.
Access to providers who deliver quality medical care
Demo – DHA and ISOS like to throw statements around like “access to providers who deliver high-quality medical care” when toting their Demo. Words mean nothing unless backed up by fact and the fact is there are virtually no quality checks done on Demo or certified providers. The Real Story is there are no quality checks on providers overseas. According to the DODIG certification is done to ensure that the provider exists, has the capability to perform the billed services and the provider is legitimate and accredited. This is done by physically confirming the existence of the provider’s establishment, confirming that the provider is licensed with the appropriate Philippine agency and verify they have the necessary equipment, supplies and staff to perform the services they are licensed to perform; nothing more. The provider is also required to sign a statement certifying that they fully understand the requirements in Title 32, Code of Federal Regulations, Section 199.9, which in part states, “(2) Improper billing practices. Examples include, charging CHAMPUS beneficiaries rates for services and supplies that are in excess of those charges routinely charged by the provider to the general public, commercial health insurance carriers, or other federal health benefit entitlement programs for the same or similar services. (This includes dual fee schedules—one for CHAMPUS beneficiaries and one for other patients or third-party payers.)” Not a word is mentioned regarding quality assurance. In addition approved Demo providers are selected based on quality/accurate claims submissions/cost and agree to collect deductibles and copays and file claims for reimbursement.
Below are pictures from a certified and approved Demo hospital that meets all the “quality” standards.
At another of these certified and approved hospitals we witnessed “quality” in the Operating Suite while waiting for another patient when we observed various people enter the operating area in civilian clothes carrying food and sodas in violation of posted sterile policy. Gloves are seldom used and sterile technique is ignored in “quality” Demo hospitals when blood is drawn or IVs inserted. See endnote for more detail[vi].
Local Medical Plan – While local plans don’t offer any better quality assurance as to the quality and abilities of their physicians and hospitals, they do allow a substantially larger selection and in most cases virtually offer every legitimate licensed provider in an area, unlike the Demo that often only offers one (1) provider. This allows the patient to select a better quality provider. In addition DHA and ISOS deny access to some internationally accredited Philippine hospitals (JCI), the Red Cross and many legitimate pharmacies. All local health plans allow you to use these providers including facilities that meet standards comparable to the U.S.[vii]
Coverage area of the plan
Demo – DHA likes to claim “After it's fully implemented, the network will include most of the 11,000 military beneficiaries in the country and could become a model for DHA overseas insurance coverage elsewhere.” and did so even after a massive withdrawal of providers, most of which will not return. The reality is less than 2% of the country will be under the demo as shown by this map. Their claims are based on a flawed study that couldn’t even get country populations right; let alone where beneficiaries live in the Philippines. This map shows the actual distribution. In reality at most about 60% of the population will be covered by this plan and then only when they are physically within the 2% of the country where it applies or an exception isn’t in place.
Local Medical Plan – National Philippine plans offer coverage in virtually every province and city and in many towns making plan providers available almost anywhere in the Philippines.
The Demonstration offers expensive and extremely limited coverage. Outside the limited areas covered by the Demo and extensive exceptions to its use even within these limited areas, beneficiaries still pay for 100% of their care and file claims and are still required to be coders and claims processors to convert inpatient professional fee bills; even while DHA hires claims processors to do this for Demo physicians. A local medical plan would increase access to care, provide better coverage across the entire Philippines, reduce cost to the beneficiary and taxpayer and eliminate the requirement for beneficiaries to convert inpatient professional fee bills. The single uniform plan would also dramatically increase beneficiary satisfaction and eliminate the cost to DHA to recreate local certification and a fee schedule. It’s time for DHA to get past their “Organizational Culture” road block and do the right thing!
As we gather more information from DHA, the contractor and beneficiaries we will continue to send out newsletters but generally not more than once a month.
What we continue to see is rapidly put together policy that sometimes changes within a few days only to be changed again. These in turn raise new issues or other unforeseen problems surface. To keep up with these we will post shorter topic specific updates and notices on our blog, TRICARE Overseas Philippines Blog. Recommend those interested in keeping informed on Philippine TRICARE Standard and the Demonstration check it frequently or alternately add your email address and click “Follow” about midway down the front page and on the right. This will automatically email you a link to each new entry.
Previous Newsletters can be accessed by going to U.S. Military Retirees of the Philippines Group TRICARE Newsletter Archive
Share this newsletter with other beneficiaries
Forward this newsletter to others you feel might benefit from them so they can sign up as well. If you represent an RAO or service organization let your members know so they can sign up. Sign up link
[vii] While South Star Pharmacy and Manson Drug are well known licensed and legitimate pharmacy chains in the Philippines they are not considered genuine by ISOS and DHA. Chong Hua Hospital in Cebu, considered world class by anyone else is not considered a legitimate hospital while those pictured above are and meet TRICARE’s “high quality” standards. In addition the Philippine National Red Cross is also not considered legitimate to provide blood and blood products.