Congress is grappling with the thorny question of how big the military's healthcare force should be, and the debate potentially could have major effects on private-sector providers.
If Congress responds to calls to cut military medical strength in half, private-sector providers could see a windfall because the Department of Defense could send those providers more active-duty troops, as well as beneficiaries and retirees insured by the Civilian Health and Medical Program of the Uniformed Services, or CHAMPUS (See related story, p. 36).
The $9.9 billion defense health program provides care for 8.2 million active-duty personnel and beneficiaries. Some military medical officials say more private-sector contracting will increase the program's cost.
The debate, which has spilled over from the Pentagon into Congress, focuses on the military's ability to treat wounded soldiers in wartime. At issue is whether military providers' chief mission should be preparing for wartime casualties or peacetime care.
Although the military shrank by more than one-fifth between 1987 and 1994, the number of active-duty and reserve physicians rose 2% to 19,479.
But military healthcare officials insist that to keep their doctors skilled enough to treat the wounded of two simultaneous major regional wars, they must maintain a force of more than 12,000 active-duty physicians who can treat soldiers, their families and retirees in peacetime.
"There are two ways to kill this system," said Stephen C. Joseph, M.D., assistant defense secretary for health affairs. "One is to cut it too much, and the other is to separate our twin missions of wartime and peacetime (care)."
But some analyses of military healthcare take a different view.
One study concluded that the military medical force planned for 1999 is twice as large as needed for wartime readiness, even though it will continue to be too small to meet peacetime demands.
In addition, some question whether peacetime healthcare trains military doctors well enough to treat wartime casualties. The military Joint Chiefs of Staff have reported that many doctors who served in the Persian Gulf War were ill-prepared for trauma care. And the Congressional Budget Office says only 5% of the cases military doctors handle in peacetime match those they would encounter in wartime, meaning they get little practice for battle casualties.
Furthermore, the CBO argues that the Department of Defense's recent moves to farm out more retirees to private-sector providers through Tricare, CHAMPUS' managed-care initiative, will only add to readiness problems.
The CBO proposes an alternative strategy that could achieve the twin goals of reducing the military medical force to wartime strength and honing physicians' trauma skills. It suggests rotating military doctors through hospital shock trauma centers, as two base hospitals now do, to give the doctors experience in conditions similar to those of a battlefield. Such units treat traffic accidents, shootings and other serious injuries.
The CBO acknowledges, however, that such a proposal could constrain the military's ability to treat soldiers in peacetime. To provide such care, it says, the Pentagon could consider more contracting with private-sector providers.
The CBO cites one finding that if wartime readiness is the military medical system's chief goal, it could reduce its system of 124 hospitals and 18,000 beds to just 11 hospitals and 5,500 beds.
Under such a proposal, two-thirds of active-duty soldiers and officers would seek inpatient care from private providers-at a cost of no more than $3 billion-while retirees, their dependents and dependents of active-duty personnel would be treated by private providers through such arrangements as the Federal Employees Health Benefit program, the CBO said.
Right now, about 75% of the military's healthcare is provided through base facilities, officials said.