Summary

GAO commends the Defense Department (DOD) for moving toward managed health care because GAO continues to believe that this approach, while not a panacea, does offer the potential for controlling costs, improving beneficiary access, and offering high-quality care. Important lessons have been learned about features that need to be in place as DOD's managed care efforts continue. These include the need for (1) uniform health care benefits and cost-sharing requirements within individual categories of beneficiaries, (2) organization and budgeting systems that provide managers the appropriate incentives to manage beneficiaries' care efficiently, and (3) consideration of a variety of factors as DOD continues to contract for health care services.