10 U.S.C. § 1073a — Contracts for health care: best value con-

Page 1019 TITLE 10—ARMED FORCES § 1073a DEFINITIONS Pub. L. 114–328, div. A, title VII, § 701(i), Dec. 23, 2016, 130 Stat. 2190, provided that: ‘‘In this section [enacting sections 1075 and 1075a of this title, amending sections 1072, 1076d, 1076e, 1079a, 1095f, 1099, and 1110b of this title, and enacting provisions set out as notes under this section and sections 1072 and 1099 of this title]: ‘‘(1) The terms ‘uniformed services’, ‘covered bene- ficiary’, ‘TRICARE Extra’, ‘TRICARE for Life’, ‘TRICARE Prime’, and ‘TRICARE Standard’, have the meaning given those terms in section 1072 of title 10, United States Code, as amended by subsection (j). ‘‘(2) The term ‘TRICARE Select’ means the self- managed, preferred-provider network option under the TRICARE program established by section 1075 of such title, as added by subsection (a). ‘‘(3) The term ‘chronic conditions’ includes diabe- tes, chronic obstructive pulmonary disease, asthma, congestive heart failure, hypertension, history of stroke, coronary artery disease, mood disorders, and such other diseases or conditions as the Secretary considers appropriate. ‘‘(4) The term ‘high-value medications and services’ means prescription medications and clinical services for the management of chronic conditions that the Secretary determines would improve health out- comes and create health value for covered bene- ficiaries (such as preventive care, primary and spe- cialty care, diagnostic tests, procedures, and durable medical equipment). ‘‘(5) The term ‘high-value provider’ means an indi- vidual or institutional health care provider that pro- vides health care under the purchased care compo- nent of the TRICARE program and that consistently improves the experience of care, meets established quality of care and effectiveness metrics, and reduces the per capita costs of health care. ‘‘(6) The term ‘value-based health care method- ology’ means a methodology for identifying specific prescription medications and clinical services pro- vided under the TRICARE program for which reduc- tion of copayments, cost shares, or both, would im- prove the management of specific chronic conditions because of the high value and clinical effectiveness of such medications and services for such chronic condi- tions.’’ § 1073a. Contracts for health care: best value con- tracting (a) AUTHORITY.—Under regulations prescribed by the administering Secretaries, health care contracts shall be awarded in the administra- tion of this chapter to the offeror or offerors that will provide the best value to the United States to the maximum extent consistent with furnishing high-quality health care in a manner that protects the fiscal and other interests of the United States. (b) FACTORS CONSIDERED.—In the determina- tion of best value under subsection (a)— (1) consideration shall be given to the fac- tors specified in the regulations; and (2) greater weight shall be accorded to tech- nical and performance-related factors than to cost and price-related factors. (c) APPLICABILITY.—The authority under the regulations prescribed under subsection (a) shall apply to any contract in excess of $5,000,000. (Added Pub. L. 106–65, div. A, title VII, § 722(a), Oct. 5, 1999, 113 Stat. 695.) Statutory Notes and Related Subsidiaries COMPTROLLER GENERAL REVIEW OF DEFENSE HEALTH AGENCY OVERSIGHT OF TRANSITION BETWEEN MAN- AGED CARE SUPPORT CONTRACTORS FOR THE TRICARE PROGRAM Pub. L. 115–232, div. A, title VII, § 737, Aug. 13, 2018, 132 Stat. 1821, provided that: ‘‘(a) BRIEFING AND REPORT ON CURRENT TRANSITION.— ‘‘(1) IN GENERAL.—The Comptroller General of the United States shall provide to the Committees on Armed Services of the Senate and the House of Rep- resentatives a briefing and a report on a review by the Comptroller General of the oversight conducted by the Defense Health Agency with respect to the current transition between managed care support contractors for the TRICARE program. The briefing shall be provided by not later than July 1, 2019. ‘‘(2) ELEMENTS.—The briefing and report under paragraph (1) shall each include the following: ‘‘(A) A description and assessment of the extent to which the Defense Health Agency provided guid- ance and oversight to the outgoing and incoming managed care support contractors for the TRICARE program during the transition described in para- graph (1) and before the start of health care deliv- ery by the incoming contractor. ‘‘(B) A description and assessment of any issues with health care delivery under the TRICARE pro- gram as a result of or in connection with the tran- sition, and, with respect to such issues— ‘‘(i) the effect, if any, of the guidance and over- sight provided by the Defense Health Agency dur- ing the transition on such issues; and ‘‘(ii) the solutions developed by the Defense Health Agency for remediating any deficiencies in managed care support for the TRICARE pro- gram in connection with such issues. ‘‘(C) A description and assessment of the extent to which the Defense Health Agency has reviewed any lessons learned from past transitions between managed care support contractors for the TRICARE program, and incorporated such lessons into the transition. ‘‘(D) A review of the Department of Defense brief- ing provided in accordance with the provisions of the Report of the Committee on Armed Services of the House of Representatives to Accompany H.R. 5515 (115th Congress; House Report 115–676) on TRICARE Managed Care Support Contractor Re- porting. ‘‘(b) REPORT ON FUTURE TRANSITIONS.—Not later than 270 days after the completion of any future transition between managed care support contractors for the TRICARE program, the Comptroller General shall sub- mit to the committees of Congress referred to in sub- section (a)(1) a report on a review by the Comptroller General of the oversight conducted by the Defense Health Agency with respect to such transition. The re- port shall include each description and assessment specified in subparagraphs (A) through (C) of subsection (a)(2) with respect to such transition. ‘‘(c) TRICARE PROGRAM DEFINED.—In this section, the term ‘TRICARE program’ has the meaning given that term in section 1072 of title 10, United States Code.’’ VALUE-BASED PURCHASING AND ACQUISITION OF MAN- AGED CARE SUPPORT CONTRACTS FOR TRICARE PRO- GRAM Pub. L. 118–31, div. A, title VII, § 707, Dec. 22, 2023, 137 Stat. 301, provided that: ‘‘(a) AUTHORITY.—To the extent practicable, the Sec- retary of Defense shall seek to expand the TRICARE Competitive Plans Demonstration Project to not fewer than five locations not later than one year after the date of the enactment of this Act [Dec. 22, 2023]. ‘‘(b) TRICARE COMPETITIVE PLANS DEMONSTRATION PROJECT DEFINED.—In this section, the term ‘TRICARE Page 1020 TITLE 10—ARMED FORCES § 1073a Competitive Plans Demonstration Project’ means the project designed to test the contract acquisition strat- egy of providing an opportunity for local, regional, and national health plans to participate in the competition for managed care support functions under the TRICARE program, in accordance with section 705(c)(3) of the National Defense Authorization Act for Fiscal Year 2017 (Public Law 114–328; 10 U.S.C. 1073a note).’’ Pub. L. 114–328, div. A, title VII, § 705, Dec. 23, 2016, 130 Stat. 2201, as amended by Pub. L. 115–91, div. A, title VII, § 715, Dec. 12, 2017, 131 Stat. 1438; Pub. L. 116–92, div. A, title VII, § 716, Dec. 20, 2019, 133 Stat. 1453, provided that: ‘‘(a) VALUE-BASED HEALTH CARE.— ‘‘(1) IN GENERAL.—The Secretary of Defense shall develop and implement value-based incentive pro- grams as part of any contract awarded under chapter 55 of title 10, United States Code, for the provision of health care services to covered beneficiaries to en- courage health care providers under the TRICARE program (including physicians, hospitals, and other persons and facilities involved in providing such health care services) to improve the following: ‘‘(A) The quality of health care provided to cov- ered beneficiaries under the TRICARE program. ‘‘(B) The experience of covered beneficiaries in re- ceiving health care under the TRICARE program. ‘‘(C) The health of covered beneficiaries. ‘‘(2) VALUE-BASED INCENTIVE PROGRAMS.— ‘‘(A) DEVELOPMENT.—In developing value-based incentive programs under paragraph (1), the Sec- retary shall— ‘‘(i) link payments to health care providers under the TRICARE program to improved per- formance with respect to quality, cost, and reduc- ing the provision of inappropriate care; ‘‘(ii) consider the characteristics of the popu- lation of covered beneficiaries affected by the value-based incentive program; ‘‘(iii) consider how the value-based incentive program would affect the receipt of health care under the TRICARE program by such covered beneficiaries; ‘‘(iv) establish or maintain an assurance that such covered beneficiaries will have timely access to health care during the operation of the value- based incentive program; ‘‘(v) ensure that such covered beneficiaries do not incur any additional costs by reason of the value-based incentive program; and ‘‘(vi) consider such other factors as the Sec- retary considers appropriate. ‘‘(B) SCOPE AND METRICS.—With respect to a value-based incentive program developed and im- plemented under paragraph (1), the Secretary shall ensure that— ‘‘(i) the size, scope, and duration of the value- based incentive program is reasonable in relation to the purpose of the value-based incentive pro- gram; and ‘‘(ii) the value-based incentive program relies on the core quality performance metrics adopted pursuant to section 728 [amending section 1073b of this title and enacting provisions set out as notes under section 1071 of this title]. ‘‘(3) USE OF EXISTING MODELS.—In developing a value-based incentive program under paragraph (1), the Secretary may adapt a value-based incentive pro- gram conducted by a TRICARE managed care support contractor, the Centers for Medicare & Medicaid Services, or any other Federal Government, State government, or commercial health care program. ‘‘(b) EXECUTION OF CONTRACTING RESPONSIBILITY.— With respect to any acquisition of managed care sup- port services under the TRICARE program initiated after the date of the enactment of the National Defense Authorization Act for Fiscal Year 2018 [Dec. 12, 2017], the Under Secretary of Defense for Acquisition and Sustainment shall be responsible for— ‘‘(1) decisions relating to such acquisition; ‘‘(2) approving the acquisition strategy; and ‘‘(3) conducting pre-solicitation, pre-award, and post-award acquisition reviews. ‘‘(c) ACQUISITION OF CONTRACTS.— ‘‘(1) STRATEGY.—Not later than January 1, 2018, the Secretary of Defense shall develop and implement a strategy to ensure that managed care support con- tracts under the TRICARE program entered into with private sector entities— ‘‘(A) improve access to health care for covered beneficiaries; ‘‘(B) improve health outcomes for covered bene- ficiaries; ‘‘(C) improve the quality of health care received by covered beneficiaries; ‘‘(D) enhance the experience of covered bene- ficiaries in receiving health care; and ‘‘(E) lower per capita costs to the Department of Defense of health care provided to covered bene- ficiaries. ‘‘(2) APPLICABILITY OF STRATEGY.— ‘‘(A) IN GENERAL.—The strategy required by para- graph (1) shall apply to all managed care support contracts under the TRICARE program entered into with private sector entities. ‘‘(B) MODIFICATION OF CONTRACTS.—Contracts en- tered into prior to the implementation of the strat- egy required by paragraph (1) shall be modified to ensure consistency with such strategy. ‘‘(3) LOCAL, REGIONAL, AND NATIONAL HEALTH PLANS.—In developing and implementing the strategy required by paragraph (1), the Secretary shall ensure that local, regional, and national health plans have an opportunity to participate in the competition for managed care support contracts under the TRICARE program. ‘‘(4) CONTINUOUS INNOVATION.—The strategy re- quired by paragraph (1) shall include incentives for the incorporation of innovative ideas and solutions into managed care support contracts under the TRICARE program through the use of teaming agree- ments, subcontracts, and other contracting mecha- nisms that can be used to develop and continuously refresh high-performing networks of health care pro- viders at the national, regional, and local level. ‘‘(5) ELEMENTS OF STRATEGY.—The strategy required by paragraph (1) shall provide for the following with respect to managed care support contracts under the TRICARE program: ‘‘(A) The maximization of flexibility in the design and configuration of networks of individual and in- stitutional health care providers, including a focus on the development of high-performing networks of health care providers. ‘‘(B) The establishment of an integrated medical management system between military medical treatment facilities and health care providers in the private sector that, when appropriate, effec- tively coordinates and integrates health care across the continuum of care. ‘‘(C) With respect to telehealth services— ‘‘(i) the maximization of the use of such serv- ices to provide real-time interactive communica- tions between patients and health care providers and remote patient monitoring; and ‘‘(ii) the use of standardized payment methods to reimburse health care providers for the provi- sion of such services. ‘‘(D) The use of value-based reimbursement meth- odologies, including through the use of value-based incentive programs under subsection (a), that transfer financial risk to health care providers and managed care support contractors. ‘‘(E) The use of financial incentives for contrac- tors and health care providers to receive an equi- table share in the cost savings to the Department resulting from improvement in health outcomes for covered beneficiaries and the experience of covered beneficiaries in receiving health care. ‘‘(F) The use of incentives that emphasize preven- tion and wellness for covered beneficiaries receiv- Page 1021 TITLE 10—ARMED FORCES § 1073a ing health care services from private sector entities to seek such services from high-value health care providers. ‘‘(G) The adoption of a streamlined process for en- rollment of covered beneficiaries to receive health care and timely assignment of primary care man- agers to covered beneficiaries. ‘‘(H) The elimination of the requirement for a re- ferral to be authorized prior receiving specialty care services at a facility of the Department of De- fense or through the TRICARE program. ‘‘(I) The use of incentives to encourage covered beneficiaries to participate in medical and lifestyle intervention programs. ‘‘(6) RURAL, REMOTE, AND ISOLATED AREAS.—In de- veloping and implementing the strategy required by paragraph (1), the Secretary shall— ‘‘(A) assess the unique characteristics of pro- viding health care services in Alaska, Hawaii, and the territories and possessions of the United States, and in rural, remote, or isolated locations in the contiguous 48 States; ‘‘(B) consider the various challenges inherent in developing robust networks of health care providers in those locations; ‘‘(C) develop a provider reimbursement rate struc- ture in those locations that ensures— ‘‘(i) timely access of covered beneficiaries to health care services; ‘‘(ii) the delivery of high-quality primary and specialty care; ‘‘(iii) improvement in health outcomes for cov- ered beneficiaries; and ‘‘(iv) an enhanced experience of care for covered beneficiaries; and ‘‘(D) ensure that managed care support contracts under the TRICARE program in those locations will— ‘‘(i) establish individual and institutional pro- vider networks that will provide timely access to care for covered beneficiaries, including pursuant to such networks relating to an Indian tribe or tribal organization that is party to the Alaska Native Health Compact with the Indian Health Service or has entered into a contract with the Indian Health Service to provide health care in rural Alaska or other locations in the United States; and ‘‘(ii) deliver high-quality care, better health outcomes, and a better experience of care for cov- ered beneficiaries. ‘‘(d) REPORT PRIOR TO CERTAIN CONTRACT MODIFICA- TIONS.—Not later than 60 days before the date on which the Secretary of Defense first modifies a contract awarded under chapter 55 of title 10, United States Code, to implement a value-based incentive program under subsection (a), or the managed care support con- tract acquisition strategy under subsection (c), the Secretary shall submit to the Committees on Armed Services of the Senate and the House of Representa- tives a report on any implementation plan of the Sec- retary with respect to such value-based incentive pro- gram or managed care support contract acquisition strategy. ‘‘(e) COMPTROLLER GENERAL REPORT.— ‘‘(1) IN GENERAL.—Not later than 180 days after the date on which the Secretary submits the report under subsection (d), the Comptroller General of the United States shall submit to the Committees on Armed Services of the Senate and the House of Representa- tives a report that assesses the compliance of the Secretary of Defense with the requirements of sub- section (a) and subsection (c). ‘‘(2) ELEMENTS.—The report required by paragraph (1) shall include an assessment of the following: ‘‘(A) Whether the approach of the Department of Defense for acquiring managed care support con- tracts under the TRICARE program— ‘‘(i) improves access to care; ‘‘(ii) improves health outcomes; ‘‘(iii) improves the experience of care for cov- ered beneficiaries; and ‘‘(iv) lowers per capita health care costs. ‘‘(B) Whether the Department has, in its require- ments for managed care support contracts under the TRICARE program, allowed for— ‘‘(i) maximum flexibility in network design and development; ‘‘(ii) integrated medical management between military medical treatment facilities and net- work providers; ‘‘(iii) the maximum use of the full range of tele- health services; ‘‘(iv) the use of value-based reimbursement methods that transfer financial risk to health care providers and managed care support contrac- tors; ‘‘(v) the use of prevention and wellness incen- tives to encourage covered beneficiaries to seek health care services from high-value providers; ‘‘(vi) a streamlined enrollment process and timely assignment of primary care managers; ‘‘(vii) the elimination of the requirement to seek authorization for referrals for specialty care services; ‘‘(viii) the use of incentives to encourage cov- ered beneficiaries to engage in medical and life- style intervention programs; and ‘‘(ix) the use of financial incentives for contrac- tors and health care providers to receive an equi- table share in cost savings resulting from im- provements in health outcomes and the experi- ence of care for covered beneficiaries. ‘‘(C) Whether the Department has considered, in developing requirements for managed care support contracts under the TRICARE program, the fol- lowing: ‘‘(i) The unique characteristics of providing health care services in Alaska, Hawaii, and the territories and possessions of the United States, and in rural, remote, or isolated locations in the contiguous 48 States; ‘‘(ii) The various challenges inherent in devel- oping robust networks of health care providers in those locations. ‘‘(iii) A provider reimbursement rate structure in those locations that ensures— ‘‘(I) timely access of covered beneficiaries to health care services; ‘‘(II) the delivery of high-quality primary and specialty care; ‘‘(III) improvement in health outcomes for covered beneficiaries; and ‘‘(IV) an enhanced experience of care for cov- ered beneficiaries. ‘‘(f) DEFINITIONS.—In this section: ‘‘(1) The terms ‘covered beneficiary’ and ‘TRICARE program’ have the meaning given those terms in sec- tion 1072 of title 10, United States Code. ‘‘(2) The term ‘high-performing networks of health care providers’ means networks of health care pro- viders that, in addition to such other requirements as the Secretary of Defense may specify for purposes of this section, do the following: ‘‘(A) Deliver high quality health care as measured by leading health quality measurement organiza- tions such as the National Committee for Quality Assurance and the Agency for Healthcare Research and Quality. ‘‘(B) Achieve greater efficiency in the delivery of health care by identifying and implementing within such network improvement opportunities that guide patients through the entire continuum of care, thereby reducing variations in the delivery of health care and preventing medical errors and du- plication of medical services. ‘‘(C) Improve population-based health outcomes by using a team approach to deliver case manage- ment, prevention, and wellness services to high- need and high-cost patients. Page 1022 TITLE 10—ARMED FORCES § 1073b ‘‘(D) Focus on preventive care that emphasizes— ‘‘(i) early detection and timely treatment of disease; ‘‘(ii) periodic health screenings; and ‘‘(iii) education regarding healthy lifestyle be- haviors. ‘‘(E) Coordinate and integrate health care across the continuum of care, connecting all aspects of the health care received by the patient, including the patient’s health care team. ‘‘(F) Facilitate access to health care providers, including— ‘‘(i) after-hours care; ‘‘(ii) urgent care; and ‘‘(iii) through telehealth appointments, when appropriate. ‘‘(G) Encourage patients to participate in making health care decisions. ‘‘(H) Use evidence-based treatment protocols that improve the consistency of health care and elimi- nate ineffective, wasteful health care practices.’’ § 1073b. Recurring reports and publication of certain data (a) ANNUAL REPORT ON RECORDING OF HEALTH ASSESSMENT DATA IN MILITARY HEALTH RECORDS.—The Secretary of Defense shall issue each year a report on the compliance by the military departments with applicable law and policies on the recording of health assessment data in military health records, including com- pliance with section 1074f(c) of this title. The re- port shall cover the calendar year preceding the year in which the report is submitted and in- clude a discussion of the extent to which immu- nization status and predeployment and postdeployment health care data are being re- corded in such records. (b) PUBLICATION OF DATA ON PATIENT SAFETY, QUALITY OF CARE, SATISFACTION, AND HEALTH OUTCOME MEASURES.—(1) The Secretary of De- fense shall publish on a publically available Internet website of the Department of Defense data on all measures that the Secretary con- siders appropriate that are used by the Depart- ment to assess patient safety, quality of care, patient satisfaction, and health outcomes for health care provided under the TRICARE pro- gram at each military medical treatment facil- ity. Such data shall include the core quality per- formance metrics adopted by the Secretary under section 728 of the National Defense Au- thorization Act for Fiscal Year 2017. (2) The Secretary shall publish an update to the data published under paragraph (1) not less frequently than once each quarter during each fiscal year. (3) The Secretary may not include data relat- ing to risk management activities of the Depart- ment in any publication under paragraph (1) or update under paragraph (2). (4) The Secretary shall ensure that the data published under paragraph (1) and updated under paragraph (2) is accessible to the public through the primary Internet website of the Department and the primary Internet website of the military medical treatment facility with respect to which such data applies. (Added Pub. L. 108–375, div. A, title VII, § 739(a)(1), Oct. 28, 2004, 118 Stat. 2001; amended Pub. L. 114–92, div. A, title VII, § 712, Nov. 25, 2015, 129 Stat. 864; Pub. L. 114–328, div. A, title VII, § 728(b)(1), Dec. 23, 2016, 130 Stat. 2234; Pub. L. 115–91, div. A, title X, §§ 1051(a)(5), 1081(d)(3), Dec. 12, 2017, 131 Stat. 1560, 1600.) Editorial Notes REFERENCES IN TEXT Section 728 of the National Defense Authorization Act for Fiscal Year 2017, referred to in subsec. (b)(1), is section 728 of Pub. L. 114–328, which amended this sec- tion and enacted provisions set out as notes under sec- tion 1071 of this title. AMENDMENTS 2017—Pub. L. 115–91, § 1081(d)(3), amended directory language of Pub. L. 114–328, § 728(b)(1). See 2016 Amend- ment notes below. Subsecs. (a) to (c). Pub. L. 115–91, § 1051(a)(5), redesig- nated subsecs. (b) and (c) as (a) and (b), respectively, and struck out former subsec. (a) which related to an- nual report on the Force Health Protection Quality As- surance Program. 2016—Pub. L. 114–328, § 728(b)(1)(B), as amended by Pub. L. 115–91, § 1081(d)(3), inserted ‘‘and publication of certain data’’ after ‘‘reports’’ in section catchline. Amendment was executed as the probable intent of Congress, notwithstanding directory language amend- ing the section heading of section ‘‘1073b(c)’’. Subsec. (c)(1). Pub. L. 114–328, § 728(b)(1)(A), as amend- ed by Pub. L. 115–91, § 1081(d)(3), substituted ‘‘The Sec- retary’’ for ‘‘Not later than 180 days after the date of the enactment of the National Defense Authorization Act for Fiscal Year 2016, the Secretary’’ and inserted at end ‘‘Such data shall include the core quality perform- ance metrics adopted by the Secretary under section 728 of the National Defense Authorization Act for Fis- cal Year 2017.’’ 2015—Subsec. (c). Pub. L. 114–92 added subsec. (c). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2017 AMENDMENT Pub. L. 115–91, div. A, title X, § 1081(d), Dec. 12, 2017, 131 Stat. 1599, provided that the amendment made by section 1081(d)(3) is effective as of Dec. 23, 2016, and as if included in Pub. L. 114–328 as enacted. INCLUSION OF DENTAL CARE For purposes of amendment by Pub. L. 108–375 adding this section, references to medical readiness, health status, and health care to be considered to include den- tal readiness, dental status, and dental care, see sec- tion 740 of Pub. L. 108–375, set out as a note under sec- tion 1074 of this title. INITIAL REPORTS Pub. L. 108–375, div. A, title VII, § 739(a)(3), Oct. 28, 2004, 118 Stat. 2002, directed that the first reports under this section be completed not later than 180 days after Oct. 28, 2004. § 1073c. Administration of Defense Health Agency and military medical treatment facilities (a) ADMINISTRATION OF MILITARY MEDICAL TREATMENT FACILITIES.—(1) In accordance with paragraph (5), by not later than September 30, 2021, the Director of the Defense Health Agency shall be responsible for the administration of each military medical treatment facility, in- cluding with respect to— (A) provision and delivery of health care within each such facility; (B) management of privileging, scope of practice, and quality of health care provided within each such facility; (C) budgetary matters;