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For a number of reasons, military beneficiaries — active-duty service members, military retirees, and their dependents — are heavier users of medical care than are comparable civilian populations. These services are currently provided by military treatment facilities (MTFs) or the civilian medical facilities, the latter through the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS). However, over the past several years, the system has faced the twin challenges of downsizing in consonance with the rest of the Department of Defense and of controlling escalating health care costs. While care provided in the civilian sector can be more expensive than that provided in the MTFs, the free care available in MTFs sparks greater demand. Moreover, the MTF system was designed to meet wartime, rather than peacetime needs. In weighing the pros and cons of various alternatives, this report suggests that beneficiaries might prefer civilian health plans, as long as there is no erosion of benefits in making such a shift.

Table of Contents

  • Chapter One

    Introduction

  • Chapter Two

    Structure of the Current Military Health Services System

  • Chapter Three

    Health Care Utilization in the MHSS

  • Chapter Four

    Analytic Cases Developed to Study Demand in the MHSS

  • Chapter Five

    The Effects of Changes in the MHSS on Health Care Demand

  • Chapter Six

    Utilization and Costs in Cases with Commercial Health Plans

  • Chapter Seven

    Conclusions

  • Appendix A

    Survey Weights

  • Appendix B

    Military/Civilian Utilization Comparisons: Data and Methods

  • Appendix C

    Regression Methods for Predicting Demand in Alternative Systems

  • Appendix D

    Adjustments to MTF Utilization Estimates for Costing by IDA

  • Appendix E

    Analyses to Predict MTF Utilization and Civilian Costs for Cases 3 and 4

The research described in this report was sponsored by the Office of the Secretary of Defense under RAND's National Defense Research Institute, a federally funded research and development center supported by the Office of the Secretary of Defense, the Joint Staff, and the defense agencies.

This report is part of the RAND Corporation monograph report series. The monograph/report was a product of the RAND Corporation from 1993 to 2003. RAND monograph/reports presented major research findings that addressed the challenges facing the public and private sectors. They included executive summaries, technical documentation, and synthesis pieces.

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