Triwest closes as contract ends
Unitedhealth to handle military health benefits in West
TriWest Healthcare Alliance employees are processing their last medical billing codes and their final payments on behalf of military families.
Phoenix-based TriWest Healthcare Alliance will shut down operations at the close of business today as UnitedHealth Group takes over the lucrative military health-benefits contract for the Western United States. TriWest representatives estimate 1,200 to 1,300 positions will be eliminated because the company’s entire business is tied to the Department of Defense Tricare contract.
On Monday, UnitedHealthcare Military and Veterans will begin a $20.5 billion contract to manage health benefits for military personnel and their fam- ilies in 20 West region states and part of Texas.
Although UnitedHealthcare Military and Veterans is based in Minnetonka, Minn., the company will maintain a large office in Phoenix to service the military-benefits business. The company now employs 660 in Phoenix and plans to increase its staffing to 750 by mid-April, said Bruce Jasurda, vice president of communications for UnitedHealthcare Military and Veterans.
Jasurda said UnitedHealthcare has hired a substantial number of TriWest workers, but he said he was not immediately able to provide an exact figure.
TriWest has held the contract since 1996; it won an extension in 2009. The contract was rebid after UnitedHealthcare challenged the award to TriWest, and the Department of Defense selected UnitedHealthcare for the six-year contract that begins Monday.
Scott Celley, TriWest’s vice president of external relations, said the company has continued to service the contract while sharing information with UnitedHealthcare to ease the transition. Celley said TriWest leaders are exploring the possibility of continuing the business and submitting bids for new benefits-related contracts, but no firm plans have been announced about the company’s future.
The Tricare contract serves nearly 3 million military families and retirees, and veterans groups said they will monitor the contract switch closely to ensure things run smoothly.
“Every transition brings issues,” said Joyce Wessel Raezer, executive director of the National Military Family Association, an Alexandria, Va-based non-profit servicing military families. “There is always going to be some disruption.”
Parts of the switch are already under way. In February, UnitedHealthcare assumed control of more than 80 Tricare service centers located mainly at military and National Guard bases across the West. Military members can access these cen- ters for health information, services and other benefits-related dealings.
Jasurda said the two companies also have jointly managed enrollment services for military families recently.
Still, there could be some ripples for a number of people. About 8,000 people may need to switch doctors or other health providers because their providers will not be part of UnitedHealthcare’s network. About 1,000 of those military members will be assigned to military health-care facilities, Jasurda said.
Raezer said that the Tricare military health program has made improvements to ensure service is not disrupted. For example, women who are pregnant are allowed to stay with their existing doctor through the term of the pregnancy.
Another sensitive area in- cludes families and children with special needs such as autism. These families typically have a case manager assigned to handle the complex health needs, but Jasurda said there will be a “person-to-person hand off” for these cases.
Raezer said that many military family members didn’t expect the Defense Department to switch contractors, and she said military families will expect UnitedHealthcare to provide service comparable to TriWest’s.
“I haven’t received complaints from beneficiaries in the West region for a long time,” Raezer said. “One of the things you learn in the military, you salute smartly and move on.”