Defense Health Care

This report provides information on Defense Department procedures used to reassign personnel with disabled children, who often have special educational or therapy needs. GAO discusses (1) whether disproportionate numbers of personnel who have children with disabilities are transferred inappropriately to military bases in some states, such as Washington; and (2) the status of efforts to resolve disputes that have arisen between the Civilian Health and Medical Program of the Uniformed Services and the states over who should pay for services provided to these children.

GAO found that: (1) there was no evidence that DOD encouraged personnel with disabled children to transfer to states or communities with more extensive services for such children in order to reduce CHAMPUS costs; (2) disproportionate transfers are likely to occur because of efforts to balance the military's need for certain specialties with military personnel's desire to be assigned to a location that can best meet their child's special needs; (3) two DOD task forces have been attempting to develop a long-term resolution to a dispute over which health care programs should be the primary payer for medical services provided to military personnel's disabled children; (4) in Washington in 1989, two major civilian providers threatened to stop delivering services to CHAMPUS beneficiaries until CHAMPUS, Medicaid, or the Maternal and Child Health Block Grant agreed to pay them, but all of the programs refused to pay for the services, each claiming to be secondary to one of the other programs; and (5) to temporarily resolve the problem, the Army directed its major medical center serving disabled children to use facility funds to pay for services already provided, CHAMPUS made administrative changes to pay first for children who were Medicaid-enrolled, and CHAMPUS and state officials worked out interim administrative changes to ensure that services were provided until a permanent solution was reached.