Foundation Health Corporation Wins $1.8 Billion Contract for Managed Care Program

Strategic Insights -

Foundation Health Corporation announced that its government contracts subsidiary, Foundation Health Federal Services, Inc. (FHFS), has been awarded the Department of Defense TRICARE Region 6 Managed Care Support contract valued at approximately $1.8 billion over five years. The contract will provide a comprehensive managed care program for approximately 590,000 eligible beneficiaries of the Civilian Health and Medical Program of the Uniformed Services, or CHAMPUS, in Oklahoma and most of Arkansas, Louisiana, and Texas. The program will enable military families to participate in HMO or PPO programs and pay lower copayments and deductibles when receiving medical care through selected networks of physicians and hospitals.

Key Takeaways:

  • Foundation Health Corporation won the $1.8 billion contract for the TRICARE Region 6 Managed Care Support program, which will serve approximately 590,000 beneficiaries in Oklahoma and most of Arkansas, Louisiana, and Texas.
  • The program will provide a comprehensive managed care program, including HMO and PPO options, and aims to reduce out-of-pocket costs for beneficiaries and maximize the use of existing military resources.
  • The contract is a significant presence in the south-central region for Foundation Health Corporation, which aims to offer commercial, specialty, and government products to penetrate new markets.
  • The program will enable beneficiaries to receive medical care through selected networks of physicians and hospitals, reducing costs and improving access to quality care.
  • The contract implementation period is six months, with delivery of health care services scheduled to begin on November 1, 1995.
  • After a six-month contract implementation period, the contract provides for five annual option periods.
  • Foundation Health Corporation has a long history of managing CHAMPUS programs, with current contracts in Oregon and Washington serving approximately 235,000 beneficiaries.
  • The CHAMPUS program covers dependents of active duty military personnel, including military retirees under age 65 and their dependents.

Statistics:

  • $1.8 billion: The value of the contract over five years.
  • 590,000: The number of eligible beneficiaries of the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) in Oklahoma and most of Arkansas, Louisiana, and Texas.
  • 5 years: The duration of the contract.
  • 6 months: The contract implementation period.
  • November 1, 1995: The start date for delivery of health care services.

Sources:

  • Business Wire - "Foundation Health Corporation Wins $1.8 Billion Contract for Managed Care Program", April 28, 1995
  • Business Wire - Additional information on Foundation Health Corporation and its subsidiaries, including the Department of Defense TRICARE Region 6 Managed Care Support contract.