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TriWest Statement Regarding GAO Contract Decision

7/2/2012

PHOENIX — The U.S. Government Accountability Office (GAO) announced today that it has denied TriWest Healthcare Alliance’s protest of the award of the TRICARE West Region T-3 Contract to a subsidiary of UnitedHealthcare.

The award of the contract in March 2012 to UnitedHealthcare was a re-bid of the contract TriWest initially won in July 2009. TriWest was the only incumbent contractor to initially be awarded a T-3 Contract.

“Given our 16-year long commitment to providing access to care for military families across the West Region, we are extremely disappointed by the GAO’s findings regarding our protest,” stated TriWest President and CEO David J. McIntyre, Jr. “We will be discussing this decision with our company’s owners and the counsel who represent us, and will, in turn, be making a decision on what, if any, action we will take in response to the GAO’s denial of our protest.” 

Media Contact

Scott Celley: 602-564-2526; 602-770-2131

Earlier this year, TriWest filed a protest with the GAO regarding the Department of Defense’s decision to award the TRICARE West Region T-3 Contract to a UnitedHealthcare affiliate. In its protest, TriWest identified a variety of concerns that the government’s decision in awarding the contract was the result of a flawed and unfair process. TriWest’s grounds of protest included:

  • The government failed to conduct a sufficient and reasonable evaluation of UnitedHealthcare’s proposal, the risks that it poses to the military health care program, and United’s extensive track record of problems with consumers, providers, beneficiaries and government enforcement agencies.
  • The government reached an erroneous Best Value decision. TriWest’s price was significantly lower than UnitedHealthcare’s price, and the agency disregarded hundreds of millions of dollars in healthcare cost savings guaranteed by TriWest.
  • The government failed to consider the substantial risks presented by UnitedHealth’s proposal, given that UnitedHealthcare has no experience in military healthcare management. TriWest has been exclusively focused on supporting the health care needs of America’s military families since its inception 16 years ago. The agency failed to adequately analyze the areas where transition risk might negatively impact beneficiaries and providers, and how to sufficiently avoid the negative past history of transitions from one TRICARE contractor to the next. In particular, the agency failed to conduct a meaningful analysis of United’s transition-in proposal. Given the significant disruption, it may cost the government and taxpayers hundreds of millions of dollars simply to change contractors.

The details regarding GAO’s decision to deny TriWest’s protest have not yet been publicly released. 

TriWest currently serves 2.9 million beneficiaries—including active duty personnel, retirees and their families – and has more than 175,000 health care providers in its 21-state network. The current TRICARE contract continues through March 31, 2013.

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