[Federal Register Volume 70, Number 168 (Wednesday, August 31, 2005)]
[Proposed Rules]
[Pages 51692-51694]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-17299]


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DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Part 199

RIN 0720-AA92


TRICARE; Revision of Participating Providers Reimbursement Rate; 
TRICARE Dental Program (TDP)

AGENCY: Office of the Secretary, DoD.

ACTION: Proposed rule.

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SUMMARY: The Department is publishing this proposed rule to revise the 
requirements and procedures for the reimbursement of TRICARE Dental 
Program participating providers. Participating providers will no longer 
be reimbursed at the equivalent of a percentile of prevailing charges 
sufficiently above the 50th percentile of prevailing charges made for 
similar services in the same locality (region) or state, or the 
provider's actual charge, whichever is lower, less any cost-share 
amount due for authorized services. Specifically, the revision will 
require TRICARE Dental Program participating providers to be reimbursed 
in accordance with the contractor's network agreements, less any cost-
share amount due for authorized services.
    Public comments are invited and will be considered for possible 
revisions to the final rule.

DATES: Written comments received at the address indicated below by 
October 31, 2005 will be accepted.

ADDRESSES: Because of staff and resource limitations, we can only 
accept comments by mail or electronic bill (e-mail). We are unable to 
accept comments by facsimile (FAX) transmission. Send e-mail comments 
to [email protected]. Mail written comments to the following address 
only: TRICARE Management Activity, TRICARE Operations/Dental Division, 
Skyline 5, Suite 810, 5111 Leesburg Pike, Falls Church, VA 22041-3206; 
Attention: Col. Gary C. Martin, Director. Please allow sufficient time 
for mailed

[[Page 51693]]

comments to be timely received in the event of delivery delays.

FOR FURTHER INFORMATION CONTACT: Col. Gary C. Martin, Office of the 
Assistant Secretary of Defense (Health Affairs)/TRICARE Management 
Activity, telephone (703) 681-0039.

SUPPLEMENTARY INFORMATION:

I. Background

    Revision of Participating Providers Reimbursement Rate. Currently, 
32 CFR 199.13 requires the TRICARE Dental Program contractor to 
reimburse participating providers at the equivalent of a percentile of 
prevailing charges sufficiently above the 50th percentile of prevailing 
charges made for similar services in the same locality (region) or 
state, or the provider's actual charge, whichever is lower, less any 
cost-share amount due for authorized services. This provision was 
included in the regulation to constitute a significant financial 
incentive for participation of providers in the contractor's network 
and to ensure a network of quality providers through use of a higher 
reimbursement rate. This provision, however, places an unnecessary 
restriction on contractors that already have established, high quality 
provider networks with reimbursement rates below the 50th percentile 
that are of sufficient size to meet the access requirements of the 
TRICARE Dental Program. The reimbursement rates that have been 
negotiated over the life of the dental contract represent the general 
market rates for dental insurance reimbursement, and the proposed rule 
change would bring DoD reimbursement rates into line with the broader 
insurance market. Elimination of the 50th percentile requirement will 
afford the Government and enrollees significant cost savings through 
lower provider reimbursement costs by the contractor. Additionally, 
contractors have other methods available to ensure the TDP members 
receive high quality dental services. These quality assurance methods 
include, but are not limited to, licensing and credentialing standards, 
patient satisfaction assessments, and provider trend analyses.

II. Regulatory Procedures

    The Department of Defense (DoD) has examined the economic 
implications of this proposed rule as required by Executive Order 
12866. Executive Order 12866 directs agencies to assess costs and 
benefits of available regulatory alternatives and, when regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity). Executive 
Order 12866 classifies a rule as significant if it meets any one of a 
number of specified conditions, including: having an annual effect on 
the economy of $100 million or more, adversely affecting a sector of 
the economy in a material way, adversely affecting competition, or 
adversely affecting jobs. A regulation is also considered a significant 
regulatory action if it raises novel legal or policy issues.
    DoD concludes that this proposed rule is a significant regulatory 
action under the Executive Order since it raises novel policy issues 
under Section 3(f)(4). DoD concludes, however, that this proposed rule 
does not meet the significance threshold of $100 million effect on the 
economy in any one year under Section 3(f)(1), with an estimated annual 
impact on the economy of $5 million (See attachment for details). The 
estimate annual impact was determined by comparing the current level of 
reimbursement for network dental providers in the TDP with the expected 
level of reimbursement under this Proposed Rule. The current rate of 
reimbursement was assessed by independent actuarial advisers. This rate 
is consistent with a market-driven level of payments that is necessary, 
on average, to maintain a large and stable network of dentists. The 
difference was multiplied by the projected level of utilization for 
network providers in 2006. In the aggregate, for all network TDP 
providers, the Proposed Rule is estimated to reduce network dental 
provider payments by $0-5 million in 2006. For the approximately 70,000 
network dental providers, this impact averages $0-$70 per year per 
network dentist, which is less than 0.1 percent of the net income for 
the dentists in the U.S. (according to the American Dental 
Association's 2002 Survey of Dental Practice). Although the average 
impact is minimal, the upper end of the range for a network dentist is 
estimated to be as much as $1,700 per year. This assumes a decline of 2 
percent in the reimbursement level for a network dentist whose practice 
consists of 15 percent TDP patients. The level of reimbursement 
required to have a stable network of providers is a percentile less 
than the current percentile of billed charges.
    The Congressional Review Act establishes certain procedures for 
major rules, defined as those with similar major impacts. The 
Regulatory Flexibility Act (RFA) requires that each Federal agency 
prepare, and make available for public comment, a regulatory 
flexibility analysis when the agency issues a regulation that would 
have significant impact on a substantial number of small entities. This 
is not a major rule under 5 U.S.C. 801. It is a significant regulatory 
action but not economically significant. In addition, we certify that 
this proposed rule will not significantly affect a substantial number 
of small entities for the reasons stated above. This rule has been 
designated and has been reviewed by the Office of Management and Budget 
as required under the provision of E.O. 12866.

Paperwork Reduction Act

    This proposed rule contains a new information collection 
requirement. DoD has submitted the following proposal to OMB under the 
provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35). 
Comments are invited on: (a) Whether the proposed collection of 
information is necessary for the proper performance of the functions of 
DoD, including whether the information will have practical utility; (b) 
the accuracy of the estimate of the burden of the proposed information 
collection; (c) ways to enhance the quality, utility, and clarity of 
the information to be collected; and (d) ways to minimize the burden of 
the information collection on respondents, including the use of 
automated collection techniques or other forms of information 
technology.
    Title: Claim Form.
    Type of Request: New requirement.
    Number of Respondents: 56,512.
    Responses Per Respondent: 62.
    Annual Responses: 3,503,744.
    Average Burden Per Response: 15 minutes.
    Annual Burden Hours: 875,936.
    Needs and Uses: The TRICARE Management Activity (TMA) under the 
authority of the Office of the Assistant Secretary of Defense (Health 
Affairs)/TMA Office of the Deputy Assistant Secretary of Defense has 
the responsibility for management of the TRICARE dental program as 
established in Title X, United States Code, section 1076a. The TDP 
claim form is required to gather information to make payment for 
legitimate dental claims, to assist in contractor surveillance and 
program integrity investigations and to audit financial transactions 
where the Department of Defense has a financial stake. The information 
from the claim form is also used to provide important cost share 
explanations to the beneficiary.
    Affected Public: Business or other for-profit.
    Frequency: 5 per month.

[[Page 51694]]

    Respondent's Obligation: Voluntary.
    Written comments and recommendations on the proposed information 
collection should be sent to the TRICARE Management Activity, Attn: Col 
Gary Martin, 5111 Leesburg Pike, Suite 810, Falls Church, VA 22041-3206 
(703-681-0039). Comments should be received within 60 days of 
publication of this notice.
    To request more information on this proposed information collection 
or to obtain a copy of the proposed and associated collection 
instruments, please write to TRICARE Management Activity, Attn: Col 
Gary Martin, 5111 Leesburg Pike, Suite 810, Falls Church, VA 22041-
3206, or telephone Col Martin at 703-681-0039.

List of Subjects in 32 CFR Part 199

    Claims, Dental health, Health care, Health insurance, Individuals 
with disabilities, Military personnel.

    For the reasons set out in the preamble, 32 CFR part 199 is 
proposed to be amended as follows:

PART 199--[AMENDED]

    1. The authority citation for Part 199 continues to read as 
follows:

    Authority: 5 U.S.C. 301; 10 U.S.C. Chapter 55.

    2. Section 199.13(g)(2)(ii) is proposed to be revised to read as 
follows:


Sec.  199.13  TRICARE Dental Program.

* * * * *
    (g) * * *
    (2) * * *
    (ii) Participating providers shall be reimbursed in accordance with 
the contractor's network agreements, less any cost-share amount due for 
authorized services.
* * * * *

    Dated: August 25, 2005.
Jeannette Owings-Ballard,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 05-17299 Filed 8-30-05; 8:45 am]
BILLING CODE 5001-06-M