Sponsors (3)
The bill shifts TRICARE payments to location-specific rates to lower beneficiary costs and reduce overpayments, but it also reduces some provider revenues and imposes administrative and short-term transition burdens that could threaten local access to care.
TRICARE beneficiaries (active-duty, retirees, dependents) may pay lower costs when reimbursements are set to the lowest applicable location-based rates, reducing their out-of-pocket and program spending.
Hospitals and the TRICARE program will see more accurate payments because geographically specific rates and location identifiers align reimbursements with where care is delivered, reducing overpayments and waste.
TRICARE providers (hospitals, ASCs, physician offices) will have clearer billing rules—separate categories for inpatient, on-/off-campus outpatient, ASC, and physician office—that can streamline claims processing and reduce billing disputes.
Hospitals and clinics—especially those serving large military or veteran populations—may receive reduced payments under location-based rates, threatening facility revenue and financial viability.
TRICARE beneficiaries in some areas could face reduced access to care if providers limit TRICARE participation or cut services in response to lower location-based rates.
Healthcare providers and billing staff will incur administrative and IT costs to update systems to capture unique, geographically specific NPI location codes and new billing rules.
Based on analysis of 2 sections of legislative text.
Requires TRICARE to use the lowest applicable reimbursement rate, adopt geographically specific, location-level rates, and require a location-specific NPI on claims.
Requires TRICARE to use the lowest applicable reimbursement rate when multiple rates apply and to adopt provider-location, geographically specific payment rates for a range of outpatient and inpatient settings. Claims filed under TRICARE must include a unique, geographically specific provider-location identifier (a location-level NPI code). The changes take effect January 1, 2026.
Introduced January 31, 2025 by Rich McCormick · Last progress January 31, 2025