IMPLEMENTATION OF REDESIGN OF PHARMACY SYSTEM.

SEC. 723. IMPLEMENTATION OF REDESIGN OF PHARMACY SYSTEM. (a) In General.— Not later than October 1, 1999, the Secretary of Defense shall implement, with respect to eligible individuals described in subsection (e) who reside in an area selected under subsection (f), the redesign of the pharmacy system under TRICARE (including the mail-order and retail pharmacy benefit under TRICARE) to incorporate “best business practices” of the private sector in providing pharmaceuticals, as developed under the plan described in section 703. (b) Collection of Premiums and Other Charges.— The Secretary of Defense may collect from eligible individuals described in subsection (e) who participate in the redesigned pharmacy system any premiums, deductibles, copayments, or other charges that the Secretary would otherwise collect from individuals similar to such individuals. (c) Evaluation.— The Secretary shall provide for an evaluation of the implementation of the redesign of the pharmacy system under TRICARE under this section by an appropriate person or entity that is independent of the Department of Defense. The evaluation shall include the following: (1) An analysis of the costs of the implementation of the redesign of the pharmacy system under TRICARE and to the eligible individuals who participate in the system. (2) An assessment of the extent to which the implementation of such system satisfies the requirements of the eligible individuals for the health care services available under TRICARE. (3) An assessment of the effect, if any, of the implementation of the system on military medical readiness. (4) A description of the rate of the participation in the system of the individuals who were eligible to participate. (5) An evaluation of any other matters that the Secretary considers appropriate. (d) Reports.— The Secretary shall submit two reports on the results of the evaluation under subsection (c), together with the evaluation, to the Committee on Armed Services of the Senate and the Committee on National Security of the House of Representatives. The first report shall be submitted not later than December 31, 2000, and the second report shall be submitted not later than December 31, 2002. 112 STAT. 2069 (e) Eligible Individuals.— (1) An individual is eligible to participate under this section if the individual is a member or former member of the uniformed services described in section 1074(b) of title 10, United States Code, a dependent of the member described in section 1076(a)(2)(B) or 1076(b) of that title, or a dependent of a member of the uniformed services who died while on active duty for a period of more than 30 days, who— (A) is 65 years of age or older; (B) is entitled to hospital insurance benefits under part A of title XVIII of the Social Security Act (42 U.S.C. 1395cet seq.); (C) except as provided in paragraph (2), is enrolled in the supplemental medical insurance program under part B of such title XVIII (42 U.S.C. 1395j et seq.); and (D) resides in an area selected by the Secretary under subsection (f). (2) Paragraph (1)(C) shall not apply in the case of an individual who at the time of attaining the age of 65 lived within 100 miles of the catchment area of a military medical treatment facility. (f) Areas of Implementation.— (1) The Secretary shall carryout the implementation of the redesign of the pharmacy system under TRICARE in two separate areas selected by the Secretary. (2) The areas selected by the Secretary under paragraph (1)shall be as follows: (A) One area shall be an area outside the catchment area of a military medical treatment facility in which— (i) no eligible organization has a contract in effect under section 1876 of the Social Security Act (42 U.S.C. 1395mm) and no Medicare+Choice organization has a contract in effect under part C of title XVIII of that Act (42 U.S.C. 1395w–21); or (ii) the aggregate number of enrollees with an eligible organization with a contract in effect under section 1876 of that Act or with a Medicare+Choice organization with a contract in effect under part C of title XVIII of that Act is less than 2.5 percent of the total number of individuals in the area who are entitled to hospital insurance benefits under part A of title XVIII of that Act. (B) The other area shall be an area outside the catchment area of a military medical treatment facility in which— (i) at least one eligible organization has a contract in effect under section 1876 of that Act or one Medicare+Choice organization has a contract in effect under part C of title XVIII of that Act; and (ii) the aggregate number of enrollees with an eligible organization with a contract in effect under section 1876of that Act or with a Medicare+Choice organization with a contract in effect under part C of title XVIII of that Act exceeds 10 percent of the total number of individuals in the area who are entitled to hospital insurance benefits under part A of title XVIII of that Act.