ADDITIONAL AUTHORIZED OPTION PERIODS FOR EXTENSION OF CURRENT CONTRACTS UNDER TRICARE.

SEC. 736. ADDITIONAL AUTHORIZED OPTION PERIODS FOR EXTENSION OF CURRENT CONTRACTS UNDER TRICARE.(a) Additional Number of Authorized Periods.—(1) In general.—The Secretary of Defense, after consulting with the other administering Secretaries, may extend any contract for the delivery of health care entered into under section 1097 of title 10, United States Code, that is in force on the date of the enactment of this Act by one year, and upon expiration of such extension by one additional year, if the Secretary determines that such extension—(A) is in the best interests of the Department of Defense and covered beneficiaries;(B) is cost effective; and(C) will—120 STAT. 2302(i) facilitate the effective administration of the TRICARE program; or(ii) ensure continuity in the delivery of health care under the TRICARE program.(2) Limitation on number of extensions.—The total number of one-year extensions of a contract that may be granted under paragraph (1) may not exceed two extensions.(3) Notice and wait.—The Secretary may not commence the exercise of the authority in paragraph (1) with respect to a contract covered by that paragraph until 30 days after the date on which the Secretary submits to the Committees on Armed Services of the Senate and House of Representatives a report setting forth the following:(A) The minimum level of performance, including beneficiary satisfaction and cost, by the incumbent contractor under the contract that will be required by the Secretary in order to be eligible for an extension authorized by such paragraph.(B) The justification for such extension based on each of the criteria in paragraph (1).(C) The justification for such extension based on a cost-benefit analysis.(4) Definitions.—In this subsection, the terms “administering Secretaries”, “covered beneficiary”, and “TRICARE program” have the meaning given such terms in section 1072 of title 10, United States Code.(b) Report on Contracting Mechanisms for Health Care Service Support Contracts.—Not later than 180 days after the date of the enactment of this Act, the Secretary shall submit to the Committees on Armed Services of the Senate and House of Representatives a report on contracting mechanisms under consideration for future contracts for health care service support under section 1097 of title 10, United States Code. The report shall include an assessment of the advantages and disadvantages for the Department of Defense (including the potential for stimulating competition and the effect on health care beneficiaries of the Department) of providing in such contracts for a single term of 5 years, with a single optional period of extension of an additional 5 years if performance under such contract is rated as “excellent”.