The Children's Hospital Association — alongside several children’s hospitals — submitted a joint letter to the House and Senate Armed Services Committees urging support for Section 723 of the House-passed National Defense Authorization Act (NDAA).
This provision would establish a more appropriate payment adjustment within the TRICARE program for outpatient services provided to children of service members by children’s hospitals.
The request follows a 2023 rule from the Defense Health Agency that began reimbursing outpatient pediatric visits using the Medicare Outpatient Prospective Payment System (OPPS).
Because Medicare covers only a small fraction of pediatric patients, OPPS rates do not reflect the true cost of pediatric care. As a result, this change has led to a significant reduction in payments to children’s hospitals, threatening access to care for military-connected children.
