UnitedHealth sues DOD over Tricare fight

UnitedHealth Group filed a lawsuit against the U.S. Department of Defense Tuesday, seeking the restoration of a $20 billion contract to oversee health care for more than 3 million military members, retirees and families within the government's Tricare network. Minnetonka-based UnitedHealth won the contract to serve Tricare's south region in 2009, only to have the deal taken away in 2011, following a protest by Humana, the health insurance company that previously held the contract. UnitedHealth then filed its own protest, which failed last week when the Government Accountability Office refused to side with UnitedHealth in the dispute. UnitedHealth claims that after losing the contract, Humana reworked its bid using doctor and hospital reimbursement fees that are too low to attract physicians and facilities to participate in the Tricare program. "The stakes for military families are simply too high, and the deficiencies in the contracting process too significant, for the Department of Defense to proceed with implementing this contract as it stands," Lori McDougal, CEO of UnitedHealthcare's military health division, said in a statement.