I'm sorry this is going to be really long. I stumbled across this thread today as a midwife looking for information about Tricare reimbursement. There are a lot of questions brought up about how payment works for midwives and I thought it might make things a little clearer if I explained it from the other side. I am not military so I'm not really up on the abbreviations, needs for referrals, and standard versus prime; but I do recall in general how the system works from my father being a career Naval officer.
First, I would like to say that dealing with insurance in general can be a nightmare. I do all of my own direct client billing and am perfectly capable of doing insurance billing myself, but it's worth it to me to pay someone else just to interface with insurance companies for me.
I am not a preferred/participating/in-network provider for any insurance company. This is because as an in-network provider I would have to sign a contract agreeing to be paid only what they choose to pay me. This is usually around half of my full fee (or "retail" fee as I've seen it referred to here). Providers and insurance companies both acknowledge that an in-network fee is considerably less than what services are actually worth, but in theory accepting the reduction is mutually beneficial since the provider makes up for this loss of income by receiving more patients through referrals from the insurance company. However, this arrangement assumes that there is enough demand for home births that my phone will be ringing off the wall with patients looking for an in-network provider for their insurance. This is not the case. Instead, I might get a call every couple of years from a Tricare patient looking for a midwife. In those cases, I would be working just as hard for that patient as I would for any other, but being paid only half. There is no incentive for me to do so.
I feel like my services are worth what they're worth, not what some insurance company feels like paying me. I will bill a patient's insurance, but if they do not pay my full fee then I do expect the patient to pay the balance. I don't see why it would be appropriate for me to lower that fee because the insurance company doesn't want to pay all of it. The total is the same fee that you would pay if you had no insurance reimbursement at all; at least if Tricare does pay your midwife that's ~$1400 less than others would have to pay out-of-pocket.
I think there are two issues here when wondering why a midwife won't take Tricare. The first is simply the hassle. Most insurance companies are a hassle to deal with; I will spend hours over the course of a patient's care simply taking care of insurance matters plus I pay out of pocket to have someone interface with the companies for me. Tricare will be a double hassle, considering that I might have to fight to get any payment on top of all the usual work of insurance filing.
Second is the reimbursement rate. With Tricare apparently any reimbursement hinges on what they consider to be a customary in-network rate. Remember that in-network rates are admittedly about half of a regular rate. So even if they pay 80%, they're only paying 80% of half of my fee.
What I have gathered is that Tricare occasionally pays CPMs, but only as an oversight. Even with a prior authorization number, I would expect Tricare to drag their feet on paying once they realize their mistake.
I will accept Tricare payments, but I will never be a contracted Tricare provider. The patient will need to pay the full fee up front and I will refund them any amount I am able to sqeeze out of Tricare. I know that this arrangement will be cost restrictive to many military families but I've got my own family that needs to be taken care of and I simply cannot afford financially, physically, or mentally to be working so hard for so little money.
I hope this helps to answer any questions about why home birth midwives don't "take" Tricare.