A bill to amend title 10, United States Code, to authorize the use of health maintenance organizations in providing health care.

Provides that the Secretary of Defense, after consulting with the Secretary of Health, Education, and Welfare, may contract with health maintenance organizations as identified by the Secretary of Health, Education, and Welfare. States that the provisions of such a contract may deviate from the cost-sharing arrangements prescribed and the types of health care authorized under title 10 of the United States Code when the Secretary of Defense determines that such a deviation would serve the purpose of that title. Provides that such a contract, however, may not provide for annual payments per beneficiary, by the Government and a beneficiary, of any amount greater than the estimated average annual cost for comparable amounts of care of similar quality provided under the cost-sharing arrangements prescribed in that title. (Adds 10 U.S.C. 1809)