TRICARE has recognized the unique circumstances existing in Alaska which make the provision of medical care to TRICARE beneficiaries through the TRICARE program operated in the other 49 states unrealistic. Recognizing these unique conditions and circumstances, the Department of Defense has conducted a demonstration project in the state of Alaska since implementation of the TRICARE program under which certain exceptions have been made for administration of the program in Alaska. This rule incorporates the waiver of the requirement for financial underwriting by a TRICARE contractor as a permanent change to the administration of the TRICARE program in Alaska. This rule proposes no change to the TRICARE benefit or to those who are eligible for it. However, the rule does eliminate the financial underwriting of health care costs in the state of Alaska by a TRICARE contractor.