Rapid growth problems face the $53 billion Defense Health Program, which covers 9.7 million active and retired service members, their families, and eligible surviving family members of deceased active and retired service personnel.
The 3,050 employees at the headquarters of the Military Health System are preparing to move this summer into a three-building complex in Falls Church that will contain the offices of the assistant defense secretary for health affairs, the Tricare Management Activity, the Army and Air Force surgeons general, and the Navy Bureau of Medicine.
The Pentagon health program’s budget issues are well known, the overall costs having more than doubled in the past 10 years and expected to continue to shoot up unless tough changes are made. The health-care headquarters staff has already been cut by 440 employees from 2011, and aligning its reimbursement rates for outpatient services with Medicare rates will save $900 million annually.
Less publicized is the more than 10-year history of efforts to revamp the military health-care bureacracy. The 2012 annual report by the Government Accountability Office on duplication, released last month, cited its 2005 study that called the Pentagon health-care system an area where “combining, realigning, or otherwise changing selected support functions” could achieve improved delivery of services — and save money.
One alternative the 2005 study suggested was to create “a unified medical command similar to [the Defense Department’s] unified transportation command.” Another was to set up two commands, one for operational medicine for the active services with the ability to be battlefield-deployed. The other, to handle “beneficiary care” for service personnel, families and retirees through military hospitals and contracted health providers.
“Inability to obtain a consensus among the services” — i.e., Army, Navy and Air Force leadership could not agree — was cited for why no basic change occurred. Instead, a smaller, seven-step program to end obvious overlaps was approved in late 2006. But the new GAO report notes only “varying levels of progress in implementing four of the seven incremental steps.”
Last June, because of program growth, top Pentagon officials established an internal task force to review the Military Health System governance. The interagency group proposed the creation of a Defense Health Agency that would subsume Tricare Management Activity and deal with pharmacy programs, medical education training, research and development, and other common activities. Its director would be a three-star general or flag officer and operate under the assistant secretary of defense for health affairs. The military services would retain their surgeons general and their separate treatment facilities as well as their own medical personnel, readiness programs and health-care delivery. It is estimated that this proposal would lead to a reduction of 330 full-time employees and a savings of roughly $46.5 million a year.
The task force report cited the main flaw: Authority, direction and control of health services would remain divided and “add complexity to the coordination of deployments between [military] services and DHA.”
The reason the report gave for not creating a unified medical command or putting it under one service was that it “would require a massive reorganization that could . . . create unintended and unexpected cosequences” while combat is ongoing. It was noted that “the largest cost elements in healthcare are in the direct and civilian healthcare systems.”
Even this decision isn’t final. Under current legislation, the GAO must approve the proposal and so must Congress. Any implementation of this approach, if approved, probably would be delayed until mid-2013 or later.
Meanwhile, Congress is still threatening the Pentagon’s plan to cut its health-care spending by $12.9 billion over the next 10 years. Noting that most savings will come from retirees’ increased Tricare fees, Rep. Norm Dicks (D-Wash.) asked, “Are these estimated savings realistic?” at a March 8 hearing of the House Appropriations defense subcommittee. Opposition to the increases is being heard, but the proposed level is far below what other federal employees pay.
Defense Comptroller Robert Hale’s report on proposed decreases in the 2013 health budget from the fiscal 2012 appropriation includes $603.6 million taken to eliminate “one-time congressional adds” — funds for the Congresssionally Directed Medical Research Program, added each year by Congress for specified research.
At the March 8 hearing, Rep. Ander Crenshaw (R-Fla.) referred to his daughter’s 12-year struggle with an inflammatory stomach disease, which he said affects one out of every 200 people. He said some of the money appropriated in the congressionally directed program had been used for research into that disease.
Assistant Defense Secretary Jonathan Woodson, without referring to year-after-year department efforts to cancel the congressional add-on, said the program added “value to military medicine.” He said he would check on what was being done about this stomach disease.
Rep. Maurice D. Hinchey (D-N.Y.) asked about a therapy to treat autism, which he said affects 20,000 military children, and why this particular therapy was not available under Tricare and only partially available to active-duty personnel. What was being done so “all military children get the doctor-prescribed amount of therapy for autism?” he asked.
Woodson said it was “not considered a medical treatment but an educational intervention for management of autism.” He said about $36,000 a year is available for individual active-duty personnel with dependents with autism. For retirees, he said, aid was limited by statute.
Rep. James P. Moran (D-Va.) asked what was being done about smoking in the services, where it is “twice as prevalent” as outside the military.” He added that it would lead to more veterans with “tobacco-related illness, which is going to have to be paid for by Tricare.” Woodson said he was moving “from what we call health care to health” and that “one of the targeted areas for this year is smoking cessation.”
Neither Republicans nor Democrats seem to object to this form of government-directed and -controlled health care for the military. They appear to want it expanded. What’s the difference for those legislators who see President Obama’s affordable health-care act as too much government control?
For previous Fine Print columns, go to washingtonpost.com/fedpage.