[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]



                         [H.A.S.C. No. 110-16]
 
                                HEARING

                                   ON

                   NATIONAL DEFENSE AUTHORIZATION ACT

                          FOR FISCAL YEAR 2008

                                  AND

              OVERSIGHT OF PREVIOUSLY AUTHORIZED PROGRAMS

                               BEFORE THE

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                MILITARY PERSONNEL SUBCOMMITTEE HEARING

                                   ON

  MILITARY HEALTH-CARE BUDGET AND THE CHALLENGES FACING THE MILITARY 
                           HEALTH-CARE SYSTEM

                               __________

                              HEARING HELD

                           FEBRUARY 13, 2007


[GRAPHIC] [TIFF OMITTED] TONGRESS.#13


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                    MILITARY PERSONNEL SUBCOMMITTEE

                     VIC SNYDER, Arkansas, Chairman
MARTY MEEHAN, Massachusetts          JOHN M. McHUGH, New York
LORETTA SANCHEZ, California          JOHN KLINE, Minnesota
SUSAN A. DAVIS, California           THELMA DRAKE, Virginia
NANCY BOYDA, Kansas                  WALTER B. JONES, North Carolina
PATRICK J. MURPHY, Pennsylvania      JOE WILSON, South Carolina
CAROL SHEA-PORTER, New Hampshire
                 Debra Wada, Professional Staff Member
               Jeanette James, Professional Staff Member
                   Margee Meckstroth, Staff Assistant
                      Joe Hicken, Staff Assistant

                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2007

                                                                   Page

Hearing:

Tuesday, February 13, 2007, Fiscal Year 2008 National Defense 
  Authorization Act--Military Health-Care Budget and the 
  Challenges Facing the Military Health-Care System..............     1

Appendix:

Tuesday, February 13, 2007.......................................    33
                              ----------                              

                       TUESDAY, FEBRUARY 13, 2007
 FISCAL YEAR 2008 NATIONAL DEFENSE AUTHORIZATION ACT--MILITARY HEALTH-
 CARE BUDGET AND THE CHALLENGES FACING THE MILITARY HEALTH-CARE SYSTEM
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

McHugh, Hon. John M., a Representative from New York, Ranking 
  Member, Military Personnel Subcommittee........................     1
Snyder, Hon. Vic, a Representative from Arkansas, Chairman, 
  Military Personnel Subcommittee................................     1

                               WITNESSES

Winkenwerder, Hon. William, Jr., MD, MBA, Assistant Secretary of 
  Defense for Health Affairs, Department of Defense..............     2

                                APPENDIX

Prepared Statements:

    McHugh, Hon. John M..........................................    39
    Snyder, Hon. Vic.............................................    37
    Winkenwerder, Dr. William, Jr................................    42

Documents Submitted for the Record:
    [There were no Documents submitted.]

Questions and Answers Submitted for the Record:

    Mrs. Drake...................................................    67
    Mr. McHugh...................................................    66
    Dr. Snyder...................................................    59
 FISCAL YEAR 2008 NATIONAL DEFENSE AUTHORIZATION ACT--MILITARY HEALTH-
 CARE BUDGET AND THE CHALLENGES FACING THE MILITARY HEALTH-CARE SYSTEM

                              ----------                              

                  House of Representatives,
                       Committee on Armed Services,
                           Military Personnel Subcommittee,
                        Washington, DC, Tuesday, February 13, 2007.
    The subcommittee met, pursuant to call, at 2:04 p.m., in 
room 2212, Rayburn House Office Building, Hon. Vic Snyder 
(chairman of the subcommittee) presiding.

  OPENING STATEMENT OF HON. VIC SNYDER, A REPRESENTATIVE FROM 
      ARKANSAS, CHAIRMAN, MILITARY PERSONNEL SUBCOMMITTEE

    Dr. Snyder. The committee will come to order.
    We are pleased today to have as our guest Dr. Winkenwerder, 
who is--we are all familiar with him and he is familiar with us 
after almost six years of time in this position.
    We certainly appreciate your service, Dr. Winkenwerder.
    I just want to be real brief and not read a formal opening 
statement before I yield to Mr. McHugh, but the issues that we 
continue to address as a committee and as a Congress and as the 
American people is how do we maintain the quality of care for 
our men and women in uniform and their families and retirees 
and how we pay for it.
    And we are looking for your guidance and advice and 
thoughts on that, Dr. Winkenwerder, and I look forward to your 
testimony and the questions and answers we have.
    As I mentioned before, we have three members of this 
committee that have never served on the Armed Services 
Committee before and are new to this Congress, and we have some 
veterans, but we all benefit from as complete an explanation as 
you want to give as to any of the issues coming forth.
    And, with that, I will yield to Mr. McHugh.
    [The prepared statement Dr. Snyder can be found in the 
Appendix on page 37.]

  STATEMENT OF HON. JOHN M. MCHUGH, A REPRESENTATIVE FROM NEW 
     YORK, RANKING MEMBER, MILITARY PERSONNEL SUBCOMMITTEE

    Mr. McHugh. Thank you, Mr. Chairman.
    Doctor, welcome. I echo the chairman's comments and deeply 
appreciate, as well, your leadership over the years. It is 
always a pleasure to have you with us. And, as Chairman Snyder 
said, we look forward to your comments.
    I, too, will ask for unanimous consent to have my statement 
placed in the record.
    Dr. Snyder. Without objection.
    Mr. McHugh. But I have just a couple of comments.
    Obviously, as the chairman and I have discussed, there is, 
as there was last year, some considerable imputed savings and 
components of this budget proposal placed in predicated upon 
congressional action, about $2.1 billion, which also has to do 
with expected so-called savings and other kinds of fiscal 
advances by the upcoming Task Force on Military Health Care 
that is looking at these kinds of issues.
    That was a proposal that was not well-received last year--
is that a fair way to say that? I think it is--in the Congress, 
and that is a lot of money. And we would like to hear from you, 
of course, as to how you came to that point again. I am kind of 
troubled by it.
    Also, with about $157 million, I believe the figure is, in 
requested increases to fund a continuation of the military to 
civilian transformation, about 2,700 positions--we have gone 
through a big chunk of that, over 5,500. We have to begin to 
become somewhat concerned that we are not reaching too far on 
that. So I look forward to your comments on that, as well.
    But, beyond that, as the chairman said, we look forward to 
your comments.
    And with that, Mr. Chairman, I yield back to you.
    [The prepared statement of Mr. McHugh can be found in the 
Appendix on page 39.]
    Dr. Snyder. Thank you, Mr. McHugh.
    One little bookkeeping--no, ``bookkeeping'' is not the 
word--etiquette thing. We had a question last time about how 
members are recognized for questions. And traditionally on this 
committee, you know, comes down the gavel, we go back and forth 
by party. But then from there on, it is whoever shows up in the 
order in which they come in, regardless of party affiliation--
has been the way this committee has conducted its business.
    And that is the way we will do it, if that is all right 
with Mr. McHugh.
    Mr. McHugh. Absolutely. It is tradition.
    Dr. Snyder. Dr. Winkenwerder, take as much time as you 
need.

STATEMENT OF HON. WILLIAM WINKENWERDER, JR., MD, MBA, ASSISTANT 
 SECRETARY OF DEFENSE FOR HEALTH AFFAIRS, DEPARTMENT OF DEFENSE

    Dr. Winkenwerder. Thank you. And I can hear that my 
microphone is on, so, Mr. Chairman, thank you, and thank you to 
all the members of this committee for the opportunity to 
discuss the nation's military health system now and in the 
future.
    And thank you for your tremendous support and steady 
support over the years that I have been in the fortunate 
position to be able to lead this system and to serve all the 
great Americans that we serve.
    Today, we serve and protect more than 2.2 million service 
members in the active, reserve and national guard components, 
including more than 250,000 who are deployed overseas.
    America's military health system is unquestionably the 
finest in the world. Our medical professionals have performed 
superbly on the battlefield. I want to just recount a few facts 
for you in that regard.
    We have the lowest death-to-wounded ratio and the lowest 
disease-and-non-battle-injury rate witnessed in the history of 
warfare. Once we put that dedicated, trained, professional on 
the scene, a remarkable 97 percent to 98 percent survive.
    Also, remarkably, among the approximate, at this point in 
time, 23,000, give or take, service members in Iraq to date who 
have been wounded, over 70 percent have returned to duty within 
72 hours--that is, within three days.
    My priority remains to provide life-enhancing, life-
sustaining care to America's service men and women, both 
deployed and here at home, and to simultaneously sustain the 
high-quality health-care system that we offer to more than nine 
million Americans.
    Today, what I would like to do is briefly touch on three 
items of concern to me and our leadership: first, our fiscal 
year 2008 budget and critical near-term financial issues; 
second, the long-term plans to strengthen our health system; 
and third, our efforts to provide an even more integrated joint 
health-care delivery system.
    With our fiscal 2008 health-care budget estimate of about 
$40 billion, we have submitted legislation, as you know, to 
assist in bringing our rapidly growing costs under better 
control. It is best to view this proposal as a placeholder. It 
reflects the magnitude of the department's growing health-care 
problem.
    We believe that the members of the recently established 
Task Force on the Future of Military Health Care should have a 
completely free hand in making their recommendations that 
address the sustainability of military health care and the 
TRICARE benefit. The thinking of these military and civilian 
experts brings, in our view, a welcome and fresh perspective to 
the potential solutions for our cost-growth issues.
    As they have begun their work, the task force members now 
realize that the majority of Department of Defense (DOD) health 
spending is for retirees and their family members, who make up 
more than half of our eligible beneficiary population. By 2011, 
retiree health spending will dominate DOD health spending, with 
65 percent of all dollars going for retirees.
    We need help in addressing this problem and help in 
educating our beneficiaries and advocacy groups with a fresh 
and welcome look.
    You, America's representatives, have heard these numbers 
before, but let me restate them. Left unchanged, our program 
will cost taxpayers $64 billion by 2015. Health-care costs will 
continue to consume a growing slice of the department's budget, 
reaching 12 percent of the DOD budget, versus 6 percent in 
2001.
    Without relief, spending for health care will, in my 
judgment, divert critical funds needed for war-fighters, their 
readiness and for critical equipment.
    I hope you are as eager as I am to see how the experts of 
the task force, with their original and their earnest views on 
the issue, how they assess our situation and what they will 
recommend. Again, we are very open to whatever it is that they 
recommend and trust the good judgment that they are bringing to 
the task.
    In the meantime, we are doing everything we can to control 
our cost growth. We are also executing our new TRICARE regional 
contracts more efficiently, saving dollars, and we are 
demanding greater efficiency within our own military medical 
facilities.
    However, there is one area, pharmacy, that is particularly 
noteworthy. Nearly 6.7 million beneficiaries use our pharmacy 
benefit, and in fiscal 2006, our total pharmacy cost was more 
than $6 billion for that year alone. If we did nothing to 
control our pharmacy cost growth, we project pharmacy costs 
alone would reach $15 billion by 2015.
    We are taking every action for which we have authority: 
promoting our mandatory generic substitution policy, joint 
contracting with the Veterans Administration, launching a mail-
order promotion campaign, and making voluntary agreements with 
pharmaceutical manufacturers to lower the cost.
    These efforts are working, but recent legislation passed by 
Congress and other regulations limit our ability to control 
costs in the fastest area of pharmacy, and that is the retail 
sector. In retail, products cost us 50 percent more than the 
same drugs dispensed through our military treatment facility or 
through mail-order. That is 50 percent more.
    You can help us, we believe, by allowing the department to 
make appropriate changes in the structure of our pharmacy 
benefit. These changes will clearly accelerate use of our new 
mail-order and, we are calling it, our home-delivery pharmacy 
program, enhance the use of generics, and it will also give us 
greater leverage when negotiating with the pharmaceutical 
manufacturers.
    Another area on which I want to update you is our effort to 
better integrate our health-care delivery system. Our line 
leaders, the Joint Chiefs of Staff and our customers world-wide 
expect that we will operate in a more joint manner throughout 
the world.
    We are doing that in combat theaters today, and we are 
doing it in the seamless transfer of our wounded or ill service 
members from the jointly staffed medical center in Landstuhl, 
Germany. You have heard about these efforts.
    We are now preparing to bring the advantages of joint 
operations to our medical facilities in the United States.
    Based on the decisions made by the previous Congress to 
accept the Base Realignment and Closure Commission 
recommendations, the BRAC recommendations, we are moving 
forward with the consolidation of medical facilities here in 
the national capital area and in San Antonio. We are also 
consolidating operations in medical research and development 
and in education and training.
    The medical infrastructure we are creating will better 
serve our beneficiaries through improved access to care, by 
locating primary care services closer to our patient 
population, through enhanced graduate medical education, 
through joint military medical enlistee training, and through 
the creation of, in our judgment, the world's best military 
medical facility, the new Walter Reed National Military Medical 
Center on the Bethesda campus.
    I remain deeply honored to work with the military medical 
officers, civilians and enlisted personnel and our support 
contractors, who provide exceptionally high-quality medical 
care to our service members while our nation is at war.
    We are giving our best effort to care for both the physical 
and the mental wounds that war produces. And we are succeeding 
in saving lives while helping many of our wounded warriors to 
be able to continue their careers in the military and 
continuing on active duty.
    I look forward to building upon many successes, to creating 
an even better, more efficient health-care system for the 
future.
    I know that you, Mr. Chairman, and other members of this 
committee have a similar vision. Working together with us and 
carefully considering the recommendations of the task force, I 
believe we can make military medicine stronger than ever for 
our deserving beneficiaries.
    And let me say this: Decisions we must make may not always 
be easy or politically expedient. But they will be the right 
decisions if they create the solid fiscal foundation for the 
future that will allow our great and talented professionals to 
continue providing world-class care for today's and tomorrow's 
protectors of America.
    Thank you again, Mr. Chairman and members of this 
committee, for your support for the men and women in uniform 
and for our military health system. We look forward to working 
with you in the coming year, and I look forward to answering 
your questions today. Thank you.
    [The prepared statement of Dr. Winkenwerder can be found in 
the Appendix on page 42.]
    Dr. Snyder. Thank you, Dr. Winkenwerder, for your 
statement.
    Debra is going to put the five-minute clock on me, and then 
we will go to Mr. McHugh for as much time as he will take, and 
then we will go around. And almost for sure, we will come back 
around.
    We don't have any more votes today, Dr. Winkenwerder, so we 
may have you until the thaw, until the spring thaw. [Laughter.]
    Dr. Winkenwerder, you have been outspoken in your views 
about how we need to pay for this. And you have run into both 
the realities of how we pay for the system but also perhaps the 
political realities of grappling with those issues. And you 
talked about it again today, both in your written and your oral 
statement.
    Last year when we had this discussion, you gave us a fair 
amount of written materials in terms of numbers and charts and 
graphs, and you haven't done that this year. And are you 
planning to provide us with that kind of numbers analysis so we 
know where you are at?
    I mean, part of what you gave us, you know, last year and 
what your charts showed last year were that, for military care 
and direct care, the number was very reasonable, in terms of 
being not quite a flat line but almost a flat line.
    Are you planning to provide us additional information on 
the status of your budget so that we might analyze that?
    Dr. Winkenwerder. Yes, we would be glad to provide any 
information that would be helpful to you.
    Let me just say, in terms of what we are terming the 
``placeholder legislative proposal,'' to us it is not so 
important as to what the specifics of the solution or solutions 
are as it is the decision, and decisions, to move forward to 
make some necessary changes.
    And we did not believe that it would be appropriate to come 
forward with a detailed, either, continuation of last year's 
proposal or a modification of that, because we felt that that 
would be, in fact, directing the task force to one solution or 
another.
    And so, candidly, we just didn't want to try to say, ``Here 
is the solution,'' or there it is----
    [The information referred to can be found in the Appendix 
beginning on page 59.]
    Dr. Snyder. No, I understand.
    Dr. Winkenwerder [continuing]. And so we have been rather 
generic.
    Dr. Snyder. I understand. What I am----
    Dr. Winkenwerder. And that has been our approach.
    Dr. Snyder [continuing]. More concerned about is that if 
you can provide us with your analysis this year about where we 
are at.
    Dr. Winkenwerder. Yes.
    Dr. Snyder. And I understand what you are saying.
    Dr. Winkenwerder. Okay.
    Dr. Snyder. And you did that last year, but you haven't 
this year, and I think it is important to have that.
    Dr. Winkenwerder. We will do that.
    Dr. Snyder. The second question I want to ask you--and you 
have probably heard that I did this with Secretary Gates the 
other day. But in the President's budget, there was a reference 
made to the future military health-care task force.
    And this is the line from the President's budget proposal: 
``In fiscal year 2008, this budget includes $1.862 million in 
proposed assumed savings, which assumes enactment of a $719 
million legislative proposal and additional regulatory 
modification requiring further study and a recommendation be 
made by the Department of Defense Task Force on the Future of 
Military Health Care, established by Public Law 109-452, on 
benefit reform.''
    Mr. McHugh continues to ask the most insightful questions 
at the full committee and brought this up the other day, and I 
had the staff chase down this one and asked Secretary Gates 
about it, because there are two aspects of it.
    Number one, the budget is saying flat-out a recommendation 
be made on a task force whose final report doesn't come out 
until December of this year. And some of us think that that is 
not very appropriate, to base a number or savings on a task 
force's opinions, its recommendations, that are not even 
expected to be out--now, they are going to do some preliminary 
stuff, but their final report doesn't come out until December.
    Second, this statement has poisoned the water a bit for 
this task force. And there are folks in this community, you 
know, who care a great deal about military retirees and 
veterans and folks in the military that look on that language 
as a sign you have stacked the task force. And I am telling 
them, ``Give it a chance.''
    And I have talked with some of the leadership of the task 
force who are very concerned, and I said, ``Look, you just go 
on out there and do your business. It is not the expectation of 
Congress that somehow your goal is to provide a recommendation 
for this year. You do the work as you see it.''
    So would you respond to those concerns, please, about this 
language in the President's budget?
    Dr. Winkenwerder. Yes.
    First of all, we have not, nor do we think it would make 
good sense, to ``stack'' the task force. That just is not in 
anybody's interest. It is a bipartisan group, for starters, and 
there was a special effort to ensure that. There was an effort 
to ensure that there was a variety of views.
    I think we know, as you do, that the solution, or 
solutions, are ones that are going to have to result from 
agreement across the aisle. There is not going to be, you know, 
a Republican solution or a Democrat solution. It really is 
going to require coming together.
    And so, that is the first point. And it is going to require 
even beyond the political spectrum to all the various different 
constituencies. That is the nature of our program. There are a 
lot of stakeholders in our program. We realize that. And so, 
the views and perspectives of all of those stakeholders need to 
be represented.
    It was not our goal to poison the water in any way. I hope 
that is not the case. I believe it will not be the case, 
because we have been clear that, from the department's 
standpoint, we are only supporting the task force in terms of 
providing whatever data, whatever information, reports, 
studies, analysis, that they request. And that is it.
    We are not, you know, behind the scenes trying to do 
anything other than that. I mean, the people that are on the 
group speak for themselves. They are strong-minded, strong-
willed, very bright individuals, as you know. And I have full 
confidence they are going to say whatever they think.
    Now, at this point, I think our task is to look at what 
they produce.
    And to your question about the interim versus final, it is 
our understanding that they do intend to issue some sort of 
interim report in May. That would not be the final report.
    But we also understand that they have prioritized the 
issues and that financial and funding and sustainability issues 
are at the top of their priority list. I understand they are 
probably going to take on some other things during this first 
three or four or six months.
    But it is our hope, certainly, that they would be able to 
come forward with some ideas that we could talk about. And 
candidly, I think many of us know what the potential solution 
set is. The question is, can we gather around to make some 
decisions in a way that we can all stand behind?
    Dr. Snyder. I agree with your comment about the strong 
wills. They were pretty strong-willed in their expression about 
that language.
    Dr. Winkenwerder. Yes.
    Dr. Snyder. Mr. McHugh, for as much time as he needs.
    Mr. McHugh. Put me on the clock, if I may, Mr. Chairman, 
too. If it is good enough for you, it is good enough for me, by 
golly.
    I would say, Dr. Winkenwerder, with respect to the 
chairman's comments about you maybe being here to the spring 
thaw, you had better hope that doesn't apply to my district, 
because we have had 12 feet of snow in the last week. 
[Laughter.]
    So I would take it a little bit easier on you than that.
    I would like to pursue this a little bit further. I don't 
know if it has poisoned the well with respect to the task 
force, but, as I am sure you know, it has not made a number of 
them happy.
    You have changed your testimony in the last few hours, at 
least as far as we know, and used an important word: 
``placeholder.'' It wasn't there originally. And that is an 
important change.
    But despite that word change, the fact of the matter is the 
budget request assumes savings of $1.9 billion.
    I appreciated your comments about--and there is over $240 
million of other undefined initiatives, and if you want to 
share some information about what those might be, that would be 
helpful as well.
    But your comments suggest that you are not just going to 
accept everything the task force says, I assume, number one.
    And number two, what if they come back with no savings? I 
kind of doubt that is going to happen, but it is within their 
parameters. What do we do about the $1.9 billion? Do you have a 
backup plan to fully fund it, or do you have a cut list? That 
is a lot of money.
    Dr. Winkenwerder. It is. And, yes, we do have some 
approaches that we would and could take.
    Mr. McHugh. Could you share those with us?
    Dr. Winkenwerder. Well, as you would guess, they are fairly 
dramatic in terms of their impact and what they would require. 
It is not our preference to move in those directions.
    Our preference is to get the whole train moving forward--
and the train with lots of cars being the Department of 
Defense, Congress, beneficiary advocacy groups, the task 
force--with the task force giving us, we hope, wise, informed, 
even-handed, prudent advice.
    And I just have confidence that we will be able to stand 
behind and support their recommendations. And I will be very 
surprised if their recommendations are not recommendations that 
we can support.
    I am confident, as well, that their recommendations are 
going to carry a lot of weight with all the audiences, because 
of the nature of the people that have been brought together. 
And they are not all of one mind. I am sure about that. There 
are a lot of different views there.
    But I think whatever they come up with is something we are 
going to have to look at very, very carefully.
    Mr. McHugh. Well, I agree. This is our one oversight 
hearing. And at the risk of sounding inhospitable, I think it 
is important for the committee members to hear and for the 
record to show if we don't come to that figure, what happens?
    Dr. Winkenwerder. The department, as it has in times past, 
will have to work within its own constituency to figure out how 
to solve these problems and issues----
    Mr. McHugh. Will you agree it wouldn't be pretty?
    Dr. Winkenwerder. I am sorry?
    Mr. McHugh. It would not be pretty. We are going to have 
to----
    Dr. Winkenwerder. It could be tough.
    Mr. McHugh. I mean, the mathematics are pretty simple. I 
was not a math major, but you are either going to have to find 
a huge amount of cuts or some kind of rabbit out of a hat. 
True?
    Dr. Winkenwerder. It is going to be tough. It would be 
tough, there is no question. It would be very difficult.
    But I will say this, and I think it is important for the 
committee to hear this: We looped back after last year's 
experience with our civilian leaders, with our military 
leaders--the vice chiefs, the chiefs, the vice chairmen, the 
chairmen--everybody. And I think what you are seeing is a 
statement of how convicted especially our military leaders are 
about this issue. And it is a statement about the degree to 
which they view the significance of the problem.
    And that is not something I could have done, you know, on 
my own, or that Dr. Chu and I could have done. I mean, this had 
to be a department view, because people realize that it is a 
serious proposal that has been put forward.
    Mr. McHugh. Absolutely. And let me just say, with the few 
seconds I have left, I do not mean to suggest for a moment that 
you, as an individual or your department in both the Pentagon 
and the individual services, are trying to do anything but what 
is absolutely right for these troops.
    But I just think it is critical for all the members to 
understand you have the nearly $2 billion worth of--in fact, 
over $2 billion when you add in the other $248 million--of 
undefined savings. That is a huge number to come up to.
    And if we don't come up to it through the task force or 
through something else that you or we or someone does, you are 
going to have to take $2 billion-plus out of the military 
health-care program. That is the reality. And that is a tough 
budget to bring to this Hill.
    Dr. Winkenwerder. You are right.
    Mr. McHugh. Okay. Thank you, sir.
    Thank you, Mr. Chairman.
    Dr. Snyder. Ms. Shea-Porter.
    Ms. Shea-Porter. Thank you.
    I have a couple of questions. I am new, and I am trying to 
determine the cost of soldiers in the field versus soldiers 
that are not being deployed, and wondered if you could first 
tell me that.
    Dr. Winkenwerder. If your question is about the cost of our 
ongoing operations in Iraq and Afghanistan----
    Ms. Shea-Porter. Yes.
    Dr. Winkenwerder [continuing]. As a result of the global 
war, it is around $1 billion. It is a bit over $1 billion this 
year.
    And let's see if I have the numbers here.
    In 2007, it is $1.73 billion. That is this year. Last year 
was actually a bit more than that in the supplemental, $1.153 
billion.
    And that covers a number of things: health care for 
mobilized guard and reserve who have to come forward to perform 
duties; pre- and post-deployment health care; additional things 
we do for people before and after deployment; something we 
called medical backfill, in other words, when we deploy service 
medical professionals and we have to fill for them back here in 
the United States, typically through call-up of guard and 
reserve or by purchasing care in our network; other medical 
support; and then aeromedical evacuation.
    Those are the main components, but that is roughly what the 
bill is in the aggregate.
    Ms. Shea-Porter. Okay. And these are obviously huge 
numbers, but I wondered if you could tell me what the cost 
would be per soldier, the average soldier. I recognize that, 
you know, there are different levels of health care required, 
and some injuries and some not, but just in general.
    Dr. Winkenwerder. We don't actually keep track of our costs 
in that way. We do have a good idea, a very good idea, of what 
it costs per person, per month. That is typically our cost 
accounting structure here in the United States for an active-
duty person, for a family member or for a retiree.
    Of course, that amount tends to increase with age and 
illness and medical condition. And that number has grown. On 
average, in the early 2000 period it was growing in double-
digit figures. More recently, it has grown at about seven 
percent or eight percent between last year and this year.
    But that number is--I don't have it in the back of my head, 
but it is $200-plus per person, per month. That is roughly what 
it would be. It is probably somewhat less than that in theater 
because the folks are healthy, by and large, and therefore 
should be less expensive.
    Ms. Shea-Porter. Then if we have an escalation, you would 
not be able to say how much more money would have to be 
allocated to cover the new troops.
    Dr. Winkenwerder. The additional troops that would result 
from any change in deployment strategy--whatever it is, I would 
wager an estimate that the cost of that would not be 
considerable, because we already have a fixed infrastructure 
there.
    There would probably be some additional medical support 
that would be needed, but we already have a fixed 
infrastructure that has capacity.
    Ms. Shea-Porter. I, too, am worried about this efficiency 
savings, et cetera. That doesn't look tangible to me right now.
    I also wanted to ask you about the mental health part of 
your budget. I am actually quite surprised to see the number of 
soldiers who have already accessed health care for post-
traumatic stress syndrome (PTSD). And if Vietnam is any 
indicator of what we can be looking at, this is a higher number 
that are seeking help already.
    But taking this out a year, two years and five years hence, 
are you seeing a great surge in the cost to provide health 
care? That is the first question.
    And the second question that I had was I have been told 
there are soldiers in theater who are being left behind on 
patrols because they have post-traumatic stress syndrome, and 
they are not receiving medical treatment for that. And I wanted 
to ask you if you could address that.
    Dr. Winkenwerder. Sure. The first part has to do with what 
we are seeing with respect to mental health trends and PTSD and 
other similar kinds of issues.
    We are spending more money. Our systems and reports tell me 
that the number of visits on an outpatient basis, the number of 
hospitalizations, the amounts that we are spending on 
pharmaceuticals are all going up for mental health services.
    Some of that is driven by the same kinds of things that are 
driving health-care trends upward more generally. Some is 
driven by the fact that we have a greater population that we 
are caring for today than we did in 2001 or 2002. I am 
comparing, let's say, 2002 versus 2006, the most recent year.
    And what we find is that the rate of outpatient usage has 
gone up about 20 percent. The rate of inpatient usage is 
roughly the same. The rate of pharmaceuticals has gone up about 
50 percent.
    But if you look at our total expenditures and how much is 
going for mental health four years or five years ago versus 
today, it was about 8.6 percent four years or five years ago. 
Today it is like 9.5 percent. So it has gone up a little bit as 
a share of the aggregate.
    And we are actively--that does not bother us. In fact, in 
my way of thinking, it is a good indicator because we are 
trying to reach out, expecting that people are going to have 
some mental health problems, and so we know we are actually 
promoting and incurring a certain higher use because of the 
things we are trying to do to help people. So that is a good 
thing, we believe.
    If I might say one other thing in terms of the rates of 
PTSD, because there is a lot of discussion and, frankly, there 
are a lot of things that are said out in the public, in the 
airwaves and the media, that are inaccurate, at least based on 
all the good data that we have.
    The best data are studies that have been published 
involving military research that have been published in the New 
England Journal and other very reputable medical journals that 
suggest that the rates are in the range of 10 percent, 12 
percent among our redeployers coming home. It is not half of 
all the people that are coming back; it is a fraction. And 
those are the facts of what we are seeing.
    Now, the other thing is that the way that most people 
respond who do have PTSD-type symptoms is they tend to have 
them for a period of time and, especially if they get some 
support and help and counseling, those symptoms resolve.
    For many people, they will resolve even without that. But 
our effort is to identify people, to support them, to help 
them.
    But the percentage of people who have chronic, debilitating 
symptoms and what you might call chronic post-traumatic stress 
disorder is really a pretty small number. I mean, it is in the 
low single digits based on the information I am familiar with.
    But I believe that our goal, our objective, should be to 
help every single person who has--whether it is PTSD, anxiety, 
depression, or is having problems with relationships or 
substance abuse--to reach out and identify those people early 
and to get help for them before they do things that could be 
really damaging to themselves, to their loved ones or to their 
life in general.
    Ms. Shea-Porter. I agree with you. I am just questioning 
about whether you are actually able to care for them with this 
budget.
    Thank you.
    Dr. Winkenwerder. Yes. The quick answer is yes, we have the 
sufficient funds and sufficient personnel to do a good job.
    Dr. Snyder. Thank you.
    Mr. Wilson.
    Mr. Wilson. Thank you, Mr. Chairman.
    And thank you, Doctor. And I am particularly happy to be 
here with you in that my second son was graduated from 
Uniformed Services University Medical School, and you were the 
keynote speaker, graduation speaker. And I am very pleased that 
he is currently serving now in Connecticut and studying 
barometric medicine. So we are very proud.
    I was very interested in seeing your report on partnership 
with the Department of Veterans Affairs (VA). And I have seen 
that firsthand in our state, how helpful that can be to 
veterans.
    And can you explain how that is proceeding? And what can we 
do to help promote this?
    Dr. Winkenwerder. Thank you. And thank you for the service 
that your son is providing. It is a great thing that he is 
doing.
    With respect to our work with the VA, in my humble 
judgment, I think that we have made tremendous progress working 
with the VA and cutting down or tearing down barriers and silos 
that would naturally exist with two large institutions, two 
large bureaucracies.
    We have dedicated leadership on these issues between what 
we call a joint executive committee chaired by Dr. Chu on the 
Department of Defense side and Secretary Mansfield on the 
Department of Veterans Affairs side.
    We have a health executive committee that I co-chair with 
the current acting undersecretary of the VA, Dr. Michael 
Kussman. We meet about every 3 months with both of these 
committees. We have a strategic plan. We have a series of 
things that we want to achieve, objectives. And we also 
measure, or we try to measure, what we do.
    Have we been completely successful in everything we have 
tried to do? No. We have had failures. We have had things that 
we wish had, you know, worked better or more quickly. But I 
believe we have made a lot of progress, and let me highlight 
what I think the progress is.
    First and foremost, I think the way in which we are 
communicating now for those who have serious and severe 
injuries, working between the DOD and the VA to transfer their 
care and to ensure that they get the care that they need when 
they move into the VA system from the DOD system--there are 
still some glitches, and there are still cases that come up. 
And when I hear about those cases, I am concerned and I wish I 
wouldn't hear about a case when it happens. But we try to jump 
on it and make the right thing happen.
    In the area of information-sharing, we are really, I think, 
doing great things that are very difficult in terms of--because 
we are capturing today a lot of information on the battlefield 
and down-range, as we call it, electronically--medical 
information. We are now able to transfer a fair amount of that 
medical information to the VA so that they have it within their 
system, so their doctors can access that information.
    Clinical practice guidelines, things that we are using, the 
same clinical guidelines to take care of certain things like 
PTSD.
    Sharing of facilities: A good example of that would be in 
the north Chicago area where we have one facility now that will 
be caring for both DOD beneficiaries and VA beneficiaries. And 
that is a model we would like to pursue and do in more places.
    Rather than building a new DOD facility or a new VA 
facility, let's look at how we combine our efforts and work out 
of one facility and actually one team of people. It is a new 
way of doing business.
    So those are a few of the things that we have done that we 
feel good about. But we are certainly open to ideas, 
suggestions and critique on the ways that we can do things 
better. Because it is going to be, in our judgment, an ongoing 
task, over who knows how long, that we are going to have to 
continue to work together closely.
    Mr. Wilson. Well, I know, Mr. Chairman, that, seeing how 
successful this is for geographic access, particularly in 
Secretary Jones's community of Charleston that I grew up in, 
that has really been very, very helpful, and so veterans and 
active-duty can receive services without travel.
    A final point: The Navy has directed cutting 901 billets in 
addition to the military-to-civilian conversion. How will this 
impact with the increase in the number of Marines that has been 
authorized?
    Dr. Winkenwerder. It is an issue that the Navy and the 
Marines will need to look at. Per the process in terms of the 
program of military positions being converted to civilian 
positions, it is a review by the service secretary at the end 
of everything cycle to certify that those transitions or those 
conversions do not cut into needed capability.
    And so each service secretary, independent from my office 
or any office within the Office of the Secretary, makes that 
judgment. So I fully believe that the secretary of the Navy, in 
looking at what might be a growing number of Marines to care 
for, will incorporate that increase requirement into the 
current plans to convert those positions.
    I wouldn't be surprised to see if the number of converted 
positions was reduced because of that. But that will be their 
decision, and we will be working with them to, you know, ensure 
that they conduct that analysis in an appropriate way.
    Mr. Wilson. Thank you very much.
    Dr. Snyder. Ms. Sanchez.
    Ms. Sanchez. Thank you, Mr. Chairman.
    I just want to associate myself with the comments that both 
you and the ranking member, Ms. Shea-Porter, and I don't know 
if Mr. Wilson said it, but this whole issue of the $2 billion 
cost savings that we are going to see in this upcoming budget.
    I mean, health costs, the way they are--I mean, we are 
lucky that you are saying that the increases are only 7 to 8 
percent a year, but if we are looking at that $2 billion over--
whether it is a $20 billion program or a $40 billion program, 
we are talking 5 percent to 10 percent, depending on how you 
cut it.
    That is a lot of money missing that, if we take a look 
historically, probably should be money that should be missing 
at this point, the way we have seen things spent around here. 
So I would just like to associate myself with the concerns that 
we have over that.
    I want to get back to this deployment post-traumatic stress 
disorder, because we are seeing it a lot in the soldiers who 
come back to California. And, as you know, it is not just in 
the active but in the national guard and the reservists that 
California has sent. We have the most members in the military 
coming out of California, so we have seen this quite a bit, in 
particular in the southern portion of our state.
    It is my understanding that when a service member returns 
from deployment, they fill out a post-deployment health 
assessment, which has a four-item PTSD screening tool. And it 
is my understanding that if you say ``yes'' to three out of the 
four that that is considered a positive screening for that.
    And in a Government Accountability Office (GAO) report from 
May of 2006, it reported that 22 percent of the service members 
who obtained a positive screening were referred for further 
mental health evaluation. And GAO recommended that the 
department identify which factors led to 22 percent of the 
positives being sent on to an additional screening versus 78 
percent who weren't.
    Can you tell us what you have determined, why 22 percent 
are being sent, 78 percent get to slide on this?
    Dr. Winkenwerder. Let me try to take everybody through this 
so that there is a clear understanding.
    The first point is that checking off the boxes, three out 
of four, would be an indicator that that individual needs to be 
interviewed very carefully and needs to have a very careful 
discussion with a medical provider, a medical professional, to 
make a determination based on what they hear about those 
symptoms or those reports as to whether that individual, in the 
provider's judgment, does, in fact, have that clinical problem 
or is likely----
    Ms. Sanchez. Does that happen----
    Dr. Winkenwerder. Yes. Yes. Everybody sees----
    Ms. Sanchez. Somebody sees----
    Dr. Winkenwerder. Yes.
    Ms. Sanchez. And in addition to that--you can answer this 
at this point--it says that providers are physicians, physician 
assistants, nurse practitioners, medical technicians with 
advanced training to provide treatment and administer 
medication.
    I mean, what does ``advanced training'' mean? Are these 
really psychologists and psychiatrists looking at them? Who is 
looking at them if you test positively and then you go in front 
of somebody to have the questions so somebody can sense what is 
going on?
    Dr. Winkenwerder. Well, let me get to completing what I was 
about to say, because the GAO report, in our judgment, got it 
wrong in terms of drawing the proper conclusion about who got 
referred and what sort of follow-up happened.
    What they failed to look at was the number of individuals 
who were referred back to their primary care physician, or who 
might have been referred to a chaplain, or who might have been 
referred to a group counseling session, or who might have been 
referred to Military One Source, or who might have been 
referred, you know, into the TRICARE network.
    Ms. Sanchez. So you are saying that the 22 percent didn't 
include any of these people?
    Dr. Winkenwerder. It did not. Their measurement did not 
incorporate all of that, so they pretty significantly 
undercounted the referrals. And that was a problem, and I am 
not sure they understood that completely when they did this 
study.
    We talked to them about it. Unfortunately, when the study 
was published, it got leaked to the press before we had our 
comments to explain what had happened.
    But that point aside, what we find from looking at service 
members again, not just when they come back on redeployment, 
but we have instituted a third evaluation that occurs in the 
three-month to six-month timeframe--we call it the post-
deployment health reassessment. And it is a process that has 
been in place now for a couple of years, and we are catching up 
with a backlog from prior deployers. We have screened about 
200,000 people.
    What we find in that process is very interesting. We find 
higher rates of, actually, symptoms of physical and mental 
symptoms than immediately when people come back, confirming our 
suspicion that, many times, when people come back, they check 
the boxes because they want to get back to their family and 
they want to go on. We know that.
    So this is an effort to reach out again, to really bring 
people in, to say, ``How are you doing? How are things going 
with your family? Are you having physical or mental problems?'' 
And what we find in that process is about 50 percent of people 
have either a physical or a mental concern.
    But, like most of us, when we go to the doctor with a 
concern, it is most of the time not a diagnosable medical 
problem. And so, for example, in the area of physical health, 
what we find is about 53 percent express a concern about their 
physical health. But in terms of a provider, in this case a 
doctor, making a diagnosis, it is only about 10 percent. So 
most people need the reassurance that what they have is not, 
you know, a diagnosed condition. In the area of mental health, 
where about 34 percent had expressed a concern, only about 6 
percent or 7 percent were a diagnosed condition.
    Now, obviously, we are looking at all this. We are 
following a lot of data and a lot of trends. And there are 
other studies that are going on, so that we try to get it right 
and make sure that everybody who is seen who needs a referral 
gets a referral.
    Everybody that goes through that process, almost one-third, 
about 30 percent, do get referred for either physical health 
follow-up or mental follow-up or some other kind of referral.
    So that tells me that that is a pretty robust process. I 
mean, it is not as if people are just sort of cycling through 
and then they are being sent back to their unit. Many of them, 
almost one-third, are being referred on.
    So we are going to continue to look at this. Many of these 
things we are doing for the first time. Nobody else has ever 
done this kind of work. And so we are learning as we go along. 
We think we are, you know, reaching out to most who need it.
    Ms. Sanchez. Thank you, Mr. Chairman.
    Dr. Snyder. Ms. Drake.
    Mrs. Drake. Thank you, Mr. Chairman.
    Dr. Winkenwerder, it is nice to see you again.
    Dr. Winkenwerder. Good to see you.
    Mrs. Drake. And it is really because of this committee that 
I learned about Health Net. And I know we have representatives 
out there today. And I want you to know they have been very 
helpful in the 2nd District of Virginia, working with our 
Portsmouth Naval Hospital, with our doctors. And they really 
are a resource for all of us, if you would want to follow 
through with that in your own districts.
    I mean, they have really worked on things that--like 
ultrasounds for our military weren't automatically done, only 
if it was high-risk; other high-risk pregnancies; and just 
different issues we have worked on. And we have seen things 
working a little bit better.
    It was also good to know that one of the things they are 
working on right now is payment to the doctors electronically, 
so they are paid very, very quickly, because we all know the 
challenges we have had of getting doctors to agree to 
participate in TRICARE. And it doesn't matter what your health 
system is if you can't get the doctors to provide the service. 
So I thought that was something that--I was very pleased to 
hear what they were doing.
    We have all talked a lot about the task force. We have 
talked about the increase in end-strength. Can you tell me how 
those two mesh together? Is the task force using that increase 
in end-strength long-term in looking at the viability of our 
medical care system?
    I mean, we are talking about it; you have put money in it. 
But is the task force also focusing on that? And how it will 
impact total cost?
    Dr. Winkenwerder. In my estimation, they will be looking at 
that. There are not a lot of data at this point that would tell 
us in a precise way what the additional cost burden will be 
because of this additional end-strength. I think we can 
probably impute what we think that might mean on the basis of 
our current experience with our current end-strength.
    Mrs. Drake. I just want to make sure they factor it in, 
because when they were charged to do this, it was before the 
increase in end-strength----
    Dr. Winkenwerder. That is correct.
    Mrs. Drake [continuing]. And to just make sure the 
information they have factors that in and that they get a good 
product in the end.
    Dr. Winkenwerder. That is correct.
    And I think there is no question but that it will increase 
cost in the health-care system, because we will be supporting 
more active-duty and their families, and that will cost more 
money. I don't have a number to project.
    And of course, this rolls in over a period of four years or 
five years, so we have to do some analysis. We have not done 
that yet, but we will do it.
    Mrs. Drake. I just want to make sure they look at that----
    Dr. Winkenwerder. Yes.
    Mrs. Drake [continuing]. Since it is not right now. It is 
not the present.
    Dr. Winkenwerder. Yes.
    Mrs. Drake. The other question I have--because you did make 
the comment we all know what the answer is, and certainly we 
have struggled with this issue, and we are very concerned about 
the care provided to our military and our retirees and their 
families.
    What are military members told in recent years when they 
sign up to join the military? Are they told, ``You are going to 
have affordable health care''? Are they told, ``You have health 
care''? What are they told, and what is their expectation?
    I would just like to know that, moving forward to how do we 
deal with the amount of money that it takes and----
    Dr. Winkenwerder. Right.
    Mrs. Drake [continuing]. Any proposals that you may make 
about prescription drugs. What are they expecting, based on 
what they have been told?
    Dr. Winkenwerder. I am going to be real honest. Since I 
don't work directly with our recruiting community, I don't know 
exactly what they are told.
    My best guess is they are told that they would have, upon 
joining the military, access to an outstanding health-care 
benefit and health-care program, ability to see world-class 
doctors in world-class facilities, with essentially no cost-
sharing as long as they are an active-duty service member, and 
for their families with, similarly, little to no cost-sharing, 
except that they use the TRICARE network.
    And I expect that they are presented information about the 
TRICARE benefit. I would also expect that they would be told 
that, you know, if you serve 20 years, you will have access to 
a benefit that would be for life.
    Mrs. Drake. I think that is important for us, in answering 
the question of what are we providing and how are we doing it, 
to know what their expectation is. And we know what our older 
veterans thought, that everything would be free the rest of 
their life. We know that is not said anymore.
    But I just didn't know what is their expectation now. I 
mean, I would just like to get that. You can answer that later.
    Dr. Winkenwerder. It is a good question. We will get good 
information for you on exactly what people are being told.
    But I endorse your implied message, that people ought to be 
told that they have a benefit and they have coverage for health 
care, but not necessarily that they have a free health care for 
a lifetime, because that is not true. That is not accurate.
    [The information referred to can be found in the Appendix 
beginning on page 67.]
    Mrs. Drake. Thank you.
    My time is up, Mr. Chairman.
    Dr. Snyder. Dr. Winkenwerder, since on Thursday we are 
going to have our recruiting/retention hearing, you might want 
to pass on to Dr. Chu----
    Dr. Winkenwerder. We will pass that on.
    Dr. Snyder [continuing]. And the folks that Ms. Drake may 
have a question for them.
    Dr. Winkenwerder. We will do that.
    Dr. Snyder. Go ahead and start the clock again.
    Mr. Jones has not returned?
    I had several questions, not in any particular order, Dr. 
Winkenwerder. I want to ask you a question about autism. You 
all, I think, have a study going on about the services. Is that 
due in April?
    Is that correct, Debra?
    The study is due to come out from you all in April or 
somewhere in that timeframe?
    Dr. Winkenwerder. I think that is about right, yes.
    Dr. Snyder. Is that actively ongoing right now?
    Dr. Winkenwerder. Yes. We were directed by Congress to 
establish a task force, I believe, to look into the matter of 
applied behavioral analysis, a therapeutic approach to support 
children with autism.
    Dr. Snyder. And the whole issue of autism and how----
    Dr. Winkenwerder. Yes. Yes.
    Dr. Snyder. Yes, because in some ways that illustrates the 
challenges we have, because you want to have the best quality 
you can, and sometimes that means that you are going to--well, 
I think it does mean you all are going to be the leaders in an 
area.
    And if you reach the conclusion--and I suspect that you 
probably will--that the evidence is there that that kind of 
therapy is effective, then that is a financial burden on the 
system.
    Dr. Winkenwerder. That is right.
    Dr. Snyder. And so I look forward to that, and I suspect it 
will be, you know, a fair-minded review of that whole issue.
    And it becomes even more of an issue when we know that the 
diagnosis of autism continues, certainly has gone up over the 
last few years, and I believe a lot of our military kids are 
involved also.
    One specific issue from your statement--I thought the 
satisfaction surveys that you all do seem to be good. And I 
asked my office, you know, how many complaints we hear about 
military medicine. We don't hear a whole lot in our office. And 
we do have both guard, reserve and an active base in my 
district.
    But the satisfaction levels, by your own testimony, were 
slightly lower than civilian ones. It doesn't look to me like 
it is overwhelming, but I just wanted to ask, have you 
identified something--and maybe it is just the nature of moving 
around or something. What is your response to that?
    Dr. Winkenwerder. Yes. Again, that is compared to a high-
level benchmark, not to an average.
    Dr. Snyder. That is good.
    Dr. Winkenwerder. And we know in the clinical areas in a 
number of different specialty components that our performance 
is very high, relative to any, you know, any civilian 
benchmark.
    It would be my judgment that where we have satisfaction 
levels that are not at the top of the benchmark, what is 
driving that, I think it is probably mostly related to timely 
access and the availability to get in very quickly. Some of 
that is driven by people's expectations.
    Interestingly, our retirees--and the older the retiree 
group, apparently, the more satisfied. Our retirees are the 
most satisfied.
    Those that seem to be the least are the active-duty service 
members and their families, who you would think would have the 
most immediate access. But I think probably because of the 
hectic nature of their life and all their other duties and 
problems they, you know, are very much focused on getting in 
very quickly and getting out very quickly.
    Now, the services and the surgeons general--you can ask 
them about this when they come testify--but they are working on 
trying to improve that access, timely access, and making it 
easier for people to get in and out.
    Part of it is making sure that the provider's schedule is 
open to see patients. It is just the mechanics of getting 
people appointments. It is managing the staffing levels, having 
telephones that are always answered, all those things.
    But they are applying, in some cases, really good Lean Six 
Sigma tools, for example, the Army is, to really hit on that 
very issue. And I think that is where most of it is.
    People seem to give us very good ratings when it comes to 
the administrative part of, like, paying claims and getting 
claims paid, and that part seems to be working very well. But 
it is probably more in the access to care.
    Dr. Snyder. One of the questions that came up with 
Secretary Gates the other day that I wanted to ask about--and 
he was not aware of and was concerned about--and I will tell 
you exactly where it is. It is on page 53 of the analytical 
perspectives of the President's budget.
    But it is where they compare research dollars per all the 
departments of government. In the Department of Defense budget, 
basic research had a cut of nine percent. Applied research had 
a cut of 18 percent.
    And Secretary Gates was unaware of that and said it was 
something he was personally going to look at, and he related 
his experience as the head of a large research institute.
    But that really concerns me as we are looking ahead in 
terms of the edge of our--you know, what is our technological 
edge in terms of war-fighting, and we are, you know, looking 
ahead a decade and two and three and four. That is really our 
seed corn.
    I, frankly, don't know where your number is with research 
in your medical budget, but does that relate--are you all part 
of that cut, or how do you see the research number for----
    Dr. Winkenwerder. I don't know if we are part of that, so I 
don't have an answer for you on that. But I would share your 
concern about investment in research and the need to keep that 
number going up.
    I don't know this for a fact, but I would suspect that it 
may be other competing priorities, bills that have to be paid, 
whether it is for repair of equipment and the like, or whether 
it is, in our case, again, paying for bills for everyday 
medical care in the TRICARE network and our cost-sharing 
structure that, you know, makes it difficult for us to increase 
that investment on the R&D side.
    I believe we need to invest more dollars. That is critical. 
Where we have done that, there is no question but it is making 
a difference and saving lives today--the things that we have 
done, for example, in hemorrhage control.
    We are gaining the fruit and the benefits of things that 
were done three, four, five, ten years ago, and then we see it, 
and we are able to apply it, sometimes bring forward those 
things very quickly.
    But unless we keep the research going, we are not going to 
get those benefits. And so, we need to do that.
    Dr. Snyder. I shared my concern today with Mr. Spratt, the 
chairman of the Budget Committee, and he is concerned also.
    Ms. Davis, did we ambush you?
    Ms. Davis of California. You did ambush me, Mr. Chairman. 
That is all right.
    I am sorry that I missed the beginning of the hearing and 
haven't had a chance to hear your remarks or the questions.
    I think one of the things that particularly strikes me and 
I know that you have tried to address before is really our 
pipeline of physicians who will be available to care for our 
dependents, for our families, obviously, for our men and women 
in uniform, so that that benefit which we hold dear for those 
in uniform will always be there.
    Perhaps you have already addressed that.
    Dr. Winkenwerder. No, I have not, actually.
    Ms. Davis of California. If you could do that, that would 
be helpful.
    I saw in the notes that bonuses are being increased.
    Dr. Winkenwerder. Yes.
    Ms. Davis of California. Recruiting continues to be a 
concern. And what else can we do? And why do you think that is 
becoming such a problem? Is it partly the perception that our 
medical professionals will be brought into the war theater? Is 
that part of the difficulty?
    Dr. Winkenwerder. I don't think it is. I think it has more 
to do with our ability to compete on the basis of compensation. 
I really do.
    And this is particularly true with the specialties that are 
more highly compensated. We have less challenge, candidly, for 
pediatricians and family practitioners and internists. We are, 
in some cases, overstaffed in those areas. But when it comes to 
orthopedic surgeons, radiologists, general surgeons, 
anesthesiologists, this is where we have trouble and a 
challenge.
    Now, we are relatively well-staffed, but I am not as 
comfortable as I would like to be about the future, two, three, 
five, ten years down the line, because we do need that pipeline 
of people.
    These new authorities that you in Congress granted us we 
very much appreciate. We believe it will be helpful.
    However, one of our challenges is that, within our 
structure, the decisions about granting those bonuses and using 
those funds resides within the line of each service. And so, if 
there is a competition for dollars, let's say, for example, 
within the Army because of all the things the Army has to pay 
for, there may be--and I am not picking on the Army; I am just 
using that as an example. But there may be a reluctance to free 
up those dollars to be used for that purpose.
    The flexibility is there. The authority is there. But 
people are not stepping forward to give the medical community 
the funds to recruit people. And we have a long tail of 
training.
    So that is a concern I have, and we would appreciate any 
thoughts or suggestions you have on that front. We want to work 
with you on that.
    I will say that one of our most solid sources of that 
pipeline for the future is the Uniformed Services University. 
It is really a key asset for us. Today, close to 25 percent of 
all military physicians are graduates of the Uniformed Services 
University. And when you go into the senior officer ranks, the 
proportion even goes higher: 30, 35 percent. And if you look at 
the current promotions to colonel today, a significant 
proportion come out of that program.
    So the university is an important asset that we need to 
properly fund, nourish and continue into the future.
    Ms. Davis of California. I appreciate that.
    If I could just turn for a second to mental health coverage 
and the outreach.
    And, Mr. Chairman, have you already discussed this a little 
bit?
    Dr. Snyder. He has talked about it quite a bit. I would 
like to hear--your perspective is an important one. Go ahead 
and wade on in.
    Ms. Davis of California. Well, in the background I think it 
was mentioned that we offer an interview to people, we ask 
them, ``How are you feeling? How are you doing?''
    We also know that, at least at one point, I think, people 
were told, ``Do you have any problems? If so, you know, come 
into treatment. If not, go home.'' And, you know, that is a 
tough choice, I think, for people to make.
    Dr. Winkenwerder. Right.
    Ms. Davis of California. Can you give me a better sense? 
Out of the returning soldiers, men, women in uniform, what 
percentage of them actually--not necessarily are having 
adjustment problems but just are asking for interviews, are 
seeking help?
    And what kind of follow-up do you have that would suggest 
that we either have the resources out there--and I know that in 
urban centers they may be there. They may not be there in rural 
counties.
    What is the whole picture there? And what ought we be 
focusing on?
    Dr. Winkenwerder. The whole picture is, number one, we 
recognize that this is a top priority, and we have recognized 
it. Our efforts, if you look at where we are today, they are a 
reflection of the decisions we made two, three, four years ago 
in some cases.
    Early on in this conflict, we recognized that we were going 
to have a mental health burden, and so we began to incorporate 
changes in our program. We have a much more robust in-theater 
mental health support today and mental health professionals 
embedded in our units, again, to deal with some issues that 
happen right then and there, not wait two months or six months 
or a year until people get back home. So that is one change, a 
much more aggressive approach in-theater.
    Second is the post-deployment assessment, and then now a 
third leg, a reassessment, at three to six months after people 
get back, where we reach out and bring them in to fill out 
questionnaires and with a face-to-face interview or session 
with a medical professional.
    We have research that is going on to study that we didn't 
have 10, 15, 20 years ago, certainly not during Vietnam. We are 
more aggressive with the use of medications.
    We have, I think, been more specific recently, in terms of 
guidance about who should be redeployed if they have certain 
kinds of symptoms or they require certain kinds of medications 
and they need to come home, or that they shouldn't redeploy or, 
you know, deploy for the first time if they have certain kinds 
of mental health problems.
    There is a much higher recognition of all these issues. I 
think we are making real nice progress, cutting through some of 
the stigma.
    And, again, we can stand up and talk about in the medical 
community these issues all day long, but ultimately it is 
whether our line leadership embraces this as a philosophy. And 
I actually will tell you I believe that they have at the 
highest levels.
    Now, is it complete and across the board? No. I have no 
doubt that there are colonels and captains and sergeants in 
places who don't get it yet. And, you know, it is a balance, 
because clearly you do have to be tough, you have to be 
mentally tough, you have to be resilient to deal with the 
rigors of being a service member and going to war.
    But that has to be balanced against when you are really 
having such difficulty that you can't perform your job or duty, 
or you are having huge relationship issues, or you are a risk 
to yourself or other people. So you have to be able to identify 
those issues and pull those people out, get them support, and 
help them so that they, you know, can either return to duty or 
that they can hopefully lead a normal life.
    And that is our focus. We have a lot of programs. Do we 
know how they are all working? We are learning. But I think it 
is going to be some time before we know, you know, the impact 
of all of these things that we are doing, which are, in many 
cases, the first time that they have been done.
    Dr. Snyder. Mr. McHugh.
    Mr. McHugh. Thank you, Mr. Chairman.
    Let me blend two themes here. I heard, understandably, a 
number of members, Ms. Davis most recently, concerned about 
mental health. It is an issue. We know the suicide rates for 
the Army in Iraq, and we are all concerned. I know you are as 
well.
    If you look at that issue in the context of the mention I 
made in my opening comments about military-civilian 
conversions, the schedule for those from 2006 to 2009 calls for 
342 military mental health positions to become civilian 
positions over the total of that 4-year inclusive period.
    There is obviously no guarantee those positions are going 
to be filled on a one-to-one or a two-to-one or whatever ratio 
it may be. But even if they are filled one-to-one, I think we 
can say with certainty the number of deployable mental health 
professionals will be depleted--or, not depleted, but reduced.
    So I am just curious, has there been any re-evaluation on 
that? I mean, 2006 is not where we are in 2007. I understand 
times change. But what kind of look-see is your office, your 
department, doing to make sure that we are going to not 
unnecessarily and very harmfully erode the ability and the 
availability of mental health positions, particularly in 
deployed areas, particularly given the surge that we have 
talked a little bit about here today?
    So, your comments on that?
    Dr. Winkenwerder. Well, you raise a very good point and a 
very good concern. And I think we do need to take a look at 
that. We definitely don't want to go short or find ourselves in 
a position where we have insufficient military personnel, 
military-trained personnel, who can deploy or who can attend to 
the specific needs of military service members. And so, we need 
to look at that.
    I would be happy to take that issue or that question and 
refer it back again to the Army. I don't know where the numbers 
came from, if there were more from one service or another. But 
we I will look into that----
    [The information referred to can be found in the Appendix 
beginning on page 66.]
    Mr. McHugh. That is fine.
    Dr. Winkenwerder [continuing]. Because I think you raise a 
very good point.
    Mr. McHugh. That is fine. And I know we would all 
appreciate that, absolutely. And we don't want any guessing or 
such, because it is an important issue. I know you realize that 
most of all. So please do that.
    And let me switch a little bit, if I might. We talked about 
the $1.8 billion in assumed savings because of the task force. 
You have almost $300 million in other undefined initiatives.
    But the budget also includes nearly a quarter of a billion 
dollars, $248 million, in efficiencies from the military 
treatment facilities. Those are undefined. We had similar 
undefined efficiencies listed in the 2006 budget, as well as 
the 2007 budget. The year 2006 was $94 million. We are done 
with 2006.
    And this is probably a tough question. You may have to take 
this for the record, as well. But can you give us an idea of 
how much of the $94 million, if any, did we achieve in 
efficiencies in the 2006 budget? What did you do to reach them? 
And what kind of efficiencies are we talking about when you are 
looking at $248 million for next year's budget?
    Dr. Winkenwerder. I am going to have to take that one for 
the record.
    [The information referred to can be found in the Appendix 
beginning on page 66.]
    Mr. McHugh. That is fair.
    Dr. Winkenwerder. But I will give you my best thought about 
that.
    The way the numbers were developed for the efficiency goals 
and what we call the efficiency wedge, going out over several 
years, was to take a look at what it cost to purchase services 
in the network and then, if we were to purchase those same 
services, if you will, in our own facilities, how much would it 
cost.
    And what we found was a gap. In other words, it cost more 
money to provide these services internally, or at least, maybe 
stated a better way, there was a proportion of the total 
dollars spent inside the system that could not be fully 
explained.
    Some of that we know goes for things that are not 
compensated or billed for. They are things that relate to 
protecting our force, some of the public health issues, some of 
the force protection issues--lots of things that we do that you 
can't or don't bill for, so to speak.
    And so we are trying to count, and we have had an ongoing 
process to better account for all of those things.
    Having said that, our services looked at that issue two or 
three years ago and came up with what they believed were some 
efficiencies they could achieve either through increased 
productivity, through doing things more efficiently, delivering 
the care more efficiently. And the precise undergirding for 
those efficiencies is something that was developed by each of 
the services.
    So we can try to obtain that information for you, but it 
was a commitment that they made to those targets based on 
productivity and efficiency targets that they believed that 
they could achieve.
    Mr. McHugh. So they developed the targets. You did not 
dictate the targets.
    Dr. Winkenwerder. It was a process.
    Mr. McHugh. You didn't say we----
    Dr. Winkenwerder. You know, it wasn't one or the other. It 
was a negotiated process.
    Mr. McHugh. Democratic dictatorship.
    Dr. Winkenwerder. We are always democratic.
    Mr. McHugh. Well, I appreciate that.
    Just a final comment. If you could get the figures as to 
what we did save in 2006 and what we did to save them, and also 
what the target is, where the target areas lie with respect to 
the $248 million for next year.
    Dr. Winkenwerder. I would be glad to do that.
    [The information referred to can be found in the Appendix 
beginning on page 66.]
    Mr. McHugh. Thank you, sir.
    Dr. Winkenwerder. Thank you.
    Mr. McHugh. Thank you, Mr. Chairman.
    Dr. Snyder. Ms. Drake.
    Mrs. Drake. Thank you, Mr. Chairman.
    I think it has been, what, about 1.5 years since we opened 
up TRICARE to reservists outside of their window of activation? 
Can you give us an update? Is that widely used or is it very 
little?
    Dr. Winkenwerder. It is being used, and it is growing. We 
have, I believe, about 34,000 or 35,000 beneficiaries in the 
new TRICARE Reserve Select program. And so, people are joining.
    My recollection, however, is that the rate of growth of 
that program is not as great as we thought that it might be. 
But we are clearly reaching out to people in a very systematic 
way, particularly when they return home and for guard and 
reserve who might go back into the civilian sector, to make 
them aware that this is a benefit that they have, if they 
choose it.
    What we find, however, is that most people seem to prefer 
their civilian health-care benefit program. And I am not sure 
we know exactly why that is, but it is not to say that people 
don't like the TRICARE program. They do. I think we hear good 
comments on that as well.
    But that is about where it is right now. And we think it is 
working well.
    Obviously, Congress passed some additional changes last 
year that changed the cost-sharing structure on that so that it 
is 28 percent of the premium overall for all guard and reserve 
who might choose to join TRICARE Reserve benefit.
    Mrs. Drake. So that may increase as they----
    Dr. Winkenwerder. My guess is that it definitely would, 
yes.
    Mrs. Drake. All right. Well, thank you very much.
    Thank you, Mr. Chairman.
    Dr. Winkenwerder. Thank you.
    Dr. Snyder. Ms. Davis, your number has come up again.
    Ms. Davis of California. I am going to pass right now, Mr. 
Chairman. Do you want to go ahead and----
    Dr. Snyder. Yes.
    Dr. Winkenwerder, Mr. Wilson asked you about the DOD-VA 
interface, and this is a topic that has been important to Mr. 
McHugh and others. And you said that if anyone has suggestions 
on how to look at that--I appreciate that openness.
    But as you look ahead now--you gave a list of things that 
you would like. As you look ahead, what are things on a to-do 
list with regard to improving things at the DOD-VA interface? 
And how much impact do you think those particular things on 
your list will have on either quality or seamlessness or cost 
savings?
    Dr. Winkenwerder. I would outline for you four areas.
    The first is in the area of joint markets and the 
opportunity for joint facilities.
    So what we have in Chicago, for example, I think is a model 
that could potentially be duplicated in other places like 
southern Mississippi, the Biloxi-Gulfport area, the VA facility 
there. There is a Keesler Air Force facility there.
    The same thing is true in Denver, Las Vegas. There are 
several other locations we are looking at and developing a 
priority list of places that we really ought to get serious 
about accelerating that effort and that model.
    The second area would relate to our joint efforts in the 
electronic health record system. Secretary Nicholson and I made 
an announcement the week before last that we are going to 
pursue jointly developing a new inpatient module for our 
electronic health records system.
    In our case, we have a limited capability on the inpatient 
side. Our system is primarily an outpatient records system. It 
is doing a great job for us. We have it deployed world-wide. 
But what is before us is the need to develop the in-patient 
side.
    The VA, on the other hand, has a great system. They are 
needing to modify, update, as I understand it, their platform. 
And rather than us doing that separately, we want to pursue 
doing it together. We think we can save a lot of money and help 
set standards for electronic health records across the country 
by doing that. So that is another area.
    Third, I would say, is our obligation to make further 
improvements in the way we take care of the severely injured 
and in the area of traumatic brain injury, which is what we are 
just learning more about.
    And in my judgment, we need to improve our screening 
process and our screening tools, and follow up and invest more 
in research on traumatic brain injury. And we are beginning to 
do that.
    And then finally, I think, as we have talked about, in the 
area of mental health and our shared responsibility in the area 
of mental health to ensure that all those who have mental 
health problems or concerns or identified diagnosed conditions 
get the support that they need and that they be given the best 
possible chance for a full recovery from their mental problems.
    So those are the--and we in the VA have talked about that, 
so what I am telling you, if you were to ask the same question 
to Dr. Kussman or even to Secretary Nicholson, I think you 
would hear the same shared agenda. We are going to be talking 
more about this in the very near future of our agenda to be 
more aggressive in these areas.
    Dr. Snyder. I think that is a--I know that, as I have 
mentioned, Mr. McHugh has a great interest in--I am on the VA 
Committee also, and we may well want to have our further formal 
discussions on that specific topic.
    On another unrelated question, in your written statement, 
you used the phrase, talking about these changes of cost-
sharing and all that, you used the word ``aligned,'' I think 
was your word, ``align'' the premiums with private health 
insurance plan. How do you define ``aligned''?
    Dr. Winkenwerder. Well, what that means to me is it means a 
relationship that is consistent over time.
    And that does not mean the same level of cost-sharing. It 
just means that if, for example, what we ask of people today, 
as I think we talked about, is in the range of 10 percent to 12 
percent of their cost, of the total cost of the program, is 
what they share in their--personally.
    It had been around 25 percent, 26 percent. In our judgment, 
that needs to increase. But at some point, that increase ought 
to level off, and then it ought to stay leveled off.
    In our judgment, the cost-sharing requirement for our 
military retirees ought to be less than it is for the best 
civilian programs. We believe that is what our retirees and 
those who have served this country deserve.
    On the other hand, we don't believe we can afford the cost-
sharing to continue to go down relative to the cost of the 
whole benefit.
    So that is what I meant when I said ``aligned.'' It means 
that the relationship is consistent over time and that it 
represents a consistent relationship between our cost structure 
and that that you would see in a civilian private-sector health 
plan.
    Dr. Snyder. Mr. McHugh.
    Mr. McHugh. Thank you, Mr. Chairman.
    Mr. Chairman, I appreciate your comment about the DOD and 
VA sharing initiative. And in fairness to Secretary 
Winkenwerder and Nicholson, they have stepped forward and are 
trying to do some things--and I know there was some very deeply 
ingrained and I would hope not insurmountable--although, after 
now, in my 15th year, having watched the struggle, they may be 
insurmountable differences--but there is so much that can be 
done, and I want to see that progress continue.
    But you mentioned that feasibility study. Quick question: 
When will that be done? I know you have just announced it, but 
what is your timeframe on that?
    Dr. Winkenwerder. Not long. We think----
    Mr. McHugh. Not another 15 years, then.
    Dr. Winkenwerder. No, no, no. Within the next 60 days. We 
really think that this is something that we ought to look at 
pretty quickly. It is really a study and look at our respective 
requirements.
    And so we jointly are pushing the technical folks and the 
Information Technology (I.T.) communities of both the DOD and 
the VA to let a contract to do that work and to come back to 
us.
    Our people and the people at the VA talk together all the 
time. They know each other. And we know that what is shared 
between us is far greater than what is different.
    There is a lot of overlap in terms of what we expect the 
requirements to be. There are some differences. We have some 
things that we do that are out in the field that the VA 
providers just don't need to do. We know that. We have 
requirements for certain kinds of medical care, for example, 
for Obstetrics-Gynecology (OB-GYN) or for pediatrics, and that 
is not something that the VA does much of. And they have some 
issues, probably, on the chronic end of the field.
    But there is, we think, probably a 90 percent overlap. But 
we want to define all those requirements and say, ``Okay, how 
do we have it go forward?''
    Mr. McHugh. And you do have a significant software--well, 
hardware challenge, too, on your databases, because you were 
kind about the VA's system, but, as I understand it, there is 
not a set of it off the shelf. I mean, they----
    Dr. Winkenwerder. That is right. And I don't want to speak 
for them, but I think they may be looking to make some changes 
in some of those approaches.
    Mr. McHugh. Right. Yes, it wasn't a criticism, more of an 
observation. I mean, I was just----
    Dr. Winkenwerder. No, it works very well, I am told, for 
them. But we are both spending a fair amount of money, and so 
we think the taxpayers' money will be better spent if we do 
this jointly. And at the same time, we can help set standards 
for the rest of the country.
    Mr. McHugh. Yes. We want quality of care and fewer medical 
errors, all that good stuff. Anyway, I will be looking forward 
to that report.
    I mentioned concern about military-civilian conversions on 
mental health, but you have a pretty broad-range proposal, as I 
mentioned in my opening comments.
    Does this budget assume any savings from the military-
civilian conversions? If so, how much? If it does, we can't 
discern that.
    Dr. Winkenwerder. No.
    Mr. McHugh. It does not.
    Dr. Winkenwerder. It does not.
    Mr. McHugh. Thank you.
    Mr. Chairman, that is it.
    Dr. Snyder. Ms. Davis.
    Ms. Davis of California. Could you go back to that, then, 
in terms of those conversions? Were you anticipating that there 
would be savings, or may that shift?
    Dr. Winkenwerder. I think there are some savings.
    Mr. Middleton.
    We think there may be some cost savings, but we have not 
programmed that into the out-years. So right now it is cost-
neutral.
    Ms. Davis of California. But that wasn't the primary reason 
for making that shift.
    Dr. Winkenwerder. No. It really was not a budget-driven 
exercise. It was more to the question of, what is military-
essential and what things can be done by civilians?
    And it only makes sense to harvest all those things that 
could be done by civilians--to have civilians do them so that 
we can use military billets, military positions, for things 
that we really want the military to do. That was the driving 
thrust for it.
    And of course, this military-civilian conversion effort 
does not apply just to the military health system. It applies 
across DOD.
    I will say that I think we are one of the areas that has 
embraced this the most aggressively, because we do think that 
there is some significant opportunities----
    Ms. Davis of California. Do you also see some down sides?
    Dr. Winkenwerder. Well, there is some risk, but what we 
have agreed to--and when I say ``we,'' I mean myself, Dr. Chu, 
the service secretaries, our leadership--is that this needs to 
be done in a careful way. We need to look at it every year to 
see how we are coming on this pathway.
    We need to look at the experience of the services with 
respect to whether they are able to hire the civilians, and how 
effectively are we executing, and are we harming or cutting 
into any of the things that Congressman McHugh talked about.
    So I think we have set targets that we think are realistic, 
but we want to review them on an annual basis.
    Ms. Davis of California. Thank you.
    I guess my time is up, Mr. Chairman.
    Dr. Winkenwerder. If I might say one other thing, I wanted 
to bring up, because you talked about mental health, if I 
might, just to----
    Dr. Snyder. Yes. Go ahead.
    Ms. Davis of California. Okay.
    Dr. Snyder. Mr. McHugh has no further questions.
    Dr. Winkenwerder [continuing]. To note that we do have, at 
Congress's direction, a mental health task force that is co-
chaired by General Kiley, Army surgeon general, and--I am 
sorry, I can't recall the name of the other co-chair.
    But it is a very robust effort to look at the totality of 
what we are doing in the mental health area. They have gone out 
and had sessions with the various communities around the 
country to get feedback. And so, it has been a very robust 
process.
    They will be coming forward with recommendations later this 
year on any changes we should make, any additional things that 
we should be doing. I am sure they will look at everything.
    Ms. Davis of California. Yes.
    Dr. Winkenwerder. And we look forward to that.
    Ms. Davis of California. I am glad to hear that. And also I 
know to really tap the ideas and best practices that people are 
using at home----
    Dr. Winkenwerder. Sure.
    Ms. Davis of California [continuing]. And how our spouses 
are able to work through many of those problems.
    I think one of the other issues that has been raised, at 
least in San Diego and I am sure in other communities, is that 
rather than going even through the military system, people have 
sought outside help because they are not comfortable, they are 
afraid of word getting back to commanders, whatever that might 
be.
    Dr. Winkenwerder. Sure.
    Ms. Davis of California. And so, how do you incorporate 
that into the thinking of what is really going on? And what 
kind of assistance do people need?
    Dr. Winkenwerder. Well, one common principle that we want 
to pursue--we believe we have--is that people ought to have 
access in as many different ways as we can devise or as are 
available to get the support and care they need.
    Mental health is a--yes, it is a sensitive issue. And as 
much as we try to work through the stigma, I think most of us 
would not go around saying, you know, ``I have a mental health 
problem.'' You know, it is just not something most people are 
comfortable doing.
    We have to work to try to remove that stigma. We are trying 
to do that. But we want to have the chance for people to access 
those services in a confidential way, if that is what they 
choose to do.
    Ms. Davis of California. And are you comfortable that the 
budget that is proposed is----
    Dr. Winkenwerder. Yes, I am. I am comfortable. Right now, I 
have not gotten any feedback from our medical leadership that 
they don't have the resources they need to perform those 
functions.
    Ms. Davis of California. Thank you.
    Thank you, Mr. Chairman.
    Dr. Snyder. Dr. Winkenwerder, one specific question, if you 
could educate me on it, with regard to electronic medical 
records. This came up with Secretary Nicholson at the Veterans 
Committee last week, and he talked about their--an electronic 
record will be a prospective one, which--people come in with 
this thick of handwriting for the last 20 years or something. 
And I think I understood what he meant.
    Is there anything inherently different in either the 
military health-care system or the VA system, to your 
knowledge, in terms of dealing with that issue, in terms of a 
transition from a handwritten inpatient or outpatient medical 
record to an electronically based medical record?
    Dr. Winkenwerder. Well, first of all, I can't answer 
exactly how they are dealing with that issue. But I will say 
that it is a big and difficult issue.
    First, there is just the transition of providers and 
changing business process and changing culture for the doctors, 
nurses, technicians, everybody, to use and do things, 
everything, with a computer, either a laptop or a handheld, so 
that changes the process of care.
    But in addition to that, it just changes things for the 
patient, changes things for everybody.
    And I have lost my train of thought here.
    Dr. Snyder. Well, that is understandable. You have been 
there by yourself for 1.5 hours. You are entitled to have one 
lost train of thought in an hour and 40 minutes. [Laughter.]
    But the question I asked, is there anything inherently 
different? I mean, if I went to a hospital in Little Rock where 
I had been admitted, and have been, they would have a 
handwritten medical record. And when they made their conversion 
to electronic medical records, somebody would say, ``Well, what 
do we do with all these doctors' scrawls?''
    Is there anything inherently different between the medical 
care system and a private system in terms of making this 
transition to an electronic medical record? I would assume 
there is not, but I don't know that.
    Dr. Winkenwerder. Well, I don't know how the small doctor 
office or the two- or three-doctor group would do it. I suspect 
they would hold onto----
    Dr. Snyder. Still hand-write.
    Dr. Winkenwerder. But if they were converting to an 
electronic record system, they would hold onto their old paper 
records.
    What we are trying to do--first of all, we have, as every 
difficult problem requires, a task force to work on this very 
issue within DOD. And it has to do with a number of things. One 
is how do you archive the old records, because we need them; 
there are certain legal requirements. There may be the need to 
refer back to them for clinical issues.
    And then, of course, there is the issue of what do people 
do if the system goes down. Do they capture the information on 
paper and then transcribe it back in? I mean, so there is a lot 
of issues with doing this kind of conversion. Can you scan it 
in?
    And so today, as we have stood up also, I am told that we 
have been able to go back and archive a couple of years' worth 
of encounter information, but we don't go back longer than 
that.
    And so we are, to my knowledge--and my staff can correct 
me--we have paper records that we are going to have to hold 
onto for some period of time. And there is no simple, quick way 
to get all of this information into this central database.
    Dr. Snyder. I don't hear anything you are saying, though, 
that makes it sound like it is inherently different from any 
other organization.
    Dr. Winkenwerder. I think that is right.
    Dr. Snyder. Mr. McHugh, do you have any final questions or 
comments?
    Mr. McHugh. No, Mr. Chairman. Thank you.
    Dr. Snyder. Dr. Winkenwerder, we appreciate you being here.
    I did a radio interview live back home to a Little Rock 
station at 7:15 Central, and it was 55 degrees at 7 a.m., so I 
sense a thaw is in the air, and we will let you go. [Laughter.]
    Just by a closing comment, you know, when we get the budget 
and we see things like, you know, 18 percent cut in applied 
research and 9 percent cut in basic research, and somehow we 
are going to create almost $2 billion in this budget 
somewhere--it is, you know, the middle of February, and somehow 
we are going to do this in the next 3 or 4 months--it just 
creates a lot of, well, uncertainty, and at some level a little 
bit of anger, because, you know, a lot of members and the 
public out there think, ``Well, wait a minute, this is going to 
be difficult.''
    And so we look forward to working with you. We appreciate 
your advocacy and your candor. But we obviously have some work 
to do on some aspects of this budget.
    And I believe you promised me you were going to get me some 
nice charts and graphs about where we are at with the numbers--
--
    Dr. Winkenwerder. We will.
    Dr. Snyder [continuing]. In this year's presentation.
    Dr. Winkenwerder. We will.
    Dr. Snyder. Do you have any final closing comments?
    Dr. Winkenwerder. Just thank you for the opportunity to be 
here today and to have a very constructive dialogue, I think, 
on all of these issues. We want to work together with you.
    I will say one final thing. With respect to these big 
challenges that we face, the only way--the only way--that we 
will solve them is if we in the department work together with 
you in the Congress, both sides of the aisle, and with our 
constituency and advocacy groups and all involved, and chart a 
path forward. And it is going to take some real leadership to 
do that, but I am confident it can be done.
    Dr. Snyder. I think Mr. McHugh and I are united in our 
concern about this number, so you have already got the 
bipartisanship going on there. Thank you.
    Dr. Winkenwerder. Thank you.
    Dr. Snyder. The hearing is adjourned.
    Dr. Winkenwerder. Thank you very much.
    [Whereupon, at 3:44 p.m., the subcommittee was adjourned.]


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                            A P P E N D I X

                           February 13, 2007

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                           February 13, 2007

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             QUESTIONS AND ANSWERS SUBMITTED FOR THE RECORD

                           February 13, 2007

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                   QUESTIONS SUBMITTED BY DR. SNYDER

    Dr. Snyder. Are you planning to provide us additional information 
on the status of your budget so that we might analyze that?
    Dr. Winkenwerder. The Department is waiting for recommendations 
from the Task Force on Military Health Care before issuing any specific 
proposals this year. As directed by Congress, the Department has not 
increased enrollment fees for TRICARE Prime, changed the deductibles 
for TRICARE Standard, or implemented an enrollment fee for Standard. 
There have also been no changes in the co-payments for pharmaceuticals. 
As a result, the cost-share paid by beneficiaries has remained flat 
while overall health care costs have gone up significantly. The result 
is that the Department of Defense's (DOD's) health care budget 
continues to be a larger portion of the DOD overall budget than it 
should.
    Dr. Snyder. Why has the DOD recommended, and approved a plan to 
obtain state-of-the-art second opinion pathology consultations by an 
ill-defined, fragmented system of commercial laboratories with 
uncertain outcomes, when the world-renowned AFIP has been doing this in 
an exemplary fashion? The plan is to outsource these secondary consults 
to the very same organizations that are currently sending these 
specimen to the AFIP. If these consults are not available, how does the 
quality of care of our Active Duty men and women, as well as our 
veterans, be affected?
    Dr. Winkenwerder. The Secretary of Defense's recommendation to 
outsource second opinion pathology consultations was based on the 
recommendation from the Medical Joint Cross-Service Group (MJCSG), one 
of seven cross-Service groups established by the Base Realignment and 
Closure (BRAC) process. The MJCSG was chartered to review DOD health 
care functions and to provide BRAC recommendations based on that 
review.
    The MJCSG developed key strategies to guide deliberations based on 
the key objectives above. These strategies came from an analysis of the 
BRAC final selection criteria. The MJCSG focused its efforts on:

      Supporting the war fighter and their families, in-
garrison and deployed;
      Maximizing military value while reducing infrastructure 
footprint and maintaining an adequate surge capability;
      Maintaining or improving access to care for all 
beneficiaries, including retirees, using combinations of the Direct 
Care and TRICARE systems;
      Enhancing jointness, taking full advantage of the 
commonality in the Services' health care delivery, health care 
education and training, and medical/dental research, development, and 
acquisition functions;
      Identifying and maximizing synergies gained from 
collocation or consolidation opportunities; and
      Examining outsourcing opportunities that allow DOD to 
better leverage the large United States health care system investments.

    Based on leveraging university and hospital services and commercial 
laboratories, the Department will rely on the civilian market for 
second opinion pathology consults and initial diagnosis when the local 
pathology laboratory's capabilities are exceeded.
    Dr. Snyder. Why have you not assessed the current outsourcing plan, 
as far as quality, cost and feasibility from the global deployment of 
the armed services are concerned? Why have you not calculated the 
projected costs over period of time?
    Dr. Winkenwerder. The Medical Joint Cross Service Group (MJCSG) has 
assessed the outsourcing of secondary consultations for the Department. 
According to the MJCSG report, ``Over half of Armed Forces Institute of 
Pathology's (AFIP's) capacity is being dedicated to commercial 
activities with private industry. Since these are not Department of 
Defense (DOD)/Defense Health Plan core business requirements, they are 
considered excess and should be discontinued. Additionally, AFIP's low 
military value is reflective of its small portion of military-related 
workload.'' Based on this assessment, the recommendation was to stop 
performing secondary consultations within DOD for both civilian and 
military cases and to leverage the large United States health care 
system investments. As a result of this recommendation, in the future, 
the Department will rely on the civilian market for second opinion 
pathology consults and initial diagnosis when the local pathology 
laboratory's capabilities are exceeded.
    Dr. Snyder. After September 11th, the AFIP has shown that it can 
respond 24/7 worldwide in quality, scope and flexibility to medical 
threats; e.g., SARS, anthrax, avian flu. The private analysis (Bearing 
Point study) commissioned by the Army SG office this year recommended 
maintaining a somewhat leaner but vibrant AFIP organization and moving 
it to USUHS in Bethesda. That analysis also stated: ``For DOD, 
disestablishment may result in the loss of immediate response 
capability to medical threats that could impact combat effectiveness or 
operational forces. For the nation, it eliminates robustness in 
capacity to respond to potential bioterrorism threats such as the 
recent anthrax and SARS situations.'' Who will respond to urgent 
military needs around the world if our core of pathology experts is 
disbanded? How can DOD replace this ``battle-tested'' unit with a 
proven track record by an intangible outsourcing replacement to 
nebulous commercial laboratories?
    Dr. Winkenwerder. The DOD participates in the international 
Laboratory Response Network and environmental surveillance. All of the 
Services have laboratory and epidemiological capabilities that can be 
mobilized or deployed during infectious disease outbreaks. These 
Service capabilities can be augmented by commercial and DOD 
organizations. Assisting organizations in the DOD/Military Services 
network include the Global Emerging Infections Surveillance and 
Response System (DOD-GEIS), United States Army Medical Research 
Institute for Infectious Diseases (USAMRIID), the Air Force Institute 
for Operational Health (AFIOH), and the Naval Health Research Center 
(NHRC) Respiratory Disease Laboratory. United States Public Health 
Service and State organizations may also provide support.
    The DOD-GEIS oversees the conduct of microbiological surveillance 
and focused surveillance activities at various DOD laboratories 
worldwide, and at the public health centers of the Air Force, Army, and 
Navy. The DOD-GEIS taps a network of collaborating experts and 
laboratories to provide emerging infectious disease consultation; 
identify vulnerabilities in surveillance, response and infrastructure; 
and, assists DOD partners to develop projects and implement programs 
that mitigate emerging infection threats.
    USAMRIID develops vaccines, drugs, diagnostics, and information to 
protect United States Servicemembers from biological warfare threats 
and endemic diseases. It is the only laboratory within DOD with the 
capability to study highly hazardous viruses requiring maximum 
containment at Bio-Safety Level 4.
    The AFIOH, Brooks City Base, Texas, provides active respiratory 
disease surveillance through a network of sentinel sites around the 
world as well as associated epidemiology support. The NHRC, San Diego, 
California, performs systematic, population-based respiratory disease 
surveillance among United States military trainee and shipboard 
populations.
    Dr. Snyder. The BRAC Commission's noting that the medical community 
argued that AFIP is an irreplaceable resource for disease research and 
education; why are these AFIP capabilities being eliminated especially 
since we are at war with our troops again stationed all over the world?
    Dr. Winkenwerder. The Department of Defense (DOD) will retain 
capabilities from AFIP that are critical to the military. These 
capabilities will be absorbed by DOD organizations and redistributed 
across DOD sites in the National Capital Area, Dover, Delaware, and San 
Antonio, Texas. The capabilities identified for absorption support the 
Secretary of Defense's BRAC goals to more efficiently and effectively 
support its forces, increase operational readiness, and facilitate new 
ways of doing business. When combined with full implementation of the 
BRAC law, the result is a set of capabilities that directly support the 
DOD mission.
    Dr. Snyder. In your letter dated March 27, 2006, to Representative 
Van Hollen, you stated ``it is recognized that some of the functions of 
the institute are critical to military and civilian medicine and must 
be retained.'' You further stated that the independent contractor, 
Bearing Point, will recommend and identify these critical components of 
the Institute and based on its recommendation an appropriate course of 
action will be taken. Why are you not accepting Bearing Point's 
recommendation: ``Retain Diagnostic and Consultative Services . . . to 
perform multidisciplinary diagnostic pathology . . . and allow for 
robust use of the repository''?
    Dr. Winkenwerder. The disposition of the Armed Forces Institute of 
Pathology's second opinion pathology consultation service is specified 
in the Base Realignment and Closure Commission's final recommendation, 
and is, therefore, not eligible for retention within the Department of 
Defense. Therefore, the Department does not have the option to accept 
Bearing Point's recommendation.
    Dr. Snyder. The tissue repository obviously must be kept by the 
DOD; therefore, why do you assume that it will remain viable and robust 
with no expert group of pathologists and staff to input cases?
    Dr. Winkenwerder. The Department continues to develop a plan for 
the optimal use of the tissue repository and the staff requirements to 
support this use.
    Dr. Snyder. Why have you not fully analyzed the impact of closing 
the AFIP with its resulting effect on other federal agencies; e.g., 
Department of Veterans Administration and the U.S. Public health 
services?
    Dr. Winkenwerder. The VA and the United States Public Health 
Service are members of the AFIP Board of Governors and have been 
involved in all discussions concerning the impact of the Base 
Realignment and Closure plan on the Department and their agencies. Both 
agencies collaborated on the capabilities to be retained within the 
Department of Defense and will continue to be involved in planning for 
the outsourcing of second opinion consultations.
    Dr. Snyder. Why have you not communicated your final decision to 
the appropriate committees in the Congress? Why are the AFIP executive 
committee and Board of Governors going ahead and eliminating positions 
in October of this year?
    Dr. Winkenwerder. The plan and timeline for the disestablishment of 
AFIP, according to the Base Realignment and Closure (BRAC) law, is 
contained in a report to Congress that will be forwarded shortly. The 
execution of the BRAC implementation plan for AFIP is contained in 
Business Plan #169. In order to meet the savings contained 
in this plan, the manpower reductions at AFIP must occur in October of 
2007. Therefore, the process to implement this reduction in force must 
begin now.
    Dr. Snyder. Autism--The FY07 John Warner National Defense 
Authorization Act required the Secretary to develop a plan to provide 
services to military dependent children with autism. The plan was 
required to address the education and training requirements for 
providers, the standards for identifying and training individuals with 
various level of expertise, and the procedures to ensure that these 
services are in addition to those publicly provided. The report is not 
due until April 2007, but a recent CDC report indicates the incidence 
of autism among 8 years olds is greater than previously assumed. 
Thousands of these children are in the military health care system and 
their parents are in need of support. What is the status of the plan, 
will we receive it on time, and are there any early indications that 
the Department will need legislative authority to implement any 
changes?
    Dr. Winkenwerder. The final report, in preparation at this time, 
will propose an interim solution for improving the number and 
availability of TRICARE certified providers of Applied Behavior 
Analysis (ABA). The Department expects to submit the report to Congress 
in a timely manner (Summer 2007). At this time, the Department does not 
expect that legislative authority to implement the plan is required.
    Dr. Snyder. Health Care Costs--Health care costs in the direct care 
system are assumed to be lower than obtaining similar services from 
civilian community. While both systems have similar services, they have 
different missions. Comparisons between the two currently are apples 
and oranges, has this comparison ever been studied? If so, why not? 
Shouldn't we understand the true costs before losing military capacity 
to the civilian sector?
    Dr. Winkenwerder. You are correct when you say that the different 
systems have different missions and that, because of those differences, 
direct comparisons are difficult. When detailed studies have been made 
on similar services, Direct Care, for the most part, has been shown to 
be more expensive than obtaining those same services from the civilian 
community (the notable exception is pharmacy where the Direct Care 
system can obtain pharmaceuticals at Federal ceiling prices). However, 
part of the additional expense of the Direct Care system is the result 
of its ``other'' mission, i.e., its primary mission of supporting the 
war fighters, especially in this time of ongoing conflicts. We are now 
beginning an effort to quantify those mission essential activities so 
they can be accounted for in future analyses of the true cost of 
providing Direct Care services. It is still clear, however, that, for 
the infrastructure and military personnel we need for our primary 
mission, using those assets to provide health care and maintaining 
those providers' medical skills is better than obtaining all of the 
beneficiary care in the civilian sector.
    Dr. Snyder. Medical Recruiting and Retention--The nation is facing 
a national nursing and physician shortages, and the military health 
care system is not immune from this environment. In addition, other 
health care providers, such as psychologists and pharmacists are also 
in high demand. What is Health Affairs doing to proactively address 
this issue?
    Dr. Winkenwerder. Health Affairs is working closely with the 
Services to utilize the significantly increased authorities in the 
National Defense Authorization Act for Fiscal Year (FY) 2007--for 
Medical/Dental accession bonuses, Health Professions Scholarship 
Program (HPSP) stipend, Financial Assistance Program (FAP) annual 
grant, and Health Professions Loan Repayment Program (HPLRP) maximum 
annual amount. The implementation of these authorities and the 
budgeting for them is currently being staffed with the Services. Some 
of the actions already undertaken have been to raise the Dental Officer 
Accession Bonus from $30K to $60K, the Four Year Nurse Accession bonus 
was increased to $25K. Health Affairs has recommended that the Services 
implement incremental increases in the stipend for the HPSP and FAP for 
the FY 2007-2008 school year. The Services and Health Affairs are 
currently staffing a plan to implement and budget for the up to $400K 
accession bonus for medical/dental critically short wartime 
specialties.
    The Services can also request Critical Skills Retention Bonuses, as 
the Air Force has, to improve retention of psychologists, as the Army 
has for psychologists, pharmacists, nurses, and other allied health 
professions in specific year groups.
    Health Affairs and the Services are also working closely with the 
Quadrennial Review of Military Compensation to provide new ideas to 
restructure incentive and special pay to meet the demands of the 
future.
    Dr. Snyder. Military to Civilian Conversions--The Navy's share of 
Military-Civilian (Mil-Civ) conversions was recently increased. Given 
that the Marine Corps end strength is increasing and Navy individual 
augmentation continues to increase, is the Department monitoring the 
impact of military to civilian conversions on the Navy medical system? 
Another concern is that some of the positions identified for military 
to civilian conversions include doctors, nurses and mental health 
providers, given the deployment demands on these communities, has there 
been any thought of exempting these types of medical professionals from 
the military to civilian conversions?
    Dr. Winkenwerder. The Medical Readiness Review (MRR) evaluated 
military medical billets that had been identified by the Military 
Departments as excess to readiness requirements to determine if they 
could feasibly be converted to civilian or contract personnel at no 
additional net cost to the Department of Defense. Only billets that met 
these criteria were selected for conversion, and the Military 
Departments agreed to these conversions. The Assistant Secretary of 
Defense for Health Affairs has placed no restrictions or exemptions on 
the types of positions converted. Rather, the Service Surgeons General 
and their staffs have maximum discretion in determining what 
specialties (e.g., physicians, nurses, technicians, etc.) to convert 
from military to civilian based upon the current and projected needs of 
each Service. These conversions are not projected to have a detrimental 
impact on health care delivery capability or quality at Military 
Treatment Facilities and have no impact on readiness capabilities.
    In an action separate from the military-to-civilian conversions 
resulting from the MRR process, 901 Navy military billets were 
identified for elimination. This action was taken based on programmed 
adjustments to active duty Navy and Marine Corps end strength. The 
Department analyzed the health care usage patterns of active duty Navy 
and Marine Corps personnel and their families and determined the 
appropriate reductions for Private Sector Care and In-House Care 
resources to reflect the end strength adjustments. The In-House Care 
resources were further allocated into Defense Health Program Operation 
and Maintenance reductions and Navy Military Personnel reductions, to 
reflect the reduced requirement for military labor. The net adjustment 
to Navy and Marine Corps end strength over the period addressed by the 
Program Decision Memorandum is a decrease of 4.0%; the 901 Navy Medical 
end strength reduction is a decrease of 3.8% over the same time period.
    The Department is committed to maintaining the military medical 
force structure necessary to support readiness requirements, as well as 
to maintaining a superb health care benefit for all of our eligible 
beneficiaries. We look forward to working closely with the Committee 
and appreciate your continued support of the Military Health System.
    Dr. Snyder. Mental Health--There have been a number of media 
reports regarding servicemembers that have returned from OIF/OEF and 
have exhibited symptoms of Post Traumatic Stress Disorder (PTSD). Some 
of these service-members have indicated a reluctance to seek mental 
health services because of the stigma associated with mental health. 
What is Health Affairs doing to help reduce mental health stigma? A 
military mental health professional indicated we do not have an 
adequate number of mental health providers or the requisite training 
needed to take care of the long-term psychological challenges that we 
may see as a result of OIF and OEF. What is Health Affairs doing to 
prepare for the future challenges that we may face in this arena?
    Dr. Winkenwerder. To reduce stigma, mental health education is 
fully integrated and mandatory at multiple levels of military training, 
deployment, and post-deployment. For example, suicide prevention 
activities in all Service branches train servicemembers at all levels 
to recognize others in distress at a low threshold. Specialized 
training programs exist for supervisors and leaders in suicide 
prevention. In addition, most branches utilize Web-based and compact 
disc-based Leaders' Guides for Personnel in Distress to assist 
supervisors and commanders to appropriately manage members with 37 of 
the most common mental health stressors encountered in our population. 
Pre- and post-deployment briefings for members and their families 
review anticipated stressors and ways to manage them, including 
referral resources. Substantial counseling resources are available to 
servicemembers and their families with confidentiality and no stigma. 
These include confidential screening using the free and confidential 
online service, utilization of chaplains with full confidentiality, 
MilitaryOneSource that includes online, e-mail, phone, and face-to-face 
counseling with Master's level counselors for prevention, education, 
and referral services; family support counselors; and family advocacy 
services. Members requiring more intensive assistance are referred to 
mental health providers who seek to respect confidentiality, consistent 
with mission need.
    Dr. Snyder. Traumatic Brain Injury--Much focus has been placed on 
the treatment of those with the visible injuries. Yet, not all 
Traumatic Brain Injuries are visible, but early intervention and 
treatment are critical to recovery. How are we assessing servicemembers 
who do not manifest overt signs of injury? Are we capturing TBI 
injuries adequately? Is there a tracking mechanism to ensure these 
servicemembers do not slip through the cracks?
    Dr. Winkenwerder. Servicemembers in-theater who are exposed to a 
possible TBI-producing incident, whether by fall, explosion, motor 
vehicle accident, or other event known to create a risk for TBI, are 
assessed according to a clinical practice guideline that was 
implemented in-theater in August 2006. This guideline requires using a 
tool called the Military Acute Concussion Evaluation (MACE), which will 
provide a reasonable assessment of whether a TBI exists as a result of 
that event, regardless of other injury. It is clear that in the 
confusion and chaos of a major Improvised Explosive Device explosion 
with loss of life or serious injury, TBI in those visibly injured, and 
in those otherwise not apparently injured, may be missed. We are 
providing training to raise medical and leadership awareness of TBI as 
an injury that may impair the war fighting abilities of those affected, 
and so imperil them and their fellow servicemembers if not identified 
and appropriately treated. All servicemembers with injuries that 
require evacuation to Landstuhl Regional Medical Center are assessed 
using the MACE if TBI was not previously documented. Starting June 1 
2007, screening for TBI will be part of the Post-deployment Health 
Assessment, the Post-deployment Health Reassessment, and the Periodic 
Health Assessment.
    Dr. Snyder. DOD-VA Seamless Transition--For years both Departments 
have been attempting to develop a seamless transition for 
servicemembers, however, it still seems as though there are a number of 
obstacles for servicemembers. Can you provide us with a list of 
programs that have been implemented, and can you identify what the 
status is of each of these programs?
    Dr. Winkenwerder. The Departments of Defense (DOD) and Veterans 
Affairs (VA) are collaborating to coordinate transition of health care 
for servicemembers and veterans, including those severely wounded 
during Operation Iraqi Freedom and Operation Enduring Freedom. The 
objectives of coordinated transition include ensuring continuity of 
care from DOD to VA health care providers; providing clear and 
comprehensive benefit information to servicemembers and their families; 
and, transferring medical records and results of separation physicals 
from the DOD to the VA.
    Severely injured servicemembers often require prolonged treatment 
and rehabilitative care. The DOD met this challenge by establishing 
specialty centers of excellence and partnerships with the VA. Key 
components of DOD and VA healthcare for severely injured servicemembers 
include three DOD amputee care centers, the Brooke Army Medical Center 
Burn Center, the Defense and Veterans Brain Injury Center, and four VA 
Polytrauma Rehabilitation Centers (Tampa, Florida, Minneapolis, 
Minnesota, Richmond, Virginia, and Palo Alto, California).
    The four VA polytrauma centers are designed to meet the needs of 
active duty Servicemembers and veterans who experienced severe injuries 
resulting in traumatic brain injuries, spinal cord injuries, 
amputations, or visual impairment. From March 2003 to December 2006, 
342 active-duty servicemembers were treated in the four polytrauma 
centers. In addition to the four polytrauma centers, 21 new VA 
Polytrauma Network Sites opened in Fiscal Year 2006 to provide 
continuing care to injured veterans. In addition, the VA provides care 
to injured veterans at 23 spinal cord injury centers and 10 blind 
rehabilitation centers.
    The Military Severely Injured Center, MilitaryOneSource, and four 
Service-specific programs provide linkages to VA to ensure continuity 
of care as the servicemember transitions to veteran status. The 
Military Severely Injured Center, established in February 2005, 
provides 24/7 support to servicemembers and their families, ensuring 
they are aware of all available options, and interacting with the 
involved agencies to ensure uninterrupted, highest-quality care. These 
programs reach out to servicemembers, evaluate their needs, and 
coordinate referrals to programs to provide the appropriate services. 
Four Service-specific programs provide assistance: the Army Wounded 
Warrior Program, Marine for Life, Air Force Palace HART, and Navy Safe 
Harbor. Each provides counseling, employment assistance, family 
support, and other services needed to transition to home and the 
community.
    The critical elements for the transition of medical care from DOD 
to VA include:

      A thorough understanding of medical care capabilities 
within both agencies by the involved medical providers,
      Clear communications of the transition plan between 
providers in each agency and with the patient and patient's family,
      Transfer of medical records at the time of transfer of 
the patient, and
      Continuation of communication after the transfer of the 
patient between the medical providers in each agency and with the 
patient and patient's family.

    In August 2003, a joint DOD/VA program was established at Walter 
Reed Army Medical Center (WRAMC) to provide case management for combat 
veterans. When severely injured servicemembers need long-term medical 
care, VA social work personnel and VA benefits counselors work with 
them to coordinate VA services. This joint program has expanded to nine 
other facilities: the National Naval Medical Center, Naval Hospital 
Camp Pendleton, Naval Medical Center San Diego, and six Army hospitals 
(Brooke, Eisenhower, Darnall, Madigan, Evans, and Womack). Twelve VA 
social workers provide the linkage from these ten hospitals to follow-
up care at a VA Polytrauma Center, if continued inpatient care is 
needed. If outpatient care is needed, the social workers provide the 
linkage to VA facilities near the servicemembers' homes.
    The VA social workers and counselors assigned to the military 
hospitals are usually the first VA representatives to meet with 
servicemembers and their families. They provide information about the 
full range of VA benefits and services, which include health care and 
readjustment programs, disability compensation and related benefits, 
the traumatic injury benefit provided under the Servicemembers Group 
Life Insurance Program, as well as educational and housing benefits. As 
of February 28, 2007, there had been 7,082 VA referrals at the ten 
military hospitals.
    Weekly video teleconferences are scheduled between WRAMC and the 
four VA polytrauma centers. These provide ongoing communication between 
DOD and VA physicians and nurses about patients who will be 
transferred. There is also communication between case managers at the 
Military Treatment Facility and the VA polytrauma centers that takes 
place before transfer. In addition, Army liaison personnel work at the 
four VA polytrauma centers to facilitate communication between the 
patients, families, health care providers, and to resolve issues that 
might arise related to military pay, travel, family housing, and other 
problems.
    Servicemembers who apply for disability compensation benefits under 
the Benefits Delivery at Discharge (BDD) program undergo a medical 
examination while still on active duty. The Program is a jointly 
sponsored VA and DOD initiative to provide transition assistance to 
separating servicemembers who have disabilities related to their 
military service. The program helps servicemembers file for VA service-
connected disability claims prior to separation from service, so that 
payment of benefits can begin as soon as possible after discharge. 
Under the BDD Program, servicemembers can complete an application for 
VA disability compensation benefits up to 180 days prior to separation. 
The single VA/DOD medical examination meets the military's needs for a 
separation physical and also fulfills VA's examination requirements for 
processing the disability claim.
    Dr. Snyder. Unified Medical Command--The proposed unified medical 
command issued by Secretary England is a departure from what the 
services were seeking as a genuine Unified Medical Command, which 
sought to increase efficiencies and gain savings. If the intent is to 
seek efficiencies and generate savings, why was the decision made to 
pursue a hybrid proposal as opposed to the UMC that was proposed by the 
Services? Where all of the Surgeon Generals involved in the decision 
making process? What were their recommendations on the UMC and how do 
they differ from what Secretary England approved?
    Dr. Winkenwerder. Program Budget Decision (PBD) 753 directed the 
Under Secretary of Defense for Personnel and Readiness (USD(P&R)) to 
work with the Chairman of the Joint Chiefs of Staff to develop an 
implementation plan for a Joint Medical Command by the Fiscal Year (FY) 
2008-2013 Program/Budget Review. A work group chartered under the 
USD(P&R) and the Chairman, Joint Chiefs of Staff prepared 
recommendations and possible courses of action for a UMC. Each of the 
Service Surgeons General was represented on this work group. During the 
same time, the Defense Business Board studied the issue and recommended 
one route to unification to the Secretary of Defense. Despite 
considerable effort, consensus was not achieved on a specific solution. 
After due consideration, the Deputy Secretary of Defense approved a 
framework for Achieving More Jointness and Unity of Command on November 
27, 2006.
    The approved framework consists of incremental and achievable steps 
that will yield efficiencies throughout the Military Health System 
(MHS). Economies of scale are achieved by combining common functions. 
The structural and functional changes create a foundation for 
implementing MHS Quadrennial Defense Review (QDR) transformation while 
preserving a Service unique culture for each medical component. Each 
aspect of the framework supports principles of unity of command and 
effort while creating a joint environment for the development of future 
MHS leaders. The concept includes accelerated consolidation of medical 
headquarters under Base Realignment and Closure law, maintenance of 
USD(P&R) oversight of the Defense Health Program (DHP), and positions 
the MHS for further unification, if warranted.
    Structural changes are included in the Deputy Secretary of Defense 
approved framework. These include:

      Establishment of a joint command for the National Capital 
Area, and a similar command for San Antonio;
      Establishment of joint commands for other multi-service 
markets;
      Establishment of a joint command for the Joint Medical 
Education and Training Center in San Antonio;
      Combination of all medical research and development 
assets under the Army Medical Research and Material Command;
      Creation of a joint Military Health Directorate to 
consolidate shared MHS services such as human capital, finance, IM/IT, 
logistics, and force health sustainment;
      Re-focusing of the TRICARE Management Activity on the 
benefit and health plan management and beneficiary support mission; 
and,
      Health Affairs' role in MHS policy development, strategy 
management, DHP budget development and oversight, and legislative 
strategy will remain unchanged.

    The Assistant Secretary of Defense for Health Affairs is working 
with the Services and Joint Staff to develop a detailed implementation 
plan for each of the elements of the concept for more unity. The 
Service Surgeons General are directly involved in this work. An 
implementation team will be formed during FY 2007 and will be tasked 
with delivering the implementation plan within one year. All of the 
design elements contained in the Deputy Secretary of Defense's 
memorandum of November 27, 2006 are to be in place by the end of FY 
2009.
    The road map for achieving increased unity will yield improvements 
in quality, efficiency, patient satisfaction, and war fighter support 
consistent with the MHS Strategic Plan; each of the elements of the 
plan should contribute to the achievement of stability and uniformity 
of healthcare processes and resource acquisition:

      By establishing more unity of command in each of the 
major markets, the market leaders will be able to distribute resources 
across hospitals and clinics within a market to meet the needs of the 
entire population of eligible beneficiaries. In addition, the increased 
span of control will enable improved continuity of care and 
coordination of safety and quality programs.
      Through the establishment of a joint command for the 
Joint Medical Education and Training Center, the MHS will improve the 
quality and consistency of training for all enlisted, contributing to a 
culture of jointness and interoperability.
      The combination of all medical research and development 
assets under the Army Medical Research and Material Command will foster 
better coordination of research activities, eliminate redundant 
efforts, and focus resources on developing novel solutions for both the 
war fighter and the clinician.
      The creation of a joint Military Health Directorate to 
consolidate shared services has perhaps the most potential to improve 
quality of care, quality of service and efficiency:

        The potential to combine data management and analysis 
functions should lead to greater standardization, shared quality and 
performance measures, and much improved workload and cost data needed 
for optimal management decisions. This is also a critical element of 
the MHS QDR Roadmap for Medical Transformation.
        Coordinated implementation of the DOD Continuous 
Process Improvement program incorporating lean and six sigma 
methodologies will result in reduced variation, improved quality, and 
elimination of waste.
        Implementation of other shared services (human capital 
management, logistics, financial services, facilities planning, and 
design), will further enhance economies of scale and optimal 
distribution of resources.

      By refocusing the TRICARE Management Activity on the 
benefit, health plan management, and beneficiary support mission we 
will build upon gains already achieved in the area of beneficiary 
support, effective communication of the TRICARE benefit and performance 
based contracting for high quality health care services.
      The co-location of the headquarters functions of Health 
Affairs, the TRICARE Management Activity, the Army Medical Command, the 
Navy Bureau of Medicine, and the Air Force Medical Service will enhance 
efforts to achieve unity of purpose for MHS policy, strategy, and 
financial programming and yield greater consistency across the Services 
in program execution.

    Taken as a whole, this set of incremental changes will result in 
more unity of effort by eliminating duplicative layers of command and 
control, leveraging efficiencies through combining common support 
functions, standardizing policy, training and doctrine for all our 
forces, rationalizing span of control at both tactical and strategic 
levels, and improving resource management, transparency, and 
accountability. This set of structural changes will be the foundation 
for the continuing MHS transformation that is described in the QDR 
Roadmap and the MHS Strategic Plan.
                                 ______
                                 
                    QUESTION SUBMITTED BY MR. MCHUGH
    Mr. McHugh. What kind of look-see is your office, your department, 
doing to make sure that we are going to not unnecessarily and very 
harmfully erode the ability and the availability of mental health 
positions, particularly in deployed areas, particularly given the surge 
that we have talked a little bit about here today?
    Dr. Winkenwerder. We examine mental health staffing throughout the 
Department in order to maintain the current levels of filling uniformed 
positions, set by the Department of Defense (DOD). In January this 
year, our staffing numbers indicated that, across DOD, 92% of mental 
health personnel positions were filled. There were some imbalances 
between professions due to personnel fluctuations, with mental health 
clinical provider staffing ranging by specialty from 75% to 85%. When 
trends suggest potential shortages of particular specialists in the 
future, the Services respond by offering incentives to improve 
accession and retention of needed personnel. Branch-utilized incentives 
include offering annual Critical Skills Retention Bonuses as well as 
educational loan paybacks. Physician bonuses for psychiatrists are 
adjusted for all services, as required. The DOD continues to monitor 
their ability to attract and retain health care personnel and adjust 
incentives accordingly. Factoring in the need for deployable mental 
health assets should drive military-to-civilian conversion limitations.
    Mr. McHugh. Can you give us an idea of how much of the $94 million, 
if any, did we achieve in efficiencies in the 2006 budget? What did you 
do to reach them? And what kind of efficiencies are we talking about 
when you are looking at $248 million for next year's budget?
    Dr. Winkenwerder. The Fiscal Year (FY) 2006 Defense Health Program 
Budget was reduced by $94 million in anticipation of efficiencies 
accomplished by the Services that would decrease costs. During the 
execution of the FY 2006 budget, efficiencies were achieved through a 
combination of implementing the TRICARE Uniform Formulary, which 
decreased drug expenditures in the direct care system for all three 
Services, and the following Service-specific initiatives:

    - The Army Medical Department focused on increasing inpatient and 
outpatient market share, and rewarded successful facilities with 
additional resources earned through the Prospective Payment System.
    - Navy Medicine focused on the consolidation of dental activities 
into the organization structure of their medical treatment facilities, 
enabling elimination of duplicative overhead activities and the 
achievement of staffing efficiencies in dental and support areas.
    - The Air Force Medical Service focused on elimination of 
inefficient inpatient care facilities, with reinvestment of personnel 
at locations where significant workload recapture potential exists.

    For FY 2007 and FY 2008, the focus is for the Services to continue 
to build on the FY 2006 efficiencies that were initiated and to 
continue to realize savings in pharmacy expenditures produced by the 
TRICARE Uniform Formulary. In addition, the Director of TRICARE 
Management Activity and the Service Surgeons General are taking action 
to identify opportunities for efficiencies by identifying the most 
critical mission activities and then applying Lean Six Sigma 
methodology to achieve process improvements.
    Note the FY 2008 incremental increase in the Efficiency Wedge was 
reduced from $248 million to $227 million to account for an overlap in 
cost reductions targeted for a different initiative.
    Mr. McHugh. If you could get the figures as to what we did save in 
2006 and what we did to save them, and also what the target is, where 
the target areas lie with respect to the $248 million for next year.
    Dr. Winkenwerder. The Fiscal Year (FY) 2006 Defense Health Program 
Budget was reduced by $94 million in anticipation of efficiencies 
accomplished by the Services that would decrease costs. During the 
execution of the FY 2006 budget, efficiencies were achieved through a 
combination implementing the TRICARE Uniform Formulary, which decreased 
drug expenditures in the direct care system for all three Services, and 
the following Service specific initiatives:

    - The Army Medical Department focused on increasing inpatient and 
outpatient market share, and rewarded successful facilities with 
additional resources earned through the Prospective Payment System.
    - Navy Medicine focused on the consolidation of dental activities 
into the organization structure of their medical treatment facilities, 
enabling elimination of duplicative overhead activities and the 
achievement of staffing efficiencies in dental and support areas.
    - The Air Force Medical Service focused on elimination of 
inefficient inpatient care facilities, with reinvestment of personnel 
at locations where significant workload recapture potential exists.

    For FY 2007 and FY 2008, the focus is for the Services to continue 
to build on the FY 2006 efficiencies that were initiated and to 
continue to realize savings in pharmacy expenditures produced by the 
TRICARE Uniform Formulary. In addition, the Director, TRICARE 
Management Activity and the Service Surgeons General are taking action 
to identify opportunities for efficiencies by identifying the most 
critical mission activities and then applying Lean Six Sigma 
methodology to achieve process improvements.
    Note the FY 2008 incremental increase in the Efficiency Wedge was 
reduced from $248 million to $227 million to account for an overlap in 
cost reductions targeted for a different initiative.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MRS. DRAKE
    Mrs. Drake. What are military members told in recent years when 
they sign up to join the military? Are they told, ``You are going to 
have affordable health care''? Are they told, ``You have health care''? 
What are they told, and what is their expectation?
    Dr. Winkenwerder. In accordance with the TRICARE Operations Manual, 
Chapter 12, Section 2, Paragraph 1.4, each managed care contractor is 
available to brief recruiters three times annually. Additionally, each 
TRICARE regional office provides virtual briefings for recruiters and 
others interested in learning about the TRICARE benefit.
    New Servicemembers and their families are invited to orientations 
and TRICARE briefings where information about TRICARE is provided. They 
are told they will be covered under TRICARE but they will need to make 
choices between Prime, Standard, and Extra. We provide pamphlets that 
explain the military health benefit and we also direct servicemembers 
to the TRICARE Web site which provides additional detailed information 
about the benefit. Reservists are also provided informational brochures 
and briefings to explain the new benefits under TRICARE Reserve Select.

                                  
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