[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]


 
                         [H.A.S.C. No. 111-48] 

                      THE MILITARY HEALTH SYSTEM: 

                   HEALTH AFFAIRS/TRICARE MANAGEMENT 

                         ACTIVITY ORGANIZATION 

                               __________

                                HEARING

                               BEFORE THE

                    MILITARY PERSONNEL SUBCOMMITTEE

                                 OF THE

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD

                             APRIL 29, 2009

                                     
                  [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                               ----------
                         U.S. GOVERNMENT PRINTING OFFICE 

51-915 PDF                       WASHINGTON : 2010 

For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; 
DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, 
Washington, DC 20402-0001 




















                    MILITARY PERSONNEL SUBCOMMITTEE

                 SUSAN A. DAVIS, California, Chairwoman
VIC SNYDER, Arkansas                 JOE WILSON, South Carolina
LORETTA SANCHEZ, California          WALTER B. JONES, North Carolina
MADELEINE Z. BORDALLO, Guam          JOHN KLINE, Minnesota
PATRICK J. MURPHY, Pennsylvania      THOMAS J. ROONEY, Florida
HANK JOHNSON, Georgia                MARY FALLIN, Oklahoma
CAROL SHEA-PORTER, New Hampshire     JOHN C. FLEMING, Louisiana
DAVID LOEBSACK, Iowa
NIKI TSONGAS, Massachusetts
                David Kildee, Professional Staff Member
               Jeanette James, Professional Staff Member
                     Rosellen Kim, Staff Assistant















                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2009

                                                                   Page

Hearing:

Wednesday, April 29, 2009, The Military Health System: Health 
  Affairs/TRICARE Management Activity Organization...............     1

Appendix:

Wednesday, April 29, 2009........................................    31
                              ----------                              

                       WEDNESDAY, APRIL 29, 2009
THE MILITARY HEALTH SYSTEM: HEALTH AFFAIRS/TRICARE MANAGEMENT ACTIVITY 
                              ORGANIZATION
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

Davis, Hon. Susan A., a Representative from California, 
  Chairwoman, Military Personnel Subcommittee....................     1
Wilson, Hon. Joe, a Representative from South Carolina, Ranking 
  Member, Military Personnel Subcommittee........................     3

                               WITNESSES

Embrey, Ellen P., Acting Assistant Secretary of Defense, Health 
  Affairs........................................................     5
Granger, Maj. Gen. Elder, USA, Deputy Director, TRICARE 
  Management Activity (TMA)......................................    13
McGinn, Gail H., Acting Under Secretary of Defense, Personnel and 
  Readiness......................................................     4
Robinson, Vice Adm. Adam, USN, Surgeon General, U.S. Navy........     9
Roudebush, Lt. Gen. James G., USAF, Surgeon General, U.S. Air 
  Force..........................................................    11
Schoomaker, Lt. Gen. Eric, USA, Commanding General, U.S. Army 
  Medical Command, The Surgeon General, U.S. Army................     7

                                APPENDIX

Prepared Statements:

    Davis, Hon. Susan A..........................................    35
    Embrey, Ellen P..............................................    44
    Granger, Maj. Gen. Elder.....................................    79
    McGinn, Gail H...............................................    38
    Robinson, Vice Adm. Adam.....................................    65
    Roudebush, Lt. Gen. James G..................................    70
    Schoomaker, Lt. Gen. Eric....................................    56
    Wilson, Hon. Joe.............................................    37

Documents Submitted for the Record:

    TRICARE Behavioral Health Resources..........................    87
    TRICARE Mental Health Expenditures and Utilization Trends, FY 
      2002-08....................................................    97

Witness Responses to Questions Asked During the Hearing:

    Mrs. Davis...................................................   103
    Ms. Fallin and Mrs. Davis....................................   103

Questions Submitted by Members Post Hearing:

    Mrs. Davis...................................................   107
    Mr. Wilson...................................................   110
THE MILITARY HEALTH SYSTEM: HEALTH AFFAIRS/TRICARE MANAGEMENT ACTIVITY 
                              ORGANIZATION

                              ----------                              

                  House of Representatives,
                       Committee on Armed Services,
                           Military Personnel Subcommittee,
                         Washington, DC, Wednesday, April 29, 2009.
    The subcommittee met, pursuant to call, at 10:00 a.m., in 
room 2118, Rayburn House Office Building, Hon. Susan A. Davis 
(chairwoman of the subcommittee) presiding.

OPENING STATEMENT OF HON. SUSAN A. DAVIS, A REPRESENTATIVE FROM 
    CALIFORNIA, CHAIRWOMAN, MILITARY PERSONNEL SUBCOMMITTEE

    Mrs. Davis. Good morning. It is good to have you all here. 
The meeting will come to order.
    Today, the Military Personnel Subcommittee will hold a 
hearing on the organization of the Office of the Assistant 
Secretary of Defense for Health Affairs. It is important to 
note that the Office of the Assistant Secretary of Defense for 
Health Affairs has a unique organization within the Department 
of Defense. It is the only merger of an Assistant Secretary's 
Office and the defense activity or agency, in this case the 
TRICARE Management Activity. In every other instance we can 
find, a defense agency or activity is a stand-alone entity, 
usually with a three-star or Senior Executive Service (SES) 
director and a two-star SES deputy or vice director.
    The agency or activity falls under the Office of Secretary 
of Defense Office and the director reports to the OSD official 
such as an under secretary, an assistant secretary or deputy 
under secretary. But the two staffs in all those instances are 
separate and distinct. In Health Affairs (HA), however, the 
assistant secretary is also the director of the TRICARE 
Management Activity. Each of the Health Affairs deputy 
assistant secretaries are also dual-hatted as the TRICARE 
Management Activity division chiefs.
    And, finally, if we have confused everybody by now, 
finally, last year, the Principal Deputy Assistant Secretary of 
Defense for Health Affairs was also designated as the Principal 
Deputy Director of the TRICARE Management Activity.
    This new position actually has no corollary in other 
defense agencies or activities; and, frankly, its role has not 
yet been fully explained. So, as a result, the role of the two-
star deputy director of the TRICARE Management Activity to many 
people is not exactly clear, and we are here to have you 
explain that to us.
    In all of the other Office of the Secretary of Defense 
(OSD) offices that have a defense agency or activity underneath 
them, the under or assistant secretary staff develops policy 
and provides oversight, while the agency or activity staff is 
responsible for executing that policy. This structure is the 
result of hard lessons learned with built-in checks and 
balances.
    In Health Affairs, one set of people is responsible for 
both sets of functions; and, in fact, few refer colloquially to 
either Health Affairs or the TRICARE Management Activity (TMA), 
separately. They are simply known as the Health Affairs slash 
TRICARE Management Activity, or HA/TMA. So, with HA/TMA, we are 
clearly dealing with a different model from the rest of the 
Department; and we do not know if that is a good different, if 
it is a bad different or just different. It is therefore 
important for us to examine exactly how the HA/TMA is organized 
and operates today and then, most significantly, how that 
impacts the care we provide to our men and women in uniform. 
And isn't that really the bottom line here that we are seeking?
    Our hearing will seek to answer the following questions:
    What is the current organizational structure of Health 
Affairs/TRICARE Management Activity? What are the current roles 
and responsibilities of Health Affairs/TRICARE Management 
Activity? And is this unique structure that we have referred to 
appropriate to the roles and responsibilities of the office? 
What is the organizational relationship between HA/TMA and the 
services? Does that current organizational structure support 
the requirements of the services, most significantly? And are 
there any plans to reorganize HA/TMA; and, if so, what would 
that new organization look like? How does the Department plan 
to deal with the joint medical command headquarters Base 
Realignment and Closure (BRAC) recommendation?
    For our witness panel today, we have all the key players 
from the Military Health System (MHS).
    First is the individual to whom Health Affairs reports, the 
Acting Under Secretary of Defense for Personnel and Readiness, 
Ms. Gail McGinn. Ms. McGinn has been the Acting Under Secretary 
for just a few weeks now, so we understand the difficulty of 
being here today. But we appreciate it very much, and we look 
forward to the discussion with you.
    Next is the Acting Assistant Secretary of Defense for 
Health Affairs, Ms. Ellen Embrey; and this is actually Ms. 
Embrey's first day as the Acting Assistant Secretary. So 
congratulations to you. You may not be feeling that way 
afterwards. But we are very happy to have you with us as well. 
I understand that you will be testifying also this afternoon 
before our counterpart subcommittee in the Senate.
    We also have all of the service Surgeons General here 
today. And we certainly welcome you again, and we know that we 
have had an opportunity to meet with you in the past: 
Lieutenant General James Roudebush from the Air Force, Vice 
Admiral Adam Robinson from the Navy, Lieutenant General Eric 
Schoomaker from the Army, to get the service perspectives on 
the current HA/TMA organizational structure. And, finally, we 
are very delighted and fortunate to have the Deputy Director of 
the TRICARE Management Activity, Major General Granger here 
today as well.
    General, I understand that this is your last week--we have 
a few milestones here today--your last week as the Deputy 
Director and that you will be returning shortly, after several 
decades in uniform, to the private sector. And we certainly 
wish you well in your service moving forward; and we thank you 
very, very much for your contribution to our country.
    So that is my introduction and, I want to turn to my 
colleague, Mr. Wilson who wants to welcome you as well.
    [The prepared statement of Mrs. Davis can be found in the 
Appendix on page 35.]
    Mrs. Davis. Mr. Wilson.

   STATEMENT OF HON. JOE WILSON, A REPRESENTATIVE FROM SOUTH 
   CAROLINA, RANKING MEMBER, MILITARY PERSONNEL SUBCOMMITTEE

    Mr. Wilson. Thank you, Madam Chairman.
    Today, the subcommittee meets to hear testimony from the 
Department of Defense and the service medical leadership 
regarding the current organizational structure of the Military 
Health System, MHS. I want to welcome our witnesses, and I look 
forward to their testimony.
    A robust military medical system is essential to the health 
and well-being of our Armed Forces. General George Washington 
and the Continental Congress understood the necessity of good 
medical care during the fight for our independence. After 
suffering a sizeable number of casualties from disease, the 
Continental Congress established the Medical Department of the 
Army in July 1775. Washington then appointed the first director 
general and chief physician of the hospital of the Army. Since 
that time, our military medical system has provided care for 
the sick and injured during times of war and maintained the 
medical readiness of service members in peacetime. America 
expects nothing less.
    With that being said, I want to make sure that the Military 
Health System is structured and organized to continue to 
provide world-class health care today and in the future. I am 
interested in hearing from our witnesses today on how the 
Military Health System is organized to carry out its multiple 
health care missions of maintaining medical readiness 
capabilities, providing peacetime health care to eligible 
beneficiaries, providing battlefield medicine to our brave men 
and women in Iraq and Afghanistan in the Global War on 
Terrorism, and caring for those brave men and women through the 
long recovery process when they become injured or wounded.
    I am personally interested as the grateful father of four 
sons currently serving in the military today, including one of 
my sons, who is a Navy doctor, Admiral, so I am particularly 
proud of what you all are doing and what you are achieving for 
the young people who have the opportunity to serve in the 
military.
    Is there a better way to structure the system as we look to 
the future? Are there opportunities to build on initiatives 
such as the joint task force capital medicine that was 
established to implement the base realignment and closure 
requirements in the National Capital Region?
    I look forward to hearing from the uniformed leadership 
with us today, how they view the organization and structure of 
the MHS and if it helps or hinders their ability to carry out 
their responsibility to provide medical care to all of our 
beneficiaries.
    Before I close, I would like to recognize and congratulate 
Major General Elder Granger on his upcoming retirement from the 
Army. General Granger has served this Nation and our service 
members with distinction for over 32 years, and I was happy to 
point out to him he topped me by a year. I was in 31. So I am 
very, very grateful for your service.
    Also, I want to alert you that we do have a condominium at 
Hilton Head. There is one left, and so you would be welcome to 
come to South Carolina.
    I sincerely thank you for your service and wish you the 
best in your future endeavors. God bless you.
    Thank you, Madam Chairwoman.
    [The prepared statement of Mr. Wilson can be found in the 
Appendix on page 37.]
    Mrs. Davis. Thank you, Mr. Wilson.
    And now, Ms. McGinn, would you please begin. And then we 
will go right down the line.
    And we are--I think we have told you that you have five 
minutes. We hope you can stick to that, since we have a large 
panel, and we certainly have a number of questions. Thank you 
very much.

STATEMENT OF GAIL H. MCGINN, ACTING UNDER SECRETARY OF DEFENSE, 
                    PERSONNEL AND READINESS

    Ms. McGinn. Thank you, Madam Chairman, members of the 
committee and thank you for the opportunity to be with you 
today to discuss the Military Health System organization. I 
have submitted a written statement for the record.
    Health care, of course, plays a pivotal role in sustaining 
the All-Volunteer Force and its readiness. As we continue to 
respond to the realities of the post 9/11 world, the Department 
remains firmly focused on the health and well-being of our 
forces and their families, particularly the wounded, ill and 
injured, and to ensuring that all Department of Defense (DOD) 
beneficiaries receive the highest quality, most accessible and 
cost-effective health services available.
    As you noticed, I am here performing the duties of the 
Under Secretary of Defense for Personnel and Readiness. But the 
Under Secretary of Defense for Personnel and Readiness 
exercises authority, direction and control over the Assistant 
Secretary of Defense for Health Affairs. He or she develops 
policies, plans and programs for health and medical affairs to 
provide health services and support to members of the Armed 
Forces, their families and others entitled to or determined 
eligible for Department of Defense care. The under secretary 
also ensures that policies and programs are designed and 
managed to improve standards of performance, economy and 
efficiency and that service providers are responsive to the 
requirements of their organizational customers.
    Among other things, in exercising these responsibilities, 
the under secretary reviews the overall status of the Military 
Health System, chairs the Military Health System Executive 
Review, which is the Department's senior health care advisory 
body which represents the stakeholder perspective; and he or 
she also chairs the congressionally mandated Joint Medical 
Readiness Council.
    Over the last five years, Congress has enacted many new 
programs, has directed BRAC implementation and expanded our 
requirements to care for wounded warriors. At the same time, 
the Department has been asked to reduce health care costs, 
while increasing efficiencies.
    In response, the Department has taken significant steps to 
improve unity of effort. For example, the Deputy Secretary of 
Defense established a joint command for the national capital 
area. Joint Task Force Capital Medical, JTF CapMed, achieved 
full operating capability on 30 September, 2008, and is meeting 
BRAC milestones for the creation of the Walter Reed National 
Military Medical Center at Bethesda.
    For health care delivery in the San Antonio multi-service 
market, all governance decisions are accomplished in a joint 
collaborative manner to further enhance a culture of increased 
jointness and interoperability. Brooke Army Medical Center and 
the Air Force's Wilford Hall Medical Center have already 
completed an in-patient business plan for the new San Antonio 
Military Medical Center and are currently reviewing their 
integrated manpower needs and synchronizing construction with 
their transition schedule.
    The Department is also standing up the joint medical 
education and training campus in San Antonio, Texas, to improve 
the quality and consistency of training of all enlisted 
personnel.
    Under the Base Realignment and Closure Act, the Department 
is proceeding with plans to collocate the medical headquarters 
activities of Health Affairs, TRICARE Management Activity, the 
Army Medical Command, the Navy Bureau of Medicine and Air Force 
Medical Service. This collocation will increase unity of effort 
in policy, strategy and financial programming and yield greater 
consistency across the services in program execution, we 
believe.
    Madam Chairwoman, the ultimate goal for the Under Secretary 
of Personnel and Readiness is to ensure a predictable, 
reliable, robust, effective, superior quality and readily 
accessible health care benefit for the DOD population. The 
testimony you will hear from my colleagues, Ms. Ellen Embrey 
and the Deputy Director of TRICARE Management Activity, will 
provide greater detail about their roles and responsibilities 
in these areas. Together, we continue to do all we can to 
improve the lives and health of those in our care.
    We thank you for your generous support of military men and 
women and their families, and we look forward to your 
questions.
    Mrs. Davis. Thank you.
    [The prepared statement of Ms. McGinn can be found in the 
Appendix on page 38.]
    Mrs. Davis. Please, Ms. Embrey.

  STATEMENT OF ELLEN P. EMBREY, ACTING ASSISTANT SECRETARY OF 
                    DEFENSE, HEALTH AFFAIRS

    Ms. Embrey. Madam Chairwoman, members of the committee, 
thank you for the opportunity to respond to your request for 
information and to present the current Military Health System's 
organizational and governance structure.
    Title 10 of the U.S. Code defines the key leadership roles 
and responsibilities of the organizations that comprise the 
Military Health System. Most of the organizations are 
represented here today. Ms. McGinn, Major General Granger and I 
represent the organizations from within the Office of the 
Secretary of Defense.
    When I arrived in Health Affairs in January of 2002 at a 
lower level, I was one of the four deputy assistant secretaries 
in Health Affairs. At that time, there was a clear division of 
role and responsibility between the Office of Health Affairs 
and the supporting activity, TRICARE Management Activity.
    Those structures were established in the late 1990s as an 
outcome of defense reform initiatives to control the rising 
cost of health care services, to improve access to care for the 
beneficiary population and to increase the consistency and 
quality of health care across the Department. The initiatives 
capped the Office of the Secretary of Defense and service 
headquarters staffs and realigned the majority of the former 
Health Affairs staff into the newly formed TRICARE Management 
Activity.
    Today, Health Affairs staff remains capped at 42 military 
and civilian personnel. Its primary responsibility is to advise 
the Secretary of Defense on all health matters and to develop 
Department-wide policies and programs consistent with the 
Department's health care and medical readiness needs.
    TRICARE's primary responsibility is to execute defense-wide 
programs, services and contracts that improve access, quality 
and consistency of health care services and to enable the 
Services to perform. Today's TRICARE workforce numbers more 
than 1,350 personnel worldwide.
    The military Surgeons General lead and manage organizations 
and facilities that develop, enhance and execute the services' 
medical programs; and they guide joint operating programs in a 
lead or executive agent role.
    The Joint Staff and the geographic and functional combatant 
commanders also have Surgeons General who advise them on 
contingency operations health planning, patient movement and 
tracking and theater health delivery services in commands 
around the globe.
    Since September 11, 2001, the Department has had to adapt 
to several new environmental drivers and very much expanded 
requirements, including increased national security threats and 
force health protection needs and six years of continuous 
concurrent military operations in Iraq and Afghanistan with all 
of the medical force protection and other services that those 
operations entail.
    Some 95,000 military medical personnel have deployed to 
support U.S. warfighters, in addition to providing mandatory 
health deployment assessments and reassessments, increased 
psychological health programs and services, expanded research 
and treatment protocols to address traumatic injuries, as well 
as wounded warrior rehabilitation and recovery programs, a new 
theater trauma registry and management program, and expanding 
and improving the electronic health systems.
    Further, we have also engaged in the development, testing 
and implementation of common cognitive assessment tools for 
field and baseline assessments.
    We also established a new defense center of excellence for 
psychological health and traumatic brain injury, to address 
that and other areas of urgent concern. We have conducted 
multiple global stabilization and reconstruction operations in 
response to catastrophic natural disasters at home and abroad. 
We have plans to address a strategically imminent threat of a 
global pandemic. We have promulgated and participated in 
international health regulations to address the threats of 
bioterrorism. We have implemented new BRAC and Quadrennial 
Defense Review (QDR) recommendations during that time frame to 
consolidate and align common functions. And we help support the 
medical aspects and development of the new Africa Command with 
a global health mission.
    We have taken on other new and expanded areas of 
responsibility which are detailed in my testimony that has been 
submitted for the record.
    So we have had a lot of stuff we have been managing in 
chaos for many years now. In order to address that, an updated 
charter for the Assistant Secretary of Defense for Health 
Affairs was published in June of 2008. It recognized the need 
to organize to help manage an MHS which grew from $20 billion 
in 2002 to a $45 billion program in 2009.
    Madam Chairwoman, the world has changed dramatically since 
September 11th; and the MHS has had to evolve to meet its 
changing requirements. We do take a collaborative leadership 
approach in making those governance decisions. We work hard to 
develop win-win positions with our colleagues here at the 
table, and we engage on an ongoing basis on how to improve our 
focus for patient-centered care.
    We believe we have improved the efficiency and 
effectiveness of the Military Health System as an enterprise; 
and with your help and continuing support, we hope we will 
continue to do the same. Thank you very much.
    Mrs. Davis. Thank you.
    [The prepared statement of Ms. Embrey can be found in the 
Appendix on page 44.]
    Mrs. Davis. General Schoomaker.

STATEMENT OF LT. GEN. ERIC SCHOOMAKER, USA, COMMANDING GENERAL, 
   U.S. ARMY MEDICAL COMMAND, THE SURGEON GENERAL, U.S. ARMY

    General Schoomaker. Madam Chairwoman, Representative 
Wilson, distinguished members of the Military Personnel 
Subcommittee, thank you for the opportunity to discuss the 
organization of the Military Health System.
    First, I would like to take this opportunity to publicly 
thank the Honorable Dr. S. Ward Casscells for his years of 
principled, passionate service as the Assistant Secretary of 
Defense for Health Affairs. We bid farewell to Dr. Casscells 
last night. He is a friend; he is a mentor whom I greatly 
respect. His compassion and commitment to our service members 
and our families has been unparalleled. He is really one of 
my--one of our heroes at this table, and I don't say that 
lightly. His team in Health Affairs and the TRICARE Management 
Agency are hard-working and dedicated individuals, and I salute 
their service to the Nation.
    Although the title of this hearing addresses the 
organization of Health Affairs and TMA, HA/TMA, I am not really 
so interested in organizational structure. I am--as you cited, 
Madam Chairwoman, in your opening comments and addressed in one 
of your questions, I am far more concerned about the nature of 
the functional relationships between and among the stakeholders 
in the Military Health System, the MHS.
    To be more effective, form should always follow function. 
The function of the Military Health System must be first and 
foremost to support the warfighter on the battlefield. We must 
have trained and competent health care professionals delivering 
timely, effective and not just acceptable but truly world-
class, cutting-edge care on the battlefield.
    In order to recruit and retain these professionals, to 
acculturate them in the service of the Army, the Navy, the Air 
Force, the Marines and the Joint Medical Force and maintain 
their skills in peacetime and wartime, we maintain what we call 
a direct care system of military hospitals, health centers and 
clinics. The direct care system delivers a robust health care 
benefit to active duty soldiers, family members and retirees 
who live within a reasonable commuting distance to our military 
treatment facilities.
    For an Army at war, care of our families is critical. The 
warrior must know that his or her family is safe and is being 
cared for, and the warrior and their families must be confident 
that if that warrior is injured or ill in the course of their 
duties that they are going to survive, they are going to return 
home, and they will have the best chance at full recovery and 
an active or productive life, either in uniform or out.
    Each service maintains responsibility for operating and 
managing our portion of the direct care system. Our military 
clinics and hospitals, our graduate medical education programs 
and graduate programs in general, our medic training platforms 
are all the cornerstone of Army medicine's three-pronged 
mission to, first, promote, sustain and enhance soldier health; 
train, develop and equip a medical force that supports full 
spectrum operations; deliver leading-edge health services to 
our warriors and military family to optimize the clinical 
outcomes for those events.
    For those health care services not available in a military 
treatment facility and for those beneficiaries who don't live 
near a military treatment facility (MTF), we have established 
contractual relationships with civilian health care providers 
to fill those gaps. This part of the benefit is what we call 
the private sector care, or PSC; and it is managed by the 
TRICARE Management Agency, or TMA.
    The Office of the Assistant Secretary of Defense for Health 
Affairs, as you pointed out, sits above the direct care system 
and the private sector care, providing oversight and policy 
development.
    In a nutshell, the MHS exists to support warfighters on the 
battlefield. The direct care system exists to deliver medical 
readiness. Private sector care supports and fills the gaps in 
the direct care system. If form is to follow function, then the 
MHS should be optimally organized to support the direct care 
system.
    I don't believe this is always the case. For example, in 
the budgeting process, private sector care forecasts are 
considered ``must pay'', while direct care system estimates are 
considered ``unfunded'' requirements. The Department's priority 
has been to fund the private sector care at 100 percent of 
projected requirements, while many of our direct care system 
needs are not addressed until year end when overforecasted PSC 
funding becomes available for distribution to the direct care 
system.
    Since private sector care is often overprogrammed, they 
return money to the MHS, and they are seen as cost containing. 
Our direct care system health care bills are always after the 
fact and are seen as cost overruns. This resourcing construct 
appears to prioritize private sector care over the direct care 
system.
    I believe that Health Affairs, TMA and the service Surgeons 
General need to take a holistic look at the MHS to ensure that 
our functional relationships such as those for resourcing, 
adoption of shared, evidence-based practices between the direct 
care system and the purchased care system, optimal 
documentation in exchange of clinical and other information are 
all oriented toward support of the direct care system and that 
the organizational structure of the MHS follows accordingly.
    In closing, I would like to take this last opportunity to 
possibly publicly recognize my friend and colleague, Major 
General Elder Granger. He is a respected, gifted leader and 
clinician. He is a soldier/medic par excellence. It has truly 
been a privilege to serve with Elder, to be mentored by him. 
The Nation is truly richer for his service.
    Thank you for holding this hearing, ma'am. I look forward 
to your questions.
    Mrs. Davis. Thank you.
    [The prepared statement of General Schoomaker can be found 
in the Appendix on page 56.]
    Mrs. Davis. Admiral Robinson.

  STATEMENT OF VICE ADM. ADAM ROBINSON, USN, SURGEON GENERAL, 
                           U.S. NAVY

    Admiral Robinson. Good morning.
    Chairwoman Davis, Ranking Member Wilson, distinguished 
members of the committee, I am grateful to have the opportunity 
to share Navy medicine's opinion about the current organization 
of the Office of the Secretary of Defense for Health Affairs 
and the TRICARE Management Activity organization.
    Navy medicine is focused on meeting current operational and 
humanitarian mission requirements while proactively planning to 
meet the future health care needs of the Navy and the Marine 
Corps. These two distinct services have different needs, 
missions and operational requirements which require us to 
develop unique enhancements to our strategic ability, 
operational reach and tactical flexibility.
    Much has been accomplished between Navy medicine and the 
MHS, yet exigencies within the current environment require us 
to reexamine these organizations and the working relationships 
responsible for providing health care for wounded service 
members and their families.
    The experiences throughout my entire Navy career over 30 
years, including a tour at Health Affairs, have shaped my 
position on our relationship with OSD(HA) and TMA. Given that 
background, I am increasingly concerned that the lines between 
policy and execution have become blurred and may be 
compromising the effectiveness of this combined health care 
organization.
    As Ms. Embrey mentions in her testimony, the deputy 
assistant secretaries are dual-hatted in developing policy at 
HA and in executing that policy at TMA. Having one controlling 
activity and authority over MHS policy and execution means that 
checks and balances can be compromised. These conflicting roles 
create challenges for the services since they blur execution 
decisions that then become policy decisions that may compromise 
care to our operational forces and our beneficiaries.
    This structure also further divides the delivery of the 
benefit into two parts, in-house and network care, as General 
Schoomaker has outlined. What should be a collaborative process 
oftentimes becomes a competitive process.
    HA/TMA's oversight of the network assets available through 
the TRICARE managed care support contracts limits Navy medicine 
from leveraging those network providers at their disposal. Navy 
medicine supports a regionalized government governance plan 
with a flag officer or a general officer providing oversight 
for direct and purchased care services that is controlling the 
network assets. Each of the services would lead one region, a 
model similar to what is currently in place with the leadership 
of the TRICARE regional offices. This model provides the tools 
at the regional level to integrate direct and private sector 
care with the goal of optimizing care within the medical 
treatment facilities.
    Also, the ability to use network providers within the 
medical treatment facility may decrease the reliance of MTFs on 
contract support brought in to fill vacancies created by 
operational requirements.
    I have also grown increasingly concerned about the way 
ahead in relationship to the JTF CapMed organization and the 
San Antonio regional military medical center. It is unclear to 
me why these two organizations are being organized differently 
if the intent, as stated in Dr. Chu's memo from June of 2007, 
suggests that in both organizations the services would retain 
operational control of individual MTFs and all deployable 
personnel.
    The advisory role the services currently play in the 
policymaking process limits their ability to effectively impact 
the process. This limited role results in concerns and/or 
challenges not always being addressed when the final policy is 
disseminated.
    The services must be afforded a more active and influential 
role in the process. It is difficult for the services to have 
the responsibility to execute a policy and to be held 
accountable for said execution without the ability to affect 
and/or influence the policy.
    Chairwoman Davis, I am proud to say that Navy medicine is 
built on a solid foundation of traditions and a remarkable 
legacy of force health protection. We are committed to 
preparing healthy and fit sailors and marines to protect our 
Nation and to be ready to deploy at any time. We could not 
accomplish our diverse mission on our own, so our relationship 
with Health Affairs and with the TRICARE Management Activity is 
critical to our success.
    I hope my testimony provides you with the examples of how 
strengthening the relationship between HA/TMA and Navy medicine 
and, for that matter, the service medical departments through 
increased cooperation directly benefits our sailors, airmen, 
soldiers, marines and their families.
    Thank you very much.
    Mrs. Davis. Thank you.
    [The prepared statement of Admiral Robinson can be found in 
the Appendix on page 65.]
    Mrs. Davis. General Roudebush.

    STATEMENT OF LT. GEN. JAMES G. ROUDEBUSH, USAF, SURGEON 
                    GENERAL, U.S. AIR FORCE

    General Roudebush. Good morning, Madam Chairwoman Davis, 
Ranking Member Wilson, distinguished members. Thank you very 
much for this opportunity to share our thoughts with you this 
morning regarding this very important subject.
    Before I begin, I would like to join my colleagues in 
recognizing the extraordinary service of Dr. Ward Casscells, 
who has been a key member of this organization, a key member of 
our team for the last two years. I think his contributions are 
certainly something that I have appreciated. I have learned, we 
have worked together, and I think we have all profited from his 
presence.
    Likewise, General Granger has been an extraordinary ally 
and partner in meeting some very demanding circumstances; and I 
could not be more pleased to have the chance to simply say 
thank you for the record for General Granger and his service.
    As we meet this morning, Madam Chairwoman, I think it is 
important to understand that we operate as a team. Each one of 
us has a role. But in order to execute effectively, we have to 
execute as a team. And in order to meet the critically 
important and very demanding military health care mission, we 
must, we must operate as that team.
    And on the team we each have roles. For Health Affairs, the 
role is policy, oversight, guidance, coordination, setting that 
strategic vector, and as we always work for our civilian 
leadership to give us the lead in terms of many of our 
activities.
    TMA has their role, to manage and execute the defense 
health program which is a challenging construct, somewhat 
different than you will find in other departments and agencies 
but an activity that very much drives a good bit of our energy 
and focus in making sure that we get that particular aspect of 
resourcing correct.
    And, of course, TMA is our executive agency that oversees 
the managed care support contract, our private sector care 
allies and partners in delivering the full and comprehensive 
benefit to our active duty men and women and their family 
members, our retirees, those who have fought the fight and 
their family members as well.
    For the services, we have, as our role, a multifaceted 
responsibility.
    First, we support our Chief and our Secretary in providing 
them a healthy, fit force and supporting their title 10 mission 
in executing our national military strategy.
    Secondly, we support our separate service missions. For us 
in the Air Force, we support the Air Force mission here in the 
United States and globally, again, serving our Nation.
    Thirdly, we support our combatant commanders' requirements, 
meeting their mission around the world in a variety of very 
challenging contingencies.
    And lastly, of course, each medical service has 
organizational, training and equipping responsibility to be 
sure that the medics of today are able to meet that mission as 
well as the medics of tomorrow.
    So the services have a role, TMA has a role, HA has a role, 
and if we each execute those roles properly, the end result 
will be effective health care to the men and women so richly 
deserving that.
    I came into my position as the Deputy Surgeon one month 
before 9/11. I served as Deputy Surgeon until I assumed the 
role of Surgeon General in 2006. So I have some experience as a 
member of this team.
    Over that time, I have seen good men and women working hard 
to meet a very challenging mission. And we must never forget 
that. As I watched this team execute, I observed over that 
time, as we all are aware today and has been pointed out, that 
Health Affairs began to take on more execution responsibilities 
by merging with the TRICARE Management Activity and with an 
increasing focus on the execution within the direct care 
system.
    Now, we all work hard to execute our responsibilities, but 
we each have our lane, our roles responsibilities, and we need 
to be able to move within that lane to effectively accomplish 
those responsibilities. As we fast forward to this point in 
time, our direct care system, the service military medical 
system, Army, Navy and Air Force, is heavily tasked in meeting 
our critically important mission of providing that healthy, fit 
force, caring for our families and meeting the needs of our 
combatant commanders and our warfighters. We are doing it well, 
but it is a heavily tasked construct, and there is stress 
within the system.
    Adding to that stress are challenges in recruiting and 
retention as well as recapitalizing aging infrastructure that 
was designed to meet the mission of the past and not 
necessarily designed to meet the mission of today. And, at the 
same time, we are working hard to be cost effective, because we 
understand that military health care is becoming an ever-
increasing large part of the Department of Defense budget, and 
we each have the responsibility to be great stewards of that 
health care and providing the best return on every dollar. So I 
believe now is the right time to ensure that we are properly 
aligned as a team to meet this function.
    HA focused on policy oversight and guidance; the services 
focused on those title 10 requirements, meeting our service 
missions, meeting the combatant commanders' mission; and I 
would suggest TMA focus on managing the defense health program, 
as they have in the past, but really honing in on the managed 
care support contract to leverage the direct care system, as 
very strongly recommended by the Task Force on the Future of 
Military Health Care, to be sure that the direct care system is 
the focus of our system, that its capacity is fully utilized, 
that its capabilities are fully leveraged and that it is, in 
fact, fully maintained and optimized to meet the very 
challenging mission.
    So, in short, I believe the time is right. We owe this to 
every man and woman who raises their right hand and swears to 
support and defend. We owe them the very best health care 
today, tomorrow, 10 years from now, 30 years from now; and we 
owe them that health care in these demanding places where they 
go in harm's way such that we will, in fact, save their life, 
bring them home safely to their family member, if that is at 
all possible, and ensure them that their health care needs will 
be met and will be our priority. We will earn that trust today, 
tomorrow and every day coming with your support.
    I thank you for this opportunity to testify, and I look 
forward to your questions.
    Mrs. Davis. Thank you.
    [The prepared statement of General Roudebush can be found 
in the Appendix on page 70.]
    Mrs. Davis. Major General Granger; and, once again, thank 
you very much for your service.

  STATEMENT OF MAJ. GEN. ELDER GRANGER, USA, DEPUTY DIRECTOR, 
               TRICARE MANAGEMENT ACTIVITY (TMA)

    General Granger. Thank you.
    Good morning, Madam Chairwoman Davis, Ranking Member 
Wilson, other members of the committee and to my distinguished 
colleagues to my right here. I want to thank you for your kind 
compliments.
    I have really enjoyed my 32 years of active service and 
total of 36 years, including my time where I started off in 
Arkansas National Guard. I have had the awesome responsibility 
of serving as the Deputy Director of TRICARE Management 
Activity, and in this role my responsibility has been working 
with my colleagues to integrate the program for 9.4 million men 
and women around the world.
    We have done a number of things through your help and 
support. We have been able to put in a very aggressive, robust 
disease management program that has reached over 150,000 and 
netted a cost avoidance of about $30 million. In addition to 
that, we have had a heavy focus on meeting the needs of men and 
women in our Guard and Reserve in remote areas by working with 
our colleagues to my right as well as reaching out to those 
family members in terms of mental health support, having a 
toll-free number where they can get help anytime, 7 days a 
week, 365 a year.
    In addition to that, thanks to you all, we have been able 
to focus on prevention. Through your help, we will be able to 
put in place a very robust prevention program with no co-pays 
or deductibles designed to eliminate some of those barriers 
that we need to get good health care in this Nation.
    Last but not least, we have been ranked for six years in a 
row the number one health plan in the Nation. That in itself is 
due to the complement of all of us working together, focusing 
totally on the mission of taking care of the men and women in 
our uniform services.
    Last but not least, as I take off the uniform, it has truly 
been my honor to serve my colleagues for many, many years.
    I look forward to your questions, Madam Chairman and 
Ranking Member Wilson. Those conclude my brief statement. Thank 
you very much, and God bless you all.
    [The prepared statement of General Granger can be found in 
the Appendix on page 79.]
    Mrs. Davis. Thank you very much. We appreciate all of your 
testimony here today.
    I think there are a number of things that you have really 
identified, and one is the proper relationship between Health 
Affairs and TMA. I want to zero in for a second, General 
Schoomaker, on one of your statements; and I know that others 
will want to weigh in as well.
    You described private sector care as a gap filler. But 
since the purchased care budget is roughly double that of the 
direct care budget, hasn't private sector care then really 
become the main effort or at least in terms of the budget? How 
has that impacted care and does there need to be a shift back 
towards the direct care system?
    General Schoomaker. Well, ma'am, there is no question as we 
have continued in this war, as we have continued to mobilize 
National Guard and Reserves, as we have continued to employ the 
private sector care to close the gaps in the so-called white 
space of America where care needs to be delivered and we don't 
have facilities, we see more private sector dollars being spent 
out there.
    And I don't dispute the fact--I mean, the figures speak for 
themselves--that more and more money is going in that 
direction. But I started off my comments and I was gratified to 
hear that my colleagues are all in agreement with this, that at 
the end of this, we have to always remember that the 
centerpiece for the Military Health System is the direct care 
system and our ability to fully employ each one of our military 
treatment facilities in whatever form that exists to the 
fullest extent possible----
    Mrs. Davis. Could you and others paint a picture of how you 
think that relationship might be better developed?
    General Schoomaker. Well, ma'am, I think in those catchment 
areas--and the Army experimented with this very early in the 
course of the transitioning to a comprehensive managed care, 
the primary care based managed care system, placing military 
commanders in those communities, in catchment areas, in the 
control of and responsible for both the direct care and the 
purchased care system; and then on a regional basis, like my 
colleague, Admiral Robinson, has pointed out, having a military 
commander responsible for both execution of the direct care 
dollar and care as well as the purchased care dollar and 
building seamlessness not only in terms of where money is spent 
but also in terms of practices and exchange of clinical 
information. I am firmly one who believes that our future in 
cost containment is going to reside around our ability to 
embrace outcomes-focused, evidence-based practices; and I think 
that is done best in concert and through the military 
commander.
    Mrs. Davis. Do others want to comment? Do you think that 
the fact that that relationship perhaps doesn't exist today, 
that that is not where the balance is, that that gets in the 
way of doing what do you think is best?
    Admiral Robinson. I think that the relationship does exist 
today. But I think the emphasis is not on the relationship of 
trying to bring the direct care system and the managed care 
system, the network, together. There is a system that keeps us 
in parallel, but we are like two parallel railroad tracks. What 
we need to do--and this is the task force of the future of 
military health care--the number one recommendation was to 
bring together the direct care system, that is the uniform 
side, and the managed care side into the same system.
    Instead of taking our patients and sending them to the 
network, the network is our network. We need to bring our 
networks to our MTFs. We need to bring--we need to merge a lot 
of the activities that are occurring in parallel in our system. 
But, in fact, very often the direct care side, that is the MTF 
commanders, really don't have visibility on what is occurring 
on the network side. I am not suggesting that they don't 
understand what the policies for accessing the network are or 
how to do that. I am suggesting that we don't really have a 
system that leverages our networks so that it can help us on 
the direct care side.
    Mrs. Davis. Before we go on to the next member, I just 
wanted--Ms. Embrey, could you weigh in on this question a 
little bit? Because you have said that, basically, under title 
10 that the Secretary defines roles and responsibilities. And I 
think there is some question whether or not that is actually 
really not quite as you characterized it. Could you please 
weigh in on that issue?
    Ms. Embrey. I think that the segregation has to do a little 
bit with how money is segregated. We have to budget, and there 
is a firewall between what we can--we have to budget for, what 
our beneficiary population seeks in the way of care in our 
network, and we also have to budget for what we believe the 
performance and productivity and demand signals in our military 
treatment facilities. And there is a firewall. We can't move 
money back and forth easily without a reprogramming request.
    So I think part of it is artificial, institutional, and 
part of it is we attempted, I believe, to establish TRICARE 
regional offices, and when we originally established them from 
11 regional areas to three, we asked each of the service 
Surgeons General to identify uniformed flag officers to manage 
that so that we could get to that uniformed integration of and 
support in a regional area, that kind of integration that was 
testified to. To date, the Navy has been the only one 
consistently providing that uniformed officer.
    Mrs. Davis. Thank you. I know that we are going to come 
back to that issue.
    Mr. Wilson.
    Mr. Wilson. Thank you, Madam Chairwoman.
    Again, thank you all for being here; and I want to 
congratulate you. I believe that military medicine is leading 
the world in technology, research.
    It is so inspiring to me to know what you are doing in 
advancing--and I have visited the medical facilities with 
prosthetics, with head injury, trauma injury. What helps the 
military will also be so helpful to the civilian population, 
and I want to thank you for what you have done.
    Specifically, as a veteran and a parent, I this month 
visited the Air Force Hospital there at Balad; and it was 
really encouraging to me to know that there is a 98 percent 
survival rate of our troops who are medivac'd to that hospital. 
I just think that is so reassuring. And the American people 
need to know the quality of care that is provided.
    Specifically, prior to establishing the defense health 
program, funding--and this is for our service Surgeons 
General--funding for health care provided by the military 
services was included in the overall military service budget 
managed by the service secretary. Consequently, the Surgeons 
General had to compete with other programs within their service 
for resources.
    Now that you have had several years of experience with the 
defense health program (DHP), what method do you prefer? In 
light of the current health care demands within DOD, what is 
the most appropriate mechanism for allocating resources between 
the direct care and purchased care system?
    General Roudebush. Sir, as we have had experience with the 
DHP, we have two streams of resources. We have the dollars 
coming through the DHP, and we have the manpower which comes 
through our service secretaries. We have, I believe, 
established a system which in the main serves our purposes but 
does create some tension in terms of allocating resources.
    I will tell you that my view is I think there is some 
rationale with the DHP in terms of looking at health care 
resources writ large, with across three services and a very 
large Military Health System. I will tell you that the 
countervailing pressure on that, though, is my Chief and my 
Secretary, who view the health of their men and women, our 
airmen and their families as very much their responsibility 
within their title 10 responsibilities. So I feel very well 
supported by my line in terms of competing for resources and 
properly allocating those very scarce resources across my 
activities.
    The DHP is a balancing construct to a certain extent, and 
it does allow us to get the larger costs potentially of the 
private sector care which goes across services. That is not 
necessarily a simply service-specific issue, although with 
encatchment areas it can get very local. But, in the main, in 
being able to manage very large contracts, we do need to do 
that strategically from a corporate standpoint; and I think the 
DHP gives us the opportunity to do that.
    I agree with my colleagues, however, that balancing between 
the direct care system and private sector care is very 
challenging.
    The direct care system, to your point, Madam Chairwoman, is 
in fact the centerpiece and does actually three things: It 
helps us provide that healthy, fit force, it allows us to 
provide the benefit to all our beneficiaries to the full extent 
that we can, but it is also our training platform for our 
military medical personnel.
    So the direct care system needs to be robust and the 
centerpiece.
    Now, the private sector care wraparound to that needs to be 
in balance. And I agree with my colleagues that the direct care 
system needs to be trumped with private sector care being used 
to leverage the direct care system and also to leverage the 
capacity. Because the direct care system in many regards has 
sunk costs. So the greater capacity we have within the direct 
care system, the more cost effective our system is overall. So 
I think the DHP in the main allows us to get at that.
    There is some tension with that. However, my chief, my 
secretary paid very close attention to that balance and that 
tension which I think helps us keep some rationality and 
balance within it. But it does create tension.
    Mr. Wilson. Thank you very much.
    And General Schoomaker may want to comment, too.
    General Schoomaker. I will just say very quickly, sir, 
unequivocally, from my perspective, the creation of the DHP by 
the Atwood memorandum was a good thing. And to go back through 
the door of breaking health care costs among the services I 
think would be a backward step to take. It has allowed us to 
see, to develop a level playing field to the best of our 
ability across services. It has allowed us to raise to a much 
higher level of visibility the needs of our beneficiaries for 
care and for all of the even deployment-related issues that we 
have.
    I think what you are hearing, and I can completely agree 
with General Roudebush, is you are hearing a series of 
tensions. One, the tension between the direct care system and 
the purchased care system and where that should be balanced, 
and the other is the balance between oversight and policy 
development by Health Affairs and execution by the services. 
Increasingly, we are seeing Health Affairs take on the role of 
execution; and doing that I think it erodes some of the 
goodness of the DHP.
    Admiral Robinson. I, too, agree with my colleagues on the 
DHP. It would be wrong. I think it would be a major mistake to 
go back to any other system other than the DHP. Service input 
into how the DHP, how that DOD program is, in fact, executed is 
the tension that I think I would like to just comment on.
    The services need to have some direct input into the 
processes of how the DHP is executed. In recent years that 
hasn't always been as clearly demonstrated to me. I am not 
suggesting it hasn't occurred. I just haven't been able to 
clearly see the occurrence of it.
    So I think that is where we should look at it. But I would 
not change the system that we have developed. No.
    Mr. Wilson. Thank you. Very encouraging. Thank you.
    Mrs. Davis. Thank you.
    Dr. Snyder.
    Dr. Snyder. Thank you, Madam Chair. Thank you all for being 
here.
    I want to direct my questions to the three of you that hold 
the title of Surgeon General (SG). I am phrasing it that way 
because I don't think if the plural is Surgeons General or 
Surgeon Generals.
    General Schoomaker. Surgeons General.
    Dr. Snyder. This is one of those discussions this morning 
that is probably a very, very important one to a lot of our men 
and women in uniform and their families. It is just--it is one 
of these discussions which, while important, can give 
government a bad name. Because it comes across as a bunch of 
gobbledygook that most of us don't understand.
    I appreciate you for being as forthcoming as you are in 
trying to sort it out and make recommendations, but I want to 
try to give you a couple of theoreticals and little anecdotal 
things.
    Have you, the three of you, if you would walk me through 
how you--this tension that you all are describing, how it may 
impact on patient care. I will throw out a couple of examples, 
and you can tell me if it doesn't have anything to do with it 
or examples of what you are talking about.
    The first example is the special needs kids I think some of 
us have talked about before. General Schoomaker, you talked 
about supporting our warfighters overseas; and I think nothing 
creates more heartache for our folks overseas than if they have 
a special needs child and the child is not getting the kind of 
care that they think they need while at a military facility 
someplace. So let's take a child with insulin dependent 
diabetes or autism or something that requires a fairly 
intensive amount of help.
    And the second example might be I think a lot of us have 
run into over the last several years, would be somebody in the 
Reserve Component who is mobilized for active duty for a period 
of 18 months or so. Their family then goes into the military 
health care system but may geographically be living in a place 
not near a base, not near providers who are used to dealing 
with TRICARE.
    So what I would like each of you to do--and just tell me if 
I am off base and maybe the tensions we are talking about or 
you all are discussing have nothing to do with these examples--
but how does what you are talking about relate specifically to 
our men and women and the care that they give? And if these are 
a couple of examples where it may give you an opportunity to 
describe how the tension may relate to the actual care that men 
and women and their families get.
    General Schoomaker. Well, candidly, sir, from my 
perspective, both of the cases--I will be interested in hearing 
what my colleagues have to say--both of those cases I think are 
not necessarily confounded by the tensions that we are creating 
here. I think both of them, in many cases, are attributed to 
the farsightedness and the vision of setting up a TRICARE 
system as we did 15 years ago or so.
    In the case of special needs kids, we have an 
extraordinarily generous benefit which is fairly uniformly 
applied; and, in fact, I think it has resulted in the military 
health care system being one of the elements of families' 
decision with a special needs child to stay in uniform.
    So I would have to say that that doesn't necessarily--I 
don't see my role in executing these programs as being 
interfered with in any way, shape or form in taking care of 
special needs kids.
    I would have to say the same about the mobilized Reserve 
Component, the National Guard and Reserves, many of whom come 
from places in this country where we don't have a robust direct 
care system. In central Idaho, parts of Montana, Wyoming, we 
don't have large, robust medical centers and health service 
systems.
    And so, having an effective purchase care system and a 
managed care support contractor that is reaching out and 
providing care to those families I think, again, reflects the 
farsightedness of a well-executed TRICARE program. I am not 
taking away from any of that part of it.
    Admiral Robinson. I would connect this a little 
differently. I don't completely disagree with General 
Schoomaker, but I think that the autism and the insulin-
dependent diabetic do come into play in this regard. First of 
all, the private-sector care, the network care, and the direct 
care can both play here.
    Let's take Twentynine Palms; I will just take a Marine 
Corps base in southern California. Very remote location, I am 
not going to be able to get network care there. It is going to 
have to be direct care. It is going to have to be uniform care.
    Now, when I say I can't get it, there are people that will 
go there, but that is very difficult. So I have places in this 
country that are very difficult to, in fact, get network care. 
That means I need it in uniform.
    However, very often there has also been--and I don't want 
to get caught in the mire of the gobbledygook, but there are 
also thoughts that very often we on the direct care side in 
uniform should be there for very specialized war-fighting 
activities that make us incredibly essential for the battle and 
for the things that the military system in fact was built to 
do. But, in fact, in 2009, we have taken on added 
responsibilities, which include garrison and family care.
    So my question then is, I need pediatric endocrinologists 
as much as I need trauma surgeons, but it may be difficult 
sometimes to, in fact, get there because of how we have, in 
fact, looked at what we think we should get from the war-
fighting versus the non-war-fighting situation.
    Now, I am not suggesting to you that anyone is denying the 
Navy or the other services pediatric endocrinologists. I am 
just simply saying that there is a tension that does exist 
because of some thoughts and some assumptions made as to how we 
really should, in fact, divvy up our uniformed versus our 
network.
    I would like to add just one other thing. I am not going to 
comment on the Reserve Component. I think that General 
Schoomaker's answer would be mine also. I would only like to 
say, overseas, with our EDIS, Educational and Developmental 
Intervention Services programs, and also our Exceptional Family 
Member programs, this is also the case. Because overseas we are 
not able to, in fact, engage network care. So if I don't have 
it, if I can't either contract it to bring it or if I don't 
have it in uniform, it is much more difficult to get.
    And those are just challenges that I must look at. I am not 
suggesting that anyone is keeping me from getting there, but 
these are the challenges from an SG's perspective that I must 
look at.
    General Roudebush. Congressman, I think you raise a point 
that really brings out the essence of what we are talking about 
this morning. There is a role and relationship, and it is not 
``either/or,'' it is ``and.''
    For us in uniform, there are, in fact, places where we are 
going to need to have in uniform specialty capabilities for 
family members, because family care is mission impact. When our 
men and women are in harm's way, if they are not confident 
their families are fully cared for, they will not be focused on 
what is in front of them. And that has mission impact. So 
family care plays directly into the mission.
    For us, TRICARE gives us that wraparound in those 
circumstances where we may not have the capability readily 
available for our Reserves in areas where we don't have a 
facility available, for example. Or for special needs 
youngsters, we may not have that readily available within the 
uniformed service. TRICARE gives us that wraparound capability.
    And, quite frankly, when you get to specialty care for our 
youngsters, that is rather expensive to make and sustain in 
uniform. And the more cost-effective solution and clinically 
effective solution, in many circumstances, is, in fact, to 
contract for that capability and that care through the private-
sector TRICARE.
    So it is not ``either/or,'' it is ``and,'' and finding the 
right balance, each of us within our roles, to get that mission 
accomplished. So I think you do raise an intersection that is 
critically important for us to get right.
    Mrs. Davis. Thank you.
    I am going to move on to Ms. Tsongas.
    Ms. Tsongas. Thank you.
    I am enjoying this testimony. And I have to say, much of 
this is, as a new Member, relatively new Member, much of it is 
very new to me.
    I have to say, many years ago, as a child of the Air Force, 
I needed very delicate eye surgery. And I was in an Air Force 
hospital at Langley Air Base and then subsequently at Tachikawa 
Air Base, and I received remarkable care. And, again, I was 
with Congressman Wilson in Balad, where we did see the 
remarkable work that you are doing.
    But, obviously, we are in a time and an era when health 
care is far more complicated and far more expensive. And it is 
clear that you are wrestling with both on multiple layers.
    My question, slightly different, though, is we have 
representatives of the different services, and you obviously 
have different cultures, sometimes very different needs, as a 
result of the roles you play. And I am just curious how this 
plays itself out, given the different tensions that you all 
have described. Is it another layer to it, or is it really not 
particularly significant?
    General Schoomaker. Well, I will speak for the Army. I 
think, ma'am, it is very significant. And I think it is why we, 
not for parochialism or not because we are looking to build 
duplication or triplication within the defense health system, 
why we insist on executing our programs within each one of our 
services.
    Each one of the services, for very, very good reasons, has 
important differences in how it fights war and how its military 
health care uniformed members support the deployed force. And 
that is not to say that there aren't commonalities and, in some 
large metropolitan areas like in the national capital region or 
San Antonio, we can't find shared platforms where we can retain 
common skills, where we can share the opportunities in the 
greater Washington area where we have 36 or 37 different health 
care facilities across the three services, from Pennsylvania 
down to Quantico and as far west as Fort Belvoir. We have 
plenty of opportunities to share those platforms for caring for 
about a half-million beneficiaries.
    But when it comes down to ships at sea and brigades in 
battle, some of the remote sites that General Roudebush and I 
in the Army have to service, the service cultures are very, 
very much a part of this. And it is why we, as service surgeons 
general and commanders of our medical forces, want to have a 
very firm grasp on the execution of these programs.
    Admiral Robinson. Each service has a concept of care. I 
think that, as the long war has continued in both Iraq and 
Afghanistan, our concepts of care have actually become much 
closer together; they have merged.
    From the Navy's perspective--I am not speaking now for the 
Army or the Air Force, but I don't think they are much 
different--patient- and family-centered care is our concept. It 
is what we think is important in order to make sure that we can 
meet the mission, both the operational--that is, the war 
mission--as well as the family and the garrison care mission, 
because we can't separate them out any longer.
    Since people on the battlefield, men and women, can now e-
mail and text message family members during an intense 
encounter, it is no longer the case that I can, in fact, not 
take care of families as I am also taking care of men and women 
on the battlefield. We have moved into another era of 
communication, of technology, and of the insistence by the 
people that are our beneficiaries that we, in fact, care for 
them in a very organized and meaningful way.
    And that is what I think all three services do, but we all 
do it differently, leveraging those things that our service 
chiefs and the equities of Army, Navy, Air Force, and Marine 
Corps must have in order to meet their missions and, at the 
same time, making sure that we leave no patient, no family, and 
no member behind.
    Ms. Tsongas. And do the Health Affairs and TRICARE 
management acknowledge this, in your relationships? Or is it 
yet one more of those things that, again, is a source of 
tension?
    Admiral Robinson. I think that Health Affairs does 
acknowledge that. I think that they do, in fact, understand the 
differences in the services and how to meet them.
    I also think that, very often, the concept of what is 
important from a patient perspective can sometimes get clouded 
or get shaded in relationship to the business perspective of 
efficiencies and effectiveness. Now, that is the world that we 
live in, so I am not complaining to you about that, because 
everyone has to look at costs and has to look at the bottom 
line that we are trying to get done.
    The key here in medicine is that patients usually, when 
they are coming to you and they need something to save their 
lives, they need something that they think is going to be 
absolutely essential to their wellbeing, are not interested in 
hearing the business rules involved in doing that. My job is 
to, in fact, take that into account and to balance that out 
with the needs of the patient.
    Mrs. Davis. General, do you want to comment?
    General Roudebush. Just very quickly.
    At times, folks will talk about culture and say, well, 
culture is interesting. I would suggest to you that culture is 
a significant part of what we do.
    We have an All-Volunteer Force. Every soldier joins the 
Army because he or she is attracted to the mission and the 
culture. Likewise, every sailor, Marine, and airman joins that 
service because they are attracted to the culture and the 
mission. Their families are wrapped in that culture. We care 
for our servicemen and their families within that culture and 
within that mission ethos.
    So culture is a big part. And, particularly when these men 
and women are injured or ill, that culture wraps around them 
and supports them, helps them through that recovery, 
rehabilitation. So it does play a role.
    And while many of the clinical activities are certainly the 
same in the Army, Navy, and the Air Force, that wraparound, 
that family, that team that is caring for them is an important 
part of the construct. And I think that can't be lost in the 
discussion.
    Mrs. Davis. Thank you.
    Mr. Jones.
    Mr. Jones. Madam Chairman, thank you very much.
    And I regret that I was not here for your opening 
statements, but I do appreciate what you are doing. This is a 
very difficult time for our men and women in uniform, certainly 
a very difficult time for our Nation. And, certainly, health 
care for the private sector, as well as the military sector, is 
at the forefront of many discussions here in Washington, as 
well as debates.
    Admiral Robinson, I want to thank you. You and your staff 
did a very excellent job of responding to a question I had 
about autism and autism programs down at Camp Lejeune. And I 
was very much appreciative of the information and the work that 
you all are doing, quite frankly.
    And, as I have heard many from each services talking about 
the fact that the world is becoming more complicated, looks 
like we are going to be in Afghanistan for a long period of 
time--I hope not, but it looks that way--and, therefore, there 
is going to be more stress and pressure on the military 
families. And, in a response--and this is not a criticism, but 
you realize that, as a Member of Congress, we have our 
districts, we have people in our districts, both military and 
nonmilitary, that have questions about services and programs 
for families. And I, again, was very pleased and satisfied with 
the response that you gave me to the questions that we asked on 
behalf of parents down at Camp Lejeune.
    But the only point I want to make and ask you this 
question--and I know you don't have this before you, but we 
asked the question, ``How many of the above dependents are 
enrolled in the TRICARE Extended Care Health Option (ECHO) 
program as of 12/31/08? Please break down your response by 
location, Camp Lejeune and San Diego.'' I won't go through your 
response; I want to get to the question.
    Then you gave me that answer with the numbers, which was 
helpful, because obviously there are more children in that San 
Diego area, with the Navy base and Camp Pendleton, than there 
would be at Camp Lejeune. But still we have children with 
autism at Camp Lejeune.
    So the next question was, ``How many of the above 
dependents are receiving applied behavior analysis (ABA) 
services under the TRICARE Enhanced Autism Service 
Demonstration as of 12/31/08? Please break down your response 
by location.'' The response was, ``There are 118 dependents 
receiving applied behavior analysis services, 68 Navy families 
and 50 Marine families, for the San Diego and Camp Pendleton 
catchment area. There are no dependents receiving ABA services 
under the TRICARE Enhancement Autism Service Demonstration in 
Naval Hospital Camp Lejeune, Naval Health Clinic Cherry Point, 
and Marine Corps Air Station New River.''
    So then the next question--now I am going to get to the 
final--``How many ABA therapist providers are serving military 
families in Camp Lejeune catchment area under the Autism 
Service Demonstration Project? How many providers have signed 
on in the San Diego area?'' This is the question I was trying 
to get to. ``There are no ABA network providers in the Naval 
Hospital Camp Lejeune area. There are 10 ABA supervisors and 82 
ABA tutors serving military families in the San Diego area.''
    I am not being critical, because, again, we all know what 
the numbers game is. I mean, we are all under stress here in 
Congress, as well as you in the military. But my point would 
be, though, realizing there are more children in that San Diego 
area, the fact that we have none at Camp Lejeune, can that be 
re-evaluated?
    And, I mean, not saying that we need to have the equal 
numbers of the professionals at Camp Lejeune that we have at 
San Diego or Camp Pendleton, but to say that we have none is 
somewhat of concern, not only to the parents down there, but to 
myself.
    Is that something that can be reviewed to see if the 
justification, realizing the restraints that you are under--but 
is there any way we could see if we could get some of those 
professionals at the Navy Hospital at Camp Lejeune?
    Admiral Robinson. Well, Mr. Jones, thank you very much for 
your compliments and also the fact that we have been working 
with your staff on some of these issues for a while, and I 
appreciate that.
    The answer is, yes, it can be reviewed.
    The second answer is that the fact that there are none may 
not tell the complete story, because there may be other sources 
of that type----
    Mr. Jones. Right, that is true.
    Admiral Robinson [continuing]. Of therapy that the children 
can receive.
    Thirdly, the amount of contractors and people who will go 
and who will actually stop in Jacksonville, North Carolina, 
vice San Diego, California. So the geographic area does make a 
difference.
    Bottom line, though, sir, to you is that we in Navy 
Medicine and, actually, we in the Military Health System are 
absolutely committed to children wherever they may be, no 
matter what their location. So we will revisit that and look at 
that.
    I happen to know that the system that we have in Camp 
Lejeune is more complicated than the numbers you suggest 
because of differences in the network emphasis on certain of 
the behavioral health assets; how we are, in fact, deciding who 
can deliver that ABA care; who is involved. There are a number 
of facets to that particular question. But, yes, sir, we can 
look at that again, and we will, in fact.
    Mr. Jones. Thank you, Admiral.
    Thank you, Chairman.
    Mrs. Davis. Thank you.
    Ms. Fallin.
    Ms. Fallin. Thank you, Madam Chairman.
    Appreciate all that you do for our Nation in delivery of 
medical care to our service men and women. I know it is tough 
under limited financial constraints that you have and so many 
different regions of the world that you have to deliver care.
    I was just curious about--because we have had so many men 
and women serving, probably more than ever, in deployments 
across the world, and with the events after 9/11 and the fight 
on terrorism and the large numbers of men and women who have 
been called up, when they start to come back home to the United 
States, you are going to have a lot of veterans and a lot of 
soldiers who will be going into the health care system for many 
different reasons, whether it is just regular care from 
injuries or regular medical care or post-traumatic stress 
syndrome, whatever it might be.
    What type of plans have we made? And do you have the 
resources you need to meet all the large numbers of people that 
will be coming home over the next many years?
    General Schoomaker. Well, ma'am, I mean, therein lies 
probably the biggest question we are all facing.
    And, first of all, starting with what the estimates are of 
the kinds and types of illnesses and injuries that we are going 
to be seeing, I mean, the vast majority of wounds of war, quite 
frankly, are not visible wounds. And one of the major efforts 
that is undergoing right now within the Department of Defense 
is to get a grasp on what the state of current science and 
understanding of all of the neuropsychiatric injuries, whether 
they are physical injuries to the brain from concussion or 
whether they are psychological consequences of deployment and 
the exposure to war and the like.
    We have conducted in the Military Health System, through 
epidemiologists out of the Walter Reed Institute of Research, 
over the last six years a recurring, fairly tight scientific 
study called, for the Army and Marine Corps, a Mental Health 
Advisory Team, which has done estimates of what the volume of 
problems is and what the nature of those problems are and when 
they emerge. And that has helped us.
    We worked very closely with the Department of Veterans 
Affairs (VA) and our TRICARE managed care support contractors 
to ensure that we have the network of care available, both 
within the Federal system and within the private care system. 
But I think this is something that keeps all of us up at night.
    Ms. Fallin. Do you feel like your proposal on your system, 
the changes that you are talking about in your hearing today 
will move you closer to that goal?
    General Schoomaker. Well, ma'am, this kind of overlaps with 
the question that Congresswoman Tsongas had about the 
acknowledgment of the cultural differences and the challenges 
to each of the services.
    Frankly, at my level of command, acknowledgment is 
represented in dollars. And, as I said in my opening statement 
earlier, when I find my budget not programmable in a 
predictable way but private-sector care programmable, then I 
have a very difficult time developing a stable business 
platform for my medical treatment facilities, which I am 
compelled to give a lot of my family and soldier care around. 
And that is a great deal of the tension that we have talked 
about here this morning.
    Ms. Fallin. One of the concerns I hear in my community and 
in the State of Oklahoma is how we don't have enough people to 
handle post-traumatic stress syndrome, as far as counseling and 
diagnosis and psychiatry, whatever level of care it might be, 
that we don't have those people on board yet, and there is a 
shortage, and it is hard to get that care in the local states.
    And what are we going to do to address those things? Is it 
a matter of funding?
    Ms. Embrey. The Department has recognized that there is a 
national shortage to the citizens of America and not just the 
military, although the military certainly has a high demand for 
those services. And we have been given a fair amount of 
resources from Congress to assist us in expanding that 
capability.
    And we are leveraging many different approaches, to include 
bringing in social workers and other folks and tiering the 
capabilities so that we assure that the assets that have the 
certifications and capabilities are dealing with those that 
need those services and that we distribute the other services 
to sometimes nonclinical but certainly qualified individuals to 
aid in early intervention and then referral to appropriate 
higher-level care.
    Ms. Fallin. Ms. Chairman, if I can just finish one last 
question, someone had mentioned to me yesterday about some new 
research being done with--and I hope I am saying this right; 
you are the physicians--hyperbaric chambers, when it comes to 
the treatment of post-traumatic stress syndrome. Have you seen 
any type of research that might indicate it would be helpful?
    General Roudebush. Ma'am, I believe what you are referring 
to is focused, at least for the moment, on traumatic brain 
injury and hyperbaric oxygen. And that, in fact, is being very 
aggressively pursued with the Defense Centers of Excellence on 
Psychological Health and Traumatic Brain Injury to really be 
sure that science is applied to that, to assure that we have 
the best therapeutic modalities positioned for the men and 
women, and that we are able to apply those therapies to the 
best outcome.
    So, yes, ma'am, that is in the center of the scope and is 
being very aggressively pursued for all three services, as we 
have all individuals in harm's way with that particular outcome 
as a risk for these men and women.
    Ms. Fallin. Okay.
    Thank you, Ms. Chairman.
    General Granger. Madam Chairman, can I comment on that 
statement for a second?
    In reference to the families, we have stood up with our 
managed care support contractor partners toll-free numbers they 
could call. And based upon data in the last three years, the 
number of family members using our mental health capability in 
our network has increased significantly. We would be glad to 
share that data with you for the record.
    Thank you.
    [The information referred to can be found in the Appendix 
on page 103.]
    Mrs. Davis. Thank you. I appreciate that. I appreciate the 
question, because I think that we could certainly have a 
hearing focused solely on mental health care and what is 
happening to support the services that are out there, the kind 
of research and development that is being done, to be certain 
that we don't have wholespread duplication, and, at the same 
time, what we are doing to really help the families be able to 
move through this problem that they are all having. And very, 
very important, so I appreciate some focus on that.
    I wanted to--now, see, we have a vote coming up, and I 
don't know whether folks can come back. We can try and have two 
more questions, and then we will make a decision about whether 
to ask you to wait here. That may be it.
    I just wanted to get back a second to the oversight 
question, because I understand the tension and the balance that 
we are talking about. I think, General Roudebush, you mentioned 
in your statement that, in many ways, TMA's current level of--
the current level that you mentioned of the oversight over the 
military treatment facility is fairly extensive and somewhat 
excessive, as well.
    And I just wonder if you could talk to us more about what 
you think the right structure then for Health Affairs for TMA 
would be to better provide oversight to the services?
    General Roudebush. Yes, ma'am. It is a collaborative 
relationship. It really is an ``and.''
    Health Affairs, my view, my experience, is most effective 
and, in fact, has and continues to be very effective at 
providing that strategic policy guidance, the coordinating 
oversight to assure that we are leveraging capabilities across 
all three services, taking efficiencies where those are 
certainly available to make the best return on every taxpayer's 
dollar.
    But in terms of how that translates into the facilities, if 
you look at how we have operated in the past, responsibilities 
have been given to the service, in executive agencies, for 
example, to perform particular functions. Some of those 
executive agencies have been migrated into the TRICARE 
Management Activity. Now, I won't say that is uniformly good or 
uniformly bad. However, those kinds of responsibilities have 
been migrated away from the services. And I think we need to 
examine very closely the activities that are resident within 
TMA and resident within the services.
    My strategic construct is that TMA is absolutely essential 
in managing the DHP to make sure that we have the right tension 
and balance across competing resources; and in managing the 
managed care support contracts, to be sure that the direct care 
system is the centerpiece and that our private-sector care is 
leveraged toward that.
    Mrs. Davis. Where do you see that discussion taking place? 
Are you saying that you don't think that you are able to have a 
strong enough voice, that all of you are able to have a strong 
enough voice in that discussion, and that decisions are made 
perhaps irregardless of some of those wishes?
    General Roudebush. I think perhaps the latter. There are 
times that decisions are made that we don't have full 
visibility and/or perhaps the coordination or input that we 
might prefer in some of those discussions.
    And I would certainly welcome comments from my colleagues 
relative to that particular aspect.
    General Schoomaker. I would have to agree. I mean, 
candidly, I think all too often a lack of complete unanimity 
opinion among the three services when it comes to allocation of 
resources or programming resources translates into Health 
Affairs making a decision on their own. And that is an area 
where I don't think it is a function of structure per se; it is 
a function of allocating to us a certain authority to be 
complete partners in this process.
    And it keeps coming back, for me, to this struggle that I 
have and my service has in developing a stable business 
platform for all of my hospitals, when many of our needs are 
relegated to unfunded requirements until the very late part of 
the fiscal year in the budget year. It is a tough way to run a 
business.
    Admiral Robinson. I would have to agree with that. I think 
that I can give you--I can go down into the interstices of 
this, which I am not going to do because it would not be 
helpful, but I agree with both colleagues. I think that the 
Surgeons General need to have a say that is meaningful, and the 
services need to have a say that is meaningful.
    The services do not run nor is the DHP their account. They 
are all three responsible for that DHP account. And, therefore, 
they need to have some visibility of how it is executed. And 
that is absolutely important. Often, that has not occurred, in 
my tenure as Surgeon General.
    Mrs. Davis. Major General, could you comment? Is that by 
design? Or what gets in the way of that?
    General Granger. Let me tell you what gets in the way, 
ma'am. I would concur with my colleagues. What we are dealing 
with is policy at the Health Affairs level. We are talking 
about execution at their level, oversight, Health Affairs, and 
then having a feedback loop on how we work in a very 
collaborative way. The lines are blurred in terms of what is 
policy, what is execution, and what is feedback. And we don't--
--
    Mrs. Davis. Is it because of the reporting process? Is that 
part of it?
    General Granger. In my opinion, it is because of the 
reporting process. It is not exactly what is what, because when 
you say HAVMA, that could be all of us or none of us. That is 
my understanding.
    So you need to separate what is policy oversight, execution 
by the services, what is the oversight of how they execute 
that, and what is the feedback loop we all get to make sure we 
are fulfilling the needs of our men and women in our uniformed 
services.
    Mrs. Davis. Ms. Embrey or Ms. McGinn, would you like to 
comment?
    Ms. Embrey. I would like to comment, yes. I think----
    Mrs. Davis. And quickly. I am sorry, we just have a few 
minutes. You can write us more about that, too. Go ahead.
    Ms. Embrey. Okay. I will tell you more in writing.
    [The information referred to can be found in the Appendix 
on page 103.]
    Mrs. Davis. If you would rather do that.
    Mr. Wilson, did you----
    Ms. Embrey. I thought you wanted me to stop.
    Mrs. Davis. Mr. Wilson, did you have a question, briefly?
    Mr. Wilson. One brief question, to conclude.
    The Office of the Assistant--this is for our DOD officials 
here--the Office of the Assistant Secretary for Defense for 
Health Affairs sets the policy for the MHS. The TRICARE 
Management Activity implements the policies of the MHS. 
However, the leadership of the two organizations are the same.
    What would be the checks and balances in such an 
organization?
    Ms. Embrey. The checks and balances are a series of 
governing councils where we engage all of the principal leaders 
of the Department at various levels. Each person who is double-
hatted has an integrating council, which involves 
representation from the service surgeons generals as well as 
the joint staff and the combatant commands when appropriate.
    We engage with them on the issues and discuss how the 
current policies aren't working and how to implement new 
policies or programs, whether they are directed by Congress in 
law, whether report guidance, or whether or not it is the 
Administration itself who says we need do something 
differently.
    When we have a change in direction, as many as we have had 
over the last six years, we have had to leverage those 
integrating councils to understand what the problem is, get a 
common vision on the way forward, and to get consensus on the 
way to approach solving the problem in near term. And that is 
the way we have approached that over time.
    We did not have available resources to be able to hire new 
SESs in the TMA structure as well as the HA structure. And so 
we double-hatted many individuals to ensure that the form 
followed the function, that the policy understood what the 
problems were, set up the programs to do it, and then set up 
the program evaluation and quality assurance programs necessary 
to make sure that, when they were implemented and executed in 
the services, that they were accomplished in a way that they 
were intended.
    So I believe it has been a collaborative process all along. 
And that is my personal opinion.
    Ms. McGinn. And if I could add a 10-second check and 
balance to that, you do have an Under Secretary of Defense for 
Personnel and Readiness who has responsibility to oversee the 
Assistant Secretary for Health Affairs and, I think, also to 
look at the issues brought forward by the stakeholders.
    As I said, he or she chairs the Military Health System 
Executive Review. Issues can be brought to that review from the 
stakeholders and discussed in that forum.
    So there is an oversight responsibility there, as well.
    Mr. Wilson. Fine. Thank you.
    Mrs. Davis. Thank you very much.
    I think there is obviously some difference of opinion, and 
I think part of what we are interested in is trying to make 
certain that everybody does have an opportunity to express 
that. And we would certainly look forward to working with all 
of you as we try to, you know, sort all this out.
    The bottom line, as we said, is the care of the men and 
women who serve our country and their families. And we want to 
be certain that we are doing this in the most efficient way, 
that looks at costs, looks at access and care, care in a larger 
fashion of how people feel valued within the system.
    And so we appreciate all of your remarks today. This is the 
beginning of this conversation, in many ways. We intend to look 
further at it. And we certainly appreciate your concern.
    Members have an opportunity to submit their questions for 
the record.
    And we wish you the best today. Thank you.
    [Whereupon, at 11:33 a.m., the subcommittee was adjourned.]

=======================================================================

                            A P P E N D I X

                             April 29, 2009

=======================================================================

              PREPARED STATEMENTS SUBMITTED FOR THE RECORD

                             April 29, 2009

=======================================================================
      
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
      
=======================================================================
                   DOCUMENTS SUBMITTED FOR THE RECORD

                             April 29, 2009

=======================================================================

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
       
=======================================================================

              WITNESS RESPONSES TO QUESTIONS ASKED DURING

                              THE HEARING

                             April 29, 2009

=======================================================================
      
              RESPONSE TO QUESTION SUBMITTED BY MRS. DAVIS

    Ms. Embrey. Health Affairs believes all leaders in the 
Military Health System are afforded numerous opportunities for 
their voices to be heard through our corporate governance 
structure. Today, Military Health System enterprise-wide 
deliberations follow the tenets of a March 2006 Assistant 
Secretary of Defense (Health Affairs) memorandum, ``Policy on 
Military Health System Decision Making Process.'' The Services' 
Surgeons General play a critical role in this oversight 
process. Health Affairs, TRICARE Management Activity, the 
Services' Surgeons General and their staffs engage from the 
level of subject matter experts to the level of the senior 
principals.
    The Military Health System is governed through ongoing 
collaboration, consensus, and compromise. We achieve this 
through a governance structure which engages key stakeholders 
on a weekly basis. We use the same structure and collaborative 
leadership process to determine outcome performance measures 
for which all Military Health System components are held 
accountable. This process provides a framework to achieve 
agreement and approval on what is in the best interest of the 
Military Health System. The process also provides a weekly 
venue in which all voices have an opportunity to be heard.
    A critical part of this framework is the use of integrating 
councils. Each Deputy Assistant Secretary of Defense (DASD) for 
Health Affairs and the Deputy Director, TRICARE Management 
Activity chairs an integrating council to ensure functional 
integration of complex issues. Each week, at the subject matter 
expert level (typically O-6 level), functional steering groups 
work through key decision issues in areas such as clinical 
policy, force health protection and readiness, health plan 
operations, and financial management. Decision recommendations 
from these working groups roll-up to the two-star integrating 
councils, in which the Deputy Surgeons General participate. 
Finally, each week the Senior Military Medical Advisory 
Council--chaired by the Assistant Secretary of Defense (Health 
Affairs) and including the Services' Surgeons General--meets to 
review informational and decision briefings. Four-star level 
Military Department officials (i.e., senior civilian 
leadership) and Service line leaders are also formally engaged 
in the decision making process through the Military Health 
System Executive Review.
    Beyond these formal and institutionalized informational and 
decision forums, informal communication, collaboration, and 
coordination occur at all levels nearly daily among Health 
Affairs, TRICARE Management Activity, and the Services--from 
action officers to the most senior officials. [See page 27.]
                                ------                                


      RESPONSE TO QUESTIONS SUBMITTED BY MS. FALLIN AND MRS. DAVIS

    General Granger. We have stood up toll-free numbers that our 
beneficiaries can call. These resources are provided by TRICARE region 
in the attached documents.
    Additionally, regarding the trend in family member utilization of 
network mental health capability, the TRICARE Management Activity 
recently completed its annual assessment of expenditure and utilization 
trends for mental health services in both direct care (military 
treatment facility) and purchased care venues. The update added data 
for Fiscal Year (FY) 2008 to those previously gathered for the FY 2002-
2007. Substantial year-over-year percentage increases continue in 
mental health care expenditures and workload for TRICARE beneficiaries, 
with the bulk of the increase directed to care for our Active Duty and 
Reserve warriors, as well as for their families. From FY 2007-2008, 
expenditures increased by 15 percent. Inpatient days grew by 16 
percent, and outpatient visits grew by 15 percent. The private sector 
has displayed an impressive capacity to accommodate increases in demand 
for mental health services for TRICARE beneficiaries. Over the period 
FY 2002-2008, purchased care inpatient days increased by 97 percent, 
and outpatient visits increased 133 percent. Corresponding changes in 
direct care workload were a decrease of 19 percent (inpatient days) and 
an increase of 25 percent (outpatient visits). Please refer to the 
attached slides for details. [See page 25.]
    [The slides referred to can be found in the Appendix on page 87.]
?

      
=======================================================================


              QUESTIONS SUBMITTED BY MEMBERS POST HEARING

                             April 29, 2009

=======================================================================

      
                   QUESTIONS SUBMITTED BY MRS. DAVIS

    Mrs. Davis. Under what authority has the ASD(HA) dual-hatted 
himself (herself) as the Director of TMA?
    Ms. Embrey. The Under Secretary of Defense (Personnel & Readiness) 
(USD(P&R)) is chartered under Department of Defense Directive (DoDD) 
5124.02, dated June 23, 2008, as the Principal Staff Advisor to the 
Secretary of Defense for, among other responsibilities, health affairs. 
In this capacity, the USD(P&R) exercises authority over the Assistant 
Secretary of Defense (Health Affairs) (ASD(HA)) and develops policies, 
plans, and programs for health and medical affairs. The USD(P&R) is 
charged to ``ensure that P&R policies and programs are designed and 
managed to improve standards of performance, economy, and efficiency, 
and that all Defense Agencies and DoD Field Activities under the 
authority, direction, and control of the USD(P&R) are attentive and 
responsive to the requirements of their organizational customers, both 
internal and external to the Department of Defense (DoD).''
    The ASD(HA) is chartered under DoDD 5136.01, dated June 4, 2008, as 
the principal advisor to the Secretary of Defense and the USD(P&R) for 
all DoD health policies, programs, and force health protection 
activities. The ASD(HA) is charged to ensure the effective execution of 
the Department's medical mission, providing and maintaining readiness 
for medical services and support. The ASD(HA) exercises authority, 
direction, and control over the DoD medical and dental personnel 
authorizations and policy, facilities, programs, funding, and other 
resources in DoD. In this regard, the ASD(HA) serves as program manager 
for all DoD health and medical resources, and prepares and submits the 
DoD Unified Medical Program budget to provide resources for the 
Military Health System.
    The TRICARE Management Activity (TMA) was established through 
Defense Reform Initiative Directive #14, signed on January 5, 1998 by 
then-Deputy Secretary of Defense Hamre. TMA is a field operating 
activity operating under the direction of the USD(P&R). Per DoDD 
5136.12, the mission of TMA is to (1) manage TRICARE; (2) manage and 
execute the Defense Health Program (DHP) Appropriation and the DoD 
Unified Medical Program; and (3) support the Uniformed Services in 
implementation of the TRICARE Program.
    The Unified Medical Program has grown at an increasing rate over 
the past decade due to a number of factors, to include medical 
inflation, increased number of users, enhanced benefits, and addition 
of benefits for the over-65 population. The Military Health System 
leadership has sought ways to ensure movement toward integrated health 
care delivery during this period of increasing system complexity (i.e., 
better integration among OSD policy, TRICARE health plan management and 
contract oversight, and the Services' health care delivery operations). 
In 2002, the USD(P&R) in concert with the ASD(HA) made a management 
decision to flatten the senior management layer of Health Affairs and 
the TRICARE Management Activity by designating the ASD(HA) with the 
additional responsibility of Director, TMA. This action is consistent 
with exercising the responsibilities outlined in DoDD 5124.02 and DoDD 
5136.01, enabling singular leadership focus on ensuring health policy 
and health plan operations operate in a congruent manner.
    Mrs. Davis. The jobs/functions of the Assistant Secretary of 
Defense for Health Affairs and Director of the TRICARE Management 
Activity (TMA) seem to be different. How are you able to maintain 
separate accounting of these distinct functions? When the TMA was 
created, wasn't there a separate Director? Did that not work?
    Ms. Embrey. TMA was formed under Defense Reform Initiative 
Directive #14, January 5, 1998, from the consolidation of the TRICARE 
Support Office, the Defense Medical Programs Activity, and the 
integration of the health management programs previously located in the 
Office of the Assistant Secretary of Defense (Health Affairs)--
OASD(HA).
    The ASD(HA) is charged to execute the longitudinal array of the 
Department's medical mission, which is to provide and maintain 
readiness, to provide medical services and support to members of the 
Armed Forces during military operations, and provide medical services 
and support to members of the Armed Forces, their dependents, and 
others entitled to DoD medical care. These ASD(HA) duties range from 
policy formulation to serving as the program manager for TRICARE health 
and medical resources, supervising and administering TRICARE programs, 
funding, and other resources within the Department of Defense.
    The Military Health System (MHS) leadership's goals include further 
integration between the direct care setting (predominantly Army, Navy, 
and Air Force military treatment facilities) and the purchased care 
component as the model for health care delivery in the Department of 
Defense. To effect this continued transition and better integrate MHS 
components, the ASD(HA), upon consultation with the USD(P&R), accepted 
the additional responsibility of Director, TMA in 2002, to exercise 
more direct control in addressing system-wide policy and operational 
issues inherent in managing a complex and expanding Unified Medical 
Program. Thus, the ASD(HA), who also serves as Director, TMA, brings 
together policy and operational issues in planning at the Department 
level. The Deputy Director, TMA oversees the day-to-day management 
activities of TMA (notably, guiding the health plan and purchased care 
component of the MHS). In doing so, the Director and the Deputy 
Director, TMA work in concert to administer DoD medical and dental 
programs authorized under Title 10, and oversee program direction for 
the execution of policy within the MHS.
    Mrs. Davis. How many more SESs are needed in HA? Why are they 
needed? How many more are needed in TMA and why?
    Ms. Embrey. Senior Executive Service (SES) employees provide the 
top level executive leadership in the Department of Defense. This 
leadership is imperative within Personnel and Readiness, Health 
Affairs, and TRICARE Management Activity (TMA) to manage the 
Department's dynamic $47 billion Unified Medical Program and to 
effectively interface within the Office of the Secretary of Defense 
(OSD), and with the Joint Staff and Service senior officials (noncareer 
appointees, SESs, and General/Flag Officers). At the same time, we 
remain cognizant that SES requirements are greater than existing SES 
resources; thus, it is imperative that leadership within the Department 
continue their efforts to balance competing needs for these valuable 
resources.
    Specifically related to HA and TMA requirements, Section 717 of the 
National Defense Authorization Act for Fiscal Year 2006 established the 
qualifications for the three CONUS TRICARE Regional Office Directors as 
Flag Officers or SESs; accordingly, we have recently added permanent 
SES leadership to two of the three TRICARE Regions (South and North, 
with a Flag Officer serving in the West). Additionally, to manage the 
complex MHS portfolio, we have identified a future requirement for four 
additional SES positions in Health Affairs and one additional SES 
position in the TMA.

    Health Affairs:

    1.  Deputy Chief, Clinical and Program Policy Integration--this 
position would work for the noncareer Deputy Assistant Secretary for 
Clinical and Program Policy as a career Senior Medical Officer, 
providing policy and oversight for direct and purchased care systems 
and all other functions.

    2.  Deputy Director, Force Health Protection and Readiness--this 
position would work under the Deputy Assistant Secretary of Defense for 
Force Health Protection, providing policy and oversight for research, 
vaccine, surveillance, surveys, deployment assessments, and 
epidemiology

    3.  Deputy Director, Medical RDT&E--this position would work for 
the Deputy Assistant Secretary of Defense for Force Health Protection, 
providing policy and oversight to annual $3 billion medical research 
program.

    4.  Chief, Health Program Communication and External Affairs--this 
position would integrate the interagency and communications portfolio 
to ensure consistency of messaging and unified effort within the 
interagency efforts (e.g., VA/DoD Program Office), with Congress, and 
with other external audiences.

    TRICARE Management Activity

    1.  Deputy CIO for Operations and Electronic Health Record (EHR)--
this position would direct requirements for development and integration 
of programs for $1B annual medical EHR efforts across the MHS, 
supporting all Military Services and health care delivery to our 9.4 
million beneficiaries.

    Mrs. Davis. There is some perception of the fox watching the 
henhouse. Do you think this structure could lead to lack of strong 
oversight, when the policy making staff in turn executes the policies? 
How is this conflict prevented?
    Ms. Embrey. In 2002, the Under Secretary of Defense (Personnel & 
Readiness) and the Assistant Secretary of Defense (Health Affairs) 
leveraged the Assistant Secretary's authority to ensure effective 
execution of the Department's medical mission, consistent with 
Department of Defense Directive 5136.01, through the management 
decision to provide additional responsibilities to key Health Affairs 
leaders. This action ensured alignment of policy and program execution 
strategies with a focus on enhanced support to the Military 
Departments. The ``dual hatted'' positions are: 1) the Assistant 
Secretary of Defense (Health Affairs) is also the Director, TRICARE 
Management Activity (TMA); 2) the Principal Deputy Assistant Secretary 
of Defense (Health Affairs) is also the Principal Deputy Director of 
TMA; and 3) each Deputy Assistant Secretary of Defense (DASD) is also a 
TMA Functional Chief to manage execution of related support programs 
and services to the Military Departments (Chief Medical Officer, Chief 
Financial Officer, and Chief of Force Health Protection and Readiness 
Programs).
    This is not a case of the ``fox watching the henhouse.'' In their 
Health Affairs roles, the DASDs are policy developers, whereas in their 
TMA roles, these same Functional Chiefs, who have separate staffs, 
serve the entire Military Health System as implementers. This is 
similar to the Service Surgeons General who have health care policy and 
execution roles (for example, the Army Surgeon General also serves as 
Commander, Army Medical Command).
    The Health Affairs/TMA positions continue to perform in a dual 
DASD-Functional Chief status and are a very efficient way to ensure new 
policies and programs are supported and executed in a timely manner. 
This role complements the Military Departments execution 
responsibilities as outlined in Title 10, United States Code.
    To prevent the ``fox watching the henhouse,'' the Military Health 
System employs an inclusive oversight processes. This governance 
structure enables enterprise-wide deliberations of key issues. 
Governance follows the tenets of a March 2006 Assistant Secretary of 
Defense (Health Affairs) memorandum, ``Policy on Military Health System 
Decision Making Process.'' The Services' Surgeons General were involved 
in the development of this oversight process. Health Affairs, TMA, and 
the Services' Surgeons General and their staffs engage from the subject 
matter expert level to the level of the senior principals through 
weekly Integrating Councils and the Senior Military Medical Advisory 
Council.
    Mrs. Davis. Has the Department of Defense Inspector General looked 
into this organizational structure?
    Ms. Embrey. The Department of Defense Inspector General has not 
looked into this organizational structure.
    Mrs. Davis. The OSD staff, of which the OASD(HA) is a part, is 
funded by a separate appropriation from TMA, which is funded by the 
Defense Health Program (DHP). It appears that this dual-hatting 
relationship could result in the augmentation of the OSD appropriations 
by the DHP. I understand TMA provides office space, contract support, 
people, video equipment, gym membership, Blackberries, conference 
support with meals, cell phones, etc. to HA. Is that true? What legal 
authorities have been consulted to allow this? I understand the ASD(HA) 
requested the appropriations committees expand the use of the DHP for 
purposes other than health care for uniform personnel and their 
families and retirees: An example cited last year was the need for the 
DHP to pay for HA administrative support items. This year it is for 
humanitarian and other reasons. Can you explain the rationale for this?
    Ms. Embrey. The Department remains vigilant about the issue you 
have raised regarding the dual-hatting relationship and the need to 
ensure that there is no augmentation of funds. The Department reviews 
all appropriations made which involve the dual-hatted function to 
ensure the funding supports the Chapter 55 of Title 10 (Defense Health 
Program--DHP) mission and is in accordance with appropriations law. 
When a question is identified, we consult with the TRICARE Management 
Activity and DoD Offices of General Counsel as appropriate.
    Recently, we have been doing an in depth review of all activities 
involving dual-hatting to ensure that any existing errors are corrected 
and prevented from occurring in the future. For instance, we completed 
a review of all cell phones and Blackberries and any that were not 
clearly for dual-hatted personnel are now funded with OSD 
appropriations. Additionally, we have been carefully reviewing 
conferences (including meals) to ensure that the funds expended are 
consistent with the mission of the DHP. With regard to contract 
personnel support, only those that directly support the DHP mission are 
funded with DHP dollars. While some of these are housed in OSD funded 
space, the rationale is to co-locate these personnel with the dual-
hatted individual whom they support. We also recently reviewed the 
contract for gym membership and determined that it would be more 
appropriate for HA staff (non dual-hatted) to be funded with OSD 
dollars.
    With regard to the question about expanding the use of the DHP--we 
have attempted to identify programs that are consistent with, and 
supportive of, larger departmental initiatives where we believe the DHP 
may have a role. However, we would only expend funds for these 
additional missions with Congressional approval.
    The Department agrees that the dual-hatting does require extra 
vigilance to ensure that there is no augmentation of funds. However, 
the intent behind the dual-hatting is sound and has provided for a 
strong and consistent connection between policy and operations as 
intended.
    Mrs. Davis. Please explain the differences between the Principal 
Deputy Director of TMA and the Deputy Director of TMA? These two 
positions seem redundant.
    Ms. Embrey. These two positions have distinct executive level roles 
and responsibilities. Consistent with the Assistant Secretary of 
Defense (Health Affairs)--ASD(HA)--who carries the additional 
responsibility of Director, TRICARE Management Activity (TMA), the 
Principal Deputy Assistant Secretary of Defense (HA)--PDASD(HA)--also 
carries the additional responsibility of Principal Deputy Director, 
TMA--PDD(TMA). In this capacity, the PDD(TMA) performs the role of 
Chief Operating Officer of the Military Health System Headquarters, 
assisting the ASD(HA)/Director, TMA in all matters. The PDD(TMA) 
assists the ASD(HA)/Director, TMA in fulfilling responsibilities for 
the effective execution of the Department's medical mission--to 
provide, and to maintain readiness to provide health services and 
support to members of the Armed Forces during military operations, and 
to provide health services and support to members of the Armed Forces, 
their family members, and others entitled to DoD health care. The 
PDD(TMA) may also discharge all duties in the absence of the ASD(HA), 
except those that qualify as ``statutory.'' To carry out this portfolio 
of duties in support of the HA mission, the PDD(TMA) participates as a 
member of executive level Military Health System committees (e.g., 
Senior Military Medical Oversight Committee) to assist in formulation 
of OASD(HA) policies.
    The PDD(TMA) has a specific portfolio of responsibilities related 
to interagency, planning, government relations, and communications 
activities. Specifically, the PDD(TMA) maintains the portfolio for 
external relationships with Congress, the Office of Management and 
Budget, Centers for Medicare and Medicaid Services, beneficiary 
organizations, and the media. All matters pertaining to the Department 
of Veterans Affairs are also coordinated through the PDD(TMA). The 
PDD(TMA) also has overall responsibility for strategic planning within 
the Office of the ASD(HA).
    The Deputy Director, TMA, serving under the Director, TMA, is the 
program executive for TRICARE health and medical resources. The Deputy 
Director is the principal advisor to the ASD(HA) on health plan 
management and Defense health contracting matters. The Deputy Director 
supervises and administers the TRICARE program and manages and executes 
the purchased care portion of the Defense Health Program consistent 
with guidance from the ASD(HA). The Deputy Director directs and manages 
daily operations of the TMA, to include oversight of the functioning of 
TMA divisions (for example, pharmacy operations, health plan 
operations), the three TRICARE Regional Offices in the Continental 
United States, and TRICARE Area Offices outside the Continental United 
States.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MR. WILSON
    Mr. Wilson. General Schoomaker, Admiral Robinson and General 
Roudebush: In each of your witness statements you express your concern 
regarding the blurring of the line between Health Affairs (HA) and the 
TRICARE Management Activity (TMA) or in other words policy and 
execution. What are some examples of how the current structure affects 
your ability to execute the responsibilities given to you by your 
service leadership and meet customer expectation?
    General Schoomaker. Health Affairs (HA) is best suited as a policy-
making organization providing oversight, leadership, and policy 
integration to the Service Medical Departments and the TRICARE 
Management Activity (TMA). HA has been increasingly assuming roles and 
responsibilities that are more suited to the operational or execution 
level. I am concerned that this trend will diminish the roles of the 
Services and the viability of the direct care system. I offer the 
following examples:

    EXAMPLE #1--The Defense Centers of Excellence for Psychological 
Health (PH) and Traumatic Brain Injury (TBI). Funds for TBI/PH programs 
were appropriated in 2007 at which time TMA established a ``Red Cell'' 
to establish a program and approve Service requests for funding. This 
limited the Services' flexibility to react to changing requirements and 
created extensive delays in our ability to execute. As a result, the 
majority of the funding was not executed until nearly 15 months after 
being appropriated. Congress has directed the establishment of other 
Centers of Excellence such as for Hearing and for Vision. 
Responsibility for executing these Centers of Excellence has thus far 
remained with HA, but I believe execution would be managed more 
appropriately by one of the Services.

    EXAMPLE #2--Military Health System Support Initiatives (MHSSI) 
program. TMA established this program to enable Military Treatment 
Facilities (MTFs) to obtain private sector care funding to invest in 
direct care initiatives that generate savings in the private sector. 
The program requires MTFs to provide detailed business cases and 
extensive justification to TMA and the TRICARE Regional Offices for 
relatively small amounts of funding. MTF commanders do not have the 
authority to move funding between direct and private sector to meet the 
needs of their market.

    EXAMPLE #3--American Recovery and Reinvestment Act (ARRA) Funding. 
The Army was to receive $220M from the ARRA for medical facility 
renovation and modernization. TMA assumed centralized management of 
these projects and funding rather than allowing the Services to use 
their established processes with the Corps of Engineers. This 
centralized management has caused delays--Army projects that were ready 
to be funded in April remain unfunded.

    Admiral Robinson. The structure of the Military Health System, 
comprised of HA, TMA, and the Services, can be cumbersome. The 
structure generates tension as parties struggle to balance the support 
of the operational forces and the operation of an integrated health 
care system that provides patient and family-centered health care to 
beneficiaries both within Medical Treatment Facilities (MTFs) and the 
Managed Care Support Contractor (MCSC) network. The ability of the 
Services to influence this balancing act is somewhat limited since HA/
TMA controls the majority of the funding and how it is allocated. While 
HA/TMA leads in policy development and execution, the Services are 
ultimately accountable to ensure the needs of their beneficiaries are 
met and that personnel are ready to deploy.
    The challenges presented by the current structure are evident at 
the local and regional levels of health care delivery. While Navy 
Medicine is ultimately responsible to ensure that all our beneficiaries 
receive safe, effective and accessible care, our MTF Commanders/
Commanding Officers have a specific responsibility for the 
beneficiaries enrolled to their MTFs and for ensuring the continuity of 
their care as they receive health care services both within the MTF and 
within the MCSC network. However, MTF Commanders/Commanding Officers 
have no direct command and control over the actions or performance of 
the MCSC at the local level that would enhance their ability to operate 
an integrated health care system. The MCSCs answer to TMA via its 
TRICARE Regional Offices. For example, the lack of a referral 
management process that includes the Services, for care provided by the 
MCSCs, shifts tremendous amounts of workload to MTFs as they attempt to 
obtain consult results generated by network providers.
    These challenges are also manifest in the health information 
management systems that are funded, designed, developed, and maintained 
by HA/TMA. These systems have consistently been plagued by performance 
and technical shortcomings. Issues have not been resolved in a timely 
manner or on an agreed upon schedule. Products are either not delivered 
at all, delivered years late, delivered with multiple defects, or 
delivered incomplete. This often requires that Navy Medicine develop 
interim solutions by expending its own resources, both time and money, 
because many issues simply cannot wait for an adequate solution to be 
provided by HA/TMA. Additionally, HA/TMA has failed to recognize the 
need for decision support tools in areas such as patient and staff 
scheduling, discharge management, patient and room management, and the 
implementation of evidence-based practice. Future system development 
needs to more heavily engage the Services who will actually utilize 
these products in their MTFs and ensure that systems are developed and 
deployed with the needed expertise, an in modern, flexible electronic 
architecture.
    Challenges also exist in the area of performance measurement, as 
HA/TMA metrics are insufficient to measure the cost, quality, and 
effectiveness of the care provided to our beneficiaries, whether in the 
private sector or the direct care system.
    Current HA/TMA policy and management, as it relates to facility 
planning, does not result in facility projects that meet the future 
needs of our system. Current policy is based on historical workload and 
assumes that the care provided was appropriate, effective, and 
efficient.
    HA/TMA has not met the health services research needs of Navy 
Medicine. While HA/TMA is well positioned to implement a health 
services research program that would improve the effectiveness of the 
care provided by Navy Medicine and the military health system as a 
whole, it has not done so.
    Lastly, HA/TMA's current approach to financial management does not 
meet the needs of Navy Medicine. The current budget allocation process, 
the Prospective Payment System, misaligns financial resources and 
creates incentives for the over-utilization of health services. The 
cost accounting system, Medical Expense & Performance Reporting System, 
fails to help managers understand whether health care resources are 
being appropriately utilized. The current budget process, based on 
annual appropriations, also creates a cumbersome, inefficient means for 
financing a health care entitlement program.
    General Roudebush. As I stated in my recent testimony, the current 
structure of HA is generally conducive to its role in developing 
policies, crafting strategic plans, aligning financial plans, and 
integrating Military Health System (MHS) functions to create 
synergistic effects. Our concern continues to be with the growth in HA 
and Deputy Assistant Secretary of Defense (DASD-HA) ``dual-hat'' 
responsibilities to include oversight of selected execution activities 
within TMA and the broadened TMA role in budget execution oversight of 
Military Treatment Facility (MTF) Business Plans and Readiness. We 
believe this broadened role has distracted TMA from the mission of 
managing the cost growth in Private Sector Care (PSC). Some examples of 
how TMA's current organizational structure impact Service Title X 
responsibilities include:

    EXAMPLE #1: Approximately 5 years ago, TMA implemented the 
Prospective Payment System (PPS) which directs a performance-based 
budgeting system to incentivize MTF efficiencies. PPS is intended to 
provide military treatment facilities budgets based on actual direct 
care workload produced such as hospital admissions, prescriptions 
filled, and clinic visits instead of historic resources levels. For 
each service to be successful in PPS, the military treatment facilities 
must adopt a workload based or ``fee for service'' approach to 
healthcare versus one that focuses on medical outcomes and improving 
patients' health. Also, PPS does not complement how resources are 
appropriated since ``incentive'' funds may be redistributed 8 months 
after the fact.

    EXAMPLE #2: HA/TMA issuance of operational guidance to MTFs without 
complete coordination with the Services and other DoD agencies. An 
example is authorizing the use of Defense Health Program funds from PSC 
dollars for civilian care rendered to active duty members within a 
theater of operations rather than using GWOT/Overseas Contingency 
Operations funds. This involvement by HA/TMA and lack of complete 
coordination diminishes the role of the Services and the viability of 
the Direct Care System.

    EXAMPLE #3: From a systems perspective, TMA's organizational 
construct has increased the potential for duplication of effort. 
Specifically, an example is TMA's decision to remove funding from 
AHLTA's (DoD's Electronic Health Record) inpatient functionality 
without an interim or long-term solution. As a result of these 
decisions, the Air Force Medical Service and other Services had to pull 
funds from existing priorities within the Direct Care System to pay for 
a solution.

    In conclusion, we believe HA/TMA can be organized to effectively 
address MHS policy issues and strategic direction. Additionally, the 
focus of TMA should be on reducing PSC cost growth and managing the 
TRICARE Health Plan. Thank you for the opportunity to provide our 
Service perspective.
    Mr. Wilson. In your discussion of a human capital management 
strategy your testimony states ``Having a one-size-fits-each-service 
policy is too constrictive...'' What do you mean by that statement? 
What are examples of the policy being too constrictive?
    General Schoomaker. The Assistant Secretary of Defense for Health 
Affairs (ASD-HA) controls all health professions special pays within 
the Department. Incentive and retention pay is established with 
``Service consent'' by a majority vote. These pays are equivalent 
across Services with only a few variations. Each Service has the 
opportunity to implement or not implement a specific bonus package, but 
we do not have the ability to change it. As such, any time we identify 
a needed change, we must seek concurrence with all the Services.
    For accession pay, ASD-HA allows the Services latitude by 
establishing a cap and giving the Services flexibility within that cap. 
Under the new consolidation of special pay authorized in the 2008 
National Defense Authorization Act, Health Affairs still directs what 
will happen--the Services have no authority.
    Ultimately, I would like the ability to customize bonus packages to 
meet the needs of the recipient. Our competitors in the civilian market 
can offer financial, education, reimbursements, and other forms of 
compensation to suit each need. The Department is currently limited to 
financial compensation only.
    Mr. Wilson. In your written testimony you indicate that the 
Department is considering some minor adjustments of personnel reporting 
relationships within TMA. In November 2006, the then Deputy Secretary 
of Defense Gordon England directed the Military Health System to 
reorganize. In August 2008, Dr. Casscells directed another 
reorganization effective October 1, 2008. What is the purpose of all of 
these reorganizations? Please describe the adjustments you plan to make 
in detail. Why is it necessary to make these adjustments now?
    Ms. Embrey. Prior to his departure, the former Assistant Secretary 
of Defense (Health Affairs)--ASD(HA)--signed but did not issue a 
memorandum, which when implemented, would have formally realigned 
certain functions into the portfolio of the Principal Deputy Assistant 
Secretary of Defense (Health Affairs)--PDASD(HA)--who also serves as 
the Principal Deputy Director, TRICARE Management Activity--PDD(TMA). 
These functions are: Program Integration, Office of Strategy 
Management, Military Health System (MHS) Strategic Communications, and 
DoD/VA Program Coordination Office. The realignment was intended to 
align functions and staff to achieve unity of effort and consistency of 
message.
    Whereas these functions are within the manning structure of TMA, 
they perform the essential role enabling the ASD(HA) to set a strategic 
direction for the MHS, engage in the interagency arena and with 
Congress, and ensure consistent messaging internally and externally. 
Thus, aligning these functions into the portfolio of the PDASD(HA)/
PDD(TMA) would have strengthened the ability of the ASD(HA)/Director, 
TMA to present a unified voice for the MHS and Unified Medical Program.
    That notwithstanding, I reassessed the appropriateness of this 
action's timing and subsequently rescinded the memorandum signed by the 
former ASD(HA). Realignment decisions will be deferred until a new 
Under Secretary of Defense for Personnel & Readiness and a new ASD(HA) 
are confirmed, and have the opportunity to assess the issue and to 
consider alternative courses of action.

                                  
