[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



                                     

                         [H.A.S.C. No. 112-120]

 
                                HEARING
                                   ON
                   NATIONAL DEFENSE AUTHORIZATION ACT
                          FOR FISCAL YEAR 2013
                                  AND
              OVERSIGHT OF PREVIOUSLY AUTHORIZED PROGRAMS

                               BEFORE THE

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

               SUBCOMMITTEE ON MILITARY PERSONNEL HEARING

                                   ON

                         DEFENSE HEALTH PROGRAM

                            BUDGET OVERVIEW

                               __________

                              HEARING HELD
                             MARCH 21, 2012


                                     
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                   SUBCOMMITTEE ON MILITARY PERSONNEL

                  JOE WILSON, South Carolina, Chairman
WALTER B. JONES, North Carolina      SUSAN A. DAVIS, California
MIKE COFFMAN, Colorado               ROBERT A. BRADY, Pennsylvania
TOM ROONEY, Florida                  MADELEINE Z. BORDALLO, Guam
JOE HECK, Nevada                     DAVE LOEBSACK, Iowa
ALLEN B. WEST, Florida               NIKI TSONGAS, Massachusetts
AUSTIN SCOTT, Georgia                CHELLIE PINGREE, Maine
VICKY HARTZLER, Missouri
               Jeanette James, Professional Staff Member
                 Debra Wada, Professional Staff Member
                      James Weiss, Staff Assistant


                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2012

                                                                   Page

Hearing:

Wednesday, March 21, 2012, Defense Health Program Budget Overview     1

Appendix:

Wednesday, March 21, 2012........................................    23
                              ----------                              

                       WEDNESDAY, MARCH 21, 2012
                 DEFENSE HEALTH PROGRAM BUDGET OVERVIEW
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

Davis, Hon. Susan A., a Representative from California, Ranking 
  Member, Subcommittee on Military Personnel.....................     2
Wilson, Hon. Joe, a Representative from South Carolina, Chairman, 
  Subcommittee on Military Personnel.............................     1

                               WITNESSES

Green, Lt Gen Charles B., USAF, Surgeon General, U.S. Air Force..    10
Horoho, LTG Patricia D., USA, Surgeon General, U.S. Army.........     5
Nathan, VADM Matthew L., USN, Surgeon General, U.S. Navy.........     7
Strobridge, Col Steve, USAF (Ret.), Co-Chair, The Military 
  Coalition......................................................    11
Woodson, Hon. Jonathan, M.D., Assistant Secretary of Defense for 
  Health Affairs, U.S. Department of Defense.....................     4

                                APPENDIX

Prepared Statements:

    Davis, Hon. Susan A..........................................    28
    Green, Lt Gen Charles B......................................   109
    Horoho, LTG Patricia D.......................................    55
    Nathan, VADM Matthew L.......................................    83
    Strobridge, Col Steve........................................   129
    Wilson, Hon. Joe.............................................    27
    Woodson, Hon. Jonathan.......................................    29

Documents Submitted for the Record:

    Statement of the National Military Family Association........   169
    Statement of the Reserve Officers Association of the United 
      States and the Reserve Enlisted Association................   161
    Statement of The Military Coalition..........................   196

Witness Responses to Questions Asked During the Hearing:

    Dr. Heck.....................................................   223

Questions Submitted by Members Post Hearing:

    Ms. Bordallo.................................................   237
    Mrs. Davis...................................................   227
    Mr. Jones....................................................   237
    Mr. Loebsack.................................................   241
                 DEFENSE HEALTH PROGRAM BUDGET OVERVIEW

                              ----------                              

                  House of Representatives,
                       Committee on Armed Services,
                        Subcommittee on Military Personnel,
                         Washington, DC, Wednesday, March 21, 2012.
    The subcommittee met, pursuant to call, at 3:10 p.m. in 
room 2212, Rayburn House Office Building, Hon. Joe Wilson 
(chairman of the subcommittee) presiding.

  OPENING STATEMENT OF HON. JOE WILSON, A REPRESENTATIVE FROM 
  SOUTH CAROLINA, CHAIRMAN, SUBCOMMITTEE ON MILITARY PERSONNEL

    Mr. Wilson. Ladies and gentlemen, good afternoon. I would 
like to welcome you to a meeting of the Military Personnel 
Subcommittee. This will be a hearing on the Defense Health 
Program budget overview. And I want to thank people for 
attending today and certainly thank our witnesses.
    Today the subcommittee meets to hear testimony on the 
Defense Health Program for fiscal year 2013. I would like to 
begin by acknowledging the remarkable military and civilian 
medical professionals who provide extraordinary care to our 
service members and their families and veterans here at home 
and around the world, often in some of the toughest and most 
austere environments. I have firsthand knowledge of their 
dedication and sacrifice from my son, Addison, who is an 
orthopedic resident in the Navy and who has served in Iraq.
    Even in this tight fiscal environment, the Military Health 
System must continue to provide world-class health care to 
beneficiaries and remain strong and viable and fully funded in 
order to maintain that commitment. The Department of Defense 
has proposed several measures aimed at reducing the cost of the 
Defense Health Program. Unfortunately, all of the proposals 
simply shift the cost burden to TRICARE fee and cost-share 
increases to not only our working-age retirees but, for the 
first time, to our most senior military retirees.
    The subcommittee has a number of concerns about the 
Department's initiatives. To that end, we would expect the 
Department's witnesses to address our concerns, including that: 
first, the proposed TRICARE Prime fee increases, which have 
been characterized by military leaders as modest, will raise 
fees in fiscal year 2013 by 30 to 78 percent over the current 
rate. Over 5 years, the fees would increase by 94 to 345 
percent.
    The proposed increases may be designed to cause military 
retirees to opt out of TRICARE, choose a TRICARE option that is 
less costly to DOD, or decrease their use of TRICARE. The 
proposal would establish an annual enrollment fee for retirees 
who use TRICARE Standard and Extra and, for the first time, 
would require our most senior retirees to pay an enrollment fee 
for TRICARE For Life.
    What is not clear to me is why, aside from the revenue 
being generated from the fees, DOD believes enrolling these 
participants is necessary. What benefit can these individuals 
expect to receive from enrolling?
    And, finally, 60 percent of the estimated cost savings from 
TRICARE proposals is based on military retirees opting out of 
TRICARE or using it less. Frankly, I think this plan is 
wrongheaded.
    Finally, I would like to hear from the military surgeons 
about efforts they are taking within the military departments 
to increase the efficiency of the military healthcare system 
and reduce cost. I would also like the military surgeons' views 
on areas where additional efficiencies can be gained across the 
DOD health system. I hope our witnesses will address these 
important issues as directly as possible in their oral 
statements and in response to Member questions.
    Before I introduce our panel, let me offer Ranking Member 
Susan Davis of California an opportunity to make her opening 
remarks.
    [The prepared statement of Mr. Wilson can be found in the 
Appendix on page 27.]

    STATEMENT OF HON. SUSAN A. DAVIS, A REPRESENTATIVE FROM 
 CALIFORNIA, RANKING MEMBER, SUBCOMMITTEE ON MILITARY PERSONNEL

    Mrs. Davis. Thank you, Mr. Chairman.
    I look forward, as well, to hearing from Assistant 
Secretary Woodson on his views on the status of the military 
healthcare system, particularly the TRICARE system, and the 
Department's efforts to improve the care that we are providing 
to our service men and women, retiree survivors, and their 
families.
    I am also looking forward to hearing from our Surgeon 
General, General Green. Welcome back, and thank you for your 
service.
    Admiral Nathan and General Horoho, welcome. I believe that 
this is your first testimony before the committee. We are happy 
to have you. Thank you for your service. I know that you will 
continue the laudable efforts of your predecessors.
    And, finally, Mr. Strobridge from The Military Coalition, 
welcome. We appreciate your joining us to share your views, as 
well.
    The last decade of conflict has been weathered on the backs 
of our remarkable forces, in particular those who serve in our 
military healthcare system. The constant demands borne by those 
in uniform and those in support of them have yielded incredible 
successes on our battlefields--our battlefields abroad and at 
home here in the States.
    While I suspect that much of this hearing will focus on the 
healthcare proposals of the Department of Defense, this hearing 
should also provide the members of the subcommittee an 
opportunity to understand and to examine some of the difficult 
challenges facing the military healthcare system, from our 
reductions in resources to meeting the ever-increasing demand 
for mental health services.
    Our military personnel and their families consistently 
exceed expectations under tremendous strains and pressures. And 
their access to quality health care should not be added to 
their plights. I look forward to your testimony on how we are 
caring for our service members and their families, particularly 
our injured, ill, and wounded, and how we can continue to 
improve our healthcare system in the new fiscal environment 
that we will be facing.
    Thank you all.
    Thank you, Mr. Chairman.
    [The prepared statement of Mrs. Davis can be found in the 
Appendix on page 28.]
    Mr. Wilson. Thank you, Ms. Davis.
    We have five witnesses today. We would like to give each 
witness the opportunity to present his or her testimony and 
each Member an opportunity to question the witnesses. I would 
respectfully remind the witnesses that we desire you to 
summarize to the greatest extent possible the high points of 
your written testimony into 3 minutes. I assure you your 
written comments and statements will be made part of the 
hearing record.
    At this time, without objection, I ask unanimous consent 
that additional statements from the Reserve Officers 
Association, the National Military Family Association, and The 
Military Coalition would be included in the record of this 
hearing.
    Without objection, so ordered.
    [The information referred to can be found in the Appendix 
on pages 161, 169, and 196, respectively.]
    Mr. Wilson. Let me welcome the panel.
    Welcome back, Dr. Jonathan Woodson--thank you--as Assistant 
Secretary of Defense for Health Affairs. And we have Lieutenant 
General Patricia D. Horoho, the Surgeon General of the 
Department of the Army--thank you for being here; and Vice 
Admiral Matthew L. Nathan, Surgeon General, Department of the 
Navy; and Lieutenant General Charles Bruce Green, Surgeon 
General, Department of the Air Force; and Colonel (Ret.) Steve 
Strobridge, co-chairman, The Military Coalition.
    Before we begin, I would like to recognize General Horoho 
and Admiral Nathan and extend a special welcome to them, as 
this is their first appearance before the subcommittee since 
becoming Surgeon Generals. Congratulations to both of you.
    And I want to join with a fellow nurse of General Horoho, 
and that is Jeanette James. She is so excited, rightfully so, 
of you being the first nurse to serve as Surgeon General. So 
congratulations, and I am very proud for you.
    General Green, I understand you are retiring--at an early 
age--this summer, so this may be your last DHP [Defense Health 
Program] hearing. Your leadership has been instrumental in the 
tremendous advances made in the aeromedical evacuation system 
that is key to the extraordinary survival rate of our wounded 
and injured around the world. Thank you, and best of luck to 
you.
    I also want to announce that, to ensure that Members have 
an opportunity to question our witnesses, we will use the 5-
minute rule when recognizing Members for questions.
    And we will now begin with the testimony from the 
witnesses. And we have Jeanette James keeping the time, and she 
is above reproach. So when she says time is up, we will all 
follow through. So thank you so much.
    Dr. Woodson.

 STATEMENT OF HON. JONATHAN WOODSON, M.D., ASSISTANT SECRETARY 
   OF DEFENSE FOR HEALTH AFFAIRS, U.S. DEPARTMENT OF DEFENSE

    Secretary Woodson. Thank you, Mr. Chairman, Ranking Member 
Davis, members of the committee. Thank you for the opportunity 
to appear before you today to discuss the future of the 
Military Health System, in particular our priorities for this 
coming year.
    Over the last 10 years, the men and women serving in the 
Military Health System have performed with great skill and 
undeniable courage in combat. Their contributions to advancing 
military and American medicine are immense. The Military Health 
System's ability to perform this mission and be able to respond 
to humanitarian crises around the world is unique among all 
military and non-military organizations on this globe, and I am 
committed to sustaining this indispensable instrument of 
national security.
    One of the most critical elements of our strategy is to 
ensure the medical readiness of men and women in our Armed 
Forces. We are using every tool at our disposal to assess the 
service member's health before, during, and following 
deployment from combat theaters. And for those who return with 
injuries and illnesses, we continue to provide comprehensive 
treatment and rehabilitation services supported by medical 
research and development portfolios appropriately focused on 
the visible and invisible wounds of war.
    Concurrent with our mission of maintaining a medically 
ready force is our mission of maintaining a ready medical 
force. This ready-medical-force concept has many interdependent 
parts. It requires our entire medical team to be well trained. 
It requires development of our physicians in active accredited 
graduate medical education programs. It requires our military 
hospitals and clinics to be operating at near-optimal capacity. 
And for our beneficiaries, it requires an active decision to 
choose military medicine as their preferred source of care.
    To meet these readiness imperatives means we need to 
compete with the rest of American medicine to recruit and 
retain top talent, to provide state-of-the-art medical 
facilities that attract both patients and medical staff, and to 
sustain a high-quality care system.
    The budget we have proposed provides the resources we need 
to sustain the system. As we maintain our readiness, we must 
also be responsible stewards of the taxpayers' dollars. The 
2011 Budget Control Act required the Department to identify 
$487 billion in budget reductions over the next 10 years. 
Healthcare costs could not be exempt from this effort.
    The Military Health System is undertaking four simultaneous 
actions to reduce costs: one, internal efficiencies to better 
organize our decisionmaking and execution arm; two, a 
continuation of our efforts to appropriately pay providers in 
the private sector; three, initiatives that promote health, 
reduce illness, injury, and hospitalization; and four, proposed 
changes to the beneficiary cost-sharing under TRICARE.
    The military and civilian leaders in the Department 
developed these proposals and have publicly communicated their 
support for these proposals to you in writing and in person. I 
want to identify the core principles to which we adhered to in 
developing these proposals.
    We believe the TRICARE benefit has always been one of the 
most comprehensive and generous health benefits in our country, 
and our proposals keep it that way. In 1996, military retirees 
were responsible for about 27 percent of overall TRICARE costs. 
In 2012, the percentage share of costs borne by beneficiaries 
has dropped to a little over 10 percent of overall costs. If 
these proposals we put forward are accepted, beneficiary out-
of-pocket costs will rise to 14 percent of costs by 2017. This 
is about half of what beneficiaries experienced in 1996.
    Second, we have exempted the most vulnerable populations 
from our cost-sharing changes. Medically retired service 
members and the families of service members who died on Active 
Duty are both protected under this principle. Additionally, we 
have introduced cost-sharing tiers based upon retirement pay, 
reducing the increases for those with lower retirement pays. 
And this was uniform and line-led.
    Mr. Chairman, we recognize the concerns the members of the 
committee and the beneficiary organizations have voiced 
regarding these proposals. I want to emphasize that these 
proposals are targeted to mitigate the burden on any one 
particular group of beneficiaries while simultaneously meeting 
our congressionally mandated cost-saving responsibilities under 
the Budget Control Act.
    We have also recently submitted to Congress the Secretary's 
recommended path forward on how we reorganize the Military 
Health System. We have learned a great deal from our joint 
medical operations over the last 10 years, and we recognize 
that there is much opportunity for introducing even a more 
agile headquarters operation that shares services and 
institutes common business plans and clinical practices across 
our system of care.
    The budget we have put forward for 2013 is a responsible 
path forward to sustaining the Military Health System in a 
changing world and recognizes that the fiscal health of the 
country is a vital element in our national security. I am proud 
to be here with you today to represent the men and women who 
comprise the Military Health System, and I look forward to your 
questions.
    [The prepared statement of Secretary Woodson can be found 
in the Appendix on page 29.]
    Mr. Wilson. Thank you very much.
    And Dr. Horoho.

STATEMENT OF LTG PATRICIA D. HOROHO, USA, SURGEON GENERAL, U.S. 
                              ARMY

    General Horoho. Chairman Wilson, Ranking Member Davis, and 
distinguished members of the committee, thank you for providing 
me this opportunity to share with you today my thoughts on the 
future of Army Medicine and highlight some of the incredible 
work being performed by dedicated men and women, with whom I am 
honored to serve alongside.
    We are American's most trusted premier medical team, and 
our successful mission accomplishment over these past 10 years 
is testimony to the phenomenal resilience, dedication, and 
innovative spirit of soldier medics, civilians, and military 
families throughout the world.
    From July to October of 2011, I was privileged to serve as 
the International Security Assistance Force Joint Command's 
special assistant for health affairs. My multidisciplinary team 
of 14 military health professionals conducted an extensive 
evaluation of theater health service support to critically 
assess how well we were providing health care from the point of 
injury to evacuation from theater. It cannot be overstated that 
the best trauma care in the world resides with the U.S. 
military in Afghanistan and Iraq.
    The AMEDD [United States Army Medical Department] is 
focused on building upon these successes on the battlefield as 
we perform our mission at home and is further cementing our 
commitment to working as a combined team anywhere, anytime. We 
are at our best when we operate as part of the joint team, and 
we need to proactively develop synergy with our partners as 
military medicine moves toward a joint operating environment. 
Continuity of care and continuity of information are key to the 
delivery as DOD [Department of Defense] and the VA [Department 
of Veterans Affairs] team provides care.
    There are significant health-related consequences over the 
10 years of war, including behavioral health needs, post-
traumatic stress, intensive care of burns or disfiguring 
injuries, and chronic pain. A decade of war in Afghanistan and 
Iraq has led to tremendous advances in knowledge and care of 
combat-related physical and psychological problems. We have 
partnered with the Department of Veterans Affairs, the Defense 
and Veterans Brain Injury Center, and the Defense Centers of 
Excellence for Traumatic Brain Injury and Psychological Health 
in academia, as well as the National Football League, to 
improve our ability to diagnose, treat, and care for those 
affected by traumatic brain injury.
    Similar to our approach with concussive head injuries, Army 
Medicine has harvested the lessons of almost a decade of war 
and has approached the strengthening of our soldiers' and 
families' behavioral health and emotional resiliency through 
the comprehensive behavioral health system of care. It is a 
system of systems built around the need to support an Army 
engaged in repetitive deployments, often in intense combat, 
which then returns to home station to restore, reset the 
formation, and reestablish family and community bonds. The 
system is underpinned by the multiple touchpoints across the 
time, in which soldiers receive mandatory behavioral health 
assessments from pre-deployment to post-deployment and into 
garrison life.
    The warfighter does not stand alone in support of a nation 
in persistent conflict with the stresses resulting from 10 
years of war. Army Medicine has a responsibility to all those 
who serve, to include our family members and our retirees who 
have already answered the call to our Nation. We are committed 
to ensuring the right capabilities are available to promote 
health and wellness and are focused on decreasing variance, 
increasing standards and standardizations across Army Medicine.
    I am incredibly honored and proud to serve as the 43rd 
Surgeon General and the Army Commander of the U.S. Army Medical 
Command. There are miracles happening every day at our command 
outposts, forward operating bases, posts, camps, and stations 
every day because of the dedicated civilians and soldiers that 
make up the Army Medical Department.
    With the continued support of Congress, we will lead the 
Nation in health care and health, and our men and women in 
uniform will be ready when the Nation calls them to action. 
Army Medicine stands ready to accomplish any task in support of 
our warfighters and families.
    Thank you for the opportunity to talk with you today, and I 
look forward to your questions.
    [The prepared statement of General Horoho can be found in 
the Appendix on page 55.]
    Mr. Wilson. Thank you very much.
    And Admiral Nathan.

STATEMENT OF VADM MATTHEW L. NATHAN, USN, SURGEON GENERAL, U.S. 
                              NAVY

    Admiral Nathan. Thank you, Chairman Wilson, Ranking Member 
Davis, distinguished members of the subcommittee. I am pleased 
to be with you today to provide an update on Navy Medicine, 
including some of our collective strategic priorities, 
accomplishments, opportunities, and challenges.
    I want to thank the committee members for the tremendous 
confidence and support shown to Navy Medicine.
    I can report to you that Navy Medicine remains strong, 
capable, and mission-ready to deliver world-class care 
anywhere, anytime, as is our motto. The men and women of Navy 
Medicine are flexible; they are agile and resilient. They are 
meeting their operational and wartime commitments, including 
humanitarian assistance and disaster relief response, and 
concurrently delivering outstanding patient- and family-
centered care to our beneficiaries.
    Force health protection is what we do. And we do it at the 
very foundation of our continuum of care in support of the 
warfighter, and optimizes our ability to promote, protect, and 
restore their health.
    One of my top priorities as I assumed my role as Surgeon 
General in November has been to ensure that Navy Medicine 
remains strategically aligned with the imperatives and 
priorities of the Commandant of the Marine Corps and the Chief 
of Naval Operations. Each day, we are fully focused on 
executing the operational missions and core capabilities of the 
Navy and Marine Corps, and we do this by maintaining warfighter 
health readiness, delivering the continuum of care from the 
battlefield to the bedside and from the bedside either back to 
the unit, to the family, or to transition.
    We are honored to be entrusted with the health care of all 
we serve. We are aligned with our Navy and Marine Corps 
leadership as we support the defense strategic guidance, 
``Sustaining U.S. Global Leadership: Priorities for the 21st 
Century,'' issued by the President and Secretary of Defense 
earlier this year.
    The Chief of Naval Operations, in his sailing directions to 
us, has articulated the Navy's first principles, and these 
include: warfighting first, operate forward, be ready. Earlier 
this month, Secretary Mabus launched the 21st-Century Sailor 
and Marine Program, a new initiative focused on maximizing each 
sailor's and marine's personal readiness. This program includes 
comprehensive efforts in key areas such as reducing suicides, 
curbing alcohol abuse, and reinforcing zero tolerance on the 
use of designer drugs or synthetic chemical compounds. It also 
recognizes the vital role of safety and physical fitness in 
sustaining the force readiness.
    Navy Medicine is synchronized with those priorities and 
stands ready to move forward at this pivotal time in our 
history. We appreciate the committee's strong support of 
resource requirements. The President's budget for FY [fiscal 
year] 2013 adequately funds Navy Medicine to meet its medical 
mission for the Navy and Marine Corps. We recognize the 
significant investments made in supporting military medicine 
and providing a strong, equitable, and affordable healthcare 
benefit for beneficiaries.
    Moving forward, we must innovate, operate jointly, position 
our direct care system to recapture private-sector care, and 
deliver best value to our patients. Briefly, I will share with 
you a few specific areas of our attention.
    Combat casualty care: Navy Medicine, along with our Army 
and Air Force colleagues, are delivering outstanding combat 
casualty care. There is occasional discussion about what 
constitutes ``world-class,'' and I can assure you that the 
remarkable skills and capabilities in places like the Role 3, a 
multinational medical unit in Kandahar, is, in fact, world-
class trauma care, now even deploying MRI [magnetic resonance 
imaging] technology to investigate if this can be meaningful in 
changing the diagnosis and/or therapy in theater.
    Another area is TBI [traumatic brain injury] and PTSD 
[post-traumatic stress disorder]. Caring for our sailors and 
marines suffering with traumatic brain injury and post-
traumatic stress and/or PTSD remains a top priority. While we 
are making progress, we have much work ahead of us as we 
determine both the acute and the long-term impact on our 
service members. Military medicine cannot do this alone. We 
must continue active and expansive partnerships with the other 
services, our centers of excellence, the VA, and leading 
academic, medical, and private sectors. We wish to make the 
best care available to our warriors affected with TBI. I have 
been encouraged by our progress, but I am not yet satisfied.
    And, also, wounded warrior recovery: Our wounded, ill, and 
injured service members need to heal in body, mind, and spirit. 
And they deserve a seamless and comprehensive approach to their 
recover along that journey with their families. Moving forward, 
we must continue to connect our heroes to approved emerging and 
diagnostic therapeutic options, both within our medical 
treatment facilities and outside of military medicine through 
collaborations with major centers of reconstructive and 
regenerative medicine. Our commitment to these men and women 
will never waiver.
    And one last point on Medical Home Port, our adaptation of 
the successful civilian patient-centered medical home concept 
of care, which is transforming delivery of primary care across 
many managed care agencies in the country. We have completed 
our initial deployment of Medical Home Port throughout the Navy 
Medical Enterprise, and preliminary results in the first sites 
show better value, better health--preventative health, cost 
utilization of those enrolled.
    Also, our innovative research, including the critical 
overseas laboratories that not only provide world-class 
research but invaluable engagement with host and surrounding 
nations to strengthen theater security cooperation in places 
like Egypt, South America, Southeast Asia, along with excellent 
medical education and training programs ensure that we have the 
capabilities to deliver the state-of-the-art care now and in 
the future. They are truly force multipliers.
    We continue to welcome and leverage our joint relationships 
with the Army, the Air Force, the VA, as well as other Federal 
and civilian partners in these important areas. I believe this 
interoperability helps us create systemwide synergies and 
allows us to invest wisely in education, training, research, 
and information technology.
    None of these things would be possible without our 
dedicated workforce, a team of over 63,000 Active Component and 
Reserve Component personnel, Government civilians, as well as 
contract personnel, all working around the world to provide 
outstanding health care and support to their beneficiaries. I 
am continually inspired by their selfless service and sharp 
focus on protecting the health of sailors, marines, and their 
families. And I am particularly grateful for your support in 
helping us recruit and retain the best of these.
    In closing, let me briefly address the MHS [Military Health 
System] governance. We appreciate the opportunity to begin the 
dialogue with you a month ago, when there was a hearing held on 
this issue. The Deputy Secretary of Defense has submitted his 
report to Congress, required by Section 716 of the fiscal year 
2012 National Defense Authorization Act. It addresses the 
Department's plans, subject to review and concurrence by the 
GAO [Government Accountability Office], to move forward with 
governance changes.
    Throughout my remarks this morning and in my statement for 
the record, I referred to our jointness in theater, in our 
classrooms, our laboratories, and our common pursuit of 
solutions for challenges like TBI. I again stress our 
commitment to interoperability and cost-effective joint 
solutions in terms of overall governance.
    Navy Medicine looks forward to working on the next phase of 
the Deputy Secretary's plan. We must proceed and deliver it in 
a measured manner to ensure that our readiness to support our 
service's missions and our core warfighting capabilities will 
be maintained and our excellence in health care will be 
sustained.
    On behalf of the men and women of Navy Medicine, I want to 
thank the committee for your tremendous support, your 
confidence, and your leadership. It is my pleasure to testify 
before you today, and I look forward to your questions.
    [The prepared statement of Admiral Nathan can be found in 
the Appendix on page 83.]
    Mr. Wilson. Thank you very much, Admiral.
    General Green.

 STATEMENT OF LT GEN CHARLES B. GREEN, USAF, SURGEON GENERAL, 
                         U.S. AIR FORCE

    General Green. Thank you.
    Chairman Wilson, Representative Davis, and distinguished 
members of the committee, thank you for inviting me here today. 
The Air Force Medical Service could not achieve our goals of 
readiness, better health, better care, and best value without 
your support, and we thank you.
    To meet these goals, the Air Force Medical Service is 
transforming deployable capability, building patient-centered 
care, and investing in education, training, and research to 
sustain world-class health care.
    This year, we established 10 new expeditionary medical 
support health response teams. These 10-bed, deployable 
hospitals enable us to provide emergency care within 30 minutes 
of arrival at scene and perform surgery within 5 hours in any 
contingency. Light and lean, it is transportable in a single C-
17, with full base operating support requiring only one 
additional C-17. The health response team was used successfully 
in the Trinidad humanitarian mission last May and is our new 
standard package for rapid battlefield care and humanitarian 
assistance.
    Critical care air transport teams and air evacuation 
continue to be a dominant factor in our unprecedented high 
survival rate. To close the gap and enter a critical care 
continuum, we applied the CCAT [critical care air transport] 
concept to tactical patient movement, delivering the same level 
of care during intratheater transports on rotary platforms.
    The Tactical Critical Care Evacuation Team was fielded in 
2011, and five teams are now trained. Two teams are currently 
deployed to Afghanistan, and each team has an emergency 
physician, two nurse anesthetists. And we are able to move 
critical patients between level 2 and level 3 facilities even 
more safely.
    At home we enrolled 920,000 beneficiaries--actually, today 
it is 940,000 beneficiaries--into team-based, patient-centered 
care at all Air Force medical treatment facilities. This care 
model reduced emergency room visits, is improving health 
indicators, and achieved unprecedented continuity of care for 
our military beneficiaries.
    The Air Force remains vigilant in safeguarding the 
wellbeing and mental health of our people. Post-deployment 
health reassessment completion rates are consistently above 80 
percent for Active Duty, Guard, and Reserve personnel. The new 
Deployment Transition Center at Ramstein Air Base, Germany, 
provides an effective reintegration program for our deploying 
troops, and more than 3,000 have been through to date. We focus 
on our highest-risk patients, our beneficiaries. And a study of 
the airmen who have attended showed significantly fewer systems 
of post-traumatic stress and lower levels of both alcohol use 
and conflict with family or coworkers upon their return home.
    By this summer, behavioral health providers will be 
embedded in every primary care clinic in the Air Force. And we 
reach our Guard and Reserve members through telemental health 
efforts and embedded psychological health directors, and we are 
further increasing mental health provider manning over the next 
5 years.
    New training to support air evacuation and expeditionary 
medical capability is now in place. Our training curriculums 
are continuously updated to capture the lessons from 10 years 
of war. And our partnerships with civilian trauma institutions 
have proved so successful in maintaining wartime skills that we 
have expanded the training sites to establish new programs with 
the University of Nevada-Las Vegas and Tampa General Hospital.
    We also shifted our initial nursing training for new Air 
Force nurses to three civilian medical centers. The Nurse 
Transition Program now at the University of Cincinnati, at 
Scottsdale, and in Tampa broaden our resuscitative skills and 
experience.
    Air Force graduate medical education continues to be the 
bedrock for recruiting our top-notch physicians. Our graduate 
programs are affiliated with Uniformed Services University and 
civilian universities. And these partnerships build 
credibility, both in the U.S. and international medical 
communities.
    One of our most significant partners is the Department of 
Veterans Affairs. And we are very proud of our 6 joint 
ventures, 59 sharing agreements, and 63 joint incentive fund 
projects, which are improving services to all beneficiaries.
    We also note significant progress has been made toward the 
integrated electronic health record, to be shared by DOD and 
the Department of Veterans Affairs.
    In the coming year, we will work shoulder-to-shoulder with 
our Army, Navy, and DOD counterparts to be ready, to provide 
better health, better care, and best value to America's heroes. 
Together, we will implement the right governance of our 
Military Health System. We will find efficiencies and provide 
even higher-quality care with the resources we are given.
    I thank this committee for your tremendous support to 
military medics. Our success, both at home and on the 
battlefield, would not be possible without your persistent and 
generous support.
    Thank you, and I look forward to answering your questions.
    [The prepared statement of General Green can be found in 
the Appendix on page 109.]
    Mr. Wilson. Thank you very much, General Green.
    And Mr. Strobridge.

 STATEMENT OF COL STEVE STROBRIDGE, USAF (RET.), CO-CHAIR, THE 
                       MILITARY COALITION

    Colonel Strobridge. Thank you, Mr. Chairman, Ranking Member 
Davis, and distinguished members of the subcommittee.
    Less than 3 months ago, the fiscal year 2012 Defense 
Authorization Act became law, which let the Administration 
implement the TRICARE fee increases it recommended last year. 
Now, when the ink is hardly dry, the new proposal would impose 
far higher increases for TRICARE Standard, TRICARE Prime, and 
TRICARE For Life, plus a doubling and tripling of new pharmacy 
co-pays.
    It would raise health costs $1,000 to $2,000 a year or more 
for retirees, and the large pharmacy fee hikes would affect 
many currently serving people, as well--families, the family 
members. Defense leaders say they will keep faith with the 
currently serving on retirement reform, but thousands who 
retire in the next year would incur these new fees. If 
``keeping faith'' means no changes for today's troops on 
retirement, then it is breaking faith to raise their fees by 
$2,000. That is no different than a $2,000 retired pay cut. And 
if it is breaking faith to change the rules for someone with 1 
year of service, then it is doubly so to do that to those who 
have already completed 20 or 30 years.
    For generations, the Government has induced millions to 
complete arduous service careers in uniform with promises that, 
for rendering that sacrifice, they would earn the current 
retirement and healthcare package. In other words, their 
extended service and sacrifice constituted their prepaid 
premium. Now, after retirees have done their part, Pentagon 
leaders say their service isn't worth so much anymore and they 
should pony up thousands more every year for the rest of their 
life.
    They blame the budget crunch but balk at changes to make 
the system significantly more efficient. Many studies document 
the inefficiencies of DOD's fragmented healthcare systems, but 
the recent review made only minimal changes, in part because a 
key decision criterion was how hard the change would be. So the 
first choice was to make retirees pay more because it was 
easier.
    Another argument is that military programs should move 
toward market rates and be more like civilian plans. After all, 
they say, military retirees pay far less for health care than 
civilians do. Whenever somebody gives me that argument, I ask, 
``If the military deal is so great, are you willing to pay what 
they did to earn it? Would you sign up to spend the next 20 or 
30 years being deployed to Iraq, Afghanistan, or any other 
garden spot the Government wanted to send you to?''
    Military people pay far steeper premiums for health 
coverage than any civilian ever has or ever will. That is why 
military coverage is supposed to be top-tier coverage, not just 
the civilian median.
    One example: Fifty-six percent of civilian employer plans 
charge $25 co-pays or less for brand-name medications. That 
puts the new $26 TRICARE proposal in the bottom half of 
civilian plans. Further, TRICARE's $5 retail generic co-pay 
that was implemented last October is already more than 
civilians with no insurance at all pay at Wal-Mart and many 
other pharmacies. And they want to raise the military co-pay 
again.
    As for the plan to means-test retiree health fees, that is 
patent discrimination against the military. No other Federal 
retiree has service-earned health benefits means-tested, and it 
is rare in the civilian world. Under that perverse system, the 
longer and more successful you serve, the less benefit you 
earn. The Coalition believes strongly that the proposed rates 
are significantly too high for all military beneficiaries.
    Finally, the Coalition objects very strongly for tying 
TRICARE fee growth to any index of health-cost growth. On 
behalf of the MOAA [Military Officers Association of America] 
and 22 other associations, we strongly support the position you 
established in the fiscal year 2012 Defense Authorization Act: 
that the percent growth in TRICARE fees in any given year 
should not exceed the percentage growth in military retired 
pay.
    We are grateful for this opportunity to present our views, 
and I will be pleased to answer any questions.
    [The prepared statement of Colonel Strobridge can be found 
in the Appendix on page 129.]
    Mr. Wilson. Thank you very much, Mr. Strobridge.
    And as we begin--and I am going to be on the 5-minute clock 
myself. But as we begin, I want to thank you. And I agree with 
General Horoho that miracles are performed every day. And as a 
military parent, as a veteran, I appreciate so much your 
service. It is so reassuring to know that the survival rate of 
our military is the highest in world history and, also, the 
technological advances for our wounded warriors is the best, 
again, in world history. And it is just reassuring as a parent.
    As we prepare today, Dr. Woodson, I am concerned--and I 
appreciate the points made by Mr. Strobridge. Based on your 
projections, 60 percent of the savings from the TRICARE 
proposals will come from beneficiaries choosing not to use the 
benefit they earned by serving or by using it less.
    How did DOD calculate the estimated savings from 
beneficiaries opting out of TRICARE?
    Secretary Woodson. Thank you, Mr. Chairman, for the 
question.
    I must admit I am a little perplexed at how those numbers 
are summed up. Our rationale going into deriving the fee 
adjustments were coming from the issue of what we needed to 
achieve in cost savings over 10 years. That is the $487 billion 
and, over the FYDP [Five-Year Defense Plan], of $269 [billion].
    And although personnel benefits are a third of DOD's costs, 
90 percent of the savings actually comes from reduction in 
weapons programs, force reductions, and the like. And, as I 
mentioned in my opening statement, healthcare costs could not 
be excluded and had been the subject of some review over a 
number of years, as the fees for TRICARE had not increased for 
some 15 or 16 years until the recent NDAA [National Defense 
Authorization Act].
    And so we were left with about $29 billion to look at. And 
even with that $29-billion sort of assessment, we only took 
really less than half of that, $12.9 billion, really over the 
FYDP and applied those really to sort of the fee adjustments, 
and then spread it across all of the programs so, again, no one 
beneficiary group was unduly affected.
    So the real issue is about a rebalancing. And it is not 
even rebalancing to the original cost-share formula that 
Congress agreed to when we started the program. And the 
Secretary and the line leadership, who were heavily invested in 
both the adjustments and the tiering--remember, these are 
members in uniform, who spent the 35 years in uniform and are 
going to retire and are going to be subjected to these fees--
felt strongly--and this included the senior enlisted 
leadership--felt strongly that there should be tiering and that 
they were the right adjustments to make at this time.
    And I remind the committee also that we were guided by 
prior studies, such as the 2007 task force on the future of 
health care, which specifically, among other things, noted that 
these are one of the reforms that we should undertake.
    So that is how we arrived at it. It wasn't an issue of 
trying to force people out of TRICARE. And, in fact, our 
numbers suggest that, considering the rise in premiums in the 
private sector and considering some of the other issues that 
affect health care, we may have more people taking advantage of 
their TRICARE benefits, so quite the opposite.
    Now, the truth is that maybe some may want to switch to 
Standard, which has a different cost share, but there is no 
attempt, absolutely no attempt, to drive people away from their 
TRICARE benefit.
    Mr. Wilson. Well, I know of your personal commitment, but I 
am concerned about the formula, particularly with TRICARE fee 
increases, that an E-7 who served 28 years is going to pay more 
than an E-7 who served 20 years. And that doesn't seem fair to 
me, that people who serve longer pay more.
    Secretary Woodson. Well, you are speaking to the formula--
again, line-driven, uniform-driven on this. I can't emphasize 
that enough, that they took the mantle on this. The issue is 
that they felt strongly that those who make more should pay 
more. Their increases over the years, in fact, have been 
proportionally more because they come out with more retired 
pay. But for 16 years there has been no increase. So the issue 
is, they felt strongly that this was a fair way to go.
    Mr. Wilson. Thank you.
    We now proceed to Ms. Davis.
    Mrs. Davis. Thank you, Mr. Chairman.
    And I certainly can acknowledge that we are all probably 
going to dig in on this issue to a certain extent. But I think 
it is also very fair to ask what would happen if, in fact, 
approval of these changes did not go forward.
    Secretary Woodson. Thanks again for that very important 
question because if--as I mentioned, 90 percent of the savings 
came from other areas, so planes, ships, people. If we don't go 
forward with these TRICARE fee adjustments, we will have to 
look at planes, ships, and people again.
    And so the issue is that, if we look at people, we are 
looking at maybe a 50 percent more increase in the reduction of 
the force. And while I wouldn't want to fix a number on this, 
we are talking about anywhere from, you know, 30,000 to 50,000 
troops.
    Mrs. Davis. Okay. Well, thank you. I mean, we know we are 
in a very difficult space.
    And I guess, Mr. Strobridge, you probably have the most 
difficult job of anybody up there, in many ways. And I think in 
your comments you also were looking at ways that we could 
expand benefits while at the same time, I think quite 
eloquently, saying that, you know, this is not the place to 
increase these on the men and women who serve and sacrifice for 
our country.
    But, within that, of looking to expand and wanting to not 
change anything, where do you see any kind of wiggle room 
there?
    Colonel Strobridge. Well, there are various views among the 
associations. And, as I said a little earlier, MOAA and 22 
other associations have not taken the view that there should 
never be a single fee increase. We think that, you know, over 
time, as retired pay rises, there is an expectation that fees 
will rise. But we think that they have to be reasonable. And we 
think that the standard that the committee established last 
year, by tracking to the COLA [cost-of-living adjustment] 
percentage, is reasonable.
    I would like to make one comment in terms of, you know, 
what are the alternatives. One of the things that we have said 
very consistently is that there are ways to make the system 
more efficient without raising beneficiary fees. We have talked 
to people who have done reviews in the last couple of years who 
have raised the figure of a potential savings of 30 percent if 
you reorganized the system, with no requirement to cut benefits 
and no increases in beneficiary fees. That entails significant 
reorganization of how health care is delivered in the military 
system.
    I was the defense implementation officer for the Goldwater-
Nichols provisions, the jointness provisions. And I can tell 
you, at that time, all the hearings said it was too hard, we 
can't do it. None of the Services wanted to do it. We did it, 
because Congress directed it. And I believe the same potential 
lies here.
    Mrs. Davis. Yeah. Thank you.
    You asked my next question for me. I appreciate that. 
Because I wanted to turn to Dr. Woodson, because we know that 
the Department of Defense has proposed another change in 
governance structure. In 2006, we saw a change to that.
    And I am just wondering, of the--I believe there were seven 
governance initiatives that were supposed to achieve some 
economies of scale and operational efficiencies, how many have 
projected any estimated savings? Do we see savings there? How 
much of the $200 million annual savings has been realized that 
I think we were hoping for? And going back to Mr. Strobridge's 
question--and I know I am running out of time--how does that 
improve jointness?
    Secretary Woodson. Thank you very much for this important 
question.
    Clearly, it improves jointness, and I will return to that 
in just a minute.
    But just to put it in context, you know, when we talk about 
30 percent savings and what is achieved by reorganization, you 
are focusing really on the least costly part of the Military 
Health System--that is, the headquarters and sort of the 
administrative activities. And so that is about 2 percent of 
budget. The real area that you need to affect is in sort of the 
cost of delivery of care, so what we call Budget Area Group 1 
and 2, which is the big balloons, you know, accounting for 
probably out of the DHP $25 billion or more in that situation.
    And so the thing that everyone needs to understand is that 
we are committed to restructuring the MHS to produce the most 
efficient administrative system. So we are already bought off 
on that, and that is why we made the proposal to the DHA 
[Defense Health Agency]. But it really is a leverage to produce 
the efficiencies and developing the strategies for delivering 
the care so that we improve access and quality at a lower cost, 
so a better value for the dollars that are spent.
    But to speak to what we have already done, clearly, you 
know, we have made amazing changes over the years in terms of 
the administrative structure to drive out that waste. We 
accepted, actually, MOAA's suggestion some years ago about 
looking at our pharmacy approaches and going to Federal ceiling 
pricing, and we have already saved $3.4 billion in talking 
about administrative process; and fraud and recuperation of 
fees, $2.6 billion; medical acquisitions, $31 million a year. 
We have reduced headquarters already last year by 440 FTEs 
[Full Time Equivalents] and are on track to reducing it to the 
total of the 680 that we talked about with Congress last year.
    And so we have undertaken a lot of initiatives, some of 
which I won't talk about now. So the issue is, we have really 
squeezed that lemon called an administrative process. And with 
the report to Congress, I think we are doing the right things 
in terms of reform.
    With the Defense Health Agency that is proposed, you know, 
we will be focusing on the issues of health IT [information 
technology], of medical education, of medical logistics, of 
sort of research and development, and being able to reduce an 
additional probable, at least, on the conservative side, 300 
FTEs out of the administrative process.
    So I think we have worked diligently together to look 
forward and design a system that is responsive, not only to 
sort of our mission, to try and do our mission better, but to 
do it in a cost-efficient way. But the key is that that is only 
2 percent of our budget.
    Mr. Wilson. Thank you, Ms. Davis.
    And we will now proceed by order of appearance. And Dr. 
Heck ran across the street. I saw him, so he was here first.
    Dr. Joe Heck from Nevada.
    Dr. Heck. Thank you, Mr. Chairman.
    And thank you all for being here, and thank you all for 
your service to our Nation, both in and out of uniform, and to 
the men and women that are still serving.
    We talk a lot about dollars, but to me it doesn't make a 
difference, the dollar amount, if there is no access. And so, 
Dr. Woodson, primarily I have two questions regarding access 
that I would like to bring up, two issues.
    One is the contracting process by which the TRICARE 
contracts are awarded. As I am sure you are aware, there was 
recently an appeal in the TriWest region, in the west region, 
that resulted in a change of the contract provider. And that 
appeal occurred almost 2 years after the contract was awarded 
and after the other entity lost an appeal in another region.
    And so I am wondering, what is the process that allows that 
to happen, where you are appealing in one region, you are not 
successful, and then you reserve the right to appeal in another 
region 2 years later after the awardee has already, you know, 
been providing very good quality care?
    And in full disclosure, I say it as a former not only 
TriWest beneficiary but a TriWest provider. How does that--I 
mean, that whole acquisition and contracting process just 
doesn't seem like it is something that should be working in 
that regard.
    Secretary Woodson. Thank you very much for the question. 
And I think it is actually quite the reverse. The acquisition 
process is a difficult, somewhat cumbersome process, but it is 
carried out according to due process to ensure fairness. And 
some of the protests that have been raised have been protests 
about the process, and that is why you have to do it with all 
due diligence.
    We have, you know, in place the requirement that no one 
provider or group can operate in two different regions. And 
that has to do with making sure that if there was a serious 
problem in any one provider, it would put at jeopardy too much 
of our network, if you will.
    And so what happens is that you just have to go through the 
rather laborious legal and regulatory steps in order to get to 
a final decision and give the competing entities the right to 
appeal. It is just part of the process. And we know it takes 
time.
    But one of the things that we have done is, we have 
actually reformed our acquisition process to ensure that there 
is fair adjudication of the individuals or the entities that 
are competing for these contracts. And it is understandable 
that they would protest. These are very large contracts, and it 
is important to their business. And it is just a process that 
needs to be played out.
    Dr. Heck. Well, I can appreciate that, but it would just 
seem odd that you can maintain a right of appeal in one region 
while you are being adjudicated on a protest in another region, 
and if that doesn't work, then you can come back, you know, and 
protest another place after that original awardee has put 
together their care provisions.
    Is that a statutory, a regulatory, is that a DOD policy? 
Where does that fall, that process that is in use?
    Secretary Woodson. Well, it is statutory, regulatory. It is 
all of those things, if you will.
    I am not sure that the two are necessarily tied, as 
suggested. Each of the regions went through their process of 
sort of looking at the proposals and adjudicating them and 
ranking them and making decisions by the source authority, 
basically, and it was played out.
    Dr. Heck. Well, I appreciate that.
    Secretary Woodson. And it is a complicated process, but it 
is there for everybody's protection.
    Dr. Heck. And just quickly in my last few remaining seconds 
here, I recently received a letter that the Department of 
Defense is considering not recognizing the accreditation of 
osteopathic residency programs. And when we talk about 
maintaining access to quality healthcare providers, I was 
wondering if you have had any visibility on that. We sent a 
letter off asking for further information, but we would 
certainly appreciate follow-up on that, as well.
    Secretary Woodson. I had not heard about that as an issue, 
but I will take that for the record and I will respond to you.
    [The information referred to can be found in the Appendix 
on page 223.]
    Dr. Heck. Thank you.
    Thank you, Mr. Chair. I yield back.
    Mr. Wilson. Thank you very much, Doctor.
    And we now proceed to Congresswoman Madeleine Bordallo of 
Guam.
    Ms. Bordallo. Thank you, Mr. Chairman.
    And to all of our witnesses, I thank you for your testimony 
today.
    Dr. Woodson, I have a question for you. Do you have any 
statistics in regards to the rise and/or fall of military 
healthcare costs as we drew down in Iraq?
    Secretary Woodson. Thank you for the question, and it is a 
little bit of a complicated answer, and here is the reason why.
    Some of the costs of medical care are funded by OCO 
[Overseas Contingency Operations] funds. And if you look at 
probably the last 10 years of war, as best as we can dissect 
out sort of the relative cost, the increase in costs for the 
overall DHP is probably only in the range of about 6 percent. 
But I want you to understand that it depends on how you dissect 
out the cost.
    But the point I want to make is that most of the rise in 
costs is really parallel to what is experienced in the civilian 
sector in terms of health inflation costs, which has been 
relatively steep over--at least particularly in the first part 
of the first 5 years of the century. So the issue of the 
defense health costs are really driven by that equation, what 
we pay for care in the private sector and the cost of 
delivering care in our direct care setting, the medical 
treatment facilities.
    And that is why I pointed out before that, as much time as 
we spend talking about reorganizing and restructuring the 
administrative process, most of the money is in bag one and bag 
two, which is what we pay for care in the direct care system 
and in the purchased care system.
    So, to sum up, it is hard to answer your question. We 
haven't seen a reduction in the cost coming out of Iraq.
    The other thing I would mention to you is that, just 
because the kinetic war stops today, we have a huge tail in 
terms of taking care of the wounded and injured. So we are not 
likely to see, even if there was a precipitous increase in cost 
due to the war, a drop-off.
    What is interesting, also, for the committee to know about 
is that last week we convened a 1-day conference looking at the 
long-term healthcare needs of wounded, ill, and injured. So we 
are talking about what they are going to need 10, 20 years down 
the pike or more. And we got a lot of interesting information 
about what that tail looks like and what we should be focusing 
on going forward.
    So the answer to your question is, no, we haven't seen a 
reduction in the cost. The tail will be there for a long time. 
And there still are unknown factors that will affect those 
costs.
    Ms. Bordallo. Thank you.
    Another question for you, Dr. Woodson. What efforts is the 
Department of Defense taking to find efficiencies within its 
overall medical system?
    For example, we may have moved to a joint medical facility 
up in Bethesda, but I am not certain we have a truly joint 
medical system that reduces redundancies between each of the 
Services' healthcare providers. So I hope you can elaborate on 
what is being done to make a more joint healthcare delivery 
system and finding ways to reduce cost.
    Secretary Woodson. Thanks again. And I think that speaks to 
the report to Congress and our proposal to develop a defense 
health agency. It is looking at all of those shared and common 
services that have redundancies within each of the Services, 
trying to move them into a single management agency, reduce the 
cost. We talked about probably saving 300 FTEs. And that is 
just one model of looking at how do you reduce costs.
    We really do believe that there are other efficiencies that 
will be driven, so that within the health IT we will be able to 
make some additional reductions. Within medical training, we 
will be able to make some reduction. Medical logistics, we will 
make some reductions. So the modest end of what we will achieve 
is represented by, you know, the 300 FTE reduction, which 
equates to about $50 million to $100 million a year.
    Ms. Bordallo. Fifty million to $100 million?
    Secretary Woodson. Yes.
    Ms. Bordallo. Great. Thank you very much, Doctor.
    And I yield back my time. Thank you, Mr. Chairman.
    Mr. Wilson. Thank you very much.
    We now proceed to Colonel Allen West of Florida.
    Mr. West. Thank you, Mr. Chairman and Ranking Member.
    And thanks to the panel for being here.
    And, look, I am going to be very honest. I didn't go to law 
school, nursing school, medical school. I went to airborne 
school, so I am going to use a little paratrooper logic here.
    Mr. Strobridge, Dr. Woodson, did we have any consultation 
about this whole plan with military veteran organizations?
    Colonel Strobridge. No.
    Secretary Woodson. We had no direct consultation with the 
military organizations in putting this proposal together. What 
we did have is information that they had provided to us over 
years about their thoughts on these same issues, since this is 
not a new set of issues that has come up.
    Colonel Strobridge. Well, I would say, no, there wasn't any 
consultation.
    A couple of examples: You know, the one comment was made 
that we are talking about just the headquarters. The issue on 
reorganization isn't the headquarters. The issue is 
consolidation of responsibility and accountability for the 
budget, which we don't have right now. When a base wants to 
save money and they get ordered to cut their budgets, they can 
reduce the medications and the formularies, send people 
downtown, which costs more money but it doesn't affect them 
because the charge goes to DOD. It is those kinds of 
inefficiencies that you have to eliminate by the reorganization 
in terms of how you deliver care, so that you get rid of that, 
you know, ``I will just shift my expense over to somebody 
else.''
    The other example was the mail-order pharmacy, which Dr. 
Woodson is correct, we have pushed the Defense Department for 
several years to put more effort into promoting the mail-order 
pharmacy. We had a formal proposal to form a partnership with 
them by which the associations would go out and put out a 
common package developed by the Department of Defense that we 
would work with the Medicare supplement insurance companies, 
who also have an incentive to reduce their expenses if people 
reduce their drug expenses. After a year, we got one meeting 
for a half-hour. We have had nothing since.
    Mr. West. If I am correct, the population of the United 
States of America is about 350 million. Correct? Somewhere 
thereabout? And when I am reading through this, you provide to 
about 9.6 million beneficiaries. Are we supposed to believe 
that less than 1 percent are causing the fiscal woes of this 
country? That is something that really disturbs me.
    Furthermore, I read that in fiscal year 2013 we are looking 
at $452 million of savings; fiscal year 2013 to 2017, we are 
talking about $5.5 billion of savings. Last year, the GAO put 
out a report, February 2011, that said there is $200 billion to 
$300 billion of redundant and duplicative Government programs 
out there. Why don't we look at that before we start penalizing 
the people that have, you know, given a lifetime of service to 
this country?
    The next question, is there any effect to DOD civilian 
healthcare plans, any changes to their plans?
    Secretary Woodson. Let me address a couple of things.
    Your last question first: No. And in part because we don't 
control that, but, more importantly, they already go through a 
yearly adjustment in fees and have done so over the last decade 
so that they pay about 30 percent of the cost. They already 
have had those adjustments, and civilians have had a pay 
freeze. But that is not within our line of authority, really, 
to address.
    In regards to your first point about the issue of military 
folks being responsible for the national debt crisis, I don't 
think anyone is really saying that. What we are really saying 
is that----
    Mr. West. I mean, let's look at it. I mean, $487 billion, 
and now we are talking about another $600 billion, you know, 
through sequestration. I think that the message coming out of 
Washington, D.C., is that the military is going to be the bill 
payer for the fiscal irresponsibility of Washington, D.C. 
Furthermore, we are going to look at the men and women who have 
given a lifetime of service and say that you are on the cut 
line. That is the message.
    When I briefed this at a town hall meeting in south 
Florida, which has one of the highest percentages of the 
retirees, they were livid because no one is talking about this.
    So this is not about a dollar amount, this is really about 
a trust factor. And what are we saying to future generations of 
retirees and veterans? I mean, we already talked about the ink 
hadn't dried off of fiscal year 2012 and we are doing this in 
2013. What is going to happen in 2014?
    I am not upset with you all here, but I am telling you, 
that is the message that is getting out there and to friends of 
mine that are still in uniform. So, you know, I know my time 
has run out, but I have to tell you something. You have to tell 
Secretary Panetta this is FUBAR [fouled up beyond all 
recognition].
    I yield back.
    Mr. Wilson. Thank you very much.
    We proceed to Colonel--Congressman Mike Coffman of 
Colorado.
    Mr. Coffman. Thank you, Mr. Chairman. I was a sergeant in 
the Army, a major in the Marines, so I didn't get to that rank.
    Let me first say that, in visiting the wounded in Bethesda, 
how impressed I am with the care that they are receiving. And I 
want to commend you for that.
    I come from a military family. My father was in military 
medicine for the second half of his career. And I volunteered 
at Fitzsimons Army Medical Center in Aurora, Colorado, when I 
was a young person, 14, in 1969. And, you know, obviously, the 
technology, we have learned a lot about how to take care of 
particularly amputees, but I remember the morale just being 
terrible for those wounded.
    And I think as America became divided about the war in 
Vietnam, they became divided about support for our veterans. 
And they felt--that was an Army installation, and they felt 
completely disconnected once they were wounded, that they were 
no longer really soldiers, where the wounded that I see in 
Bethesda are connected to their units. They feel that they are 
still a part of the military. And I like it that their 
rehabilitation is done in the military and they are not 
shuttered off to VA facilities. And that is a separate 
discussion, in terms of improving those.
    And I have tracked a double amputee coming out of my 
district, a lance corporal in the Marine Corps, who is able to 
not just walk but run on his prosthetics. He is competing in 
athletic events. He is at Balboa now, naval medical center. And 
I talked to him on the phone last week. He said he is in the 
best shape that he has ever been in. And so I am impressed with 
that.
    One thing, there is one gap that I want to ask you about in 
military medicine that I am concerned about, and that is post-
traumatic stress disorder. And the reason why I am concerned 
about it is because I think that our approach is that we seem 
to have a disability-centric approach and not a treatment-
centric approach. And I think that it would cost us more money 
in the short run but save money in the long run if we would 
shift to more of a treatment-centric approach.
    Those in the mental health profession that I talk to all 
feel that it could be brought--that the symptoms could be 
brought down to where they are not debilitating if given the 
proper modalities of treatment. So I wondered if any of you 
could respond to that issue.
    General Horoho. Sure. I will take that first, if that is 
okay.
    Mr. Coffman. Yes.
    General Horoho. What we have looked at is really shifting 
more toward prevention, and I believe that is what you are 
talking about.
    And so we have, over the last couple years, we have a 
comprehensive behavioral health system of care, where we have 
five touchpoints where our soldiers see a behavioral health 
specialist prior to deployment. In theater, we have increased 
our behavioral health assets. We are using tele-behavioral 
health, so that instead of waiting until they redeploy back to 
deal with some of the stressors and the symptoms associated 
with deployment, they are able to do that through tele-
behavioral health in some of the remote areas in Afghanistan. 
And then we are also--we have over-hired across each of our 
regions, using tele-behavioral health so we can shift that 
capability where the demand is.
    We are also looking, when you look at not just behavioral 
health, but it is looking at stress reduction, anger 
management, alcohol use. So the approach now is more toward 
that prevention and looking at incorporating mindfulness, yoga, 
acupressure, acupuncture, so that we really help with 
decreasing some of that stress.
    Because we agree with you. We have focused more on 
treatment, and over the last couple years it has been more 
toward prevention. And we have a ways to go, though.
    General Green. Sir, if I could add to that, the most recent 
of statistics is--we just went and looked at it. There was a 
perception that, because of the wounded warriors going through 
the IDES [Integrated Disability Evaluation System] system that 
so many of them, as high as 80, 85 percent, also had PTSD, that 
we were putting a lot of people out because they had PTSD. But 
the reality is, of those diagnosed with PTSD, 75 percent are 
returned to duty. So our focus is on treatment.
    Obviously, I agree with General Horoho in terms of what we 
are doing to try and prevent this in the first place. But I do 
think that it is a bit of a misperception to think that we are 
not focused on treatment when we are bringing 75 percent back 
to duty.
    Mr. Coffman. Admiral.
    Admiral Nathan. And if I may just add one caveat, sir, 
which is, my previous command role to this was the commander at 
Walter Reed Bethesda. And you talked about the two signature 
injuries in your question, one was amputations and limb loss, 
and the other is traumatic brain injury and post-traumatic 
stress.
    And what we have learned in PTS and PTSD is that it not 
only takes the individual or the patient with it, it takes the 
family along, too. In other words, it is a family illness and, 
basically, can be devastating not only to a single patient, 
such as loss of limb, but to family. And so we provide a much 
more holistic approach now across the military, engaging family 
care at the same time that we engage the patient.
    We actually created the national center of excellence for 
TBI at Bethesda, the National Intrepid Center of Excellence, 
NICoE, which is this avant-garde building there which is 
basically designed to be a prototypical facility to create and 
try innovative and new procedures, garnering the best academic, 
private, and military specialists available to look at new 
diagnostic and therapeutic techniques.
    And as they treat their cohorts of patients, they treat 
them at the same time as the families. The families are flown 
in, brought in. And the entire family, including children, are 
taken through diagnostic and therapeutic trials along with the 
patient.
    We are seeing some marvelous results from that. It is 
labor-intensive, it is personnel-intensive, and so it is going 
to be hard to replicate that across the entire spectrum. But we 
are starting to create satellite NICoEs in places like Camp 
Lejeune and Belvoir, and I think we will see more of those 
grow.
    Mr. Coffman. Thank you, Mr. Chairman. Just to say that I 
think that is a much cheaper approach than sending somebody a 
disability check for the rest of their life.
    With that, Mr. Chairman, I yield back.
    Mr. Wilson. Thank you all very much.
    And if there are no further questions--and Congressman 
Walter Jones of North Carolina had an appointment at the 
office, and so I have questions that he wanted submitted for 
the record for Dr. Woodson. And so, with unanimous consent, 
they shall be included.
    As we conclude, again, thank you for your sincere and 
genuine concern for our military personnel, military families, 
and veterans. And we look forward to working with you to 
provide the world-class health care that you are providing.
    Thank you, and we shall now be adjourned.
    [Whereupon, at 4:20 p.m., the subcommittee was adjourned.]
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                            A P P E N D I X

                             March 21, 2012

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              PREPARED STATEMENTS SUBMITTED FOR THE RECORD

                             March 21, 2012

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

      
                      Statement of Hon. Joe Wilson

           Chairman, House Subcommittee on Military Personnel

                               Hearing on

                 Defense Health Program Budget Overview

                             March 21, 2012

    Even in this tight fiscal environment, the Military Health 
System must continue to provide world-class health care to 
beneficiaries and remain strong and viable and fully funded in 
order to maintain that commitment. The Department of Defense 
has proposed several measures aimed at reducing the cost of the 
Defense Health Program. Unfortunately, all of the proposals 
simply shift the cost burden to TRICARE fee and cost-share 
increases to not only our working-age retirees but, for the 
first time, to our most senior military retirees.
    The subcommittee has a number of concerns about the 
Department's initiatives. To that end, we would expect the 
Department's witnesses to address our concerns, including that 
the proposed TRICARE Prime fee increases, which have been 
characterized by military leaders as modest, will raise fees in 
fiscal year 2013 by 30 to 78 percent over the current rate. 
Over 5 years, the fees would increase by 94 to 345 percent.
    The proposed increases may be designed to cause military 
retirees to opt out of TRICARE, choose a TRICARE option that is 
less costly to DOD, or decrease their use of TRICARE. The 
proposal would establish an annual enrollment fee for retirees 
who use TRICARE Standard and Extra and, for the first time, 
would require our most senior retirees to pay an enrollment fee 
for TRICARE For Life.
    What is not clear to me is why, aside from the revenue 
being generated from the fees, DOD believes enrolling these 
participants is necessary. What benefit can these individuals 
expect to receive from enrolling? Sixty percent of the 
estimated cost savings from TRICARE proposals is based on 
military retirees opting out of TRICARE or using it less. 
Frankly, I think this plan is wrongheaded.
    Finally, I would like to hear from the military surgeons 
about efforts they are taking within the military departments 
to increase the efficiency of the military healthcare system 
and reduce cost. I would also like the military surgeons' views 
on areas where additional efficiencies can be gained across the 
DOD health system.

                    Statement of Hon. Susan A. Davis

        Ranking Member, House Subcommittee on Military Personnel

                               Hearing on

                 Defense Health Program Budget Overview

                             March 21, 2012

    The last decade of conflict has been weathered on the backs 
of our remarkable forces, in particular, those who serve in our 
military healthcare system. The constant demands borne by those 
in uniform and those in support of them have yielded incredible 
successes on our battlefields abroad and at home here in the 
States. While I suspect that much of this hearing will focus on 
the healthcare proposals of the Department of Defense, this 
hearing will also provide the members of this subcommittee an 
opportunity to understand and examine some of the difficult 
challenges facing the military healthcare system--from 
reductions in resources to meeting the ever-increasing demand 
for mental health services.
    Our military personnel and their families consistently 
exceed expectations under tremendous strains and pressures, and 
their access to quality health care should not be added to 
their plight.
    I look forward to your testimony on how we are caring for 
our service members and their families, particularly our 
injured, ill, and wounded, and how we can continue to improve 
our military healthcare system in the new fiscal environment we 
will be facing.

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


                   DOCUMENTS SUBMITTED FOR THE RECORD

                             March 21, 2012

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

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


              WITNESS RESPONSES TO QUESTIONS ASKED DURING

                              THE HEARING

                             March 21, 2012

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

      
               RESPONSE TO QUESTION SUBMITTED BY DR. HECK

    Secretary Woodson. DOD considers Doctors of Osteopathy and Doctors 
of Medicine as equivalent. I am not aware of any effort or interest 
that would not recognize the American Osteopathic Association 
accredited osteopathic residency programs. [See page 17.]
?

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


              QUESTIONS SUBMITTED BY MEMBERS POST HEARING

                             March 21, 2012

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

      
                   QUESTIONS SUBMITTED BY MRS. DAVIS

    Mrs. Davis. This year, the Department of Defense has proposed yet 
another change to its governance structure. In 2006, the Department 
approved a change to its medical governance structure. Of the seven 
governance initiatives that were supposed to achieve economies of scale 
and operational efficiencies to the tune of $200 million, to date, how 
many have actually achieved any savings?
    Secretary Woodson. The GAO has conducted a study to address this 
question. The findings from that study are poised for release in late 
April 2012. In the report, the GAO specifically assessed each of the 
seven governance initiatives with regard to savings achieved. The 
Department has reviewed the report and has concurred with the findings; 
however, the GAO has asked the department to refrain from quoting from 
the study entitled ``Applying Key Management Practices Should Help 
Achieve Efficiencies within the Military Health System'' until the 
formal release of the report. If additional changes to MHS governance 
are implemented, the Department is committed to a rigorous approach for 
measuring and monitoring costs and benefits of change.
    Mrs. Davis. Last year, this Congress directed the Comptroller 
General to conduct a review of women-specific health services and 
treatment. What is the Department and the Services doing to address the 
healthcare needs of female service members and dependents?
    Secretary Woodson. The National Defense Authorization Act of 2012, 
Section 725 directed the Comptroller General, as head of the Government 
Accountability Office (GAO), to conduct a review of women-specific 
health services and treatment for female members of the Armed Forces. 
This report is to be submitted by the Comptroller General to the 
congressional defense committees no later than December 31, 2012. GAO 
has initiated two new engagements which are to be conducted by its 
Defense Capabilities and Management and Health Care teams. One 
engagement addresses DOD-wide, women-specific healthcare services `at 
home,' while the other engagement pertains to deployment issues, and 
care for female sexual assault victims domestically and abroad. A May 
2002 GAO Report of the adequacy and quality of the health care provided 
to women in DOD found that a full range of healthcare services for 
women are offered, and that members' satisfaction with care was well 
above average. Some concern was noted in areas regarding healthcare 
services or availability of gender-specific supplies in austere 
environments.
    The provision of health care for women in the Armed Forces 
represents not only a clinical concern, but a tactical imperative in 
keeping DOD's forces fit to fight. The Department provides a continuum 
of care ranging from preventive services (including contraception) to 
robust access to primary care; assessment and treatment of medical 
emergencies; referral to specialty care as indicated; care for chronic 
conditions; and rehabilitation and support for transition and 
disability for those whose illnesses or injuries do not permit return 
to full duty. Some medical services, such as Obstetrics and Gynecology, 
are focused on the medical needs of women, but most other adult medical 
services are designed and capable of assessing and treating medical 
conditions regardless of age or sex. When medical needs of any Service 
member exceed capabilities in their duty location, we also have the 
capacity to use medical evacuation to move the Service member to a 
location capable of meeting the specific medical need. The continuum of 
care includes both military and civilian treatment facilities, and we 
work especially closely with our VA colleagues when needs include 
transition from active to veteran status.
    Recent policy initiatives, research, and leadership focus have 
addressed some specific needs and illustrate our commitment to Service 
women. It is important to note that policies on management of sexual 
assault are equally applicable to both male and female victims.
    In FY11, the three new DOD policies augmented efforts to improve 
access to quality healthcare services for the victims of sexual assault 
and ensure continuity of medical care in both deployed and non-deployed 
environments:

          In December 2011, a policy ``Expedited Transfer of 
        Military Service Members Who File Unrestricted Reports of 
        Sexual Assault'' was generated to affect expedited transfer of 
        Service members who file an unrestricted report of sexual 
        assault.
          Also in December 2011, Document Retention in Cases of 
        Restricted and Unrestricted Reports of Sexual Assault, 
        established comprehensive policy for the retention of sexual 
        assault records.
          The DOD Sexual Assault Prevention and Response (SAPR) 
        Program policy was revised for reissuance and published in 
        March 2012. Better policies for prevention, response and 
        oversight of the SAPR program were promulgated.

    In 2008 and 2009, significant advances were made to evaluate and 
meet the medical needs of deploying and returning female Service 
members:

          The Deputy Secretary of Defense convened a Scientific 
        Oversight Committee meeting which specifically addressed Women 
        Wounded Warrior Issues, appraised gender-specific foci in 
        clinical and research studies, and reviewed compliance with the 
        NDAA FY 2008 mandates.
          In October 2009, the Armed Forces Health Surveillance 
        Center published a monograph that focused on the unique health 
        issues of women in combat environments and identified 
        conditions with consistently high incidence rates among 
        females, which served to highlight treatment essentials and 
        inform clinicians' diagnostic sensibilities and medical system 
        requirements in theater.
    Mrs. Davis. There continues to be concern that diagnosis and 
treatment for PTS and TBI are still not at the levels needed to ensure 
that service members are getting the proper diagnosis and treatment for 
either PTS or TBI. Where is the Department and the individual Services 
on this issue?
    Secretary Woodson. The Defense Department (DOD) and Military 
Healthcare System (MHS) remain committed to the delivery of high 
quality care by appropriately diagnosing and treating Service members 
(SMs) with posttraumatic stress disorder (PTSD) or traumatic brain 
injury (TBI). To address PTSD, the DOD has added over 2,000 behavioral 
health providers to military hospitals and clinics, and 10,000 more to 
the care networks since 2009. There are currently many collaborative 
programs in the MHS, to include the Army Re-Engineering Systems of 
Primary Care Treatment in the Military (RESPECT-Mil) and the USAF 
Behavioral Health Optimization Project (BHOP), that systematically 
coordinate care for SMs with psychological health (PH), TBI and other 
co-occurring conditions. The DOD is also highly invested in efforts to 
enhance psychological resilience/prevention, stigma reduction, and 
improved access to PH and TBI services.
    Further, the DOD has placed increased emphasis on PTSD and TBI 
screening in all individual Services to ensure that SMs are getting 
proper and timely diagnoses and treatment. The DOD has established 
enterprise wide screening and assessment procedures to identify both PH 
and TBI in SM at the earliest opportunity. For example, the Directive-
Type Memorandum (DTM) 09-033: ``Policy Guidance for the Management of 
Concussion/Mild Traumatic Brain Injury in the Deployed Setting,'' 
requires the assessment of all SMs involved in potentially concussive 
events. Events requiring mandatory screening include any SM within 50 
meters of a blast, involved in a vehicle collision or rollover, any SM 
who sustained a direct blow to the head or had loss of consciousness. 
All personnel with potentially concussive events are evaluated through 
evidence based clinical algorithms utilizing a mandatory standardized 
screening. Results are recorded for each screened individual, and 
submitted as part of the significant activities (SIGACT) report 
required for blast-related events. The DTM also outlines four clinical 
practice algorithms used by medical personnel. These were recently 
revised in 2012 by a DOD working group that included representatives 
from all Services. Additional efforts are underway at Military 
Treatment Facilities (MTFs) to identify SMs who are medically evacuated 
for any illness or injury, or are otherwise redeployed from theater for 
signs or symptoms of TBI. These additional screenings help to identify 
those SMs with a prior history of TBI or concussion exposure, are newly 
symptomatic, or those with poly-trauma whose injuries may have 
precluded an earlier evaluation for mild TBI. Receiving CONUS MTFs also 
rescreen wounded or ill SMs that are evacuated.
    Additional screening of all SMs for TBI and PTSD also occurs 
through DOD Post-Deployment Health Assessments (PDHA) and Post-
Deployment Health Reassessments (PDHRA). SMs who respond positively are 
referred for further clinical evaluation for mild TBI/concussion and/or 
PTSD. The DOD's focus on TBI screening, diagnosis, and treatment has 
resulted in the development of over 60 TBI programs in MTFs in the non-
deployed setting with varying levels of capabilities, and the 
establishment of 11 Concussion Restoration Care Centers in the deployed 
setting. There are over 377 programs available to help SMs with PH 
problems (including PTSD), in addition to clinical treatment available 
at MTF's and locally through Tricare providers stateside, and through 
deployed providers in-theater.
    Other initiatives to strengthen diagnosis and treatment efforts for 
PTSD and TBI involve the Joint Clinical Practice Guidelines (CPGs), 
which have been created by the DOD and VA to identify and promote 
effective PH and TBI care practices within and between the departments. 
Companion Clinical Support Tools for PTSD are in development and 
scheduled to be released in late summer of 2012. DOD has also developed 
Clinical Recommendations for managing neuroendocrine, visual and 
vestibular disturbances following mild TBI, scheduled to be released in 
2012. Another cooperative effort between the DOD and VA, known as the 
``Integrated Mental Health Strategies'' (IMHS), was developed to 
identify specific mutual goals that improve the quality, consistency, 
and continuity of PH and TBI health care for SMs, Veterans, and their 
families. All individual Services have representatives working on these 
initiatives.
    Finally, the DOD has made a strong financial commitment to continue 
to support research related to factors that inform the development of 
evidence based treatment for both PTSD and TBI. The DOD's neurotrauma 
research portfolio through MRMC includes more than 600 clinical 
research studies encompassing novel treatment modalities to include 
nutraceuticals, complementary and alternative medicine, hyperbaric 
oxygen and other pharmacotherapies. The DOD also currently funds nine 
on-going additional studies to investigate the use of cognitive 
rehabilitation therapies in TBI. The DOD has made cognitive 
rehabilitation techniques available to SMs with cognitive and 
behavioral deficits subsequent to TBI. MRMC also supports DOD efforts 
to sustain a robust PTSD research program. The PTSD portfolio 
represents broad areas of study to include epidemiology, basic science, 
prevention and education, early screening and interventions, 
assessment, treatment, and recovery/return to duty. There are now over 
300 PTSD studies funded and in progress. PTSD and TBI research results 
are used to inform and guide new clinical practices and these 
interventions are systematically taught to providers who treat SM's 
with PTSD and TBI. DOD research efforts will continue to ensure that 
our SMs receive the greatest benefit, via accurate diagnosis and 
effective treatment derived from the most current scientific knowledge 
in the field.
    Mrs. Davis. What are the strategic issues that the subcommittee 
should be considering to ensure the success of the military healthcare 
system?
    Secretary Woodson. The Military Health System has adopted the 
Quadruple Aim to describe our high level goals: improved readiness, 
better health, better care and lower costs. We have grouped the high 
level strategic issues according to the aim they most affect.

    Readiness:

          Understanding and meeting the long term needs for 
        medical care generated by 10 years of war
          Integrating and optimizing psychological health 
        programs to improve outcomes
          Maintaining the skills and capabilities of the all-
        volunteer medical force that has performed so well in serving 
        the warfighter

    Population Health:

          Addressing the behaviors that influence the majority 
        of health outcomes starting with obesity and tobacco use

    Experience of Care:

          Improving safety and quality by implementing evidence 
        based practices across the enterprise and making the MHS the 
        safest health system in the world
          Implementing the integrated Electronic Health Record 
        (iEHR) with the VA to support better decisions, integrate 
        patients into the care process and reduce waste

    Per Capita Cost:

          Optimizing market management to bring care back to 
        our Military Treatment Facilities to support readiness, 
        strengthen Graduate Medical Education and reduce costs
          Aligning incentives to pay for value
          Rebalancing government and beneficiary cost shares
    Mrs. Davis. The Department of Defense has proposed cost increases 
for the health care of our military retirees. Why is the Department 
proposing such large fee increases for our military retirees? What was 
the rationale to begin a means testing for healthcare fees?
    Secretary Woodson. Our proposed changes in the cost-sharing formula 
for health care will mostly affect retirees and, especially, retirees 
who are under the age of 65 and are still in their working years. Since 
2001, the cost of military pay and benefits has grown by over 87 
percent (30 percent more than inflation), while Active Duty end 
strength has grown by about three percent. We felt we had to review pay 
and benefits to avoid overly large reductions in forces and 
investments.
    The military and civilian leadership considered changes in pay and 
benefits based on several guiding principles. To begin with, the 
military compensation system must take into account the unique stress 
of military life. It should not simply be a copy of civilian systems. 
The system must also enable us to recruit and retain needed personnel. 
And we must keep faith with our military personnel.
    Changes affecting pay and compensation were designed to be 
disproportionately small when compared to the changes in forces and 
investments. While pay and benefits account for about one-third of the 
Defense budget, savings from the initiatives we are proposing will 
amount to about $29 billion over the FYDP, which is slightly more than 
10 percent of our savings target.
    It is important to note that the proposed cost-sharing changes are 
still modest compared to the cost-shares, as a percentage of total 
healthcare costs, borne by beneficiaries as recently as 1996. In that 
year, we estimate that retiree beneficiaries were responsible for out-
of-pocket costs representing 27 percent of the total healthcare costs. 
Due to the fact that virtually all beneficiary cost-shares were either 
frozen (or dropped further) since 1996, these out-of-pocket costs 
dropped to 10 percent of the total healthcare costs. While cost-sharing 
is increasing, it is still well below 1996 levels, and will stabilize 
at approximately 14 percent of total health costs under this proposal.
    Where feasible, the proposed fee increases were tiered by military 
retirement pay, based on the principles of the FY 2007 Task Force on 
the Future of Military Medicine. In its deliberations, the Task Force 
recognized that military retirement is not like most civilian 
retirement systems and that the entire military compensation system 
differs from the typical civilian ``salary'' system because much of the 
compensation is ``in-kind'' or ``deferred.'' Thus, changes in the 
healthcare benefit were examined in the context of this unique system 
and its compensation laws, policies, and programs. The Task Force 
believes that, for equity reasons, military retirees who earn more 
military retired pay should pay a higher enrollment fee than those who 
earn less. While this ``tiering'' approach is not commonly used in the 
private sector for enrollment fees, the Task Force believed that it 
made sense in a military environment.
    Mrs. Davis. With your statements supporting the proposed changes to 
TRICARE, what is the impact to the DHP if Congress does not authorize 
the TRICARE fee increases? Even if Congress was to approve the fees, 
how will the Department cover unanticipated costs if the savings 
estimated from beneficiaries opting out of TRICARE do not materialize 
to the estimated levels?
    Secretary Woodson. If Congress does not provide us with needed 
support for the health reform proposals, the Department will have to 
find about $12.9 billion, the projected savings from these proposals, 
from other Defense programs to meet its healthcare obligations. Such 
action would place the new defense strategy at risk. Without needed 
authority, the Department will face further cuts in forces and 
investment to be consistent with the Budget Control Act. The 
Department's budget proposal already makes substantial reductions in 
the investment accounts so further cuts might fall mostly on forces. 
This could mean cutting additional Active Duty and Reserve Forces by 
FY17 at a magnitude that could jeopardize the Department's ability to 
pursue the new defense strategy.
    If the assumptions on the behavioral changes projected in the 
Budget are overstated, savings will be reduced and the Department would 
have to review all requirements and resources available at that point 
in time. However, it is important to note that, if the behavior effect 
is not seen as modeled, the Department would still capture savings 
because those beneficiaries will still be subject to the higher fees. 
For example, if a beneficiary does not switch a prescription from 
retail to mail order, which results in some savings, they would still 
be subject to the higher copay in retail which would still result in 
some savings. However, since the proposals provide some incentive to 
motivate beneficiaries to use more cost-effective healthcare options, 
some behavioral effects will be inevitable. The Department will be able 
to refine its projections over time, based on actual experience.
    Mrs. Davis. Vision injuries have impacted 58,000 OIF and OEF 
service members according to DOD, hearing loss has been diagnosed in 
over 189,000 veterans from OIF and OEF according to VA, and male 
urological injuries from blasts have exceeded 1,670 and yet these 
battlefield wounds have not received the research funding that other 
types of defense medical research programs have in past budgets. Should 
additional funding be provided for these types of injuries given their 
traumatic impact on service members?
    Secretary Woodson. Research in vision injuries, hearing loss, and 
genitourinary injury are included in the Clinical and Rehabilitative 
Medicine Research Program (CRMRP). The CRMRP focuses on definitive and 
rehabilitative care innovations required to reset our wounded warriors, 
both in terms of duty performance and quality of life. Due to advances 
in trauma care, increasing numbers of service members are surviving 
with extreme trauma to the extremities and head. The program has 
multiple initiatives to achieve its goals, including improving 
prosthetic function, enhancing self-regenerative capacity, improving 
limb/organ transplant success, creating full functioning limbs/organs, 
repairing damaged eyes, treating visual dysfunction following injury, 
improving pain management, and enhancing rehabilitative care. These 
initiatives leverage research across the CRMRP to address dismounted 
complex blast injuries that include genitourinary injuries.

    Mrs. Davis. Where is the Army in implementing a confidential 
alcohol program? A pilot program was established in three bases. What 
is the current status of those programs, and what is the Army's plan to 
address the increasing concern of alcohol abuse among soldiers?
    General Horoho. In July 2009, the Army Center for Substance Abuse 
Programs (ACSAP) initiated the Confidential Alcohol Treatment and 
Education Pilot (CATEP) program at Fort Lewis, Fort Richardson, and 
Schofield Barracks. After conducting initial evaluations of the pilot, 
the Army expanded its implementation to Fort Carson, Fort Riley and 
Fort Leonard Wood in August 2010. In July 2011 the Army approved 
testing of CATEP procedural improvements, which included an enrollment 
contract in an effort to decrease the voluntary dropout rate and to 
ensure Soldiers with alcohol disorders receive the treatment their 
conditions require. As of August 2012, CATEP participation at the six 
pilot sites is as follows: a total of 1310 Soldiers self-referred; of 
which 924 were screened and enrolled and 386 were screened, but not 
enrolled. A total of 253 Soldiers have successfully completed CATEP and 
another 127 are currently enrolled. In August 2012, the Deputy Chief of 
Staff, G-1 will provide the Vice Chief of the Army with results of 
CATEP and recommendations for the way ahead on the expansion of CATEP 
Army-wide by Fiscal Year 2013.
    In addition to its efforts with CATEP, the Army recognizes the 
increasing role substance abuse plays in many high-risk behaviors, 
including suicide, and therefore is responding with comprehensive 
prevention resources, increased counselor hiring, and anti-stigma 
campaign efforts.
    To deliver substance abuse prevention services to Soldiers, the 
Army adopted Prime For Life (PFL) as its Alcohol and Drug Abuse 
Prevention Training (ADAPT). PFL, a classroom training platform 
developed over a 25-year time span, is delivered by certified 
Prevention Coordinator instructors. In April 2012, the Army began 
fielding a 4-hour standardized universal prevention training package 
for Soldiers. The Army will continue to define, develop and field 
leader-centric training for substance abuse, leveraging squad and 
platoon leaders.
    As of 25 July 2012, the Army has 481 substance abuse counselors, an 
increase of 57 since September 2011, providing education and treatment 
for Soldiers. We continue recruiting efforts to fill vacancies and put 
several initiatives in place to create a pipeline of resources that 
will be available to fill vacancies.
    The ACSAP completed a comprehensive study of stigma associated with 
substance abuse treatment and found stigma to be prevalent. As a 
result, the Army initiated a new campaign focusing on a more 
comprehensive view of stigma and developed messaging on a broader range 
of issues to encourage Soldiers to seek help for substance abuse, 
behavioral health, sexual assault and other personal challenges.
    ACSAP is currently rewriting Army Regulation 600-85, The Army 
Substance Abuse Program, to codify ASAP policies related to the fitness 
and combat readiness of Soldiers.
    Mrs. Davis. Last year, this Congress directed the Comptroller 
General to conduct a review of women-specific health services and 
treatment. What is the Department and the Services doing to address the 
healthcare needs of female service members and dependents?
    General Horoho. The Women's Health Campaign Plan focuses on 
standardized women's health education and training, logistical support 
for women's health items, fit and functionality of the Army uniform and 
protective gear for females, research and development into gynecologic 
issues during deployment, sexual assault case management, and the 
psychosocial effects of combat on women.
    Mrs. Davis. There continues to be concern that diagnosis and 
treatment for PTS and TBI are still not at the levels needed to ensure 
that service members are getting the proper diagnosis and treatment for 
either PTS or TBI. Where is the Department and the individual Services 
on this issue?
    General Horoho. The Army provides behavioral health care for all 
recognized behavioral health conditions as defined by the Diagnostic 
and Statistical Manual of Mental Disorders, 4th Edition, Text Revision. 
In February 2010 the Army launched the Behavioral Health System of Care 
Campaign Plan to standardize, synchronize, and coordinate behavioral 
health care, including PTSD, across the Army and throughout the Army 
Force Generation cycle. The Army has implemented a comprehensive TBI 
Action Plan based on the 2007 TBI Task Force Report and has hired over 
460 providers since 2007 to evaluate and treat Soldiers with TBI. 
Providers at Army treatment facilities utilize the 2008 VA-DOD Clinical 
Practice Guidelines (CPGs) for the medical management of Service 
Members with concussion/mTBI. This set of CPGs was recently rated as 
the best of 8 CPGs for concussion/mTBI management and represent the 
highest level of scientific evidence. TBI care policy and medical 
algorithms in the deployed environment include special provisions for 
recurrent concussions within the previous 12 months. This proactive 
policy promotes early detection, medical management, and helps prevent 
subsequent concussion while the brain is still healing. In order to 
assist with the medical evaluation and advance TBI research, the 
Department of Defense deployed 3 MRI machines to Afghanistan in October 
2011.
    The U.S. Army Medical Research and Material Command has invested 
over $633 Million since 2007 to advance the science of TBI detection/
screening, diagnosis, and treatment. While a definitive diagnostic 
biomarker for TBI is not available, Army Medicine is collaborating with 
academic and civilian scientists to evaluate tests that help identify 
TBI. The scientific community is also researching promising treatments 
to ensure that they are both safe and effective for TBI rehabilitation.
    Mrs. Davis. The Department of Defense has proposed cost increases 
for health care that not only will impact retirees, but they could also 
impact military dependents. Has your Service looked at the potential 
impact of these fee increases and its impact on retention of the force?
    General Horoho. The Army Medical Department has not studied any 
impact of TRICARE fee proposals on retention of the force.
    Mrs. Davis. With your statements supporting the proposed changes to 
TRICARE, what is the impact to the DHP if Congress does not authorize 
the TRICARE fee increases? Even if Congress was to approve the fees, 
how will the Department cover unanticipated costs if the savings 
estimated from beneficiaries opting out of TRICARE do not materialize 
to the estimated levels?
    General Horoho. If Congress does not support proposed reform, 
ASD(HA) has projected a Department deficit of $12.9 billion which will 
impact other Defense programs in order to meet healthcare obligations. 
Without needed authority, ASD(HA) states the Department will face 
further cuts to important programs and investments. If the assumptions 
on the behavioral changes projected in the Budget are overstated, 
savings will be reduced and the Department would have to review all 
requirements and resources available at that point in time.

    Mrs. Davis. There are anecdotal stories that service members are 
self-medicating themselves through alcohol consumption. What are your 
Services doing as well to address alcohol abuse among airmen, sailors, 
and marines as well?
    Admiral Nathan. Navy Medicine has launched the MORE program (My 
Online Recovery Experience), a web- and phone-based recovery support 
program for Service members recovering from alcohol dependence. MORE 
offers individually tailored patient education and support over a 
secure web-based system with world-wide access, 24 hour-day, seven-days 
a week.
    Additionally, the Navy has a long-standing and extensive Substance 
Abuse & Rehabilitation Program (SARP):

    --SARP has transitioned from an addiction-only treatment program to 
a dual diagnosis program that identifies and treats mental health 
illnesses in addition to identifying and treating substance use 
disorders. SARPs located at Naval Medical Center Portsmouth and Naval 
Medical Center San Diego also treat patients with dual diagnoses 
(substance use disorder and mental health illness).
    --SARP has established screening and treatment protocols for 
substance abuse and dependence, providing necessary treatment and 
rehabilitation with pre- and continuing after-care where appropriate.
    --All program activities comply with established DOD, DON, and Navy 
Medicine guidance or governance.
    --SARPs screen over 10,000 individuals a year, with an estimated 
7,000 to 8,000 enrolling as patients annually.
    --Fifty-two SARPs exist throughout the Navy Medicine enterprise, 
with a mix of Active Duty and civilians who provide screening, 
evaluation, and treatment. Treatments range from education with early 
intervention, to outpatient and intensive outpatient therapies, up to 
the highest level of inpatient care.
    Mrs. Davis. Last year, this Congress directed the Comptroller 
General to conduct a review of women-specific health services and 
treatment. What is the Department and the Services doing to address the 
healthcare needs of female service members and dependents?
    Admiral Nathan. Navy Medicine is committed to delivering 
outstanding, patient-centered healthcare services to our female Sailors 
and Marines wherever and whenever needed. This support includes access 
to care in both operational settings and at our medical treatment 
facilities (MTFs). Navy Medicine continues to offer a full spectrum of 
services to address the unique healthcare needs of female service 
members and their family members. Referral processes are in place to 
provide services not available at local MTFs.
    In addition, Navy Medicine has Clinical Advisory Boards that 
provide current evidence-based practice guidance from subject matter 
experts throughout the Navy Medicine enterprise. Specifically, they 
recommend policy, evaluate clinical practice guidelines and provide an 
endorsement to support Navy-wide integration. At 18 MTFs, there are 
peri-natal clinical advisory boards to guide the practice of maternal-
child health. Town hall meetings, local forums and patient satisfaction 
surveys are used to gather feedback to ensure our patients have the 
required access to services.
    Mrs. Davis. There continues to be concern that diagnosis and 
treatment for PTS and TBI are still not at the levels needed to ensure 
that service members are getting the proper diagnosis and treatment for 
either PTS or TBI. Where is the Department and the individual Services 
on this issue?
    Admiral Nathan. Post-Traumatic Stress Disorder (PTSD) is one of 
many psychological health conditions that adversely impacts operational 
readiness and quality of life. Navy Medicine has an umbrella of 
psychological health programs that target multiple, often co-occurring, 
mental health conditions including PTSD. These programs support 
prevention, diagnosis, mitigation, treatment, and rehabilitation of 
PTSD. Our efforts are also focused on appropriate staffing, meeting 
access standards, implementing recommended and standardized evidence-
based practices, as well as reducing stigma and barriers to care. 
Priorities include:

          Embedding psychological health providers in Navy and 
        Marine Corps units, ensuring primary and secondary prevention 
        efforts and appropriate mental health care are readily 
        accessible for Sailors and Marines.
          Embedding psychological health providers in the 
        primary care setting where most service members and their 
        families first seek assistance for mental health issues 
        enhancing integrated treatment, early recognition and access to 
        the appropriate level of psychological health care. The 
        Behavioral Health Integration Program in the Medical Home Port 
        is a new program that is actively being implemented across 69 
        Navy and Marine Corps sites.
          Maintaining support to 17 Deployment Health Centers 
        (DHCs) as non-stigmatizing portals of care for service members 
        outside the traditional mental health setting.
          Implementing innovative programs like Overcoming 
        Adversity and Stress Injury Support (OASIS) at the Naval 
        Medical Center San Diego is providing intensive mental health 
        care for service members with combat-related mental health 
        symptoms from posttraumatic stress disorder, as well as major 
        depressive disorders, anxiety disorders and substance abuse 
        problems. Care is provided seven days a week for 10-12 weeks, 
        and service members reside within the facility while they 
        receive treatment.
          Providing active consultative subject matter 
        expertise to Line Leaders, focusing on preventive measures, 
        early pre-clinical recognition and intervention, as well as 
        recommended treatment management.

    In addition, TBI care on the battlefield has improved significantly 
since 2007 when it was labeled as a ``signature injury'' of the current 
conflicts. Most improvements have targeted early screening and 
diagnosis followed by definitive treatment. In 2010, Directive-type 
Memorandum 09-033 resulted in improved diagnosis and treatment of 
battlefield concussion. Policy highlights include mandatory screening 
by line commanders for any service member in a potentially concussive 
event, standardized medical screening with a 24 hour rest/recovery 
period regardless of diagnosis, rest and education (the only proven 
clinically effective treatments) for diagnosed concussion, and 
guidelines for evaluation, treatment and return to duty for symptom-
free service members with 1, 2 or 3 concussions in a 12-month period.
    From 1 AUG 2010 to 30 AUG 2011 this policy resulted in the enhanced 
screening for 187 Sailors and 4684 Marines, resulting in diagnoses of 
concussion in 27 Sailors and 803 Marines from that group. For the Navy 
and Marine Corps, the primary treatment site for concussed service 
members is the Concussion Care Restoration Center in Camp Leatherneck.
    Since opening in 2010, the Camp Leatherneck has treated over 930 
service members with first-time concussions, resulting in a greater 
than 98% return to duty (RTD) rate, and an average of 10.1 days of duty 
lost from point of injury to symptom-free RTD. There is also a 
concussion clinic at the NATO Role III Hospital in Kandahar. Upon 
return from deployment, enhanced screening methods for TBI and mental 
health conditions are being piloted at several Navy and Marine Corps 
sites. This includes increasing use of the National Intrepid Center of 
Excellence (NICoE) along with development of NICoE satellite sites to 
provide state-of-the-art screening and treatment for those patients 
that do not improve with routine clinical care.
    We are also heavily engaged in active and expansive partnerships 
with the other Services, our Centers of Excellence, the VA, and leading 
academic medical and research centers to make the best care available 
to our warriors afflicted with PTSD and TBI.
    Mrs. Davis. The Department of Defense has proposed cost increases 
for health care that not only will impact retirees, but they could also 
impact military dependents. Has your Service looked at the potential 
impact of these fee increases and its impact on retention of the force?
    Admiral Nathan. The Department of Navy supports these proposals and 
believes they are important for ensuring a sustainable and equitable 
benefit for all our beneficiaries. While the proposed increases will 
primarily impact our retired beneficiaries, military medicine provides 
one of the most comprehensive health benefits available. These changes 
will help us better manage costs, provide quality, accessible care and 
keep faith with our beneficiaries.
    Mrs. Davis. With your statements supporting the proposed changes to 
TRICARE, what is the impact to the DHP if Congress does not authorize 
the TRICARE fee increases? Even if Congress was to approve the fees, 
how will the Department cover unanticipated costs if the savings 
estimated from beneficiaries opting out of TRICARE do not materialize 
to the estimated levels?
    Admiral Nathan. Based on information provided by the Assistant 
Secretary of Defense for Health Affairs, if Congress does not provide 
the needed support for the health reform proposals, the Department of 
Defense will have to find about $12.9 billion, the projected five year 
savings from these proposals, from other Defense programs to meet its 
healthcare obligations. If the assumptions on the behavioral changes 
projected in the Budget are overstated, savings will be reduced and the 
Department of Defense would have to review all requirements and 
resources available at that point in time.

    Mrs. Davis. There are anecdotal stories that service members are 
self-medicating themselves through alcohol consumption. What are your 
Services doing as well to address alcohol abuse among airmen, sailors, 
and marines as well?
    General Green. As with any community, there are members of the Air 
Force who will use alcohol to self-medicate. Therefore, the Air Force 
has implemented processes to educate service members about the dangers 
of alcohol misuse, to recognize this when self-medication and other 
forms of alcohol misuse occurs, and to provide services when needed to 
treat both substance abuse and other problems that individuals may use 
alcohol to address.
    One means of addressing alcohol misuse is that Air Force medical 
professionals provide alcohol abuse prevention briefings to our first-
term Airmen, at base Newcomers' events, and annually to commanders, 
first sergeants, other senior enlisted personnel and medical 
professionals. Airmen involved with alcohol-related misconduct are 
provided individualized, focused education to prevent recurrence or 
worsening of alcohol related problems.
    Additionally, Air Force medical providers also provide screenings 
and treatment for alcohol abuse. Our medical providers screen patients 
from all Services for alcohol misuse at each visit to primary care 
medical home, and screen Air Force members during their annual health 
assessment. Service members are also screened for depression and Post 
Traumatic Stress Disorder and are provided effective mental health 
treatment when necessary so there is no need to self-medicate with 
alcohol. We also screen Airmen four different times as part of the pre- 
and post-deployment health assessments. Healthcare providers address 
concerns regarding a service member's drinking behaviors as they arise. 
When further evaluation or treatment is necessary, a referral is made 
to an integrated behavioral health provider in the primary care clinic 
or to the specialty substance abuse providers. Our staff in the 
Specialty Substance Abuse Programs at each Air Force installation will 
assess service members and provide the appropriate education or 
treatment, including a referral to a civilian program if a higher level 
of care is needed than can be provided on the installation.
    Mrs. Davis. Last year, this Congress directed the Comptroller 
General to conduct a review of women-specific health services and 
treatment. What is the Department and the Services doing to address the 
healthcare needs of female service members and dependents?
    General Green. The Air Force maintains a robust women's healthcare 
program and provides women's health services at all Air Force bases in 
the United States and overseas by either direct provision of care or 
through timely referral. Most of our 75 medical treatment facilities 
provide women's healthcare services through separately established 
women's health clinics. These clinics provide comprehensive women's 
health services, including well exams, health teaching and screening, 
gynecological services, colposcopy, loop electrosurgical excision 
procedure (LEEP), birth control services, and hormone replacement 
therapy, to active duty, retired and dependent females. In addition to 
primary care physicians and obstetrician/gynecologists, the Air Force 
employs approximately 70 active duty Women's Health Nurse Practitioners 
(WHNPs) and 14 civilian WHNPs.
    In 2008, the Air Force began promoting full-time clinical WHNPs to 
the rank of colonel with the specific goal of keeping these women's 
health ``master clinicians'' at the bedside caring for women and 
running the women's health clinics. Many of our WHNPs are trained as 
sexual assault forensic examiners and providers and in this capacity 
they perform the forensic/legal exams for victims of sexual assault. In 
addition, our WHNPS are deployed around the world to provide care for 
female airman, sailors, marines, and soldiers.
    Air Force Surgeon General obstetric modernization funds have been 
used to: establish an Obstetric Quality Forum to promote patient 
safety, quality outcomes and process improvement; provide lactation 
consultants for each Air Force site that delivers babies; create a 
prenatal care counseling and education video; host a national Patient 
Safety and Critical Care Obstetric conference; and lead a tri-service 
effort to create an evidence-based practice guideline for the 
management of pregnancy across the DOD and VA.
    The Air Force Medical Service is also involved in a number of 
ongoing women's health research projects. The San Antonio Military 
Medical Health System (SAMMHS) Outcomes Coordinator and Pregnancy 
Coordinator completed a prospective randomized trial of 1800 women 
comparing routine one-on-one visits to a group prenatal care model. 
Preliminary results published as part of a collaborative non-randomized 
study with the March of Dimes showed a 60% reduction in the risk of 
preterm birth. The results are being further analyzed and if sustained 
have the potential to change the format of prenatal care around the 
world. The Patient and Physician Radiotherapy Schedule Preferences for 
Breast Cancer treated with Breast Conservation Therapy study seeks to 
align of physician practice patterns with best evidence and patient 
preferences in order to enhance patient autonomy and improve cancer 
care. Recognizing that the pregnant spouses of deployed service members 
face unique challenges, the Air Force Medical Service is engaged in the 
Mentors Offering Maternal Support (M.O.M.S.) study to test the 
effectiveness specialized support services for pregnant spouses of 
deployed service members with the goal of promoting prenatal maternal 
adaptation. Other ongoing studies include a research collaboration on a 
FDA-promoted, multinational study involving 17-OH progesterone use for 
the reduction of preterm birth, a randomized controlled trial 
evaluating the use of lavender aromatherapy to reduce pain and anxiety 
during cervical colposcopy, and a study of post-breast lumpectomy 
reconstruction using cell-enriched fat grafting.
    Mrs. Davis. There continues to be concern that diagnosis and 
treatment for PTS and TBI are still not at the levels needed to ensure 
that service members are getting the proper diagnosis and treatment for 
either PTS or TBI. Where is the Department and the individual Services 
on this issue?
    General Green. Thank you for the opportunity to explain the Air 
Force's approach for treating Service members who suffer from Traumatic 
Brain Injury (TBI) or Post-Traumatic Stress Disorder (PTSD).
    The Air Force's goal is to identify and address PTSD and TBI 
symptoms as early as possible, before problems develop and to allow for 
full return to duty. This goal is pursued through a combination of 
programs aimed at screening, awareness education, and evidence-based 
treatment.
    Fortunately, despite Airmen deploying in roles involving combat or 
being involved in the rescue or treatment of those with severe 
injuries, the rate of both PTSD and TBI in Airmen has remained low. Per 
our recent report to Congress, for example, the average PTSD rate of 
new cases for active duty Airmen for 2003 through 2010 was 2.0 per 
thousand (0.2%). The rate of TBI is about 10 per thousand (1%), nearly 
90% of which are mild in severity. In mild TBI full recovery can be 
expected by the majority within weeks.
    The Air Force proactively screens for TBI, PTSD, and other mental 
health concerns on a recurrent basis. This is accomplished via annual 
Preventive Health Assessments and via Post-Deployment Health 
Assessments and Post-Deployment Health Re-Assessments. Additionally, 
Airmen are screened with the Automated Neuropsychological Assessment 
Metrics (ANAM) prior to deployment in order to establish a baseline 
measure of cognitive functioning. Deployed Service members who are 
involved in an event which may cause a TBI are screened for TBI and 
referred for further medical evaluation and treatment if the screening 
is positive. In addition to history and examination, the ANAM may be 
used post-injury in theater and compared to baseline pre-deployment 
ANAM results to aid in the medical evaluation.
    Airmen are provided with awareness education on PTSD and TBI and 
are offered multiple opportunities to identify symptoms and concerns. 
To ease access to mental health providers, many medical treatment 
facilities have one or more mental health providers working directly in 
the primary care clinics.
    Formal training has significantly increased for providers on 
assessment, diagnosis, and treatment of PTSD and TBI. The majority of 
Air Force mental health providers have attended formal training in 
evidence-based treatment of PTSD, and it is included in Air Force 
social work and psychology training programs to ensure providers 
appropriately recognize and treat affected individuals. Education on 
the causes, signs, and symptoms of TBI and PTSD are provided through 
new training modules in Self Aid and Buddy Care, an annually required 
computer based training for all Airmen. More advanced education on TBI 
and PTSD is provided in pre-deployment courses including Expeditionary 
Medical Support course and Combat Casualty Care Course, to include use 
of the Military Acute Concussion Evaluation and the Clinical Practice 
Guidelines for TBI in the Deployed Setting. VA/DOD clinical practice 
guidelines are also taught and used for the management of PTSD and TBI 
in post-deployment health throughout the Air Force. There has been 
increased emphasis on these topics during mental health and neurology 
internship and residency programs. Finally, the Defense and Veterans 
Brain Injury Center hosts an annual TBI Training Program to educate DOD 
and VA healthcare providers. The formal training emphasizes the use of 
evidence-based practices for the treatment of PTSD and/or TBI, to 
include exposure-based therapies (with or without virtual reality 
enhancement), medication management, and combinations of treatments.
    Mrs. Davis. The Department of Defense has proposed cost increases 
for health care that not only will impact retirees, but they could also 
impact military dependents. Has your Service looked at the potential 
impact of these fee increases and its impact on retention of the force?
    General Green. Our retiree population actively shapes perceptions 
of the value of military service. Any action that discourages our 
retiree population can adversely impact recruiting activities. 
Healthcare benefits for active duty military personnel are not impacted 
under the current proposal. TRICARE standard caps affect the small 
number of active duty family members not enrolled in Prime. The 
pharmacy co-pay increases only affect those who do not get their 
prescription filled at an Military Treatment Facility. Although 
increases in healthcare fees may be perceived as a loss of benefit to 
our retiree population, the increases are not expected to negatively 
influence retention of active duty military personnel.
    Mrs. Davis. With your statements supporting the proposed changes to 
TRICARE, what is the impact to the DHP if Congress does not authorize 
the TRICARE fee increases? Even if Congress was to approve the fees, 
how will the Department cover unanticipated costs if the savings 
estimated from beneficiaries opting out of TRICARE do not materialize 
to the estimated levels?
    General Green. If Congress does not provide us with needed support 
for these proposals, the Department will have to find about $12.9 
billion, the projected five year savings from these proposals, from 
other Defense programs to meet its healthcare obligations. Without 
needed authority, we will face further cuts in forces and investment to 
be consistent with the Budget Control Act. Because our budget proposal 
already makes substantial reductions in the investment accounts, 
further cuts may impact end strength. If, for example, Congress did not 
support any of our proposed TRICARE changes, the Department would have 
to make very difficult choices between further cuts to weapons systems 
or reducing end strength to cover the $12B hole in the budget. Cuts of 
this magnitude would jeopardize our ability to pursue some priorities 
as planned the new defense strategy and force potential cutbacks in 
both direct and private sector care.
                                 ______
                                 
                    QUESTIONS SUBMITTED BY MR. JONES

    Mr. Jones. Medicare pays about 60% and DOD pays 40% of the overall 
TRICARE For Life (TFL) beneficiary costs, does your office have any 
ideas on how to reduce the cost? Have you considered looking at a 
management option for TFL beneficiaries?
    Secretary Woodson. TRICARE for Life provides Medicare wrap-around 
coverage when health care is a benefit under both programs, as long as 
the beneficiary is enrolled in Medicare Part B. Medicare pays 80 
percent of their allowed amount, and claims automatically cross over to 
TRICARE where TRICARE processes the remainder for payment.
    Recently, TRICARE Management Activity staff met with 
representatives from the Centers for Medicare and Medicaid Services' 
(CMS) Innovation Center to discuss the Comprehensive Primary Care 
Initiative that CMS is developing. This initiative will use a managed 
care approach to providing preventive care and disease management for 
Medicare and other patients. It will reward providers when costs are 
reduced as participants in the initiative achieve desired health 
outcomes. Many TFL beneficiaries are likely participants in the 
initiative, and TRICARE intends to monitor progress and results of the 
initiative to assess how and whether to apply the care approach to a 
broader segment of our TFL population.
    We have also instituted new management controls that are applicable 
when TRICARE becomes primary payer for a TFL beneficiary's stay in a 
skilled nursing facility (SNF). This occurs after exhaustion of the 
100-day SNF care coverage provided by Medicare. We have found that 
bills for SNF care are among the largest of any that TFL must cover. 
Now we require that SNF care beyond 100 days be preauthorized, and base 
the decision upon review of medical records to ensure (a) that skilled 
care truly is required and (b) if skilled care is required, that it is 
of such intensity that it cannot be safely provided at a lower, less 
expensive level, than in a SNF.
    Mr. Jones. It is my understanding that DOD proposes to tie the cost 
that the military retiree will pay to a ``means test'' system, meaning 
the greater the annuity that a retiree receives, the more they will pay 
for their health care. As you know, no other Federal retired employee 
healthcare cost is ``means tested.'' Don't you think that this proposed 
system is unfair to our service members and their families who have 
sacrificed so much, especially this last decade?
    Secretary Woodson. Where feasible, the proposed fee increases were 
tiered by military retirement pay, based on the principles of the FY 
2007 Task Force on the Future of Military Medicine. In its 
deliberations, the Task Force recognized that military retirement is 
not like most civilian retirement systems and that the entire military 
compensation system differs from the typical civilian ``salary'' system 
because much of the compensation is ``in-kind'' or ``deferred.'' Thus, 
changes in the healthcare benefit were examined in the context of this 
unique system and its compensation laws, policies, and programs. The 
Task Force believed that, for equity reasons, military retirees who 
earn more military retired pay should pay a higher enrollment fee than 
those who earn less. While this ``tiering'' approach is not commonly 
used in the private sector for enrollment fees, the Task Force believed 
that it made sense in a military environment.
                                 ______
                                 
                  QUESTIONS SUBMITTED BY MS. BORDALLO

    Ms. Bordallo. Do you believe that in this era of declining budgets 
and military end-strength, that the prohibition on converting medical 
military personnel to civilian personnel should be continued?
    Secretary Woodson. No, I do not believe that the prohibition should 
be continued. Given the fiscal and budgetary pressures facing the 
Department and nation, the Department can achieve savings from pursuing 
such conversions. Additionally, with declining end-strengths and 
changing force structures, the Department must do everything it can to 
minimize the utilization of uniformed military personnel in positions 
that are not military essential, or do not require military unique 
knowledge and skills to support readiness or career progression. A 
significant portion of the current medical positions filled by military 
personnel do not meet these criteria and could, and should, be 
considered for conversion to civilian performance (or in certain 
circumstances, private sector performance if appropriate and in 
accordance with statutes). Doing so will not only achieve savings 
associated with lower civilian personnel costs but also free military 
personnel for more pressing needs of the Services and Combatant 
Commanders.
    Ms. Bordallo. How many military medical positions does the 
Department currently have that could potentially be converted to 
civilian performance because military incumbency is not essential?
    Secretary Woodson. The Military Readiness Review (MRR) mandates the 
number of uniformed men and women necessary to deliver military medical 
and health care, and is established to meet service wartime 
requirements and to provide adequate rotational and training 
opportunities in order to maintain required skill levels for 
deployment. The number of military providers above the level dictated 
by the MRR could, and should, be converted to civilian positions (or 
contract if appropriate and in accordance with policies and statutes) 
without degrading either unit readiness or the training and 
deployability of the military member. Prior to the prohibition on 
conversion of such billets, the Department had estimated nearly 17,000 
positions for conversion. Current data points to at least 6,000 medical 
military positions that could potentially be converted to civilian 
performance, at significant savings to the Department and in support of 
the end-strength reductions.
    Ms. Bordallo. Given the opportunity, could the Department save 
money by converting medical military positions to civilian positions?
    Secretary Woodson. Yes, the Department can save money by converting 
medical military positions to civilian performance, or, in certain 
circumstances, private sector performance (if appropriate and in 
accordance with statutes). The Department estimates it could 
potentially save in excess of $1.5 billion over a five year period 
(with savings continuing annually beyond that) by converting military 
medical positions to civilian performance, with no degradation to 
quality of care. This is based on approximately 16,000 military medical 
positions that were slated to be converted prior to the prohibition and 
annual savings of approximately $22,000 per position. In addition to 
these direct savings to the Department, additional government and 
taxpayer savings would be realized by the Departments of Veterans 
Affairs and Treasury by avoiding long-term deferred costs associated 
with military incumbency.
    Ms. Bordallo. Notwithstanding the current congressionally imposed 
prohibition, how could the Department convert medical military 
personnel to civilians given the current mandate across DOD to maintain 
FY10 civilian levels?
    Secretary Woodson. Absent the congressionally mandated prohibition, 
medical military personnel could be converted to civilian personnel by 
absorbing work into existing government positions by refining duties or 
requirements; establishing new positions to perform these medical 
duties by eliminating or shifting equivalent existing manpower 
resources (personnel) from lower priority activities; or requesting an 
exception. Any large-scale conversion of medical military manpower to 
civilian, as originally programmed prior to the congressional 
prohibition on such conversions, would require deviation and an 
exception from the fiscal year 2010 civilian personnel levels the 
Services have been directed to maintain.
    Ms. Bordallo. What instances and requirements would justify 
military incumbency for medical requirements instead of civilian 
performance?
    Secretary Woodson. The primary instance or requirement for military 
incumbency is predicated on the fact that military members have an 
obligation to deploy and medical personnel are a key element of the 
operating forces. They are responsible for providing world class 
medical and health care on the battlefield, referred to as ``Service 
Wartime Requirements''. Additionally, career progression, overseas 
rotation, and military unique skills/knowledge requirements necessitate 
military incumbency outside of these ``Service Wartime Requirements''. 
In order to maintain the necessary level of skills to meet operational, 
mobilization, and wartime requirements, it is critical that military 
medical professionals receive the training and patient load necessary 
to provide experience with current medical scenarios, diagnoses and 
treatments. Maintaining training and rotational practice opportunities 
for military providers is critical to the continued health of the 
Military Health System.
    Ms. Bordallo. How many medical military positions were originally 
slated to be converted to civilian positions prior to the prohibition 
on such?
    Secretary Woodson. The number of medical military positions 
originally slated to be converted, prior to the implementation of the 
congressional mandated prohibition, between fiscal years 2005 and 2013 
was 16,876.
    Ms. Bordallo. Do you believe that medical care for our uniformed 
men and women and unit readiness would suffer if delivered by civilian 
personnel instead of military personnel?
    Secretary Woodson. The Military Readiness Review (MRR) mandates the 
number of uniformed men and women necessary to deliver military medical 
and health care. This number is established to meet service wartime 
requirements and to provide adequate rotational and training 
opportunities in order to maintain required skill levels for 
deployment. I believe that any military medical billets above the level 
dictated by the MRR could, and should, be converted to civilian 
positions (or contract if appropriate and in accordance with policies 
and statutes) without degrading medical care, unit readiness, or the 
training and deployability of the military medical providers.
    Ms. Bordallo. What impact has the civilian cap had on the Defense 
Health Program and ability to deliver care?
    Secretary Woodson. The Military Health System (MHS) draws 
healthcare providers from three different labor sources: active and 
reserve military, government civilian employees, and contracted 
support. Any arbitrary personnel ceiling that limits the Department's 
potential ability to hire civilian employees forces the MHS to increase 
contracted support, both within the military treatment facilities and 
in the local economy. The Department is committed to providing world 
class healthcare to Service members, and that level of healthcare will 
continue regardless of any constrants, but will come a significantly 
higher cost if the MHS is forced to utilize contracted support in lieu 
of government civilians. Such increased costs will impact availability 
of care and the patient share of the cost, and take funding away from 
other pressing medical and health needs of the force, as well as 
reducing available funding for other compelling needs across the 
Department.

    Ms. Bordallo. Do you believe that in this era of declining budgets 
and Army end-strength, that the prohibition on converting medical 
military personnel to civilian personnel should be continued?
    General Horoho. The current congressional prohibition has 
effectively reduced programmatic and operational turmoil to our complex 
medical workforce. Previous rounds of medical military to civilian 
conversion directly impacted Army Medical Department mission 
capabilities to the detriment of medical support to our Soldiers and 
their Families. The inability to backfill military conversions with 
qualified civilians in a timely basis generated shortfalls in the 
delivery of health care, especially in the ancillary workforce required 
to support our physicians and nurses. The Army restored military 
billets converted between FY07-FY11, recognizing the negative effects 
of reduced support staff and resulting decreased clinician efficiency 
and effectiveness which directly impacted quality and access to care.
    Ms. Bordallo. How many military medical positions does the Army 
currently have that could potentially be converted to civilian 
performance because military incumbency is not essential?
    General Horoho. An assessment of military medical billets, 
potential readiness impact, cost, and local market availability is 
necessary to determine if any medical positions could be converted to 
civilian performance. Military to civilian conversion would require the 
programming of additional funding for the required civilian medical 
workforce.
    Ms. Bordallo. Do you believe that medical care for your soldiers 
and unit readiness would suffer if delivered by civilian personnel 
instead of military personnel?
    General Horoho. The Army Medicine Team is composed of a symbiotic 
core of military, civilian and contract healthcare personnel. As an 
Army in persistent conflict for over a decade, we stand shoulder-to-
shoulder with the Warfighter, both on the battlefield and at home. Our 
military healthcare personnel are the critical link between care in the 
garrison environment and on remote battlefields. The combined Army 
Medicine team leverages the strengths, competencies, Duty and Selfless 
Service necessary to ensure a fit and medically ready force.

    Ms. Bordallo. Do you believe that in this era of declining budgets 
and Navy/Marine Corps end-strength, that the prohibition on converting 
medical military personnel to civilian personnel should be continued?
    Admiral Nathan. Military to civilian conversions in the Medical 
Department are often independent of declining budgets and end strength 
reductions. The ideal mix of personnel; active duty, civilians, 
contractors, is established first and foremost to meet operational 
requirements, and then to appropriately augment the team with civilian 
and contractor staff; as is currently done. Uniformed staffing 
requirements are directly linked to the operational needs of the Fleet 
and Fleet Marine Forces. Active duty personnel directly support and 
mobilize, when needed, to meet Combatant Commanders' requirements. 
Civilian and contract staff augment and complete the staffing at our 
fixed military treatment facilities, providing much needed continuity 
of care delivery. As was learned during the last effort of Military-to-
Civilian conversions, ending the prohibition on converting military 
personnel to civilian personnel will not necessarily lead to lower 
costs.
    Ms. Bordallo. How many military medical positions does the Navy/
Marine Corps currently have that could potentially be converted to 
civilian performance because military incumbency is not essential?
    Admiral Nathan. Navy Medicine uses an operational requirements 
model, based on the Combatant Commanders' needs, to determine the 
appropriate, number of uniformed medical department personnel needed to 
ensure that the Navy and Marine Corps missions are met. The total 
number of uniformed personnel within Navy Medicine today is adequate to 
meet currently identified operational requirements. Uniformed personnel 
are allocated to operational units and, when not deployed, are assigned 
to our fixed military treatment facilities. There they hone and sustain 
their needed clinical and ancillary skills in order to prepare for 
their mobilization assignments. The number of medical professionals 
needed to staff these Medical Treatment Facilities, in excess of active 
duty requirements, may be supported by any personnel category 
(military, civilian, or contractor). Navy Medicine's complement of 
total staff, comprising all of these categories is approximately 63,000 
men and women supporting Navy's healthcare missions.
    Ms. Bordallo. Do you believe that medical care for sailors and 
marines, and unit readiness would suffer if delivered by civilian 
personnel instead of military personnel?
    Admiral Nathan. Navy maintains one high standard of health care, 
whether that care is delivered by military or civilian providers. 
Military or civilian providers maintain the same qualifications and 
credentialing standards. Navy Medicine meets the unit readiness and the 
beneficiary peacetime missions while in-garrison, by employing 
available uniformed staff, augmented by civilian and contract providers 
and support staff at our fixed facilities. Civilians delivering care to 
our deployable forces in our fixed Medical Treatment Facilities would 
not degrade unit readiness, so long as a uniformed force is maintained 
at the appropriate levels required to support our operational missions.

    Ms. Bordallo. Do you believe that in this era of declining budgets 
and Air Force end-strength, that the prohibition on converting medical 
military personnel to civilian personnel should be continued?
    General Green. In certain locations, and for certain Air Force 
Specialty Codes, military-to-civilian conversions provide an effective 
option to the Air Force Medical Service for managing costs while 
continuing to deliver outstanding healthcare. The NDAA prohibition 
inhibits the ability to optimize force structure for emerging and 
changing missions and operations tempo by eliminating military to 
civilian/contract conversion options when conversion is deemed the most 
effective and efficient funding source. However, we need to ensure that 
the conversions are in the appropriate market due to the availability 
of civilians with the required skills/training and the potential 
competition and pay disparities with the civilian sector.
    Ms. Bordallo. How many military medical positions does the Air 
Force currently have that could potentially be converted to civilian 
performance because military incumbency is not essential?
    General Green. The Air Force Defense Health Program current 
Critical Operational Readiness Requirement is 25,284 and current active 
duty Defense Health Program end-strength is 31,544. In theory, the Air 
Force could potentially convert approximately 6,200 positions from 
Military to Civilian across the Future Year Defense Plan (Fiscal Year 
14-18) at an estimated rate of 1,240 positions per year.
    Three very important issues that would impact the number of 
conversions would be: 1. In theory, we could covert 6,200 Military to 
Civilian positions; however, we may not be able to execute because of 
the availability of civilians with the required skills/training and the 
potential competition and pay disparities with the civilian sector. 2. 
Currently there are ongoing discussions with Health Affairs and the 
Service Surgeon Generals to develop strategies for determining medical 
requirements and medical force sizing for future contingencies. 3. 
There needs to be consistent civilian pay categories across all 
government pay systems (e.g. DOD, VA, Public Health Service) to 
simplify recruiting and retention of civilians.
    Ms. Bordallo. Do you believe that medical care for airmen and unit 
readiness would suffer if delivered by civilian personnel instead of 
military personnel?
    General Green. The Air Force does not believe that medical care for 
Airmen would suffer if delivered by civilian personnel. The Air Force 
has successfully utilized Active Duty, civilian and contract personnel 
to provide medical care to our active duty population in our Medical 
Treatment Facilities. Unit readiness requires a health system to assist 
commanders' track and resolve health related readiness concerns. Any 
Shift that eliminated the health system from assisting commanders could 
impact readiness.
                                 ______
                                 
                   QUESTION SUBMITTED BY MR. LOEBSACK

    Mr. Loebsack. My understanding is that an announcement was recently 
made about the TRICARE program in the TRICARE West Region. Can you tell 
me what the Department has done to ensure that there will be no 
disruption in care for my constituents or for any TRICARE beneficiaries 
in the region? What has been done to ensure that any changes in the 
TRICARE West Region will not result in a reduction of healthcare 
services available in rural states like Iowa for our service members 
(including in the Reserve Component), retirees, and military families?
    Secretary Woodson. The West contract is under protest and services 
will continue under the old contract until the protest is resolved. 
However, all TRICARE Regional contracts have transition periods as 
required by statute and those transition periods address the transfer 
of responsibility in a timely and orderly fashion. The contracts also 
contain required access standards and networks of adequate size and 
composition to cover all needed services in the Regions. While it 
cannot be guaranteed that all providers currently in the TRIWEST 
network will continue as providers under the new contractor, most will 
be likely retained and beneficiaries will not be without services nor 
should they experience any disruption of service as a result of the 
transition, regardless of the area they live in.

                                  
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