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This week, AUSN received a Military Health Service (MHS) Report to Congress, attached below as a PDF, regarding the transition to the new Defense Health Agency (DHA).  In an attempt to curb the ballooning costs of health care in the Armed Services (from $19 billion in 2001 to $49 billion in 2011 and an expected $95 billion by 2030), the Department of Defense (DOD) is transitioning the current Military Health Service (MHS) to a Defense Health Agency (DHA).  The transition reorganizes the Office of the Assistant Secretary of Defense (Health Affairs) and creates a new 3-Star managed DHA (to be appointed no later than 1 July 2013), reconfigures the management of five of the MHS’s largest multi-Service markets (San Antonia, TX; Colorado Springs, CO; Puget Sound, WA; Tidewater, VA and the entire state of Hawaii), transitions the Joint Task Force (JTF) on Capital Medicine to a Directorate within the DHA and stands-down the TRICARE Management Activity (TMA).  The move emphasizes the incredibly elevated costs of health care and DOD’s priority of alleviating the burden.  It also underlines the fact that after 12 years of joint war fighting, military branches have never been more aligned and unified.  Much like the new “Joint-Bases” being created throughout the country, DOD is preparing to employ a health agency able to ensure its long term viability through built in costs savings.

Many throughout the Veteran Service Organization (VSO) community, including AUSN and other members of The Military Coalition (TMC), fear that much of the “plan for reform of the Administration of the Military Health System” is counterproductive to the stated goal.  In the report to Congress on MHS plan, noted in this past years’ Fiscal Year 2013 (FY13) National Defense Authorization Act (NDAA), Sec. 731, MHS stated in the “Objectives of Reorganization” section the biggest fear amongst VSO’s.  Its exact wording reads as follows:

“Our overarching strategic goal – to achieve greater system integration– is supported by seven subordinate objectives that can best be achieved by re-engineering how we do business. We will also improve governance to ensure unity of purpose and shared pursuit of performance goals. The specific changes to the design of the system along with enhanced accountability will enable continuous performance improvement and reduce the projected cost growth of the Defense Health Program (DHP).  As we develop our business case analyses for each change, we will add new measures, or refine existing measures to ensure we are tracking the achievement of our stated goal and the objectives listed below;

1.) Promote more effective and efficient health care operations through enhanced enterprise-wide shared services.

2.) Deliver more comprehensive primary care and integrated health services using advanced patient-centered medical homes.
3.) Coordinate care over time and across treatment settings to improve outcomes in the management of chronic illness, particularly for patients with complex medical and social problems.

4.) Match personnel, infrastructure, and funding to current missions, future missions and population demand.  
5.) Establish more inter-Service standards / metrics, and standardize processes to promote learning and continuous improvement.

6.) Create enhanced value in military medical markets using an integrated approach specified in five-year business performance plans. 

7.) Align incentives with health and readiness outcomes to reward value creation.”

Objectives 4, 5 and 6 seem, to many, to be adding to, not cutting, the costs of health care by adding bureaucracy.   In a March 2012 memorandum on the governance of MHS, the Deputy Secretary of Defense (DEPSECDEF) noted that there are, “opportunities to realize savings in the MHS through the adoption of common clinical and business processes and the consolidation and standardization of various shared services.”  To achieve these outcomes, DEPSECDEF directed the establishment of a Defense Health Agency (DHA), noted in last year’s brief, which will assume responsibility for enterprise-wide shared services, activities and functions of the MHS.  The DEPSECDEF also directed the establishment of enhanced governance and five year business performance plans in major markets to optimize resources and delivery of care across time and treatment sites, within specific geographical areas.

BY 1 July 2013, “Five Year Enhanced Multi-Service Market (E-MSM) Business Plans” are expected to be completed for each of the five regions noted above.  The performance plans will specify how improvements in clinical and business practices will result in cost reduction.  Worrying many throughout the VSO community is the other cuts these plans were directed to identify, namely infrastructure and personnel reductions.       

Please continue to contact your Representatives and Senators and voice your concerns by using our Contact Congress feature and help get the word out.  This is an ALL HANDS ON DECK effort and your grassroots advocacy will help make the changes that need to happen!

Posted in: Capitol Hill Blog

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