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The National Defense Authorization Act for Fiscal Year 2013 required that DOD develop a detailed implementation plan for carrying out its health care system reform of creating the DHA, and provide the plan to the congressional defense committees in three separate submissions in fiscal year 2013. In October 2013, DOD established the DHA to assume management responsibility for numerous functions of its medical health care system, support the services in carrying out their medical missions, manage the military s health plan, oversee the medical operations within and provide 10 shared services, including oversight of medical education and training. According to DOD, a shared services concept is a combination of common services performed across the medical community with the goal of achieving cost savings. The DHA s Education and Training Directorate, a shared service, is scheduled to begin operations in August 2014 and, according to DOD officials, when operational, will constitute the first instance of oversight of medical education and training at the Office of the Secretary of Defense level.8 8The DHA and the Education and Training Directorate are expected to reach full operational capability no later than October 1, 2015. While the services establish training requirements, operate their own service-specific training institutions, and provide manpower to conduct the training at tri-service institutions, such as METC, the Directorate plans to provide administrative support; academic review and policy oversight; and professional development, sustainment, and program management to the military departments medical services, the combatant commands, and the Joint Staff. See figure 1 below for the organizational chart of the DHA.

Why GAO Did This Study. In March 2013, DOD s discretionary budget was reduced by $37 billion as a result of sequestration across-theboard spending reductions to enforce certain budget policy goals. In response, the Secretary of Defense implemented an administrative furlough, among other things by placing most of DOD s civilian personnel in a temporary nonduty, nonpay status. An administrative furlough is a planned event by an agency to absorb reductions due to budget situations other than a lapse in appropriations. GAO was mandated to review DOD s implementation of its administrative furlough. This report (1) examined how DOD implemented its furloughs and any reported cost savings, (2) examined the extent to which DOD utilized up-to-date cost-savings information in the planning and implementation of furloughs, and (3) identified any reported examples of impacts that resulted from the furloughs. GAO reviewed DOD furlough guidance, interviewed officials, and conducted visits at selected sites that were selected to represent different categories of furlough exceptions and potential sequestration impacts, among other things. What GAO Recommends. GAO recommends that DOD update and utilize its furlough cost-savings information as it becomes available in the event that it decides to implement another administrative furlough in the future. DOD partially concurred. GAO continues to believe the findings and recommendation are valid, as discussed in the report., Report to Congressional Committees.

DoD's Military Health System (MHS) costs almost $50 billion annually and that amount is expected to grow to $70 billion by 2028. The MHS governance structure has been the subject of many studies, some recommending major changes. In 2006, DoD considered potential governance structure changes but left its existing structure in place, approving instead a shared-services directorate to consolidate common MHS functions (e.g., shared information-technology services) that ultimately was never developed. In 2012, DoD announced the creation of the Defense Health Agency (DHA) by October 1, 2013, which has seven main goals: (1) consolidate functions (shared services) common to DoD, (2) deliver more-integrated health care in areas with more than one military service, (3) establish more-standardized processes, (4) more-closely align financial incentives with health and readiness outcomes, (5) match other resources with missions, (6) deliver more primary care and other health services, and (7) better coordinate care over time and across treatment settings. Section 731 of the National Defense Authorization Act for Fiscal Year 2013 required DoD to provide three submissions in March, June, and September 2013, detailing its plan to reform the MHS. This testimony addresses the additional actions that would increase transparency and enhance accountability of DoD's reform plans. It is based primarily on the following: (1) GAO's November 2013 report that assessed DoD's first two submissions of its reform plans to Congress, and (2) selected updates. For the updates, GAO analyzed DoD's third reform plan and interviewed a DoD representative., Testimony Before the Subcommittee on Military Personnel, Committee on Armed Services, House of Representatives.

The United States and DOD depend on space assets to support national security, civil, and commercial activities. Having sufficient quantities of qualified personnel to acquire space assets on which DOD expects to spend $8 billion in fiscal year 2013 is critical to DOD s ability to carry out its mission. Approximately 1,800 federal civilians at the Air Force SMC manage the acquisition of space systems. During fiscal year 2012, the Air Force implemented a pilot program that moved $187.1 million for SMC's acquisition civilian personnel from its O&M to its RDT&E appropriation. GAO was mandated to review the Air Force pilot program. This report addresses (1) the extent to which the Air Force evaluated the impact of the pilot, and (2) the processes in place to manage realignment of the funds. GAO obtained and reviewed documentation of the pilot implementation; compared the implementation with established practices GAO has identified for implementing and evaluating pilot programs; and interviewed officials at the Air Force and DOD. GAO also reviewed applicable regulations and guidance about realigning funds and interviewed knowledgeable officials. GAO recommends that the Air Force evaluate the pilot program, to determine the impact of moving funding for acquisition civilian personnel to the RDT&E appropriation, and the value of expanding this change to other Air Force civilian workforces. In written comments on a draft of this report, DOD concurred with all four recommendations., Rept. to Congressional Committees

DOD operates a large and complex health care system that employs more than 150,000 military, civilian, and contract personnel working in military treatment facilities. Each military department operates its own facilities, and contracts separately for health care professionals to supplement care provided within these facilities. In fiscal year 2011, these contracts totaled $1.14 billion. In the National Defense Authorization Act for Fiscal Year 2012, Congress mandated that GAO review the military departments acquisition of health care professional services. This report examines (1) the contracting practices used by the departments and their cost effectiveness; (2) the extent to which the departments consolidate health care staffing requirements; (3) the percentage and associated costs of contract health care professionals working at on-base facilities versus off-base; (4) the training requirements for and experience of medical services contracting personnel; and (5) the extent to which the departments policies address legislated quality standards for contract civilian health care professionals and for staffing companies that provide these professionals. To conduct this review, GAO reviewed military health care policies, analyzed DOD s fiscal year 2011 procurement and staffing data, and interviewed DOD military health system officials. GAO recommends that the Secretary of Defense develop a DOD-wide strategic approach to contracting for health care professionals. DOD concurred with the recommendation., Report to Congressional Committees

In response to congressional direction in House Report 112-479, the enclosed briefing provides information on the wage rates of the Department of Defense s (DOD) federal civilian chiropractors compared with the wages of other federal civilian health care professionals within DOD with similar training and education. We provided this briefing to the staff from the Senate and House Committees on Armed Services on February 4, 2013 and January 29, 2013, respectively. We found that DOD employs 90 chiropractors at 62 military treatment facilities as of January 2013. Further, the mean salary of DOD s federal civilian chiropractors is similar to the mean salary of those serving in comparable DOD federal civilian health care occupations. Specifically, we found that the mean salaries of our selected health care professions ranged from approximately $77,000 to approximately $94,000 with the mean salary for chiropractors approximately 7 percent higher than the lowest mean salary and approximately 12 percent lower than the highest mean salary. Although these health care positions have similar education and training requirements, they have some different responsibilities., Briefing to Congressional Staff of House and Senate Committees on Armed Services.

The Department of Veterans Affairs (VA) and the Department of Defense (DoD) operate two of the nation's largest health care systems at estimated annual costs of about $53 billion and $49 billion, respectively, for fiscal year 2013, and have established collaboration sites to deliver care jointly with the aim of improving access, quality, and cost-effectiveness of care. In addition, collaborations could help reduce duplication and overlap between the two health care systems, potentially saving tax dollars and helping VA and DoD provide more efficient and effective services. A committee report accompanying the Consolidated Appropriations Act, 2012, directed GAO to report on aspects of VA and DoD collaboration. This report examines the extent to which the following occur: (1) VA and DoD assess effectiveness and efficiencies at collaboration sites, (2) barriers exist that affect collaboration, and (3) VA and DoD identify opportunities for collaboration. GAO conducted site visits to selected VA and DoD collaboration sites; reviewed VA and DoD documents, such as sharing agreements; and interviewed VA and DoD officials. GAO recommends several actions, including that VA and DoD require collaboration sites to develop performance measures related to access, quality, and costs; address barriers hindering collaboration; and develop a process to more systematically identify new or expanded collaboration opportunities. GAO identified incompatible policies and practices in four areas: information technology (IT) systems, business and administrative processes, access to military bases, and medical facility construction. VA and DoD generally concurred with GAO's recommendations and noted steps they are taking to address them., Report to Congressional Addressees.

Over the past decade, the cost of the Military Health System (MHS) has grown substantially and is projected to reach nearly $95 billion by 2030, according to the Congressional Budget Office. As health care costs consume an increasingly large portion of the defense budget, current DoD leadership and Congress have recognized the need to better control these costs. Section 716 of the National Defense Authorization Act for Fiscal Year 2012 required DoD to submit a report analyzing potential MHS governance options under consideration, and also required GAO to submit an analysis of these options. In response to this mandate, GAO determined the extent to which DoD's assessment provides complete information on cost implications and the strengths and weaknesses of potential MHS governance options. To conduct this review, GAO analyzed DoD's governance report along with supporting documents, and interviewed Task Force members. GAO recommends that DoD develop the following: (1) a comprehensive cost analysis for its potential MHS governance options, (2) a business case analysis and strategy for implementing its shared services concept, and (3) more complete analyses of the options' strengths and weaknesses. DoD concurred with developing a business case analysis for its shared services concept. DoD did not concur with the other two recommendations, stating that further analysis would not alter its conclusions. GAO disagrees and believes that more comprehensive analysis will help to distinguish the differences among the costs and benefits of the options., Report to Congressional Committees.

Since 1997, federal agencies have followed a common set of personnel security investigative standards and adjudicative guidelines for determining whether servicemembers, federal workers, private industry personnel, and others are eligible to receive security clearances. Security clearances are required for access to certain national security information, which is classified at one of three levels: top secret, secret, or confidential. The level of classification denotes the degree of protection required for information and the amount of damage that unauthorized disclosure could reasonably cause to national security. The degrees of expected damage that unauthorized disclosure could reasonably be expected to cause are "exceptionally grave damage" for top secret information, "serious damage" for secret information, and "damage" for confidential information. We have previously reported problems-including significant delays in processing clearances-associated with DOD's security clearance processes, and in 2005, 2007, and again in 2009, we identified not only delays in completing the end-to-end clearance processing but also incomplete investigative and adjudicative reports. More recently, we reported that although the executive branch has met current IRTPA timeliness requirements-under which adjudicative agencies are to make a determination on at least 80 percent of all applications for a security clearance within 120 days, on average, after the date of receipt of the application-executive branch reports to Congress do not capture the full range of time that OPM and DOD took to make clearance determinations.

While DOD has taken some steps to implement internal safeguards to ensure that the NSPS performance management system is fair, effective, and credible, the implementation of some of these safeguards could be improved. Specifically, DOD has taken some steps to (1) involve employees in the system's design and implementation; (2) link employee objectives and the agency's strategic goals and mission; (3) train and retrain employees in the system s operation; (4) provide ongoing performance feedback between supervisors and employees; (5) better link individual pay to performance in an equitable manner; (6) allocate agency resources for the system s design, implementation, and administration; (7) include predecisional internal safeguards to determine whether rating results are consistent, equitable, and nondiscriminatory; (8) provide reasonable transparency of the system and its operation; and (9) impart meaningful distinctions in individual employee performance. For example, all 12 sites we visited trained employees on NSPS, and the DODwide tool used to compose self-assessments links employees objectives to the commands or agencies strategic goals and mission. We believe continued monitoring of all of these safeguards is needed to ensure that DOD's actions are effective as implementation proceeds and more employees become covered by NSPS. We also determined that DOD could immediately improve its implementation of three safeguards: predecisional internal safeguards, reasonable transparency, and meaningful distinctions in employee performance.