**GAO-08-721R**                      Published: May 28, 2008. Publicly Released: May 28, 2008.                  

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## Highlights

The President's budget request for the Department of Defense's (DOD) Defense Health Program has increased steadily in recent years. For example, from fiscal year 2005 to fiscal year 2009, the budget request for the program increased from about $17.6 billion to about $23.6 billion, an increase of about 34 percent. DOD has attributed a majority of this increase to growth in medical care, dental care, and pharmaceuticals provided in the private sector to active duty personnel and other eligible beneficiaries. These private sector expenses are funded through the Defense Health Program's Private Sector Care Budget Activity Group (BAG). From fiscal year 2005 to fiscal year 2009, the budget request for this BAG increased by about 36 percent--from about $9.0 billion to almost $12.2 billion. The Conference Report accompanying the Fiscal Year 2008 Department of Defense Appropriations bill directed us to review the President's fiscal year 2009 budget request for the Defense Health Program's Private Sector Care BAG. To do this, we reviewed (1) DOD's justification for the request for the Private Sector Care BAG, including the underlying estimates and the extent to which DOD considered historical information; and (2) changes between this request and the request for fiscal year 2008 and factors causing these changes.

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## Topics

Budget and Spending

BeneficiariesBudget functionsBudget obligationsBudget outlaysBudgetingCost analysisCost sharing (finance)Data integrityDefense budgetsDefense capabilitiesHealth care cost controlHealth care costsHealth care programsHealth care servicesManaged health careMilitary health servicesMilitary personnelPresidential budgetsPrivate sectorBudget requestsCost estimatesProgram costs