a

GAO

United States General Accounting Office

Report to the Chairman, Subcommittee 

on Oversight and Investigations, 

Committee on Veterans’ Affairs, House of 

Representatives

June 2004 COMPUTER-BASED 

PATIENT RECORDS

VA and DOD Efforts to 

Exchange Health Data 

Could Benefit from 

Improved Planning 

and Project 

Management

GAO-04-687
www.gao.gov/cgi-bin/getrpt?GAO-04-687.

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact Linda D. 

Koontz at (202) 512-6240 or 

koontzl@gao.gov. 

Highlights of GAO-04-687, a report to the

Subcommittee on Oversight and 

Investigations, House Committee on 

Veterans' Affairs 

June 2004

COMPUTER-BASED PATIENT RECORDS

VA and DOD Efforts to Exchange Health 

Data Could Benefit from Improved 

Planning and Project Management 

While VA and DOD continue to move forward in agreeing to and adopting 

standards for clinical data, they have made little progress since last winter 

toward defining how they intend to achieve an electronic medical record 

based on the two-way exchange of patient health data. The departments 

continue to face significant challenges in achieving this capability. 

• VA and DOD lack an explicit architecture—a blueprint—that provides 

details on what specific technologies will be used to achieve the 

electronic medical record by the end of 2005. 

• The departments have not fully implemented a project management 

structure that establishes lead decision-making authority and ensures the

necessary day-to-day guidance of and accountability for their investment 

in and implementation of this project.

• They are operating without a project management plan describing the 

specific responsibilities of each department in developing, testing, and 

deploying the electronic interface.

In seeking to provide a two-way exchange of health information between 

their separate health information systems, VA and DOD have chosen a 

complex and challenging approach—one that necessitates the highest levels 

of project discipline. Yet critical project components are currently lacking. 

As such, the departments risk investing in a capability that could fall short of 

what is expected and what is needed. Until a clear approach and sound 

planning are made integral parts of this initiative, concerns about exactly 

what capabilities VA and DOD will achieve—and when—will remain. 

A critical element of the 

Department of Veterans Affairs’ 

(VA) information technology 

program is its continuing work 

with the Department of Defense 

(DOD) to achieve the ability to 

exchange patient health care 

information and create electronic 

medical records for use by 

veterans, active-duty military 

personnel, and their health care 

providers. 

This report provides an assessment 

of the departments’ recent progress 

toward achieving an electronic 

two-way exchange of health care 

data, along with recommendations 

based on GAO’s work. 

To help ensure progress by the 

departments in achieving the twoway exchange of health 

information, GAO recommends 

that the Secretaries of Veterans 

Affairs and Defense develop an 

architecture for the systems’ 

electronic interface, establish a 

project management structure that 

designates a lead decision-making 

entity, and create and implement a 

coordinated project plan for 

developing the interface between 

the departments’ health 

information systems. In 

commenting on a draft of this 

report, the departments agreed 

with our recommendations and 

identified actions planned or 

undertaken to address them. 
Page i GAO-04-687 VA/DOD Health Data Exchange 

Letter 1

Results in Brief 2

Background 3

The Two-Way Exchange Could Benefit from Improved Planning 

and Project Management 6

Conclusions 9

Recommendations for Executive Action 10

Agency Comments 11

Appendix I Comments from the Secretary of Veterans Affairs 12 

Appendix II Comments from the Director, Interagency Program 

Integration & External Liaison for Health Affairs 15 

Contents 

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reproduce this material separately. 
Page 1 GAO-04-687 VA/DOD Health Data Exchange 

June 7, 2004 

The Honorable Steve Buyer 

Chairman, Subcommittee on Oversight 

 and Investigations 

Committee on Veterans’ Affairs 

House of Representatives 

Dear Mr. Chairman: 

As you know, the Departments of Veterans Affairs (VA) and Defense 

(DOD) are currently pursuing the ability to exchange patient health care 

data and create an electronic medical record for veterans and active-duty 

military personnel. While in military status and later as veterans, many 

patients tend to be highly mobile and may have health records residing at 

multiple medical facilities within and outside of the United States. Having 

readily accessible medical data on these individuals is important to 

providing high-quality health care to them and to adjudicating any 

disability claims that they may have. This goal of having electronic medical 

records that display all available clinical information in each department’s 

health information system is a positive and necessary step. However, as 

we have previously reported,1

 the lack of progress the departments have 

made in accomplishing this two-way exchange of health care data raises 

doubts as to when and to what extent a true electronic medical record will 

be achieved. 

As requested, our objective was to assess VA’s and DOD’s recent progress 

toward achieving an electronic two-way exchange of health care data. In 

conducting our work, we analyzed key documentation supporting VA’s 

and DOD’s strategy for developing and implementing the two-way 

electronic exchange of health data. In addition, we reviewed 

documentation to identify the costs incurred by VA and DOD in developing 

technology to support the sharing of health data, including costs for the 

 1

U.S. General Accounting Office, Computer-Based Patient Records: Sound Planning and 

Project Management Are Needed to Achieve a Two-Way Exchange of VA and DOD Health 

Data, GAO-04-402T (Washington, D.C.: March 17, 2004) and Computer-Based Patient 

Records: Short-Term Progress Made, but Much Work Remains to Achieve a Two-Way 

Data Exchange Between VA and DOD Health Systems, GAO-04-271T (Washington, D.C.: 

November 19, 2003). 

United States General Accounting Office 

Washington, DC 20548 
Page 2 GAO-04-687 VA/DOD Health Data Exchange 

Government Computer-Based Patient Record/Federal Health Information 

Exchange (GCPR/FHIE) initiatives, DOD’s Composite Health Care System 

II, and VA’s HealtheVet VistA. We did not audit the reported costs, and 

thus, cannot attest to their accuracy or completeness. We supplemented 

our analyses with interviews of VA and DOD officials responsible for key 

decisions and actions on the initiatives. Our work was performed at VA 

and DOD offices located in the Washington, D.C., area in accordance with 

generally accepted government auditing standards, from December 2003 

to May of this year. 

While VA and DOD have continued to define data standards that are 

essential to facilitating the exchange of data, they have made little 

progress toward defining just how they intend to achieve the two-way 

exchange of patient health data between their two health information 

systems currently under development. Although VA officials recognize the 

importance of having an architecture that describes in detail how they 

plan to develop an electronic interface between those systems, they 

acknowledge that the departments’ efforts continue to be guided by a less 

specific, high-level strategy that has been in place since September 2002. 

Compounding the challenge and uncertainties of developing the electronic 

interface is that VA and DOD have not fully established a project 

management structure to ensure the necessary day-to-day guidance of and 

accountability for the departments’ investment in and implementation of 

this capability. Although maintaining that they were collaborating on this 

initiative through a joint working group and receiving oversight from 

executive-level councils, neither department has the authority to make 

final project decisions binding on the other. Further, the departments are 

operating without a project management plan describing the specific 

responsibilities of VA and DOD in developing, testing, and deploying the 

interface. In the absence of an explicit architecture and critical project 

management, VA and DOD are progressing slowly in their development of 

the interface and their limited progress to date calls into question the 

departments’ ability to begin exchanging patient health information by 

their targeted date of the end of 2005. 

Given the implications that readily accessible medical data can have for 

improving the quality of health care and disability claims processing for 

military members and veterans, we are recommending that the Secretaries 

of Veterans Affairs and Defense take a number of actions to improve the 

likelihood of successfully achieving the two-way exchange of medical 

data. 

Results in Brief 
Page 3 GAO-04-687 VA/DOD Health Data Exchange 

In commenting on a draft of this report, the Secretary of Veterans Affairs 

and DOD’s Interagency Program Integration and External Liaison for 

Health Affairs agreed with the report’s recommendations. In their 

comments, they provided information on actions planned or undertaken to 

improve program management. 

Since 1998 VA and DOD have been trying to achieve the capability to share 

patient health care data electronically. The original effort—the 

government computer-based patient record (GCPR) project—included the 

Indian Health Service (IHS) and was envisioned as an electronic interface 

that would allow physicians and other authorized users at VA, DOD, and 

IHS health facilities to access data from any of the other agencies’ health 

information systems. The interface was expected to compile requested 

patient information in a virtual record that could be displayed on a user’s 

computer screen. 

Our prior reviews of the GCPR project determined that the lack of a lead 

entity, clear mission, and detailed planning to achieve that mission made it 

difficult to monitor progress, identify project risks, and develop 

appropriate contingency plans. Accordingly, reporting on this project2

 in 

April 2001 and again in June 2002, we made several recommendations to 

help strengthen the management and oversight of GCPR. Specifically, in 

2001 we recommended that the participating agencies (1) designate a lead 

entity with final decision-making authority and establish a clear line of 

authority for the GCPR project, and (2) create comprehensive and 

coordinated plans that included an agreed-upon mission and clear goals, 

objectives, and performance measures, to ensure that the agencies could 

share comprehensive, meaningful, accurate, and secure patient health care 

data. In 2002, we recommended that the participating agencies revise the 

original goals and objectives of the project to align with their current 

strategy, commit the executive support necessary to adequately manage 

the project, and ensure that it followed sound project management 

principles. VA and DOD took specific measures in response to our 

recommendations for enhancing overall management and accountability 

of the project. 

 2

U.S. General Accounting Office, Veterans Affairs: Sustained Management Attention Is 

Key to Achieving Information Technology Results, GAO-02-703 (Washington, D.C.: June 

12, 2002) and Computer-Based Patient Records: Better Planning and Oversight By VA, 

DOD, and IHS Would Enhance Health Data Sharing, GAO-01-459 (Washington, D.C.: April 

30, 2001). 

Background 
Page 4 GAO-04-687 VA/DOD Health Data Exchange 

By July 2002, VA and DOD had revised their strategy and had made some 

progress toward electronically sharing patient health data. The two 

departments had renamed the project the Federal Health Information 

Exchange (FHIE) program and, consistent with our prior 

recommendation, had finalized a memorandum of agreement designating 

VA as the lead entity for implementing the program. This agreement also 

established FHIE as a joint effort that would allow the exchange of health 

care information in two phases. The first phase, completed in mid-July 

2002, enabled the one-way transfer of data from DOD’s existing health 

information system to a separate database that VA clinicians could access. 

A second phase, finalized this past March, completed VA’s and DOD’s 

efforts to add to the base of patient health information available to VA 

clinicians via this one-way sharing capability. The departments reported 

total GCPR/FHIE costs of about $85 million through fiscal year 2003. 

The revised strategy also envisioned the pursuit of a longer term, two-way 

exchange of health information between DOD and VA.3

 Known as 

HealthePeople (Federal), this initiative is premised upon the departments’ 

development of a common health information architecture comprising 

standardized data, communications, security, and high-performance health 

information systems. The joint effort is expected to result in the secured 

sharing of health data required by VA’s and DOD’s health care providers 

between systems that each department is currently developing—DOD’s 

Composite Health Care System (CHCS) II and VA’s HealtheVet VistA. 

DOD began developing CHCS II in 1997 and has completed the 

development of its associated clinical data repository—a key component 

for the planned electronic interface. The department expects to complete 

deployment of all of its major system capabilities by September 2008.4

 It 

reported expenditures of about $464 million for the system through fiscal 

year 2003. VA began work on HealtheVet VistA and its associated health 

data repository in 2001, and expects to complete all six initiatives 

 3

IHS, was not included in FHIE, but was expected to assume a role in the longer-term 

project------HealthePeople (Federal). 

4

DOD’s CHCS II capabilities are being deployed in blocks. Block 1 provides a graphical user 

interface for clinical outpatient processes; block 2 supports general dentistry; block 3 

provides pharmacy, laboratory, radiology, and immunizations capabilities; block 4 provides 

inpatient and scheduling capabilities; and block 5 will provide additional capabilities as 

defined. 
Page 5 GAO-04-687 VA/DOD Health Data Exchange 

comprising this system in 2012.5 VA reported spending about $120 million 

on HealtheVet VistA through fiscal year 2003. 

Under the HealthePeople (Federal) initiative, VA and DOD envision that, 

upon entering military service, a health record for the service member will 

be created and stored in DOD’s CHCS II clinical data repository. The 

record will be updated as the service member receives medical care. When 

the individual separates from active duty and, if eligible, seeks medical 

care at a VA facility, VA will then create a medical record for the 

individual, which will be stored in its health data repository. Upon viewing 

the medical record, the VA clinician would be alerted and provided access 

to the individual’s clinical information residing in DOD’s repository. In the 

same manner, when a veteran seeks medical care at a military treatment 

facility, the attending DOD clinician would be alerted and provided with 

access to the health information in VA’s repository. According to the 

departments, this planned approach would make virtual medical records 

displaying all available patient health information from the two 

repositories accessible to both departments’ clinicians. VA officials have 

stated that they anticipate being able to exchange some degree of health 

information through an interface of their health data repository with 

DOD’s clinical data repository by the end of calendar year 2005. 

 5

The six initiatives that make up HealtheVet VistA are health data repository, billing 

replacement, laboratory, pharmacy, imaging, and appointment scheduling replacement. 
Page 6 GAO-04-687 VA/DOD Health Data Exchange 

While VA and DOD are making progress in agreeing to and adopting 

standards for clinical data,6

 they continue to face significant challenges in 

providing a virtual medical record based on the two-way exchange of data 

as part of their HealthePeople (Federal) initiative. Specifically, VA and 

DOD do not have 

• an explicit architecture that provides details on what specific technologies 

they will use to achieve the exchange capability; 

• a fully established project management structure that will ensure the 

necessary day-to-day guidance of and accountability for the departments’ 

investment in and implementation of the exchange; and 

• a project management plan describing the specific responsibilities of each 

department in developing, testing, and deploying the interface and 

addressing security requirements. 

VA’s and DOD’s ability to exchange data between their separate health 

information systems is crucial to achieving the goals of HealthePeople 

(Federal). Yet, successfully sharing health data between the departments 

via a secure electronic interface between each of their data repositories 

can be complex and challenging, and depends significantly on the 

departments’ having a clearly articulated architecture, or blueprint, 

defining how specific technologies will be used to achieve the interface. 

Developing, maintaining, and using an architecture is a best practice in 

engineering information systems and other technological solutions. An 

architecture would articulate, for example, the system requirements and 

design specifications, database descriptions, and software descriptions 

that define the manner in which the departments will electronically store, 

update, and transmit their data. 

VA and DOD lack an explicit architecture that provides details on what 

specific technologies they will use to achieve the exchange capability, or 

 6

Standardized clinical data is important for exchanging health information between 

disparate systems. The Institute of Medicine’s Committee on Data Standards for Patient 

Safety has reported the lack of common data standards as a key factor preventing 

information sharing within the health care industry. VA and DOD, along with the 

Department of Health and Human Services, have been active participants in the 

Consolidated Health Informatics initiative. As part of this initiative, the Secretary of Health 

and Human Services announced in early May the adoption of 15 new standards to enable 

the exchange of health information. 

The Two-Way 

Exchange Could 

Benefit from 

Improved Planning 

and Project 

Management 

System Architecture Not 

Developed 
Page 7 GAO-04-687 VA/DOD Health Data Exchange 

just what they will be able to exchange by the end of 2005—their projected 

date for having this capability operational. While VA officials stated that 

they recognize the importance of a clearly defined architecture, they 

acknowledged that the departments’ actions were continuing to be driven 

by the less specific, high-level strategy that has been in place since 

September 2002. 

Officials in both departments stated that a planned pharmacy prototype 

initiative, begun this past March in response to requirements of the 

National Defense Authorization Act of 2003,7

 would assist them in defining 

the electronic interface technology needed to exchange patient health 

information. The act mandated that VA and DOD develop a real-time 

interface, data exchange, and capability to check prescription drug data 

for outpatients by October 1, 2004. In late February, VA hired a contractor 

to develop the planned prototype but the departments had not yet fully 

determined the approach or requirements for it. DOD officials stated that 

the contractor was expected to more fully define the technical 

requirements for the prototype. In late April, the departments reported 

approval of the contractor’s requirements and technical design for the 

prototype. 

While the pharmacy prototype may help define a technical solution for the 

two-way exchange of health information between the two departments’ 

existing systems, there is no assurance that this same solution can be used 

to interface the new systems under development. Because the 

departments’ new health information systems—major components of 

HealthePeople (Federal)—are scheduled for completion over the next 4 to 

9 years, the prototype may only test the ability to exchange data in VA’s 

and DOD’s existing health systems. Thus, given the uncertainties regarding 

what capabilities the pharmacy prototype will demonstrate, it is difficult to 

predict how or whether the prototype initiative will contribute to defining 

the architecture and technological solution for the two-way exchange of 

patient health information for the HealthePeople (Federal) initiative. 

 7

Sec. 724 of the act mandates that the Secretaries of Veterans Affairs and Defense seek to 

ensure that, on or before October 1, 2004, the two departments’ pharmacy data systems are 

interoperable for VA and DOD beneficiaries by achieving real-time interface, data 

exchange, and checking of prescription drug data of outpatients, and using national 

standards for the exchange of outpatient medication information. The act further states 

that if the specified interoperability is not achieved by that date, the Secretary of Veterans 

Affairs shall adopt DOD’s Pharmacy Data Transaction System for VA’s use. 
Page 8 GAO-04-687 VA/DOD Health Data Exchange 

Industry best practices and information technology project management 

principles stress the importance of accountability and sound planning for 

any project, particularly an interagency effort of the magnitude and 

complexity of HealthePeople (Federal). Based on our past work, we have 

found that a project management structure should establish relationships 

between managing entities with each entity’s roles and responsibilities 

clearly articulated.8

 Further, it is important to establish final decisionmaking authority with one entity. 

However, VA and DOD have not fully established a project management 

structure that will ensure the necessary day-to-day guidance of and 

accountability for the departments’ investment in and implementation of 

the two-way capability. According to officials in both departments a joint 

working group and oversight by the Joint Executive Council and VA/DOD 

Health Executive Council has provided the collaboration necessary for 

HealthePeople (Federal).9

 However, this oversight by the executive 

councils is at a very high level, occurs either bimonthly or quarterly, and 

encompasses all of the joint coordination and sharing efforts for health 

services and resources. Since a lead entity has not been designated, 

neither department has had the authority to make final project decisions 

binding on the other. Further, the roles and responsibilities for each 

department have not been clearly articulated. Without a clearly defined 

project management structure, accountability and a means to monitor 

progress are difficult to establish. 

In early March, VA officials stated that the departments had designated a 

program manager for the planned pharmacy prototype and were 

establishing roles and responsibilities for managing the joint initiative to 

develop an electronic interface. Just this month, officials from both 

departments told us that this individual would be the program manager for 

the electronic interface. However, they had not yet designated a lead entity 

 8

GAO-01-459. 

9

The Joint Executive Council is comprised of the Deputy Secretary of Veterans Affairs, the 

Under Secretary of Defense for Personnel and Readiness, and the cochairs of joint councils 

on health, benefits, and capital planning. The council meets on a quarterly basis to 

recommend strategic direction of joint coordination and sharing efforts. The VA/DOD 

Health Executive Council is comprised of senior leaders from VA and DOD, who work to 

institutionalize sharing and collaboration of health services and resources. The council is 

cochaired by the VA Under Secretary for Health and DOD Assistant Secretary of Defense 

for Health Affairs, and meets on a bimonthly basis. 

Fully Established Project 

Management Structure Not 

in Place 
Page 9 GAO-04-687 VA/DOD Health Data Exchange 

or provided documentation for the project management structure or their 

roles and responsibilities for the HealthePeople (Federal) initiative. 

An equally important component necessary for guiding the development of 

the electronic interface is a project management plan. Information 

technology project management principles and industry best practices10

emphasize that a project management plan is needed to define the 

technical and managerial processes necessary to satisfy project 

requirements. Specifically, the plan should include, among other things, 

the authority and responsibility of each organizational unit; a work 

breakdown structure for all of the tasks to be performed in developing, 

testing, and deploying the software, along with schedules associated with 

the tasks; and a security policy. 

However, the departments are currently operating without a project 

management plan for HealthePeople (Federal) that describes the specific 

responsibilities of each department in developing, testing, and deploying 

the interface and addressing security requirements. This month, officials 

from both departments stated that a pharmacy prototype project 

management plan that includes a work breakdown structure and schedule 

was developed in mid-March. They further stated that a work group that 

reports to the integrated project team has been given responsibility for the 

development of security and information assurance provisions. While 

these actions should prove useful in guiding the development of the 

prototype, they do not address the larger issue of how the departments 

will develop and implement an interface to exchange health care 

information between their systems by 2005. 

Without a project management plan, VA and DOD lack assurance that they 

can successfully develop and implement an electronic interface and the 

associated capability for exchanging health information within the time 

frames that they have established. VA and DOD officials stated that they 

have begun discussions to establish an overall project plan. 

Achieving an electronic interface that will enable VA and DOD to 

exchange patient medical records is an important goal, with substantial 

 10Institute of Electrical and Electronics Engineers, IEEE/EIA Guide for Information 

Technology (IEEE/EIA 12207.1 - 1997), April 1998. 

Project Management Plan 

Lacking 

Conclusions 
Page 10 GAO-04-687 VA/DOD Health Data Exchange 

implications for improving the quality of health care and disability claims 

processing for the nation’s military members and veterans. In seeking a 

virtual medical record based on the two-way exchange of data between 

their separate health information systems, VA and DOD have chosen a 

complex and challenging approach that necessitates the highest levels of 

project discipline, including a well-defined architecture for describing the 

interface for a common health information exchange; an established 

project management structure to guide the investment in and 

implementation of this electronic capability; and a project management 

plan that defines the technical and managerial processes necessary to 

satisfy project requirements. These critical components are currently 

lacking; thus, the departments risk investing in a capability that could fall 

short of expectations. The continued absence of these components 

elevates concerns about exactly what capabilities VA and DOD will 

achieve—and when. 

To encourage significant progress on achieving the two-way exchange of 

health information, we recommend that the Secretaries of Veterans Affairs 

and Defense instruct the Acting Chief Information Officer for Health and 

the Chief Information Officer for the Military Health System, respectively, 

to 

• develop an architecture for the electronic interface between their health 

systems that includes system requirements, design specifications, and 

software descriptions; 

• select a lead entity with final decision-making authority for the initiative; 

• establish a project management structure to provide day-to-day guidance 

of and accountability for their investments in and implementation of the 

interface capability; and 

• create and implement a comprehensive and coordinated project 

management plan for the electronic interface that defines the technical 

and managerial processes necessary to satisfy project requirements and 

includes (1) the authority and responsibility of each organizational unit; 

(2) a work breakdown structure for all of the tasks to be performed in 

developing, testing, and implementing the software, along with schedules 

associated with the tasks; and (3) a security policy. 

Recommendations for 

Executive Action 
Page 11 GAO-04-687 VA/DOD Health Data Exchange 

The Secretary of Veterans Affairs provided written comments on a draft of 

this report and we received comments via e-mail from DOD’s Interagency 

Program Integration and External Liaison for Health Affairs; both 

concurred with the recommendations. Each department’s comments are 

reprinted in their entirety as appendixes I and II, respectively. In their 

comments, the officials also provided information on actions taken or 

underway that, in their view, address our recommendations. 

We are sending copies of this report to the Secretaries of Veterans Affairs 

and Defense and to the Director, Office of Management and Budget. 

Copies will also be available at no charge on GAO’s Web site at 

www.gao.gov. 

Should you have any question on matters contained in this report, please 

contact me at (202) 512-6240, or Barbara Oliver, Assistant Director, at 

(202) 512-9396. We can also be reached by e-mail at koontzl@gao.gov and 

oliverb@gao.gov, respectively. Other key contributors to this report were 

Michael P. Fruitman, Valerie C. Melvin, J. Michael Resser, and Eric L. 

Trout. 

Sincerely yours, 

Linda D. Koontz 

Director, Information Management Issues 

Agency Comments 
Appendix I: Comments from the Secretary of 

Veterans Affairs 

Page 12 GAO-04-687 VA/DOD Health Data Exchange 

Appendix I: Comments from the Secretary of 

Veterans Affairs 
Appendix I: Comments from the Secretary of 

Veterans Affairs 

Page 13 GAO-04-687 VA/DOD Health Data Exchange 
Appendix I: Comments from the Secretary of 

Veterans Affairs 

Page 14 GAO-04-687 VA/DOD Health Data Exchange 
Appendix II: Comments from the Director, 

Interagency Program Integration & External 

Liaison for Health Affairs 

Page 15 GAO-04-687 VA/DOD Health Data Exchange 

Appendix II: Comments from the Director, 

Interagency Program Integration & External 

Liaison for Health Affairs 

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