United States Government Accountability Office

GAO Report to Congressional Committees

VA AND DOD 

HEALTH CARE 

Opportunities to 

Maximize Resource 

Sharing Remain 

March 2006 

 

GAO-06-315
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

March 2006

VA AND DOD HEALTH CARE 

Opportunities to Maximize Resource 

Highlights of GAO-06-315, a report to Sharing Remain 

congressional committees 

The National Defense 

Authorization Act for Fiscal 

Year 2003 required that the 

Departments of Veterans Affairs 

(VA) and Defense (DOD)

implement programs referred to as

the Joint Incentive Fund (JIF) and 

the Demonstration Site Selection

(DSS) to increase health care

resource sharing between the 

departments. The act requires 

GAO to report on (1) VA’s and

DOD’s progress in implementing 

the programs. GAO also agreed

with the committees of jurisdiction

to report on (2) the actions taken 

by VA and DOD to strengthen 

resource sharing and opportunities 

to improve upon those actions and

(3) whether VA and DOD 

performance measures are useful 

for evaluating progress toward

achieving health care resourcesharing goals.

What GAO Recommends

The Secretaries of VA and DOD 

should (1) develop an evaluation 

plan for documenting and 

recording the advantages and 

disadvantages of each DSS project, 

an activity that will assist VA and 

DOD in replicating successful

projects systemwide, and 

(2) develop performance measures 

that would be useful for

determining the progress of their 

health care resource-sharing goals. 

VA and DOD concurred with GAO’s 

recommendations. 

VA and DOD are making progress in implementing two programs required by 

legislation in December 2002 to encourage health care resource sharing and 

collaboration—JIF and DSS. While JIF projects experienced challenges 

because of delays resulting from the initial absence of funding mechanisms 

and, in some cases, the need for additional acquisition and construction 

approvals, as of December 2005, 7 of 11 selected 2004 projects were 

operational. The DSS program also experienced challenges as some sites 

reported difficulty putting together project submission packages, noting 

confusion over the timelines and approval process as well as frustration with 

the amount of paperwork and rework required. Nonetheless, as of December 

2005, 7 of the 8 DSS projects were operational. However, the Joint Executive

Council (JEC) and Health Executive Council (HEC), VA and DOD entities 

established to facilitate collaboration and health care resource sharing 

between the departments, have not established a plan to measure and 

evaluate the advantages and disadvantages of DSS projects—information 

that will be useful for determining if projects that produce cost savings or 

enhance health care delivery efficiencies can be replicated systemwide. 

VA and DOD are creating mechanisms that support the potential to increase 

collaboration, sharing, and coordination of management and oversight of 

health care resources and services. The departments have taken steps to 

create interagency councils and workgroups to facilitate collaboration and 

sharing of information, establish working relationships among their leaders, 

and develop communication channels to further health care resource 

sharing. In addition, the departments developed a Joint Strategic Plan 

outlining six goals. However, JEC and HEC have not seized upon a number 

of opportunities to further collaboration and coordination. For example, JEC 

and HEC have not developed a system for collecting and monitoring 

information on the health care services that each department contracts for 

from the private sector—such as individual VA medical center or military 

treatment facility contracts for dialysis, laboratory services, or magnetic

resonance imaging. If such a system were in place, the departments could 

use it to identify services that could be exchanged from one another or 

possibly obtain better contract pricing through joint purchasing of services, 

thus promoting systemwide cost savings and efficiencies. Furthermore, JEC 

and HEC have not directed that a joint nationwide market analysis be

conducted to obtain information on what their combined future workloads 

will be in the areas of services, facilities, and patient needs. 

VA and DOD lack performance measures that would be useful for evaluating 

how well they are achieving their health care resource-sharing goals. For 

example, of the 30 measures contained in the departments’ joint strategic 

plan, 5 were not developed at the time the plan was issued and 11 lacked 

longitudinal information. For the remaining 14 that require periodic 

measurement, there was variation in the rigor or specificity in the types of 

data to be collected or the analysis to be performed. 

www.gao.gov/cgi-bin/getrpt?GAO-06-315.

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact Laurie Ekstrand 

at (202) 512-7101 or ekstrandl@gao.gov. 
Contents 

Letter 1

Results in Brief 3 

Background 5

Although JIF and DSS Programs Experienced Start-up Challenges, 

More Than Half of the Projects Are Operational 10 

VA and DOD Have Taken Actions to Strengthen Health Care 

Resource Sharing, but Important Opportunities Remain 18 

VA and DOD Lack Useful Performance Measures to Evaluate

Health Care Resource Sharing 28 

Conclusions 29

Recommendations for Executive Action 30 

Agency Comments and Our Evaluation 30 

Appendix I Scope and Methodology 33 

Appendix II Joint Incentive Fund Program 35 

Appendix III Demonstration Site Selection Projects for Fiscal 

Years 2003 through 2007 39 

Appendix IV Description of VA’s and DOD’s Councils, Committees, 

and Workgroups 43 

Appendix V Comments from the Department of Veterans Affairs 47 

Appendix VI Comments from the Department of Defense 49 

Related GAO Products 53 

Page i GAO-06-315 VA and DOD Health Care Resource Sharing 
Tables 

Table 1: JIF Program Funding 13 

Table 2: DSS Program Funding 16 

Figures 

Figure 1: JIF Program Implementation Timeline 12 

Figure 2: DSS Program Implementation Timeline 18 

Figure 3: VA/DOD JEC Organizational Chart, as of October 2005 20 

Page ii GAO-06-315 VA and DOD Health Care Resource Sharing 
Abbreviations 

BEC Benefits Executive Council 

BHIE Bidirectional Health Information Exchange 

BRAC base realignment and closure 

CARES Capital Asset Realignment for Enhanced Services

CCQAS Centralized Credentials Quality Assurance System

CHCS I Composite Health Care System I 

CHCS II Composite Health Care System II (renamed the Armed 

 Forces Health Longitudinal Technology Application in 

 November 2005) 

CMAC Civilian Health and Medical Program of the Uniformed 

 Services (CHAMPUS) Maximum Allowable Charge 

CPC VA/DOD Construction Planning Committee 

DOD Department of Defense 

DSS Demonstration Site Selection 

GME graduate medical education 

GPRA Government Performance and Results Act of 1993

HEC Health Executive Council

JEC Joint Executive Council

JIF Joint Incentive Fund 

LDSI Laboratory Data Sharing Initiative 

MRI magnetic resonance imaging 

MTF military treatment facility 

NDAA National Defense Authorization Act for Fiscal Year 2003 

OMB Office of Management and Budget 

PMA President’s Management Agenda 

VA Department of Veterans Affairs 

VAMC VA medical center 

VISTA Veterans Health Information Systems and Technology 

 Architecture 

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Page iii GAO-06-315 VA and DOD Health Care Resource Sharing 
United States Government Accountability Office

Washington, DC 20548 

March 20, 2006 

Congressional Committees 

Combined, the Department of Veterans Affairs (VA) and Department of 

Defense (DOD) provided health care services to about 13.5 million 

beneficiaries in fiscal year 2004 at a cost of about $57 billion—$26.8 billion 

for VA and $30.4 billion for DOD.1

 For decades the Congress has 

encouraged VA and DOD to increase their resource-sharing activities to 

achieve the most cost-effective use of health care resources and deliver 

health care services more efficiently. Further, the President’s Management 

Agenda (PMA) contains an initiative that specifically focuses on improving 

coordination of VA and DOD programs and systems by increasing the 

sharing of services that will lead to reduced cost and increased quality of 

care. 

The Congress included in the National Defense Authorization Act for 

Fiscal Year 2003 (NDAA) a provision that VA and DOD implement two 

programs—the joint incentive program2

 and the demonstration program3—

to increase the amount of health care resource sharing taking place 

between VA and DOD. In addition, the act required that we report on VA 

and DOD’s progress in implementing the programs and, as agreed with the 

committees of jurisdiction, the extent projects funded under the programs 

 1

VA provided health care to an estimated 5.2 million of its 7.4 million enrolled beneficiaries 

in fiscal year 2004. DOD provided health care to approximately 8.3 million of the estimated 

9.2 million beneficiaries who were eligible for DOD health care in fiscal year 2004.

2

Bob Stump National Defense Authorization Act for Fiscal Year 2003, Pub. L. No. 107-314, § 

721, 116 Stat. 2458, 2589-95, required VA and DOD to establish a joint incentive program to

identify and provide incentives to implement, fund, and evaluate creative health care 

coordination and sharing initiatives between VA and DOD. VA and DOD refer to this 

program as the Joint Incentive Fund program. 

3

Bob Stump National Defense Authorization Act for Fiscal Year 2003, Pub. L. No. 107-314, § 

722, 116 Stat. 2458, 2595-99, required VA and DOD to establish the Health Care Resources 

Sharing and Coordination Project to serve as a test for evaluating the feasibility, 

advantages, and disadvantages of programs designed to improve the sharing and 

coordination of health care resources between VA and DOD. VA and DOD refer to this

program as the Demonstration Site Selection program.

Page 1 GAO-06-315 VA and DOD Health Care Resource Sharing 
are operational.4

 Further, the committees of jurisdiction asked us to 

describe the actions taken by VA and DOD to strengthen the sharing of 

health care resources between the two departments and opportunities to 

improve upon these actions as well as to assess whether VA and DOD 

performance measures are useful for evaluating progress toward achieving 

health care resource-sharing goals. 

To assess VA’s and DOD’s progress in implementing the Joint Incentive 

Fund (JIF) and Demonstration Site Selection (DSS) programs, we 

conducted site visits at six project sites and interviewed department 

officials responsible for the development of each of the projects.5

 In 

addition, we contacted VA and DOD officials from seven additional sites.6

For all of the sites, we reviewed project documentation for JIF projects 

selected in fiscal year 2004 and DSS projects that consisted of a detailed 

description of the project, a timeline for development and implementation, 

associated risks, costs, potential cost savings (if applicable), staffing 

requirements, and quarterly progress reports for each project.7

To obtain information on the actions taken by VA and DOD to strengthen 

the sharing of health care resources, we spoke with officials from VA’s 

Office of Policy, Planning, and Preparedness and the Veterans Health 

Administration—including the VA/DOD Liaison Office and VA medical 

center (VAMC) staff at several locations engaged in the sharing of health

care resources. We interviewed officials from DOD’s TRICARE 

Management Activity;8

 the DOD/VA Program Coordination Office; the 

 4

We have previously reported on the Joint Incentive Fund program in fiscal years 2004 and 

2005. See GAO, DOD and VA Health Care: Incentives Program for Sharing Resources, 

GAO-04-495R (Washington, D.C.: Feb. 27, 2004), and DOD and VA Health Care: Incentives 

Program for Sharing Health Resources, GAO-05-310R (Washington, D.C.: Feb. 28, 2005). 

5

We visited VA and DOD medical facilities at six sites—Augusta, Georgia; Honolulu, 

Hawaii; North Chicago, Illinois; El Paso, Texas; San Antonio, Texas; and Puget Sound, 

Washington. 

6

Those seven additional sharing sites were located in the following areas: Alaska, 

California, Kansas, New York, North Dakota, South Carolina, and Virginia. 

7

Under the JIF program, 12 projects were selected for implementation for fiscal year 2004,

but 1 project was removed due to legal concerns. For fiscal year 2005, 18 JIF projects were 

selected, but 1 project was removed due to asset realignment issues. Under the DSS 

program, 8 projects were selected. 

8

DOD provides health care through TRICARE—a regionally structured program that uses 

civilian contractors to maintain provider networks to complement health care services 

provided at MTFs. 

Page 2 GAO-06-315 VA and DOD Health Care Resource Sharing 
military services’ surgeons general offices, which coordinate sharing 

activities; and several military treatment facilities (MTF) engaged in the 

sharing of health care resources. We also interviewed officials from Joint 

Executive Council (JEC) committees and Health Executive Council (HEC) 

workgroups9

 to determine what policies, procedures, and guidance have

been promulgated to promote health care resource sharing and 

coordination between VA and DOD. Further, we spoke with officials from 

the Office of Management and Budget (OMB). We analyzed the charters 

and briefing updates for each JEC committee and HEC workgroup and 

reviewed OMB’s evaluation of the departments’ efforts to implement the 

PMA initiative. In addition, we analyzed workload, cost, and sharing 

agreement data between VA and each branch of military service. 

To assess whether VA and DOD performance measures are useful, we 

interviewed senior VA and DOD officials about how the sharing of health

care resources is measured. In addition, we analyzed the departments’ 

Joint Strategic Plan for Fiscal Year 2005, the departments’ JEC annual 

report to the Congress on sharing, and each department’s individual 

strategic plan. We also obtained and reviewed VA and DOD policies 

governing sharing and reviewed relevant department reports, including 

those from the DOD Inspector General and DOD contractors, along with 

our prior work. We performed our work from January 2005 through 

March 2006 in accordance with generally accepted government auditing 

standards. For more details on our scope and methodology, see 

appendix I. 

VA and DOD are making progress in implementing two programs required 

by the Congress in December 2002 to encourage health care resource 

sharing and collaboration between VA and DOD—JIF and DSS. While JIF 

projects experienced challenges because of delays resulting from the 

initial absence of funding mechanisms and, in some cases, the need for 

additional acquisition and construction approvals, as of December 2005, 

7 of 1110 selected 2004 projects were operational. The DSS program also 

Results in Brief 

 9

VA and DOD established JEC along with four additional interagency councils/committees

to further facilitate collaboration between the departments. HEC and its workgroups, 

which are under the purview of JEC, were developed as a mechanism to specifically further 

the sharing of health care resources between VA and DOD. 

10Originally 12 projects were selected; however, 1 project was removed due to legal 

concerns. VA and DOD’s offices of general counsel determined after the selection process 

that VA and DOD did not possess legal authority to pursue the project. Subsequently, this 

project was removed from the program and funding was reallocated. 

Page 3 GAO-06-315 VA and DOD Health Care Resource Sharing 
experienced challenges as some sites reported difficulty putting together 

project submission packages, noting confusion over the timelines and 

approval process as well as frustration with the amount of paperwork and 

rework required. Nonetheless, as of December 2005, 7 of the 8 DSS 

projects were operational.11 However, JEC and HEC have not established a 

plan to measure and evaluate the advantages and disadvantages of DSS 

projects—information that will be useful for determining whether projects 

that produce cost savings or enhance health care delivery efficiencies can 

be replicated systemwide. 

VA and DOD are creating mechanisms that support the potential to 

increase collaboration, sharing, and coordination of management and 

oversight of health care resources and services. The departments have 

taken steps to create interagency councils and workgroups to facilitate the 

sharing and collaboration of information, establish working relationships 

among their leaders, and develop communication channels to further 

health care resource sharing. In addition, the departments have worked 

together to develop a Joint Strategic Plan outlining six goals. However, 

JEC and HEC have not seized upon a number of opportunities to further 

health care resource sharing, collaboration, and coordination. For 

example, JEC and HEC have not developed a system for collecting, 

tracking, and monitoring information on the health care services that each

department contracts for from the private sector. Such a system could 

promote systemwide cost savings and efficiencies as the departments 

could exchange services from one another or possibly obtain better 

contract pricing through joint purchasing of services. In one case in 

northern California, VA and the Air Force were independently contracting 

with private providers for dialysis services—information that is not stored 

in a database to be shared with all VA and DOD health care facilities. 

During discussions with each other, local VA and Air Force officials 

recognized they were paying a high cost for dialysis services, got together 

to analyze their costs and determine the best approach for obtaining these

services, and worked together to open a joint dialysis clinic. In this case,

had VA and the Air Force known about their individual contracting 

 11In their technical comments to this report the departments stated that all eight projects 

are operational. However, a project in Hawaii is not fully operational. The goal of that 

project is to conduct and execute the findings of studies in four key areas: (1) Health Care

Forecasting, Demand Management, and Resource Tracking; (2) Referral Management and 

Fee Authorization; (3) Joint Charge Master Based Billing; and (4) Document Management. 

The project is not fully operational since, as DOD reported on February 27, 2006, the

policies and procedures have only been updated in one of the four areas—Referral 

Management and Fee Authorization. 

Page 4 GAO-06-315 VA and DOD Health Care Resource Sharing 
arrangements, they could have combined their contracting needs and 

negotiated services at a lower cost or opened a joint clinic earlier. 

Furthermore, JEC and HEC have not directed that a joint nationwide 

market analysis be conducted to obtain information on what their 

combined future workloads will be in the areas of services, facilities, and 

patient needs. 

VA and DOD lack performance measures that would be useful for 

evaluating how well the departments are achieving their health care 

resource-sharing goals. For example, of the 30 measures contained in the 

departments’ joint strategic plan, 5 that were called for in the plan were 

not developed at the time the plan was issued and 11 lacked long-term or 

longitudinal information. For the remaining 14 that require periodic 

measurement, there was variation in the rigor or specificity in the types of 

data to be collected or the analysis to be performed. 

We are recommending that the Secretaries of Veterans Affairs and Defense 

direct JEC and HEC to take two actions to advance health care resourcesharing activities between the departments. In commenting on a draft of

this report, VA and DOD concurred with our recommendations. 

VA operates one of the nation’s largest health care systems. In fiscal year 

2004, VA provided health care to approximately 5.2 million veterans at 157 

VAMCs and almost 900 outpatient clinics nationwide.12 In fiscal year 2004,

DOD provided health care to approximately 8.3 million beneficiaries,13

including active duty personnel and retirees, and their dependents. DOD 

health care is provided at more than 530 Army, Navy, and Air Force MTFs 

worldwide and is supplemented by TRICARE’s network of civilian 

providers. Through its TRICARE contracts, DOD uses civilian managed 

health care support contractors to develop networks of primary and 

specialty care providers and to provide other customer service functions, 

such as claims processing. DOD’s policy encourages inclusion of all VA 

health care facilities in its networks.

Background 

 12In fiscal year 2004, there were approximately 7.4 million veterans enrolled to receive care 

from VA. However, not all enrollees seek health care from VA. 

13In some cases, DOD beneficiaries may also be eligible for health care benefits from VA. 

Page 5 GAO-06-315 VA and DOD Health Care Resource Sharing 
Health care expenditures for VA and DOD are increasing. VA’s 

expenditures have grown—from about $12 billion in fiscal year 199014 to 

about $26.8 billion in fiscal year 2004—as an increasing number of 

veterans look to VA to meet their health care needs. DOD’s health care 

spending has gone from about $12 billion in fiscal year 199015 to about 

$30.4 billion in fiscal year 2004—in part, to meet additional demand 

resulting from congressional actions to expand program eligibility for 

military retirees, reservists, members of the National Guard, and their 

dependents, along with the increased needs of active duty personnel 

involved in conflicts in Afghanistan (Operation Enduring Freedom) and in 

Iraq (Operation Iraqi Freedom). Today, VA and DOD officials are reporting 

that many of their facilities are at capacity or exceeding capacity. The 

nature of sharing has shifted from one of utilizing untapped resources to 

one of partnering and gaining efficiencies by leveraging resources or 

buying power jointly. For example, VA and DOD have achieved 

efficiencies and cost avoidance through a concerted effort to jointly 

procure pharmaceuticals.16

Congressional Initiatives 

to Increase Health Care 

Resource Sharing 

The Congress has had a long-standing interest in expanding VA and DOD 

health care resource sharing. In 1982, the Congress passed the Veterans’ 

Administration and Department of Defense Health Resources Sharing and 

Emergency Operations Act (Sharing Act).17 The act authorizes VA and 

DOD to enter into sharing agreements to buy, sell, and barter health care 

resources to better utilize excess capacity. The head of each VA and DOD 

medical facility can enter into local sharing agreements. However, VA and

DOD headquarters officials review and approve agreements that involve 

national commitments, such as joint purchasing of pharmaceuticals. VA 

and DOD sharing activities have typically fallen into three categories. 

• Local sharing agreements allow VA and DOD to take advantage of their 

facilities’ capacity to provide health care by being providers of health 

services, receivers of health services, or both. Health services shared 

under these agreements can include inpatient and outpatient care; 

 14Adjusted for inflation, this would equal about $17 billion in fiscal year 2004. 

15Adjusted for inflation, this would equal about $17 billion in fiscal year 2004. 

16See GAO, DOD and VA Pharmacy: Progress and Remaining Challenges in Jointly 

Buying and Mailing Out Drugs, GAO-01-588 (Washington, D.C.: May 25, 2001).

17Pub. L. No. 97-174, 96 Stat. 70. 

Page 6 GAO-06-315 VA and DOD Health Care Resource Sharing 
ancillary services, such as diagnostic and therapeutic radiology; dental

care; and specialty care services, such as treatment for spinal cord 

injuries. Other examples of services shared under these agreements 

include support services, such as administration and management; 

research; education and training; patient transportation; and laundry. The 

goals of local sharing agreements are to allow VAMCs and MTFs to 

capitalize on their combined purchasing power, exchange health services 

to maximize use of resources, and provide beneficiaries with greater 

access to care. 

• Joint venture sharing agreements, as distinguished from local sharing 

agreements, aim to avoid costs by pooling resources to build a new facility 

or jointly use an existing facility. Joint ventures require an integrated 

approach, as two separate health care systems must develop multiple 

sharing agreements that allow them to operate as one system at one 

location. 

• National sharing initiatives are designed to achieve greater efficiencies, 

that is, to lower cost and improve access to goods and services when they 

are acquired on a national level rather than by individual facilities—for 

example, VA and DOD’s efforts to jointly purchase pharmaceuticals and 

surgical instruments for nationwide distribution. 

Later, in January 2002, the Congress passed legislation requiring VA and 

DOD to conduct a comprehensive assessment that would identify and 

evaluate changes to their health care delivery policies, methods, practices, 

and procedures in order to provide improved health care services at 

reduced cost to the taxpayer.18 To facilitate this, VA and DOD hired a 

contractor (at a cost of $2.5 million) to conduct the Joint Assessment 

Study that was completed on December 31, 2003.19 Unlike previous studies 

conducted by VA and DOD, the Joint Assessment Study combined VA and 

DOD beneficiary populations into a single market by geographic site.20 The 

contractor examined collaboration and sharing opportunities in three VA 

and DOD market areas: Hawaii; the Gulf Coast (Mississippi to Florida); 

and Puget Sound, Washington. Specifically, the study included a detailed 

 18Department of Defense and Emergency Supplemental Appropriations for Recovery from 

and Response to Terrorist Attacks on the United States Act, 2002, Pub. L. No. 107-117, §

8147, 115 Stat. 2230, 2280-81. 

19Findings and Recommendations from the DOD/VA Joint Assessment Study presented to

Office of Special Programs TRICARE Management Activity, December 31, 2003, Mitretek 

Systems. 

20The combined beneficiary market included VA beneficiaries, DOD beneficiaries, and 

beneficiaries eligible for care from both VA and DOD. 

Page 7 GAO-06-315 VA and DOD Health Care Resource Sharing 
independent review of options to colocate or share facilities and care 

providers in areas where duplication and some excess capacity may exist; 

optimize economies of scale through joint procurement of supplies and 

services; and partially or fully integrate VA and DOD systems to provide 

tele-health services, provider credentialing, cardiac surgical programs, 

rehabilitation services, and administrative services. 

The NDAA, passed in December 2002, required that VA and DOD 

implement two programs—JIF and DSS—to increase the amount of health

care resource sharing taking place between VA and DOD. Under JIF, the 

departments are to identify and provide incentives to implement, fund, and 

evaluate creative health care coordination and sharing initiatives. Under 

DSS, the departments are to select projects to serve as a test for evaluating

the feasibility, advantages, and disadvantages of programs designed to 

improve the sharing and coordination of health care resources. The NDAA 

also required VA and DOD jointly to develop and implement guidelines for 

a standardized, uniform payment and reimbursement schedule for selected 

health care services. In response, the departments established a 

standardized reimbursement methodology effective October 2003, 

between VA and DOD medical facilities through a memorandum of 

agreement implementing standardized outpatient billing rates based on the 

discounted Civilian Health and Medical Program of the Uniformed 

Services (CHAMPUS) Maximum Allowable Charges (CMAC)21 schedule. 

The NDAA also required VA and DOD to develop and publish a joint 

strategic plan to shape, focus, and prioritize the coordination and sharing 

efforts within the departments and incorporate the goals and requirements 

of the joint strategic plan into the strategic plan of each department.22 We 

have reported that there is no more important element in results-oriented 

management than an agency’s strategic planning effort.23 This is the 

starting point and foundation for defining what the department seeks to 

accomplish, identifying the strategies it will use to achieve desired results, 

and then determining how well it succeeds in reaching goals and achieving

Guidance Related to 

Strategic Planning and 

Performance Measures 

 21To reimburse civilian physicians, DOD has established a CMAC rate. It is the amount DOD 

will pay civilian providers for medical services for DOD patients. 

22Bob Stump National Defense Authorization Act for Fiscal Year 2003, Pub. L. No. 107-314, § 

721, 116 Stat. 2458, 2589-95. 

23GAO, Agencies’ Strategic Plans Under GPRA: Key Questions to Facilitate Congressional

Review, GAO/GGD-10.1.16 (Washington, D.C.: May 1997). 

Page 8 GAO-06-315 VA and DOD Health Care Resource Sharing 
objectives. We also previously reported that traditional management 

practices involve the creation of long-term strategic plans and regular 

assessments of progress toward achieving the plans’ stated goals.24

Moreover, the Government Performance and Results Act of 1993 (GPRA) 

requires agencies to set goals, measure performance, and report on their 

accomplishments.25 Performance measures are a key tool to help managers 

assess progress toward achieving the goals or objectives stated in their 

plans. They are also an important accountability tool to communicate 

department progress to the Congress and the public. 

Program performance measurement is commonly defined as the regular 

collection and reporting of a range of data, including a program’s 

• inputs, such as dollars, staff, and materials; 

• workload or activity levels, such as the number of applications that are in 

process, usage rates, or inventory levels; 

• outputs or final products, such as the number of children vaccinated, 

number of tax returns processed, or miles of road built; 

• outcomes of products or services, such as the number of cases of 

childhood illnesses prevented or the percentage of taxes collected; and 

• efficiency, such as productivity measures or measures of the unit costs for 

producing a service. 

Other data might include information on customer satisfaction, program 

timeliness, and service quality. Managers can use the data that

performance measures provide to help them manage in three basic ways: 

to account for past activities, to manage current operations, or to assess 

progress toward achieving planned goals and objectives. When used to 

look at past activities, performance measures can show the accountability 

of processes and procedures used to complete a task, as well as program 

results. When used to manage current operations, performance measures 

can show how efficiently resources, such as dollars and staff, are being

used. Finally, when tied to planned goals and objectives, performance 

measures can be used to assess how effectively a department is achieving

the goals and objectives stated in its long-range strategic plan.

 24GAO, Program Performance Measures: Federal Agency Collection and Use of 

Performance Data, GAO/GGD-92-65 (Washington, D.C.: May 4, 1992). 

25Pub. L. No. 103-62, 107 Stat. 285. 

Page 9 GAO-06-315 VA and DOD Health Care Resource Sharing 
OMB, through the PMA released in the summer of 2001, has emphasized 

improving government performance through governmentwide and agencyspecific initiatives. OMB is responsible for overseeing the implementation 

of the PMA and tracking its progress. According to OMB’s mission 

statement, its role is to help improve administrative management, develop

better performance measures and coordinating mechanisms, and reduce 

any unnecessary burdens on the public. For each initiative, OMB has 

established “standards for success” and rates agencies’ progress toward 

meeting these standards. Among the PMA initiatives, one specifically

focuses on improving coordination of VA and DOD programs and systems 

by increasing the sharing of services that will lead to reduced cost and 

increased quality of care.

While JIF projects experienced challenges caused by delays resulting from 

the initial absence of funding mechanisms and, in some cases, the need for 

additional acquisition and construction approvals, as of December 2005, 

7 of 1126 selected 2004 projects were operational. DSS also experienced 

challenges as some sites reported difficulty putting together project 

submission packages, noting confusion over the timelines and approval 

process as well as frustration with the amount of paperwork and rework 

required. Nonetheless, as of December 2005, 7 of the 8 DSS projects were 

operational.

The JIF program is to identify, fund, and evaluate creative health care 

coordination and sharing initiatives. Under the program, VA and DOD 

solicit proposals from their program offices, VAMCs, or MTFs for project 

initiatives at least annually. Legislation requires that the Secretaries of VA 

and DOD each contribute a minimum of $15 million from each 

department’s appropriation into a no-year27 account established in the U.S. 

Treasury for each of fiscal years 2004 through 2007. From December 2002

through May 2005, VA and DOD developed JIF program guidelines, 

Although JIF and DSS 

Programs 

Experienced Start-up 

Challenges, More 

Than Half of the 

Projects Are 

Operational 

JIF Projects Slowly 

Becoming Operational 

 26Originally 12 projects were selected; however, 1 project was removed due to legal 

concerns. VA and DOD offices of general counsel determined after the selection process 

that VA and DOD did not possess legal authority to pursue the project. Subsequently, this 

project was removed from the program and funding was reallocated. 

27Under the statute, 38 U.S.C. § 8111(d)(2), the funding is not required to be obligated and

expensed within a single fiscal year. The funds may be obligated and expensed over a

multiyear period. 

Page 10 GAO-06-315 VA and DOD Health Care Resource Sharing 
solicited and reviewed proposals, established an account within the U.S.

Treasury for funding projects, and selected and funded projects. A 

memorandum of agreement entered into by VA and DOD assigned the 

Financial Management Workgroup—a group established by HEC—as the 

administrator of JIF. The Financial Management Workgroup has oversight 

responsibility for the implementation, monitoring, and evaluation of the 

JIF program. The members of the workgroup review concept proposals for 

selection and provide their recommendations to HEC for final approval. 

They developed the following criteria28 to be used for evaluating the 

concept proposals and selecting the final projects: 

• support DOD and VA’s joint long-term approach to meeting the health care 

needs of their beneficiary populations; 

• improve beneficiary access; 

• ensure exportability to other facilities; 

• maximize the number of beneficiaries who would benefit from the 

initiative; 

• result in cost savings or cost avoidance; 

• develop in-house capability at a lesser cost for services now obtained by

contract; and 

• demonstrate that the project would be self-sustaining within 2 years. If 

funding is needed beyond 2 years, the local facility, the Surgeon General’s

office, or the Veterans Integrated Service Network29 must agree to provide 

it. 

VA and DOD officials completed their review of 58 concept proposals that 

were submitted for the fiscal year 2004 funding cycle and ultimately 

selected 12 projects (subsequently reduced to 11) for funding in 

November 2004. VA and DOD issued a request for project proposals for the 

fiscal year 2005 funding cycle in November 2004. Submissions were due by

January 2005, and according to VA and DOD officials, 56 concept 

proposals were submitted. VA and DOD reviewed the concept proposals in 

September 2005 and selected 18 for funding (subsequently reduced to 

 28These criteria were used to evaluate fiscal year 2004 proposals; VA and DOD reported in

February 2006 that the criteria have been slightly refined.

29The management of VA’s hospitals and other health care facilities is decentralized to 21 

regional networks referred to as Veterans Integrated Service Networks. 

Page 11 GAO-06-315 VA and DOD Health Care Resource Sharing 
17).30 See figure 1 for a timeline and associated events affecting the 

implementation of the JIF program. 

Figure 1: JIF Program Implementation Timeline 

a

Originally 12 projects were selected; however, 1 project was removed due to legal concerns. 

b

Originally 18 projects were selected; however, 1 project was removed due to asset realignment 

issues. 

Source: GAO analysis of VA and DOD documents.

Nov. 2004: 

Solicitation letter sent to VA and DOD 

entities for fiscal year 2005 projects

Sep. 2005: 

Final selection of 

fiscal year 2005 – 

18b projects

Jan. 2005: 

Proposals for fiscal year 2005 

projects received

2004 2005 Present 

2002 2003 2004 2005 Present 

Nov. 2003: 

Solicitation letter sent to VA and DOD 

entities for fiscal year 2004 projects

Aug. 2004: 

Final selection of fiscal year 2004 – 12 projects

Dec. 2002: 

Enactment of 

JIF program

Dec. 2002 - 

Nov. 2003: 

Development of 

program and 

project selection 

criteria Nov. 2004 - May 2005: 

Funding for 12a projects

authorized and transferred

Jan. 2004: 

Proposals for fiscal year 2004 projects received

JIF 2004 projects

JIF 2005 projects

Dec. 2005: 

Seven projects

operational

 30Originally 18 projects were selected; however, 1 project was removed due to asset 

realignment issues. 

Page 12 GAO-06-315 VA and DOD Health Care Resource Sharing 
Beginning in fiscal year 2004, each department as required by law, began 

contributing $15 million annually into the U.S. Treasury account 

established for funding JIF.31 VA and DOD report that as of January 2006, 

$54.3 million of the $90 million they contributed has been allocated to 

specific projects, and $5.3 million has been obligated. (See table 1.) For 

the 2004 JIF projects, project selection took place in August 2004. Initial 

funding for some of the projects began in November 2004. However, it was 

not until May 2005—about 21⁄2 years after the program was established—

that initial funding was provided to the last of the approved projects. 

Table 1: JIF Program Funding 

Dollars in millions 

Fiscal year 

Department required

contributions Allocateda

Obligatedb

2004 $30 $0 $0

2005 30 15.3 5.3

2006 30 39.0c - - 

2007 (projected) 30 - - - -

Total $120 $54.3 $5.3

Sources: VA and DOD.

a

For the purposes of this report, allocated represents the amount of money designated for specific 

projects. 

b

For the purposes of this report, obligated represents the amount of allocated funds that have been 

committed to project activities. 

c

Of the $39.0 million, $7.7 million was allocated toward year 2 funding for 2004 projects and the 

remaining $31.3 million was allocated for 2005 projects. 

According to officials from both departments, funding delays occurred for 

a number of reasons. VA and DOD needed time to set up the U.S. Treasury 

account and to establish funding mechanisms to facilitate the transfer of 

funds from the account to individual VAMCs or MTFs. Further, funding 

could not be provided until project officials and the surgeons general for 

DOD’s Departments of the Army, Navy, and Air Force completed required 

administrative actions. These actions included obtaining assurance from 

the surgeons general that service-specific department protocols for 

disbursing funds were followed and obtaining certification from project 

officials that projects would be self-sustaining within 2 years. 

 31The Congress directed VA and DOD to commence funding in fiscal year 2004. 

Page 13 GAO-06-315 VA and DOD Health Care Resource Sharing 
While all approved fiscal year 2004 projects have now received funding, 

those still in the development phase are in the process of acquiring needed 

equipment, staff, or space. In addition to the delays caused by VA and DOD 

administrative processes to fund projects, the individual projects 

experienced delays for other reasons. For example, officials from both 

departments reported that additional approvals for acquisition of 

equipment and minor construction were needed before some projects 

could be initiated. Specifically, VA and DOD officials in North Chicago, 

Illinois, stated that in addition to the approvals required from HEC’s 

Financial Management Workgroup and the Navy Surgeon General’s Office, 

they were also required to seek and obtain acquisition approval from the 

National Acquisition Center for the mammography unit requested in their 

project. The officials stated that these three distinct approval processes 

for their JIF project should have been merged into a single approval 

process. Further, VA and DOD officials in Honolulu, Hawaii, reported that 

because of delays in obtaining acquisition approvals, pricing increases 

occurred, resulting in increased cost to the government. Initial project 

approval occurred in August 2004; however, final contract approval was 

not granted as of December 2005, over a year later.32

As of December 2005, 4 of the 11 JIF fiscal year 2004 projects were still in 

the development stage, with 7 of 11 operational. Some of the projects that

were operational include a joint dialysis unit located at Travis Air Force 

Base, Fairfield, California, that according to VA and DOD officials, 

improves access for VA and DOD beneficiaries and lessens the cost to the 

government by reducing purchased services from the private sector; a teleradiology unit located at the VAMC in Spokane, Washington, that is 

providing tomography scans for DOD beneficiaries; and an imaging 

services unit at Elmendorf Air Force Base in Anchorage, Alaska, that 

allows VA and DOD to pool their imaging needs and provide services inhouse instead of contracting for them at very expensive fees charged by 

providers in this remote area. See appendix II for details about JIF 

projects selected in fiscal years 2004 and 2005. 

DSS projects are piloting different approaches to sharing health care 

resources in three areas—budget and financial management, coordinated 

staffing and assignment, and medical information and information 

technology. Further, each DSS project contains individual goals that have 

Most Demonstration Site 

Projects Are Operational 

 32DOD commented that the contract was awarded on February 23, 2006. 

Page 14 GAO-06-315 VA and DOD Health Care Resource Sharing 
the potential to promote VA and DOD health care resource sharing and 

collaboration. The objective of each project is aligned with VA’s and 

DOD’s strategic goal to jointly acquire, deliver, and improve health care 

services. From July 2003 through August 2004, VA and DOD developed 

DSS program guidelines, solicited and reviewed proposals, and began

funding projects. Eight projects were approved by HEC in October 2003; 

project funding began in August 2004; and as of December 2005, seven

projects were operational. 

The DSS program is to serve as a test for evaluating the feasibility and the 

advantages and disadvantages of projects designed to improve sharing. 

The Joint Facility and Utilization Workgroup—a group established by 

HEC—is responsible for DSS project selection and oversight. Projects 

selected by the workgroup must be approved by HEC. As required by the 

statute, there must be a minimum of three VA and DOD demonstration 

sites (projects) selected. Also, at least one project was required to be 

tested in each area. 

As required by law, each department was required to make available at 

least $3 million in fiscal year 2003, at least $6 million in fiscal year 2004, 

and at least $9 million for each subsequent year in fiscal years 2005 

through 2007 to fund DSS projects.33 During fiscal year 2003 no funds were 

allocated or obligated to projects because, according to VA and DOD 

officials, the business plans for the sites had not been finalized. During 

fiscal years 2004 and 2005, approximately $6.2 million and $12.7 million, 

respectively, of the $36 million made available by VA and DOD, were 

allocated to specific DSS projects, and $14.4 million was obligated. See 

table 2 for the amount of funds made available, allocated, and obligated

for the DSS program. 

 33Pub. L. No. 107-314, § 722(e), 116 Stat. 2595-98. 

Page 15 GAO-06-315 VA and DOD Health Care Resource Sharing 
Table 2: DSS Program Funding 

Dollars in millions 

Fiscal year 

Funds made 

available by VA 

and DOD Allocateda

Obligatedb

2003 $6 $0c$0

2004 12 6.2 4.9

2005 18 12.7 9.5

2006 (projected) 18 10.2 - -

2007 (projected) 18 9.7 - -

Total $72 $38.8 $14.4

Sources: VA and DOD.

a

For the purposes of this report, allocated represents the amount of money designated for specific 

projects. 

b

For the purposes of this report, obligated represents the amount of allocated funds that have been 

committed to project activities. 

c

According to VA and DOD officials, funding was not allocated in 2003 because the business plans for 

the sites had not been finalized. 

From July 2003 through October 2003, VA and DOD developed program 

guidelines and solicited and reviewed project proposals. Each proposal 

was reviewed and scored by members of the Joint Facility and Utilization 

Workgroup for each category for which it had been submitted. For 

example, according to VA and DOD officials, under budget and financial 

management, one of the criteria for selection included whether a project 

allowed managers to assess the advantages and disadvantages—in terms 

of relative costs, benefits, and opportunities—of using resources from 

either department to provide or enhance the delivery of health care 

services to beneficiaries of either department. For coordinated staffing 

and assignment projects, criteria included whether the project could 

demonstrate agreement on staffing responsibilities in providing joint 

services and the development of a plan to provide adequate staffing in the

event of deployment or contingency operation. Criteria related to medical

information and information technology included whether a project could 

communicate medical information and incorporate minimum standards of 

information quality and information assurance related to either 

credentialing, consolidated mail outpatient pharmacy, or laboratory data

sharing. According to VA and DOD officials, upon selection DSS projects 

are to be monitored via periodic progress assessments to ensure that 

project activities align with the cost, schedule, and performance 

parameters outlined in the submitted business plan. 

Page 16 GAO-06-315 VA and DOD Health Care Resource Sharing 
The Joint Facility and Utilization Workgroup forwarded eight DSS project 

proposals to HEC, which approved them in October 2003. However, sites 

reported some difficulty putting together the project submission packages. 

For example, one site noted there was initial confusion over the timelines 

and approval process as each department had differing requirements. 

Another site expressed frustration with the amount of paperwork and 

rework required. Nevertheless, by June 2004 the sites developed and 

submitted for VA and DOD approval proposed implementation and 

business plans for their projects, in August 2004 VA and DOD began 

project funding, and in May 2005 VA and DOD reported that they had

approved all the proposed project business plans. As of December 2005, 

VA and DOD reported that the following seven DSS projects were 

operational:

• A project at San Antonio, referred to as the Laboratory Data Sharing 

Initiative (LDSI), has been successful in enabling each department to 

conduct laboratory tests and share the results with each other. This 

project allows a VA provider to electronically order laboratory tests and 

receive results from a DOD facility, and conversely, a DOD provider can 

electronically order laboratory tests and receive results from a VA facility.

An early version of what is now LDSI was originally tested and 

implemented at a joint VA and DOD medical facility in Hawaii in May 2003. 

The San Antonio LDSI demonstration project built on the Hawaii version 

and enhanced it. According to the departments, a plan to export LDSI to 

additional sites has been approved. 

• An electronic data exchange project at El Paso successfully exchanged 

laboratory orders and results as well as limited patient information—

demographic, outpatient pharmacy, radiology, laboratory, and allergy data. 

• An electronic data exchange project at Puget Sound has also achieved 

similar results by exchanging limited patient information—demographic, 

outpatient pharmacy, radiology, allergy data, and discharge summaries. 

The results of the project are scheduled to be replicated at five additional 

VA and DOD sites during the first quarter of fiscal year 2006. 

• A project at Augusta to coordinate the staffing and sharing of nurses at VA 

and DOD facilities has yielded savings in terms of cost, time, and training 

resources. 

• A project in Alaska is producing itemized bills for each individual VA 

patient seen at the DOD facility. The cost for each patient visit is then 

credited in VA’s accounting system to capture the workload. 

• A project at San Antonio has successfully shared credentialing data for 

licensed VA and DOD providers through an interface between the two 

departments’ individual credentialing systems. 

Page 17 GAO-06-315 VA and DOD Health Care Resource Sharing 
• A project at Hampton is using an automated tool to evaluate staffing 

shortfalls and mitigate identified gaps in the resources needed to provide 

health care services to VA and DOD beneficiaries. 

According to VA and DOD officials, they plan to evaluate whether the eight 

projects were successful and if they can be replicated at other VA and 

DOD medical facilities. However, as of November 2005, VA and DOD had 

not developed an evaluation plan for making these assessments. See 

appendix III for additional details about the DSS projects. See figure 2 for 

a timeline and associated events affecting the implementation of the DSS

program. 

Figure 2: DSS Program Implementation Timeline

VA and DOD have taken steps to create interagency councils and 

workgroups to facilitate the sharing and collaboration of information, 

establish working relationships among their leaders, and develop 

communication channels to further health care resource sharing. 

However, JEC and HEC have not seized upon a number of opportunities to 

further collaboration and coordination. 

Source: GAO analysis of VA and DOD documents.

2002 2003 2004 2005 Present 

Jul. 2003 - 

Oct. 2003: 

Proposals for DSS

projects solicited 

and reviewed

Oct. 2003: 

Selection of eight 

DSS projects

approved

Aug. 2004: 

Funding for 

projects begins

Dec. 2002: 

Enactment of 

DSS program

May 2005: 

Final approval of 

the business plans

for each project

DSS projects

Dec. 2005: 

Seven projects

operational

Jun. 2004: 

Sites developed and 

submitted implementation 

and business plans

VA and DOD Have 

Taken Actions to 

Strengthen Health 

Care Resource 

Sharing, but 

Important 

Opportunities Remain

Page 18 GAO-06-315 VA and DOD Health Care Resource Sharing 
In addition to the development of congressionally mandated JIF and DSS 

programs, VA and DOD have created mechanisms to enhance health care 

resource sharing by forming JEC and through a proposed federal health

care facility in North Chicago. The two departments have also worked 

together to develop a Joint Strategic Plan outlining six goals.

In February 2002, VA and DOD established JEC to enhance VA and DOD 

collaboration; ensure the efficient use of federal services and resources; 

remove barriers and address challenges that impede collaborative efforts; 

assert and support mutually beneficial opportunities to improve business 

practices; facilitate opportunities to enhance sharing arrangements that 

ensure high-quality, cost-effective services for both VA and DOD 

beneficiaries; and develop a joint strategic planning process to guide the 

direction of joint sharing activities.34 JEC is co-chaired by the Deputy 

Secretary of Veterans Affairs and the Under Secretary of Defense for 

Personnel and Readiness.35 Membership consists of senior leaders from 

both VA and DOD, including VA’s Under Secretary for Benefits and Under 

Secretary for Health and DOD’s Principal Deputy Under Secretary of 

Defense for Personnel and Readiness and Assistant Secretary for Health 

Affairs. JEC established two interagency councils and two interagency

committees to facilitate collaboration: (1) Benefits Executive Council, (2)

HEC, (3) VA/DOD Construction Planning Committee (CPC), and (4) Joint 

Strategic Planning Committee. 

HEC was placed under the purview of JEC specifically to advance VA and 

DOD health care resource sharing and collaboration. Through HEC, VA 

and DOD have developed policies and procedures for facilitating health

care resource-sharing activities. Together, the two departments are 

working to create, implement, and adhere to joint standards in the areas of 

clinical guidelines, information technology, deployment health policies, 

and purchasing of medical and surgical supplies. HEC has organized itself 

into 11 workgroups—on subjects such as financial management, 

pharmacy, and deployment health—in order to carry out its mission (see 

Actions Taken to Enhance 

Health Care Resource 

Sharing 

Joint Executive Council 

 34National Defense Authorization Act for Fiscal Year 2004, Pub. L. No. 108-136 § 583, 117 

Stat. 1392, 1490-92, required VA and DOD to establish a joint executive committee. VA and 

DOD use their JEC structure to fulfill this legislative requirement. 

35In 1997, VA and DOD established HEC—a precursor to JEC, which was co-chaired by the 

VA Under Secretary for Health and the Assistant Secretary of Defense (Health Affairs). In

fiscal year 2002, JEC was established to further engage VA and DOD senior leadership, 

including VA’s Deputy Secretary and DOD’s Under Secretary for Personnel and Readiness,

who serve as co-chairs for JEC. 

Page 19 GAO-06-315 VA and DOD Health Care Resource Sharing 
fig. 3).36 HEC’s mission includes formulating VA and DOD joint policies 

that relate to health care, facilitating the exchange of patient information, 

and ensuring patient safety. HEC membership includes senior leaders from 

VA and DOD. HEC is co-chaired by VA’s Under Secretary for Health and 

DOD’s Assistant Secretary of Defense for Health Affairs. DOD membership 

also includes the surgeons general for the military services. See 

appendix IV for a description of VA’s and DOD’s councils, committees, and 

workgroups. 

Figure 3: VA/DOD JEC Organizational Chart, as of October 2005 

Sources: VA and DOD.

Joint Executive Council

Benefits Executive Council Health Executive Council VA/DOD Construction

Planning Committee

Joint Strategic Planning 

Committee

Evidence-Based 

Practice Guidelines

Workgroup

Financial

Management

Workgroup

Joint Facility 

Utilization/ 

Resource 

Sharing Workgroup

Information Management/ Information 

Technology

Workgroup

Deployment

Health

Workgroup

Medical Materiel 

Management

Workgroup

Pharmacy

Workgroup

Contingency

Planning

Workgroup

Patient

Safety

Workgroup

Graduate Medical

Education

Workgroup

Continuing 

Education and 

Training 

Workgroup

 36On February 27, 2006, DOD stated that the departments have added an additional 

workgroup—the Mental Health Workgroup. 

Page 20 GAO-06-315 VA and DOD Health Care Resource Sharing 
HEC workgroups, such as Joint Facility Utilization/Resource Sharing, 

Deployment Health, and Evidence-Based Practice Guidelines, develop and 

implement changes in policy and guidance approved by HEC. For 

example, the Deployment Health Workgroup has developed medical and 

public health policy for active duty service members who have been 

exposed to tuberculosis, to be treated by VA without co-payment. This 

policy allows separating service members to continue to receive 

antituberculosis prophylactic treatment at a VA facility following their 

separation from active duty military service. Further, the Deployment 

Health Workgroup has developed a roster identifying Operation Enduring 

Freedom and Operation Iraqi Freedom veterans who are separating or 

who have separated from active duty military service. VA is using this 

roster to mail letters to individuals thanking them for their service and 

advising them of their VA benefits based on their service in a combat 

theater. VA is also using this roster to determine postdeployment VA 

health care utilization by this population of veterans. Other efforts include 

the Evidence-Based Practice Guidelines Workgroup’s development of 

standardized guidelines to improve patient outcomes for both VA and 

DOD beneficiaries. In fiscal year 2005, the workgroup began revising four 

of its guidelines, including rehabilitation for servicemembers with 

amputations. Completed guidelines are presented at various national 

meetings. Tools such as CD-ROMs, pocket cards, and patient brochures 

are made available for VA and DOD providers in order to enhance 

communications with their patients.

JEC and HEC are also promoting integration through the establishment of 

a combined VA and DOD federal health care facility in North Chicago. 

According to VA and DOD, it was through discussions during JEC and 

HEC meetings that the combined federal facility in North Chicago was 

envisioned. According to a DOD official, the combined facility will be a 

hospital. The current plan is to build an ambulatory care clinic that will be 

attached to the current VA medical center. According to the DOD official, 

for the first time VA and DOD will operate a facility under a single chain of 

command that would integrate the budget and management for providing

medical services from both departments to achieve one cohesive medical 

facility that serves VA and DOD beneficiaries. This management structure 

differs significantly from joint ventures in which separate VA and DOD 

management structures coexist. The North Chicago Federal Health Care 

Facility is scheduled to be operational in fiscal year 2010. 

North Chicago Federal Health 

Care Facility 

Page 21 GAO-06-315 VA and DOD Health Care Resource Sharing 
VA and DOD also developed a strategic plan in December 2004 that 

includes six joint goals.37 Each of JEC’s councils and committees and 

HEC’s workgroups has been assigned responsibility for meeting some 

aspects of the goals outlined in the joint strategic plan. For example, 

according to VA and DOD officials, the Financial Management Workgroup 

developed a standardized business case analysis template for the JIF 

program to increase efficiency of operations. VA and DOD staff utilize this 

template when requesting funding for joint projects. Previously, the 

individual branches of the service had their own templates, all of which 

were slightly different. The departments’ joint goals are as follows: 

Joint Strategic Plan 

• Goal 1: Leadership Commitment and Accountability. Promote 

accountability, commitment, performance measurement, and enhanced 

internal and external communication through a joint leadership 

framework. 

• Goal 2: High-Quality Health Care. Improve the access, quality, 

effectiveness, and efficiency of health care for beneficiaries through 

collaborative activities. 

• Goal 3: Seamless Coordination of Benefits. Promote coordination of 

benefits to improve understanding of and access to benefits and services 

earned by servicemembers and veterans through each stage of life, with a 

special focus on ensuring a smooth transition from active duty to veteran 

status. 

• Goal 4: Integrated Information Sharing. Ensure that appropriate 

beneficiary and medical data are visible, accessible, and understandable 

through secure and interoperable information management systems. 

• Goal 5: Efficiency of Operations. Improve management of capital 

assets, procurement, logistics, financial transactions, and human 

resources. 

• Goal 6: Joint Medical Contingency/Readiness Capabilities. Ensure 

the active participation of both departments in federal and local incident 

and consequence response through joint contingency planning, training,

and exercising. 

While progress has been made, JEC and HEC—which are responsible for 

advancing VA and DOD health care resource sharing and collaboration—

have not seized upon a number of opportunities to promote sharing and 

collaboration. For example, during the course of our audit work, we found 

Opportunities to 

Strengthen Health Care 

Resource Sharing Remain 

 37Department of Veterans Affairs/Department of Defense, VA/DOD Joint Strategic Plan 

(Washington, D.C.: December 2004). 

Page 22 GAO-06-315 VA and DOD Health Care Resource Sharing 
that JEC and HEC have not developed a system for jointly collecting,

tracking, and monitoring information on the health care services that VA 

and DOD contract for from the private sector; directed that a joint 

nationwide market analysis be conducted that contains information on 

what the departments’ combined future workloads will be in the areas of 

services, facilities, and patient needs; disseminated in a timely manner the 

information or the tools developed by a congressionally required study 

(the Joint Assessment Study) for assessing collaboration and sharing 

opportunities; or established standardized inpatient reimbursement 

rates—initiatives that would be useful for maximizing health care 

resource-sharing opportunities and promoting systemwide cost savings 

and efficiencies. 

Though the Army, Air Force, and Navy each record the amount of care 

that is purchased from the private sector, they do not collectively merge 

that information or combine it with VA’s total expenditures for services 

purchased from the community. As a result, a systematic approach for 

collecting, tracking, and monitoring information on the services that each

department contracts for from the private sector is lacking. 

Such an approach could help VA and DOD achieve systemwide cost 

savings and efficiencies, as has been demonstrated at the local level where

officials at certain sites compare their analyses and seek to exchange

services from one another or possibly obtain better contract pricing 

through joint purchasing of services. For example, for fiscal year 2003, a 

VA official at one site estimated that VA reduced its cost by $1.7 million as 

compared to acquiring the same services in the private sector through its 

agreements with the Army; he also estimated that the Army reduced its 

cost by about $1.25 million as compared to acquiring the same services in 

the private sector. For instance, the site jointly leased a magnetic 

resonance imaging (MRI) unit. The unit eliminated the need for 

beneficiaries to travel to more distant sources of care. According to a VA 

official, the purchase reduced MRI cost by 20 percent as compared to 

acquiring the same services in the private sector.

The availability of such information would be helpful to VA and DOD sites 

at the local level for sharing information on services they have

independently contracted for from the private sector. For example, VA and 

the Air Force at a northern California site were able to create efficiencies 

after recognizing that they had been independently contracting for the 

same services. Both VA and the Air Force had been sending patients to 

private providers for dialysis services—information that is not stored in a 

database to be shared with all VA and DOD health care facilities. During 

System for Tracking VA and 

DOD Purchased Services 

Page 23 GAO-06-315 VA and DOD Health Care Resource Sharing 
discussions, local VA and Air Force officials recognized they were paying a 

high cost for dialysis services, got together to analyze their costs and 

determine the best approach for obtaining these services, and worked 

together to open a joint dialysis clinic. In this case, had VA and the Air 

Force known about their individual contracting arrangements, they could

have combined their contracting needs and negotiated services at a lower 

cost or opened a joint clinic earlier. 

In response to our concerns and those of the Congress, VA initiated a 

review of its capital assets under the Capital Asset Realignment for 

Enhanced Services (CARES) program. The review was to provide a 

comprehensive, long-range assessment of VA’s health care system’s capital

asset requirements. In May 2004, the Secretary’s CARES decision 

document was issued and, according to VA, serves as a road map for 

aligning its facilities with the health care needs of 21st century veterans.38

The CARES report addresses partnering with DOD. It outlines existing and 

potential areas of sharing at the local level and opportunities for joint 

ventures. 

DOD was authorized to assess its infrastructure and provide base 

realignment and closure (BRAC) recommendations in 2005 to an 

independent commission for its review.39 An objective of the 2005 BRAC 

Commission, in addition to realigning DOD’s base structure to meet postCold War force structure, was to examine and implement opportunities for 

greater sharing with VA. Joint cross-service groups were tasked with 

analyzing common business-oriented functions, such as health care. The 

Medical Joint Cross-Service Group was chartered to review DOD’s health 

care functions and to provide BRAC recommendations based on that 

review. As we reported in July 2005, our examination of the BRAC process 

found that while the medical group examined the capacity and proximity 

of VA facilities to existing MTFs in its analysis, it did not coordinate with 

VA to determine whether military beneficiaries who normally receive care 

at MTFs could also receive care at VA facilities in the vicinity.

40

Nationwide Market Analysis 

 38Department of Veterans Affairs, Office of the Secretary, Secretary of Veterans Affairs 

CARES Decision (Washington, D.C.: May 2004). 

39See Defense Base Closure and Realignment Act of 1990, Pub. L. No. 101-510, as amended, 

codified at 10 U.S.C.A. § 2687 note (2004 Supp.). 

40GAO, Military Bases: Analysis of DOD’s 2005 Selection Process and Recommendations 

for Base Closures and Realignments, GAO-05-785 (Washington D.C.: July 1, 2005).

Page 24 GAO-06-315 VA and DOD Health Care Resource Sharing 
Each department has individually analyzed its health care needs—in part 

through VA’s efforts to realign its capital assets under the CARES process 

and through DOD’s BRAC process. Each department issued reports, which 

contained references to sharing or partnering with one another in the 

future. However, JEC and HEC have not conducted a nationwide 

integrated review and market analysis that would provide information on 

what their combined future health care workloads and needs may be. Such 

information is necessary to fully evaluate, and maximize the potential for,

health care resource-sharing opportunities. In its February 27, 2006, 

comments DOD stated that HEC has established a BRAC Impact and 

Opportunity Ad Hoc Workgroup to explore and identify opportunities for 

local collaboration and health care partnerships between VA and DOD in 

areas potentially affected by BRAC action. The work of this group would 

be a step in obtaining information on VA’s and DOD’s combined future 

health care workloads and needs. 

Furthermore, JEC and HEC have not disseminated in a timely manner the 

information or the tools developed by the DOD/VA Joint Assessment Study 

that examined the collaboration and health care sharing opportunities for 

three VA and DOD sites. For example, officials at one site stated that they 

did not receive the study findings until almost a year after it was 

completed. At that point, the officials stated that the market information 

was outdated and of little use to the site in forecasting and planning for 

future work. In addition, the study also produced a tool for combining VA 

and DOD beneficiary populations by geographic site. Utilizing this 

information, the contractor was able to forecast local market demand for 

health services—potentially allowing VA and DOD officials to plan and 

provide services to their “combined market.” Further, the contractor 

formulated “crosswalk” tables to assist VA and DOD in matching similar 

health care services. Historically, VA and DOD have captured health 

services information in varying formats and could not always account for 

their workloads in the same manner. The tool would provide VA and DOD 

health care managers within geographic areas with information on the 

health care needs of the combined beneficiary populations—information 

that could be useful to them for sharing and joint purchase decisions. 

However, 2 years after development of the tool, it is currently being 

utilized at one site. 

During the course of our audit work, we also found instances in which 

HEC could have asserted itself in local decision making to maximize 

resource-sharing opportunities as well as to help ensure continuity of care 

for beneficiaries. For example, see the following:

Dissemination of Results from 

the Joint Assessment Study 

Beneficiary Care 

Page 25 GAO-06-315 VA and DOD Health Care Resource Sharing 
• In Honolulu, Hawaii, we were informed by DOD that Tripler Army Medical 

Center (Tripler) had resources available to meet the health care needs of 

certain VA beneficiaries, yet VA chose to send them to its medical center 

in Palo Alto, California, for their care. Hawaii VA officials told us it does 

this because the cost of care is borne by Palo Alto and not by the Hawaii 

VA medical center, which would have to reimburse Tripler for the care. 

Under this scenario, the federal government is paying for underutilized 

resources and providers at Tripler. We believe HEC has an opportunity to 

step in and ensure that Tripler resources are fully maximized—an initiative

that would ultimately result in overall savings to the government. More 

important, beneficiaries treated at Palo Alto return to Hawaii and require 

follow-up care, and in some cases emergency care, that is often provided 

by Tripler—a situation that could raise continuity of care issues. By fully 

maximizing resources at Tripler, HEC would be helping to ensure that 

initial treatments are provided closer to a beneficiary’s home and that 

continuity of care is maintained. 

• In San Antonio, Texas, we found that VA contracts out approximately 

$1.5 million for diagnostic services to various private sector laboratories 

even though local MTFs have the capacity to provide these services. 

According to VA, it contracts out to the private sector because the costs 

are less than what DOD facilities charge. While it is understandable that

VA would seek to purchase services at the best prices possible, this 

practice may result in greater costs to the government as it is incurring 

VA’s costs as well as the costs to maintain underutilized DOD facilities. In

this case, JEC and HEC have not taken the initiative to determine the most 

cost-effective strategy for meeting VA’s and DOD’s laboratory service 

needs—information that would be useful for VA and DOD to ensure good 

stewardship of federal resources. 

Finally, we found that HEC could be more proactive in establishing joint 

policies or guidance in a timely manner that facilitates health care 

resource sharing. For example, in December 2002 legislation required VA 

and DOD to establish a national standardized uniform payment and 

reimbursement schedule for selected health care services. In 2003, VA and 

DOD established a reimbursement rate for outpatient services. However, 

VA and DOD have not yet established an inpatient reimbursement rate. 

Though HEC reports it is in the process of soliciting input and developing 

guidance for an inpatient rate, we found that without an established 

inpatient rate local officials were forced to negotiate rates among 

themselves—an activity that consumed staff time and often created 

tension between partners. 

In addition to our observations on opportunities for VA and DOD to 

strengthen health care resource sharing, OMB, the agency responsible for 

Standardized Inpatient 

Reimbursement Rates 

OMB’s Evaluation of VA and 

DOD Sharing Activities 

Page 26 GAO-06-315 VA and DOD Health Care Resource Sharing 
improving administrative management in the executive branch, also sees 

room for improvement in achieving the President’s goal to increase VA and 

DOD health care resource-sharing activities. OMB evaluates VA and DOD’s 

health care resource-sharing activities by providing an overall or 

composite score on their ability and progress to 

• exchange patient medical record information between VA and DOD 

electronically, 

• adopt governmentwide information technology standards for health 

records, 

• develop a plan for VA to use DOD’s enrollment and eligibility data, 

• establish the DSS program, 

• develop a graduate medical education pilot program, 

• increase nongraduate medical education training and education 

opportunities, 

• utilize one examination for separating servicemembers that meets the 

needs of VA and DOD, and 

• purchase medical supplies and equipment jointly.41

OMB uses a color code—green, yellow, and red—to score the current 

status and progress of health care resource-sharing activities. A score in 

the green status would indicate that the departments are achieving the 

degree of health care resource sharing agreed upon by the departments 

and the administration. Yellow status means the coordination of VA and 

DOD health care resource-sharing activities are yielding mixed results and 

not meeting their timelines. A red score would indicate that the 

departments are not achieving the degree of health care resource sharing 

agreed upon by the departments and the administration. Since OMB first 

began scoring the departments in 2001, the score for “current status” of 

health care resource sharing has remained yellow and the score for 

“progress in implementation” has dropped from the best score of green to

a score of yellow. 

 41OMB’s scorecard for PMA Initiative 14—VA/DOD Sharing—does not score each of these 

factors individually, rather it uses them to develop two composite scores: (1) Current 

Status and (2) Progress in Implementation. 

Page 27 GAO-06-315 VA and DOD Health Care Resource Sharing 
VA and DOD Lack 

Useful Performance 

Measures to Evaluate 

Health Care Resource 

Sharing 

VA and DOD health care resource-sharing activities are guided by a joint 

strategic plan—the VA/DOD Joint Strategic Plan, December 2004. 

However, the plan does not contain performance measures that are useful 

for evaluating how well the departments are achieving their health care 

resource-sharing goals.

For example, the plan mentions 30 measures that could be used to assess 

the departments’ progress in sharing health care resources. We reviewed

the plan and found that the measures could be placed into one of three 

categories: (1) a measurement that would be developed in the future, (2) a 

measurement that took place only once, and (3) a measurement that was 

taken periodically. 

We placed 5 of the 30 measures in the first category because the plan 

states that these measures will be developed in the future. For example, 

the plan states that a communication effectiveness measure will be 

developed as part of the communication strategy. The plan also states that 

VA and DOD will develop performance measures related to joint education

and training opportunities by December 2006. 

Further, we placed 11 of the 30 measures in the second category because 

they call for a single event measurement, such as “increase the number of 

collaborative research projects completed by VA and DOD by December 

2007,” or they state a goal, such as a system “will be fully operational and

providing VA benefit eligibility information by December 2008.” While 

measurements of this type may provide useful snapshot information of 

output for a point-in-time prospective, they are not periodic and thus do 

not provide long-term or longitudinal information for evaluating the 

usefulness of specific activities. 

Finally, in the third category we placed the plan’s remaining 14 measures 

that call for periodic measurement. We found there was variation in the 

rigor or specificity in the types of data to be collected or the analysis to be

performed. For example, CPC is tasked with reporting to JEC quarterly; 

however the tasking does not specify the types of data to be collected or 

the analytical assessments to be performed. Another performance 

measure from the plan states that the “Amount of electronic health data

available to the other department is higher each quarter reported.” The 

lack of specificity with this performance measure raises questions about 

the usefulness of the information for evaluating how well the departments 

are achieving their health care resource-sharing goals. 

Page 28 GAO-06-315 VA and DOD Health Care Resource Sharing 
Furthermore, VA and DOD have not established a performance measure 

that would track their progress in jointly obtaining health care services—

such as difficult-to-fill occupations, laboratory tests, and diagnostic 

equipment. For example, while VA and DOD are in the process of jointly 

acquiring five MRI units to help with their diagnostic needs through the 

JIF program, other opportunities for sharing MRI units may exist. During 

our review, we did not find evidence that VA and DOD top management 

set an expectation for their medical facility managers to consider 

partnering prior to purchasing MRI equipment. Without such an 

expectation and a specific measurement tool or metric to track the joint 

acquisition and utilization of MRI services, VA and DOD are not in a 

position to determine on a nationwide basis the most cost-efficient way to

obtain and deliver MRI services. 

When the idea of health care resource sharing was originally conceived 

and sanctioned by the Congress in the early 1980s, it was based on the 

premise of excess capacity. However, the set of circumstances that 

confront VA and DOD today are quite different, as both departments strive

to serve an increasing number of beneficiaries. VA and DOD officials state 

that many of their facilities are at capacity or exceed capacity. The nature 

of sharing has shifted from one of utilizing untapped resources to one of 

partnering and gaining efficiencies by leveraging resources or buying 

power jointly. Implementing such a process across all components 

involved with the delivery of VA and DOD health care should yield positive 

results as resource sharing becomes an integral part of a systemwide 

decision-making process. However, while VA and DOD, through JEC and 

HEC, have created mechanisms that support the potential to increase 

collaboration, sharing, and coordination of management and oversight of 

health care resources and services, more can be done to capitalize on this

relationship throughout the departments. 

The Congress provided additional sharing opportunities for local entities 

through the establishment of JIF and DSS. These programs have laid the 

foundation for new sharing relationships and, in other cases, have 

deepened existing relationships. The goals of each of the projects are 

aligned with VA’s and DOD’s goals to jointly acquire, deliver, and improve 

health care services. Both the JIF and DSS programs provide a 

congressionally driven mechanism to help increase the number of new 

sharing agreements between VA and DOD partners. However, VA and DOD 

have not yet developed a standardized evaluation plan for documenting 

and recording the advantages and disadvantages of each project and 

whether they can be replicated at other VA and DOD medical facilities. 

Conclusions 

Page 29 GAO-06-315 VA and DOD Health Care Resource Sharing 
Without an established evaluation plan to measure and determine the 

results of the projects, VA and DOD may lose an opportunity to obtain 

information that will be useful for determining whether projects can be 

replicated systemwide. 

The Joint Strategic Plan is a positive first step toward outlining VA and 

DOD sharing goals and measures. However, useful specific quantitative 

performance measures for VA and DOD to track the progress of their 

health care resource-sharing activities have not been established. Such

measures would be a useful tool for VA and DOD to help ensure that 

health care sharing is optimized and that the departments are cost 

efficiently achieving their resource-sharing goals.

To further advance health care resource sharing within VA and DOD, the 

Secretaries of Veterans Affairs and Defense should direct JEC and HEC to 

take the following two actions: 

• develop an evaluation plan for documenting and recording the reasons for 

the advantages and disadvantages of each DSS project, an activity that will 

assist VA and DOD in replicating successful projects systemwide, and 

• develop performance measures that would be useful for determining the 

progress of their health care resource-sharing goals. 

We received comments from VA and DOD on a draft of this report. The 

departments concurred with our recommendations and also provided 

technical comments that we have incorporated as appropriate. VA’s 

comments are included as appendix V and DOD’s comments are included 

as appendix VI. 

VA and DOD agreed with our recommendation to develop a DSS 

evaluation plan and described their plans and timelines for implementing 

it. The departments stated they have modified an in-progress review 

template to strengthen department information on the advantages and 

disadvantages of each project and whether they can be replicated 

systemwide. According to the departments, the template was distributed 

to the DSS sites in January 2006 and will be operational in the second 

quarter of fiscal year 2006. 

VA and DOD also agreed with our recommendation to develop

performance measures that would be useful for determining the progress 

of achieving health care resource-sharing goals. In their comments, the 

Recommendations for 

Executive Action 

Agency Comments 

and Our Evaluation 

Page 30 GAO-06-315 VA and DOD Health Care Resource Sharing 
departments stated that they have, since the work was completed for this 

report, issued the VA/DOD Joint Executive Council Strategic Plan, 

Fiscal Years 2006-2008 (signed by VA and DOD on January 26, 2006)—a 

plan that revises and updates the VA/DOD Joint Strategic Plan, 

December 2004 and contains performance measures that demonstrate 

measurable progress relative to specific strategic milestones. VA included 

a copy of the updated plan with its comments and noted that action on this

recommendation has been completed as performance measures have been

identified for each of the health care resource-sharing goals. We do not 

agree that the January 2006 plan fully addresses the concerns raised in the

report, and maintain our recommendation that useful measures—those 

that provide specifics regarding time frames, implementation strategies, 

and the type of information that will be reported to program managers—

need to be developed. For example, our review of the Joint Strategic Plan,

Fiscal Years 2006-2008, showed that while goal 6—Joint Medical 

Contingency/Readiness Capabilities—has strategies and key milestones, it 

contained no performance measures for monitoring progress toward 

achieving the stated goal. Furthermore, 6 of the plan’s 22 performance 

measures call for one point-in-time measurement and thus do not provide 

longitudinal information for evaluating the usefulness of specific activities.

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

and Defense, appropriate congressional committees, and other interested

parties. We will also make copies available to others upon request. In 

addition, the report is available at no charge on the GAO Web site at 

http://www.gao.gov. 

If you or your staff have questions about this report, please contact me at

(202) 512-7101 or ekstrandl@gao.gov. Contact points for our Office of 

Congressional Relations and Public Affairs may be found on the last page 

of this report. Michael T. Blair, Jr., Assistant Director; Aditi Archer; Jessica

Cobert; Kevin Milne; and Julianna Williams made key contributions to this 

report. 

Laurie E. Ekstrand 

Director, Health Care 

Page 31 GAO-06-315 VA and DOD Health Care Resource Sharing 
List of Committees 

The Honorable John Warner 

Chairman 

The Honorable Carl Levin 

Ranking Minority Member 

Committee on Armed Services 

United States Senate 

The Honorable Larry E. Craig 

Chairman 

The Honorable Daniel K. Akaka 

Ranking Minority Member 

Committee on Veterans’ Affairs 

United States Senate 

The Honorable Duncan Hunter 

Chairman 

The Honorable Ike Skelton 

Ranking Minority Member 

Committee on Armed Services 

House of Representatives 

The Honorable Steve Buyer 

Chairman 

The Honorable Lane Evans 

Ranking Minority Member 

Committee on Veterans’ Affairs 

House of Representatives 

Page 32 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix I: Scope and Methodology Appendix I: Scope and Methodology 

To assess the Department of Veterans Affairs’ (VA) and Department of 

Defense’s (DOD) progress in implementing the Joint Incentive Fund (JIF) 

and Demonstration Site Selection (DSS) programs, including whether they 

are operational, we visited VA and DOD medical facilities at six sites—

Augusta, Georgia; Honolulu, Hawaii; North Chicago, Illinois; El Paso, 

Texas; San Antonio, Texas; and Puget Sound, Washington, and interviewed 

department officials responsible for the development and implementation

of each of the projects and conducted site visits at select sites. In addition, 

we contacted VA and DOD officials from seven additional sharing sites.1

For all of the sites, we reviewed approved business case analyses for JIF 

projects selected in fiscal year 2004 and DSS projects that included 

detailed descriptions of the projects, timelines for development and 

implementation, associated risks, costs, potential cost savings (if 

applicable), staffing requirements, and quarterly progress reports. We also 

obtained and reviewed VA and DOD policies governing sharing and 

reviewed relevant department reports, including those from the DOD 

Inspector General and DOD contractors, along with our prior work. 

To obtain information on the actions taken by VA and DOD to strengthen 

the sharing of health care resources, we interviewed officials from VA’s 

Office of Policy, Planning, and Preparedness and the Veterans Health 

Administration—including the VA/DOD Liaison Office and VA medical 

center (VAMC) staff at several locations engaged in the sharing of health

care resources. We interviewed officials from DOD’s TRICARE 

Management Activity;2

 DOD/VA Program Coordination Office; the military 

services’ surgeons general offices, which coordinate sharing activities; and

several military treatment facilities (MTF) engaged in the sharing of health

care resources. We also interviewed officials from Joint Executive Council 

(JEC) committees and Health Executive Council (HEC) workgroups3

 to 

determine what policies, procedures, and guidance have been 

promulgated to promote health care resource sharing and coordination 

 1

Those seven additional sharing sites were located in the following areas: Alaska, 

California, Kansas, New York, North Dakota, South Carolina, and Virginia. 

2

DOD provides health care through TRICARE—a regionally structured program that uses 

civilian contractors to maintain provider networks to complement health care services 

provided at MTFs. 

3

VA and DOD established JEC along with four additional interagency councils/committees 

to further facilitate collaboration between the departments in areas such as strategic 

planning and health care. HEC and its workgroups, which are under the purview of JEC,

were developed as a mechanism to specifically further the sharing of health care resources 

between VA and DOD. 

Page 33 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix I: Scope and Methodology 

between VA and DOD. Further, we spoke with officials from the Office of 

Management and Budget (OMB). We reviewed the charters, when 

available, and briefing updates for each JEC committee and HEC 

workgroup and OMB’s scorecards for the President’s Management Agenda 

initiative directed at VA and DOD sharing. We analyzed sharing data 

between VA and each branch of service that included workload, sharing 

agreements, and cost data. We also reviewed the actions taken by both VA 

and DOD to strengthen the sharing of health care resources. In addition, 

we evaluated whether health care resource-sharing activities were 

considered as part of Capital Asset Realignment for Enhanced Services 

and base realignment and closure decisions. 

To assess whether VA and DOD performance measures are useful, we 

interviewed officials from VA’s Office of Policy, Planning, and 

Preparedness and the Veterans Health Administration—including the 

VA/DOD Liaison Office and VAMC staff at several locations engaged in the 

sharing of health care resources. We also interviewed officials from DOD’s 

TRICARE Management Activity; the DOD/VA Program Coordination 

Office; the military services’ surgeons general offices, which coordinate 

sharing activities; and several MTF locations engaged in the sharing of 

health care resources. We analyzed the VA/DOD joint strategic plan,4

 VA’s 

strategic plan,

5

 DOD’s Military Health System Strategic Plan,6 VA’s 

performance and accountability report,7

 DOD’s performance and 

accountability report,8

 and VA/DOD’s annual report to the Congress on 

sharing.9

We conducted our work from January 2005 through March 2006 in 

accordance with generally accepted government auditing standards. 

 4

Department of Veterans Affairs/Department of Defense, VA/DOD Joint Strategic Plan 

(Washington, D.C.: December 2004). 

5

Department of Veterans Affairs, Office of the Secretary, Strategic Plan 2003-2008 

(Washington D.C.: July 2003). 

6

Department of Defense, Military Health System Strategic Plan (September 2002). 

7

Department of Veterans Affairs, Office of Management, FY 2004 Annual Performance and

Accountability Report (Washington, D.C.: November 2004). 

8

Department of Defense, Performance and Accountability Report, Fiscal Year 2004 

(Nov. 15, 2004).

9

Department of Veterans Affairs/Department of Defense, VA/DOD Joint Executive Council

Annual Report (Washington, D.C.: December 2004). 

Page 34 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix II: Joint Incentive Fund Program 

VA partner DOD partner Project description 

Dollar amount of 

project

JIF fiscal year 2004 projects

VA Pacific Islands 

Health Care System, Hawaii 

Tripler Army Medical

Center, Hawaii

Delta Systems II-Cad/Cam System: This is a 

fabrication technology system that produces 

molds for prosthetics and orthotics from 

lightweight foam through use of a laser scanner 

and mill. Installing this device at Tripler should

allow for greater patient access; reduce clinic

visits for casting, adjustments, and fittings; and 

allow for an increase in VA beneficiary access. 

$542,000

Fargo Veterans Affairs 

Medical Center, North Dakota 

319th Medical Group, 

Grand Forks Air Force 

Base, North Dakota 

Joint TeleMental System: Acquiring 

videoconferencing technology should allow VA

to provide mental health services to DOD 

beneficiaries approximately 80 miles away. 

$14,000

VA Northern 

California Health Care System, 

California 

60th Medical Group, Travis 

Air Force Base, California 

Joint Dialysis Unit: Through upgrading 

equipment and increased staffing, Travis Air 

Force Base’s dialysis unit is expected to be

able to accommodate VA beneficiaries. 

$1,568,560

North Chicago Veterans Affairs 

Medical Center, Illinois 

Naval Hospital Great 

Lakes, Illinois 

Mammography Unit Expansion: The purchase 

of new digital mammography equipment, a 

stereotactic unit, and hiring of support staff 

should now reduce wait times for DOD 

beneficiaries and allow for VA beneficiary 

access. 

$655,000

Spokane Veterans Affairs 

Medical Center, Washington 

92nd Medical Group, 

Fairchild Air Force Base, 

Washington 

Teleradiology Initiative: This will upgrade 

DOD’s system so it can download images from

VA for radiological interpretation and is 

intended to allow VA to provide computed

tomography scans for DOD patients. 

$333,537

North Chicago Veterans Affairs 

Medical Center, Illinois 

Naval Hospital

Great Lakes, Illinois 

Women’s Health Center: This project proposes 

to create a comprehensive women’s health 

center for VA and DOD beneficiaries by 

coordinating women’s services and includes 

hiring gynecology, wellness, and case 

management staff. 

$1,315,332

Alaska Veterans Affairs 

Health Care System, Alaska 

3rd Medical Group, 

Elmendorf Air Force Base, 

Alaska 

Enhanced Outpatient Diagnostic Services: The 

acquisition of diagnostic equipment is intended 

to provide in-house imaging services to VA and 

DOD beneficiaries. 

$535,000

Syracuse Veterans Affairs 

Medical Center, New York 

Fort Drum, New York Telepsychiatry: The hiring of a full-time VA 

psychiatrist is intended to allow VA to provide 

mental health services to DOD patients via 

videoconferencing. 

$330,000

Appendix II: Joint Incentive Fund Program 

Page 35 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix II: Joint Incentive Fund Program 

VA partner DOD partner Project description 

Dollar amount of 

project

Robert J. Dole Veterans Affairs 

Medical Center, Kansas 

22nd Medical Group, 

McConnell Air Force Base, 

Kansas 

Cardiac Catheterization Laboratory: 

Remodeling existing VA space is intended to

accommodate new equipment and provide inhouse cardiac services to VA and DOD 

beneficiaries. 

$3,539,722

Dorn Veterans Affairs 

Medical Center, 

South Carolina

Moncrief Army Community 

Hospital and 20th Medical 

Group, Shaw Air Force 

Base, South Carolina 

Expansion of Existing Magnetic Resonance 

Imaging Joint Venture: The acquisition of an

open magnetic resonance imaging unit located 

at Moncrief Army Community Hospital is 

intended to provide in-house services to VA 

and DOD beneficiaries. 

$2,014,000

South Texas 

Veterans Health Care System, 

Texas 

Wilford Hall Medical 

Center, Texas

North Central San Antonio Clinic: The 

establishment of a joint VA/DOD clinic is 

intended to provide greater access for VA and 

DOD beneficiaries. 

$11,974,197

JIF fiscal year 2005 projects

Veterans Health Administration

Central Office 

DOD TRICARE 

Management Activity 

Medical Enterprise Web Portals: The project is

designed to standardize VA and DOD’s Web

portals—they both will have the same “look and 

feel” to them from a beneficiary perspective, 

including a requirement that each portal meets 

national standards regarding accessibility for 

people with disabilities. 

$2,501,000

Veterans Health Administration

Central Office 

Defense Supply Center, 

Philadelphia 

Medical/Surgical Supply Data Sync: This 

project is intended to create a joint VA and 

DOD medical/surgical supply catalog. 

According to the project plan, the catalog will

ultimately allow VA and DOD to jointly identify 

common medical/surgical products procured

and maximize joint buying power for these 

products through negotiated volume purchase 

contracts. 

$4,500,000

Louisville Veterans Affairs 

Medical Center, Kentucky 

Ireland Army Community 

Hospital, Fort Knox, 

Kentucky 

Radiology: The hiring of additional radiologists

is intended to fully utilize existing equipment 

and provide greater access for VA and DOD 

beneficiaries. 

$1,185,684

Harry S. Truman Memorial 

Veterans’ Hospital, Missouri 

General Leonard Wood 

Army Community Hospital 

and 509th Medical Group, 

Whiteman Air Force Base, 

Missouri 

Sleep Lab Expansion: The renovation and 

expansion, from two beds to four beds, of the 

VA Sleep Diagnostic and Treatment Lab is 

intended to decrease wait times for VA 

beneficiaries and allow for DOD beneficiary

access. 

$436,113

Veterans Affairs Puget Sound

Health Care System, 

Washington 

Madigan Army Medical

Center, Washington 

Cardiac Surgery: The consolidation of VA and 

DOD cardiac surgery programs into a 

coordinated single large cardiac program is 

intended to improve quality of care for VA and 

DOD beneficiaries while achieving efficiencies 

and economies of scale. 

$1,626,427

Page 36 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix II: Joint Incentive Fund Program 

VA partner DOD partner Project description 

Dollar amount of 

project

Veterans Affairs Puget Sound

Health Care System, 

Washington 

Madigan Army Medical

Center, Washington 

Neurosurgery Program: This project is intended 

to improve the provision of neurosurgical care 

to VA and DOD beneficiaries by jointly 

recruiting neurosurgeons. 

$716,000

Veterans Affairs Pacific Islands 

Health Care System, Hawaii 

Tripler Army Medical

Center, Hawaii

Dialysis: By providing the staff necessary to 

optimally utilize an existing DOD dialysis 

center, this project is intended to increase 

access for VA beneficiaries. 

$2,752,942

Veterans Affairs Pacific Islands 

Health Care System, Hawaii 

Tripler Army Medical

Center, Hawaii

Pain Management Improvement: Converting an 

anesthesiologist who specializes in pain 

rehabilitation from part-time to full-time is 

intended to recapture pain management 

workload that is currently being outsourced and 

decrease beneficiary wait times. 

$707,000

North Chicago Veterans Affairs 

Medical Center, Illinois 

Naval Hospital Great 

Lakes, Illinois 

Joint Magnetic Resonance Imaging: The 

acquisition of an open field magnetic 

resonance imaging unit and the hiring of a 

radiologist are intended to reduce patient wait

time, referrals for contract care, delays in

treatment, and length of stay for acutely ill 

patients. 

$3,449,000

North Chicago Veterans Affairs 

Medical Center, Illinois 

Naval Hospital Great 

Lakes, Illinois 

Clinical Fiber-Optics: By providing the 

necessary high-speed clinical connectivity 

between VA and DOD facilities, this project is

intended to provide the bandwidth needed to 

transmit clinical images to VA.

$247,245

North Chicago Veterans Affairs 

Medical Center, Illinois 

Naval Hospital Great 

Lakes, Illinois 

Oncology: This project is intended to create a

hematology-oncology program for VA and DOD 

beneficiaries, who are currently referred to the 

local community. 

$600,000

South Texas Veterans 

Health Care System, Texas 

Wilford Hall Medical Center 

and Brooke Army Medical 

Center, Texas

Digital Imaging: The seamless sharing of digital 

images, texts, and patient demographic 

information between clinical VA and DOD 

systems is intended to be a pilot data 

exchange program. 

$3,450,000

South Texas Veterans 

Health Care System, Texas 

Wilford Hall Medical Center 

and Brooke Army Medical 

Center, Texas

Hyperbaric Medicine: Modifications to the DOD 

facility to allow for the installation of a 

hyperbaric chamber that is intended to provide 

greater access and decrease surgical wait 

times for VA and DOD beneficiaries. 

$1,170,000

Cheyenne and Sheridan 

Veterans Affairs Medical 

Centers, Wyoming 

F. E. Warren 

Air Force Base, Wyoming 

Mobile Magnetic Resonance Imaging: This 

project is intended to provide access to VA and 

DOD beneficiaries through the acquisition of a 

mobile magnetic resonance imaging unit. 

$2,000,000

Page 37 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix II: Joint Incentive Fund Program 

VA partner DOD partner Project description 

Dollar amount of 

project

Boise Veterans Affairs Medical

Center, Idaho 

366th Medical Group, 

Mountain Home 

Air Force Base, Idaho 

Mobile Magnetic Resonance Imaging: Site 

preparation and the acquisition of a mobile 

magnetic resonance imaging unit along with a 

digital printer are intended to recapture 

magnetic resonance imaging exams that are

currently purchased in the local community, 

thereby improving access for VA and DOD 

beneficiaries. 

$2,090,000

Veterans Integrated Service

Network Support Service 

Center 

Air Force Medical 

Operations Agency 

Healthcare Planning Data Mart: This project 

plans to develop a joint VA and Air Force 

database to capture the amount of care each

contracts for outside of its respective health 

care system. Through the creation of the 

database, VA and Air Force managers hope to 

identify areas in which they can jointly 

purchase services and achieve savings 

through leveraged buying power. 

$1,067,756

Veterans Affairs Black Hills 

Health Care System, 

South Dakota 

28th Medical Group, 

Ellsworth Air Force Base, 

South Dakota 

Mobile Magnetic Resonance Imaging: The 

acquisition of a mobile magnetic resonance 

imaging unit is intended to recapture magnetic

resonance imaging exams that are currently 

purchased in the local community, thereby 

improving access for VA and DOD 

beneficiaries. 

$2,000,000

Sources: VA and DOD.

Note: Projects may be funded over a 2-year period.

Page 38 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix III: Demonstration Site Selection 

Projects for Fiscal Years 2003 through 2007 

VA partner DOD partner Category Project description 

Estimated total 

dollar amount of 

project

Veterans Affairs 

Pacific Islands 

Health Care 

System, Hawaii

Tripler Army 

Medical Center, 

Hawaii 

Budget and Financial 

Management System 

Joint Venture Operations Revenue Cycle—

The goal of this project is to conduct and 

execute the findings of studies in four key 

areas. (1) Health Care Forecasting, Demand 

Management, and Resource Tracking: 

Define, test and implement a system that will

combine VA and DOD data for beneficiaries 

receiving care in the Pacific Islands joint 

venture market. This will include all eligibility,

insurance, administrative, clinical, staffing, 

and costing data that will allow VA and DOD 

to query and output information on utilization

and demand, supply and capacity, combined 

costs, facility and staff, services, and 

beneficiary population. (2) Referral 

Management and Fee Authorization: Define, 

test, and implement a system that will provide 

the capability of timely tracking of 

authorizations, obligations, and provisions of 

clinical care to beneficiaries referred from one 

department to the other. (3) Joint Charge 

Master Based Billing: Define, test, and 

implement a system that will provide DOD 

with the capability for itemized billing and 

patient-level costing. (4) Document 

Management: Define, test, and implement a 

system that gives VA and DOD the capability 

to support all the business and clinical 

processes of sharing care. 

$4,152,000

Alaska Veterans 

Affairs Health 

Care System, 

Alaska 

3rd Medical 

Group, Elmendorf 

Air Force Base, 

Alaska 

Budget and Financial 

Management System 

Joint Venture Business Directorate—This 

project intends to achieve the following goals:

(1) Through the use of a joint business office, 

evaluate areas of business collaboration as 

VA moves its main operation next door to the 

existing joint venture hospital. Areas for 

possible sharing include library, warehouse, 

radiology, ambulatory surgery, central sterile 

supply, GI procedure space, education 

facilities, physical plant utilities, security 

services, and patient transportation. 

(2) Generate itemized bills and utilize the 

existing VA fee program to capture workload

and patient-specific health information. 

(3) Create a coordinated calculation of costbased expenses to assist in market area 

procurement decisions. 

$4,782,000

Appendix III: Demonstration Site Selection 

Projects for Fiscal Years 2003 through 2007 

Page 39 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix III: Demonstration Site Selection 

Projects for Fiscal Years 2003 through 2007 

VA partner DOD partner Category Project description 

Estimated total 

dollar amount of 

project

Augusta Veterans 

Affairs Medical

Center, Georgia

Eisenhower Army 

Medical Center, 

Georgia 

Coordinated Staffing 

and Assignment 

System 

Joint Staffing—VA and DOD plan to jointly to 

recruit, hire, and train staff for difficult-to-fill 

direct patient care occupations, which provide

clinical and ancillary support services. 

Specifically, the project is designed to 

(1) utilize the Augusta VAMC’s successful 

recruitment initiatives to aid DOD in hiring 

staff for direct patient care positions it has 

been unable to fill, (2) unite training initiatives

so direct patient care staff may take 

advantage of training opportunities at either 

facility, and (3) hire and train a select group 

of staff that would service either facility when

a critical staffing shortage occurred. 

$2,880,000

Hampton, 

Veterans Affairs 

Medical Center, 

Virginia 

1st Medical

Group, Langley Air 

Force Base, 

Virginia 

Coordinated Staffing 

and Assignment 

System 

Coordinated Staffing Initiative—The goals of 

this project are intended to achieve the 

following: (1) Develop a process to identify 

department-specific needs to address staffing 

shortfalls for integrated services. (2) Create a 

method to compare, reconcile, and integrate 

requirements between facilities. 

(3) Determine a payment methodology to 

support the procurement process for staffing 

shortfalls. (4) Establish a joint referral and 

appointment process, to include allocation of

capacity and prioritization of workload. 

(5) Maintain an ongoing assessment of 

issues and problem resolution.

$780,000

Veterans Affairs 

Puget Sound, 

Health Care 

System, 

Washington 

Madigan Army 

Medical Center, 

Washington 

Medical Information/ 

Information 

Technology 

Management System 

Health Care Data Exchange—The goal of 

this project is to transmit a limited subset of 

currently available clinical data between VA 

and DOD. The intent of this project is to work

with the developers of Composite Health 

Care System II (CHCS II), Bidirectional 

Health Information Exchange (BHIE), and 

Computerized Patient Record System, to 

exchange and view data such as discharge 

summaries. 

$14,865,000

Page 40 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix III: Demonstration Site Selection 

Projects for Fiscal Years 2003 through 2007 

VA partner DOD partner Category Project description 

Estimated total 

dollar amount of 

project

El Paso Veterans 

Affairs Health 

Care System, 

Texas 

William Beaumont 

Army Medical 

Center, Texas

Medical Information/ 

Information 

Technology 

Management System 

Laboratory Data Sharing—with CHCS II 

modifications: Phase I is the implementation

of the Laboratory Data Sharing Initiative 

(LDSI) with the CHCS II modification. LDSI 

implementation is intended to eliminate 

rekeying of orders entered by VA providers in

VA’s Veterans Health Information Systems 

and Technology Architecture (VISTA) into 

DOD’s CHCS II, decrease errors caused by 

transcription, and increase speed of lab 

results availability to VA providers for 

treatment purposes. Phase II will be the 

implementation of the BHIE project, which is 

currently being deployed, with the CHCS II 

modification. Initial focus will be on data 

sharing related to patient demographic 

information, outpatient pharmaceuticals 

prescribed to patient populations, and allergy 

information. Phase III expands on the initial 

development of the BHIE project by including 

the data sharing of radiology reports (text) 

and laboratory results, including anatomic 

pathology. 

$3,058,000

South Texas 

Veterans Health 

Care System, 

Texas 

Wilford Hall

Medical Center

and Brooke Army 

Medical Center, 

Texas 

Medical Information/ 

Information 

Technology 

Management System 

Laboratory Data Sharing—VA’s VISTA to 

DOD’s Composite Health Care System I 

(CHCS I). LDSI is intended to meet the need 

of receiving electronic patient test results 

from reference labs, thereby eliminating 

manual data entry of such results. The goal is 

to create bidirectional communication 

between VISTA and CHCS I to facilitate 

ordering, sending, and receiving of all lab test

subscripts (including chemistry, anatomic 

pathology, and microbiology). Tangible 

benefits include more efficient use of manhours from not having to manually enter test 

results and improved turnaround time for the 

providers to receive results. Intangible 

benefits include increased patient safety via 

the elimination of manual test results. 

$3,923,000

Page 41 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix III: Demonstration Site Selection 

Projects for Fiscal Years 2003 through 2007 

VA partner DOD partner Category Project description 

Estimated total 

dollar amount of 

project

South Texas 

Veterans Health 

Care System, 

Texas 

Wilford Hall

Medical Center

and Brooke Army 

Medical Center, 

Texas 

Medical Information/ 

Information 

Technology 

Management System 

Joint Credentialing System—VA and DOD 

plan to jointly credential licensed providers 

based on an interface between DOD’s 

Centralized Credentials Quality Assurance 

System (CCQAS) and VetPro, VA’s 

credentialing system. The project is divided 

into four phases: Phase I–Implement the 

current version of CCQAS that is available at

the time of implementation with the interface.

Phase II–Create a means to provide the 

capability to view credentialing files and 

scanned primary source verification 

documentation in either system by VA or 

DOD staff. Phase III–Expand the use of 

credentialing in VetPro at VA and CCQAS at

DOD to include nurses and other licensed 

professionals. Phase IV–Explore the 

feasibility of a local centralized site for 

primary source verification. 

$2,554,000

Sources: VA and DOD.

Page 42 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix IV: Description of VA’s and DOD’s Appendix IV Councils, Committees, and Workgroups : Description of VA’s and DOD’s 

Councils, Committees, and Workgroups 

Joint Executive Council (JEC): Established in February 2002, VA and 

DOD’s JEC was created to enhance VA and DOD collaboration, ensure the 

efficient use of federal resources, remove barriers and address challenges

that impede collaborative efforts, assert and support mutually beneficial 

opportunities to improve business practices, and develop a joint strategic 

planning process to guide the direction of sharing activities. JEC is cochaired by the Deputy Secretary of Veterans Affairs and the Under 

Secretary of Defense for Personnel and Readiness. Membership consists of 

senior leaders from both VA and DOD, including VA’s Under Secretary for 

Benefits and Under Secretary for Health and DOD’s Principal Deputy 

Under Secretary of Defense for Personnel and Readiness and Assistant 

Secretary for Health Affairs. JEC has two interagency councils and two 

interagency committees to further facilitate collaboration and sharing 

opportunities: (1) the Benefits Executive Council, (2) the Joint Strategic 

Planning Committee, (3) the Construction Planning Committee, and 

(4) the Health Executive Council. JEC’s primary responsibility is to set 

strategic priorities for the four interagency councils and committees, 

monitor the development and implementation of the Joint Strategic Plan,

and ensure accountability is incorporated into all joint initiatives. 

Benefits Executive Council (BEC): Established by JEC in August 2003, 

BEC was charged with examining ways to expand and improve 

information sharing, refine the process of records retrieval, identify 

procedures to improve the benefits claims process, improve outreach, and

increase servicemembers’ awareness of potential benefits. In addition, 

BEC provides advice and recommendations to JEC on issues related to 

seamless transition from active duty to veteran status through a 

streamlined benefits delivery process, including the development of a 

cooperative physical examination process and the pursuit of 

interoperability and data sharing. 

Joint Strategic Planning Committee: Established by JEC in October 

2002, the committee was charged with developing a joint strategic plan 

that through specific initiatives, would improve the quality, efficiency, and 

effectiveness of the delivery of benefits and services to both VA and DOD 

beneficiaries through enhanced collaboration and sharing. 

VA/DOD Construction Planning Committee (CPC): Established by 

JEC in August 2003, CPC provides a formalized structure to facilitate 

cooperation and collaboration in achieving an integrated approach to 

capital coordination that considers both short-term and long-term 

strategic capital issues. CPC was charged with providing oversight to 

ensure that collaborative opportunities for joint capital asset planning are 

Page 43 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix IV: Description of VA’s and DOD’s

Councils, Committees, and Workgroups 

maximized, and provides the final review and approval of all joint capital

asset initiatives recommended by any element of JEC structure. 

Health Executive Council (HEC): In 1997, VA and DOD established 

HEC—a precursor to JEC. HEC was co-chaired by the VA Under Secretary 

for Health and the Assistant Secretary of Defense (Health Affairs). JEC 

rechartered HEC in August 2003 to oversee the cooperative efforts of each 

department’s health care organizations. HEC has charged workgroups to 

focus on specific high-priority areas of national interest. HEC has 

organized itself into 11 workgroups to carry out its mission—to 

institutionalize VA and DOD sharing and collaboration through the 

efficient use of health services and resources. 

HEC Workgroups: 

1. Contingency Planning: The workgroup is responsible for developing 

collaborative efforts in support of the VA and DOD Contingency Plan 

and the National Disaster Medical System. Through the workgroup, VA 

and DOD are in the process of jointly updating the memorandum of 

understanding regarding VA furnishing health care services to

members of the armed forces during a war or national emergency. 

2. Continuing Education and Training: The workgroup is responsible 

for developing a shared training infrastructure and for designing, 

developing, and managing the operational procedures to facilitate 

increased sharing of education and training opportunities between VA 

and DOD. 

3. Deployment Health: The workgroup is responsible for enhancing 

health care available to servicemembers returning from overseas 

deployment. Focusing on health risks associated with specific 

deployments, the group developed proactive approaches toward 

deployment health surveillance, health risk communication, and early 

identification and treatment of deployment-related health problems. 

4. Evidence-Based Practice Guidelines: The workgroup is responsible 

for the creation and publication of jointly used guidelines for disease 

management. 

5. Financial Management: The workgroup is responsible for developing

and disseminating principles and procedures, interpreting current 

policies and guidance, establishing policies to be used in creating 

reimbursable arrangements, and resolving disputed issues related to 

such arrangements that cannot be resolved at local or intermediate 

Page 44 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix IV: Description of VA’s and DOD’s

Councils, Committees, and Workgroups 

organizational levels. The workgroup is also responsible for the 

implementation of JIF. 

6. Graduate Medical Education (GME): The workgroup is responsible 

for reviewing the current state of the GME1

 program between both 

departments, and implementing the joint pilot program for GME under 

which graduate medical education and training is provided to military 

physicians and physician employees of DOD and VA through one or 

more programs carried out in DOD’s military MTFs and VAMCs, as 

mandated by legislation in December 2002.2

7. Joint Facility Utilization and Resource Sharing: The workgroup is 

responsible for examining issues such as removing barriers to resource 

sharing and streamlining the process for approving sharing 

agreements. The workgroup was originally tasked with identifying 

areas for improved resource utilization through local and regional 

partnerships, assessing the viability and usefulness of interagency 

clinical agreements, identifying impediments to sharing, and

identifying best practices for sharing resources. The workgroup was 

responsible for providing oversight of the DOD/VA Joint Assessment 

Study mandated by the Department of Defense and Emergency 

Supplemental Appropriations for Recovery from and Response to 

Terrorist Attacks on the United States Act, 2002.

3

 The workgroup is 

also responsible for the implementation of DSS. 

8. Information Management/Information Technology: The 

workgroup is responsible for developing interfaces and implementing 

standards to facilitate interoperability for improving exchange of 

health data between VA and DOD. 

9. Medical Materiel Management: In lieu of a charter, VA and DOD 

officials signed a memorandum of agreement. Under the terms of the 

memorandum, the workgroup is to “combine identical medical supply 

requirements from both agencies and leverage that volume to negotiate 

better pricing.” 

 1

GME is the second phase of medical education, and prepares physicians for practice in a

medical specialty or subspecialty. 

2

Pub. L. No. 107-314 § 725, 116 Stat. at 2599. 

3

Pub. L. No. 107-117 § 8147, 115 Stat. 2230, 2280-81. 

Page 45 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix IV: Description of VA’s and DOD’s

Councils, Committees, and Workgroups 

10. Patient Safety: The workgroup is responsible for reviewing and 

developing internal and external reporting systems for patient safety. 

DOD has established a Patient Safety Center at the Armed Forces 

Institute of Pathology using the VA National Center for Patient Safety

as a model. 

11. Pharmacy: The workgroup is responsible for expanding participation 

by the VA Pharmacy Benefits Management Strategic Health Care 

Group and the DOD Pharmacoeconomic Center to evaluate high-dollar 

and high-volume pharmaceuticals jointly. According to the workgroup, 

it is overseeing joint actions, such as joint contracts involving highdollar and high-volume pharmaceuticals, which are designed to 

increase uniformity and improve the clinical and economic outcomes 

of drug therapy in the VA and DOD health systems. The workgroup’s 

goals include eliminating unnecessary redundancies that exist in areas 

of class reviews, contracting prescribing guidelines, and utilization 

management. 

Page 46 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix V: Comments from the Department Appendix V of Veterans Affairs : Comments from the Department 

of Veterans Affairs 

Page 47 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix V: Comments from the Department 

of Veterans Affairs 

Page 48 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix VI: Comments from the Department Appendix VI: Comments from the of Defense 

Department of Defense 

Page 49 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix VI: Comments from the Department 

of Defense 

Page 50 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix VI: Comments from the Department 

of Defense 

Page 51 GAO-06-315 VA and DOD Health Care Resource Sharing 
Appendix VI: Comments from the Department 

of Defense 

Page 52 GAO-06-315 VA and DOD Health Care Resource Sharing 
Related GAO Products Related GAO Products 

Results-Oriented Government: Practices That Can Help Enhance and 

Sustain Collaboration among Federal Agencies. GAO-06-15. Washington,

D.C.: October 21, 2005. 

VA and DOD Health Care: VA Has Policies and Outreach Efforts to 

Smooth Transition from DOD Health Care, but Sharing of Health 

Information Remains Limited. GAO-05-1052T. Washington, D.C.: 

September 28, 2005. 

Computer-Based Patient Records: VA and DOD Made Progress, but Much 

Work Remains to Fully Share Medical Information. GAO-05-1051T. 

Washington, D.C.: September 28, 2005. 

Mail Order Pharmacies: DOD’s Use of VA’s Mail Pharmacy Could 

Produce Savings and Other Benefits. GAO-05-555. Washington, D.C.: June 

22, 2005. 

DOD and VA Health Care: Incentives Program for Sharing Health 

Resources. GAO-05-310R. Washington, D.C.: February 28, 2005. 

VA and DOD Health Care: Resource Sharing at Selected Sites. 

GAO-04-792. Washington, D.C.: July 21, 2004. 

DOD and VA Health Care: Incentives Program for Sharing Resources. 

GAO-04-495R. Washington, D.C.: February 27, 2004. 

DOD and VA Health Care: Access for Dual Eligible Beneficiaries. 

GAO-03-904R. Washington, D.C.: June 13, 2003. 

VA and Defense Health Care: Increased Risk of Medication Errors for 

Shared Patients. GAO-02-1017. Washington, D.C.: September 27, 2002. 

VA and Defense Health Care: Potential Exists for Savings through Joint 

Purchasing of Medical and Surgical Supplies. GAO-02-872T. Washington,

D.C.: June 26, 2002. 

DOD and VA Pharmacy: Progress and Remaining Challenges in Jointly

Buying and Mailing Out Drugs. GAO-01-588. Washington, D.C.: May 25,

2001. 

VA and Defense Health Care: Evolving Health Care Systems Require 

Rethinking of Resource Sharing Strategies. GAO/HEHS-00-52. 

Washington, D.C.: May 17, 2000. 

(290277) Page 53 GAO-06-315 VA and DOD Health Care Resource Sharing 
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