The National Defense Authorization Act for Fiscal Year 2008 (NDAA) directed DOD to establish centers of excellence for traumatic brain injury and post-traumatic stress disorder. Although the NDAA described responsibilities for the centers, it did not specify where the centers should be located within the DOD organization. Instead, it directed the Secretary of Defense to ensure that to the maximum extent practicable centers collaborate with governmental, private, and nonprofit entities. Senior-level DOD officials convened representatives from the Army, Navy, Air Force, Marines, and Department of Veterans Affairs to determine how to establish the centers. Informally, this group was known as the “Red Cell” and its primary mission was to address recommendations related to PH and TBI. Rather than establishing separate centers of excellence for traumatic brain injury and post-traumatic stress disorder, a combined center for both PH and TBI was created. According to one representative, the Red Cell also debated how funding would be divided between PH and TBI and across the military services. The military services, TMA, and DCOE receive PH and TBI funding through the Defense Health Program (DHP) appropriation account. Organizationally the services are led by Secretaries who have a direct relationship with the Secretary of Defense. As shown in figure 1, DCOE reports directly to the Assistant Secretary of Defense for Health Affairs/Director of TMA within the Office of the Secretary of Defense. DCOE consists of a central office and six directorates. The central office conducts multiple functions such as leadership and resource management and is responsible for DCOE’s budget formulation process. The six directorates carry out a range of activities related to PH and TBI, including operating a call center, disseminating information on DOD training programs, developing clinical practice guidelines related to PH and TBI, and identifying PH and TBI research needs. The DCOE network also includes five component centers that provide an established body of knowledge and experience related to PH and TBI. The component centers are the Defense and Veterans Brain Injury Center (DVBIC), Deployment Health Clinical Center (DHCC), Center for the Study of Traumatic Stress (CSTS), Center for Deployment Psychology (CDP), and the National Center for Telehealth and Technology (T2). Over time, PH and TBI funding evolved from DHP amounts directed specifically for PH and TBI to funding support being incorporated into the broader DHP appropriation. In fiscal year 2007, Congress appropriated approximately $600 million specifically for TBI and post-traumatic stress disorder treatment. In fiscal year 2008, Congress specifically appropriated $75 million for PH and TBI activities. In fiscal year 2009, funding for PH and TBI was not appropriated a specific amount, rather funding was drawn from DHP’s general operation and maintenance funds—DOD had discretion over the amount and distribution of funds internally allotted. Beginning in fiscal year 2010, PH and TBI funding was included in the base budget request for the DHP, which established a longer-term funding stream for PH and TBI. As shown in figure 2, in fiscal year 2010 a total of $638 million in DHP operations and maintenance funding was allotted for PH and TBI across the military services, TMA Financial Operations Division (TMA FOD), and DCOE. The Army received the largest portion of funds, about $279 million or 44 percent, while DCOE received approximately $168 million or 26 percent. Of all PH and TBI funding allotted, $96 million or 15 percent was suballoted to component centers within the DCOE network. Budget formulation for DOD occurs as part of the Planning, Programming, Budgeting and Execution Process, which projects near-term defense spending. The system is intended to provide defense decision makers with the data they need to make trade-offs among potential alternatives; thus resulting in the best possible mix of forces, equipment, and support to accomplish DOD’s mission. Specifically, DOD budget formulation occurs in the programming phase of the Planning, Programming, Budgeting and Execution Process, and begins with the development of a program objective memorandum (POM). The POM reflects decisions about resource allocations and proposed budget estimates and is used to inform the development of the President’s Budget and DOD Congressional Justifications. Because DCOE is only one, relatively small entity receiving funds through the broader DHP appropriation, it is not visible in DOD budget presentation materials. The POM covers six fiscal years and is developed in even fiscal years, for example fiscal year 2008 and fiscal year 2010. DOD develops the POM approximately 18 months in advance of the first fiscal year the POM covers. DCOE had a limited role in budget decision making for the fiscal year 2012 POM process. Ultimately, senior DOD officials, including the Health Affairs Deputy Assistant Secretaries of Defense, decided to fund 1 of 18 PH and TBI requests, which did not include DCOE’s. For this POM, DCOE headquarters solicited and received budget requests from component centers. Ultimately, DCOE accepted and incorporated all component center requests into its budget request. However, in some instances DCOE officials said they requested additional justification from component centers. PH and TBI budget requests from across DOD, including DCOE, were collected for consideration in the fiscal year 2012 POM. A working group of PH and TBI subject matter experts within DOD reviewed and prioritized requests for funding above the fiscal year 2010 base budget from across the department. According to a DCOE official, DCOE’s interests were represented by TMA officials who contributed to the prioritization of these requests; however, the final decisions were not formally communicated to DCOE. DCOE had a limited role in budget formulation for the fiscal year 2010 POM because it was still in its first year of operation. According to a senior DOD official, no limits were imposed on PH and TBI budget requests and no trade-off decisions were made. Nevertheless, this year was significant because it was the first year that DCOE’s budget was considered in the DHP baseline budget request. According to DCOE officials, because DCOE had only recently been established, it had limited staff. In addition, component centers were still being realigned under DCOE and both the relationship between component centers and DCOE and the missions of two component centers, T2 and the National Intrepid Center of Excellence (NICOE), were unclear. For the fiscal year 2008 POM process, the newly established DCOE had no role in budget formulation. Instead, the Red Cell convened to determine how the centers of excellence would be implemented and provided recommendations on DCOE’s original budget, which the Senior Oversight Committee approved. Because the POM process occurred on a biannual basis in even fiscal years, DOD did not have a budget formulation process in fiscal years 2009 and 2011. For the fiscal year 2012 POM, DCOE provided limited narrative support for its budget justification. TMA requested that DCOE complete and submit a spreadsheet template with cost estimates and narrative for resource requests above the prior-year baseline. The narrative portion asked for four elements: (1) background, (2) requirements summary, (3) impact to other programs, and (4) the risk if not funded. DCOE and its component centers did not provide this template in a complete manner. Not all of the requested narrative elements were provided. For example, the impact to other programs was not discussed for half the requests DCOE submitted. In addition, the DCOE headquarters request was calculated with a 3.5 percent inflation factor versus the 1.7 percent prescribed in POM guidance, but DCOE did not explain why it needed to use a higher inflation rate. Two years earlier, for the 2010 POM, DCOE provided no narrative support for its budget justification. TMA requested that DCOE provide completed spreadsheets that did not include a narrative component. For this POM, DCOE differentiated the amounts it requested by PH or TBI strategic initiatives and by commodity, but did not provide narrative justifications for these amounts. Guidance contained in OMB Circular A-11 specifies that the basic requirements for a justification include a description of the means and strategies used to achieve performance goals. Means can include human resources, information technology, and operational processes. Strategies may include program, policy, management, regulatory, and legislative initiatives and approaches and should be consistent with the agency’s improvement plans. According to OMB, a thorough description of the means and strategies to be used will promote understanding of what is needed to achieve a certain performance level and increase the likelihood that the goal will be achieved. To develop a comprehensive departmentwide budget submission to OMB, a thorough description of means and strategies in justifications is needed at all levels within an agency. DCOE already collects information that could improve its budget justifications. DCOE requests that both directorates and component centers prepare “fact sheets,” which contain detailed information including mission, activities, relevant legislation, staffing, performance metrics, and resource requirements. Information like that in the fact sheets provides an expanded discussion of performance information. DCOE and TMA could leverage this existing information to improve budget justifications and resulting decisions. Decision making for DCOE’s budget formulation could be facilitated by key information, such as funding and obligations data, additional non- DCOE funding received by its component centers, and performance information resulting from internal reviews. This information could also help DCOE justify and prioritize its budget requests. However, DOD required more than 3 months to query numerous sources and provide us with prior-year data on funding and obligations for DCOE and its component centers. The absence of readily available, comprehensive historical funding and obligations data indicates that TMA and DCOE did not have benefit of these data to inform budget formulation.