In 1862, the Army Surgeon General established a repository in the Army Medical Museum for disease specimens collected from Civil War soldiers. The Army Institute of Pathology was created as a part of the museum in 1944, using the museum’s extensive collection of disease specimens to develop expertise in diagnostic pathology. In 1949, the Army Institute of Pathology was renamed the Armed Forces Institute of Pathology, and the museum became a unit within AFIP. In 1976, the Department of Defense Appropriation Authorization Act for Fiscal Year 1977 established AFIP in its current form, as a joint entity of the Departments of the Army, Navy, and Air Force, to offer pathologic support to military and civilian medicine in consultation, education, and research. Throughout the early part of the 20th century, AFIP was the only institution in the country that maintained expertise in every major area of anatomical pathology, attracting large numbers of consultations, trainees, and research grants on the basis of the institute’s unique reputation. However, according to AFIP’s Scientific Advisory Board, many changes in modern medical practice over the last several decades have altered the environment in which AFIP operates. For example, AFIP must now compete with over one hundred civilian medical institutions, many of which have in-house experts and comparable subspecialty areas of pathology. AFIP provides pathology expertise for all branches of the military. AFIP also provides pathology expertise for VA in exchange for a specified number of VA staff positions assigned to AFIP. Additionally, AFIP offers pathology expertise on a reimbursable basis for its civilian customers. To assist AFIP in this part of its mission, the Department of Defense Appropriation Authorization Act for Fiscal Year 1977 authorized ARP to be established as a nonprofit corporation with responsibility for encouraging and facilitating collaborative work between AFIP and civilian medicine. As such, ARP enters into contracts, collects fees, and accepts research grants on behalf of AFIP, in support of cooperative enterprises and interchange between military and civilian pathology. From 1998 through 2006, DOD and others conducted reviews that concluded that AFIP lacked controls over its financial operations, provided services for the civilian medical community without adequate reimbursement, and the costs of the services it provided to VA exceeded the value of the paid staff positions VA provided in exchange. These reviews concluded that DOD, in effect, subsidized AFIP’s work for VA and civilian customers. In response to these concerns, AFIP began making changes to its operations in 2000, including the development and implementation of a business plan meant to increase AFIP’s revenue and reduce DOD’s level of funding to AFIP. DOD examined AFIP’s operations as part of the 2005 BRAC process, which was intended to find ways to consolidate, realign, or find alternative uses for current facilities given the U.S. military’s limited resources. In making its 2005 BRAC recommendations, DOD applied statutory selection criteria that included military value, costs and savings, economic impact to local communities, community support infrastructure, and environmental impact. In applying these criteria, the law required that priority consideration be given to military value, and allowed the other criteria to be considered to a lesser extent. In DOD’s evaluation, AFIP received a low military value due to its large portion of civilian-related work. Therefore, DOD recommended disestablishing AFIP by relocating critical military services and terminating civilian-related activities currently provided by AFIP. As part of the BRAC process, the Secretary of Defense issued a report containing his realignment and closure recommendations, which were then reviewed by the BRAC Commission. The 2005 BRAC Commission’s final report contained recommendations to disestablish AFIP and relocate certain services that AFIP provides. These recommendations became binding as of November 9, 2005. In accordance with BRAC statutory authority, DOD must complete closure and realignment actions by September 15, 2011. AFIP pathologists perform diagnostic consultations, education, and research services benefiting DOD, VA, and civilian communities. In 2006, AFIP provided over 40,000 consultations, almost half of which were for DOD physicians. AFIP’s educational services include live courses, distance learning activities, and texts that draw upon pathology material from the repository with the goal of training physicians in diagnosing the most difficult-to-diagnose diseases. DOD, VA, and civilian physicians use AFIP’s educational services, but the civilian community uses AFIP’s educational services more extensively than military physicians. Regarding its research services, AFIP pathologists work individually and in partnership with other federal and private researchers using material from the repository to conduct research applicable to military operations as well as to diagnose and treat diseases affecting military and civilian health. AFIP’s primary mission is to provide diagnostic consultations. Its pathologists spend nearly twice as much time providing this service as they do providing education and research services. AFIP pathologists provide consultations for cases referred to them with and without diagnoses. That is, when physicians—clinicians or general pathologists— at civilian, DOD, or VA medical centers cannot make a diagnosis or when they are unsure of their initial diagnosis and are in need of another opinion, they can send the case to AFIP’s subspecialty pathologists for diagnostic consultation. According to the American Board of Pathology, there are 10 different areas of subspecialty pathology, such as dermatopathology and forensic pathology. Additionally, pathologists are recognized as subspecialists in other areas of pathology pertaining to particular cancers, such as breast or prostate. Requesting physicians— those who send cases to AFIP in search of diagnostic consultations— typically need consultations for more complex cases that require the additional expertise of a subspecialty pathologist. In the course of providing these diagnostic consultations to the requesting physicians, AFIP receives and is able to add pathology material to its repository. As a result, consultations have been instrumental in expanding the repository. Over time, AFIP has increased the amount of services provided for DOD and decreased the amount of services provided for civilians. The total number of diagnostic consultations that AFIP provided remained relatively stable from 2000 to 2004. However, as we previously reported, DOD diagnostic consultations provided by AFIP increased by 30 percent from 2000 through 2004, while its civilian consultations decreased by 28 percent. We also reported that nearly all of the decrease in civilian consultations occurred in the 2 years after AFIP announced that it would raise its consultation fees beginning in January 2003. According to AFIP and civilian pathologists, this decrease in civilian diagnostic consultations was also attributed to a more competitive marketplace for obtaining consultations. Additionally, these pathologists also cited the loss of nationally recognized experts at AFIP as another possible reason for the decline in the number of civilian diagnostic consultations being sent to AFIP. In 2006, AFIP provided almost half of its consultations to DOD physicians. From 2005 to 2006, AFIP decreased the total number of consultations it provided from 44,169 to 41,582. Consistent with earlier trends from 2000 to 2004, AFIP continued to increase the number and percentage of consultations provided to DOD and decrease the amount provided to the civilian community from 2005 to 2006. (See table 1.) In 2006, the largest percentage of consultations, approximately 48 percent, was conducted for DOD, followed by those for VA and civilian physicians at nearly 27 percent and 25 percent, respectively. AFIP also provided about 1 percent of its consultations for others, which included other federal agencies and foreign military services. While AFIP receives consultation requests from all over the world, consultations are heavily concentrated from more populous states and the East Coast. (See app. II for maps of AFIP’s 2006 consultations.) In 2006, about 62 percent (25,621) of AFIP’s cases were for consultations where AFIP pathologists reviewed the initial diagnoses from DOD, VA, civilian, or other physicians for confirmation or change. For these cases, AFIP pathologists changed the initial diagnoses from requesting physicians in 10,987 cases, or about 43 percent of the time. For the remaining 57 percent of the cases (14,634), AFIP confirmed the requesting physicians’ initial diagnoses. When AFIP’s diagnoses differ from the requesting physicians’ initial diagnoses, it classifies the changes as either minor or major. According to AFIP, a minor change often involves a change in severity of the condition diagnosed or the choice of appropriate therapy. For example, the initial diagnosis may have correctly identified a tumor as malignant but may have assigned an incorrect type or level of aggressiveness, which could affect treatment and prognosis. In addition, AFIP classifies a change as major if it involves a change in the nature of the condition diagnosed. For example, a major change would include changing a diagnosis from malignant to benign. Both minor and major diagnosis changes can lead to a different treatment and, ultimately, a different outcome for the patient. As shown in table 2, most of AFIP’s changes to initial diagnoses that were provided by requesting physicians were classified by AFIP as minor changes. The type of consultations DOD, VA, and civilian physicians seek from AFIP differ somewhat, both in terms of the number of cases sent without a diagnoses and the type of pathology expertise requested. For example, 47 percent of DOD’s consultation requests were sent without an initial diagnosis, compared to 27 percent from VA and 31 percent from civilian physicians. This may be due, in part, to the type of expertise DOD and civilian physicians most commonly need, which also differs. For example, in 2006, almost a quarter of all DOD consultations were in the area of forensic toxicology, which includes examining material from autopsies and testing biological specimens for alcohol and drugs. However, VA physicians most frequently requested AFIP’s environmental toxicology diagnostic consultations, while civilian physicians most frequently requested hepatic consultations—involving diseases of the liver—as well as gastrointestinal consultations.