CHCS is a comprehensive medical information system that Defense has developed to provide automated support to its military medical treatment facilities. As shown in figure 1, the system is multi-faceted and complex, composed of nine integrated modules and shared capabilities, such as order-entry, results retrieval, and electronic mail. The modules are used to create and update the integrated patient database, which can be accessed by all authorized users. We describe the CHCS shared capabilities and modules in more detail in appendix II. CHCS supports high-volume workloads generated by numerous physicians and other health care professionals using the system simultaneously and enhances communications within and among medical treatment facilities. In acquiring CHCS, Defense awarded a contract to Science Applications International Corporation (SAIC), in March 1988, to design, develop, deploy, and maintain CHCS. This contract recently completed its eighth and last year and ended on February 29, 1996. CHCS has become an important part of Defense’s inpatient and outpatient medical operations. From the time a patient is admitted into a medical facility to the time of discharge, CHCS records information on the patient’s condition and treatment and makes it available to physicians, nurses, and technicians. For example, CHCS establishes a medical record as a new patient registers at the facility. As the results of tests that physicians order (as well as other patient information) are entered into CHCS, they become immediately available for medical care decisions. Further, if medication is prescribed, CHCS, in processing the prescription, checks it against the patient’s medical record for potentially dangerous medical interactions. CHCS is also integral to Defense’s implementation of Tricare, its nationwide managed health care program. Defense’s goals for the Tricare program are to improve access to high-quality care while containing the growth of health care costs. Tricare, which is being implemented over a 3-year period, calls for coordinating and managing care on a regional basis using all available military hospitals and clinics supplemented by contracted civilian services. The Managed Care Program submodule of CHCS is the application through which active duty members and beneficiaries choosing the health maintenance organization option will be enrolled in Tricare. Tricare managers will use CHCS to assign enrolled beneficiaries to primary care providers from either the military medical treatment facility or the civilian provider network. CHCS will also assist Tricare managers in maintaining the provider network and scheduling appointments with military and/or civilian network primary care providers and specialists. Finally, CHCS is critical to measuring Tricare’s success because it enables managers to track enrollment and disenrollment in Tricare. To assess Defense’s actions relating to CHCS deployment and operations, we met with program officials at the Office of the Assistant Secretary of Defense for Health Affairs and CHCS program officials at Defense, as well as contractor officials at the following eight medical treatment facilities: Walter Reed Army Medical Center, Washington, D.C.; National Naval Medical Center Bethesda, Maryland; 89th Medical Group, Andrews Air Force Base (AFB), Maryland; 20th Medical Group, Shaw AFB, South Carolina; Moncrief Army Community Hospital, Ft. Jackson, South Carolina; Naval Medical Center Portsmouth, Virginia; 1st Medical Group, Langley AFB, Virginia; and McDonald Army Community Hospital, Ft. Eustis, Virginia. We also contacted CHCS program officials by telephone and mail at the following nine CHCS medical treatment facilities: Naval Hospital Great Lakes, Illinois; Darnall Army Community Hospital, Ft. Hood, Texas; Tripler Army Medical Center, Honolulu, Hawaii; Eisenhower Army Medical Center, Ft. Gordon, Georgia; Blanchfield Army Community Hospital, Ft. Campbell, Kentucky; 59th Medical Wing, Lackland AFB, Texas; 96th Medical Group, Eglin AFB, Florida; 81st Medical Group, Keesler AFB, Mississippi; and 82nd Medical Group, Sheppard AFB, Texas. To assess Defense’s continuing efforts to address past problems, we examined (1) Defense’s August 1994 Performance Management Plan Version 5.0, (2) Defense’s August 1993 deployment plan, Implementation and Use of the CHCS, (3) Defense deployment schedules through October 4, 1995, (4) monthly progress reports provided to Defense by the CHCS contractor through December 1995, (5) Defense’s May 1995 report on VAX/PC system sizing algorithms, (6) Defense’s June 1995 report on high-end system sizing algorithms, and (7) Defense’s July 1995 report on the high-end computing platform for CHCS. We met with CHCS users to ascertain their use of and satisfaction with CHCS, and to observe CHCS in operation. In addition, we reviewed Defense documentation relating to the results of CHCS operational tests. We also received formal briefings from Defense on projects and programs related to CHCS, such as Defense’s Clinical Integrated Workstation project, Defense’s managed health care program, CHCS’ Benefits Realization Improvement Program, and Defense’s Pacific Medical Network project. We worked closely with and briefed senior CHCS program officials at Defense to discuss our concerns as they arose and to confirm our understanding of potential problems and their implications for the achievement of CHCS objectives. We requested written comments from the Secretary of Defense. They were provided by the Assistant Secretary of Defense for Health Affairs and are incorporated as appendix I. At the end of 1995, Defense completed deployment of CHCS to 526 of its 815 medical treatment facilities worldwide. CHCS deployment involved the installation of computer equipment and software to carry out CHCS outpatient and inpatient functions. Given the complexity of the design and development of CHCS and the number of facilities involved, this was not an easy task. Key to the successful development and deployment of CHCS has been the leadership provided by the Deputy Assistant Secretary of Defense for Health Services Operations and Readiness and the CHCS program manager and their application of a set of fundamental information management practices that we refer to as best practices. With worldwide deployment, Defense can realize the full benefits of CHCS, such as the time savings associated with physicians having immediate and facility-wide access to patient information. Instrumental to the successful development and deployment of CHCS worldwide has been Defense’s application of some of the best practices of leading private and public organizations for strategic information management. For example, it has been shown that the involvement and commitment of line management are crucial to making information management decisions and implementing projects. Over the past 5 years, the Deputy Assistant Secretary of Defense for Health Services Operations and Readiness, as the chief executive for the CHCS project, obtained such line management involvement and commitment by (1) promoting tri-service (Army, Navy, and Air Force) representation within Defense’s CHCS Program Office, and (2) engaging the support of the military department surgeon general organizations, which oversee Defense’s medical treatment facilities. The Deputy Assistant Secretary also appointed an experienced and knowledgeable CHCS program manager, who was instrumental in (1) sustaining program momentum, (2) ensuring that CHCS was developed and tested in increments, thereby mitigating the impact of large-scale software development problems, and (3) instituting a set of performance measures relating to hospital operations and medical outcomes to help guide overall program direction. Successful organizations also manage information systems as investments rather than expenses. Two key attributes are: (1) linking information system decisions tightly to program budget decisions and focusing them on mission improvement, and (2) using a disciplined process of postimplementation reviews—based on explicit decision criteria and quantifiable measures assessing mission benefits, risk, and cost—to select, control, and evaluate information systems projects. Defense has issued policies implementing the above two attributes. Also, the CHCS program has consistently followed these policies, which require the continuous involvement of senior Defense program, financial, and information resources management officials. For example, in order to proceed into the various system development phases (analysis, design, programming, testing, validation, and implementation), the CHCS program manager had to submit justification to and obtain approval from Defense’s Major Automated Information Systems Review Council. This justification, which included documentation, such as a functional economic analysis,served as (1) a record of system approval by senior Defense officials and (2) input to Defense’s planning, programming, and budgeting process. Finally, successful organizations have competent line and information management professionals, and ensure that their skills and knowledge are kept current. For example, both the CHCS program and deputy program managers were required to complete the comprehensive, advanced program management training offered by the Defense Systems Management College (DSMC). They also must remain current in their clinical areas by satisfying necessary continuing professional education requirements. Defense currently projects total benefits of $4.1 billion to be derived from using CHCS. This amount exceeds Defense’s $2.8 billion estimated system life-cycle cost by $1.3 billion. Of the total benefits amount, 83 percent represents savings attributed to increased productivity and direct cost offsets. Productivity increases would come from improved scheduling and improved access to patient information. For example, under Defense’s prior paper-based systems, physicians would order tests on paper and the results would be maintained in a patient’s paper medical file. Physicians and other health-care providers would then have to search for either the medical file or some item that was expected to be in the file. With CHCS, this information is now entered directly into the computer and is available to every authorized system user. Health-care providers can review the test results as soon as they are entered into the computer, without having to search through paper documents, thus saving staff time. Similarly, the patient saves time, as fewer visits are unproductive due to missing information. Direct offsets include dollar savings derived from not operating the paper-based systems used prior to CHCS and from expected decreases in malpractice claims.