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“Medically Ready Force…Ready Medical Force”
Defense Health Agency Update
Lt Gen Doug Robb, USAF, MC
Director
April 2015
“Medically Ready Force…Ready Medical Force”
MHS Governance Reform:What We Are Undertaking
• Creating a more globally integrated health system – built on our battlefield successes
• Driving enterprise-wide shared services; standardized clinical and business processes that produce better health and better health care
• Implementing future-oriented strategies to create a better, stronger, more relevant medical force
“Medically Ready Force…Ready Medical Force”
DHA: How We Got Here
DoD Task Force on MHS Governance
September 2011
Recommended DHA model for MHS
governance
DEPSECDEF Planning Memo
March 2012
Directed planning for DHA implementation
DEPSECDEF “Nine Commandments” Memo
March 2013
Directed implementation of DHA
DHA PlanningWG Report
November 2012
Provided DHA and Shared Services
implementation plan for DEPSECDEF approval
“Medically Ready Force…Ready Medical Force” 3
“Medically Ready Force…Ready Medical Force”
DepSecDef Nine Commandments
1. Defense Health Agency (DHA)
a. Designated as a Combat Support Agency
b. Assumes responsibility for the functions currently undertaken by TMA
c. Assumes responsibility for shared services, functions, and activities in the MHS
2.Multi-Service Markets
a. Appoint a Market Manager in geographic medical markets determined by overlapping multi-service catchment areas
b. Market Manager’s mission: create & sustain a cost-effective, coordinated, and high-quality market health care system
c. Market Manager’s authorities: manage & allocate MSM budget, direct adoption of common MSM clinical & business
functions, and direct movement of workload & workforce as needed between/among MSM MTFs
3.National Capital Region Medical Directorate, DHA
a. Assumes authority, direction, and control over the NCR health system, to include Walter Reed National Military Medical
Center, Fort Belvoir Community Hospital, and all other MTFs that are determined to reside within the NCR market
b. Directors of the WRNMMC, the FBCH, and the other MTFs will be selected by the USD(P&R) (or, if delegated, the
ASD(HA), Director, DHA, or Director, NCR Med Dir) from nominees provided by the Military Departments
c. Military personnel for the WRNMMC, the FBCH, and the other MTFs will be provided by the Military Departments according
to manning documents maintained by the DHA
4
MTFs
ArmyOperational
Units
NavyOperational
Units
ArmyMEDCOM
MTFs MTFs
MarineOperational
Units
Air ForceMAJCOMs
Air ForceOperational
Units
CNO CMC
NavyBUMED
CJCS
Secretary of Defense
Sec Army Sec NavySec
Air Force
CSAFCSA
MHSERUSD(P&R),
Vice Chiefs
ASD(HA)
SGs, JSS
MDAG
MPOG MOG MBOG
PDASD,
Deputy
SGs,
JSS,
DD, DHA
Personnel Operations Budget
MDAG,
DASDs,
JSSPAC
SMMAC
USD(P&R)
ASD(HA)
Defense Health Agency
NCR Directorate
MTFs
USUHS
Combat Support
Agency
Responsibilities
Policy & Oversight
ExecutionArmy
SGNavy
SGAir Force
SG
5
Military Health System
Defense Health AgencyMHS Governance Service Medical Organization
Defense Health AgencyLeadership Team
6
Lt Gen Douglas Robb
Director
Mr. Paul Hutter
Deputy Director
CMDCM Terry Prince
Senior Enlisted Advisor
MG Richard Thomas
Director
Healthcare Operations
RADM Bruce Doll
Director
Research & Development
Brig Gen Robert Miller
Director
Education & Training
RADM Raquel Bono
Director
NCR Medical
Mr. David Bowen
Director
Health IT
Mr. Joseph Marshall
Director
Business Support
“Medically Ready Force…Ready Medical Force”
“Medically Ready Force…Ready Medical Force”
DHA as a Combat Support AgencyTranslation: DHA is to medical as DLA is to logisticsas DISA is to communications
8
“Medically Ready Force…Ready Medical Force”
Military Health System Strategic Plan
“Medically Ready Force…Ready Medical Force” 9
- 12 -
MILITARY HEALTH SYSTEM
STRATEGY MAP
WA
YS
EN
DS
ME
AN
S
Healthy
People
Medically
Ready Force
Ready
Medical Force
10
- 13 -
MILITARY HEALTH SYSTEM
STRATEGY MAP
WA
YS
EN
DS
ME
AN
S
Improve
Stewardship
Medically
Ready Force
Ready
Medical Force
Improve Clinical
Outcomes and
Consistent
Patient
Experience
11
Healthy
People
- 14 -
MILITARY HEALTH SYSTEM
STRATEGY MAP
WA
YS
EN
DS
ME
AN
S
Improve
Stewardship
Healthy
People
Medically
Ready Force
Ready
Medical Force
Improve Clinical
Outcomes and
Consistent Patient
Experience
12
- 15 -
MILITARY HEALTH SYSTEM
STRATEGY MAP
WA
YS
EN
DS
ME
AN
S
PLS5
Improve
Stewardship
PLS3
Healthy
People
PLS1
Medically
Ready Force PLS2
Ready
Medical Force
PLS4
Improve Clinical
Outcomes and
Consistent Patient
Experience
13
Align Resources Against Strategic
Priorities \
- 16 -
MILITARY HEALTH SYSTEM
STRATEGY MAP
WA
YS
EN
DS
ME
AN
S
Improve
Stewardship
Healthy
People
Medically
Ready Force
Ready
Medical Force
Improve Clinical
Outcomes and
Consistent Patient
Experience
14Align Resources Against Strategic Priorities
and Ensure Fiscal Accountability
Recruit, Train, & Develop
the Total Force to Meet
Future Challenges
Improve
Information
Infrastructure
OC4
Improve Process-
Based
Management
OC5
Align Facilities, Personnel,
and Capabilities to Optimize
Market Performance
Optimize DHA as
a Support
Organization
- 17 -
MILITARY HEALTH SYSTEM
STRATEGY MAP
WA
YS
EN
DS
ME
AN
S
Improve
Stewardship
Healthy
People
Medically
Ready Force
Ready
Medical Force
Improve Clinical
Outcomes and
Consistent Patient
Experience
15Align Resources Against Strategic Priorities
and Ensure Fiscal Accountability
Recruit, Train, & Develop
the Total Force to Meet
Future Challenges
Improve
Information
Infrastructure
Improve Process-
Based
Management
Align Facilities, Personnel,
and Capabilities to Optimize
Market Performance
Optimize DHA as
a Support
Organization
- 18 -
MILITARY HEALTH SYSTEM
STRATEGY MAP
WA
YS
EN
DS
ME
AN
S
PLS5
Improve
Stewardship
IP4
Enhance
Strategic
Partnerships
IP8
Improve Comprehensive Primary CareIP3
Enhance Emerging
Medical Capabilities
in a Joint
Environment
IP11
Reform TRICARE
F1
Align Resources Against Strategic Priorities
and Ensure Fiscal Accountability
PLS3
Healthy
People
PLS1
Medically
Ready Force PLS2
Ready
Medical Force
IP12
Align Incentives to Achieve Outcomes
IP9
Improve SafetyIP6
Expand the
Boundaries of
Healthcare
OC5
Align Facilities, Personnel,
and Capabilities to Optimize
Market Performance
IP10
Optimize & Standardize Access & Other
Care Support Processes
OC1
Recruit, Train, & Develop
the Total Force to Meet
Future Challenges
OC3
Optimize DHA as
a Support
Organization
OC2
Improve
Information
Infrastructure
OC4
Improve Process-
Based
Management
PLS4
Improve Clinical
Outcomes and
Consistent Patient
Experience
Fin
an
cia
lO
rgan
izati
on
al
Cap
ab
ilit
y
IP5
Improve
Healthy
Behaviors
IP7
Improve Condition-Based Quality Care
IP2
Improve
Operational
Medicine
IP1
Improve
Global Health
Engagement
16
WA
YS
EN
DS
ME
AN
S
(En
ab
lers
)
PLS5
Improve
Stewardship
IP4
Enhance
Strategic
Partnerships
IP8
Improve Comprehensive Primary Care
IP3
Enhance
Emerging Medical
Capabilities in a
Joint Environment
IP7
Improve Condition-Based Quality Care
IP11
Reform TRICARE
IP2
Improve
Operational
Medicine
F1
Align Resources Against Strategic
Priorities and Ensure Fiscal
Accountability
PLS3
Healthy
People
PLS1Medically
Ready Force
PLS2Ready
Medical Force
IP12
Align Incentives to Achieve Outcomes
IP9
Improve
Safety
IP1
Improve
Global Health
Engagement
IP6
Expand the
Boundaries of
Healthcare
OC5
Align Facilities,
Personnel, and
Capabilities to Optimize
Market Performance
IP5
Improve
Healthy
Behaviors
IP10
Optimize & Standardize Access &
Other Care Support Processes
OC1
Recruit, Train, &
Develop the Total
Force to Meet Future
Challenges
OC3
Optimize DHA
as a Support
Organization
OC2
Improve
Information
Infrastructure
OC4
Improve
Process-Based
Management
PLS4Improve Clinical Outcomes and
Consistent Patient Experience
Fin
an
cia
lIn
tern
alP
rocess
Org
an
izati
on
al
Cap
ab
ilit
y
Pati
en
t/L
ead
er/
Sta
keh
old
er
Business Support
Education & Training
Healthcare Operations
Health Information Technology
Research & Development
National Capital Region
DHA
Directorates
Contracting
Human Resources
Manpower
Defense Healthcare
Management System
Special Staff and DHMS
Medical force ready to deliver
health services anywhere, anytime,
so that the total force is medically
ready for, and protected during,
any operational mission
Better Health Better Care Lower Cost
Improve the health of our
population by fostering healthy
lifestyles, preventing illness,
and reducing the impact of
sickness and injury
Provide safe and effective
patient centered healthcare
that improves clinical
outcomes
Reducing the total cost of
the MHS by continuously
improving efficiency and
eliminating waste
1. DHA is strongly aligned to the MHS Strategy Map
2. DHA is foundation that supports the MHS as an integrated system
10
“Medically Ready Force…Ready Medical Force”
DHA Shared Services
20
COL Guy Kiyokawa
Chief of Staff, DHA
“Medically Ready Force…Ready Medical Force”
Shared Services SavingsFive Year Defense Plan (2015-2019)
Shared Service IOC FY15-19 Savings
FACILITIES 1 OCT 13 $537 M
MEDICAL LOGISTICS 1 OCT 13 $189 M
HEALTH IT 1 OCT 13 $265 M
HEALTH PLAN 1 OCT 13 $456 M
PHARMACY 1 OCT 13 $1,224 M
CONTRACTING 1 MAR 14 $136 M
BUDGET & RESOURCE MGMT 1 FEB 14 $279 M
MEDICAL RESEARCH & DEV 1 JUN 14 $98 M
MEDICAL EDUCATION & TNG 10 AUG 14 $ 5 M
PUBLIC HEALTH 1 OCT 14 $293 M
TOTAL $3.482 BILLION
22
“Medically Ready Force…Ready Medical Force”
FY 2014 Shared Service Savings:Covered DHA Initial Investment
The DHA has achieved cost savings and paid for initial investments in FY 2014,
resulting in net savings of approximately $236 million.
23
“Medically Ready Force…Ready Medical Force”
Shared Services FOC CriteriaDeveloped through MHS Gov (Future Shared Services Team)
Criteria Met
1.
The military Services agree they are receiving the services as agreed in the Coordinated Concept of
Operations (CCONOPS). The Shared Service has a mechanism (working group, committee, etc.) to
elicit feedback from Services and to communicate with the Services.
2.For product line or initiative (one entry for each) as agreed to in the (CCONOPS), the Shared Service
has work underway and is actively managing actions associated with this product line or initiative.
3.The Shared Service has received the resources identified in the CCONOPS, or resources have been
sufficiently programmed to carry out the operation of this Shared Service
4.The Shared Service developed performance metrics to help manage actions, report progress,
identify gaps, and identify areas for improvement
5. There is no substantive change required to the CCONOPS of the Shared Service
6. The Shared Service has a vision and mission statement
24
“Medically Ready Force…Ready Medical Force”
DHA 2nd Year Focus Areas
• Achieve DHA FOC NLT 1 OCT 2015
• Transition 10 Shared Services from IOC to FOC
• Assess the “11th Shared Service” and beyond
• Centers of Excellence and Executive Agents
• Sustain/Monitor efforts to achieve FY15-19 savings of $3.482B
• Develop & Sustain an MHS Performance Management System to drive
MHS system-wide continuous improvement – improving quality and safety
where needed
• Enable DoD’s Electronic Health Record Modernization
• Institute the Next Generation TRICARE Health Plan (T-2017)
• Institute an integrated DHA Acquisition Structure
• Conduct DHA Manpower Assessments to properly align resources
• Introduce a common cost accounting structure
25
Facilities
Mr. John A. Becker
Director, Facilities Division
26“Medically Ready Force...Ready Medical Force”
“Medically Ready Force…Ready Medical Force”
Facilities Shared ServiceFull Operating Capability (FOC)
Status: FOC effective 3 March 2015 Governance Model: Collaborative enterprise management in coordination with
Services providing integrated world-class Health Facility Life Cycle Management (FLCM) for the Military Health System
MHS Governance Structure: Health Facilities Coordinating Council (HFCC) and Medical Business Operations Group (MBOG)
BLUF: In close collaboration with the Services and Design/Construction Agents, DHA Facilities is improving FLCM through standardization, improved processes, and implementation of a Company Operating Model (CONOPS)
Highlights: (1) Standardized demand signal and prioritization process for MilCon requirements (2) Standardized Sustainment, Restoration, and Modernization programming models (SRM) (3) Standardized IO&T programming model (4) DHA Facilities support to e-MSMs for future capital requirements
Challenges: (1) Reacting to and accommodating impact of external forces on long lead time MilCon planning, programming, and budgeting. (e.g. Force Structure changes, mission changes. etc.) (2) Modernization and replacement of an aging inventory
“Medically Ready Force…Ready Medical Force” 27
“Medically Ready Force…Ready Medical Force”
Facilities Shared ServiceBCA and Performance Measures
28
Area / Type MeasureReporting
FrequencyNotes on Current Status
Current StatusExpected
Completion
Date
Cost / BCASavings achieved vs. savings
projectedAnnually
Re-baseline savings to PB15 funding levels and
revalidation of costs in progressFY14 Q2
Quality / BCA
Facility Condition Index (3 Year Implementation) Quarterly
Measures levels of requirements in DMLSS-FM relative
to facility replacement value; “Builder” implementation
complete in FY17
FY14 Q2
Quality / BCA Facility Functionality Index Quarterly
“Builder” system implementation reflects facility
functionality related to accreditation (safety, req’d
spaces, adjacencies)
FY15 Q3
Quality / BCA Asset Productivity Index QuarterlyExpanding portfolio management to include productivity
data linked to facilitiesFY15 Q3
Cost / Perf
Measure
% of projects performed within cost & schedule
MonthlyProgram oversight data and targets established by &
reviewed monthly with Agents & ServicesFY14 Q3
Quality / BCACustomer Satisfaction Survey with
facility environment of careQuarterly
TRISS Reports reflect patient experience of cleanliness
and quietness of hospital environFY15 Q1
Reporting data
against targetsUnder
development
Developed, but no
baseline
Baseline and
targets exist
Baseline exists,
but no target
“Medically Ready Force…Ready Medical Force”
Facilities Shared Service BCA Costs and Projected Savings
29
Data Reviewed by the
MBOG: 25 Feb 15FY14-19 Projected Net Savings with FY14 Actuals
Actual: $(4.63)
FY14 - $311M IO&T Savings for MHS Redistribution
*FY13 YE bought ahead $40M in
Implementation Costs
Medical Logistics
30
CAPT Bernie Poindexter
Director, Logistics Division
“Medically Ready Force...Ready Medical Force”
“Medically Ready Force…Ready Medical Force”
Medical Logistics (MEDLOG) Shared Service
Status: FOC effective 3 March 2015
Governance Model: Corporate management and compliance oversight of joint MEDLOG initiatives related to medical supply, equipment, and services
MHS Governance Structure: Defense Medical Logistics Proponent Committee (DMLPC) and Medical Business Operations Group (MBOG)
BLUF: In close collaboration/coordination with the Services and DLA, DHA MEDLOG is taking ‘cost out’ of the medical supply chain by eliminating waste (price, excess inventory, and process) and reducing unwarranted variation through strategic sourcing and standardization
Highlights: (1) Improved ordering compliance for 1,415 standardized products (2) growing e-commerce solutions for provider preference items at significant discounts (3) Healthcare Technology Joint Requirements Assessments (JRA) for the eMSMs (NCR planned for May 15) and (4) MEDLOG Support for NCR-MD
Challenge: Medical Device (60,000+ across MHS) compatibility (interoperability and integration) with the EHR
“Medically Ready Force…Ready Medical Force” 31
“Medically Ready Force…Ready Medical Force”
MEDLOG Shared ServiceBCA and Performance Measures
32
Area / Type MeasureReporting
FrequencyNotes on Current Status
Current StatusExpected
Completion
Date
Cost Gross Savings Quarterly
As of 31 Jan 2015:
FY 14: Actual gross savings = $24.32M
FY 15 Q1: Projected gross savings = $7.21M
Completed
Cost
Use of Incentive Agreements (Formerly % of
Procurement of Standardized Products) Quarterly
Quarter 1 Quarter 2 Quarter 3 Quarter 4
CompletedFY 14: 77.2% 79.4% 80.8% 81.2%
FY 15: 83.9% - - -
Cost Use of eCommerce Quarterly
Quarter 1 Quarter 2 Quarter 3 Quarter 4
FY 14: 68% 67% 67% 70%
FY 15: 72% - - -
Cost Total Joint Requirements Assessment Cost Savings Annually Reported Annually – Metrics Available Q2 FY15 Pending
Cost Total Cost Savings from Equipment Group Purchases AnnuallyFY 14 Army Air Force Navy NCR MD
Completed$5.15M $3.18M $.79M $1.06M $0.096M
Cost DoD Service Contracts Annually Reported Annually – Metrics Available Q2 FY15 Pending
Cost Maintenance Contract Costs to Acquisition Cost Ratio Annually Reported Annually – Metrics Available Q2 FY15 Pending
Quality Average Age of Equipment in DoD Inventory Annually Reported Annually – Metrics Available Q2 FY15 Pending
Reporting data
against targets
Under
development
Developed, but no
baseline
Baseline and
targets exist
Baseline exists,
but no target
“Medically Ready Force…Ready Medical Force”
BCA Category FY14FY14
RealizedFY15 FY16 FY17 FY18 FY19 Total
Primary Drivers of Implementation
Costs
Supplies
Savings ($M) 19.13 19.17 26.29 33.12 36.29 43.61 50.55 208.99 • IT investment (RDT&E)
Cost ($M) 5.27 3.64 4.00 1.86 - - - 11.13
Net Savings ($M) 13.86 15.53 22.29 31.26 36.29 43.61 50.55 197.86
Health Care
Technology
Savings ($M) 0.00 5.15 4.47 11.77 16.51 17.75 18.09 68.59 • IT investment (RDT&E)
• Contractor support (O&M)
• TDY Funding (O&M)Cost ($M) 0.41 0.76 1.55 1.11 0.92 0.95 0.93 5.87
Net Savings ($M) -0.41 4.39 2.92 10.66 15.60 16.80 17.15 62.72
Services
Savings ($M) 0.00 0.00 0.38 0.77 1.18 1.59 2.04 5.96
Cost ($M) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Net Savings ($M) 0.00 0.00 0.38 0.77 1.18 1.59 2.04 5.96
GRAND TOTAL
NET SAVINGS
Annual ($M) 13.45 19.92 25.59 42.69 53.07 62.01 69.73 266.54
Cumulative ($M) 13.45 19.92 39.04 81.73 134.80 196.81 266.54
RTC Savings
Projections
Annual ($M) -5.68 19.92 7.05 24.96 41.73 52.51 62.78 183.34
Cumulative ($M) -5.68 19.92 1.37 26.33 68.06 120.57 183.35
MEDLOG Shared ServiceFY 14 Savings vs POM 15-19 Submission
33
Actual FY 14 Annual Net Savings
33
$19.92
*Additional savings through cost avoidance are to be reinvested within the Shared Service
Pharmacy
Dr. George E. Jones, Jr.
Chief, Pharmacy Operations Division
34“Medically Ready Force...Ready Medical Force”
Status: FOC effective 3 March 2015
Governance Model: Corporate management and compliance oversight of Pharmacy initiatives related to all aspects of pharmacy benefit delivery
MHS Governance Structure: Pharmacy Work Group (PWG) and Medical Operations Group (MOG)
BLUF: A collaborative effort with the Services to reduce unwarranted variation through deliberate planning and consistent messaging and measurement of pharmacy delivery
Highlights: (1) Implemented three successful initiatives in FY14 - $215M savings (2) Enhanced communication with quarterly world-wide pharmacy webinars (3) Fully deployed MTF capability to accept electronic prescriptions from community providers (4) Developed and implemented with the Services a uniform process for prescription transfers (5) Supporting pharmacy within and across eMSMs
Challenge: Managing impact of external forces on program execution (e.g. New Drugs; Trends in therapy – compounding; Drug shortages)
“Medically Ready Force…Ready Medical Force” 35
Pharmacy Shared Service
Full Operating Capability (FOC)
The MHS Spent $8.06B on pharmacy related expenditures in FY14; however, we would have spent $8.28B if not for specific initiatives undertaken by DHA Pharmacy
36 36
Why have pharmacy costs increased despite pharmacy’s cost saving initiatives?
Without pharmacy’s cost saving initiatives, the enterprise would have spent an additional $215M in FY14
Channel Management (TFL Pilot)
Saved $74.8M
Formulary Management
Saved $100.3M
Compliance to Purchasing Rules
Saved $39.9M
We spent:
$8.06B
Instead of:
$8.28B
Specialty Drugs
Cost ~$121M1
Compounds
Cost ~$512M3
• This issue is not unique to the MHS; spending on specialty drugs increased by 14.1% and 14.7% in the
commercial health industry and Medicare respectively in 20132
• Compound spending has increased throughout the industry; Express Scripts International, the largest
pharmacy benefits manager, reported that its quarterly spending on compounds increased over 500% from
2012 to 2014 (from $28M to $171M per quarter) 4
“Medically Ready Force…Ready Medical Force”
“ Medically Ready Force…Ready Medical Force”
Pharmacy Shared ServiceBCA and Performance Measures
37
Reporting data
against targets
Under
development
Developed, but no
baseline
Baseline and
targets exist
Baseline exists,
but no target
# Area / Type MeasureReporting
FrequencyNotes on Current Status Current Status
Expected
Completion
Date
1 Cost
Maintenance medication refills filled at all
points of service with the ability to drill down
to the Enhanced Multiservice Market Level
(eMSM) and by distribution of enrollment
status
Quarterly - Complete
2 Cost
MTF, retail, and mail order market share
overall with the ability to drill down to the
eMSM level and by distribution of enrollment
status
Quarterly - Complete
3 CostThe percent of pharmacy spend directed to
the retail point of serviceQuarterly - Complete
4 Cost
Net pharmacy cost to government per
member per month (PMPM) at the eMSM
levelQuarterly - Complete
5 Cost
Percentage of drugs purchased as generic
when generic is identified as a preferred
agent, per MTF outpatient pharmacyMonthly - Complete
6 Cost
Percentage of compliance with purchasing
drugs via national contracts, per MTF
outpatient pharmacyMonthly - Complete
Pharmacy Shared ServiceFY 14 – 15 Savings vs POM 15-19 Submission
38“Medically Ready Force…Ready Medical Force” 38
BCA Category FY14FY14
RealizedFY15 FY16 FY17 FY18 FY19 Total
Primary Drivers of
Implementation Costs
#1: Phase I:
Eliminate Retail
Refills
Savings ($M) $625.05 $74.8 $812.56 $826.38 $842.08 $859.76 $878.68 $4,844.51 • New drug costs at Home Delivery
and MTF outpatient pharmaciesCost ($M) $532.05 $0.00 $691.65 $703.41 $716.78 $731.83 $747.93 $4,123.64
Net Savings ($M) $93.00 $74.8 $120.91 $122.97 $125.30 $127.93 $130.75 $720.86
#2: Phase II:
Eliminate Retail
Refills, Optimize
MTF Capacity
Savings ($M) $0.00 $0.00 $0.00 $13.19 $26.88 $41.18 $56.11 $137.36 • New drug costs at Home Delivery
and MTF outpatient pharmaciesCost ($M) $0.00 $0.00 $0.00 $7.39 $15.06 $23.06 $31.43 $76.94
Net Savings ($M) $0.00 $0.00 $0.00 $5.80 $11.82 $18.12 $24.68 $60.42
#3: Enable MTF
compliance to
Pharmacy’s
centralized drug
purchasing rules
Savings ($M) $8.00 $39.9 $16.22 $24.75 $33.63 $42.92 $43.86 $169.38 • Personnel needed to implement
the enabling IT solutionCost ($M) $0.62 $0.00 $0.63 $0.64 $0.65 $0.67 $0.68 $3.90
Net Savings ($M) $7.38 $39.9 $15.59 $24.11 $32.97 $42.25 $43.18 $165.48
Table continues on next slide.
$-
$500
$1,000
$1,500
$2,000
FY14 FY15 FY16 FY17 FY18 FY19
Do
llars
(in
Mill
ion
s)
Risk- and Inflation-Adjusted Projected Savings, FY14-19
Annual ($M)
Cumulative ($M)
Actual FY14 Annual Net Savings
Pharmacy Shared ServiceFY 14 – 15 Savings vs POM 15-19 Submission (cont.)
39 39
BCA Category FY14FY14
RealizedFY15 FY16 FY17 FY18 FY19 Total
Primary Drivers of
Implementation Costs
#4: DoD Pharmacy
& Therapeutics
Committee (P&T
Committee)
formulary
management
Savings ($M) $60.00 $100.3 $60.84 $61.87 $63.05 $64.37 $65.79 $375.93 • To be determined;
implementation costs unknown
at this timeCost ($M) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
Net Savings ($M) $60.00 $100.3 $60.84 $61.87 $63.05 $64.37 $65.79 $375.93
#5: Suspend
coverage of
newly approved
FDA drugs
Savings ($M) $0.00 $0.00 $4.06 $8.25 $8.41 $8.58 $8.77 $38.07 • To be determined; proposed
pharmacy regulation Cost ($M) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
Net Savings ($M) $0.00 $0.00 $4.06 $8.25 $8.41 $8.58 $8.77 $38.07
#6: Centralize
pharmacy
automation
contracts
Savings ($M) $0.10 $0.00 $6.69 $6.81 $6.94 $1.61 $1.64 $23.79 • To be determined;
implementation costs unknown
at this timeCost ($M) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
Net Savings ($M) $0.10 $0.00 $6.69 $6.81 $6.94 $1.61 $1.64 $23.79
#7: Implement a
System of Satellite
MTF Pharmacy
Locations
Savings ($M) $0.00 $0.00 $0.00 $0.03 $0.05 $0.07 $0.11 $0.26 • To be determined;
implementation costs unknown
at this timeCost ($M) $0.00 $0.00 $0.00 $0.09 $0.02 $0.03 $0.05 $0.19
Net Savings ($M) $0.00 $0.00 $0.00 -$0.06 $0.03 $0.04 $0.06 $0.07
GRAND TOTAL
NET SAVINGS
Annual ($M) $160.48 $215.0 $208.09 $229.80 $248.48 $262.87 $274.82 $1,384.54
Cumulative ($M) $160.48 $215.0 $368.57 $598.37 $846.86 $1,109.72 $1,384.54 --
“Medically Ready Force…Ready Medical Force”
Metric #6 – National Contract Compliance
75.1%
86.7%
0%
20%
40%
60%
80%
100%
Sep
-13
Oct
-13
No
v-1
3
Dec
-13
Jan
-14
Feb
-14
Mar
-14
Ap
r-1
4
May
-14
Jun
-14
Jul-
14
Au
g-1
4
Sep
-14
Oct
-14
No
v-1
4
Air Force Army Navy Overall
“Medically Ready Force…Ready Medical Force”
“Medically Ready Force…Ready Medical Force” 42
Outpatient Compound Costs –
Fraud Investigations
Multiple PI investigations ongoing
“Medically Ready Force…Ready Medical Force”
Health Information Technology
43
Mr. David M. Bowen
Director, Health Information Technology
“ Medically Ready Force…Ready Medical Force”
Health Information Technology (HIT)BLUF / Challenges / Wins
BLUF: HIT has an “all-in” approach—unique from other Shared Services. HIT is working towards Full Operating Capability (FOC)—1 Oct 2015
Challenges: (1) Managing cultural change—TMA and Services had distinct processes (2) Standardizing the HIT infrastructure eliminating duplicative applications (3) Disrupting historical HIT funding and approval processes (4) Upgrading IT infrastructure necessary to support the Electronic Health Record (5) Establishing/maintaining the trust of our customers that we’ll do this right!
Wins: (1) Two huge efforts: HIT stand-up and EHR support —we haven’t broken anything! (2) FY14 – exceeded business case by $54 million, FY15 - saved $20M to date (3) Developed and implemented metric reporting system for 90-day review actions (4) Established financial processes; gaining visibility in MTF IT spend/contracts
“Medically Ready Force…Ready Medical Force” 44
“Medically Ready Force…Ready Medical Force”
Area/Type MeasureReporting
FrequencyNotes on Current Status Current Status
Expected
Completion
Date
BCA Savings Shared Services Savings Achieved MonthlyPreviously reported savings achieved in FY14 was $39.19M and has
been revised to $29.50M to reflect execution emerging requirements
Currently
Reporting
Cost
Total IT costs as a percentage of MHS budget Annually
DHP including EHR and excluding purchased care.
FY14 Budget-based Baseline=11%. Future Years Target = 15%.
Actual Execution FY14 = 11 %
Currently
Reporting
Percentage of IT spending allocated to
delivering new capabilitiesAnnually
FY14 Budget-based Baseline= 14%. Future Years Target = 29%.
Actual Execution FY14 = 14 %
Currently
Reporting
Speed Percentage of software products deployed on
time Quarterly
Quarterly reporting based on Annual Performance Plan (APP)
deployment data. Target set at 82% for FY15. Actual deployment
percentage for FY15 Q1 was 83%.
Currently
Reporting
Quality Percentage of systems meeting system
availability standardsQuarterly
Quarterly reporting based on APP system availability standards and
data, Target set at 90%. Actual percentage of systems that met
their availability targets for FY15 Q1 was 80%.
Currently
Reporting
Strategic
AlignmentAlignment of IT with MHS strategic objectives Annually
Preliminary alignment to draft MHS objectives completed.
Dependency: Final published MHS objectives
Ongoing
refinement
Customer
Service
Executive Satisfaction with overall HIT
Directorate performanceQuarterly
Third Executive Satisfaction Survey Q4 Survey was completed in
January 2015 due to scheduling delays
Currently
Reporting
Health Information Technology
Key Measures
Reporting data
against targets
Under
development
Developed, but no
baseline
Baseline and
targets exist
Baseline exists,
but no target
45
“Medically Ready Force…Ready Medical Force”
Funding will need to be provided each year in order to produce net savings in FY16, and reach annual steady-state net savings in FY19.
BCA Category FY14FY14
RealizedFY15
FY15
Realized FY16 FY17 FY18 FY19 TotalPrimary Drivers of Implementation
Costs
#1: Reengineering
of IT Management
Savings ($M) $3.31 $3.80 $5.67 $0.00 $5.77 $5.88 $6.00 $6.13 $32.76 • IT costs to invest in tools (portfolio
management, EA) needed to support and
automate reengineered business
processes.
Cost ($M) $4.37 $0.00 $2.58 $0.00 $2.10 $2.14 $2.18 $0.00 $13.37
Net Savings ($M) ($1.07) $3.80 $3.09 $0.00 $3.67 $3.74 $3.82 $6.13 $19.38
#2: Infrastructure
Consolidation
Savings ($M) $3.05 $18.76 $6.19 $0.00 $14.68 $16.56 $16.91 $74.71 $132.10 • Contract support for transition planning
and PMO (e.g., product line analysis,
scheduling, risk management).
• IT costs for product line consolidation
(e.g., additional servers, storage,
bandwidth).
Cost ($M) $0.00 $13.78 $17.53 $0.00 $13.63 $28.85 $31.64 $0.00 $91.65
Net Savings ($M) $3.05 $4.98 ($11.34) $0.00 $1.05 ($12.29) ($14.73) $74.71 $40.45
#3: Portfolio
Rationalization
Savings ($M) $0.00 $20.72 $21.33 $0.00 $40.24 $66.21 $67.60 $69.08 $264.46 • IT costs for decommissioning and
promotion of system to enterprise level
(e.g., migrating/archiving data, increasing
capacity of target system, hardware
disposal, training, change management,
BPR).
Cost ($M) $23.98 $0.00 $24.32 $0.00 $32.97 $0.00 $0.00 $0.00 $81.27
Net Savings ($M) ($23.98) $20.72 ($2.99) $0.00 $7.27 $66.21 $67.60 $69.08 $183.19
GRAND TOTAL
NET SAVINGS
Annual ($M) ($22.00) $29.50 ($17.38) $0.00 $11.12 $56.48 $55.86 $148.75 $232.83
Cumulative ($M) ($22.00) $29.50 ($39.38) $0.00 ($28.26) $28.22 $84.08 $232.83 --
Steady state
Break-even
Health Information Technology
FY14 Savings vs FY15-19
Projected Savings
46
Adjusted FY16-20
Actual FY14-15 Annual
Net Savings
TRICARE Health Plan
47
CAPT Edward Simmer
Deputy Chief, TRICARE Health Plans
“Medically Ready Force...Ready Medical Force”
TRICARE Health Plans Shared ServicesBLUF / Challenges / Wins
BLUF: (1) Goal: To fully integrate purchased care and direct care systems On schedule to achieve FOC 1 Aug 2015
Challenges: (1)Sole source contract extension in North limits ability to negotiate changes(2) Statutory/regulatory limitations on innovation
Wins: (1) Integrated Services into T-2017 and T-20xx development, making them full partners in this process(2) TRICARE Service Center closure completed with no negative impact on customer satisfaction(3) Other Health Insurance centralized initiative about to launch(4) Established mission essential metrics focused on access, safety, readiness
48
“Medically Ready Force…Ready Medical Force”
Health Plan
Progress Update
Milestone Indicator SuspenseRevised
SuspenseCompleted
Tra
ns
itio
n
Complete organization review of functions with Office
of Strategy Management 15 Jul 14
Develop unit manning document IAW guidelines
(org review started)1 Oct 15
Develop/update position descriptions 1 Oct 15
Inventory contracts and begin identifying opportunities
for rationalization for requirements1 Oct 15
Implement performance plans aligned to organizational
goals
31 Mar 14
Clo
se
TR
ICA
RE
Serv
ice
Cen
ters
(T
SC
)
Develop plan and metrics to monitor closure of the TRICARE Service Centers (TSC)
1 Aug 13 31 Aug 13 30 Jun 14
Provide quality / satisfaction data on TRICARE call centers 1 Aug 13 31 Dec 13 30 Jun 14
Issuance of contract modifications 29 Nov 13 29 Nov 13 22 Nov 13
Conclusion of Contract Negotiations 4 Mar 15 TBD
Enhance Beneficiary Web Enrollment (BWE) functionality 30 Sept 14 31 Mar 15
Overall Status:Complete On Schedule At Risk of Missing Suspense
49
“Medically Ready Force…Ready Medical Force”
Health Plan
Progress Update (Continued)
Milestone Indicator SuspenseRevised
SuspenseCompleted
Oth
er
Healt
hIn
su
ran
ce
(OH
I)
Develop PWS and Market Research 1 Oct 13 11 Mar 14 11 Mar 14
Document and deploy DEERS changes
- New or revised reports
- Technical specifications for
data files
1 Apr 14 27 Mar 14
Modify OHI business processes
- MCSC processes
- Direct Care processes
- Pre-ABACUS
- Post-ABACUS
1 Feb 14 1 Apr 14 27 Mar 14
Award DMDC Task Order Contract and implement OHI
discovery
- Award of task order
- Phase-In activities
1 Apr 14 1 May 14 30 Apr 14
Award DHA Contract and implement OHI discovery
- Award of task order
- Contract protest
- Phase-In activities
15 Sept 14 3rd Qtr FY15
Overall Status:Complete On Schedule At Risk of Missing Suspense
50
“Medically Ready Force…Ready Medical Force”
Health Plan
BCA Costs and Projected Cost Avoidance
*Risk-Adjusted Net Savings
** May be adjusted up for FY15
once OHI collection begins.
As of 4 Mar 2015
BCA Category FY14 FY15 FY16 FY17 FY18 FY19 Total
Primary Drivers
of
Implementation
Costs
#1 TSC:
Savings ($M)0.0 11.0 22.0 22.0 48.8 50.2 154.0
Contract-related
costs
Cost ($M) 5.5 0.0 0.0 0.0 0.0 0.0 5.5
Net Savings ($M)-5.5 11.0 22.0 22.0 48.8 50.2 148.5
#2 OHI:
Savings ($M)0.0 0.0** 46.7 47.6 48.6 49.7 192.6
Contract-related
costs
Cost ($M) 8.1 7.8 2.8 2.5 2.8 2.8 26.8
Net Savings ($M)-8.1 -7.8 43.9 45.1 45.8 46.9 165.8
GRAND TOTAL Annual ($M)-13.6 3.2 65.9 67.1 94.6 97.0 314.3
NET SAVINGS Cumulative ($M)-13.6 -10.4 55.5 122.6 217.3 314.3
314.3
RTC
PROJECTION
Annual ($M)48.0 85.0 88.0 91.0 94.0 97.0 503.0
Cumulative ($M)48.0 133.0 221.0 312.0 406.0 503.0 503.0
+/- FROM RTC
PROJECTION
Annual ($M)-61.6 -81.8 -22.1 -23.9 0.6 0.0 -188.7
Cumulative ($M)-61.6 -143.4 -165.5 -189.4 -188.8 -188.7 -188.7
52
“Medically Ready Force…Ready Medical Force”
Budget & Resource Management
53
Mr. Robert Moss
Budget & Resource Management Division
Budget & Resource ManagementBLUF / Challenges / Wins
BLUF: (1) Automated Third Party Billing and collection capability by 1 July 2015 (2) Standardize medical record coding policies/procedures for all three Military Services by 31 Mar 2015 (3) Initial implementation of common cost accounting structure by 1 Oct 2015
Challenges: (1) Operating billing and collection services as we transition to the DISA directed cloud environment (2) Development of common cost accounting structure with three distinct Military Services’ accounting systems (3) Transitioning to HIPAA-compliant remote medical record coding capability
Wins: Services total cooperation in developing single billing/collection capability and unanimity in medical record coding policies/procedures
54
“Medically Ready Force…Ready Medical Force”
Budget and Resource ManagementProduct Line Progress
Milestone Indicator SuspenseRevised
SuspenseCompleted
Imp
lem
en
tati
on
of
Co
mm
on
Co
st
Ac
co
un
tin
g
Str
uc
ture
Award a contract for implementation support of CCAS Jun 14 - Jun 14
Initial implementation of CCAS with the services Jan 15 May 15 -
Full implementation and operation of CCAS Sep 15 - -
Imp
lem
en
t J
oin
t
Billin
gS
olu
tio
n
(AB
AC
US
)
Award of ABACUS contract Jan 14 - Jan 14
Deployment of ABACUS Outpatient Third Party Collections
(TPC) Module (ATO 5 Mar 15)Jun 14 Jun 15 -
Deployment of ABACUS Inpatient TPC Module (ATO 5 Mar
15)Sep 14 Jun 15 -
Esta
bli
sh
Med
ical C
od
ing
Pro
gra
m O
ffic
e
Establish Coding Working Group with approved charter Oct 14 - Oct 14
Establish draft remote coding CONOPS to coordinate with
HIT/DHSSDec 14 TBD -
Develop single DoDi guidance (Draft) on Medical Services
Documentation, Coding, and ComplianceMar 15 - -
Finalize and implement approved single DoDi guidance Mar 15 Oct 15 -
Develop a DHA Central IDIQ contract Sep 15 TBD -
Complete On Schedule At Risk of Missing Suspense
Requires back-up slide for explanation of risk and way ahead
55
“Medically Ready Force…Ready Medical Force”
BCA Category FY14FY14
RealizedFY15 FY16 FY17 FY18 FY19 Total
Primary Drivers of
Implementation
Costs
Implementation of a
Common Cost
Accounting Structure
Savings ($M) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 • Contract support
Cost ($M) $1.04 $1.04 $0.00 $0.00 $0.00 $0.00 $0.00 $1.04
Net Savings ($M) ($1.04) ($1.04) $0.00 $0.00 $0.00 $0.00 $0.00 ($1.04)
Implementation of a
Joint Billing Solution
(ABACUS)
Reimbursements ($M) $6.02 $0.00 $43.65 $58.84 $59.95 $61.21 $62.56 $292.23 • Contract Support
Cost ($M) 1,2,3 $19.83 $19.83 $15.27 $15.85 $15.64 $14.77 $11.76 $93.12
Net Reimbursements ($M) ($13.81) ($19.83) $28.38 $42.99 $44.31 $46.44 $50.80 $199.11
GRAND TOTAL NET
REIMBURSEMENTS
Annual ($M) ($14.85) ($20.87) $28.38 $42.99 $44.31 $46.44 $50.80 $198.07
Cumulative ($M) ($14.85) ($20.87) $13.53 $56.52 $100.83 $147.27 $198.07 --
Budget and Resource ManagementFY 14 – 15 Reimbursements vs POM 15-19 Submission
56 56
1Initial investment costs at IOC were $6.89M due to procurement sensitivity of ABACUS; Upon award, ABACUS investments costs were $79.265M (O&M funded, Program Mgmt, Information Assurance), as detailed
in the ABACUS Briefing for Lt Gen Robb dated 2 April 2014 2Additional lifecycle costs were $5.47M, as detailed in the DHSS ABACUS IPR Final briefing dated 17 June 2014 3Additional costs to sustain TPOCs due to
ABACUS delays (3 mths FY14 and 12 mths FY15) on 18 Nov 2014
“Medically Ready Force…Ready Medical Force”
Procurement/Contracting
57
Mr. Eric Thaxton
Deputy Director of Acquisition Division for Procurement
ContractingBLUF / Challenges / Wins
BLUF
(1) Contracting shared service strives to generate efficiencies through strategic sourcing of common requirements.
(2) On Schedule to achieve Full Operating Capability 1 Oct 2015
Challenges: Moving toward strategic sourcing while executing non strategic requirements
Wins
(1) Enhanced Operating Model implementation 1 April; includes 101 improvement initiatives in Product Lines 1 and 2
(2) Agency wide contract data call completed; establishes demand signal rationalization process
(3) Cost savings of $12.75M in personnel implementation costs
58
Contracting Shared ServicePerformance Metrics*
59
# Metric DescriptionReporting
Frequency
Current
StatusStatus Notes
Expected
Completion
Date
1Savings attributed to DoD
strategic sourcing strategies
Cost of services/supplies obtained in
baseline minus strategically sourced
services/supplies
Bi-Annual
Savings will not be generated until after
DHA MATOs for Q and R services are
awarded in FY17 and workload migrates
in FY18
Q1 FY19
2
Savings attributed to
developing centralized
strategic sourcing solutions for
Q services^
Savings achieved in key markets
(Colorado Springs, Washington State,
San Antonio) through use of strategic
sourcing solutions for Q services
Bi-Annual
Savings will not be generated until after
DHA MATO for Q services are awarded
in FY17 and workload migrates in FY18
Q1 FY19
3
Savings attributed to utilizing
existing strategic sourcing
solutions for R services
Savings achieved across Services' and
former TMA R services R services
portfolio categorized according to extent
of competition prior to contract award.
Bi-Annual
Savings will not be generated until after
DHA MATO for R services are awarded
in FY17 and workload migrates in FY18
Q1 FY19
4
Savings attributed to "ordering
windows (e.g., IT hardware
purchases)
Savings achieved by specifying
timeframe in which orders can be placed
for certain goods or services
Bi-Annual
D service MATO to be awarded in FY16
will establish quarterly ordering windows
for IT hardware; workload will migrate in
FY17
Q1 FY18
5Savings achieved through
vendor base management
Savings achieved from strategically
managing vendor base to eliminate pass-
throughs and drive down overhead costs
Bi-Annual
D service MATO to be awarded in FY16
will be the first opportunity for managing
the vendor base to generate savings;
workload will migrate in FY17
Q1 FY18
Reporting data against targetsUnder development Developed, but no baseline Baseline and targets exist
*As outlined in CONOPS and Third Report to Congress. The five priority metrics presented here are under developed since IOC as they provide important early indicators of savings realized from Contracting shared services. Efficiencies will be baselined after the establishment of DHA Sourcing Strategies. Other metrics will be developed and tracked after IOC in a phased approach.^Q Services savings metric timeline revised based on resource challenges and Service equities that impacted Service-level strategic MATOs.
“Medically Ready Force...Ready Medical Force”
Contracting Shared ServiceRevised BCA Costs & Projected Savings
Opportunity FY14 FY15 FY16 FY17 FY18 FY19 FY20 Cumulative
Acquisition
Planning and
Program
Management
Develop or identify
strategic MATOs for the
DHA
Initiative 1: 0 0 0 0 2.93 5.98 21.36 30.27
Q Services
Initiative 2:0 0 0 0 9.13 18.62 66.49 94.24
R Services
Annual Savings 0 0 0 0 12.06 24.6 87.85 124.51
Annual Costs 0 -1.93 -1.96 -2.00 -2.03 -2.08 -2.12 -12.12
Annual Net Savings 0 -1.93 -1.96 -2.00 10.03 22.52 85.73 112.39
Execution,
Management,
and
Administration
Initiative 3:0 0 0 2.11 4.25 15.31 0 21.67
Establish "ordering windows"
Initiative 4:0 0 0 3.17 6.4 22.94 0 32.51
Strategically manage vendor base
Annual Savings 0 0 0 5.28 10.65 38.25 0 54.18
Annual Costs 0 0 0 0 0 0 0 0
Annual Net Savings 0 0 0 5.28 10.65 38.25 0 54.18
Enabler:
Legal Support
Initiative 5: Decouple Compensation
ceiling under Title 50 0.05 0 0 0 0 0 0.05
Annual Savings 0 0.05 0 0 0 0 0.05
Annual Costs 0 0 0 0 0 0 0 0
Annual Net Savings 0 0.05 0 0 0 0 0 0.05
Annual New Manpower Costs 0 -0.78 -0.79 -0.80 -0.82 -0.84 -0.85 -4.88
Total Annual Savings 0 0.05 0 5.28 22.71 62.85 87.85 178.74
Total Annual Costs 0 -1.93 -1.96 -2 -2.03 -2.08 -2.12 -12.12
Net Savings 0 -2.66 -2.75 2.48 19.86 59.93 84.88 161.74
61“Medically Ready Force...Ready Medical Force”
0 -$2.66 -$2.75 $2.48 $19.86
$59.93
$84.88
-$1.43 -$1.51$10.92 $21.38
$79.54
-$50
$
$50
$100
Annual Projected Savings, FY14-20, Risk & Inflation Adjusted
Rebaseline Annual Savings ($M) Original BCA Annual Savings ($M)
0 -$2.66 -$5.41 -$2.93 $16.93
$76.86
$161.74
-$2.79 -$4.22 -$5.73 $5.19 $26.57$106.11
-$100
$
$100
$200
Cumulative Projected Savings, FY14-20, Risk & Inflation Adjusted
Rebaseline Cumulative Savings ($M) Original BCA Cumulative Savings ($M)
“Medically Ready Force…Ready Medical Force”
Research, Development and Acquisition Directorate
62
RADM Bruce A. Doll
Director, Research, Development & Acquisition
BLUF / Challenges / Wins
BLUF RDA is working towards Full Operating Capability (FOC)
On schedule to achieve FOC 1 Oct 2015
Challenges Finalized organizational structure
Predictability of funding
Wins Advanced Development (AD) Concept of Operations (CONOPs) completed
Initial Metrics Identified, baselines being collected
Strategic Plan drafted
63“Medically Ready Force...Ready Medical Force”
Briefing Date: XX Feb 2015 6464“Medically Ready Force…Ready Medical Force”
Research and Development: Objectives Alignment
Strategy Map Objectives Alignment
Objectives Supported High Level Initiatives Supporting Initiatives
IP2: Improve Operational Medicine
• Combat Casualty Care Research • Military Operational Medicine Research
• Hemorrhage Control and Resuscitation Program• Combat Casualty Care Training Initiative• Traumatic Brain Injury (TBI) Diagnosis R&D• Forward Surgical Care Initiative• Enroute Care research • Suicide Prevention R&D• Family and Community Health R&D• Post Traumatic Stress Disorder (PTSD) prevention R&D
IP3: Enhance Emerging Medical Capabilities in a Joint Environment
• Advance Medical Modeling and Simulation • Collaborative Medical Modeling and Simulation R&D
IP4: Enhance Strategic Partnerships
• Enhance Research Related Strategic Partnerships
• NATO engagement• Armed Serviced Biomedical Evaluation and Management
Committee (ASBREM) Initiatives • National Research Action Plan• Joint DoD-VA Review and Analysis
OC3: Optimize DHA as a Support Organization • Research and Development FOC Initiatives
• Clinical Investigation Programs• Protections Program Structures • Clinical Registries
64
“Medically Ready Force…Ready Medical Force”
RDA Directorate Key Measures
AreaManagement
QuestionMeasure Current Status Notes on Current Status
Target Date
to Begin
Development
Expected
Completion
Date
Cost
Are we maximizing
the amount of
research for dollars
invested?
Direct research dollars for
total dollars spent. BCA reinvestment initiative underway
Initiation of improved cost activity
accounting. September
2014Ongoing
Schedule
Can we speed the
development and
transition of
research products?
Institutional Review
Board/Human Research
Protection approval time
for multi-site clinical
research trials.
Average time from
program solicitations to
award.
RDA Human Research Protections and
Clinical Investigations Program
Working Group underway .
Baselining Awards Process .
Technology Transfer Improvements
underway.
September
2014
Annual
Progress
Review
(October
each year)
Performance
Are we getting the
knowledge and
material products
we need from our
RDA investment?
Number of clinical trials
completed.
Number of products
making it to Milestone
Decisions.
Number of fielded
products (Clinical
Practice Guidelines,
commercial products,
etc.).
Advanced Development (AD) structure
being implemented,
Joint Program Committee tracking of
outcomes underway.
Armed Services Biomedical Research
Evaluation Management (ASBREM)
COI improving multi-agency research
efforts.
September
2014
Annual
Progress
Review
(October
each year)
Reporting data
against targetsUnder
development
Developed, but no
baseline
Baseline and
targets existBaseline exists,
but no target
65
“Medically Ready Force…Ready Medical Force”
RDA Business Process Rengineering
Current Status
Net Savings Achieved to Date: None
Status Summary: Implementation in FY 15
Next Steps Owner Status Suspense Revised Suspense
Capability & Capacity AnalysisRDA
DirectorateSept 2014 Nov 2014
Redirection of Extramural FundingRDA
DirectorateOct 2015 Feb 2015
Advanced Development ImprovementRDA
DirectorateOct 2015
Research Protections & Multi-Site Clinical TrialsRDA
DirectorateJune 2015
Risks and Issues
Need to monitor costs to realize projected cost reinvestments
Overall Status: Complete On Schedule At Risk of Missing Suspense Missed Original Suspense
66
“Medically Ready Force…Ready Medical Force”
Research, Development & AcquisitionProjected Reinvestment
Reinvestment InitiativesEstimated Reinvestment ($M)
FY14 FY15 FY16 FY17 FY18 FY19 Cumulative
Redirection of Extramural Funding
Annual Reinvestment 0 0 9.82 20.01 30.96 31.64 92.43
Annual Costs 0 0 0 0 0 0 0
Annual Net Reinvestment
0 0 9.82 20.01 30.96 31.64 92.43
67
“Medically Ready Force…Ready Medical Force”
Progress Update
Task Forces recommendations on: Centers of Excellence
Advanced Development (AD)
Clinical Infrastructure / Regulatory & Laboratories
AD CONOPs completed
Shared Service Working Group ongoing efforts
Initial Metrics Identified, baselines being collected
Strategic Plan drafted
68
“Medically Ready Force…Ready Medical Force”
Medical Education & Training
69
Brig Gen (Dr.) Robert I. Miller
Director, Education and Training
Education & Training (E&T)BLUF / Challenges / Wins
BLUF E&T is working towards Full Operating Capability (FOC) by 1 Oct 2015
Focus on quality E&T, but cost savings expected - Learning Management System (LMS) and Modeling & Simulation (M&S)
Challenges Limited DHHQ staff but increased partnering opportunities
Medical Education & Training Campus (METC) a work in progress
Wins Allignment of METC, Defense Medical Readiness Training Institute (DMRTI),
Joint Medical Executive Skills Institute (JMESI) under E&T Directorate
Single Learning Management System (Joint Knowledge Online)
METC bridge programs and future academic affiliation with Uniformed Service University (USU) - “Train for the Mission…Educate for a Lifetime”
70
“Medically Ready Force…Ready Medical Force”
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
FY14 FY15 FY16 FY17 FY18 FY19
Mo
de
ling
& S
imu
lati
on
Savi
ngs
($
M)
$(1.50)
$(1.00)
$(0.50)
$-
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
FY14 FY15 FY16 FY17 FY18 FY19
Lear
nin
g M
anag
em
en
t Sy
ste
ms
Savi
ngs
($
M)
Summary of LMS Savings* ($M)
Education & Training FY14 - 19Projected Savings & Implementation Costs
71
FY14 FY15 FY16 FY17 FY18 FY19
Net Savings (Annual)$(0.03) $(0.87) $1.06 $0.95 $0.85 $0.77
Net Savings (Cumulative)
$(0.03) $(0.90) $0.16 $1.11 $1.96 $2.72
FY14-19
Gross SavingsImplementation
CostNet Savings
Return on Investment**
$3.62M $0.90 $2.72 ~3:1
*Subset of HIT sWG Portfolio Rationalization BCA; E&T will not formally track these savings
**ROI calculated as [Net Savings/Implementation Costs] : 1
Summary of M&S Net Savings ($M)
FY14-19
Gross SavingsImplementation
CostNet Savings
Return on Investment**
$5.07M $0*** $5.07M N/A**
FY14 FY15 FY16 FY17 FY18 FY19
Net Savings (Annual)$0.00 $0.00 $0.00 $1.05 $1.55 $2.47
Net Savings (Cumulative)
$0.00 $0.00 $0.00 $1.05 $2.60 $5.07
The projected potential savings are estimated to be $7.79M from FY14 to FY19.
“Medically Ready Force…Ready Medical Force”
Secretary of Defense
USD (P&R)ASD (HA)
Defense Health Agency Director
Education and Training Director
Policy Development
Policy Execution
Academic Review and
Policy Oversight
• Academic Metrics • Policy and Compliance• Training Agreement
Management• Strategic Planning• Learning Modalities
• eLearning (Learning Management System)
• Modeling & Simulation • Regulatory
Professional Development,
Sustainment and
Program Management
• Graduate Med/Den Education***
• MHS Leader Development (JMESI)
• Operational Training (DMRTI)• Leadership Development
Continuum (initial-Sustainment)***
• Officer/Enlisted/Civilian Professional Development***
• Program Standardization/ Reciprocity***
Administrative
Support
• Conference/CE/Certification approval and attendee package processing
• Tuition Payments/Student support
• CE Credit Granting• JGMESB Coordination• Centralized credentialing for
LIPOther functions as determined
by DHA E&T analysis
Authority, Direction and Control
Coordination
METCUSU*
* Consortium Partners** Consortium Partners and E&T Delivery platforms
*** E&T Directorate in coordination role
“Military Medical Education Consortium”
Coordinated affiliations to facilitate the delivery of quality
instruction
Healthcare Inter-service Training Office (HC-ITO) ***- Facilitate training review process
NMETC ** AMEDD C&S **AETC/SGU **
DMRTI
JMESICivilian
Partners
CCAF*
Education & TrainingOrganizational Chart at FOC
72
“Medically Ready Force…Ready Medical Force”
Education & Training Shared ServiceDeliverables
73
Deliverable MeasureReporting
FrequencyNotes on Current Status Status
Expected
Completion
Date
#1Align Medical Education and
Training Campus to DHA E&TN/A Action Complete. METC funds transfer to DHA in FY17. FY15
#2Align Joint Medical Executive
Skills Institute to DHA E&TN/A Action Complete. JMESI funds transfer to DHA in FY17. FY15
#3Align Defense Medical
Readiness Institute to DHA E&TN/A Action Complete. DMRTI funds transfer to DHA in FY17. FY15
#4One - Stop Learning
Management System
Semi-
annually
Migrate 11 of 11 Legacy LMSs to JKO by FY18
- JMESI migration complete Dec 14
- MHS Learn migration / EDC Jun 15
FY18
#5MHS Leadership
TrainingQuarterly
Determine standardized MHS leadership curricula development
- Draft leadership curricula complete/Services approved
(Joint Medical Executive Skills Institute / Dr. Durica)
FY17
#6 Award DegreesSemi-
annually
Develop METC/USUHS Academic Affiliation
- Meetings conducted w/key stakeholders, SEAs & DoD
decision authorities; momentum steady
- Unified Legislative Budget request in coordination
FY17
Complete On Schedule Not On Schedule
“Medically Ready Force…Ready Medical Force”
Education &Training Shared ServiceDeliverables
74
Deliverable MeasureReporting
FrequencyNotes on Current Status Status
Expected
Completion
Date
#7 Global Course Catalog Quarterly
Complete inventory of all E&T products across the services to
develop baseline
- MHS Global Catalog 40% complete / EDC Oct 15
FY16
#8METC Strategic
Partnerships
Semi-
annually
Goal is to develop bridge programs with civilian schools that
recognize METC training for college creditFY16
#9Military Medical Education
Consortium
Semi-
annually
Goal is to identify potential partners, develop, and establish
partnershipsFY16
#10 JGMESB Support Quarterly
- Way forward is to formally request that Services nominate
member(s) for JGMESB WG to develop POAM
- Overarching E&T Work Group charter is under development
FY18
#11Combat Casualty
Care
Semi-
annually
- Way forward is to conduct assessment of critical skills training
and identify training gaps, then develop plan of action
- Key stakeholders and SMEs have initiated & conducted meetings
FY18
#12Modeling &
SimulationQuarterly
- Align modeling & simulation functions across the MHS
- Standardize medical training and;
- Institutionalize shared Service skill sets for the enterprise to
support DHA portfolio
FY18
Complete On Schedule Not On Schedule
“Medically Ready Force…Ready Medical Force”
Public Health Division
Col Carol A. Fisher
Chief, Public Health Division
75
Public Health Division (PHD)BLUF / Challenges / Wins
BLUF IOC: 30 Sep 2014 with 3 of 4 Branches
Structured process in place to analyze 8 remaining product lines (PLs)
Challenges Transition of Armed Forces Health Surveillance Center to PHD
Re-baseline of projected cost savings
Availability of Service Subject Matter Experts for remaining PL analyses
Wins Ebola response effort
Periodic Health Assessment Optimization
Draft Strategic Plan
76
Briefing Date: 10 Mar 2015
Public Health Division
Progress Update
Milestone Indicator SuspenseRevised
SuspenseCompleted
Tra
nsit
ion
People Transfer to DHA (awaiting AFHSC) 30 Sep 14 12 Jul 15
Resources Transfer to DHA 1 Oct 15
Governance Update with Services – Charter, CONOPS 30 Sep 15
Public Health Division Manpower Assessment 15 Jun 15
Imp
lem
en
t
PL
1
Dep
loym
en
t
Healt
h
Re-baseline projected savings and efficiencies 30 Sep 15
WG charter for Medical Readiness Systems [i.e., MEDPROS,
MRRS, ASIMS] Portfolio Rationalization 1 May 15
PHA Optimization Effort – DoDI out for internal coord 16 Mar 15
Imp
lem
en
t
PL
2
Healt
h
Su
rveilla
nce
Awaiting transfer of AFHSC to Public Health Division 30 Sep 14 12 Jul 15
Imp
lem
en
t
PL
3
Imm
un
izati
o
n H
ealt
hc
are Assessment of the six Immunization Regional Offices for
efficiency opportunities – awaiting manpower study assessment30 Jun 15
Imp
lem
en
t
PL
4
Vete
rin
ary
Serv
ices Awaiting manpower study assessment
30 Jun 15
77Complete On Schedule At Risk of Missing Suspense
“Medically Ready Force...Ready Medical Force”7777
Briefing Date: 10 Mar 2015
Public Health Division
FY 14-19 BCA Costs & Projected Savings
BCA Category FY14 FY15 FY16 FY17 FY18 FY19 Total Primary Drivers of Implementation Costs
Deployment Health: Eliminate ANAM assessments; streamline PHA, and deployment health assessments; and change in Optimize Health Status
Savings ($M) $0.00 $8.68 $51.07 $77.81 $81.11 $84.68 $303.35 - Cost savings questionable due to NDAA 2015 annual person to person mental health assessment
- MBOG endorsed Deployment Health savings re-baseline effort; EDC: 30 Sept 2015
Cost ($M) $8.19 $6.84 $2.35 $2.07 $2.23 $2.05 $23.73
Net Savings ($M) ($8.19) $1.84 $48.72 $75.74 $78.88 $82.63 $279.62
Health Surveillance: Eliminate redundant surveillance databases/activities and derive economies of scale from process improvements
Savings ($M) $0.11 $2.02 $6.74 $9.48 $9.68 $9.90 $37.94 - Health Surveillance (AFHSC) delayed in transfer to DHA
- Implementation costs for process improvements
- Identification/elimination of redundant systems
Cost ($M) $4.30 $4.80 $8.20 $13.40 $3.10 $3.00 $36.80
Net Savings ($M) ($4.19) ($2.78) ($1.46) ($3.92) $6.58 $6.90 $1.14
$(0.9)
$47.3 $71.8 $85.5 $89.5
$(12.4) $(13.3)$33.9
$105.8 $191.2
$280.8
$(100)
$-
$100
$200
$300
FY14 FY15 FY16 FY17 FY18 FY19
Do
llars
(in
Mill
ion
s)Risk- and Inflation-Adjusted Project Savings, FY14-19
Annual Net Savings
Cumulative Net Savings
78 “Medically Ready Force...Ready Medical Force”78
Briefing Date: 10 Mar 2015
Public Health Division
Product Lines: Current & Future
Initial public health product lines (per CONOPs) Status
- Deployment Health Integrated at IOC; re-baselining cost savings
- Immunization Healthcare Integrated at IOC
- Veterinary Services Integrated at IOC
- Health Surveillance Pending transfer to DHA (EDC: July 2015)
8 additional product lines (per CONOPs) to be analyzed for recommended PHD FOC structure
Status
- Occupational & Environmental Health (Includes Occupational Health, Hearing Health, Industrial Hygiene, Environmental Health)
Initiate Analysis (Hearing Health only) March 2015
- Clinical Preventive Medicine Analysis not initiated
- Health Promotion Analysis not initiated
- Public Health Laboratories Analysis in-progress
- Radiation Health Analysis not initiated
- Food/Water Safety & Sanitation Initiate Analysis March 2015
- Entomology Analysis not initiated
- Health Risk Communication & Public Health Emergency Response Analysis not initiated
“Medically Ready Force...Ready Medical Force”79
“Medically Ready Force…Ready Medical Force”
Multi-Service Markets:2 or more Services, large beneficiary population,
45% direct care dollars, large GME & readiness platforms
The Eight Largest Markets (and Service/Department Leads)
= eMSM
= Single Service
National Capital Region (DHA)
Tidewater (Navy)
Ft. Bragg (Army)
San Antonio, Texas (rotate Air Force/Army)
Oahu, Hawaii (Army)
San Diego (Navy)
Puget Sound, Washington (Army)
Colorado Springs, Colorado (rotate Air Force/Army)
81
“Medically Ready Force…Ready Medical Force”
Multi-Service Markets include Colorado Springs, Hawaii, the National
Capital Region, Puget Sound, San Antonio, and Tidewater (with San
Diego and Ft Bragg Pope as large market participants)
2 or more Services; large beneficiary population; almost 50% of our
direct care spending; and largest readiness / training platforms
The Plans focused on becoming an Integrated Health Delivery System,
and identified opportunities to increase enrollment at military clinics,
increase provider productivity, and reduce Private-Sector costs
MHS leadership reviews eMSM performance quarterly to enhanced
accountability. If performance is below target, Service leads work with
eMSMs to develop remediation plans
Enhanced Multi-Service Markets (eMSM) Overview
“Medically Ready Force…Ready Medical Force”
pwcPre-Decisional Deliberative Matter -- For Official Use Only Within DoD
Executive SummaryNCR eMSM
FY15 FY16 FY17 FY18 FY19 FY20 FY16-20 Total
Net Estimated Savings ($M)
Savings $71.7M $109.0M $126.9M $137.9M $138.0M $138.0M $649.9M
Costs $18.6M $28.3M $32.9M $35.8M $35.8M $35.8M $168.6M
Net $53.1M $80.7M $94.0M $102.1M $102.2M 102.2M $481.3M
Productivity
Productivity Target Targeted Annual Productivity (PA wRVUs) 5-Yr Change
261K 1.57M 1.73M 1.93M 2.03M 2.08M 2.08M 343K
Total Enrollment
Total Enrollment Target Targeted Total Annual Enrollment 5-Yr Change
Prime: 277.0K 219.0K 255.8K 267.4K 277.0K 277.0K 277.0K 21.2K
Plus: 23.0K 22.0K 22.2K 22.6K 23.0K 23.0K 23.0K 0.8K
Total 300.0K 241.0K 278.0K 290.0K 300.0K 300.0K 300.0K 22.0K
Recapture
Recapture Target Annual Recapture ($M) FY16-20 Total
$71.7M $109M $126.9M $138M $138M $138M $649.9M
Initiative
Impact Net Savings
Potential
($M)
Implementation
Costs
($M)
Total
Productivity
Change
Total
Enrollment
Change
Total
Recapture
($M)Readiness Health
Health
Care Cost Access Quality Safety
High Reliability Culture of Quality
and Patient PartnershipCAPT Vedral-Baron
FBCH • • • • • • •Quality and safety improvements have direct impact on cost (e.g., cost avoidance
of repeat surgeries, complications, litigation, etc.) not reflected in this model
Referral Management, Template
Management, and Appointing (RM)Col Cantilina
779th MDG • • • • • • • $191.9 $13.2 58.6K $205.1
Operating Room (OR) OptimizationBG Clark
WRNMMC • • • • • • $219.2 $93.9 88.0K $313.1
Patient Centered Medical Home
(PCMH) 2.0CAPT Smith
NBHC Quantico • • • • • $70.2 $61.5 196.7K 21.9K $131.7
Secure MessagingLt Col Hanson
579th MDG • • •Secure messaging and other tools (e.g., Nurse Advice Line) support the PCMH
Initiative and impact cost through avoiding ED/UCC visits.
Total $481.3 $168.6 343.3K 21.9K $649.9
Capability Overview
# MTFs
# ORs # Total Beds
Skill Type 1 & 2
Providers
Total DHP
Direct Care
Funding*Physical Staffed Physical Staffed
19 38 35 442 388 1,335 $1.3B
* Estimated, includes MILPERS
FY15 Population
Eligible Population MTF-Enrolled / Empaneled MCSC-Enrolled Prime
All 455K Prime 219K 34K
Medicare Eligible 78K Plus 22K Johns Hopkins (FHP)
Total 241K 35K
Walter Reed National Military Medical Center
• DiLorenzo TRICARE Health Clinic
• Branch Medical Clinic Carderock
• National Intrepid Center of Excellence
Fort Belvoir Community Hospital
• Fairfax Health Center
• Dumfries Health Center
Naval Health Clinic Quantico
• Naval Branch Health Clinic Washington Navy Yard
• Branch Medical Clinic OCS Brown Field
• Naval Branch Health Clinic The Basic School
Kimbrough Ambulatory Care Center
• McNair Army Health Clinic
• Andrew Rader Army Health Clinic
Naval Health Clinic Annapolis
• Naval Branch Health Clinic
Bancroft Hall
779th Med Group Joint Base Andrews
579th Med Group Joint Base Anacostia-Bolling
Branch Medical Clinic Naval Research Lab Washington
Naval Branch Health Clinic Joint Base Andrews
83
“Medically Ready Force…Ready Medical Force”
NCR Business Plan Initiatives Summary
84
Initiative Key Focus Areas Key Successes
High ReliabilityCulture of Quality and Patient
Partnership
CAPT Vedral-Baron (FBCH)
• TeamSTEPPS• Patient Centered Caring Communication Initiative (PCCCI) Provider
Training• Expand the Partnership for Patients (PfP) to Outpatient Facilities• Establish market-wide HEDIS monitoring program• Inaugural Quality Summit, April 2015
• Reached the 90th percentile on Breast Cancer Screening as a market.• Over 45% of the eMSM has entered sustainment mode for TeamSTEPPS• Completed development of all evidenced-based bundles for Partnership for
Patients
Referral Management, Template Management, and
Appointing (RM)
COL Cantilina(779th)
• Governance by Product Line• Template Management & Booking• Consolidate/map ancillary procedure codes and standardize
review/prioritization process• Establish capability for booking patient follow-up visit at checkout
• 50% reduction in medical Services deferrals to the network for capacity from November 2013 to November 2014.
• Building on the Orthopedics successes with outbound proactive booking, the NCR eMSM is capitalizing on the standardization of the product line templates and processes by developing a specialized team of call center agents focused on all Orthopedic appointment needs – both outbound and inbound.
Operating Room (OR) Optimization
BG Clark(WRNMMC)
• Reorganize Surgical Management across the Market• Standardize templates and appointment types across eMSM• Credential surgeons at multiple MTFs• NCR market approach to meet critical regional deficiencies in Physical
Therapy
• 26% decrease in private sector Orthopedic Surgeon encounters and 36%decrease in costs for market enrollees from FY13 to FY14
• 7% increase in direct care Orthopedic Surgical cases over the same timeframe
Patient-Centered Medical Home (PCMH) 2.0
CAPT Smith(Quantico)
• Access to Primary Care• Market-wide PCMH maturity• Timely and relevant data• ED/UCC usage
• Expanding its primary care footprint at two locations, Fairfax and Dumfries, both near beneficiary population centers.
• Realigning of the Fort Belvoir Family Practice Residency Program to maximize access to primary care
Enrollment
LTC Wienberg(Rader/McNair)
• The Enrollment team is assessing where and how to enroll new eligible beneficiaries, and determine the type and quantity of eligible beneficiaries each MTF can take on while still providing quality care.
• The market will increase its enrollment capacity by 10,000 enrollees by the end of FY15
• FY13-14 NCR enrolled over 6,000 patients increasing total enrollment from 236,000 to 242,000.
Secure Messaging
Lt Col Hanson(579th)
• Patient Registration• Provider Registration and Active Utilization• Response time• Training• Policy change
• Nearly eliminated endocrinology leakage to the network since implementing Provider-to-Provider secure messaging at WRNMMC since March 2014.
• Patient adoption at 589th is increasing and correlated with a drop in urgent care usage.
The DHA Supports the Military Services
86
The DHA reports to the ASD(HA) and provides support to the three Military Services.