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entitled 'VA and DOD Health Care: Resource Sharing At Selected Sites' 
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Report to the Chairman, Subcommittee on Oversight and Investigations, 
Committee on Veterans' Affairs, House of Representatives:

United States Government Accountability Office:

GAO:

July 2004:

VA and DOD Health Care:

Resource Sharing at Selected Sites:

GAO-04-792:

GAO Highlights:

Highlights of GAO-04-792, a report to the Chairman, Subcommittee on 
Oversight and Investigations, Committee on Veterans' Affairs, House of 
Representatives:  

Why GAO Did This Study:

Congress has long encouraged the Department of Veterans Affairs (VA) 
and the Department of Defense (DOD) to share health resources to 
promote cost-effective use of health resources and efficient delivery 
of care. In February 2002, the House Committee on Veterans’ Affairs 
described VA and DOD health care resource sharing activities at nine 
locations. GAO was asked to describe the health resource sharing 
activities that are occurring at these sites. GAO also examined seven 
other sites that actively participate in sharing activities. 
Specifically, GAO is reporting on (1) the types of benefits that have 
been realized from health resource sharing activities and (2) VA- and 
DOD-identified obstacles that impede health resource sharing.

GAO analyzed agency documents and interviewed officials at DOD and VA 
to obtain information on the benefits achieved through sharing 
activities. The nine sites reviewed by the Committee and reexamined by 
GAO are: 1) Los Angeles, CA; 2) San Diego, CA; 3) North Chicago, IL; 4) 
Albuquerque, NM; 5) Las Vegas, NV; 6) Fayetteville, NC; 7) Charleston, 
SC; 8) El Paso, TX; and 9) San Antonio, TX. The seven additional sites 
GAO examined are: 1) Anchorage, AK; 2) Fairfield, CA; 3) Key West, FL; 
4) Pensacola, FL; 5) Honolulu, HI; 6) Louisville, KY; and 7) Puget 
Sound, WA. In commenting on a draft of this report, the departments 
generally agreed with our findings.

What GAO Found:

At the 16 sites GAO reviewed, VA and DOD are realizing benefits from 
sharing activities, specifically better facility utilization, greater 
access to care, and reduced federal costs. While all 16 sites are 
engaged in health resource sharing activities, some sites share 
significantly more resources than others. For example, at one site VA 
was able to utilize Navy facilities to provide additional sources of 
care and reduce its reliance on civilian providers, thus lowering its 
purchased care cost by about $385,000 annually. Also, because of the 
sharing activity taking place at this site, VA has modified its plans 
to build a new $100 million hospital and instead plans to build a 
clinic that will cost about $45 million. However, at another site the 
sharing activity was limited to the use of a nurse practitioner to 
assist with primary care and the sharing of a psychiatrist and a 
psychologist.

GAO found that the primary obstacle cited by almost all of the agency 
officials interviewed was the inability of VA and DOD computer systems 
to communicate and exchange patient health information between 
departments. VA and DOD medical facilities involved in treating both 
agencies’ patient populations must expend staff resources to enter 
information on the health care provided into the patient records in 
both systems. Local VA officials also expressed a concern that security 
screening procedures have increased the time it takes for VA 
beneficiaries and their families to gain entry to facilities located on 
Air Force, Army, and Navy installations during periods of heightened 
security. 

www.gao.gov/cgi-bin/getrpt?GAO-04-792.

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Cynthia A. Bascetta at 
(202) 512-7101.

[End of section]

Contents:

Letter:

Results in Brief:

Background:

Resource Sharing Activities Result in Better Access and Reduced Costs:

VA and DOD Identified Two Obstacles that Impede Resource Sharing:

Agency Comments and Our Evaluation:

Appendix I: Scope and Methodology:

Appendix II: Resource Sharing at 16 Sites:

Anchorage, Alaska:

Fairfield, California:

Los Angeles, California:

San Diego, California:

Key West, Florida:

Pensacola, Florida:

Honolulu, Hawaii:

North Chicago, Illinois:

Louisville, Kentucky:

Las Vegas, Nevada:

Albuquerque, New Mexico:

Fayetteville, North Carolina:

Charleston, South Carolina:

El Paso, Texas:

San Antonio, Texas:

Puget Sound, Washington:

Appendix III: Comments from the Department of Veterans Affairs and the 
Department of Defense:

Related GAO Products:

Abbreviations:

CMAC: Civilian Health and Medical Program of the Uniformed Services 
(CHAMPUS) Maximum Allowable Charge: 
CMOP: Consolidated Mail Outpatient Pharmacy: 
DOD: Department of Defense: 
ICU: Intensive Care Unit: 
MRI: magnetic resonance imaging: 
MTF: military treatment facility: 
VA: Department of Veterans Affairs: 
VHA: Veterans Health Administration: 
VAMC: VA medical center:

United States Government Accountability Office:

Washington, DC 20548:

July 21, 2004:

The Honorable Steve Buyer: 
Chairman: 
Subcommittee on Oversight and Investigations: 
Committee on Veterans' Affairs: 
House of Representatives:

Dear Mr. Chairman:

In 1982, Congress passed the Veterans' Administration and Department of 
Defense Health Resources Sharing and Emergency Operations Act (Sharing 
Act) to promote cost-effective use of health care resources and 
efficient delivery of care.[Footnote 1] Specifically, Congress 
authorized the Department of Veterans Affairs (VA)[Footnote 2] medical 
centers and the Department of Defense (DOD) military treatment 
facilities to enter into sharing agreements with each other to buy, 
sell, and barter medical and support services. Following the Sharing 
Act, Congress passed legislation to encourage and foster sharing of 
resources between VA and DOD--including start-up funds for sharing 
projects, expanded legal authority to enter into agreements, and 
funding for demonstration projects.[Footnote 3] You have an interest in 
the benefits that result from sharing activities and the obstacles that 
impede sharing. At your request, this report provides information on 
(1) the types of benefits that have been realized from health resource 
sharing activities and (2) VA-and DOD-identified obstacles that impede 
health resource sharing.

This report describes the benefits that are being realized at 16 VA and 
DOD sites that are engaged in health resource sharing activities. Nine 
of the sites[Footnote 4] were the focus of a February 2002 House 
Committee on Veterans' Affairs report[Footnote 5] that described health 
resource sharing activities between VA and DOD. We selected seven other 
sites that actively participated in sharing activities[Footnote 6] to 
ensure representation from each service at locations throughout the 
nation. We analyzed agency documents and interviewed officials at VA 
and DOD, including headquarters staff and field office staff who manage 
sharing activities at the 16 sites. We made field visits to six of 
them. We obtained documentation on improvements or enhancements to the 
delivery of health care to beneficiaries, and on cost reductions. Ten 
sites provided information on estimated cost reductions. We reviewed 
the supporting documentation and obtained clarifying information from 
agency officials. We also obtained documentation and the opinions of 
agency officials on the obstacles that exist either internally (within 
their own agency) or externally (with their sharing partner) to 
resource sharing activities. We obtained and reviewed VA and DOD 
policies and regulations governing sharing agreements and reviewed 
relevant reports from the DOD Inspector General, DOD contractors, and 
our prior work. Our work was performed from June 2003 through June 2004 
in accordance with generally accepted government auditing standards. 
For more details on our scope and methodology, see appendix I.

Results in Brief:

VA and DOD are realizing benefits from sharing activities, 
specifically, better facility utilization, greater access to care, and 
reduced federal costs at the 16 sites we reviewed. While all 16 sites 
are engaged in health resource sharing activities, some sites share 
significantly more resources than others. For example, at one site VA 
was able to utilize Navy facilities to provide additional sources of 
care and reduce its reliance on civilian providers, thus lowering its 
purchased care cost by about $385,000 annually. Also, because of the 
sharing activity taking place at this site, VA has modified its plans 
to build a new $100 million hospital and instead plans to build a 
clinic that will cost about $45 million. However, at another site the 
sharing activity was limited to the use of a nurse practitioner to 
assist with primary care and the sharing of a psychiatrist and a 
psychologist.

The primary obstacle cited by almost all of the officials we 
interviewed from both agencies was the inability of VA and DOD computer 
systems to communicate and exchange patient health information between 
departments. Hence, VA and DOD medical facilities involved in treating 
both agencies' patient populations must expend staff resources to enter 
health care information into both systems. Local VA officials also 
expressed a concern that security screening procedures have increased 
the time it takes for VA beneficiaries and their families to gain entry 
to facilities located on Air Force, Army, and Navy installations during 
periods of heightened security.

VA and DOD commented on a draft of this report and generally agreed 
with our findings.

Background:

VA operates one of the nation's largest health care systems, spending 
about $26.5 billion a year to provide care to approximately 5.2 million 
veterans who receive health care through 158 VA medical centers (VAMC) 
and almost 900 outpatient clinics nationwide. DOD spends about $26.7 
billion on health care for over 8.9 million beneficiaries, including 
active duty personnel and retirees, and their dependents. Most DOD 
health care is provided at more than 530 Army, Navy, and Air Force 
military treatment facilities (MTF) worldwide, supplemented by civilian 
providers.

To encourage sharing of federal health resources between VA and DOD, in 
1982, Congress passed the Sharing Act. Previously, VA and DOD health 
care facilities, many of which are collocated or in close geographic 
proximity, operated virtually independent of each other. The Sharing 
Act authorizes VAMCs and MTFs to become partners and enter into sharing 
agreements to buy, sell, and barter medical and support services. The 
head of each VA and DOD medical facility can enter into local sharing 
agreements. However, VA and DOD headquarters officials review and 
approve agreements that involve national commitments such as joint 
purchasing of pharmaceuticals. Agreements can be valid for up to 5 
years. The intent of the law was not only to remove legal barriers, but 
also to encourage VA and DOD to engage in health resource sharing to 
more effectively and efficiently use federal health resources.

VA and DOD sharing activities fall into three categories:

* Local sharing agreements allow VA and DOD to take advantage of their 
capacities to provide health care by being a provider of health 
services, a receiver of health services, or both. Health services 
shared under these agreements can include inpatient and outpatient 
care; ancillary services, such as diagnostic and therapeutic radiology; 
dental care; and specialty care services such as service for the 
treatment of spinal cord injury. Other services shared under these 
agreements include support services such as administration and 
management, research, education and training, patient transportation, 
and laundry. The goals of local sharing agreements are to allow VAMCs 
and MTFs to exchange health services in order to maximize their use of 
resources and provide beneficiaries with greater access to care.

* Joint venture sharing agreements, as distinguished from local sharing 
agreements, aim to avoid costs by pooling resources to build a new 
facility or jointly use an existing facility. Joint ventures require 
more cooperation and flexibility than local agreements because two 
separate health care systems must develop multiple sharing agreements 
that allow them to operate as one system at one location.

* National sharing initiatives are designed to achieve greater 
efficiencies, that is, lower cost and better access to goods and 
services when they are acquired on a national level rather than by 
individual facilities--for example, VA and DOD's efforts to jointly 
purchase pharmaceuticals for nationwide distribution.

Resource Sharing Activities Result in Better Access and Reduced Costs:

VA and DOD are realizing benefits from sharing activities, specifically 
greater access to care, reduced federal costs, and better facility 
utilization at the 16 sites we reviewed. While all 16 sites were 
engaged in health resource sharing activities, some sites share 
significantly more resources than others.

In 1994 VA and DOD opened a joint venture hospital in Las Vegas, 
Nevada, to provide services to VA and DOD beneficiaries. The joint 
venture improved access for VA beneficiaries by providing an 
alternative source for care other than traveling to VA facilities in 
Southern California. It also improved access to specialized providers 
for DOD beneficiaries. Examples of the types of services provided 
include vascular surgery, plastic surgery, cardiology, pulmonary, 
psychiatry, ophthalmology, urology, computed tomography scan, magnetic 
resonance imaging (MRI); nuclear medicine, emergency medicine and 
emergency room, and respiratory therapy.[Footnote 7] The site is 
currently in the process of enlarging the emergency room.

In Pensacola, Florida, under a sharing agreement entered into in 2000, 
VA buys most of its inpatient services from Naval Hospital Pensacola. 
Through this agreement VA is able to utilize Navy facilities and reduce 
its reliance on civilian providers, thus lowering its purchased care 
cost by about $385,000 annually. Further, according to a VA official, 
the agreement has allowed VA to modify its plans to build a new 
hospital and instead build a clinic at significantly reduced cost to 
meet increasing veteran demand for health care services. Using VA's 
cost per square foot estimates for hospital and clinic construction, 
the agency estimates that it will cost $45 million[Footnote 8] to build 
a new clinic compared to $100 million for a hospital.

In Louisville, Kentucky, since 1996, VA and the Army have been engaged 
in sharing activities to provide services to beneficiaries that include 
primary care, audiology, radiology, podiatry, urology, internal 
medicine, and ophthalmology. For fiscal year 2003, a local VA official 
estimated that VA reduced its cost by $1.7 million as compared to 
acquiring the same services in the private sector through its 
agreements with the Army; he also estimated that the Army reduced its 
cost by about $1.25 million as compared to acquiring the same services 
in the private sector. As an example of the site's efforts to improve 
access to care and reduce costs, in 2003 VA and DOD jointly leased a 
MRI unit. The unit reduces the need for VA and DOD beneficiaries to 
travel to more distant sources of care. A Louisville VA official stated 
that the purchase reduced the cost by 20 percent as compared to 
acquiring the same services in the private sector.

In San Antonio, Texas, VA and the Air Force share a blood bank. Under a 
1991 sharing agreement, VA provides the staff to operate the blood bank 
and the Air Force provides the space and equipment. According to VA, 
the blood bank agreement saves VA and DOD about $400,000 per year. 
Further, VA entered into a laundry service agreement with Brooke Army 
Medical Center in 2002 to utilize some of VA's excess laundry capacity. 
Under the contract VA processes 1.7 million pounds of laundry each year 
for the Army at an annual cost of $875,000.

Sites such as Las Vegas, Nevada; Pensacola, Florida; Louisville, 
Kentucky; and San Antonio, Texas shared significant resources compared 
to sites at Los Angeles, California and Charleston, South Carolina. For 
example, the sharing agreement at Los Angeles provided for the use of a 
nurse practitioner to assist with primary care and the sharing of a 
psychiatrist and a psychologist. See appendix II for the VA and DOD 
partners at each of the 16 sites and examples of the sharing activities 
taking place.

VA and DOD Identified Two Obstacles that Impede Resource Sharing:

The primary obstacle cited by officials at 14 of 16 sites we 
interviewed was the inability of computer systems to communicate and 
share patient health information between departments. Furthermore, 
local VA and DOD officials involved with sharing activities raised a 
concern that security check-in procedures implemented since September 
11, 2001, have increased the time it takes to gain entry to medical 
facilities located on military installations during periods of 
heightened security.

VA and DOD Computer Systems Cannot Share Patient Record Information:

VA's and DOD's patient record systems cannot share patient health 
information electronically. The inability of VA's and DOD's patient 
record systems to quickly and readily share information on the health 
care provided at medical facilities is a significant obstacle to 
sharing activities. One critical challenge to successfully sharing 
information will be to standardize the data elements of each 
department's health records. While standards for laboratory results 
were adopted in 2003, VA and DOD face a significant undertaking to 
standardize the remaining health data. According to the joint strategy 
that VA and DOD have developed, VA will have to migrate over 150 
variations of clinical and demographic data to one standard, and DOD 
will have to migrate over 100 variations of clinical data to one 
standard.

The inability of VA and DOD computer systems to share information 
forces the medical facilities involved in treating both agencies' 
patient populations to expend staff resources to maintain patient 
records in both systems. For example, at Travis Air Force Base, both 
patient records systems have been loaded on to a single workstation in 
each department, so that nurses and physicians can enter patient 
encounter data into both systems. However, the user must access and 
enter data into each system separately. In addition to VA and DOD 
officials' concerns about the added costs in terms of staff time, this 
method of sharing medical information raises the potential for errors-
-including double entry and transcription--possibly compromising 
medical data integrity.[Footnote 9]

VA and DOD have been working since 1998 to modify their computer 
systems to ensure that patient health information can be shared between 
the two departments. In May 2004, we reported that they have 
accomplished a one-way transfer of limited health data from DOD to VA 
for separated service members.[Footnote 10] Through the transfer, 
health care data for separated service members are available to all VA 
medical facilities. This transfer gives VA clinicians the ability to 
access and display health care data through VA's computerized patient 
record system remote data views[Footnote 11] about 6 weeks after the 
service member's separation. The health care data include laboratory, 
pharmacy, and radiology records, and are available for approximately 
1.8 million personnel who separated from the military between 1987 and 
June 2003. A second phase of the one-way transfer, completed in 
September 2003, added to the base of health information available to VA 
clinicians by including discharge summaries,[Footnote 12] allergy 
information, admissions information, and consultation 
results.[Footnote 13]

VA and DOD are developing a two-way transfer of health information for 
patients who obtain care from both systems. Patients involved include 
those who receive care and maintain health records at multiple VA or 
DOD medical facilities within and outside the United States. Upon 
viewing the medical record, a VA clinician would be provided access to 
clinical information on the patient residing in DOD's computerized 
health record systems. In the same manner, when a veteran seeks medical 
care at an MTF, the attending DOD clinician would be provided access to 
the veteran's health information existing in VA's computerized health 
record systems.

In May 2004, we reported that VA's and DOD's approach to achieving the 
two-way transfer of health information lacks a solid foundation and 
that the departments have made little progress toward defining how they 
intend to accomplish it.[Footnote 14] In March 2004 and June 
2004,[Footnote 15] we also reported that VA and DOD have not fully 
established a project management structure to ensure the necessary day-
to-day guidance of and accountability for the undertaking, adding to 
the challenge and uncertainties of developing two-way information 
exchange. Further, we reported that the departments were operating 
without a project management plan that describes their specific 
development, testing, and deployment responsibilities. These issues 
cause us to question whether the departments will meet their 2005 
target date for two-way patient health information exchange.

Security Procedures Increase Time to Gain Access to MTFs During Periods 
of Heightened Security:

During times of heightened security since September 11, 2001, according 
to VA and DOD officials, screening procedures have slowed entry for VA 
beneficiaries, and particularly for family members who accompany them, 
to facilities located on Air Force, Army, and Navy installations. For 
example, instead of driving onto Nellis Air Force Base in Las Vegas and 
parking at the medical facility, veterans seeking treatment there must 
park outside the base perimeter, undergo a security screening, and wait 
for shuttle services to take them to the hospital for care.

Although sharing occurs in North Carolina between the Fayetteville VA 
Medical Center and the Womack Army Medical Center, Ft. Bragg, the VA 
hospital administrator expressed concerns regarding any future plans to 
build a joint VA and DOD clinic at Ft. Bragg due to security 
precautions--identity checks and automobile searches--that VA 
beneficiaries encounter when attempting to access care. Consequently, 
the administrator prefers that any new clinics be located on VA 
property for ease of access for all beneficiaries.

VA provided an example of how it and DOD are working to help resolve 
these problems. In Pensacola, Florida, VA is building a joint 
ambulatory care clinic on Navy property through a land-use arrangement. 
According to VA, veterans' access to the clinic will be made easier. A 
security fence will be built around the building site on shared VA and 
Navy boundaries and a separate entrance and access road to a public 
highway will allow direct entry. Special security arrangements will be 
necessary only for those veterans who are referred for services at the 
Navy medical treatment facility. Veterans who come to the clinic for 
routine care will experience the same security measures as at any other 
VA clinic or medical center. VA believes this arrangement gives it 
optimal operational control and facilitates veterans' access while 
addressing DOD security concerns.

Agency Comments and Our Evaluation:

We requested comments on a draft of this report from VA and DOD. Both 
agencies provided written comments that are found in appendix III. VA 
and DOD generally agreed with our findings. They also provided 
technical comments that we incorporated where appropriate.

In commenting on this draft, VA stated that VA and DOD are developing 
an electronic interface that will support a bidirectional sharing of 
health data. This approach is set forth in the Joint VA/DOD Electronic 
Health Records Plan. According to VA, the plan provides for a 
documented strategy for the departments to achieve interoperable health 
systems in 2005. It included the development of a health information 
infrastructure and architecture, supported by common data, 
communications, security, software standards, and high-performance 
health information. VA believes these actions will achieve the two-way 
transfer of health information and communication between VA's and DOD's 
information systems.

In their comments, DOD acknowledged the importance of VA and DOD 
developing computer systems that can share patient record information 
electronically. According to DOD, VA and DOD are taking steps to 
improve the electronic exchange of information. For example, VA and DOD 
have implemented a joint project management structure for information 
management and information technology initiatives--which includes a 
single Program Manager and a single Deputy Program Manager with joint 
accountability and day-to-day responsibility for project 
implementation. Further, VA and DOD continue to play key roles as lead 
partners to establish federal health information interoperability 
standards as the basis for electronic health data transfer.

We recognize that VA and DOD are taking actions to implement the Joint 
VA/DOD Electronic Health Records Plan and the joint project management 
structure, and that they face significant challenges to do so. 
Accomplishing these tasks is a critical step for the departments to 
achieve interoperable health systems by the end of 2005.

DOD also agreed with the GAO findings on issues relating to veterans 
access to military treatment facilities located on Air Force, Army, and 
Navy installations during periods of heightened security. DOD stated 
that they are working diligently to solve these problems, but are 
unlikely to achieve an early resolution. They also stated that as VA 
and DOD plan for the future, they will consider this issue during the 
development of future sharing agreements and joint ventures.

We are sending copies of this report to the Secretary of Veterans 
Affairs, the Secretary of Defense, interested congressional committees, 
and other interested parties. We will also make copies available to 
others upon request. In addition, this report is available at no charge 
on GAO's Web site at http://www.gao.gov. If you or your staff have any 
questions about this report, please call me at (202) 512-7101 or 
Michael T. Blair, Jr., at (404) 679-1944. Aditi Shah Archer and Michael 
Tropauer contributed to this report.

Sincerely yours,

Signed by: 

Cynthia A. Bascetta: 
Director, Health Care--Veterans' Health and Benefits Issues:

[End of section]

Appendix I: Scope and Methodology:

This report describes the benefits that are being realized at 16 
Department of Veterans Affairs (VA) and Department of Defense (DOD) 
sites that are engaged in health resource sharing activities. Nine of 
the sites[Footnote 16] were the focus of a February 2002 House 
Committee on Veterans' Affairs report[Footnote 17] that described 
health resource sharing activities between VA and DOD. We selected 
seven other sites that actively participated in sharing 
activities[Footnote 18] to ensure representation from each service at 
locations throughout the nation. To obtain information on the resources 
that are being shared we analyzed agency documents and interviewed 
officials at VA and DOD headquarters offices and at VA and DOD field 
offices who manage sharing activities at the 16 sites.

To gain information on the benefits of sharing and the problems that 
impede sharing at selected VA and DOD sites, we asked VA and DOD 
personnel at 16 sites to provide us with information on:

* shared services provided to beneficiaries including improvements or 
enhancements to delivery of health care to beneficiaries,

* reduction in costs,

* and their opinions on barriers or obstacles that exist either 
internally (within their own agency) or externally (with their partner 
service or agency).

Ten sites provided information on estimated cost reductions. We 
reviewed the supporting documentation and obtained clarifying 
information from agency officials. Based on our review of the 
documentation and subsequent discussions with agency officials we 
accepted the estimates as reasonable.

From the 16 sites, we judgmentally selected the following 6 sites to 
visit: 1) Fairfield, California; 2) Pensacola, Florida; 3) Louisville, 
Kentucky; 4) Fayetteville, North Carolina; 5) Las Vegas, Nevada; and 6) 
Charleston, South Carolina. At the sites we visited, we interviewed 
local VA and DOD officials to obtain their views on resource-sharing 
activities and obtained documents from them on the types of services 
that were being shared. The sites were selected based on the following 
criteria: 1) representation from each military service; 2) geographic 
location; and 3) type of sharing agreement--local sharing agreement, 
joint venture, or participant in a national sharing initiative.

We conducted telephone interviews with agency officials at the 10 sites 
that we did not visit and requested supporting documentation from them 
to gain an understanding of the sharing activities underway at each 
site.

We obtained and reviewed VA and DOD policies and regulations governing 
sharing agreements and reviewed our prior work[Footnote 19] and 
relevant reports issued by the DOD Inspector General and DOD 
contractors. Our work was performed from June 2003 through June 2004 in 
accordance with generally accepted government auditing standards.

[End of section]

Appendix II: Resource Sharing at 16 Sites:

Anchorage, Alaska:

Partners: Alaska VA Healthcare System and 3rd Medical Group, Elmendorf 
Air Force Base:

The Department of Veterans Affairs (VA) and the Air Force have had a 
resource-sharing arrangement since 1992. Building upon that 
arrangement, in 1999, VA and the Air Force entered into a joint venture 
hospital. According to VA and Air Force officials, they have been able 
to efficiently and effectively provide services to both VA and the 
Department of Defense (DOD) beneficiaries in the Anchorage area that 
would not have been otherwise possible. The services to VA and DOD 
beneficiaries include emergency room, outpatient, and inpatient care. 
Other services the Air Force provides VA includes diagnostic radiology, 
clinical and anatomical pathology, nuclear medicine, and MRI. VA 
contributes approximately 60 staff toward the joint venture. VA staff 
are primarily responsible for operating the 10-bed intensive care unit 
(ICU). For fiscal year 2002, a DOD official estimated that the Air 
Force avoids costs of about $6.6 million by utilizing the ICU as 
compared to acquiring the same services in the private sector. Other VA 
staffing in the hospital lends support to the emergency department, 
medical and surgical unit, social work services, supply processing and 
distribution, and administration.

Fairfield, California:

Partners: VA Northern California Health Care System and 60th Medical 
Group, Travis Air Force Base:

In 1994, VA and the Air Force entered into a joint venture at Travis 
Air Force Base. Under this joint venture, VA contracts for inpatient 
care, radiation therapy, and other specialty, ancillary, and after-
hours teleradiology services it need from the Air Force. In return, the 
Air Force contracts for ancillary and pharmacy support from VA. The 
most recent expansion of the joint venture in 2001 included activation 
of a VA clinic located adjacent to the Air Force hospital--this clinic 
includes a joint neurosurgery clinic.

Each entity currently reimburses the other at 75 percent of the 
Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) 
Maximum Allowable Charge (CMAC)[Footnote 20] rate. In March 2004, a VA 
official estimated that the VA saves about $500,000 per year by 
participating in the joint venture and an Air Force official estimated 
that the Air Force saves about $300,000 per year through the joint 
venture.

Los Angeles, California:

Partners: Veterans Affairs Greater Los Angeles Healthcare System and 
61st Medical Squadron, Los Angeles Air Force Base:

The Air Force contracts for mental health services from the Veterans 
Affairs medical center (VAMC). According to Air Force and VA local 
officials, there are two agreements in place; first, VA provides a 
psychologist and a psychiatrist who provide on-site services to DOD 
beneficiaries (one provider comes once a week, another provider comes 2 
days a month). The total cost of this annual contract is about 
$200,000. According to the Air Force, it is paying 90 percent of the 
CMAC rate for these services and is thereby saving about $20,000 to 
$22,000 a year. Second, the Air Force is using a VA nurse practitioner 
to assist with primary care. The cost savings were not calculated but 
the Air Force stated that VA was able to provide this staffing at a 
significantly reduced cost as compared to contracting with the private 
sector.

San Diego, California:

Partners: VA San Diego Healthcare System and Naval Medical Center San 
Diego:

VA provides graduate medical education, pathology and laboratory 
testing, and outpatient and ancillary services to the Navy. According 
to Navy officials, the sharing agreements resulted in a cost reduction 
of about $100,000 per year for fiscal years 2002 and 2003. As of June 
2004, VA and the Navy were in the process of finalizing agreements for 
sharing radiation therapy, a blood bank, and mammography services.

In fiscal year 2003, San Diego was selected as a pilot location for the 
VA/DOD Consolidated Mail Outpatient Pharmacy (CMOP) program.[Footnote 
21] A naval official at San Diego considers the pilot a success at this 
location because participation was about 75 percent and it helped 
eliminate traffic, congestion, and parking problems associated with 
beneficiaries on the Navy's medical campus who come on site for 
medication refills--an average of 350 patients per day. According to a 
DOD official, the CMOP pilot in San Diego will likely continue through 
fiscal year 2004.

Key West, Florida:

Partners: VA Miami Medical Center and Naval Hospital Jacksonville:

VA and the Navy have shared space and services since 1987. The Key West 
Clinic became a joint venture location in 2000. VA physically occupies 
10 percent of the Navy clinic in Key West. The clinic is a primary care 
facility. However, the clinic provides psychiatry, internal medicine, 
and part-time physical therapy. According to Navy officials, there are 
two VA physicians on call at the clinic and seven Navy physicians. The 
Navy's physicians examine VA patients when needed, and the Navy bills 
the VA at 90 percent of CMAC. Further, VA reimburses the Navy 10 
percent of the total cost for housekeeping and utilities. VA and the 
Navy share laboratory and pathology, radiology, optometry, and pharmacy 
services. The VA reimburses the Navy $4 for the packaging and 
dispensing of each prescription.

Pensacola, Florida:

Partners: VA Gulf Coast Veterans Health Care System and Naval Hospital 
Pensacola:

Since 2000, the Navy has provided services to VA beneficiaries at its 
hospital through sharing agreements that include emergency room 
services, obstetrics, pharmacy services, inpatient care, urology, and 
diagnostic services. In turn, VA provides mental health and laundry 
services to Navy beneficiaries.

In fiscal year 2002, the Naval Hospital Pensacola met about 88 percent 
of VA's inpatient needs. The Navy provided 163 emergency room visits, 
112 outpatient visits, and 8 surgical procedures for orthopedic 
services to VA beneficiaries. Through this agreement VA has reduced its 
reliance on civilian providers, thus lowering its purchased care cost 
by about $385,000 annually. Further, according to a VA official, the 
agreement has allowed VA to modify its plans to build a new hospital to 
meet increasing veteran demand for health care services. Rather than 
build a new hospital VA intends to build a clinic to meet outpatient 
needs. Using VA's cost per square foot estimates for hospital and 
clinic construction, the agency estimates that it will cost $45 
million[Footnote 22] to build a new clinic compared to $100 million for 
a new hospital.

Honolulu, Hawaii:

Partners: VA Pacific Islands Healthcare System and Tripler Army Medical 
Center:

VA and the Army entered into a joint venture in 1991. According to VA 
and Army officials, over $50 million were saved in construction costs 
when VA built a clinic adjacent to the existing Army hospital. 
According to a VA official, the Army hospital is the primary facility 
for care for most VA and Army beneficiaries. The Army provides VA 
beneficiaries with access to the following services: inpatient care, 
intensive care, emergency room, chemotherapy, radiology, laboratory, 
dental, education and training for physicians, and nurses. Also, as 
part of the joint venture agreement, VA physicians are assigned to the 
Army hospital to provide care to VA patients. VA and the Army provided 
services to about 18,000 VA beneficiaries in 2003.

According to an Army official, the joint venture as a whole provides no 
savings to the Army. The benefit to the Army is assured access for its 
providers to clinical cases necessary for maintenance of clinical 
skills and Graduate Medical Education through the reimbursed workload.

North Chicago, Illinois:

Partners: North Chicago VA Medical Center and Naval Hospital Great 
Lakes:

VA provides inpatient psychiatry and intensive care, and outpatient 
clinic visits, for example, pulmonary care, neurology, gastrointestinal 
care, diabetic care, occupational and physical therapy, speech therapy, 
rehabilitation, and diagnostic tests to Navy beneficiaries. VA also 
provides medical training to Naval corpsmen, nursing staff, and dental 
residents. The Navy provides selected surgical services for VA 
beneficiaries such as joint replacement surgeries and cataract 
surgeries. In addition, as available, the Navy provides selected 
outpatient services, mammograms, magnetic resonance imaging (MRI) 
examinations, and laboratory tests. The 2-year cost under this 
agreement from October 2001 through September 2003 is about $295,000 
for VA and about $502,000 for the Navy. According to VA officials, VA 
and DOD pay each other 90 percent of the CMAC rate for these services. 
As a result, for the 2-year period VA and DOD reduced their costs by 
about $88,000 through this agreement, as opposed to contracting with 
the private sector for these services. VA officials also stated that 
other benefits were derived from these agreements, including sharing of 
pastoral care, pharmacy support, educational and training 
opportunities, imaging, and the collaboration of contracting and 
acquisition opportunities, all resulting in additional services being 
provided to patients at an overall reduced cost, plus more timely and 
convenient care.

According to VA, in October 2003 the Navy transferred its acute 
inpatient mental health program to North Chicago VA medical center, 
where staff operate a 10-bed acute mental health ward, which has 
resulted in an estimated cost reduction of $323,000. This unit also 
included a 10-bed medical hold unit.

Further, VA and the Navy are pursuing a joint venture opportunity 
planned for award in fiscal year 2004, which will integrate the medical 
and surgical inpatient programs. This will result in the construction 
of four new operating rooms and the integration of the acute outpatient 
evaluation units at VA. The Navy would continue to provide surgical 
procedures and related inpatient follow-up care for Navy patients at 
the VA facility. The joint venture would eliminate the need for the 
Navy to construct replacement inpatient beds as part of the Navy's 
planned Great Lakes Naval hospital replacement facility. According to 
VA, this joint venture would result in an estimated cost reduction of 
about $4 million.

Louisville, Kentucky:

Partners: VA Medical Center Louisville and Ireland Army Community 
Hospital, Ft. Knox:

Since 1996, in Louisville, Kentucky, VA and the Army have been engaged 
in sharing activities to provide services to beneficiaries that include 
primary care, acute care pharmacy, ambulatory, blood bank, intensive 
care, pathology and laboratory, audiology, podiatry, urology, internal 
medicine, and ophthalmology. For fiscal year 2003, a local VA official 
estimated that VA reduced its cost by $1.7 million as compared to 
acquiring the same services in the private sector through its 
agreements with the Army; he also estimated that the Army reduced its 
cost by about $1.25 million as compared to acquiring the same services 
in the private sector. As an example of the site's efforts to improve 
access to care, in 2003 VA and DOD jointly leased an MRI unit. The unit 
eliminates the need for beneficiaries to travel to more distant sources 
of care. A Louisville VA official stated that the purchase reduced the 
cost by 20 percent as compared to acquiring the same services in the 
private sector.

Las Vegas, Nevada:

Partners: VA Southern Nevada Healthcare System and 99th Medical Group, 
Nellis Air Force Base:

In this joint venture, VA and the Air Force operate an integrated 
medical hospital. Prior to 1994, VA had no inpatient capabilities in 
Las Vegas. This required VA beneficiaries to travel to VA facilities in 
Southern California for their inpatient care. This joint venture also 
improved access to specialized providers for DOD beneficiaries. The 
following services are available at the joint venture: anesthesia, 
facility and acute care pharmacy, blood bank, general surgery, mental 
health, intensive care, mammography, obstetrics and gynecology, 
orthopedics, pathology and laboratory, vascular surgery, plastic 
surgery, cardiology, pulmonary, psychiatry, ophthalmology, urology, 
podiatry, computed tomography scan, MRI, nuclear medicine, emergency 
medicine and emergency room, and pulmonary and respiratory therapy. VA 
and Air Force officials estimate that the joint venture reduces their 
cost of health care delivery by over $15 million annually.[Footnote 23] 
Currently, the site is in the process of enlarging the hospital's 
emergency room.

According to a VA official, during periods of heightened security, 
veterans seeking treatment from the hospital at Nellis Air Force base 
in Las Vegas must park outside the base perimeter, undergo a security 
screening, and wait for shuttle services to take them to the hospital 
for care.

Albuquerque, New Mexico:

Partners: New Mexico VA Health Care System and 377th Medical Group, 
Kirtland Air Force Base:

According to VA and Air Force officials, Albuquerque is the only joint 
venture site where VA provides the majority of health care to Air Force 
beneficiaries. The Air Force purchases all inpatient clinical care 
services from the VA. The Air Force also operates a facility, including 
a dental clinic adjacent to the hospital. According to an Air Force 
official, for fiscal year 2003 the Air Force avoided costs of about 
$1,278,000 for inpatient, outpatient, and ambulatory services needs. It 
also avoided costs of about $288,000 for emergency room and ancillary 
services. The Air Force official estimates that under the joint venture 
it has saved about 25 percent of what it would have paid in the private 
sector. Further, according to the Air Force official, additional 
benefits are derived from the joint venture that are important to 
beneficiaries such as: 1) continuity of care, 2) rapid turnaround 
through the referral process, 3) easier access to specialty providers, 
and 4) an overall increase in patient satisfaction.

Additionally, both facilities individually provide women's health 
(primary care, surgical, obstetrics and gynecology) to their 
beneficiaries. The Air Force official reported in March 2004 that they 
were evaluating how they can jointly provide these services. In fiscal 
year 2003 Kirkland Air Force Base was selected as a pilot location for 
the CMOP program. According to a DOD official, the CMOP pilot at 
Kirtland Air Force Base will likely continue through fiscal year 2004.

Fayetteville, North Carolina:

Partners: Fayetteville VA Medical Center and Womack Army Medical 
Center, Fort Bragg:

According to a VA official, VA and Army shared resources include blood 
services, general surgery, pathology, urology, the sharing of one 
nuclear medicine physician, one psychiatrist, a dental residency 
program, and limited use by VA of an Army MRI unit.

Charleston, South Carolina:

Partners: Ralph H. Johnson VA Medical Center and Naval Hospital 
Charleston:

According to Navy officials, with the downsizing of the Naval Hospital 
Charleston and transfer of its inpatient workload to Trident Health 
Care system (a private health care system), VA and the Navy no longer 
share inpatient services, except in cases where the Navy requires 
mental health inpatient services. However, in June 2004, VA has 
approved a minor construction joint outpatient project totaling $4.9 
million (scheduled for funding in fiscal year 2006 with activation 
planned for fiscal year 2008). Design meetings are underway. Among the 
significant sharing opportunities for this new facility are laboratory, 
radiology, and specialty services.

El Paso, Texas:

Partners: El Paso VA Health Care System and William Beaumont Army 
Medical Center, Fort Bliss:

In this joint venture, the VA contracts for emergency department 
services, specialty services consultation, inpatient services for 
medicine, surgery, psychiatric, and intensive care unit from the Army. 
The Army contracts for backup services from the VA including 
computerized tomography, and operating suite access. According to VA 
officials, the Army provides all general and vascular surgery services 
so that no veteran has to leave El Paso for these services. This 
eliminates the need for El Paso's veterans to travel over 500 miles 
round-trip to obtain these surgical procedures from the Albuquerque 
VAMC--the veterans' closest source of VA medical care. The Army 
provides these services at 90 percent of the CMAC rate or in some cases 
at an even lower rate.

According to a VA official in June 2004, VA and the Army have agreed to 
proceed with a VA lease of the 7th floor of the William Beaumont Army 
Medical Center. VA would use the space to operate an inpatient 
psychiatry ward and a medical surgery ward. VA will staff both wards.

In fiscal year 2004 El Paso was approved as a pilot location for 
testing a system that stores VA and DOD patient laboratory results 
electronically.

San Antonio, Texas:

Partners: South Texas Veterans Health Care System; Wilford Hall Medical 
Center, Lackland Air Force Base; and Brooke Army Medical Center, Fort 
Sam Houston:

As of March 2004, a VA official stated that VA and DOD have over 20 
active agreements in place in San Antonio. Some of the sharing 
activities between VA and the Air Force include radiology, maternity, 
laboratory, general surgery, and a blood bank. Since 2001, VA staffs 
the blood bank and the Air Force provides the space and equipment--the 
blood bank provides services to VA and Air Force beneficiaries. 
According to VA, the blood bank agreement saves VA and DOD about 
$400,000 per year.

Further, according to Air Force officials, as of June 2004 VA and the 
Air Force were negotiating to jointly operate the Air Force's ICU. The 
Air Force would supply the acute beds and VA would provide the staff. 
This joint unit would provide services to both beneficiary populations.

In addition, VA and Army agreements include the following areas of 
service: gynecology, sleep laboratory, radiology, and laundry. 
According to VA officials, VA entered into a laundry service agreement 
with Brooke Army Medical Center in 2002 to utilize some of VA's excess 
laundry capacity. Under the contract VA processes about 1.7 million 
pounds of laundry each year for the Army at an annual cost of $875,000.

Puget Sound, Washington:

Partners: VA Puget Sound Health Care System and Madigan Army Medical 
Center, Ft. Lewis:

As of June 2004, VA and the Army have two sharing agreements in place 
that encompass several shared services. For example, the Army provides 
VA beneficiaries with emergency room, inpatient, mammography, and 
cardiac services. The VA provides the Army with computer training 
services, laboratory testing, and radiology and gastrointestinal 
physician services on-site at Madigan. In addition, VA nursing and 
midlevel staff provide support to the Army inpatient medicine service. 
In turn, the Army provides 15 inpatient medicine beds for veterans.

During fiscal year 2002, VA paid the Army $900 per ward day per patient 
for inpatient care and $1,720 per ICU day. During fiscal year 2002, 
there were 69 VA patients discharged, with 117 ward days and 101 ICU 
days, averaging $1,280 per day. According to VA officials, this 
agreement resulted in a cost reduction, in that to contract with 
private providers the average cost per day would have been $1,939. The 
cost reduction to VA was $143,752. The VA and Army jointly staff 
clinics for otolaryngology (1/2 day per week) and ophthalmology (3 
half-day clinics per month). This agreement results in a cost reduction 
of about $25,000 per year to VA compared to contracting with the 
private sector. Other services such as mammography do not result in a 
cost reduction, but according to VA officials they provide their 
beneficiaries with another source for accessing care.

[End of section]

Appendix III: Comments from the Department of Veterans Affairs and the 
Department of Defense:

THE SECRETARY OF VETERANS AFFAIRS: 
WASHINGTON: 

July 14, 2004:

Ms. Cynthia A. Bascetta: 
Director:
Health Care Team:
U. S. General Accounting Office: 
441 G Street, NW:
Washington, DC 20548:

Dear Ms. Bascetta:

The Department of Veterans Affairs (VA) has reviewed the General 
Accounting Office's (GAO) draft report, VA and DOD HEALTH CARE: 
Resource Sharing at Selected Sites, (GAO-04-792). The report found that 
VA and Department of Defense (DoD) realized benefits from sharing 
activities at all of the 16 sites reviewed, resulting in better 
facility utilization, greater access to care, and reduced federal 
costs. VA agrees with GAO's findings. We have provided technical edits 
and updated comments on the resource sharing activities at the selected 
sites separately.

The report notes concerns at the majority of the sites reviewed 
regarding the inability of VA's and DOD's computer systems to 
communicate and conduct a two-way transfer of health information. VA, 
in cooperation with DoD, is 
developing an electronic interface that will support a bi-directional 
sharing of health data. This approach is set forth in the Joint VA/DoD 
electronic Health Records plan "HealthePeople (Federal), and was 
approved by the Office of Management and Budget (OMB) in April 2003. 
The plan provides for a documented strategy for the Departments to 
achieve interoperable health systems in 2005. It includes the 
development of a health information infrastructure and architecture, 
supported by common data, communications, security, software standards 
and high-performance health information. VA believes these actions will 
achieve the two-way transfer of health information and communication 
between VA's and DoD'S information systems.

VA and DoD are actively engaged in several activities relating to the 
development of the final architecture for the electronic interface 
between the agencies' health information systems. The Departments 
expect to complete the final architecture by 1STQuarter, FY 2005. 
Initiatives included in this architecture are:

* Joint Electronic Health Records - This initiative will allow health 
care providers in both Departments access to relevant medical 
information.

* Composite Health Care Systems/Veterans Information Systems and 
Technology Architecture (CHCA/VistA) Data Sharing Interface (DSI) -This 
initiative allows for real time, bi-directional exchange of limited 
data for shared patients. For example, DSI will permit a military 
treatment facility to share clinical data, capable of computational 
actions, with any VA medical center when a patient presents for care.

VA/DoD Clinical Data Repository-This initiative will develop an 
interface between VA's and DoD's health care data that will support 
real time bi-directional exchange of health data.

* VA/DoD Joint Electronic Medical Records (JEMR) -This comprehensive 
and coordinated electronic interface project management plan updates 
previous versions and is currently being reviewed by the Departments.

* Security Policy-Once the final technical architecture is identified, 
a security polity will be completed.

Thank you for the opportunity to review your draft report. Sincerely 
yours,

Sincerely yours,

Signed by: 

Anthony J. Principi:

THE ASSISTANT SECRETARY OF DEFENSE:

WASHINGTON, D. C. 20301-1200:

HEALTH AFFAIRS:

JUL 07 2004:

Ms. Cynthia A. Bascetta: 
Director, Health Care-Veterans' Health and Benefits Issues:
U.S. General Accounting Office: 
441 G Street, N.W.: 
Washington, DC 20548:

Dear Ms. Bascetta:

This is the Department of Defense (DoD) response to the General 
Accounting Office (GAO) draft report GAO-04-792, "VA AND DOD 
HEALTHCARE: Resource Sharing at Selected Sites," dated June 23, 2004 
(GAO Code 290301/GAO-04-792).

The Department appreciates the opportunity to comment on the draft 
report and generally concurs with the GAO findings. The Department's 
response to the identified GAO issues is enclosed, along with overall 
comments and specific technical corrections for incorporation into the 
final report. Comments were requested from the Services' Surgeons 
General. However, due to the limited review time, only Army comments 
have been received. Army technical comments have been included as part 
of our response. A copy of the Army comments is enclosed.

Please direct any questions to my points of contact on this matter, Mr. 
Kenneth Cox (functional) at (703) 681-0039, ext. 3602 and Mr. Gunther 
J. Zimmerman (Audit Liaison) at (703) 681-3492, ext. 4065.

Sincerely,

Signed for: 

William Winkenwerder, Jr., MD:

Enclosures:

1. Overall Comments:

2. Technical Comments:

3. Additional Comments:

Enclosure 1:

GAO DRAFT REPORT - DATED 23 JUNE 2004 (GAO CODE-290301/GAO-04-792):

"VA AND DOD HEALTH CARE: RESOURCE SHARING AT SELECTED SITES":

DEPARTMENT OF DEFENSE COMMENTS:

The draft report provides a review of the Department's resource sharing 
projects with the Department of Veterans' Affairs. The Department's 
comments on the GAO issues identified in the draft report follow:

Overall Comments:

The Department of Defense appreciates the GAO's review and assessment 
of the resource sharing activities and agreements in existence at the 
16 identified sites, and believes that local health care demand 
differences as well as available assets account for most of the 
differences in the level of sharing occurring between the sharing 
partners.

* The Department of Defense acknowledges the findings of GAO regarding 
the increased time it takes for veterans to gain entry to military 
treatment facilities located on Air Force, Army, and Navy installations 
during periods of heightened security. While we work diligently to 
solve this problem, increased security has become a fact of life that 
is not likely to see early resolution.

Comment on p.10-11 (last paragraph)--DoD and VA continue to play key 
roles as lead partners in the Consolidated Health Informatics (CHI) 
project, one of the 24 eGov initiatives in support of the President's 
Management Initiative. CHI's goal is to establish federal health 
information interoperability standards as the basis for electronic 
health data transfer in all activities and projects among all agencies 
and departments. In March 2003, the CHI project announced the first set 
of standards to be adopted. They include four messaging and one 
vocabulary standard. In May 2004, 7 additional CHI standards were 
adopted. These standards apply to 20 of the 24 domains examined by CHI.

* Comment on P.13 (1st paragraph)-DoD and VA have implemented a joint 
project management structure for the DoD/VA Information Management/
Information Technology initiatives that include oversight by the VA/DoD 
Health Executive Council and the VA/DoD Joint Executive Council, as 
needed. The Departments have 
effectively and consistently used this structure. The VA/DoD joint 
project management structure includes a single Program Manager and a 
single Deputy Program Manager with joint accountability and day-to-day 
responsibility for project implementation. They work with in the 
governance structure described above and follow sound project 
management and software development methodologies expressed by the 
Project Management Institute and federal guidelines. 

[End of section]

Related GAO Products:

Computer-Based Patient Records: VA and DOD Efforts to Exchange Health 
Data Could Benefit from Improved Planning and Project Management. GAO-
04-687. Washington, D.C.: June 7, 2004.

Computer-Based Patient Records: Improved Planning and Project 
Management Are Critical to Achieving Two-Way VA-DOD Health Data 
Exchange. GAO-04-811T. Washington, D.C.: May 19, 2004.

Computer-Based Patient Records: Sound Planning and Project Management 
Are Needed to Achieve a Two-Way Exchange of VA and DOD Health Data. 
GAO-04-402T. Washington, D.C.: March 17, 2004.

DOD and VA Health Care: Incentives Program for Sharing Resources. GAO-
04-495R. Washington, D.C.: February 27, 2004.

Veterans Affairs: Post-hearing Questions Regarding the Departments of 
Defense and Veterans Affairs Providing Seamless Health Care Coverage to 
Transitioning Veterans. GAO-04-294R. Washington, D.C.: November 25, 
2003.

Computer-Based Patient Records: Short-Term Progress Made, but Much Work 
Remains to Achieve a Two-Way Data Exchange Between VA and DOD Health 
Systems. GAO-04-271T. Washington, D.C.: November 19, 2003.

DOD and VA Health Care: Access for Dual Eligible Beneficiaries. GAO-03-
904R. Washington, D.C.: June 13, 2003.

VA and Defense Health Care: Increased Risk of Medication Errors for 
Shared Patients. GAO-02-1017. Washington, D.C.: September 27, 2002.

VA and Defense Health Care: Potential Exists for Savings through Joint 
Purchasing of Medical and Surgical Supplies. GAO-02-872T. Washington, 
D.C.: June 26, 2002.

DOD and VA Pharmacy: Progress and Remaining Challenges in Jointly 
Buying and Mailing Out Drugs. GAO-01-588. Washington, D.C.: May 25, 
2001.

Computer-Based Patient Records: Better Planning and Oversight By VA, 
DOD, and IHS Would Enhance Health Data Sharing. GAO-01-459. Washington, 
D.C.: April 30, 2001.

VA and Defense Health Care: Evolving Health Care Systems Require 
Rethinking of Resource Sharing Strategies. GAO/HEHS-00-52. Washington, 
D.C.: May 17, 2000.

VA and Defense Health Care: Rethinking of Resource Sharing Strategies 
is Needed. GAO/T-HEHS-00-117. Washington, D.C.: May 17, 2000.

VA/DOD Health Care: Further Opportunities to Increase the Sharing of 
Medical Resources. GAO/HRD-88-51. Washington D.C.: March 1, 1988.

Legislation Needed to Encourage Better Use of Federal Medical Resources 
and Remove Obstacles To Interagency Sharing. HRD-78-54. Washington 
D.C.: June 14, 1978.

FOOTNOTES

[1] Pub. L. No. 97-174, 96 Stat. 70.

[2] The Department of Veterans Affairs was established on March 15, 
1989, succeeding the Veterans Administration.

[3] Bob Stump National Defense Authorization Act for Fiscal Year 2003, 
Pub. L. No. 107-314, Sections 721, 722, 116 Stat. 2589-98 (2002). 

[4] The nine sites in the report were: Los Angeles, California; San 
Diego, California; North Chicago, Illinois; Fayetteville, North 
Carolina; Albuquerque, New Mexico; Las Vegas, Nevada; Charleston, South 
Carolina; El Paso, Texas; and San Antonio, Texas.

[5] Department of Veterans Affairs and Department of Defense Health 
Resources Sharing: Staff Report to the Committee on Veterans' Affairs, 
U.S. House of Representatives 107th Congress, February 25, 2002, 
Washington, D.C. 

[6] The seven sharing sites are Anchorage, Alaska; Fairfield, 
California; Key West, Florida; Pensacola, Florida; Honolulu, Hawaii; 
Louisville, Kentucky; and Puget Sound, Washington.

[7] On May 7, 2004, the Secretary of Veterans Affairs announced that a 
new VA medical center would be opened in Las Vegas, NV. According to 
the Secretary, VA will continue its sharing activities with DOD in Las 
Vegas, NV.

[8] Authorization for the construction of the clinic was given in Pub. 
L. No. 108-170, Section 211, 117 Stat. 2042, 2048. The statute provides 
that funding for the construction must come either from funds 
appropriated for 2004, or funds appropriated before 2004 for 
construction and major projects that are still available. Pub. L. No. 
108-170, §214, 117 Stat. 2049. 

[9] See U.S. General Accounting Office, VA and Defense Health Care: 
Increased Risk of Medication Errors for Shared Patients, GAO-02-1017 
(Washington, D.C.: Sept. 27, 2002).

[10] See U.S. General Accounting Office, Computer-Based Patient 
Records: Improved Planning and Project Management Are Critical to 
Achieving Two-Way VA-DOD Health Data Exchange, GAO-04-811T (Washington, 
D.C.: May 19, 2004). 

[11] VA's remote data views allow authorized users to access patient 
health care data from any VA medical facility.

[12] Discharge summaries include inpatient histories, diagnoses, and 
procedures.

[13] See U.S. General Accounting Office, Computer-Based Patient 
Records: Short-Term Progress Made, but Much Work Remains to Achieve a 
Two-Way Data Exchange Between VA and DOD Health Systems, GAO-04-271T 
(Washington, D.C.: Nov. 19, 2003).

[14] See GAO-04-811T.

[15] See U.S. General Accounting Office, Computer-Based Patient 
Records: Sound Planning and Project Management Are Needed to Achieve a 
Two-Way Exchange of VA and DOD Health Data, GAO-04-402T (Washington, 
D.C.: Mar. 17, 2004) and U.S. General Accounting Office, Computer-Based 
Patient Records: VA and DOD Efforts to Exchange Health Data Could 
Benefit from Improved Planning and Project Management, GAO-04-687 
(Washington, D.C. : June 7, 2004).

[16] The nine sites in the report were: Los Angeles, California; San 
Diego, California; North Chicago, Illinois; Fayetteville, North 
Carolina; Albuquerque, New Mexico; Las Vegas, Nevada; Charleston, South 
Carolina; El Paso, Texas; and San Antonio, Texas.

[17] Department of Veterans Affairs and Department of Defense Health 
Resources Sharing: Staff Report to the Committee on Veterans' Affairs, 
U.S. House of Representatives 107th Congress, (Washington, D.C .: Feb. 
25, 2002). 

[18] The seven sharing sites are Anchorage, Alaska; Fairfield, 
California; Key West, Florida; Pensacola, Florida; Honolulu, Hawaii; 
Louisville, Kentucky; and Puget Sound, Washington.

[19] See Related GAO Products.

[20] To reimburse civilian physicians, DOD has established a fee 
schedule--the Civilian Health and Medical Program of the Uniformed 
Services (CHAMPUS) maximum allowable charge (CMAC) rates--which is the 
highest amount DOD will pay civilian network physicians for providing 
medical services to DOD patients.

[21] VA and DOD are conducting a pilot test to provide DOD 
beneficiaries with a mail-order pharmacy benefit. Under the pilot, VA's 
CMOP program located in Leavenworth, Kansas will refill prescription 
medications on an outpatient basis for DOD beneficiaries who had their 
original prescriptions filled at the Darnall Army Community Hospital, 
Fort Hood, Texas; the Naval Medical Center, San Diego, California; or 
the 377th Medical Group, Kirtland Air Force Base, New Mexico.

[22] Authorization for the construction of the clinic was given in Pub. 
L. No. 108-170, Section 211, 117 Stat. 2042, 2048. The statute provides 
that funding for the construction must come either from funds 
appropriated for 2004, or funds appropriated before 2004 for 
construction and major projects that are still available. Pub. L. No. 
108-170, §214, 117 Stat. 2049. 

[23] On May 7, 2004, the Secretary of Veterans Affairs announced that a 
new VA medical center would be opened in Las Vegas, NV. According to 
the Secretary, VA will continue to its sharing activities with DOD in 
Las Vegas, NV.

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