Within these medical commands,  the Army and Navy have separate but similarly centralized approaches to  contracting for medical services, including health care professionals. JTF CapMed relies on the Army to award contracts for health care  professionals because it does not have its own contracting authority. A variety of contracting arrangements are available to DOD to contract for  health care professionals. We also found that fixed-price contracts were used for more than 90  percent of direct health care medical service obligations in fiscal year  2011, as shown in table 3. We found that the Army, Navy, Air Force, and JTF CapMed together used  multiple-award contracts for 64 percent of the $1.14 billion in obligations  for contracts for health care professionals in fiscal year 2011. During our review, Navy and Air Force officials completed analyses of  their contracting arrangements which indicated that multiple-award  contracts may result in lower costs when contracting for health care  professionals compared to CSAs. Consolidation of Staffing Requirements Is Limited in the Absence of a DOD- wide Acquisition Strategy

Contracting for health care staffing requirements across the military  departments remains largely fragmented. In 2007, DOD drafted a charter for a Defense Medical Strategic Sourcing  Council. For  example, the departments have made efforts to use multiple-award  contracts to consolidate intraservice staffing requirements, but we  identified several instances where multiple task orders were placed for  the same type of provider in the same area or facility. Almost All Contract Health Care Professionals Work in On-Base Military Treatment Facilities

Nearly all of the military departments’ contract health care professionals— 96 percent—worked in facilities located on military installations in fiscal  year 2011. Further, based on available data  and interviews with DOD officials, we determined that labor categories,  labor costs, and full-time equivalent calculations all vary by military  department, and in some cases by facility or contract. Costs Associated with Contract Health Care Professionals at On-Base Facilities Are Not Comparable to Those at Off-Base Facilities

Based on available data and interviews with DOD officials, we determined  that the costs associated with the provision of care by contract health  care professionals at on-base facilities and off-base facilities were not  directly comparable for a variety of reasons. For example, reported  workload data have been characterized as unreliable. DOD Has Agency- wide Training Requirements for Contracting Personnel, and Health Care Experience Varies

DOD medical services contracting personnel are subject to DOD-wide  training requirements, and health care experience varies for these  personnel. The military departments provide CORs, but usually not  contracting officers, with specialized training in contracting for health care  professionals in addition to DOD’s requirements. The training offered by the Defense Acquisition  University (DAU) provides a foundation for acquisition and career field  knowledge, and is not targeted to specific jobs, including the award and  administration of contracts for health care professionals. The Military Departments’ Existing Policies and Procedures Generally Address Legislated Quality Standards, but DOD Did Not Require Consistency

Section 732 of the NDAA for FY 2007 directed the Secretary of Defense  to require consistent quality standards for contract health care  professionals and the staffing companies that provide them across all of  the military departments’ MTFs. According to DOD officials, DOD did not  require consistent quality standards or take any additional actions in  response to this legislation—such as by establishing a specific policy or  guidance—because officials believed the military departments were  already applying these standards as part of their contracting processes. Without such a strategy, the Military  Health System may be missing opportunities for acquiring professional  medical services in the most cost effective manner. Appendix I: Scope and Methodology

To determine what contracting practices are used by the military  departments to contract for medical services as well as what is known  about the cost effectiveness of these practices, we analyzed fiscal year  2011 data obtained from the Federal Procurement Data System-Next  Generation on medical service contracts to determine the extent to which  the military departments used particular contracting practices as well as  the types and amount of medical services that were purchased. To determine the extent to which the military departments have policies or  procedures that generally address legislated quality standards for  contract health care professionals and the staffing companies that provide  these professionals, we obtained documentation such as federal  regulations, DOD and military department-level policies and procedures,  and military department-wide standardized contracting language, as  provided to us by each of the military departments and JTF CapMed. Appendix II: Interactive Graphic Information for the Location of On-Base MTFs and the Number of FTEs at Each Location

Appendix III: Military Treatment Facilities and Total Contracted Full-Time Equivalents (FTE) by Military Department

	Military department Army

	Military department

	Military department

	Military department

Facility name  Grand Forks Air Force Base  Buckley Air Force Base (off-base primary military treatment facility)   Columbus Air Force Base  Brandon Clinic  (off-base facility associated with MacDill Air Force Base)  Walter Reed National Military Medical Center (Previously the Walter Reed Army  Medical Center and the National Naval Medical Center)
Dumfries TRICARE clinic (off-base clinic associated with Fort Belvoir  Community Hospital, previously Woodbridge Family Health Center)   Fort Belvoir Community Hospital (Previously Dewitt Army Community Hospital)
Fairfax TRICARE clinic (off-base clinic associated with Fort Belvoir Community  Hospital)

Appendix IV: The Joint Commission’s Health Care Staffing Services Standards, 2011

Appendix IV: The Joint Commission’s Health  Care Staffing Services Standards, 2011 1. 4. 8. 5. 2. 4.
Why GAO Did This Study

DOD operates a large and complex health care system that employs more than 150,000 military, civilian, and contract personnel working in military treatment facilities. Each military department operates its own facilities, and contracts separately for health care professionals to supplement care provided within these facilities. In fiscal year 2011, these contracts totaled $1.14 billion.
In the National Defense Authorization Act for Fiscal Year 2012, Congress mandated that GAO review the military departments' acquisition of health care professional services. This report examines (1) the contracting practices used by the departments and their cost effectiveness; (2) the extent to which the departments consolidate health care staffing requirements; (3) the percentage and associated costs of contract health care professionals working at on-base facilities versus offbase; (4) the training requirements for and experience of medical services contracting personnel; and (5) the extent to which the departments' policies address legislated quality standards for contract civilian health care professionals and for staffing companies that provide these professionals. To conduct this review, GAO reviewed military health care policies, analyzed DOD's fiscal year 2011 procurement and staffing data, and interviewed DOD military health system officials.

What GAO Found

The military departments--the Army, Navy, and Air Force--generally use competition and fixed-price contracts when contracting for medical professionals. These practices can provide lower prices or reduced risk for the government. The military departments use a number of contract arrangements, including contracts awarded to multiple health care staffing companies, for health care professionals. Military department analyses indicate that multiple-award contracts result in lower prices compared to other contract arrangements.
The Department of Defense (DOD) does not have a consolidated agency-wide acquisition strategy for medical services. In the absence of such a strategy, contracting for health care professionals is largely fragmented. For example, the military departments had not consolidated their staffing requirements by developing joint contracts beyond a limited number of instances amounting to about 8 percent of the fiscal year 2011 spending on health care professionals. The departments have made efforts to use multiple-award contracts to consolidate intraservice staffing requirements, but GAO identified several instances where multiple task orders were placed for the same type of provider in the same area or facility. A more consolidated strategic sourcing strategy could allow DOD to acquire medical services in a more cost-effective way.
Nearly all of the military departments' 11,253 contract health care professionals--96 percent--worked in 114 on-base military treatment facilities in fiscal year 2011, while the remaining 4 percent worked in 8 off-base clinics. The costs associated with the contracted health care services provided at on-base facilities are not comparable to such costs at off-base facilities for a variety of reasons. For example, some Military Health System cost accounting data have been characterized as unreliable. In addition, according to DOD officials, labor categories, labor costs, and full time equivalent calculations all vary by military department and in some cases by facility, contract, or geographic location, making a cost comparison problematic.
DOD medical services contracting personnel are subject to DOD-wide training requirements. Consistent with DOD-wide training for all its contracting officers, DOD does not require health care contracting officers to have specialized training or experience. The required training provides a foundation for career field knowledge and is not targeted to specific types of acquisitions, including contracts for health care professionals. Health care experience among contracting personnel varied by location. Air Force contracting officers are not typically dedicated to medical services contracting, unlike their counterparts in the Army and Navy. The military departments provide contracting officers' representatives, who provide contract oversight, with specialized training in contracting for health care.
GAO found that each of the departments has policies or procedures in place that generally address most of the legislated quality standards enacted in 2007 for contract health care professionals and the staffing companies that provide them. However, DOD did not require the military departments to use consistent quality standards in response to this legislation because DOD officials believed that the departments were already applying these standards as part of their contracting processes.

What GAO Recommends

GAO recommends that the Secretary of Defense develop a DOD-wide strategic approach to contracting for health care professionals. DOD concurred with the recommendation.