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the growing beneficiary population's demand for health care. We are not using our medical treatment facilities to full capacity and the most significant factor limiting full utilization is staffing. Consequently, when a patient's

need cannot be accommodated within the direct care system, we must refer the

patient to the civilian sector under the CHAMPUS program. This alternative is frustrating for our providers, more costly, and generally not as acceptable to our beneficiaries as care in the direct system. Review of CHAMPUS non-availability statements issued by our facilities indicates that in fiscal 1984 Army hospitals accommodated 93.7 percent of our patients. In fiscal 1987 the accommodation rate declined to 92.3 percent.

The practice of peacetime health is medical readiness. On a daily basis our clinicians and technicians per form their "go-to-war" duties. An adjunct to this readiness is the training of AMEDD personnel. Our Graduate Medical Education Programs are nationally recognized as a valuable asset. These programs ensure that there are trained physicians available to treat the medical needs of our patients. This means that infants are delivered by obstetricians and fractures are set by or thopedists. The largest source of physicians entering the Army is from the Health Professions Scholarship Program (HPSP) and the Uniformed Services University of the Health Sciences (USUHS). These physicians are not specialty trained when they enter active duty. While they are under going residency training they are at the same time delivering care to DoD beneficiaries. The Graduate Medical Education environment provides a solid basis to sharpen and challenge the skills of all participants in the training process as well as providing daily experiences that ensure readiness on the battlefield.

Concern for our soldiers and their families is reflected in the Army

Medical Enhancement Program developed over the past several years, endorsed by the Congress, and initially executed last fiscal year. The objective of the medical enhancement program is to improve the accessibility and the quality of care in medical treatment facilities. The first objective is creation of a primary care model for all active duty families. The second objective is to improve the patient appointment system. This includes hiring more clerks and receptionists as well as installing automation to assist in managing the scheduling process while providing excellent data for management. A third objective is to obtain additional ancillary support personnel nurses, physical therapists, occupational therapists, dieticians, corpsmen, lob, pharmacy and radiology technicians. These additional personnel will increase support for physicians in the clinical environment, relieve physicians from per forming nonclinical duties, improve provider productivity and the effectiveness and efficiency of the health care delivery system, and support the Army Family Action Plan through improved access for military family

members to care.

The medical enhancement initiative is a bold program requiring the overall support of the Army Staff to ensure that adequate resources are available to

make it happen. This under taking will provide some 4,000 additional workyears

to support medical activities over the course of the program. A significant philosophy is reflected in the Army decision to support this quality initiative. It is that the soldier who knows that his or her family is well cared for is a soldier more dedicated to fight on the battlefield. Simply stated, health care for the soldier and his family is a readiness issue.

Initial results from our first year of implementation show that the objectives of this enhancement program are being met. Access and service to

our beneficiaries is improving. Reported highlights of the program from individual facilities indicate that additional nursing and other ancillary staff have helped return nurses to patient care, improve intensive care service, reduce surgery backlogs, reduce emergency room waiting times, provide respiratory therapy services, improve nutrition care, reduce pharmacy waits, expand radiology services, meet national accreditation standards, and even establish an open heart surgery program at one location. Continuation of this initiative will help in meeting more of the demand for health care, recapture CHAMPUS workload, and ensure that we provide quality health care.

Opportunities to share health resources and thereby utilize excess capacity in either VA or DoD facilities are being pursued under the framework

of the Health Resources and Sharing Act. VA and DOD cooperative ventures to maximize the use of federal health facilities afford mutually beneficial opportunities to expand service availability while promoting cost containment. Since passage of this law, the Army Medical Department and the VA have successfully negotiated over fifty sharing agreements covering all aspects of hospital services. Examples of services currently shared include inpatient and outpatient care as well as neurosurgery, open heart surgery, specialty consultations and procedures, procurement of medical supplies and equipment, dental services, and CT scans and other radiology services.

Recently, William Beaumont Army Medical Center (KIBAMC) entered into a joint venture with the El Paso, Texas, Veterans' Administration Outpatient Clinic. This agreement currently allots forty inpatient beds at WBAMC for VA use. Future needs may increase this number to 105 beds. The Veterans' Administration is consider ing construction of a new ambulatory care center adjacent to WBAMC which would replace an aging facility in El Paso and

encourage further sharing of services between the facilities.

One of our most successful peacetime health care initiatives of recent

years is the Primary Care for the Uniformed Services program (PRIMUS). It was

developed and implemented by the Army in response to Congressional directives to improve access and convenience for the beneficiary, and to increase workload accomplished in military medical facilities as well as to provide an alternative to CHAMPUS. The concept utilizes contractor operated primary care clinics as satellite facilities to existing military hospitals. The first PRIMUS clinic opened in Fairfax, Virginia, in 1985. The Army currently has four PRIMUS clinics in operation, three in Northern Virginia and one in Savannah, Georgia. Contracts to open six more clinics in 1988 were recently awarded. These new clinics will be located at Ft Bragg, North Carolina; Ft

Benning, Georgia; Ft Hood, Texas; and Ft Ord, California.

PRIMUS program objectives are being met. PRIMUS has proven to be a cost

effective method of increasing direct care capability. The contracts are competitively awarded and keen competition in the ambulatory health care marketplace has helped ensure that PRIMUS costs remained extremely low in compar i son to CHAMPUS. In fact, our most recent contract exper ience demonstrates that, on the average, unit cost in the new clinics will be some twelve per cent lower from that in our initial contracts. Currently, PRIMUS provides primary care at a cost at least sixteen percent less than the government cost of a CHAMPUS outpatient visit. Since these clinics are part

of the direct care system, the beneficiary does not cost share at a PRIMUS

clinic.

The PRIMUS concept has been extremely well received within the Army as

well as by the other Services (NAVCARE and Air Force PRIMUS clinic initiatives). Patients have been pleased and excited with these primary care clinics. We need your support to continue this initiative.

The AMEDD is also involved in a demonstration project in Europe to obtain urgent medical care for soldiers and their families stationed in small communities where 24 hour a day clinic operation is uneconomical in terms of staffing. Under this arrangement, the local clinic operates at full staff during normal duty hours to accommodate the needs of the community while agreements with local German hospitals have been negotiated to provide care to our beneficiaries when the military clinic closed. Reimbursement is made by CHAMPUS without patient co-payment. The project is expected to improve the morale of military families in Europe and ensure that quality health care is available without additional cost to active duty members and their families.

As you know, responsibility for funding CHAMPUS benefit claims was transferred to the Services this year. The AMEDD welcomes this challenge. We fully support the philosophy that the MTF commander should be responsible for the health care services provided to the beneficiaries residing near his

facility. In this regard, we are pleased to learn that, next year, OSD billings for CHAMPUS services will be submitted to the Services on a catchment area basis rather than under the current individual service sponsor method. Likewise, during this transition year, the conservative concern of the Congress as expressed in the appropriations report which "fenced" these funds solely for CHAMPUS costs is understood. However, we are hopeful that the

restrictions on utilization of these medical care funds will be removed in order to permit their application to improve capabilities within the direct care system, such as additional staffing or services. These two changes will

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