0. “Medically Ready Force…Ready Medical Force”
Defense Health Agency Update Bryan T. Wheeler Acting General Counsel, Defense Health Agency September 22, 2015
“Medically Ready Force…Ready Medical Force”

1. DHA at Full Operating Capability
“Medically Ready Force…Ready Medical Force”

2. 2015-2016 Update DHA Structure, support Procurements
Compound Pharmacy Spending Issues

3. Defense Health Agency Leadership Team
Lt Gen Douglas Robb
Director
Mr. Paul Hutter
Acting Deputy Director
CMSgt Edward Vottero
Acting Senior Enlisted Advisor
MG Richard Thomas
Director
Healthcare Operations
RADM Bruce Doll
Director
Research & Development
Mr. David Bowen
Director
Health IT
Brig Gen Robert Miller
Director
Education & Training
RADM Raquel Bono
Director
NCR Medical
Mr. Darrell Landreaux
Acting Director
Business Support
“Medically Ready Force…Ready Medical Force”

5. “Medically Ready Force…Ready Medical Force”
Emerging Issues
“Medically Ready Force…Ready Medical Force”

6. “Medically Ready Force…Ready Medical Force”
DHA Procurements
Authority to address coverage for emerging technologies
DHMSM
T-2017
Other Procurements
“Medically Ready Force…Ready Medical Force”

7. DHMSM

8. Tailored Acquisition
Per the 2 Jan 2014 ADM, the tailored acquisition process is documented in the Acquisition Strategy
Authority to Proceed (ATP) decision points used as acquisition milestones:
RFP ATP, Contract Award ATP, Limited Fielding for Initial Operational Capability (IOC) ATP (4Q 2016), Full Deployment Decision (FDD) ATP
The DHMSM program uses the DoD EHR Senior Stakeholder Group (SSG) and the Functional Advisory Council (FAC) to iteratively inform OSD, DHA, and Service program stakeholders
National Defense Authorization Act (NDAA) for Fiscal Year 2014 mandates deploying EHR solution by 31 Dec 2016
Distribution D: Distribution authorized to the DoD and U.S. DoD contractors only. Other requests for this document shall be referred to DHMSM PMO.

9. Governance Secretary of Defense Secretary of Veterans Affairs
DoD EHR Senior Stakeholder Group (SSG)
DoD/VA Executive Committee
USD(P&R)
USD(AT&L)
ASD(HA) / Service
Military Medical Advisory Committee
(SMMAC)
Director DHA
DHMS PEO
Medical Deputies Action Group (MDAG)
DHMSM
DMIX
IPO
Medical Operations Group (MOG)
Functional Advisory Council (FAC)
= Command relationship
= Functional relationship
Distribution A: Approved for Public Release

10. “I walk slowly, but I never walk backward.”
A Common Goal
2006
AHLTA Fielding Complete
2009
EHR Way Ahead
2010
iEHR
2013
DHMSM Kick-Off
2015
Contract Award
“I walk slowly, but I never walk backward.”
- President Abraham Lincoln

11. DHMSM Road to Full Deployment
Full Deployment / FOC
Illustrative
Not to Scale
Acronyms:
ASD(HA) – Assistant Secretary of Defense for Health Affairs
DT&E – Developmental Test & Evaluation
FDD – Full Deployment Decision
FOC – Full Operational Capability
FOT&E – Follow-on Operational Test & Evaluation, if needed
IOC – Initial Operational Capability
OT&E – Operational Test & Evaluation
SG – Surgeon General
USD(AT&L) – Under Secretary of Defense for Acquisition, Technology, and Logistics
VCD – Verification of Corrected Deficiencies
FOT&E
Full Deployment Decision [USD(AT&L)]
VCD
IOC Decision and Declaration [ASD(HA) & Service SGs]
OT&E
Limited Fielding for IOC Decision [USD(AT&L)]
DT&E
GALs
All IOC Sites
Remainder of Region
Enterprise Deployment to all CONUS and OCONUS sites
Contact Award ATP

12. MHS Approved Requirements Operating Environment
Enterprise EHR
Guiding Principle: A flexible and open, single enterprise solution for
both garrison and operational healthcare.
DHMSM
JOMIS
JROC CDD
Requirements
DHMSM Configured EHR +
Theater Capabilities
EHR
60+
Capabilities + =
Service Specific
MHS Approved Requirements
Logistics C2
Consolidated Data Center
Small & Distributed Form Factor
MED COI Infrastructure
Service Tactical Infrastructure
Competitively acquire, test, deliver and successfully transition to a state-of-the-market EHR
Deployment of the new EHR and follow-on theater capabilities to expeditionary locations
Patch – Immunization/Adaptor break out fix
R2 – Release 2
R3 – Release 3 R4 – Release 4
55 Military Medical Centers
& Inpatient Hospitals
352 Health Clinics
282 Dental Clinics
450+ Forward & Resuscitative Sites
300+ Ships
2 Hospital Ships
6 Theater Hospitals
3 Aeromedical Staging units
Operating Environment
DoD and VA Internal Use Only

13. Collaborative Delivery of a Modernized EHR
To deliver a modernized EHR to the military garrison and operational points of care, and transform how the military health system provides healthcare, the Services, DHA and Acquisition Teams will collaboratively work with the care locations to configure, test, train and deploy the new solution
Conclusion
Acquisition
DHMS
Solution Delivery & Infrastructure
DHA
Site Preparation
Services
Modernized
EHR
Business Processes
& Requirements
Functional Champion
Deploy to
1,200+ Care Locations
& 205,000+ Providers
Across the World

14. EHR Modernization Potholes
Governance
Unstable resources
Unclear Program Scope
Insufficient Change Management
Inadequate Technical Skills
Schedule Driven
Consensus Decision Making
Lack of Communications
Insufficient Training
Underestimating Culture
Leadership Stability
Distribution A: Approved for Public Release

15. T-2017 T-3 Contracts Worth $53B Two Regions Instead of Three
Award expected early CY16

16. Other Procurements

17. Other DHA Procurements
8 expected awards for September
3-4 expected awards for October
1 expected award for November
2 expected awards for December
Those contracts and others with cum. awards of >$30 B over next two years

18. Compound Pharmaceuticals

19. Unsolicited Marketing and Misrepresentation
Scheme:
DHA-PI and its contractors are receiving numerous complaints from beneficiaries regarding “cold calls” and “robo calls”
Typically callers state they represent TRICARE and are offering a new benefit at no cost (usually pain or scar cream) and needs patient’s PII
Compound pharmacies are also using Patient Recruiters (including Active Duty Personnel) that offer gift cards or cash to sign patients up to receive compounds. Marketers reported to receive as much as $5K per beneficiary that they convert to compounds
Websites are targeting TRICARE beneficiaries stating they will be paid anywhere from $200-$350 a month to join a study. There is no study being conducted. It’s a ruse to get beneficiaries to sign up and receive compounds
LES/FOUO

20. No Physician/Patient Relationship
Scheme:
Utilizing select physicians to write scripts without patient interaction
Physicians receive as much as $500 per script
TRICARE experiencing an increase of high volume compound prescribers
Top prescriber generated $102.4M in paid claims (for 15,987 scripts) within last 360 days
Prescriptions written by physicians that are not in the same geographical region of the beneficiary
Providers generally are not submitting healthcare claims—they are being paid by the pharmacies
LES/FOUO

21. Compromised PII and PHI
Scheme:
Personally Identifiable Information/Protected Health Information is compromised
Purchased from co-conspirators at providers office, hospital, clinic, etc.
Acquired from marketing calls; solicitations; website
Information is sold to pharmacy engaged in fraud
Information is used to fabricate prescriptions
LES/FOUO

22. Beneficiary Kickbacks
Scheme:
Beneficiary converts to compound medication in return for cash kickback
Beneficiary may or may not receive the medication
Typically beneficiary converts to multiple compound medications
In some instances immediate family members also convert to compounds to expand the kickback revenue stream
In some instances beneficiaries that are recruiters also convert to compounds to receive kickbacks
No cost share or copayment collected
LES/FOUO

23. Investigative Activities
76 active compound pharmacy/prescriber investigations opened in past 90 days
DCIS is lead agency for the majority of compound pharmacy investigations; DCIS independently pursuing numerous leads
May 1, 2014-May 1, 2015:
$603.4 million paid to top 10 pharmacies – Related to suspect pharmacies under law enforcement review
$349.7 million paid for prescriptions generated by top 10 high volume prescribers
LES/FOUO

24. Investigative Activities (cont.)
DCIS Cyber Crimes Unit engaged in link analysis intelligence gathering concerning top 50 paid pharmacies
DHA-PI routinely sharing data mining reports with DCIS-HQ (high prescribers report, top paid compound pharmacies, etc.)
NCIS gathering intel on Active Duty Patient Recruiter/Patients
Weekly collaboration meetings with PBM, DCIS, and DOJ
DCIS leadership want to be kept apprised of effectiveness of TRICARE controls
LES/FOUO

25. Investigative Activities (cont.)
Common owner(s) of different suspect pharmacies is not unusual
In one ongoing DCIS fraud investigation of a retail pharmacy the pharmacy converted their business model from a retail pharmacy to a compound pharmacy
Health Care Fraud Prevention and Enforcement Action Team (HEAT) initially declined dedicating resources to TRICARE.
Recently one Heat (Strike Force) Prosecutor from DOJ has been assigned to a case. And the Miami HEAT (Strike Force) has agreed to look at five cases.
LES/FOUO

26. CBS News Segments
To view right click 26

27. Limited Controls
ESI-PI notifying select pharmacies that directly soliciting beneficiaries is prohibited by network agreement; requesting pharmacies to acknowledge they will comply – 13 notifications have been mailed so far
Pharmacies requesting to be in network that note they dispense over 5% of compound drugs are generally denied
ESI-PI identifying network retail pharmacies that converted to compounding pharmacies in violation of network agreement; also pharmacies known to enter network as a retail pharmacy that convert to a compounding pharmacy; 34 compound pharmacies terminated from network
LES/FOUO

28. Limited Controls (cont.)
Claims suspensions triggered by DHA-PI administrative review of prescribers prescribing outside the state in which they practice, or after significant law enforcement/DOJ event
Exclusions burdensome to execute; typically requires health care fraud conviction
As of 1 May 2015 TRICARE instituted a preauthorization process, and will deny payment for safety and efficacy concerns
TRICARE does not have a closed compound pharmacy network (similar to specialty pharmacy network)
TRICARE does not use a fee schedule to control costs of compound medications. ESI is now negotiating rates with compounding pharmacies as of 1 May 2015
LES/FOUO

29. Resource Impact Law Enforcement: DHA-PI: LES/FOUO
Health Care Fraud is one of the DCIS Investigative Priorities;
Limited DCIS investigative resources; law enforcement resources not sufficient to address scope of problem
DCIS operates from a finite budget (unlike FBI and HHS-OIG no recoveries go to DCIS from doubles, trebles, fines, and penalties to support future investigative operations)
DHA-PI:
Tremendous increase in Fraudlines (498 in last 90 days)
Active case inventory greatly expanding
LES/FOUO

30. Compound Expenditures 2012-2015
LES/FOUO

31. May Total: $70.67, June Total: $10.231M,
July Total: $11.533M, August Total : $9.01M

33. Data Source: ESI Claims Data

34. Seized from Oldsmar Pharmacy February 2015
LES/FOUO

35. Questions