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Today we take a look at how a major reform to military administration of hospitals, clinics, and health care on bases is in serious danger. We also share stories from business, the military sphere, the veteran sphere, and around the world — three of the stories detail changes in and to the US housing market.

Thanks for reading, and feel free to reach out with thoughts and feedback!

THE BIG STORY

Major Overhaul of Military Medicine in Doubt

Have you ever wondered who runs the medical facilities on military bases? Years ago, each service was responsible for administering its own hospitals and clinics. If you were on an Army base, your clinic and hospital were run by the Army. Navy base, your clinic and hospital were run by the Navy.

That’s the way things were, and the services were fine with it. It might have been expensive, but, it did a sufficient job of ensuring unit deployability by keeping on top of soldier readiness.

For decades, though, reformers were critical of those cost inefficiencies, and redundancy within the system. Between 2010 and 2016, they made a strong case for improvement to care and cost savings through centralized oversight. In 2017, Congress passed an act that directed that all military health services and their medical facilities fall under the Defense Health Agency (DHA). They aimed to transition leadership and authority from military services to the DHA, potentially affecting the jobs of thousands of DoD employees, troops, and contractors, and their families.

The Government Accountability Office (GAO) released a report on Monday, August 21, detailing serious challenges facing these efforts.

The DHA estimates that finishing the reforms will save almost $1.6 billion, according to the GAO report. Using personnel more efficiently is one component of that plan. Another component is a mechanism for establishing regional oversight. Both have changed dramatically since the plan’s inception.

Originally, DHA hoped to divide the US into two regions, east and west, and staff two administrative centers in each region, and run OCONUS medical facilities via two overseas regions, as well. In 2019 that changed.

Now DHA plans to group facilities into 36 markets in the US (the two regions overseas have remained constant), and establish 22 offices to manage them.

The first challenge facing DHA is that its estimates for the number of personnel needed to effectively administer all medical facilities exceeds the number of employees and funding available. It turns out that military services do not want to move troops and personnel under the authority of DHS.

The original argument for DHA taking over military medical facilities was that it would provide cost savings by depending on fewer personnel. Now that those personnel are unavailable, the cost savings are in doubt.

The second challenge relates to the first. In addition to lacking the personnel or funding to achieve these cost savings, and not being able to settle on a way to organize facilities efficiently, DHA has also not established plans to track progress on reform implementation, or benchmarks to ensure that cost savings are actually happening.

In short: DHS’s plan doesn’t look feasible, has been changed from what was approved by Congress in 2017, and has no way of measuring progress.

Health care is a big industry, and getting costlier by the year. It’s also becoming further specialized. There’s no question that decades-old administrative answers to the military’s health care needs were due for a check-up. But the government’s answer — a centralized authority to run the military’s clinics and hospitals — may not be as cost-effective or feasible as imagined. They face a real crisis. It remains to be seen whether they’ll be able to resolve it, and the clock is ticking. The plan is supposed to be complete by 2026.

TOP READS IN MONEY & FINANCE

Bank stocks are not hot right now, as the US navigates inflation, housing stock worries, and uncertainty around commercial real estate.

The trade war with China is heating up over metal — the kind you find in cans that store food. Could lead to the price of canned food increasing by as much as 30%.

If you’ve invested in Nike recently, you may be gritting your teeth — the shoe and apparel company hasn’t had a losing streak as long as their current slump (9 days) since their IPO in 1980.

TOP READS IN THE MILITARY

Things don’t look great for a U.S. soldier who went AWOL to North Korea. Prospects for returning Travis King home are low. Thinking about avoiding UCMJ by defecting to North Korea… think again.

Military contractors Northrop Grumman and Lockheed Martin won $1.5 billion to develop a low-orbit satellite network for the Space Development Agency.

For the first time in nearly seven years, accompanied tours for Air Force personnel to Incirlik, Turkey, might be back on after the security situation improved. Good news for families who like living abroad!

TOP READS FOR VETERANS

Army veteran Julie Trias talks about her time at Airbnb, and how corporate mentors encouraged her to speak up. Now she’s a co-founder and CTO of her own company, Teleskope.

If you’re a veteran living in Springfield, Massachusetts, you might be eligible for grant money to help pay for this summer’s pricey New England utilities. If you aren’t, let your state or municipality know that in Springfield, they’re doing it right!

Tunnel to Towers and other non-profits are working on acquiring property in Florida on which to build 126 units of affordable housing for veterans. The project, called Veterans Village, was paused while local town residents were reassured that it would not negatively affect their community.

TOP READS AROUND THE WORLD

Is the Binance crypto exchange doing business with Russia? Russians say that it is.

Saving up a lot of money to buy a house isn’t the boon it once was. Borrowers with cash on hand used to be able to knock as many as two percentage points off mortgages of more than $750k. No longer!

Speaking of housing — if you’re like me you wonder why more commercial real estate owners don’t convert their increasingly-vacant space to apartments (especially given the housing crunch). This deep dive explains in great detail how and why that isn’t always feasible, and the challenges that exist when it is.

HUMOR

The Onion rarely misses, even after all these years.