The Defense Department wants to change how it pays for the military health system, splitting the account into two programs to safeguard funds for providing medical care to U.S. service members.
The Pentagon’s fiscal 2027 budget request calls for dividing defense health program funding into two: a Combat Operational and Medical Readiness account, or COMP, and a Private Sector Care Program section, or PSCP.
The COMP budget would pay for healthcare and medical readiness of active duty personnel and support military treatment facilities, while the PSCP would cover Tricare, the department’s private health program and other care that is not offered at military hospitals, according to budget documents.
The new structure would prevent one program’s costs from affecting the other, ensuring that “essential battlefield medicine and medical force generation is managed alongside other warfighting capabilities,” the budget documents state.
“By splitting out the cost of private sector care into its own account, the department is enhancing transparency and accountability, making it easier to track how resources are balanced between military medical platforms and the care through our civilian partners,” Space Force Lt. Gen. Steven Whitney, director of force structure, resources and assessment for the Joint Staff, said during a Pentagon budget briefing April 21.
The Defense Department initiated significant reforms of the military health system starting in 2017 as part of an effort to eliminate redundancy and duplication across the military health system.
The changes gave administrative oversight of military hospitals and clinics to the Defense Health Agency and were meant to align medical manpower to focus on active duty personnel and shed non-military patients to the private sector.
But the reforms have negatively affected the system, resulting in an overall degradation of capability at military hospitals and increased reliance on private sector medical care.
Service leaders said this year that healthcare access is one of the largest obstacles now facing service members and their families. In January, Chief Petty Officer of the Navy John Perryman told an audience at the Surface Navy Association symposium in Arlington, Virginia, that medical care is a top priority.
“I’ve been under the military and medical health system my entire life. The health system I am in today is a shadow of the thing I grew up with as an Air Force dependent,” Perryman said.
The sentiment was reiterated in February during a congressional hearing on military quality of life issues.
“What we’ve all seen over the length of our careers is a gradual erosion in the availability of that healthcare for our service members and their families,” Chief Master Sergeant of the Air Force David Wolfe said during a hearing in February.
Efforts are now underway to recruit doctors and encourage patients to return to military facilities while managing adequate patient loads to sustain capabilities.
In late 2024, former Deputy Defense Secretary Kathleen Hicks proposed that the system “re-attract” at least 7% of beneficiaries who get their medical care through Tricare, the military’s private health program, to military hospitals and clinics by the end of 2026.
Hicks said certain elements of the DoD’s health system overhaul, which was mandated by Congress in 2017, have left military treatment facilities, or MTFs, “chronically understaffed” and unable to deliver timely care to all patients.
Military medical leadership has not provided an update to the effort, however. In March, retired Army Brig. Gen. Anthony Tata, undersecretary of defense for personnel and readiness, sidestepped a direct question on the senior enlisted personnel’s concerns.
“We know there are a lot of problems out there, but certainly the primary purpose of our Military Health System is to have trained and ready medical personnel for combat operations,” Tata said at the 2026 AMSUS-Society of Federal Health Professionals annual meeting, according to a recording reviewed by Military Times.
The silence has also frustrated members of Congress who have sought answers on the progress. In April, Rep. Chrissy Houlahan of Pennsylvania, an Air Force veteran and ranking Democrat on the House Armed Services personnel subcommittee, called for increased oversight after Pentagon medical leaders abruptly cancelled an appearance at a hearing on the military health system on March 25.
In a letter to Subcommittee Chairman Rep. Pat Fallon, R-Texas, Houlahan noted that an oversight hearing has not taken place in years.
“Despite many successes, the consolidation of authority in the DHA has been marked by infighting and dysfunction among the Military Departments and the Office of the Secretary of Defense,” Houlahan wrote. “The Military Health System is understaffed and unable to deliver timely care.”
The Defense Department has requested $45.7 billion for the military health system for fiscal 2027, a 5% increase from the 2026 budget. The request includes $20.3 billion for the COMP account, $22.2 billion for the private care account and $3.2 billion for medical infrastructure.
The department also has requested more than $1 billion for research, development tests and evaluation, down nearly $1.5 billion in fiscal 2026.
Work is underway in Congress on the fiscal 2027 Defense Appropriations Act — the legislation that will fund the department next year. House and Senate Republicans have voiced support for the proposed infusion of $1.5 trillion for the fiscal 2027 defense budget, although Senate Defense Appropriations Committee Chairman Mitch McConnell of Kentucky has questioned using a budget reconciliation strategy to cover $350 billion of the cost.
The House plans to mark up the defense appropriations bill on June 24. The Senate has not announced its schedule for introducing the legislation.
Patricia Kime is a senior writer covering military and veterans health care, medicine and personnel issues.