The unified Defense Health Program filed its last budget in FY2026. Two new accounts replace it. The mandatory injection concentrated in a single infrastructure line funds the next decade of military medicine outside the standard appropriations process.
Tuesday covered the VA and HHS. Today is the DOD.
The Defense Health Program, the single appropriation account funding military medicine, does not exist in the FY2027 budget request. The O-1 exhibit posted April 3 at comptroller.war.gov shows two accounts in its place.
0130D: Combat and Operational Medicine Program. $20.342 billion. 0146D: Private Sector Care Program. $22.175 billion.
That is $42.517 billion in discretionary military health spending, compared to $41.775 billion in the unified DHP last year. The net change is 1.8%. The structural reorganization underneath that number redraws the entire market.
What COMP actually funds
COMP funds the direct care system: the 46 military hospitals, the operational medicine pipeline, the research enterprise, and the combat casualty training infrastructure that Via moved immediately to reorganize under the Combat Support Agency framework. PSCP funds the purchased care side: TRICARE managed care contracts, the community network, the civilian providers who see beneficiaries outside the gate. In FY2026, those two missions shared one appropriation and competed for resources within the same budget line. In FY2027, they hold separate accounts, separate budget lines, and separate oversight. A program shift on one side of the ledger no longer automatically affects funding on the other, and the program offices and contractors supporting each side are operating under different resource dynamics for the first time.
The separation is more complete than it appears. In FY2026, account 0130D held everything: direct care, research, and the $20.773 billion purchased care line. PSCP did not exist as a separate account. In FY2027, purchased care was extracted entirely and given its own appropriation for the first time. These are not two accounts that were reorganized. One of them is new.
VADM Via assumed command of DHA on February 2. Four days later, he told the agency it would operate as a Combat Support Agency in full. This is what that directive looks like when it reaches the budget.
The mandatory injection
The $3.139 billion mandatory funding line sits inside COMP under the Base Operations and Communications subaccount. This is not discretionary spending. It was authorized through reconciliation legislation and operates outside the standard defense appropriations process. It does not compete with readiness accounts in the annual budget cycle. It does not require annual reauthorization. And it is concentrated in a single infrastructure line rather than spread across programs.
Base Operations and Communications covers the physical and digital backbone of the direct care system: facility operations, medical information systems, communications infrastructure, and the networks connecting military treatment facilities to each other and to the operational force. The mandatory injection into this subaccount funds the modernization of that backbone over the next decade.
The total COMP request including the mandatory line is $23.481 billion. Strip out the $3.139 billion and the discretionary COMP request is $20.342 billion, a 2.3% decrease from the $20.812 billion in direct care and research funding inside the old unified DHP. The mandatory money is not supplementing the discretionary request. It is replacing part of what would otherwise need to come through annual appropriations, and it is doing so on a timeline and authority that insulates it from the year-to-year budget fights that have delayed military medical infrastructure projects for decades.
For contractors and capture teams, the distinction matters. Programs funded by this mandatory line are not subject to continuing resolution constraints in the same way discretionary programs are. They do not get caught in government shutdown funding gaps. And the procurement authority attached to mandatory spending can move faster than the standard MILCON or IT acquisition process allows under annual appropriations.
The $1.27 billion Congress sets independently every year
The Congressionally Directed Medical Research Programs number is not in this budget request. It never is. CDMRP funding is set by House and Senate appropriators during the markup process, not by the President's budget submission. In FY2026, Congress directed $1.27 billion to CDMRP across more than 30 research programs. The FY2027 number will be set by House appropriators in the defense markup expected in mid-April.
CDMRP pre-announcements for FY2026-funded programs are live now. The Peer Reviewed Medical Research Program, the Congressionally Directed Medical Research Programs' largest single line, has already posted its FY2026 program announcement with submission windows opening. The Tick-Borne Disease Research Program, Lung Cancer Research Program, and Kidney Cancer Research Program have also posted pre-announcements.
If you are building capture pipeline around CDMRP-funded research, track the appropriations markup, not the exhibits. The exhibits show the mechanism. The markup sets the money.
The operational pipeline executing now
The COMP account funds DHA's research and development line at $2.64 billion in the FY2027 request. This covers the operational medicine research enterprise: combat casualty care, military infectious disease, medical simulation and training, and the clinical investigation programs running across military treatment facilities.
The R&D line includes funding for the Combat Casualty Care Research Program, the Military Infectious Diseases Research Program, the Military Operational Medicine Research Program, and the Clinical and Rehabilitative Medicine Research Program. These are the programs that develop and field the medical capabilities the operational force uses. They feed directly into the combat support mission Via is reorganizing DHA around.
The Uniformed Services University of the Health Sciences request is $818 million, up 3.1% from FY2026. USU trains the military medical officer pipeline and runs the research programs that bridge clinical practice and operational medicine. The increase is modest but consistent with the Combat Support Agency direction: you do not cut the institution that produces your military medical workforce while reorganizing around a warfighting medical mission.
Medical MILCON: the geographic shift
The FY2027 military construction request for medical facilities is $1.2 billion across 11 projects. The geographic distribution tells you where the department is investing in permanent medical infrastructure.
Five projects are in the Indo-Pacific region or directly support Pacific-oriented force posture. This is consistent with the National Defense Strategy's Pacific priority and with the broader MILCON pattern across the services. Medical MILCON follows the force, and the force is repositioning toward the Pacific.
The largest single project is the replacement hospital at Naval Medical Center Camp Pendleton at $545 million. This project has been in the pipeline for years, survived multiple budget cycles, and is now funded for construction. Camp Pendleton is a West Coast power projection platform. Its medical center supports the I Marine Expeditionary Force and serves as a trauma and surgical training site for deploying medical units.
The remaining projects include ambulatory care center expansions, dental clinic replacements, and medical logistics facilities at installations spanning Fort Liberty, Joint Base San Antonio, and Ramstein Air Base. The Ramstein project connects to the European medical theater support mission that has been running at increased tempo since 2022.
MHS GENESIS: what March 31 settled
MHS GENESIS completed full deployment to all military treatment facilities on March 31. The system is now the single electronic health record across the Military Health System. There is no legacy system running in parallel. The deployment timeline that started in 2017 is finished.
The FY2027 budget reflects a system in steady-state operations, not deployment. The MHS GENESIS line funds sustainment, optimization, and the interoperability layers connecting the military health record to the VA's health record and to the civilian provider networks accessed through TRICARE.
The interoperability mission is where the budget activity is now. The joint health information exchange connecting DOD and VA records, the Federal Electronic Health Record Modernization office coordinating cross-department standards, and the health data exchange infrastructure linking military treatment facilities to community providers through PSCP-funded networks all depend on MHS GENESIS as the DOD-side endpoint.
The deployment is done. The integration work is not. And the integration work is where the contract activity will be for the next several years.
Three dates before the next issue
House defense appropriations markup is expected the week of April 14. This is where the CDMRP number gets set and where any congressional adjustments to the COMP/PSCP split will surface.
The Senate Armed Services Committee personnel subcommittee hearing on military health is scheduled for April 17. VADM Via is expected to testify. This will be the first public hearing where the Combat Support Agency reorganization and the account split are examined under oath.
DHA's next quarterly financial report to Congress is due April 30. This report will be the first filed under the new two-account structure and will establish the baseline reporting format for the COMP/PSCP split going forward.
