An Analysis of Organizational and Funding Alternatives for the Armed Force Institute of Pathology

The Armed Forces Institute of Pathology (AFIP) provides consulting, research, and education services to a wide range of military and some civilian medical facilities. However, the Defense Health Program must subsidize AFIP's activities with an annual budget of roughly $55 million. As part of its Revolution in Business Affairs, the Department of Defense is striving to increase efficiency by making its various activities as self-sufficient as possible. The CNA Corporation was asked to evaluate whether AFIP has the potential to become a self-sufficient organization. We also looked at a range of alternative organizational structures that might be used to run AFIP and offer some insight into the effectiveness of those structures. We believe that AFIP could exist as a fee-for-service activity, but would require significant organizational restructuring.