The problem of cost growth in major weapon system acquisition programs has plagued the Department of Defense for several decades. This report examines the Air Force experience with should-cost reviews--a special form of contract cost analysis intended to identify contractor inefficiencies and lower costs to the government--and options for enhancing the Air Force's capability to conduct such reviews.

Recent bid protests have caused large disruptions in resource and operational planning in the Air Force, even leading to the cancellation of the Combat Search and Rescue helicopter program. Some tactics that the Air Force could use to counter such protests in the future include simplifying and clarifying selection criteria and priorities, explaining how its cost estimates are developed, and involving attorneys in external review of bids.

The U.S. Air Force asked RAND Project AIR FORCE to perform a congressionally required assessment of contractor versus organic management of F-22 air vehicle and F119 engine sustainment to determine the most cost-effective approach. The methodology involved the development of notional government sustainment organizations and a consideration of a variety of factors relevant to such a decision, including the asserted benefits of each approach.

Analysis of findings from case studies and structured interviews focused on determining the potential benefits and challenges of using price-based acquisition for Department of Defense procurement of major military-unique systems. Price-based acquisition (PBA), a major acquisition reform measure being used by the Department of Defense (DoD), is claimed to reduce costs and enhance acquisition efficiency. This study presents findings based on structured interviews and case studies to determine whether the claims are true and what potential benefits PBA may hold for DoD.

The Air Force Medical Service (AFMS) currently runs three in-theater hospitals for severely injured or wounded personnel. Part of the practioners' preparation was treating DoD beneficiaries for a broad range of injuries and illnesses. Opportunities for this preparation are not as numerous "in house" as they once were, and AFMS does not always get proper credit for those gained elsewhere. Proper credit for that work is important for funding.