The Defense Department is reorganizing the military healthcare system around a new unified medical command, senior officials said.

The command would be led by a four-star medical officer given unprecedented authority. He would take charge of medical staffing, training, purchasing, operations and medical readiness for the Army, Navy, Air Force and Marine Corps.

Military leaders in early May were shown three options for a new command structure.

Under the first, which enjoys strong support from the Army and Navy surgeons general, the new medical command would be a major combatant command similar to the U.S. Special Operations Forces Command, and reporting directly to the Secretary of Defense.

A four-star general or admiral would command all medical personnel, equipment and facilities, just as SOCOM controls combined special forces. Medical personnel still would be trained for service-unique missions and in the culture of their parent service. But overall medical training, assignments, procurement and operational support would be centrally controlled. Medical staff would be assigned according to command needs.

Perhaps the most controversial feature of this option, at least as envisioned by the Army, would be absorbing the TRICARE Management Activity, including $11 billion a year in regional support contracts. The contracts run vast networks of civilian healthcare providers and represent 70 percent of dollars spent for care to the military's 9 million beneficiaries.

"It's where the money is. I think that's where the risk is," said Lt. Gen. Kevin C. Kiley, Army surgeon general. He added, "If you're going to hold a unified combatant commander for medical accountable for end-to-end healthcare — from the battlefield to Walter Reed (Army Medical Center) — he shouldn't be beholden to another agency for a significant portion of healthcare purchased, particularly from outside markets."

Kiley and Vice Adm. Donald C. Arthur, the Navy surgeon general, are strong advocates for a unified medical command. Combining three medical commands into one would save $334 million the first year, said Arthur. And that estimate, produced by the Center for Naval Analyses, "is probably low," he said.

A second command option would establish two separate unified medical commands — one to oversee private sector care, which means TRICARE and its contracts. A second, military-led command would oversee all operational medicine.

The third command option is a long shot. It would concentrate responsibility for medical care under only one of the services, to be decided later.

The House Armed Services Committee backs a unified command. Its report on the 2007 defense authorization bill says it would lower costs and streamline care.

Correction: Last week I wrote that both the House and Senate defense authorization bills support extending the military pay chart out to 40 years of service. In fact, the House-passed defense bill does not.