I!
                                                                      I
                                                                                         piiill.@iii
                                                                           * 009 !I.


                                           T,OTi7AP@D !IEI,@LT'il     Si"@@'J.

                                       Irv@i.r  J.              I,,@iy
                                I-I,c-a2-th Ser-ti-7,cas and 1.@ i-@t@il li'o,.il.tli
                                U.S, De-pa,,,ti-,i--nt o@'          Ecitic@tt.:icii,   lqel@t'@ire

                           In the value syste-@..-i of the                soci(-t:y we place @i very high
                    priority on health.         In fiscal year 1969, we spent $60.3 billion in
                    pit,-stiit oil health.     This suite rc--,p,.-(-,sciits 6.7 pc-,@,-cc-@nt of our Gross  Natioiiil
                    Ilroduct,    Preliminary estimates for, the                     fiscal   year    run    higher

                    still, in both total and percc,.n.t,).,,e.

                           The Ai-iic3-ican  health  enterprise,  in  @71-i-.1ch  you  and  I  both  T,7orl@,  has

                    had this greatness thrust upon it rather                             i@llo-t of us rc-mcribe@c

                    when     the world of medicine was                        peopl-c@cl        friendly       doctors

                    carrya.ng            black bac@s an,'j r)z),rces in the             of Florence @Ni,-htin-ale
                    offerina    soothing hands and teiltde.-i-- hearts.       Thit was a co-i-nf ortabIE! world. -

                    lie    leave it reluctantly.

                           But  leave   it   we   must.   For   explodin@   technology    and    soar3.no    expect,--

                    tions have made that i-7orld            anachronistic as the doctor's watch-fob in

                    the. Norman Rockwell illustrations.   There is no place in such a world to

                    hide a $60-billion industry.

                           In   short,   health   has   been   thrust   into   the   world   of   political   pro-

                    cess.     It   is   involved   in   the   intense   competition    for    resources--i-,ianpo%@er,

                    money,   and   i-,iaterials---@,ihich   cliar@ictcrizcE,@   that   process.    This    competition

                    is continuous and Unrelenting.   It takes place at all levels of govern-

                    Mc-,nt and in the private sector as well.

                    *Presented to Regional I-ledical-                           Z-Loii  flosp-.tal  and  @ledi.cal
                      Center., San FraicJsco, California, January 26, 1970.


                                                                                                                                                                                                     2

                                                Ilealti@i is in fierce competition with many cl,-@iTTiiilts  for  social.
                                    priority.                 It competes with  edu(-.at-i-on,                                                          the rebuilding of cities,
                                    national  defense,  crime  control,  and  with  scores  of  other   worthy   and
                                    necessary  pursuits.  And  within  the  total  health  share   of   the   total
                                    resources  that  emcrae  frori  this  competition,  we  find  another   level   of
                                    competition  aitic)iig  desirable  endeavors.                                                   Decisions must be made on such
                                    questions        as:        Hoi.7        much         to         pay         for         care?         liow         much         to         stimulate         a-ad
                                    support          research?          I-lo@,7          much          to          build          the           basic           resources           of           manpower
                                    and          facilities?          lio-,7          much           to           organize           these           into           an           effective           system?

                                    lloiq  do  we  build  institutio,,is?

                                                Of         all         the         arenas         in         which         these         political          processes          are          in          con-
                                  .stant  interplay,   the  largest  and  ir@ost  visible  is   the  Federal  government.
                                    The  decisions  made  in  that  arena  exert   a  Tqajor   influence  on  those  made
                                    at         al 1         other         levels,          i.ncluclin-          those          in          the          private          sector.          A          few
                                    figures  will  help   to  indicate  the  nature  and  scope  of   the  Federal  health
                                    investment,   and  thus  why,   although  we  might  wish  it  were  otherwise,   health

                                    is  deeply  involved  in  the  world  of   politics.

                                                                   TABLE 1. Fedei-til Oittleii's fi)@- ille(ii(-al A (-tii-iiic,s (iii Aliltioiis of De)ll@ii-s).*

                                                           Tol..%L FEr)rRAt OU 11,AN'S                                   1960                    1966                      1969                      1970
                                                                                                                          $3,507                  $5,91-7              S  16,3   16              S 18,'-' 7 7
                                             Provision of hospital] & medical services,
                                                total                                                                    2,165                   3,521                     12,518                    13,977
                                                   Direct (benefici@try)                                                 1,702                   2,]   99                  2,896                     2,996
                                                   Indirect (,Nledicare, Nledic@iid etc.)                                  463                   1,122                     9,622                     10,981
                                             Development of I)ealt) resources, total                                     1,016                   1,955                     3.057.                    3,496
                                                   Research                                                                509                   1,167                     1,476                     1  @639
                                                   ,Nlanpo@k,er                                                            2  17                   4   10                    841                        93'-
                                                   Facilities construction                                                 290                        378                    595                        728
                                                   lnipro%,ing organization & delivery                                         -                        -                    14   5                     197
                                             Prevention & control of health problems, total                                326                        451                    74   1                     804

                                 'Source: Spcci@,l An@,T@sis, 19'0 flud2et. prepared b, the Fitirei,u of the El,@d,,@t. l@xect,ti,e OfEcc,)f the P,ei(lent.


                                                                                                  3

                        Chart I shoT7s the- distribution of Fedc?.r@il. finii-ici@-i.1 resources  i.n

                  three broad                                           analysis  by  the   Bureau   of

                  the Budget.  The first of these is the provision of services, both
                  directly to ,,nri.ous oroups of federal. beneficiaries and indirectly

                                                    su(-@h -.is 'leclic,
                  through f                                         arc -Liid @IrL,.cli.caicl. The    second

                  cate-ory is the devel.oT-)@ic-nt of health resources, including Tilalipo@,7er
                  facilities, ir!iprovc.@-i@ients in               ii)cl  delivery  and  the  generation

                  Of rl@,7                                  The  third  catc,-,ory  consists  of  Out--

                  lays for prevention of dise,@se slid  control  of  health  prc-l@)lc--tiis,  including

                  eiivirori,f.@c-nta..I. problc-@.-cc,.

                        In the deca,ule between 19'UO and 11,170 federal c--,@-pc@,i-Lditures for health

                  have grown from 3.5 billion Ciol.lars to Tiore that.-, 1.8 billion.       By  far  the
                  greatest gain. has tal,,eii place in the area of indirect payment of services

                  It should also be noted that the rapid upward trend in federal health-

                  research  investment,  which  had  already  reacli--d  the   500-iTiillion-dol.1-ar
                  level  by  1.960,  continued  throug,i  the  first  half  of  the  decide  ind  has

                  tended to level off since that time.

                        Ilost notable in the context of this discussion is the outlay identi-

                  fied  as  ii-provin-  organization  and  delivery,   which   includes   the   recional
                  medical pro,;ra-Ps,  the  partnership  for  health,   and   certain   programs   of
                  the Office of Econo-,@ii-c Oppo3:tunity and the CliiJ.dren's Bureau.       Total
                  expenditures  for  these  system-bLlildiii@,  I)rograilis  constitute  a  very  small

                  proportion of the federal health investment.
                        Chart 2 indicates the distribution of health dollars across the


                                                                                                                                                                                                               4

                                       major federal agencies.                                        The Department Of ITIC',,Iltll, Fclucation, and INTelfare
                                                     his by far thc@. lar-esc share, but ei.(,ht other agencies spend 1,@iore
                                                                                                   C,                                             L,                          0
                                       than 100 million doll.ars for health, and t@qc) of thcsc--the D@epirtiL,@el,,t
                                       of Defense and the 'Vctp-raiis AO,,-ilinistratio-i--hzive health outlays in
                                       excess of 1 billion dollars.                                                1,7ithin IIE@,! the t@qo largest health expendi-
                                       tures are not in the so-called "health acencies" but in the Social.
                                       Security Ad-7@inistration and the Social and Pe'llabil..itation Service, vThl.cli

                                       administer liedica.re and @ledic--id, respectively.

                                                                             I'ABI-E 2.  F@,dei-eit oittitti..@ ii),. Aieetit-til                                  @llillioll@%

                                                                                                                                                      1968             1969

                                                                             Department Of Flealth, Education, & Welfare                              9,8 1 5     S   1   1,500
                                                                                Health.Services &@ Nleiit@@l Health                                      959           1,109
                                                                                   Administration
                                                                                National Institutes of Health                                         1,285            1,247
                                                                                Consumer Protection & En%@ironnienial                                    151             186
                                                                                   Health Service
                                                                                Social Security Administration                                        5,332            6,222
                                                                                Social &, Rehabilitation Set% ice                                     2,080            2,727
                                                                                Other                                                                       8                 9
                                                                             Department of Defense                                                    1,76  1          1,921
                                                                             Veterans Adii)inistrition                                                1,440            1,550
                                                                             Department of Flousing &, Urban                                             83              142
                                                                                Development
                                                                             Department of A,@rictilttil-c                                               149             1   82
                                                                             Allency for International De%elopnieiit                                     117             179
                                                                             Office of Economic Opportunity                                              1 03            134
                                                                             Nation,t] Aei-onttilics & Space Adniiiiistrition                            103             III
                                                                             Atomic Energ5, Commission                                                   100             too
                                                                             Other                                                                       460             497

                                                                             Total fe(feral outit@@s for health                                  S     14,131     $1   6.31   6

                                                                               'Source: Special                 1970 flt,dpet, Prepared bv thL 13,iie@iLi of the
                                                                             Execuii,e O,,Iicc of (he

                                                    Now the world of politics is a very practical. one, and I believe
                                       that as you think about this $18 bill.ion Federal health investment, you
                                       ought to be a%qare of the over-riding theries of the current Administration.
                                       After al.1, political decision-,-aal,:er&, do have a certain method to their
                                       madness, thouc-,h at times it must be difficult to discern.


                                                                                                           5

                          I thing that @,.,e can see                 bro@icl tlicT,,i(,-s @qnl strategies related

                    to the naticii's                             Nl-',).:,ch  the  new   Administration   is
                    pursu-. nc,.  The n@osl-                        of course, is the control of infla-
                                            L

                    tioli.   This ha.,, been                  as ti-Lc pri-taary target problem, and the
                    strategies for its control set much of the                            within       which

                    Federal action i-7il.1 take pla.ce.

                          I.!ithin  this  frame-,7ork,  the   first   major   tirtifyiii,,   strategy   of   the
                    Administratioia's proteins in the domestic sphere his been called the New

                    Federalism.  Al.tlioti,,Ii  thc-tre  --re  sc)iae  @.7ho  regard  this  -ts  just   mere

                    rhetoric, it represents a very conscious effort to establish a division
                    of labor between lave-Is of government in the solution of public problems.

                          For example, a principal sLib-ther,-,e of the New Federalism invo   es

                    a distinction beti,.,een income transfer and support programs, on the one

                    hand, and service pro-raT-is in the human resources field on the other.
                    Speaking very broadly, the Administration seems to believe that the
                    Federal   government    should    assume    the    basic    responsibility    for    incoiie
                    support.   This   is    exemplified    by    its    radically    new    Family    Assistance
                    Plan proposals to be administered federally.   By contrast it would have
                    programs for the delivery of services the responsibility of State and

                    local government.
                          A second important ele@-.,lent of t]).c line,,,, Federalism involves a form

                    of decentralization.         The 'inresid(?nt's                Training prop    osals repre-

                    sent  a  selective   but   far-reaciiiii(,,,   de,legation of power to State and
                                                                       li

                    local    Governments.    The    delecati.on    is    selective    because    the    programs


                                                                                     6

                will be carc@.E;,@.2,.Ly monitored f or ef f ectiveiicss of perf or!-naiice.

                     A third           of the     Fceicr@.t'lisi,@i effort involves revei-ilic
                sharin@. Pevenue sharinc@ is based on the assumption that the  Fed(-ral
                mechanism for collecting money may be superior, but that  many  of  the

                uses of funds so collected can best be determined and  carried  out  at
                state and local levels. After all, if service programs  are  state  and
                local problems, funds must be provided. This is  no  minor  innovation.
                It has bipartisan support,. It N-7oul-d within several years move $4

                billion of Fc-@de--ral funds to state and local units.

                     A second iaajor theme of the new Administration, beyond  the  concept
                of the New Federal.1s,-.,i, deals i.@itli income strategy. The  proposed  Family
                Assistance Program involves supporting some 23 'Million people as  com-
                pared with about 10 million today because it strikes at the problem of
                the working poor, hitherto a truly forgotten American.  It also envisions
                the future expenditure of an additional 4 billion dollars.
                     Another aspect of the income strategy is an effort  to  move  govern-
                ment programs more toward cash support, with  a  proportional  de-emphasis
                on "in-Icind" programs.  In time, the i.n-kind programs, which would
                include such tlings as Medicaid and reiit supplements as well  as  food
                stamps and the like, would be phased into a total cash support system.
                     Obviousl,7  this constitutes a sort of reliance upon what the

                economist calls the riarket strategy. It rests on  the  principle  that
                people themselves can make the best choice of  their  daily  expenditures.
                This market strategy could apply to a number of existing service


               PI:                         -,'Ii4 ch -I)c!.i.-so,,@,s rc@qLt' Fe era I iyic, omr-,
               support might be       money to buy liead  St@,,rt  or  other  foi-ias  of  day-

               care from the source of their choice in lieu of present arrin@cvients

               for direct Federal institutional support.
                    A third major tl-ic-,o,,e which I to  Licrition  briefly  is  an   effort
               to rationalize tire, Federal. sy,-@t@ni. Our oi-Ti-I field  of  health  offers  as
               graphic an         as  any  of  an  array  of  new  pi-oFrams,  each   generated
               by a  sepal-ate  legislative  act  over  the  past  few  years,  eicl-i  desi@,ned  to
               fulfill a legiti.rii@ite and x,7orthj purpo.Te, but all brought into bein- with-
               out adequate reference to -their cumulative impact and interaction.
               Looltin- outside the ir@iinediate ptirv--,.e.-,@,T of health we quickly find a still
               wider array of programs eich of which should be, but  rarely  is,  seen  in

               relation to the others.

                    Settiii- the same eligibility criteria for welfare  and  food  stamp
               programs is one example of rationalizing pro-r@3iiis--in thin,, instance,
               programs administered by different  executive  departments  and  presided
               over by different legislative  committees.  Other  examples  include  block
               grants to states and consolidation or simplification of the entire
                grantsmanship" process which so many of you know  so  much  better  than

               even I.
                    Finally, in listing the broad themes discernible in the  procr@ini  of
               the new Adirii:nistration, I want to mention the. PTapliisis on what the
               President has called "tl-ie quality of li.fe"--the matter of our  physica

               environment.  It is clear that a better c-,ivi.rotimeiit ranls very high on


                  the priority         and I thin!-, we call aiitic2ipr.,.I--e inijor attacks oii

                  pollution in its many forms in tiie Tiioi7Ltlis aleaci.
                       I think it is accurate to @-til:c tl),,i t :[.ii-;Iiativcs in  the  health

                  care field will have to be formulated to take account of the ])road
                  strategies that I have outlined.      IIhc-ithr-@r the strategies  are  directly
                  applicable to health, remains to be seen.        The. priv@ite-publi.c iiii),
                  that characterizes he@iltii car(--. is probably  as  complex  as  any  in  our
                 -society.   It has been the object of eiiori,,iotis attention ind growth,
                  with a random harvest of Pi-i.x (@d blc-sFiiig@3, in tiie yeii-s just p@ist.
                       A fundamental problem with desi(,r,.inZ; nc%-i          care    initiatives
                  is that we are  not  yet  really  clear  a-,  to  what  the  initiatives  should
                  be or N-iliere to put our Pioney  to  deal  with  the  so-called  health  care
                  crisis. As  to  the  major  themes  which  I  have  just  outlined,  it  may  well
                  be, in fact, tli@it, the peculiar  ptiblic-privat--e  character  of  the  health
                  industry is especially difficult to reconcile with soiie of these
                  In these circi-,@-istances, and in view of tiie enormous --i-qoul-it of  money
                  already going  into  1-tealth--6ylS  billion  Federal  funds,  $60  billion  Cross
                  National Prodtict--one can well ci-j:visioi-i  that  I  President  might  prefer
                  to make iic@@7 investments in improving   the cnvirorl-.ient lqhcre lie could feel

                  more certain about the results.

                       14hat is this  health  care  crisis,  any@.7ay?  If  you  ask  the  consumer,
                  the answer comes back  in  the  form  of  soi@ie  strident  questions  about  what
                  he is getting for his money.  Ile may not know the figures, but he is
                  aware of the enormous invest-,ieiit trie ii@it-.LC)n is making in health.   Ile


                x,iondcr-@ why all the people are not            the benefits oF what we
                know today.   Ile i.,,ondc-.cs x,7iiy our iiati.oi is 15'Lli in the world in infant
                mortality and 22iid in life expectancy for           why o,,Ie-11@Llf of the.
                babies born in public hospitals are I)orn to  Mothers  who  have  had  no
                prenatal care, and why a poor child has four ti.T,,ics the risk of  the  noii-

                poor of dying before he reaches 30 years of ige.
                     The big question is not lio@,7 much money should go into health, for
                after all, who can say what life is i..,orth?  Ratl:ic,.r it is @,ylietlier we
                would be better off at the $100 billion level, and what changes we

                would make in how we. spend it.  I think It is fair to say that we have
                arrived at our present state of crisis by poti3.-ing  our  resources  and
                good intentions into courses of  action  that  turned  out  to  have  elements

                of mythology about them.
                     The first myth  was  that-viassive  governmental  support  of  biomedical
                research would set in motion  a  chain  of  events  that  would  automatically
                improve health care for all.  We supported research and harvested
                brilliant advances in  the  science  and  technology  of  medicine.  This
                activity shaped the medical schools of today, for -ood or ill, and in
                large measure determined the nature of today's medical practice.  But it
                did not, by iny means, bring about the delivery of these benefits to
                everyone; espedially-it failed to deliver then to those who.need them
                most. And in the  process  the  newly  generated  technology  placed  a  heavy
                additional strain on the delivery systeiii--in  costs,  in  manpower,  and  in

                other ways.


                                                                                    10

                    Then, as we I)e-an to recoL,,i:iize tl-.e "OL-liL-r A.,,-,iorica" of 40 or 50

               million poor          blcicl-,s,                  Iiidi,-Lns, and ot ers

               outside the reach of the system, we succu;@"beL' to the second  mytl-l--tliat

               the only thinc, standing betiqecn these people and the. best in he@-@ th

               care was lack of money.  l@Te poLircd our resources and our good intentions
               into providin,, money tickets irito the system thrati-li prc)-rams like

               Medic@-irc- and illi2dicaid.  These I)rogr@iins have accounted for by far the

               major @liare of Federal increase in cxpc@rcl-.Itures since 1.965.
                    But again wE,. found that autoii,,,@,t.:Lc delivery of the best in health
               care to everybody did not happen. The hard fact  is  that  76  percent  of
               the total. Federal expenditure for health is financing the  entry  into  a
               health care system that is not capable of rc@spondiiic,. lie have  learned
               to our bitter regret that in many places entrance  into  the  system  does
               not exist, and that added purchasing power of Medicaid  and  Medicarc-  has
               led to the dilution in qual.ity of care, increase in cost,  tnd  the  move-
               ment of more people into the hospital element of the system.  1,That is
               therefore first on the agenda to deal with the  crisis  in  health  care  s

               the need to control our methods of financing and then  a  major  effort  by
               society--Government at all levels and voluntary at  all  levels-,-to  build
               and shape a medical care system that natch6s our willingness to spend

               $60 billion or maybe.$100 billion a year.
                    I am not sayinQ that the expenditures for research and the financial
               assistance pro@re@nis were not needed and a public Food.  Quite the contrary.
                              0
               But it is clear that these two approaches, each based on principles that


                were part valid and pirt Triyt'Li, do not        the prol)l-c@i,,-t of lic@,..I.th
                care delivery either siii@,ly or to-(-@tlier.  To cio that N,;L., need to give
                major attention to efforts and resources to fashion  @L  cic@l-j-vr-ry  system.
                      If there is a @asic imbalance bcaci,7cori the fl.nai,,ci.i-i,, of health

                care services and the capacity of the health care system to respond,

                then we need a strategy of change which will expand capacity.         The

                strategy which I would suggest rests on a concept of investment as

                opposed to consumption.     Although we Jerry improve the i-,I@inigcment o  our
                fiiiancin- mechanisms, and x4e- may offer -.Incentives to raise efficiency
                and lower costs, let us  not  delude  ourselves  into  thinking  that  chance,,

                can come about through such actions.      To create @i health care systLnn

                will be no i-qliior fix-up operation.
                      As a concept, investment means diverting some resources from
                current consumption in order to increase and improve consumption at a

                future time. Attainin- the  benefits  of  tlie-irivcstr@ient  can  only  happen

                after the investment has been made.
                      Our financing mechanisms in health have been concentrated on fuiidinc,
                current consumption of health services.  Since the pressures on financing
                                                                                                C)

                current consumption ,7ill be very  great  in  the  coming  years,  it  will  be
                very difficult to generate sufficient investment funds from the current
                pa .tterns of financing health care.  Furthermore  the health care system,
                has not  traditionally funded much of its capital investment from current
                income,  a prominent example  beiiic,  the  financing  of  hospital  facilities

                throu-h  charitable gifts, Federal grants, and local tax revenues.
                      L>


                                                                                        12

                     Thus, since                          the        of change, brill,-@Lnc,

                about the desired chaii@,,,2s -,.rtd          in the health care system
                during tlia 70's will reqLiirc-. increased direct investments in the expan-
                 sion of capacity and the inducciaent of iril)rovc,.iiieiits in organization
                and coverage of services.    I emphasize  direct  investment  to  stimulate
                change because it is unlikely tfiat the  spontaneous  clian-es  within  the

                health care system will meet the challenge.

                     These are some of the investments thit         have to be made.    In
                addition to closing some of 'the basic gaps in manpower and facilities,

                we will need to invest in  innovative  use  of  health  manpower.  We  must

                increase our investment in research  and  development  in  new  methods  of

                health care as well as  the  support  of  biomedical  research.  We  must
                invest in the planning and riana(,.,e-,nent capabilities that are still very
                underdeveloped for a $60  billion  industry.  We  will  need  to  further
                invest in better information, data, and statistics which will guide the
                workings of the health care  system.  We  must  provide  seed  money  for
                improved care patterns. This seed  money  will  serve  as  glue  for  the
                eyi8ting finance,-, mechanisms which will not presently fund a more
                efficient and effective pattern of health services.  @lost important of

                all for the immediate future is an investment in filling the gaps in
                primary %-nbulatory care, which is the  main  barrier  to  improved  health

                services for the poor and increasingly for the not so poor.
                     No strategy is goin- to work, lio@,7o-vcr, unless we face up  to  some
                awesome decisions that -,.7e have been politely at-id carefully  avoiding


                                                                                                13

                  for many years.  John GLr(Incr on.--c observed that we Ire aii..@ious, but

                  iir..-Taobilized. lle can br@-,',, loose from  this  an@,ic,.ty-piralysi.s  syndrome
                  only if we asl-l sor@-,.e really searcliin- questions, and answer then lioi-ie,-,t]-y.

                  Questions like these:

                               '  in the lig
                        Can illel            lit  of  national  health  care  needs  and   the   state
                  of our resources, cling to the principle of fee-for-service as the general

                  rule?

                        Can  we  follow  the  freedo@---of-cliol.ce  principle  as  far  as  we  would

                  like to, in the light of those same needs and resources?
                        Can we leave such proc,,ran.,,s as  Iledicare  c,,i-id  Medicaid  uncontrolled?
                        Can a coffi,,-,,-anity hospital continue to operate its  "bus-,-iie  s"  on  the
                  basis of just filling its beds, or must it reach out to organize and

                  serve community ai,,ibulatory care needs?
                        If  we  are  to  effect  change  and  not  have  a  nationalized   system   like

                  that  of  Great  Britain,  perhaps  the   creation   of   new   community   institu-

                  tions  ard  investment  in  their  support  may  be   the   most   critical   invest-
                  ment  requirement  of  all.  For  health  car--  is   ultimately   a   personal   and
                  family  affair,  and  the  best  setting  in  which  it  can  be  provided   is   the
                  community.  But  there  is  in  the  health   world   today   no   institution   which

                  can  with  real  authority  plan  and  Tqan:i.,,,e  the  organization  and  delivery

                  of health care on the community scene.

                        We have  a  be,,.7i.lderinc,  array  of  individuals,  -gencics,  ind  institti-

                  tions.  I-,Te- have in equally                 array of C-,overru-ientil.  pro-.rams

                  seekin-  to  support  the   disparate   efforts   of   these   autonomous   entities.


                I,,Ie do riot have              foci-l@ pc)iri.'c for

                trusteeship of health resource-., for the benefit ol' i-Lr.J. responsive  to

                its people.
                      The nature oy' this           instituti.oi,. is not yet well  defined,

                but soLiL@ o'L the ingredients are clear. It  must  be  a  peculiarly  privlte-.-
                public i.,-iix, with sll--ro-ii.@, consulter involvement. This  proviso  may  make
                health  professionLtis  acutely  uncomfortable  but  the  professionals   have
                to r&cog-nizL- that they cannot -,o it alone.    It must be based on a priri-
                ciple of geographic responsibility, and it must be strong enough to
                @,act frori the medical resources of the arcta----physici.,iris,  hospitals,

                and others--the performance of defined health care functions on a gco--

                graphic basis.
                      Can this kind  of  community  institution  be  reconciled  with  the  broad

                themes  of  the  new  Administration?  Perhaps  it  cannot,  especially   with
                the  strong  iiitergovernmental@relatioiis  flavor  of  the  New  Federalism.  If
                not, you in the health  field  will  have  to  demonstrate  how  and  why  health

                care is different, requiring different approaches.

                      It seems to me  that  the  question  is  not  whether  sweeping  changes
                in the organization and delivery of health care will be made, but
                rather who will  make  and  direct  them.  The  answer  to  this  will  depend
                upon the willingness or the unwillingness of the health f       ield  to  face

                up to its awesome decisions.
                      In conclusion, let me ask whether health care is an end in itself?
                Are we ultimately concerned only with the prolongation of life and the


                                                                                     15

                ii-qproveiaent'of physical and i,@iet-,Lal health, narrowly etefined? Su cli
                a purpose, may motivate the individual researcher or the practitioner,

                but sociely's vision viust be greater and, if yoti        move to a
                higher planes,.. I would sLi -est that our ultimate  purpo@3c  is  to  enhance
                the quality of living, in all its  dimensions,  and  that  everything  we

                do should be vie-.!(-,d in this context..

                    An increasingly prevalent and corrosive characteristic of the
                spirit of the A:nierican citizen today is real or apparent individual
                despair and lack of confidence that he can deal. with the prol)le-i-ns of
                soc:Lety. Citizens, affected by this  spiritual  condition  are  unlikely
                to work to improve their health,  education,  or  welfare  because  they  do

                not believe that such improvement is possible.  This lack of individual

                confidence extends to the efforts of government, and I think to all

                other organized efforts as well..

                     I believe that the restoration of  trust,  and  OptilUiS!n--COTIfidence

                that the citizen is not helpless and that progress is possible--is

                an undertaking to engage  the  entire  nation.  Government,  for  its  part,

                needs to develop and carry out strategies that  will  advance  the  re::)irt
                of the necessary sense  of  individual  pride  and  progress.  Placement  of
                responsibility for health service  programs  in  the  community,  where  the
                people arms.. represent,- such a strategy. But it is for  the  people  in
                the community to answer the hard questions, face the awesome decisions,

                and effect the changes that society demands  of  them  tlirouch  the  action

                (not words and hopp-s) of citizens of a democracy.