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                                                                                  A Systematic Approach



                                                                                                SECOND EDITION



                                                                                          Herbert Harvey   Hyman, Ph.D.















                                                                                             AN ASPEN PUBLICATION"
                                                                                             Aspen Systems Corporation
                                                                                                 Rockville, Maryland
                                                                                                      London
                                                                                                       .4 non





              8    HEALTH PLANNING
                                                                                                                                                                                     History9
              sanitary  reform  movement,  which  remained  within   the   domain   of   local             Regionalization of Health Facilities
              Community  government,  captured  the  consciences  of  the  majority   of   the               Population  growth,  the  movement  from  rural  to  urban  areas,  and  rising
              American public. Although enlightened  studies  in  the  field  of  health  care             medical costs were instrumental  in  the  regionalization  of  health  facilities
              promoted modern  concepts  of  preventive  medicine,  the  institution  of  such                      as 1920.  Regionalization  was  the  response  to  such  needs  as  ade-
                                                                                                           as early
              programs met largely with opposition  from  the  centers  of  power  that  would             quate  provision  of  health  care  facilities-expressed  by  many   studies   in
              have been able to  make  them  realities.  The  most  progressive  changes  were             numbers of  hospital  beds  per  unit  of  population-and  facility  coordination
              to evolve in the early decades  of  the  twentieth  century.  But  again,  these             within a region.20  Prior  to  1945,  the  private  sector  played  the  dominant
              remained  sporadic  forays  into  the  realm  of  modem  health  care  and  were             role in initiating efforts to study these needs.  Each  effort  undertaken  by  a
              thwarted by a public that could not be  convinced  to  support  with  taxes  the             voluntary  group  focused  on  a  particular  locality  and  generally   remained
              kinds of  programs  that  would  have  been  required.  The  trend  toward  gov-             separate from  similar  efforts  undertaken  by  other  voluntary  groups.  As  a
              emment intervention  in  health  matters  was  slowly,  but  definitely,  emerg-             result, ciiteria varied from study to study.
              ing. Society's inability to control its purse strings and the  creation  of  the              In  1920,  the  New  York  Academy  of  Medicine   studied   180   private   and
              federal income  tax  accelerated  the  inevitable  formalized  type  of  central             municipal  hospitals  in  New  York  City  to  determine  if  there  were  enough
              help.
                                                                                                           hospital beds to care for  the  sick.  The  standard  measure  of  need  used  by
                                                                                                           the  academy  was  the  Public  Health  Service  estimate  @that,  at  any  given
                                                                                                           time, approximately  two  percent  of  the  population  would  be  sick.  Finding
              SIGNIFICANT HEALTH ISSUES: 1920 TO PRESENT                                                   that one hospital bed  existed  for  every  200  people,  the  academy  concluded
                                                                                                           that the health needs  of  the  population  were  being  met.  This  study  marks
              Prior to World War 11, health care delivery  and  efforts  to  coordinate  and               the first formal recognition of the necessity  to  plan  hospital  needs  in  the
              plan health services were generally initiated  by  private  (voluntary),  non-               United States and was  followed  by  a  number  of  local  and  regional  studies .21
              government agencies at  the  state  or  local  levels.  Studies  and  planning               These  studies  were  obviously  categorical  in  approach;  questions  of   geo-
              efforts  were  usually  disease  oriented,  categorical   or   fragmented   in               graphical distribution and availability of hospital care to  all  facets  of  the
              approach, directed toward specific health problems.  19  Efforts  were  initi-               population were never studied.
              ated by voluntary health  groups  such  as  the  National  Tuberculosis  Asso-               A  more  comprehensive  study   of   hospital   needs,   "The   Need   for   More
              ciation,  the  American  Cancer  Society,  and  the  American  Public   Health               Hospitals  in  Rurals  Areas,"  by  A.  B.  and  P.  Mills,  was   published   in
              Association. in an attempt to coordinate the  activities  of  these  voluntary               1935.22  The  authors  studied  the   question   of   population   density,   the
              health agencies, the National  Health  Council  was  created.  The  experience               number and training  of  physicians,  and  other  factors  related  to  determin-
              of the depression of the 1930s, World War 11, the profound  rise  in   medical               Ing need. This was  the  first  study  concerned  with  health  service  centers,
              care  costs  resulting  from  the  increasing  imbalance  between  supply  and               facilities of  250  or  more  beds  designed  to  serve  a  population  within  a
              demand, and  the  expanding  role  of  the  federal  government  in  providing               50-mile radius of the  cities  where  they  were  located.23  Again,  the  empha-
              economic  assistance  conditioned  a  steady  expansion  of  government   par-               sis was  on  the  number  of  beds  available  to  a  population.  The  important
              ticipation in the planning, financing, and delivery of health care. This shift               point of this study  was  the  NElls'  concern  with  the  question  of  regional
              to  increased  government  involvement  in  meeting  health  needs   is   best               health services.
              illustrated by examining the major health issues of the  pre-  and  post-World               Also  during  the  1930s,  a  joint  committee  of  the  American  Public  Health
              War 11 peiiods and the responses of the private and public  sectors  to  those               Association and the National  Health  Council  studied  the  provision  of  full-
              issues.                                                                                      time local health services in  the  United  States.  This  study  emphasized  the
              Between  1920  and  1965  several  major  health  issues  emerged:  regionali-               provision  of  services  nationwide  rather  than  in  specific  localities.  The
              zation of health facilities (provision and coordination of health facilities),               Emerson Report, as it came to be called,  was  not  released  until  the  end  of
              alternative methods of health care delivery, financing  of  health  care,  the               World  War  11.24  The  recommendations  in  this  report  concerned  traditional
                                                                                                           issues of public  health  services:  sanitation,  communicable  disease  control,
              impact of biomedical research, and health  personnel.  It  would  appear  that
              the most consolidated  effort  was  initiated  by  the  voluntary  and  public               maternal and  child  health,  vital  statistics,  and  public  health  laboratory
              sectors in response to the need of regionalization of health facilities.                     services. The report is connected to those nrevioii@Iv ci;rf-17c@.,A 1,@,





              10    HEALTH PLANNING                                                                                                                                   History       11


              statement of minimal standards for  local  health  services  in  terms  of  the          ties. A most significant change wrought  by  the  amendments  was  a  shift  in
              number of health  personnel  and  number  of  beds  per  population  unit,  and          emphasis from construction to planning of  health  services.  Under  the  Hill-
              per capita expenditure. The study was  notable  for  its  new  direction,  but,          Harris Amendments, state plans  had  to  apply  a  new  formula  for  assessing
              by the time of its publication, public health services  had  so  expanded  that          bed need, incorporating  utilization  data,  projected  population,  and  occu-
              the standards recommended were inadequate."                                              pancy factors.
                 Several  ambitious  efforts  were  undertaken  to  coordinate  health   care            The  Hill-Burton  Act  and  amendments  are  often  criticized  as   focusing
              delivery during the 1930s. In 193 1, the Bingham  Associates  Fund,  a  private          too narrowly on construction, with little stress on  organization  and  distri-
              foundation, established a  program  based  in  Pratt  Clinic  and  New  England          bution of health care  facilities.  It  should  be  remembered,  however,  that
              Hospital in  Boston  to  encourage  coordination  and  integration  of  medical          Hill-Burton  not  only  introduced  systematic  statewide  planning  and  mini-
              services for  residents  in  rural  areas  of  New  England.  The  program  was          mum national standards for assessing  hospital  need,  but  also  improved  the
              conducted  in  conjunction  with  Tufts  Medical  School.  In  1933,  the  Com-          quality of care in rural America .27 The act  and  its  amendments  were  limited
              mittee on the  Cost  of  Medical  Care  published  a  report  that  recommended          because  the  establishment  of  a  formal  relationship  among  hospitals   or
              the coordination of local  health  services  and  personnel  to  provide  maxi-          health agencies was not made mandatory.     18
              mum productivity of the scarce personnel and equipment.26                                  With the passage of  Hill-Burton  and  the  expenditure  of  vast  funds  for
                 Thus, it can be seen that, prior to 1940, numerous studies  of  health  care          hospital  construction,  the  federal  government   firmly   and   irreversibly
              services had been undertaken by diverse participants  in  the  private  sector.          became part of the  American  health  care  system.  National  health  planning
              These studies were  conducted  in  response  to  a  growing  concern  for  ade-          had been introduced. This fact, coupled with the great rise  in  medical  costs
              quate provision of health facilities for a  growing  and  more  transient  pop-          despite federal assistance, led to the formation of a joint  committee  of  the
              ulation and health services  coordination  to  avoid  duplication  of  services          American Hospital Association and  the  Public  Health  Service  in  1958.  The
              and to combat rising medical costs.                                                      joint committee sponsored  four  regional  conferences  to  develop  guidelines
                 Federal response  to  the  issues  in  the  1920s  and  1930s  was  limited.          for planning  a  coordinated  community  health  service  system.  Three  years
              Traditionally, personal  health  care  was  provided  by  the  private  sector,          following the conferences  a  report  was  issued.  A  rationale  for  areawide
              primarily  in  a  one  patient-one  physician  situation.   Further,   domestic          health planning had been provided.29
              unemployment  and  economic  instability  and  the   ensuing   World   War   11            The  joint   committee   recommendations   were   formally   recognized   and
              absorbed  federal  efforts  and  dominated  federal  concerns.  With  the  con-          expanded by the public sector in 1963  when  the  U.S.  Public  Health  Service
              clusion of  the  war,  however,  the  federal  government  had  more  time  and          issued Proceduresfor Area)t,ide  Health  Facility  Planning.  While  the  joint
              money with which  to  examine  those  issues  raised  by  the  private  sector.          committee  studies  were  being   conducted,   the   American   Public   Health
              The  passage  of  the  Hospital  Survey  and  Construction   Act   (Hill-Burton          Association  and  the  National   Health   Council   sponsored   an   ambitious
              Act,  PL  79-725)  in  1946  was  a  major  breakthrough  in  coordinating  and          project to produce  a  blueprint  for  a  system  of  preventive  and  curative
              providing health care facilities nationwide.                                             medical  services  and  environmental  health  protection  for  the  next   ten
                 The Hill-Burton Act provided federal aid to states for hospital  facilities.          years. Whereas the  joint  committee  was  a  cooperative  public  and  private
              To be granted funds, however,  a  state  had  to  create  a  hospital  planning          sector  venture,  the  National  Commission  on   Community   Health   Services
              council responsible for assessing  the  need  for  new  hospital  construction.          was largely a  voluntary  venture.  The  commission  was  funded  by  both  the
              Because of this condition for funding, states were forced  to  survey  existing          private and  public  sectors  through  grants  from  private  foundations,  the
              facilities (number of beds per unit population) before  they  could  apply  for          U.S.  Public  Health  Service,  and  the  Vocational  Rehabilitation   Adminis-
              construction grants. The intent of the act  was  to  coordinate  new  construc-          tration.
              tion with need and with existing facilities.                                               The study was conducted in three parts  and  required  four  years.  Part  I,
                 In  1954,  the   Hill-Harris   Amendments   to   Hill-Burton   revised   and          the  National  Task  Forces  projects,   consisted   of   numerous   autonomous
              expanded  the  program  to  include  funding  exclusively   for   modernization          studies; consequently,  the  recommendations  of  each  task  force  were  dis-
              or replacement of public and nonprofit  hospitals.  As  a  result,  the  number          jointed and  published  individually.  Part  11,  the  Community  Act  Studies,
              of institutions applying for  alterations  and  additions  increased.  Emphasis          studied 21 individual communities  throughout  the  United  States.  The  find-
              shifted from providing hospital care in rural areas to altering  urban  facili-          ings of each of these  task  groups  provided  the  basis  for  recommendations



                 12 HEALTH PLANNING                                                                                                                                        History     13
                 to be presented during  the  third  part  of  the  project-the  Communications        committee,  culminated  in  a  regional  comprehensive   philosophy   of   health
                 project. This part of the project tested  public  reaction  to  the  recommen-        planning as opposed to the emphasis on facilities         that   had    dominated
                 dations at four  different  regional  conferences.  The  commission's  report,        voluntary concerns during  the  1920s  and  into  the  1940s.  This  new  philos-
                 published in 1966, made the following major recommendations:                          ophy  became  law  with  the  passage  of  the  Partnership  for  Health  Act  of
                 1. Community health services need greater federal participation.                      1966.
                 2. Comprehensive  health  planning  must  be   undertaken   on   a   continuing
                   basis.                                                                              Health Care Delivery and Financing of Health Care
                 3. Regional  or  areawide  planning  bodies  must  be  established  to   corre-
                   spond to problem health areas.                                                       The  regionalization  of  health  care  is  only  one  such  issue   to   emerge
                 4. A  single  system  must  be   established   to   provide   personal   health       between 1920 and 1980.  The  rising  cost  of  medical  services  resulted  in  a
                   services that eventually will  combine  all  parts  of  public  and  private
                   health care.30                                                                      move to coordinate and  regionalize  facilities  in  order  to  make  more  effl-
                                                                                                       . nt use of the  health  care  system  and  to  avoid  duplication  of  services.
                                                                                                       cie
                 Concurrent with  these  efforts  by  the  voluntary  and  public  sectors   to        Rising costs also produced  new  trends  in  the  delivery  of  health  care  and
                 coordinate  health  services,  the  Commission  on  Heart   Disease,   Cancer,        the financing of health services.
                 and Stroke was  formed  by  President  Johnson  in  1963  to  recommend  steps         In 1933, after a three-year study of the  existing  system  of  personal  health
                 to  reduce  the  incidence  of  these  illnesses  through  new  knowledge  and        services in the United States, the Committee  on  the  Cost   of   Medical   Care
                 more complete utilization  of  existing  medical  knowledge.  The  recoi-nmen-        published a report that illustrated the inability  of  a  large  portion  of  the
                 dations of this commission  were  enacted  into  law  as  the  Heart  Disease,        population to obtain high-quality  medical  care,  owing  to  rising  costs.  The
                 Cancer  and  Stroke  Amendments  of  1965  (PL  89-239).   Even   though   the        most  significant  recommendation  from  this  committee  was  the   concept   of
                 initial study was categorical in approach, the establishment of  the  Regional        "pre-paid medical groups." The report states that:
                 Medical  Programs   (RMPS)   was   a   comprehensive   response.   Cooperative
                 regional arrangements were to be  organized  from  existing  medical  centers,           medical  service,  both  preventive  and  therapeutic,  should  be  fur-
                 clinical research  centers,  and  hospitals.  Fifty-six  health  regions  were           nished largely by  organized  groups  of  physicians,  dentists,  nurses
                 established and charged  with  evaluating  the  overall  health  needs  within           and  pharmacists   and   other   associated   personnel.   Such   groups
                 each region. Initially, the  act  covered  only  heart  disease,  stroke,  and           should  be  organized  around  a   hospital   for   rendering   complete
                 cancer,  but  the  1.970  amendments  expanded  the  program.  Two   important           home,  office  and  hospital  care.  The  form  of  organization  should
                 aspects of the act distinguished it from previous  legislation  and  voluntary           encourage  the  maintenance  of  high   standards   and   the   develop-
                 group emphasis on the coordination and provision  of  health  services.  First           meiit or  preservation  of  a  personal  relation  between  patient  and
                 the act provided for  local  participation  in  planning.  This  approach  de'           physician .12
                 parted significantly from purely state and federal planning of facilities that
                 were provided for in the Hill-Burton Act.  Second,  funding  of  projects  was        According  to  the  committee,  this  system  of  health  care  services  offered
                 provided for both planning and operating.                                             the  community  the  maximum  potential  for  productivity  of   scarce   profes-
                 Once  regions  were  awarded  planning  grants,  they   became   eligible   to        sional personnel and expensive equipment.
                 apply for funds to cover operating expenses of all projects in their  ju  iis-        The  concept  of  prepayment  and  group   practice   expressed   in   1933   was
                 diction. Initially, funding was devoted to  continuing  education  and  train-              rated into the pattern of  health  service  delivery.  In  1965,  a  survey
                                                                                                       incorpo
                 ing, but this emphasis has shifted to organization  and  delivery  of  patient        conducted  by  the  Department  of   Health,   Education,   and   Welfare   (HEW)
                 services,  and  improvement  of  personnel  productivity  and   distributional        of 582 group plans showed that the plans fell  into  five  categories,  depending
                 Unfortunately, the RMPs  were  not  incorporated  into  existing  federal  and        on sponsoi- or consunici- ol-jel,tZ,tioll.33 The      community-consumer       plans
                 state programs, causing both duplication and gaps  in  delivery  of  services,        are nonprofit plans designed  to  serve  the  general  community  ora  particular
                 personnel training, and research.                                                     group.  These  plans  incorporate  prepaid  medical   services   on   a   private
                 The  passage  of  the  RMP  legislation,  together  with  the  recommendations        basis, not a  group  practice  basis.  The  Health  Insurance  Program  (HIP)  of
                 of  the  National  Commission  and  the  guidelines  published  by  the  joint        Greater  New  York  and  the   Kaiser   Plan   are   well-known   exam   les   of
                                                                                                                                                                             p