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                    NATIONAL ADVISORY tOUNCIL ON

                    REGIONAL MEDICAL PROGRAMS

                    THIRTY-SECOND MEETING

                                              Parklawh Building
                                              Conference Room G
                                              Rockville, Maryland

                                              Tuesday, February 12,, 1974
                                              9:00 o'clock a.m.

                    ATTENDANCE:

                    Dr. Herbert B. Pahl.- Chairman
                    Dr. Laurence Foye,Jr.
                                                         @l vv,
                    Mr. Edwin C. Hiroto
                    Mks. Audrey M. Mars,@'
                    Dr. John P. Merrill i
                    Mrs. Marl6l S. Morgan4'
                    Mr. Robert C. Ogden

                                 e",4


                                                                              2

                                      P R 0 C E E D I N G S
                                      - - - - - - - - - - -

                             CHAIRMAN PAHL:  Perhaps we,,might get started and

                   call the meeting to order. I want,to say that I  guess  that

                   I should use the telephone,, because our staff now outnumbers

                   the council by quite a few membersialthough we hope to  have

                   that corrected very shortlyi and we have word that some  new

                   members will be coming onto the council before too long, and

                   so hopefully we will be back to full strength.

                             Before introducing Pr. Endicott to you, who has  I

                   think some very important things to say to all of us  this

                   morning, I'd like to go through just a few usual annOuftcO-

                   ments and first call to your attention in your books the

                   conflict of interest statement and also remind you of  the

                   confidentiality of the meetings.

                             This portion of the meeting is an open meeting, and

                   we will have the closed meeting when we discuss the specific

                                later today.

                             I again wish to welcome Dr. Larry Foye from  the

                   Veterans Administration, who it again representing

                   Dr. Musser oh the council this morning.

                             I am Sorry to say that neither Dr. Ochsner nor

                   Dr. Schreiner will be able to be present with us.  We have

                   known about Dr. Ochsner's conflict of interest some time

                   back, but we just learned yesterday about Dr.  Schreiner's

                   inability and we're sorry that he can't be with us this


                                                                             3

                   morning.

                             We have in addition to Dr. Endicott the  oppor-

                   tunity later today--I believe it's at 1:30, Ken?

                             MR. BAUM: Whenever he gets here  but  presumably

                   1:30.

                             CHAIRMAN PAHL:  About 1:30 this afternoon,

                   Mr. Eugene Rubel, who is the Acting Associate Director  for

                   Health Resources Planning and under a new administrat  ve

                   arrangement, will be having much to do with the RMP program

                   and this council. And he will be meeting and  talking  with

                   us this afternoon.

                             Apparently we are a small enough group that  the

                   cafeteria can accommodate us directly. So, we'll  break  at

                   an appropriate time for coffee and also have lunch in  the

                   cafeteria rather than try to run through the  proceedings

                   today as we did bef ore.

                             The other individuals I would like to recognize as

                   being here specifically are Dr. Charles Lemke, who is  the

                   coordinator of the Wisconsin RMP, and Dr. Marvin Dunn,  who

                   is the Deputy Director of the Bureau of Health  Resources

                   Development in this agency, and also Dr. James Gaye,  the

                   coordinator in the New Mexico regional medical program.

                             And now with that and also a brief note of  it's

                   nice to be back and see my own co-workers for at least a day,

                   I'd like to turn over the meeting to Dr. Endicott, who I think

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                   has a number of important items for all of us.

                             ;,DR. KENNETH M.'ENDICOTT: @I think perhaps the most

                   important thing for me to do first is to try to share with

                   you my view of or@sense, gut feeling, of where it is that

                   we're going in-the health area these days,  it has been a very

                   confusing period for all of us4   And there has been a  lot  of

                   open antagonism and animosity and counter forces at work

                   which have been I think very confusing for all of us,

                   certainly for me.

                             The events which occurred about a year ago  in  which

                   there was a sudden decision in the middle of a fiscal year

                   to make meat ax cuts in the operating budget for that fiscal

                   year and to abruptly terminate a series of health programs

                   of the federal government imposed some stresses and strains

                   and,set into motion a sort of chain reaction of events which

                   has continued for the entire year, with a number of quite

                   serious consequences.

                             The Administration had reached a pretty firm

                   decision to make some major changes in the federal health

                   programs, and simply to eliminate a number  of  lower  priority

                   programs, programs which were felt to be less productive

                   than they should be or which perhaps had outlived their

                   purpose in some instances.

                             And, as I say, the actions were  very  vigorous.  And

                   in the case of RMP led to the issuing a notice that the


                                                                                5

                    program would be liquidated within a  few  months.  But  this
                    was not the only program. I think you get  a  feel  of  this

                    thing. You have,to remember that it was  only  part  of  the

                    picture, and that there were many other  programs  in the same
                    general predicament with interactions and so on,   which  al
                    summed up made some major changes in the entire    situation.

                               Basically what the Administration proposed was

                    to pay primary attention to the financin
                                                                    ealth

                    services and to hammer out As principal federal responsibility

                    in the health Area some form of  national  health  insurance

                    which would equalize for the whole population  access  to  the

                    health care system.
                               And in the process of doing this to drop  a  number

                    of direct health services or categorical grants  of  one  form

                    or another in the health area.

                               It was proposed, for example,@that we  set  about

                    eliminating those programs in which  the  federal  government

                    provided direct health services  insofar  as  possible.  And
                    one of the things that was proposed was that we close all of

                    the public health service hospitals.
                               Another thing that was proposed was that  in  the

                    case of the Indian health service,  for  example  that  steps

                    be taken to determine whether or not provision of@health
                    care to the Indians might not be transferred to the private@

                    sector.


                                                                              6

                              In the case of categorical grants, such as

                    maternal and child care, migrant health service, community

                    mental health centers, a whole series of cate orical@ grants
                                                                 9

                    aimed at financing specific types of health services through

                    categorical grants, primarily to states, that these

                    programs also be phased out in favor of some form of block

                    grant or revenue sharing with the long-term obvious

                    intention that ultimately these programs too be folded into

                    national health insurance.

                              It was proposed that in the area of higher

                    education generally and in the area of health manpower

                    specifically that the federal government pretty much get out

                    of the business of subsidizing higher education or the

                    education of those who would work in the health field by

                    terminating any form of institutional subsidy, subsidy to

                    the educational institutions.  And that the federal effort in

                   t he broad area of higher education and specifically in health

                    manpower, federal effort be limited to assuring that

                    competent students hot be turned away for financial reasons

                    and that the federal subsidy largely be limited to student

                    aid.

                             There was a widespread attitude that one encountered

                    in the department and in the office  of Management and

                    Budget that physicians and dentists, for example 'could look

                    forward to a relatively high income when they,completed

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                    their training and that they should be paying a  much  larger

                    share of the cost of their.@education and to this end it  was

                    proposed that access to the private m6nev market be

                    improved so that they could borrow money and pay more

                    tuition and that@the educational institutions find their

                    subsidy through higher charges to the students.

                              In one area, for example, which represented a

                    program that had been in existence for a long time in the

                    National Institutes of Health, where money was  provided  for

                   @the training of people to work in the field of research or in

                    the field of academic medicine, programs which  were  called

                    research training grant programs or fellowship  programs,  it

                    was.proposed over a period of two or three years to phase these
                    out completely, the  hase-out period  being extended only
                                        p

                    long enough to carry those through the pipeline who were

                    already in some stage of advanced training.

                              There were a limited number of fields which the

                    Administration recognized as appropriate for continued lotg-

                    te=,,Iessentially indefinite federal  sponsorship  And  these

                    included biomedical research preventive medicine and

                    public health, and consumer protection such at is   involved
                    obviously in the Food and Drug Administration and  in certain

                    aspects of environmental protection.

                              This was the basic concept- And,  of  course,  for

                    programs which are now part of health resources in@the


                                                                               8

                    Administration, this really meant that the entire Bureau  of

                    Health Manpower was expected to be eliminated.  The

                    organization resposible for the Hill-Burton Hospital

                    Construction Program ekpected to be eliminated.  RMP expected

                    to be eliminated.  All Of the training grant people in NIH

                    expected to be out of business. Those in the  mental  health

                    institute who were concerned with community mental health

                    centers and that sort of thing expected to be phased out.

                              Steps were set in motion to carry out reductions

                    in force of major segments of the staff.  And those who could

                    began seeking other employment.  Staffs began to wither

                    away. And in, I suppose what you might call  our  clientele,

                    those receiving grants whose employment was dependent oh

                    these grants, also began to fade away.

                              I suppose by now the RMP staffs out in the  field,

                    from reports reaching me, are substantially less than half

                    what they were a year ago4  Three of the 56, I believe, have

                    gone out of business completely and perhaps a dozen or  more

                    of the remaining 53 are operating just at a bard skeleton

                    level.

                              The review committees which had been in  operation

                    to provide preliminary review for this council have been

                    abolished.  And these are some of the things that have

                    happened to RMP.

                              In other areas I am familiar with in the health


                                                                               9

                    manpower area particularly, schools of public  health  which

                    expected to be cut off last July without any further

                    support have issued oink slips to substantial numbers  of  the

                    faculty. They have gotten emergency bail out  so  that  none

                    of them has closed.  But probably out of the 18 schools

                    perhaps two or three which may very well not  survive  through

                    the next year.

                              The medical schools, dental schools,  and  related

                    health professional schools are faced with a  reduction  in

                    training grant support, and simultaneous reductions in

                    other forms of institutional support of one sort or another

                    have Also rolled back faculties in a tumber--full-time

                    faculty have been substantially reduced in a number  of  these

                    institutions.

                              It became evident by the end of last  fiscal  year

                    that Congress was going to resist some of the changes

                    proposed by the Administration. And the  first  evidence  of

                    this occurred in connection with the Public  Health  Service

                    Act. About 10 or 11 major parts of that  act  the  enabling

                    legislation terminated last June.

                              The Administration had proposed to  the  Congress

                    that five or six of these not be renewed. None  of  those,  of

                    course as you know, was RMP.

                              Others included included sup
                                                           port to schools of

                    public health,, allied health, Hill-Burton, and there  were

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                                                                              10

                    several involved. Congress, instead of  eliminating  these

                    authorities in a block action, simply extended all of  the

                    expiring legislation essentially unchanged for a period of a

                    year to give the Congress time to consider in depth what

                    precisely ought to@be done, what programs ought to be

                    eliminated and which programs ought to'be,@modified.

                              And so that was the first signal that perhaps

                    the ma or changes@oronosted by the Aami istration would not

                    all of them be tarried out.

                             The next evidence of a substantial difference in

                    the philosophical approach to the health problem I suppose

                    could be and should be read into the congressional  Action

                    with regard to the appropriation for fiscal i9l4.  First

                    the@House and then the@Senate reported out and passed

                    appropriation bills for health which very substantially

                    exceeded the Prdsideht's budget,  And@@there was4a threat of

                    a veto if the appropriations were hot rolled back.

                             And finally conferences were held between  the

                    Administration and the conferees, the House and the Senate

                    conferees, which led to a compromise on the ap ropriation,
                                                                 p

                    a compromise which allowed about $1 billion more than  the

                    President had requested, and there was an understanding that

                    this would hot be subjected to impoundment and that the

                    money would be spent.  And this was sent to the Whitd House

                    and was signed.


                              on the same day it was signed, an announcement

                    was issued that the monies which had been impounded in  1973

                    would be released. And so this meant that for  fiscal  '74  t

                    least programs which thought they were dying s  ddenly  found
                                                                   u

                    themselves,with more,money perhaps than they had ever  had

                    for any one fiscal year.

                              But the question still remained, what about 1975

                    and after that?

                              And for Us, HMRA, this is still a very important

                    question, and it's important for several reasons.  First  of

                    all, all of our legislation expires this year, every bit  of

                    it, for old, well-establited programs like national health

                    statistics, vital statistics, birth and death records, for all

                    areas of research in the delivery of health  services  all

                    the manpower legislation, RMP, CHP, Hill-Burton,  everything,

                    all runs out at the end of this fiscal year.

                              And one cannot at this point in time really

                    predict what the Congress is going to do, because in most  of

                    these areas there aren't even bills in the hopper yet.

                              The House has acted to extend the  authorization

                    for health statistics and for the National Center:for  Health

                    Services Researdh and Development.  But even here they

                    propos e to consolidate them. And I for one am  not  at  all

                    satisfied with the action taken by the House, and I do  hope

                    that something can be done to straighten this out in the


                                                                                 12

                    Senate.  It put some artificial limits on the number of

                    projects that one can have in any particular  area  of  health

                    services research and put a limit which is absolutely

                    artificial and there's simply no justification for it, a

                    five million dollar ceiling on the amount of  money  that  can

                    be spent in Any one area of health services research.

                              Now, to me, this is preposterous.  When we're

                    dealing with an industry that spends somewhere between

                    eighty and a hundred billion dollars a year, to put a

                    limitation of five million on  what you can spend  is  looney.

                    I do know what this represents.  Congress was unhappy with

                    what some of my predecessors did with  that  authority.  But  I

                    do believe that they overdid it in  putting  these  limitations

                    on it.

                              There have been no bills introduced whatever in

                    the health manpoweri@area, no bills introduced in the

                    construction area, and there is a little flurry  of  bills  now

                    As they relate to RMP, CHP, and Hill-Burton,  which  I'll  come

                    back to and discuss a little bit later.

                               But we really don't know what it is that we are

                    going to be authorized to do six months from now.  The

                    straw in the wind, of course, is what's in the President's

                    b udget, because that was sent up a week ago. We  had  a  press

                    conference a week ago last Saturd-_ay, and the budget went  up

                    a week ago yesterday to the Congress. And  this  budget  is  a

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                    very spartan budget in the health area.

                               As an example, the total available funds for

                    obligation in the current-fiscal year for the Health

                    Resources Administration are in the order of the general

                    vicinity of $1,800,000.  And the budget proposed for fiscal

                    1975 is five hundred million. And any way  you  look  at  it,

                    that's a whopping cut.

                               The problem is will we repeat last year and end

                    up with a, large amount of  money over and above that  budget

                    or will that budget  obtained  or may it be even  lower  that?

                    And frankly I:don"t know.  And  it's,very hard for all  of  us,

                    it's going to be hard for you,  to know just what to do in the

                    face of this degree of  uncertainty.

                               The largest sums for this administration  are  not

                    in RMP.  The large sums are in health manpower and in

                    hospital construction. And those who  are  concerned  with  the

                    administration of our academic health science  centers  and  so

                    on can't help but be nervous about their future  and  it  prob-

                    ably will be months before the legislation is  enacted,  and  I

                    wouldn't be at all Surprised if it's A year before the

                    question of appropriations is finally settled.

                               So, we have ahead of us a long period of uncertainty

                    and I don't see any way out of it.

                               This has been sort of a kind of rambling

                    presentation, but I think  I needed to share this with you


                                                                              14

                    so that you could have-a better feel for just what we  must

                    attempt to do in carrying out our function over the  coming

                    months.

                             I'd like now to forget about manpower  and  hospital

                    construction and such like programs and direct our

                    attention to RMPL CHP, and Hill-Burton.

                             It is fairly clear that a consensus is beginning to

                    emerg6, bipartisan, involving both the Congress and the
                    Administration; and I hope the public# although I'm not too

                    sure@aboui that.. But there is clearly a consensus

                    developing in qovernment,that these somewhat interrelated
                    programs should be consolidated And that this consolidat on
                    represents an important step forward in preparing for

                    national health insurance.

                             There is no point in my explaining to you what

                    RMP does, because you know more about that than I do.  But  I

                    should, make scone comments about the rest of this complex.
                    Let's begin with the Hill-Burton hospital construction

                    program.

                             This is an old program.  It has been in operation

                    at least 20 years. It was launched initially  in  recognition

                    of the acute: shortage of hospitals in the small towns  And

                    rural communities across the United States. And  the  federal

                    goverment, through a formula grant program to  the  states,

                    undertook to encourage the construction of health care


                                                                              15

                   facilities, primarily small hospitals in  small  communities

                   and rural areas. This required matching and was obvious  y  a

                   program which was needed. The matching was forthcom  ng,  and

                   I'm sure all of you can point to a number of hospitals  that

                   were constructed as a result of it.

                             As a matter of fact, we probably overdid  it.  I

                   think there is a general consensus that in many areas of  the

                   country we are, as they say, overbedd0d. We have  more  beds

                   than we tan effectively use, and occupancy rate in  some  of

                   them is very low. Some of them really have  no  patients  at

                   all.

                             During this two decades the program has been  in

                   effect, the financing of health care in the United  States

                   has changed very substantially, and a very large portion  of

                   the population is either covered with private health

                   insurance or the elderly and the poor through  Medicare  and

                   Medicaid. So that that it is now possible for  hospitals  to

                   build into their day-bed costs, capital reimbursement

                   features which make it possible for them to either fund  a

                   depreciation account or amortize consutruction loan.  And the

                   need then for federal grants for hospital construction has in

                   6ffect.disappear6d in a number of situations.

                             There still remains a need, and probably an  urgent

                   one, to renovate the hospital plants in the inner city,

                   many of which were built 30 or 40 or 50 years ago and  Are


                                                                               16

                    hopelessly outmoded.  They're not even safe from the

                    standpoint of safety codes, and they're dreadful messes

                    with large hideous wards and so on.  They're ineffic ent and

                   .,they need attention.  And they are in communities that

                    generally speaking can't afford to do something  about  it.

                    Sot this is one area that still needs attention.

                              Then I think vtobably we are  undercapitalized  for

                    the provision of ambulatory care and probably long-term

                    care. As one looks forward to national  health  insurance,,

                    the expectation i,, I suppose, that the charity patient or

                    indigent patient will not too far down the  road  disappear

                    from the@@Isceneand institutions which@provide care to  them,

                    their position will improve with regard to ability  to  get

                    money in the private money market for hospital facilities.

                              The expectation@is,also that the benefit package will

                    be more adequate with regard to primary care and to long-term

                    care, so that the difficulty of amortizing ambulatory care

                    facilities will probably diminish too.  But the expectations

                    are that there will still be poverty pockets around the

                    country, economically depressed areas, whic h will not be able

                    to put up enough money to get into the private  money  market

                    in,@the first place. That is, they'll hot be able  to  make

                    the downpaymeht which will permit them to get a mortgage

                    for a new facility.

                              No, we are proposing, and 1 think  the  Administra-


                                                                              17

                    tion will probably propose to the Congress, that a modified

                    Hill-Burton program aimed at providing renovation and

                    ambulatory and long-term care facilities in poverty  areas

                    will be proposed and, I imagine, enacted by the  Congress.

                              one of the problems, of course, that would go along

                    with this will be an intelligent decision at the community

                    level as to what facilities are really needed.  And I'm sure

                    all of you can view with alarm facilities which have  been

                    built or are proposed to be built which ate probably not

                    needed and which would jtst run up our health care bill.

                    And this is where we begin to get into the future role  of

                    CHP, RMP, and Hill-Button.  How can we develop an effective

                    apparatus at the national, the state, and stb-state  level

                    for planning our health services, determining the resources

                    that,are needed, applying whatever regulation is necessary to

                    hold down the costs, and allocate the available  resources

                    for the physical plant, what I'm talking about  hospital$,

                    and also for services of one kind or another which require

                    'Joint Action and which would not get off the ground if one

                    were dependent on the health service industry As it how

                    ekists, such things as--oh, you've had a lot to do with

                    developing emergency medical services, coronary care units,

                    in some instances cancer referral centers; current

                    appropriation calls on you to create some arthritis centers,

                    things of this sort, over and above what you would normally


                                                                               18

                    find in a fee for service professional practice in a

                    relatively limited hospital, community hospital service.

                              How are we going to plan these? How are  we  going

                    to allocate them?  How are we going to regulate them?

                              What has been proposed in the Congress in the

                    legislation which is now in the Congress is  interesting.  I

                    won't describe it. You probably are familiar  with  it.  This

                    is the Rogers-Hagtings-Roy Bill which would establish at  the

                    national level a commission on health, a prestigious

                    advisory body which would advise the executive and legislative

                    branch on health policyi

                              It would create in each state a health  commission

                    with broad regulatory powers, with substantial emphasis on

                    cost containment, and would create at the sub-state or  where

                    appropriate, the interstate level, health agencies which

                    really would be a combination of what RMP and the CHP "Bil

                    agencies and some of the experimental' health service

                    delivery systems and some of the area health education

                    centers have done, not only in planning but also in

                    implementing various forms of community action in the  health

                    area.

                              The law prescribes how these various bodies  would

                    be appointed and what they would be composed of, provides

                    for federal funding, essentially hundred percent funding  of

                    course of the national commission and the regional health

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                   .authority,, partial funding of the state commission,  and  it

                    has some provisions in it for resources that  would  be  pumpe
                    into this system, not only to operate the system but also to
                    carry out some of the sorts of things that you  have  done  in

                    RMP.

                               This bill would provide for a one-year  period  in

                    which operational support for CIIP, RMP, and  Hill-Burton  would
                    continue, presumbaly at a somewhat reduced  level,  in  order

                                                               ly transition  from
                    to provide a one year period for an order

                    what we have  now to this new thing.

                               The Administration is putting  the final touches on
                    its own legislative proposal, which 1 suppose will go  for'-ward

                    in a matter od days or weeks.

                               Mr. Zwick, do you know what the schedule  is  right

                    now for sending this up to the Hill?

                               MR.ZWICK: No, I don't think you have  A  date  yet.

                    It's premature. It should be within the  next  two  or  three

                    weeks, I would say.

                               DR. ENDICOTT: Well, that will give  you  a  general

                    sense of the timing.  It's not too unlike the bill in the

                    House except that it lays greater emphasis  on  the  regional

                    sub state apparatus and it is sort of  silent  with  regar  to

                    the state function in this whole thing  and  perhaps  emphasizes

                    'more than the House bill cost containment features.

                               Almost everyone who has looked at the  problem  fOels


                                                                                20

                    that there has to be a community or sub-state organization

                    which combines @oine@of the f6atut6s of CEP and RMP and  Hill-

                    Burton. So, I think that in planning what we are  going  to  do

                    over the next'18 months it is safe to assume that something

                    ,of this sort will happen and that we should direct our

                    energies and our available resources as best we can  in  moving

                    in an orderly way from where we are now to a situation of

                    that kind, ind,,we'll simply have to leave to the Congress  the

                    precise terms, precise makeup, of the advisory bodies,

                    precise way in which they are going to be funded, and just

                    how the state government, the local government, w 11

                    participate in this regional approach which almost everyone

                    feel6 should be private, non-profit, consortium kind of,

                    thing, with representation of providers, of consumers, ao'd

                    of relevant government officials.  But just what the mix

                  "should be, I think we'll have to waLt for that to  be  resolved.

                              Where do we stand specifically with RMP.1

                              The court order has been signed directing

                    government to release impounded funds and  appropriated  funds

                    and to obligate them by the end of this fiscal year  under  the

                    kinds of terms which existed prior  to the time the money  was

                    impounded in the first place.  And of  course the Administration

                    will obey the court order and that part of the  hassle is  over

                    with.

                              So,, let's see, this is the 12th of February.  We


                                                                                21

                    have  from now until the 30th of June to obligate a

                    substantial piece of money.  I have never been able to find

                    any two people that agreed exactly as to how much this  'IS.

                    The judge refers to $150 million.  I can't find that.
                                           -w@     ?,Mw@
                    Others talk about a hundred million.  I think that is probably
                    a little bit low.  But when the accountants get through with
                    this complicated mess in the matter of another week  or  so,
                    we'll know exactly how much it is.  It's  something  between
                    A hundred and a hundred and fifty million.  And it's probably
                    more than we'll,quite know what to do with anyway.  So, it's

                    hot all that im ortant how much it is'.
                                  .p

                              But we will certainly have enough money to do what

                    it is that@we ought to do. 'And@l think we can leave  it  At

                    that.

                             An objectiV6,,appraisal of the situation is that the
                    capacity of the RMP's out there to react has been substantially
                    compromised by this long period of uncertainty and delay.

                    Some of them clearly in worse shape than others, but I think

                    all of them clearly have been hurt.

                             Furthermore, to look at it realistically they like
                    we have to move into a kind of uncertain future and will have

                    to ask themselves, What can we do that's worth starting  and

                    that reasonably could be expected to continue under the  new

                    system, whatever that may be?

                             This will be a real challenge and I  think  we  can


                                                                                22

                    get the job done only if each one of us sincerely tries in

                    his own mind to picture what our society seems to be heading

                    toward ahd,what will likely make sense in the light of some

                    'health insurance enactment, some change in the organizational

                    structure, and this will have to be done I think mostly at

                    the community level.  communities are going to have to

                    decide what  sorts of things could be legally initiated

                    under the RMP authority which they will want and will expect

                    somehow to continue beyond this period of uncertainty.

                              So, the RMP's are compromised in their ability to

                    react.  We are compromised in our ability to evaluate their

                    proposals, since our advisory committees have largely been

                    liquidated and that to our professional and supoortive'staff

                    a bomb.

                              In pondering about this problem myself, I think tha

                    the council and the staff must place 4 good bit of dependence

                    on the regional,advisor   grou s for sorting out their
                                           y     p

                    priorities, and #de I
                                       re going to have to stack them up  one

                    against the other As best we can with the htaff that we have,

                    whatever consultants we can get to help us, and then what

                    you can do yourselves in looking at the material that is

                    assembled by the consultants and the staff for presentation

                    to you for decision.

                             And I'm sure of course the next day that Herb Pahl

                    and the members of the staff will be working out with you


                                                                                23

                    what seems to be a reasonable schedule for receipt and

                    review of applications. I imagine we'll have  to  give  a

                    reasonable amount of time to the RMP's and to the CHP's to

                    think about this problem and to develop and evaluate their

                    proposals.  we don't want to do this in a hasty way.  And I'm

                    sure that neither the staff not this council will want to

                    take hasty action on what is presented.

                              The one fixed date against which we're all

                    operating is June 30th. The money must  be  obligated  by

                    June 30th.  And what this means is that in writing and

                    officially we must commit ourselves As to how  the money is

                    going to be spent b6fote June 30th.  This does  not mean that

                    the recipients of the grants or the contractors have to spend

                    the money they get by June 30thl but we have to  make our

                    commitments.  And the court order ditocts us to  choose the

                    old and tried and true familiar methods under  which  the

                    grantees expended   eir funds@

                              You know what that was better than I do, but if it

                    is anything like thg,,programs'l am familiar with,, it generally

                    means that the mone.Y,is available to the grantees for  a

                    period of 12 months after the  award is made, and this has

                    generally been subjtct to extension  without additional

                    funds for periods of sometimes several years beyond that

                    period of time.

                              But the general intent here, the general guideline,


                                                                                      24

                      is for project periods that run from a year from the

                      beginning date. And I  think  that  is  what  you  operate  from;

                      is that correct?

                                 CHAIRMAN PAHL:  Yes.

                                 DR. ENDICOTT: That  sort  of  gives  us  a  framework.

                      We have five months or four and a half months in which to

                      'commit mohieg which reasonably would be expected to be

                      expended within the 12 months following that, under the

                      guidelines afid,@lla*is and regulations and so on that you

                      operated with before the freeze.

                                 My view--and I hope you will discuss this in the

                      next   day--ig that in order to get this thing off   the   ground

                          flying,  @4  probably ought to convene a nationa

                      of  the  RMP's to  discuss this with them.  And since   they will
                      be expected  to interact with CHP'and'Hill-Burton agencies,,

                      they probably should  be, invited tooi so that we all have some

                      kind of  community  sense of what the heck it is that we're

                      trying to do.  And I don't know how son such a meeting

                      could reasonably convene.  Some notice will certainly be

                      necessary, I suppose.  It ought to come in Mardhl early

                      March, I should think.

                                 CHAIRMAN PAHL:  We have a tentative meeting of

                      the RMP coordinators scheduled for--what is it, Bob?

                                 MR.CHAMBLISS:   March 5th and 6th.

                                 CHAIRMAN 1 PAHL:      March 5th and 6th.  At the

                      time that  that meeting was proposed,  we  had  not  invited  the


                                                                              25

                    Hill-Burton or CHP people other than Mr. Rubel.

                              DR. ENDICOTT:  You ought to give some thought to

                    this because you're going to have--some organizational

                    changes are going to have to be effected out there, and it

                    will vary from one community to another as to just how they

                    would propose to consolidate,, say, "B" agencies or 'A"

                    agencies  in RMP and Hill-Burton agencies.

                             So, MY feeling is that they ought to be involved,

                    and I think we probably also are going to have to set up

                    some way of communicating with state governments to get them

                    on the track in this area too.

                             We're expecting momentarily an indication from

                    the Conference of Governors to have a meeting with the

                    governors,to discuss this area.  But I@don't know just when

                    that will come off.  But clearly the states are going to have

                    to make decisions as to just how they want to approach this

                    on the sub-state level. Now they want to interrelate these

                    health agenci'es'or whatever it is we are going to call them

                    with other state planning districts in the field of human

                    resources  with such things as PSRO and other types of

                    health activities, and I think it would be a serious mistake

                  I for us simply to decree how this is to be done on the national

                    level.  I think there ought to be substantial involvement of

                    state governments in working out the best pattern for them

                    from a geographic standpoint as to how they approach this


                                                                                26

                    regional thing.

                              These, it seems to me, are the tasks which are

                    immediately ahead. We have--I shouldn't  say  "we,"  because

                    I am the one who decided to do this--I have already taken

                    steps to consolidate the staffs of CHP, RMP,  and  Hill-Button.

                    And to do this at least for the time being within the

                    framework of the Bureau of Health Resources  Development  where

                    CHP and RMP were already located. What this  amounted  to  was

                    changing a situation so that the RMP staff also  reports  to

                    this bureau. And Dr. Green, who is director  of  that  bureau,

                    has designated An associate director for health  planning  who

                    will have the responsibility on an interim basis of coordinat-

                    ing the Activities of the staffs of these  three  divisions.

                    Because we have to get in position staffwise to  handle  the

                    new system and at the same time to carry on activities  wh  ch

                    represent the transition from where we  are to 4here we  are

                    going to be.

                              Hill-Burtoh,, for example, has $390 million to  spend

                    for hospital construction while we're undergoing this

                    transition,, so they'll be plenty busy with their normal

                    ,business. You have a hundred to a hundred And  fifty  million,

                    and the CHP agencies are in the process of an intensive

                    evaluation of all of the "A" and "B" agencies and  are  trying

                    to get operational on section 1122, which some of you  may  be

                    familiar with;and others not.  This is a provision in the


                                                                                 27

                    Social Security Act which requires that any capital

                    expenditure in excess of $100,000 must be approved  by  the

                    CHP agencies or it cannot be reimbursed under Medicare and

                    Medicaid, and there are very few facilities in  the  United

                    States that don't have some kind of interaction with

                    Medicare and Medicaid.  So, what this really means is that

                    all capital outlays of $100,000 or more have  to  be  reviewed.

                    And with the thousands of facilities involved in this

                    country, that is a lot of business to attend  to.  So,  CHP

                    has its problems,  Hill-Burton has its problems,  you have

                    your problems, in 3ust operating  and at the same time

                    carrying out a transition.

                              Now a word about decentralization.  CHP and Hill-

                    Burton ate decentralized programs and  have been   decntralited

                    to the HEW regional offices from their  very inception.

                    is not.  This program has been,;op6rated in a very centralized

                    fashion almost the ent'L."re staff being located here in

                    Washington and with minimal participation  of regional   office

                    staffs and RMP activities.

                              Cleakly in this interim period,, we are going  to

                    have to bring the RMP organization  and staff into line with

                    the others in terms of decentralization.  And  I  have  already

                    directed my staff to study what this means and prepare for me

                    An orderly plan for bringing this about.  I don't look forward

                    to this with any happy anticipation because we have just

                    been through it in Manpower, which we undertook to


                                                                                28

                    decentralize beginning a year ago today.  So, we have

                    ;abundant and ample experience as to what this means, and it's

                    a problem.  And the basic problem is that people don't want

                    to move. And that's no news to any  of  you.  People  just

                    hate to move and many of them will not, and we'll have to

                    help them find other jobs and then recruit people  in  the

                    regional offices to do the jobs that they would have done if

                    ,they had agreed to move.

                              I think about 75 percent have refused to move

                    when we were decentralizing the manpower programs4  I hate

                    it.  I hate it like, everything, but that's the way it is

                    And we'll have to go through with this if we're  going  to be

                    operational a year and a half from now.

                              As far as the people are involved, out of the

                    nearly  @oo in manpower we're-sunn6sed  to move to the regional

                    offices, we did succeed in placihg--the last count I had was

                    something like 5 or 6 out  of 300 we had not been  Able  to

                   @'place.  So, people don't  get hurt except they get very

                    uneasy  and apprehensive and demoralized, and it's a painful

                    thing to go through, but it domes out all right in the end

                    if you can just live  through it.

                              1 could go on shaking my little problems with you

                    for quite a while but I won't.  I am going to  stop now and

                    ask if there are any questions.  I'll certainly try to

                    answer them.


                                                                                   29

                                I know I can count on this council  to  pitch  in

                     and help. You alway have, and there  is  no  concern  on  my

                     part in that regard.

                                MR. OGDEN:  Let me ask you; Dr. Endicott, do we

                     have any authority to  re-establish  the  review  committees

                                DR. ENDICOTT:  It's hard for me really to answer

                     t hat. The only way a  committee  can  be  reestablished  is

                     with'@ the approval of the secretary.  He has the authority to

                     re-establish them, in answer to your question.

                                MR4 OGDEN:  The reason The reason I am raising that

                     simply is that if we are going to be faced with a heavy flood

                     of applications, complicated applications,,  from  the  regions

                     in a very short  etiod of time, it simply physically is going
                                     p

                     to be more than the limited number of members left on this

                     council are going to be able to accomplish.

                                DR. ENDICOTT:  Perhaps I should not  answer your

                     404stion as you put it bUt answer it the way you should

                     have put it. Do we have  authority  to  get  competent  outside

                     advice on  these applications?

                                The answer is I have authority to do that.@ Can

                     we establish the review  committees'  I  don't  have  authority

                     to do that,, and I don't know I would do it if I could, because

                     it's kind of a one-shot proposition:anyway.  lout  we  can  get

                     .,,consultant groups to look at these things and of course we@

                     will.@


                                                                              30

                              MR. OGDEN:  That is really what I had in mind,

                    whether we call them review committees or grouses of

                    consultants or something else.

                              DR. ENDICOTT:  I have authority to convene ad

                    hoc groups, consultants; we do it all the time.  And I don't

                    know precisely what you need.  But as soon as we find out

                    what you need, we'll do it.

                             MR. OGDEN:  Let me ask you another question, which

                    probably should be directed to Dr. Pahl.  How many people do

                    we have left on the staff of RMPS versus what we had before

                    we began this cutback last June.7

                             CHAIRMAN PAHL:  Bob has the exact figure.  I think

                    it's 96.

                             MR. CHAMBLISS:  Ninet -six on duty now.
                                                  y

                             CHAIRMAN PAHL:  Ninety six on duty, and we had 245

                  'prior to phase-out.  And I'm happy to say that the division

                    of operations, which is, as you know,@ the one that interacts

                    with the regions in day-to-day affirs is almost intact.  We

                    have lost a few individuals, but it has been some of the

                    other offices which have been decimated.  So that we are in

                    better position  relatively speaking, within the division of

                    operations than the other units that we had prior to phase-

                    out.

                             DR. ENDICOTT:  We are not confronted with doing

                    all of this sim I with RMP staff.  There are staffs
                                 p y


                                                                              3 1
                    familiar with handling grants in other narts of HRA, and I

                 I  wouldn't hesitate at all to comandeer their assistance if

                    the woz4oad turns out to be impossible to handle with the

                    RMP staff.

                             There are pe  le in the National Center for Health
                                         op

                    Services Research and Development and in the Bureau,of Health

                    Manpower who are old grantsmen, tried and true, and so we'll
                    pitch in.  We can even employ part-time outside help to go

                    over emergency situations of this kind.  So, we are going to
                    be short on professional staff.  what staff we do have is going
                    to have to work like the dickens, and we'll have to improvise.
                    I'm prepared to improvise, you know, do what's necessary.
                             DR. MERRILL:  I think what I have to say is mote of

                    a comment than a question.  But perhaps Dr. Endicott will

                    have a comment on my comment.

                             You addressed yourselves to what I consider a very
                    pressing problem, the need for renovating hospitals in

                    poverty Areas.  And frequently these are the teaching hospitals
                    of medical schools and universities.  I am delighted to hear
                    that this problem is going to be looked at very hard, but I

                    am concerned about one aspect of it which I haven't heard

                    discussed, and that is that in spite of the fact that federal

                    agencies and state agencies may be sympathetic with this

                    problem, the problem itself ends up being blocked at the

                    community level because of the fact that these university


                                                                                  32

                     hospitals, as they have been traditionally set up--and I

                     believe at least in part should be continued to  be  set  up,

                     are not consistent with the immediate  aims  of  the  community.

                     Ambulatory care certainly is one of these.  But at least

                     several hospitals which I know are able and have raised funds

                     for reconstruction and rebuilding, have had their efforts

                     brought actually by the residents of  the  local  community  who

                     feel that those funds are being applied  to  serve,  let's  say,

                     people from other countries or other parts  of  this  country

                     rather than to give total care to the community.

                               Compromises,have been made,, but it remains  a  fact

                     that renovation of good university hospitals,  which  are  10

                     and 40 years old, in spite of efforts at the state and

                     federal level,, have run into severe  difficulties  at  the

                     community level, to.,.which of course state agencies  must

                     be responsible.

                               DR. tNDICOTT:  I recognize the problem. It's a real

                     one.  I've had enough traffic'with  the  university  community

                     to know that it is a real problem in  some  communities,  and

                     the only answer that I can see is that the university is

                     going to have to develop some way to sell  itself  to  the

                     community, and this is hot any  one-shot  propositioh  and

                     requires constant effort. Really it's  kind  of  a  public

                     education effort to make them aware and to  get  their  support.

                              I have the feeling that  from  what  situations  I've


                                                                               33

                    watched, that if the residents in the community can be  given

                    the feeling that the.'university puts a high priority on the

                    requirements of the residents and that is being reasonably

                    taken care of, that they're then much more indulgent with the

                    regard to more far reaching university activities.  But  some

                    of the universities in the ghetto, like Temple, for  example,

                    have had a hard time of it.  It has taken them two or three

                    years really to establish a rapport with the community.  I

                    don't know what we can do at the federal level except

                    encourage universities to put this special effort in.  I don't

                    know of any legislature or anything that will holve this

                    problem.

                              Perhaps you do, and I'd welcome it if you do,

                    because it's certainly a real problem.

                              DR. MERRILL:  No, I would agree with you completely.

                    I don't think there is anything that canbe done by fiat or

                    ,legislation,  tthink--ilt is a probilem'wi:th education.  I think

                    the universities have realized this a little too late, ahd

                    now they are paying'for that tardiness.

                              CHAIRMAN PAHL: Are there other questions for

                  ';Dr. Endicott?

                              DR. FOYE:  Y66,  You mentioned the CHP, RMPI, gill-

                    Burton potpourri. Isn't AHTC going to be in this as well?

                              DR. ENDICOTT:  I mentioned that once in passing.

                              DR. FOYE:  I didn't hear that.


                                                                               34

                              DR. ENDICOTT:  We have not yet done anything

                    organizationally about area health education centers, which

                    has come to the manpower bureau or the--what do  they  call

                    them, SD's?-- experimental health service  delivery  systems

                    which are under the National Center for Health Services

                    Research and Development.  But these are clearly involved and

                    in some communities I think it will be the SD's  which  will

                    finally emerge as the community organization  around  which

                    this will be built. And in those communities,  RMP  and  CHP

                    will probably be collpsed into the SD's.

                              We wanted to make an independent appraisal of the

                    experimental health service delivery systems from the

                    standpoint of their contribution to health services

                    research before slicing the pie.  And we will do that.

                              The area health education centers which were

                    supported out of Manpower--and I don't know what  the  heck
                   ,you fellows called them, but you had a kind of poorman's

                    area health education center that was funded through RMP

                    [laughter], and they clearly both fitted into this thing.  I
                   really-haven'.t quite sorted all this du        But clearly they
                                                           t yet

                    are involved as indeed are some things which the VA has done,

                    and this is an aside,. Of course, one of the  big  problems

                    that has to be faced,.up to at National Health Insurance  is
                    what does this mean with regard to the Veterans Administeratioiio

                  :.and this has been discussed at the top levels in government


                                                                                35

                    and I get a blow-by-blow account, and it changes almost

                    every day as the various people involved examine this

                    complex problem.

                              There has been, so far as I can see, no  thought

                    at least at present of liquidating the VA  system.  But  there

                    has been serious questions asked as to how best  the  services

                    ptovided by the VA should be financed.  Should it be by

                    appropriations out of general revenues or should it be collaps3d

                    into the trust fund operations of the Social Security

                    Administration And this just hasn't been answered.

                              There is an interesting thing which you'll bump

                    into@,tangentially in the coming months, and that is that  the

                    VA has@been authorized to build eight@new medical schools and

                    to provide:some operational subsidy in the field o  hea t

                    manpower. And this sort of runs parallel to or it  may  be  at

                    .cross purposes with the HEW's own health manpower problems,

                    and wdlre still'trying to coordinate and resolve this between

                    HEW and VA.  And since RMP activities certainly impinge on

                    medical schools And graduate education and manpower training,

                    you ought to at least know that they are out there doing

                    something.  I'm not quite sure just what and neither are

                    they.  They don't know what their ap
                                                         propriations will be.

                              I thihk'you have what--twenty-five million?

                              DR. FOYE: Forty-five in  the  House,twenty-five  for

                    the eight new state medical schools.


                                                                             36

                              DR. ENDICOTT:  Anybody who has started a new

                    medical school can tell you $25 million doesn't go very far

                    in starting eight new medical schools.

                             DR. FOYE:  Of course, itis intended it's almost

                    earnest money.

                             DR. ENDICOTT:  Undoubtedly we'll be called upon to

                    put up bricks and mortar money and capitation, and it's a

                    complicated mess.  But there is a fellow by the name of

                    Representative Teague from Temple, Texas, who was determined

                    to have a medical school in Temple, Texas, and this is what

                    finally emerged.

                             DR. FOYE:  This is also the old instant medical

                    school business.

                             MRS. MORGAN:  Can Hill-]3urton remod6lization or

                    construction or whatever it turns out to be really be

                    accomplished if hospitals are still in Phase Four?

                             DR. ENDICOTT:  Well, yes, I think so.  The money

                    I'm talking about is grant money.  It's close to $400 million

                    and, you know, you just give it to them and that's the end of

                    it.  But in terms of loan guarantees and interest subsidy,

                    this becomes more complicated.  And Phase Four has never been

                    intended to impair the institution's ability to amortize
                  @its inde  edness.  It was not intended to erode their
                  lability to service debt.  If it did so, then the Cost of

                    Living Council did it'inadvertently; I'm sure that that was


                                                                                       37

                      never  the  intent.  The  intent  was  to  prevent  inflation  and

                      not to interfere with their paying their bills.

                                 However, anything  as  big  and  cumbersome  as  that

                      sometimes  results in  thing  not  intended,  and  I'm  sure  that

                      you could  quote some examples to  me  where  it  didn;t  work  out

                      just right.

                                 This is@one  of  our  other  anxieties.  I  thought  you

                      had enough to cope with today, so I wasn't going to bring this

                      up.

                                 The Cost  of  Living  authority  expires  the  36th  of

                      April, and there are many people in the Administration,

                      probably a good many oh the Hill too, who feel that some

                      areas of the economy should not be freed.  And of course

                      one  of them is the  energy  area,  which  we  read  About  every

                      day  in the newspaper, and the other    one is the health area.

                      And Congress is going to have to make some kind of@docision

                      in the next six weeks as to whetherlthey are going to continue

                      some form of cost control in the health area or they are not.

                      And if they do, how  are  they  going  to  do  it.  And  the  only

                             7
                      thing   that bothers me jabout it is that  it  might  get  sawed

                      off  on us. 'And that's one task  I'd  just  as  soon  not  have to

                      face.  I'm,h.opeful  that the Cost  of  Living  Council  will   be

                      continued and, if  they  maintain  controls  in  the  health  Area,

                      that those controls will be operated through the Cost of

                      Living Council and we will not be asked to add that to what


                                                                               3 8

                    we are already doing in capital outlay, because  we're  simply

                    not ready to get into the question of rate reviews  and  so

                    on for hospital services.

                              I'm enough of an optimist to keep  thinking  this

                    won't happen to us. But I suspect that  there  probably  will

                   b e some continued restraint in the health area  somehow  even

                    beyond Phase Fotr. I don't know,, but I would guess  that  it

                    probably will.

                              it seems to me that if all restraints  are  taken

                    off and we enact some broader coverage in  national  health

                    insurance, we are going to start an inflationary  spiral  just

                    as sure as the world.  And I hope that we don't do that.

                              The prospects for some form of national health

                    insurance being enacted by this Congress have changed

                    remarkably during the last few months.  People  like  Senator

                    Bennett were talking.about enactment by 1976 just a few

                    weeks before Christmas, and now everybody is blithely

                    talking about enactment by this Congress, which means less

                    than a year.

                              No, cost containment is something that will have

                    to be faced up to.

                              CHAIRMAN PAHL:  Are there other questions from

                   @the Council to Dr. tndicott?

                              Because of the wide range of important  topics  that

                    Dr. Endicott cov6redi Ild,like to take this  opportunity  also


                                                                              3 9

                    to ask whether any members of the public have a specific

                    question* This is an unusual opportunity to get a  survey  of

                    the overall picture of current legislation and all of the

                    RMP aspects which we will be discussing further today, and  I

                    wonder if there are any questions from those who are attending

                    from the public sector.

                              Dt.@Gayei would you please identify yourself for

                    the record.

                              DR. GAYE:  The microphone is disconnected.

                              CHAIRMAN PAHL:  We can hear you pretty well.

                              DR. GAYE:  All right.  I'm Dr. Gaye, the

                    coordinator of the New Mexico Regional Medical Program, and

                    I'd like to ask Dr. Endicott if he would encourage us out  in

                    the field to begin preparations for this new consolidation of

                    these units, CHP, Hill-Burton, and RMP.

                              DR. ENDICOTT:  Yes, sir, I certainly would. I ought

                    to know New Mexico better than I do, because I'm A native  of

                    Colorado but I've been away for a while and I don't know

                    precisely what your situation is there.  I suspect that

                    you're one of those lucky states that won't have too much

                    trouble accommodating to this. Because, you know,  those  are

                    good states out in that area [laughter).

                              But I would certainly encourage you to get

                    yourselves assembled out there and decide what you in New

                    Mexico would like to do.


                                                                                40

                              CHAIRMAN PAHL:  Are there other questions?

                              If not, I want to thank you very much, Dr. Endicott,

                    for being able to spend this greath length of time with us

                    and giving us all of this current information.

                              DR. ENDICOTT:  I hope I didn't waste your time.

                              CHAIRMAN PAHL:  Not at all.  We appreciate it very

                    much.  Thank you.

                              Dr. Margulies is here and will be able to meet with

                    us after the coffee break.

                              Harold, would you like to say anything immediately?

                              DR. MARGULIES:  Shall we have some coffee.

                              CHAIRMAN PAHL:  All right [laughter].

                              Perhaps this would be a good point to adjourn to

                    the cafeteria for coffee and then we'll pick up again with

                    Dr. Dunn's presentation immediately following the break, and

                    perhaps we could come back in 15 minutes and bring our coffee

                    with us, if possible$ because I think we have a full day, and

                    you see some of the things which we'll have to be discussing.

                    So, try to make it 15 to 20 minutes.  Thank you.

                              [At this point the meeting recessed for a coffee

                         break and then reconvened as follows.]

                              CHAIRMAN PAHL:  If we may reconvene, Dr. Margulies

                    can spend a few more minutes with us, and I've asked him to

                    perhaps add a few words to what Dr. Endicott said before we

                    turn over to Dr. Dunn.  Harold?


                                                                              41

                              DR. HAROLD MARGULIES;  Thank you.  I would like to

                    just come down more sharply on a couple of points that you

                    may have some concern with.

                              I would, before I dot it though, like to comment

                    on the fact that I'm pleased to see Dr. Pahl here.  Some

                    jughead from the Blue Sheet commented on his being away as
                    though he was basking   the@sunlight when he's down working

                    very hard on something which very much needs to be done,

                    which is really no joy.  I don't understand how people

                    mana ed to write such nonsense As WAs written on this

                    particular occasion.  I don't think we have any copies left.

                    They'v6 probably been flushed by now4  But generally

                    speaking it's a silly kind of attention getting device.

                              Having gotten that off my mind, let me say a couple

                    of things to summarize more specifically what we can

                    anticipate with RMP.

                              As you know, there is a court order And,, although 1

                    have not seen a copy of it, I understand one has been

                    completed.  I've seen a copy of a signed order or a portion

                    of it, and I Assume that is official by now.

                              Has it been received officially, do you know?

                              CHAIRMAN PAHL:  Mt. Lariman from general counsel's

                    office, could you comment on the gtatus@@of how,long@-we have

                    before thegovernment may appeal for@any modification in

                    that court order?


                                                                                42

                              MR. LANMAN:  We have ten days from February 7th if

                    we do want to try and mandate part of the order.  It is an

                    official final court order at this point.

                              MR. MARGULIES-.  On the assumption that the court

                    order is going to remain as i    as 'been written'@"

                    trying to guess about appeals and so forth, because I don't

                    know about those kinds of processes and I assumed that they

                    are under consideration, it does at least resolve some  of  the

                    confusion about the RMP funds and does provide us  a  clear-cut

                    challenge,in terms of what we do in the future.

                              To summatiz6 what Dr. Endicott has said and said

                    again in response to his questions it is a  general  hope  that

                    there will be an effort to move toward something at  the  state

                    and intrastate level which represents what we have talked aboat

                    over the last several years in this council and elsewhere,

                    and it also represents a political structural move which has

                    been underway for a number of years, even preced ng I th n

                    the entry of the current administration into office and that

                    is a move toward stronger state and local government

                    activities in determining a number of social program

                    directions,

                              If we move as either the bill is in the House

                    would have us move or as the Administration is proposing or

                    as others are proposing, the issues will be joined in some

                    form of planning, in some method for better implementation


                                                                              43

                    of actions based upon planning, and a greater emphasis on

                    regulatory activities than I think most people had

                    realized earlier.

                              One reference was made to regulation as it has to

                    do with construction of new facilities, but there are

                    unquestionably other regulatory activities with which we will

                    be concerned over time.  Cost of Living Council activities is

                    one reference.  But certainly if there is national health

                    insurance, there will be additional regulations.  So, we

                    are talking about what will represent the most critical and

                    influential elements in the future of health care

                    delivery in this country.  It will take place by some merger

                    of current activities, hopefully drawing from the experience

                    in all these programs, RMP, CHP, SD's, AHECS and so forth,

                    and it will depend upon a combination on a collaborative

                    basis of people who have been in planning, in various kinds

                    of implementation in the types of activities RMP has been in,

                    with a much closer tie among those,, between those,, and

                    between that combination of groups and state and local

                    government.

                             It clearly is up to the regional medical programs,

                    as the court order has been written, to take the lead in

                    determining how rapidly and how effectively we move in that

                    direction.  Nobody can force a judgment on regional advisory

                    groupso, o:p@'coordinators, and on,their@@staffs.


                                                                                   44

                               What we have is a clear statement by the court

                     that we return to the practices which were followed prior to

                     1973 and carry out the program as it was  determined  to  be  the

                   .-correc  way at that time.

                               The judge has no reason that I can find to take

                     into account anything which has  occurred  subsejuent  to  the

                     date on which the judge has  determined  an  illegal  impoundment

                     occurred.  What he has said is, "Go   back to where  you  were

                     and start it over again;'and that is A  reasonable  thing  to  do

                     because it was at that point that,  according  to  the  court,

                     the proper processes were dropped and incorrect processes

                     were adopted.

                               We therefore have left a process,  but  many  of  the

                     standards and the benchmarks that we had at that time     have

                     disappeared. quite  clearly  relative  performance  levels  are

                     not@what they were, and yet we  have to perform in  the   same

                     way.

                               We do have a  mission  statement,tihich@was  adopted

                     by this council and which is one of  the  points  of  reference

                     in the court order.

                               Under these circumstances, my own jtdqment--And this

                     is a personal one--I haven't  ccm ar6d it with the  rest  of  the
                                                      p

                                                                               --is
                     Administration, but I know that Dr. Endidott shares    it
                   ithat this decision by thip,court can'be used   to move more

                     rapidly in the direction  that Congress  and the   Administration


                                                                               45

                    wants to go than anyone had envisaged.  It provides an

                    opportunity to work through the re ional medical programs

                    to do things which need to be done and whichi so far as I

                    can tell, the majority of them have long recognized as a

                    sensible direction for them to move.

                              It would be very foolish, however, for us--

                    certainly fo r me--and I think my col eagues here share it,

                    to tell the RMP, the coordinators of the Regional Advisory

                    Groups, that we have now decided how this program ought to

                    be run and we'll explain it to them.  In fact, that has

                    never @een the view of this staff or this council.

                              We have found that regional advisory groups,,

                    coordinators, staffs,, and those with whom they work have

                    wisdom which is applicable to the area within which they

                    work, and have used with great prudence the funds  which  have

                    been available to them, have learned to review and  attest  to

                    the effectiveness of projects, and have begun to develop

                    evaluative techniques which are worthwhile.

                              They know more about CHP "B" agencies than we'do.

                    They live with them.  They know relatively less about state

                    and local government than they ought to, but they  know  that,

                    and that varies from region to;region.

                              And what I am saying essentially is that we ought t

                    work as rapidly as we:dan towork,with and  through  the  RMP's

                    with the fu  s available to do the job that needs to  be  done


                                                                                  A.C

                     if there is agreement that that's what the job is.

                               There are some practicalities  which  are  involved

                     in this too. As Dr. Endicott indicated,  the  court  says  the

                     money needs to be ogligated. obligation  means  that  we  must

                     have decided that the RMP's will receive that  money  in  some

                     kind of manner consistent with past practices  so  that  it's

                     available to them to use.

                               It also says that we can't put  it  out  there

                     tell them you can't spend it yet.  The  court  order  cl

                     prohibits that.

                                 e court order also says that  you  can't  put,that

                     money Out there and restrict the kinds of  things  for  which

                     it can be used so that it delimits other than  has   been

                     agreed to prior to February of  1973.  In  other  words, we

                     can't put it out there and say it's all there  but   you have

                            d it bnl                 decided recently is a good
                     to speh        y on   which we

                     idea.

                               So, we're,pretty much back in business  as  well  as

                     we can be to do things the way they had been before.    Clearly

                     this money needs to be exp6nded over a  long  period  of time

                     than would have been the case if it had been made  ava  an,  e

                     in the year in which it was originally appropriated or at

                     least in which the Appropriation Act was proposed and a

                     continuing resolution was put in place.

                               So, the June 30th date has no meaning as it had up


                                                                              47

                    to the present time,, excepting as the court determined that

                    those funds needed to be obligated.

                              I regard this as an,opportun ty for organizational

                    and administrative collaboration, innovation, and probably

                    on the part of the RMP's themselves a level of high

                    diplomacy and compromise, so that they find that what they

                    have achieved over this long period of effort has a firm

                    base in the future but hot of necessity representing

                    exactly the things that they intended to do in 1971 or 1972,

                    a new direction and a new purpose.

                              If there is to be a national meeting of the

                    coordinators, and I believe that there will be and should

                    be, I feel a little uneasy, and I'd like to have your

                    advice to Dr. Pahl and the others on this, about trying to

                    have a meeting as early as next month, with all the

                    coordinators and probably some RAG representative as well as

                    those from CHP "B" agencies, SD's, and so on.  We are much

                    more likely to have an unwieldy number of individuals with

                    diverse views.

                             I think we heed to move more rapidly to areas of

                    reasonable agreement at different points and then come

                    together very rapidly.

                             But, so far as I'm concerned,            r  nt,,,.,,
                                                                    @,u

                    issue is to act At the level of state and loca activity as

                    rapidly as possible so that in every state where that


                                                                              48

                    appears to be desirable on the part of the RMP'S, CHP'S, and

                    others, there is a quick meeting and a beginning of

                    negotiations to bring together government, providers,

                    planners, in what will represent a new form of implementation,

                    planninq,implementation and regulation.

                              I am confident that that is going to have to

                    develop in a different way, accootding@tolthe states in

                    which we work,and according to what their habits are,

                    dependinq'upon how much regulation they have already

                    experienced.7dependin
                                        g upon what their resources Are.  That

                    is the nature' b'f'RMP and CHP in the past.

                             I think it would be very foolish to try and

                    prescribe the manner in which this should be done.  But I

                    do think that we are going to have to do that promptly,, if

                    the money to be made available between now and June 30th is

                    to be used as effectively as possible.

                             Please also note that the tourt order has

                    responded to the plaintiff suit on FY 074 funds and indicated

                    that they also may not be impounded, that they as appropriated

                    must be expended under the same system and with the same

                    constraints as for the impounded funds of FY 173.

                             In essence, what the  have said is, "You shouldn't
                                                 y

                    @have impounded last year, and you may not impound this year,,"

                    which is fairly clear.  That means that there will be a

                    significant amount of money available to the RMP's to expend


                                                                              49

                    in judicious ways..  I see nothing more to add to those

                    statementsi

                              I think you understand the dynamics.  What does

                    concern me is the extremely short period of time which is

                    available to do what requires a high level of imagination.

                    The main benefit which we have had--and I suppose from every

                    kind of wandering from the true path there is some benefit--

                    is the fact that the regional medical program leadership has

                    remained intact, coordinators have talked with one Another,

                    they are close to the movements of legislation, they do

                    "understand the purposes of these combinations, they do

                    recognize that national health insurance is coming along,

                    and they have remained available at all times.

                             And, as Dr6 Pahl has pointed out, the key members

                    of the operational staff rmeain here and a good many other

                    people are available.  This to me represents a real

                    opportunity and one which was not anticipated but can be

                    utilized in a highly effective fashion,  I hope that's the way

                    it will happen.

                             CHAIRMAN PAHL:  Thank you, Harold.

                             Are there any questions on these points?

                             I would have one--I believe it's a correction to

                    make which has to do with the interpretation of the court

                    order which you have not seen.

                             The fiscal 174 funds must be obligated in full by


                                                                                  5 0

                    June   30th,  this June 30th.  There is no question about that.

                    The fi
                           sc,#4@,5@,,17 funds are not required to be obligated by

                    June   30th, but we would make every effort to  do  so,  because

                    the wording is  such that the government is  directed  to  take

                    such administrative action as is necessary  with  such  speed  as

                    is administratively feasible to implement the awarding Of

                    the full appropriated sum for RMP for fiscal 173.  So, we

                    don't really have stated in the court order that  it  has  to  be

                    June 30th for the fiscal 173 funds, but I think it's quite

                    clear that the intent is to take actions as quickly as

                    possible with whatever administrative requirements there are

                    in this regard and certainly I believe we will try to

                    accommodate both the fiscal 173 and 174 funds by this June

                    30th.

                               MR. MARGULIES:  Part of the time he has been

                    spending has been in a short course in practical law.

                               MR.,LANMAN: If I could just add  to  what  Dr.  Pahl

                    saidi he is absolutely correct as far as the court order

                    saying with such administrative speed  as  possible--or  I  guess

                    administratively feasible, whatever the exact words.  However,

                    by,law the PY 173 funds are available  for  obligation  at  the

                    federal level until February 7,  1975.  So,  they  are  available

                    for obligation for that long, and that's  by  reason  of  secti

                    501 of 9345, the supplementary appropriations act, which

                    says that when you get a court order  relative  to  '73  funds,


                                                                              51

                    those funds are available for one year from the date  of

                    that court order.

                              CHAIRMAN PAHL:  Thank you very much, Mr. La=an.

                              MR. LEMKE:  Mr. Lemke from Wisconsin.  In view of

                    the fact that it's very urgent that action be taken

                    immediately and also in view of the fcat that Or. Endicott

                    mentioned the'need for decentralization--and also in  my

                    experience, every time you move you lose your files  for

                    about two or three years--and adding to that a comment that

                    a large share of out decision process is already at  the

                    local level their own regional medical programs and in their

                    regional advisory groups, what would your evaluation of the

                    necessity Of decentralizing the Washington staff be.

                             CHAIRMM PAHL:  The decentralization that

                    Dr. Endicott is referring to is decentralization from
                    headquarters to the regional offices.  And I thi@,k the  6int
                                                                           p

                    is that this is a federal initiative for all programs, and

                    certainly it is a major initiative in the health programs.

                    And, as he indicated, it's a question of when and how it

                    will be carried out.  So, I think it would be somewhat

                    inappropriate for me to comment on the advisability of it.

                    That decision has already been made.

                             we will decentralize.  The question is, How will

                    this be done and the timing of it?  And we have had some

                    discussions in recent weeks with our staff which have


                                                                               52

                    indicated that this is coming but I believe I heard this

                    morning that perhaps it's a little more imminent than I for

                    one had antici ated.
                                  p

                              We will work do make this as orderly as possible

                    and to try to make it as effective as possible, and I'm sure

                    we will have the full su  O'rt ofIour agency to give us some
                                            pp

                    guidance in this matter, because certainly all decentraliza-

                    tions don't work well, and wO'll try to benefit from Prior

                    experiences.

                              MR. MARGULIES: I don't think that  the  question

                    of decentralization will be an issue in the very rapid

                    kinds of activities which have to take place as they affect

                    RMP functions in the next several months.  I doubt that that

                    will occur.

                              on the other handi if there is to be as much

                    decentralization of responsibility and function to state and

                    1 ocal government as we anticipate, then it makes no sense

                    for some programs to be highly decentralized, others fully

                    decentralized, and none not decentralized at all.

                              I am hoping that the real decentralization which

                    will occur will be from one kind of government to another.

                    In other wordso from federal to state. I have  never  felt

                    that decentralization to a regional office is enough;  but

                    the decentralization should be extended beyond that, which is

                    the direction we're now moving.


                                                                                53

                              MR. CIIAMBLISS:  I think I should make the

                    observation to the staff that about three weeks ago  when  we

                    had our staff briefing on the proposed new  legislation,  I

                    did make the observation that Dr. Endicott's views  were  that

                    tRA should be a model for decentralization, and it's  sort  of

                    inherent in that whole point, that I think this discussion

                    about decentralization of RMP is taking place.,

                              CHAIRMAN PAHL:  We'll come back to some more of this

                    in my report to you. But I'd like now to turn  to  Dr.  Marvin

                    Dunn as the Deputy Director of the Bureau of Health Resources

                    Development in this agency.  As Dr. Endicott  indicated,  bur
                    program has been moved from its former bureau position and

                    under Dr. Van Hoek into this new bureau, the  third  bureau

                    of the Health Resources Administration. And  Dr.  Dunn,  as
                    :Deputy Director, would like to say a few words,concerning the

                    bureau And the reorganization that has Occurred.

                              DR. DUNN:  You'll notice on the  agenda that  I'm
                    down to speak for a very few minute, very  briefly, and  I'll

                    try to do that.

                              There are two reasons why we said this  would  be

                    very brief.  One is that we knew Dr. Endicott would cover the
                    major details, which in fact he has. And the  second  one  is
                    That organizational arrangements in the federal  qbverrment

                    are a little bit like the esoteric subatomic particles.

                                                                        detail4
                    People that deal with them describe them in great


                                                                                  54

                     They write about them and fill the journals.  But in real

                     life they seem to last for a very brief millisecond.

                               What I am going to tell you about the organiza-

                     tional structure is as it was yesterday.  I have not

                     received word yet today that it has changed, but before your

                     meeting is over, in fact it may change again.

                               I have put on the blackboard a  very  brief  outline

                     of the organizational structure of the Bureau of Health

                     Resourc6s Development.  It's actually very simple in

                     concept in that the residuum of the Bureau of Health Manpower

                     Education is now represented by  four  categorical  divisions,

                     the Division of Medicine, Nursing, Dentistry, And Associated

                     Health Professions.

                               The Associated Health Professions include allied

                     health, optometry, podiatry,  veterinary  medicine,  pharmacy,

                     and public  health.

                              The intent actually was to put these into a center

                     but we@'@re told that the Public Health Manual on organization

                   @doesn't allow us to do that.  So, we're doing it functionally

                     but not.structutall    And there will be an associate
                                       @y.

                     director for Health Manpower who will be responsible for

                     integrating these@cateqolrica'l divisions into a functional

                     entity; hopefully it will be somewhat reflective  of  the  way

                     health care  should be delivered in An integrated and

                     coordinated fashion.


                                                                              55

                              Likewise the initial intent was to have a center for

                    health resources planning, and likeise the manual didn't allow

                    that center either.  So, we had a division for CHP and one

                  Ifor Ifill-Burton which is called facilities utilization.  And

                    more recently with the activities for integrating health

                    planning, we said there is no need for a special act of

                    Congress to integrate the functions of RMP, CHP, and Hill-

                    Burton. We can do this on a functional basis, and  it  was

                    for that reason that Dr. Endicott said that RMP would be now

                    viewed in this bureau for such purposes.

                              Mr. Eugene Rubel has been named as the Acting

                    Associate Director for Health Resources Planning.  And  it's

                    his responsibility in that position to move the three  units

                    toward aft integrated form or more appropriately an integrated

                    function, because we don't know what the form will be  until

                    the legislation actually comes out.

                              To finish off, as Dr. Endicott mentioned, many  of

                    the bureauls programs are decentralized to the ten HEW

                    regional offices, and we have an associate director for

                    operations; Dr. Harry Bruce is in that position. -And  his

                    office serves as the major link then between the bureau  and

                    the ten HEW regional offices for ordinary grants and  policy

                    coordination.

                              I have put the names of the individuals who  are

                    the division directors if these are of interest to you  at


                                                                                   56

                     the moment, and I don't want to give you more detail about

                     the organizational structure than you'd  really  like  to  have.

                               Let me stop at this point and see if you have any

                     questions and remind you that Gene Rubel is  going  to  be  here

                     this afternoon and will go into whatever  detail  you  would

                     like to go into in terms of the proposed legislation that's

                     in the hopper,, what the AdministkAtiot's proposal  is,  and

                     what the thinking is at  this.point in time for  moving  in

                     that direction.

                               MRS. MARS:   Once these three  ar  integrated  though,

                     who would run them or  who would direct  them?  Would  there

                     be A person taken from what section, in other words'.>

                               DR. DUNN: No decision  whatsoever  has  been  made

                     in that regard.

                               MRS. MARS:  Are you talking about the Department

                     of Health or where would it come from, in other words?

                               DR. DUNN: We don't know what  the  form  and  the

                     structure of the unified health planning  program  will  bei

                     for example, at the area, the regional, the state, And the

                     'national level.  We know that whatever it is, that in order

                     to work; we are going to.hav6 to draw on  the  strength  of

                     the current RMP's,dentrally and in the  r6gionsl  CHP,  and

                     Hill-Burton4

                               Therefore, an effort must be made At this time to

                     sustain the strength of these organizations as they now


                                                                                   57

                     exist.  And so there will be no attempt to integrate them

                     formally in a structural way now.  And we'll make those

                     decisions when we see what sort of organizational pattern

                     should be developed.  No one has been preselected to head

                     this up, I can assure you that.

                               MRS. MARS:  Yes, but I was@just wondering where
                     the director would come from, whether there  was  any  idea  at
                     all or any coftception.what.,type of person would be chosen,-

                     who is going to dominate there, in other words, is what I am

                     saying.  Somebody is  4oin@ to dominate, CHP or RMP.
                                               9

                              'DR. DUNN:   I really doubt  that anyone in  that  job

                     is going to dominate. He would  have  to  have  the  skills,and

                     the combination of Jesus Christ and Henry Kissinger and a

                     few others to work this out [laughtdr].

                               CHAIRMAN PAHL:  Are there any other questions?

                               Thank you very much, Dr. Dunn.  All will

                     accommodate, none will dominate [laughter].

                             ,-'MRS. MARS:  That sounds very nice too.

                              CHAIRMAN PAHL:  Well, you see life remains

                     interesting.

                              Let me go on.  We have quite a full day and 'we
                     don't want to take too much time.  We have several reports
                     which we want to get to in just a moment.  But let me

                     mention one or two things which came out of this mokning's
                     activities.  obviously with the court order being signed oh


                                                                              5 8

                    February 7th,,with an appeal by.the government being

                    possible up to February 17th, we have chosen not to

                    distribute the "final" court order to you, because it  has

                    ben our expe rien6e this past year that every time we

                    distribute something which is final, we have to come  back

                    and give you another xerox copy.

                              So, we will wait until Mr. Lanmah advises us that

                    all hurdles have been overcome and when we have what  is

                    truly the final one, which may be in hand At the moment,

                    then we will send to you the exact wording. You  have  the

                    intent of that court order, and we'll be glad to give you as

                    much interpretation as we can at the moment.

                              But with the assumption that the court order  as

                    written is what will stand as the final order,, we are being

                    called upon before June 30th to oblioate the remaining '74

                    fiscal funds, which approximate $32@millibn.  We are called

                    upon to obligate with all deliberate speed the  released

                    fiscal 173 funds which approximate $55@million.

                             As Dr. Endicott and Dr.  Margulies  both,either

                    stated directly or implied, we are At this stage not quite

                    where we were prior to the phase-ott. We do not  have  a

                    review committee, but we will use outside consultants as a

                    prelim nary review body prior to the next meeting of  this

                    council for the review of applications  hich we will request

                    regions to submit to us.


                                                                                59

                              the court order says that all funds from 173 and

                                                   .. ... . .... ..
                    174 will be obligated, and that is our intention.  Therefore,

                    we will have to ask regions to submit proposals whose sum

                    will exceed what it is we had to  distr 41bute so that if there

                    are decisions by the  council of an adverse nature in  one

                    region or another, there will be suffidient  proposals  to

                    account for all the funds that we have to make available to

                    the regions.

                              We have a number of admifiistra tiVe problems

                    internally which we haven't brought to you, and I don't

                    think I will. But there are certain things  as  space  and

                    personnel dislocations which tend to keep things a little

                    bit confused internally.  And so we will have a very buy time

                    over the next few months.

                              In this regard, I would like at this point I think,

                    therefore, to indicate to you something about the scheduling

                    without at the same time trying to pretend that either

                    Mr. Ch @ liss or I have all the answers for all  the  many

                    questions that are going to have to dome up over the next

                    few months.

                              It seems,, first of all, that to have the  March

                    coundil meeting as we had originally scheduled  for  March

                    12th and 13th, is not particularly appropriate, and I would

                    like to cahdel that meeting date.  We won't have any

                    applications for you to review.  And we think it's too close


                                                                               60

                    to the present meeting for us to have that much to bring

                    before you.

                              It has been suggested by staff, who have given

                    c onsiderabl,e thought to these questions,, that perhaps a

                    rescheduling of the  M.arch meeting to March 26-27 might be

                    appropriate, if that could be accommodated by your

                    schedules.", And the reason for that--16t me just proceed a

                  bit--is because  during this interim since we last met, there

                    has been an  agreement between RMP8 and the steering

                    committee of coordinators to hold a national meeting of

                    coordinators on March 5th and 6th.  That had been scheduled

                    for Dallas, but apparently this may be able to be shifted  to

                    the Washington area in order to accommodate the schedules  of

                    some of the agency People, such as Dr. Endicott and

                    Dr. Margulies.

                             I think that we have to reconsider that date for

                    a moment, because Dr. Margulies is a rather key individual

                    in such a meeting, and I learned this morning that he may

                    just be getting back from his own official trip to Russia

                    about the same time that national coordinators meeting  would

                    occur and since that meeting is not just to deal with RMP

                    activities but is to concern itself with CHP, RMP, AHECS,

                    Hill-Burton, and so forth, it would Seem that it's very

                    important to make certain that we have the deputy administrate

                    or the administrator present for a good portion of that


                                                                                    61

                     meeting because it is the goverrment's position that will     be

                     of interest to those who come to such a meeting.

                               So, at this point what I would like to suggest is

                     that we try to determine--and I'd like to have some advice

                     from you as to what dates might be appropriate in your

                     calendars, but that we reconsider, Bob, the March 5th and

                     6th meeting after welrd able to determine whether

                     Dr. Endicott or Dr. Margulies in fact can be present.

                     Because, if not,@th6 meeting wouldc.,truly suffer.  Too much is

                     going on at high levels that must be imparted to those that

                     make the trip and' spend the time in',Waghington and it would

                     be necessary for that.

                               So, we will have to reconsider the March 5th and

                     6th  Meeting.  We would, however, like to say here that we

                     would hope that all of you as council  members  could  make  All

                     or a portion of the meeting whenever it is to occur, and

                     we will inform you as soon as we can clear the calendar for

                     that national coordinators meeting.  So, you have that

                     invitation and if hew council members  are  appointed  prior  to

                     that meeting, then we will extend that invitation to the

                     new council members also.

                               With regard to the council  meeting  dates,  it  would

                     seem to me appropriate to have a late  March  council  meeting,,
                     and the staff has suggested that Marcly@  6-27"Iniqht be a  good
                     time.  This would not be to take acti6rt-@-"ol.h--any applications

                     but merely, if you will, to review and provide advice--and


                                                                                 62

                    we sorely need advice--as to how to proceed over the coming

                    months in terms of policies and directions.  And we don't

                    know exactly what dates are best to  have,a  meeting,  but,that

                    seems to be'ono  that.thd staff felt was appropriate.

                              I'd  like to have an expression from you as to

                    whether those su  gested dates fit in@vkith your calendars.
                                    9

                              MRS. MAPS.-  I think it's all right for  me.  I  came

                    off stupidly without my  diary this morning.  nut as far as

                    I can remember, it's all right.

                              MRS. MORGAN:  Fine with me.

                              MR@'. HIROTO-.   is there any difficulty in

                    scheduling these meetings for say Monday and Tuesday rather

                    than Tuesday and Wedh6sday?

                              CHAIRMAN PAHL:  There is an internal difficulty,

                    but that can be resolved. The internal  difficulty  has  to  do

                   with such things as unavailability of xerox  machines  over  the

                    weekend, the things that control our  lives.  But  that's  very

                    minor, and TI@m sure the government can find a way to unlock

                    machines for us.  There is always a lot of last-minute

                    preparation work which is difficult over a weekend when you

                    are part of a bureaucrac
                                            y.  But let me say that we will

                    Arrange the dates to fit your convenience, not ours.

                              MR. OGDEN:  I want to speak to this point again

                    as I have beforei because coming from the West Coasto this

                    takes three days of my week.  And indeed by the time I come


                                                                                 63

                    back on Thursday morning, my desk.is loaded and the only

                    effective day that I have in the week is Friday.  So, to come

                    to this meeting takes in effect four days out of my week.

                    If I can fly east on a Sunday
                                                    go to a meeting here on a

                    Monday and Tuesday, I get more effective time, and I cannot

                    take the kind of time away from my business that this type

                    of meeting schedule begins to require.

                              My time is fine except for the week of the 18th of

                    March at which time I cannot be out of Spokane because of the

                    annual meetings of my company.

                              CHAIRMAN PAHL:  Let's go back and ask about Monday-

                    Tuesdayi which would be March 25-26.

                              'MRS. MARS:  I know Monday is no  good for me.

                              CHAIRMAN PAHL:  Monday is no good for you?

                              MRS. MARS:  go, because I'll be  in California and

                    I know I'm not coming back until the 27th.

                              DR. MERRILL:  I'm afraid I'll be in Peru.

                              CHAIRMAN PAHL: Yo@u don't sound disappointed.

                              That eliminates Monday, I think, from an effective

                    meeting.  I'm hot sure that we need a two-day meeting.  That

                    is another matter.  And perhaps if we just had it on one 0

                    the days, that would help matters if we had to hold it  not

                    on Mon day this time, although we would try to accommodat6*

                              MRS. MARS:  What about moving it then to the end of

                    the week, to the 28th, Thursday the 28th  and Friday the 29th?


                                                                                  64

                     Would that be of any help?

                               MR. OGDEN:  If it is going to begin the morning of

                     the 28th, I have to start flying on the morning of the 27th,

                     during the day of the 27th.

                               MRS. MARS:  Have it Friday the 29th, and then if

                     necessary work Saturday morning.

                               CHAIRMAN PAHL:  Friday  the 29th?

                               MRS. MARS:  With the i    @.t
                                                             t it could be extended

                     to the 30th.

                               CHAIRMAN:  Let's set Friday the  29th  and  Saturday

                     het3Oth.  And as we get closer to the point, we will be able

                     to inform you from our point of View whether it  will be

                     necessary to move over into Saturday.  But  please  keep  both

                     the 29th and 30th of March open then.

                               MR. CHAMBLISS:  I think the council should know we

                     are getting used to working saturdays.now [laughterli

                               CHAIRMAN PAHL-.  That implies something.  I don't

                     think it's true.

                               I'd like to look at the June council schedule

                     possibility, because this is the time in which we will have to

                     ask you to take action on the review  and  recommendations  on

                     applications. This is where the business  end  of  the  fiscal

                     year will be accomplished, and the  staff  has  suggested--Ahd

                     again this can be modified,I'm certain--they had suggested

                     June 5th and 6th.  The way we arrive at out dates, which are


                                                                               65

                    suggested to you, is to back up from our workload of

                    deadlines, of obligation documents and so forth and arrive at

                    that point which seems to be as late as we can hold a council

                    profitably. But again that's midweek,  Wednesday,  Thursday.

                    And we can move it either way in the week,, but it would be

                    preferable, I suspect, to move it earlier than it would be

                    later.

                              So, here is where a Monday, Tuesday perhaps  could

                    be accommodated, again it your calendars would permit,:and

                    then we'll make the necessary arrangements here to fit  that

                    in.

                              MR. OGDEN.-, It may be an,impossibility for me.

                              CHAIRMAN PAHL:  That week as a whole.

                              MRS.@MARS:  I just don"t know.

                              MR. OGDEN:  I say that only because I am the

                    chairman of the board of a school that will hold  graduation

                    ceremonies that week  and I am deeply involved in several

                    activities that will occur during that week.

                              MRS. MARS:  I've got a granddaughter graduating that

                    week from high school.

                              CHAIRMAN PAHL:  Perhaps since some of you don't

                    have your calendars and there seems to be something hero,,

                    let's--

                              MRS4 MORGAN: Can we schedule the June  meeting  in

                    March, or is that enough time to get into the FederAl


                                                                                 66

                     Register?

                               CHAIRMAN PAHL:  It's enough time to get it in the

                     Federal Register.  It's a'matter of the simple expedient of

                     reserving rooms and things of that nature.  And, of course,

                     we may have new:council members,by that time.  Perhaps what

                     we should do is get in touch with you about the June meeting,

                     because we will have to have that.  That will be a crucial

                     meeting because we will be deciding on the allocation of

                     the  funds.

                               MRS. MARS:  Can't we decide in March on that?

                               CHAIRMAN PAHL:  Yes.  I think as soon as we get

                     new council members we had better make the decision on

                     the June council meeting, because one just doesn't get meeting

                     rooms,in Washington in June that easily.  It's really quite

                     complicated.  And I think we will hold this off then for a

                     little bit.

                               MR. CHAMBLISS;  Can we get the date that would be

                     acceptable to most?

                               CHAIRMAN PAHL:  We can get the date that is

                     acceptable to most, but Mrs. Mart doen't have her calendar

                     and that week is out.

                               MRS. MARS:  My mind is just absolutely blank about

                     it.

                               CHAIRMAN PAHL:  Do you have any problem?

                               MRS. MORGAN:  I have no problem.


                                                                              67

                              MR. IIIROTO:  I don't know when my son graduates.

                              DR. MERRILL:  I'm all right in June.

                              CHAIRMAN PAHL:  We'll be in touch with you in the

                    next day or two to get your calendars, and then we'll fit that

                    in as best as we can with new appointments that we do expect

                    to come through hopefully quite soon and then arrange a

                    meeting date.,

                              In terms of other,reports, and I'd like to move

                    along rather@quickly, we have two:activities that have been

                    going on which we'd like to describe to you in just a bit more

                    detail.  Dr. Endicott referred to legislation that had been

                    introduced as well as the Administration's position.  And

                    'in our organization Mr.  Peterson has been intimately

                    involved with a task force and part of a larger group within

                    the agency in looking at the legislation which has been

                    introduced and also the Administration's yet to be introduced

                    bill.  And I've@asked him if he will please summarize that for

                    us and also treat in a very brief fashion An important facet

                    of the emergency medical services legislation which is very

                    important that you understand, because it places a

                    restriction on what RMP's will be able to do in the future in

                    this particular area.

                             So, Pete, if you will give your report, and then

                    we will have a report on the arthritis centers.

                             MR. PETERSON:  As Dr. Endicott indicated, there has


                                                                              6 8

                    long been talk about the merging of CliP and RMP, and we are

                    now beginning to see some legislative reflection of that.

                    We will be handing out to you copies both of the one bill

                    which has been introduced and a summary of it, which is a lot

                    easier reading.  It's four versus 66 pages.

                              At I indicated, to date only one bill has been

                    introduced, and that's House 12053.  Essentially the best way

                    to describe this briefly is, I think, in terms of the new

                    sets of institutions that it would propose creating and the

                    panoply of functions that those institutions collectively and

                    individually would be responsible for.

                             The bill,has four basic parts and in a sense would

                    create four new sets of institutions, or three, depending on

                    how you look at@Hill-Burton.  It would establish a national

                    council on health policy in the executive office of the

                  @'Presidently modeled After the Council on Environmental

                    Quality, a high-level, prestigious, full-time council.

                             It would establish at what we think of now as the

                    areawide level a series of organizations which this bill calls

                    health service agencies which in a simplified way reflect sort

                    of an amalgam of RMP and CIIP i

                             it would also create at the state level a set of

                    institutions called state health councils and in addition it

                    would establish or re-establish or modify some kind of

                    construction program.  I'm not sure whether Hill-Burton


                                                                               69

                   survives as an anstitution. That's why I said three  or  four.

                             Among them, these several new sets  of  institutions

                   have I think an expanded range of functions and  authorities

                   beyond what the 6xisting,agenci s have had.

                             For example, there is provision for the establishmen-

                   of national health policy, whether that's real or  not.  But

                   certainly it envisages a single voice in  that  regard.  There

                   continues to be a planning function.  It provides for

                   certification and recertification of all health services  at

                   the local and state level.

                             It envisgaes that the health services agencies,  for

                   example, would have review and approval authority  over  grant

                   proposals coming under the Public Health Service Act and

                   several other acts; so that instead of the old review and

                   comment authority, there would be review and approval

                   authority.

                             There is provision for health  services  development

                   or implementation, that part which I suppose is most  akin  to

                   what RMP has been up to in recent years. And there is  a  good

                   deal of regulation both as it relates to certificate  of  need

                   for facilities but also at state option rate review  and  rate

                   setting.

                             In one sense, I suppose, it's a good bill in  that

                   it tends to raise most of the important issues that, it  seems

                   to me at least, require some debate and discussion.  In  other


                                                                                70

                    ways it may be less of a good bill, but at least  it  gets  a

                    lot of the issues oh the table.

                              As Dr. Endicott and others have indicated, it seems

                    quite certain that there will be other  bills.  There  is  an

                    Administration bill that we have been told that we could

                    anticipate for the past two or three weeks.  But I think

                    clearly there is going to be  an  Administration  bill.  From

                    what some of Us have seen of earlier versions of it, it will

                    probably be quite similar in many of the salient aspects.

                              It does not, on the other hand--or it did not--

                    provide for a national council on healt)l,,p6licy.  It  would

                    treat Hill-Burtbh in a separate piece of legislation.  There

                    are--I'm sure there will be--a lot of differences  as far  as

                    nomenclature is concerned and@Als6 as far as many  of the

                    particulars are concerned.

                              We're Also likely to  see a bill along these  lines

                    introduced in the Senate,, probably by Kennedy and Javits.

                    But again I stopped holding my breath waiting for that one to

                    be dropped in the hopper.

                              we also are likely to see, because this  bill  that

                    has been introduced in the House by Representative Rogers on

                    behalf of himself And representatives Roy and Hastings, I

                    think does not necessarily reflect what each of them as

                    individuals would necessarily like to seOl but it was  a  way

                    of getting something oh the table. And  it's  quite  possible


                                                                                    71

                     that one or more of them will be introducing so-called

                     unified health planning bills that are more closely akin to

                     what they would like to see.

                                I'd like to say a few words about the prognosis for

                     this   area of legislation and when and in  what  form,  and  in

                     doing so  I think I ought to throw  out  two  caveats.  One  is

                     that   this is my best professional  judgment.  I  have  tried  to

                     keep my personal biases out of it.  And, secondly and

                     perhaps more' importantly, I've been wrong  be  ote4  So,,  on  t

                    b et  on  it.

                                It's ihtetestinq@to note, I thinki as an Aside to

                     this   that both the CHP's--and now Ilm talking about the

                    agencies@out there--as well as the RMP'S, and the best I can

                     ascertain most other groups, are taking  a  sort  of  wait  and

                     see attitude.  They want to see a range of bills put on the

                     table before they officially  comment  or  commit  themselves  to

                     suppot  ng or opposing specific bills.  And that has been

                     made explicit; certainly by  the  RMP  Steering  Committee  and

                     Executive Committee; that doesn't mean that individual

                     coordinators may not  have  specific  opinions  about  specific

                     pieces of legislation or specific aspects of it.

                                Similarly I think to date we  have  seen  very  little

                     supporter opposition expressed in terms of the one bill that

                     has been introduced.  There was some sort of vague

                     statement--that's my word--there was some sort of statement


                                                                                7 2

                    by the AAMC that I interpret as being generally supportive of

                    the Rogers Bill.

                              On the other side  of the fence, the Association  of

                    State and Tdkritorial He6lth  Offices, I gather, are very

                    upsets to put it mildly, by the Rogers Bill.  But there

                    haven't been many people who have chosen sides as yet in this

                    because it is a single bill.

                              As I say, this is my judgment and  really  reflects,

                    more a synthesis of what I hear other people iayingl sometimes

                    by devious channels and a lot of them by  indirect  channels.

                    But I question whether there will be legislation Ohacted

                    this session, certainly not by June 30th, I think.

                              But we will really have a better idea of that in

                    a mont h or six weeks time. If we see a wide  range  of  bills

                    laidlou'ti  think that,may be a signal about some things.

                    When the Rogers Committee decides to begin  holding  hearings

                    on this particular legislation may also be a clue as to

                    whether we're likely to see legislation this session.

                              As I@hAve already indicated, at least my  basis  for

                    this judgment, it is my judgment, we haven't seen  any  really

                    strong@consensus emerge on a specific piece  of  legislation.

                    I think there is a great deal of general consensus  in  terms

                    of the direction in which most people would like to see things

                    go.  But there has been no strong consensus certainly

                    expressed in terms of the Rogers Bill, a particular  piece  of


                                                                              73

                    legislation.

                              The Congress I think everybody recognizes has a

                    busy agenda this year in addition to things like energy,

                    what to do about the Economic Stabilization Act or at least

                    aspects of controlling prices as it relates not only to

                    health but petroleum products.  That's on their agenda.  In

                    the health field, as Dr. Endicott has indicated, we have a

                    national health insurance proposal from the Administration.

                    That's clearly going to be on the agenda.  Almost every piece

                    of health authority in HRA expires.  Manpower, et cetera.

                             So, the Congress generally and the health committees

                    specifically have got a tremendous workload, and it remains

                    to be seen how much of that they get sorted out in any

                    substantive fashion this year.

                             Finally I think, you know, it is an election

                    year.  The Congress will be trying to get home as early or as

                    frequently as possible, and my own sneaking suspicion is that

                    in many areas where they pan safely defer taking action on

                    what may prove to be controversial, they may be particularly

                    sensitive to that this year.

                             But, as I say, that's my prognosis, that I question

                    whether--I think the odds are less than fifty/fifty that

                    there will be a bill enacted this year.

                             What form legislation will take, whether it's

                    enacted this year or early in the next session, again I think


                                                                              74
                    the only safe prediction I could make is that there will be

                    a number of changes.

                              Some of the areas which I think invite a good deal

                    of debate and difference of opinion is the extent of

                    regulation, whether planning and implementation are to be

                    the responsibility of a unitary entity or whether separate

                    entities with some kind of enforced interdependence will

                    emerge I think is another area where there will be considerable

                    debate and difference of opinion.

                             The whole method by which funds get allocated,

                    whether matching is required and,, if so, to what degree.  The

                    matter of a national council on health policy.  The

                    authorization levels, I'm sure, will differ between the

                    Administration and the Congress's bills*

                             And even such prosaic things as the designation of

                    geographic areas, I think these are all aspects on which I

                    foresee that there are quite likely to be'q@hanges in a number

                    of these areas.  So, in shot, I think it's very difficult at

                    this juncture.to proclict,that ther@e@@will either be legislation

                    or what form it will take this year.

                             I think there clearly isl,'on the other hand, a

                    direction in which we're moving and we're likely to see

                    legislation'if not this year,next year, along these lines.

                             CHAIRMAN PAHL:  Maybe we should have questions on

                    this before discussing EMS.


                                                                                  75

                               MR. PETERSON:  Yes, I'll cover EMS.

                               Are there any questions?

                               You have basically a summary of the proposed

                     legislation. I would point out  in  the  interest  of  detente

                     we gave you the summary that the American Association of

                     Comprehensive Health Planning put out.

                               CHAIRMAN PAHL:  We thought that was tactful.

                               MRS. MORGAN:  You gave us credit.

                               MR. PETERSON:  Yes.  Oh, yes.  I thought it was a

                     good summary.

                               Besides it was one  I could find last night for
                                                        ATP
                     xerox.  1 couldn't find John  Muetetdals-summary.  Like   most

                     @things, it's arMatttk of expediency.

                               CHAIRMAN PAHL:  This will be the matter of lots of

                     discussion and will of course be focused on in the forthcoming

                     coordinators meeting as well as our own council in March.

                     So# perhaps we might move on,, Pete, and have you highlight an

                     important aspect of  the emergency medical services

                     legislation.

                               MRS. MORGAN: How  long  do  they  have@to  introduce

                     -,bills in this session? Is there a period of  time  at  which

                     bills can no longer be introduced?

                               MR. PETERSON:  Technically  there  is  not.  On  the

                     other hand, the way the committees and subcommittees operate,

                     you start dropping bills in the hopper in May And June yot--


                                                                                  76

                    unless it is something extraordinary--that's why I think

                    the next month may give us some better clues about the

                    likelihood of some enactment this  year.  Bedause  I  think  any

                    bill in this area probably to get full consideration are going

                    to have to get dropped in the hopper in four to six weeks.

                    That will take us up to almost the first of April.

                               MRS* MARS:  In the governing body here, it says

                    one  third  consIumers, one third providers, one third public

                    elected officials. In the one  third  providers,  what  is  that

                    going to consist of?  Does it say that there are so many

                    physicians, so many physical therapists, and  so  many  this  or

                    that?

                               MR. PETERSON:  No, it does not, Mrs. Mars4  It does

                    define provider, the bill does, but it does not in effect

                    sub-allocate @among physicians, allied health versus hospital

                    administrators or even for that matter public health

                    officials.

                               MRS. MARS; t)oes that mean that in  other  words  out

                    of these people that there could only be one physician, for

                    example?

                               MR. PETERSON:  The !pill wouldn't prescribe that4

                    I think you touched upon an area which at least from feedback

                    I've had in places where--

                               MRS. MARS:  I would think this would be a very

                    serious concern, that physicians would not be able to--


                                                                               77

                              CHAIRMAN PAHL:  This will be part of the debate.

                              MR..PETERSON:  This will be part of the debate.

                    I think another part of the debate is that one third

                    consumers. CHP has had a majority of consumers, and  I  think

                    one can anticipate that there will be some--they see that  as

                    a reduction.  I think we've hit upon an area of some of the

                    specifics and detail where I think it's almost i  ossible  to
                                                                    MP

                    predict other than that there are going to be some voices

                    suggesting other ways of doing it.

                            DR. MERRILL:  I'm interested in the fact that the

                    HSA will review existing health services on a certification

                    need basis.  And also I am corresponding with the state

                    health commission.  Have the state health commissions--are

                    ihey in accord with this?  The state health commission in

                    Massachusetts is very jealous of this prerogative, and I am

                    .not sure how they would react to an HSAL no matter how

                    constituted, reviewing 6xisting--particularly existing--health

                    facilities and making recommendations to them.

                             MR. PETERSON:  Not only is it existing but it

                    calls for recertifaction, which even if it did not include

                    existing, it would at some future time be a review of

                    existing.

                             I don't know enough about the state health commissio

                    in Massachusetts, Dr. Merrill, to know whether it is the or

                    would become the kind of state health commission that is


                                                                                   7 8

                     envisaged by this bill.  Clearly there are a number of

                     agencies at the state level who  presently  have  a  purchase,

                     small or large, on certain functions which are now by federal

                     legislation being prescribed in  a  state  health  commission.

                     Certificate of need legislation is not always in CHP "A"

                     agencies*  There are state insurance commissions.

                               So, you know.  And I think this is one of the

                     reasons why the state health officers, as best as I can

                     ascertain, are not very happy with the legislative

                     proposAl', because if you look at it  closely--which  I  don't

                     suggest you do now certainly--there is not much role for

                     them.   And I think that is part of a longer term trend.

                               MRS. MARS:  Have they defih6d consumers in it?

                               MR. PETERSON:  Yes. Whether you like the definition

                     or whether you think it's a good  definition,  most  of  these

                     things have been defined.

                               Well, I wonder in view of the time if it might not

                     be just as well--because I would be glad to answer some other

                     questions on the side as we break for lunch or coffee, if I

                     have any answers, because'I don't pretend to have many

                     answers, and talk very briefly about the EMS Act of '73.

                               As@@youll,l recall, there had )been EMS  legislation

                     passed by the Congress, vetoed by the President among other

                     reasons because a rider had been put oh for the continuation

                     of the PHS hospital.  But subsequently a compromise was


                                                                                 79
                    worked out and Public Law 93-154 was enacted November 16th,
                    which did authorize Ems and $160 million over a three-year
                    period*  And, indeed, in the supplemental appropriation act
                    for 1974, there was a supplement of $27 million voted for

                    EMS.

                               That bill, while it includes authority and funds
                    for a variety of things, feasibility studies and planning,
                    the establishment of the initial operation of EMS systems,
                    research, and even indeed some traininq--it modifies Title 7

                    of the Public Health Service Act.

                              There is buried in it, and 1 must confess I didn't
                    notice it in November--nobody bothered calling it to my
                    attention and perhaps it was because they didn't notice it
                    either  or they w'6'ren't talking about it--section 1206(e),
                    which reads, and I think I will read this:  "No funds

                    appropriated under any provisions  of,this act other than
                    section 1207 or,Title 7, which. is health manpower training,
                    may be used to make a new  grant  or contract in any fiscal year
                    for a purpose for which a  grant  or contract is authorized by
                    this titlei unless (1) all the funds authorized to be
                    appropriated by section 1207 for such fiscal year have been
                    appropriated and made available for obligation and (2) such

                    ne  grant or contract is made in accordance with the
                    requirements of this title that would be applicable to such
                  lgrant and contract if it were made under this title,' and then


                                                                               80

                    it goes on to make some definitional things.

                              It appears now that this--and I remember some

                    advice my.mother gave me--she said, "When you don't know and

                    aren't certain, say so."  Really, I am not going to give

                    you a definitive legal opinion.  But it appears that this

                    would tot permit RMP funds to be used to support any new

                    EMS Activities, and I would underscore new.

                              I think that may,provide a loophole in the sense

                    that, As you are well aware, we have been and the RMP's have

                    been supporting and continue to support a number of EMS

                    activities, most of which were begun late in June of 172 as a

                    result of that,@special emphasis.  And to the extent that

                    they are in a,se-@ c6nd or third@c6htinuat'ion year that had

                    been envisaged initially, I would @think'that is'llpe'r'missible.

                    I sus ett that it@'would,b@e'desirable to get a definitive
                        p

                    and most favotable,legal opinion.  By most favorable, it would

                    be defining new in a way that would permit the continuation

                    not only of certain RMP activities, because I would hasten

                    to point out there are any number of other programs who have

                    been supporting EMS-lik6 activities, certainly in the

                    National C6nter for Health Services R and D.  I suspect

                    some of the experimental systems' activities have.  I know

                    there has been some CHP support, at least in some planning

                    and what have you.  But we are faced here, it seems to me,

                    with a situation because of the passage of this act, that


                                                                              81

                    has some significant implications for future RMP ap
                                                                      ,plications

                    and indeed council action.  I certainly hope that one of

                    the things, even by March,much less by the time the  RMP's

                    and this council have to take action, that we can do better

                    than I have in interpreting what this really means.

                              But it does seem fairl Y' clear that to start a new

                    EMS activity under this or another program at this point in

                    time would be in contravention of this section.

                              It's highly unlikely, I understand, that the

                    $27 million that was appropriated for this fiscal year will

                    indeed--they will indeed be able to obligate it, that is, the

                    EMS program, which is now part of the Health Services

                    Administration.

                              CHAIRMAN PAHL:  We wanted to bring this activity,

                    this possible restraint on EMS activity, to your attention

                    because it had escaped us, with all the other things going

                    on.  And it would appear that we need a definitive legal

                    statement, an opinion., on this.

                              But if the interpretation that common sense places

                    on this, we,will not be init iating new,EMS activities as long

                    as funds appropriated under the EMS legislation  are  still

                    available.  And this therefore would modify some of the

                    Proposed activities@t hat regions would engage in  with  the

                    funds that have been now released from either 173  or  174

                    impoundments.


                                                                              82

                              Thank you, Pete, very much.  And I find whenever

                    we got into the legal side I usually find that my statements

                    are somewhat in error, and I think Mr. Lanman wants to add a

                    point here, as general counsel, to discuss just one more time
                    the court order and perhaps we have more freedom to give you

                    information than I had anticipated.

                             MR. LANMAN:  Yes, I want to point out that we do

                    have a final court order, a matter of public record; it's a

                    final court order entered by the Unitdd States District Court

                    for the District of Columbia.

                             The only way that that order can be changed is,

                    number one, if the losing party, us,, the government, decides

                    to appeal.  We have 60 days in which to file an ap
                                                                     peal to a

                    higher court, the Federal Court of Appeals for the District

                    of Columbia.

                             In view of what you've heard here this morning as

                    far as theadministration willing to comply with the main

                    requirements of the order, as far as releasing the funds, I

                    think an appeal is highly unlikely, and as far as I know it's

                    not being contemplated either from An administrative viewpoint

                    or from a legl viewpoint.

                             The other means by which this order might be
                  Ichanged is! if the go vernm6nt would seek to file in the
                    federal district court, the court that entered the order, a

                    motion to altar or@amend that order.,


                                                                              83

                              The only reason we would do this would be for the

                    purpose of clarifying a minor point that is unclear and we

                    are not sure how to proceed under the order or if there is a

                    particular part of that order that we feel we cannot comply

                    with, we would file a motion to alter or amend that small

                    part of the order.

                              That motion under the Federal Rtles of Civil

                    Procedtre must be filed within ten days after the date of the

                    final order.  Now, that normally would make the motion due

                    on February 17th, but due to the fact that February 17th

                    falls on a Sunday and February 18th falls on a holiday, that

                    motion would not have to filed untal February 19th.

                             In all honesty I must say that such a motion is

                         discussed, but there is at this point no final word on

                    it again either from a legal standpoint as to whether we shoull

                    file such a motion or from an administrative standpoint.

                             So, I guess what I am getting at is I believe the

                    order we have here can be distributed and it should be

                    considered as the final order until and unless it is,chanq6d.

                             I might say that the motion to alter or amend is

                    entirely within the discretion of the district court.  There

                    is no guarantee of any kind that they will change what they've

                    said so far.

                             So, therefore, I think we have to assume that this

                    is a final court order until subsequent events prove


                                                                                      84

                     otherwise, instead of assuming  that  this  is  an  interim  order

                     and that it probably will be changed later4

                                CHAIRMAN PAHL: I  am  happy  to  stand  corrected,  and

                     I think we should distribute what  that  order  is,  Ken,  if  you

                     have copies, to council  members.  We  just  wanted  to  save  you

                     from receiving too many pieces of paper.  But I think I

                     appreciate better the status of it, and we'll give you copies

                     so that you can see the wording of it.

                                I would like t o have you turn your attention

                     however, if you would, not to that piece of paper but to some

                     comments first from Mr. Chambliss and then secondly from

                     Mr. Matt Spear, dealing with the activity that is      now going on

                     in RMP c6c6tninq the development of a program for      arthkitus@

                        ters. And just let me turn it over to Bob, who       has been

                     very active  in this and give you a bit of@an introduction

                     within a status report by,Mr:. Spear.,, wh64has  been  heading  up

                     the activity  for us,

                                MR  CHAMBLISS:  Very  shortly  we  will  be  presenting

                     to the,6ouncil  a proposed resolution concerning arthritis

                    'Attivities.   And to prepare you for that proposed resolution,

                     I think it in order that you hime something of a brief

                     background as to how this came about.

                                Under  our  current  appropriation  legislation,  there

                     is phraseology to the effect that regional medical programs

                    would engage in the planning and development of pilot arthritis


                                                                                 85

                    ,centers up to $4.5 million.  In that appropriation the total

                    sum is shown as $81.9 million for fiscal 174-  And of that

                    @$81.9 million up to $4.5 million will be used for planning

                    and developing these arthritis centers.

                               MRS4 MARS:  Before you go any further, may I

                    interrupt and say what are these  arthritis  centers  for?  Is

                    this treatment> What  is  this?  Education,  clinics,  what?

                              MR. CHAMBLISS:  Very key question and, if I may, I

                    will come to that very shortly.

                              Oh last Saturday the RMP key staff  held  a  meeting

                    here in Bethesda with members of the National Arthritis

                    P6undation, with key people from  the  foundation,  together

                   with-two Regional Medical Program coordinators, Mr. Paul Ward
                    of California and Dr.          Chat      of the *in Regional

                    Medical Program, and the purpose of that meeting was to

                    d iscuss what was the meaning of the term  "pilot  arthritis

                    centers.11

                              We did not fully work it through to  what  we  meant

                    or what was meant by pilot arthritis  centers.  But  we  did

                   ,arrive at these points.  Number one, that it would n6t--they

                    would not include intensive research activities.  Number two,

                    that the centers would not engage in continuing medical

                    education and the further education  of  interns,  residents

                    or fellows in arthritis.  And that the centers would not

                    engage in intensive efforts in delivering patient servidds,


                                                                               86

                              MRS. MARS: Then what, in the  name  of  goodness,

                    are they going to do?  what's left?

                              MR. CHAMBLISS:  But that they would work through

                    the RMP's and improving access, availability,   improve@the

                    delivery, improve patient and physician education activities

                    as to a basic awareness of the magnitude of  the  arthritis

                    problem in the country, with the view that  better  patient

                    care could be delivered.

                              MRS. MARS-.  I should think every physician in the

                    country would know that.

                              MR. CHAMBLISS:  That certainly is a general

                    assumption, but even the arthritis experts admit that that

                    is not the case.  These are clinical entities in arthritis

                    and rheumatoldgy that have by and large not been forthrightly

                    treated and explored by the professional community, the

                    clinical community.

                              And these centers will support activities around

                    this particular,cateqokical area and, as a consequence, it

                    is hoped that there will be greater public, patient, physician,

                    community, hospital, clinic awareness about these conditions

                    and the magnitude of them throughout the country.

                             DR. MERRILL:  Could I interrupt you just a moment.

                    It seems to me it's awfully important, At least for me,, to

                    know what thelcenter is not.  It's not a new physical facility

                    is that ri ht?.'
                             jg


                                                                                 87

                               MR. CHAMBLISS:  I might say that the arthritis

                    foundation is supporting already what it considers to be a

                    number of centers numbering approximately 42.  They vary in

                    size, in scope, in what they do, in staffing, in emphasis,

                    and the arthritis foundation would like us to begin working

                    around as many of those centers as possible.

                               I am simply laying a groundwork for what  Mr.  Spear

                    will be saying, and he will come on with further details.,

                               Dr. Pahl calls to my attention that there  has  been

                    involvement of the National Intitutes of Health, the

                    Institute for Arthritis and Metabolic  and  Digestive  Diseases.

                    @They have been involved in the overall planning for this

                    effort,and Matt will develop that further.

                               CHAIRMAN PAHL:  Matt, why don't you go ahead.

                               MR. SPEAR: It may give some meaning to  some  of  the

                    comments which Mr. Chamblits made to review  just  briefly  with

                    you what the problem is.

                               Arthritis is a generic term meaining that  it  covers

                    in a very broad manner  some 80 to 100 diseases about which

                    very little.,is known and none of which can  be  prev6hted4  It

                    affects about 50 millioh'people in the country.  Twenty

                    million of those'are affected seriously in terms  of  pain  and

                    crippling,  The major diseases being rheumatic arthritis

                                                                    Only@gout   can
                    gout,, osteoarthritis, ankylosing spondylitis.

                    be treated to the complete point.


                                                                                  88

                               What remains that can be done is that pain can.

                     be reduced and the claim is made and it his been made

                     consistently for some ten years or more, so I think it can

                     be substantiated, that if the therapy is instituted early

                     enough in the course of the disease, they can prevent

                     crippling.

                               Now, that's quite important in terms of the number

                     of people we're dealing withi because arthritis is the major

                     crippler in this country, and is second only to heart disease

                     in terms of causing disability, days in b@'6d, days away  from

                     work.

                               opposed to this problem  are some needs.  The

                     American Rheumat6logy Association  lists some  2,000@to  2,100

                     members, but they  open their@membership to everyone who

                     wants to be a member.  So that at best count there have been

                     identified only about  500-to  600  rheumatologists  practicing

                     in the country.

                               Most of the people in the field are in research and

                     a very small number, relatively, are out providing care.

                               Arthritis has not been popular as a medical career.

                     It isn't taught in every medical school, and@there aren't

                     many people out in the medical community who  have  a  current

                     relationship with an academic or practice approach to

                     arthritis.

                               The result is that only 20 percent of these


                                                                               89

                    millions of patients that I noted to you have ever seen any

                    physician about their disease and only three percent or four

                    percent of those patients have ever been looked at by someone

                    trained in rheumatology.

                              Because of these factors I've suggested to  you,

                    there is a great frustration, a resignation that nothing can

                    be done about arthritis, and the resignation seems to be as

                    great on the side of the physicians as it is in the patients.

                    And this is what needs to be overcome.  We need to get the

                    patients into the channels of therapy that will first,  if

                    I may put some priority on these matters, give them a sense

                    that something can be done and then in the proper hands

                    arrange for those things to be done.

                             Now, it's more than just going to see  a  rheuma-

                    tologist or, depending on the disease, going to see an

                    orthopedist. Arthritis in its various forms  is  systemic.

                    It will create very serious system problems.  It is in many

                    cases a whole body disease.  It requires a wide variety in

                    its complications, a variety of specialties to deal with it.

                             So, given the factors that I have suggested to youi

                    again we have a problem of how do you bring together the

                    kind of medical teams that are required, and health teams that

                    are required, to deal with these problems.  And the evidence

                    is that the--which is not a new one as we all know in  the

                    chronic area certainly--that@physicians and surgeons and


                                                                              90

                    therapists and social woraers and nurses have not  necessarily

                    been communicating together too well. And the low man  on  the

                    tDtem pole aspect of arthritis prevails in the allied health

                    diseases in many respects.

                              So, there is a sizeable problem to overcome.,

                              The four and a half million that was stated in

                    the Senate language represents perhaps a larger change than

                    may be apparent because of its size. Since the demise  of  the

                    old National Center for Diabetes and Arthritis, programs

                    under the Chronic Disease Center some years ago, there has

                    been only research money, at least from the Public Health

                    Service, going into arthritis activity.

                              The NIAMD research activity in this area has run

                    between twelve and fourteen million dollars in the last

                    several years, and that's per year.  The current year:

                    estimate as about thirteen and a half million.  And that is

                    going in mostly for laboratory work and the training of

                    research people. So, there has been nothing of any  size,  and

                    particularly if one recalls that the old D and A program was

                    not a long-lived program, there has been nothing to Contribute

                    in a continuing sense to any creation of community program,,

                    community delivery program.

                             And I think it has been quite a pleasant surprise to

                    me at least that the rheumatologists have come to the

                    conclusion themselves that this is their greatest need and


                                                                              91

                                                          They want to help build
                    this is what they want to reach for.

                    referral patterns.  They want to develop outreach.  They want

                    access for the patient to have care.  They want quality of

                    care.  And they want to build a multidiscipline approach.

                             We have a very short time.  These funds fall within

                    that qroup that must be obligated by June 30th.  As

                    Mr. Chambliss has suggested, we have had some intensive

                    conversations with the experience represented in NIAMD.  We

                    have counseled with the steering committee of the coordinators.

                    We have counseled just this past week with the Arthritis

                    Foundation.  we are in contact with the Academv of orthopedic

                    Surgeons and a-@variety of the@associations of the allied

                    health people.

                             in fact upstairs the initial draft of the guidelines

                    is being typed.  We hope to have them reviewed retyped,,

                    reviewed, retyped, whatever it takOgl and mail the guidelines

                    out next week.

                             By May 15th we have to have those applications in

                 I  here for staff to look at and to prepare for your 60ri6idera-

                    tion.  There are obviously a number of things that the

                    regions@have to accomplish, and we have Asked the arthritis

                    people to dohVey to their constituents that the way to start

                    the ballgame is to get in touch with the RMP, because that is

                    the channel through which the program will be administered as

                    we now see it.


                                                                                      9 2

                                 CHAIRMAN PAHL:  Thank you, Matt.  This is one of

                      those activities which came to us in a bit of a circuitous rotte@

                      There had been a request by the arthritis foundation to place

                      Additional monies in the appropriations for the NIH, and

                      this eventually did not work out, and through a series of

                      steps which I don't think I have to recount at the moment,

                      the monies were placed in the RMP legislation, which is

                      really quite appropriate, because the purpose of the centers

                      it to provide the outreach and not just academic centers

                      restricted to research and teaching.  And we have the test

                      of this fiscal year, as Mr. Spear indicated, to develop the

                      criteria, work through the RMP's to get applications in for

                      the establishment 6f'a small number of such centers, to have

                      thet6 reviewed by a special panel, much as the emergency

                      medical services program was developed, and then to have the

                      recommendations of that scientific review panel come     before

                      this council again at the June counc'l meeting so that an

                      award for the arthritis centers up to a total of $4.5

                      million              this fiscal          And Mr. Spear is in

                      charge of coordinating'our interest    in this with what has

                      already'@been initiated by the  NITI  throughItits own separate

                      arthritis institute programs   as well as  the interest and

                      professional capabilities-of   thos6,   o are involved with the
                                                 7

                      arthritis foundation.

                                And we will be submitting to you the various kinds


                                                                                  93

                     of documents materials,,, criteria,@ and so forth, as  they  are

                     developed. This is just one other  little  aspect  that  has  to

                     move ahead this fiscl year, and you can see that it is a very

                   worthwhile activity and we are working very hard to do an

                     effective job, biit it is complicated again with the resources

                     that we have to place on it in  this  particular  time  frame.

                               MR. OGDEN: The only comment  I  would  make  is  that

                     I would hope that in the guidelines  as  they  are  developed,

                     some mechanism is established for  the  continuing  support  of

                     these. If we start them, I should  hate  to  think  that  this

                    Wm simply a oh6-shot  thing.  We  have  no  statutory  authority

                     to go on At least at the moment for@the  support  of  this,  as

                     I understand it, for other funds.

                               CHAIRMAN PAHL: We have  only  the  statements  in  the

                     appropriate              and we have a draft resolution    wh3ch

                     perhaps should be distributed at this moment if   it hasn't

                     already been, Ken, which is very brief,, which we  would   like

                     to have you consider, which doesn't s  eak  to  this  point,that
                                                           p

                     you just raised, but it would strengthen the p6int4

                               MR. CHAMBLISS:  Mr. Ogdenr if I might say,this,

                     there is legislation contemplted for  the  support  of  these,

                     once they are underway.

                               I understand that there is A great amount of

                     interest on the part of senator Cranston  in  this  area,  And

                     the arthritis people are looking  forward  to  support  beyond


                                                                               94

                    that support initially provided by Regional  Medical  Programs.

                              MRS. MARS:  Are we going to build buildings with

                   this money or are we going to use it for staffing facilities

                    that already exist?

                              CHAIRMAN PAHL: This is not for  the  construction  of

                    physical facilities, but it's primarily used for  staffing  and

                    program activities, and I think, although I was unable to

                    be present at the Saturday meeting where basically there was

                    a small group present from both the NIII, RMPS, and representa-

                    tives of the arthritis foundation and professional community

                    in the arthritis area.

                              I think there certainly was, according to

                    Mr. Chambliss' statement, an indication of the need to have

                    these centers be rounded programs which would engage  in  those

                    kinds of activities, apart from the provision of direct

                    services.

                              DR. MERRILL:  Having spent A year of research in

                    such an outfit,, I know they do not only research and training,

                    but they also take care of patients.  And if 1 were to

                    envisage what center meant, without wanting to put words in

                    your mouth, it would mean enabling such an outfit to expand

                    their patient cake facilities.  Physical plant, all the backup

                    people, would already be there.  What these funds should do

                    would be to en  l@@them to  take care of more patients.

                              CHAIRMAN PAHL:  We are trying to build on the


                                                                                  9 5

                     expertise--and Bob may want to elaborate on this in just a

                     moment--but we are trying to build on the expertise that

                     has been developed through the NIH support of some 30 centers,

                     what they now call centers, and which is open to serious  uestior

                     because of the magnitude and diversity of activity within any

                     one of those programs.  But we are trying to build on that

                     expertise and would basically envision expanding and

                     strengtheniho and extending some of those existing "centers."

                     And this is as close to an interaqencv activity as we have

                     gotten to for some time,..  And perhaps, Bob, you should

                     mention who was at the meeting and the representation, so

                     that it will really indicate our interest in working with

                     what is already available.

                               MR. CHAMBLISS:  Yes, the whole concept is to,build

                     on what is Already there and to augment the resources that

                     are already in existence.

                               In attendance at that meeting was Dr.

                     Los Angeles, who is the past president of; the American

                     Arthritis Foundation; Dr. Duff, from Ann  Arbor, Michi an
                                                                            9

                     who now heads, the last center funded by the old Chronic

                     Disease Bureau; Dr. Dedker from the National Institute of

                   I Arthritis and Metabolic Diseases and Digestive Diseases;

                     Dr. Shulman from J6hhs'-HO'pkins, who,is prd.sent president of

                     the Arthritis Foundation; Dr. Weiss from New Orleansi who is

                     an outstanding rheumat6logist; and,mr. Shobe, who is the


                                                                               9 6

                    liaison representative for the foundation having an office

                    in Wasington and an office in New York.

                              Also in attendance, as I mentioned before,, were the

                    two regional medical program coordinators.

                              I think I should add one footnote that, being of
                    the opinion that the Veterans Administration has perhaps the

                    largest reservoir of arthritis patients, wd,did seek to

                    impress upon the-group that where And wh6n possible
                    collaborative efforts should be made with Veteran Admihistra-
                    tion facilities.@@, I@thought,lyould like to know that  Dr. Foye.

                             CHAIRMAN PAHL:  I think what we will try  to do is

                    as developments proceed--this has All been very recent on us

                    also--we would like to keep you informed,, and we would

                    particularly appreciate if one or more members of the council

                    would like t-o@@be in attendance at meetings where the develop-

                    ment of@such@icritekia and discussions are held.

                             W6 very frankly have been--and this is in part due

                    to my absence--have been running extremely hard in a number
                    'of elections, and I think it's amazing that as much progress

                    as has been made has been done with a variety of inputs over

                    the recent six weeks.

                             So, we would like to extend an invitation to have an

                    expression of your interest now,or in the future, of keeping
                    apace with this apart from the formal council meetings,-and if

                    one of you or one of the council members who we believe will


                                                                                  97

                    be appointed in the near future wpuld@like to take a specific

                    interest,  will meet.  Because these applications will be

                    coming to  you this June, and we will not ask  you  to  do  the

                    initial review, but  there will need  to be  an  understanding.

                    We will try to keep  you apprised of  all the steps  as  we  go

                    along.  And this was just an initial   meeting to  try  to  get

                    better understanding ourselves of  what  the  NIH  had  already

                    done, as well as the arthritis  foundation,  because  it's  from

                    there that the stimulus for the introduction of the four and.

                    a half million obviously arose.  So,  we  are  trying  to  find

                    out what their thoughts wbko. And  now  that  that  meeting  has

                    been held, I think were in  a position to superimpose the

                    RMP philosophy, and we are  intending to make these awards

                   through the RMP's to arthritis centers, so  that  the  local  RMP

                    is and remains involved in the activity  and  is  not  bypassed.

                    We think that's crucial to the outreach which we are trying to

                    have in these centers.

                               MRS. MORGAN*.  Could we have a list of where the

                    centers are?

                               CHAIRMAN PAHL: Y6s.  We'll  put  together  a  package

                    of those materials which seem to  bring  together  the  salient

                    points that have developed this far and send  to  all  of  you,

                    the list of the centers, the participants at the   meeting, and

                    anything else that may have come out of that meeting at which

                    I wasn't able to be present.


                                                                                  9 8

                               MRS. MORGAN:  Prior to this, it seems so much of    the

                     work on arthritis hat been on the adults, and it's really

                     such a crippling of children.  The Veterans Hospital is here

                     again adults mainly.   Very, very little  has been done for

                     children.

                               MRS@. MARS:  Is there a schedule already put up

                     for the meetings in the future, Mr. Chambliss?

                               MR. CHAMBLISS#.  Yes, we have a tentative schedule

                     that we will be working against to get all of the instructional

                     materials out to give the regions an  opportunity  to  respond,

                     to get them back in for review, and to get them before you in

                     June so that awards can be made before the end of this fiscal

                     year.

                               MRS. MARS:  I would like to attend any of the

                     meetings that I could, but I don't know whether I'll be here.

                     I was a governor of the arthritis foundation at  one time.  So,

                     I wn particularly interested.  But I just don't  know if   I'll

                     be here, you see, when these meetings Are held.

                               CHAIRMAN PAHL: Let us get  this  information  to  you

                     as quickly as we can, and then it is an open invitation not

                     only to you but to other members of the council as well to

                     attend.  We need assistance in a number of areas over the

                     coming months, and we certainly need your understanding.  And

                     it has just been a very rapid pace, and I think a lot of

                     credit should be given to both Mr. Chambliss a
                                                                    nd Mr. Spear for


                                                                              9 9

                    moving ahead so quickly in an activity which came to us very,

                    very late in the fiscal year;  But it is moving along very

                    well, and we're trying hard to have an effective program

                    with a limited number of centers and building on existing

                    knowledge and expertise from the NIH support programs.

                              MR. OGDEN*.  In connection with this resolution,

                    I come back again to the point that I made before.  This is

                    a limited amount of money in one appropriation bill.  But

                    t he resolution that we have sounds like it's a broadly based

                    resolution in which RMP monies in general are going to be

                    :Made available for this purpose.

                              I would be happier if we had a resolution that

                    simply said something like the Congress has earmarked in

                    connection with--if that's the bill, 93192--certain RMP funds

                    for the planning and development of a pilot arthritis

                    program so that we,can resolve this with the paragraph that

                    to the extent that funds have been appropriated for this

                    function, because that's as far as we really can go, qhldss

                    we--and under the court order I assume we can't go back now

                    and plug someding in that wasn't there in February, 1973.

                             CHAIRMAN PAHL:  Thai is my understanding of the

                    court orders

                             MR. OGDEN-. So, we coul6n't go back and take money

                    for FY '73 or@inde,ed even for FY 1740, and turn it over to

                    arthritis how..  So, if you want to say that the Congress is--


                                                                                 100

                                CHAIRMAN PAHL:  It has all been in the 174 funds,

                     and it never was in the '73.

                                MR. OGDEN:  So, if we wanted to say whereas

                     Congress is earmarking in connection with PL 93-192 certain

                     RMP funds  for planning and development  of  pilot  arthritis

                     programs.,@be@-it resolved@th,6 National Advisory Council  of

                     Regional  d@dical  PrIograms recommends that activities in the

                     field of arthritis be r6do hizod for support under Title 9
                                                9

                     of the Public Health Service Act to  the  extent  that  funds

                     have been appropriated for this function.

                                If you will make those chahgesp I  will  move  the

                     resolution.

                                CHAIRMAN PAHL:  All right.
                                                                amended resolution

                     has been m6ved4  Is there A second?

                                MRS. MORGAN:  I second.

                                CHAIRMAN PAHL:  It has been moved and seconded.  Is

                     there further discussion.

                                MRS.' MARS:  Do you want to read it again.

                                MR. OGDEN:  What I have written, it says, "Whereas

                     the Congress has earmarked in connection with PL 937    2

                     certa      P funds for planning and development of  pilot

                     arthritis  programs, be it resolved that the National

                   Advisory council on  Regional  Medical  Programs  recommenIds that

                     activities in the field of Arthritis be recognized for

                     support under Title 9 of the Public Health Service Act to the
                                                                                   v  i


                                                                            101

                    extent that funds have been appropriated for this function.

                              CHAIRMAN PAHL:  Any further discussion  Judy?

                              MRS. SILSBEE:  Mr. Ogden, would the motion that

                    you're making preclude a:regional medical program whose

                    RAG wanted to put some money into arthritis  from  doing.that?

                              MR. OGDEN:  I think it would.  I think we've got

                    four and A half million we can use for that purpose, as I

                    understand it.  They would have to make an application for

                    that particu ar four and a half million or part of it.

                              CHAIRMAN PAHL:  These are for the pilot arthritis

                    centers. This apart from putting dollars into those  kinds  of

                    studies and acativities, I should think, that may lead to

                    that.  But this is a pilot arthritis center program, and my

                    interpetation is that they would have to come under the four

                    and a half million dollars, using fiscal '74 funds.

                              MR. OGDEN:  Do you want to call it pilot arthritis

                    center program and put the word "center" in there?

                              MR. BAUM: This resolution came out of  the  Saturday

                    meeting that we had last week, and it really came out of A

                    suggestion that was made by one of the participants, and

                    nobody was certain of the exact circumstance.  But somewhere

                    back in the beginning of RMP, either Administratively or as

                    the result of council action or'somethinq which no  one  really

                    recalls right now, it wa s apparently determined that

                    arthritis was not one of the related diseases under the RMP


                                                                               102

                    legislation which speaks of heart disease, cancer, stroke,

                    and related diseases.  And that since the Congress had

                    now specifically appropriated funds for  arthritis,  we  felt--

                    the group thought, I shouldn't say we--that it might be

                    appropriate to recognize arthritis formally as a related

                    @disease. That was the intent originally of  writing  it  this

                    way.

                              CHAIRMMI PAHL:  Thank you.

                              Bob?

                              MR. CHAMBLISS:  I think the substantive part of

                    your question, Mr. Ogden, as I see it, is that  can  a  region

                    engage in pre-existing arthritis activities separate  from

                    this particular legislative language; and the Answer   tO,,.that

                    to me would seem to be yes, it can.  It cannot engage  in   the

                    development and planning of@pilot  arthritis  centers  but  it

                    could engage if there are pre-existing--th6re may be preexisting

                                 or proposals already in the AMP's for arthritis.

                    Are you suggesting that those could not come in  in  a  package

                    beyond--

                              MR. OGDEN-.  I think we've got,to separate it out of

                      is, because welke talking apparently about a particular

                    piece of legislation, and this relates to planning and

                    development of pilot arthritis center programs, as I understand

                    it.  So, I'm willing to have that come before this council to

                    the extent that funds have been appropriated for that


                                                                            103

                    function.  But I don't think we want to take other RMP funds

                    and use them for the planning and development of pilot

                    arthritis center programs.  That's all I'm saying.

                             We've had programs at some point or another, as I

                    can recall, that have involved arthritis one way or another

                    from regions.

                             CHAIRMAN PAHL:  This is a very.specific label--

                             MR. OGDEN:  This is a very specific thing.

                             CHAIRMAN PAHL:  --pilot arthritis center program.

                             MR. OGDEN:  And I think we ought to restrict it to

                    the money that's in that bill and not make it sound like

                    wd're going to look at a wider range of things.

                             CHAIRMAN PAHL:  Is there further discussion?

                             Mr. Lemke?

                             MR. LEMKE:  Do I understand correctly  that if,thore

                    is no center existing in a region, that we could not begin any

                    work?

                             CHAIRMAN PAHL:  Not under this particular program,,

                    no.

                             MR. CHAMBLISS: Let me see if we'are together here.

                    Your question was, If there are no centers existing in a

                    region, could you begin Work under this provision!  And my

                  lanswer is that yes, you could@begin,@,to develop proposals and

                    they would have to compete with all the others.

                             MRO OGDEN:  That's different from the comment you


                                                                                10  4

                     made before.

                               CHAIRMAN PAHL: I'd  like  to  view  this  activity  as

                     we had the AHECS and the emergency medical services

                     applications before.  There was an allotment of funds set

                     aside to develop a special program, and this was    an earmarked

                     level of funds requiring special guidelines and special

                                    r    -A                 'in analoqbu     'tuation
                     review protedt 6s.    nd I see this as             s Si

                     in which we have up  to $4.5 million this fiscal year to award

                     through RMP-s for the establishment  of  these  pilot  arthritis

                     centers, and this will require  applications  from  the  regions

                     following receipt of guidelines and establishing criteria for

                     review, et cetera.  All of this has to be done back here

                     before we can announce the  conditions  of  the  program.  There

                     just hasn't been sufficient time to do this.  But we will

                     have a four@And a half million  dollar  pilot  arthritis  center

                     program this year which will be duly announced, special

                     applications will have to come in either as part of the

                     regular application or as an  earlier  deadline.  It  will  have

                     a special review panel made up of experts in the arthritis

                     field and their preliminary  review  recommendations  will  come

                     before this council and be acted upon and  then  funds  awarded.

                     Sot I see it very parallel to the kind  of  activity  we've  had

                     before.

                               This does mean that if you intend to  apply  for  some

                     of these funds that work should go  along  in  considering  what


                                                                            105

                    goes into an application and so forth.  But it doesn't mean

                    that existing RMP funds would be used to establish a pilot

                    arthritis center outside the parameters of this program.

                              We have a motio n on the table that has been,

                    seconded4  Is there any further discussion?

                              If not, all in favor of the motion, please say

                    aye.  [Response]

                              Opposed?  (No response]

                              it is carr

                              Now we have one more piece of business, and then

                    I think we might break for'lu'nch.

                              We have in this program the unusual opportunity of

                    doing good in various parts of the country, and we have

                    another opportunity this time.  In the Supplemental

                    Appropriations Act of 1974, Congress saw fit to appropriate

                    $9.5 million to be available until expended for the

                  construction of the Children's Ilo4;pital of Philadelphia, and

                    there has been a resolution drafted by staff for your

                    consideration, and the wording of this is parallel or along

                    the same lines as we had for some earlier construction

                    projects, and it should look quite familiar to you, except

                    we are now talking about the Children's Hospital of

                    Philadelphia.  Because it should appear familiar I am not

                    sure that extensive discussion is needed.

                              These funds Are available until,expended.  We will


                                                                              106

                    -work through     Hill-Burton program.  The mechanics of this

                    now are well worked out.  Everyone has  great experience
                                                                              in

                    this.  And unless there is a need for discussion on the

                    resolution,,we would like to take action.

                              However, if you would like to consider it over the

                    lunch hour or discuss it further now', why'of course  that"S

                    quite appropriate.

                              These monies are  above and beyond the fiscal  174

                    appropriation for the RMP'S.  They will not detract from what

                    we have been telling you so far about the kinds  of  support

                    which we  intend to provide to the RMP's for program

                    activities,  and we're not restricted to this fiscal yeari

                    since the  money is available until expend6d.

                              MR. OGDEN:  I move the adoption of the resolution.

                              MRS. MARS:  I second it.

                              CHAIRMAN PAHL:  It has been moved i

                    adopt the resolution as submitted.  Is there discussion?

                              If hot, ail in favor say aye.  [Response]

                              Opposed.!  [No response]

                              It is carried.

                              Thank You for your patience sitting through these

                    rather lengthy sessions on reports, but much has been

                    happening, as you see.

                              I think we should break for lunch, a d let me

                    indicate that we have now gotten through our business this


                                                                                   107

                     morning.  What we would like to do is reconvene.  Let's        see,

                     it's a quarter  of  1:00.  I'm  not  sure  what  your  schedules

                     of departure are.  we have the important business this

                     afternoon of going over the recommendations of the site

                     visitors and  review  groups  on  the  three  applications  that

                     were deferred from the last council meeting.

                                We also have the  appearance  of  Mr.  Rubel,  who  will

                     have an important role to  play,  as  you  see,  in  the  further

                     development of this program and so forth, and I ekpect him to

                     appear at 1:30 or thereabouts,  and  we  have  A  short  report  on

                     the Arizona RMP from one of  our  staff,  and  we  have  to  accept

                     or modify the minutes of  the  last  meeting,  which  are  in  your

                     folder and which  perhaps  you  could  glance  over  during  the

                     lunch hour and see if  there  is  any  amendments  or  changes  you

                     wish to make and take up that    after lunch.

                                So, I'would suggest   that we  try  to  reconvene  at

                     1:30 and no later than twent     of 2:00,,if  you  feel  you  can
                                                    y

                     get through the cafeteria  lines  a'nd"have  lunch  at  that  time.

                     Is that satisfactory?  Let's try    to make  it  1:30,  then,  as

                     close to that  as@we  can  get  through  our  lunch.  Thank  you.

                                 [A luncheon recess was taken at 12:45 o'clodk

                           P.m.]


                                                                            10  8

                                   AFTERNOON SESSION   1:50 o'clock

                              CHAIRMAN PAHL:  Now that we have just about

                    simultaneously both all of ourselves back and Mr. Rubel, I'd

                    like to reconvene the council for the afternoon session  and

                    just merely say we are pleased to have Mr. Rubel here,  who,

                    as you know, has been asked to coordinate the activities  of

                    the RMP, CHP, and health facilities programs in the Btreau of

                    Health Resources Development, and this is the first  meeting

                    that Mr. Rubel hat had with this council, and I think he'd

                    be willing not only to make a statement but perhaps answer any

                    questions you might have.  And then following this we can move

                    on into our executive session with the business of  specific

                    applications.

                              Gene?

                             'MR. EUGZNE R!UTB   I'm delighted to be  here.  I*m

                    torry I couldn't be here this morning, but I had another

                    commitment that I had to race away from.   Ind I didn't have

                    the opportunity to hear Dr. Margulies, Dr. Endicott, and

                    Dr. Dunn.  And T certainly don't want to reiterate, go over,

                    some of the ground that they already covered.

                              This is a challen ing time for all of us, and
                                               9

                    frankly I'm, as some of you in the room know, very excited

                    about the directions that I think we're moving in.

                              We've got a lot of uncertainty.  we have legislative

                    proposals, some already on the table and others  about@t6'be


                                                                                  109

                     put on the table. We  have  a  Congress  that  has  other  matters

                     it has to deal with, and we're not quite sure when our turn

                     in line--where we are in terms of the line.

                                Amidst that, we have to somehow make operational

                     decisions today and plan for where we are trying to go in

                     the months and years ahead.  That makes for growing lots of

                     grey   hair.

                                I thought I knew what comprehensive health planning

                    was all about or was beginnin  g to get  the  glimmerings  of  that

                     several weeks ago,, having been  here  for  six  months  now.  And

                     suddenly in these  last two weeks I've had to suddenly learn a

                     whole new--lear-n about all'kinds of things that I didn't

                     know about, and it has been a rather difficult time for me,

                     and both the RMP and Hill-Burton people have been just

                     wonderful in helping.

                                As you've already discussed, we know that there

                     are some operational decisions that have to be made very

                     shortly here.  We have money seemingly at our disposal but

                     not quite in our hands.  We have an order from a federal judge

                     And I    convinced that in a  matter  of  perhaps  even  days,  we

                     are going to have some definitive decision, and I think we can

                   get over this very, very long period of uncertainty.

                                The challenge, as I see it, is to use the resources

                     we have today to help us move  in  the  direction  it  appears  we

                     are going, whether it's next January or next June or someplace


                                                                                  110

                     like   that.

                                You have already had discussion  of  the  one  bill

                     that is in the hopper already, IIR 12053, and I won't go over

                     it except to saythat I see very much  of  a  consensus  on  the

                     major points between  the  Administration  And  the  Congress.

                     And so the job that I have is to try to help us move towards

                     implementing that legislation.

                                We d6n!t have a very good track  record  as  to  our

                     ability to pick something up and run@with it, once the

                     Congress does act.  Unlike other programs where we are

                     starting,something,@:from scratcho   just,.don't think we have

                     the--even if  we wanted to,  we  don't avo  the luxury of being

                     able to take  six.month$,or a year here  to  try  to  untangle

                     bureaucratic--snarls and-try to  get started.

                                The probl,6ms,in the health care  system require us

                     to dolsomething.  We can't just stop everything and wait

                     until we can get  ourselves  nicely  or4ahized,  that's   number

                     one.  And, number two, we've got organizations and

                     institutions that are counting on us for support, and we

                     can't say, "Well, You guys ]Ust  please  keep  going  until  we

                     can get out selves together."

                                And so we are starting now to'figure out what

                     could we do to prepare  ourselves  for  administering  the  new

                     program, even though we don't know exactly what the new

                     program is all about.


                              We have had a series of task forces already

                    within the Health Resources Administration, and  we  are  going

                    to have a lot more in the coming weeks and  months,  trying  to

                    eal idith some very tough polixy questions and some very
                    pedestrian operati6nal'problems of a new kind  of  operation.

                              Let me just say a word as to what I see the new

                    thing as being,, and then !Id be delighted to chat with you

                    about it.

                              The Congress and the Administration  are  grappling

                    right now with a notion of somehow  health  plahning--control

                    in the health care industry, regulation in the health care

                    industry.  And certainly with the big push that national

                    health insurance is getting, it becomes even greater of a

                    problem.

                              We know that the President has requested that

                    economic 6tabilitAtion controls be continued for  the  health

                    care industry and for the petroleum industry) there is  a  very

                    strong feeling on the part of the Administration that the

                    usual market forces aren't there and we need something.

                             Also a recognition, a very  strong  recognition,  on

                    the part of the federal government that to the maximum

                    extent possible it would like the states to take oh  this  job,

                    and that's one of the reasons that the Phase 4 regs  allow  for

                    a state to come in with its own program and to be completely

                    exempt from federal regulation.


                                                                             112

                              There is also a recognition, howefer, that health

                    care is not primarily a governmental kind of  program,  that

                    somehow we heed different kinds of"mechanismg to  deal  with

                    health than we do with sewer planning or with welfare, with

                    social services, transportation and A whole realm  of  other

                    things.that Are primarily in the public sector.  And there has

                    been this reco4h@tioh that we need to view the planning kind

                    of role, not so much at an arbitrary state level,  but  much

                    more in a medical service area, whatever that means.

                              In many cases overlapping state boundaries and

                    certainly overlapping other kinds of boundaries, and we have

                    a tough time describing what a medical servixe area is.

                              In many places the state is the natural unit, but in

                    many places it isn't.  And we somehow need to involve all the

                    sectors, providers, hospital administrators, the physicians,

                    other professionals in health care, the educators, the third

                    party payers, government, and just plain consumers, somehow to

                  Is it around a table and grapple with the T3roblems of a

                    community.

                             We certainly don't want to sit here  in  Washington

                    and decide how many hospital beds St. Louis needs or how

                    many hospital beds Topeka needs. tut yet we  recognize  that

                    somebody has got to do that.

                              I tried to say on  any oc asions th t what started
                                                m      c         a

                    out in 1966, 1965i, 167, as attempts at somehow organizing a


                                                                               113

                    little bit has now grown up, and the government is very

                    deeply concerned with how the health care system works,

                    doesn't want to take it over but does want  to  exert  some

                    control.

                               The challenge we have is how do you carry that out,

                    how do you do that. And we're all  starting  from  very  little

                    knowledge base, despite the fact that  we've  had  facility

                    planning under the Ifill-Burton T)rogram ever since it  started

                    in 1946. We don't know all that much about  how  you  plan  for

                    @a facility development.  We certainly have no common place

                    here somebody can go  and try to find out.

                              An example  I use now, we had  some beautiful pictures

                    in Time Magazine  about a month ago, the results  of  something

                    called a brain scanner.   It's a nice,@littl6 machine  that

                    costs $350,000.  'We have eveiy@intitution in this country,,

                    health care institution  it this 6ountryl trying to figure out

                    how to get one.  And there is no place that anybody can go

                    centrally and say, "Well, what is the thing?  How  much  is  it

                    used and what should it be used for and  what's  the  incidence

                    you need in order to use it and the like>"

                              And so we've got every institution in the country

                    and damn near every planning institution in the country

                    trying to figure out what do you do with these things.  And

                    we need obviously, it seems to me, an awful lot more of

                    ,central focus to--not to dictate, "You shall have  one  of


                                                                                114

                     these for every 500,000 population," but to say this is    what

                     it's like, this is what it's used for, and here's some

                     suggestions about how you  might--some  criteria  you  might

                     use in deciding where they should go in your geographic

                     area.

                               We recognize that the decisions that have to be made

                     here and the process is very much a political  one,  and  so  it

                     should be. I think we have learned  an  awful  lot  about  how

                     you organize these kinds of institutions or  how  you  set  up
                     this kind of organization. But  the  public  spotlight  is  very

                     much on us. Where once upon A  time  the  kinds  of  activities

                     that we're engaged in now were  viewed  as  marginal,  suddenly

                     they are in the forefront; with enactment of section 1122

                     which allows for review of capital expenditures, health
                     planning agencies have become in  many  communities  right  in
                     the middle of 9 6at big ficjhts'-." In many places they  haven't

                     been able to deal  with it very  effectively.

                               others  have had@to deallwith these kinds of

                     problems for years already and theyltb a lot more mature.
                                I kind of skipped all over the  place.  our  job  her

                     over the next month is going to be to try  to  figure  but  how
                     get this new thing implemented while at the  same  time  we  use

                     the resources we have today under current legislatiot,an  one

                     statement that I will make is that as  long  as  I'm  involved

                     with this, we'll be following both  what  the  original  law


                                                                            115

                    intended and what the courts tell us with respect to their

                    interpretation of the law, what the kind of authorities we:

                    have are to be used for.

                              Hopefully we can force some people to work together

                    tat perhaps up till now have not worked together.  There is

                    no question in my mind but what I see coming is one single

                    planning organization and having one organization that

                    covers every part of this United States.  Perhaps there will

                    be others that survive, but they won't be getting federal

                    f unding.

                              The challenge we have is to get from here to there

                    with a minimum amount of bloodshed and with a minimum amount of

                    oigani zational chaos, trying to keep our eye on the problems of

                    the health care scene rather than on our own organizational

                    problems.  But we are going to have a tough time.

                              I was in Philadelphia this morning.  We have

                    essentially ;a health facility
                                                 group,@whose start was in the

                    old Hill-Bukton 618--

                              MR. BAUM:.. 318.

                              MR. RUBEL:  318 agency that we,set up.  We have a

                    health management'c@orporati6h, which is one of the experimental

                    health service delivery system units which we set up.  We

                    have a regional medical program which we set up, and we have

                    a comprehensive health planning B agency which we set up.

                    And exactly where one ends and the other begins nobody knows.


                                                                            116

                    And we've got a fair amount of organizational chaos, and

                    we caused it.  Now the challenge is to somehow unravel all

                    of that, and it's not going to be very simple to do.

                              I'd be delighted to chat with you about what we're

                    up to and try to respond to whatever.,@questions or comments

                    you have of what Drs. Endicott and Margulies and Dunn said

                    as well.

                             MRS. MARS:  In,,this reorganization you do then not

                    anticipate changing the original mission of RMP, so to

                    speak, and the programming and projects?

                             MR.@RUBEL:   I have spent many, many hours

                    attempting to discover what the original mission of RMP was,

                    And;I'm sure you've discussed this at great@length.  I've gone

                    back and tried to read the history, what the original

                    commission contemplated and the shell that came out of the

                    Congress as a compromise.  We have this great mixture of

                    categorical programs--

                             MRS. MARS:  Let's say 1973.

                             MR. RUBEL:  There's no question in my mind that we

                    will be following very much both the word and the spirit of

                    the law, at the same time trying to use the resources that

                    we have to move towards where we think we're going now.  I

                    think we can do that.  I think we have done that.

                             I am amazed by the amount of cooperation that has

                    occurred in the past, some of it despite the federal


                                                                              117

                    government. In many ways local people  have  a  much  better

                    way of dealing with each other than we do  sitting  in  this

                    building.

                              That there's perhaps going to  be  differences  in

                    emphasis  And attitude I think so. There  is--it  should  be

                    pointed out, I don't know in the discussion of the legal

                    situation this mornihg--there is a section 910 of the

                    Public Health Service Act duly enacted by the Congress which

                   does authorize the secretary to make grants and contracts for

                    some specific purposes, not necessarily through regional

                    medical programs.  To what extent that authority is going to

                    be used or hot, 1 don't know.  But it was certainly within the

                    intent of the Congress in enacting it that it be used or else

                    they wouldn't have enacted it.  But these are questions@that

                    are being decided ri'ht now.,

                              MRS. MARS:  Otherwise you are saying it's going to

                    take a completely new direction?

                              MR. RUBEL: Now is it going to  take  a  completely

                    hew direction?

                              MRS. MARS:  After it is integrated.

                              MR. RUBEL: I would say when  the  Congress  passes

                    new legislation, I would think it's goih4 to take  a  rather

                    different direction.

                              MRS. MARS:  What do you anticipate this to be?

                              MR. RUBEL:  As I tried to say, a mechanism to allow


                                                                            118

                    for all the sectors of the health care scene at  the  local

                    level to got together and look at what is being provided in

                    health care and what they think is necessary, where the

                    excesses are and where the gaps are, and then  scheming  to

                    figure out how to fill the gaps and to curb the excesses in

                    cooperation very much with state regulatory kinds of

                    mechanisms that either exist already or are going to  exist

                    in the future.

                              DR. MERRILL:  Do you visualize as far as the staff

                    in Washington goes that eventually this group will be merged

                    as are the groups at the lower level and direction for  the

                    groups now amalgamated in the region will be directed by  a

                    group similarly merged in Washington?

                             MR. RUBEL: I don't visualize  that  tight  now.  I

                    don't visualize that happening until, new legislation is

                    enacted. We'have three separate divisions today,  and  they

                    will remain.so.  The great bulk of our efforts over the

                    coming months' have to be to administer our current programs,

                    while we're going to try to draw as best we can  in  working

                    with small task forces and trying to plan for the future.

                             Once we have new legislation, I think it inevitable

                    that we will have one organization.  Whatever it is, I would

                    say pretty clearly it is going to be administered as most

                    other departmental programs are in a decentralized  fashion

                    through our regional offices.


                                                                              119

                              MR. OGDEN:  If we as a group wanted to suggest

                    that some sort of pilot operation be attempted or  some  sort

                    of demonstration be tried of consolidating say a CHP VIBOI

                    agency with a subregional advisory group with the regional

                    medical program and perhaps that group working with the 1122

                    people on certification for Hill-Bttton in A particular

                    area of a state, would we be able to seekfunding for this

                    and get it?

                              MR. RUBEL:  There are some very specific

                    statutory requirements in current law and Title 9 and in

                    section 314 that have to be met. We can't just throw them

                    out.  But this kihd-of thing, I think, is very much worth

                    exploring and we can do it, and in many places  it  is.alm6st

                    happening already.

                              MR4 OGDEN: This is the point. it  is  occurring  in

                    some places, And if we could formalize this in some  sort  of

                    pilot activity in,@a few places or perhapsieven in one or two

                    states.

                              MR. RUBEL-  You have a pro  em wit   emon

                    I spent several years on the periphery of welfare reform, and

                    we had lots of people  s.ayitg we should demonstrate something.

                    Well, the time it takes to demonstrate whether  something  is

                    successful or not is not the time that the  politicians  will

                    wait until they make a decision. They're going  to  be  going

                    ahead, whatever we do.


                                                                               120

                               I would say where it makes sense in a community

                    to do it,  I think it's something that I would encourage

                    tomorrow.  But again we've got statutory things that we

                    just have to meet.  We can't waive them.  We can't throw

                    them away.  We can't make believe they're not there.  In

                    terms of dollars, we'vd qot plenty  of  dollars.  That's  hot

                    the problem.  Frankly I think  we have'tdo"many dollars.

                    That's going to cause us a lot of--all  of  us  collecitvely--

                    a lot of heartache with so man  dollars coming in all at once
                                                   y

                    and then with changes coming after  that.

                              MR. OGDEN:  I  h3nk we as  an adv sory counci

                    need not only keep of course in close track with you   as  to

                   what your thinking is, but you need to keep us advised of

                    what is developing so that perhaps some of  these  things  can

                    be done as soon as possible.  whether we can use Title 9

                    funds or 314(6) money or something of  this  nature,  whether

                    we fund it, CHP funds it.  I'm  sure  Hill-Burton  can't.  But

                    somehow money from either the CHP or RMP areas perhaps could

                    be found to put something like this together.

                              MR. RUBEL:  I don't think in most places it's a

                   q uestion of money.  It's a question of separate organizations,

                    contrasting styles, and people seeing  themselves  as  having

                    different purposes, more than the dollars.  1 don't think

                    the dollars will be an obstacle at all.

                              CHAIRMAN PAHL:  I think that these are appropriate


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                    issues@to discuss, bit  1 think that it is all too new

                    internally to give you a definitive answer.  But I think this

                    is the responsibility that we all have under this new

                    bureaucratic arragnement.

                              MR. OGDEN:  I think you .see what we have in  mind.

                              CHAIRMAN PAHL:  Absolutely.

                              MR. OGDEN:  These things have occurred.  We have

                    had, for example,right in my home town the local CHP "B"

                    agency is not operating.  The RMP man who is there and our

                    Eastern Washington Advisory Committee is doing CIIP "B's"

                    wokk@rright now on an organized basis. And thev hire  him  to

                    do this.  And as far as any work that goes on, the:certifica-

                    tion under section 1122 is concerned, he is very much

                    involved.  So, we've got that little thing sort of growing

                    .Wright now.

                              MR. RUBEL: We have given a great  deal  of  thought

                    @to try to figure out how on an organized basis we can  force

                    some collaboration--

                              MR. OGDEN: It's when you get to  the  state  levels

                    that you begin to run into the problems of the existing

                    structures that are there.

                              CHAIRMAN PAHL:  Also the National Association of

                    Regional Medical Programs of course went to court to free the

                    money for certain designated purposes, and I'm sure there will

                    be differences of opinion, depending on how those funds


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                    are  used, if it's not in keeping with what they feel is the

                    right direction.  And so there are problems in doing this

                    on a visible level as an announced Drogrammatic activity

                    with these released funds.

                              MR. RUBEL:  Let me just say that I have spent

                    v irtually evwry hour of the last two weeks, with the

                    exception of this morning, attempting to get some operational

                    decisions here so that we can start moving.

                              once we get some commitments from  the  department,

                    which I think is going to happen very soon, I would be not

                    only happy, but we've got to work very closely  together  and

                    work very closely together with the National  Association  of

                    RMP Coordinators.  There is no point in trying to do something

                    here in isolation or in secrecy, and that's not my style.

                    There may well be some differences of opinion, and we've got

                    to try to figure out how to resolve them as best we can.

                    It's going to be--you know, we've got a tough time ahead   of

                    us.   Wdlve got three or four months, something like that,

                    left in the fiscal year, And we are going  to-have to be

                    making a lot of;awaids during that time period, and  you  all

                    have to  be involved in that.

                              And one other point that I guess I should make,,  I

                    am making whatever efforts I can to make sure that within

                    the very near future the full complement of this council will

                    be sitting around this table.  It's going to take a little


                                                                            12 3

                    bigger table than we have here today.  The council has a

                    statutory role and we try to use it.  And you can't do it

                    very well with five people sitting here instead of the 20

                    that should be here.

                             We recognize that as a problem, and we're trying to

                    deal with it.

                             CHAIRMAN PAHL:  Are therr other questions, either

                    from council or public?

                             DR. GAYE:  I'm Dr. Gaye from the Regional Medical

                    Program in New Mexico.  Mr. Rubel, we have had a number of

                    experiences out in the field where it's intended for one or

                    more programs to work together, work in concert, and it would

                    be extremely helpful to us if word of the desirability of

                    programs working together would come down through the channel---

                    at approximately the game rate; and so it would be very

                    helpful to us, if you want things to happen out in the field,

                    and of course for all the three agencies that you're involved

                    in to hear about it.

                             MR. RUBEL:  No question that there is going to be a

                    lot of communication.  that's what Ilv6 tried to do and what

                    I've done up till now with our CHP ag6nciesand communication

                    is going robs the@egsdnce of what is going to be coming here
                    in the future.  There is only so much the printed word can do,
                    but there certainly is going to be an awful lot of it coming.

                    And I hope it can come back too.  We need all kinds of feeCback.


                                                                               124

                              CHAIRMAN PAHL:  Is there another question?

                              Yes, Mr. Lemke?

                              MR. LEMKE:  This is more in the nature of a comment

                    than a question. But I see this  from  an  entirely  different

                    viewpoint than you do.  And I think that RMP and CHP Are

                    working fairly well together, at least in my  experience;  and

                    urthef that there is really a crying need for both

                    organizations, one to represent the public and one to

                    represent the professional. side.  I think that in my

                    experience you may very well ruin the credibility of  both  of

                    them if you jam them together in too big a hurry.

                              MR. RUBEL:  We will not be jamming organizations

                    together under current legislation. I  think  that  it's,  you

                    know, to the extent that there is a,,feeling that there  is  a

                    need for a kind of implementing agency,, as has been  used  to

                    describe RMP, the place,to try to pt6sent that is  before  the

                    Congress.

                              I was ttyinq to reflect before on the  feeling  that

                    I get on the part of those in control in the Congress  and  in

                    the Administration that such an institution is felt not to

                    be necessary.  The only place where--first of all, we believe

                    or I believe that there ate matters of mutual concern  to  the

                    existing agencies today where they can very profitably be

                    working together.  But we have no intention under current

                    law of attempting to merge these organizations or to merge


                                                                              125

                    the federal agencies that are administering these

                    organizations.  Once we have new legislation, that becomes

                    a very different situation, and all that we'll be doing until

                    we have new legislation is contingency planning, which I

                    think is what any organization has to do. Or else  we'll  be

                    sitting with our mouth open and have to take six months or a

                    year to try to figure out how to put it together again.  I

                    don't think that's in anybody's interest.

                              CHAIRMAN PAHL:  As you,can see, Mr. Rubel has a

                    particularly difficult job during this coming period, and

                    I want to say publicly we are going to do everything we  can

                    to cooperate and assist in whatever forward direction the

                    'Administration is taking, and we certainly expect to have you

                    participate in not only the meetings of the council but
                    hopefully, as your schedule permits, the meetings of the

                    coordinators and others so there can be this kind of dialogue

                  both from Washington to those who are responsible for

                    participating in our program as well as vice versa.

                             So, we thank you for coming today, and stay as long

                    as you can.

                             MR. RUBEL:  Let me add one more point.  It's not

                    just here. In the six months that I've been responsible  for

                    CHP, I have--I was adding it up yegterday--I have traveled

                    some 60,QOO miles. I have visited some 35 areawide  agencies

                    and almost a dozen state agencies in CHP.  And I will continue


                                                                                 126

                     to do that as much as I possibly  can.  We  do  some  important

                     things here, but the real important stuff  is  being  done  out

                     in the communities out there, and I try  to  maintain  some  kind

                     of contact with reality.  Sometimes it's what you heed in

                     order to survive some of the kind of stuff  you've  got  to  take

                     around here.

                               I am encouraged by what I  see.  I  see  a  maturing.

                     I can recall--Mr. Gaye, I don't know if you remember this--but

                     I came to visit you when I didn't have  the  foggiest  idea  of

                     what RMP was about. It must be two and  a  half  years  ago,  and

                     it's a very different world today than it was then.  Andt

                     recognizing that there can be some very substantial philosophical

                     differences in terms of what our system should look like and

                     what kinds of governmental and private roles we need, I am

                     very optimistic. I think while, you  know,  I've  read  a  fair

                     amount about seventy-five million dollar budget, an enorrio a

                     decrease from past years, the amount of money that we are goin,j

                     to spend on this is not the critical  item,,  remember.  What  we

                     buy primarily is staff, people's  time.  We  buy  their  emotions

                     and their willingness to get in and--you can buy a fair

                     amount of that with $75 million.  le're not buying medical

                     services and we're not giving  people.,money.  And  looking  at

                    t hat one budget item and saying,  "T@his is obviously  a  tiny,

                     minor little thiTkg"--i'f that's what you do, you're  making  a

                     big mistake. This is  terribly  important.  I  would  guess  that


                                                                                   127

                     the new legislation that's passed here is going to be the

                     most important piece  of  health  legislation  passed  this  year.

                     'And I would rank it next to national health insurance in terms

                     of what we of the federal government  are  doing  in  the  way  of

                     working our will on the health care system.

                                CHAIRMAN PAHL:  Thank you again very, very much.

                     And I'm sure we will have some  more  questions  as  we  go  along

                    with this.

                                We asked Mrs. Silsbee to come  up  and  assist  us  in

                     our review of applications.  As the last item of open meeting

                     business, I would like to request adoption of the minutes

                    6'ther as submitted to  you  or  with  any  corrections,  changes,

                     that you,feel  a p appropriate.    I hope you have  had  a  chance

                     to perhaps glance  at  these over  the lunch hour,  and  if  there

                     are no changes,, we'd be  !ad  to  Accept a motion for adop
                                                                                 tion.

                                MR. OGDEN:   I move the adoption  of  the  minutes  as

                     they are.

                                MR. MARS:  I second.

                                CHAIRMAN PAHL:  It has been moved and seconded.

                     All in  favor  say  aye.  (Aesponsel

                                Opposed?  (No   response]

                                The minutes are adopted as submitted.

                                Now, this terminates the open session of, the

                     meeting, and we will ask all those who are not members of

                     the council or the government please to absent themselves.


                                                                             12 8

                    we appreciate your participation in the meeting, and in

                    just a moment we will turn to Mrs. Silsbee and the review

                    of the applications and findings of the site visits to

                    the three RMP'S.

                              (Time noted:  2:23 o'clock p.m.]