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                                                                                         DICAL    PR
                           -",14ATIONAL-ADVISORY COUNCIL Oil.REGIONAL-ME
                                                                                                     OGRAYIS@





                                                                               Rockville,         Ma-ryland
                                                                                                       1972
                                                                               Monday,     .5 Jline



                                                 ACE -FEDERAL REPORTERS,- INC.
                                                          Official Reporters
                                                        415 Second Street, N.E.
                                                                                                    Telephone,
                                                        Washington D. C.   20002
                                                                                            (Code 202) 547-6222


                                                      NATION-WIDE       COVERAGE
                                                                                                  V6








     CR 6499
     DENNIS/rs  I        DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE

                2                    PUBLIC HEALTH SERVICE

                3     HEALTH SERVICES AND MENTAL HEALTH ADMINISTRATION

                4


                5                            - - -


                6

                7                   Twenty-Seventh Meeting

                8                           of the
                9  NATIONAL ADVISORY COUNCIL ON REGIONAL MEDICAL PROGRAMS

              10


              I I


              12


              1 3


              14
              15                                     Parklawn Building
                                                     Conference Room "M"
              16                                     Rockville, Maryland
              17                                     Monday, 5 June 1972

              18


              19


              20


              21


              22


              23


              24

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                                                                              2




     CR 6499     1                       C 0 N T E N T S

                 2 AGENDA                                                 PAGE

                 3 Call to Order and Opening Remarks                        3

                 4 Announcements                                            5

                 5 Consideration  of Minutes of the February 8-9,
                      1972 Meeting                                          8
                 6
                   Introduction of Guests and New RMPS
                 7    Professional Staff                                    8

                 8 Confirmation of Future Meeting Dates                     10

                 9 Report by Dr. Margulies                                  11

               10  Report on Inpatient Beds for Seattle Cancer
                      Center                                               125

                   Consideration of Special Applications                   134
               12  Discussion on the Northeast Ohio Application            224
               13
                   Discussion on the Ohio Application                      231
               14


               1 5


               1 6


               17


               18


               1 9


               20


               21


               22


               23


               24

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                                                                                 3




       Dennis
        CR-6-499 I                  P R 0 C E E D I N G S

        ilb-1   2           DR. MARGULIES: If we can all have  our  seats,  the

                3 meeting will come to order.

                4            I would like to call your attention to the  agenda

                5 book which is the basic text that we will follow during the

                6 course of the next two days and particularly ask you to  note

                7 the statements on confidentiality of meetings and the Conflict

                8 of interest statement which are in there so that these  instruc-

                9 tions will be preserved during the course of the meeting  and
               101thereafter,
               11            Before beginning the main part of the discussion  for

               12 the day, there are some peonle I would like to introduce if  you

               13 have not Already Piet them because we do have some new members

               14 of the National Advisory Council and I will list them hot  in

               15 'ordpi7 of imp
                             ,ortance but in alphabetical order.

               16            First, Susan Curry on my right.  She is a second

               17 year medical student at the University of Florida in Gainesville.

               18 @ir. Edwin C. Hirito from Los Angeles who is to her right witl-i

               19 one chair inbe-tween.

               20            Dr. Gerhard @4eyer on my left over 1-iere who is a

               21 Practicing Ph sician and associate clinical professor in  San
                               y

               22 Antonio.  And llrq. @llariel S. Horgan from Albequerque.

               23            I also should announce to you that Ilarold Ilines has

               24 resigned because he found that the pressure of business didn't

  Ace-Federal Reporters, Inc.
               25 allow him,, to be here to regular -- on a regular basis and so






                                                                                     4



        nb-2        he has resigned which means that we will have a new --

                                I would particularly like to welcome the four new
                  2
                  3 members to this council.  ordinarily we would have had a
                  4 period of orientation for you but as you know the time involved
                  5 is too limited.
                                lie do have some new members of  the  National  Review
                  6
                  7 Committee also who we will talk about  in  a  few  minutes.  @ghat
                  8 we will do is set up a period of orientation  as  soon  as  we  can
                  9 so You can get accustomed to the usual procedures of the National
                10  Advisory Council.
                11              I think it is fair to tell  you,  however,  that  no
                12  member of the council has felt constrained by his newness.  This
                13  council is in many ways the most  effective  --  well,  I  think
                14  probably the most effective  of  the  National  Advisory  Councils.
                    It has never acted in an inhibited  fashion.  It  is  made  up  of
                15
                16  people who are willing to say  what  they  think.  It  has  been
                    flexible and has changed with the times.  It has continued
                17
                    to change. I think that you  need  feel  no  hesitation  in  enter-
                18
                    ing in at @rfy point that you think you  should,  say  what  you
                1 9
                    think, and donl@t be surprised if you  disagree  or  agree  with
                20
                    half, less, or all of the rest of  the  members  of  the  council.
                21
                    It is that kind of a group.
                22
                                1 would also like to recognize the fact that
                23
                    Dr. Chase is here regresentin- Dr. Z,,Iusser for the Veterans
                24
  Ace-Federal Reporters, Inc.  Administration. You all know John Chase. Dr. Ogden  will  not
                25






                                                                                  5


                    be here at all for the meeting.  I understand that neither
        nb-3
                 2  Dr. DeBakey nor Dr. Roth can be here tomorrow so we will cover
                 3  as much ground today as we possibly can.
                 4             Dr. @lilson will address the meeting tomorrow morning
                 5  rather than today and we had thought that Jerry Riso would be
                 6  here but lie will not be.
                 7             There are just a few details involving the meeting
                 8  this meeting of the council, an bxplanation of why we are in
                 9  this room and some things which you need to know about the cour;e
               10   of the activities in general.
               11              I would ask Ken Baum to acquaint you with them.  Ken
               12   I think you remember, is the person who makes the council
                    function, prenares aqenda books, gets people where they need to
               13
               14   get and does most of our thinking for us.

                               Ken?
               1 5
                               l@,IR. BAUII: Let me take a half minute here with  a
               16
                    couple of announcements. I  think  Parkinsons  Third  Law  says
               17
                    the amount of discussion is inversely proportional to tl-ie
               18
                    subject.
               1 9
                               First, about coffee breaks.  @le are going to have
               20
                    the usual coffee breaks at about 10:15 and 2:15 in the
               21
               22   afternoon.  On the other hand, because this room is small,
                    it is the only one we could get this time because we moved the
               23
                    meeting up a month, coffee is going to be  served  in  what  is
               24
  ,ce- Federal Reporters,  Inc. called the Charcoal izoom,of the cafeteria.
               25






                                                                                    6


         nb-4                  I think we have provided  everybody  with  a  little

                    map in your books.  If not, we have more on the back that
                2
                3   shows you how to get to the  Charcoal  Room.  At  coffee  break
                4   time just go out the door, turn right, walk to the end of the
                5   hall, the cafeteria is on the left.  And if you walk all the
                6   way through the cafeteria, it is the last bay on the left and
                7   will be set up with pots of coffee and  so  forth.  It  is  the
                8   usual dime for coffee and 15 cents  for  doughnuts  and  things
                    like that.
                9
                               Could we please have a show of  hands  on  how  many
               101
               li@  people are going to  require transportation to the Washingtonian
               12   for the dinner this  evening, council members?
                               (Show of  hands.)
               1 3
                               If the people who need transportation would please
               14
                    see @Irs. I.Iandal at the back of the room sometime during  the
               1 5
                    meeting we will get whatever arrangements have to be made.
               1 6
                               Ihcidently, Mrs. Handal was the one that sees to it
               17
                    that things work smoothly not me really.
               18
                               (Laughter.)
               19
                               For the dinner arrangements this evening, the happy
               20
                    hour will begin around 6:00.  Anybody who doesn't know how
               2 1
                    to get to the Washingtonian, we prepared a  route  map  so  you
               22
                    can all get lost.  Just don't take the wrong turn which gets
               23
                    you back to Washington. Anything  else,  ask  Mrs.  Handal  and
               24
  @ce-Federat Reporters,  Inc' me and we will try to help you.
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                                                                                 7


                              The dinner tonight is;qoing to be through the Washin(f-
                1
      nb-5
                   tonian's buffet line. Ile have a private room.  There  will  be
                2
                3  a private room for happy hour, but everybody will  go  through
                4  the buffet line for dinner.    I thought I would explain  that
                5  first.
                6             Dr. Wilson and Dr. Stone, as far as we  know,  are
                7  planning to attend the dinner tonight, too.
                8             Because this room is so small, anybody who is going
                9  to be leaving the meeting permanently, that  is  particularly
               10  the quests around the room, if you are going -- if  your  part
               11  Of the meeting that you are interested in is finished  and  you
               12  are leaving, if you would please advise l@irs. Handal or the
                   secretary at the door, we can use your seat for some  of  our
               1 3
               14  own staff.  Ile have had to be very careful to control attendance-.
               15  at the meeting because there isn't enough room  for  everybody
               16  who would like to be here.
               17             Ile will have a few seats that we are going to  be
               18  rotating people through and we hope it causes as little
                   inconvenience as possible.
               1 9
                              When we get to certain places one group  will  shift
               20
               21  in and another group will shift out so there will be  a  little
               22  bit of shuffling back and forth.
                              The only other thing is that there are a  couple  of
               23
                   unfamiliar looking folders perhaps on the  desk.  In  Addition
               24
  kce -Federal Reporters,  Inc. to the council agend, books which are black and  the  binders
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                                                                                    8


       nb-6      I  with the rings in them which are all colors of the rainbow,

                 2  you have an additional two books.  one is this blue folder

                 3  which contains some information about the review of emergency

                 4  medical services applications and there is this brown cover

                 5  folder with information about the review processes for manpower

                 6  programs.
                 7              When we get to the @IP application review, there is
                 8  an additional folder which we will be passing out to you in
                 9  a black envelope with management information system tabulations
                10  but we didn't want to overload the (lesl,,.  I thought we would
                11  mention what you have in front of you.  I think that is all.

                12              Thank  you.
                13              DR. I.IARGULIES:  You had mailed to you the minutes
                14  for the February 8th and 9th meeting.  If there are any
                15  additions, corrections, or comments to be made on them, I
                    would A preciate hearing them at this time.
                1 6
                17              DR. DE BAII"EY:  I move they be approved.

                                MRS.  IARS,, Second.
                18
                19              DR. !TAR(:,ULIES:  All in favor?
                20              (Chorus of ayes.)
                21              DR. L,LARGULIES: Opposed?
                22              (into response.)
                23              DR. @4ARGULIES:  There are some guests here, some
                24  of whom are going to participate actively in the council and
  Ace-Federal Reporters, Inc. agenda during the course of the day and I would like to
                25





                                                                                9


                1   introduce them to you.
        nb-7
                2              I don't think Fred Stone is here yet but he will be.
                3   Dr. van iloake is on my left over here.  He is the new director
                    of the National Center for Health Services Research and
                4
                    Development and we are going to ask him to talk to us during tli@
                5
                6   course of the morning about some of the tighter relationships
                7   which we are looking forward to having here.
                8              Dr. Gordon MakLeod is over here on the left.  lie is
                9   the director of the Health Maintenance organization Service
               10   and will be involved with our review of the III,10 applications.
               11              Dr. Margaret Edwards from the National Cancer
               12   Ins,-".4d..ti-ite is here, I think. Here she is right over on i.,Iy
               13   right.
               14              Dr.    McFinleave     from the National Heart and
               15   Lung Institute, next to her over here on the right, Arthur
               16   Brourg    from the National Library of Medicine.  They cluster
               17   together rather effectively.
                               Mr. John Corn, Smoking and Ifealtli,Proqraml way over
               18
               19   on the left.  '@ilir. 1',lmer olexa of IIE@Q audit agency, We have
                    to be careful of him.
               20
               21              There are some special consultants who are here.
               22   I don't believe that Scherlis is here yet.  He will be later
                    on in the morning.  Warren Perry a member of the IU4PS review
               23
                    committee is here.  Ile was chairman of the review committee
               24
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                                                                                  10


                 I a little over, whatever the time was, about eight days ago and
      nb-8
                 2 he will be presenting the review of those supplementary
                 3 grant applications.
                               There are some new members of the staff also whom
                 4
                 5 you will have an immediate reason to  know  and  work  with.  One
                 6 is Dr. Larry l@ose of the Professional Technical Development
                 7 staff who is right here on my right.  Ile is in charge of the
                 8 emergency medical activities here.
                               Bob Walkington chief of the  evaluation  branch  over
                 9
                   there on your right in the office of Program Planning and
               1 0
               11  Evaluation.
               12              One other bit of business to get out of  the  way  to
               13  get confirmation therefore, is the consideration of future
               14  meeting dates which are scheduled now on the  new  three  a  year
               15  on October 16 and 17, February 7 and 8, and June 5 and
                   The last two dates in 1973.
               1 6
                               Any problems with those, any reasons of ma3or imnor-
               17
               18  tance why we can't schedule them then?
                               All right.  @le will go on,  If there is anything
               1 9
     End @l    20  we have overlooked, I would appreciate hearing about it.
               2 1


               22


               23


               24

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    CR6499                                                                      L.L

    #2-ter-1


                I             I would like to spend a few minutes  with  you  now

                2  considering some of the major issues which includes policy ques-,

                3  tions which I am sure you are going to  be  interested  in.  I

                4  consider this an opportunity to discuss some  of  the  subjects

                5  which we are going to bring up.

                              The first of these has to do with  budgett  and  just
                0

                7  by way of review, I think you do recall that we had last year --
                8  some money which was held back, some $44.5  million,  which  was

                9  available for release during the  current  fiscal  year.  Also,
               10  a reminder that our appropriations now, one year appropriations
               11  and this makes a considerable difference in reviewing.
               12             As a consequence, '69 funds held over from the past
               13  year and the new appropriations, when there was  a  release  of
               14  funds we were restored to active level of  about  $145  million
               15  for the total RMPS program. The  amount  which  was  available
               16  for grants and contracts was actually $135  million,  and  there
               17  were certain funds earmarked which you will  hear  more  about
               18  during the course of our discussion, some 16.2 million, maximum
               19  for health maintenance organization activities.
               20             These will require only a part of the RMPS funds so
               21  that we will have a remnant of the 16.2  million,  which  will
               22  probably be in the range of $7 million, which will be available
               23  for regular RMP activities. It was $8  million  which  was  ear-
               24  marked for emergency medical systems. I  will  describe  that  a
  kce -Federal Reporters,  Inc. little more fully in a moment.
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    ter-2                                                                     12



                1             That was set aside for a contract  activity  conducted

                2  out of the office of the Administrator which is now at the

                3  point of completion of review of the contract.  There  was  $7.5

                4  million set aside for area health education centers.  That


                5  has not been. released.

                6             It is not certain whether it will, and  if  released,

                7  what the character of the restrictions, if any, will be,  and  we

                8  will talk about that in a moment.

                9             I think you recall that there was $5 million set

               10  aside for a Cancer Center to be constructed in  the  Northwestern

               11  part of the United States, and we will have an updating  of  that

               12  reqqest.

               13             That left -- and that is the basis upon which we have

               14  been functioning. Ninety-eight point three  million  dollars  for

               15  the regualar RMP grant activities. If the -- if we  have  a  out
               16  $7 million left from the HMO activies, and if the 7.5 million

               17  is released from OMB that will mean that our level of funds

                   available for regular grant activities would -- and that  is  the
               18
               19  key figure -- is a 112.0 million. of that, all  but  7.5  million
               20  is definite, but the 112 million is the maxim= we would have
               21  available between now and July 1, for use in RMP supported
               22  activities.
               23             we a  ,pr    ad to utilize,@that full amou @.with  no
               24  difficulty be4ause,of the variety of activities which we have
  kce -Federal Reporters,  Inc. developed.
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     ter-3                                                                        13



                 1             Now, there is, of  course,  the  next  fiscal  year to

                 2  consider, beginning July  1.  This  year  Congress  has  moved quite

                 3  rapidly. There has been  early  action  in  the  House,  early attior

                 4  in the Senate, and they are now  at  the  point  of  reviewing the

                 5  individual House  and  Senate  recommendations  and  subsequently

                 6  reaching some kind of a conclusion.
                 7             The figures which are under consideration range widely

                 8  and I think it would be  impossible  to  predict  at  this.time

                 9  what the final outcome will be. I  think  that  it  is  of  great
               10   importance that the total request  to  Congress  by  the  Adminis-
               11   tration was one hundred and -- was  over  $131  million  this  year,
               12   which is in contrast with the request of a year ago, which was
               13   about 52.5, recognizing a rising interest in what the regional

               14   medical programs@do6s.

                                            ..Coi4gress  accepts  the  administrations
               15              c
               16   request, and adds to it.  Whether it will this year, and whether
               17   that will actually survive  the  appropriations  process  is  specu-
               18   lative, and I am not very  interested  in  speculating  with  you.
               19              There have been  a  series  of  suggested  amendments.
                    One for a life@ p am     di I released  transplant  for  kidneys.
               20
               21   There has been a very large suggested amendment which would deal
               22   with categorical diseases among other things so that the
               23   figures range all the way from 1.11 mi,l],JLon to,229  million;
               24   meaning that my reasons for  not  speculating  are  fairly  obvious.
  kce-Federal Reporters,  Inc. The House and Senate Committees are scheduled to
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    ter-4                                                                        14




                1 consider the appropriations bill this week  and  it  is  possible

                2 that they will complete their action.  It would not be surprising

                3 if they did this tinte, because there are other things which are

                4 on their minds during the course of the  summer  and  early  fall

                5 which will probably encourage them to complete their activities.

                              Is there any question about this?  I  know@it  is  a
                0

                7 quick runthrough but most of you are  fairly  familiar  with  it.

                              DR. ROTH.- -I would like to ask some specific questions

                  about the earmarked HMO funds.  Is this the right time?

                              DR. MARGULIES:  Good a time as any.

                              DR. ROTH:  Well, as this council probably knows,

                  most of you know, some of us have been disturbed about the

              13  fact that money appropriated for the RMP has been diverted from

              14  our program, from RMP, into the promoting of the Health

              15  Maintenance Organizations, the HMOs.. for 4hich there is

              16  no existing legislation.

                              There has been no HMO legislation passed and no
              17
              18  money per se has been authorized for  the  development  of  HMOG.
              19  Now, if I am correct, during 1971, the initial grants for HMO,
              20  the money was, shall we say, pirated from  the  CHP  funds,  the
              21  314E funds in respect to 38 grants--iqhich were a
              22  $3.3 million, and there were 15 grants which were funded under
              23  the provisions of Section 1110 of the SRS activities; and then
              24  there were, in other words, 14  contracts,  amounting  to  about
Ace-Federal  Reporters,  Inc. 2.2 million that@came under.Section 304  of  the  Public  Health
              25






    ter-5



                1  Service Act; but since that time, there have  been  additional
                2@ grants up to a total of 110, for planning and  development  of
                3  HMOs, and it has been made abundantly clear that this is

                4  planning and development only, that there is a specific restric-
                           Niel limit III            DI
                5  tion against operation of any of these.

                6             I think, thus far, I am on sound grounds  of  state-

                7  ment of fact, is this approximately correct?

                8             Now, there have been a number of concerns around

                9  this town about the way this money was achieved in  the  House

               10  Appropriations Committee Hearings. Some  sharp  questions  were

               11  asked of the Secretary, and others as to where in  the  world,

               12  they got the authorization for this money.  I believe I am

               13  correct in saying that there is still a  specific  investigation

               14  going on in respect to $900 thousand of the one  million,  ten,

               15  that was diverted from Section 110 -- 1110 of the  SRS  funds.

               16             The question being raised as to whether this  was  --

               17  I do not know whether the right word in this context is

               18  "illegally," but diverted in a fashion that should not have  eer

               19  permitted.  Now, we get, in our distributional material this tine,

               20  some very interesting opinions from Assistant  General  Counsel

               21  for Public Health.  Now, one with relation t
               22  Education Centers, which makes it relatively clear that  in  the
               23  absence of specific legislation, there is very, very little
               24  R" money that could possible be devoted to the  support  of  the

  kce- Federal Reporters,  Inc.
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                                                                                16

    ter-6



                 I            That is not important except to view in a comparative

                 2 fashion with regard to what has happened with the use of our

                 3 RMP money for the support of HMO grants.  I would like to quote

                 4 to you -- I think you all have this in  your  black  book  before

                 5 you -- I do not know -- it is under the  Tab  HMO,  Grant  Proce-
                 6 dures, and it is the item there, if you will -- it is Office

                 7 of General Counsel, under the date of May 3rd.

                 8             If you look down to the middle  paragraph,  "'This

                 9 office has  previously advised in the context  of  proposals  for

               10  HMO Planning and Development, that this is the important thing

               11  to the extent that proposed HMO  activities  fall  within  the

               12  purposes of Section 910(c), funds  would  be  available";  and

               13  below this, below the blank line, Section  910(c)  is  quoted  as

               14  saying, "The Secretary is authorized to support research,
               15  studies, investigations, training, and demonstrations designed
               16  to maximize the utilization of manpower  in  the  delivery  of

    End #2     17  health services.

               18


               1 9


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               21


               22


               23


               24

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        3
                                                                              17


                I             I don't know how many of these HMO grants you  have
                2  looked at closely and seen what they were requested for and
                3  how they were being used, but my question is are any of  them
                4  by any stretch of the imagination being used for any of  these
                5  purposes in 19(c)?  My opinion, maturely achieved, is no,
                6  they are not.  HMOs, we are told by the Administration, already
                7  exist, to the extent that they service some 7.5 million
                8  people of these United States.  There are 30 organizations
                9  that they call HMOs.  Of these 30, I believe none were
               10@ subsidized in their organization  by federal funds.  They
               11  operate without federal funds; there is no reserve.
               12             "Studies" is a very vague word.  I don't know.
               13  This would be the weak point in my position, I suppose.
               14  Any time you are doing planning, I suppose you are  involving
               15  some kind of study, but I think in the context of  maximizing
               16  the utilization of manpower, which is what all these  studies
               17  and reserves are supposed to be doing, that HMO planning is
               18  far from the mark.
               19             Such evidence as exists in respect to HMOs is  that
               20  manpower productivity is a little lower in this kind of
               21  organization in terms of patient hours per physicians or number
               22  of patients per week or per month, and so on.  Obviously,  the
               23  planning is not being done in this area.  The planning is being
               24  done in the financing, the setting up of capitation mechanisms
  tkce-Federal Reporteis,  Inc. and it is my position that this has robbed us of a number  of
               25




                                                                                18



      mil-2         millions of dollars and we on this council sit here session
                2   after session approving grant applications, only to learn later
                3   on that they have been approved, but unfunded because we
                4   haven't got enough money to fund them.
                               Now, dammit,           Titl@           n 19 moni

                                                      rn nn in x7 i n
                    can be some of the most valuap             MP,  because   you

                                      to a  reqion.  We could be doing more witn
                7
                                      ergency medical service field,just to pick
                8
                9   one place, than we could do with our  specific  grant  money.
               10              I would like to raise the question,  and  I  think
                    there are several ways to do it, but I think  the  easy  way,

                    hopefully, is in an unemotional, out on  the  board  administra-
               12
               13   tive fashion, to find out if it is not possible to
               14   r  ding of our treasury.
               15              You have talked about 16.5 millions  coming  in  with
               16   an HMO earmark on it, and we might salvage  seven  of  it.  I
               17@  might be disposed to see what we could do to  have  16.5  million
               18   of it. I assume it would be impossible to get  back  any  of  the
                    millions that have already been diverted.  I have no particular

                    appetite for a useless procedure for  starting  a  congressional
               21   investigation or getting some senators  and  congressmen  raising
               22   the devil with the Office of the Comptroller, but  can't  we  do
               23   something about it in our own group?  That  is  my  question.
               24              DR. MARGULIES:  Let me make a partial response to
  4@e     aporters, Inc. you, Russ, and Gordon MAkLeod is here and can  certainly  add  to
               25




                                                                                   19



     mil-3       I  it.  I don't do it on the basis of administrative decisions
                 2  and the fact that the funds would not really be available
                 3  to us if we didn't use them for  this  purpose.  Let's  set  that
                 4  aside for the moment and raise the question of the appropriate-
                             14(l@) for the health maintenance organization activity.
                 5  ness of
                    It really is a matter of judgment about  what  an  HMO'notice)
                 6

                 7  can be.
                 8             From our point of view, we have felt comfortable
                 9  with the use of the funds for this  purpose  because  the  HMO
               io   can offer to us the only system that is useful for some of the
               11   things which we need to do and learn to do, which is a close
               12   enough universe between the provider at one end and the
               13   subscriber at the other end, so that you have an understanding
               14   of what you want to achieve and a system in which you can do
               15   it.
               16               One of our great problems in achieving  some  of  the
               17   progress in RMP is we deal with a system which is not bound
                    together in such a way that you can say  that  these  are  the
               18
               19   providers and they act in such and such a way, and these are
               20   the users of those services, et.cetera.
               21               I believe, and many of us on the staff  do,  that  if
               22   the HMO can be put together so that  you  have  an  understanding
               23   about a contract for services to be performed, it will
               24   provide the kind of laboratory for  improved  uses  of  health
  Ace - Federal Reporters,  Inc. manpower for improved monitoring of  the  quality  of  medical
               25





                                                                              2 0



         mil-4  I  care, for a better understanding of what we mean by health

                2  maintenance and an opportunity to test these ideas when the

                3  opportunity is not nearly as well-defined or  as  controllable

                4  as it is in the HMO. I think I would have to  agree  with  you

                5  that the beginnings of the HMO primarily have to do  with  the

                6  development of a reimbursement system, with actuarial  data  and

                7  with putting together the system itself.  But  thereafter,  once

                8  it has occurred, we, for example, in looking at the ways in

                9  which we want to achieve a better provider management of

               10  the quality being delivered, have found the HMO gives us
               11  opportunities for better learning and for better application,
               12  which the rest of the system does not, because it is too widely

               13  scattered.

               14             But perhaps Gordon, you would like to -- do you want

               15  to come up here and comment oh this?

               16             This is Gordon MakLeod, whom I introduced a few

               17  minutes ago.
               10             DR. MAK LEOD: When I walked in the  room,  I  asked
               19  if Dr. Wilson was here, no; Mr. Riso here, no.  I  asked  should
               20  I be here, and he said sure.  What I thought I would do now
               21  is respond to some of the queries, but try to address the
               22  issue at the level where I think I sit as the  program  director
               23  and that this has in fact had high administration.  There has
               24  been departmental administration and concern for  the  different

  Ace-Federal Reporters, Inc.
               25  system.  They have looked at three important aspects and one,






                                                                              21


      mil-5    I  of course    the first and perhaps the foremost one is manpowex
               2  and cost and quality.  I am not sure how the balancing
               3  works, but the three certainly do interrelate very closely
               4  and in order to address these three problems as they have
               5  been spelled out for the -- all of you innumerable times,
               6  the HMO strategy was devised -- the HMO strategy  really  was
               7  built upon the development of the last 20 or 30 or 40 years,
               8  as Dr. Roth has said in terms of prepaid practice  group  and
               9  in the last 15 or 20 the medical care foundation movement has

             10   moved into this area.
             11              This kind of activity has had  authorities  passed
             12   by Congress to do certain things with respect to  the  health
             13   care de"ipvery system in the country.  I have heard the
             14   secretary explain before these congressional committees that
             15   Dr. Roth has referred to that there is  existing  authorities
             16   for the activities that we are involved with, perhaps as a
             17@  defense on his part, perhaps as an awareness in  addition  to
             18   the opinion from legal counsel which is in your booklets,

             19   there is another one which isn't published here, which we can

             20   get where there is an approval from the office of General

             21   Counsel for the utilization of RMP money if the activity

             22   is maintained to the planning and developmental phases.
                  11   win,
             23              It is with these guidelines that we have proceeded

             24   over the past several months in addressing the  planning  and
ce  -Federal  Reporters,  Inc.
             25   developmental grant activity and also in the areas of contract





                                                                                22



       mil-6   I   activity for supporting HMO activity at this  early  planning

               2   phases.

               3              I think the -- from a substantive point of view, I

               4   would be happy to respond to questions you might wish to raise

               5   at the programmatic level. I do think it is perhaps more

               6   appropriate to address some of the decisions  with  respect
               7   to the issues Dr. Roth has raised at the higher administrative

               8   levels and I might say one other thing just as  I  conclude
                   these very imprompt@ remarks, and that is that one  of  the
               9                      L-
              10   issues that has been discussed over and over again in a program
              11   getting started such as HMOs is using existing authorities

              12   in order  to bring to the attention of the Congress the
              13   experimental activity that we have been inVo ve  in  and  the
              14   resu ts of that experimental activity, so that  Congress,  in

                   fact, can react, "How do you do this? What sort  of  funds  do

                   you use to get this kind of activity underway?  And  what  has

                   happened in the past?" And this may also  have  happened  for
              17
              18   RMP actually, is to have used funds from programs  which  are
              19   interested in the same objectives to a certain  extent,  in
              20   order to get them underway at a preliminary phase and  at  the

                   same time be going through the congressional process in order
              21
                   to @t the  support for these activities.

                              DR. DE BAKEY:  May I ask a question in this regard?
              23
              24   Aside from the judgments that have been made  concerning  the
 Ace-Federal Reporters,  Inc. legality of the diversion of funds for these various purposes
              25





                                                                                 23


      mil-7      1  may I ask to what extent is the role of the council in the
                 2 @funding that is approved by Congress for the regional medical
                 3  programs -- to what extent is the council involved in its
                 4  advisory role and -- as to the dispensation of these funds?
                 5             I realize there is a legal basis for the advisory
                 6  role, but I am particularly concerned about what responsibility
                 7  the council has?  In other words, these funds have been
                 8  diverted,to my knowledge -- I don't recall the council
                 9  approving the use of funds for the specific purposes.
               10              DR. MARGULIES:  Dr. DeBAkey has asked about the
               11   authority that the council has in determining utilization
               12   of funds.  In actuality, the grant -- the use of grant funds
               13   from RMP sources for HMOs has not as yet occurred and there will
               14   be on the agenda for this Afternoon, a consideration of that
               15   kind of use of grant funds.  There can be no use of grant funds
               16   tor any-purpose in R       hout prior approval by the National
               17   Advisory Council.
               18              The council has two roles, which I think you know
               19   more clearly than I do:  One of them is to approve the
               20   award of grant funds for any activity          or anywhere else
               21   in the program.  It also has the responsibility for advising
               22   on policy and, of course, in that case we have, with no
               23   exception I can recall, accepted the advice of the council and
               24   followed it.
  Ace - Federal Reporters,  Inc. That, however, is obviously not binding on the
               25





                                                                                   24


      mil-8      1  secretary because it is advisory.  He can always set it aside.
                 2             The other part of the machinery, however, which is
                 3  a little less obvious, is the  decision  which  the  Administration
                 4  any administration, may take, saying we would like these
                 5  funds used for this purpose.  Now, that cannot be done.
                 6  Supposing that an administrative decision should come along
                 7  saying we should put X amount of money into  an  activity  we  have
                 8  not heard of.  What would usually happen is that the funds
                 9  would be available for that purpose only, with an agreement
               ioi  between the Executive Branch, HEW, and  the  OMB.  If  the  council
               11   chose to support that activity, the funds would be used for tha--
               12   purpose.  If it chose not to, then the funds in all likelihood
          ac   13   would not be released for RMP at all.  So that t            nistra-
                    tive decision cannot give warranty that the f ds will be  uusseeld,
               14
               15   It can give warranty that they will be used if they are going

                    to be used only for that purpose.

                               DR. DE BAKEY: The reason  I  asked  this  question,  not
               18   because I didn't know the answer, but rather to bring to the
               19   -- for discussion, a matter that I  think  is  extremely  important
           @     0  in the role of every individual who is a member of the council
            IC 21   and that is the responsibility involved here in relation to
           v
   0           22   the program, programming. That, I  think,  is  the  most  important
           l@  23   responsibility of the council.
               24               In an appropriation of funds released by Congress,
  Ace -Federal Reporters,  Inc. the council -- one of the councils primary roles is to determine
               25





                                                                              25


     mil-9      1  priority of the funding.  This is done in determining the
                2  awarding of grants, but it is also done in  terms  of  awarding
                3  certain funds for specific areas, specific programs.
                4             Now if you introduce into the order of priority
                5  for the use of these funds, a matter such as HMOs consideration,
                6  then it seems to me that the council must  determine  whether
                7  within the limitations of the funds available, this particular
                8  program has the proper authority to refund them.  This is
                9  why I really raise the question because I think it  is  quite
               10  important for the council to make decisions and indeed it  is
                   the responsibility of the council to make its decisions.

                   This is its advisory role.
               12
                              That is why I consider this a rather important
               13
               14  decision and not one that the Administration determines without
               15  having the advice of council, because it does involve a
               16  utilization of funds appropriated by Congress for a  specific
                   purpose, regional medical programs activities.  The diversion
               17
                   of those funds for another purpose may or may not be  legal.
               18
               19  This is not really an important question because really it is
                   a matter of judgment in interpreting whether or not it  falls
               20
                   into that program.  My interpretation may be different from
               21
               22  yours.
               23             But it is the responsibility of the  council  not
               24  in that sense to make judgments, but rather to make its
  Ace-Federal Reporters, Inc. determination within the priorities of  its  decision-making
               25




                                                                                 2 6



     mil-10         process, whether or not this really falls within a high enough
                    priority within the limitation of funds to even be funded.
                 3             Therefore, it belongs within the consideration of

  End 3          4  the council.

                 5


                 6


                 7


                 8


                 9


               1 0


               1 1


               12


               1 3


               14


               15
               16@
               1 7


               18


               1 9


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               21
   0           22

               23


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                                                                             27

           4
          arl
                1             DR. MARGULIES:  I certainly subscribe to that
                2  view.  I would like to  pose     the administration's problems,
                3  and I don't mean this administration's, any administration's
                4  problems, however, in a consideration of what the council does.
                5             One of the inherent strictures in effective policy
                6  deliberations and one which we have all objected to accepting
                7  when it applies to us is the separate status of interrelated

                8  programs.
                9             We recognize, for example, the relations between
                                                             F 4-P
              10   HMO, National Center for Health Services, @ , Migrant
              11   Programs, and so on, and it's in the nature of the political
              12   process and one         t be preserved that many of  t  ese
              13   activities have a constituency of their own, have a method
              14   of gaining support, and are as a consequence  very  sharply
              15   focused on a final purpose which is to achieve  what  the
              16   people who backed it wanted to achieve.
              17              Now the problem of an  administrator,  whether
              18   it is a secretary or the administrator of  Health  Services
              19   and Mental Health Administration, or anyone elsei  is  to
              20   take that variety of activities, and many of  them  over-
              21   lapping so you can sometimes identify anywhere from five
              22   to 45  authorities which apply to an activity, look at the
              23   funds available, the resources available, and try to
              24   integrate in that process what is on hand to develop a
  kce -Federal Reporters,  Inc. program which is coherent and which serves a total purpose.
              25






                                                                             28

          ar2

                I              In order to do that, the issue is not RMP
                2   policy alone, but also RMP plus all of the other  policies

                3   which are interdependent.
                4              Now setting aside whatever one may think  about
                5   HMO as a new policy, if I remember the early days of
                6   RMP, one of the severe problems under which it operated
                                                                           iii -VA
                7   was the_a      jjjiii                     availability  of

                8   f                                 ero.
                9              As a consequence, it took a long period  of  time
               10      o from  ground zero to something better.  In t a     cLy
                    the council felt uncomfortable, but felt they had  to  get
               I 1
               12   the show moving and use funds.
                               In attempting to build another  activity  which
               13
               14   becomes an administrative priority like HMO, that kind  of
               15   slow start and fumbling around can be diverted only  if  you
               16   get something moving.
               17              I know this is a dilemma for administration,
               18   and it is troublesome for other people, but if one can
               19   assume -- and I think it is a reasonable  assumption  that
               20   HMO legislation will be passed -- it is a lot better  to  be
                    prepared for it by having already developed some understand-
               21
                    ing, developed the pdo@ e available, have things in   motion
   0           22
               23   so that the results achieved will be ahead by two years
               24   or more where they otherwise would have been.
  kce -Federal Reporters, Inc. That obviously comes into conflict  with  isolate
               25



                                         go r#4                               29
          ar3

                I   policy decisions and I think at least that's part of what

                2     are discussing today.
                3             DR. ROTH:  Harold, may I also say that I
            N   A   suspect most members of the council must recognize that in
                5   this we have gotten ourselves unhappily precipitated into
                6   the middle of an almost partisan political issue that has
                7   nothing to do with science or our fundamental job in sitting
                8   as an advisory council.
                              The HMO thing came in as a slowing began.  It
                9
              io    was espoused by administration, with a big A, and all sorts
              11    of interesting things began to happen as soon as this
              12    caught on, and the initials began to be popular.  Both sides
              13    of the aisle have now taken proprietary interest in these
              14    initials and nobody really knows what an HMO is going to be
              15    until we get some definitive legislation.
              16              We have three pieces of legislation in the current
              17    Congress, and lord knows whether anything will happen to
              18    any of them because of the diversities of sponsorship.
                    Probably, my guess is, that nothing is going to happen in
              19
              20    the 92nd, and you are going to get new bills in the 93rd
              21    Congress, and you may still have more new bills changing t e
              22    definitions of HMO.
              23              At the present moment, we have the Staggers bill,
                4   the Roy Bill, and the new Kennedy bill.  They are quite
  @ce- Federal Reporters, C. dissimilar in their characters. There is a move to really
                5



                                              ri4                              30

             ar4

                    liberalize the HMO concept to the point where it will
                 I
                 2@ embrace virtually all the foundation.
                               Under some concepts of HMO, there are six founda-
                 3
                 4  tions that are already being funded to  move  in  the  HMO
                 5  direction. Our funds are being  used  to  promote  something

                    that has not been legislatively defined and  I  think  this  is
                 6
                    a far cry from my concept of why we sit  around  here  and  why
                 7
                 8  we stay home reviewing grant applications to try to work out
                 9  ways in which the medical profession can extend the
               io   benefits of what we already know how to do  for  people  who
               11   need it.  We are not interested.  We are not funded, and
               12   the original Congressional intent, I think Dr. DeBakey
               13   would agree, and nobody ought to know it better than he, was
               14   not to be a research and development thing.  It was to use
               15   the knowledge and disseminate the  knowledge  that  we  already
               16   have in this country and in this world.
                               It was not set up to be a poverty T)roqram.,  and
               17
               18   the moment we become one small drop in that   poverty bucket
                    as a program or debt -- I think this council  has  a  very
               1 9
               20   real role in this thing, and although we  may  be  overruled
                    by what is done with the money  through  manipulations  from
               2 1
               22   above, I think it would be appropriate for  the  council  to
                    say strongly and clearly that we think this is an inappropriate.
               23
                    diversion of funds, and if this isn't  where  they  wanted  the
               24

  kce  Federal Repor@rs, Inc.
                    funds to go, they shouldn't have put  them  in  RMP.  They
               2 5






                                                                           31
         ar5                                                                )
                I   should have put them some place -- because what our
                2   is being equated with now, it is being alleged that
                3   has the same purposes as 314-E,for example, and CHB.
                4             We have been spending years trying to  point  out
                5   there isn't an identity of interest or conflict, that  we
                6   aren't on a collision course. We are supposed to  be  doing

                7   different things.
                8             I think we have just been caught up in a political
                9   issue which is rather distasteful to one who is trying in a
              10    nonpartisan way to do the best we can, to use the  monies
                    for the purposes that we are all enthusiastic about.
              12              DR. MARGULIES:  I think that there is some
                    embarrassment even now in the administration over the  need
              1 3
              14    to use funds from other resources for HMOs.  It is no secret
              15    that the administration had every reason to believe that HMO
              16    legislation would have been passed months and months  ago
              17    so that this would not have occurred.
              18              What has culminated is an arrangement in which
              19    there has been initiated enough -- pardon me -- enough  HMO
              20    activity to make it possible to look at what it is and to
              21    keep it on a tentative basis until there is further defini-
              22    tion. And whether the early offset of activities  was  --
              23    what the council might have agreed with or not, there is an
              24    investment in effort which we at the present time find
  kce -Federal Reporters,  Inc. useful which would be set back, which would indeed be  los
              25




                                                                              3 2


         ar6

                I  if these funds were not for that purpose.
                2             The Secretary accepted the-id@a in  is testimony

                3  that RMP funds should not in the future be used for this

                4  purpose, and indicated to the  appropriations  committees

                5         1 s is the one and only time it

                              In  ac                                        W"ng,
                6

                7  Rus, a use of RMP funds, and this may sound a little like

                8  sophistry, but it really went like this: Funds  for  RMP  were

                9  frozen in fiscal '71.  There was a need for funds in fiscal

              10   172 for HMO.  There was an agreement to release those funds

              11   that were frozen out of RMP for that purpose.  They  would  be
              12   used for that purpose, but not for another one.

                              It was expected that the whole 16.2 million
              1 3

              14   would be available for HMO, and that was  the  case.  However,
              15   with the slowdown of activities which followed the slow-
              16   down of legislative performance, not all of  those  funds

                   were to be used.  So whether it is counted as a blessing
              17
              18   or not, it means we will get $7 million for RMP activities
              19   for this fiscal year, which would otherwise not have been
              20   available to us.
              21              I know that's not responsive to your question, but
              22   what the administration tries to do, again, is  find  the
              23   resources available to do something, to put itself  in  a
              24   better operating positions than it otherwise would have been.
  @ce- Federal  Reporters,  Inc. 1, for one, would be very regretful if we
              25






                                                                              33
          ar7

                1   completely handcuffed the administration, which  does  from
                2   time to time have to move into different positions to

                3   move things in a new expression.
                4               The expression "tin-cupping" has been around
                5   the federal government for a very long period of time, and
                6   if you don't provide the opportunity to pick a little from
                7   here and there to get something done that needs to  be  done,
                8   it restricts the mobility.
                9               If we confined every program to a rigid definition
               10   of its purposes, we would have even more  fragmentation  than

               11   we now  have.
               12               You, on the other hand, feel this is  overdoing
               13   it for a given purpose, and I recognize that difference.
               14               DR. ROTH: I am glad you labeled  it  sophistry.
               1 5              (Laughter.)
                 IF#            DR. 14ARGULIES:  I said it may be.
               17               DR. ROTH: Of course, all you have to do  is  go
               18   one more step. This council and RMP  are  presumably  going
               iLo  to have nothing more to do with HMOs after this  one  fiscal,

                    this one year.
                                If you needed any other testimony to the  fact  it
               22   isn't RMP business,-I guessthis       d bq a good piece  of
               23   testimony.
                                 . DE BAKEY: The point  that's  important  here

  kce-     orters,  is that the funds used for any purpose that are in a sense
               25






                                                                             3 4

          ar8

                   assigned by Congress to RMP is the business of this  council.

                2  That's the point I am making.  I don't think that it's

                3  proper, whether or not the organ which is used or acceptable,
                4  is proper to use these funds without having consulting
                5  council.  I am not arguing with whether or not it should be
                6  done this way.  My argument is concerned with the role of
                7  responsibility of the council.  That's the only point I am

                8  making.
                9             DR. IMRGULIES:  They have not been used.
              10              DR. DE BAKEY:  It may well be that the council
              11   would agree to do this. My point is that the  council  should

              12   be consulted.

                              DR. MARGULIES:  They will be.  That is a -- on
              1 3
              14   the agenda.  There have been no grant funds used.  However,
              15   you realize that these funds can be converted into  contracts
              16   in which case the council would not be involved.
              17              DR. ROTH:  May I ask another question?
              18              Out of the 110 extant grants for HMO funding,
              19   how many came out of this branch of AEW?
              20              DR. MARGULIES: No RMP funds have gone  into  that.
              21              DR. ROTH:  No RMP funds?  How about contract
              22   grants?
              23              DR. MARGULIES: No. Nothing  in  contracts  either.
                   The exception to that -- that's correct, isn't it, Gordon?
              24
  @q -Federal Reporters,  Inc. DR. MAK LEOD: Yes.  I think perhaps the closest
              25




                                                                           35


        ar9
                1   thing to RMP involvement in HMO is myself, who was a
                2   member of the consultant staff of RMP before I became a

                3   member of HMO.
                4             DR. MARGULIES:  You shouldn't have said that.
                5             (Laughter.)
                6             DR. MAK LEOD:  Our activity to date has been
                7   funded within HSMHA through 314 money and outside of HSMHA
                8   from the SRS authority, which you alluded to.
                9             DR. MARGULIES:  The exception to this, Russ,
              10    would be any intra-RMP activity in support of HMOs that
              11    you know about.
              12              DR. ROTH:  I know.  This has been cropping up in
              13    grant applications.  That doesn't worry me at all.  Maybe
                    this is better preventive medicine than I thought if
                    nothing has been done.  Maybe we can prevent something.
                              DR. MILLIKAN:  I was going to add that I don't
              17    think there is any issue about us handcuffing the administra-
              18    tion.  This was a phrase that cropped up a few moments ago.
              19    I share the feeling that it is the responsibility of the
              20    council to make its feelings known about the fashion of
              21    the policy level at which the objectives of RMP are molded,
              22    and that we sooner or later should be called for a kind
              23    of opinion review of a situation like this, albeit contract
              24    or grant or whatever.
  kce- Federal Reporters,  Inc. It seems to me if we are going to work as a
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                                                                                  36
          arlo


                 I  community of folk in trying to put together over a
                 2  continuum, the real issues of RMP, we ought to do it in a

                 3  combined fas hion.
                 4              I think at a given time there may be differences
                 5  of opinion among us, but that the administration may hand-
                 6  cuff us.  We aren't going to handcuff them.  We are only
                 7  advisory and we recognize that.
                 8              DR. MARGULIES:  Except you control the funds.
                 9              DR. DE BAKEY:  Could we go off the record for a

               10   few moments.
               11               (Discussion off the record.)

  nd 4         12
   0
               13


               14


               15


               16


               17


               18


               19


               20


               21
   0           22

               23


               24

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       ty 1
                 1            DR. DE BAKEY:  We can go back on the record, if
                 2@ you want.
                 3            DR. MARGULIES:   Tony?

                 4            DR. KOMAROFF:  Last February when our sudden riches

                 5 were described to us but all of the earmarking was described, WE

                   all, I think, felt richer and somehow more supine and I know
                 0

                 7 that the Review Committee has felt the same sense of  frustra-

                 8 tion that we are hearing around the table.

                 9            Is there any way the specific issue of the HMO

               10  funds aside of conveying this kind of sentiment to the

               11  Administration because a devitalized advisory group is a

               12  significant below to the viability of the organization?

               13  Hasthat sentiment been conveyed?  We all expressed it, I

               14  think, in February.

               15             DR. MARGULIES,.  Yes.  And of course Dr. Wilson will

               16  be here tomorrow morning and I think it is perfectly reasona  e

               17  for these issues to be raised.  The point which Dr. D6Bakey

               18  just made is certainly a critical one in the RMP.  It has been
               19  my feeling that in the development of some strong regions  and
               20  most of them have become much stronger, that we are in a
               21  position to do some things with the categorical diseases,
               22  sensibly, better position now than we ever have been, that  we
               23  can carry out categorical control activities which will
               24  really affect the whole delivery system rather than serve  the
  Ace - Federal Reportefs,  Inc. special interests of a handful of people as many of the  early
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                                                                                 3 8
            ty    2


                  1  activities did.

                  2             However, the fact that I think  so  or  the  staff

                  3 thinks so doesn't satisfy  the  questions  which  Dr.  DdBakey

                  4 raised at all. His  points  are  very  well  taken.  There  is

                  5 also the very interesting question of how comfortable we are,

                  6 the Council, the Administration, and others with the process of

                  7 decentralization.  This regularly comes up.  There is no point

                  8 in trying to escape it.  If you in fact do allow the program to

                  9 proceed in the direction of  local  judgments,,  local  talent,

                  10 local efforts being applied to local problems and get stronger

                  11 and stronger  peripheral  programs,  parallelling  the  movement

                  12 towards stronger state government activities and so on,

                  13 do you imperil the  achievement  of  national  goals?  Are  the
                  14 two necessarily inconsisent and  that  is  something  that  this

                  15 Council needs to consider  very  carefully.  It  is  a  subject

                  16 for real deliberation.
                  17            I am surprised when we Are  told  that  the  problem
                  18 with the individual RMPs is that they are not responsive enough
                  19 to national policy when our primary  problem  is  to  keep  them
                  20 from all jumping in the same direction the minute that they hear
                  21 that is the way we are going to go.  Within a few minutes the
                  22 telephone is ringing saying when  do  we  get  our  application
                  23 grants in.  That has never been an issue but that is not

                  24 generally appreciated.
  Ace-Fedefal Repofters,  Inc.  You will see in the grant reviews for supplementary
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                                                                              3 9
           ty 3

                   award that in a period of a matter of ar-ew weeks the idea  of

                   emergency medical services and expanded  education  activities

                 3 was advanced from an early inquiry to the full development

                 4 of applications and a number of excellent ones.  This took

                 5 very little time.  It wasn't a question of the local determina-

                   tion process being indifferent to national policy  but  more  a
                 0

                 7 matter of whether they could be responsible to national policy

                 0 and have it been meaningful locally. This is  part  and  parcel
                 0


                 9 to the whole question.

               10             The issues you have raised today are the issues

               11  which the coordinators are raising, particularly the  one  of

               12  selecting priorities for funding and so on. I  think  there  is

               13  nothing more legitimate than your very careful review  of  it

               14  and transmittal of your concern.  This  becomes  particularly

               15  important -- let me just take advantage of the  opportunity  to

                   bring up the other two issues which take relatively little time.
                  ik          In considering new legislation, because  there  will

               18  be new legislation for the regional medical programs this

               19 year, our legislation has to be extended by July  1  of  1973.

               20  So also does the legislation of the other programs,  which  you
               21  have been discussing today and a number of  others.  It  Would
               22  be rather natural for those who review it in Congress  and  in

               23  the"  Administration to try to look at these legislative

                   proposals together and get something more  comprehensive  than
               24
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                 1            The comment you have been making today, whether

                 2 positive or negative are pertinent to the development of

                 3 legislation which produces whatever specificity or whatever

                 4 flexibility you think should be in our legislation and  those

                 5 that are apposite to it.

                 6            On the other hand, there are specific  requirements

                 7 which are imposed by Congress which are of an entirely

                 8 different kind.  One example of that wasthe expression by

                 9 Congress of their insistence that pulmonary pediatric  centers

               10  be funded at the level of the preceding fiscal year.  We  are

               11  making every effort to make sure that occurs. This  was  part

               12  of the appropriation language and is a specific act by Congress

               13  which expresses the will of the people.  There is no reason to

               14  question it.

               15             We will, as a consequence, be looking at some  pul-

               16  monary pediatric activities, either new or extensions,  which

               17  will allow us to maintain that level of $1.7 million in  total

               1 8 for the pulmonary pediatric centers.  But this again is a

               19  different kind of an issue when it is a Congressional question.

               20  What you are really looking for I think is a better way of

               21  dealing with the Administration on policy issues and I am

               22  obviously not an adequate representative of those policy

               23  considerations because I represent RMP policy  considerations

               24  andam responsive to those decisions which are made  elsewhere.
  Ace-Federal Reporters,  Inc. I think it is quite right that these questions  be
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                                                                            4 1
         ty 5

                1 raised and that you get the kinds of answers which  you  are
                2  pursuing.  This also has something to do with the description

                3  of the role of the Council in new legislation.

                4             The categorical issue, you are absolutely right,

                5  Mike, the -- there are a number of reasons why people  have

                6  felt that RMP is not appropriate for some of the large

                7  increases in funds for categorical activities and probably the

                8  most significant of them is the brief final life history  o

                9  the chronic disease control programs which is the point  at

               10  which I entered regional medical programs at the first place
               11  and was under hot debate at that time.  This has made a lot of

               12  people feel this is not an appropriate place for those

               13  activities to be carried out.
               14             1 did meet with the President's Advisory Council
               15  for Cardiovascular Disease and expressed to them our willingness,
               16  and eagerness to engage in effective categorical disease acti-

               17  vities.
               18             The one thesis that I presented, which I fee
               19  strongly about, which the Council may wish to consider,  is
               20  that an excellent categorical disease program inserted into a
               21  bad delivery system will end up with bad cardiovascular
  0                disease delivery and that you cannot carry out a control prograri
               22
               23  by setting up a few major demonstration centers and  depend
               24  upon something called education which is really exortation to

  Ace-Federal Reporters,  Inc.
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                                                                              42
           ty 6


                 1 do.

                 2            At this point if RMPs and certainly  where  they  are

                 3 at their best it is true -- if RMPs play a role  they  can  play

                 4 a control role which will carry it from knowledge into the

                 5 delivery system better than they could have in the past.  When

                 6 I first entered this program, it was the scattering of activities

                 7 with a coronary unit here or there or a training program

                 8 for emergency medical services with no emergency system'@or

                 9 registry of some kind which wasn't tied into anything at

                 10 either end which tended to characterize too much in the program.

                 11           But if you are going to have a  well  knit  structure

                 12 out there, and policy here, and you are going  to@  decentralize

                 13 to the best that local judgment can be utilized,  it  is  going

                 14 to require a high degree of observation and negotiation at the

                 15 Council level to make sure that the central purposes are

                 16 carried out effectively in the periphery.
                 17           I doubt that we have debated that as well as we should

                 18 have up to the present time.

                 19           DR. MAK LEOD:  May I add something on that?  I
                 20 would like to just add that the -- where the  process  is  today
                 21 is clearly part of the Administration's  approach  to  handling
  0              22 this particular issue and the Administration  has  proposed  to
                 23 have Council act en bloc following the  recommendation  of  the

                 24 National Advisory Council some months ago.

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            ty   7                                                                43

                 1  what the process has been to date.

                 2              The one other point that I  think  is  not  directly

                 3  germane to that particular action  but  it  is  the  development
                 4  group of which the RMP, National Services Research and Develop-

                 5  ment, Comprehensive  Health  Planning,  Hill-Burton  and  the

                 6  HMO make up the group is -- was included -- included HMO's

                 7  at the outset and I was part of  the  dialogue  that  went  into

                 8  that. It was  considered  to  be  a  developmental  activity.

                 9  There was some considerable debate as to whether it should go

                 10 into the service group,  because  of  the  service  orientation.

                 11 But the decision was made to include  that  as  part  of  the

                 12 developmental activities and perhaps at some later date on
                 13 passage of legislation to have its -- convert from this

                 14 particular level of activity.

                 15             I would just want to be very  responsive  to  what  Dr.

                 16 DeBakey has said and say that we have as part of this
                 17 reasoning process, and you will  hear  the  recommendation  of  the
                 18 ad hoc group later on, looked at the --  what  we  consider  to  be
                 19 important RMP considerations and they included the coordination

                 20 of the sources and services and the improved manpower

                 21 utilization  and  productivity,  effective  medical  records,
   0             22 information systems,  approaches  to  the  increased  accessibility

                 23 of medical care.  We did it to the extent that we had
                 24 anticipated and had actually received something on the order of

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                 25 $8 million in grant requests and we have tailored that down,

                   I





           ty 8                                                             44


                 1  prior to the presentation before the ad hoc group, to just a

                 2 little bit over 4 million trying to bring it into line with the

                 3 objectives of the regional medical program service as we

                 4 have seen it, recognizing that they aren't specific to the

                 5 heart, stroke, and cancer but perhaps in a broader area

                 6 related to the general disease.

                 7           We wanted to look at the total approach at this point


                 8 in time.


                 9           DR. MARGULIES:  I would like to -- we can come bac

               10  to the discussion and we certainly will when we go to the

               11  bloc review activities.  I would like to follow up.  As a

               12  symptom of the relationships between this Council and the

               13  decentralized RMPS, by pointing out to you that you have right

               14  from the time over two years ago to the present had a series of

               15  regional medical programs in which the coordinator was

               16  particularly singled out for his level of ineffectiveness,
                                              0
               17  where over a period of time there were frequenty recommendations

               1 8 that he be given somebody to help him out in an administrative

               19  deputy role.

               20            We have at the present time a replacement of somethin@

               21  between 75 and 80 percent of those who I was hearing all about
  0            22  at the time that I entered.  It can be done, you can have a

               23  separation of central direction and local function and still

               24  carry out some major alterations.  I think you will also, as

  Ace-Federal Reporters,  Inc.
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         ty 9                                                                     45

                 1  will see some striking changes  going  on.  There  will  be  more

                 2  of them. So the degree of management is significantly greater

                 3  than sometimes people think that it  may  be.  I  think  if  you

                 4  go over in your own minds the list of changes or taking a

                 5  look at Rochester, North Dakota, Oklahoma, Colorado,

                 6  Wyoming, Syracuse, and on down the  list,  with  the  exception  of

                 7  two or three, those that have been  a  source  of  real  distress

                 8  have been relieved significantly and were some very good

                 9  replacements so that it can happen.

               10               Let's move on in the agenda,  on  the  assumption  we

               11   can get back to this if you like.

                                I would like to call your attention there is a

                    result of the multiphasic  health  conference  with  the  report

               14   in the agenda books. I  don't  know  how  much  opportunity  you
               15   have had to look at it but it is there primarily for explanation.
               16   If there is any further action you want to  take  on  it,  it  is

               17   subject to your review.
               18               The conclusions in it are  an  affirmation  of  earlier
               19   action taken by this Council.  You  will  recall  in  general  we
               20   felt there had to be a much better  evaluation  of  what  is  going
               21   on in these activities than there have been.  I asked in
               22   turn that this be considered as a ESMHA4--, kind of a responsi-
               23   bility because there are similar activities in a number of
               24   other programs. The conference  supported  that  view  and  if  you
  Nce - Federa I Repof ters,  Inc. would like, you can take action, if you have had an opportunity
               25





         ty 10                                                                   46

                 1  to look at it, to accept this report  as  consistent  with  the

                 2  existing views of the Council or put it off until you have a

                 3  chance to look at it.

                 4             DR.  KOMAROFF:  John,  those  recommendations,  that

                 5  certain of the projects will be changed so that a joint

                 6  perspective study will be done?  Okay.

                 7             DR. MARGULIES:  Russ?

                 8             DR. ROTH:  Harold, this maybe sort of superfluous

                 9  but this has been such a fascinating thing to me to see
               101  some of the readouts and I am just singling out one, the
               11   Illinois project, multiphasic screening to detect coronary
               12   in persons and individuals with  subclinidal.'  heart  disease.

               13   I think RMP in this project has shown an extraordinar y
               141  important thing and that is that it tells us here that 22,929
               15   of these examples have been evaluated and they have notified
               16   the people who showed evidence in the opinion of the

               17   examiners that they were to be regarded as precoronary or
               18   coronary prone or that they actually had subclinical heart
               19   disease and the statement comes along that 50 percent of those

               20   people went to physicians.
               21              This is very different from saying you ought to
               22   have an annual physical examination.  Here these people,
               23   presumably intelligent enough to hold  jobs  in  industry,  and
               24   with insurance protection, you can  bet  on  that,  practically

  A,ce- Federal Reporters,  Inc.
               25   100 percent, are told you have something wrong, you have

                  I





           ty   11                                                             47

                 1  heart disease, or you are set up for a coronary, and still 50
                 2@ percent of them don't do anything about it.
                 3             Gee, if this isn't something we ought to make

                 4  something of and try to find out the answers on how you get
                 5  these people to do something about these findings, I am sadly

                 6  mistaken.  This is one of the more exciting things and at the
                 7  same time depressing to come out of our studies.  I just couldn't

      End #5     8  let it pass without pointing it out.

                 9


               10


               11


               12


               13


               14


               15


               16


               17


               18


               19


               20


               21


               22


               23


               24

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         swl     I            DR. MARGULIES:  The  professional  and  technical  devel-
                 2 @opment staff has felt very strongly about that sort  of  thing.
                 3 So far as I am concerned it also  underscores  the  difficulty  of

                 4 carrying out a meaningful control program  unless  you  deal  with

                 5 that particular fact.

                 6            You can demonstrate as long as you  want,  but  if  there

                 7 is no one out there to respond, it isn't going to matter.

                 8            DR. ROTH: I don't want to use  this  for  a  soap  box,

                 9 but I have long been using the illustration  of  a  hospital  admin-

               10  istrator whom I.knew well for 50 years who sits  in  her  office

               1 1 and allows a carcinoma breast, to get f lungating and  metastasized.
               12  surrounded by the talent to do something about this early.

               13             It wasn't lack of money,  lack  of  education.  It  was
               14  fear, basically fear or mistrust on her case  of  the  people  she

               15  worked with every day.
               16             In the case of the 50 percent  of  the  Illinois  union
               17  members, you have to do more studies to find  out  exactly  what

               18  these bare years are.
               19             DR. DE BAKEY: Yes, but I think,  Russ,  I  think  one
               20  of the important things though is to look  at  the  positive  side

               21  of this.
   0           22             Over 50 percent of them did  respond  and  they  picked
               23  up this group.
                              Now, I think this is important -,- an important
               24

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               25 objective of the program. To be  sure,  there  are  50  percent  of

                 I







                                                                              49


       sw2      I them that didn't respond, but the fact remains we picked up  some

                2 people in terms of the control program that needed attention

                3 which would not have been picked up without this'.

                4            DR. ROTH: I am happy to be happy about the 50  percent

                5            DR. DE 4AKEY:  I agree with what you are trying to
                6 say, but what I am trying to bring out is here is-an example  of

                7 one of the real objectives of the program.

                8            You knowt this is the kind of achievement that I
                9 think needs to be emphasized.  There are many others.  I don't
              10  want to get started on it because I would take up too much  time

              11  with the council.
              12             I have given my speeches before in this area,
              13  because of the lack of achieving Control.
              14             DR. SCHREINER:  I think the point Russ is making
              15  about studying the bare years, go beyond that.  I wouldn'ti
                  accept the fact that 50 percent of the people are going to  doc-
              16

                  tors is doing anything about it.
              17
              18             we ran into this basis. You can report back  and  get
              19  the man to go to his doctor, but the doctor doesn't know what  to
              20  do about it or there is no concerted program to take it from
              21  Point C to point B.
              22             DR. ROTH: What did the 50 percent that went  to  their
              23  doctors  do?
              24             DR. SCHREINER: They may have ended up  producing  more
  @ce -Federal Reporters,  Inc. cardiac neuros0s. We don't know what happens after they are
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         sw3    I  picked up.

                2             DR. MARGULIES:  It is precisely that failure

                3 with these activities to pursue to see  what  happened  with  both

                4 50 percents that has made us fell we have to evaluate this
                5 thing much more before we set up any  more.  We  don't  know  what

                6 that   means.
                7             All we are saying in this report to you is that we
                8 still feel that that kind of a study needs  to  be  carried  out

                9 before we put more RMP money into it.
               10             If there is no objection to this report, we will
                              ---- ---I     -           - --            SIR i i i im@i ,"'
               11 consider it acceptable to the council at the present time.
               12             Let me then remind you on the three cycle review
               13 process that we are well established into  it,  that  the  regions
               14 which had to change their ann     rsary dates have all gotten new

                  anniversary dates.
               15
               16             This has given us a certain@@amount of finding flexi-
               17 bility in this interesting budgetary year and  at  the  same  time
               18 has gotten people on to a  three  cycle  arrangemontquite  comfor-
               19 tably with actually relatively,,little objection to it.
               20             A few minor bookkeeping skirmishes and that is about
               21 all.
   0           22             What we are doing with the  regions  is  negotiating
               23 new levels  based upon an extended fiscal year so  that  a  region
               24 which was moved, we will say, from July 1  begin  date  to  four
  kce -Federal Reporters,  Inc. months later, has been given funds to carry it through 16 months,
               25







                                                                               51

        sw4      I but these have been limited so they can renegotiate  new  levels.
                 2            In the process of renegotiating.the new  level,  it
                 3 gives us the ability of supplying the funds either in  this  f*6-
                 4 cal year or next fiscal year which allows us then  to  consume
                 5 a very wide range of potentialities in the money we have

                 6 between now and June 30.
                 7            We were not surprised that we would be -- as  we  were
                 8 on June 1, uncertain of our total funds available to  a  total
                 9 of about $1.5 million with 30 days to decide.
               10             In fact, we rather suspect that would be  the  case
               11  and we are well prepared for it.  Part of it has been to put the

                   regions on a new kind of a cycle.
               12
               13             We have, in the process of doing that, been able to
               14  achieve two other thin s. One of them is to schedule staff
               15  visits to the regions three to four times per year on  a  regular
               16  basis so there is no uncertainty about it in the minds of the
               17  regions or the staff with a higher level of priority to the
                   regions which have in the review process shown up  rather  poorly
               18
               19  so we canuse our skills where they are most needed.
               20             This is going to be on a scheduled basis as the needs
               21  are dictated by the status of the program as determined by the

               22  review process.
               23             We have also been able to cut down the staff paper

               24  work.
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                                                                             52


          SW5   1  accommodation to the exigencies of life and it was.

                2             On the other hand, I think it has improved  the  paper

                3  work by making it simpler.  However, if you find that the

                4  simplified versionsavailable to you are not quite  as  adequate

                5  as they have been in the past, they don't give you as much

                6  information as you would like, we can respond,in a  limited  way

                7  to changes which are requested, but if we are going to  have  a

                8  smaller size staff as we have, a larger budget,  the  possibility

                9  of increased demands of the kind Dr. DeBakey is describing, more

               10  staff visits, we dan't do the same kind of paper work and we

               11  are going to be doing some adjusting between various  levels  of

               12  good so we may have a little more of one good and a little

               13  less of the others.

               14             I hope you will be tolerant.  That is a rather

               15  familiar administrative exercise.
               16             I would also like to bring to your attention  --  and
               17  this may become extremely important in the light of the
               18  discussion we 3ust had during the first part of this  morning  --
               19  that there are draft guidelines and regulations which  have  been
               20  prepared by the staff. They are in the agenda  book  dnder  the
               21  title 'proposed regulations."
   0           22             What will be done with those regulations :if they  are
               23  left unaltered is they will be put in the Federal Register.
               24  You would be well off to review those carefully,  because  once
  Ace-Federal Reporters,  Inc. in the Federal Register, and once accepted in general,  they  do
               25







                                                                             53


       sw6       I become the regulations under which we operate and the deal  with

                 2the very tough question of the relationships between  the,  .1

                 3grantee, regional advisor group, and the coordinator and his

                 4program staff.

                 5            That in turn has very heavy implications for what

                 6this National Advisory Coucnil does, because it has been a

                 7strong feeling as an expression of the legislation, not  a  clear

                 8definition of the legislation, an expression, that  we  entertain

                 9grants which come to the regional advisory group which in turn
               10 have@been subject to their scrutiny and which represent  their

               11 policy of determinations.

               12             At the same time, a number of the regional medical

               13 programs have gone thorugh varying degrees of conflict o

               14 regional advisor group and grantee.
               15             We still have some instances in which the grantee  is

               16 convinced that the final decision belongs with it and that  if
               17 the regional advisor group says we should do B and they  don't

               18 like it, they can cancel out that request.
               19             If that is to be alteredo and we are trying to
               20 express what appears to be the Council view, it will have  to  be

               21 altered in the very near future.
               22             Those regulations are not going to be ciroOlated to
               23 the regional medical programs now because they are  not  official
               24 and if they get altered we will simply have more confusion.

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                                                                               54


        sw7     I has been an extremely hard labor on the part of the staff  here.

                2            DR. PAHL:  I would just like to interrupt for a

                3 minute and say in my presentation, when you finish our other

                4 point on agenda, I would l@ke to bring the Councilback to this

                5 section of yourblack loose-leaf binder as well as an item  which

                6 Dr. Margulies has been referring to which is actually in  your

                7 folder.

                8            If you want to proceed with that general introduction

                9 we will have a few more specifics later.

               10            DR. MARGULIES:  At the risk of no later taking

               11 advantage, but perhaps Bob, you'4ave gotten some sense of  the

               12 Council in the period of time that you have been here, we  are

               13 very pleased with the fact Bob Van Hoek has taken over as

               14 director.  All of us have felt that there is much more that we

               15 can do together than we have in the past because@he@'is"ther-e@

               16 and although he has on@                            p
                                         ,y been director for a brief  6riod of

               17 time, I am sure you know that Bob Van Hoek  has been a-,v_qry

               1 8active part of ASMHA since it was organized or right from  the
               1 9very beginning, has occupied key roles as deputy administer  and
               20 deputy director in a variety of circumstances; and I have  asked

               21 him to come here.
               22            If you will Bob, come up and acquaint us with  what
               23 You are doing and encourage the Coundilto be argumentative.
               24          @4R- VAN HOEK:  Thank you Harold.
  Ace -Federal Reportets,  Inc.
               25            I appreciate the opportunity to visit with the






                                                                                   5 5
     f ls SW


     dw I         1  council.

                  2              I have only been in the present position two months

                  3  and I am getting acquainted with many  of  the  details  of  the

                  4  center and its programs.

                  5              Much about what I am going to say in the next few

                  6  minutes in  opening really comes from the perspective of my

                  7  three years experience in the office of the administrator in

                  8  which I was involved in evaluation, planning, budget, operation

                  9  of virtually every program in HSMHA.

                10               And during that time one of the things that

                11   concerned Dr. Wilson and the staff of the agency was the diffi-

                12   culty of getting plans and programs developed in a cooperative

                13   fashion among the various programs.

                14               It appeared to us that in general the programs

                15   and some of it, of course, based on the history of the
                16   programs  themselves  and  the  agencies'  formation  functioned
                17   quite independently and developed their programs with certain
                18   priorities and objectives in mind  which  were  related  to  the
                19   objectives and programs of other activities in the agency.
                20               So there would be times when looking at a particular
                21   area of activity, it appeared at least that many of the program;
                22   were doing the same kind of things, supporting the same kinds
                23   of activities, with very little interrelationship.
                24               It was interesting,to'8it here this morning and
  Ace - Federa I Repotters,  Inc. hear some of the  discussion  about  multiphasic  screening  and
                25







     dw 2                                                                            56

                  1  other activities and this can be -- we can take similar
                  2  areas of development in the area of manpower development
                  3  and the utilization of manpower and the development of
                  4  ambulatory care  clinics,  or  developments  for  the  poor,  some
                  5  of which have been jointly planned and some of which have not.

                                 From the standpoint of the center, I see the
                  6
                  7  center's role one of participating in as well as carrying
                  8  out through its  programs  studies  on  how  health  services  are
                  9  delivered, the components of the related services activities,
                10   and the effectiveness of those activities and also to ::-.-
                11   identify problems  and  to  develop  answers  to  those  problems.
                12               Let me take  off,  since  the  multiphasic  activity

                     was discussed, let me take off there as an example.
                1 3
                14               For instance, one of the basic questions I am contin-
                15   ually asked wherever  we  deal  with  preventive  care,  disease
                     control programs, multiphasic screening programs, and so
                16
                     forth, is what is  the  level  of  patient  acceptance,  patient
                17
                     fbllowup, and response to whatever professional guidance may
                18                                                                  ---------- --
                1 9  be given.
                20               It is amazing at least from the standpoint of
                21   the national center how few studies are actually being
                22   conducted in that area,  probably  one  of  the  most  important
                23   areas in the health field,, simply, once the individual or
                24   patient or consumer is in the system, and there is followup and
  Ace - Federa I Reporters,  Inc. the patient has direct contact with the health services
                2 5







                                                                                    5 7

     dw 3        1   system, what is the professional response to that -- the

                 2  identification of that problem.

                 3               In other words, what is the quality of care and the

                 4  quality of services rendered and in what manner is it

                 5  presented?

                 6               Is the fact that the patient!s acceptance or

                 7  consummer's acceptance is low, is that partially due to the

                 8  lack of education  from  the  standpoint  of  the  professional  to

                 9  the consumer or the  types  of  knowledge  that  are  available  to

                10  the professional in providing that service.

                                 That, again, is an area in which there are a

                12  number of projects in which the Center has done relatively

                13  little.
                14               As far as I can tell, from my own experience,

                15  very little  in the agency as a whole has been done.
                16               I would say at  the  moment  from  the  standpoint  of
                17  the Center,  I see those as two of the highest priority

                18  areas.
                19               This is not to  say  that  these  are  programs  which
                20  will be done independently with the Center, but in conjunction
                2 1 with the 314 (a) programs in both designing the studies as
                22  well as carrying them out.
                23               I might point out that the budget of the Center is
                24  on the order of some 64 to 65 million dollars which represents
  \ce -Federal Reporters,  Inc. only three percent of the HSMHA budget and one tenth of one
                25





     dw 4                                                                      58
                 1  percent of the total dollars in health care expended in this
                 2  country.
                 3              Therefore, it is important for us to use that fund,
                 4  invest  that money in conjunction with other developments in
                 5  the -- trying to improve helath services.
                                Another area that I feel the Center should
                 0
                 7  place  great emphasis on and  which  will  require  the  participa-
                    tion of  any HSMHA programs as well as non-Federal programs, is
                 8
                    in the  area of resource utilization and productivity.
                 9
               10               By this I mean a combination of studies on man-
               11   power, studies on technology  --  the  application  of  technology
               12   to hd-a:lth"deli-very and the utilization bf'facilities  wf@h--Ehe
                    maj'6r'-'e"mphasis on ambulatory care.
               13
               14               And rather than the Center supporting the train-
               15   ing of new kinds of manpower or the construction of experi-
               16   mental facilities and so forth, the major emphasis will be
                    placed on actual studies of productivity, using industrial
               171
                    engineering and systems engineering approaches, economics
               18'
               19   studies, and studies on proficiency of health manpower and
               20   development of testing and education -- testing techniques
               21   which can measure proficiency productivity which can then be
               22   used as a feedback into  the  educational  or  training  processes
                    and also working with  professional  organizations  to  feed  back
               23
               24   into recertification and  relicensing  as  that  develops  through
  @ce- Federal Reporters,  Inc. the various specialty boards and licensing bodies.
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    dw 5


                1              I think that in in general, those are some of the
                2. thoughts that I have and I would be interested in your reaction

                3  to that.
                4              I hope that in the future we will be -- we will
                5  continue to have joint discussions on our program activities.
                               Harold is going to be participating with  me  in
                0
                71 a meeting of our advisory council later this month in the

                8  same way.

                9              Thank you, Harold.

               10              DR. MARGULIES:  Thank you.

               11              Are there some --
               12              MRS. WYCKOFF:  How do you relate to the community
               13  base manpower programs that we are working on now?  Does your

               14  agency relate to those?
               15         \Ik@ @               At the moment, and I am speaking
               16  from a little information, I don't believe we have  had  any
               17  direct involvement in those community based programs.  This
               18  is an area where I think it is extremely important  that  we
               19  develop a mechanism for joint planning and joint program
               20  development and. implementation.
               21              One of the areas I found a major problem in, again
               22  from my experience of several years in the agency, is that we
               23  have a tendency to start programs with certain assumptions or
               24  initiate new programs with certain objectives which could
  kce- Federal Reporters, Inc. be stated in quantitative terms or output terms, and then we
               25





     dw 6                                                                          60
                  i  could measure what we have achieved at some point subsequently.
                  2               The tendency to take many  of  the  things  as  an
                  3  acknowledged fact  or  impression,  a  fact  unsubstantiated  by
                  4  some very limited information or studies seems to me that what
                  5  we need to do in health services,research and health services
                  6  deliveryis model some of our programs on the clinical
                  7  research collaborative  models  that  have  been  carried  out  and
                  8  that is to develop  some  uniform  protocols  for  large  scale
                  9  programs,  either  for  demonstration  or  developmental   activity
                10   which then a number  of  groups  in  the  country  can  participate
                11   in with you with very well defined objectives, well defined
                12   procedures and stages for evaluation so that at some point,
                     three years or five years from then, we can determine what we
                1 3
                14   felt was a way to go,in fact, proved to be the case.
                15                There are many examples of this that I could
                16   cite in programs,  concepts  such  as  Outreach  in  ambulatory
                17   care programs.
                18                If you look at what we support in Outreach
                19   activities, they range all the  way  across  the  board  in  the
                20   characteristics of the  Outreach,  what  kind  of  services  it
                21   provided, and there is no way of comparing the different
                22   programs other  than  by  very  intuitive  subjective  judgment.
                23                DR. MARGULIES: We  have  felt  when  Bob  and  I  have
                24   talked that there is a  continuum  between  RMP  and  RMD  which
  \ce - Federal Reporters,  Inc. has not been adequately developed.
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     dw 7                                                                       61



                 1               This is emphasized by the kinds of discussions we
                 2  have had today but also by the fact that we do not regard
                 3  RMP as a source of innovative new reserach into delivery
                 4  systems but rather as a mechanism for making sure what is
                 5  worthwhile becomes a part of the system.
                 6               Too frequently the problem of the transfer of new
                 7  understanding is not addressed and it really doesn't matter
                 8  whether you are talking about new scientific knowledge,
                 9  which was the original focal point for RMP or the transfer
               10   of new delivery knowledge.
     end 6     11

               12


               13


               14


               15


               16


               17


               18


               19


               20


               21


               22


               23


               24

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                1             we have all heard the coordinator complain something
                2@ was happening in his backyard he didn't even know it was there.
                3             I doubt -- if there aren't more questions, the room

                4 is getting very hot and it is time for coffee.

                5             Fifteen minutes, please.

                              (Recess.)

                7             DR. MARGULIES:  Could we reassemble, please?

                8             I think if we get started again on the council

                9 agenda we can move along.  There are several people who have

              10  to leave early and we want to get as much business out of  the

              11  way as possible before we go.  I am going to shorten some of

              12  the things which I had planned to tell you because they are going

              13  to come up again in relationship with the review processes and so

              14  we will skip over them.  We will be talking about the

              15  emergency medical system applications and the distinction between

              16  what we are reviewing and the contract activities. We  can  do

              17  that when we get to those reviews so you are clear about it.

              18  I can at that time also let you know who the subcommittee

              19  members were for the various special supplementary grant  review

              20  processes which were carried out.

              21              I would only like to make one special point about
              22  the educational activities which are going to be under  review

              23  for supplementary award. We are not empowered to  support  some-
              24  thing called an area health education center but that is  around

  A,ce- Federal Reporters,  Inc.
              25  a very clear cut definition of what the area health center  is





   eak 2                                                                           63



                 1 and that definition  is  tied  closely  to  the  original  Carnegie
                 2 Commission record which describes the AHEC as the satellite,
                 3 of the university health  science  center  with  the  understanding
                 4 that the recipient is the  health  science  center  which  develops
                 5 a collateral activity in a community and has the general
                 6 managership of it on  the  training  of  undergraduate  medical
                 7 students, residents, and other graduate physicians in primary

                 8 medical care.
                 9             We have invited as a consequence, applications
               10 Iwhich are really carried under  no  particular  title  and  believe
               11  me we are better off without a title  for  a  number  of  reasons
               12  but which  are  community  based, which are an  extension  of  RMP
               13  activities of  the  past  several years and which deal with
               14  certain  educational  goals  that are appropriate to RMP.
               15              We will get  to  them in the  very  near  future.  These
               16  primarily came out of the St.  Louis  conference  and  --  with
               17  the coordinators and the number of discussions we have had.
               18              There is, however, one  action  which  the  council
               19  is being asked to take.  The last time which the council met it
               20  agreed to -- I would like to have you look at tab No. 8 on this
               21  one.  Congress agreed to delegate to the director of RMPS the
               22  authority to provide funds for  the  planning  of  area  health
               23  education centers with  certain  limitations,  $50,000  for  each
               24  one, a maximum of five such  activities  in  any  one  regional
  @ce -Federal Reporters,  Inc. medical program.
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    eak 3                                                                      64



                 1            MR. BAUM:  It is community based education criteria.

                 2            DR. MARGULIES:  Sorry.  I was thrown a curve.

                 3 Community based education activities which is not their title.

                 4 That is just a way of locating them.

                 5            DR. PAHL:  The document being referred to is behind

                 0 the tab delegation of authority which is about half way through

                 7 the black binder.


                 8            DR. MARGULIES:  At the time you met, you did

                 9 delegate the authority to provide for some planning activities

               10  for what were called area health education centers and since


               11  we Are not doing them, we are asking you to change that

               12  delegation to one which refers to community based education

               13  activities for the same purpose.  It is really a matter of

               14  new language and conforming to our new position.

               15             MRS. WYCKOFF:  I move we change the language and --

               16  area health education centers to community based indication


               17  programs.


               18             DR. MARGULIES:  Mrs. Wvckoff ha    ved that this

               19  delegation be altered as indicated in the tab in your book.

               20             DR. OCHSNER:  Second the motion.

               21             DR. MARGULIES:  It  as been seconded.  Any further

               22  discussion?

               23             MRS. MARS:  I don't quite understand the reason for

               24  this.
  Ace-Federal Reporters,  Inc. DR. MARGULIES: The reason is to allow us to respond
               25





  !ak 4
                                                                                65


                1 to early planning activities, Mrs. Mars, during the cycle when
                2 the program might be ready to plan something, nine  or  ten
  0             3 months ahead of the time when it would be coming in for its
                4 regular review processes and since it is a  relatively  new

                  activity in some regions, it would be delayed up to a  year  in
                5
                  what is an early planning or      feasibility activity unless
                0
                7 we can provide them with the  funds to do that  earlier.  Some-
                8 times it would also run into conflict with the -- when their
                9 award level is at the level of the council approval and they
               10@ say you have to wait until it is time for their  review  to
                  come in which would slow them up too much.

               12             MRS. MARS:  Thank you.

                              DR. MARGULIES:  Any further discussion?  All in
               13
               14 favor say "aye."
               15             (Chorus of ayes.)
               16             DR. MARGULIES:  Opposed?
               17             (No answer.)
               18             DR. MARGULIES: I would like to recognize  the  fact

                  Dr. Scherlis has come in.  He is on the review committee an
               19
               20 will be here for the discussion of the applications for
               21 supplementary awards for emergency medical care.
               22             I wonder if this would not be a good time to as
               23 Mr. Chamkqiss to bring you up to date.
               24             DR. CHAMPLISS:  As a matter of special interest,.
  A,ce- Federal Reporters,  Inc. the council staff felt that the council would like  to  be
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       eak 5
                1  apprised of the new review committee memberships.  As of June 30th,
                2 @there will be four members of the committee retiring,  Dr.
                3 Michael Spellman, Dr. Gerald Besson, Dr. Philip White and the

                4 past chairman of the committee, Dr. William Mayer.

                5 All will be leaving the service of the review  committee.  That

                6 will leave four vacancies on the committee and the need for  the


                7 appointment of a new chairman.  That new chairman will be Dr.

                8 Max Schmidt who has served with a great amount of distinction

                9 already on the review committee.  Dr. Max Schmidt.

              10              Also there has been one appointment to the committe@

              11  that has been formally accepted.  That person is Mrs. Maria

              12  Flood from El Paso, Texas. There are two other names  that  have

              13  already been approved but it would be injudicious at the  moment

              14  to give them until that process has been fully completed.

              15  Those two appointment will be made, hopefully, soon.

              16           . 'Another matter that it was felt the  council  would

              17  be especially interested in has to do with a question that

              18  arose from the Washington-Alaska regional medical program having

              19  to do with the use of the proceeds of a grant activity  covered

              20  by or supported by regional medical programs.  They raised

              21  a question as to whether that could be granted to them for  the

              22  benefit of a private company, the Video Record Corporation,

              23  which we understand is a subsidiary of RCA. They asked  a  ques-

              24  tion as to whether that corporation could be given a  non-exclu-
  kce -Federal Reporters,  inc.
              25  sive right to duplicate and then sell the proceeds of some films






                                                                              6 7


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                1 that were made under a RMPS grant. We felt this was  a  policy

                2 issue and it was submitted to the office of the general council

                3 for determination.

                4              We took the position in RMPS that whatever was

                5 most favorable to the regional medical program,, we would support

                6 that position and in our inquiry made to the general  council,

                7 a decision has come forth which is, in fact, favorable to  the

                8 RMP.  They asked the -- the question was raised and they answerer

                9 it with three answers.

              10               First, they said that the grantees of RMPS funds ma@

              11  produce and distribute video tapes or the proceeds of those

              12  tapes which were -- which were the -- which were funded through

              13  RMPS without prior review by RMPS.  In other words, they can

              14  make a distribution of the proceeds of grants, tapes, films,

              15  and so on without our approval.
              16               However, they did say that these items were  items

              17  of property and that the distribution -- the use of property

              18  was a matter for the grantee institution to decide and not  for

              19  RMPS to decide.
              20               The second question they raised -- they dealt
              21  with, that since the proceeds of video tapes are  copyrightable
              22  materials, that this -- these copyrights to be subjOct to  the
              23  right of RMPS to a royalty-free non-exclusive irrevocable
              24  license for the use of the video tapes. This means  that  PMPS
  @ce -Federal Reporters,  Inc. would have a property interest in the tapes and that this
              25






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                1 property interest would come to RMPS royalty-free and at no
                2 @ cost .
                3              The third point that they dealt.with had to do with

                4 royalties or the proceeds, the monies coming from the use of

                5these tapes. The general council office finally said  that  all

                6royalties or other fees received by the grantees from the use

                7or distribution of video tapes produced with grant funds up  to

                8the amount they charged to the grant for the production of

                9video tape, that is to say there would have to be a  recoupment

              10 by the RMP of the exact amount of money that was put in it

              11 supported by a grant and after that amount was recouped, then

              12 that amount would have to be refunded to RMPS but it went

              13 on to say that RMP should look favorably upon the use of  those

              14 funds that were recouped for the continuation of other grant

              15 activities.

              16               So, here we have a policy determination by the
              17 general council office on the use of the proceeds of grant funds

              18 in the area of video tapes and films.

              19               We think that this is something of an advancement
              20 of the RMPS mission because now after the recoupment, the
              21 proceeds of activities supported by grants can be used  further
              22 for the supporting of other grant activities, assuming, of

              23 course, this has been cleared by RMPS.

              24               Thank you.
  kce -Federal Reporters,  Inc. DR. DE BAKEY: You say that the money can be used,
              25






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                1 the proceeds could be used for the advancement of the RMP pro-

                2 gram.  Do you mean that once the amount of money that the RMP

                3puts into the program has been returned, that total amount,

                4then what happens beyond that point?

                5              DR. CHAMPLISS: It means that the grantee can  use
                6that amount, can use the further proceeds to further its

                7activities.

                8              DR. DE BAKEY:  Can or will?

                9              DR. CHAMPLISS:  Can or should.

              10               (Laughter.)
              11               MRS. MARS: For the same purpose, in other  words,

              12 to make further films?
              13               DR. CHAMPLISS:  Or for whatever purpose --
              14               MRS. MARS:  Any purpose?  It doesa't necessarily
              15 have to go back and make further films?
              16               DR. CHAMPLISS:  That is right.
              17               DR. SCHREINER:  What happens to the recouped money?
              18               DR. MARGULIES: That becomes RMPS money which  you
              19 can leave there or bring back in.
              20               MRS. MARS:  Doesn't have to be used apparently
              21 to make further films, for any program activity.
              22               DR. MARGULIES:  At this point, the amount involved
              23 is not going to represent a windfall but the issue is of broader
              94 importance when you think of the potentialities in various
  kce - Federal Reporters,  Inc. programs for bringing fundsin, particularly, demonstration
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                1  activities involved in patient care, for example.

                2             DR. DE BAKEY:  It seems to me that this sort of

                3is not really a very clear policy.

                4             DR. CHAMPLISS: I would agree  there.  We  understand

                5that further clarification of this policy is already in the


                0making.

                7             DR. MARGULIES:  Mike, it is a legal opinion.

                8             DR. DE BAKEY:  That is why it is not clear.

                9             (Laughter.)

              10              MRS4 WYCKOFF:  Sounds like we are going into the


              11 grocery business.

              12              DR. MARGULIES:  If there are no further questions

                 on this, I do want to return to that important document and

                 regulations which I think is of very high interest to the

                 council.

              16              DR. PAHL:  In recognizing that a number of people

              17 will not be here tomorrow, I feel it important to take up

              18 a number of documents that we have either sent to you or have

              19 in your folders and I will try to highlight the aspects  for  you

              20 which I believe we want to call to your attention and leave the

              21 rest of it for your more leisurely perusal later on.

              22              DR. DE BAKEY:  Could we get some clarification

              23 before we start on where these proposals stand?  None of them

              24 have been published?

  kce- Federal Reporters,  Inc.
              25              DR. PAHL:  No.  Let me say for the benefit of you and

                .1                                                               -




  eak 10                                                                             71


                 1 particularly the new members of  the  council,  we  have  a  tab  in

                 2 the middle of the black binder called proposed regulations

                 3 and it is titled first draft regulations and it means just

                 4 that. These have  not  been  issued.  They  are  in  draft  form  and

                 5 the thing which I was going to end up on, I will say now we
                 6 earnestly request that  you  look  at  these  today,  tomorrow,  and

                 7 take this section back with you if you will, look  hem over,
                 8 and sometime within the next two to three             we would
                 9 appreciate any constructive comments, additions, deletions,
                10 and so forth in writing from you and the letter can be

                11 addressed to Dr. Margulies or to me.
                12                We will then take  whatever  comments  you  have  and
                13 begin work with the general council office in developing the
                14 final regulations which will  then  have  to  be  published  in  the
                15 Federal Register subject  to,  again,  a  time  period  for  comment

                16 to come in from anyone in the country.
                17                Again, any modifications  made  on  that  basis  have
                18 to be published. So we  are  at  the  stage  where  these  are  truly
                19 draft and nothing will be  done,  I  would  say,  until  the  latter
                20 part of June in  working  again  with  the  general  council  office.
                21 We would like to have your comments.
                22                DR. DE BAKEY: One  question,  that  is  how  do  these
                23 differ from what has been published so far in the Federal

                24 Register>
  kce -Federal Reporters,  Inc.   DR. PAHL:   This is really an updating of the
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                1  earlier regulations, taking into account our mission statement

                2 which was endorsed by the adminstrator and his council a year

       7        3ago and also putting into effect

                4


                5


                6


                7


                8


                9


              10


              11


              12


              13


              14


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              18


              19


              20


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              23


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    #8-ter-1
                I             DR. DE BAKEY: The reason I want to know is  I  think
                2  in evaluating these regulations, we would like to know, you
                3  know, what has been published in the Federal Register, or at
                4  least, be able to bring it up to date.  What are the changes?
                5             MRS. MARS:  Yes.  What are the changes?

                6             DR. PAHL:  Let us ask Ken.
                7             DR. MARGULIES: One point that should be  made,  how-
                8  ever, is that back of this lies the decision to move  away  from
                9  the excessive use of what are called guidelines, to the use  of
              10   regulations which are published and which allow public access
              11   and comment, so much of what we are entertaining here has  been
              12   carried under guidelines which are not really regulations.
              13              DR. DE BAKEY:  We went through a lot -- in the
              14   early days, went into the Federal Register, and I just wante
              15   to be sure we are brought up to date on the relationship of
              16   these to what exists now in the Federal Register.
              17              MR. BAUM:  Let me explain what has been done.
              18              The regulations that we have now are the  regulations
              19   that were originally promulgated from the program and have  not
              20   been changed since 1965, or whenever they were pushed  through.
              21   There was a need to do really two things with these  regulations
   0          22              one was to:bring them up to date so that the requ-
              23   lations are consonant with the new law that we are currently
              24   operating under. That made a number of changes,  broadened  some
  @ce- Federal Reporters,  Inc. of the statements of purposes, widened the representation
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    ter-2
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                1  required on regional advisory groups, completely changed
                          ,I to
                2 Section<W, added construction, and those are not reflected in

                3 the currently applicable regulations that were passed back  in

                4 1965.  So, these regulations are designed to close some of those

                5 gaps-
                6            The second thing is that within the last year,  the
                7 Secretary has issued a directive that instead of  promulgating
                8 policy, you make the rules for your program in a formal  and
                9 official manner, by putting things into regulations as opposed
              10  to having policy statements, which can be changed by  staff,

              11  day-after-day.
              12             And, in order to go through the rule-making  proce-
              13  dures we have required first of all, by law, to consult with the
              14  Counsel. Secondly, the departments'  rule-making  procedures
              15  require that anything you are going to make a regulation  be
              16  published in the Federal Register and there be an  opportunity
              17  for people to comment on those for 30 days.
              18             That they then be finalized and possibly  changed
              19  substantially, republished for comment for another 30  days.
              20  But they are finalized 30 days afterwards.  Nowl these regula-
              21  tions take into account the changes that were made in the  law
              22  and in addition to that, they try to incorporate some of the
              23  materials that reflect the way the program is currently be  ng
              24  operated.
  @ce -Federal Reporters,  inc@ For example, the mission statement that was developers
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    ter-3
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                1 what was it, Herb, about a year ago; the review process require-
                2@ ments and standards which we have put out saying what the local
                3 regional medical program must do in order to meet the standards
                4 for reviewing their own projects, and things like  this  have

                5 been built in.
                6            The document you have in front of you  was  drafted
                7 up in the presumably proper legal language, by the General
                8 Counsel office, after they have taken a look at these program
                9 documents and then built them into this.
              10             Since they gave us their first draft, we have
              11  developed some additional papers and some  additional  things
              12  and they are kind of reflected on some language on  the  back
              13  page of the draft, which we wrote up and they have to  be  put
              14  into appropriate legal language.
              15             That, essentially, is what we have been doing with

              16  these.
              17             DR. MARGULIES:  Iihink it is also fair to say, that
                  at least some of the detailed relationships were never spelled
              18
              19  out in prior guidelines with the specificity that is in here.
              20  They have been left to sort of definition, as we  went  along.
              21  We have had a variety of understandings. The  effort  here  is
              22  to put them in very specific language with  the  understanding
              23  they may, or may not be acceptable.
              24             MRS. MARS: Excuse  me.  This  will  provide,-then,
  \ce- Federal Reporters,  Inc. all the mission's statements, the guidelines? These will  be
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                                                                            76

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                I  torn up as bits of paper and it will all be in here?
                2             DR. PAHL: No. No.  These  represent  the  published
                3  regulations and the more detailed statements such as the missior --
                4  the mission statement per se is not incorporated in here.
                5             The concepts of the mission statement are.  The mission
                6  statement itself, will still be utilized as a program  document
                7  but it would not have the force of a regulation.

                8             Now, in returning --
                9             MRS. MARS:  What about the guidelines?
               10             DR. PAHL:  Our guidelines will return to being
               11  guidelines and those things which are requirements will be  put
                   in the form of regulations.  So, anything which ends up as
               12
               13  a regulation will be a requirement placed upon a regional
               14  medical program, and an,tldditibhal implication and understand-
               15  ing, policy matters, will come out as guidelines if there  is.,
               16  some degree of interpretation and flexibility possible.
               17             These will be firm program requirements.
               18             MRS. MARS:  This is really a finalized situation,

                   so to speak?
               1 9
               20             DR. PAHL:  And they represent the firm program
                   requirements, organizational structure, priorities, things  of
               21
   0           22  that nature. We will still be issuing guidelines,  and  policy
               23  statements, but they would not have the force of a  regulation
               24  in terms of placing a strict requirement on a RMP.  You need
  kce- Federal Reporters,  Inc. You need both.
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    Ter- 5                                                                 7 7



                1            DR. MARGULIES:  There are two practical advantages
                2@ to this, aside from the content.
                3            one of them is that it now allows the guidelines to

                4 be guidelines instead of being both guidelines and regulations

                5 which has confused regional medical programs regularly.

                6            Secondly, it will allow us to have the force of

                7 real validity when we deal with aberrations in the internal

                8 management of a regional medical program, such as a Grantee

                9 Regional Advisory Group relationship which does not fit our

              10  understanding.

              11             At the present time, all we can refer to is the

              12  broad language of the legislation, which is too  nonspecific,
              13  or guidelines when there is authority.  When there is violation,
              14  the regulations will give us a firmer basis for carrying out the
              15  will of the council as expressed through those regulations.
              16             MRS. WYCKOFF:  On the other hand, these ate frozen?
              171            DR. PAHL:  They will be frozen.
              18             DR. MARGULIES:  They are not readily changed.
              19             DR. PAHL:  This is why they are written by the
              20  General Counsel officer in appropriate legal language, as  we
              21  as the fact that they are broadly written, so they would  not
   0          22  have to be changed from day-to-day.  they are not frozen in
              23  the sense they cannot be changed.
              24             It is just that one has to go through the  Federal
  %ce - Federal Reporters,  Inc. Register procedure for any modification, and this is some Month@
              2 5




    ter-6                                                                   7 8


                1 of work and so it would not be advisable to  include  in  this
                2  language of such a specificity that it would be out  of  date

                3  three weeks from now.
                4             MR. MILLIKEN: Are these more  appropriate  than  a

                5  sight-visit?

                              DR. PAHL: If questions come  up,  these  represent
                0
                7  program requirements and so serve as a reference point for the
                8  program. They are the force of law.  An  RMP  must.  But  there
                9  will be additional guidelines and so forth for sight visits,
               101 etc.
               11             DR. MARGULIES: It is -- as a  way  of  illustration,
               12  some amplification, all that the law says is that  the  Council
               13  will consider an application which has been submitted by regional
               14  advisory group.  It does not say, in our legislation, what the
               15  role of the grantee is in determining the  responsibility  of
               16  that regional advisory group, what the extent of its responsibiLit)
               17  is, or what the limitations are.
               18             That is why you have regulations to  identify  the
                   intent of broadly-stated legislation. Then, the  way  in  which
               19
               20  you make that -- make sure that functions is the way.
               21             You have three levels.  Basic-logislation And regu-
   0           22  lations, and guidelines, which are much more a matter of the
               23  management.
               24             DR. PAHL@:  I can illustrate,that,, I had not planned
  kce- Federal Reporters,  Inc. to do it in this order, but if you look at the last  page  of
               25






                                                                            7 9

    ter-7

                1  these suggested regulations, it is not numbered, it is after
                2@ page ten in the document, Section A is titled "Grantee  Coordi-
                3  nator Relationships."  Please do not read it at the moment.

                4             What I want to do is point out itlis a brief para-
                5  graph in rather broad language. I will call to  your  attention
                6  in a moment, that in your folder there is a four-page  document
                7  which spells out in much greater detail than we would want in
                8  regulations, the actual roles and responsibilities of the  RAG.

                9             The coordinator and the grantee.  This would be a
              10   good example of how the regulations give a firm requirement
              11   of a conceptual nature, and the subsequent guidelines  interpret
              12   and give much more specificity and give a basis for actual

              13   program operation.
              14              Now, I would like to call to your attention, for
              15   consideration now or at your pleasure, at this meeting and  cer-
              16   tainly subsequently to this meeting, in terms of writing us
              17   comments; Section 51(b) on the bottom of page three and most

              18   of page four.
              19              This is the section entitled, "Priority of  Regional
              20   Medical Programs,@r and consists of a listing of items which you
              21   may wish to consider. Again before you read this, I  would  like
              22   to go through the whole little presentation. Then we  can  come
              23   back; otherwise you would not get the whole perspective.
              24              This section is of specific interest to the  Council

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    ter-8                                                                  80


                1  evidenced by this morning's discussion.  It has to do with priol-
                2  ities, which would be published and of some force of  require-
                3  ment on regional medical programs.  That section is particularly

                4  important.
                5            Most of the sections have to do with  the  mechanics

                6  of the program, and I do not think we will do violence to  any-

                7  thing that we are accustomed to.  And the last page, the
                8  suggested additions to the proposed regulations, has a  section

                9  on the Grantee--RAG coordinator relationship.

              10             It has a -- this is the last page of  the  document,
              11   page eleven.  It has a section ont and a section on con-
              12   struction. These would be new parts of the  regulations  which
              13   have been added as a result of the authority under our  present
              14   law, and program decisions made subsequent to the enactment  of

              15   the legislation-.
              16             1 would like to indicate the following:  It is diffi-.
              17   cult to know how these relate to what has already been
              18   and, Xen, we can get copies of what are now the present  regu-
              19   lations, and give them to you at this meeting, or get them  to
              20   you immediately in the mail; so that you will see what are
              21   our present regulations, published regulations, and then  send
              22   you also, a copy of this so you will be able to compare.
              23             This is what the General Counsel  Office  did.  They
              24   took our present regulations, our present legislation# and  the
  kce- Federal Reporters,  Inc. important policy documents that have been developed by us,  and
              25




    ter-9                                                                  81


                1  developed this revised set of regulations, proposed regulations,

                2 from a consideration of all of those.  We would b&;most happy
                3 to have you review, whether you think the present regulations aiLd
                4 what you know to be the direction of the program and the documents,

                5 whether these are accurately reflected.

                6            We do earnestly solicit your comments here or

                7 written comments upon your return.
                8            Now, having said that, I would like to ask whether il.
                9 would be your pleasure to go over that section on page three,

              10  and foru, now-or whether-perhaps, you would like to have an
              11  opportunity to review this over lunch hour, or something and
              12  take some time this afternoons after you have given it some

              13  thought?
              14             Clark, you raised the issue with me?
              15             DR. SCHREINER:  Bear in on it.

              16             DR. PAHL:  Okay.
              17             open for discussion.
              18             DR. DE BAKEY:  The first question I want to ask, is
              19  in relation to the priority.  Are these listed in any order?
              20  Because that is not clear the way it is stated here.  In other
              21  words, you have given some indication of what constitute priori-
              22  ties, but what is not clear is whether these represent priorities
              23  themselves.  In other words, does, for example, under 51(b 106,
              24  Paragraph A, and then Section One, does that have priority over
  kce - Fedefat Reportefs,  Inc. Two?
              25



    ter-10                                                                    82


                               MR. BAUM:  As I recall, and I do not have the docu-

                 2 ment in front of me, these priorities were taken out of the

                 3 mission statement of a year ago.  I do not know if they used
                 4 exactly the language of the mission statement or rearranged it.
                 5             I would have to compare it.  But essentially, what

                 6 we did was to furnish the General Counsel Office with tome
                 7 documents like the applications statement, some others that 1

                 8 mentioned, and they took those documents, extracted from them,
                 9 and put them into what they feel is the correct legal form, And

               10  I think that is where you get this set of priorities.
               11              I would have to look at the mission.'s statement.  It

               12  was done by the Legal Department, not by us.
               13              DR. DE BAKEY:  If I recall, the mission's statement
               14  was just a listing with no intent to give priorities to the

               15  mission.
    End #8     16              DR. MARGULIES:  I do not think there is an intent.

               17


               18


               19


               20


               21


               22


               23


               24

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                                                                                  83
      CR 6499


     Take 9       1              MR. BAUM:  No.
     dw 1         2              DR. PAHL:  There is not an intent but this is not

                  3  clear.
                  4              DR. DE BAKEY:  You are dealing here with priorities

                     not with mission.
                  5
                  6              DR. PAHL:  That is correct.  It is not clear here

                     and we,would dlatify'it.
                  7
                  8              DR. MILLIKAN:  Looking at A, there are eight
                  9  items, and  in five of the eight, the word "care" is a key

                1 0  word.
                11               Could we have a definition of i
                12               Items 1, 3, 6 and 7, the word               ears.
                13   I think that is important enough that it           even want to
                14   be included under 51-B-102.
                15               DR. PAHL:  Section on Definitions.
                16               DR. MILLIKAN:  I would like to hear some discussion
                17   on it.
                                 DR. DE BAKEY:  I think this is important because
                18
                19   I don't think there was any -- that there was ever originally
                20   or in the new law that carried on the regional medical program,
                21   certainly, a concept of providing any care that would, say, be
                22   the type of medical care we usually speak of as reimbursed

                23   care.
                24               So it becomes rather important, I think, to
   Ace - Federal Reporters, Inc. distinguish this type of care.
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                                                                             84
    dw 2


                 1             DR. MARGULIES:  You need to describe -- I think

                 2  what it is and what it is not.

                 3             What it is not is payment for services and what

                 4  it is needs to be defined in some aspect of health services

                 5  delivery.

                 6             DR. ROTH:  It also makes reference to primary

                 7  and secondary care and this has been subject  to  various

                 8  definitions, depending on what you are talking about.

                 9             I think primary and secondary care  should  be

               10   defined.

               11              DR. DE BAKEY:  Now, in paragraph 4, that same

               12   area, this is a question which I am asking because I think

               13   it is important.

               14              In the Mission statement, under Paragraph 4, where

               15   it says "need to increase utlization," and then  it  says

               16   especially.

               17              Now, I think the reason I bring this up is because

               18   that adds in a sense to the priority.

               19              I want to know if that is in the original Mission.

               20   If not, we have added something to it.

               21              MR. PETERSON:  I am pretty certain and I can get
  0            22   some copies of the Mission statement.

               23              DR. PAHL: We will get copies  of  the  Mission


               24   statement.

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                                                                                  85


     dw 3         1  it doesn't have to be in the regulations, if it is council's

                  2  opinion or the opinion of the public at large that this should

                  3  not be in the regulations.

                  4              So we are not bound by that, whether it exists

                  5  or not.


                  6              DR. DE BAKEY:  The only reason I am concerned

                  7  about it is because it, in a sense, provides a form of

                  8  priority.

                  9              DR. PAHL:  Yes, it does.

                10               DR. DE BAKEY:  I am not at all sure that that ought


                11   to go into  regulations.

                12               Priorities from the standpoint of the councils role

                13   can vary from time to time.  They can vary in terms of the

                14   funds that are available, they can vary in terms of what is

                15   timely and effective.

                16               It may well, for example, prove that -- let's

                17   say allied  health personnel, certain types of allied health

                18   personnel,  does not increase the capability of achieving

                19   the goals of the program.

                20               I am just using that as an illustration.

                21               Well, you would be tied down to your form of

                22   priority in the regulations that would, in a sense, frustrate

                23   council's priorities at that particular time.

                24               So I think it is important to -- in terms of

   Ace-Federal Reporters,  Inc.
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                                                                                  86

     dw 4


                  1  are published in the Register -- to be very careful about the
                  2@ wording of priorities.
                  3               You see, this comes -- this is really the whole

                  4  sort of heart and core of a councils role.  This is --

                  5  you are almost saying, well, you know, you are almost -- you
                  6  almost don't need a council if you set up a set of priorities
                  7  that is so rigid that you can have a bookkeeper take care of

                  8  it for you.
                  9               I think -- I personally think it extremely important

                 10  to word this in such a way that ther
                 11  provided the council in exercising j                         ties.

                 12               DR. PAHL:  Yes.
                 13               MR. HIROTO:  Would it be necessary to list the
                 14  priorities   at all?  Couldn't it just be listed as

                     areas o


                                  DR. MARGULIES:  Actually, if you read it, they are
                 1 6
                 17                        hey ar        basis  for   determining---@,@

                 is          ies.
                 19               I think the point that Mike  has  made  on  this  one
                     is one that we would like an expression of council opinion
                 20

                 21  on.
                 22               You can leave it as it is,  you  can  alter  it,  you
                 23  can delete   it.
                 24               I think this is as good a time as any to consider
   Ace -Federal Reporters,  Inc. which way you would like  to  go  because  you  are  quite  right.
                 25





                                                                           87

    dw 5


                 1            It does single this out particularly with the word

                 2  "especially," which raises it to a higher level.

                 3            DR. DE BAKEY:  Well, Harold, I wish you had had

                 4  more of an illustration.  I am very much concerned about

                 5                                     f priorities.

                 6            I think once you have these established in the

                 7  Register, they assume all the authority of law and you don't
                 8  really have any more capability of modifying that law which
                 9  you have now so long as you are exercising judgment within the

                 10 framework of the law, you see.

                 11           Now, you establish  these which, as you say, are

                 12 Missions and bases for determining priority.

                 13           Well, if they are bases for determining  priority,

                 14 then they constitute the Mission.

                 15           Therefore, it is up to the Council to make
                 16 decisions regarding the priority of achieving those missions
                 17 in terms of the applications that it has before it, in terms

                 18 of programmatic discussions, policy, and so on.
                 19           So I am really raising the important question here
                 20 as to whether or not it is desirable to put into regulations,
                 21 really, or into the Federal Register, which, as I say, has

                 22 all the authority of law, a set of priority values or
                 23 criteria that obviously can vary from time to time, but if
                 24 you write them down in the form of law, they no longer vary,

  Ace -Federal Reporters,  Inc.
                 25 they no longer vary.  This it seems to me ties the hands of






                                                                            88
     dw 6


                 1  the Council and I am not really certain that it isn't a

                 2  violation, so to speak, of the responsibility assigned  to  the

                 3  Council.

                 4             That is the real point I am raising here.

                 5             DR. SCHREINER:  What would you think of saying,

                 6  in determining priority of considerations, the Council shall

                 7  take into consideration and then have a paragraph  rather  than

                 8  a list of one, two, three, four,five-, six, seven, eight,

                 9  nine, ten, so you don't get this rank order, and  include  some

               10   of these items that the Council wi                   de    i6n-@,-

               11              In other words, instead                   re,

               12   say the council. That puts it back where you want  to  put  it.

               13              MRS. MARS:  You have to have some criteria,

               14   whether you call it priorities.

               15              DR. ROTH:  I was just going to make a tongue-in-

               16   cheek observation that the moment you put down specifically

               17   these things as priority items, it seems to me that you

               IS   virtually cast in concrete the shape of every grant

               19   application because every good grant man is going to go

               20   down one, two, three, four, five  six, seven, eight, and

               21   cover them in his application.

               22              This is what has been happening to us in  the  past.

               23              DR. PAHL: We are somewhat caught  because  what  the

               24   secretary has said some.@moments ago is that we can't  continue
  Ace - Federa I Repof ters,  Inc.
               25   to issue "guidelines" and operate on those guidelines as if






                                                                                  89


     dw 7         1  they had the force of law without actually giving the public
                  21 at .large an opportunity to  see  that  they  are  being  applied  as
                  3  univorm requirements across the RMPS, so we would be back

                  4  in the same  position  where  our  regulations  didn't  really

                  5  reflect what our true program requirements are.

                  6              Now, I think there is a very good point here

                  7  that we don't necessarily have  to  have  lists  and  one,  two,

                  8  three, four, but if we are going to use these as the

                  9  basic requirements for considering grant applications,

                10   then in honoring the  spirit  of  the  secretary's  mandate,  we
                11   should have something  in  our  regulations  pointing  out  to
                12   applicants what we really are  looking  at  in  terms  of  their
                13   programs which, of course, will be reflected in funding

                1 4  decisions.
                15               MRS. WYCKOFF: I  would  like  to  see  a  definition  of

                     "allied health."
                1 6

                17               DR. MARGULIES:  Come on, now.

                                 (Laught
                @9               DR.  KOMAROFF:  What  about,  as  George  suggested,
                     that paragraph saying very broadly that RMPs are designed
                20

                     to link facilities  and  to  disseminate  information  from  a
                 @21
                22   central source in both  the  category  5  diseases  and  in  various
                23   improvements in the health  care  delivery  system  and  let  it  go
                24   just that vaguely.
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                                                                            90
    dw 8


                 1  sexy  to us@today and you fulfill kind of cheaply the

                 2  mandate of the secretary.

                 3             DR. MARGULIES: We have no objections  to  that,  but

                 4  we also continue to receive considerable criticism which has

                 5  been extended this morning on the failure of the RMPs  to  more

                 6  carefully define what it is they are setting out to do so that

                 7  whether we do it in regulations or somewhere else,  I  think

                 8  we have to make sure that it is understandable and probably

                 9  the part that needs to be underscored and Herb  has  already

                 10 said it, but it needs to be said again, is that this does

                 11 provide for public review.

                 12            That doesn't necessarily mean grantees,  but  any

                 13 part of the public that wants to know what it is the RMP

                 14 proposes to do and want a comment on whether-, they think they

                 15 ought to do it.

                 16            It will probably be followed at sometiihe,ih  the

                 17 future with greater disclosure of this kind of meeting-

                 18            It will be very difficult for someone to look

                 19 at the minutes of this meeting and judge whether some

                 20 action has been taken without some understanding on  the  basis

                 21 of regulations of what it should be.

                 22            It is somewhere between those kinds of demands that


                 23 I think we have to find our course.

                 24            DR. DE BPLKEY:  But Harold, it is one thing to

  Ace-Federal Reporters, Inc.
                 25 set up a definition of Mission in the program and it  is  still

                  I




    dw 9
                                                                             91



                 1  another thing to set up in terms of priorities of  how  you

                 2  achieve that Mission, regulations, really, that are factors

                 3  in making the assessment of judgment.

                 4             DR. MARGULIES: I am not  disagreeing  with  you.

                 5             DR. DE BAKEY:  That is the distinction I am


                 6  trying to make.

                 7             I have no objection, of course, to amplifying in

                 8  some form the Mission in the form of  regulations.  I  think

                 9  that is quite desirable, but I am raising a very serious

               10   question as to whether you allow those then to  become  the

               11   rigid criteria of judgment.

               12              DR. MARGULIES:  I think we could function without

               13   the priority statement.  I am not deeply concerned about

               14   that because that is a temporal kind of thing,  a  formative

               15

                               DR. PAHL:  I think that is an excellent point

                           the Council wishes, because of the major impact that

                    that would have on this statement, rather than have you

               19   respond to this statement more fully when you return, if you

               20   would permit us to revise this section and  resubmit  it  to

               21   for your further comments   d if a definition of  "care"  is
               22   required@, under the revision, to have that included  also,
               23   we would then ask you to look at the revised  statement  at
               24   your leisure at home and write us comments rather than trying
  Ace -Federal Reporters,  Inc. to pick each point.
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                                                                                                                                             9 2

        dw  10


                                I                        We  would  also  go  through  the  statement  very
                                2@    carefully  in  the  sense  of  not  alluding  to  priorities.
                                3                        I  do  not  mean  to  terminate  discussion  on  any  part

                                4    of  the  document.    I  thought  perhaps  I  should  say  we  should  do


                                5    that.

                                6                        MRS.  WYCKOFF:    If  we  were  going  to  do  the  things.

                                7    that  are  listed  here,  it would  mean  an  appropriation  of  at

                                8    least  a billion  dollars.


                                9                        DR.  DE  BAKEY:    Perhaps  we  should.


                                10


                                11


                                12


                                13


                                14


                                15


                                16


                                17


                                18


                                19


                                20


                                21


                                22


                                23


                                24

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                                                                              9 3


      cR-6499                  DR. @,IARCULIJ@S:  That would be one way of getting to
        @io
       nb-1         it.
                 2
                 3             DR. SCIIRI"IiqER:  This gives the procedures for
                 4  approving which are essentially  what the secretary  is  doing.
                    The only value it seems to me in giving priorities  is  to  get
                 5
                 6  the potential grantees who are reading this, have  a  feel  for
                 7  what kinds of things are in mind of the council and I think
                 8  that is why I think that the secretary is going to assign
                 9  priorities in 15-B-06 after first saying that he  is  going  to
               10   approve -- that these are the ways in which he approves the
               11   action of the council and the next thing  says  the  priorities
                    of the council.  That negates the whole purpose of the council.
               12
                    It seems to me, you should have a paragraph saying      even as
               13
               14   a historical statement -- saying the council has given emphasis
               15   to these kinds of things and then the kinds of things mentioned
                    without 1-A, 1-13, 1-C.  It gets specific enough to give people
               16
                    hints about what it is they should apply for but it doesn't
               17
                    say that one is going to be ahead of two or four  is  going  to
               18
                    be ahead of eight.  That is going to be something the council
               19
                    determines.  It is sort of a preamble.
               20
               21              I think it is fine to put down your philisophy even
                    if it is a historical statement.
               22
                               DR. PAHL:  ;-7e will do away with the priority sense
               23
                    and recast this whole section  in a different way.
               24
  4,ce -Federal Reporters,  Inc. DR. ROTH: I would just like to speak  strongly  to
               25






                                                                                9 4

        nb-2          to this and emphasize one thing that those of us who have been
                      going through this presentation of grants have had drummed into
                 2@   us but it hasn't be en mentioned  here  today:  A  program  which
                 3
                 4    would be totally inadequate and be worth  nothing  for  funding
                 5    in sophisticated Boston area may be extremely important in--.

                 6
                 7               (Laughter.)
                 8              DR. ROTH: We have  been  hung  up  on  this  business
                 9    of equating excellence and facilities and so  on  and  so  fort
                 10   to needs. I think we always have  to  remember  what  is  going
                 11   to come up.
                 12             Ilany times in our emergency medical services we are
                 13   told if need is a qualification one program may rate a four or
                 14   a five plus whereas if resources and ability to effectuate a
                 15   nrogram, they are down at the zero level.  We don't want
                      @o iii jini up on these prior- t,--
                                 DR. L@AARGULIES:  I think as Herb indicated we can and
                 17
                      I think these points have  been  extremely  helpful.  There  is
                 18
                 19   one aspect of the regulations that probably has a -- question-
                 20   ably has a higher priority in time  than  anyone  else  because
                 21   we have so many programs hanging  fire  waiting  to  know  what
                 22   we are going to finally do and that has to do with the
                 23   coordinator RAG grantee relationships.
                                 Tlavbe you want to comment on it?
                 24
   Ace-Federal Reporters, Inc.   DR. l@IILLII'@A14: Are we leaving this?
                 25






                                                                              9 5


                                DR. TIARGULIES: 14o. ilot if you want  to  continue
       n]D-3        with it.    DR. PIILLIIUVI:  Even if you change it to goals
                3
                4   missions, et cetera, I think there needs to  be  a  great  deal
                5   of attention paid to each of the items mentioned in the eight
                6   under A. Por'instance, look at  Item  1.  This  is  a  complete
                    change.  I think vou need to go over these things very
                7
                8   carefully.  Item 3 mentions metapl-iores.  ror improved knowledc
                    and treatment.  There is a real mix for you.
                9
                10  you  have  an educational function, on the  other  hand,  you  are
                11  right out there treating patients for funding.  That is a real
                12  dandy.
                13              DR. ROTII: Back up to 2, which  says,  prior  early
                14  increases in reliability or  accessibility  and  moderation  of
                    the costs. I am not sure but what an RI@IP function  is  not  to
                15
                16  moderate the cost but to determine what the  costs  may  be  and
                17  to find 0         the iroblems in funding are.
                                To say that the P21P T)i             to be directed
                18
                    at   moderating costs is a perversion O-f--@tie@ind  o  re@6arch
                19
                    and ti@velo   nt that R14P may  e appropriately doing.
                20
                                DR. IIILLII<AN:  In Item 5, this is where we came in
                21
                22  this   morning. Take a look at Item 5.
                                Here is the authority in our regulations for  lik4O.
                23
                                DR. I.IARCULIES: That would disappear in  any  case,
                24
  Ace - Federal Reporters,  Inc. DR. SCHREINER:  It is interesting that Title 9,
                25






                                                                             9 6


                 1 Diseases are mentioned.
       nb-4
                 2             !)R. PAIIL: Without belaboring the point, I  think
                 31 I am going to reiterate what 14r. Ilillil-,an has said and this is
                 4 not to throw off responsibility but has been drafted by
                 5 general counsel on the basis of their interpretation of what
                 6 our documents and existing regulations policy guidelines
                 7 criteria and so forth either say or imply.
                 8             To the extent that these words keep in either our
                 9 documents are not sufficiently clear or the interpretation
               10  is too broad for our purposes but I do want  to  indicate  again
               11  whatever revised language we come up with must  go  through  the
               12  General Counsels Office because it winds up to be a legal
               13  document and these words mean more things to us  also  as  staff
               14  than -- we don't have to do everything because  it  is  stated
               15  in the regulations, but these are  the  interpretations  which
               16  General Counsels Office has gotten out of our officially
                   Publicized 'program documents.
               17
                 I             To that extent we have to work back and  forth  an
               18
               19  eventually  come to an agreement, but we take all of our
               20  statements  very seriously.
                               DR. DE BAKEY: Where it gets important  is  when  you
               21
               22  get down to the money.
                               DR. PAIIL:  Of course.
               23
                               DR. DE BAKEY:  I liate to bring up this, but that is
               24
  Ace-Federal Reporters,  Inc. how things get done. The regulations can affect both the
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                                                                            9 7


                   expenditure of the monev and how the money is to be used.  That
         nb-5
                2  is why this becomes completely important.
                              You see, if voia go back to the 14ission statement, yoi
                3
                4  see, that was a kind of a policy guideline and indicating some
                5  changes.  That doesn't have the kind of authority for spending
                   monev that the regulations would have.  That is why this become3
                6
                   so important and that is the point I was making about the
                7
                   rigiditv which regulations once they are published in the Fed-
                8
                9  eral Register become  the rigid guide they become on how you
               I 0 spend the money.
               11             DR. PAIIL:  Well, I think speaking on behalf of the
               12  staff and all those who participated in this, we not only
               13  recognize but understand the statements, will recast this
                   and will be again very appreciative of additional comments
               14
                   after we send you a revised version.
               15
               16             It is important and we are truly seeking council
               17  participation before we get to this point.  of course, even
               18  after council has approved and general counsel has approved
               19  to whatever the final wording is and it gets published in the
               20  Federal Register, there is still time for the public At
               21  large and yourself to take exceptions to statements.
               22             ll(-@ will have time after publication for time to
                   review and come i n .
               23
                              DR. IIARCULIES:  Clark, you have more on that
               24
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                                                                                9 8


                 I              DR. IIILLIKAT@7:  'lot at the moment.
         nb-6
                 2              PIIZ. ',IILLIKEN: I have a question on this priority
                 3  concept. The discussion here it seems  to  me  we  may  be  saying
                 4  two different things. Some of  the  council  may  be  saying  let's
                 5  wine out the priority concept, you know, let's not go it.
                 6  I hear staff saying, perhaps,  council  along  with  everyone  else
                    is stuck with a priority responsibility, but how this is worded
                 7
                 8  is the fine difference.
                                DR. l@,@IARCULIES: If I get the sense of the  council,
                 9
                1   what they are saying is that the establishment of priorities
                    is something which must be determined by the council with
                I
                12  recommendation to the secretary,  obviously  you  cant  leave  him
                13  out, he is the person who has the  authority  to  spend  the  money
                14  but this is something which we should feed in the language
                15  which indicates it is the  responsibility  of  council  to  address
                16  priorities and to make those priorities well known to the
                    the public and regional medical programs in conformity with
                17

                    the law.
                18
                19              That is a much more comfortable  position  to  be  in.
                20  So you may  find if you go back over this ilission statement,
                21  I think you will find if you reread it that you would like
   0            22  to amend it now.  It is a year old and it
                23  revision.                         @z
                                DR. PAIIL:  If we are finished wit          scussion on
                24
  Ace-Federal Reporters,  Inc. the regulations, I would like to turn your attention to two
                25






                                                                            99


      nl)-7     I  documents in the manila folders at your desk  because  this
                2 @should follow closely upon the  present  discussion.  There
                3  should be a manila folder at your desk.

                4             A separate manila folder and behind the --

                5             The first statement is beyond two maybes of  how  to
                6  get to coffee and supper, is a statement  called  Governing
                7  Principles and Requirements Discretionary @IP  Funding  dated
                8  May 26. This is for information purposes for you  and  at  this
                9  point has not be distributed beyond some of our own  staff  and
               10  to vou. It is a statement which tries to  set  forth  generally
               11  applicable principles and gives those  specific  conditions
               12  under which M,4Ps must obtain approval from headquarters  staff

               13  for certain specific kinds of rebudgeting in their programs.
               14             This is not the development of new policy.  It is
               15  trying to put into  written form the principles which we have
               16  been following and I  would call your attention primarily  to
               17  the fact that we have  made a separation between those lu4Ps
               18  which are within the  three year triennial -,oeriod and those which
               19  have not yet been  approved for a triennial period, but  that
               20  governing both of those kinds of RMPs are a set of four
               21  general principles given at the top of the page.
               22             What we propose to do is have you look  this  over
               23  at your leisure and unless there are some severe changes
               24  which should be made, we nropose to send this out and have

  @ce -Federal Reporters,  Inc.
               25  this as an administrative policy. We  would  appreciate  your






                                                                             100


                    comments now or in the next few days but it  doesn't  represent
        nl)- 8
                    anything which has not been our operating guideline, I believe.

                               Dr. Rotli?
                 3
                 4             DR. ROTII:  Ilay I ask a question?
                 5             The requirements -- prior ltl,4PS approval is required
                 6  in the following instances. allow, would you tell me  what
                    prior P-TIPS approval, what is the methodology of accomplishing
                 7
                 8  this?  IIhat is that?
                 9             DR. PAIIL:  I.,Ihat really happens is that depending upon
                    the nature of the inquiry it would be the  correctors  approval
               I 0
                    alone or would come to the council for example renovation in
               1 11
               12   excess of 25,000 or any now construction.  @,ie would tend to
                    use administrative judgment and if a request came  in  for
               13
                    $3 @-U--zfh-d was appropriated to what the council had intended
               14
                    and h          d through its discussion of the a-
                         ad approve                                  ,)plication,
               15
               16   perhaps six months ago, then we might feel quite  free  to
               17   grant that authority in that specific instance or  even  though
                    it were a small sum, if we had questions, then we  would  bring
               18
                    it back to council for consideration if it were of a policy
               1 9

                    nature.
               2 0
                               We didn't know exactly how to spell out in detail
               2 1
               22   just what the dividing line would be because most of these
                    things you would not wish to have come to your attention.
               23
                               In fact, they have not been large volumes of
               24
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               25 1






                                                                            10 1



                1             Some of these are items, for example, B-1-D on
        nb-9
                2  the end stage treatment of kidney disease@, as you know,  is  a

                3  matter which comes to review committee  and  council.  What  we

                4  are merely saying here in print is that the region may not
                5  embark uT-)on such an activity without first going through  the

                   reaular processes which you have participated in and will par-
                0
                7  ticipate in again today.  But in general it is a matter of --
                8  the way it is written it is a matter for administrative

                9  discretion by the director.
               101            DR. T@IARGULIF5S:  This is sort of a mild level, Russ,
                 I
               11  which you may want to question.  I don't think there should
               12  be any confusion about it. In deciding at what point  of  JUIP
               13  can takelaction on its own, at what point it should be referred
               14  to IUIPS and at what point RMPS, meaning the director,  should
               15  bring it to the council.
               16             In earlier discussions you felt there should be

                   some discretion exercised bv us in bringing subjects of
               17
               18  concern to you and we have tried to spell it out.  You may have
               19  some questions or some misgivings about it which I would feel
      @io      20  very comfortable hearing expressed.

               21
   0           22

               23


               24

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                                                                                 102


     CR 6499                     DR. ROTH:  I just get hung up when I take my
     Take 11     21 first fast look at it and  see  you  need  prior  RMPS  approval
   I*            3   for anything involving, 1B, human subjects.
     dw 1        4               To me that is people.

                 5               MRS. WYCKOFF:  Yes.  What is "human subjects"?

                 6               DR. PAHL:  This is an impossibly difficult area,

                 7   as you  know.

                 8               There is a whole departmental operation and

                 9   regulation for those  kinds  of  federally  supported  projects

                10   which really  involve  human  subjects  for  experimentation.

                11               What we have basically  done  here  is  recognize

                12   in print that there is a  departmental  policy  and  NIH,  of

                13   course, has the most elaborate review mechanism for this kind

                14   of activity and we are merely putting in print for the first

                15   time that there is this departmental regulation, and if the

                16   request came in, which in the opinion of our staff

                17   required departmental approval,  then  we  would  invoke  the

                18   necessary and established mechanisms for providing that
                19   review, namely, through the NIH,  and  an  official  letter  of

                20   approval back.
                21               If the nature of the activity being requested was
                22   such that it did not have to  invoke  such  an  activity,  we
                23   would merely say over the phone,and send a confirming letter,

                24   no approval is required, proceed.

  Ace -Federal Reporters,  Inc.
                25               This is really providing a guarantee to the applica t






                                                                                  10 3


     dw 2         1  that he won't get in trouble later with a departmental
                  2  regulation.
                  3              As you know, it is very  difficult  in  the  area  of
                  4  human experimentation to draw the line.  It involves such
                  5  things as questionnaires and the social and behaviorial

                     sicences.
                  6
                  7              It is not just a medical experimentation.
                  8              DR. SCHREINER:  The word "experimentation" is not
                  9  mentioned.
                10               MRS. WYCKOFF:  What is this immunization?
                11               MRS. MARS:  Why not spell it out more clearly?
                12               DR. PAHL:  That is the problem.
                13               It is not that easy to spell it out clearly.
                14               DR. MARGULIES:  It may not be experimentation.  It
                     may be an  invasion of privacy.
                1 5
                16               DR.  PAHL:  Sending  a  questionnaire  under  certain
                17   circumstances is an invasion of privacy.
                18               To spell out  "invasion  of  privacy"  would  require
                1 9  a tome.
                20               What we are doing is alerting.  This is not a
                21   regulation.  It is an administrative guideline an  we are
                22   alerting applicants, if they are involving human subjects,
                23   they have the responsibility  to  bring  that  to  our  attention
                24   and we can decide whether it is within the scope of the
   Ace-Federal Reporters, Inc. departmental requirements or not.
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                                                                            104

    dw 3

                 1             DR. DE BAKEY:  I think things like that are best

                 2  treated vaguely.
                 3             DR. PAHL:  It is an:extremely complex area.
                 4             DR. MARGULIES:  If you were to set up two activities
                 5  and compare the results on health outcome over a period  of
                 6  three years withone group getting what you think is good
                 7  treatment and the other group getting the control, you  run
                 8  into some problems.  You can't just pass that off.
                 9             Maybe it is an experiment, maybe you should  say
               10   leave that group the way it is,that is not an experiment.
               11   This is the time we need to bring it back in for Federal revieu.
               12              There have been rules written to cover that.
               13              DR. PAHL:  There is a body of regulations covering

               14   that area.
               jl5             We don't propose to duplicate it.
                           This is for your information only, but if there are

                    comments in the next few days, we would appreciate having them
               18              otherwise, we will have this as an issued
               19   document.
               20              The second document is one I do wish to call  to
               21   your attention very seriously.
                               it is the RMPS policy concerning grantee and

                    regional advisory group responsibilities and  relationship,

                    also dated May 26.

  Ace -Federal Reporters,  Inc. There is a covering memorandum of May 26 on that
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                                                                           10 5
    dw 4



                   document.


                              Mr. Margulies referred to this earlier and  the

                3  reason we want to call to your attention this document  is

                4  that again this would not be a regulation, it would be  an

                5  elaboration of what that paragraph in the proposed regulations

                6  intends to say and what it proposes to do is spell out for the

                7  first time in the history of the program what headquarters

                8  and council, because we seek your endorsement of this,  what

                9  headquarters and council feel to be the proper  relationship

               10  between the grantee and the regional advisory group.

               11             As you know and as will become more clear in  the

               12  course of the meeting, this time there are serious  problems

               13  which arise because of lack of clear guidelines as to what

               14  the roles and relationship of the grantee, the coordinator

               15  and the regional advisory group are or are intended to be.

               16             We have a number of problems now because of  lack

               17  of understanding or lack of agreement as to what those applied

               18  understandings are.

               19             This document@ makes it very cleat that there are

               20  two legislativly established units in a regional medical

               21  program, namely, the regional medical group and the

               22  grantee.

               23             Tradition, custom, history and practicality  have

               24  established the coordinator or the director of the  regional

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               25  medical program as the third important unit in this  local

                  I





                                                                                  106


     dw 5            organizational framework but he is not mentioned in the

                     legislation and in this document  we  have  placed  the  responsi,-
                  2
                  3  bilities and role of  the  director  or  the  coordinator  under
                  4  the title Chief Executive Officer and have that as a
                  5  major subsection of  the  grantee  because  the  coordinator  is
                  6  an employer of the grantee.
                  7              What this document therefore intends to do is to
                  8  try to set forth  as  clearly  and  unambiguously  as  possible,
                  9  and has gone through  numerous  drafts  and  has  been  approved
                10   at this stage by the HSMHA branch management policy officer
                11   so that unless otherwise changed, it has the approval of
                12   HSMHA and would be a HSMHA policy as well as an RMPS policy.
                                 I want to call to your attention three things
                1 3
                14   in this document.
                15               The first is -- on the first page, under Section

                     B, Grantee, the key statement.
                1 6
                17               The grantee organization is charged with the
                18   responsibility as follows:
                19               The grantee orqanization-.@shall manage  the  grant  of
                20   the regional medical program  in  a  manner  which  will  implement
                21   the program established  by  the  regional  advisory  group  and
                22   in accordance with Federal regulat   ions and policies.
                23               This statement, together with supporting
                24   statements under  the  section  titled  "Regional  Advisory  Group"
  Ace-Federal Reporters,  Inc. later in the document clearly sets forth the regional
                25






                                                                            10  7
    dw 6

                 1  advisory group as having the responsibility for  establishing
                 2@ the program.
                 3             It is not the grantee, it is the regional advisory

                 4  group.
                 5             That is a very important point which,  took:some
                    degree of discussing as the document was being formulated and
                 0
                 7  redone.
                 8             The second -- well, let me follow that up by

                    saying on page three, under the regional advisory group, to
                 9
               10   make sure there is no misunderstanding, the overall
               11   responsibility of the regional advisory group is stated  to
               12   be "The regional advisory group or RAG has the responsibility
               13   forr setting the direction of the RMP and formulating program
               14   policies, objectives, and priorities."
               15              Now, the second point which I wish to direct  your
               16   attention to again is on page 1 under grantee and that is
               17   Item 3, first of all.
               18              That is Section B3. The grantee shall  select  the
               19   chief executive officer, that is the coordinator, on
               20   the basis of regional advisory group nomination.
               21              So even though the chief executive officer,  the
               22   coordinator or director of the RMP, is the employee-of  the
               23   grantee organization, he can only be selected, he or she.
               24   can only be selected by the grantee on the basis of
  Ace -Federal Reporters,  Inc. nomination by the regional advisory group.
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                                                                                 10 8



     dw 7         1              DR. OCHSNER:  Is that the way it is now?
                  2              DR. MARGULIES:  It is and it isn't.
                  3              DR. PAHL:  Nothing is uniform across 56 regional
                  4  medical programs.
                  5              Any statement we write here is going to have
                  6  three unhappy medical programs.
                  7              It is impossible to develop understandings after
                  8  a program has been in  operation  five  years  and  not  affect
                  9  somebody adversely.
                10               It doesn't matter what words are written, there
                11   can't be happiness throughout 56 or 57 RMPS.
                12               MRS. WYCKOFF:  It isn't retroactive, is it?

                                 DR. PAHL:  No.  And there will be implementation
                1 3
                14   in a logical and phased way.
                15               8ut what it is saying is that this is what we
                16   perceive to be the proper role and relation hip of the
                17   coordinator to the grantee.
                18               DR. MARGULIES:  I  think  in  further  response  to
                19   your question, in practice, certainly in the last two years,
                20   the grantee has  not  selected  a  coordinator  without  fairly
                     heavy involvement with the regional advisory group.
                2 1
                22               That part, I don't think, is going to cause any
                23   particular  difficulty.
                24               I think the last point  will  come  to  haunt  this

  Ace-Federal  Reporters,  Inc
                     council.  It should be made clear here.
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                                                                            109
    dw 8


                 1            In all honesty, I think we better face up  to  it

                 2 now.

                 3            I would like to call to your attention Section

                 4 B2.

                 5            This has to do with the election of the  chairman

                 6 of the regional advisory group and if there is to be trouble

                 7 in any of the regional medical programs as a result of  this

                 8 document, we believe it will be as a result of this particular

                 9 section.

               10             What this says is that the grantee  will  confirm

               11  -- and says subsequent selection of RAG chairman and the word

               12  "subsequent" refers to the fact when an RMP is  first  being

               13  established, then the applicant,who is usually the  grantee,

               14  has to select the usual chairman.

               15             After the RAG bylaws are developed  and  approved

               16  by RMPS, up until now it has been the  practice  I  believe,

               17  of the majority of the regional medical programs to have the

               18  selection made by the regional advisory group without any

               19  need for confirmation by the grantee.

               20             It is our position, the few of us who  have  been

               21  instrumental in developing this statement, it is our position

               22  that the appropriate relationship, not what exists, but  the

               23  appropriate relationship, and one which must exist for a

               24  truly effective and viable RMP, is one in which the regional
  Ace -Federal Reporters,  Inc.
               25  advisory group chairman is confirmed by the grantee.

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                                                                                  110


     dw 9         1              We believe, as we  conceptualize  it,  that  in  the
                  2 region there is a grantee organization, a coordinator, and a

                  3  regional advisory group.
                  4              Unless the relationships of  all  three  are  good  work-
                  5  ing relationships, then, in fact, there is a serious problem
                  6  and over the last year and a  quarter  a  number  of  these  problems
                  7  have come to your attention and to Dr. Margulies' continuing
                  8  attention necessitating  sometimes  changes  of  grantee,  but
                  9  more often than not, changes of coordinator or RAG chairman.
                10               What this document proposes to  do  is  say  what  should
                11   be a functioning relationship in a triangular relation.
                12               This means the coordinator  is  nominated  by  RAG
                13   but selected by the grantee, since it is the grantee's
                14   employee.
                15               The RAG chairman is again selected by the
                1 6 regional@. advisory group, but confirmed by --  conf  irmed  by
                17   the grantee organization, which  means  that  at  least  there
                     is an acceptable individual  in  a  position  of  importance  on
                18
                19   the RAG, acceptable to the grantee.
                                 We feel this is imporant  and  if  this  document,  which
                20
                21   has not been submitted  to  the  regional  medical  programs  as
                22   policy, if this does have your endorsement,  therel,.@will  be
                23   a few regional medical programs that will find it very
                24   uncomforatble.
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    dw 10


                 I            If we don't have this, the regional medical programE

                 2 will find it more satisfying and comfortable as a

                 3 document but it won't lead to an improvement in the relation-

                 4 ships which do exist.

                 5            We will continue to have, in our opinion, in my

                 6 opinion, the same kinds of problems which have been coming

                 7 to this council as a result of difficulties in this

                 8 triangular arrangement we have, which we call a regional

                 9 medical program.

               10             With that, Dr. Cannon, if everyone is comfortable

               11  with it, and we hope they would be, we can have this

               12  endorsed.

               13             We are trying to say to you there has been some

               14  problem from some RMPS, particularly with regard to this

               15  point.

               16             DR. CANNON:  I think there would be less problems

               17  than we had in the past.

               18             DR. MARGULIES:  Having a set of rules is more

               19  important than full pleasure in them.

               20             I don't see any great problems in what we have

               21  said.

               22             DR. CANNON:  I move that we accept this.

               2 3            MR. MILLIKEN:  Second.
               24                                        motion and second

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        dw 11
                               All in favor say aye.

                2              (Chorus of ayes.)
                3              DR. MARGULIES:  Opposed?
                4              (No answer.)
                5              DR. PAHL:  In recognition we are fast approaching
                6   lunch hour, let me say a few items are for your information
                7   only.
                8              I don't think they require any particular
                9   discussion except that you may well be interested in the
               10   regional evaluation survey which was completed a while back
               11   and has to do with the present state of evaluation and of
               12   resources and activities in the regions, together, with a
               13   document which points out how we plan to use our evaluation
               14   funds in fiscal '73 in very specific ways As well as a
               15   listing of contracts which are funded by us both in the kidney
               16   program and otherwise.
               17              These documents -- we will be pleased to  answer
               18   questions should you have one.
                               There is one last point of business which I think
               19
                    is important and that has to do with the kidney  guidelines
               20
               21   and I would ask Dr. Hinman to please present this point  of
   Ond 11      22   business.

               23


               24

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    CR6499                                                                 113

    #12-ter-1
                1             DR. MARGULIES:  We will ask Dr. Hinman to go over
                2  these kidney guidelines.  We will adjourn for lunch.  After
                3  lunch, we will proceed to some updating on the Cancer Construc-
                4  tion Facility, and move from there to a review of the block
                5  actions on the supplementary awards for emergency medical  sys-
                6  tems, health maintenance systems, and for the education  acti-

                7  vities.
                8             So you can sort of set your timing accordingly.
                9             DR. HINMAN:  Thank you.
              10              on may 3rd, this document was mailed to all of  you,
              11   the coordinators of the Review Committee. it  incorporated  the
              12   discussions which had been held with this discussion over  the
              13   past two meetings, and discussions in the field over the  last
              14   eight to ten months.
              15              The prime,emphasis had been to try to begin to  move
              16   the kidney supported activities-into the regional medical
              17   program activities at a local level, and yet still maintain  a
              18   certain amount of program direction so there would not be over"
              19   lapping and under-utilization of expensive facilities.
              20              The emphasis here is upon the development of a
              21   regional plan for the treatment of resources for @stageol
              22   kidney patients, which must@be approved by the RAG.  And,  then
              23   applications from individual RMPs,or investigators must meet
              24   this regional plan. We have emphasized there would be  a  local
  \ce - Fedeial Repofters,  Inc. technical review that would be performed by three experts in th@
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                                                                            114



                1  field who do not reside or work within theregion, submitting the

                2 application, and that they must be approved either  from  our

                3 list of consultants maintained here, or a  curriculum  vitae,

                4 sent to us for approval by the RMP; the written  comments  of

                5 these reviewers would be presented to the  regional  advisory

                6 group who would disapprove or approve the project  and  sent

                7 it into headquarters.

                8            There would not be an additional review at the

                9 Washington'level.  It would be presented to the Review Committe4-,

              10  for priorities concerning funding.
              11             This was discussed after the last Review Committee

              12  Session.  There was a question on one part of it which I

                    'll bring up in a moment.  I am wondering if you all have any
              13  wl
              14  questions concerning any element in the document so far?
              15             DR. MARGULIES: For the benefit of  those  who  are

                  now on the Council, let me say very quickly, that the dialysis
              1 6
              17  and transplant program for kidney disease in RMPL  has  been
              18  operated on a different basis from the other activities.
              19             Our intent, over the long period of time,  is  to
              20  establish on a kind of national network basis, a  method  of
              21  investing RMP funds that will lead to an orderly development of
              22  centers for dialysis and transplant, so that we do not scatter
              23  activities according to individual perceptions, but rather@move
                  toward location and development of competent centers, located
              24
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    ter-3                                                                  115


                1  period of time, we get as close as possible to total access to
                2@ a very predictable number of individuals who will require
                3  dialysis and transplant.
                4            As a consequence, we need a separate set of guide-
                5  lines which has been up for discussion from time to time.  This
                6  is the final phase of that discussion.  These were distributed.
                7  We have had no negative comment that I know of from the regional
                8  medical program, and there was, as will be indicated in a
                9  moment, some question raised by the Review Committee.
                             DR. DE BAKEY:  One question I wnated to raise about
              11   it.  I think it has confusion.  In paragraph Six (b), it says,
                                                              ansplantatioh surger,F."
              12   "Assure maximum utilization of full-time tr
              13   I think there is some confusion about what they mean by full"

              14   time.
              15             DR. HINMAN:  The intent was that this would@,@,@not@be
              16   a general surgeon doing it as a ten percent activity, but an
              17   actual surgeon devoting the full per  at.@
              18   P  tati  p@       A   -- k duey t        t
              19              DR. DE BAKEY:  it has been interpreted,differently
              20   in different places.  In our region, it has been interpreted
              21   two ways;  P @ll@                    f@                   and
              22          so                       41   @@do        elm    That,
              23   to me, you know, important to clarify because it has created
              24   a lot of difficulty within our own program for this reason.

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                                                                                  116
     ter-4


                 I this will do when you get  out  in  the  periphery  of  where  they
                 2  can be interpreted differently and sometimes, they are inter-
                 3  preted differently because the people who are involved in the
                 4  interpretations want to interpret them their way, you see?

                 5              DR. MARGULIES: This also  --  you  picked  up  a  very

                 6  critical point.

                 7              DA. DE BAKEY:  I am always doing that.

                 8              (Laughter.)

                 9              DR. MARGULIES:  It was very extensively deliberated

               10   because the question was  centered  around  whether  you  can  get
               11   an effective transplant  activity  going  without  a  true  basis
               12   of commitment for the surgeon and the surgical te         involved
               13   and in some of the proposals we had, the  attitude  was,  -'lw4bil
               14   of course, you know some one can come along and do it,"@.*b

               15   find@ ig          isfactory.
               16               We are trying to make a clear-cut commi          @and

               17   support to  that commitment.
               18               DR. DE BAKEY:  I think that is desirable.  I agree

               19   with you completely that there be in a sense a c
               20       p       .4 But, this can be done  in  a  number  of  different
               21   ways and different places.  I am not at all sure -- I had been
                    entirely happy myself with a patient  --  as  a  patient  with  a
               22
               23   man who is a full-time transplant surgeon@.
               24               DR. HINMM:  Dr. De Bakey, a question was raised as

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    ter-5                                                                  117



                1  this represented full-time.  We interpreted thi@s@rept    t

                2 full-time.

                3            DR. DE BAKEY: Yes. But you see,  it  is  being  inter-

                4 preted differently.  Thatis what I am saying.  For example,

                5 we have in our own group, all of us are full-time, you know.
                6 We are regarded as full-time.  That@dots noted"

                                  r                        We have h   a team     t
                7    g@fu I  t   'O  cutett ge f 11 time-!

                8 is well intogr'ted,.

                9            DR. MARGULIES:  I think we can do better with it
              10  by referring it more to a full commitment, rather than full-

              11  time, which is really what we are after.
              12             MRS. MARS:  Could one say, fully-qualified?
              13             DR. DE BAKEY:  No.  I think the intent is hot the
              14  qualification because you can get that  established.  The  intent
              15  is -- important, but it is not being interpreted that way.  It
              16  is desirable to make this intent a commitment.
                             DR. HINMAN: Absolutely.  We  have,ow  region,that  has
              17
              18  a number of places calling themselves transplant centers in
                  which the transplant is less tharr ten a year.  We do not feel
              19
              20  this is adequate to warrant our RMP support.
                             DR. DE BAKEY:  I think it is imp  ta t@t
              21
                        p nit    f@t e program@  The need is greater than,,is
              22
              23  being met so to speak.
                             DR. MARGULIES: I think we can  send  out,a  clarifying
              24

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              25  statement without changing the document which has already been

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                                                                                    118




                    circulated.

                                I can do that and make the point that what we are

                  3 after is some method of assuring there will be som,@         @:t

                  4 W,  @@w 11 4     il"     tigw. to it,, to develop the @ t6aiR,  the

                  5 confidence,  without  depending  upon  the  appearance  of   enough

                  6 patients to make  it  possible  which  is  another  kind  of  approach.

                  7 We can follow that.

                  8             MRS.  WYCKOFF:  Is  Section  910  something  we  are  using

                  9 for any of these, yet?

                10              DR. MARGULIES:  We will be, yes.  And we wi           e

                11  using 910 in this review cycle.

                12              DR. HINMAN:  If  there  are  no  other  questions,  I  will

                13  share with  you  the  concern  of  the  Review  Committee.  During  the

                14  discussions at the last Review Committee Meeting, the question

                15  was raised concerning our statement on page three, Item Two,

                16  the Second Paragraph  in  which  we  stated  that  should  the  RMP

                17  desire to choose  its  own  Review  Panel,  the  names  and  curriculum

                18  vita must be clear to the Divi!ion.of Professional and Technical

                19  Development.
                20              After considerable discussion, they made a motion
                21  that recommended to you all, that the wording be changed, and
                22  require that  the  local  RMP  only  utilize  consultants  whose  names
                23  are furnished  by  us,  without  them  having  an  opportunity  for

                24  input.

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    ter-7                                                                   119


                1 only been out for one month and we have not had an opportunity
                2@ to see if any problems will arise from this.  So far,
                3 any of the RMPs that have been reviewing kidney proposals have

                4 called and asked for suggestions of names; we have  given  them

                5 at least one or two more than they have wanted, and  they  have

                6 been very comfortable with this arrangement.

                7             DR. MARGULIES:  The Review Committee felt very strqnc-

                8 ly about this.  Their argument was if you are-g6ing,,to,use

                9 outside consultants, and try to obtain objectivity, you have

              10  a much higher level of security by doing it by a national panel
              11  with the assignment or at least,'the request for  professional,

              12  assignment coming from RMPs rather than from a panel

              13  from which the RMPs made their selections; and felt  there  was

              14  in the later sources, the source of some bias.

              15              I do not think it would do any harm -- Len, do  you

              16  have any further comment you would like to make?
              17              DR. SCHERLIS: I think what you have  stated  fairly
              18  reflects the review. We felt there is no reason  for  having  a
              19  kidney project than there is to allow a,r6gion to select its

              20  on-site visitors.
              21              I think you should have some national standards and
   0          22  the best way to have them is by having a national panel and
              23  that automatically, when they stated that they had a real
              24  project, this should be looked at by a national panel.

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              25              I do not believe in having a panel selecting  those

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    ter-8                                                                     120



                 1  groups they wish to select.

                 2             DR. MARGULIES: That was really  the  axis  on  which

                 3 the argument went on, George?","
                 4             DR. SCHREINER: I think you  should  give  them  that

                 5 flexibility.  There are two problems with having a closed

                 6 national panel.  one is that it is true that it does guarantee
                 7 a certain amount of standard quality, but it also is true that

                                                                       ac    1
                 8 generally speaking,, people who go in such panels,@     tiv'ties

                 9 are -- have other attributes besides their competence.
               @io             one is they have the time available, and two, is,thal.
               11  they are often selected on the basis of a certain kind of
               12  breadth that you might not find  in  all  technical  consultants.
               @13 Whereas when you are putting together  a  program  from  scratch,
               14  you might want a technical competence that you are not     going
               15  to find in the older, more established panelists, who   are   on

               16  the registry.
               17              it seems to me that the RMP can utilze that.  If
               18  they are going to have three regional  renal  authorities  --  if
               19  the trouble is with the AV fistulas,  that  are  breaking  down,
               20  you might not want a renal guy.  You might want a very good
               21  peripheral vascular surgeon. As long  as  they  are  subejct  to
                   some kind of a veto power, it seems to me that the document as
               22
               23  it exists, gives this added flexibility.
                               I also think it would be bad  to  change  things.  We
               24
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    ter-9                                                                  121



                1            DR. MC PHEDRAN:  Could you have the best of both

                2 worlds by adding a member that would be on everyone of the

                3 site-visit items?

                4            Have a national group always represented in the site-

                5 visit team, plus special technical.advice which was  suggested

                6 by the particular program that was being sight-visited?

                7            DR. SCHREINER:  These really are not site-vi@its.

                8 These are site-visits. (indicating.)

                9            DR. MC PHEDRAN:  I am sorry.

              10             DR. SCHREINER:  The region is putting together a

              11  program and obviously, it is to its best interests to get  the

              12  most expert people.

              13             DR. MARGULIES:  It is partly that, but it is also

              14  partly to see what they have put together.
              15             DR. SCHERLIS:  It is my interpretation the work will
              16  be done by the individuals selected. From there, as  I  listen
              17  to what you said, as I recall our discussion, the rest of  the
              18  Review Committee would not be related to the technical aspect.

              19  This is not just relative.
              20             It is when it comes in, it would have the stamp  of
              21  approval on it, saying the technical review is excellent,  but
              22  the people who did the technical review will have been selected
              23  by that group of individuals putting together their own program
              24  This is a technical review.
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                                                                                                                                                     122
         ter-10

                                I    visitors  will  look  at  who  did  the  technical  review.
                                2                          DR.  MARGULIES:    I  think  --  the  thing  is  that it  is@
                                3     a  question  of  degree.    We  would  restrict  them  to  a  group  of
                                4     consultants  whom we  have  selected  for  that  purpose.    The  real
                                5     discussion  is  whether  it  is  adequate  to  have  them  select  from
                                6     that  restricted  group,  or  whether  we  should  assign  from  that

                                7     restricted  group.
                                8                          The  paper  which  has  gone  out  already,  has  made  that
                                9     that  they  could  select  from  that  group.
                             10                            MRS.  MORGAN:    This  is  a  group  you  have  selected  priO3'

                             11       to  this.
                             12                            DR.  MARGULIES:    Yes.    That  we  have  selected  or  that
                             13       have  been         suggested  to  us.    We  have  agreed  they  should  be  a
                             14       part  thereof.
                                                           Now,  if  you  wish  to  change  it  in deference  to  the
                             15
                                      Review  Committee's  6bjectivities,  we  can  do  that.    Or  we  can
                             1611  ave
                             17@   e           it  as  it  stands,  and  see  how  it  functions,  and  review  it
                             18       in  the  future  to  see  if  it  needs  to  be  altered.    Either  way.
                             19                            DR.  DE  BAKEY:    In  the  document  here,  you  make  it
                             20       quite  specific  that  the  RMP's  Review  Committee  will  not  review
                             21       on  a  technical  basis,  the  merit.
                             22                            DR.  MARGULIES:    That  is  right.    it  is  to  be  done
                             23       by  the  consultants.
                             24                            DR.  DE  BAKEY:    So  in  a  sense,  you  are  putting  the
    \ce- Federal Reporters,  Inc.     responsibility  for  the  technical  aspects  on  the  consultants?
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    ter-11                                                                  123



                1             DR. MARGULIES:  Yes.
                2@            DR. HINMAN:  We do not do technical review of the
                3 RMP applications on a project by project basis anymore, except

                4 in the EMS round.

                5             (Laughter.)

                6             DR. MARGULIES:  This is the one in which we wish

                7 explicitly  build in technical review.

                8             DR. DE BAKEY:  Wait a minute, you do on your project

                9 visits.  You have technical review on project site visits.

              10  I think there is a lot to be said for keeping it the way it is.

              11  I would be inclined to leave it the way it is in spite of

              12  the strong feeling of the Review Committee.
              13              I think there are some good reasons for leaving it

              14  this way.

              15              DR. MARGULIES:  Any further discussion?

              16              DR. DE BAKEY:  Second

              17  such a big  point made@by the Review CoMitte
              18              DR. MARGULIES:  Well, like with any other discussion
              19  you sort of have to be there to get the feeling of it.
              20              Would anyone like to make a motion on this?
              21              Want to ponder it further?
                                    HREINER:  You want a motion for ap roval o@
              22                                                      p
              2@           elines?  I would so move.
              24              MRS. MORGAN:  Second it.

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                              DR. DE BAKEY:  With clarification of the full-time
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                                                                            12 4
    ter-12



                I  time business.

                2             DR. SCHREINER:  Right.

                3             DR. MARGULIES:  moved and seconded, the guidelines
                4 be approved as they have been distributed with a letter of

                5  the clarification of the meaning of full-time surgeon.

                6             All in favor, say "Aye."

                7             (Chorus of Ayes.)

                8             DR. MARGULIES:  Opposed.

                9             (No answer.)

               10             DR. MARGULIES:  We will reconvene at 1:16.
               11             (Whereupon, at 12:35 p.m., the hearing was recessed,

      d #12    12  to reconvene at 1:16 p.m., this same day.)

               13


               14


               15


               16


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               18


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               20


               21


               22


               23


               24

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     me a- 1
     CR 6499                                                                125
     #13
                1                        AFTERNOON SESSION
                2@                                                   (1:35 pm.)
                3             DR. PIARGULIES:  You will recall that part of the
                4  unfinished business of the last meeting had to do with the
                5  action of the Council regarding the application for a
                6  construction grant for a cancer center in Seattle.
                7             There was a motion by the Council which was passed tc
                8  provide the grant award if certain conditions were met.  As you
                9  know, this was a specific action which had been made by the
               10  Appropriations Committee in the preceding fiscal year,
               11  identifying $5 million for this purpose.
               12             There were very careful reviews of the applications
               13  including the primary one which came from Seattle.  There has
               14  been a series of events following that which Mt. Russell, who
               15  is the head of the western group of programs will summarize
               1 6 for you.
               17             We have not awarded the grant and if it is to be
               18  awarded it must be awarded within this fiscal year because we
               19  had to make sure that all of the requirements were met and give
               20  the Council the opportunity to see whether or not they would
               2 1 accept the application in the modified form.
               22             So, if you will bring us up to date?
               23             I should add that the amount of work which has gone
               24  into this on the part of the staff has been extraordinary and
  @ce -Federal Reporters,  Inc. it's been very carefully correlated.
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     mea-2
                                                                              126


                 1            We won't detail all of that.  You can assume that's
                 2 been the case and Dick will take over from there.
                 3            MR. RUSSELL:  As most of you will remember, the
                   award was contingent upon the applicant's meeting  a  number  of
                 4
                 5 specific conditions.  There were four major conditions.
                 6            The first one was that all  relevant  federal,  state
                   and local requirements concerning expenditure of federal funds
                 7
                 8 for the construction of the proposed type of  facility  -"  this
                 9 includes all needed licenses, permits, approval, et  cetera  --  be

               1 0 me t
               11             The applicant has satisfied this condition.
               12             The second condition was that the University of
               13  Washington and Swedish Hospital  formalize  their  relationships
               14  with the Fred Hutchinson Cancer Research Center through written
               15  agreements.
               16             There now exist formal affiliation agreements
               17  between the Fred Hutchinson Cancer  Research  Center,  Incorporated
                   and the Board of Trustees of the University  of  Washington  and
               18
               19  between the Center and the Swedish Hospital Medical Center.
               20             The third condition was that all conditions  @
               21  contained in the Councills November 10, 1971 statement  on
               22  cancer center to serve HEW 10 are satisfied.
                              In February, you remember Council  received  the  report
               23
               24  of the January site visit to the Fred  Hutchinson  Cancer  Research
  kce - Fedefat Repofters,  Inc. Center and found that most of the conditions set  forth  in  the
               25





     me a-@ 3                                                              12 7


                1 November statement of Council had been satisfied.
                2            Those conditions which were not satisfied at  that
                3 time were covered by the conditions placed on the awards.-
                4            The fourth condition was that the provision of  space
                5 to accommodate 20 beds which would be isolated from the  Swedish
                6 Hospital Medical Center be reconsidered with further  justifica-
                7 tion for review and approval by the National Advisory Council,
                8 RMPS.
                9            This condition stemmed from Council's concern that
              10  research patients in isolated units often receive  inadequate
              11  general care.  The placement of the beds in the Fred
                  Hutchinson Cancer Research Center it seemed would separate tt,-
              1 2
                  research patients from the general medical services that they
              13
              14  would require.
                             Further it appeared that adequate emergency  services
              15
              16  might not be available to the research unit since there was
              17  no indication that the professional attention and  facilities
              18  required for emergencies would be available immediately.
              19             Now, you have before you the applicant's  response
              20  to Council's concerns. This is the letter dated  April  22nd,
              21  signed by Dr. Hutchinson, President and Director of the  Fred
              22  Hutchinson Cancer Pesearch Center, Dr. Lobe, Medical Director,
              23  Swedish Hospital Medical Center and Dr. Donald Thomas, Head of
              24  Medical Encology at the University of WAshington.
  @ce- Federal Reporters,  Inc. This states the consideration of the bed has  been
              25




     Tnea.-4
                                                                            12 8


                   reconsidered and the plan to Place the beds in the  tenter  was
                   reaffirmed,the primary reason being if the beds were not placed
                2
                3  in the center, the regional concept in the Northwest area would
                4  be seriously jeopardized.
                5             What the letter does not say, but is a fact, is that
                6  if the beds were placed in any other facility except the center,
                7  one of the major institutions in Seattle which is heavily
                8  involved in cancer programming will not participate in t e
                9  center.
               10             Therefore, the entire regi.onalization concept  will
               11  go down the drain.
               12             The letter as you know states that the  center  will
                   have complete medical staff ranging from house officers to
               13
               14  fellows to a senior staff of 24-hout coverage seven days a week
                              The beds in the "enter will not interfere  with  the
               15
               16  excellence of treatment and care given to the patients.  Since
               17  the Center will be connected to Swedish Hospital by a short
               18  tunnel and elevator, the patients will be in immediate
               19  proximity to all hospital services.
               20             The applicant believes that any  emergency  measures
               21  could be promptly instituted and the treatment facilities
               22  available will be closer than in many large hospitals.
               23             In summary, then, the Fred Hutchinson Cancer Researc
               24  Center has responded to all of the conditions placed on the
  %ce - Fedeiai Reporters,  Inc. award. Through administrative and previous Council review, it
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          5                                                                129


                1 has been determined that to date all forms of these  conditions,
                2 the issue of the bed locations, have been satisfied.
                3            Since this requires Council consideration, this is
                4 what we are placing before you now.
                5            MRS. MARS:  First of all, I would like to make a
                / motion that the money be awarded with the condition that  the
                0
                7 fourth condition be taken out of the motion that was  previously
                8 made. I think that the -- it's very necessary that the  beds  be
                9 in the research center. I think we would be doing them a great
              10  deal of harm and defeat the purpose of the entire center, for
                  what it stands for, not only in regionalization, but it is going

                  to stop teaching; it is going to stop research.
              12
              13             It becomes part of Swedish Hospital; the  patients
              14  become under the supervision of Swedish Hospital and having  met
              15  the people involved, the caliber of the type of individuals
              16  involved in the Fred Hutchinson Center, I just cannot see that
              17  there would be any question whatsoever as to the treatment and
              18  the type of care that would be rend6red patients under  their

                  supervision.
              19
              20             So, therefore, I think that we are doing them a
              21  great injustice by insisting that these beds go into  Swedish
              22  Hospital.  I think the whole purpose would be detdated"
              23  entirely and, as I say, a great injustice create .
              24             I met these people; I talked to them.  I  think  this
  %ce- Federal Reporters,  Inc. letter explains - I tnink everything that is said in this I.ettex
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     mea-6                                                                    130


                1  would be carried out and they could be completely trusted.
                2@            DR. MARGULIES: There is a  motion  to  approve  the
                3  grant award And accept the placement of the hospital beds as

                4  proposed by the applicant.  Is there a second?

                5             DR. DE BAKEY:  I second.

                6             DR. MARGULIES:  Be moved and seconded.  Further

                7  discussion?

                8             DR. OCHSNER:  I presume -- they say the Swedish

                9  Hospital will supply recovery room.  Will that mean that the

               10  patient will remain in the recovery room in the Swedish

               11  Hospital?

               12             MR. RUSSELL:  I do not know, sir.

               13             DR. OCHSNER: The supplying  of  the  recovery  room

               14  doesn't mean anything unless the patient remains there.
               15             MRS. MARS:  I tnink this is a fact.  This would be

               16  carried forward.
               17             DR. DE BAKEY: I don't see  how  they  can  possibly
               18  duplicate in the center a recovery room and intensive care unit
               19             MRS. MARS:  I don't think there is any attempt made

               20  to do so.
               21             MR. RUSSELL:  Dr. Ochsner, I believe Mrs. Mars'
               22  observation is correct.  Having looked at the schematic plans
               23  and not being an engineer, I can't say for sure, but I don't

               24  see plans for a patient recovery room.
  %ce -Federal Reporters, Inc. DR. OCHSNER:  I wondered whether they  were  going
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       mea--7                                                                      131


                  1  to leave the patient there because they were so adamant about
                  2@ not leaving the patient there.
                  3              DR. SCHREINER:  On this scheme where are the

                  4  elevators?
                  5              MRS. MARS:  There's a tunnel, you see, which goes
                     underneath  and this tunnel is very short.  Actually, we walke
                  0
                  7  the ground, distance above and it's not very far.

                  8              DR. OCHSNER:  Ninety feet.
                  9              DR. SCHREINER:  I presume the building is somewhere

                io   inside.
                11               MRS. MARS:  I dan't remember where the elevators

                12   would be.
                13               DR. SCHREINER:  It would make a difference if the
                14   elevator were at the other end of the building.  Not that I
                15   would predict that hospital architects could be that stupid,
                16   except I haven't worked in one vet in which they haven't been.
                                 MRSI MARS:  I presume there will be some such errors
                17@
                     made.
                18
                19               DR. MARGULIES:  They have had extensive architectural
                20   consultation.  They have not had legal consultation to t e
                21   extent you heard this morning, George.
   0            22               Any further discussion?
                23               DR. DE BAKEY:  I-low many beds in the center?
                24               MRS. MARS:  Twenty.  And there is space, adequate
  @ce- Federal Reporters,  Inc. space to increase that number at some tutu-re date.
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     mea-8                                                                  132


                1             The one thing that we fought them particularly on
                2  was the fact that so much space was relegated to parking areas.
                3  This in the end obviously was not necessary and that space
                   can be utilized and at some point can be utilized for more
                4
                5  beds if necessary as well as laboratories.
                6             So that all this, every inch of ground will be
                7  utilized for the research center. As I said before, the
                8  caliber of people involved, there's just no question in my mind
                9  that care, proper care would not be instituted and carried out

                   to the nth degree.
               I 0
                              DR. DE BAKEY:  To what extent will the University

               12  of Washington participate?
                              MRS. MARS:  They will participate as far as
               1 3
               14  teaching and their students coming over, supportive faculty.
               15  I believe part of their faculty will be involved in it.  They
               16  would use it for their own teaching purpose.
               17             DR. 14ARGULIES:  I think all of the affiliation
                   agreements, they are not only signed but I think there has been
               18
               19  a real effort to work out the usual kinds of sticky details
                   when you have research grants in one activity going on in
               20
               2 1 another.
   0           22             I think they are probably as f ar along as one can
               23  get before the building is completed.
               24             DR. SCHREINER:  I can see where we are under a lot
  @kce -Federal Reporters, Inc. of pressure here. I don't think we should gloss over it, no
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     mea-9                                                                  133


                1 matter how competent anybody is in the cancer field.  That is
                2 @a long way from a complete medical staff.  I   I
                3             It's fine if you are not dealing with very sick
                4 patients, but if you need a pulmonary machine in a hurry and
                5 there are a couple of them across the street, it's going to pose
                6 real problems in the thought that you could have a totally
                7 competent emergency service serving 20 patients.
                8             It means one of two things:  Either they are not
                9 going to be complete or its going to be very expensive.  You
               10 can't get around the logistics.  You can't provide a complete

               11 medical staff for 20 people.
               12             MRS. MARS:  No.  But the facilities are completely
               13 available within 90 feet so to speak.
               I              DR. MARGULIES: If there is no further discussion, t
               I  motion is to approve the grant award with the conditions which
               I  you have established and which have been met, dropping out the
               I  requirement that the beds be moved out of the center.

               I              All those in f avor say aye.

               19             (Chorus of ayes.)
               20             DR. MARGULIES:  Opposed?
               21             (No answer.)
      CR 6499
      End #13  22             DR. MARGULIES:  Thank you, Dick.

               23


               24

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             CR-6499                                       We will now move  to the  consideration of the  special
                 @14
               nl-)-l                  actions which are going to be presented as bloc  actions,  one
                              2
                              3        on emergency medical  services,  the other on health maintenance
                              4        actions.
                              5                            Len,  do you want to come up to the  front?
                              6                            By way of introduction,  these  are carried out as
                              7        supplementary reviews because we were,  at the time of  setting
                              8        uT) the review processes,,  unsure of the total amount of funds
                              9        which  would  be  available  to  us  in  June.    This  is  June  and we
                             10        remain  unsure  of  the  total  funds  which  will  be  available  to
                             11        US.    At  least  that  part  of  it  was  correct.    What  we  therefore
                             12        decided  to  do  was  to  provide  regions  the  opportunity  to  res-
                             13        pond  to  a  special  supplementary  award  concept.
                             14                             We  had  in  the  course  of  doing  it  to  set  up  some
                                       very  specialized  procedures.    obviously,  the  best  thing  to  do
                             15
                             16        would  be  to  combine  review  committee  and  council  membership
                                       to  carry  out  these  review  processes  and  that we  have  done.
                             17  ,
                             18                             With  the  emergency  medical  s@stems,,  vie  aslzed
                             19        Dr.  Scherlis  to  act  as  chairman  of  a  group  which  included
                             20        Dr.  Bessen  and  T,,Ir.  Toomey  and  Drs.  Roth  and  McPliedran  from
                                       the  council.    They  did  participate  in  that  review.    We  also
                             21
                             22        had  some  consultants  in  emergency  medical  systems  to  come
                             23        in;  Dimmicl,,  from Alabama,  Kenrick  from  Ohio.
                             24                              The  @UI)COmmittee  activity  was  headed  by  Dr.  Rose
    \ce -Federal Reporters,  Inc.      whom  you  met  earlier.
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                                                                                135


       nb-2                     -he only other thing I want to say before Dr. Scl-ierl,s
                2   makes the presentation is that there are two activities in
                3   the emergency medical field which are undertaken at the present
                    time.  one of them is a contract activity which is managed
                4
                5   out of the office of  the  administrator  and  which  provides  with
                6   a total of $8 million for five derqc:nstration  contracts  to  be
                7   carred out by those applicants  who  within  the  contract  award
                8   in a national competition.  That  competition  is  under  way  at
                9   the present time.
                10              The contracts submitted,  the  responses  to  proposal
                    have all been  in.  They  have  been  through  review.  site  visits
                12  have been conducted. We do not  at  this  time  know  which  of  the
                13  applicants will receive the contract.
                14              Tjov7, because these contract requests came in at
                15  the same time as our emergency  activities  and  this  was  delib-
                16  erately planned, we have set up a  mechanism  for  keeping  a  day
                17  by day information flow  between  the  contract  activity  and  RMPs
                1 81activity so there is no possibility  that  we  would  be  awarding
                19  to PIIP funds which are also being awarded through contract.
                    There won't be any duplication.
                20
                                Back of this effort lies the desire which I feel
                21
                22  rather strongly about to make  sure  that  anything  which  is  done
                23  in the emergency field  through  major  demonstrations  does  not
                24  simply remain five interesting demonstrations  as  is  so  6  ten
  Ace-Federal Reporters, Inc. the case.
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                                                                               13 6



       nb-3                     We hope that we can follow the  earlier  thrust  of
                 2       towards emergency medical  services  by  setting  the  stage
                    for a much better integration  of  emergency  medical  care  than
                 3
                 4  has been present in the past and by establishing an environment
                 5  by anvthing which comes out of the major contract demonstration
                    will have meaning for  fuller  utilization  across  the  country.
                 6
                 7              We have generally followed  the  same  principles  as
                 8  the contract has followed in its review processes.
                 9              Len, if you would like to  introduce  what  you  have
               1 0  done.
               11               DR. SCIIERTIS: First I want to thank  you  for  the
                    opportunity of presenting the  findings  of  our  subcommittee,
               12
               13   I narticularly  want to thank Dr. Roth who was liere,because
                    I had been impressed until I read  the  review  in  the  American
               14
               15   Medical Association Bulletin.
                                The committee was faced with what to  me  is  one  of
               1 6
               17   most formidable tasks that a review committee can have and it
                    would have been impossible without the help of staff.
               18
                                I,viill allude to that in a moment,  We had some 35
               1 9
               20   projects submitted from the various regions and some of these
               21   projects really existed have not  just  one  but  six  individual
               22   projects.  This itself said something to us as far as the
                    review was concerned. Each  region  had  received  some  very  we
               23
               24   detailed guidelines as far as what was hoped there actual
  Ace - Federal Reporters,  Inc. application would include and it is  interesting  to  note  t  at
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                                                                                               13 7



            nl-)-4   I   some of them went right down the line and almost rephrased
                     2   the grants, exactly what the application@planning had indicated.

                     3   Others indicating a high degree of independence paid no

                     4   attention to what the guidelines were.   Some were inbetween.

                     5   Some of the applications really addressed themselves to the

                     6   total slystem of care which is what the committee was basically

                     7   interested in.   Unlike the contract funds which in some

                     8   instances look at specific aspects of emergency care, the

                     9   applications we were most interested in really related to a

                  io     total system which involves not an excellent project on

                  11     trauma or one on coronary disease  but one which nut all of

                  12     these together.

                  13                  This had to be part of our consideration because

                  14     they are talking about a total system.   one couldn't begin

                  15     at this stage to front 'part of the system which was so highly
                  16     categorical that it could not come to terms with what could
                  17     be a total system of care.   At the same time there had to be
                  18     some realistic limitations in our consideration, not just
                  19     because of the function constraint, which we don't know about
                         because we are operating in a vacuum here as far as knowing
                  20
                  21     what funds are available, but because of the constraint too
                  22     that any system being proposed now might begin with a small
                  23     bite of what can be alone but yet it had to pay attention to the
                  24     fact that whatever bite was now supported would be part of an
  4ce -Federal RePorters, Inc, overall T31anni.ng process.
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                                                                                                                        13 8



            nl-)-5                               The  staff work that I have  alluded to briefly,  was

                               an excellent one because what had been done was  to go through

                               all of these T)rojects  in some detail looking  for actual page
                         3
                         4     references  in terms of the guidelines  set out.   The reviewers
                               had six or seven programs  for nrimary review and another six
                         5
                         6     or seven for secondary review.
                         7                       You ),:now the  thickness of these  grants,  particularly
                         8     when there was  a time  limitation on the  applicants, what was
                         9     done was  to give us three or four pages of material which were
                        10     relevant and then everything else which was of background
                        11     material.
                        12                       The background material,  as you know,  becomes more
                        13     and more extensive  as the program  becomes more  and more
                        14     limited.    I  for one ended up with many dry figures.   The volume
                        15     of the material was unbelievable.
                                                 The review meeting was  an all day affair.   We did
                        16
                        17     not adjourn for lunch,  we  did not adjourn for coffee,  just
                        18     to give you an idea of the problems we had.
                                                 lie  reviewed the  35  projects  in some detail trying
                        19
                        20     to,  as  I indicated,  trying to                look at a total system of care
                        21     to make sure that all of the  community components were
                        22     involved with plans,  looking  for demonstrations of needs.
                                                 It is  simple  to come up with a project that says
                        23
                               finance  50  ambulances each one of which is  a coronary care
                        24
   Ace-Federal Reporters,  Inc. vehicle  and to list all the hardware  for -- telemetry and to
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                                                                            13 9


                   go into a system of communication. But what we tried  to  find
      nb-6
                 2 out .,7as if this related to a system of care which got involved
                   with existing emergency  rooms,  hospital  facilities.  In  great
                 3
                 4 measure the work of the Interagency Society -- ICIID -- these
                   reT.)orts helped us particularly the one on the stratified system
                 5
                 6 of care.
                 7             A lot of the emergency care in the area of heart
                 8 disease relates to it. As I said  that  is  not  the  categorical
                 9 supT-)ort.
               10              The.,type of evaluation we had from the staff is
               11  a highly detailed report which we paid great attention to.  At
               12  least it gave us a sense of what was included and what the

                   ratinq   was.
               13
               14              Dr. Rose is to be congratulated for the work his
                   groun did on this.
               15
               16              In total we reviewed 35 projects.  The amount
                   requested came to a total of $14 million for  a  grand  total  of
               17
                   three years of $33 million.
               18
                               Five of them we gave  recommendation  of  disapproval
               19
                   to: the remaining 30, the first year where 14 million had been
               20
                   requested, we recommended a funding for the amount of $5,788,OOD.
               21
                   For the second year  302,000.
               22                      II/
                               Some of the recommendations are in  terms  of  taking
               23
                   what had been a large request, sometimes totally several
               24
  A,ce- Federal Reporters,  Inc. million dollars and grading it down to  what  we  requested  that
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                                                                                140


         nb-7    I  they v7ere funded for planning.   In some  instances  the  plans
                 2  were excellent.    In terms of  the  involvement  of  community
                 3  groups which would have to be Z part  of  the  program,  we  felt
                 4  this was a glaring enough  omission  that  we  would  recommend
                 5  no funding or minimal amount for planning.
                 6             There was a wide variation  as  far  as  the  content
                    of these proposals. In one  or  two  instances,  indeed  a  total
                 7           1
                 8  system of care was set up involving training of the necessary
                    medical and allied  health  groups,  transportation  which  was
                 9
                10  on a broad base not just dedicated vehicles, emergency medical
                    services, laN7 education, professional  education,  and  a  whole
                11
                12  gamut of care  involving  trauma,  heart  disease,  psychiatric
                13  care, and so on.
                14             The others which  were  packaged  for  hardware,  out
                15  of the blue, without there being any indication or support what-
                16  soever.  The levels of support vary markedly.  late graded them
                    as best we could, giving a  priority  grading,  five  being  the
                17
                181 highest.  In natural fact only, a few fours were presen
                    Some ,,ou will note were zeroes.  In some instances the appli-
                1 9
                    cations we received really weren't  sent  to  us.  I  say  that
                20
                    because it was apparent from dates and from letters of
                2 1
                22  approval that they had been prepared  in  the  past  for  other
                    sources of funding and because  some  were  duplicates  of  what
                23
                    had been sent for the contract funding and as such really
                24
  Ace-Federal Reporters, Inc. didn It address themselves to systems of care, only looked at
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                                                                              141



       nb-8      I  very small T)arts of the package.

                 I             The members of the committee here, Dr. Roth,
                 3  Dr. I,IcPl-iedran will vouch for the fact that if we had difficulties
                 4  it was in terms of wading through what looked like systems of
                 5  care until you got down to the fact that these had really a
                 6  lack of wide community support, a lack of evidence of accept-

                 7  ability in the total community.
                 8             Some states which submitted two or four or six
                 9  different applications v7eren't related.  Thus a variation
               10   as far as levels of support which were suggested.
               11              My own feeling is that emergency medical services
               12   is one of the very few opportunities which the regional medical
               13   program has of setting up cooperative ventures in systems of
                    care and actually addressing lu4P to the problem of strati-
               14
               15   fication of care, reference centers for types of care, and
               16   putting the various individuals involved with emergency care
               17   into committee or planning group, probably involving what I
                    think is a very important aspect of regional medical activity.
               18
               1 9             Than]-@ you.
    J".nd of #14 20            Dr. Roth,, Dr. PlcPhedran?

               21
   0           22

               23


               24

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                                                                               142


     CR 6499      1            DR. ROTH:  I think that he has given an excellent sum-
      # 15
     dh 1         2 mary of the dilemma or the problem  that  we  had  before  us.  It

                  3 was perfectly obvious as,I had occasion to say earlier this
                  4 morning,, that presented a problem that we have run into many timBs

                  5 in RMP:
                  6            If need qualifies  you,  certain  areas  automat  cally
                  7 get a top priority, and if resources  meet  those  needsv  You're  in
                  8 trouble.  So we did the very best we could.
                  9            I think the council should be aware that when you
                  10 look on this summary page, you almost  don't  have  to  look  over
                  11 the last two columns to  see  what  happened.  The  programs  that
                  12 got rated five and four made out reasonably well in the finan-
                  1 3cial dealings,, recommendations.  I @ . I  !
                  14           The people with the threes and the  two  and  a  half  and
                  15 so on# have made out less well,  But  this  is  merely  a  reflection
                  16 of the concensus of the re-sources those extremely poor in many
                    of these places where the need  is.so.tremendous  to  at  least  give
                  17
                  18 them money to go on with further planning and try to get a show
                  19 on the road.
                  20           It may be far more  important  than  just  its  reflection
                  21 in emergency medical services# because this may be the very first
                  22 bit of honest to..goodness impact of RMP in any respect in these

                  23 areas,
                  24           DR, MC PHEDRM: The only thing I hav'e':.,to@tiddl-is  that
   Ace-Federal Reporters,  Inc. Dr. Scherlis prepared his own material and made intelligent
                  25





                                                                             143


      dh 2       1  comments.  I move to accept his recommendations.

                 2             DR. ROTH:  I second.
                 3             DR. MARGULIES: It has  been  moved  and  seconded  that
                 4  the recommendations of this speciallreview committee be approved7
                              'BP mm
                 5             Let me say again that in this, as  in  other  kinds  of
                 6 applications, we -- whether we know  exactly  the  amount  of  money
                 7  available or not is incidental. we do try  to  look  at  the  qual-
                 8  ity of the proposal rather than the funds  available  and  try  to

                 9  match the two together.
                10             There are practical reasons for doing that, and
                11  quality reasons for doing that.  They  worked  hard.  It  was  an
                12  extraordinary exercise, and the  comments  have  appreciation,  I'm
                13  sure the staff endorsed totally.
                14             Is there further discussion  of  this  recommendat  on?
                15             DR. ROTH: Only to give an  order  of  magnitude  to  Dr.
                    Scherlis' comment about the bulk of the material, since it arrived
                16
                    one day before I left on a 10 day  trip  around  the  country.  I
                17
                18  weighed it.  Sixty pounds of it.
                               DR, MARGULIES:  We had planned on your cancelling
                19
                20  that trip,
                21             (Laughter.)
                22             DR. MARGULIES:  Any further discussion?
                23             DR. DE BAKEY: I would like  to  ask  one  question  in
                24  regard to this program. It seems that  as  Dr.  Roth  said,  this
  Ace - Federa I Repoiters,  Inc. may have potentially great impact and I'm wondering if the
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                                                                           144


     dh  3      1  council wouldn't do well to give some thought to assessing
                2  this in terms of its total priority of funding in  this  area?
                3             DR, MARGULIES: I don't know if you  all  heard  Dr,
                4  DeBakey,  He was commenting and agreeing that the emergency med-
                5  ical area is one that is particularly appropriate for  RMP*  and
                6  rather than merely taking action on the motion,  he  wonders  if
                7  it might not be appropriate for the council to comment on the
                8  kinds of priority it would give for funding  on  the  assumption
                9  there may be competition for funds.
               10             DR. ROTH: Well, it probably is  important  for  the
               11  council to recognize maybe everybody does,  but  for  example,
               12  you will nothing that Florida which typifids;#, one problem  was
               13  turned down completely,, zero, disqualified.  Not because it
               14  wasn't one of the best programs in the whole bunch, but because
               15  it had been previously fully funded through a forM&I-RMP grant.
               16             I just bring this up as evidence of the  fact  that
               17  this is not an exclusive program.  This is using some money.  We
               18  don't even know how much, really.
               19             DR, MA@ULIES: There are  two  complications  for  any
               20  kind of action you might take on the priority.  One has to do
                   with whatever we do between now and the end of the  year,  and
               21
                   the other has to do with the level of encouragement we  give  to
               22
               23  programs either that meet our needs and could not be funded, or
               24  programs that need further development and  refinement  during
  Ace - Fedefat Repottefs,  Inc. the coming year.
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      dh 4        1            I received a note just now that the house has --
                  2 the committee actually of the -- subcommittee on appropriations
   0              3 has reported out a recommendation of $150 million in grants
                  4 contracts, etc., for RMP'S,  At least we have one stage of the

                  5 discussion under way.
                  6            I donit bring that in because it means anything spe-
                  7 cifically, but it calls to mind the fact we have another year
                  8 coming up and priority considerations which the council is

                  9 concerned with.
                10             DR. DE BAKEY:  I think it has appeal, too, in addi-
                11  tion, so that I think it deserves considerable and serious
   0            12  consideration.  Possibly encouragement of the whole as expected
                13  of the program,
                14             I don't think this is being done well in most of the

                15  programs.
                16             DR, KOMAROFF:  How does our action effect the council
                17  approved level for a region and is there any flexibility for a
                18  region that gets this awarded to take any of that money and
                19  redirect it into other activities.
                20             DR. MARGULIES:  No.  What we will have to do, when
                21  we are through with those special actions, is request of the
   0            22  council a motion to adjust the level of the RMP to acommodate
                23  whatever has been approved by supplementary grant.
                24              But the exacty way in which these awards are going
  Ace - Federal Reporteis,  Inc. to be handled is -- we still have to negotiate because it
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       dh 5     1  depends in part on the language attached with any release of

                2  the 7.5 million and any language with the release of the remnant

                3  of the AM money.
                4             If they say we can spend it but not raise the level
                5  of commitment, we may have to release funds for  more  than  one
                6  year. If not,, then we can work it out over a  period  of  time.
                7  So if you take the action to allow the region to adjust its,
                8  level,, it can do any internal manipulation which it needs.
                9             It does,,imply a raised level of commitment on paper,
                10            Any further discussion?  Does anyone want to take
                11 further action, or did you want to amend the motion?
                12            DR. DE-BAKEY:  No.  I really didn't mean it that way,
                   I thought it was just wise that we take cognizance  of  the  im-
                13
                14 portance of this program, for one thing,  and  secondly,  to  --
                15 as an ---express some kind of sense of power  on  it.  I  didn't
                   want to get into the establishment, but rather than to   Iexpress
                16
                17 a sense -- in the sense that council wishes to express that,,
                18                                     to do.
                                                              "T
                              DR, MARGULIES:  Well,, without going through the

                   motion processt may I feel free in stating or in taking this as
                21 a sense of the council this  emekgehcy@modioal  activity  is  of
                22 high priority And should be given full consideration in any
                23 executive funding?
                                    'nods.  All right.

  Ace - Fedefat Reportefs,  Inc. If there is no further discussion, all  in  favor  of
                25






                                                                            1 47




       dh 6     1  the motion say aye,

                2             (Chorus of ayes.)

                3             DR. MARGVLIES:  Opposed?

                4             (No answer.)

                5             DR. MARGULIES:  Thank you.

                6             DR, MILLIKAN:  I have a question.  Somebody like

                7  Tristate now, two and a half million, what will  the  phasing  be?
                8             DR. MARGULIES: That's part  of  the  problem.  If  OMB
                9  says you can use it, the money, but you can't  raise  the  c(x=it-
                10 ment level in the second and third year, we may  have  to  devise
                11 a method of either scaling it down or doing what is effective
                12 forward funding of it to make sure it is made available.
                13            That kind of acting process has not been selected
                14 yet* We are still trying to get it clear.  We  have  a  few  days

                15 left.
                16            DR, MILLIKAN: I'm also looking at  it  from  their  end
                17 of the line. If they get 2.5. what kind  of  continuity  is  going
                18 to be established at the other end?  This is quite a change?
                19 How much will they need to continue, what's the second year
                20 level# third year level?
                21            DR. MARGULIES: If we find  that  the  potential  level
  -0            22 at stake is higher than they can reasonably expect  to  reach  by
                23 rejuggling  11 we will not get them involved in that kind of
                24 spiral because there is that danger.
  Ace-Federal Reporters,  Inc. DR, SCHERLIS: That has to be a very carefully
                25






                                                                               14 8




     dh 7        1  monitored lprogram.

                 2             DR. MARGULIES:  This is what we can determine when

                 3 we know our total funds available  and  make  some  kind  of  guess,

                 4 with luck, this month on what the level will be in the subsequent

                 5 year. we are really  walking  a  tight  rope  on  this.  The  recom-

                 6 mendations we need, the  final  action  will  be  very  complicated.

                 7             DR. DE BAKEY: chances are it  won't  be  less  than  one

                 8 fifty?

                 9             DR. MARGULIES:  I wouldn't think so.
           0    tio            DR. KOMAROFF:  Could there also be a sense of council
                11 that any requests come through the formal process?
                12             DR. MARGULIES:  There is no question about that.
                13 They will. This number of us  like,  and  there  was  no  choice  we

                  i@
                   owe
                               The next item for discussion will be the applications

                16 for health maintenance organizations which will be        Dr. Mak

                17 Leod here?
                18             Jerry, would you like to join us up at the front tabl(?
                19 Mr. Riso is now with us.
                20             We will go through the HMO applications#, through the
                21 education applications, and then we will do our very best to@.get
                22 to those requests for action  which  depend  upon  the  presence  of
                   individuals who are here  only  for  this  afternoon.  We  will  try
                23
                24 to keep things moving as effectively as possible.
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       dh 8     1  moment, I will turn it over to Dr. MakLeod:.  There are three
                2 members of the council who participated in the final review
                3  process of HMO applications.  They are present here today.
                4             Dr. Komaroff, Mr. Watkins, and Dr. Cannon.
                5             DR. MAK LEOD:  I want to thank you for the opportunity
                6  to present this part of the application process of the HMO ser-
                7  vice.  As I indicated this morning, this was my intent for the
                8  day, and I'm glad to have the opportunity to go over it with

                9  you.
                10            I thought it might helpful.just to briefly review the
                11 -- where the HMOS is today ano some of it has been mentioned
                12 earlier today.  I think it would be helpful to summarize just

                13 for the record.
                14            We have in reserve here a copy of the pink sheets that
                   were prepared    for the interprocess and they can be brought in
                15
                   if you wish.  Rather than clutter up the process, we have them
                16
                17 outside on a table.  If you wish to have them brought forward,

                   we would be happy to do  so.
                18
                19            The ad hoc group  does have copies of the pink sheets
                20 in front of them.  They are  the yellow colored books with the
                21 green binders.
                22            Mr. Carfin, do you want to bring those books forward?
                23            DR. ROTH:  Would it be possible to have this deferred
                   to the next council meeting?   I'm not prepared for the stuff in
                24
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      dh 9                     DR. MAK LEOD: Let me just say  what  has  happened  to

                2  date is that the review process was intended, at the session

                3  last week, was to really -- actually  review  the  review  processes

                4  itself. Instead of having the ad hoc  group  and  the  other  mem-

                5  bers of the financing project review group go  over  in  detail  all

                6  the applications.  Let me explain briefly where the process

                7  starts, and where it is at the present moment  within  th  s  par-

                8  ticular sequel.

                9              A request for applications  for  continuation  supportf

                10 no new support,, of existing grant applicants to  the  HMO  service

                11 were sent out during mid April and at that  times  it  was  announce
                12 that the review process would be essentially decentralized to

                13 the regional health directors offices throughout the country@.
                14             The processes involves a review at  the  regional  level
                15 involving the Social Security  Administratioht  the  Social  Rehab-
                16 ilitation Service, and various  programs  within,H8MHA,@,  @In  some
                17 of the regions, there are special advisory counsels to the
                18 regional health director as in California,  which  is  composed  of
                19 the California Medical  Hospital'Association,  the  regional  med-
                20 ical program in that areas the  organized  labor  sits  in  on  that
                21 committee, and other members of  council  summer  groups@are  rep-
                22 resented on that particular advisory committee.
                               It was our feeling that nod to have cross contact
                23
                24 between the central office and the regional office that the
  Ace-Federal Reporters,  Inc. that their should be a representative from the central group
                25






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     dh 10       I sitting in the regional review process.  At  the  regional  reviiew

                 2 processes each of the applicants were asked  to  make  a  presen-
                 8 tation approximately two hours in  length  before  this  composit
                 4 group. We then turned it around and asked  the  --  for  a  central
                 5 review that involved different programs  within  KSMIIA,  including
                 6 the regional medical programt  comprehensive  health  plan,  plus
                 7 regional representatives to come in  and  to  provide  continuity
                 8 now from the regional level back to the central level.
                 9             The central review is more highly  technical.  I  th  n
                10 it's fair to say the regional review reflects  many  of  the  local
                11 programs that exist and a regional action with respect to a
                12 deferral or a disapproval, would  be  considered  by  our.standards

                1 3as a mandatory action.
                14             At the central level of actionst we would review
                   those actions which have been  approved  regionally,  and  tIo  the
                15
                16 extent that we approved them, which was usually with conditions,
                17 the action would then be generated one further level.  That leveL
                18 was to a -- what we have used in the past which was an outgrowth
                19 of a policy coordinating committee that was made  up  of  the  Soc-
                20 ial Security Administration, NIH, OBO, and to this group, we
                21 asked the ad hoc group from the regional medical program nationaL
                22 advisory council to join in the discussion*
                23             At that time we presented the -- generally  the
                   service to date with a -- the grant  activity  during  the  first
                24
  Ace - Federal Reporters,  Inc. sequel, the second sequel# and at the present time, and showed
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    dh 11         1 the trends that had taken place and the proposed -- the past

                  2  expenditures and past all locations of money.  The dialogue was

                  3active and vigorous and several proposals which made and incor-

                  4porated into the award proposals which,we are,not presenting

                  5before this particular council for an even block action.

                  6            I would at this point in time perhaps turn it over

                  7to a representative of the ad hoc group to ask for their reactions

                  8and responses.

                  9           DR. CANNON:  I would say that the review process@@was

      end 15      10 certainly  adequate

                  I 1


                  12


                  13


                  14


                  15


                  16


                  17


                  18


                  1 9


                  20


                  21


                  22


                  23


                  24

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                                                                                153

     CR 6499

     Take 16      1              DR. MARGULIES:  Could you use the microphone?
     dw 1         2              DR. CANNON:  So far as the review process, as
   0              3  Dr. MakLeod has described to you, we thought the review
                  4  process was certainly adequate, in some places too much,

                  5  perhaps, being confusing.

                  6              There were several points which we discussed that


                  7  council would be interested in.


                  8              We did rehash again  the  absence  of  any  reference

                  9  to an ongoing educational process which the council previously

                10   had stated in its minutes as being necessary if we were

                11   going to be charged with any responsibility of quality -- for

                12   assessment of quality.

                13               Likewise, on some  occasions,  we  found  that  there

                14   was inaccurate information on whether or not certain


                15   groups were officially signed up for HMOs.

                16               But if you will turn to -- you don't have this --

                17               (Laughter.)

                18               DR. CANNON:  If you have it, you would see that

                19   there is a  diversity of groups applying  in  quite  --  I  can't

                20   find it myself.

                21               (Laughter.)
   0            22               DR. CANNON:  In  which  the  medical  schools,  about

                23   9 percent,  and the physicians groups and foundations,

                24   total about 30 to 42 percent and the hospitals about 10

  Ace-Federal Reporters,  Inc.
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                                                                           154
    dw 2


                    companies and private, about 20 percent.
                 2             Now, if you put the physicians groups, medical
   0             3  schools, and hospitals into one category, you would see that
                 4  they do have the potential of developing an educational

                 5  component.
                 6             The last two, which consisted of about 40 percent

                 7  of the consumer public, insurance company, and private,

                 8  we did not see the evidence of it.

                 9             Now, I have no further comment.

               10              I will pass it on.
               11             I-think Dr. MakLeod and the group did an excellent
   0           12   review.
               13              Where the council stands in its involvement in

               14   HMO is the question and that will probably be discusse

               15   later.

               16              DR. KOMAROFF:  I think with regard to assuring
               17   quality of care standards, the one provision that we spoke
               18   about being sure to incorporate if it wasn't possible to

               19   have a formal linkage with a medical center was some
               20   evidence of a functioning peer review system within the
               21   HMO, union based HMO, so that there would be some device
   0           22   for assessing quality of peer.
               23              Otherwise, any RMP involvement would be very

               24   difficult for this council to support.

   Ace-Federal Reporters, Inc.
               25              Basically, I supported the councils awarding the

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                                                                          155
    dw 3

                 1 bloc support of the review procedure as it has been defined by
                 2 HMOS and will support that later.
                 3            DR. MARGULIES:  Dr. Watkins?
  40                          DR. WATKINS:  We all agreed on the review process
                 4
                 5 and I support this also, but Dr. MakLeod detailed the
                 6 quality care especially based on the fact there will be
                 7 internal and external audit and surveillance.
                 8            One of his staff explained the educational com-
                 9 ponent in our opinion fairly satisfactorily.
               10             We think ths procedure should be approved.
               11             DR. ROTH:  I hate to be so ignorant about this thing,
               12  but I am still totally at sea in respect to statements  made
                   this morning that there was as yet no single RMP dollar
               13
               14  involved in HMO funding and I believe that was a statement
               15  this morning4
               16             We are now considering RMP involvement in what  I
               17  now see is a second group -- third cycle, but, at any  rate,
               18  the present cycle is to consider 37 of those whose  fundings
               19  had run its course.
               20             Now, are we talking about RMP money or aren't we?
               21             I can't seem to find anybody that will give me
               22  that answer.
               23             DR. MARGULIES:  This is the first request for
               24  RMP grant money to go into the support of HMOs.  There is at
  Ace-Federal Reporters, Inc. present no RMP money which is going into contracts.
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     dw 4                        There is under consideration as a part of the

                 2   $16.2 million some funding which will be used by the contract
                 3   mechanism, not to support HMOs but to support collateral
                 4   acitvities which will enhance the HMO development.
                 5               This will still leave a residual of approximately
                 6   $7   million.
                 7               So what we are talking about is a first request
                 8   to this council for grant support for HMOs for a total of
                 9   $4.3 million, whatever the sum may be.
                                 We are going to have approximately $5 million
                I 0
                11   of RMP money for collateral contract activities in HMO and
                     approximately $7 million remaining for general RMP
                12
                13   activities of the 16.2 that we have been discussing.
                14               DR. ROTH:  And this is the first time this entire
                15   subject has been on this table before this council, is
                16   that correct?
                17               DR. MARGULIES:  That is right.
                18               And the first time HMO funds have been requested
                19   of the council.
                20               DR. ROTH:  I rest my case.
                21               DR. MARGULIES:  We have talked about HMOs in
                22[ p revious meetings but not in such.terms.
                                 Jerrv, would you like to comment?
                                                                                          Nk,
                                             The HMO has three sources of funds.


  Ace -Federal Reporters,  Inc. It is true that to date there has been no use of RMP money.
                25 1



                                             A I Soo                            157

   dw 5           1              That is not the first time the issue has been
                  2  addressed because we identified earlier at the beginning of
                  3  the year the three sources of funds for HMO funding and we
                  4  have reached the point where involvement of the RMP funds and
                  5  the RMP council, the RMP staff, is necessary.
                  6              Our intentions  have been clearly indicated, three
                  7  kinds of ways, I might add.
                  8              It has been clearly enunciated from the start, all
                  9  during the fiscal year, that our intentions were to fund
                10   the RHMO activity from three sources, RMP being one of them.
                11               We identified our intentions in front of
                12   Congressman Rogers and his committee as to use of RMP funds
                13   for continued HMO activity, to   continue further the work
                14   we had started with the -- some 110, not all of which would
                15   qualify, but the 110 grants made about a year ago.
                16               We repeated our intentions on this subject before
                17   Senator Kennedy.
                18               So there has never been in our minds, at least, any
                19   question as to the use of RMP money, never a question in our
                     mind we would go the grant route and never any question in
                20
                21   our mind we would follow the conventional council procedures
                22   in doing this and that is what brings us here today.
                23               DR. DE BAKEY:  Why didn't you?
                24               As far as I am concerned, you haven't  followed the
  Ace - Federa I Repor teis,  Inc. Congressional procedures.
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                                               pep 15A 1.i ir              1 58
   dw 6                                                     ly

                 I            This is the first chance I have received  to  hear

                 2 anything about the grant applications, yet you ask me to come
  is             3 up and participate in a decision about the applications.
                 4            MR.RISO:  We did have a subcommittee acting

                 5 hopefully on behalf of this council to review the materials.

                 6 That is the way we have always done.
                 7            We believe we were following a process  we  would

                 8 follow in other kinds of activities previously.

                 9            DR. DE BAKEY:  I want to challenge your statement
               10  about that. In the first place, you are  taking  for  granted
               11  the same kind of procedure we have used on all others.
               12             You made the decision that this was a  part,  that
               13  RMP could be interpreted as a means of supporting HMOs.
               14             Congress didn't make it and this  council  didn't

                   make it.
               15
               16             The council did go along with the idea of supporting
               17  one aspect of it, the educational aspect.
               18             This is administrative decision, not a council
               19  decision.
               20             You are now telling me you followed the same
               21  procedure when you haven't. This is the point  I  am  trying
               22  to make.
               23             This is a new subject,matter 'for this:council  to
               24  consider completely in terms of its responsibility to advise
  Ace-Fedetal Repoiters,  Inc. regarding the disbursement of funds of regional medical
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                                                                           159

   dw 7


                1  programs.

                2             That is the point I am trying to make and tried to

                3  make earlier today.

                                    K      NM-
                4

                   met, it was apprised of the fact that we intended to use

                   the funds this way.  It agreed that it would appoint -- woul

                7  allow me to appoint a subcommittee which could act in your
                8  absence and the fact we did not do that was based upon the
                9  lack of need and the lack of timing for it.
                                                                                    am
                              Ja %A 4-  he c@uncil fu   cussed it.

                             q%               --
                              D       AKEY:  I w@g

               12             DR. MARGULIES:  But it did.  It met and acted and
                                                       -0  imism
                   agreed to do that and--  Oint a su         e  to I
               13
                              DR. DE BAKEY:  Maybe so.  I didn't  agree to do it.
               14
               15  This is an interpretation.
               16             DR. CANNON:  I would like  to say as a member of the

                   subcommittee            =_a@ked to come up here on short
               1 7
                   notice and speedy actioni we were asked to aRprove the
               18
               19  review process.  That was our request and that is what we were
               20  told.
               21             DR. MARGULIES:  What we had expected would occur.
               22  As I indicated to you earlier this morning is that there
               23  would have been action in the spring, early spring, on HMO appli-
               24  cations.  There would not have been time for the council to
  Ace - Federal Reporters, Inc. meet again prior to that action, so in fact, what the council
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                                                                          160

   dw 8

                 1  did was to delegate final authority to a subcommittee.
                 2            It was not necessary for us to exercise that  action

                 3 because the review process for HMOs that we are considering

                 4 now was delayed allowing us therefore the  ree om to

                 5 bring it back into full council.

                              If we taken literally the action of the council last
                 0
                 7 time, we could have used that subcommittee to complete  action.

                 8            We thought we shouldn't.
                 9            DR. CANNON:  I think you are right about it.
               10             I remember your delegating it, except the  authority
               11  of the review committee is to review and comment on the  review
               12  process, which we did, not on the question of whether or not
               13  funds from RMP should be used to establish HMO.
               14             DR. MARGULIES:  Quite right.
               15             DR. CANNON:  That wasn't the question put before the
               16  subcommittee.
               17             I think that is -- now, this thing has been
               18  discussed in council for many, many months.
               19             Vern Wilson discussed it with the council a long
               20  time ago.  I think the final decision as to whether RMP funds
               21  would be put into HMOs -- I don't recall the minutes of the
               22  action.
               23             DR. MARGULIES:  You are absolutely right.
               24             What we wanted was to bring to this council, council
  Ace-Federal  Reporters,  Inc. members' judgment on the validity of the review process.
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                                                                          16 1

   dw 9

                 1            DR. CANNON:  You have got that.

                 2            DR. MARGULIES:  Yes.
                 3            The question before the house now is whether this --

                   that this review is an,appr'optiate basis for any action you
                 4
                 5 can take and the collateral question then is does this
                 6 council wish to utilize a portion of the funds set aside for
                 7 the HMO activity with the understanding that it is a one-time
                 8 grant award to continue the planning and development of HMOs.
                 9            There is no time excepting now to do it because
               io  this is the end of the fiscal year and that is the issue.
               11             DR. CANNON:  In other words, find nothing wrong with

               12  the review process.
               13             The question before the council, the subcommittee
               14  having acted in their behalf, that there is nothing wrong
               15  with the review process.
               16             The question now before the council is do you wish
               17  to devote the funds to this project or not.
                              MRS. WYCKOFF:  Is RMP being used as a kind of pass-
               18
               19  through for funds to HMO?
               20             DR. DE BAKEY:  This is one of the sources of
               21  funds, that is all.
               22             MRS. WYCKOFF:  It isn't RMP money, is it?
               23             DR. DE BAKEY:  It is partly RMP money.
               24                         It was in fact earmarked at one point
  Ace - Fe I Repofters,  Inc. in time for use. When some 16.2 was released, it was released
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                                                                  162

   dw 10

               1  with the thought -- the report of the Senate indicates using

               2 16.2 to "try out" the HMO concept.  The issue, to be perfectly

               3 candid, you have two things:

               4          Onet you have it as a source of funds.

               5          I think you have to face that as a fact.
               6          Secondly, we feel it is a legitimate source of

               7 funds.
               8          It is a necessary and important involvement for

               9 RMP in the HMO program.
             10           MRS. WYCKOFF:  Even though it is a one-time kind of

             11  thing?
 e4 16       12
             13


             14


             15


             16


             17


             18


             19


             20


             21


             22


             23


             24

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     #17-ter-1

                 I             MR. RISO: It is  a  one-time  for

                                              JL cna-Lienge your         t about that

                 3 too. You may think it  is  necessary  for  us to get  involved  in

                 4 it, but that does not mean that  we  have  --

                 5 DR. SCHREINER:  Would you speak into the mike?

                 6             DR. DE BAKEY:  He says he regards it as a -- what

                 7 did you say?

                 8             MR. RISO-.@-If you want to take issue with  the  term

                 9 "appropriate"?

               10              DR. DE BAKEY:  I take issue with it because I do

               11  not think we have had a chance to discuss it in relation to the

               12  appropriateness of using it for this purpose.

               13              One:thing, I think it is important to define what

               14  you mean by HMOs and what theyare going to do and ot what
               15  extent they are able to do something  for  the  regional  medical

               16  program which the regional medical program cannot do.
               17@             I do not think we have had a discussion of that
               18  at all.     am n-i              is.advances the regional medical
               19  program       ade statements earlier that I had to aamir--we--nav
                  rnot advanced  the re ional medical  programs,  particularly  with
                                       9

                   the intent of Congress, and I have to say so, officially

                         lic record.
                               -I ttinwk there is good reason and good evidenc-e
               24  it.  You are now coming along with another program that you

  \ce - Federal Reporters,  Inc.
               25  think does.  What is the basis for your thinking of it?  You

                 I





    ter-2                                                                       164



                 1  have not convinced me of that.

                 2             Your word is not enough for me.
   0             3             MR. RISO: You  raise  two  issue's,  Doctor.  You  raise
                 4  the issue of lack of discussion.  I  find  that  difficult  to
                 5  accept, that there has not been  discussion  about  our  intent  or
                 6             DR. DE BAKEY:  No.  I raised the issue of lack of
                 7  discussion in terms of the :substance of the program, not in
                 8  relation.to whether or not we  should  be  involved  in  it.  That

                 9  is the point I am making.
               10              MR. RI-SO: I can only  tell  you  about  my  involvement
               11   with this council.  I suggest it has been minimal.  I do not
   0           12   know what conferences you have  had,  to  date,  among  yourselves.
               13              DR. DE BAKEY: As far as  I  am  concerned  we  have  had
               14   no discussion of the substance-@of HMO programs in advancing
               15   As a matter of fact, we were supposed to have -- this is what I
               16   understood was the role of this  delegation  in  determining  t  e

               17   review processes.
               18              Now, you are coming back to  us  now,  and  wanting  us
               19   to approved funding. That is  the  point  I  am  making.  You  can
               20   do it,by contract, or you can do it with -- with or without
               21   my vote, but I am expressing  my  own  feelings  about  that.  That
               22   is what I am trying to make in  terms  of  my  responsibility.
               23              DR. ROTH: I would like  to  say  for  Mt.  Riso's  bene-
               24   fit, because he was not here when it  was  said  earlier  this
  kce- Federal Reporters,  Inc. morning, that some of the important, extremely important
               25





    ter-3                                                                  16 5



                1 material in this whole issue has just come to us in the

                2 distributions that we got at home, and that we have here before

                3 us in the black book.

                4             I would point out for example, the General  Counsel

                5 opinion, dated May 3kd,, which raises a very significant  ques-

                6 tion, as far as I as a member of this advisory committee is

                7 concerned; that is the question was, do we have the legal

                8 authority to use RMP money and the legal counsel answer  is  to

                9 the extent that proposed HMO activities fall within  the  pur-

               10 poses of Section 910(c), we do.

               11             Then, reading 910(c), the connection between  HMOs

               12 and what is actually being done with the monies that have been

               13 given for HMO development and any of the words in 910(c) seems

               14 to me to be unrelated.

               15             I think we ought to have a chance to discuss  this

               16 in this council.  That is all I am saying, is that it seems

               17 to me perfectly clear that the members of this council have not

               18 been sought, and that we sit here approving grants, having them

               19 unfunded because some of our monies, particularly  because  910

               20 money, are being diverted.

               21             If this is the way it is to go, I think we  should
   0           22 at least have a chance to express our opinion about it.  It

               23 may prevail. Maybe that is the way the council  wants  to  go.

               24 But, I think the council should have a chance to say so.

  @ce- Federal Reporters,  Inc.
               25             DR. MARGULIES:  Russ, in fairness to the other




     ter-4
                                                                                16 6



                 I  members of the council, this was discussed at the last meeting.

                 2  I brought it to the attention of the council that the funds

                 3  were going to be used for that  purpose,  that  it  would  be  done

                 4  in such a way that it would  direct  those  funds  to  HMO.  I  made

                 5  the point that the council  which  it  understood  that  the  review

                 6  would be by the HMO service, and that this was a method of

                 7  getting activated, a program of health maintenance organization

                 8  which was considered of significance.

                 9             During  that  discussion,  there  were   potentialities,
                10, particularly in the  development  of  methods  for  monitoring  the
                  I
                11  value of care for RMP  growth,  which  were  identified  which  were

                12  considered worthwhile.

                13             It is always true  in  any  council  action,  that  some
                14  members are present and some are not.  It is also true
                15  that any council action is subject to reconsideration.      But

                    the council then made -- passed an action in which they     said,
                16
                17  if it is necessary for these funds to be used for grant     pur-
                    poses prior to the next meeting of,the council, we will     delegate
                18
                    full authority to a subcommittee of the council to act in
                19

                    our behalf.
                20
                21             This was dpne with full understanding.   I  It  does  not
                22  mean you have to sticX with it but  it  did  occur,  and  there  was

                    discussion.
                23
                               DR. ROTH*.'  I was present when a substantially
                24
  \ce-Federat Repofters,  Inc. different statement than that  was  adopted,  and  reprinted  as  an
                25





    ter-5                                                                   167



                1  Attachment F to the minutes. This was  not  the  original  state-
                2@ ment and we had a lot of discussion about it in the council and
                3  we did not like the way the thing was  originally  proposed,  and

                4  we came out with something that I think none  of:us-really  saw:,

                5  in  writing.

                6             My impression of what we did is  almost  reflected  by

                7  this Attachment F, to the minutes where it  says,  the  council

                8  shall discharge@.its -- by delegating to a subcommittee  of  the

                9  council actual authority to work with the Director of RMPS.

               10             It was not my understanding they  were  authorized  to

               11  approved grant applications and this was the  first  time  that

               12  this was brought up before the council, which is  what  has  led

               13  me to do a little bit of homework oh where RMP  grant  moneys  I

               14  mean where HMO grant money has come from, which  I  reported  to

               15  you this morning.
               16             I think the council has  been  beautifully  railroaded

               17  on this one.
               18             DR. MARGULIES:  I am sorry you think so, but in
               19  any case, the council is here to consider  it.  The  grants  have
               20  not been approved, they have not  been  awarded.  we  ave  come
               21  as closely as possible to what we thought  you  should  do.  In
               22  fact, there was so much attention to the wording  at  that  time,
               23  that there was.a.group.which,met separately, reworked the
               24  wording of that action, brought it back into the council, and ii
  \ce -Federal Reporters,  Inc. ed by the council after it was reworked.
               25@ was pass




    ter-6                                                                 16 8



                1            But you are not bound by that.  You are here to
                2@ consider what action you want to take on this particular HMO
                3 Grant award.

                4            DR. PAHL: Before we proceed, Tony, let me  say,  the

                5 conditions under which that Attachment F were developed,  you

                6 may recall, were somewhat time-limited because individuals

                7 were leaving the council.

                8            Staff developed that statement and as I recall,  got

                9 two or three of you to look at it, most momentarily,  before

              10  leaving the council room.  So the fact that it appears in the

              11  cold light of day not to be what you thought you had read  it

              12  to be, is quite possible and I think that if that is the  daser

              13  and if it is not the sense of what you formerly thought  you

              14  had approved, it would be most appropriate not to approve  te

              15  minutes, but to make an amendment to that.

              16             This is part of the problem of trying to get  the
              17@ business down with leaving, but also staff should have gotten
              18  this Attachment out to you, prior to your coming to the council
              19  meeting this morning. So. I think that should  be  a  consider-
              20  ation of the council if the minutes are to be changed from what

              21  the action taken this morning was.

              22             Toxiy?
              23             DR. KOMAROFF: I did not put the period  after  RMPS,
              24  but to approve applications for HMO Grants.  When you are

  kce -Federal Reporters,  Inc.
              25  called down to look at the review process, I have ambulant

                 I





    ter-7                                                                  169



                1  f eelings.

                              We were looking at the grants and we had to take

                3  secondhand, any assurances about the adequacy of the review

                   process.  I was assured and I would like to move that we

                   have expressed our feeling about the way this was handled and

                   the way council has been treated, but I would like to move

                   block approval action in support of the HMO Grants  as  approved

                   by other level review processes.

                9             DR. MARGULIES:  Moved.

               10             Is there a second?

               11             MR. WATKINS:  Second.

               12             DR. MARGULIES:  Moved and seconded.

               13             Further discussion?

               14             DR. SCHREINER:  Did you say something about forty

               15  percent of these not@coming under the umbrella of quality

               16  control?  I thought I heard something like that.

               17             DR. CANNON:  What I said, was that council in its
               18  minutes,, not once,,but several times, even to preparing a
               19  statement saying that if the -- if it became involved  in  HMOs,
               20  especially the quality of any health care program;,that it
                                                                       WWI     p
               21  would insist on an e cational component in an  effort  to  main-
               22  tain quality, and that educational component should  be funded
               23  hot out of the costs of the medical care program.
               24               do not know where the minutes are, Harold, but I
  \ce -Federal Reporters,  Inc' am sure somewhere we went through that, because they  wanted  to
               25





    ter-8                                                                  170


                1  assess quality in the program.  When we met, we were not asked --
                2  I did not understand we were asked to go any further then
                3  approving the review process, what it was, and making suggestions
                4  about the adequacy or inadequacy, and the review  process  was
                5  certainly adequate, but there were things that wer  eleft  out;
                6  and one was the educational component.
                              This was discussed, and I have here, a report t at I
                7
                8  wrote -- that John wrote for me, as an addendum to  what  should
                9  have been the charge of any organization that wishes  to  start
               io  a HMO.  Of those organizations which had applied for grhats
                   already funded, there were those with a hospital, medical schoo:.,
               12  the foundation, the physicians' groups.
                                                            p  11 11
                              They easily could incorporate an  educational  com-
               14  ponent, continuing education or the process of  training  man-
               15  power. There were 40 percent or rather 38  percent,  18  and-20
               16  of either insurance company or consumer-base sponsorship
               17  which we did not see that that was assurance that  there  would
               18  be an educational component for -- to initiate at least on

                   the front end
               20             DR. DE BAKEY: I think it is one  thing  to  approvea
               21  review process, but I think it is another thing to ask  for  the
               22  approval of funds to support a program, the nature of  which  in
               23  terms of its relation to the advancement or let us say, the
                   achievement, accomplishment, of the regional  medical  programs'
               24
  @ce - Federa I Repof  ters,  Inc. intent and goals, and objectives, is yet to be  determined  and
               25




    ter-9                                                                      171


                 1 certainly it -- as far as I am  concerned,  there  has  been  no

                 2 convincing evidence to provide  us  with  the  conviction  that

                 3 this will further the regional national medical program, and

                 4 yet, we are asked to approve monies on that basis, and on the

                 5 basis, that the review process has been satisfactory.

                 6             Well, now, there is a lot of difference between a

                 7 review process that is satisfactory  or  adequate,  and  a  pro-
                 8 gram that needs to be funded to advance the cause of the regionzl

                 9 medical program.

               10              I think in terms of the responsibility of this councl

               11  for the approval of funds for  these  purposes,  it  should  be

               12  provided with that evidence, not just with the evidence that
               1 3 the review proces is satisfactory, or that we should participat(-

               14  in the program.

               15              That is the point I have been making all along that

               16  each one of us as a member of  this  council,  has  a  definite

               17  responsibility, authorized by the  law,  to  provide  advice  on

               18  funding of programs, that will  advance  the  cause  and  intent

               19  of  the  law.

               20              Now, here you come with  a  HMO  organization,  the

               21  exact nature of which is still not  clear,  and  how  it  is,to

               22  be operated or anything else, these are funds you want to
               23  support the development Of. Now,  just  how  that  is  going  to
               24  advance the cause of this, and therefore, the monies by which

  kce- Federal Reporters,  Inc.
               25  we determine the approval of.fuhds is not presented.




    ter-10
                                                                             172


                 1             I know we have talked about it. I  know  all  that  you

                 2 have said since early January.  I know all of that.  But, we

                 3 are coming now down to voting on the funds.  This  is  where  I  am

                 4 and this is why I cannot really, in a sense, participate in

                 5 voting on a motion of this kind.

                 6             That is the only point I am making.
                 7          @tAt.  WATKINS: Six months ago, I  had  the  opinion  that
                 8 the council had held jealously, the educational component.

                 9 When I was asked to come down for the  review  process,  I  assumed

               10  the input had been assumed already.  This is the method by

               11  which we were    ing to allow the funds to be involved.

               12                 we have six months of this discussion.  P6rhaps,
               13  I made a mistake and misunderstood the intent.  I thought the
               14  intent of council was to have this input educationally, and
               15  funded so when we are asked to come down for the review proce-
               16  dure, we are coming down to let down now, how the review
               17  procedure was set up to fund.  This was the final task.
    End #17    18              I got this over the last six months.

               1 9


               20


               21


               22


               23


               24

  kce -Federal Reporters,  Inc.
               25





CR 6499
                                                                               1 73
Tae 18


dw 1             1             DR. ROTH:  i would like to second what Dr. DeBakey

                 2 has said and make it clear if  there  is  any  misunderstanding,

                 3 that I think it would be a disaster, I  think  it  would  really

                   be flushing money down the drain if we carried 114
                 4
                 5 developmental experimental p'@o@3,781              oint and

                 6 then refused to fund them, somehow or other, to    see how  they

                 7 work, how they fly, what they show, and what we    should  learn

                   from them.
                 8

                               My point is that to  involve this  council I thin

                 io has not been well done, at least, as I  interpret the

                 ii reactions of the council members.

                 12            There seems to be a substantial difference of

                   opinion between council and staff on how well they were
                 13

                   clued in on these things.

                               I hop                  ays and means.  There   mu
                                                                               St

                                                                                 1
                 16 be ways of continuing the funding of  these  114  demonstration
                 17 projects until they are able to demonstrate something.
                 18            I don't want anybody to think we are against that.
                 19            I do think there is a very  serious  question  of

                   the appropriateness of the RMP monev a  nd certainly no question
                 20

                   if it is divorced from tne eya-iuat-i   factors Dr. Cannon
                 2 1
                 22 has talked about.
                 23            DR.MAK LEOD: I would like  to  address  the  issue,
                 24 Dr. Cannon raised and Dr. Watkins, too, that is health
  Ace-Federal Reporters,  Inc. education and continuing education, that it  should  be  a  part
                 25






                                                                                                                                                 1 74
         dw  2

                               1   of  HMO  activity.
                               2                        one  of  the  problems  that  we  face  to  date  is  that  we
                               3   have  not  funded  ongoing  service  organizations.
                               4                        The  criteria  for  that  phase  of  HMO  development  have
                               5   not  been  developed  todate.
                               6                        What  we  have  funded  has  been  the  planning  and  the
                               7   developmental  aspects  and  out  of  this  we  have  found  any
                               8   numbers  of  different  ways  that  different  organizations  have
                               9   proposed  these  kinds  of  activities.
                            101                         We  have  used  the  coordinating  committee  concept
                                   with  a  project  review work  group  and  now  added  to  this  particu-
                            12     lar  session  with  the  groups  from  the  national  advisory  group  to
                                   develop  the  policy  for  HMOs  and  to  incorporate  those  suggestion.,
                            13
                            14     into  funds  that  would  be  used  for  HMOs  activities.
                            15                          It  would  be  our  action  and  our  recommendation  that
                                   the  proposal  made  by  Dr.  Cannon  and  drafted  here  would  be
                            16
                            171    included  as  part  of  the  policy  development  within  the  HMO
                                @  service  for  those  applications  that  are  --  those  fugure
                            18
                            19     applications  which  will  be  considered  for  obligational
                            20     support.
                                                        DR.  SCHREINER:    This  isn't  the  form  of  a motion.
                            21
                            22     We  have  a  motion  on  the  floor.
                            23                          DR.  MARGULIES:    No,  no.
                                                        DR.  SCHREINER:    There  are  a  variety  of  reasons  why
                            24
    \ce-Federal Reporters,  Inc.   I  might  vote  against  the  motion  but  I  will  single  out  only
                            25





                                                                         17 5

    dw 3

                1  one for discussion.
                2             Regardless of confusion about prior comments at
                3  this council meeting and transmission of information and bits
                4  of news, et cetera, there has been one core item that I
                5  personally recall as having run through all  our  discussions
                6  and that core item was that if the RMP was going to be
                7  related distantly or closely to HMOs, it was going to  be  in
                8  the area of potentially furnishing and helping out with
                9  quality control.
               10             I see a few nods.
                              There may be a little bit of memory about some of thLs

               12  having gone on around you.
               13             Continuing that thesis, the idea of quality control
                   got exemplified by the business of "educational  component.11
               14
               15             Quality control might be put in a number  of  dif-
               16  ferent fashions, I presume@.   However, I just heard from
               17  Our own review committee, regardless of what they thought
               18  they were reviewing, I have just heard that 38 percent of the
               19  items recommended for bloc action did not have that component
               20  in them.
               21             I am going to have to vote against the motion.
               22             DR. MARGULIES:  Clark, the responsibility for
               23  developing effective methods for monitoring the quality of
               24  medical care in HMOs does remain in the regional medical
  \ce -Federal Reporters,  Inc. program and there is little question in my mind that the RMP
               25





                                                                        176

    dw 4

                1 is going to be the:most vigorous arm in the monitoring of
                2 HMOs in the Federal service.
                3            Regardless of the other features of the HMO
                4 activity,that represents an opportunity to develop techniques
                5 and to measure them and evaluate them for which we have no
                6 alternative.
                7            Our thinking has been along those lines.
                8            I would like to add one thing to  this  discussion,
                9 for whatever it is worth.
              10             As you might infer from the conclusions, the
              11  development of the HMO activity has not been one of  the  most
              12  brilliant in bureaucratic history.
                             It began with the assumption of  legislation  which
              1 3
              14  would have been passed about a year ago, with repeated assurances
              15  and, as.T indicated to you this morning, if everybody had sat
              16  around waiting for the HMO to develop, suddenly had a bill
                  passed and an appropriation at about this time of the year
              17 1
              18  and nobody had done anything, the criticism would have been
              19  the same.
              20             You have a group of people running the risk of
              21  mounting an activity to prepare for something which will take
              22  place, doing what they can, acting in what they  consider  the
              23  best interests of all, to develop momentum, staff, doing
              24  whatever is required to squeeze money here and there to get the
  kce -Federal Reporters,  Inc. job done, and this always does carry with it the likelihood
              25





                                                                              177


     dw 5           of being caught with your drawers down.
                 2              Well, that is where we are.  The fact is that we
                 3  needed money from any source  which  was  available  to  get  this

                 4  job done.
                 5@             It was not the last time this will occur.
                                There are possibilities in the future that
                 0
                 7  somebody else's money will be used for RMP.
                 8              If that occurs, I will bring it to your attention.
                 9              Where we are now, as I laid out to you fairly
                101 nakedly is  in the need for money  to  get  something  done  which
                11  has got to  be done.
                                You are in a position of saying "aye" or lonayll
                12
                13  to that idea here.
                14              MRS. WYCKOFF:  We said at the last minute that
                15  many of the RMOs are already involved.  I assume we were
                16  funding it.
                17              Secondly, it is quite clear  that  RMPs  will  have  a
                18  role in development of HMOs as quality of care monitoring
                19  and health manpower.
                20              This looks as though we were already in right up
                21  to our necks.
   0            22              How were those funded?
                23              DR. MARGULIES:  These are RMP encouragement.
                24              MRS. WHCKOFF:  They were not being funded?
  \ce- Federal Reporters, Inc.  DR. MARGULIES:   Not through  a  central  source,  no.
                95






                                                                        17 8
    dw 6
                1             DR. MERRILL:  I was looking at the same paragraph
                2  Mrs. Wyckoff was but I was thinking of some of the remarks
  0             3  of the previous sentences.  There is a clear understanding
                4  that review would not follow the normal RMP pattern.
                5             I gathered there was some question about that?
                6             (Laughter.)
                7             DR. MERRILL:  I would also like to know how firm or
                8  how much substance we can attribute to the remarks of
                9  Dr. Wilson on page 2.
              10              I ask this because if it is true that there has been
              II I considerable misunderstanding about whether or not HMO should
              12   be funded through the normal RMP mechanism, and this is indeed
                   a one-year activity, thenwe have made a five million dollar
              13
              14   misunderstanding which hopefully will not be repeated.
              15              I think as Tony has suggested, it might be more
              16   damaging having set these things up and reviewed them not to
              17   fund them at this point if we can be assured that the problem
              18   will be very well clarified.
              19              DR. DE BAKEY:  As I understand it, that one year
              20   activity is based upon legislation.that has not come:about@@@and
              21   certainly, from what I see in the Congress taking place right
              22   now -- may I get off the record?
              23              (Discussion off the record.)
              24              DR. ROTH:  Is it fair to ask -- so far, no RMP
  @kcE@-Fedetal Reporters,  Inc. money has gone into this in the '71-72 appropriations. Are
              25






                                                                            179


    dw 7        1  we now being asked to take it all?  Is it all going to come out
                2  or will there still be Section 1110 money from SRS?

                3              If so, what is the breakdown?

                4              DR. MARGULIES:  We are asked to contribute at this
                5  round 4.3 for continuing planning and development.

                           Whether there is additional money which is going to

                7  be used during the rest of this fiscal year from other
                8  sources, I don't know.
                9              Gordon, can you answer?
               10              DR. MAK LEOD:  This grant activity is with

                   respect to  the HMO service, is the only one that is going on

               12  at the present time.  SRS is involved in extending some of the
               13i activity in their evaluative projects that are going on.
               14              Part of the hundred and ten, but it is a limited

                   program, limited funds.
               15

                               MR. RISO:  The HEW policy, I think I have to

                   restate it  again, because -- I think we are talking to one

                   another, the policy is to fund --  the  ones  that  have  been

                   funded, that we would undertake, until legislation is passed,

                   whenever that would be, we would, one,    fund no   additional


                   grantees and, two, we would not provide    funds for direct

                   service, and we would confine our activities    to   assisting

                   those            hundred and  ten who were  determined  by  an
               2 3@
                   appropriate review that  thev  had made significant progress
               24

Ace-Federal Reporters,  Inc.
                   and deserved to be carried further
               25






                                                                        1 80
    dw 8



                I stage.


                2            This is what was intended to be done with the RMP


                3 monies right now.

                4            Our plans for next year will be to work  with  those

                5 that have been funded.


                             We have not identified 1973 in the absence of
                0

                7 legislation, anything like the earmarks that  were  established

                8 in 172.


                9            In addition to which, even if we had intentions

              10  of additional funding, we have gone on record as estimating

                  about the level of planning and development funds needed to

              12  carry forward a mature and appropriate applicant tc
              13@ p                                         ors and forget  about
              14  the planning and development work.

              15             We will have reached with many of these  that  point

              16  in levels of funding early in '73.

              17                                       onstraints on us:

              18             One, the fact we don't have funds, that is a very

              19  real one.

              20             The second constraint is that at some point in time,

              21  we will have exceeded what we think is a normal amount of money

              22  to spend for planning and development and it would be just

              231 a waste of time to continue funding planning and development

              24  activities of an organization that should have reached the
 Ace -Federal Reporters,  Inc. point of either being viable or forgetting about it.
              2 5






                                                                        181
    dw 9


                             That is the two constraints I think we have.


                             MRS. MARS:  What exact figure are we talking about?


                             MR. RISO:  4.3.
                3
                4            MRS. MARS:                  mon    in figures?
                5            DR. MAK LE                   9 of the 37 applications
                6 that were submitted and approved for funding.  Eight of them
                7 were disapproved at this point in time.
                8            So it would be among the 29 that the 4.3 million
                9 would be distributed.
              10             DR. MARGULIES:  We would probably illuminate the
              11  situation considerably by more discussion, but we do have some
              12  constraints on Warren Perry, who has to leave and he has a
                  bloc group on the education activities.
              13
              14             If you feel you are ready to take a vote on the
              15  motion, we can do so but we can continue the discussion.
                             DR. SCHREINER:  There is one philosophical thing and
              16
                  that'is-'whether," more is to be lost from leading somebody
              17
                  down the primrose path to nothingness or more is to be gained
              18
              19  of sponsoring Somebody to a salvage point.
              20             I haven't heard anything from the review subcommittee
              21  or from anybody to indicate how they feel about these.
              22             If you will look at these critically as a triage
              23  problem, what do you have to lose?
                             DR. KOMAROFF:  A significant triage was done at
              24
  \ce- Federal Reporters,  Inc. the lower level. It was reduced by 40 percent. Only the most
              25






                                                                                 1 82
    dw 10


                I  viable made the grade.
                2              Is that fair, Gordon?
                3              DR. MAK LEOD:  I think it certainly is fair.
                4              The other thing that might be said in that regard
                5  is that some of the  activities  going  on  in  parallel  would

                   be to assist these applicants to address themselves to the
                0
                7  obtaining of money from private sources so there will be activi-:y
                8  supplementing  Federal  support   money.
                9              MRS. MARS:  Did we include a one-year limitation in
               10  the   motion?
               11              Could we hear the motion again that was made?
               12              Did we include a one-year limitation of funding in

                   the   motion?
               13

                                                               ling to do that and I

                   ought                                       urance of   quality
               15

                   of care  plans,                                        inkage or
               16

                   not  must  be built into all  of  these.


                                                                       .1         he
               18                                        be since the gu d.  n6s
               19  subcommittee was given -- it says     on page 5, that the
               20  proposed  quality  care  assurance  must be a part of  each  of
                   these applications.
               2 1

                               We had assumed it was.
               22
               23              DR. DE BAKEY:  I am going to say I find it a little
               24@ difficult  to understand the basis  for  our  approval  of  the
 fkce- Federal  Reporters,  Inc. money.
               25@
                 1






                                                                              1 83
     dw 11

                1             We have a committee that is delegated the authority
                2  to participate in the review process, to determine the
                3  adequacy of the review and to be assured that there is going
                4  to be aquality control.
                5             Now, I haven't yet heard whether  or  not  in  their
                   opinion these grants will advance the  course  of  the  medical
                0

                7  program.
                8             This has been given to us ex  cathedra,  as  far  as
                9  I can  tell.
               10             I have yet to be convinced it can do that.
               11             You should be able to say the plans include
               12  evidence that the objectives and the intent of the legislation
                   for regional medical programs, for which this money was given,
               13
                   is going to be furthered by these plans and by the HMOs.
               14
               15             Up to there, I haven't been convinced of that.
               16             This is the whole point I am making.  You know, I
               17  expect ex cathedra, but not to the extent of voting these
               18  millions for this purpose.  I haven't been given that
               19  evidence.
               20             DR. CANNON: Let me say  that  you  can't  pass  that
               21  over to the subcommittee because we weren't asked whether or
               22  not this would advance the goals of the regional medical
               23  programs.
               24             our charge was the adequacy of the review process.
  @ce- Federal Reporters,  Inc. I was told by Harold a few minutes ago that the RMP staff,
               25





                                                                           184

    dw 12


                1  RMPS, was the ones that were doing the review.

                2             That is exactly what they did.  We came here and

                3  started about 9:30 or 10:00 and left at 1:00.  During that

                4 period of time, our first two hours were taken up in

                5 describing the review process and what they have been through,

                6 where they are from.

                7             At the last, there was a spot check of certain

                8 grant applications and these spot checks, with a discussion of

                9 certain points, such as the educational component in which we
              101 disapproved grants that didn't have the educational component
              11  clearly set forth as an example.
              12              My understanding, when I was called, rushed to come
              13  up here, and I did so at considerable inconvenience because-
              14  apparently no one else on the council would come, they

              15  told me I was about the last one.

              16              (Laughter.)
                              I am just kidding.  You can't pass that responsibility
              17
              18  on to a subcommittee, the decision you are asking.
              19              The question is whether or not they made it in the
              20  past or whether they never made it and should make it today.
                              I personally feel -- and I think we are down to beinil
              21
              22  personal -- my personal feeling is that I think the
              23  council should fund anything that has to do with the educations
              24  component that will maintain quality in any program that we are
  kce-Fedetal Repofters,  Inc. charged to be involved in but I don't think our funds should
              25






                                                                           1 85
    dw 13

                1 be used for other than that charge.
                2             I feel that that is our responsibility.  We are --
                3 concil is supposed to look from the viewpoint  and  maintain
                4 quality and transfer knowledge and all those things.
                5             DR. DE BAKEY: Are you ready to say to  the  tune
                6 of, what is it, four million or so, you are doing that in
                7 this program and should fund the program for  that  purpose?
                8             DR. CANNON: Would you say it in  the  michrophone
                9 so I might hear it?
              10              (Laughter.)
              11              DR. DE BAKEY: I thought you were a  lip  reader.
              12              I said are you prepared to say on the basis of
                  what you have seen so far that it is achieving that objective
              13
              14  to the tune of four million dollars?
              15              DR* CANNON:  No, but that is not what I was asked

                  to do.
              16
              17              DR. BCHSNER: The thing concerning me  most  about
              18  this is the fact Clark has already spoken about it.
              19              Apparently there are 38 percent of these people and
              20  we have no  assurance that they are going to have quality
              21  control. There might be every reason to  believe  they  might
              22  not.
              23              DR. MARGULIES:  Y ou might compare that with the res
              24  of the health care system.  At least in the HMO you have the
  @ce-Federat Reporteis,  Inc. opportunity to try to do something about it. It is a little
              25






                                                                               1 86

     dw 14



                 1  more difficult elsewhere.


                               I am more attracted to the idea of doing it in an


                 3 HMO.


                 4             Mike?


                 5             DR. BRENNAN:  My problem with this is that an

                 6 invalid process has been generated and there is only one prob-

                 7 lem.  Whereas we are now sure we have a process, but we don't

                 8 have it aimed at a target.

                 9             The problem for me in spending -- seeing that we

                10 should spend RMP funds here is that I don't yet to this day

                11 have any clear notion of what the content of that term HMO


                12 is.

                13                had  a council member who drew a cartoon for me of",-N

                1  an HMO  greeting  the dawn, which I would be happy to

                15 disseminate  at  some future time-

                16             He was  a humorist.  He had a sort of fantastic
                171 bird that looked like an extinct rock or something of that

                18 sort and I think that is what our real problem is.

                19             If somebody were talking about a clinic, detection

                20 program, an educational scheme, we would all have a pretty

                21 good idea in our minds of what the terminoloty meant, but

                22 we don't have,with respect to HMO, have that content.

     end 18     23


                24

  @ce -Federal Reporters,  Inc.
                2 5





     mea-- i
     CR 6499                                                                   187
     #19


                              DR. MARGULIES:  Russ?

                2             DR. ROTH:  One other thing I would like to get
                3 straight in my own mind, this committee has reviewed and I

                4 gathered from what Dr. Cannon has  said,  you  have  disapproved
                5 some grant applications, among those 114 that were approved --

                6 you haven't approved them all automatically?
                7             DR. CANNON:  We didn't go through it like that.  I

                8 tried to describe it.  The review process had already gone
                9 through and written approval or disapproval, but we spot-checked
               10 certain ones for certain features to see how the review process
               11 went about getting the information to make such a decision.
               12             In doing that we came up with  a  decisional  change
               13 on a couple of the applications.  That's in essence the service
               14 that this committee tendered.

                              DR. MAC LEOD: At the present time  the  --  we  have
               15
               16 funded during the first funding cycle which was in fiscal
               17 year 171, 39 grant applications.
               18             Again, the second funding cycle in December of '71,
               19 involved another 46 applications.  In  addition  to  that  there
               20 were 15 from SRS, six from SD's and four or five from generator
               21 type contracts, such things as the American Association of
               22 Medical Colleges, American Association of Medical Clinicians.
               23             These were all part of the 110 that were used for the
               24 funding cycle up until the present time.  When this particular
  Nce -Federal Reporters,  Inc. cycle was announced, invitations -- these 110 were asked if they
               25



    mea-2                                                                  1 88


                  wished to come in for continuation support.  Of this group, 37
                 1                                                      -
                 2asked for continuation support and 29 -- all 37 were  reviewed
                  and 29 were approved in the process that was Put before this
                 3
                 4composite group which I mentioned.
                 5           DR. BRENNAN:  I would like to call for the question
                  and then we can make another motion if we have to.  I think we
                         scussed this until we are blue in the face.
                                              As I understand it, the motion is
                  provide the grant funds for those HT-10's for planning and
                   develonTnent which have survived the revi.ew process with the
                 10
                   understanding this is for one year only and there will be
                 1
                   adeQuate input to maintain a good level ot quality of care in
                 2

                   the 11@10's.
                 3
                                    ose in favor, please raise vour hands.
                 14
                 15            (Show of hands.)
                 16            DR. MARGULIES:  Opposed?
                 17,           (Show of hands.)
                 18            DR. MARGULIES:  It carries.
                 19            I age greatly during these discussions.
                 20            if there is no further reason to discuss that motion,
                 21 I would like to get on --
                               DR. PERRY-  I think evervone needs a break.  I'll
                 22
                 23 take a later plane.
                 24            DR. MARGULIES:  That's kind of you.  I think a ten-.
  Ace-Federal Reporters,  Inc. minute break would be fine.
                 25






                                                                             189



                              (Recess.)

                              DR. MARGULIES:  Could we reconvene, please?

                              We had a request after the last vote, which I  think
                3
                  is highly  desirable, for a recording of the -- of those who
                4
                5 voted for, those who abstained and those who voted against.
                6 I do think we need that for the record.
                7             If I -- if we may, let's go around the table
                8 beginning with Mrs. Wyckoff.

                              MRS. WYCKOFF:  I voted for.
                9
               1 0            DR. NIARGULIES: Sewell Milliken, for.       V/
               I I            MRS.  MORGAN:  For.                         V/
               12             DR. nkRGULIES:For the recorder, give your  name if
                  you will and your vote.
               13
               14             MRS. MORGAN:    or.
               15             MR.  WATKINS:  For.
               16             MR. MEYER:  Against.
               17             DR. ROTII:  Against.
               18             DR. BRENNAN:  Against.

                              DR. MC PHEDRAN:  For.
               19
               20             DR. MERRILL:   For.

                              DR. CHASE:  For.
               21
               22             DR. KOMAROFF:  For.
                              DR. MILLIKAN:  Against.
               23
                              MR. HIROTO:  For.
               24
  @ce -Federal Reporters,  Inc. DR. SCHREINER: Against.
               25





           me a.- 4                                                                                                                                       190


                                 1                            MRS. CURRY:  I abstained but I would like to say
                                 2 , against if               I can change.
                                 3                            DR. MARGULIES:  You can't.
                                 4                            MRS. CURRY:  I abstained.
                                 5                            MRS. MARS:  Against.
                                 6                            DR. DE BAKEY:  Against.
                                 7                            DR. MARGULIES:  Cannon's vote was against,.
                                 8                            The    vote was nine to seven.
                                 9                            DR.    MC  PHEDPATQ:    TA7here  are  the  abstentions?
                              101                             DR.    MARGULIES: One and seven shown.
                              ill                             DR.    BRENNAN:    Mr.  Chairman,  I  think  it's
                              12       inappropriate               for a Council member to abstain on a vote to
                                       spend  $4  million.
                              13
                                                              DR.  MARGULIES:     It  may  be  but  that's  what  the  vote
                              14


                                       was.
                              15
                                                              DR.  BRENNAN:    Then  I  would  like  to  ask  for  anot  er
                              1 6

                                       vote.
                              17
                                   1                          DR.   DE  BAKEY:     I  think  you  can  move  parliamentarily;
                              18'
                              19       you  can  make  a  motion  about  the  vote.
                              20                              DR.  MARGULIES:    I  think  you may  do  it  if  you want,
                              21       Mike,  but  two  of  the  people  who  voted  are  no  longer  here.
      0                       22                              DR.  BRENNAN:    My  opinion  is  on  large  expenditures
                              23       like  this  everyone  ought  to  be  comfortable.
                              24                              DR.  MARGULIES:    Do  you  want  to make  a  motion@
    @ce - Federat Reportefs,  Inc.                            DR.  BRENNAN:                I  make  a  motion  to  the  effect  that  the
                              25






      ea-5                                                                   191


                1  Council vote without abstentions on this question.
                2             DR. PIARCIJLIES:  Is there a second?
                3             MRS. PIARS: Second.
                4             DR. DE BAKEY:  Could we discuss that.
                5             DR. 14ARGULIES:  I am a little lost parliamentarily.
                6             DR. DE BAKEY:  I am not sure that ought to make the
                7  final  decision about what we should do. I  think  what  is  much
                   more  important is a decision that the Council feels secure with,
                8
                9  for one  thing, and certainly is -- feels that in  the  sense  of
               10@ making the right decision.
                              I think it's important for us to recogniz6 that this
               12@ is a precedent-setting type of procedure we are engaged in here
                   and I really think that it really required more deliberation
               13
               14  and consideration than we have given it.
               15             There was a great deal of discussion in terms of
               16  the appropriateness and so on but, take, for  example,  you  see
               17  I feel very strongly personally that I am not really able to
               18  vote on this issue in a truly honest way in discharging my
               19  responsibility because I have never had presented to me the
               20  evidence that I think is needed. It may  be  available;  it  may

                   be available.
               21
   0           22             Secondly, I -- we have used the procedure delegating
               23  authority or delegating in a sense our responsibility and I am
               24  perfectly willing to do that and I know this is the proper
  \ce - Fede@at Reporters,  Inc. procedure and we have done it effectively on numerous
               25





     mea-6                                                                 19 2


                1 occasions.
                2            Now, here, instead of really delegating our
                3 responsibility, we have delegated in a sense another type of
                4 responsibility which was not related to the expenditure of the
                  funds. I am not reallv sure that the committee that  --  let's
                5
                6 say participated in this on the basis of our request was  able
                  in itself to determine whether the Council could be advised as
                7
                8 to the appropriateness of spending this money for this program.
                9@ They have provided no evidence to this extent at all.
              10@            This is'why I think it was quite inappropriate  for
                  us in a sense to vote at this point. I voted against it not

                  because I am against the program,because 1-don-'t     what the
              12
              13  program is, and I am asked to vote on -- to provide money  for
              14  a program that -- I iea-li@-a'l       the nature of in terms
                  of responsibilities, let's say, we have for the regional
              15
              16  program.
              17             As I said before, it's all very well and good for
              18  the administration, let's say, to determine ex cathedra it does
                  belong in this, but then in terms of the Council, the
              1 9
              20  appropriateness of the Council's decision-making, this is  not
              21  enough. It is certainly not enough for me to accept  that  and
   0          22  this is the reason I had to vote against it.
                             If I had the evidence before me or it was sent to
              23
              24  me in some way so I can be persuaded that it is, I would  vote
  %ce-Fede@at Repofters,  Inc. for it. This is why I think that it's a mistake.
              25




     me a- 7                                                                19 3


             I lof            DR. MARGULIES:  I certainly think the points  v  u
                                                                             0


                   have made in the sense of discorafort which the C
                2                                                   ouncil has in
                   taking action on something which has not been properly
                3
                   deliberated should be a prominent part of the record.  There  is
                4
                   no question about that and I think everyone is  assenting  to
                5

                   that.
                7             There was no sense of comfort on anybody's part
                8  in voting aye or nay on this.
                9             MRS. WYCKOFF:  This is the price you pay for
               10  accepting earmarked funds.
               11             DR. DE BAKEY:  They weren't earmarked.
               12             MRS. WYCKOFF:  I thought they were.  I thought the
                   16 million was earmarked.
               13
               14             DR. DE BAKEY:  That's a very important point.
               15             Congress earmarks money from time to time for
               16  specific purposes.  This money has never been earmarked except
               17  by the administration.  This is the point I am trying to make.
               18             MRS. WYCKOFF: I thought it was  earmarked  and  we
               19  were given the responsibility.
                              DR. MARGULIES: This is an administration decision
               20
                   on funds, not a congressional decision.
               21
               22             We have a motion which is to make the vote on this
                   subject one in which abstentions are not allowed.  We can vote
               23
                   on tnat it you would like.
               24
  \ce-Fedefal Reporters, Inc. DR. DE BAKEY: I would like to amend the motion.   And
               25





      mea-8
                                                                                       19 4



                        t is  I would like to amend the motion to move that we set



                      -acision  and         r4,qr   th@         have  some evidence provide@
                 3@
                 4    ach one  of us to      deliberate further this  matter and then bring

                      t:
                 5
                                  If you want,   set  another  meeting, quite    all right.

                 7    r make it   a mail vote.
                 8                DR.  BPENN@'i:  I  am  afraid,  Mike,  that  is   another
                 9    otion.  That's hardly an amendment.  If you can defeat mine,
                10    ou can make yours if you want.
                                  DR. DE BAKEY:  It's a substitute motion.

                                  DR. BRF,,NNA14:  That's a substitute motion.
                1 2

                                  DR. ROTH:  I'll second that.
                131
                14                DR. DE BAKEY:  The substitute motion?
                15                DR.  MARGULIES:  It's  been  moved   and   seconded   the
                16    ote be set aside and some other process be found for reaching
                171    conclusion.
                18                DR. MILLIKAN:  No.
                19                DR. DIAR(,ULIT@S:  There will either be another meeting
                20    )r a mail vote.
                21                DR. DE BAKEY:  The motion includes the need to
                      )rovide some material to each one of us relating to the IIMO's
                22
                23    -ind the program  and  how  in  a  sense  this  does  provide,  let's
                      -;ay, an advancement of the @-)rogram gi.ving us the opportunity
                24                                    1
 Ace-Federal Reporters,  Inc. --,o make the interpretation as well because it is our
                25




     mea-9
                                                                            19 5


                1  responsibility to vote the money. I want to be  in  a  position
                2@ to make this interpretation.
      0         3             I am really asking that this vote be set  aside  and
                4  delayed until we have this opportunity to do this,  whether  it
                5  be done by mail or whether you want to call a  special  meeting
                6  for this purpose is all right with me.
                7@            DR. MC PHEDRAN:  Not a special meeting.
                8             DR. MARGULIES:  I see no alternative to a special
                9  meeting.
               10@            DR. MC PHEDRAN:  I just think when so many people
               11  have views that coincide on so many features about this that
               12  we split almost evenly on voting oft this question, it must  be
               13  because we don't have good grasp. The only way we  can  get  at
               14  that is by going over the material, I would guess.  I think
               15  that -- I just never have seen the Council get'split like t is
               16  before.  It means that there is some real misunderstanding,
               17  real difficulty, and you probably ought to get at it by
               18  reviewing material.
               19             So, that's why I would support it although  I  voted
               20  the other side of the question.
      CR 6499
      End #19  21             (Discussion off the record.)
      0        22

               23


               24

  \ce- Federal Reporters,  Inc.
               25






                                                                              19 6


       CR-6499   I             DR. BRETTNAN: I would like to point out  that  it  is
        #20
        nb-1
                 2 my understanding that Social Security  funding  of  this  program

                 3 is currently under Congressional investigation.

                 4             Secondly, that I believe that if we have had a

                 5 motion or if it were possible for us to  have  voted  to  support

                 6 the educational, the quality control, the interinstitutional

                 7 and the prior relationship planning components which are our

                 8 responsibility that I would have felt better.  But I simply

                 9 cannot understand the present circumstances which the Congress

               10  is clearly in doubt about the  program,  where  previous  funding

               11  for it is currently under investigation, I  should  hate  to  see

               12  our program put in any ]eopardy by  attachment  to  the  spending

               13  of another four million something about which there is no

               14  Congressional unanimity particularly in view  of  the  fact  that

               15  one of the sections of our act calls upon us to  be  very  chary.

               16  about moving to radical changes in the health care system in

               17  this community.

               18              DR. MARGULIES:  If we are to change the motion which

               19  you presented, it will require the approval of the seconder of

               20  the motion which was -- Mrs. Mars.

               21              MRS. MARS:  Yes.  For the first m'otion.
   0           22              DR. MARGULIES:  That has your approval?

               23              MRS. MARS:  Yes.

               24              DR. MARGULIES: The motion is  changed  to  one  which

  Ace - Federa I Reporters,  Inc.
               25  sets aside  the previous vote and which asks for further

                  I




     follows    nb
     me a- 1
                                                                               197
     CR 6499
     #20
                 I  information to demonstrate the way  in which the grant funds
                 2  would contribute to the purposes of RMP and which calls for a
                 3  subsequent ballot on the same question either by mail or anothei@
                 4  meeting of the Council.
                 5             Any further discussion?
                               MR. HIROTO:  What kind of timing is required for the
                 0
                 7  continuity of the li!.IO program?
                 8             DR. MARGULIES:  We would have to take action on this
                 9  before the last ten days of this month.
               10              MR. HIROTO:  Could I say something off the record?
               11              (Discussion off the record.)
               12              DR. MARGULIES:  Fred, do you have any comments to
               13   make?
               14              MR. STONE:  To tell you frankly, I don't know
               15   whether anything 1 would have to say would help or not.  You
               16   obviously have a council here that is very  disturbed  on  the
               17   basis of certain information they feel they should have, that
               18   they do not have.
               19              This being true, it's inappropriate to expect the
               20   Council -- if this is true and I must accept it as true, it's
               21   inappropriate for the Council to take action under those
               22   conditions.
               23              On the other hand, the Council it seems  to  me  in
               24   its obvious effort to help the staff must upon the receipt of
  \ce-Federal Reporters, Inc. this information be prepared rapidly to accept  a  mail  vote.
               25





     mea-Z
                                                                             19 8


                              I think that the -- I know the staff has done all
                   that the staff could be expected to do.  These are matters whicl
                2
                3  have been discussed and actions have been taken at a very high
                4  level for which the staff is not responsible; neither is the
                5  Council.
                6             On the other nand, it's perfectly obvious that under
                7  the law that Council has certain responsibilities wnich the
                8  Council is attempting to discharge.
                9             I think the Council, feeling as it does, has a
               10  right --  aresponsibility to request the information it needs
               11  to come  to a decision.  It seems clear to me in listening to
               12  this as  an outsider, because as you all know, I havbn't been
               13  here very longi the Council is trying to find the basis on
               14  which to help the staff get out of this impasse.
               15             I accept this as -- I myself accept this without any
               16  mental reservations as an attempt on the part of the Council
               17  to find a legitimate way to be as helpful as possible in this
               18' matter.
               19             Now, is this a reasonable explanation of what the
                   Council  is trying to do?  As you know, I came in in the middle
               20
               21  of the discussion.  Does this seem right?
               22             DR. SCIIREINER:  I think that's a very, very concise
               23  and accurate summary.  People are bothered and none wants to
               24  pull corks and watch them for the sake of seeing the water --
  %ce- Federal Reporters, Inc. we are trying to get --
               25





     mea-3                                                                 199


                                   ONE:  I ho-pe I didn't add to your problems.

                              DR. IIARGIJLIES: I don't believe there is any  room.
               2
               3              (Laughter.)
                              DR. DE BAKEY:  Would it be better to try to have a
               4
                   meeting of the Council by the end of next week?
               5
               6              DR. PIARCULIES: Dr. De Bakey raised the question  of
                   whether it would be more practical to have a special meeting
               7
               8   by the end of next week.  It's awfully difficult to get this
               9   many people together.
               101            MRS. MARS: How quickly can you get material  out  to
                   us?
               12             DR. MARGULIES:  Very quickly, but the risk of having
                   a low attendance on such a critical issue frightens me.
               13
               14             DR. BRENNAN:  Mr. Chairman, is there any
               15  administrative method open to the Director of HSMHA  whereby  e
                   may within the allocations to HSMHA rebudg6t some of the
               16
                   funding on his authority?  In other words -- one of my problems
               17
                   were this is not wanting to identify at this point because  the
               18
                   thing seems to me to be so vague in outline and so loaded  with
               19
                   many complications that I can't clearly foresee at the  present
               20
                   time.
               21
               22             I'd rather not attach the Council to what is
                   essentially a rebudgeting authority.  If the administration
               23
                   were to do this, and explain itself to the Congress, in that
               24
  kcc@-Fede@at Repoitefs, Inc. regard, it wouldn't seem  to me to be quite as harmful as it
               25




     mea-4
                                                                            200


                   would be if we were asked to do it.
                2             DR. MARGULIES:  I think that's an interesting
                3  suggestion.  We should move on.
                4             1 think probably we should take a vote on the motion
                5  which I think you all understand now.  I think we will have a

                   show of hands.
                0
                                      e in favor of the motion, please raise your


                     d

                              (Show of hands.)

                              DR. MARGULIES:  Opposed?
               11             (No show of hands.)
                              DR. MARGULIES:  The vote on this is unanimous.

                              MR. WATKINS:  No.
               14             DR. MARGULIES:  Oh, I am sorry.  One negative.  The

                   rest for.
               15
               16             This means we will get to you material which will
                   attempt to relate the HIAO activity to RMP purposes so t at you
               17
                   Can take a vote on the material which was presented to you by
               18
               19  ballot and we will ask for a very quick response.
               20             Keep us informed of your movements so t at we can
               21  get in touch with you.
   0           22             DR. MERRILL:  Will you include specifically the
               23  working of that?
               24             DR. MARGULIES:  I doubt that we can get that.  Are
  @ce-Federa I Reporters,  Inc. there specifics beyond the RMP purposes which you feel need to
               25




     me a-- 5                                                               20 1


                1  be addressed?
                2@            DR. BRENNAN: In principle I would  like  to  suggest
                3  that the funding taken from RMP should be funding in  part  of
                4  activities which plan for the necessary educational and quality
                5  control components for inter-institutional arrangements on the
                6  part of the HMO's and for the definition of relationships
                7  between a -- the providers and the HMO's and the means by which
                8  those providers might negotiate with the IIMO's for the level of
                9  their orientation.
               10             DR. DE BAKEY: I think that's fine  except  for  one
               11  thing. That is that we then would have to  have  an  assessment
               12  so to speak of the amount of the HMO that would go  into  that.
               13             In otner words, we would have to have -- we are aske(L
               14  in a sense to expend $4 million or something of the total.  As
               15  1 understand it, it is the total amount for these H140  grants.
               16             DR. MARGULIES: I think it's impossible  for  us  to
               17  deal with anything other than the substance of the motion which
               18  is presented which is that following this review  process  the
               19  grant will or will not be made for the support of  the  HMO'S.
               20             Your question is what does this have to do with our
               21  RMP.  That's the question we will try to respond to.
   0           22             DR. DE BAKEY: I would like to do a little of the
               23  interpreting myself, Harold.  I don't want the interpretation
               24  given to me, handed to me.  I feel that I have enough knowledge
  @kce- Federal Reportets,  Inc. about, you know, the HMO criteria, having at least participated
               25





     mea-6                                                                    20 2


                 1 in authority to know something about the framework structurally
                 2 of regional medical programs.
  40             3            1 think I know the criteria of the characteristics of
                 4 the regional medical program.  TAThat I don't know and that's what
                 5 I want to interpret, are the criteria  and  characteristics  of
                   HNIO in relation to what I will interpret are  the  reaional
                 0
                 7 medical programs. I don't want you to  give  me  another  ex
                 8 cathedra opinion.  That's the point I am trying to make.
                 9            DR. ROTH:  That's sort of an impossible request.
               10  Lord knows which one of the laws if any of  the  present  bills
     CR 6499
     End 420   11  are going to be passed.
      #21      12             DR. PA-ARGULIES:  I think we can do it on the basis of
                   what is being funded by the IIMO service. That we  can  do  and
               1 3
               14  lay it out for you so you know what the  money is going to go

                   for.  That's what we will do.
               15
                 6            May we move on to the next agenda item?
               17             As a part of our other activities for supplementary
               18  grant awards, we did address the  potentiality  which  began
               19  earlier with the subject of area health education centers which
               20  as I told you this morning were ruled out for RMPS and move
               21  from there to corntnunity-based educational activities which are
               22  of a different character.
               23             In doing this, we have worked very closely with the
               24  Veterans Administration which has been interested in the same
  \ce - Federal Reporters,  Inc. activity and have identified with them in  the  review  process
               25






     mea-2                                                                 203


                   those hospitals which have been site-vi.sited by the VA and
                   which they feel are an appropriate point for their support.
               2
                             These have been identified in the review process
               3
                   for these educational activities which were carried out in a
               4
                   manner very similar to what we have described for the emergency
               5
                   medical systems.
               6
                             What we did, in order to make sure that  there  would
               7
                   be an appropriate review process, is feed back to the  regional
               8
                   medical programs a description of an activity which is more
               9
                   than anything else an enhancement and embellishment of what
               I 0
                   P-MP's have been doing in general. to bring together community
                   resources to improve education of health professionals and  the
               12
                   relationship of that education to the delivery of services.
               1 3
                             Because again we were uncertain of our  funding,  the
               14
                   amount of that or the restrictions placed on it, we have
               1 5
                   carefully separated this out from anything which appeared to be
               16
                   the area health education center as currently defined and as
               171
                 ! originally defined and we are talking about something else
               18
                   which is a program that will be apparent as Dr. Perry reviews
               1 9
                   what has been done.
               20
                              In order to carry out this activity, then, we did
               2 1
               22  set up A special review committee which met a week ago  Sunday;
                   again we had to act more hurriedly than we like.  It was not
               23
                   as dif f icult in this case as in many others because RMP's have
               24
  Ace - Federal Reporters,  Inc. been involved in this kind of activity almost from the very
               25





     me a - .3                                                                     20 4



                     beginning.
                 2               Nevertheless, it did rush events and in the future
   is            3   this will he part of the RP4P process unless we get into a
                 4   strange and bewildering committee.
                 5               Dr. Perry was the Chairman and he will summarize it
                 6   for you,    Miss Kerr from the same group; Dr. Hess from the S@IE
                 7   group and Miss Anderson and Mr. Hilton both from the Review
                 8   Committee; Mrs. Wyckoff attended representing the Council;
                 9   Mr. Ogden had intended to but was unable to and we had also
                10   Dr. Popna, formerly coorcLinator of the RMP and formerly a
                     member of this council.

                                 The Review Committee was headed bv  Veronica
                12
                13   Cronley on the part of the -- to prepare the materials and make
                14   them reviewable by this group.
                15               It is that review process and the results that Dr.
                16   Perry will report to you.
                                 DR. PERRY:  My flight isn't until 7:45.  I made the
                171
                     change.  I hope we will be done in a very short time.
                18
                                 Certainly the review process as those of us
                19
                20   experienced at Sun Valley felt -- that it was indeed probably
                     the best review in the three or four years that we have beer
                21
                22   a part of PMP that we have seen.
                23               As had been mentioned when looking at the emergency
                24   projects, the review from the staff and the assistance from the
  Ace-Federal Reporters,  Inc. staff was really exemplary as this assistance was given to us.
                25




     mea-4
                                                                             20 5



                              @,le in turn made them a most integral part of our
                2  process. As Harold has said, our projects  and  our  program  was
                   not something entirely new. 1.1a.ny of the proarams indeed  are
                3
                4  involved  -- many of the projects indeed are not new  and  have
                5  been the kinds of projects that RMP has known in the past.
                6             As Harold said, we were looking  at  supplements  in
                7  programs,looking at those projects that had  responded  in  the
                8  past in many ways to these kinds of educational programs.
                              All of us know that much of this had been stimulated
                9
               10  by the Carnegie Commission Report and  certainly  the  acceptance
               11  by the PI,4P's at Saint Louis of the coordinators of their  great
               12  interest in moving and looking at the  manpower  development  and
                   utilization in various ways.
               1 3
               14             Through a consortium that many of us know is in
               15  operation in our own regions and those of us who have been
                   looking at grants are familiar with, the providers, educational
               1 6
                   institutions, clinical institutions, and indeed  in  this  case
               17
                   quite a community input in relation to these is  looking  at  the
               18
                   goals to be achieved.
               19
                              Thus from the Saint Louis meeting in  January  to  a
               20
                   point where in a short span of five or six months we did have
               21
               22  before us a large number of grants from 17 -- I  am  sorry,  19
                   regions and over 75 projects had come in  immediately  on  this
               23
                   area of community-based programs.
               24
  Ace-Federal Reporters, Inc. I think many of them, if we look at what did happen,
               25




     mea- 5                                                                206

                   were greatly stimulated and indeed helped by the key concepts
               2   paper that is in your material.  That final oaper that came out
                   of the Saint T,ouis meeting became a very important principle
               3
               4   kind of thing. That was immediately built into many, many  of

                   the projects.
               5
               6             How was it possible to review such a number in  one
               7   day?  We started Saturday night with Harold and Dr. Paul and all
               8   the Review people that were there.  Many of us were not out at
               9   Sun Valley just for the trip.  It was P21P's third allied health
               10  conference and thus there were many coordinators and many peoplE
                 I
                   from the staff at that meeting at that time.
               12            The integrity of the review process in that period
               13  of time I feel is a most important kind of thing to respond to
               14  here.  If you  ook in your folder, the -- I think RMP has
               15  learned a great deal in the past few years:--- the review
               16  criteria, the ways in which this was put tooether for this
               17  project, with three or four pages of review criteria, with
               18  recommendations from staff on these pages.
               19             We had something to go at and look at together  in
               20  relation to this.  Plus people from the regions and such that
               21  were there with us.
   0           22             For every project, every program we were reviewing
               23  we had people who had indeed been in that region and could
               24  respond to direct questions that we had.
  Ace -Federal Reporters,  Inc. So, these guides and criteria for review certainly
               25





                                                                           20 7

      mea-6
                1  Dr. Ilinman, Dr. Conley, the staff did a fantastic job.  we all
                2  profited from it.
                3            As an active part of the processes, I mentioned we
                4  did indeed. include the staff up at the table with us, to get
                5  the totals here, and I want to refer to you four brief
                6  summaries to give you an idea of some of the kinds of projects
                7  we did look at here.  From your totals you can note a total
                8  requested amount of $10,229,811, was re quested in this total

                   amount.
                9
               10            The recommended figure for this amount by the
               11  Review Committee, and we do have a change here that Cars. Wyckofl
               12  who is quite an accountant found in relation to this.
                   Intermountain is a 42,080 amount which changes the totals at
               13
               14  the bottom to 882,060 and a grand total then  of 6,800 --
                   $6,874,996.
               15
               16            In relation to this program, what about the
                   disapprovals and the large number we did look at?  What was
               17
                   missing?  What were those areas that we considered were not at
               18
                   this period of time effective for funding?
               1 9
                              Certainly many and some of the programs -- I should
               20
                   not say many but some of the programs we were still looking at
               21
               22  a very traditional pattern of continuing education and trying
                   to fit it in still in a continuing plan.
               23
                              Although continuing education was an integral part
               24
  Ace-Federal Reporters,  Inc. of many of the programs, it was the only kind of program in
               25





        mea-7                                                              20 8


                1 some of them that had been put together.
                2            The community input, we looked at very carefully as
                3 we looked at the various groups that were a part of the
                4 consortium of the program that was involved here.  We were
                5 looking at the needs of all of the health professionals
                61 involved in this program and particularly the leadership role
                  of medicine as it related to some of the other health
                7
                8 professions in these areas.
                9            There were individual parts of a consortium missing.
              10  If there was community need in some cases, not the  hospital
              11  input or the educational institution input. We  looked  very
              12  carefully at those pieces and parts of the total process.
                             We were very encouraged however at the  excellent
              13
              14  applications that were among the review processes at the same

                  time.
              15
              16             Some of the consortia have already been in operation,
              171 have already developed their bylaws beyond the planning phases
                  ready to implement.
              18
                             These are the programs that were out there that
              19
                  have been a part of this kind of development during the past
              20
                  few years.
              21
              22             Let me read then just briefly, and I did ask  the
                  staff to give me a few summaries of some of the projects that
              23
                  have been approved so you can get a feel for the kinds of
              24
  Ace-FederalReportefs,lnc. consortia and since you do not have available to you the large
              25






                                                                             209
         arl

                1  stack that we had.
                2              Project number 110 from Los Angeles East.
                3  Their community-based manpower project proceeds from
                4  intensive work by the RMP in that area  in  the  medically
                5  deprived areas of East Los Angeles.  The LA East consortia

                   which has just been incorporated has a 25 member body
                0
                7  representing a consortia of 13  citizen  consumers,  three
                8  students, and three representatives each  from  the  health
                9  professions involved in it with representatives from health
               10  care facilities, health training and educational institutions
               11  in that area.
               12              The CBMP there would serve as  an  information
                   clearinghouse, will coordinate and look  at  all  existing
               1 3
               14  training programs and will serve as a catalyst for the
                   recruitment and training relative to  that  community  and
               15
               16  its health service needs.
               17              It also hopes to act as a fund raiser  for
               18  future activities of this kind.
               19              Also in California, number 107, which impressed
               20  certainly some of these I am reading are indeed the kinds
               21  of projects many of us have been looking for, at times
               22  as we look at those programs that "why discover the wheel."
               23              Some of these indeed have some  very  important
               24  kinds of things that have selected demonstration potential
  kce -Federal Reporters,  Inc. for other areas. This is great variety in the di  erent
               25






                                                                           2 10

         ar2

                I  kinds of projects we have, but some are so well put
                2  together we can profit by looking at these.
                3             San Fernando Valley, an already existing
                4  consortia in the San Fernando Valley will be expanded to  a
                5  CBMP extending to several surrounding counties.  The  first
                6  year will be devoted primarily to the refinement of  the
                7  administrative structure of the nonprofit coordinating
                8  governing body.  High level of interest and commitment of
                9  all relevant educational health care institutions as well
              10   as the health practitioners and consumers will enable  this
              11   new corporate body to serve as the primary vehicle for
              12   planning all health manpower training activities in their

              13   service area.
              14              Long-range plans call for the development  of
              15   long-range curricula in the California system.  The  plans,
              16   RMP community manpower project, is considered a most
              17   important model and certainly geared to that area.
              18              A careful data base aimed at ascertaining
              19   needs and establishing priorities has already been
              20   accumulated for this project. The program  is  conceived
              21   as a truly cooperative effort of the health care  resources
              22   and represents an integral arm of the RMP.
              23              The range of cooperation extends from the RMP
              24   to consumers, health planning groups, to the  university
  @ce-Federal Reporters,  Inc. and community colleges, professional societies, public
              25






                                                                                2 11
         ar3

                 I  schools, health care provider institutes, health care agencies,
                 2  and the Veterans Administration, which is indeed a part

                 3  of that project.
                 4              The ultimate goal of that program and the program
                 5  projects is that of meeting the  demands  and  need  for  health

                    care needs of the region, a range of operational activity
                 0
                 7  such as  university-community  coordination  of  health  care
                 8  programs, pediatric and nurse associate programs, evaluating
                 9  home health team training programs, cooperative inter-
               10   institutional in service educational program and so forth.
               11               Again, in this case,  financial  support  of  the
               12   program will come not only from the RMP, it will come from
               13   the VA, from participating institutions, the statel TB and
               14   Heart associations.
               15               Unlike some of the programs, a unique effort
               16   here is that they are at this very moment identifying sources
               17   of continued financial support following the period of
               18   both the RMP and VA federal funding.
               19               I could go on with South  Dakota,  with  some  of
                    the other projects we did review.  There were reallv some
               20
               21   very strong programs that have come out in this review process.
               22   One area that you do not have on  your  listing  there  is  a
               23   priority listing that has been done  in  addition  to  what  you
               24   have. You have the total  requested  and  you  have  a  total
  kce -Federal Reporters,  Inc. amount. We were informed that  in  all  likelihood,  as  Harold
               25





                                                                           212

       ar4

                1  mentioned this morning, the necessity of being unable  to
                2  fund everything, that it would be extremely important  to

                3  do a priority listing here.
                4             Evolved from that listing are nine regions, and
                5  I will be very happy to read these off to you as priorities
                6  in this listing, if you wish to take your own page here
                7  under number five and check these off, I can list for  you
                8  those that have been given priority attention by staff and
                9  by the committee.
              10              Alabama pro]ect number 45; California  project
              11   104, 107, 110, Lake Erie's T)roject 28 through G and J
              12   through N, Maine projects 27 through 37, New Jersey project
              13   30, Northeast Ohio, project 15, Northlands project 68
              14   through 74, South Dakota number 2 and Tristato number  19.
              15              This amount and figure at this point is
              16   $5,218,795 at this point.
              17              1 think you know for the future as we look  at
                   this kind of programming, as we look at this kind of planning,
              18
              19   as we look at the community-based projects heref there  is
              20   certainly great future as one looks at RMP, as a  part  of
              21   looking in a shared way at some of the new systems developed
              221  by the relationship of many of the health professions working
              23   together, of the accessibility of health care that is showing
              24   up in quite a few of the projects from the standpoint  of
  kce -Federal Reporters,  Inc. rural projects, projects in inner city and so forth. These
              25





                                                                                                                                                      2 13

                    arS

                                1      are all, I believe, very indicative of some strong, strong

                                2      input for the future.

             21                 3

                                4


                                5


                                6


                                7


                                8


                                9


                             10


                             11


                             12


                             13


                             14


                             15


                             16


                             17


                             18


                             19


                             20


                             21
      0                      22

                             23


                             24

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                                                                            2 14
        im 1


        #22
                1            If there is one area that we watched  carefully,  and

                2 one area that I believe,RMP must indeed strengthen in  every  way

                3 in relation to those projects and look at cautiously, and  t  at

                4 is the evaluation of out put of these projects for,  indeed,  if

                5 there are models here that are important, we must  evaluate  them

                o and have this to share with others because the projects,  as  we

                7 saw them are indeed some of the strongest we have seen  in  this

                8 area. For the accessability of health care, some  of  the  pro-

                9 jects in some of the more rural states as they are  looking  in
               10 @these areas, let's evaluate them, let's be certain that we  have
               11 la good record of evaluation on whether or not it is coming  out

               12 of these.

               13            The subcommittee was delighted to have Harold and

               14 Dr. Pahl with us throughout the entire meeting, and he is
               15 especially happy to have Mrs. Wyckoff sponsored on behalf of the

               16 council.  we were very pleased to have her with us.

               17            MRS. WYCKOFF:  Thank you.

               18            DR. MARGULIES:  Mrs. Wyckoff?

               19            MRS. WYCKOFF: This was a very  thrilling  meeting  in

               20 many ways. I had been on this council for  some  time.  I  never

               21 -- I want to compliment the staff on the  wonderful  preparation

               22 work they did in digging out the data that we  needed.  I  feel
               23 it is very important for us to get off the ground with  this  new

               24 community-based program with projects that are good  models  so

  @kce-Federal Repoiters,  Inc.
               25 we will have something to point to with pride here and be an

                 I





       JM 2                                                                 2 15



                  inspiration to the rest of the program.
               2@            1 would like to move approval of the report  of  Chair-
               3
                  man of the Review Committee and also to recommend  the  priority

               4
                  list that he gave in case we have to use it.

               5
                             DR. DE BAKEY:  I would second the motion, but  in  some

               0  way I think it is important that we express our sentiments --
               7@            DR. COMAROFF:  Can't hear you.
               8             DR. DE BAKEY: I think it is important  to  express  our

               9 sentiments. I think this is a very important  program,  and  it  is

               101true that it may take a while to assess the full 'impact, but  I
               11@have the feeling that as the -- as a programmatic  activity,  it
                 I
               12 can be extremely important in furthering the goals of the region--

               13 al medical program, and so I would urge, insofar as it is
               14 possible to do,so, that we avoid having to lean on the priority
               15 listinq, and that we give this total program a very  high  priori-

               16 ty.

               17            DR. MARGULIES: Okay. Dr. Chase,  would  you  like  to

               18 comment any from the V.A. point of view?

               19            DR. CHASE:  Yes.  This has been a very useful experi

               20 ence for us. On the many applications submitted  on  this  first
               21 go around, there were four from the hospitals we  identified  to
               22 provide initial support.  We -- from the applications, we iden-
               23 tified again some difficulties which we will have to address

               24 ourselves to.  Specifically, that in spite of the gu4,de lines

  @ce -Federal Reporters, Inc.
               25 which have been provided and meetings held in the field in






                                                                           2 16
       JM 3



                1 Washington with these coordinators and the V.A. Hospital direct-

                2 ors, we had some difficulty identifying the components  within

                3 the application which were reletive to the V.A., so among  those

                4 four, three of them we were able to provide on this first go

                5 around on the basis of only a small amount of money.  That @
                6 largely was in the realm of continuation of planning  activity;

                7 in other words, an annualization of funds which we had  already

                8 provided.

                9            Oh the other hand, the main application got the

              10  message pretty clearly, and we were able, on an  eighteen-month
              11  basis, to permit $317,000 of V.A. money to that application; the

              12  point being that now we will have to be back and work  closely

              13  with these sites to help them, if you will, in terms of  grants-

              14  manship, so we have the documentation to use our legislative

              15  authority.

              16             Counsel may be interested in knowing that  we,.too,
              17@are enthusiastic about this approach for the future, and  we  are
              18 again committing for the '74 budget year  another  three.million

              19 dollars for our contribution.

              20             DR. MARGULIES: I think this has been a  very  reward-

              21  ing working relationship between two usually quite separate
   0          22  agencies, and it is getting stronger as we go along.

              23             Any further comments?
              24             MR. HIROTO: Yes. I am a member of  this  East  L.A.

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              25  task consortium.  Should I excuse myself?

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                                                                          2 17
       JM 4



                1            DR. MARGULIES:  No.  By taking block action we are

                2avoiding the embarrassment of everyone but two leaving the room.

                3 We had to use those use those for illustration, but to get

                4 around that difficulty, we are asking for a block acceptance of

                5'a review process.
                6            For the'record, anyone who was involved with a

                7 region did leave the room during the review process.  Mrs.
                8Wyckoff was out during California, et cetera, et cetera.  That

                9part was kept unsullied

              10             MRS. WYCKOFF:  Can I make a motion?

              11             DR. MARGULIES:  You have made it, and it has been

              12 seconded.


              13             Further discussion?


              14             All in favor say aye.

              15             (Chorus of ayes.)

              16             DR. MARGULIES:  Opposed?


              17             (No answer.)

              18             DR. MARGULIES:  Thank you.

              19             We have to take one other collateral action.  Because

              20 of the action taken on the emergency medical systems which we

              21 feel is of high priority, we do need to get a motion from the

              22 council allowing us to readjust the level of commitment of the
              23 various regions so that they are appropriate to these actions.

              24 I would like to do that separate from another action on RMP

  @ce- Federal Reporters,  Inc.
              25 levels which raises a slightly different issue.

                 I





        im 5                                                               2 1 8


                I            DR. DE BAKEY:  So move.
                2@           DR. MARGULIES:  Is there a second?
                3            MR. HIROTO:  Second.
                4            DR. MARGULIES:  All in favor say aye.
                5            (Chorus of ayes.)
                6            DR. MARGULIES:  Opposed?
                7            (No answer.)

                8            DR. MARGULIES: We also have another action  on  chang-

                9 ing counsil action of approved medical programs, a list of  which
              10  we have available somewhere.  Partially, this is based upon the

                  obligation we have by Congressional action in this case to  main-
              12  tain pulmonary pediatric centers at A level of the previous
              13  year.  In order to do this, there are some regions which will

              14  need to have their commitment level evaded above where it is at

              15  the present time.

              16             There are also so many regions which are so close or

              17  right at the level of the coucil approval that they do not

              18  really have any turning-around room and cannot develop any new

              19  activities.  I will hand this list out to you, and while I am

              20  doing it I will read the --

              21             DR. DE BAKEY:  Would you clarify that just a bit?

              22             DR. MARGULIES: I will go back over  that.  First,  let

              23  me identify those in which there is a pediatric pulmonary  issue,

              24  and then we will look at the two in which other action has to  bE
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                                                                           219
       im 6



                1taken.
                2@          In Colorado, Wyoming, in metro D.C., in New Mexico
  16            3 region, and in South Carolina, if we are to support pulmonary
                4 pediatric centers and maintain our oevels of commitment at  1.7,
                51there will have to be, as you see listed before you, a new  annu-
                6 alized national advisory council level. Now, the other  two  have

                7 different justifications, and I would like either -- Bob do  you
                8 want to speak to this or Judy, the actions on Florida or

                9 Tennessee, mid-south, which propose an elevated level?

              10            DR. DE BAKEY: Let me ask one question in  this  regard.

              11 Congressional action was taken upon this.  Was it within the
   0          12 current budgetary --
              13            DR. MARGULIES: Yes, it was the action  of  the  Appro-

              14 priations Committee of the past year.  We are getting to it

              15 later than I would have liked, Mike, because Again we  could  not

              16 feel free to commit 1.7 without knowing we were going to  get  all

              17 the funds available. Now it appears we are close to  it,  and  we

              18 think we should.

              19            DR. CHAMPLISS: Specifically in the case  of  Florida  a

              20 request is being made of council to increase their level  in  the
              21 amount of $321,000 to take care of the fact that in  their  previ-
   @ie        22 ous application there was the amount of -- for $321,000  to  cover
              23 emergency medical service activities so this is an effort to
              24 provide -- they were ahead of the whole movement  here.  This  is
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              25 an effort to provide them with a restoration of the  amount  that

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                                                                             220
       JM 7



                 1they had already committed for that activity.
                 2            In the case of Tennessee/Mid-South, you will note
                 3that that they are right at the analyzed approved council level,
                 4and the additional funds in the amount of  $263,000  would  permit
                 5them to have expansion of their  ongoing  activities,and,  there-
                 6fore, request is being made to have that council  --  that  level
                 7 approved by this council.
                 8            DR. DE BAKEY:  Does that include pediatric pulmonary?

                 9            DR. MARGULIES:  No, it does not.

               10             DR. DE BAKEY: So they are really  talking  about  two

               11 actions?

               12
                              DR. MARGULIES: Yes. Well, if you  want  to  take  them

               13 together or if you want to separate them, you can.

               14             DR. DE BAKEY:  I just want to be clear.

               15             DR. MARGULIES: There are one, two,  three,  four  that

               16 involve pulmonary pediatric, and the others involve levels of
               17 RMP development which we feel is reasonable for  the  progress  of

               18 the   region.
               19             DR. CHAMPLISS: The 321,000 --  specifically  that  is

               20 to cover additional program activities that they  wanted  to  get

               21 underway.  I am not specifically aware -- Judy?
               22             MRS. SILSBY: This is a request to  raise  the  level.

               23 It is not a request to give them the funds.  All  of  these  funds

               24 are allocated, and it is a matter of going in  before  their  next
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               25 application comes in.  We would expect a full request to come in
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                                                                          221
       JM 8



                1to delineate what it is they want to do.  Some of the regions
                2got extended 15-16 months.
                3           DR. MARGULIES:  You see, when we extended the pro-
                4grams by several months, some of them were in a very uncomfort-
                5able position of wanting to initiate something new in the
                0extended period, but not knowing what kind of continuing support
                7they could plan on.  So we had to give a reasonable level of
                8assurance to keep things moving.  All this does is give us the
                9opportunity to respond to what is legitimate.  It is not
              10 necessarily going to be assiciated with further plant support.
              11            DR. SCHREINER:  My credibility is strained by being

              12
                 able to predict wiggle room to the closeness of 13 dollars.

              13


              14


              15


              16


              17


              18


              19


              20


              21
   10         22

              23


              24

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                                                                                222



   CR6499        1             DR. MARGULIES:  That's the left small toe.
   HEW #23
   Dennis        2             This is obviously based on what  they  think  they  can
   c;/r,/72
                 3  develop over A period of time and gives us an opportunity to
      1
                 4 respond or not depending upon the availability of funds.  You

                 5 see what will happen, if the action of the House holds up or

                 6 is higher than that, and we want  to  develop  programs  within  an

                 7 anticipated level of funding and they can't do anything for
                 8 nine months to a year, we are  strapped  again  into  the  mobility

                 9 of a program.

               10              DR. DE BAKEY:  That's why I was going on creditability,

               11  really.

               12              DR. MARGULIES:  They have not applied for it but

               13  they are anticipating doing so.

               14              DR. MILLIKAN: How do you  decide  who  isn't  going  to

               15  have this.

               16              DR. MARGULIES:  We have gone through a process of
               17  renegotiation of budget with all of  the  programs  that  have  had

               18  their fiscal year extended.

               19              This is a by-product thereof.
               20              DR. DE BAKEY:  I would like to move block approval

               21  of this.

               22              MRS. WYCKOFF:  Second.
               23              DR. MARGULIES:  Moved and seconded.  Any further

               24  discussion?

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               25              All in favor say aye.

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                                                                                   223


   jr 2           1              (Chorus of Ayes.)
                  2              DR. MARGULIES:  Opposed.
                  3              (No answer.)
                  4              DR. PAHL:  Mr. Komaroff?

                  5              DR. KOMAROFF:  I guess I don't understand.

                  6              It seems to me we are approving a supplement without
                  7 a request  for supplementary funds.
                  8              Were these just prorated on the basis of the approved
                  9 level?

                10               DR. MARGULIES:  No, they were not.  All of the
                11  regions which were extended were given 12 months funding only
                12  and they had to renegotiate their funding for the 15 or 16
                13  months, whatever is necessary and provide justification for

                14  that.

                15               In the process some of them were able to justify

                16  higher levels, same levels, or lower levels.  This is what

                17  finally came out of it.

                18               DR. KOMAROFF:  So in approving this supplement, they

                19  are not operating at a month three higher level?

                20               DR. MARGULIES:  They are still in the same range

                21  but this gives them a chance to do more.
   40           22               DR. PAHL:  Recognizing that it's somewhat late and

                23  we don I t have too much time to delve      into specific

                24  applications, we will have to take up at least two today becaus(-
  kce -Federal Reporters, Inc.
                25  the principal reviewers will not be here tomorrow.

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                                                                           224

   jr 3         1            So with your indulgence at the end of a somewhat
                2  lengthy afternoon of discussion, I would appreciate it if we
   is           3  could discuss the Northeast Ohio application.
                4            That is in the red covered ring binder and we have
                5  Dr. millikan as the principal reviewer.  Dr. Schreiner is the
                6  back up reviewer and Mr. Ashbee, staff and Mr. Milliken --
                7  the record will show Mr. Milliken has absented himself from

                8  the room.
                9            Before we have a d@iscussion.@f,,the appli-
              10   cation, I should like to say that you will notice, those of
              1 1  you who have been looking at staff materials and council books
              12   for some time will notice new color sheets and new formats
              13   and as Dr. Margulies indicated this is an attempt to have
              14   somewhat greater uniformity and reduction in paper work.
              15             The important thing for the council to know  is  that
              16   the blue sheets in each of these sections are the summaries  of
              17   the review committee's consideration relative to that  applica-

              181  tion.
              19             MRS. @IARS:  You said we were going to take up two.
              20   You just said Ohio.  Who was the second?
              21             DR. PAHL: Ohio itself. Northeast is first,  and  then
              22   O'nio will be the second application this afternoon.
              23             Mr. Baum has also asked me to indicate that  we  will
              24   be passing out for your consideration if you need them, the
  \ce- Federal Reporters,  Inc. computer print-outs, a compilation of all of these.
              25





                                                                                   225


   jr ;4         1              Those of you who  were  principal  or  back  up  reviewers
                 2@ did already  receive  the  print-outs  he  will  be  distributing.
                 3  These are just for reference sake at'the table.

                 4              While I am on that topic, Mr.              ?  who   is

                 5  chief of our office would appreciate any kind of -- Frank,

                 6  you should indicate they are not compelled to read these at

                 7  this point in time or you will have a rebellion.

                 8              lie would appreciate receiving comments from you as

                 9  was indicated by his  letter  relative  to  how  these  print-outs
                101 may be made more helpful in your consideration.
                11              We will be ready in  a  moment.  I  am  afraid  taking
                12  up the applications out of order.  We have caught Dr. Millikan

                13  somewhat unaware here and he  has  to  get  his  materials  in  order.

                14              DR. PAHL: Is  Dr.  Millikan  not  here?  We  got  too  far

                15  along.  We are not going to have him.

                16              I thought he was looking for his material.

                17              Dr. Schreiner, I think  the  ball  has  fallen  into  your

                18  court.  Would  you  please  discuss  Northeast  Ohio  application?

                19              DR. SCHREINER:  Is he not coming back?

                20              DR. PAHL:  It appears Dr. Millikan will not be

                21  returning.  It's just that our HMO discussion lasted longer

                22  than the plane departure time.

                23              We will turn  to  Dr.  Schreiner  comments  for  Northeast

                24  Ohio.

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                25              DR. SCHREINER:  I am afraid I can't give as much

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                                                                           226


   jr           1  detail as I would do if I were,primary reviewer.
                2            The Northeast Ohio region embraces about 12 counties
                3   in, as you might imagine from the name, the northeast portion
                4   of the state of Ohio and represents what is left over after
                5   the councils coalition efforts of the past year and centers
                6   primarily around Cleveland and the university contained thereinf
                7   Case Western University which has a medical and dental school
                8   and there are a number of nursing schools and allied health

                9   schools in the area.
              10              Principally rather heavy in medical technology and
              11    in radiation and so forth.  There are, for example, 60 schools
              12    of medical technology -- I thought in reviewing the materials

              13    that the review --
              14              DR. PAHL:  Would you use the microphone, please,
              15    so our recorder can hear you?
              16              DR. SCHREINER:  I thought that the site visit data
                    gave a pretty reasonable insight @into@ the operation in the
              171
              18    area and that one is really faced philosophically with two
              19    kinds of judgment and that is one could put a great deal of
              20    pressure on the group to join the Ohio area which I think most
              21    of the site visitors felt eventually should be the evolution
              22    of this particular RMP and that there are various ways of
              23    accomplishing that.
              24               One would be to disapprove it totally and wipe theff

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              25    out.






                                                                            22 7



   jr 6         1             The other,- would be to continue them for a year of
                2@ support and that attention be given to a new deputy coordinator.
                3             I am at a disadvantage not having been on a site

                4  visit.  Is anyone here who was on a site visit?

                5             MR. ASHBEE:  I was on the site visit.

                0             The report that Dr. Millikan gave at the last
                7  council -- was a copy of that in with the materials that you

                8  had --


                9             DR. SCHREINER:  No.
               10             MR. ASHBEE: Let me  read.  Pirst  is  recommendation

               11 I on Northeast Ohio.
               12             He said it appears the impact of Dr. Hudson's
               13  leadership or intimidation of some personnel in Northeast Ohio
               14  changing the position of the Northeast Ohio Regional Medical
               15  Program will be one of simply refusing to cooperate  or  relate
               16  to or combat any of the regional programs since  the  Northeast
               17  Ohio Regional Medical Program has a full time  coordinator.  it
               18  would appear wise to fund this program at its current level on
               19  a year to year basis, possibly having an in depth project site

               20  visit during the next few months.
               21             Under the present circumstances,, it is  recommended
               22  that a triangular review is not appropriate at this time.
               23             lie went on to say that activities to combine the
               24  northeast with Ohio State should be carried forward.

  kce -Federal Reporters,  Inc.
               25             DR4 SCHREINER:  My own superficial view was that

                 I






                                                                                     22 8


    jr 7          1  $600,000 is quite a bit for continuation of something that we
                  2@ are a little bit uncertain about, but I expect the site visitors
                  3  who were on the scene and I think about all you can say is that

                  4  you have a new program director, you have a RMP that hasn't

                  5  moved in the direction that the council would like to have it

                  6  move in, and essentially you are treading water and :what's

                  7  the price for treading water.  If everyone thinks that's a

                  8 reasonable price for treading@water,.I would be in favor of it.

                  9              DR. PAHL:  Mrs. Silsbee informed me that Dr. Millikax

                10   prior to his departure accepted and was in accord with t e
                11   recommendations of the review committee which would support the!
                12   your statement, Dr. Schreiner.  Would you care to make a motion

                13   or further@ comments?

                14               DR. MARGULIES:  Bob, do you want to comment

                15               DR. CHAMPLISS:  I think the council should know
                16   that this  is a region on very high priority for assistance.
                17   We reali2e the inherent problems there from a staff point of
                18   view and we have rescheduled our technical assistance and
                19   management assessment  visits to that region so as to take
                20   them out of phase.  We anticipate that the management assessment.

                21   team and the site visit will be made next month.
   40           22               We think this is a region that needs a great amount
                23   of help and that is Already being put on our schedule.
                24               DR. PAHL:  Dr. Schreiner, would you care to make a

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                25   motion?
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                                                                                   229


   jr 8           1             DR. SCIIREINER:  I move approval at the recommended
                  2 level.

                  3             MRS. MORGAN:  Second.

                  4             DR. MARGULIES:  Motion made and seconded to accept

                  5 the recommendations of the review committee.


                  6             Further discussion?


                  7


                  8


                  9


                10

                I II

                12


                1 3


                14


                15


                1 6


                17


                18


                1 9


                20


                21


                22


                23


                24

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                                                                                230


                               MRS. MARS:  What is the hope of merging it in the

     iiiiis @24
   5/5/72        2  very near future with the rest of Ohio? What prospects are therie?
                 3             DR. MARGULIES:  I think they are very vague at the

                 4  present time, Mrs. Mars.
                 5             The -- part of it depends upon the strength that
                 6  emerges from the Ohio merger which appears guardedly promising
                 7  but they are at the point now of trying to decide what they

                 8  really should be.
                 9             I think the existence of some outside people in
               10   Ohio like Dr. Cashman, who is the State Director of Health
               11   there,,is going to be a very useful force.
               12              They are talking with one another in much more regu-
               13   lar terms than they were in the past and we in turn are going
               14   to encourage them to talk together more in the future.
               15              I could not hold out any promise for anything more
               16   than an effort to move in this direction.  It's still very un-
               17   certain.  It's too bad, really, because the resources in C eve-
               18   land are tremendous for developing a good program.
               19              If they can get over some of the personality blocks,
               20   I think they may find that coming together will be good for
                    them in the long run.  I t I s s ti 1 1 very, very uncertain so f ar
               2 1
               22   as the total merger is concerned.
               23              DR. BRENNAN:  I think: in that regard our experience
               24   over the years has been that these programs are really grass
  @ce- Federal Reporters,  Inc. roots programs if they have any health to them at all, and we
               2 5






                                                                            2 31


   jr 2         1  every time we try to doctor them too much, bring them around to
                2@ what we think they ought to be before they have an idea of
                3  themselves, that we generally end up with a long period of dis-
                4  ruption and discouragement and no activity.
                5            If it's valid to have programs that are founded on
                6  those issues, I think you have to leave room for a great deal
                7  of patience with respect to how they are going to come along.
                8             It just seems that this thing has been going on so
                9  long in Ohio that we might have to say to ourselves, "Well,
              10   Ohio is peculiar and let it find its own way to the water
              11   fountain because we lave been trying to hold it up and make it
              12   drink and haven't been able to do so for a long time.11

              13              DR. PAHL:  Further discussion.
              14              MRS. WYCKOFF:  Maybe the community based education

              15   program there will have an effect.
              16              DR. PAHL:  The motion has been made to accept the

              17   review committee's findings.
              181             All in favor of the motion, please say aye.

              19               (Chorus of Ayes.)
              20              DR. PAHL:  Opposed.  (No answer4)
              21              DR. PAHL:  Motion carried.
              22               DR. PAHL:  Dr. Schreiner, we are going to have to
              23   call on you  to start the discussion on Ohio.  Mr. Jewell will
              24   be here as  our staff representative.
  kce-F@d@erai Reporters, Inc.
              25               DR. SCHREINER:  I think those of you who have not





                                                                             232


                   read the report will be interested in the sentence a site
   jr 3
                2 @visit was not performed.  A great many of us had difficulty
  41            3  in considering this application.
                4             That does not make my task easier.  This  has  to  do

                5  with support for the remainder of Ohio which depending whether
                6  you live in Cleveland or not is the merged or the unmerged

                7  portion.  It contains a number of proposals.

                8             First, let me address the areas in which  I  do  have

                9  some insight and that is the two renal transplant programs

               10  which were rejected and I think quite rightly so.

               11             The organ procurement effort does not have anything

               12  in the way of very specific -- for example, it says that a
               13  patient is placed in a waiting pool and tied up with various

               14  registries.

               15             You don't just do that with a piece of string.

               16  There is a specific way and it's very, very difficult actually

               17  to get plugged into the registry.
                 1
               18             There is no functional or national registry that

               19  actually needs the exchange of kidneys and some of the regional
               20  programs, the most formal one is in the  mid-Atlantic  area  and

               21  there are a few others that are informal arrangements.

               22             I think we have to have specifics so  we  know  where

               23  is the terminal and who runs the computer and how do the

               24  matches get made. Who calls up whom after  you  make  the  match

  ,ce- Federal Reporters,  Inc.
               25  and so forth.





                                                                                    23 3




   jr 4           1             This isn't something  you  do  by  committee  or  get  a
                  2@ letter in the mail three days later that they had a kidney last
                  3 week.


                  4             It has  to  be  something  operative  on  an  emergency

                  5 basis.  I think that the technical reviewers did a very appro-

                  6 priate job in that.
                  7@            The same thing is true of the proposal o  organs re-
                  8 cruited by  paramedical  personnel.  The  experts  in   this   field

                  9 are debating whether doctors should do it.

                10              A successful recruitment of organs has been in the

                11  areas where there is a committed transplant surgeon and where

                121 the surgeon himself is out harvesting kidneys.

                13              Dr. Koontz set  the  pace  on  this  in  San  Francisco

                14  where he harvests  all  the  kidneys  he  transplants  and  he  has

                15  the -- he is the  only  person  in  the  country  with  an  adequate

                16  supply.

                17              Right now  it  seems  to  be  funding  technicians  who
                18  will go around  to  hospitals  and  explain  to  people  that  their

                19  relatives' kidneys are going to be taken out, is shooting at the

                20  wrong level., I don't think it's going to be acceptable.

                21              I think that it has some very serious problems
  r*            22  associated with it, and I think for this reason the review
                23  group turned it down.
                24              So  essentially  what  they  are  recommending  is  that

     F(,dera I Repor  tefs,  Inc.
                25  the merger  be consumated in the real world and that about ten






                                                                           23 4



   jr 5         1  percent more than the previous com(bined funds be given and that

                2 a site visit.

                3            I don't have any other basis for -- any other recom-

                4 mendation than that so I would move approval of the review com-

                5 mittee's recommendati"


                6            DR. PAHL: Is there a second to  the  motion?


                7            MRS. MARS:  Second it.


                8            DR. MARGULIES:  Motion made and seconded.


                9            DR. HINMAN: I would like to make a  comment  about

              10  the third kidney project he recommended for disapproval.

              11             There were three kidney projects and the local re-

              12  views did not support them because of the fact that  --
              13  Dr. Schreiner commented on the first one. The third  one  had

              1 4 to -- had to do with a pediatric necrology setup

              15  it had local turnout and was supported by --

              16             DR. SCHREINER:  I was lumping the two with the gen-

              17  eral Ohio program.

              18             DR. PAHL: Could you speak up a  little  bit?

              19             DR. HINMAN:  This will change the funding level you

              20  were recommending.  There was a $900,000 recommendation for

              21  program staff which is unchanged and a $500,000 recommendation

              22  for operational activities if the kidney was  approved.

              23             Since the kidney was disapproved this reduces  it,

              24  rounding it off to $300,000 for the 01 year, $315,000

  kce -Federal Reporters, Inc.
              25  02 year.






                                                                                   235


   ir 6           1             DR. PAHL:  Further discussion on the Ohio application?

                  2             All in favor of the motion, say aye.

                  3             (Chorus of Ayes.)

                  4             DR. PAHL:  Opposed.

                  5             (No answers.)


                  0             DR. PAHL:  Motion carried.


                  7             DR. MARGULIES:  This seems to be enough to have

                  8 accomplished for the day.

                  9             We will adjourn until tomorrow morning, although

                10  Ken Baum has an announcementto make regarding the activities

                11  in between.


                12              (Discussion off the record.)

  Lnd 24        13              (Whereupon, at 5 p.m., the meeting was adjourned.)

   End 24       14
   CR6499
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  kce-Federal Reporters,  Inc.
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