The Department of Health and Human Services (HHS) spends about $1 billion a year on programs for improving access to health care for areas with shortages of primary care physicians and health care services. Many of these programs depend heavily upon systems to identify and designate specific areas and populations that are underserved. HHS has two such systems: The Health Professional Shortage Area (HPSA) system identifies underservice caused by a shortage of health professionals, and the Medically Underserved Area (MUA) system more broadly identifies areas and populations not receiving adequate health services for any reason, including provider shortages. About 88 percent of all U.S. counties contain HPSAs, MUAs, or both (see fig. 1.1). A primary care HPSA is an area designated by HHS as having a critical shortage of primary health care providers. These include areas with no providers or areas with an insufficient number of providers to serve the population living there. Designation as a HPSA is generally based on the following: the specified geographic area must be rational for the delivery of health services;the area must have a population-to-provider ratio of at least 3,500 to 1 (or 3,000 to 1 under certain circumstances); and adjoining areas must have provider resources that are overused, more than 30 minutes travel time away, or otherwise inaccessible. In 1994, there were 2,538 primary care HPSAs reporting a need for 5,133.8 full-time-equivalent physicians. About 45 million people reside in these HPSAs. HHS designates primary care HPSAs in one of three ways: a general shortage of providers within a geographic area, such as an entire county or group of census tracts; a shortage of providers willing to treat a specific population group (such as poor people or migrant farmworkers) within a defined area; or a shortage of providers for a public or nonprofit facility such as a prison or hospital. As shown in figure 1.2, most primary care HPSAs are geographically designated. Of the geographic HPSAs, 845 comprised an entire county and 1,107 comprised other types of self-defined geographic service areas. An MUA is an area designated by HHS as having a shortage of health care services. One major difference between an MUA and a HPSA is that underservice in a HPSA is measured primarily as a shortage of health care providers, while underservice in MUAs is measured using other factors as well. Qualification as an MUA is based on four factors of health service need: primary care physician-to-population ratio, infant mortality rate, percentage of the population with incomes below the poverty level, and percentage of the population aged 65 and older. As of June 1995, 1,455 U.S. counties were designated in their entirety as MUAs, and an additional 1,037 counties had at least 1 MUA designated within them. According to HHS officials operating the system, there were about 3,100 MUAs in all. Like HPSAs, MUAs can be designated for all people within a geographic area or can be limited to a particular group of underserved people within the area. Most MUAs have been designated for geographic areas rather than population groups (exact figures are not available). Unlike the HPSA system, however, the MUA system does not allow individual facilities to be designated as underserved. The current HPSA system was developed in 1978 as a means to designate areas for placement of National Health Service Corps (NHSC) providers. NHSC awards students scholarships or loan repayment for medical education and training in exchange for service in areas with critical physician shortages. The types of primary care health professionals that could participate in the program included physicians, nurse practitioners, physician assistants, and certified nurse-midwives. In 1994, NHSC reported having 1,147 physicians and 482 physician assistants, nurse practitioners, and nurse-midwives working in HPSAs. Besides NHSC, two other programs now require that a location be designated as a HPSA to be eligible for participation. Like NHSC, the Community Scholarship Program addresses provider shortages by awarding grants to HPSAs for local scholarships in the health professions. The Medicare Incentive Payment program attempts to ensure that physicians treat Medicare patients by paying a 10-percent bonus on all Medicare billings generated from a practice located in a geographic HPSA. The MUA system was developed about the same time as the HPSA system but independently of it. Authorized by the Health Maintenance Organization Act of 1973, the MUA designation has been applied primarily in identifying areas eligible to participate in the Community Health Center program. This program awards grants for the operation of community health centers and migrant health centers in qualifying areas. In fiscal year 1994, HHS provided support for about 627 grantees providing services at more than 1,600 sites. Centers that serve a designated MUA area or population also are eligible for cost-based reimbursement under the Medicare and Medicaid programs. Another 100 health centers (the so-called “look-alikes”) meet all requirements of the Community Health Center program and receive Medicare and Medicaid cost-based reimbursement, but do not receive Community Health Center grant support. Nearly 30 other programs use the HPSA or MUA systems to some degree, though none rely on a HPSA or MUA designation alone to decide who can apply for federal assistance. For example, nonphysician providers may qualify for cost-based reimbursement under the Rural Health Clinic program if they are located in a state-defined underserved area, HPSA, or MUA. The remainder of programs in this category are health professions education and training programs. Programs under titles VII and VIII of the Public Health Service Act give funding preference to schools that place graduates in medically underserved communities. Other programs, using various designations of underservice, award scholarships or grants for obligated service or training. Together, the various programs that use the HPSA and MUA systems accounted for more than $1 billion in funding and expenditures in fiscal year 1994. Table 1.1 summarizes the various programs and their funding levels. Any person, agency, or community group may request designation of an area, population group, or facility as a HPSA. Copies of each new request are received and reviewed by the Bureau of Primary Health Care’s Division of Shortage Designation (DSD). State representatives from the health department, medical society, and the governor’s office are also asked to review and comment within 30 days. DSD staff then check the application data against national and state sources. They also resolve conflicts among applicants, commenters, and data sources to the extent possible. HHS must by law review annually each designated HPSA to decide if it is still experiencing a shortage of health care providers. DSD does this by giving a list of HPSAs to each state and asking the state to update the information. In addition, Bureau policy requires HPSAs to provide data to DSD every 3 years to support their continued need for the designation. HPSAs not providing these updates are to be proposed for dedesignation in the Federal Register. MUAs are designated on a much different basis. The Department of Health, Education, and Welfare designated the original lists in 1975 and 1976 by applying the four criteria (population-to-physician ratio, infant mortality rate, poverty rate, and percentage of population that is elderly) to all U.S. counties, minor civil divisions, and census tracts. All areas that ranked below the county median combined score for the four criteria were designated as MUAs. MUA designations have been added since then on the basis of newer data and the same cutoff score. Since 1986, HHS has also been able to designate new MUAs under an exception process if requested to do so by a state’s governor on the basis of unusual local conditions. MUAs also differ from HPSAs in that there is no requirement to update the designations regularly. HHS officials managing the MUA and HPSA systems told us that DSD no longer reviews the list of MUAs to decide whether any should be dedesignated. HHS has an effort under way to combine and revise the HPSA and MUA systems. According to HHS officials, this action is being taken to reduce redundancies and differences in the application and administrative processes of the two systems. While HHS officials told us that no changes would be made before 1996, a draft working document says that HHS’ goal is to replace the existing systems with one that is consistent for all primary care programs, has simpler data-gathering requirements, uses relevant indicators of need, and will not disrupt services in existing areas. We reviewed the HPSA system as part of the broad federal effort to improve access to care, and as a follow-up to a congressionally mandated review of the role of federal health education and training programs in achieving this purpose. While separate HPSA systems identify and track provider shortages for primary care, dental care, and mental health care, our review of the HPSA system focused on primary care HPSAs. We chose this focus because the HPSA primary care system is by far the most heavily used for identifying areas eligible for federal funds. We included the MUA system in our review because of current HHS efforts to combine it with the HPSA system.