B&B ImFoRmAkriom ImAmE M^m^=EmENT 300 @ow4ce n--*=iVn R=uLxv Upoosca M,%nLmomc2, MA Pro ZC'77Z 0 U MA 11 CXC 1) 2410-01 1 0 STENOGRAPHIC TRANSCRIPT DEPARTMENT OF HEALTH$ EDUCATION$ AliD WELFARE MEETING ON AIREAWIDI PLANNING S:Llver Spring' Maryl 8 Ju:Ly 196 3 -ACE. FEDERAL REPORTERS, INC. @O a I Reporters ffici K4; W Constitution Aven6 I!L D' .'Washington C. Telephone: 393@01 1 Craft/Renzi 1 DEPARTMENT OF HEALTH, EDUCATION, AND WEIYARE 2 - - - 3 MEETING ON AREAWIDE PLANNING 4 5 6 7 8 Room 921, 9 7915 Eastern Avenue Silver Spring, Maryland ,lo Monday, July 8, 1963 The meeting convened at 9:20 o'clock a.m., Dr. 12 Jack Haldeman presiding. 13 FR 14 15 16 17 18 19 20 21 22 23 24 25 ACE-FEDERAL REPORTERS, INC. 261 CO,'4STITUTION AvE N.W WAIHINGT ON 0 C. 2 I N D E X 2 Agenda item P@e 1 3 Discussion on implementation - Dr. C. Rufus Rorem 8 4 Discussion on implementation in Southern New York Mr. Joseph Peters . . . . . . . . . . . . . . . ... 48 5 6 7 8 9 10 1 1 12 13 FR 14 15 16 17 18 19 20 21 22 23 24 25 ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N,W. W ASKINGTON. D. C. 3 P R 0 C E E D I N G S - - - - - - - - - - 2 DR. HALDEMAN: I wonder if we could get on with our 3 hog killing. I guess everybody is here except somebody from 4 Blue Cross. McErner told me either he would be here or someone 5 from his office would be here. 6 I don't know whether we need any introductions. I t 1 7 think we might go around and just rapidly call off. -auctions were made.) 8 (Intro 9 I think the purpose of this is probably three-fold. 10 The first purpose, I think, is to get a discussion 11 of methods of implementation of areawide planning. George 12 and I argued over this term "implementation" throughout the 13 deliberations on the so-called Bugbee Committee,, and I don't FR 14 think we ever found, really, a better word. 15 MR. BUGBEE: The argument was on the semantics, an 16 idiosyncrasy of mine. I don't like the word "implementation",, 17 but I have given up. 18, DR. HALDEMAN: In the Bugbee Committee there was a 19 lot of difference of opinion,, and the report as it came out 20 contains very little in terms of specifics in terms of various 21 methods that might be used for implementing areawide planning. 22 Part of it was deliberate, I think, because we didn't. 23 feel we were wise enough to make recommendations in a document 24 such as this that would be applicable universally. 25 And secondly, I think there might be some real ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUT'ON AVE., N.W. W4."N.TQI, 0. (;. 4 I minority opinions if we had taken one side or another. There 2 were those on the committee that felt very strongly that there 3 should be franchising or the equivalent. There were others 4 that felt equally strongly in the opposite direction. And I 5 think both the Public Health Service and the American Hospital 6 Association that were sponsoring the committee had not taken 7 any particular position in regard to this. 8 It se@ to me like the time has come for setting 9 down and at least discussing various methods that are being usad 10 throughout the country to implement areawide planning, what ha3 11 worked, what hasn't worked, and get a general discussion of th-@ 12 subject. 13 I myself have mixed feelings on this subject because FR 14 it seems to me like it is an essentially negative approach and 15 a lot of our hospital planning agencies, a great deal of their 16 time is taken up in stopping construction of one kind or 17 another. 18 It seems to me like in the course of our discussions, 19 we might want to discuss what are some of the positive element4 20 in planning. I was right impressed with the recent article by 21 Bob Sigmond of Detroit in which he took off in depth on the 22 positive elements of planning. 23 The second general sub ect is one of priorities. 24 I would like to make an assumption in this part of the discussion 25 that the areawide planning agency is responsible for the ACE-FEDERAL REPORTERS. INC. 261 CO"STITUTION AvF N W. 5 I distribution of capital construction funds, whether they be 2 Hill-Burton or a modernization program,, Federal funds, or 3 whether they be capital construction funds raised in the 4 community such as in Columbus. I think this problem of priority is one which in the 5 6 future years the Hill-Burton program is going to be faced with muc 1 7 more than they are now because the current priority system under 8 Hill-Burton which is largely a matter of relative need is 9 fairly simple, end it works relatively well in rural areas, 10 but when you get into a metropolitan area, it obviously breaks down. 11 12 And if we get a modernization program, every State 13 Hill-Burton agency and every local areawide planning agency FR 14 is going to have a problem of priority, not only in the general 15 hospital category, but among categories. And so I would hope 16 that we would take a hypothetical situation, perhapsI, in a 17 community and see what we can develop in the way of priority 18 principles. 19 I have always felt that if we get a modernization 20 program -- Well, first, our specifications for a modernization 21 program do require the areawide planning agency be consulted, 22 but secondly, will not spell but in any detail priority principles, leaving that to the State Hill-Burton agency as well as local 23 24 Rill-Burton agencies. 25 I thought probably that the process would be locally ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTION AVE N W 6 I a good deal like an NIH study section would be, pooled profes- 2 sional judgment based against certain general guidelines which 3 are developed. 4 Now,, the third thing I would like for us to take up 5 is whether it would be desirable to have what might amount to 6 a national meeting of personnel of local areawide planning 1 7 agencies. The American Hospital Association, Hi Sibley, and 8 Public Health Service have just completed a series of seven 9 regional meetings which were intended originally to be sort of 10 a field testing-for a cookbook that we had developed, based 11 largely on these committee reports, but going into more detail 12 some detail as to the data needed for planning, the analysis 13 of the data and what not. FR 14 I don't think any of these meetings really served 15 that purpose. And the reason it didn't serve the purpose was 16 that the groups that participatd were, not only people from 17 areawide planning agencies, but were a lot of people that were 18 broadly interested. And they served a useful purpose, I think, 19 in that it stimulated interest in areawide planning. 20 As I was saying, I think those sessions served a very 21 useful purpose, but it was not as useful in terms of people in 22 areawide planning agencies who are actually doing the work in areawide planning agencies, having an opportunity to get down 23 24 discuss more or less detailed questions and to discuss the' 25 gs that the staffs of areawide planning agencies are ACE-FEDERAL REPORTERS, INC. 2 6 1 CONST'TUTION AVE N W, W-@'llcl,ol L2@ C, 7 interested in. 2 So we wondered if there wasn't a need for a meeting 3 that would be pretty well confined to the individuals in 4 working an the staff areawide planning agencies and, if so, how should such a meeting be structured, when it should be 5 and what not. And I would like to take some time in this 6 7 area. 8 As far-as I am concerned,, the meeting these two days 9 is quite unstructured, and if you want to take off and consider 10 other things, that is quite appropriate. I am not quite sure what we will do with the proceedings, but we are having them 11 taken down so that we can develop some sort of a report if it 12 l@3 appears that many pearls of wisdom are being dropped. FR 14 George, do you want to discuss this from the standpoint 15 of the background as chairman of the Committee on Areawide 16 Planning? 17 MR. BUGBEE: I think you have covered it very well, 18 Jack. I think we are all conscious of some worry about how 19 far you go with legal sanctions, but I don't know that anybody 20 feels terribly strongly. 21 It is kind of an academic argument and probably not 22 the most important method of-implementation anyway. 23 So I suppose you go through the whole range. Even in 24 the informal conversation of last evening,, it seems to me people 25 are developing quite a little experience in how to put these ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W. W.,@"G,oI0. C, 8 1 things in motion. 2 I like your idea of positive as well as negative, too. 3 DR. HALDEMAN: I think when we talk about implementation 4 we might try to bring in this element of positive action. 5 Suppose I just go around the table and comment what you are- 6 doing in this area and what you would like to do, what has 7 worked and what has seemed not to work. 8 Rufus, do you want to lead off? 9 DR. ROREM: Yes, I would be glad to be first to 10 speak because I-am going to be the first to leave. I have a 11 9:00 o'clock plane tonight so I wonft be here tomorrow. 12 Well, I think that we like to characterize our effori:s 13 as primarily being interested in stimulation of individual FR 14 hospitals to do planning on their own account and then stress 15 in that the fact that the self-interest of an individual 16 hospital means that they must be familiar with and aware of 17 what the other institutions are doing. And we have urged 18 every hospital to appoint a long-range planning committee for is its own institution, composed of representatives of the manage- 20 ment, of the trustees, and of the attending staff and, if they 21 wish to cooperate, community members -- it is all to the good -- 22 as well. 23 Conversely, we work with community groups particularly 24 in areas where there is no hospital to study the characteristics 25 of their own area to see whether and what kind of a health ACE-FEDERAL REPORTERS INC. 261 CONSTITUTION AVE N.W. wAstieNGTON o@ C. 9 I facility may be needed. 2 Now, one of the things that you will have to take 3 away with you is our work document or guide for the use of 4 long-range planning committees of individual hospitals. And 5 in this, there is a tabulation of the results of our resident 6 survey applicable to the year 1960 which shows in tabulations 7 of 29 districts where the people of that area with hospitals 8 go as inpatients7of each of the 29 districts. 9 In other words, when a person wants to say: Where lo do the people who live around me go? -- the tabulation shows 11 where each of the 29 districts that are classified here were 12 hospitalized and, conversely, the planning committee of a 13 hospital can see where its patients come from. FR 14 We will find, for example, that they might get 40 15 per cent of their patients or some other figure from a particular 16 geographic area. Yet, they may only serve 10 per cent of the 17 people from that geographic area. 18 Our idea is that this would serve as the basis for the 19 hospital to plan ahead and as to what areas it wants to be more 2o active in, the areas where it will encounter already entrenched 21 position on the part of other institutions. 22 This is strictly superficial. It does not devise 23 the services in terms of medical, obstetrics, pediatrics, and 24 in this particular guide does not deal with outpatient service 25 or nursing homes or many of the other important facts. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTICON AVE., N.W 10 I I mention this as a method because we use this as 2 a backdrop for appraisal of any projects for expansion or for 3 new institutions strictly as a guide and as a backdrop and 4 try to keep this interest going. 5 I might say that all of our general hospitals have 6 now established long-range planning committees and four of our 7 eight nongeneral hospitals, nursing homes, and things of that- 8 kind and rehabilitation centers and home& for crippled childrea, 9 have also done so. 10 Just as far as implementation is concerned we use no implementation except that of persuasion and the announcement 12 of an official position which our organization takes after 13 going through a series of hearings which we call nonlegal FR hearings. 14 15 If a hospital has a program on which they would like 16 to have our opinion, it,goes through four steps. They first 17 have a conference I call a conference of the hospitals most 18 likely to be affected. 19 Now, after three and one-half year4,, those are very 20 lively discussions and the insttitutions now are getting so 21 their representatives -- these are administrators -- speak up 22 frankly in their own self-interest which for a while they were 23 very self-conscious. It was a log-rolling affair. 24 Then, it is brought formally between a committee of the 25 administration and hospitals involved. The institutions are ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N,W, WIIIIIIIIA, D. C@ 11 I always there, and that second group actually take a vote as to 2 whether they think it is a good idea. 3 DR. HALDEMAN: What is the difference between the 4 composition of the two groups? 5 DR. RCREM: The first group is the hospitals most 6 likely to be affected, which means those are probably contiguous 7 areas. The second is a representative group of all the 8 hospitals in th6'area elected by them --'seven people. Then, 9 that recommendation goes to all the hospitals in the area. 10 Euphemistically, I guess I would say that every 11 hospital administration is a member of an advisory committee tD 12 us whether he likes it or not. He just is. And that group 13 hear a statement description of it, and they take a vote. FR .14 MR. BUGBEE: In a meeting? 15 DR. ROREM: In a meeting. 16 DR. HALDEMAN: Open meeting? 17 DR. ROREM: Open meeting. And they take open votes 18 up to now. We are talking about making it private, but it 19 isn't now. 20 MR. SIBLEY: How often do you meet? 21 DR. ROREM: About twice. We meet in between times tD 22 hear committee -- 23 MR. SIBLEY: This group meets twice a year? 24 DR. ROREM: We have met twice this year because of 25 special things that have come up. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE:., N W, a C. 12 1 DR. KLICKA: May I interrupt you? 2 Is this meeting structured in such a way that you or 3 your organization makes its recommendations on the basis of your 4 guidelines to this group? 5 DR. ROREM: That's right.. 6 DR. KLICKA: Before they start their discussion? 7 DR. ROREM: Not at these points. 8 DR. KLICKA: What do they base their consideration 9 on? 10 DR. ROREM: Well, on the merits of the case. 11 DR. KLICKA: This is what I mean. Who presents 12 the merits of the case in a so-called scientific way? Do you 13 do this or do you permit the hospital that wants to do something FR 14 to present its case alone? 15 DR. ROREM: The hospital is present. The hospital 16 really takes over and questions are asked in terms of the 17 standards. 18 DR. KLICKA: But you don't evaluate this first for 19 the group on the basis of your studies as to whether you think 20 this is good or bad. 21 DR. ROREM: In the sense of in writing? 22 DR. KLICKA: No, it wouldn't make any difference, but 23 it would seem to me that the group who were to be affected 24 would first like to have the opinion of the Planning Committee 25 relevant to how this would fit in the scheme of things. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W 7. C. 13 DR. ROREM: By the time it gets there, they know 2 how or staff understands. 3 DR. KLICKA: How do you do this? 4 DR. ROREM: The first meeting, I introduce. The 5 first meeting is really a go-around, just a general talk. 6 The second meeting, by that time, I have an opinion which I give 7 a tentative -- no, it doesn't crystallize until after the thirl 8 meeting. Then, It crystallizes definitely. And it still is 9 a wandering discussion the first three times around. 10 DR. HALDEMAN: What is the third one? 11 DR. ROREM: Then, the third one is with the entire 12 group of hospital administrators. 13 And then, the fourth is with the Planning Committee FR 14 of our Board of Directors. 15 MR. BUGBEE: But each of the three groups has an 16 official vote they pass On to the next one for examination. 17 DR. ROREM: The very first one has no vote at all, 18 but the representative committee, the advisory committee as 19 a whole., and the Planning Committee, and it goes to the Board 20 with a specific recommendation that is very short. And as it 21 goes along, I make summaries of these which are acceptable 22 to the institution, one-page-statement of which they might have 23 had 20 pages. And they accept it as to whether or not it is 24 factual, but not analytical at that time. But after it goes 21 through the third one, we take a very definite position. The ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvF N.W@ C. C. 14 1 recommendation goes to our Planning Committee. And this is 2 consistent with sound public policy and coordinated planning 3 in our area. 4 DR. HALDEMAN: What is the composition of your Planning Committee? 5 6 DR. ROREM: The Planning Committee is selected strictly 7 from the Board of Directors. It happens to be seven members; 8 it could be eight. 9 DR. HALDEMAN: What is the composition of your Board 10 of Directors? 11 DR. ROREM: Our composition of our Board of Director3 12 is all laymen, some of whom may be hospital trustees. They 13 are the presidents of large corporations -- that is, financial, FR 14 industrial, and mercantile plus several clergy and plus soma 15 educators. 16 We have an advisory committee, this representative committee that I spoke of,, of hospital administrators. The 17 18 chairman meets with our Executive Committee and Board of Directors 19 the Advisory Committee of Hospital Administrators and an 20 advisory committee of the medical society, the profession., but it is appointed by the president of the medical 21 society, six 22 people, with the president always ex-officio. And we have 23 quite a few meetings on the side. 24 A3 far as priorities are concerned., I might say that 25 priorities are f ound on page 11 of this report when we get to ACE-FEDERAL REPORTERS. INC. 261 CONSTITUTION AvE N.W. C. C. 15 I it,, and these are the ones we have used. They are a little 2 bit generalized if you want to call it that, but the highest 3 priority with almost no quibbling at all is to any programs 4 which will contribute to greater coordination of patient care 5 within the community rather than mere sanction of existing 6 types of facilities and services. 7 The second program goes to those which will achieve 8 more effective tae of existing plant and personnel. Moderniza.. 9 tion, of course, would be a part of that. 10 The third is something like the second,, those which 11 will prolong the useful lives of existing facilities without 12 jeopardizing the standards and efficiency. 13 At the bottom of our list are programs which will FR increase bed capacity because we are caught up. We are dealin@, 14 15 from a position of surplus rather than of scarcity. 16 We all know it is easier to plan for scarcity than 17 it is for surplus. It is like the sailor says with the rope. 18 He was really in a terrible jam because he had a rope that was 19 too long. He didn't know what to do. He said, "If it was too 20 short, I could splice it, but it is too long. I don't know 21 what to do. I don"t know where to st!trt. 22 So for what it is worth, that's what we do. I didn't 23 mean to take so much time. 24 DR. HALDEMAN: I think we ought to ask questions so 25 we thoroughly understand how it works. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W@ W4'@ll"@' C C, 16 I Does your Planning Committee ever override your 2 committee of administration? 3 DR. ROREM: It has not yet; it might. 4 They have approved ten projects up till now expressly and disapproved one. And all of those up till 5 now were 6 recommendations of the advisory group. 7 But I might say that we haven't been brought into 8 court as one of the people last night mentioned they have. 9 We have been brought into the court of criticism and public 10 dissatisfaction on the part of the client that wasn't happy, 11 and they have used up till now their response and method of 12 expressing dissatisfaction as being what the lawyers would 13 call "ad hominum.11 FR They put it, not on my Board of Directors but on 141 9 15 the staff as being unreasonable and intransient. 16 MR. COUSIN: Jack, may I ask a question?. 17 DR. HALDEMAN: Yes. 18 MR. COUSIN: Rufus, what does it mean to a hospital 19 in your area if your group gives its approval or turns 20 thumbs down? 21 DR. RUREM: It means they can quote wherever they se(! 22 fit the fact it has been approved by the Hospital Planning 23 Association. MR. COUSIN: Does this have any real impact? 24 25 DR. ROREM: Yes, for both small and large contributixisl ACE-FEDERAL REPORTERS, INC. 261 Cot@STITUTION AVE., N,W. 17 1 particularly for large and somewhat small. 2 MRS. COLEMAN: Has any hospital elected to not ask 3 your opinion? 4 DR. ROREM: Up to the present time, we haven't moved 5 in and given it anyway, but we are thinking of doing that. 6 If they don't ask our opinion, we are very likely to adopt the 7 position of giving it anyway. 8 MRS. @MAN: How big a projedt? For small things,, 9 I suppose they have no obligation to consult you at all. 10 DR. ROREM: No. but the Hospital Council of Western Pennsylvania which works very closely with us has expressly 11 12 and by resolution suggested and admonished the hospitals to 13 report and ask for approval whether or not the public campaign FR 14 was contemplated and whether or not the amount was large. 15 We are not defining the word "large." 16 MRS. COLEMAN: Suppose they just wanted to put in an 17 intensive care unit or something like that. Would that be 18 something they should bring to you? 19 DR. ROREM: As a matter of fact, one hospital did 20 exactly that about $125,000 they wanted to spend. They did 21 bring it to us. And in the condition like that, it doesn't 22 go through all the channels. It goes straight from the staff 23 to the representative committee and Planning Committee. The 24 Board never hears about it. 25 MRS. COLEMAN: suppose it was something that di< ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W@ C. C. 18 1 cost very much money, but was a vital change in scope of the 2 hospital like they wanted to take out pediatrics or put in 3 pediatrics or something like that,, but they weren't increasing 4 the beds. 5 DR. ROREM: The hospitals that want to do anything 6 like that generally take the initiative and want to get some 7 approval because they know they will, probably. And so there_ 8 is no special peoblem. And in a few cases, they have done so. 9 We have a hospital which this week on Friday will 10 announce that it is closing its obstetrical department and thaL 11 all obstetrical services will be going to a hospital two blockg 12 away as of next Monday. It is a 300-bed hospital with a 36-bel 13 obstetrical unit. And the hospital that is going to pick it FR 14 up is a 550 bed, mainly maternity hospital. And the doctors hive 15 been on both staffs all the time. 16 They are going to close it. And on that,, we worked 17 with them all through this. I can't say we were more than an 18 influence. That hasn't gone through two channels at all. It 19 was applauded from the beginning, and it.- is now a reality. 20 MRS. COLEMAN: So whether it goes through channels 21 or not depends pretty much on the amount of money involved. 22 Is that more or less true? 23 DR. R@: I would say so pretty much and whether or not there is to be a public camp# 24 ,ign, the two combinations. 25 One hospital has announced by 1970 it plans to build ACE-FEDERAL REPORTERS, INC. 2 6 1 CONSTITUT'ON AVE N W. 19 i a doctors' office and interns and residents home and expand 2 and improve its emergency and outpatient department which 3 obviously would be improved. They have got the money. But 4 they can't spend it until the urban redevelopment association 5 has declared an area that is blighted. So they had to make 6 this statement of this policy in order to help the urban 7 redevelopment., 8 There -is a case where the facts have been known to 9 us, but no formal application. We are just a little bit io embarrassed that it broke in the papers, and I have told peoplB I think in their self-interest they ought to have their 12 program on record with us as it develops. 13 All isn't perf ect with us. FR 14 DR. HALDEMAN: You say that in ten instances,, they 15 approved the contemplated action of the hospital and in one 16 instance they did not, is that right? 17 DR. ROREM: That's right. 18 DR. HALDEMAN: So usually, they go along. 19 DR. KMEM: Usually, the institution goes along. 20 As a matter of fact., we turned down two. But 2i before it came to a vote of our board, the hospital said, 22 "Would you mind if we just withdrew the application completely 23 which they did. They came back a second time six months later 24 and it was approved. 25 DR- HALDMAN: If you had it to do over again, ACE-FEDERAL REPORTERS, INC. 261 CONST TUT ON AvE N.W, C. C. l@ 20 I would you use the same mechanism or a different one? It seems 2 to me it has the element of a little bit of back scratching 3 if the decisions are pretty well made by administrators. 4 MR., BUGBEE: Does it? Or if you have 26 of them or 5 25 always supercritical of the 26. 6 DR. ROREM: I might say that this last one, the one 7 that is now coming through a second time, is one that decided_ 8 to ignore -- Thi-s is one that was turned down, went right 9 ahead anyway. It happened they got Hill-Burton money and had 10 that to go on. And they went ahead anyway. 11 And, incidentally, the two we turned down both 12 received Hill-Burton money because of the particular gerrymand.-r- 13 ing at that time of the area. And the one that recast its FR 14 program, we approved. The other one, we haven't approved, ani 15 it is well along. 16 Off the record. 17 (Discussion off the record.) 18 MR. BUGBEE: Rufus, to this point Jack raised, thoUgIL, 19 would you find the 26 administrators when you get to that stag(,, 20 or as they filter up from representatives,, are they fairly 21 Judicious, or do they log-roll? 22 DR. ROREM: Let me tell you what happened this last 23 time. Usually they are unanimous. 24 This last one is going through the channels a second 25 time. And of 18 out of 26 that could have been present, 11 ACE-FEDERAL REPORTERS, INC. 261 CONST'TUTION AVE . N@W. C. C, 2 1 I voted to let the old disapproval stand. Four decided that it 2 ought to be changed. One of those votes was the institution 3 itself. And four decided they didn't want to take a position 4 and abstained. So it is not always unanimous. 5 DR. KLICKA: As you evaluate this kind of a situation, 6 what is their reasoning based on -- a prett 7 sound analysis of 7 the material that you presented to them? 8 DR. R@M: I would be willing to say yes. 9 DR. KLICKA: You agreed with it, didn't you? 10 DR. ROREM: @Yes. 11 Mr. Willis was present at all of these. 12 Dave, why don't you get into any points as long as we 13 are discussing this? You are at a distance now where you can FR 14 think back where we could have done something different. Is 15 what I have been saying somewhat similar to what you might hitviE 16 said? 17 MR. WILLIS: Yes. 18 DR. RMEM: Up to now? 19 DR. HALDEMAN: First, I think Jack Cousin had a question. 20 MR. COUSIN: I wanted to know,, do you work with ostec- 21 Pathic hospitals andt secondly., how does Government react to 22 this? 23 In Other words, if there is a city, State or a county 24 institution, or even if there is a health problem involving the 25 cityo State,, and county, Federal Government. We don't have ACE-FEDERAL REPORTERS, fNC. 61 CONSTITUTION AVE N W. D. C. 22 1 much luck except with Hill-Burton, but the city, State and Coulty, 2 for example, if it is a city hospital and they want to cut out 3 pediatrics, does this get to you either from the hospital or 4 from the city council or the Board of Health? 5 DR. ROREM: 'Let me say first of all, and this makes 6 us unique, this happens to be a trading area in which there is 7 no local government hospital, the largest one in America by far. 8 Secondly, there is one 25-bed osteopathic hospital in 9 this whole area. 10 And the third is that there is no proprietary 11 hospital in the whole area. It makes the issues a little 12 sharper. 13 Another fact is that at the present time we don't FR 14 know of any M.D.s who want a staff appointment that donle have 15 one. 16 Now, the osteopaths, however, they have a nice 17 hospital, and you,go 25 miles out or 30, osteopath hospitals 18 start up again. But in Pittsburgh, they haven't up to now. 19 MR. COUSIN: What would you do if you had a request 20 for an osteopathic hospital and you could pretty well develop 21 that the osteopathic physicians had much fewer beds available 22 to them than the M.D. hospitals, and they wanted to put a 23 hospital up where there was a surplus of beds, but not of 24 osteopathic beds? 25 DR. ROUM: I know. I don't know what we would do ACE-FEDERAL REPORTERS I NC. 261 CONSTITUTION AVE . N W. W@ ........ 0. C. 23 1 at this point. I suppose after we got over the faint, the 2 faint of the first time, we would see what could be done about 3 taking care of these people because our State is very similar 4 to Michigan except that here the M.D.s have the lily-white 5 concept which is pretty well accepted in the general community. 6 That is strictly M.D. 7 I don't know of any institutions in the immediate 8 area that have any M.D. hospitals that have osteopaths only- 9 not a single one. 10 MR. COWIN: We have something like 2,000 osteopathic 11 beds out of 17,000. We have one county where something like 12 15 per cent of the people in the county are being cared for b 13 osteopaths. FR .1.4 DR. ROREM: We have less than 50 out of 8,000. 15 MR. COUSIN: And you are not going to change that; 16 we are not. 1.7 MR. BUGBEE: I don't want to stop at the osteopath, 18 but I want to ask you, you have been a little elusive about 19 who presents the brief for the hospital. 20 In fact, as you are describing it, the hospital 21 presents its data and you and all the rest question the data, 22 but it is really the applicant's responsibility to present all 23 the data. 24 DR. ROREM: Yes. 25 You understand that this has all reached them before ACE-FEDERAL REPORTERS. INC. 61 CONSTITUTION Avc N.W, W a c 24 I they come to the meeting. 2 MR. BUGBEE: That's right, but still, it is their 3 presentation rather than the planning staff. 4 DR. ROREM: Up until it reaches our Planning Committae, 51 then I am in there giving my opinion pretty strongly. 6 MR. BUGBEE: Or you might question them or ask them 7 for new data or bring in your own data. 8 DR. R@: That's right. 9 MRS. COLEMAN: Do you tailor their program somewhat? 10 Do you modify it? In addition to approving or disapproving, 11 do you change? 12 DR. ROREM: I would say it is fair to say that most 13 of the programs by the time they even reach the representative FR 14 committee have been changed materially. 15 Wouldn't you? 16 MR. WILLIS: Yes. 17 I think it is part in answer to your question and Mr, 18 Bugbee's to note that there is a working schedule set up. Eveiy 19 hospital must have its long-range planning committee, which 20 committee must announce long in advance of the time it comes 21 to these official committees what its tentative plans and 22 programs are. And then the staff works with them. And most 23 of the modification and so on occurs there in the early 24 planning stages before it ever comes to the committee. 25 DR. ROREM: I might say we have Postponed I would sa]p ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AvE N.W. W45.1,@'ON, 0. C 25 at least a dozen projects, not disapproved, just postponed. 2 And just they were out of this world and weren't to be considered 3 at all. One project was for complete rebuilding of a mental 4 hospital. Th ey were going to spend money for renovating first and $5 million for a nonprofit unit of about 300 beds and it 5 6 looks now as if they are going to just drop it completely and 7 'go out of the-nurses home business and set these people up over 8 in their big nufges home. And this is an illustration. 9 DR. KLICKA: In these meetings, Rufus, is there a 10 complete agreement on the accepted bed need for an area between 11 your organization and the State organization that is responsible 12 for the administration? 13 DR. RCREM: And the Hill-Burton. There is now. FR DR. KLICKA: Do they accept your figures or you 14 15 accept theirs? 16 DR. ROREM: They are the same figures. 17 DR. KLICKA: You are not answering my questions. Are they yours or their f igures? 18 19 DR. ROREM: We gather the figures for them. There 20 is no conflict as to what the mathematics is. 21 DR. KLICKA: Who computes the beds? Do you do it 22 or the State do it? 23 DR. ROREM: For the State plan? 24 DR. KLICKA: No. for these regions that you are 21 talking about where a hospital comes in and says, "We want to ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W@ i7. C. 26 I develop a program that will add 200 beds. Does that 200-bed 2 figure come within your purview or is it the State plan? 3 DR. ROREM: It isn't cut that fine, really. We typi- 4 cally would accept as available beds some that might have been 5 thrown out as non-fire-proof which ate in use. The State' 6 uses a strictly mathematical formula for engineering for 7 acceptable and nonacceptable beds. So we would be inclined to 8 have on balance -included in the list of beds some that we 9 know to be closed down, for example, which the State wouldn't 10 know because they don't go behind that., and some which the 11 State would regard as nonacceptable. 12 DR. KLICKA: All right. There is a problem there, 13 but I am talking about the overall bed need for a region. Who FR 14 compiles that bed need? Do you do it or the State do it to 15 sItart with? This is a fundamental thing. 16 MR. WILLIS: The State does it. 1.7 MR. BUGBEE: Who said you are f lush.7 in beds? You i8 started out a while ago saying you have more beds than you ig need. Who said that? 20 DR. ROREM: We assert that on the basis the beds 21 are not used to capacity and on the assumption we keep current 22 records of bed use. And on this simple principle, if beds areIL't 23 used to reasonable capacity, there isn't a need for more in 24 the totality. And this isn't just a single figure. The bed 25 vacancy is a composite. ACE-FEDERAL REPORTERS, INC. (51 CONSTITUTION AVE . N.W o@ C. 27 Whatever the bed vacancy, maybe more than half of 2 those are maternity and pediatric and something else, less 3 than half are medical and surgical. And one of the things that 4 we work toward and are trying to bring about is the transfer 5 of medical, obstetrical, and pediatric facilities for use'for 6 general beds. And if that were done, it would relieve the 7 need completely even in periods in the winter peaks. 8 MISS ANKINS: You mean for medical-surgical,, diverting 9 O.B. and pediatrics to medical-surgical? 10 DR. ROREM: Yes, and we are trying to get more 11 hospitals to drop this obstetrical entirely. 12 I hasten to say the hospital that is doing this isn't: 13 doing this as a matter of abstract theory. It is a very FR 141 practical administrative decision on their part. We don't 1 15 hope for anything more than enlightened self-interest, at least 16 I don't. I hope every hospital would be guided by what it .17 thinks is best for itself, but would also know what is going or. 18 around it so it would be an enlightened self-interest and 19 Inot a short-sighted one. 20 MRS. COLEMAN: Do you have very much difference in 21 quality between your hospitals? I mean, do you have very good 22 ones and very poor ones? 23 DR. ROREM: Yes. 24 MRS. COLEMAN: This presents a real problem. If a 25 good hospital wants to add beds, but there are enough beds if ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT ON AvE., N W@ a C 28 1 you count all these raggedy beds around, what do you do in 2 those instances? You say you can't build any more beds 3 because we have enough beds in this area? 4 DR. ROREM: You asked what do we do. We do the best 5 we can. But what do we think or what do we say? 6 MRS. COLEMAN: Yes. 7 DR. ROREM: We try to take a look at the particular_ 8 need. 9 For example, one hospital adding beds for research 10 work in metabolism, we don't consider that as having to competB 11 with the medical-surgical cases. 12 Likewise, another hospital has added which we approved 13 just recently a building program which is going to add eleven FR 14 intensive care beds and a few more for rehabilitation. They 15 don't have to scramble for our office's priority concept. 16 And another one is going to put up, which we approve4l, 17 a 78-bed chronic care unit right on the grounds of the 18 institution. We don't regard that as being competitive with 19 the addition of general care beds. 20 MISa' JENKINS: Rufus, do you examine those parts sucli 21 as the chronic and long-term care units and so on on the basis 22 of the hospitals justification, will it be financially sound 23 if they want to do a certain type of research? Do you discuss 24 with them are they going to utilize this facility? It is goini 25 to be a charge to the general patients to underwrite it, or dc ACE-FEDERAL REPORTERS, INC. 261 Co STTTUT ON AVE N W 29 I you go into this at all? 2 DR. R@: The only place that research has come up 3 has been in connection with the university medical school and 4 affiliated institutions. 5 MISS JENKINS: That's enough said right there. 6 DR. KLICKA: Do you think that's the role of 'the 7 Planning Council? 8 MISS J M INS: To some extent. 9 DR. ROREM: We get into the operations, if you mean 10 by that -- 11 DR. KLICKA: I wonder if we could put this on the 12 agenda. I think it is a very important question. 13 MISS JENKINS: Do you think it is basically wrong, FR Carl, if they are going to put a particular special service in 14 15 which they have not well programmed? 16 DR. KLICKA: We are talking about research? 17 MISS JENKINS: Oh, no. I am talking about research 18 where it involved beds and what the financing of that research 19 will be. I am thinking only in terms of beds -- that is, beds 20 that would support research. 21 DR. KLICKA: This wouldn't be very many beds. You 22 are talking about a small 7- or 8-bed ward to support a 23 specific research. 24 MISSJENKINS: I would not be involved in that. I 25 thought Rufus was talking about something a little bigger than ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE . N W, 0. c 30 i that. 2 DR. ROREM: We do have one 24 beds. 3 MR. WILLIS: I would like to add something to Dr. 4 Roremis last three comments, first, to Dr. Klicka. 5 When Dr. Rorem was just getting started, the state 6 agency computed bed needs simply on bed population ratio. And 7 all of their ratios were much higher than locally was believed 8 to be necessary.- And this created, you can well imagine, some 9 problems. Money was dangling there and plenty of empty beds 10 around. 11 Two things occurred to change that situation. 12 First and most important was that the state Hill-Burton began 13 to modify the bed population ratios by direct inclusion of FR 14 utilization data in their concept of need. 15 The second was the Hill-Burton areas themselves were 16 redefined so that the city boundary was broken. 17 Now, in Pittsburgh, as in most cities, there was an 18 excess of beds to population. Once you broke down the city boundaries as arbitrary limits of an area, you throw those 19 20 excess beds into the suburb calculation and you imediately 21 watered down that need, too. 22 So both these things happened at the same time. And 23 interestingly, the local hospital when presented with the idea 24 of changing the Hill-Burton areas this way, knowing in advance 25 that this was going to virtually wipe out any Hill-Burton ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AVE. N@W W@LH@NGT @, D@ C. 31 I priorities for general beds, still went along and voted for 2 it. And the express comment was, 'We better learn how to use 3 what we have before we ask for more, it which was pretty good. 4 I am not sure all of them really knew what they were 5 voting for, but they did. And the Hill-Burton agency adopted 6 the same areas. 7 Then'the matter of quality. When these areas were 8 redefined, a big teaching hospital and a good hospital was 9 put at the core @f each area. So every area has got at least 10 one good hospital and every area has got at least one bad ii hospital. So the good hospital begins to protect the interes.tii 12 of that area, and it will always be given a higher priority to 13 try to protect that way. FR 14 On the matter of getting involved in program and 1 15 1financing, I would like to point out a difference that has 16 impressed me between the way this is happening in New York and 17 the way it happened in Pennsylvania. 18 In New Yorkp statistically, there is a great unmet 19 need for long-term care beds and virtually every hospital in 20 the Rochester region is putting in an application for nursing 21 home beds and chronic disease beds and so on. This was quite 22 a marked contrast to the situation in Pittsburgh where C. Rorem's 23 group had gotten so involved with each institution pointing out mmin 24 the difficulties in financing and in staffing and in progra & 25 and how this will relate to the short-term care and so on. ACE-FEDERAL REPORTERS, INC. 26 1 CONST'TUTION AVE N.W W@ ;HINIIQN 0. C. 32 I There were very few tears because they anticipated the 2 problem, whereas in New York they were doing it simply on the 3 basis of beds and available money and nobody is really terribly 4 concerned about how this is going to be financed or what the 5 program is going to be. 6 One, you have a plethora, and the other one a dearth. 7 I don't know which is better. 8 MR. C6@IN: Rufus, if I understood you correctly, 9 before a project comes to your attention, each hospital has 10 to have a long-range planning committee and a long-range plan. 11 DR. ROREM: That's right. 12 MR. COUSIN: Now, has your Planning Council okayed 13 all of these long-range plans because it is conceivable -- FR 14 DR. RCREM: We haven't even received them all. 15 MR. COUSIN: It is conceivable to me a hospital coull 16 come to you with a short-term project that fits in very nicely 17 with a hospitals long-term planning, but the long-term planniig 18 doesn't tie in at all with the long-term community planning. 19 DR. ROREM: Right, it could be. We do the best we 20 can. 21 For one thing, we just continually repeat in variatiims 22 on this theme that it isn't the first cost, it is the upkeep 23 that causes the most of the problems for the institution and 24 the community. A $4 million hospital is going to cost $60 25 million before it is discarded. Somebody is going to have to ACE-FEDERAL REPORTERS, INC. 261 Co"45TITUTION AVE N.W w@lh(II-1-01 0 c 33 pay t divided by three for the annual operating budget for I hat, 2 rough-and-ready purposes and figure the length of life. 3 And so you aren't just committing yourself to $4 million; you 4 are committing yourself to $64 million, assuming no change in 5.the price level. 6 MR. SIBLEY: It sounds like marriage. 7 (Laughter.) 8 MR. COtbIN: Do you intend to eventually O.K. all of 9 their long-range plans? 10 DR. ROREM: We aspire to that, yes. I don't want 11 to give the impression that this is -- You know, a guy always 12 can talk more freely away from home. I imagine the rest of yoii 13 are doing the same thing. FR 14 (Laughter.) 15 DR. HALDEMAN: Rufus, behind your whole discussion 16 and the effectiveness of what you have done, isn't this the fact 17 that there are relatively few major sources of capital construc- 18 tion funds,, a few industrialists provide a fairly large bulk? 19 DR. ROREM: I would like to answer that. That's what 20 'I thought when I came there. 21 DR. HALDEMN: But it isn't true? 22 DR. ROREM: It is not true. Big industry provides 23 in the gross something less than -- I thought in the aggregate 24 about a third of all capital funds, corporate contributions. 25 It isn't true. It is not more than 20 per cent, and it is AGE-FEDERAL REPORTERS. INC. 261 CON-TITUTION AVF N.W@ K@ 0. C, 34 1 concentrated in the areas up till now where the big industries 2 have their concentrations of employees. And suburban hospitals, 3 just for general purposes and convenience of travel, have a 4 very hard time getting big corporate support. I mean the 5 new residential suburban hospitals. 6 Now, a town like Homestead or McKeesport or Sewickley 7 where there are heavy concentrations of employees, they 8 continue to give-very, very good support once a thing has gone 9 through. 10 DR. HALDEMAN: Conversely, if your organization did 11 I'not recommend that there be an addition to a hospital, would it 12 be very difficult for them to raise the capital construction 13 funds? FR 14 DR. ROREM: Yes, it would -- has been. 15 DR. HALDEMAN: In other words, in the last analysis 16 DR. ROREM: Even if they weren't going to give an 17 awful lot anyway, it still throws a pall over the campaign, 18 no doubt about it. 19 DR. HALDEMAN: But you do in a situation wheteyour 2o real implementing force is the influence on the givers of 21 capital construction funds. 22 DR. ROMM: Especially big givers. 23 MR. BWBEE: The thing you brought out last night 24 that is important, too, you say 20 per cent big givers and 20 25 per cent small givers, your small earners and bank loans and ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AV E . N@W@ 0. C 35 I bank loans are affected by sanctions$ too, you see. 2 DR. ROREM: That's right. 3 MR. BUGBEE: I don't know as much as they should be 4 but didn't you and Jack both say that the loaners are beginning 5 to talk about what the recommendation is? 6 DR. ROREM: That's right. 7 I might say also that we haven't had a general hospital 8 even give any tCought to a big program unless they got Hill- 9 Burton money. 10 MR. BUGBEE: Unless it got? 11 DR. ROREM: Yes. And up to now, some are starting 12 to talk about it, but it is all for expansion or for non-bed 13 activities and no bed expansion has even been thought of FR 141 except in terms of Hill-Burton support. 15 And up to the present time,, there is no difference 16 of judgment between the Harrisburg office and ours. 17 MR. BUGBEE: You mean from the present on, not up to 18 the present time. 19 DR. ROREM: No, actually, the very first six months we 20 were there,, we disapproved two plans. Both of them a month 21 after we disapproved them were approved by Hill-Burton, both 22 of them. And we are still wrestling with that fact. 23 We later approved one, and we still haven't approved 24 the other. 25 DR. HALDEMAN: Off the record. AGE-FEDERAL REPORTERS, INC. 261 CONSTITUTI(ON AVE N.W@ 36 1 (Discussion off the record.) 2 DR. KLICKA: I hope we can come back to this. 3 This question is beginning to be a real problem in Illinois. 4 DR. HALDEMAN: Well, I don't mind opening discussion. 5 Well, we will put it on the agenda to discuss. 6 MR. BUGBEE: Let me ask, Rufus, has Hill-Burton 7 designated you? Do they before they grant money now ask your_ 8 recommendation?-'Is there any official or unofficial agreement 9 DR. ROREM: Yes, in writing, and I have to quote it. 10 They will make no final decision on a request for Hill-Burton 11 funds until they ask our organization whether it is consistent 12 with the broad plan for Allegheny County. 13 MR. BUGBEE: It hasn't gone long enough for you to FR 14 tell except those rec ndations. 15 DR. ROREM: After those first two went through, there 16 has been no difference of opinion. 17 MR. BURLEIGH: What kind of a time interval elapses, 18 Dr. Rorem, the time you first have a project until the time the 19 Council -- 20 DR. ROREM: First brings it to our attention, put it 21 that way. 22 We don't always live by, but we have set an eight 23 months time lag, eight months lead time'. And we have spent 24 that particularly with respect to Hill-Burton recommendations. 25 But sometimes it is two years. Sometimes it is quite a while. ACE-FEDERAL REPORTERS, INC. 261 CONST'TUTION AVE N.W, W@,.:N"ON 0. CI 37 I I know I am taking up a lot of the time, but I am 2 getting my money's worth in here because I can't be here 3 tomorrow. But I might say that we had two hospitals that were 4 all ready to go. They were going to apply for Hill-Burton. It was pretty clear they weren't going to get it, so they 6 relaxed. So they are now getting down to the merits. They 7 can get it now. 8 They we're four miles from each other. They had 9 almost identical short-range and long-range problems. The short- range problems, they both had unsuitable facilities being used, 10 11 One happened to be the obstetrical department which 12 was in the prime location and was too big and the medical and 13 surgical facilities needed to be replaced. FR 14 The other had exactly the opposite. The obstetrical department was in bad space in old buildings and medical and 15 surgical was running high. So they both had to do something 16 7 quick within five years, also in three years, but also something 18 quick. 19 So we focused their attention, each one, upon what 20 they could do without -- using the expression -- doing anything, 21 what administrative decisions could be made. 22 And in cooperation with the Hospital Council and a 23 physician on their staff, we made administrative and space 24 utilizations of what they now got. As a result of the 25 inspection, we turned up the equivalent of about 25 beds in ACE-FEDERAL REPORTERS, INC. 261 CONST TUTION AVE N.W. 0. c 38 I one institution that could be had just for administrative 2 decisions. 3 For example, a certain segment of pediatrics could 4 be used for medical and surgical. That's one illustration. 5 The director of nurses had herself and her assistant; 6 right in the middle of the patient care area with empty space 7 in the nursing home 50 feet away. All she had to do was move- 8 out and there were eight beds. 9 Another was an introduction of a discharge timing 10 which by announcement,curiously enough was accepted by the 11 'doctors and had the equivalent of opening up another eight 12 or ten beds as far as this total was concerned. 13 So they are back to normal again, but still need to I FR do something. 1.4 15 And the other hospital wasn't full except in the 16 medical and surgical. 17 The point I am coming to is this simple that at 18 several meetings, I finally got the representatives of the 19 boards of both hospitals together, Willis with me. We had a 20 long session and I talked freely. When I wrote up the minutes, 21 I called it a su ry. I even gave it a title -- "Challenge 22 and Opportunity." And the challenge and the opportunity was 23 to work together. And I recommended that they have a list of 24 about 20 things in which the hospitals were alone and seven 25 things that they could do together and recommended they have a ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W. D. C. 39 I joint consultant on a program. 2 And they have agreed to this and are going to pay 3 out cash for a joint consultant. And it will be a physician 4 in our area. They have agreed on someone. It looks now as 5 if it is going to be one of the members of the school of publi: 6 health, Dean Clark, you all know him. 7 So we get neck keep into operation and into operatin@ 8 finances. And w-e have the advantage that there is nothing 9 except sympathy and understanding from the Hospital Council. 10 And Mr. Sigmond's -- who is so interested in this -- main 11 criticism of us is we don't do enough, we don't get deep 12 enough into operations. We should be doing more; we should 13 be pressing harder. FR 14 So the criticism we get isn't that we are interfering 15 too much, but we aren't interfering enough, which as a short 16 round is a good criticism to have. 17 MR. PETERS: I am inclined to say -- you mentioned 18 eight months and as high as two years for a proposed study -- 19 in New York there is a proposed bill which hasn't got a committee 20 yet, but it will probably have a committee this year which says 21 that the regional council should make c nts on establishment: 22 of new construction in 45 days and 60 days on expansion of 23 facilities. And this has bothered a lot of us because we won- 24 dered how with our particular committee structure we could get 25 an opinion out in 45 days that represented anything than an ACE-FEDERAL REPORTERS, INC. 6 I CONSTITUTION AVE . N,W. WA,qr@c@@N D. c 40 I off-the-cuff opinion. 2 George can comment on that because George was 3 chairman of one of our committees for years and knows how 4 difficult it is to extract an opinion in 45 days. MR. BUGBEE:' He is probably right Eight months 6 is about what it takes. 7 MR. PETERS: That's pretty much our experience, 8 about eight montfis. 9 MISS JENKINS: This is consoling, Joe. We had one 10 demanding an opinion next week,.,and it has been four months 11 now, and we are taking a beating over it. And we are not 12 about to render an opinion yet. 13 I will go back and quote you. FR 14 DR. ROREM: A3 it goes forward and the other describe 15 their procedures, I would be very much interested to know what 16 reactions you folks have to getting the administrators and 17 representatives of other hospitals involved because as far as 18 I know, we are the only ones that get the other hospitals 19 involved with anything like this depth. And I might say this 20 was written into our bylaws, this advisory committee of 21 hospitals, before I came and at the insistence of the hospitals 22 at that time. 23 I say "hospitals," the presidents and management. 24 MRS. COLEMAN: What is the range in size among the 25 hospitals? ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N,W. 41 1 DR. ROREM: Our smallest hospital, general hospital, 2 short-term hospital, is 119 beds. 3 MRS. COLEMAN: And the largest? 4 DR. ROREM: About 650. We have four of those. 5 DR. HALDEMAN: I don't want to prolong this. There 6 is one other area, though, I think we ought to get into.in 7 relation to each of the communities we are going to talk about. 8 And that is the @entral city versus suburban problem and what 9 the problems are and how you are meeting it because it seems 10 to me like an areawide planning group, this is one of the hardest 11 problems to tackle. 12 You may have a surplus of beds in a central city, bul: 13 you have suburban areas growing up which are going to, in many FR 14 instances, get proprietary beds if you don't let them have their 15 own beds. 16 You might speak to that point. 17 DR. ROREM: We take the position that suburban, 18 through statistical facts which are true which we point out., 19 a number of statistical facts, one is that at the present time 20 there are not many specialists living in suburban areas having 21 offices in suburban areas. They haven't come out there in part 22 because there haven't been hospitals.- 23 But we have suggested that the principle of the 24 satellite hospital be used and even if it is a,bed facility that 25 it be an offshoot or be sponsored by one of the larger ACE-FEDERAL REPORTERS. INC. 261 CONSTITUTION AvE.. N W, wqs@'Na@ON, 0. C. 42 I institutions in order to reduce overhead costs and duplication 2 of facilities. 3 There is an emotional appeal in the new areas, of 4 course., for an institution that will be identified and be a 5 part of it. But when the chips are down for money, they don't 6 come forward with the money. And even this institution, thi-S 1 7 $4 million institution, that is going forward, after three 8 years, they hav4-'raised and have got $1 million in pledges, caith 9 some portion of it. And it is not identified. We tried to 10 get them to identify it whether it be an offshoot or branch 11 of one of the other larger hospitals, but it is an old institution 12 with a good name, and they wanted to continue it. 13 They are moving away from an area of great need, but FR 14 also an area quite uninteresting to the institution because it 15 is a blighted area. 16 MR.BUGBEE: You know, Jack, on this issue you raise, 17 it is like the question of the administrators conference, I 18 think. One of our major problems is trying to establish 19 procedures and principles that apply to different sized metro- 20 politan areas. 21 I suspect New York, Chicago, probably Detroit, 22 Pittsburgh, is probably the size where you can do it, Cleveland, Rochester, Columbus. 23 24 DR. ROREM: That's right. 25 MR. BUGBEE: For the administrators council, but i ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AVE N.W@ 0, C. 43 I think the questions of suburban versus central city are 2 almost equally separated. And we talked last night, and Rufus 3 got this page where he has five regions. 4 Well, you could make an argument about central city 5 serving the entire area much more validly than you could in 6 Detroit, I would guess. I think your issue is: Do you. want' 7 your beds spread that way? The old Hill-Burton geography a points towards sireading, but I don't know that the travel 9 anywhere here is prohibitive. 10 DR. ROREM: There isn't anybody who is more than 11 one half-hour from a hospital. 12 MR. BUGBEE: You at least by travel have the option 13 Of having the hospital in the center or outlying. Then, the FR 14 question comes where it should be and that's the part I don't 15 DR. ROREM: I used statistics that I am sure I call 16 attention to in one item of the travel. 17 One, I point Out that after all, these fine roads 18 that cause people to move out to the suburbs run both directions. .19 So, you see, it is just as easy to get back as it was to go out. 20 And the other is that as far as bed cire is concerned 31 21 on the average, a person is bedded down at the advice of a 22 doctor about once every eight years. But on the average, he will 23 see a doctor about live times a year. So only one out of 40 that 24 see a doctor. So the important thing is to have doctors in the 25 community that are handy and quick. ACE-FEDERAL REPORTERS, INC, 61 CONSTITUTION AvE N W. W@.",NG,ON , D, C, 44 1 We had a situation in our area where a man . a 2 department head of one of our large corporations, worked his 3 heart out on a drive for a hospital that was only going to be 4 a half-mile from his house. He thought, "How wonderful when 5 you wake up in the night and the kid has a cramp and rush him 6 to the hospital." And just before the ribbon cutting, he wa@ 7 transferred to Milwaukee and had to start all over again. 8 (Laughier.) 9 So this idea of convenience to a hospital. 10 And another case, one of the fellows working on this, 11 j'his wife got sick while up in Butler County and had to come 12 back 20 miles. 13 MR. BWBEE: Rufus, you are talking about the five FR 14 visits versus once in eight years. 15 Jack, even that little research you did or your 16 department did pointed out that parking was the crucial thing. 17 See,.even for the five visits a year, if you had your doctors 18 where there was ample parking, probably the half-hour isn't 19 prohibitive to take the child, leave out the emergencies. 20 DR. RMEM: In the study of emergencies. we found thiLt 21 the people that are medical emergencies or psychological 22 emergencies where they travel fast to get somewhere, they waited 23 longer before they were seen than they did the time traveling 24 to get there. 25 MR - S IB LEY: I w.ant to follow.Rufus' point a little ACE-FEDERAL REPORTERS, INC. 261 Co"ST'TUTION AVE N W. 0 c 45 i more because it leads into a broader subject perhaps which you 2 just ended by saying you are planning for the location of 3 physicians and you are not using physicians at all in your 4 procedure by which you review hospital plans or patient care 5 facility plans. You are using only hospital administrators. 6 And at this point, the question comes,, is the hospital 7 administrator capable of speaking for his medical staff, or 8 are medical staff's willing to abide by the speaking of the 9 administrator when the review takes place? 10 DR. ROP-EM: It is up to the institution to have 11 cleared all of this before it comes to us. And some of these 12 bring physicians along to these meetings. 13 I might say further that we propose from now on because FR 14 of the interests of this committee of six doctors to use them. 15 They have even said they would be willing to go on record as taking a position on plans. 16 17 MR. SIBLEY: So this would be another planning 18 procedural step- 19 DR. ROREM: It would be a parallel one or participating. 20 MR. SIBLEY: You gave us four steps. Would you put 21 it in here some place in the four steps? 22 DR. ROREM: It would be a parallel one. The six 23 doctors are invited to all these meetings. A couple of times, 24 they have come. 25 MR. SIBLEY: So up to now, your physicians, the ACE-FEDERAL REPORTERS. INC. 261 CONSTITUTION AvE N.W t. c. 46 1 representatives of organized medicine, because I presume this 2 is what they are, have not felt threatened, so they have not 3 begun to appear. 4 DR. RMEM: That's right, but they say now they are 5 willing to and would like to. There is no provision for them 'to 6 take an official position, but the chairman has said they 7 would be willing to take an official position. And I have got- 8 to'bring that to my board and see if we want them to. 9 DR. HALDEMAN: Jack. 10 MR. COUSIN: I was going to ask something else, but ii this physician discussicnchanged it a little bit. 12 When we did a patient distribution study, the same 13 as you did, we also did physicians. FR 14 DR. ROREM: We did, too, but we can't analyze it 15 statistically. It is too vague. 16 MR. COUSIN: We are going to do this over again-about 17 every five years. But meanwhile, we have done it-from time to 18 time in certain study areas for certain specific purposes. 19 DR. ROREM: You mean just the facts where the doctors 20 leave their offices? 21 MR. COUSIN: Yes. 22 DR. ROREM: We have done that. 23 MR. COUSIN: We have discovered a great many more 24@pecialists out in suburbia than you seem to indicate. 25 DR, ROREM: We are getting more, too. The last three ACE-FEDERAL REPORTERS, INC. 26 1 CONSTTTUTION Avc., N.W, W45HII-I@N 0. C 47 1 years made a difference. 2 MR. COUSIN: Getting back to the central city versus 3 the suburbia and probably the size of the city metropolitan 4 area has a lot to do with it, but besides, what about suburbanite 5 not wanting to come downtown because of the parking, and not 6 only because there is this terrific emoticqal play in having 7 a hospital in X,, Yo Z suburb, many of the patients and 8 perhaps even a higher percentage of physicians do not like some 9 of the social changes that are taking place in the metropolitan lo hospitals. 11 You could give them the world's best parking lot and 12 you could have all these beautiful highways running back and 13 forth, but they just don't like going to some of these formerl3 an( FR 14 still well-known top-flight institutions where the complexion 15 of.the patient load is changing rather drastically. 16 MR. COUSIN: The nice people want to be in the-country. 17 MR. BUGBEE: Be sick with other nice people. 18 MR. COUSIN: And some of these hospitals out in the ig country are having a higher percentage of specialists than they 20 had previously. And gain of the top-flight run at the Harpers 21 and Graces and Mt. Carnals and so forth -- well, Mt. Carmel is 22 semi-suburban -- but saw of these top-flight @town hospital 23 are losing a@ of their better men, particularly the follows 24 50 years and under who &re moving their offices out into the 25 Birmingham's and the Grosse Points and so forth. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AVE . N@W W, 0. C. 48 I So that I am not so sure that the roads and the 2 parking are all the answers. 3 DR. ROREM: Oh, no. 4 DR. HALDEMAN: I think we perhaps ought to move on 5 to Southern New York. I do this with a bit of anxiety, you 6 might say. 7 During the Bugbee Committee deliberations, we had 8 four representat7ives of this metropolitan area on the committee 9 and we finally had to pass a rule that New York City couldn't lo be mentioned in this-committee -- (laughter) -- that we would ii never come up with a report on areawide planning. 12 In recent weeks, I have had a chance to talk to a 13 number of the people in New York interested in this metropolitan FR 14 planning group. And that is to the coaching by lbvg Coleman. i5 I think I was assured that something could be done in this area. 16 So, Joe, I wondered if you would lead off, and-Georg(@ 17 might like to speak, anyway you want to present it. 18 MR. PETERS: Again, we seem to be outnumbering the 19 rest of you three to one, although George is a Chicagoan now. 20 MR. BUGBEE: Alumni. 21 MR. PETERS: But a very important alumni. 4b 22 Actually, as far as New York is concerned, you have 23 got to think in terms of two distinct organizational structures. 24 First is the 24 years continuous existence of the Hospital 25 Council of Greater New York. And then, more recently, during ACE-FEDERAL REPORTERS, INC. 261 CO@NST'TUTION AVE,. N.W w@sHt,qG,QN, C. C. 49 1 the past year and a half or so, the Hospital Review and 2 Planning Council of Southern New York. 3 Even though there is a tie between the two, they are 4 structured somewhat differently, although a good deal of the 5 history of the former has been inherited so far by the latter. 6 Let me talk first about the Hospital Council of 7 Greater New York which I said had 24 years of existence and 8 which was the first planning council which purported to 9 represent the community and which had a community-based board 10 of directors. 11 We devised a master plan when Dr. Pastore was there 12 in the middle 140's. This master plan, as you all know, and 13 I won't go into it in detail, is based on the bed-death ratio FR 1,4 and established a certain number of beds and made some arrange.. 15 ments for distributing these beds primarily by teaching functions. 16 Over the years, we found that it was of little.use t4) 17 us. And during Dr. Nickelson's regime, we pretty much discarded ,8 it, although we have still continued to use a modified figure 19 based on the bed-death ratio. And I say, "modified". we modif], 20 it pretty much the same as,you all do on the experience of 21 demand,, use. If we find facilities aren't being used, quite 22 obviously, we have a sufficient number of beds. 0 23 In New York City in general, I am talking about the 24 five boroughs of New York City, we have a sufficient number of 25 bedsl although as is true of probably all of your areas., they ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT ON AVE N W, I( WASHIIGTON. D. C. 50 i are very poorly distributed. Manhattan has many, many more 2 beds than it needs and roughly about 60 per cent of all the 3 patient care rendered in Manhattan hospitals is rendered to 4 Manhattan patients. The other 40 per cent of the patients 5 come from all over the'city and all over the region and even,. 6 from all over the country. 7 So our big problem in gew Yor@ which parallels 8 pretty much what-br. Rorem talked ab out here, we have an area 9 where we have enough beds. We found out that the population 10 'of New York City.has gone down since 1950 and little change is 11 expected in the next 20 years. 12 In fact, we have just published, and I am sure all 13 of you have a copy of it, a monograph dealing with the future FR 14 population of our region. We find that in New York City, as I 15 said, we expect little or no change in numbers of people, 16 although we expect at least a 2 million growth in the other counties outs ide of New York City, primarily Nassau, Stiffolk 17 18 and a few of the ones up north of the city. So this presents 19 a new problem for the new Council. 20 First of all - what do you do with New York City? 21 And secondly, what do you do to meet the growing needs in the 22 suburban Counties? 23 We haven't done much about the latter, and one of the 24 big things we have done during this first year of our new 25 existence has been to .spend as much time as our small staff ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE N,W. 51 I would allow to get familiar with the problems and the character- 2 istics and the hospitals of the other nine counties outside of 3 New York City. And this is a tremendous job. We are talking 4 about now outside of New York City more hospitals than probably 5 any of you have except Dr. Klicka. We are talking about 100. 6 hospitals outside of the five boroughs of New York City and 7 140 general hospitals in the five boroughs of New York City, 8 a total of 240 tf6spitals with roughly 115,000 beds, I believe. 9 We are talking about a huge complex. 10 I dreadit)o think what would happen if our present 11 staff got the long-range plans of every one of these 240 12 hospitals. 13 (Laughter.) FR 14 I wouldn't know how to file them, much less how to interpret them. It isn't a problem. 15 16 Ours is a problem of dimension to a great extent. 17 So let me talk about how the old Council operated and then go 18 into very briefly how the new one hopes to operates 19 The old hospital council did not get involved -- 20 correct me if I am wrong, George, because you were on the 21 policy end, I was really on the staff end -- the old hospital 22 council did not get involved in studying hospitals or giving 23 advice unless it was formally asked. This is pretty much like 24 you said your early days were. We did not do any studies. We 25 did not render any opinions. We did not make any recommendations ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AvF N,%Iv 52 I unless the group or the hospital or the agency wrote to our 2 Board of Directors and our Board of Directors took this up at 3 its next meeting and passed a resolution that the staff should 4 or should not work on the problem. 5 This was the pattern for at least during my stay there 6 and I am sure it was a pattern for all the 24 years of the old 7 council. This meant and still means that a lot of institutions, 8 a lot of agencidi, do what they darn well please because unless 9 they ask us, we have never given our advice. And,, unfortunately, 10 an awful lot of.hospitals haven't asked us. In fact, some of the greatest institutions have never 11 12 asked us about our opinion. And until very recently, none of 13 the proprietary hospitals of which we have about 40 in New FR 14 York City and another 20 outside to make a total of 60 have 15 never asked our opinion, although in the past year this has 16 changed drastically. But this is not because of any action 17 which our Board has taken, bCit the action which Dr. Trussel 18 and Doug Coleman of the Blue Cross have taken. That is, they 19 now ask us to give our advice on these institutions. 20 So we are now advising on the need for proprietary 21 hospitals, but as many people say, it is closing the barn door 22 after the horse has left. We have 60 now. The problem now 23 is to keep those 60 at that number. 24 I say we did studies. Actually, we did three major 25 types of studies over the years. We studied individual AGE-FEDERAL REPORTERS, INC. 61 Co STITUTION AVE N,W 53 I hospitals at their own requests and I would suspect we have 2 done about 100 of those in the past 24 years. Our batting 3 average has been very good, I think, on the individual hospital 4 studies. 5 We have had our failures, but we have had some 6 great successes, particularly in recent years. I' 7 Now, individual hospitals ask us questions. A usual 8 question, of cou-r,se, is: Should we add more beds, inaugurate 9 a new service or new program and so forth. We study those and write a written report which in 10 11 the old Hospital Council was sent to a committee which we called the Master Plan Committee. 12 13 Now, the Master Plan Committee was structured as a FR 14 combined committee of the Board of Directors and a group 15 of outstanding, for want of a better word, technicians. We ha@ 16 about a dozen people on that committee and about half of them 17 Were board men. George Bugbee was the last chairman of the 18 Master Planning Committee. We don't have it any more as such. 19 And we had men such as the Commissioner of Hospitals 20 of New York City. That is the man responsible for the operation 21 of the city's municipal hospital system. We had some knowledgeable 22 physicians who were engaged in research. We had Blue Cross 23 who is on it at this time -- Doug Coleman. Even before he was 24 on the Board, I think. But we had that type of person plus 25 Board people, knowledgeable people, who could give us technic 1 ACE-FEDERAL REPORTERS. INC. 61 CoNSTITUTION AvE N W. 0 C 54 I advice and Board people who could give us the reaction of the 2 community. 3 DR. ROREM: Any voluntary hospital administrators 4 on that? 5 MR. PETERS: Yes we usually had one who came usually 6 as a representative of the Greater New York Hospital Associati,Dn. 7 which is the trade association. In the past few years, it has 8 been Martin Ste:C@berg who, as you can well imagine, brings a 9 much broader approach than that of a hospital administrator. 10 The hospital administrators we have had on it have 11 been selected, not primarily because they were hospital 12 administrators, but because they could give us a broad picture 13 They were not there because they served one hospital or one FR 14 group of hospitals. 15 The Master Plan Committee reviewed the staff's 16 recommendation. The staff would write a report and bring it 17 directly to the Master Planning Committee at which time the Maj;ter 18 Planning Committee would discuss it at great length. And 19 George can tell you what great length means. They would ask 20 all sorts of questions because you had very knowledgeable peop e 21 on this committee who could ask very specific questions and gi-e 22 very specific reactions to the report. 23 In some instances, it was necessary to bring the 24 report back on a second or third occasion until it met the 25 approval of the Master Planning Committee. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N,W, W@5@"GTON 0. C. 55 I MR. BUGBEE: I never was sure whether it was the 2 function of the council, but I would say they were as detailed 3 and probably better than most consultants would do on a 4 community plan. They might have 100 pages in great detail. 5 MR. PETERS: The average report ran about 30 pages, 3ome 6 went to 100, some reports even went into more than that. 7 When-the Master Plan Committee approved the report, 8 and I might add that they rarely approved the report without 9 putting some sort of word change or something. They always 10 put their hand on the report. It never came out precisely 'as it went in. There was always some change, either a word 11 12 change or policy change or adding a recommendation or taking 13 out a recommendation, although in general, the sense of the FR 14 report always was the same as it went in. I don't know of 15 any time when the staff was completely overruled. 16 When the report was approved by the Master Plan 17 Committee, it went to the Board 'of Directors. The Board of 18 Directors, of course, then did the same thing to it, but with 19 not quite the elaborate discussion that you would get in the 20 Master Plan Committee. And this is the report that was sent 21 to the hospital. 22 Now, the biggest problem we faced then and still 23 face to some extent is how do you assure that the hospital or the group to whic h you are addressing the report will do what 24 25 Youwant them to do. And this was the great problem that ACE-FEDERAL REPORTERS, INC. 6 1 CONSTITUTION AvF N.W o@ C. ii 56 1 plagued the old Hospital Council. 2 We did have one great instrument and one which was 3 very helpful over the years. And that is, we with the Hill- 4 Burton agencies were working with the State of New York on 5 a contractual basis to administer Hill-Burton funds locally,.. 6 So a great deal of our leverage we had during the last @YS 7 of the old Council was based on this Hill-Burton leverage. 8 We could actuall-@ make specific recommendations on where the 9 Hill-Burton money in the five boroughs of New York City should 10 go and this gave us, as I said, a great deal of leverage. And there are many people who believe that many 12 hospitals asked us for studies merely to get on our good side 13 so they could get Hill-Burton money. I suspect this is true. i FR 14 It is certainly not a bad thing. It is certainly better to have a hospital come to us 15 16 for Hill-Burton money after we have made recommendations than 17 have them come to us cold. So we didn't look upon this as 18 such a terrible thing. We used it and I think we used it to good advantage 19 9 20 in many instances. For that, I would say some of our best 21 Hill-Burton grants came out of the fact we did do a study and 22 some of our worst came out of the fact we didn't know too much 23 of the hospital because we haven't had a chance to study them Ln 24 depth. 25 We had our failures, and let me tell you something ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AVE N W V,, - , , , ,, C, C 57 1 about the failures. You learn a lot by the failures. 2 One of our most persistent group of failures over 3 the recent years has been what do we do with the specialty 4 hospital of New York City. New York City still has a number 5 of specialty institutions. It has, I believe, four or five 6 well-known institutions which provide care for eye, ear, nose., 7 and throat patients. At least two of these are among the 8 greatest institutions of their kind in the world. 9 MR. BUGBEE: With the first physical plant. 10 MR. PETERS: Both of them have old physical plants. 11 'One goes back to the 1890's, the other goes back to the early 12 1900's. Both of these institutions have looked to the HospitaL 13 Council for advice. FR 14 One of them has come to us from, I think, the first 15 study the Council did in 1939. It was the New York Eye and 16 Ear Infirmary. And one of the last studies we did prior to 17 taking on the new Council was New York Eye and Ear Infirmary. 18 We did three studies,, and in all three institutions we urged 19 them to close down their present plant because it was inadequate 20 and to merge with another institution. The hospital still 21 exists independently, so you can-see how successful we have 22 been. 23 Another hospital, Manhattan Eye and Ear, was a little 24 smarter. They never officially asked our opinion, but they 25 constantly worked with Us. They never wrote that all-importart ACE-FEDERAL REPORTERS, INC, 26 1 CONSTITUTION AvE: N W. W..... @,, 0 C 58 1 letter to the Board requesting a survey. But their President 2 has worked very closely with us over the years. And again, 3 it has been a failure even though they have had the best of 4 instructions. They have taken every step possible to merge 5 with institutions, but have never been able to work out a 6 program of mutual satisfaction of both institutions. T 7 And the hospital now with the advice of one of the 8 outstanding coni-iltants in America is planning to rebuild next 9 door to its present location. 10 Those.have been two of our great failures. These 11 have been the knottiest problems because I say we are not 12 dealing here with the kind of hospital which we so frequently 13 deal with in Now York City -- that is, the inferior hospital. FR 14 Here, you are talking about great institutions, institutions oF 15 world leadership. And I don't think I am exaggerating to say 16 these are world leadership institutions. And this has been 17 the.problem. What do you do with the specialty hospital. 18 We have argued about this. We have long lived with this concept that there is no need for a specialty hospital. 191 20 Yet, when you get down to a particular institution, particularly 21 a great institution, you begin to wonder what do you do with 22 them. 23 DR. KLICKA: You succeeded with one, Women's Hospital. 24 MR. PETERS: Yes. 25 Well,, we succeeded, but it is still occupying its ACE-FEDERAL REPORTERS. INC. 261 CONST TUTION AVE N W. 59 1 present plant. Its plan is to merge, but until it actually 2 closes down, we haven't succeeded. 3 MRS. COLEMAN: It is being merged administratively. 4 DR. KLICKA: They are building a new building. .5 MR. PETERS: Yes. 6 We have succeeded with others, New York Orthopedic 7 and one or two others. It hasn't been all failures by any 8 means, but thes@two have been the knottiest ones. 9 MR. SIBLEY: You regard this as a problem because 10 this is criteria you are talking against. You set up a criteria 11 there shouldn't be specialty hospitals. 12 MR. PETERS: Yes, our Board says we shouldn't have 13 specialty hospitals. FR 14 DR. KLICKA: What if you had a children's hospital? 15 Do you think that Board would be against this? 16 MR. PETERS: Yes. 17 MRS. COLEMAN: Not adamantly so. Even though they 18 take a position, they are not married to it to such an extent they want to see good care stopped in order to prove something. 19 20 DR. KLICKA: Wouldn't you consider a children's 21 hospital a specialty hospital, but being a little different 22 really, than an ear, nose, and throat hospital? 23 MR. PETERS: A children's hospital is really nothing 24 more than a general hospital for little people. We are not 25 against all specialty hospitals.' We have certainly not ACE-FEDERAL REPORTERS. INC. 261 CONSTITUTION AVE N@W @ C 60 I resisted the movement of the hospital for special surgery. 2 Of course, they are affiliated with somebody else and 3 are working closely with New York Hospital, New York-Cornell 4 Complex. 5 What we are trying to do with each of the specialty. 6 hospitals is to get them to affiliate with another institution 7 and if and when the time comes to replace their plants to get- 8 some sort of geographical proximity. And here is where your 9 problem comes in Nw York City, Manhattan particularly, where 10 land becomes a very expensive commodity. 11 Well, that's the type of hospital we have had 12 failures with. One of the big problems is everybody hasn't 13 asked our opinion. Unfortunately, some of the greatest institi- FR 14 tions haven't asked our opinion, but these are great institutions, 15 and they have tended pretty much to do what is in the best 16 interests of the community. 17 Now, let's go into the new plarming agency, the 18 Hospital Unit Plarming Council of Southern New York. 19 DR. HALDEMAN: Joe, I hate to interrupt, but one or 20 two people have indicated that a break might be in order. 21 MR. SIBLEY: Jack, I don't think everybody knows 22 Jim Ensign from the Blue Cross Association who has come in. 23 (Whereupon., a recess was taken.) 24 DR. HALDEMAN: I wonder if we can get on with our 25 hog killing. ACE-FEDERAL REPORTERS, INC. 26 t CONSTITUTION AvE N W. 0, C. 61 I MIS3 JENKINS: Jack, that typifies you as coming fro 2 Oklahoma. 3 DR. HALDEMAN: Five years from now I won't say that$ 4 probably, after being exposed to New York. DR. ROREM: You will move up the animal kingdom and )e 6 sacrificed at some other level. 7 DR. HALDEMAN: I might even be seen with an umbrella- 8 Where I came fro-m', a man who walked down'the street with an 9 umbrella would get laughed off the street. 10 MR. BLUBEE: I suppose you will appear at the last 11 meeting with a Hamburg 12 DR. HALDEMAN: O.K., gentlemen. 13 MR. PETERS: Let me run down very briefly the organi,,,,a- FR 14 tion structure of the new Council and then let me give you some 15 background on the criteria that was distributed to you today ilk 16 this material because I think you might find it of some interest 17 in your work. 18 The new Hospital Planning Council of Southern New 19 York is a successor agency to the old Hospital Council. It 20 officially came into being last spring which makes it over a 21 year old now. It covers 14 counties, the five counties or 22 boroughs Of New York City, and the nine Outlying counties whict 23 take it out as far as Montauk Point on Long Island and a little 24 bit north of Poughkeepsie in New York. It is the southern tiez 25 of counties in New York. ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE . N,W. WASI'A@ION, 0. C, 62 I There were many problems in structuring this, and 2 there is nobody more qualified to tell you about the problems 3 that were faced in this than George Bugbee because he was the 4 chairman of the group that brought this about. For your information, Georgq, there are still some 6 unresolved problems. 7 MR. BUGBEE: I know. 8 MR. PETF.RS: Particularly with relationships of 9 one of the subgroups in the area which is constantly giving 10 indication they.would like to break loose and go out on their 11 own, saying they would like to plan-for the 2 million people 12 in their area which makes a pretty good sized planning area., 13 by the way, 2 million people. But they originally consented FR 14 to join us, and one of the big problems in the immediate future 15 is going to be how can you work with these people, still givin,,r. 16 them some degree of autonomy in their local affairs and still 17 bringing them into the whole regional complexion. 18 This is going to be perhaps one of the most difficult: 19 organizational problems that the Council is going to face in 20 the coming months. But the new Council, as -I said., covers 21 14 counties, and it was structured so we would get representation 22 from the entire region. 23 We have a Board of Directors of 43 people, 36 of whcxi 24 are elected and seven are so-called ex-officio members who 25 represent county commissioners of health, county commissioners ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W, 0 C, 63 1 of welfare, and the various commissioners in New York City. 2 It is much larger than the old Council. 3 The old Council Board, as I recall, was about 30. 4 This is 43. Although it is very encouraging to say that the 5 attendance even though some of these men come from 150 miles 6 away, has been remarkably good. I certainly can't say that th! 7 Board is too,big in terms of attendance., We certainly are 8 getting 30, 31, jeople at.every-meeting, morelthan that. And 9 some of the one,-- who don't ,come are the ones locally. 10 In fact,--the,ones from outl;of thecity have been ii 'very diligent in attending,,,and, .we, certainly have ,no problems 12 in that. 13 As to whether the Board is too big to managed Ao far: FR 14 it,,,has,been no problem, b ut :,it. - is :,r-c)nceive k:th4kt. i5 P:ri* lem,irk .the f tk@ure. W-P- hadAk. master. p@.-lan,; tommittee.,.bef ore 16 whic@hliacted asL sort.@of a,n,@ executive COmmitt,,Oe "in, -t;l'lat it;,;revieiFed 17 all - the- -studies and made recommendations Lprior to giving it -to ,8 the Board.. That.,committee h4A.Officially been abandoned, but 19 in its place, we have-set uP,One:Of,a prpposed,four.committees 20 the Facilities ,plarming Committee whir-hwill represent,one of 21 the maj.or functt@s,,..of the Counci@$,,-.4nd this-,wi.11 be 22 @Ommitt;ee k s xp w:Lt:,h -prob leck -. o-e ans.ion,,,.-. a 23 f f illiation, ancl.,,,so .,f orth.@1% 24 t@ We,, Plan tP., -a et up three,,.other, Llommi-ttects@,,.:and three 25 otheroperat-ing@: n Ss ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE N W, 64 1 and administrative services. 2 MR. SIBLEY: Would you define each one a little more' 3 MR. PETERS: Sure. 4 Facilities planning will deal with the problems of 5 construction, expansion, location of hospitals in Accordance. 6 with measures the committee needs. They will probably be pretty 7 much in the entire area te old Council stressed. That is, 8 resources, physical resources, how you distribute them and so 9 forth. This is nothing more than an expansion of our old role 10 We are hoping to get into the whole area of medical 11 services. Here we are thinking in terms of the problem that 12 Ann Coleman raised, the problem of quality, quality of medical 13 care, which is a bit of a problem in New York City bec ause in FR 14 New York City, you have,, I won't call it unique, but certainly i5 its-dimensions are greater. You have some of the world's 16 greatest institutions side by side with some hospitals which 17 wouldn't.pass muster in some of your rural areas, even. You 18 have got a lot of small hospitals. 19 Rufus said the smallest hospital was 119 beds.- I 20 wish we could say that in New York City. We can't say that. 21 We have a lot of them 80, 90, 75 beds. A lot of these are 22 proprietary hospitals. Particularly in Brooklyn, there are 23 a good number of small voluntary hospitals. Some of these 24 are good institutions, some of,them are not so good. 25 A large number of the proprietary hospitals have not ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AVE., N.W. W ...... @,, D@ C. 65 1 even met the standards of the Joint Commission on Accreditaticn 2 of Hospitals. And even though they have passed those standards$ 3 it still leaves much to be desired as far as good hospital 4 care to the community is concerned. 5 We are concerned about this, and we are also concerned 6 about another problem which Rufus doesn't seem to have. And 1 7 that is the problem of medical staff appointments. I wish we- 8 could say that every doctor in New York had the appointment he 9 wanted or has an appointment. 10 DR. ROREM: Not the one he wanted. They have got 11 some. 12 MR. PETERS: Some appointment. 13 We found on the studies we have done that 70 per FR cent of all the doctors in New York City do not have a voluntary 14 15 or municipal hospital appointment. 16 I mean, 70 per cent have and 30 per cent do not have. 17 Seventy per cent have a municipal or voluntary appointment and 18 30 per cent do not have. 19 This does not say that 30 per cent do not have. 20 proprietary appointments or do not have courtesy appointments. 21 We have no way other than contacting each doctor individually 22 of knowing this. 23 At the present time, the medical directories in New 24 York State do not give courtesy appointments or proprietary 25 @"O$Pital appointments, 'Although we have been led to believe thal: ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AVE., N.W. WASHINGION- 0, C- 66 I the new directoiywhich comes out this year will give proprietary 2 hospital appointments. So we will get a little better picture 3 this year when we get the new directory in. 4 So we have the problem of what do you do with these 5 30 per cent of the doctors who do not have voluntary or 6 municipal hospital appointments. This is another problem which 7 we hope the medical services division will be dealing with, 8 and the whole p@ablem of medical education and so forth would 9 be part of the function of this medical services division'. 10 together with the problem of utilization, studying of utiliza- 11 tion, under utilization, overutilization. 12 We also hope to set up a Division of Financial 13 Planning, and this will entail bringing together, coordinating FR 14 many of the activities of other agencies which are presently 15 doing some work in this field. With the exception of Blue 16 Cross which is responsible for 17 counties, 14 of the 17 count-..es, 17 there is nobody in the area, in the region, that collects 18 data, financial data, or autopsy data from all the hospitals 19 in the region because we have three major groups of hospitals. 20 We have proprietary hospitals which pretty much act on their 21 own. We have a whole complex of governmental institutions of 22 which the largest is 18 or 20 hospitals operated by the New 23 York City Department of Hospitals. And then, we have five 24 State hospitals which are all mental in New York Cityand a 25 Couple more in the region. And then,, we have a large n@er o. AGE-FEDERAL REPORTERS, INC. 61CONSTITUTI NAv N,W. WASAIN6TONO D. C: 67 I government institutions which are beyond this that we have no 2 relationship to speak of at the present time. 3 MR. BURLEIGH: To what extent are the proprietary 4 hospitals a relatively regional 5 MR. PETERS: The proprietary hospitals have been 6 with us in New York City since the 19th century. And prior to 7 the onset of the Depression, there were more proprietary 8 hospitals than there are now in terms of number of hospitals. 9 There are less hospitals now, but more beds. A good many of 10 these have come about since World War II and even a great 11 flurry in the past three or four years. 12 Part of the flurry of proprietary hospitals in New 13 York Citytook place because of changes in the zoning laws in FR 14 New York City And the date was set up ahead. So in order to 15 get under the wire, a great many of these plans were filed to 116 get under the deadline so they could make best use of the 17 space prior to these requirements. 18 So you have had, I would expect, around 1,000 built 19 in the past few years, but around 1,000 proprietary beds in 20 New York City. 21 MRS. COLEMAN: But the point is really what caused 22 it, not the zones -- that was just the timing but what 23 caused it, we had a growth of population in one particular 24 borough without a corresponding increase in voluntary hospital 15 beds. ACE-FEDERAL REPORTERS, INC. 2 6 1 CONSTITUTI(ON AtE N@W W4SHTNGTON. 0. C. l@ 68 I DR. KLICKA: This is Queens? 2 MR. PETERS: The Borough of Queens, yes. This is tha 3 most rapidly growing borough of the five in New York City. 4 And there were a small number of voluntary hospitals, none of 5 which were very strong economically. 6 MRS. COLEMAN: Only one of which was very good 7 medically. 8 MR. B IGH: I was wondering about the absence 9 of staff privileges in voluntary hospitals. - 10 MR. PETERS: There is no question but this has something 11 to do with it. flow you measure it, I don't know. This has a 12 great deal of bearing, but I find in many institutions, the 13 ones in private are also on voluntary staffs in the same area. FR 14 MR. BUGBEF.: It could also be with a lot of foreign 15 professionals and this is sort of the European pattern with the 16 big teaching hospitals. The big hospitals in Hanhattan have 17 50 per cent in wards and free cars. There isn't much room for 18 private patients in them. It is the sort of nursing time thiqr 19 that they have on the Continent and England where I guess it 20 goes back to that part. 21 DR. HALLDEMAN: How much of it is due to the fact thal: 22 in the suburbs, the voluntary effort just @n't caught up? 23 MRS. COLEMAN: That's certainly true in Queens. 24 MR. PETERS: Queens up until recently was a suburban 25 type of borough of New York City, and that's where you have h&41 ACE-FEDERAL REPORTERS. INC. 61 CONSTITI'TION AVE N.W 69 I your growth because your population has grown spectacularly 2 with the small number of voluntary hospitals, but poor financial 3 condition, couldn't move fast enough. 4 And in this respect, the proprietary hospitals, 5 for all we have said against them, have had one great virtue, 6 and that is they have met a need and met a need very rapidly 7 because you can get a proprietary hospital built and occupied_ 8 in two years. Y6u can't even get the committee of a voluntary 9 formed and working in that time. 10 DR. KLICKA: Yes,,you can. 11 MR. PETERS: But it Queens it wasn't very easy to do. 12 Queens is a peculiar borough. It is a middle-class borough. 13 You go through the entire borough, you see very little wealth. FR 14 It is a low middle-class borough. Some areas have high middle 15 class, but there is no real money in the borough of Queens likB 16 there is in some of the older sections of New York City such 17 as parts of Brooklyn and Manhattan. 18 MRS. COLEMAN: And it was probably overbedded with 19 municipal beds so that the poor population could be taken care 20 of in municipal hospitals. 21 MR. SIBLEY: I am going to lead you back to financial 22 planning because I am interested in what you people see as 23 your role in financial planning in New York City. 24 The Commissioner of Insurance has required you to 25 review Blue Cross, hasn't he? ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AVE., N W@ 70 I MR. PETERS: Yes. We will get into the whole problem. 2 One of the major things we see ourselves doing 3 immediately is capital financing which is pretty much akin to 4 our present role of planning, but we are hoping to get involver 5 as all regional councils are expected to get involved in New 6 York State in judging the adequacy of Blue Cross rates, Blue 7 Cross payments to the hospitals and all the other things that_ 8 so-called studi6i of efficiency, studies'of the cost of 9 hospital care and so forth which we have been instructed to 10 get into by the.gcvvernor's administrative order. 11 MR. SIBLEY: Are you going to do this for the State 12 Welfare Department as well? 13 MR. PETERS: We @haven't worked anything out in this FR 14 area at all. This is one area we have merely set down as a 15 potential division. The relationships are extremely complex. 16 You have United Hospital Fund which represents 80-some voluntary 17 hospitals in the five boroughs of New York City, but does not 18 represent voluntary hospitals in the other nine counties. 19 You have the Department of Sodial Welfare which collects finan(ial 20 data on all hospitals for which the governmentpays for care, 21 which in this instance is voluntary hospitals and also municipal 22 hospitals. They don't collect any material from proprietary 23 hospitals so far as I know with maybe one exception which 24 does take care of some government indigent patients. 25 DR. ROREM: You say, "proprietary hospitals can ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE., N.W 7 1 1 accept indigents." 2 MR. PETERS: It so happens Manhattan General does. 3 DR. ROREM: Nothing in the statute of limitations 4 that avoids it? 5 MR.,PETERS: This was raised at the last Board 6 meeting, this very question. There is nothing that prevents 7 them from taking care of indigent patients if they are given 8 to them. We have' to get the approval of the Commissioner of 9 Hospitals and so forth. 10 We have financial data collected by the United 11 Hospital Fund for voluntary hospitals in five counties., and 12 not all the voluntary hospitals, only those that are members 13 of the Fund. FR 14 You have the Department of Social Welfare collecting 15 financial statistical data for all the voluntary hospitals 16 which accept city charges and mental institutions. But then, 17 you have got Blue Cross which collects financial data from all 18 the hospitals. So that is the only source at the present time 19 of financial data from all the hospitals in the 14 counties. 20 The big problem of the new Council would be when 21 it sets up its division,, how much are we going to do and how 22 much are we going to have to take from somebody else. ObviousLy. 23 you have got people doing it. Blue Cross has got a legal 24 responsibility. They collect data anyway for their own operat on. 25 So you are going to have to work with Blue Cross., You are-goiig ACE-FEDERAL REPORTERS, INC. 261 COt4STITUTION AVE . N W W41HI'@'@l, 0. C. il 72 I to have to work with the Department of Social Welfare and with 2 the United Hospital Fund which, again, has a chartered 3 responsibility to do certain work in this field. 4 They would have to change their.whole role if they 5 didn't do this. So it is going to be a very delicate arran'geam!nt. 6 Fortunately, we have very good working arrangements 7 with all these groups, particularly Blue Cross, which finances- 8 us to a tune of ine-third of our annual operating expenses. 9 United Hospital Fund finances us to the tune of about one-SiXtIL lo of our operating expenses. So you have a working relationship ii 'there. It is a matter of who is going to do what and how. 12 Certainly, we are going to have to do substantially 13 what we have done in the past but how far we are going to go or .9 FR 14 this is a matter of development and evolution. It is going to 15 be a slow process. 16 The medical service division, on the other hand, is 17 one.that our Board has given the highest priority other than i8 our present activities, getting involved in that area, quality, 19 standards of care, medical staff appointments. 20 And the other would be administrative services. This 21 one has been tabled. This one is the area where so far as the 22 official position of our Board of Directors is concerned will 23 await further discussion. And this is not anticipated this woull 24 be started for some time. 25 MR. SIBIEY: How did that one get included? What ACE-FEDERAL REPORTERS, INC. 26 1 CONST TUTION AVE. N@W I WA.HIIN@ION D. C. 73 1 was the thinking behind it? 2 MR. BUGBEE: I think the whole question of the economics 3 of operation. Also, I think under there is concern with 4 teaching, nursing, and all kinds of educational projects and 5 the hope for a general drive on economy or, at least, a medium 6 for use by the hospital. 7 MR. PETERS: It gets in the whole area of nonprofes@ 8 sional staffing dnd professional staffing other than doctors. 9 Certainly, you have to take into consideration your planning 10 procedures. 11 MR. SIBLEY: I want to get on this because it is f or 12 a purpose. These are all considered in your agency to be 13 planning, you see. This is a very broad definition of planning. FR 14 MR. BUGBEE: It is Trussel's definition. You may 15 recall it is his planning and review council. And the review 16 assumes operations and quality. 17 I think there is one other thing that has some interEst 18 here and that is the Blue Cross is planning, not only to 19 support it, but probably to contract with this agency. And 20 I would guess that probably they are patterning it to some 21 degree after what you are doing, Jack, in Detroit, but with the 22 thought that enforcement of economic sanctions against construc- 23 tion and various other things could better be handled by Blue 24 Cross contracting through this agency than Blue Cross trying to 25 do it itself. ACE-FEDERAL REPORTERS. INC. 261 CONSTITUTION AVE: N.W. V, @SH?NGTON@ 0, C. 74 I They have talked about contracting in support up 2 to half a million dollars. I don't know whether it will, but 3 it would make possible the staffing of some of these other 4 ventures'if they do. 5 MR. PETERS: At the present time, Blu'e Cross has 6 guaranteed us $100,000, but not to exceed one-third of the 7 total of our contributions from all sources, including themselves. 8 So.last year we lot $95,000 or some such figure, $94,,ooo. 9 So we are pretty close to getting the 100 per cent contribution 10 from Blue Cross-as they presently see it,, but this is only 11 an interim contribution. It is not for all time, we hope. 12 MR. BUGBEE: I think the other unique thing is you 13 get about $30,000 from the State as your function at the Hill- FR 14 Burton agency. 15 DR. HALDEMAN: Jack, did you want to speak? 16 MR. COUSIN: Yes. I have a question. 17 Because what you are planning to do there in some 18 ways is what we are planning to do except you formalize it a ig little more than we have and you are apparently going into it 2o a little deeper than we have. 21 MR. PETERS: We are only formalized in our paper, 22 Jack, so far. 23 MR. COUSIN: This may be an embarrassing question, 24 but 25 MR. PETERS: If it is so embarrassing., I won't answ!r ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W W _ A INGTO.N 0, C. 75 1 MR. COUSIN: What does this do to your other Hospita,- 2 Council in New York? 3 The reason why I am asking it is because my organiza.. 4 tion does planning, but it is also the trade association. 5 And while some of our administrators feel that we should have 6 planning in the trade associadDn separate, our public represenl;a- 7 tives who are the ones that,pretty much control us feel that we s are better off i@ the long run in doing planning and all the 9 trade association work because you can't divorce the two. 10 They tell me what we are really doing is health ii economics, not planning. 12 MR. PETERS: First of all, I am on the board of the 13 Greater New York Hospital Council. The Executive Director of FR 14 the Council is automatically ex-officio member of the board 15 and the association. 16 We don't see any real conflict. First of all, they 17 are admittedly the spokesman for the voluntary hospital system. 18 It is their job to see that the interests of the voluntary 19 hospitals as a group are promulgated. Our Jo b is to look at 20 the thing from a different point of view, the point of view 21 of the community. 22 This may not be the same as the interests of the 23 voluntary hospital either collectively or individually. Fortunate- 24 ly, it has been, but it is not necessarily the same thing. 25 We look at things differently. We don't go down to ACE-FEDERAL REPORTERS., INC. 261 CONST'TUTIONAVE N.W W@ @,NGrot,. 0, C. 76 I the city hall nor to the State chambers to lobby for passage 2 of a certain bill or lobby against the passage of a certain 3 bill like the association does. We are not involved in the 4 whole problem of unionization of hospital employees, which they 5 are. We are not involved in seeing at the present time the 6 voluntary hospitals get the most advantageous raise for 7 Blue Cross when the third party pays. 8 We will be involved in rates, but from the point of 9 view of whether the community is getting the best value for 10 its money, not in terms of whether the hospitals are getting 11 the most they can from the agencies. It is a different point 12 of view, and I think there is room for both. 13 MR. BUGBEE: There is another thing, Jack. This is FR 14 as touchy as anything, and the Greater New York was very 15 concerned with this development, but the fact remains they 16 have never done anything but representation. They have never 17 done economic activities or joint purchasing or any of the 18 things that are conceived to be a Council function except 19 representation. And maybe there is a role for them in represeiita- 20 tion in relationship to Council, but they were worried to 21 a degree it pre-empts part of the assignment that should have 22 been theirs. 23 MR. PETERS: George, since you left., the Greater 24 New York Hospital Association was studied. Like most hospital 25 they got their study, too. So they brought in an outside ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE , N.W W@5-INGTON 0 C 77 1 consultant to look at what the role of the Greater New York 2 Hospital Association would be. And even though they are 3 structured in a very complex way, the consultant recommended 4 a very complex structure. Actually, there wasn't quite as mucli 5 conflict as one would think would arise. 6 Sure, they would have a Division 'of Financial Planniiig. 7 But this is purely from the point of view of representation to. 8 gather material from the hospitals to present a brief to the 9 city or to Blue Cross or to any other third party for lo getting better reimbursement patterns for the voluntary 11 hospitals which they represent. 12 They are talking about studying personnel, but their 13 1study of personnel is going to be a little different than ours, I FR 14 They are talking about salary, salary and wage procedures 15 policies regarding employment, collectivization so they can 16 work with unions because as of July Ist, the hospitals of 17 New-York City are no longer exempt. So they have to live with i8 Iunions and like it as of seven or eight days ago. So there is 19 a different type of thing. 20 Even though they are expanding just as we are expanding, 21 I still see very little conflict except in this one area of 22 administration. 23 MR. COUSIN: Which you have taken. 24 MR. PETERS: Which we have taken, but partly because 25 of this because this is a very, very delicate area, and this ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE . N,W W4@@'ll,r@7, 0, C. 78 I is the area where we are going to have to, over a period of 2 time, our committee has recommended we have joint conferences 3 with the Greater New York Hospital Association and United 4 Hospital Fund which also does work on administrative research. 5 For example, on methods of improvement and things 6 like that which Charlie Roswell has done with Government aid. 7 There is where your great area of conflict may be. This is th@ 8 area where it is-conceivable we may never be operate. 9 MR. SIBLEY: Joe, we are already into this area of 10 administration, and this is why I am particularly interested 11 in how we look at the images of our job, which is really what ,2 you are describing, how you compare your image with the imag e 13 of the associadm. And we got caught into it. FR 14 I think for a number of reasons,, but the one that caiie 15 out was when Frank Gromer was president, he insisted there musi: 16 be a code of conduct of hospitals which was in the organization 17 management end of things. And we have developed now what we 18 call organization and management standards which are going 19 to our House of Delegates in New York in August. 20 We realize that they are going to be revised many 21 times and worked over many times, but they are now in very 22 definitive form, very specific. There are about five general 23 headings and about seven to tan under each one. But we don't 24 know how to administer them., and we have been discussing this. 25 Our Board discussed it at considerable length. You ACE-FEDERAL REPORTERS, INC. 261 CONST TUT ON AvE N,W 0, C. 79 1 see, this was a promise that Frank Gromer made to the 2 Blue Cross Association that the quid pro quo was between 3 hospitals and Blue Cross. And I think it is probably the 4 same with the insurance commissioners and welfare departments around the country that the hospitals have to demonstrate,,,or 5 6 there has to be some mechanics of demonstrating, that they are 7 doing the things, they are being well organized and well 81 managed. That :Ci,, if they then proceed to say that good 9 patient care gets some good organization and good management, 10 which I think we accept as a basic premise, although we are 11 not s ure that this is correct. 12 So we have moved into this field rather gingerly 13 ourselves because we are not sure, but we felt we couldn't waii. FR 14 any longer and with the Trussel report kind of activity -- that: 15 -is, if you follow out the concept of that report. And as far 16 as I am concerned, in my thinking., these are all facets of the 17 more general problem that hospitals, not being in the profit- 18 making activity, have to find mechanisms for demonstrating the3, 19 are using the money which comes to them which is, in a sense, 20 in trust, in trust for Blue Cross or in trust througitaxes, 21 or in trust through insurance or in trust whatever the mechanism 22 is - 23 We answer that question we are taking the necessary 24 steps to use this money wisely, and this is basically, I suppose, 25 what You are set up to do. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE , N.W C 80 I MR. P.ETER3: By the way, this is not to say that 2 the Hospital Council has had blinders insofar as these other 3 aspects of hospital planning are concerned. I think if you 4 look at the study which we prepared a few years ago -- about 5 a year or two ago -- on the so-called municipal-volunta@ 6 hospital relationship study where we analyzed the role of the 7 voluntary and municipal hospitals in New York City, which 8 came out as a 600-page book in the beginning of this year, 9 you see, we at that point had come to the awareness that we 10 just could no longer think in terms of facilities and services. II- We had to talk in terms of organization, administration,, 12 availability of personnel, standards of care, all these things 13 finances. FR In fact, if you look at that book, you find that more 14 15 than one-third of that book deals with finances. The role of 16 government money,, voluntary money, philanthropic sources and private payment goes to one-third of that book over and over 17 18 again. 19 We also talked about the ability of the municipal 20 hospital system to administer itself properly, the organization 21 of municipal hospital system, and how it should relate to the 22 organization in voluntary hospitals. And we talked about 23 all these things, and this was the first time where we officially 24 really got way beyond our previous limited scope. 25 Do you think so, George, when we got into this ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W, 81 1 municipal voluntary, maybe not to live with it, but maybe 2 accidentally. We got into all the areas. 3 DR. ROREM: I would like to ask a question, technical 4 question. 5 Did I understand you to say the municipal hospitals 6 do not have membership in or are not represented by the 7 Greater New York Hospital Association? 8 MR. PEFERS: Yes, they are. 9 MR. BTJGBEE: Proprietary are not. 10 MR. PETERS: Municipal are, but actually,, if you lool-. ii at the Board of Directors of the Greater New York Hospital 12 Association, you see that the Commissioner of Hospitals is 13 like I am, an ex-officio member of the Board,, and he is the FR 14 only administrative hospital person that is on that Board. 15 So even though there are 18 hospitals, 18 hospital 16 superintendents, they play a very negligible role in the polic5- 17 making of the association. So even though they are members, i8 they come to all the general meetings, but as far as the Board 19 of Directors, as far as holding office is con.cerned, historically 20 the municipal hospital executive had played no role. 21 DR. RMM: Except their primary concern is with the 22 voluntary hospital. 23 MR. PETERS: No question. The other ones don't even 24 pay the same dues. 25 For want of a better word, they would be an associate ACE-FEDERAL REPORTERS, INC, 261 CONSTITUT'oN AVE , N W W4'1 0. C, 82 I type of membership because the problems that the Greater New 2 York Hospital Association deals with are primarily the problems 3 in the voluntary hospitals. 4 DR. HALDEMAN: Is there an association of proprietary 5 hospitals? 6 MR. PETERS: Yes, there is at least one. There is 7 one, anyway, Association of Private Hospitals., Inc. 8 MR. SI-BLEY: Are you on their 'Board, Joe? 9 MR. PETERS: No. but they are on our Board. And 10 George can tell,you about all the travail that went through 11 on that one. They are on our Board, and I may say that I feel 12 sorry for Dr. Berson who represents it because when the vote 13 comes 40 to 1. he has long since now just stopped and sits FR 14 and listens. 15 All it does, really, in many respects, is assure 16 that they will know what we are doing, not that we know what 17 they are doing. In other words, any time we prepare a document, 18 you can be sure that the Executive Director of the proprietary 19 hospitals has a copy of it on his desk the minute it is off 20 our press because we send it to our Boardman. He probably 21 gives it to him. So it is a one-way communication at the 22 presenttime. 23 But certainly, I would say that it was a wise move 24 to bring him on. If you are going to try to get them to upgarle 25 their standards, you ought to at least let them have so= voice ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE: N W, 0, c 83 1 in it because one man can't dominate the group. Hopefully, 2 we try to let him see the broad picture and are hopeful he 3 will bring this back to his members. 4 Let me get to the criteria because this is a good 5 point. 6 DR. KLICKA: One question before you do that. Either 7 I missed it or you didn't make it clear. I think I missed it. 8 In all-of this structure., are you talking about 9 planning as it relates to hospitals, or as it relates to 10 total health facilities which include nursing homes? 11 MR. PETERS: Total health facilities. 12 DR. KLICKA: And long-term care facilities,, all of 13 these things? FR 14 MR. PETERS: We have done a little bit of work in 15 nursing homes, and we occasionally have some relationship with 16 other types of institutions, but this has been more accidental 17 than deliberate in the past. 18 Dr. Coleman, who was our Association Director prior 19 to going to Johns Hopkins was farmed out for a period of time, 20 working with the Department of Mental Health Council which 21 represents the Department of Hospitals, Health, Welfare, and 22 Mental Hygiene, in New York City. And he did some work on nursing home facilities. And he came out with a figure that 23 24 in New York City we need approximately 15,,OOO more nursing 2s home beds by 1970. ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AvE N.W, 84 I So we have some guideposts in this area to work 2 with. This was done, not by the Council as a council, but 3 one of the staff members loaned out. As I recall, that wasn't 4 even approved, didn't even go to our Board of Directors, his 5 report. It went directly to the group, but we have used it, 6 and it does represent a landmark which we can work under. 7 We need more nursing home type facilities in New York City, 8 and we have been working a great deal with hospitals on this 9 trying to get individual hospitals to expand their scope. lo And I suspect we are going to get involved in other things. 11 We have to get involved in this. We certainly can't limit 12 ourselves to the general hospital. 'L3 If we did, we would be limiting ourselves to only FR 14 just one segment. It is hoped we can get more involved in the 15 whole problem of care for the mental disease patients,, care 16 of the aged. We find ourselves getting working time with 17 homes for the aged. 18 Mrs. Coleman worked with some last year., as I recall 19 DR. KLICKA: I am going to ask you a ridiculous 2o question. Does anyone have the opinion you are extending 21 yourselves too far and trying to do too much in your organiza- 22 tional structure? 23 MR. PETERS: I would suspect there are. 24 DR. KLICKA: I am asking a serious question. 2S MR-PETERS: Seriously, first of all, I told you about the,. ACE-FEDERAL REPORTERS, INC. 61 CONSTIITUTION AvE., N W. W@""G,O, D. C, 85 1 fact many believe we are trying to extend ourselves too far 2 geographically. 3 DR. KLICKA: No, I am talking about -- 4 MR. PETERS: That's one area. I am sure that I 5 could think of at least one member of our Board of Directors 6 who must think we are out of our mind getting involved in this 7 medical services concept. He has very often spoken up that 8 the problems of medical care are the domain of the medical 9 society and doctors that practice medicine. And since we have 10 very few doctors on our Board that even touch a patients therefore what right do we have to make pronouncements about 11 % 12 quality of medical care? This is a medical problem, and you 13 laymen, no matter how well intentioned you are, should get FR 14 away from this. And he has spoken this out at every single 15 Board meeting he has been at. 16 I would suspect there are one or two other members of our Board who are also physicians,, and I might even say 17 18 one or two of our lay members, who would say he is perfectly 19 right. This is one area where we know there is some controversy, 20 at least some:doubts, in the members of our own Board of 21 Directors. 22 I know that there is at least one member of our Boar@ 23 of Directors who thinks -- at least one, maybe more than one -- 24 the idea of the whole new Council, its structure, its organiza- 25 tion, its concepts, its geographic responsibilities, is all wet. ACE-FEDERAL REPORTERS, INC. 61 CONST TUTION AVE N.W. WASHIINGTON, D. C. 86 i And he will not come, he doesn't come, to any Board meetings. 2 I would say one of our best Boardmen, one of the men who 3 could make some real substantial contributions. 4 So I would suspect there are many individual 5 hospital administrators who would say that we are out of our 6 minds. Particularly ones we leave the area of facilities and 7 get into anything beyond facilities, there are a lot of people 8 I am sure who ar-e going to resist us. 9 We haven't met that resistance officially because we 10 haven't gotten into these areas as yet, but I suspect we will 11 get it. And I don't think the committee, when they formed 12 this Council, ever thought it was going to be an easy job. 13 They realize the problems,, and it is going to be difficult. FR 14 DR. KLICKA: O.K., you answered it. 15 DR. HALDEMAN: Could we go on to the principles? 16 MR. PETERS: We got involved in this criteria. 17 As I say, we know quite a bit about New York City. 18 After all, we have been working in New York City for 24 years, 19 but to be completely frank, there are a lot of things we 20 don't know. But we know quite a bit about it. 21 As of a year ago, we knew nothing about the eight 22 counties Outside of New York City. So one of our first jobs, 23 as I said earlier, was to broaden our knowledge of the 100-odd 24 hospitals outside Of New York City to get some idea of all the 25 things that were happening that affect medical care and ACE-FEDERAL REPORTERS, INC. 261 CONST TUTION AvE N.W. C@ C. I 87 1 hospital care outside New York City. 2 Quite apparently while you are getting this information, 3 you still have got to make decisions. If an agency is going to) 4 wait until it gets all the facts and is not going to make any 5 decisions until all the facts are,in, he is not going to do 6 anything. We have got to plan regardless even with our 7 limited knowledge. 8 Once w@ were organized, people 'started asking us 9 questions, and we had to give answers to these questions. So 10 it was quite obvious that we had to have some broad outline 11 criteria to guide the Facility Planning Committee and the 12 Council as a whole in making decisions both for New York City 13 and for the other nine counties outside the city. FR 14 So we had criteria, one-page criteria on New York 15 City which we assembled about two years ago. And this, we 16 were operating under for the past two years. When we became 17 a new regional council, it became quite obvious that we had 18 to broaden our principles to take into account the other nine 19 counties and the differences between the other nine counties 20 and New York City. 21 As I said, the other nine counties have an expected 22 population growth. New York City is expected to remain static 23 So we were told to expand our principles for New York City to 24 cover nine counties. 25 There was some thought that perhaps we would have to ACE-FEDERAL REPORTERS, INC. 261 CONST TUTION AVE . N.W. WASH(INGTOPI, 0. C. 88 1 have two sets of principles., one for New York city and one 2 for the expanding nine counties. We thought that it would be 3 possible tddevelop a set of principles which would apply to 4 the region as a whole, it was no longer feasible to try to make 5 distinctions. We ought to start thinking as an integrated 6 region rather than as three separate groups within the region. 7 So staff devised these criteria. And as you will notice, they 8 are very general:.- 9 I suspect there is nothing in here which is new with 10 perhaps one exception, and that is the very strong position that 11 was taken on the fact that every hospital should attempt to serve 12 all income groups within the population. This is quite a 13 dramatic jump in New York City because, as I say,,we have FR municipal hospitals to serve the indigent. We have proprietary 14 15 hospitals which serve the pay patient or Blue Cross patients. 16 And we have voluntary hospitals which serve all patients, but 17 as George pointed out, they carry a large share of the indigene: 18 patient load in the city. 19 This is not true outside the city because there are 20 no local government hospitals outside New York City. There 21 are one or two, but they are a very small group compared to 22 New York City. 23 The problem was we felt that to perpetuate hospitals 24 with such limited functions in serving limited segments of the 25 community made our planning a great deal more difficult and ACE-FEDERAL REPORTERS, INC. 6 1 CONSTITL,'TION AVE N W@ 0 C 89 I probably resulted in a need for more beds if you are going to 2 start splitting the community up into small groups because you 3 havelost one element of flexibility automatically by having 4 hospitals which take care of the pay patient and hospitals 5 which take care of the,poor and hospitals which do both because 6 these populations are not static, they change. As the 7 economy changes, the number of people who require care in 8 municipal hospicals, at least theoretically, changes. And what 9 happens in New York City is we find, particularly as areas 10 change, an area could be a middle-class area today., ten years 11 from now could be a blighted area or alum. It could have 12 enough hospital beds,, but supposing all these hospital beds 13 were proprietary hospital beds? Who is going to take care of FR i 14 the needs of tlwse changed areas? 15 or, conversely, suppose the area was a slum and 16 through redevelopment became a good are& and you had a municipal 171 hospital servi6ing it. Who is going to take care of the needs 18 of the private patients in that area because, by law,, the 19 municipal hospitals are limited primarily to care for the 20 indigent, although they can take emergency cases for pay 21 patients. 22 So we wanted to recognize two problems, the problem 23 Of changing economic conditions and changing community conditions, 24 the declining neighborhood or area that was changing for bettei- 25 or for worse. So we felt in our future planning, we should ACE-FEDERAL REPORTERS. INC. 61 CONST'TUTION AVE N W@ W45H"Nc"@, D C 90 attempt to have hospitals that would service whatever type of 2 patients were there at the time. 3 In other words, hospitals that would take care of 4 the indigent and the pay patient in various proportions, depend- ing on the need at the time. 6 So this, in essence, really meant that we were going 7 on record as being against private hospitals. 8 MRS. C'OLEMAN: And municipal. 9 MR. PETERS: And municipal, but you notice on page I under "flexibility", we put a little out on municipal hospital; 10 11 by saying, "It is recognized that, because of local traditions 12 and statutory policies, there are often marked differences in 13 the roles of government institutions in servicing various FR 14 groups within the population." 15 We left a little loophole there, although I might say we have been pretty much in the past few years discouraging, 16 17 and.in this, Dr. Trussel shares our views,completely, the 18 addition of more municipal hospital beds in New York City. 19 DR. HALDEMAN: Is there any move to open up 20 municipal hospitals to paying patients? 21 MR. PETERS: There has been talk about it as far bacb 22 as the hospital survey of New York which was in the ear ly 23 130's. One hospital in New York city, Sydnum Hospital., which 24 was a voluntary hospital in the Harlem area which face d great 25 f inanci-a- 1 dif f iculties . and in the late -40's became a ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N@W. W.SHIN<"rot, 0, CI 91 I municipal hospital with the stimulation that probably 100 per 2 cent of its 200 beds would be for private patients, but this wits 3 a recognition of the peculiar problem facing the Negro doctor 4 in the Harlem area. DR. HALJ)EMAN: I am thinking of the situation in-' 61 Kansas City where the municipal hospital is, now opening its 7 doors to pay patients. 8 MR. PETERS: There has been talk about it, but the 9 Council has resisted it pretty much officially, and there has 10 been very little talk about it in recent years. 11 DR. ROREM: In New York States, as I understand it, 12 upstate, a number of these so-called county hospitals are 13 open to the general public. FR 14 MR. PETERS: Herkimer. 15 DR. ROREM: Are any of those in the lower tier like 16 that? 17 MRS. COLEMAN: There is one in Westchester that will 18 take special types of patients. 19 MR. PETERS: Alcoholic, mental disease. 20 MRS. COLEMAN: It was used when we had polio. 21 DR. ROREM: Nothing like the one in Utica, for example. 22 DR. HALDEW: Joe, I wonder if we could go on and 23 get some of the various methods that are being used to try and 24 implement because, as I understand it, there are a number of 2,5 forces, not all within the Council, but within cooperating ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W. WASHINGTON, 0, C. 92 I groups such as Ray Trussells authority in relation to licensure 2 of proprietary hospitals that are having an impact on it -- 3 the use of the 5 per cent funds in the Blue Cross and other 4 things that amount to trying to implement,good planning that 5 are bringing forces to bear from a variety of directions.. 6 MR. PETERS: The Hospital Council has traditional t 7 authority in terms of there were three ways in which we could- 8 influence hospit-a'l planning. 9 And first of all, that was moral suasion. The other 10 was through financial controls) contributions and so forth. 11 And a third was legal sanctions and government authority. 12 We have used all three, but have relied primarily on the first 13 moral suasion. FR 14 So far as government is concerned, it is a very com- 15 plicated pattern in New York City area On gove nt controls 30 16 and there isIa document available which summarizes all the 17 various ways government gets into the picture. 18 But the one way which I think you would be interested 19 is most, in New York City, the Commissioner of Hospitals, 20 Ray Trussel in this instance, licenses proprietary institutions 21 at his 'discretion. And he has interpreted this to mean he 22 can withhold a license to a proprietary hospital and discourage 23 their expansion or even discourage their opening in the first 24 place. And he has relied On Council to assist him in giving 25 advice under which hospitals should be approved and should not ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE. NW W NG@@N , 0, C 93 1 be approved so far as opening, so far as new construction or 2 expansion is concerned. 3 And we have in the pastyear in particular -- two 4 years, actually -- been advising him on a number of proprietary 5 hospitals. All we do is advise him. He has not been able -to 6 make all of these stick. He has had to give in. 7 DR. KLICKA: Why? How does he give in? Is he sued- 8 or how does he give in? 9 MR. PETERS: He hasn't been sued, but apparently io all kinds of pressures have been placed upon him. 11 MR. BUGBEE: He moved in when some of these were 12 already in construction. That was a little hard to stop. .13 MR. PETERS: He came in too late in some instances. FR 14 Others, a little give and take. Some others, he let add a 15 small number of beds. 16 Here is the problem they face. We talk about 17 efficiency of operations. Some of them were small and wanted 18 to become a little bigger, wanted to add 50 beds,, and also 19 wanted to add ancillary services. But to add the ancillary 20 services, economically, they couldn't do it unless they had 21 the beds. So he would have to give in and say, "O.K., 20 beds, 22 but make sure you build up your X-ray department and modernize 23 your obstetrical department or modernize your operating room 24 suite," or such things as that. 25 He realizes in some instances asking the man merely ACE-FEDERAL REPORTERS, INC. 2 6 1 CONSTITUTI0N AVE . N.W. VVA9H!NC,"ON C, C 94 1 to do one without doing the other was economically impossible 2 for them. So he had to face the problem if you want a second- 3 rate hospital w@Ath inferior ancillary services that continue 4 to exist, or do you want to upgrade them a little bit, let 5 them expand their ancillary service, but also expand their 6 beds to some limited extent. And he gave in there to some 7 extent. 8 But, di-! the other hand, I think we have done a great 9 deal to discourage. I think the day of explosive expansion 10 of proprietary hospitals is past so far as New York City is 11 concerned so long as you have a Commissioner of Hospitals who 12 is willing to put his neck out. If and when you get a Commis- 13 sioner of Hospitals who is not willing to take drastic action, FR 14 no one can tell. But I think the day is -- but you have another 15 control,, you have Blue Cross. 16 DR. KLICKA: He has just made one of the most important 17 statements that have been made today, though, and I would like 18 to emphasize this. He talked about courage. And believe me, 19 don't ever discount this in this field. 20 Go ahead. 21 MR. PETERS: Courage? 22 DR. KLICKA: That's right. 23 MR. PETERS: I think Ray Trussel is an outstanding 24 example of courageous action. 25 DR. KLICKA: That's right. That's why I wanted to ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AvE. N.W. 95 1 give it emphasis. 2 DR. HALDEMAN: What other methods are being used in 3 the area? 4 MR. PETERS: Then, of course, these are legal. 5 Theoretically, on the books, according to the administrative 6 procedures of the Department of Social Welfare, the Department 7 of Social Welfare -- this is administrative now, on its 8 administrative cZde -- in considering an'application for the 9 granting of a charter to a new hospital should take into lo consideration need, the need for the hospital. This is not in 11 the law; it is in their working arrangements. And in the past 12 two years, the Department of Social Welfare has come to us and 13 asked us our opinion. FR 14 But I might also add that they have disregarded our 15 opinion after we gave it to them. 16 MR. BUGBEE: Licensure is a jungle. It is between 17 the municipal, delegated to the Commissioners of Rospitals, or 18 the State. You would have to read the book because for 19 proprietary and voluntary in the five boroughs and out, the 20 rules are all different, aren't they? 21 MR. PETERS: It is a very complicated structure. 22 But suffice it to say that the Department of Social Welfare 23 has within its rights the ability to withhold a charter to an 24 institution that is not needed, a voluntary institution which 25 is not needed. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W. WAS@OIIGTON. 0. C,I 96 1 DR. ROREM: I might say in Pennsylvania the law now 2 States that a voluntary hospital has to have a certificate 3 of need and a proprietary does not. 4 MR. PETERS: Proprietary in New York does not either 5 except in New York State, the Department of Social Welfare can 6 withhold the charter to a new voluntary membership corporation 7 which wants to start a hospital. 8 They have not for some reascnor another in our 9I region. We have on three or four occasions in the past two 10 years told them this hospital is not needed, and they have 11 'chosen to go ahead anyway and give the charter out. So that 12 means we do have some legal control, but the Department of 13 i Social Welfare for some reason or another does not choose to I FR 14 follow it. 15 MR. BUGBEE: You have some other idiosyncrasies. 16 The Department of Social Welfare is a board, nonpolitical and 17 nonapproachable through administrative controls or anything else. 18 So they have done pretty much as they want. 19 MR. PETERS: As far as the proprietary hospitals are 20 concerned and municipal hospitals, we have the Commissioner 21 of Trusts of Municipal Hospitals, Department of Hospitals. 22 Take the municipal-hospitals. We have worked with all 23 the commissioners over the past years very closely, and they 24 have come to us asking our advice about the building of 25 municipal hospitals. We have a lot of municipal hospitals that ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N \jV, C@ C 97 i are in inadequate facilities, and there has been some discussion 2 whether they should be closed or replaced. We rendered our Own 3 opinion on a number of these. 4 Dr. Trussel has agreed completely with us that we 5 were right, but here again, we got into the whole area of politi- 6 cal forces and both Dr. Trussel and we have been defeated. 7 I think that Fordham Hospital, which was a hospital 8 we said should be closed, Trussel said it should be closed, al3 9 the knowledgeable people said it should be closed, but local 10 political pressures have kept it open. 11 I think of Gouverneur Hospital which we said many 12 years ago should be closed, Trussel said should be closed, he 13 closed it. But as of a week ago, we have reversed our decision. FR 14 It is now going to be built. 15 MR. BUGBEE: Who has reversed this decision? 16 MR. PETERS: The hospital council because of the fact 17 we were going to make Bellevue Hospital smaller. 18 MRS. COLEMAN: Don't try to understand it. 19 MR. BUGBEE: Ninety million isn't enough for 20 Bellevue Hospital? 21 MR. PETERS: The problem with some of these things 22 here, you mentioned before about location of the hospital -- 23 I think it was Dr.. Rorem mentioned -- this is a problem we 24 faced. 25 The planner can say, "Thirty minutes traveling time,' ACE-FEDERAL REPORTERS, INC. 261 CONST'TUTION AVE., N.W, w@SHING@ON, 0, C. 98 I and Gouverneur-Bellevue is a good example. Gouverneur Hospital 2 was a small hospital which lost accreditation, small municipal 3 hospital, with 200 beds in the tip of lower Manhattan. Within 4 15 or 20 minutes travel time by bus, you came to Bellevue 5 Hospital which is the same type of-hospital except ten times 6 as big, staffed by three great universities -- Cornell, 7 Columbia, and New York University medical schools -- one of 8 the great hospitals of the world that was actually servicing 9 this area anyway in unsuitable facilities, going to be rebuilt. 10 The question was should you rebuild an X-sized Bellevue Hospital or an X-minus 200-bed Bellevue Hospital 11 12 with 200 new beds down in lower Manhattan? We said t'No build the X-sized Bellevue Hospital 13 0 0 FR 14 and forget about the 200-bed satellite down in the southern 15 part of Manhattan which, don't forget, had lost its accreditation, 16 lost its approval, all its residency approvals, a poor institu- 17 tion. But the Mayor had promised in his first campaign they 18 would get a new Gouverneur Hospital. And despite what you 19 say about the Mayor, in this instance, he was tenacious. He 20 kept to his promises. He never gave in. And Trussel advised 21 him to close it, and he closed it, but nobody could make it 22 stick. 23 Here, you have the local community very vocal, 24 demanding something and the planning agency and all the 25 knowledgeable people saying, "No, you don't need this, it is ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT ON AVE N@W C. C I 99 I not for your best interests." How do you reconcile this problem? 2 We are a community agency. We purportedly speak for the 3 community, but are we speaking for the community when the 4 community says they want this and we say no, you don't need it? 5 DR. ROREM: If this had been a voluntary hospital, 6 you could have made it stick. 7 MR. PETERS: How? 8 DR.R They have to get the money from somewhere. 9 MR. BWBEE: They wouldn't have raised it down there 10 either. 11 DR. KLICKA: You didn't change your position? 12 MR. PETERS: We changed it the last meeting because 13 of the rearrangement of cutting down, if they cut down BellevuB. FR 14 DR. RCREM: You saved face by cutting Bellevue back 200 beds? 16 MR. PETERS: Yes. 17 DR. HALDEMAN: Is there affiliation with Bellevue? 18 MR. PETERS: No. they are going to affiliate with 19 Beth-Israel, which is in the area. It is a peculiar thing. 20 We are going to get a Department of Health, Welfare, Hospitals 21 and Mental Hygiene to work together. It is very unique. 22 They are planning on an interdepartmental complex to make certain 23 pioneer efforts in providing care locally. 24 MR. BLUBEE: They are rationalizing the Mayor's 25 commitment. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AVE N.W W41@l,IGI.l O@ C. 100 I DR. HALDA%N: I think their batting average may be 2 pretty good. There are at least two or three municipal units 3 that are being built around and will be operated by a voluntary 4 nonprofit hospital. And it does always seem to me like in the 5 last analysis, you usually have to compromise some things in 6 order to get the major things you want. 7 MR. PETERS: Let me get into the idea of how we 8 work with voluntary hospitals. This is the area where we have 9 done a great deal of our work in the past. And here is where 10 we probably have had the greatest success, partly because, as E 11 said, people ask us to study them. So the mere fact they ask 12 us indicates they may abide by our recommendation. They 13 don't have to ask us under the present circumstances. FR 14 They ask us for our recommendation. We do a study. 15 We come up with an answer. 16 In this instance, I think the greatest tool we have 17 had to use has been Hill-Burton money, being the local agent 18 for Hill-Burton for the State and five boroughs of New York 19 City which has given us a tremendous weapon, actually a weapon 20 far beyond the actual amount of money involved. You are talkiitg 21 on an average of $1.5 million or $2 million a year, most of 22 the grants being made half a-million dollars, $300,000, $200,0()Ov 23 relatively small.grants in terms of the total amount of money 24 which is being expended for capital construction. 25 Here is where we have influenced hospitals a great ACE-FEDERAL REPORTERS, fNC. 261 CONSTITUTION AVE,, N.W. W4@@IIG@@, 0, C, 101 I deal and gotten hospitals to do largely what we would like to 2 see them do. Here we have gotten beyond merely the approval 3 of a grant. We have told them to add outpatient departments, 4 new services. We have attempted in many ways to get them to 5 do substantially more than they intended to do originally,. And 6 I think they have been very successful here. 7 DR. ROREM: I would like to ask a question. You 8 said originally that no approval or disapproval was expressed 9 unless requested by the institution. I-s'that still the case? 10 MR. PETERS: Yes, with the exception now that Dr. 11 Trussel was coming to us asking about specific proprietary 12 hospitals. 13 DR. ROREM: Somebody asks you, though. FR 14 MR. PETERS: And Blue Cross is coming to us, so is somebody is asking us at the present time. 16 DR. ROREM: You don't move in on the basis of sound 17 public policy,you feel you ought to move in on a situation? 18 MR. PETERS: I think in time, it is the intent we ig will move in. 20 DR. ROREM: I have a reason for asking. I am import med., 21 don't wait until they ask you. Tell them first. 22 As the day goes on, I want to hear more about that. 23 MR. PETERS: Actually, if you look at the new structure 24 of the Council, what it stands for, there is no question about 25 it. It was the intent that we move in bef ore we are asked. ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTI(ON AVE . N,W@ W SH,N, 4 "ON@ 0. C 102 I DR. HALDEMAN: Staffwise, you really wouldn't be 2 able to. 3 MR. PETERS: Right now, we have got a small staff. 4 We have got a backlog of requests. We have so much work to do just to keep abreast of all the official requests. We.have 5 6 got half a dozen we are working on right now, and our staff 7 has not grown since the Council has expanded. 8 DR. KLICKA: How many studies have you done of this 9 type in the last three or four years? 10 MR. PETERS: Last three or four years? I guess abou: 11 25 or 30 in the past four years. We do about,,seven a year. 12 DR. ROREM: Special studies, specific institutions. 13 MR. PETERS: And also special studies of specific FR 14 problems or community problems. 15 For example, we are still studying the hospital neecb of a certain area. It is the converse way of going at it 16 because a local group says "Study the area." And we look and 17 18 evaluate the area needs and the hospitals role in meeting 19 these, and we do special problems, particularly voluntary 20 relationship, which is a very complicated one in New York. 21 Several years ago, we studied problems of providing 22 ambulance service to New York City residents. Things like that. 23 We get involved in all types of studies, but as I said, the 24 bulk of them are studying an individual hospital'& program for 25 the future, whether they should affiliate, close, merge, AGE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W. WASeiNCTON, 0, C@I 103 I expand, relocate. 2 We have relocated several hospitals in New York. 3 There are two that were relocated very successfully, both of 4 which have expanded upon relocation -- Misericordia Hospital 5 and Booth Memorial in Queens. Here, we took existing hospitals 6 in Manhattan, which is substantially averbedded, and told them 7 the plants were inadequate, not to build where they were, go 8 somewhere else "ere they are needed more'. We did this on 9 two occasions in recent years so successfully these hospitals lo were expanded, but they were too small when they moved. 11 We have kept one hospital from moving away from a 12 deteriorated neighborhood, and this, I think, has been one of 13 our greatest successes. Here is an area that went bad. Here FR 14 was a hospital that was doing a service. They wanted to go 15 out to the suburbs where the nice people are, and we said,, 16 "No. stay where you are because this is an area of great need, 17 impoverished." 18 DR. ROREM: In Manhattan? 19 MR. PETERS: In Brooklyn. We have areas of Brooklyn 20 that are just as bad as some of the areas of Manhattan. 21 DR. HALDEMAN: You have had several instances where 22 hospitals have consolidated'. haven't you, two or three 23 hospitals together to build a new hospital? 24 MP,. PETERS: We have one recently, Prospect Heights, 25 which was a hospital in Brooklyn, a bad plant, one of the ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N,W. WASHINGTON 0. C, 104 I kind of hospitals that was mentioned give us concern about 2 the quality of care rendered. The hospital was old, almost 3 100 years old. We got them to close and merge with another 4 hospital. The other hospital is still operating as a satellite, 5 but in time they will close the building. The building is no. 6 good. 7 We have done this on other occasions. Ann is working 8 on one right n@which gives every hope of maybe three 9 hospitals merging. 10 MRS. COLEMAN: Three hospitals and an old-age. 11 MR. PETERS: A related facility. 12 We have done this thing that Dr. Rorem mentioned, 13 instead of replacing a municipal hospital on its present site FR 14 which has problems in staffing, problems in getting doctors, 15 good doctors to give sufficient amount of time because they 16 can't bring their patients there anyway, we have got these 17 inferior plants to get these hospitals rebuilt on the 18 grounds of voluntary hospitals or else to get voluntary hospitals 19 to aid these institutions in staffing. And we have been very 20 successful in that. 21 We have one hospital in the Bronx that is going to 22 move with a great voluntary hospital, and we set the pattern. 23 I think this is one of the best contributions we have made so 24 far as relations between the two types of hospitals are concerned 2S in the past years. I think probably Hay Nickelson's greatest ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W. W@SHINGTON. 0 C. 105 1 contribution to the Council was in getting this concept acrossl. 2 It was essentially his concept. 3 DR. HALDEMAN: To get back to implementation., what 4 about the Blue Cross, the 5 per cent fund, the Blue Cross 5 collection? 6 MR. PETERS: We have done nothing on that. 7 DR. ROREM: What is that? 8 MR. PttERS: In the recent Blue Cross formula, the 9 hospitals can put away 5 per cent, but this cannot be expended 10 without approval. It can only be expended for rep lacement or 11 expansion. It cannot be used.to underwrite deficits. And 12 this is, as you can well imagine in a city which has so much 13 money expended for medical care as New York City or the 17 FR 14 counties of the New York area which Blue Cross is responsible 15 for., a tremendous amount of money. It has been going on now 16 for about two years accumulating. And within a few years, you 17 are going to be talking about millions and millions of dollars 18 DR. ROREM: Is this 5 per cent paid over to the 19 hospital or given -- 20 MR. PETERS: Given to the hospital, but they have 21 to set it aside. They have to fund it or they may. 22 MR. PETERS: They-have to. 23 DR. HALDEMAN: And isn't it also true the purposes 24 for which it can be funded have got to meet approval of Blue 25 Cross? ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTioN AVE N.W W@SH",,ON 0 C. @l 106 I MR. PETERS: Blue Cross. 2 DR. KLICKA: Blue Cross or the Council? Please 3 repeat. Blue Cross., not the Council yet. 4 DR. HALDEMAN: The feeling, as I understand it, is 5 they may ask the Council's advice but I think there is a 6 legal question which Jim might raise later on as to whether 7 they could turn over the responsibility to the Council. I 8 think there is a question whether that would be legal. 9 MR. PETERS: One of the problems they face is the 10 fact how much autonomy these other agencies can give up. Blue ii Cross can ask our opinion. 12 DR. ROREM: Is this actually a 5 per cent plus over 13 and above depreciation allowance? .r@ R 14 MR. PETERS:' No, this is the equivalent. 15 DR. HALDEMAN: Jim, would you want to touch on this? 16 MR. ENSIGN: I want to say Doug Colemants concern has 17 been all along with some parallel action on the Blue Cross 18 Board, advice given it by the planning agency. And the opinion ig that has been given them by the legal counsel is if they merely 20 accept as their ruling the opinion of the planning agencies,, 21 they might be in trouble with restraint of trade or collusion. 22 And so, therefore, I guess the approach is they ask the advice 23 and then act upon that advice. 24 MR. PETERS: Trussel faces the same problem as 25 Commissioner of Hospitals, precisely the same problem. ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AvE., N.W. W,4sm@,cr,N. D. C. 107 1 MR. BUGBEE: And the welfare,too. 2 MR. PETERS: Welfare does, too. 3 MR. ENSIGN: And I think in Michigan, Jack can probably 4 comment on this, Blue Cross gets advice from the Detroit area 5 Hospital Council or Hill-Burton authority, other State areas.' 6 and acts accordingly and may use other evidence that they 7 gather themselves to reach the decision they finally reach. 8 But usually, it is in line with recommendations of the planning 9 unit. 10 DR. HALDEMAN: Are those pretty well all the imple- 11 menting devices that there are available to the Council or in 12 New York? 13 MR. PETERS: Of course, there is also the fact that FR 14 groups like United Hospital Fund and so forth can use certain is sanctions - depending, to implement our recommendations, but 16 United Hospital Fund at the present time doesn't get involved 17 in construction, merely giving contributions for free care. 18 But if United Hospital Fund gets involved in a 19 capital fund drive, which they have been seriously considering 20 for years and which officially they are going to probably get 21 involved in next year, it is their intent that in distributing 22 the monies raised, they will turn to the Council again as Doug Coleman tur ned to us for advice. 23 24 Whether they will take our recommendations 100 per 25 cent is the same problem that was ra ised before, but they will ACE-FEDERAL REPORTERS, INC. 261 CONSTI TUTION AvE., N,W. WAStliNGTO'4. 0. C. 108 1 turn to us because we have the mechanism to determine need, 2 and they haven't got it. They have got the money. They have 3 got to give it uut according to some rational basis. 4 They will turn to us, seeing they will support us 5 anyway to the tune of $80,000 a year, turn to us for advice 6 on how to distribute this money. They are talking about 7 tremendous sums of money. 8 DR. R@: I would like to ask just so I get it 9 straight, I have suggested from time to time on my own as I am 10 concerned with a broad problem that Blue Cross depreciation 11 allowances might very well be made in a central fund to be 12 used for general hospital construction as an institution need 13 may appear instead of paid out to the individual hospital. FR 14 Has that been picked up and laid down or not picked up? 15 MR. ENSIGN: There has been a lot of discussion on ii:. MR. PETERS: I can say you wouldn't be elected man of the year by the voluntary hospital boards. 17 18 MR. ENSIGN: We discussed this and did some legal 19 research on the question, and it was found you run into some 20 problems like with withholding money ostensibly which belonged 21 to and was the right of the hospital to receive as a proper reimbursement, diverting it into a central pool. 22 23 I don't know that it has ever been tested. I don't think it has. It is something peo le talk about, but they are 24 p 25 all af raid of . ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE.. N,W, cl. C. I 109 1 DR. ROREM: There are things, too, whether or not a 2 big responsible agency like that does not have an obligation 3 to see that the total properties are kept in balance rather 4 than the individuals. 5. DR. HALDEMAN: How about priority and principles? 6 What have you other than these basic principles. 7 MR. PETERS: We haven't enunciated anything in writing, 8 but we operate pretty much with priorities. and the Board 9 operates. 10 Obviously, we are always interested, for example, 11 in replacing unsafe facilities. This is one of the priorities 12 which has been given. We have always given a great deal of 13 emphasis to this both in administration of our Hill-Burton FR 14 program,locally and in our studies. We have always given a 15 great deal of stress to hospitals which exercise a great 16 influence on the region. 17 For example, the great university teaching institutions. 18 We try to strengthen them as much as possible because when you 19 build up a Columbia-Presbyterian or New York-Cornell Medical 20 Center, you are not talking about a hospital now which is 21 servicing a local community. You are talking about a hospital 22 which services the entire region, both in terms of patient 23 care insofar as many of the very difficult cases are sent there. 24 It is leadership in terms,of medical education and research. 25 And these institutions, there is no question you get a great ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE., N,W, W45HINGTON, D. C. 110 I deal of support from the Council. 2 In other words, what we are trying to do if we could 3 do it, we would like to build up the strong and starve out 4 the weak because it is awfully difficult, we find in the past, 5 to try to build up the weak, particularly if they are occupying 6 some poor plants. 7 MR. COUSIN: Mr. Chairman, I would like to ask a 8 question. We, I-think, tend to have a little bit of that 9 philosophy except that you can then be accused, you know, of 10 backscratching, and we are occasionally. 11 What do you do when you have a suburb where they 12 have all the dough in the world and they have an awful lot of 13 the good medical staff that are in these so-called great FR 14 institutions. And you know darn well that this now hospital 15 is starting out, it may be 200 or 300 beds, but that eventually, 16 in the future, it probably, too, will become a great institutiim. 17 Now, do you encourage it to go up to 4002 500, 6009 18 700? There is need out there. Or when a great institution 19 in downtown New York where there is a surplus of beds wants 20 to go from 1,000 beds to 1,300, you just give them your papal 21 blessing because they are so-called great hospitals? You tell 22 them, O.K., automatically, go an extra 300 beds where actually 23 those 300 beds you could put up a good argument they should be 24 in Bronxville or Queens or some other place? 25 DR. HALDEMAN: In other words, you are entering anotiLer ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AvE N,W. W"@'ll'ON. 0. C, I dimension, the suburban and central city. 2 MR. PETERS: I have been talking primarily in terms 3 of what I know about the most, New York City. Getting into 4 the suburban area, you have an entirely different problem, 5 no question about it. You certainly don't expect them to.come 6 from Poughkeepsie to go to downtown Manhattan togpt their 7 medical care. You have to provide a lot locally and no -it. You are going to have to strengthen the 8 questions about 9 suburban hospitals the best you can. 10 But when you come to the other problem you mentioned,, 11 there are decisions you have to make. 12 MR,., COUSIN: The decision we have in our area , Ford 13 Hospital came to us and wanted to put up 300 or 400 beds. FR 14 We have to admit it is a great hospital, but an the other i5 -hand, it is in an area where we have got I can't remember 16 offhand -- 2,00 or 3,000 surplus beds. 17 MR. PETERS: I would tell them not to do it, then, 18 if you can get away with it. 19 DR. KLICKA: If we can ask Mr. Peters to summarize 20 the points of strength of implementation and the points of 21 frustration, areas that he wished they had greater support thall 22 frustration, see if he can put them into a concrete ball of wa:c 23 for us here. 24 MR. PETERS: I would say one of the things we wish 25 we knew about the most is we could know the plans earlier, ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVr., N W. W49HINGTor,. 0 C 112 1 the plans of all the hospitals, what they intend to do, 2 because I think this is one of the things we are weakest on. 3 We don't find out about things until it is too late to do any- 4 thing about them. And if we could have a mechanism whereby 5 we would be assured that -- I am.not talking about after the 6 plans have been approved by the Board; I am talking about when 7 the first seed comes in somebody's mind we would like to 8 do something that we would know about it and we would be able 9 to give our reaction to it. I said, flour reaction" either 10 our approval, disapproval, caution., or whatever we want toldo. 11 But if we could get a mechanism where we could get that for al. 12 the hospitals, I think we would be a great step forward. 13 It wouldn't solve all our problems by any means, but it would FR 14 certainly be a great deal better than what we are doing now 15 because now we find it is half done sometimes. 16 MR. SIBLEY: You must have that for a very high per- 17 centage of your hospitals already, don't you? 18 MR. PETERS: Yes, but we don't have all of them. 19 MR. SIBIEY: What you mean is you don't have every 20 one. You have'a lot. You sounded as if you didn't know. 21 MR. PETERS: We don't have them for all of them. 22 MR. SIBLEY: You have got to find ways of cultivating 23 the hospitals that so far haven't cooperated. 24 MR. PETERS: I am talking about at the present time 25 we get a great deal of it through our inventory. Once a year ACE-FEDERAL REPORTERS, INC. '61 CONSTITUTION AVE., N.W W@,,/ ... ON, 0. C. 113 I we take an inventory of all hospitals, and we ask them) 'What 2 are you planning to do?" A great deal of the information we 3 get has already been approved by their Board. They have 4 hired an architect or they have got a consultant working. s We would like to get down even before that. 6 MR. SIBLEY: I agree, but once a hospital sets up 7 a master plan for itself, you are pretty much aware of what 8 direction it is ioing. 9 MR. PETERS: Yes, but it maybe would not be what lo we would like to see them do. 11 MR. SIBLEY: You do on a master plan. 12 MRS. COLEMAN: We don't get that. 13 MR. SIBLEY: I realize this is one of the techniques FR 14 we are talking about, certainly. One Hill-Burton agency I i5 know of will not consider a hospital proposal until they have 16 seen the master plan of that hospital. 17 MR. PETERS: There are darn few hospitals in New i8 York that have master plans in that sense. 19 MR. SIBLEY: This is long-range, 20 MR. PETERS: Very few of them do have. 21 MRS. COLEMAN: When they apply for Hill-Burton, that's 22 narrow. 23 MR. PETERS: It is much more the immediate program. 24 MR. BUGBEE: I think there is one point to be made 25 here, though, about reviewing. And I think Rufus is beginning ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT ON AvE N.W@ WASHINGTON. 0. C- 114 1 to get individual plans. The New York area exaggerates it, 2 but everyone of them, you can't just read a plan and say yes 3 or no and add any depth to it. If you are going to go out 4 and really look into it, you are talking about a lot of staff 5 time as well as a good deal of wisdom. 6 So if they all came at you I don't know what you 7 would do because you can't hardly cope with those that do 8 come to you as a staffing job. 9 MR. PFTERS: Certainly, if they gave me all the 10 plans tomorrow, we would probably put them all in the file case 11 because we don't have the staff to analyze through and pick up 12 as we need it. But as we grow and develop, I would hope we 13 could get this type, being advised as early as possible as to FR 14 the planning of each individual hospital. 15 DR. ROREM: I would like to make one observation 16 there. I wouldn't think you would have-to be completely 17 frustrated if you got a flock of plans. Just an arithemtic- 18 alignment of what they added up to would probably show you it 19 was impossible and just to let the other hospitals know that 20 the one up the street is planning the same thing you are has a tremendous chilling effect. 21 22 The very first thing we did when we got in Pittsburgl,, 23 we did this. We asked for the plans'. It added up to a tremendous 24 amount of money, in this case, a small area, $90 million and 25 2,000 additional beds. We just added them up. We didn't AGE-FEDERAL REPORTERS, INC. 6 t CONSTITUTION AVE . N.W. 0. C. 115 I evaluate them at all. And we reported them to the group, 2 this advisory committee as a whole. 3 You would have thought, goody, goody, think of all 4 that money. They said, "My god, we will all go broke together." 5 That was the reaction. 6 MR. BUGBEE: It sounds like to you are answering- 7 "I am not right in this." You may be able to make such an 8 answer, but when-you come to work with them as alternatives., 9 then you are just not talking about an office procedure by a 10 long shot. 11 MR. COUSIN: Another problem you get into, because 12 we did this very samd thing. We did just add them all up, 13 and we came out with a $125 million. What did this do? This FR 14 had a chilling effect on the voluntary, the truly voluntary 15 system, particularly the corporate givers. But it had a blow- 16 torch effect on the hospitals that didn't intend to ever hit 17 the corporate givers anyhow. 18 We didn't do this, but what happened was that the 19 better hospitals had to suffer about a six-year moratorium 20 before they could get any money while the Hospital Council 21 studied the situation. But approximately an equal amount of 22 unsatisfactory beds of a quasi-proprietary nature were built. 23 MR. BUGBEE: What conclusion do you draw from that 24 Jack? What do you mean? Ycuwould be opposed to announcing 25 the $125 million until you had your study or ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT ON AVE , N.W. IC WA$MFNGTON@ 0. C.I 116 1 MR. COUSIN: No. I think we finally resolved the 2 situation, but it was after the horse was stolen. And that is 3 we got the Blue Cross eventually put through its standards 4 that they wouldn't take anybody on as a participating hospital 5 until they had been approved. So now, if we were to announce 6 $125 million worth of construction, any of these guys who do t 7 not intend to hit the community for philanthropic funds or evell 8 hit Hill-Burton,-- they would still be faced with the fact that 9 if they built their hospital, they would eventually have to 10 go to Blue Cross for participation and Blue Cross would turn 11 to us, and we T,,ould say we never heard of this hospital. 12 DR. HAI.DEMAN: What type of hospital'7 13 DR. KLICKA: I would answer that more specifically FR 14 because we have the data, and we wouldn't publish it for this 15 reason. The very worst thing that we have in Chicago is the 16 State survey and planning as an example of this because we 17 think it exaggerates the need for beds in our whole metropolitan 18 area. And the people who shouldn't be building beds are 19 continually pointing to this State survey and plan as their 20 justification for doing it. 21 MR. PETERS: I can tell the New,York City experience 22 with the same thing. They had a meeting just the other day on 23 this very subject. 24 MRS. COLEMAN: The problem is we have a high figure 25 on bed requirement on the State plan, and we know it is high. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W, WA@Hlkr.TnN D CI 117 I I am quite sure that if our beds were properly distributed) 2 we could lower the bed requirement figure by as much as perhap3 3 4,000 beds. But the point is we do not operate under these 4 circumstances. 5 We have too many maternity beds. We have too many 6 specialized beds in specialized hospitals. We have too many 7 beds in small hospitals. And under these circumstances, we 8 do need approximately what is called for in the State plan. 9 Doug Coleman raised the point that the people are 10 quoting this figure to him, this bed requirement figure. So 11 we sort of compromised on disclaiming the figure by a footnote. 12 Actually, it shouldn't be used as a planning figure. It is 13 what we need now. FR 14 MR. BUGBEE: Are these Hill-Burton figures, the beds 15 per thousand ratio without adjustment for use, or what are the]r? 16 DR. HALDEMAN: No, even with adjustment -- 17 MR. BUGBEE: Still high. 18 DR. HALDEMAN: -- they are still high. 19 I don't think the purpose of this meeting is to go 20 into Hill-Burton planning, but we are working very hard, as YOIL 21 know, George, revising our procedures and policies. We want 22 to get away completely from ratios. We want bed need determined 23 on the basii of projected population, taking into consideration 24 utilization by major service. 25 The main problem is the small one, even in New York ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE. N. W. W @ @ H I N (-, TN D C 118 1 city, lack of manpower. The tendency an the part of Hill- 2 Burton agencies is to go in and study areas that they know 3 they are going to have to project in the next two or three 4 years, and they are kind of treading water with this thing. 5 As a result, here in Washington, D. C., for example, 6 Hill-Burton plans for Maryland and Virginia greatly overstate t 7 the need in the suburban areas which are growing rapidly 8 and can take additional beds. But at the same time, you can 9 go to the plan, and it is very unrealistic planning. 10 Getting this thing over onto a more realistic basis 11 is a more complicated thing than we had originally anticipated 12 We have had a committee meeting almost monthly now for about 13 a year and a half particularly considering such things as, FR 14 first, what is the definition of a bed capacity because Hill- 15 Burton agencies have agreed to develop a uniform bed capacity 16 so one State's plan can be realistic in terms of another State s 17 plan. 18 For instance, if you just change a minor definition is on State plan, you may overnight change the bed need factor by 20 several thousand beds. 21 Secondly, the definition of suitable or unsuitable 22 has varied all 4mrer the place. California until this year 23 hasn't admitted there is an unsuitable bed in the State from 24 the standpoint of fire safety. If they license it, it is suitable. 25 Whereas in New England, about 20 per cent of the beds in the ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W. WASICINGTON 0. C. 119 I State agencies are declared unsuitable. And this is an 2 extremely complicated subject which we are moving on as 3 rapidly as we can,, but which with the present state Hill-Burtoa 4 agencies staffs is going to take time to develop in each 5 community because there is no substitute for detailed study 6 of the individual community. 7 Now, our hope is that the areawide planning agencies. 8 are springing up-all over the country literally. Today, we 9 invited purposely representatives from areawide planning 10 agencies that have been in existence and had some experience 11 but we have got, as you know, a large number of agencies that 12 are coming into being. 13 DR. R@: bid you count the list that Hi sent us$ FR 14 21 full-time and 19 part-time? 15 DR- HALDEMAN: What will happen five or ten years 16 from now, I think will be much different, and I think in most 17 instances, the State Hill-Burton agency will utilize the plans 18 as developed within a State. 19 I think the State agency is faced with developing 20 areawide planning agencies that will approach a problem somewhtt 21 consistently. 22 You take Ohio, Columbus, Cleveland, Akron, Cincinnati,, 23 all use different definitions of what is beds or different 24 principles in evaluating projects, not that every community ha, 25 to do the same. ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE:., N,W, C 12 I And I think what has been said today illustrates 2 the fact your approach in areawide planning has got to be 3 different according to the characteristics of your community. 4 But there are certain overall principles, at least. These 5 certainly are going to be tremendous when they start handing 6 out the money for a modernization program because Cincinnati 7 might get twice as much per capita merely on the basis of your. 8 criteria for evaluating obsolescence being different in one 9 community than in another. But this is a hard pull. 10 Now, we have not given any demonstration grants in 11 areawide planning where there hasn't been a cooperative 12 arrangement worked out between the State Hill-Burton agency 13 and the local areawide planning group. I don't think they can FR 14 completely give up their responsibility, the State can't, but 15 1 think in almost all instances, they will take the recommenda- 16 tion of the local areawide planning agencies. 17 MR. DRENNAN: This past year, we worked very closely 18 with the boys in that. The weekly utilization, we turned up 19 occupancy rates and utilization they used in formulating the 20 areawide State planning as far as our particular area was 21 concerned. 22 MR. BLCBEE: Did it change the bed requirement? 23 MR. DRENNAN: Slightly. It reduced it because we 24 learned alot about occupancy rates of small hospitals and so 25 forth during the Past year. ACE-FEDERAL REPORTERS, INC. 2 61 CONST)ITUTION AVE N.W. WA SHIN GION. 0, C@ 121 I DR. HALDEMAN: I think we have got a lot more to 2 learn about what constitutes bed need. We have had two 3 national conferences on this subject which at least from my 4 point of view -- I don't know how you felt -- it showed up 5 the problem areas more than any solution because I can't 6 for the life of me understand why Indiana should only have 7 2.7 beds per thousand and Missouri have 4.5 beds per thousand.- 8 There is the same disparity between Idaho and Montana, for 9 instance. And it isn't all in connection with the way they deter- 10 mine what is a hospital bed. 11 There are some factors we simply don't know about. 12 That's why I feel so strongly that bed need should be determined 13 based on a local study, using utilization, but using judgment FR 14 factors that can't be derived from figures. 15 Because if you get a new highway going out in an iB area, it is going to have an impact , or, you know,, a big 17 industry is coming in. Those things aren't derived from 18 statistics. 19 In the last analysis, bed need, I think, in the 20 light of our present knowledge has to be the analysis of 21 available data plus pooled professional judgment. 22 I think perhaps we should break for lunch. Let's 23 try to be back at quarter of two. 24 (Whereupon, at 12:40 o'clock p.m., the meeting 25 'recessed, to reconvene at 1:45 p.m. the same &y.) AGE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE . N.W@ WASHINGTON, 0. CI 122 SHORT 1 AFTERNOON SESSION AEW July 8 2 1:45 p.m. fls Ace 3 DR. HALDEMAN: The meeting will convene again. 4 Are there any further questions any of you want to 5 ask Joe Peters about the New York program? 6 Anything further, Joe, that you or Ann would like to 7 add? 8 If ino@Z I think we ought to go.on to Sue Jenkins and 9 see still another distinct variety of planning activity. 10 MISS JENKINS: I will try to make this brief because 11 we are dealing with a much smaller area and problems that look 12 big to us, but I can see them shrinking in size. This is a 13 consoling thought. 14 I will briefly describe the characteristics of the SR 15 area, the hospital and nursing home situation of the planning 16 agency, the methods of implementation, and share with you some 17 of my apprehensions about some of the points of establishing 18 priorities and in the possible light of coming Federal funds 19 for modernization I should like to share them with you, too, 20 if I may. 21 Our area is one of 1,200,000 people involving five 22 counties in two states; three counties in Missouri, two coun- 23 ties in Kansas. In that area there are twenty-two hospitals 24 if we include our Veterans Administration Hospital and our 25 United States Air Force Base Hospital which are not involved ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE . N.W. W."",-,. D. --.f 123 2 1 in planning except the USAF hospital was and wanted to add 2 twenty OB beds and we stymied it through contacts of the 3 Bureau of the Budget in Washington, they did not think they 4 had the OB beds. 5 These twenty hospitals range in size from the smallei5t 6 of forty-five beds to the largest of 500 beds. There is one 7 medical school hospital there at the present time, the Univer- 8 sity of Kansas, which draws its patient load from all over tho 9 State of Kansas as well as the metropolitan area and Missouri. 10 A new and illuminating factor which Dr. Haldeman is 11 very familiar with and has served as consultant to is our 12 municipal hospital system which has gone under a private volun- 13 tary board operated under contractural relationship with the SR 14 city which now is affiliated with the University of Missouri 15 School of Medicine presently located in Columbia but extending 16 post graduate work and looking ultimately, Jack, in the last 17 few weeks even towards the faster coordination of a medical 18 school in Kansas City. 19 We have no proprietary hospitals with the exception 20 of one little twenty bed osteopathic proprietary hospital. We 21 have succeeded in killing three proprietary projects. We do 22 not anticipate that we will always have such a good batting 23 average. 24 DR. HALDEMAN: How did you kill them? 25 MISS JENKINS: Two of them through the planning ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N.W. 124 3 1 agency. one of them in the suburban areas simply by communica 2 tions with and about a twenty-page report to a couple of the 3 medical leaders simply scared the parts off of them about the 4 possibility of their ever being able to operate at a financial 5 level that would permit it to pay itself out. The other two 6 through simply conferences with the planning group which we 7 were able to persuade them Dot to go aheadtwith it. We do hav( 8 the two Federal hospitals, the USAF Base and of course the 9 Veterans Administration hospital. 10 This five county area contains the four city and all 11 suburban areas. The suburbs do not yet go beyond the periphery 12 of the five counties. We do have a very close relationship 13 with the two state Hill-Burton agencies an excellent one with SR 14 Kansas, not too good with Missouri, but at least a working 15 relationship. We have been dealing very heavily in the past 16. six months in the nursing home picture where we are ceding, as 17 most urban areas are, a tremendous surge of the building of 18 the proprietary nursing home, many of them with-FHA secured 19 loans or reaching through the Small Business Administration, 20 some with private financing. 21 The planning agency itself was established by the 22 hospital organization. 23 DR. KLICKA: You do not get into the control of that 24 at all? 25 MISS "NKINS: The what? ACE-FEDERAL REPORTERS, INC, 2 61 CONSTITUTION AVE,, N,W, 0. C. 125 4 1 DR. KLICKA: The nursing home field. 2 MISS JENKINS: Yes, indeed. We are working almost 3 exclusively. 4 ER,.. KLICKA: You have approved them? 5 MISS JENKINS: In Kansas we have a relationship with 6 the State of Kansas that they will not approve any--nursing homE 7 project in the two county urban area on the, Kansas side that 8 does Dot have our approval first. 9 DR. HALDEMAN: What is that? 10 MISS JENKINS: They try to make it for licensing. If 11 private finance comes in and wants to build in that area, they 12 check first with the Kansas State Board of Health, their 13 Facilities Division, for what they will require for life 14 insurance and so on. They are referred to us before the R 15 Kansas agency will even talk with them practically. Whether 16 we could stop them has not come to a test yet of those that 17 are totally privately financed so we have not had any built 18 yet. 19 For FHA they have to have our approval on the 20 Missouri side. We could not get the state to say they would 21 not issue a certificate of need unless a need could be demon- 22 strated. They blanket issue a certificate of need in Missou3t. 23 Simply, if their quota says there is a need, they issue it. 24 We got around this by establishing really a very fine working 25 relationship with the FHA people who have decided that they ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTION AVE., N.W. WASHINer@@. D. C. I; I 126 5 I will not talk with them until they have come and talked with 2 us and had a report on it. 3 MR. BUGBF.E: Have you said no to anybody? 4 MISS JENKINS: Yes, to I expect a half dozen. 5 MR. BUGBEE: Not on need but on sponsorship? 6 MISS JF.NKINS: Actually we are right up at what we', 7 may consider the top area of need insomuch'as the market demanol 8 indicates this because most of these big promoters are coming 9 in with a high priced home up in the four, five, six hundred 10 dollars a month bracket. We have a report we will be sending 11 to you hopefully within the next week to ten days of a researci 12 study in which we cooperated with community studies on the 13 market demand for nursing homes which gives a pretty fair SR 14 picture of the existing licensed homes, all of those that are 15 projected and those that are in the process of construction 16 and those that are in the dreaming s-tage and have just barely 17 contacted us about them. 18 We have gone into, 1 think, a pretty fair analysis 19 of demographic data, income brackets, those on old age assis- 20 tance, what the Blue Cross plan does, what the insurance pro- 21 grams do and so on. We have been dealing then with a planninE 22 agency that is involved in facilities and services in the 23 hospital and nursing home area. We have not gone beyond that, 24 The planning agency itself, the planning committee, 25 the basic committee, is a fifteen man committee which has beei ACE-FEDERAL REPORTERS, INC. 2 6 1 CoN!3TiTUTION AVE.. NW W,@Hl,,r@, 0 c-, 127 6 1 functioning since 1957. It is required that a majority, 2 actually I thiDL- nine of the fifteen, are now totally non- 3 hospital related individuals. We are most inadequately 4 staffed. The staffing is a little different than it looks on 5 paper in that we do have a very able and very highly recognized 6 non-profit research organization in the area of community 7 studies incorporated with whom we collaborate in research and 8 who produce some research for us. We also have a relationshi- p 9 with the Blue Cross plan which provides us mimeograph, address.- 10 ograph, photocopying, handling of all mail and all this type 11 of thing which we do not have to staff for. 12 Blue Cross does all of our IBM work, all of our 13 statistical work. We do have a continuous reporting program SR 14 which is now in its seventh year, and this is all on IBM and 15 is maintained for us by Blue Cross. 16 The planning committee functions in a relationship 17 to the hospital organization in, I think, a very comparable 18 way with Jacques Cousins in Detroit. He has complete economy; 19 it is not controlled by vested interests, it is not a corpor- 20 ate structure, it shares staff and it is inadequately staffed. 21 MR. BUGBER: You are going too fast. I thought there 22 was one structure that did both. 23 MISS JENKINS: Yes. 24 MR. BUGBER: You are doing both? 25 MISS MMKINS: Yes. ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTION AVE . N W 0. C. 128 7 1 MR. 13UGBEE: I see. But in spite of that 50 per cenl 2 of yoLr board is public members rather than hospital members? 3 MISS JENKINS: No, the planning committee must be 4 maintained at over 50 per cent non-hospital related. 5 MR. BUGBEE: I see. 6 MISS JENKINS: The over-all board of directors of th(i 7 hospital organization is a public trustee medical staff and 8 administrative. 9 DR. HALDEMAN: Does your planning committee report 10 directly to the public? 11 MISS JENKINS: Directly to the public, never to the 12 board. It makes no report to the board, it has no strings to 13 the board at all. Its principal relationship to the board is 14 that the board has to see that it is provided with staffing. SR 15 The board appoints the chairman, no others of the planning 16 agency. 17 MR. BUGBER: Who does appoint him? 18 MISS JENKINS: Actually, the nucleous-of the plannin@ 19 committee was first named by the board. Beyond that it is a 20 self-appoii)tive body. 21 MRS. COLEMAN: Responsible to whom? 22 MISS JENKINS: Responsible to itself.and the commup- 23 ity I should say. It is no different than if it were separately 24 incorporated actually in this respect. Represented on it are 25 trustees and physicians but it is dominated by your industrial ACE-FEDERAL REPORTERS, INC. 261 CONST'TUTION AvF N.W, W.@"I.roN. 0. C. it 129 8- 1 and your civic representatives. 2 It was possible to get at least all of the major 3 hospitals to develop their long range planning committees. 4 The first couple of years actually the function.. of this 5 planning committee was conferences, not only one but several, 6 with each individual hospital regarding the development of the 7 planning committee in an effort to determine to the extent the 8 planning group could the desires and aspirations of this par- 9 ticular hospital; the direction it hoped to go, the type of lo service in which it was interested, whether it was in expansion 11 of its teaching programs, development of research and the 12 chronic long term care or what it might be. 13 We have certain peculiar problems, the osteopathic 14 thing is one of them. Jack, I did not realize you have this ,R 15 to the extent you apparently have. We have in Kansas City one 16 of the osteopathic colleges, of which I believe there are stilL 17 five in the country, are there not? 18 DR. HALDEMAN: Michigan is trying to establish 19 another one. 20 MISS JENKINS: Are they really? 21 MR. COUSINS: Yes. 22 MISS JENKINS: Where? 23 MR. COUSINS: In Michigan. 24 MISS JENKINS: Goodness. 25 DR. HALDEMAN: Of course it is quote possible that i]3 Kansas City that this osteopathy school will become the ACE-FEDERAL REPORTERS, INC, 261 CONSTITUTION AVE. N.W 0. C. 130 9 1 medical school at the Kansas City Medical Center. 2 MR. BUGBEE: Kansas City? 3 DR. HALDEMAN: Yes. There is talk of it. 4 MISS JENKINS: We have encouraged it. We have had 5 the municipal system actually have four hospitals, now have 6 three. They did have General No. 1 for white and General No. 7 2 for Negro. It has been integrated for se'veral years Dow. 8 MR. BUGBEE: Which state is that? 9 MISS JENKINS: Missouri. 10 Actually, we have in the area four major municipali- 11 ties. There are some eighty lesser.incorporated municipalities 12 that make up the urban comples in this area. 13 MR. BUGBER: Does Kansas City, Kansas, have a muiii.; 14 cipal? SR MISS JENKINS: No, Kansas City, Kansas, has a long 16 and conditional relationship between the hospitals and the care 17 of the patients, also the University of Kansas City. The 18 [Jiiiversity of Kansas-has done a great deal of this work for the 19 Kansas side. The Missouri side has had the General Hospital 20 which is now the General Hospital Medical Center. 21 The osteopathic situation is one of the problems of 22 .31anniiig. We have fewer than one one bed fe;r osteopath and fivi) 23 Eor the MDts. There is Do crossover at the present time except 24 )ut in the region. Not within the planning area but within the 25 .region we have some of the small county hospitals with both the ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE@ N.W. WASHIP.IION, D@ C. 131 10 1 MD and osteopathic on the staff. 2 As Dr. Haldeman mentioned there has been some talk, 3 and we have been doing some talking, about the KaDsas City 4 College of Osteopathy and Surgery forming a Duclear of a Dew 5 medical school. Whether this can come to fruition, Jack, 6 within the time necessary is the factor there. There does Dot 7 appear to be the major resistance of the organized medical 8 profession against it that there was, say, even five years ago- 9 Another problem relates to three very small Negro 10 hospitals in an area that has made very forward steps toward 11 integration within the past teii years. Each of these Negro 12 hospitals wants the community to build a new hospital, each 13 three times the size that it presently has, when they are 14 runining two of the smallest ones, only about 40 per cent SR 15 occupancy at the present time. 16 This is a difficult one to deal with, Dot in size 17 but in all of the sociological aspects of the thing. We are 18 hopeful, Jack, that we can help resolve the Negro thing througIL 19 the General Hospitals taking pay patients. Many of the Negro 20 lgroup that are in the largest of the small Negro hospitals, 21 100 bed, are very marginal cases, This hospital is operating 22 at four dollars per day below its cost structure and its charges 23 at the present time without any means of supporting it finan- 24 cially except the Catholic Diocese. We are hopeful that the 25 small segment of the Negroes who do not have a place to ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AvE. N.W. W."",-" D. C. 132 I practice may be accepted by the General and thereby manage to 2 close. 3 Somebody here commented how difficult it is to close 4 a hospital that has ever had existence. If anybody knows any 5 easy way to go about taking out an entity that is in miserable 6 financial condition, that is carrying a far below optimum 7 patient load and all and still take them out of existence, I 8 don't know. 9 Of this group of hospitals there were only two 10 specialty bnspitals, one a children's hospital and the other 11 a 75 bed psychiatric hospital. The childrents hospital situa- 12 tion has been reasonably resolved again through the really ver:r 13 good work of the planning agency in that it will affiliated 14 with the General as a part of this Missouri University,complex SR now. 16 DR. HALDEMAN: Not only affiliate, they are going to 17 replace the two hospitals with a single physical structure. 18 MISS JF.NKINS-. What are you referring to as the two 19 hospitals? 20 DR. HALDEMAN: The children's hospital and -- 21 MISS JF.NKINS: You mean Mercy? 22 DR. HALDEMAN: Yes. 23 MISS JENKINS: That will provide the facility. It 24 will Saintai@ separate operation, however. 25 DR. HALDEMAN: But there will not be a duplication ACE-FEDERAL REPORTERS, INC. 2 6 1 CONSTIITUIION AVE,. N@W W-SHiN.10N. 0. C. 133 12 1 of kitchen or X-ray laboratory or whatnot. At least, that is 2 the hope. I thought that was nailed down. 3 MISS JENKINS: I thought it was nailed down, too, 4 but it is not nailed down at all. They are even saying they 5 are going to build their own labs, X-ray, kitchen and every- 6 thing else. 7 DR. HALDEMAN: It is very interesting experience 8 where we talk for a day and a half, a half dozen foreigners 9 sitting down with the planning group and the board trustees of 10 these two hospitals, and at the end of it I thought they had 11 agreed to build only one new structure and maintain the iden- 12 tity of Children's Hospital. 13 MISS JENKINS: But to share, not to put in laundry, SR 14 not to put in power plant. They are still abiding by these 15 two. They are not abiding by the fact they are not going to 16 have their own X-ray and their own laboratory and their own 17 kitchen and all that, except a factor coming to light within 18 the past two to three weeks may reinstate your hopeful prog- 19 DosticatioDs on this. 20 This hospital first was talking about 200 beds and 21 the planning committee kept pushing them back and pushing them 22 bac4: on it. They decided to build 115 beds. They have 103 23 beds at the present time and the General Hospital and Medical 24 Center has 40. They agreed upon 115 finally. It was not easy 25 to get it to that but they come out that this 115 bed hospital ACE-FEDERAL REPORTERS, INC, 2 6 1 CONSTITUT'ON AVE., N.W. WA SH it4GTON, 01 C. 134 13 1 was going to cost $5 million. They started on a fund drive 2 for three and a quarter million dollars saying that the balance 3 would come out of their endowments and what they could recover 4 from some of their properties at the old site. The fund drive 5 has been going on for many weeks Dow and instead of just pour- 6 ing money into it, Jack, as they felt the community would do, 7 they have about $700,000 on the three and a' quarter million. 8 It is not likely. perhaps, that they may,be able to ko beyond 9 a million on the fund drive. 10 MR. BUGBEE: Did your agency endorse their fund 11 drive? 12 MISS JFANKINS: Yes. Not for that amount of money, I 13 am sorry. I should not have said that, George. They endorsed SR 14 the project because they had over a period of three years a 15 very strong hand in the location of this hospital. It had 16 intended first in locating in a relationship with the Universi-ly 17 of Kansas Medical Center. We very strongly opposed this for 18 some very good reasons. 19 Missouri will not pay any welfare payments outside 20 the State of Missouri at all. They would have lost their 21 whole welfare picture out of Missouri, they would have lost 22 much of their properties in Missouri. They have some very 23 fine acreage in Missouri but a good portion of this would have 24 reverted to the heirs who gave it to the hospital had they 25 moved the hospital outside the state. ACE-FEDERAL REPORTERS, INC. 261 CONSTIITUTION AVE. N.W W.S@INGr.l. 0. C. 135 14 1 MR. ROREM: Did you give the area and number of 2 hospitals before I came in? 3 MISS JENKINS: Our area is one of 1,200,000 people 4 involving five counties in two states. In that area there are 5 22 hospitals representing approximately 5,000 beds. 6 MR. ROREM: Thank you. 7 MISS JFNKINS: The 22 hospitals iDclude the United 8 States Air Force.Base hospital and the Veterans Administration 9 hospital. 10 MR. ROREM: Are they big? 11 MISS JF.NKINS: The Veterans Administration hospital 12 is a 500 bed hospital, it is a Very little hospital, and the 13 Air Force Base 50. SR 14 MR. ROREM: How many? is MISS JF.NKINS: Fifty, somewhere around there. It 16 may even be fewer than that. All we know about them, as 1 17 mentioned, Rufus, they wanted to add 15 or 20 beds to the OB 18 departments and all the OB departments on the south side of 19 the city were running a low occupancy. We could not get any- 20 where with them so we went to the Bureau of the Budget and the- 21 never got the appropriation for it. That was a sneaky thing 22 to do and I do not know yet whether the USAF hospital knows we 23 did it or not. All they know is that they did not get their 24 money. It would have been rather pointless, really, because 25 most of these people on the base live in the city anyway. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AvE.. N.W, 136 15 1 DR. KLICXA: I take it you did not send it to the 2 hospital. 3 MISS JENKINS: We did not. The hospital is our 4 member and one of our dues paying members and one of the most I 5 cooperative in the Hospital Association that we would hope to 6 have. We felt like heels about it. They were very fine to 7 t work with. We felt like heels about the little sneaky deal. 8 MR. BURLEIGH: Dontt feel you have it licked yet. 9 MISS JENKINS: This is so little I cannot imagine 10 Congress concerning itself with it, frankly. 11 The osteopathic problem and the Negro problem and 12 the problem of how you develop in harmony and in coordination 13 with a private voluntary hospital system a new medical center 14 SR and potentially a new medical school is a very difficult thing. 15 We have had very little cooperation and planning from the 16 University of Kansas Medical Center because it serves the 17 whole statewide area. We had our first request from them here 18 within the last six months when they felt that ihe planning 19 committee could be of help to them. 20 The Shriners were going to build four burn centers 21 over the country, and one of them they were thinking about 22 building in Kansas City, Upsas. K. U. came right straight 23 to us to exert what pressures we could on getting this insti- 24 tution in connection with theirs. It is a small number of 25 beds which would deal with out of area patients entirely. ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUT ON AvE N W, 0. C. I I 137 16 1 The planning agency approved it and K. U. thought it was 2 wonderful. The next time they want something they may be back 3 I dontt know. 4 With the General Hospital and Medical Center their 5 cooperation with planning has been excellent and I think it 6 will continue to be so. It represents problems which frankly 7 we do not know how to cope with and which the private voluntary 8 hospitals of the.area are extremely apprehensive about, Jack,- 9 as you could well imagine, in the taking of pay patients, part 10 pay patients and so on in this big facility. 11 MR. BUGBER: Is your area over-bedded? 12 MISS JENKINS: It is over-bedded on general beds. 13 We have never had a problem with Hill-Burton regarding general SR 14 beds because we have not had a priority for a general bed in 15 the area since 1949 except that we did work with the two state' .16 Hill-Burton agencies in the redistricting where Missouri had 17 a base area line that cut right through the corporate munici- 18 pality-,Of Kansas City., Missouri, and in the Kai3sas side the 19 the two counties of Johnson and Wyandotte. Johnson County, 20 the suburban county, where the population shoves right up 21 against the line, that was a base area line and we got them 22 to revise their base areas to include the five county, two 23 state area as a single area for planning. That was good 24 cooperation. 25 Jack, didn't you sit with the planning committee ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N,W, WASHINGTON. 0. C. 138 17 1 when they heard Shawnee Mission of the suburban area in 2 Johnson County that already had a Hill-Burton grant approved 3 and they went ahead and built a 65 bed hospital in the suburbai) 4 area to which we were opposed not only in conference but pub- 5 licly and through public disclosure they built it anyway? It 6 is interesting to note it will probably be the best example of 7 what not to do in suburban areas that we have. 8 They built a 65 bed hospital and a nursing home. 9 They cannot get the occupancy of 80 per cent of the nursing 10 home. The occupancy of the 65 bed hospital has beeD running 11 40 to 50 per cent. Their financial problem is simply incred- 12 ible. They have been open a year and they have not even paid 13 for the roof that went on the nursing home which was the first SR 14 unit that was built three years ago. They are operating at 15 $43 a day on the short-term hospital where the hospitals with 16 a full array of service are $35 to $36 a day. Theyare going to 17 add 75 to 150 more beds., they say, if they could get anybody 18 to finance them. I would say their costs woul4d-shoot to at 19 least $50 a day on the thing. 20 MR. BUGBER: How did they get the Hill-Burton grapt? 21 MISS XWKINS: They got the Hill-Burton grant before 22 this redistricting was done when the line was still one county 23 and one district and another. The @nt was secured about 24 1958 before we got the redistricting taken care of, so they 25 went ahead and built. I dontt know, we Dow are probably goinE ACE-FEDERAL REPORTERS, INC. 261 CONST TUTION AvE.. N.W. 11 WA SH INGTON. C, 139 18- 1 to get them back before the planning agency with, What do we 2 do now? 3 There are two or three hospitals that would have 4 some willingness to attempt to operate a satellite operation 5 on this but taking this indebtedness would be a horrible 6 factor. I don't know how they would live with it. I don it 7 know how they are going to live with it. 8 MR. BUGBEE: Who loaned them the money, insurance 9 or banks? 10 MISS JENKINS: George, I don't know. I don't know. 11 They have put out a brochure now to any financing house who 12 will even consider this on a basis of refinancing. I do not 13 see really how anybody can refinance it. Actually the factor 14 is an implementation which is used or persuasion, public dis- SR 15 closure, where one has to. It is unpleasant and has not been 16 done in two instances. 17 DR. KLICKA: How do you do this, newspaper? 18 MISS JENKINS: Newspaper. 19 DR. KLICKA: Do you send out a release? 20 MISS JENKINS: Actually, one of the officials of the 21 Kansas City Star, which is our only newspaper, is a member of 22 the planning agency., one of the non-hospital related individuals 23 on the planning agency. 24 DR. KLICKA: So he sends a reporter out to see you? 25 MISS JF.NKINS: In fact, he writes the story. He and ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE.. N.W. 140 19 1 I sit down and write the story with a reporter. 2 MR. BUGBEE: And I suppose you dramatize it on a 3 television program. 4 MISS JENKINS: No. The largest voluntary hospital 5 in the area was actually done by the reporter on this except 6 it was the planning agencyls decision to and this was not over 7 any major thing. It was a hospital that desired to add in its 8 modernization program 100 beds when it had been approved to 9 add only 27 beds in a part of the reshuffle of the moderniza- 10 tion program. 11 They went out for $2 million, hopefully going to get 12 about $3 million. Their fund drive was completed over a year 13 ago. They have not got the $2 million yet because we have a 14 little control. That is your next factor in the implementa- SR 15 tion, indirect control over funds. Our areas, you probably all 16 know, attempted to put on a united campaign three years ago 17 and it fell through primarily because of one or two hospitals 18 that felt they could get more money on their own, including 19 this one big one really, but major industry is pretty well 20 represented on the planning agency. 21 For example, Ford and General Motors are represented 22 with top executives of both and the corporate giver will not 23 give unless the project has been approved by the planning 24 agency. The report is issued to the hospital and condensed 25 into a letter, and also a letter given to them which they ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE.. N,W. WAS.ILVCION. D. C. 141 20 1 quote from, use. One hospital in fact blew the letter up 2 into a one page ad and bought advertising space in the Kansas 3 City Star'. This was research, Jack, on the big hospital. So 4 you have some element of help and implementation there. We 5 have a great deal of help, we feel, through the Hill-Burton 6 agencies. 7 In Missouri if anybody files an Application that we 8 have not seen, we try to know what these are before they 90 9 in. The state Hill-Burton agency advises us and furnishes us 10 with a copy of the project. We may then call the hospital in 11 and talk about it. We give a report to the state on every 12 project which is before them, and up to this point neither 13 state has ever approved one that we said not to approve. I 14 think again this is possibly luck in good part but they have SR 15 never approved one over our state disapproval. 16 MRS. COLEMAN: How do you state your disapproval? 17 Committee action? 18 MISS JENKINS: Committee action. 19 MRS. COLEMAN: A letter to the Hill-Burton agency? 20 MISS JENKINS: A report, yes. We write a report on 21 each project. 22 MRS. COLEMAN: At the Hill-Burton request? 23 MISS JENKINS: Yes. 24 The nursing home situation, as I sayo is one that is 25 Icreating a great deal of problems. Many hospitals have desirea ACE-FEDERAL REPORTERS, INC. 2 6 1 CONSTITUT1014 AVE.. N.W, 0. c@ 142 21 1 to move in the direction of chronic and long-term care in the 2 nursing home and so on. It takes a hospital so very much 3 longer to plan a project than for Holiday Inn to come in and 4 say we are going to build three of these now, United Convales- 5 cent Hospitals in California say we are going to come in and 6 build a big one. 7 MR. BUGBEE: Is that proprietary? 8 MISS JFANKINS: These are all proprietary. 9 I think we have heard from most of them but the real 10 problem is if you approve very many of these you do satellite 11 your area with nursing home beds. Then when a hospital comes 12 along probably we have one hospital that has been working for 13 five years in cooperation with the planning agency on the SR 14 development of long-term beds and it is a hospital that is 15 adjacent to another big hospital and we started them on the 16 road toward an urban redevelopment project which would clear 17 a big area right in the center of Kansas City and let them 18 share parking lots and laundry and various things and let this 19 one hospital build a sizable number of nursing home type beds. 20 It has taken them five years to get their plans in shape prac- 21 tically for this, and by the time they get around to asking 22 for Hill-Burton money we may have filled the area with pro- 23 prietary nursing home beds. 24 DR. HALDEMAN: Sue, isn't it really skimming the 25 cream off the crop; they have filled up the demand for those ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N,W WAIIIIC@L, D. C@ 143 -22 1 that can pay three or four hundred dollars but you still have 2 this group of public assistance and others that cannot afford 3 three or four hundred dollars that have a real need? 4 MISS JENKINS: That is right. This is what our 5 report will show. However, we are getting some proprietaries. 6 We had a staff conference with one just a couple of days ago, 7 that wants to move into the urban area operators that operate 8 two homes in small towns in Kansas, very good homes. I mean 9 we checked their operation, checked them out with the Kansas 10 State Board of Health. They are going to build facilities 11 that will price $130 to $200,possibly $250 at the top. 12 MR. ROREM: What is that? 13 MISS JENKINS: Nursing home care. These are the SR 14 ones that we want to encourage and do encourage. The ones 15 that are asking four, five and six hundred dollars a month are 16 going to lose their shirts, I dontt think there is any question 17 about it. They still make your area look as if you have an 18 adequate supply of nursing home beds under Hill-Burton when 19 it comes to approving hospitals, do they not? 20 MR. ROREM: I have a theory that the nursing home 21 problem is going to be solved not at all b'y voluntary philan- 22 throphic services but by actions of the two extremes, straight 23 commercial investment for profit at one end and governmental 24 institutions at the other end. I think we can make some 25 passes maybe here and there where it can be done reasonably ACE-FEDERAL REPORTERS, INC, 2 61 CONSTITUTION AVE N,W. 0. C, 144 23 1 well. A general hospital might have a unit. 2 MISS JENKINS: I think it is a limited number prob- 3 ably. 4 MR. ROREM: I bet that is not going to be the 5 problem. 6 DR. RALDERAN: Apropos of that, Rufus, I was very 7 surprised at our recent survey of homes iia'the nation. It has 8 not been published yet except for the summary that showed the 9 number of Dursing home beds has almost doubled since 1954 when 10 we did our last survey but the ratio between non-profit, gov- 11 ernment and proprietary has remained almost constant. I thought 12 the trend would be a higher percentage. Still about 7 out of 13 10 beds are proprietary and about 9 out of 10 homes are pro- SR 14 prietary. So you cannot analyze them that way, you do Dot 15 detect the trend. 16 MISS JENKINS: Yes. 17 MR. ROREM: You do pot detect it towards nonprofit? 18 DR. RALDEMAN: Either way. 19 MR. PETERS: They are keeping pace with each other. 20 MR. ROREM: It varies. 21 DR. RA@MAN: Take Minnesota, for instance; 70 per 22 cent of the beds are voluntary. 23 MISS JENKINS: I don't know what the answer is going 24 to be. I am surprised at the naivete and lack of sophistica- 25 tion of some of these big promoters on nursing homes who rea llr ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AvE., N,W. W."",-" 27. C. 145 -24 1 have not the slightest concept when you sit down and talk with 2 them of what it is to provide care. They think of it in terms 3 of another motel and you hire an RN to be around once in a 4 while and that is the limit. At lunch time I asked if they 5 have a recreational program and they said yes, they have a 6 swimming pool. 7 I donllt know. These are all in anticipation that 8 there will be a Federal program that will pay nursing home 9 care for the aged and they simply want to be in there and on 10 the bandwagon. We really feel if we can provide enough infor- 11 mation showing what the market demand is in the area that they 12 may quiet down a little bit in the building of this more expen- 13 sive type of facility; at least they are reasonable to talk 14 with. SR is We are spending an immense amount of staff time in 16 talking with them, I never saw so many people in my life. 17 They apparently want to start building nursing homes. In 18 Chicago I had seen a tremendous surge of building. Carl,-you 19 no doubt wish to comment on that. I talked to Miss Nickelson 20 in Chicago a week or two ago and she bore this out, the low 21 occupancy in these beautiful big new'..homes and how they are 22 going out and building back to back and in areas that could 23 not possibly sustain them. 24 DR. KLICKA: There are 2,000 empty beds and the 25 trend is to convert them into hospitals. ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUTION AVE. N.W. 0. C. 146 25 1 MISS JENKINS: This would be the most alarming thing 2 we might run into in this. 3 MR. BUGBEE: Portable X-ray. 4 MISS JENKINS: We do not have the support of Blue 5 Cross that Jack has in Detroit. We hopefully are moving in 6 this direction. If we can get our Blue Cross board to have 7 the courage and the guts to go ahead with something on this, 8 this is what it Certainly is going to require. All that we 9 are doing Dow, Jack, is a bit of a cutback on this Shawnee 10 Mission. They are taking a cutback under a special contract 11 at Blue Cross which causes them to lose more money as they go 12 along. I think when Jack reports to you his story on the 13 decision in Michigan on this maybe it will persuade more Blue 14 Cross plans to do this. SR 15 However, when we move into the era for funds for 16 modernization in the urban areas and priorities, I can see 17 this develop as one of the finest dog fights we could ever 18 expect to have,-and I am sure this will occur iii any metro- 19 politari area. Surely there will not be enough money to do any 20 more than a drop in the bucket job at the start on a program 21 such as this. 22 MR. BUGBEE: Such as what pow? 23 MISS JENKINS: Federal funds for modernization and 24 renovation of aging hospitals or plants. 25 MR. BUGBER: You have plenty of them? ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE., N,W WA"I"-,. D, --. I 147 26 1 MISS JENKINS: Yes., we have plenty of them. How you 2 will decide who is up for grabs on this money is going to be 3 an extremely difficult thing. In our area we have a big new 4 General Hospital and Medical Center going up with a replacement 5 building and medical school. Undoubtedly they are going to 6 feel they ought to get these funds; they are already saying 7 this when they come through. t 8 You have some hospitals that are going to have 9 trouble getting matching funds for money. Maybe their need 10 is very great, maybe you cannot do very much towards seeing 11 that they get matching funds for it. 12 David Willis posed a question over a good hot sand- 13 wich during lunch, at a delicatessen incidentally, Should this SR 14 money become avail-able, do you spread it through your area 15 giving a little piece here and here and here, or do you try 16 naturally to determine priorities and try to do a full and 17 complete job with one of them if your money is limited? The 18 det ermiiiatioi3 of priority such as this concerns-us very much. 19 Hopefully I thought some'of the great brains around this table 20 would have some very enlightening ideas about it. 21 MR. ROREM: You came too late. Three years ago we 22 could all have told you. 23 MISS JF.NKINS: Really., it is I think a very serious 24 problem. If Uncle Sam were going to cut loose with enough 25 money to do a complete job with all urban areas in the countr@, ACE-FEDERAL REPORTERS, INC. 2 6 t CONSTITUTION AVEN. W. D. C 148 27 1 this would not pose any problem realizing that it will be an 2 infinitesimal fraction of the job to be done. If you do get 3 such funds, then the determination of these guide lines for 4 priorities become very important. If you don't get them estab- 5 lished and reasonably accepted, you could break up some very 6 good planning agencies over this type of thing. 7 DR. HALDEMAN: You have several communities that 8 have had to face up to that and have faced up to it. We have- 9 one here, Columbus, Ohio. You may not agree with their solu- 10 tion but at least they faced up to it. Rochester, New York, 11 is another one that has. 12 MR. BUGBEE: I think you are a little pessimistic, 13 Sue. I think a little money might be able to cope with it 14 better a little at a time than it might all at one shot. SR 15 MISS JENKINS: Frankly I would like to cope with it 16 a little at a time, even in an area no larger than ours. We 17 are not very apprehensive about it. 18 MR. BUGBER: I did not mean. to indicate you were not 19 entitled to that. 20 DR. HALDEMAN: Any questions? 21 MR. BUGBEE: For the minutes, I think the long range 22 planning committees in each hospital - I do not know that 23 Rufus' Appendix B answers all the problems but it is an 24 awfully nice outline of how to constitute such a committee.if 25 they ever write this up and want to look at it, it is in his ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE., N.W. 149 28 1 Alleghany County book, Appendix B. 2 MR. BAUM.@..@On your fund raising campaign that you 3 are talking about, was this not conducted at the same time in 4 Kansas City, Kansas, or Kansas City, Missouri? 5 MISS JENKINS: On a united effort that did not get s off the ground, is that the one you are referring to? 7 MR. BAUM: It did not get off the ground? 8 MISS JENKINS: No. 9 MR. BAUM: That answers my question. 10 MR. BUGBEE: You mean by that you never got to the 11 money raising part? 12 MISS JENKINS: It was a totally separate organization. 13 It was a community organization, you see. It was not either 14 our hospital organization or the planning agency, it was a SR 15 community organization set up to hopefully get the capital 16 funds necessary to implement the recommendations of the plan- 17 ning agency. The planning agency did not put price tags upon 18 these projects. The community organization left much to be 19 desired in its structuring. 20 The planning agency in the area hospital association 21 certainly endorsed it wholeheartedly. It did not get any job 22 done, however. As a consequence each individual hospital.,went 23 out on its own -- not each, several of them did. Out of the 24 several that did and are still planning to go out on their 25 own, only one of these broke the line with the recommendations ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE.. N W, 150 29 1 of the planning agency. This was the one that went to the 2 public disclosure and did not get all of its money. 3 DR. HALDEMAN: Any further questions? 4 If riot, Dave, you may proceed to talk about the 5 Rochester regional planning board or about Monroe County if 6 you prefer. 7 MISS JENKINS: What is Monroe Codrity? 8 MR. WILLIS: It is the home county for New York. 9 It is a trade association made up of hospitals and related 10 facilities all of a voluntary nature and governmental, not 11 private, covering eleven counties. It includes Rochester., no 12 other very large cities, and some sizable towns scattered 13 around Elmira and Corning. 14 For some years the Council has had a relationship SR 15 similar to the Hill-Burton which Mr. Peters had in New York. 16 In Rochester though, unlike New York City, there was a trade 17 association that had a planning function as a delegated repre- 18 sei3tative of the state Hill-Burton agency. 19 Starting now the regional hospital council has set 20 up a separate review and planning committee within the struc- 21 ture of the hospital council with membership of about forty 22 people on this committee wit h a smaller steering committee of 23 twenty people. The size of the committee structure I think 24 is important as an asset and a limitation at the same time. 25 I think rather than tell you specifically about the ACE-FEDERAL REPORTERS, INC, 261 CONSTITUTION AVE N W. WA SH? NGION D c 151 30 1 projects that have been undertaken I would like to discuss 2 some of the problems that I see in here and I think may be 3 related to some other areas as well. 4 First as to the matter of whether or not an eleven 5 county area wherein the central core of the area is about 120 6 miles away from its farthest point constitutes significantly a 7 single service area, I think it is questionable. A three hour 8 drive from one end to the other, especially when your medical 9 center is that far distant, I question whether or not this can 10 really be done to the fullest extent. The old concept of 11, regionalization, if it is to get beyond just a matter of 12 grading the size of facilities as you proceed out from the 13 core and if it is to get on into a functional differentiation SR 14 and rational utilization of these, has got to obviously depend 15 upon medical organizations and medical staffing. 16 All of the specialists in this eleven county area, 17 or virtually all of them, are concentrated 120 miles away from 18 the more rural areas. In the Rochester area it-is a rather 19 stable population. There are some developing suburbs, none 20 of them mushrooming. It is largely a clearcut distinction 21 between urban areas and rural areas. The rural areas jealously 22 guard their differences from the urban areas and the county 23 boundary is a very important social, political and economic 24 unit to those areas. 25 Every time you have a committee, or at least the ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTI(ON AVE.. N.W, WA ...... ON, a. C.I 152 -31 1 feeling so far is you cannot constitute committees based upon 2 problems or proposed solutions to problems but you must estab- 3 lish committees based on geographical representation. With 4 eleven counties you start off having at least eleven people 5 on every committee. You then have within the urban area such 6 a wide gulf between the medical school and the hospital and 7 the other hospitals that you have a twelfth representative on 8 every committee. 9 Then you must bear in mind that in New York State 10 the Department of Social Welfare and the Department of Health 11. have been battling for some time and the battle as assumed 12 recently is a rather heated debate in the press and in any 13 public meeting, so you have got to have in each of these SR 14 counties someone from Health and someone from Welfare. So you are Dow up to twenty-four members on any committee. .16 The matter of supervision of hospitals, some of the 17 facilities are supervised by Welfare, some are supervised by 18 the Health Department. I dontt know, in New York City we may 19 have been able to overcome some of this. In Upstate New York 20 it has been rather difficult to date. Therefore, I wonder 21 whether such a broad area necessitating such large committee 22 structure for any action has not got in itself some built-in 23 needs of its own making, but be that as it may I dontt know 24 yet. 25 We have the forty member review and planning ACE-FEDERAL REPORTERS, INC. 26 1 CONSTITUT'ON AVE., N.W WAS@(NGTON, 0. C. 153 -32 1 committee which now acts as the Councilfs screening and 2 approving body for all of Hill-Burton applications. The 3 steering committee reports back to the reviewing committee 4 which reports to the executive committee which reports to the 5 entire board of the Rochester Council and then in turn to the 6 state Hill-Burton agency. The Hill-Burton agency has really 7 been quite wonderful. I just had my firsttexperience in 8 sitting with Jack Burke and seeing how they determine bed 9 need. It is a weird and wonderful thing that defies descrip- 10 tion but I have not yet seen a formula which approaches it 11 for good soundness of the end result. 12 DR. KLICKA: Those are inconsistent statements. 13 MR. WILLIS: We will argue later. 14 The approach to date is that before they had a full SR 15 blown planning function the Rochester area has been largely a 16 numerical legalistic sort of planning, largely a determination 17 as to the size and location of facilities with very little 18 inquiring except into the content of medical care programs. 19 Recently the major part of the retention has been developed 20 to two essential problems, nursing home and related long term 21 care facilities and psychiatric facilities. 22 Quite interestingly in the Rochester region these 23 two problems have been brought to focus largely because of the 24 presumed threat of proprietary facilities going into the area. 25 Aside from a single psychiatric unit of Strong Ifemorial Hospital, ACE-FEDERAL REPORTERS, INC. 2 6 t CONST'TUTION AVE . N W 0. c 154 33 1 which is the teaching hospital in Rochester, there is not one 2 hospital in the entire eleven county area which will overtly 3 admit patients requiring psychiatric care aside from the state 4 institution. A proprietary group wanted to build a psychiatric 5 facility and this caused a re-evaluation of the entire program. 6 Now everyone wants psychiatric facilities, anything to keep th 7 proprietary people up. 8 MR. SIBLEY: Did you put this group up to this? 9 MR. WILLIS: No, but I bless them for it. I cannot 10 say that in Rochester but I say it here. 11 The same thing with nursing homes. I do not think 12 this is unrelated to what Sue Jenkins mentioned there. 13 MR. ROREM: With respect to what? Who is concerned SR 14 over sponsorship rather than service? 15 MR. WILLIS: I think the Regional Hospital Council 16 and the civil leaders have been taught to be more concerned 17 'with whether or not it is voluntary, non-profit or proprietary IB rather-than is the service needed or do we have-a better 19 alternative now or in the foreseeable future. I think in 20 Rochester we come up with the same answer that was implied 21 in Sue Jenkins' comment, we would rather do without services 22 than wait for nod-profit. 23 MISS JENKINS: No.. I did not mean to imply that. 24 We have no objection at all to the good proprietary or com- 25 mercial nursing homes, they are very helpful. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N W 0. C. 155 34 1 MR. WILLIS: My charter does not admit proprietary 2 facilities to its membership, which does not put it in a very 3 good position to work with proprietary groups to encourage 4 them to amend-their programs and so on to fit in with some 5 overall planning. The Regional Hospital Council has also 6 taken sides in this fight between Welfare and Health. 7 MR. BUGBER: Which side, the Health? 8 MR. WILLIS: Yes. They have publicly cast their lot 9 with the Department of Health which means that they are on the 10 outs with the Department of Welfare and get very little cooper- 11 ation from that department which is the department overseeing 12 most of the proprietary facilities. This is a kind of unfortu- 13 inate situation. I do not know how you have handled this thing SR 14 in New York City. 15 MR. PETERS: We have not taken sides at the moment 16 although if the vote were taken I think probably Health 17 because of the composition of our board -- probably, I Am not 18 sure -- the state hospital association of New York. 19 MR. SIBLEY: So your association does not agree with 20 your state associatiop? 21 MRS. COLEMAN: Our group is not quite clear in its 22 mind. 23 MR. PETERS: They might go for Health, I think. 24 DR. HALDEMAN: I was interested in the concept which 25 1 have never heard you enunciate, Hi, in implying that an area ACE-FEDERAL REPORTERS, INC, 26 1 CONSTITUTICON AVE N.W W.SH".,ON, 0. C. 156 35 1 wide planning agency was a local arm of a state hospital 2 association. You didn't mean that, did you? If we are con- 3 sistent with our concepts, it seems'to me we have to say it 4 is an independent entity. 5 MR. ROREM: Are you pulling his leg or do you think 6 he said this? I did not hear him say it. 7 MR. WILLIS: He took the position. 8 MR. PETERS: He said we are in New York State so 9 therefore we have a New York State association. 10 DR. HALDEMAN: I think this is an important concept 11 because I do not think an areawide planning agency should look 12 upon itself as a sister organization, as another hat for the 13 hospital association. It seems to me they have to maintain SR 14 that relationship with the state hospital association. is MR. PETERS: It is partly wheia you have the dual 16 role like Jack has and Sue and so forth that you come in 17 contact with the state association. We have no contact at i8 all with the state association. 19 DR. HALDEMAN: I say it was in that context that 20 you made your remark. 21 MR. SIBLEY: As long as it is in your state, that 22 is all. 23 MR. BUGBER: Since you are at a dead end, let me 24 add one thing that has been on my mind for months. I wish 25 we would stop talking about the trade associations when what ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTION AVE N W 157 36 1 we mean are the traditional functions of hospitals. 2 MISS JENKINS: Three cheers. I do not like to call 3 them trade associations. 4 MR. BUGBEE: I don't know who started that. I do not like trade associations used for hospital associations. 6 I trust they are not trade associations. 7 MISS JMINS: We are not a tradd association. 8 MR. BUGBEE: Member association. 9 MR. WILLIS:' I agree with you, it would be nice if 10 most of them were. 11 MR. BUGBEE: All right. Do you want to take over 12 on another argument? 13 MR. WILLIS: Touche'. SR 14 MR. BUGBEE: That is a dangerous viewpoint for 15 planning. 16 MR. WILLIS: I would just like to add a few more 17 points. To go back for a moment to the size of an area 18 encompassed by one planning activity, we run into the problem 19 that we span three different Blue Cross plans, four different 20 medical society organizations in addition to eleven county 21 organizations, three different Welfare Department districts, 22 four different Health Department districts and so on. Whether 23 or not this naturally forms a single area I do not know but 24 it is difficult to margine all four. This will be true in 25 any very large region I think. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ONAVE N,W. WASH.""-O, r) c 158 37 1 So far as the role of the hospital and planning 2 goes, we are going to be aiming at much the same sort of thing 3 that Dr. Rorem outlined, to get the hospital outlined in its 4 own planning. Further, the idea is to get each logical group- 5 ing of counties to set up their own areawide planning council 6 or conference which will be unofficially an arm of the regi onaL 7 planning group but can keep a greater contact with local prob- 8 lems, local needs and relate better both ways. 9 MRS. COLEMAN: Excuse me. How many people are in 10 your area? 11 MR. WILLIS: About 1,300,000 in the eleven counties. 12 MR. ROREM: How many short term hospitals, Dave? 13 MR. WILLIS: About thirty-five. SR 14 MR. BUGBEE: You say how many, 1,300.,000? 15 MR. WILLIS: Yes. About 600,000 in Monroe County. is It is rural area with a few little towns. 17 DR. HALDEMAN: I think you have to use one more 18 statistic on that. How many beds? 19 MR. WILLIS: I donrt know. 20 DR. HALDEMA.W: One thing that I think is in their 21 minds in that area is the manner in which capital construction 22 funds are raised and are distributed. I can say that if the 23 planning council is going to have a force in the distribution 24 of locally raised capital construction funds, the overall 25 eleven county council, the local group will not accept the ACE-FEDERAL REPORTERS, INC, 261 CONSTITUTION AVE: N W. WA,SHft,GTON. 0. C. 159 38 1 dictates for the total final decision on that. Even though 2 Meriam Folsom is chairman of both the planning council for the 3 region and the planning council for Monroe County, I heard him 4 say more than once that the determination of how that money is s spent has got to be largely in the hands of Monroe County. 6 Now what would have happened historically if the 7 regional council had gotten off the ground,prior to the Monroe 8 County, I don't know. Inasmuch as Monroe County came first an'il 9 was a strong organization from the standpoint of planning when 10 the regional council came along.. it posed a real problem for 11 the regional thing. 12 MR. ROREM: You mean to say there are two hospital 13 councils there now? 14 DR. HAILDEMAN: There was a regional council which SR 15 had a membership function and has a long tradition of very 16 excellent service to 'Phe member hospitals. Then Monroe County 17 'Orior to the time the regional councils were given review and 18 planning functions had a very strong patient core planning 19 agency which in effect was a hospital planning -- 20 MR.. PETERS., In New York City, isn"t it, pretty 21 much? 22 DR. HALDEILAN: Yes. It does not have a long history 23 but they had control of all capital construction funds and 24 were able to implement what they did., and I think that has 25 had an impact on the Rochester region. I think it is probably ACE-FEDER.AL REPORTERS, iNC. 2 6 1 CONSTITUTION AVE. NW W.S@INGIO'. 0. c 160 39 1 a sound provision. Where you have a large regional area, if 2 your funds are going to be raised locally there has to be a 3 relationship developed locally with the region. What that is 4 1 am not so sure. I think it will follow some pattern, but 5 the local people will Dot hold still for every decision being 6 made in Rochester, Rochester being a hundred miles away. 7 MR. WILLIS: You have the fund raising in Monroe 8 County which is the patient care planning committee. We hope- 9 to set up in other areas, too, which may report to their 10 local communities so far as the local Deeds of the programs 11 go but which report to the program councils as far as the 12 Hill-Burton goes because that is not the official designee. 13 DR. HALDEMAN: But you hope to provide the staff SR 14 services for these local planning groups, the data collection 15 and analysis? 16 MR. WILLIS: Yes, that is right. 17, MR. PETERS: You are facing exactly the same problem 18 where we had three local Hill-Burton councils, one which was 19 in New York and the others in Long Island, which had a hospital 20 administrator working X number of hours a year on a per them 21 basis part time, which still exists in Long Island. That was 22 a Hill-Burton council with a part time executive secretary an 23 hour or two a week. These two still continue to exist. They 24 are theoretically part of us but have their own stationery. 25 The one in Long Island has recently incorporated, ACE-FEDERAL REPORTERS, INC, 261 CONSTITUTION AVE,. N W W.SH".@ON, 0. C. 161 40 1 become a membership corporation of the State of New York, 2 continues to exercise the Hill-Burton functioning with our 3 blessing. But how do you keep them from breaking away and 4 exercising the total function without our blessing? In other 5 words, we are talking about in Long Island, for.example, two 6 million people more in population than Dave has, and Dave has 7 a problem. I can see right now you can imhgine what the 8 problem is with Long Island with two million people and 9 possibly double within the next twenty years. 10 DR. HALDEMAN: I think we are going to hear from the 11 Columbus regional area. They perhaps have not had their local 12 committees organized long enough to evaluate but at least they 13 are the only area in the country that I know of where there 14 are local committees established in relationship to a region SR 15 wide planning body that is in operation. I think it will be 16 interesting to hear that. 17 MR. PETERS: It depends on which comes first.' The 18 sequence of events I suppose is very important in this whole 19 thing. 20 DR. HALDEMAN: They fortunately did not have to 21 contend with a previously established group. 22 Do you have anything further, Dave? 23 MR. WILLIS: No. 24 MISS JENKINS: May I ask what is your relation to 25 decision making out in these areas removed from Monroe County? ACE-FEDERAL REPORTERS, INC, 261 CONSTITUTION AVE., N.W, 162 41 1 Are you going to allow them a degree of autonomy in making 2 their own local decisions or do they have to be approved by 3 your group in Rochester? 4 MR. WILLIS: If we are going to have any concept of 5 a regional group, at some point it should have some approval 6 from Rochester. I think the greatest responsibility and a 7 good deal of autonomy should go to the local areas. I am 8 convinced myself that you cannot go on indefinitely sticking to 9 counties as meaningful areas, the people just don't live their 10 lives accordingly. 11 DR. KLICKA: Is this the way the state plan is set 12 up? 13 MR. WILLIS: On counties. At best they are willing 14 to accept individual areas, groups of counties. SR is MR. BUGBER: Yes, but your whole area is a region 16 for the state plan. 17 MR. WILLIS: It is a region, and the areas within the region are counties. 19 DR. KLICKA: In other words, your planning would sho,v 20 specific bed needs for each one of these counties? 21 MR. WILLIS: That is rights by county. 22 MR. PETERS: That is right. If you get the state 23 plan which is published each year, you will see it is a tabu- 24 latioi3 of all the counties of New York State listed according 25 to Deed with the ones of the greatest need being on top county ACE-FEDERAL REPORTERS, INC, 261 CONSTITUTION AVE N W 163 42 1 by county; number of beds, percentage of bed needs and so 2 forth. 3 MRS. COLEMAN: Except in New York City where five 4 counties are treated as one. 5 MR. WILLIS: Yes. 6 MR. BUGBER: There is no simple way to do it. There 7 might be wiser and more acceptable ways but I do not think 8 anyone had any data. 9 MRS. COLEMA14: No. 10 MR. WILLIS: I think the best thing that can be done 11 now is work towards perhaps groupings of counties, but on the 12 county boundaries sticking to county boundaries. All the date 13 is only available by the county basis. 14 DR. KLICKA: You use, of course, state lead figures SR 15 in your planning, do you not? 16 MR. WILLIS: Yes, they are worked out with the state 17 DR,. KLICKA: So there is complete agreement here. 18 ..@MR.-WILLIS: We just sat around the ta-ble and went 19 back and forth and in a couple of hours had a-11 the problems 20 solved. 21 DR. KLICKA: Shows what people with good will can do 22 DR. HALDEMAN: Go ahead, Dave. 23 MR. WILLIS: It looks like, to summarize, what I 24 think are in the operation of one agency the major problems 25 we have got to ,,re@p, with the first few years. I don tt know ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE . N W 0. C 164 43 1 what the answers are. One is what do you do in the interim? 2 Until you have got your principles and priorities and some 3 concept of a plan laid out., how are you going to handle the 4 backlog of requests for projects? How large can the area 5 effectively be? What.is the role of the medical school and 6 teaching center? Aside from saying this is the place where 7 you send your special cases, what influenc6 is this really 8 going to have on the operation of the individual hospitals? 9 I think in 'most areas the medical school is a little 10 bit diffident of anything that smacks of community service in 11 an effort to preserve our teaching and research functions. I 12 don't think we can go on indefinitely holding back some of the 13 other areas because of feed back. SR 14 MR. BUGBER: Worth Carolina has some research but I 15 don't know if they can get out beyond it, can they? 16 MR. WILLIS: The thing I have in mind is a hospital 17 that is a 200 bed hospital half a mile from a medical school. i8 Any kind of logical finding should be different-from a-hospital 19 which is 200 miles from the medical school, yet I dare say it 20 is the rare exception where the proximity to a medical school 21 is really affecting the nature of the hospital, its program 22 and so on. 23 Unless there be a very real and close affiliation, 24 which I think is going to be the exception, what should the 25 role of medical schools be. aside from just saying that their AGE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTION AVE,, N,W. 0. C 165 44 1 roles are going to preserve the selectivity of what they want 2 to take in and what feed back they are going to have? 3 DR. ILALDEMN: Again in North Carolina there has now 4 been set up an office so the university teaching hospital is s playing what I think will be an increasing role in community 6 hospitals outside the state. They are working on standardiza- 7 tion of laboratory techniques and a great mai3y things and I 8 think it is possible but you have to set up an independent 9 activity. It caD't be integrated very well. I think there in 10 Rochester you have several examples that are coming about as a 11 part of the patient planning care council that is markedly 12 expanding the role of the medical school within the Rochester 13 area. 14 MR. THEWLIS: Dave, you mentioned the medical school SR 15 itself. I was thinking throughout the country, and this 16 thought has occurred to some of us in the larger teaching 17 -hospitals, whether they are associated with the medical school 18 or not, what impact can they,have or do they have with the 19 hospitals? 20 MR. WILLIS: Yes, I mentioned the considerations. 21 This is not just an academic question. When you get out into 22 an area such as the Rochester area you get into rural areas 23 and the smaller towns. There becomes a very real question as 24 to how much and how far you can expect these smaller groups tc 25 go towards limiting their medical care programs and referring ACE-FEDERAL REPORTERS, INC, 2 61 CONSTITUTION AVE,, N.W. 166 -45 1 things in because in every case the referring doctor is going 2 to lose the case. 3 Now much of this is going to ultimately have to 4 involve our planning not just facilities but I dare say going 5 to have to involve some planning on medical staffing and the. 6 use doctors are making of the respective facilities to which 7 they are entitled to practice. We find in'some areas, for 8 example, right in the City of Rochester that the hospitals 9 that have some affiliation with the medical school are the 10 very ones that are endeavoring to duplicate everything that is 11 in the medical school. Their medical staffs have a taste of 12 some of the things which are available, yet they cannot make 13 full use of all of those things in the medical school setting 14 because of the restrictions on privileges, so they go back to SR 15 their other hospital and that is where they are agitated. I think it is where they are closest with the medi- 17 'cal school they use the greatest energy to duplicate. Where 18 the hospital is far removed from any kind of affiliation it is 19 as if it is less interested and less duplicated in expensive 20 facilities and services. 21 With that I will quit. 22 DR. HALDEMAN: Any questions? 23 MRS. COTEMAN: This is not a question but I think 24 distance has really no part of this, we see the same picture 25 in New York City right within one borough. The little hospit ACE-FEDERAL REPORTERS, INC, 6 1 CONSTITUTION AVE, N,W W4sHl,,,o,. D. C, 167 46 1 is not very ambitious, the one that needs an affiliation the 2 most is the least interested in it. 3 MR. PETERS: It can be a four or five blocks walk 4 away. 5 DR. HALD W N: I think the activities of the 6 Rochester phase in planning their council is au excellent.. 7 example of a situation where the planning 6ouncil does control 8 the distribution.of funds for capital construction and it has 9 a tremendous impact on the area. Initially the hospitals 10 added up the total bill and it came to something like forty- 11, five or fifty million dollars short range Deeds of the Rochest)r 12 hospital. 13 The planning committee knew that they could probably SR 14 only raise at this phase of the construction program about 15 $13 million. The projections, based on utilization and popu- 16 latioin growth, indicated a need in the next three or four or 17 five years of some 500 additional short term beds. In addi- 18 tion they had-one-hospital that was quite obsolete and needed 19 to be replaced. 20 The significant step they took, I thinks is the 21 study of the in-patient population, a review by both inside 22 physicians and physicians from outside of Rochester of the 23 patient population characteristics. In other words, how many 24 patients were in the hospital that did not need to be there 25 by virtue of the medical needs of the patient, and if not what ACE-FEDERAL REPORTERS, INC. 2 6 1 CONSTITUTION AVE . N W, C. C. 168 47 1 type of institution should there be? In some cases it was 2perfectly evident they could be in their own home, others a 3home care program, others on a long term care program and 4whatnot. 5 The upshot of it was that they decided to change the 6method in which they were going to cut the pie. They got three 7of the hospitals to agree to establish what I believe they are 8alliilg Continuation care, you might say, for patients that do 9Dot need the services of short term hospital but do Deed active 10 medical care, with the thought they would go ultimately to 11 nursilag homes. 12 They have instituted a home care program which has 13 grown very rapidly. Last week I was in a meeting with the 14 Visiting Nursing Association. She said there are about 200 SR 15 patients on their own care program, a large percentage of which 16 wou ld be using beds. They are only expanding about 125 beds 17 as contrasted to 500 beds. 18 They have done a lot of other things that go into 19 patient care. They have developed with the community college 20 an associate degree nursing program which all the major hospi- 21 tals are associated with. They are establishing a common 22 aundry. They have considered the possibility of centralizing 23 , rtain expensive laboratory tests, and I think that is still 24 inder study although I think there is an agreement in Rochester 25 -here they have had a long history of cooperation where certain ACE-FEDERAL REPORTERS, I,-IC. 61 CONST'TUT'ON AvE NW DI c 169 48 1 hospitals would do a given test and other hospitals would send 2 samples in to them. 3 They have worked out a program for eliminating the 4 tuberculosis-hospital and transferring the residual hospitals 5 to a county infirmary. They have worked out an affiliation 6 between the university teaching hospital and the county infirm- 7 ary to upgrade the medical care. They ard in the process of 8 transferring the municipal hospital which was a part of the 9 university teaching hospital to the university so that they 10 would be operated as a single unit. 11 These are just some of the activities that the 12 patient planning care council, and I must admit I think it is 13 the top lay leadership because in talking to the health offi- SR 14 cer and some of the physicians I doubt if the physicians would 15 really have gone alo@g,because they wanted more beds, if it 16 had not been for the caliber of the lay leadership in the 17 community. 18 Do you want-to add anything to this? 19 MR. WILLIS: I think there are some interesting 20 differences between what goes on in Monroe County and what we 21 are doing in the western region because the Monroe County 22 planning commission is largely community representation and 23 it has not a label locally nor is it in fact an arm of the 24 hospitals, which means that many of these accomplishments you 25 speak of have been accomplished in spite of the hospital. The ACE-FEDERAL REPORTERS, [,'!C. 26 1 Co"ST'TUTION AVE N.W. WAS@RNGTO, D. C, 170 1 governmental people have an idtereating rezction. They saidp 2 Isi3lt it wonderful to see what can be done when you get the 3 good lay leadership to back up the government., which has been 4 their reaction because many of these things are things they 5 wanted to accomplish. 6 When the planning is more closely related to the 7 hospitals it takes on a slightly different 'r coloration. They 8 are trying to bring the government in to face the purveyors 9 of health care rather than the other way around. I do not 10 know which one is going to have the pattern for the future but 11 it is quite different. 12 DR. HALDENO: Well, we might go on to Columbus then. 13 Grant, do you want to proceed. 14 MR. DPJMAN: I think the previous speakers have all SR 15 outlined the problems we have and are contending with in 16 Columbus. I think Davels situation is probably closest to our 17 own. The type,of organization regional planning is a depart- 18 ment of the federation which is a triple headed-monster and 19 community oriented and a non-profit organization. Our board 20 is composed 25 per cent of hospital administrators., 25 per cent 21 hospital trustees and 50 per cent members at large which repre- 22 sent manufacturers, religion, medicine purveyors of insurance, 23 both Blue Cross and private insurance companies. 24 Our Blue Cross coverage is less than 30 per cent in 25 the general area. The population is somewhere around a million ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION A\,,E . N@ W. WASHINGTON, D. C. 171 I and a half in the regional area, 700,000 of it in Franklin 2 County which is our base county'in which the federation has 3 been operating for eighteen years in the planning, financing 4 and council services field. We have a regional planning 5 committee which operates with the federation and under the 6 federati(>i)fs board of trustees. 7 1 should say here that what I am"saying now is outlined 8 in our guide lines and is being tested. We have three years 9 to make up our mind what sort of structure we are actually going 10 to, use when we get through with the demonstration grant and the 11 study. Thus far most everything that we have set out in the 12 guide lines was found to be workable. 13 The regional committee was not started first. We SR 14 have gone down to the grass roots, so to speak, the same as 15 in Pittsburgh. We have asked each hospital to set up a plan- 16 ning committee or building committee. In some places they call 17 it a bIuilding committee, in others a hospital planning committee 18 for the individual hospital. That is for each hospital within is a community. 20 Then we have gone to the county level and asked that 21 each hospital have a representative of-its board of trustees,, 22 representative of its medical staff and its administrator to 23 serve on the county committee. Along with that we ask the 24 County Health Commissioner, in some cases we have District 25 Health Commissioners which serve two or three of the smaller ACE-FEDERAL REPORTERS, INC. 2 61 CONST TUTION AVE. N,W WASHINGTON. 0, C. 172 I counties, a representative of the County Medical Society, one 2 representative representing all the nursing home operators in 3 the county, and members at large which may be named from 4 industry and others. 5 DR. HALDEMAN: How many counties? 6 MR. DRENNAN: Thirty-six. 7 Six of those counties have no hospitals and most of 8 them are too sma.11 probably to have a hospital, at least we 9 are trying to convince them of that fact. We are going to do 10 some special studies in that area. 11 MR. ROREM: How many short term hospitals? 12 MR. DRENNAN: Fifty-five. 13 I think there are 200 some nursing homes; probably SR 14 50 are nervous, meIntal, tuberculosis and so forth. These are 15 all listed in the guide lines. 16 MR. BUGBEE: Have most of them got county homes? 17 MR. DRENNAN: Yes.. but not all of them have county 18 hospitals. We have a couple that have 9--co'mbinatioii in' 19 geriatrics, or it may be somewhat acute in its function for 20 the presence of the home. 21 We got to the cc>unty committee. These county 22 committees are already functioning in almost all of the 36 23 counties. They discuss problems, shoot us requests for infor- 24 mation and also send us some of their difficult problems. The 25 osteopathic problem is the one we mentioned. In rural areas ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT ON AVE . N,W, IC WASHINGTOf4, D. C@ 173 I we are operating joint staffs, newly built hospitals. In one 2 case the other day the Administrator said it was just working 3 wonderful. 4 MR.- ROREM: You mean a general hospital? 5 MR. DRENNAN: These are two general hospitals that 6 have osteopaths on their staff. The osteopaths are probably 7 in a minority. In each case it will be anM.D. and be accep- 8 table for accreditation by the joint commission. 9 One case is working out well and another is the suit 10 being filed now to break the lease I think on the hospital 11 because they are not admitting osteopaths in their hospital. 12 So we have all kinds of problems there. 13 In the county committee all the hospital voluntary 14 non-profit administrators or governmental administrators are SR 15 in at the county level. 16 MR. BUGBEE,. How often do those county committees 17 meet? 18 MR. DRF.NNAN: As often as they can. We do not staff 19 the county committee meetings at all. We provide data and 20 information. 21 MR. BUGBEE: Do you have difficulty having them 22 meet? 23 MR. DN"AN: Probably one-third of them are metting 24 pretty regularly now. Others, it depends on how serious theix 25 problems are. If there is more than one hospital in the ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE., N.W, 0. C. 174 I county, they are probably meeting more often to discuss their 2 problems. 3 Then we come to a zone committee which is a combina- 4 tion of three, four or five counties which we thought were 5 geographically located. Six months study indicated we better 6 reorient some of our zones because the hospital patients are 7 going more to another zone than the one thtt we had in mind. 8 DR. RAILDEMAN: You set them up before you did your 9 study on patient origin? 10 MR. DEMAN: Yes. We took the 36 county area whici 11 is the dentralldistrti;!t of the Ohio Hospital Association and 12 actually the same counties. 13 MR. BUGBER: Hill-Burton region, too? 14 SR MR. DRENNAN: No, sir, the Hill-Burto@ region is extends all over the map. There are three Blue Cross plans 16 within the region. I dontt know how many Health districts,, 17 a great number of them. 18 At the zone committee we have the chairman and each 19 vice chairman so at most you have at least ten officially 20 designated representatives that come to the zone committee 21 plus members at large, primarily from industry or from the 22 community power structure. 23 MR. BUGBER: Do you staff those zone committees? 24 MR. DUMAN: Yes. sir, every one of them. 25 MRS. COIJMN: @gular meetings? ACE-FEDERAL REPORTERS, INC, 2 6 1 CONSTITUTION AVE NW WASH)Na,ON. D.C 175 I MR. DRENNAN: Regular meetings every two months or 2 so. 3 Dr. Volpe is a roving ambassador, our organizer in 4 our meeting with zone committee people. Ed Lentz does a great 5 deal of the writing.. While lwear two hats, I am very much 6 interested in what goes on in regional planning. 7 MR. ROREM: Full time for each z'ope committee? 8 MR. DRENNAN,. Full time staff members, yes, sir. 9 They go out to the meetings. We have ten zones. Right now we 10 have two staff members. Their time is divided. We are in an 11 advisory capacity. They do not meet without Dr. Volpe or Ed 12 Lentz. 13 DR. HALDEMAN: We did have an application that would 14 provide for three positions in this area. SR is MR. DRENNAN: Four. We are hiring on that basis. 16 DR. HALDEMAN: I did not include the statistician. 17 There were some wonderful opportunities to do some 18 special studies but we had another purpose in this. With the 19 shortage of personnel with experience in this field we would 20 like for some of the areawide planning agencies that have on- 21 going programs to have some young people that are doing a good 22 job but actually looking towards increasing the manpower in 23 this area. The greatest problem we are facing is getting 24 trained personnel for areawide plannil),g agencies. 25 MR. ROREM: Could I just quiz you a little further ACE-FEDERAL REPORTERS, INC. 2 6 1 CONST'TUTIONAVE NW W,5""G@om. 0 C, 176 I on that. Do you mean there are provisions by which, assuming 2 there is work to be done, people can be engaged for jobs for 3 some sort of pay without going through the regular routine of 4 a grant? 5 DR. HAIADE@: No, it has to go through the regular 6 routine of a grant but it is a special demonstration sort of 7 a grant and is the criteria which we evalubte it as different. 8 You have to write up a study of some kind or a service program 9 of some kind. On the other hand it is with the thought of 10 having two objectives, one to strengthen the agency but 11 secondly to provide a. training ground for some bright young 12 people in areawide planning. 13 MR. DRENNAN: I have one from Cornell but little SR 14 experience in the health and hospital planning field, and his 15 primary subject will be investigation of what to do with 16 counties that have no hospitals. He will be going out and 17 'meeting with the county and zone committees under Pete VolpetE 18 guidance but all the time his major concentration will be on 19 providing services for counties without hospitals. He will 20 acquire all the techniques in the planning field and the 21 other studies that go along with it. 22 DR. RAIJ)EMAN: One of the interesting things their 23 initial study showed was that the counties that did not have 24 a hospital, the u-#lization of hospitals by the residents of 25 those counties was 120. ACE-FEDERAL REPORTERS, INC. 2 6 1 CONSTITUTION AVE. N@W WASHt'iGTON. 0. C. 177 1 MR. BUGBEE: Comparable counties or compared with -- 2 MR. DRENNAN: These are all rural counties that have 3 no hospitals. 4 MR. BUGBEE: Is that typical of a rural county, that 5 it has 120? 6 MR. DRENNAN: There is no typical one in our region, 7 George, actually because we have some down'on the border line 8 of Ohio and West Virginia where 65 per cent of their admissions 9 come across the border. So when you link that to the county 10 population figures, you are all out. They have over six beds 11 per thousand down there and it is not enough when you base it 12 on county population alone. 13 Their occupancy rate is still only in the nedghbor- SR 14 hood of 75 to 80 per cent of the roll. That is not typical is but these admissions, it just happens that we have some that 16 are surrounded by territory on which we have reports. We havc 17 'nothing outside the region to compare it with, but tn these 18 counties that have no hospitals they are all in-the 80 per 19 cent admissions that were admitted to hospitals within our 20 region. 21 This much we know. We do not know how many are 22 outside but the captive ones,, I am sure'this is accurate. 23 MR. ROREM: Have you said in other similar rural 24 counties, similar in every respect but having a hospital, how 25 much higher was the annual admission fee? ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT ON AVE. NW I( W-5,Hf'.TON, 0. C@ 178 I MR. DRENNAN: We had admission rates of ninety. 2 MR. ROREM: Ninety'? 3 MR. DRENNAN: Yes. 4 MR. ROREM: That is what I am saying. 5 MR. DRENNAN: Others, 105 or 135. 6 DR. HALDEMAN: It was the average that he was talk- 7 ing about. 8 MR. DRMAN: One hundred twenty. 9 MR. ROREM: I wanted to ask, do you have any theory 10 as to why these particular ones? 11 MR. DRENNAN: I dontt know. We hope to find out 12 within the next year. 13 MR. ROREM: I mean are they a different kind of SR 14 people, O;der or younger, or richer or poorer? MR. DRFMAN: Over 65 or 75 had no relationship in 16 the hospitalization except we know that the over 65 patients 17 stay twice as long. 18 MR. ROREM: What is the ratio of dGcters? 19 MR. DRFNNAN: We are in the process ofei@diing that 20 out, too. Some of these counties are coal mining, strip 21 mining areas, others are just forest areas and they vary from 22 about 12,000 ill population. 23 MR. ROREM: Are these counties of that general 24 nature? 25 MR. DRENNAN: Twelve and twenty thousand. ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTION AVE N,W. 179 I MR. ROREM: The reason I ask that, in suburban areas a 2 district of teD to twenty thousand, a medium sized district, 3 which is a very small district as far as we are concerned, 4 there seems to be no correlation at all between districts, froi, 5 the hospital and number of admissions per thousand. If we 6 probe that a little we might see a difference in the character 7 as far as the number of admissions does not seem to affect it. 8 I dontt know why. 9 Where there are variations there are two kinds of 10 explanations; there are different kinds of people, older or 11 younger,, and we do not have other data. They go elsewhere. 12 MR. DRENNAN: We know from what county every patient 13 came and for our purposes at the moment we think this is 14 enough. We have a big work sheet map of the counties showing SR 15 the number in a six month period that went into each county 16 from qnother county, and it is amazing. They travel 120 or 17 140 miles to come for neurosurgery or open heart surgery or 18 things of this kind. We are only getting into this. We have 19 some data now, we can Pegin to investigate a little more 20 thoroughly. 21 We are back at the zone committee level. Then from 22 the zone just the chairman of the zone committee is represented 23 on the regional committee from each one of these zones, ten 24 members there. So we have screened it out. This may be a 25 hospital administrator. He is the best man in his zone. We ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W. 0. C. 180 1 have no objection to his being on the regional committee- or 2 it may be a health commission, or it may be the owner of a 3 pottery or an Ohio power company is very influential in our 4 rural areas. -We have representatives on some committees in 5 the Ohio Power Company. 6 MR. BUGBEE: How many administrators are there among 7 the ten on your present committee? 8 MR. DRIMAN: I think there is one actually. 9 MR. ROREM-. Big city man? 10 MR. DRENNAN., Yes, as a matter of fact, and he 11 represents all the administrators in FraDklin County. 12 Then we get into the other state power structures or 13 the branches of the state in the region. The United States 14 Medical Association has a doctor in the academy of general SR 15 practice. We have one labor representative in that group. 16 Th e Ohio Hospital Association has a representative in that 17 group. 18 MR. BUGREE: These are the ten zone representatives 19 that you have mentioned and you are mentioning the others? 20 MR. DRENNAN: Yes. We hope the ten we have from the 21 zones are going to be tentacles of the power structure of the 22 zone that they represent. 23 DR. KLICXA: What is your score plus or minus? Have 24 you encouraged successfully or discouraged? 25 MR. DRF.NNAN: I could not enumerate. We have gotten AGE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N W. WASHINQTON. 0. C@ 181 1 rid of a burn center that was tried to be brought in, two 2 hospitals. The newspaper story created quite a sensation; the 3 university wanted it and Childrenlls wanted it and so forth. It 4 ended up I thiDk neither one of them will get it. 5 We discouraged the cancer hospital. 6 DR. HALDEMAN: You have a differentiation between 7 Columbus and the other counties. He has not mentioned it but 8 that Columbus community supervised the distribution of 9 $70 million in the Columbus area since the war and there has 10 been literally no construction in general hdspitals in the 11 Columbus area that has not been recommended by that council. 12 Also, you have handled the actual distribution of funds. 13 MR. DR M AN: That is right. 14 DR. HALDEMAN: You are awarding the distribution of SR i5 funds out of that office. 16 MR. DRENNAN: But the choice of architects and 17 whether they want a yellow brick or red brick or whatever', 18 DR. HALDEMAN: It is unique in the country in this 19 regard to the control, really. The only other place that 20 @comes close to it is Rochester, New York. 21 MR. DRUNAN: He asked some of the failures. We did 22 have 66 beds that were built there by a group of doctors who 23 were not welcome on the other hospital staffs. Started out as 24 a proprietary until they got the loan and got it built and then 25 they took advantage of Blue Cross and other thi@ngs. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTioN AvE.. N,W. 182 1 MR. BUGBEE: In processing applications from the 36 2 counties now? 3 MR. DRENNAN: Yes, sir. 4 MR. BUGBEE: Are they tuning in? 5 MR. DRENNAN: Yes, sir. We were designated before 6 as an approval. We did Dot hand out funds for Hill-Burton. 7 That was Dr. Dubois' provision. He did a'fine job. We were 8 designated by the Ohio Hill-Burton authority as the approval 9 agency for Franklin County. This has been back two or three 10 years now and we had reasonably good success with that. For 11 the 36 counties at least nothing happens down there within our 12 area that Bill Worp or 'AVr. DuBois or some of our staff are nol 13 conversant with or getting argument for or against. It has SR 14 been wonderful cooperation. 15 MRS. COLEMAN: What do you do about Franklin County 16 and the rest of the counties? How do you get these two groups 17 into it? i8 MR. DRENNAN: Well, we have not really-brought them 19 together and yet we have not kept them apart. We have brought 20 representatives together but we would not try to get 55 admin- 21 istrators together. The representatives, we tried to stimulat( 22 these local communities and counties to do a job. 23 MRS. COLEMAN: The counties have some form of organi- 24 zation that meets once in a while? 25 MR. DIMNNAN: Yes. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE., N.W. 183 I MRS. COLEMAN: Then the zones? 2 MR. DRENNAN: Yes, four or five counties. One person 3 from each zone. 4 MRS. COLEMAN: Who comes from Franklin County? How 5 do you get Franklin Co.unty into this scheme? 6 MR. DRENNAN: Franklin County is part of Zone I., 7 There are five or six counties that surroun4 Fra*klin County 8 plus one that is somewhat remote and still very much related 9 to Franklin County. We were originally going to carve Columbus 10 out as a separate zone. We decided against that before we went 11 into the organization. So Franklin County is part of Zone 1 12 and when they meet one representative comes to Franklin County 13 representing the administrator's council. 14 MRS. COLEMAN: You have two-thirds of your population SR 15 represented by one person and the other one-third represented 16 by ten? 17 MR. DRENNAN: No, less than half. Less than half of 18 Franklin County compared to about a million and a half. 19 MRS. COLEMAN: But Franklin County is not the whole 20 of Zone 1? 21 MR. DRENNAN: No. That is right. 22 MRS. COLEMAN: How many people are represented by 23 Zone 1 population? 24 MR. DMMAN: Oh, boy. 25 MRS. COLEMAN: It does Pot matter really but the ACE-FEDERAL REPORTERS, INC, 261 CONSTITUTION AvE N.W. 184 I point is 2 MR. DRENNAN: There are other representatives from 3 Franklin County who come to Zone 1. They have representatives 4 from city planning. 5 MRS. COLEMAN: From city planning only one person 6 comes. 7 MR. DRENNAN: We make an exception in this case. 8 MRS. COLF.MAN: Yes. 9 MR. DRENNAN: In this one zone we do have members at 10 large primarily from Franklin County. If we find people of thE 11 caliber and experience in planning groups and civic groups 12 outside of Franklin County, they will be brought into the zone 13 committee. Since the zone committee is not a determining poli(y 14 committee level you are not too worried actually except keepini SR 15 it a reasonable size. We are not bothered about,the balance o 16 power. Regionally we are, very definitely. 17 . Now where did we get to? We got the regional commit-- 18 tee representing medical, labor, Blue Cross, insurance compan- 19 ies, manufacturing and so forth. All of the zones are repre- 20. sented and this committee meets about every three months. 21 MRS. COLEMAN: That must be a pretty large committee 22 MR. DRFWNAN: About thirty-five'. 23 MR. BUGBEE: When you say they are representing all 24 those zones, they are large but they may come from Franklin or 25 down south or anywhere. ACE-FEDERAL REPORTERS, INC. 6 1 CONSTITUTION AVE. NW WASHIlar.,. D. c. 185 1 MR. DRENNAN: Yes. Ten zone chairmen are there 2 representing the zones. Then the others are people like 3 Margaret Dubois who are there from Hill-Burton in an advisory 4 capacity. There is one labor representative. 5 DR. HALDEMAN: In relation to Franklin County you do 6 really control the distribution of capital construction funds, 7 What is going to be the relationship in som of these other 8 counties? 9 MR. DRENNAN: We are probably going to be an advisor 10 to hospitals and other groups outside of Franklin. When I say 11 "advisor." you have heard very much about the Hoffman Act whici 12 permits counties to hold bond issues to construct hospitals 13 which can be leased back to non-profit organizations. Right 14 now we are advising Cleveland County on that implementation. SR 15 We will do the same thing for the counties within our region in advising Margaret Dubois or Bill Worp or whoever 17 -is going to be in Ohio of the amounts of money that are avail- 18 able from Hill-Burton, from the bond issues which the county 19 might put on, plus any other sources of funds, plus the cam- 20 paign council if they do not have that information to advise 21 them as to two or three companies that we know that are in 22 the business of fund raising and might assist -- not ope, but 23 we will do the same as architects, we will name three good 24 ones and approved and'ldt them make their choice. 25 We do not collect information at this time on ACE-FEDERAL REPORTERS, INC. 261 CONST TUTION AVE,, N W I WASHIINGTON. 0. C, 186 I operating funds, expenses, or sources of revenue. The Ohio 2 Hospital Association does this with the Ohio Health Department 3 They are taking their data such as needed for planning purpose 4 You.ask what the county committees do at the meetings. 5 We have sent out about three planning requirements memoranda. 6 The first one was on what are their plans for the next five 7 years. It was informal but still stated iii writing as to how 8 many pediatric beds, how many medical-surgical beds and so 9 forth do they anticipate they will need by 1970. Also, how io !many private, semi-private, ward accommodations? What is their 11 anticipated cost? What are their anticipated sources of revenue? 12 Does the hospital hand down funds from which this is obtained? 13 I dontt know what we have now. Probably thirty of 14 them are in. At each one of the zone meetings Pete Volpe is SR 15 collecting from the representative. County-wide nursing homes 16 and health care centers Of all kinds are included in this mem- 17 orandum. That is one form. 18 The other is a manpower needs requirement memoranda 19 which has to do with medical staff and per medical personnel. 20 'If they are going to have 500 beds in 1970, how many X-ray 21 technicians, how many nurses, how many doctors and so forth do 22 they anticipate they will need? We are backing this up with a 23 print out from a company in Chicago from all the medical peopliE 24 in the 36 counties which we now have and which we are going 25 over and checking against staff affiliations. So we have them ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTION AVE. N.W WA.,,,cr.,, 0. C. 187 1 by specialty and we have them by age and so on and so forth. 2 Someone mentioned the importance of planning for 3 medical but we want to know where they are. The communities 4 know to some extent where they are. The county in Athens tells 5 us Dow that they have three or four that are up to age 70, the5 6 are going to retire, and where are they going to get some morer, 7 The Ohio State Medical Association has givem their cooperation 8 to a very full extent in this study and they are also working - 9 with us on determination of medical levels, regional center 10 and so forth. If we have a regional medical center in 11 Columbus and Zanesville and Springfield and so forth, what is 12 given there and on down to Marietta or Cambridge or some of 13 the outlying communities. SR 14 MR. BUGBEE: Do you discuss what they should do or 15 what surgery should not be done there? 16 MR. DRFMAN: I do not know what is going to come ou-- 17 of that but -I would say something like open heart surgery, 18 ineurosurgery, some of the other procedures they-would recommend 19 to keep in Columbus. Once again we are not doing this, the 20 medical profession is doing it. They are givi*g us the advice 21 and all we are doing is putting it down and talking it.over 22 with various counties. It may be theoretical or idealistic 23 but we think it is fundamental in the staffing of beds and so 24 forth and the kind of beds you need. 25 MR. BUGME: Remarkable. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE N W, i7, c, 188 I MR. DRENNAN: We are trying lots of things, let's 2 put it that way. 3 We are not doing anything in the disease field now 4 because the City Health Department has a grant from the State 5 Health Department and the facilities for care of both by 6 voluntary health agencies and the hospitals are cooperating 7 and the state institutions are cooperating., When we know 8 something more about their methodology and the success of it 9 -- Ed Lentz happens to be the Project Administrator on that 10 study -- then we may try and apply the 36 county area. 11 We have unfortunately stayed out of the nursing home 12 area because we have been besieged with Holiday I=sand Nursini 13 Inns of America and so on. We did I think block a 300 bed 14 nursing home right opposite Riverside Methodist Hospital by SR 15 the Nursing Inns of America. I think it was twelve stories 16 high and had provisions in it for surgery. Our architect 17 discovered this for us. It could have been very easily con- 18 iterted to a 300 bed hospital with general care. -They were 19 doing it entirely under the guise of a nursing home. 20 General beds were tight, medical-surgical beds are 21 running about 90 per cent in Franklin County and about 85 per 22 cent outside. Like some of the others we are trying to dis- 23 courage any building of maternity beds and converting wherever 24 possible. One hospital in Columbus has given up its ten bed 25 maternity section and another one of the rural counties we hop( ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE. N,W 0. C. 189 1 is going to shortly. Twenty miles to the next nearest maternity 2 section. 3 Now Columbus, we have been collecting data there for 4 eighteen years. We are pretty well certain as to what the 5 trends are there. We will need about 500 general beds by 1970 6 Some of them are already in the stages of construction. One 7 satellite hospital is coming up with about'125 beds. We expeci; 8 to build another.200 bed hospital in the far eastern part of 9 the county. 10 MRS. COUMN: How do these satellite hospitals work',' 11 MR. DU"AN: I don It know, ask Ruf us. Ours won It 12 be open until October 1. It will have no maternity, no 13 pediatrics, no medical-surgical. The laundry will be at the 14 main plant. Mostly administration will be at the main plant. SR is MR. ROREM: I might say I had quite a time getting 16 a project director or the hospitals to allow that name to 17 appear in his final total. He wanted to call it multiple unit 18 hospital. I said that is all right for a scientific document 19 but put satellite hospital first and then submit it because 20 satellite means one of several hospitals under the same manage.- 21 ment. Sometimes the satellite becomes bigger than the home 22 office, but the main thing is the joint management. Sometimes 23 their specialization of patients is quite common, let us say 24 obstetrics can be done at the one. 25 MRS. COLEMAN: Do you arrange this by mergers or by ACE-FEDERAL REPORTERS. INC. 261 CONSTITUTION AVE. N.W WASH,NCTON, D. C. 190 I hospital? 2 MR. DRENNAN: You are talking about satellites we 3 have treated? 4 MR. RORFM: Except one is under construction now. 5 That is strictly an outpost of an existing institution. 6 DR. HALDEMAN: They have had a grant to study exist- 7 ing satellite institutions and have a publication out if You 8 are interested. 9 MR. ROREM,. Just out within the last month. 10 MR. DRENNAN.- This satellite that is going into 11 operation is osteopathic. They have 225 beds now and their 12 present site will not lend itself to expansion. They have a 13 concentration of the staff members in the far western part of 14 the county so it seemed like an ideal situation to experiment SR is on it. 16 MR. BUGBER: Are you going to give medical staff 17 appointments, one staff? 18 MR. DRENNAN: As far as the osteopaths are concerned, 19 I am not sure. We are coming very close in some circles in 20 Franklin County of excellent cooperation between the osteopaths 21 and the others but there was no need for it because we had a 22 very., very fine osteopathic hospital in Columbus which took 23 care up to the present time of all the staff needs of the 24 osteopath. As they continue to grow there may be more and morE 25 pressure. Throughout the Ohio area where the hospitals are ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W. W4sHl,Gr@,, D. C. 191 1 developing there is more and more willingness to accept these 2 kinds of positions on their staff. 3 MRS. COLE3LAN: I was not aware of that. Are they? 4 DR.-HALDEMAN: The number of graduates has remained s fairly constant up to last year when the schc>ol.in California 6 was converted to a medical school, so the numeric drop in them 7 was by virtue of that. This will be offset by the new school 8 in Michigan if they go through, but I think the trend is goine 9 to be towards conversion of osteopathic schools to medical 10 schools. 11 MR. DRENNAN: I think our choice has been the indivi- 12 dual patient's choice, and once we buy that premise then the 13 community has a responsibility to provide hospitals for osteo- 14 paths as well as M.D.s. SR 15 MRS. COLEMAN,. I was a little surprised because we 16 ha ve them in New York City but they are not important. 17 DR. HALDEMAN: I have very mixed opinions and feel- 18 ings on this. As I know some of you know, I have been working 19 lin terms of planning for medical facilities for the last three 20 years. I have mixed feelings. Today post graduate training 21 in medical residency is more and more important in the training 22 of a physician. If you look at even the university teaching 23 hospitals for osteopathic schools there are institutions of 24 100 beds, and you look at the residency :).- training opportun- 25 ities and they are relatively nil. ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE. N.W WASPI&arcll 0. C. 192 I I think we should Him in the long range for upgrading 2 the school of osteopathy. On the other hand, I think I agree 3 with Grant that with the present shortage of physicians that 4 there should be places for them to practice. I would much 5 rather it would be done through opening the existing hospitals 6 to osteopaths rather than continue the osteopath hospital. 7 It is just like the problem of your small Negro 8 hospital. In Kansas City I think that it would be much better 9 for them to be given'staff privileges at Kansas City General 10. in spite of the fact that some of their practice would have to 11. be limited rather than perpetuating a specialized hospital. 12 MR. DRENNAN: This is one good reason for having 13 M.D.s on your planning committees. As you notice we have one SR 14 from each hospital, a representative from the County Medical 15 Society, plus the County Health Commissioner, all on this 16 level where staff privileges may be discussed. 17 We have a number of communities that are refusing 18 them in their hospitals so the M.D.s want to build another 19 hospital with in-patiept beds. It is a problem that we are 20 continually facing. If you do not have the cooperation, I 21 do pot know how you are going to solve the problem. 22 MISS JFNKLNS: Do you have any osteopaths on your 23 operating group? 24 MR. DMMAN: Yes. 25 DR. HALDWN: How late do you want to go this ACE-FEDERAL REPORTERS, INC. 2 6 I CONSTITUTION AVE N,W 0. C. 193 afternoon? I am taking count as to where we stand. 2 I would like to complete the circuit this afternoon 3 if we could and maybe work until five thirty, because in the 4 morning I would like for us to approach this questiop of imple- meDtatioD from a more theoretical standpoint rather than what 6 you are actually doing, what are the areas that have promise,@ 7 and sort of list them. 8 I do not think we need to perhaps talk about -1 9 priorities to any extent because it is evident that our mind 10 has not crystalized far enough on this. I would likeiD then 11 have a chance to talk about whether there is a need for a type 12 of meeting of individuals from staffs of area-wide planning 13 agencies sometime this fall@ and if so, I would like for us 14 to have enough time to maybe just structure such a meeting. SR 15 I was hoping we could work through in the morning 16 until say one o'clock and get away. Does that seem like a 17 -reasonable arrangement? 18 All right. 19 In view of the fact we are going to five thirty, we 20 will take a five minute break. 21 (Whereupon, a short recess was taken.) 22 23 pk fls 24 25 ACE-FEDERAL REPORTERS, INC. 261 CONsrITUT ON AVF,, N.W IC WA.@l,@@ON 0. C. 194 pk/@@hort I DR. HALDEMAN: Dtve, do you want to proceed? f @ Short 2 Hi, I don't want to pass you up. 7-8-63 HEW 3 MR. SIBLEY: Go ahead. 4 DR.. HALDEMAN: You don't represent a planning 5 council. 6 Jacques, do you want to tell us about Detroit? 7 MR. COUSINS: Yes. In sitting here and listening 8 to the other side of the table I feel like the President of 9 Dogpatch Airlines comparing his operations with Pan Am or 10 TWA or Awrican Airlines. We don't do a lot of these things. 11 I guess we ought to and maybe we will but right now we don't. 12 We have about 4 million people. We do the tradi- .13 tional assosication type work amd th6n the hospital planning. 14 The hospital planning is conducted by a planning committee SR 15 which is made up of about two dozen or more people, somewhat 16 over half of whom are public representa@es and the others 17 are distributed among other hospital trustees and hospital 18 administrators and we have the county health officer, the Dean 19 of the Medical School, and the President of the Hill-Burton 20 Advisory Commission on our Planning Committee, all with votes. 21 The staff of the Hill-Burton Agency is invited to 22 attend all of our meetings, and unless there is snow on the 23 ground they do attend all of our meetings. 24 Likewise, I seem to have an invitation to attend any 25 of their meetings whenever they discuss Detroit. ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTICON AvE.. N,W. 195 pk 2 1 We started out by doing population studies and by 2 doing engineering studies of all of our physical plants and 3 then while we were doing this we developed you might say, 4 some criteriacr general policies. 5 one has to do with the size of the hospitals. We 6 like 200 beds of a minimum in the metropolitan area although 7 we will make exceptions in certain circumstances. 8 DR. HALDEMAN: What are the circumstances? 9 MR. COUSINS:: Primarily if it is out in the more 10 3ural parts of the area or if it is in a situation where we are 11 faced with being able to put up a 125-or 150-bed hospital, well, 12 we cannot put up any more but if we don't put that one up or 13 encourage it, some fly-by-night or 50-bed institution will get SR 14 in there, so we kind of bend over backwards. 15 Usually we try to merge the two groups together and 16 we have been successful in a few instances in doing this. 17 We have been doing patient distribution study since 18 about four or five years ago so we know where our physicians is are and where our patients are, and I hope we will be doing it 20 next year again. 21 MR. SIBIEY: Do you have any relation of those? 22 MR. COUSINS@.: No, we just counted noses, where the 23 patients come from and where the physicians have their offices. 24 MR. SIBIEY: But you have not drawn any critera fromt 25 that? ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE., N,W. W.,@".-" 0. C. 196 -Pk 3 1 MR. COUSINS: No, we really have not. We have 2 broken it down so that, for instance, we know how patients 3 pay their bills, you know, length of stay, what kind of 4 specialist they go to and so on and so forth. 5 We have never written anything up on these statistics, 6 We use them almost daily. 7 MISS JENKINS: On your doctors did you get their 8 age and specialty? 9 MR. COUSINS': The age of the physician? 10 MISS JENKINS: Yes. 11 MR. COUSINS: We can get that. We don't have it on 12 the IBM card. In other words, you can name any physician in 13 Detroit and we can tell you where he has his patients in six 14 months. SR 15 MISS JENKINS: We maintain an IBM card on that. 16 MR. COUSINS: We discovered that some hospitals that 17 we thought they were getting the bulk of the man's work were 18 not getting nearly as much and we were able to predict with 19 considerable accuracy what happened to your,hospital, and by 20 physician we can tell you what happened. 21 MR. PETERS: Contact the doctor himself? How did 22 you get the information, contact each doctor individually? 23 MR. COUSINS: No, we told the hospitals we were 24 going to do this and we did it. 25 MR. PETERS: You got it from the hospitals? ACE-FEDERAL REPORTERS, INC. 6 1 CONSTIRUTION AVE NW W4sqt,.,o,@ C. C. 197 Pk 4 1 MR. COUSINS: Yes, we had bushels of mail coming 2 in every night showing all the discharges. 3 MR. ROREM: You mean you do this currently? 4 MR. COUSINS: We did it during the six-month period. 5 MR. ROREM: 225,000 discharges? How many? 6 MR. COUSINS: 225,000 discharges, all on IBM.cards. 7 It is very he lpf ul. 8 Well, on a quarterly basis the staff gives to this 9 Planning Committee, which incidentally over the past seven 10 years has not changed very much, continuity on that Committee 11 now, we give them on a quarterly basis an analysis of need 12 based on population and this does not change very much. 13 Then we show them the number of acceptable beds, the 14 total number of beds in the 10 study areas that we have in our SR 15 six counties, the number of beds under construction, the 16 number of beds that we have approved for construction -- this 17 differs sometimes -- the number of projects that they have 18 approved for future construction, the number of -projects and 19 the number of beds that the Committee has approved for future 20 construction, the number of beds that are being tabled or undez 21 study by name of hospital, and then we have another column , - 22 which is all the projects that have come to the attention of 23 the staff. 24 We have about two projects a month; that is about the 25 average comming to our attention. I would say about 20 percent ACE-FEDERAL REPORTERS, l@'!C. 26 1 CONSTITUTION AVE N,W W@.( N@@o, 0 C 198 Pk 5 1 of them never get beyond the staff because we usually are able 2 to say to these people, 'Well, you want an area where they are 3 over-bedded, 11 or we point out some of the financial problems 4 involved. 5 So about 20 percent of the projects never get beyond 6 us, although any project coming to our attention and they 7 write us a letter and insist on meeting with our Planning 8 Committee, they do meet with our Planning Committee. 9 Now our Planning Committee meets, oh, anywheres from 10 six to 30 times a year, it depends on the volume of work 11 involved. Sometimes they have various projects to consider anl 12 sometimes it is strictly housekeeping work that they perform. 13 Now I think probably the area in which we have been 14 most successful has been in the implementation of this and I SR 15 think the reason for it is because of the power structure in 16 Michigan or Detroit. We are somewhat like in Pittsburgh. 17 You get a few corporations and a labor union to agree 18 on something and it is pretty difficult to buck it, at least ig for any major project. This creates other problems. 20 For example, when we were first set up to do plannin4,1 21 these same corporations and the union set up a capital funds 22 corporation called the Metropolitan Detroit Building Fund and 23 these people took about five years to raise $15 million which 24 was then spent pretty largely on our recommendations after we 25 had spent five years studying the needs in the area. ACE-FEDERAL REPORTERS, I,':C. 261 CONSTITUT ON AvE N,W W.5 INGTO'i, 0 C 199 pk 6 1 They didn't take our recommendations in toto and 2 they double-checked us by hiring Jim Hamilton and Associates 3 to cone in and do a double survey. They didn't follow 4 Hamilton's recommendations 100 percent either. 5 Hamilton's recommendations and ours were almost 6 identical. our nu@er two choice might have been his number 7 five choice. t 8 MR. BUGBEE: Why didn't they follow it? 9 MR. COUSINS: Well, there were a couple of reasons. 10 There were one or two instances of honest differences of 11 opinion where Hamgton thought our recommendation was wrong and 12 we thought his was wrong. 13 Then there were a couple ofother problems. The 14 capital funds corporation covered only three counties in our SR 15 six-county area. 16 Hamilton, of course, studied only the three counties, 17 we studied six. So in our recommendations to the Building 18 Fund we told them if the corporations in their budgets set up 19 "X" amount of money contributions to hospitals they should 20 donate to the Building Fund "X" minus a certain amount because 21 there were three counties outside of this area that have 22 legitimate needs. 23 So you have some responsibilities to these other 24 counties and this is another place where we have a difference 25 but by and large, I think you have to say that Hamilton used ACE-FEDERAL REPORTERS, I,'!C. 26 1 CONS R(TUT'ON AVE, NW W. SH IN<;TON@ L,, C. 200 7 1 our figures so it :6 really a matter of judgment more than 2 anything else. 3 The other area in which we have been able to 4 implement things has been excellent cooperation with our State 5 Hill-Burton program. I cannot think of any project that we 6 turned down that Hill-Burton gave any monies to. I can think 7 of a few projects that we approved that Hill-Burton didn't give 8 money to but no@ the other way around. 9 The other thing is that we have had a very good 10 working relationship with Blue Cross. The first document that 11 we ever published had a list of about 11 philosophical 12 expressions of the new hospital planning. 13 one of them was that we should work closely with 14 Blue Cross, one with the size business that I mentioned, and SR 15 another one was that hospitals should be truly community 16 oriented and not corporate setups,that we have so many hospitals 17 where a proprietary type corporation operates a voluntary non- 18 prof it corporation, 19 We also said that we should give priority to com- 20 pleting hospitals that had been recommended for expansion before 21 we build new hospitals if everything else happens to be equal. 22 We also said that we didn't like to see any expansion 23 of hospitals that had not been built originally for hospitals 24 and that we would turn down automatically any hotel conversion 25 job or motel or private home. ACE-FEDERAL REPORTERS, I!!C. 261 CONSTITUTION AVE N.W. WA9KtN(iTON 0, C, 201 8 1 Then Blue Cross came along a few years later, about 2 three years ago, and set up standards for newly participating 3 hospitals. in these standards for newly participating 4 hospitals one of the standards says that the hospital has to 5 be built in response to demonstrated community need. 6 So when a new hospital applies for participation in 7 Blue Cross, Blue Cross writes us a letter @and says, "Is this 8 hospital needed?" 9 I guess we have had about 18 of these letters in the 10 past three years. I guess we have said probably "yes" to 11 about 10 or 12 and we said "no" to the rest of them. 12 Blue Cross has backed us up on every single one of 13 them except one and that is one where the hospital had started SR 14 construction just about the time these new standards came in. 15 Now it has reached the point where anybody who wants to start 16 a hospital and addition -- 17 MR. BUGBEE: Either a new hospital or an addition? 18 MR. COUSINS: Well, within the past three weeks 19 unless f4icbigan Blue Crossbas adopted new standards, the 20 standards for existing participating hospitals and the 21 additions to existing hospitals are going to have to be 22 approved by us or approved by Blue Cross. 23 Blue Cross will turn to us and Hill-Burton for 24 advice. 25 DR. HALDEMAN: Could you get those criteria and send ACE-FEDERAL REPORTERS, I,'!C. 261 CONSTITUTION AVE N,W 202 9 1 it to us? I got a copy from McCarthy a couple weeks ago but 2 I don't know what happened to it. 3 Have they been formally adopted by Blue Cross in 4 Michigan or was it just a draft we were looking at? 5 MR. COUSINS: No, they have been adopted now. 6 MISS JENKINS: Have they been adopted as that draft 7 indicated? 8 MR. CO-LTSINS: Yes. 9 MR. ROREM: I don't remember having received any. 10 MISS JENKINS: I received one. 11 DR. HALDEMAN: I might say that I hope that all of 12 you perhaps wculd take the mailing list -- do we have a vAilizu,l 13 list of this group? -- and send to us copies of any written 14 material that you have'about what you have been talking about. SR 15 I know in a number of instances ynu do have it 16 written up in one form or another. Is there a mechanism for 17 getting information a-round? 18 MR. ROREM: None that has been formalized that we 19 know of. 20 MR. SIBLEY: Since I left Chicago or since I left 21 theoffice, which is practically two weeks, we have made out 22 a list of the 40 Planning Councils which have executives that 23 we know of and asked them to do the thing that we require, we 24 ask our State hospital associations and Metropolitan hospital 25 Membership councils to do, which is to put each other on their ACE-FEDERAL REPORTERS, I'!C. 2 6 1 CO STITUTION AVE N W Wr.4@.IIITI @l - , , L, C 203 Pk 10 I mailing list so that anything they have to mail goes auto- 2 mtically without coming through our office. 3 That has now just been initiated and we will send 4 this revised list out, I guess, semi-annually. 5 DR. HALDEMAN: Is there some way we can get on that 6 mailing list? I don't know. Ken, do we get it? 7 MR. BAUM: No, we don't. i 8 MR. SIBLEY: I have already written it down, it is 9 in my pocket. 10 DR. HALDEMAN: All right. 11 MR. DRENNAN: I think everybody in New York gets our 12 mailing list. We send it routinely and I think we send you 13 several copies. 14 DR. HALDENAN: We get lots from Columbus. SR 15 MR. DRENNAN: Nonprofit mailing franking. .16 DR. HAIDEMAN: Well, pardon me for the interruption. 17 MR. COUSINS: Now it has gotten to the point where 18 it is almost impossible for anyone to think about starting a 19 hospital in southeastern Michigan without getting tangled up 20 with the State Health Department, Blue Cross or the Hospital 21 Council, because whenever any.-one of these three agencies ever 22 hears about a project -- when I say "hear" I mean I was in 23 Chicago the other day speaking to a group of the House of 24 Delegates of the Osteopathic Association, and I heard about 25 a project. ACE-FEDERAL REPORTERS, I':C. 2 6 1 Co STITUT ON AV!: N W LI 7 204 I Well, copies of this have already gone to our State 2 Health Department and to Blue Cross. Now nothing may come of 3 this but we alert one another immediately and we always tell 4 anybody that contacts us that we have to contact the other two 5 people. 6 So the net is pretty well drawn and it is almost 7 impossible to get around this. 8 Now we.have problems. our problems are osteopaths, 9 small hospitals that do not ever intend to receive philanthropic 10 funds or even Hill-Burton funds, and who in the past have 11 always been able to secure adequate financing. 12 Now this is beginning to tighten up a little bit 13 because as a result of what I guess the community thinks is SR 14 a reasonably objective job I would say, that every major bank 15 in town, many of the national insurance companies, the larger ,16 ones, particularly those that have some sort of a group office 17 or district office in Detroit, contact us whenever they are 18 asked f or a mortgage. 19 This has bean remarkably effective judging by the 20 number of times we get called by different banks as we keep 21 saying we either never heard of this project or we disapprove 22 of it. 23 The hospitals apparently have to hunt a little longez 24 to get this money. So this is helpful. 25 DR. KLICKA: Did this just grow or did you do AGE-FEDERAL REPORTERS, I,'!C. 261 CO-STITUTION AVE . N W W4@ p t %"_., @- n r 205 12 1 something? 2 MR. COEJSINS: This grew. We talked about doing some- 3 thing but our attorneys told us we would get into serious 4 difficulties if we ever called a meeting of the banks and 5 insurance companies to talk about it. 6 But through our service association type work and ou:: 7 relationship with the Health Insurance Couhcil and other groups 8 such as that, this is how it has spread.. 9 We are having nursing home problems now. We hope to 10 get into this. 11 We have Negro problems, that is one of our real big 12 ones. 13 We have a problem in timing. As you may recall a few SR 14 moments ago, I said that we send out these quarterly reports 15 for a Planning Committee showing what the need is in the 16 different sub-areas and how close we are to meeting that need. 17 Well, a hospital will appear before us in 1959 and 18 it wants to build something. Well, we don't like what they 19 want to build or we don't like the corporate setup and we 20 don't tell them "no". 21 In some instances we do tell them. Let's say in one 22 instance we don't tell them "no"/ We tell them that if they 23 revise their project, the corporate structure, we will then 24 consider them. 25 We have a few of these that over the past couple of ACE-FEDERAL REPORTERS, l@!C, 261 CONSTITUTION AVE N W 0. C. 206 13 1 years because of our prodding, because of Blue Cross I prodding 2 because of some work done by the McNearny group in Ann Arbor, 3 they have revised their corporate setup and they have revised 4 their projects. 5 They are now coming back to us but the need has 6 changed in this area. In fact, from here I am going back to a 7 meeting where we have to decide what to do"with one of these 8 which is now as clean as a hound's tooth but there is no need 9 and he owns the land. I don't know what we are going to do. 10 Another problem that we have, although I think it is ii beginning to change a little bit, is with governmental 12 officials. originally they paid no attention to us, the city 13 and county level. Now they are beginning to pay a little more 14 attention to us. SR 15 Certainly the City of Detroit is now asking us to 16 sit in as members of various committees appointed by the State 17 Council or by the Board of Health to decide what to do with the 18 Board of Financing of indigin'ent care, providing psychiatric 19 facilities in the city hospital, in relationship of the city 20 hospital to the Medical School and other things, but we earned 21 this, I think, over the past six or seven years. 22 Suburban officials are still extremely leery of a 23 "Detroit group" telling them what they should do, but I think 24 there are some improvements made along that line. 25 Another problem that we face is in relationship with ACE-FEDERAL REPORTERS, I.'!C. 261 CONSTIITUTior, AvE N W W's@IN.ToN 0 C@ 207 14 1 county medical societies. we have one big one, the Wayne 2 Medical Society, and while our relationship and service 3 association is excellent with them, in the planning work the 4 relationship is very good with some of the members but the 5 County Medical Society is a very difficult animal to work 6 with. They will never commit-@themselves, at least ours won't. 7 They change their leadership every year and this can 8 mean a 100 percent change in the philosophy of the County 9 Medical Society. Sometimes the guys that are in leadership 10 positions don't represent really what the membership feels. 11 So we have some problems there. 12 By and large, I guess you would have to say that as 13 far as implementing things were concerned we have as tight 14 control, I think, as any other area which had hospital council SR 15 and this bothers me, frankly, because I am not so sure that we 16 are that right all the time. 17 one paradox, as a result of our work we have probably 18 delayed the construction of needed good facilities because 19 everybody says we have to study this thing, and meanwhile, 20 somebody else has sneaked in and filled up the vacuum. - 21 I think this is changing a little bit, particularly 22 due to Blue Cross' standards and the fact we won our lawsuit. 23 This means that these fly-by-night operators, I think, are 24 going to have to think twice before they think to build 2S hospitals in Michigan* ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE.. N.W. W..""-,. D. C. 208 is I must say that when the corporation set up this 2 United Fund drive, capital financing, then we had a recession 3 in 1958, I kept telling the chairmn of Ford and Chrysler that 4 they were crazy to let a minor recession delay this fund drive 5 for about two years for the very simple reason that if they 6 didn't kick in the money in capital fund-raising they were 7 going to pay for facilities anyway, because somebody would 8 build these add:(tional facilities. 9 Since Blue Cross in Michigan is financed largely by 10 the big-3 and since Blue Cross in Michigan allows for 11 depreciation, the corporations are in a peculiar position. If 12 they don't give the money, they bargain for it over the bargain- 13 ing table with the UAW and they wind up paying for it anyway. 14 SR So this $15 million drive which was supposed to produce about 15 800 new beds, I think in modernization about 500 or 600 other 16 beds, this thing was delayed for a couple of years and mean- 17 while, we saw almost an equal number of beds put up in 18 situations that we didn't think particularly desirable. 19 MR. BUGBEE: What sort of situations, small 20 hospitals that had an accumulation? 21 % MiR. COUSINS: Yes, 50-bed hospitals that decided to 22 become 125-bed or 150 that decided to become 210 or a new out- 23 and-out construction project. 24 An osteopathic hospital in Pontiac, a new hospital 25 just 10 miles from,Ann Arbor and a few other hospitals of this ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE:. N@W. WASN)NOTON, D. C. 209 16 1 nature, but none of these people are going to the corporations 2 for funds and most of them are not even going to the Hill- 3 Burton for funds. 4 I don't know whether in the future we are going to 5 be able to control this any more. I know that our United 6 Foundation has recently set up a capital gifts provision which 7 intends to set up a blueprint to study and'then to provide the 8 financing for 20 years worth of needs in.health, welfare and 9 recreational activities in the greater Detroit area. 10 Now how effective this is going to be I don't know. 11 MR. SIBLEY: This being a part of the giving scheme 12 on the part of corporations? 13 MR. COUSINS: Yes, five years and they fill up the SR 14 pot and the pot would be empty. 15 MR. SIBLEY: But it is regular giving each year? 16 MR. C(xiSINS: Yes, and they would hope by doing this 17 they could then control things even more than they do now. 18 See, we are faced with a developing medical center that is 19 going to hit the community sorwwhere f or $180 million. Sorne .20 of this will be Governmnt money but a lot of it will not be 21 Government money. This has to be tied in. 22 The last two capital fund drives have been largely 23 in suburbia. Now we are beginning to pay attention to what has 24 to be done downtown. 25 MR. SIBLEY: Do you .,,.@call this positive planning, ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION Ave. N.W wAsHiNGrot,. D. C. 210 17 1 Jack? 2 DR. FLNLDEMAN: Yes. 3 MR. SIBLEY: I certainly agree with You. Now we hav( 4 to face large amounts of money that are going to be needed and 5 not just let it slide along. 6 MR. COUSINS: In a nutshell, Tack, I have pretty well 7 covered what we do. 8 DR. HALDEMAN: I am interested a little more about 9 the implications of the court decision. Idon't know, Jim, 10 whether you were going to talk about that. Is it going to be 11 appealed or is this just the first bout, the first round of 12 a fight that will go on? 13 MR. COUSINS: Well, the court decision was rendered 14 now I think about two weeks ago, and the losers had 20 days in SR 15 which to appeal either for a new trial -- boy, I sure hope the,r 16 don't -- or to appeal to the Supreme Court. 17 This court decision was the situation wherein an 18 existing downtown hospital that had been a grou@ participating 19 hospital for 30 years set up a new corporation and created a 20 satellite hospital in a building that was 35 years old and in 21 the eyes of our Planning Committee and I-Iill-Burton did not 22 warrant having any money put into it in an area where neither 23 Hill-Burton nor our area Council thought there was need. 24 The hospital finally came to our Planning Committee 25 in order to secure our advice but the first thing they told us ACE-FEDERAL REPORTERS, INC, 61 CONSTITUTION AVE, N.W WA../,Gro,. D. C. 211 18 1 was that they had already bought the land, hired the architect, 2 it cost them $700,000 and regardless of our decision they 3 were going to go ahead and do it. 4 We told them they were nuts, that it would cost 5 them more than $700,000,, probably close to a million. We 6 were wrong, they have spent a million and a half already and 7 the hospital is not open yet. 8 They then went to Blue cross to get the participation, 9 and based largely on our findings and on the findings of the 10 Hill-Burton Agency, Blue Cross turned them down. 11 The hospital then sued Blue Cross and we were in 12 court, I think, for the better part of five weeks. Carl was ai 13 expert witness on behalf of Blue Cross and Charlie Laturno 14 was an expert witness on behalf of the hsopital. SR 15 Charlie set it up beautifully for Carl and for me 16 because our attorneys asked him how did he know that this 17 hospital needed to be built and he said, 'Well," he had driven 18 around the neighborhood for an hour and the kind-of houses thal 19 were going up were very similar to those in Chicago where they 20 needed new hospitals. 21 So then they asked him had he ever done any area-wide 22 planning and he said, "Yeah, hundreds of times." 23 We then asked him how he did it and he told us how he 24 did it. We asked if he did it for this particular project and 25 he said,"No," he had not. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTICON AVE., N.W. WAs@iNc,.N, D. C. 212 19 1 Then Carl came along and said how he did it and we 2 told how we did it. Charlie gave a textbook approach to the 3 thing although he had not done it for this particular hospital. 4 Interestingly enough, an important decision which was 5 favorable to Blue Cross was favorable on the point of law and 6 that is that the Blue Cross Enabiing Act may contract hospitals. 7 The judge said that it was not w'ithin his province t:) 8 stipulate that they must contract but then he tore into -- I 9 don't think you are named in the findings by name, I am. 10 The judge disagreed on our determination completely 11 and said we were all wrong and he arrived at his own deter- 12 mination. He just took the population from Macomb County and 13 multiplied by 3.5 or 4.0 and he came up with a figure. SR 14 MISS JENKINS: The judge did? MR. COUSINS: Yes. What the judge ignored was that .16 Macomb's population is all along the southern border of the 17 county and there is a whole string of hospitals anywhere from 18 a quarter of a mile to three miles just south of- that line and 19 this is where most of those people go. 20 Personally, as far as we are concerned, there is no 21 reason why they should not go. 22 MR. BUGBEE: When is the 20 days up? 23 MR. COUSINS: I think the end of this week. I think 24 Friday or Monday. 25 MISS JENKINS: Do you think they have the money to ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AvE. N.W WAS@INGI.I. 0. C. 213 pk 20 1 continue the litigation on it? 2 DR. HAIDEMAN: They have in the Detroit area a very 3 difficult time of filling many beds without the assistance of 4 Blue Cross. 5 MR. COUSINS: Yes, but they get only $15 a day from 6 Blue Cross. Now this has some very serious implications 7 because we have a couple of other projects'that are under con- 8 struction right now. 9 MISS JENKINS: But you were not sustained on the 10 basis of the plan, you were sustained only that Blue Cross 11 does not require? 12 MR. COUSINS: We have another court decision 13 involving that. Now this is the reverse. This is a situation SR 14 of where we approved of a hospital and the Community Planning 15 Commission of this particular community also approved the 16 hospital and the Zoning Board approved the hospital but the 17 City Council turned it down, so there the hospital is taking 18 the City Council to court to force the City Council to give 19 them a permit to build. 20 MR. BUGBEE: Why did the City Council object? 21 MR. COUSINS: The City Council objected because they 22 got something like 10 square miles and they have just had thre? 23 new hospitals under construction there and they don't want any 24 more nonprofit organizations in the community. 25 When we testified in court it was intereatiN to hea@ ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE. N,W WA"?N,-" D. C. 214 21 1 the judge in his opening remarks say that he didn't want any- 2 body from Hill-Burton testifying because he was sick and tired 3 of Government intervention in the county and he didn't want any- 4 body from the Hospital Council and he didn't want any outside 5 experts, this was a matter f or citizens. 6 It is still in litigation. 7 MR. ROREM: You know they say yo'u have not arrived 8 until you have be-en sued a couple of times so that will be 9 next. 10 Have you been hauled into court yet, yourself? 11 MR. COUSINS: No, the Hospital Council has not. It 12 has always been Blue Cross or the hospital or a unit of 13 Government hauled into court but we are always asked to testif,r. 14 I was in three different courts in two consecutive SR 15 days and I had to get my stories straight because I had to 16 reverse it in court hearings. 17 DR. HALDEMAN: Off the record. 18 (Discussion off the record.) is DR. HAIDEMAN: My theory on the record is that the 20 way you win these cases you just worry about them enough. It 21 seems to m we had something on Hill-Burton every month it 22 comes up, just felt like we were never going to get solved and 23 I worried about it enough. 24 MR. SIBLEY: I thought you made John and Bill do youi 25 worrying f or you.? ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N,W. WA@lf,VGIOI. 0. C. 215 22 7. DR. HALDEMAN: I do, but we worry. 2 Purtlier comments 3 Questions? 4 MR. ENSIGN: Jack, the judge's discussion on the S need for the hospital was based on cutting up the area-wide 6 pie in terms which seemed to fit the plaintiff's pattern, 7 the plaintiff gerrymandered this thing to make it work for 8 himself. 9 MR. COUSINS: Yes. 10 DR. HAIDEMAN: What is the implication of this ruling, 11 Jim? 12 MR. ENSIGN: it is difficult to say because it was 13 decided only on a point of law which happens to be in Michigan, 14 enabling legislation. it means different things for different SR 15 plants, some of which have no control whatsoever in the contra:t 16 with them and some plans laid down in the statute with the 17 contract, all licensed institutions and others. The language 18 is different. 19 I would say that we would be very happy about it had 20 the judge supported the concept of area-wide planning. We hop4! 21 that the case would come up where that ruling takes place but 22 if it cows up the point of law is not present. 23 This one would have been turned down and this would 24 have had serious implications. 25 DR. RAIDENAN: There are other Blue Cross groups thai ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE,. N@W WAsmi,.r@,. D. C@ 216 23 1 are planning on taking need and consideration? 2 MR. COUSINS: There are, indeed. 3 MR. ENSIGN: In Arizona, the Arizona plan adopted 4 the same exact language that the Michigan plan has in spelling 5 out what a participating hospital must pay which states that 6 the hospital must have been planned and built in response to 7 a clearly evident need for additional beds'in its community 8 and so forth. 9 Just because you didn't know that this was the rule 10 does not let you off the hook, so there are a number of plants 11 that are picking up this kind of thing. 12 In Arizona, it would help to head off the eight per- 13 centers. in fact, it has caused a lot of bondholders heart- 14 ache. SR 15 MR. COUSINS: Trying to be objective, I sat through 16 most of this trial. If I had been the judge, I don't know 17 which way I would have gone because Dr. Klicka confused me, 18 Hill-Burton confused me, the expert on the other side confused 19 me. 20 My own County Health officer was adamant that it was 21 wrong and immoral. Macomb County mothers had to go to another 22 county to be delivered of babies. 23 The president of my County Medical Society said that 24 there was a need for beds, and by applying the formulas used 25 by myself and Dr. Klicka and forgetting about all the hospitals ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE N.W 217 24 1 'that were a quarter of a mile to three miles Outside the area 2 I would very easily arrive at a very fantastic need for Macoml 3 County. 4 That judge must have been bored silly or thoroughly 5 confused because I think I know what I am doing, I will tell 6 you after having been cross-examined and after having to say 7 why did we use this formula, what formula clid they use in 8 Pittsburgh? what did they use elsewhere? why were they dif- 9 ferent? how did I arrive at 175 population for these particular io sub-areas of the county when Hill-Burton arrived at 192,000? 11 why was there a dif f erence? 12 You know, you get a lot, of experts together and a 13 guy who just depends on ordinary common sense just says the 14 hell with all the experts. SR 15 MR. BUGBEE: That is what he said, I guess. 16 MR. COUSINS: That is what he said, took several 17 pages to say it. 18 So we have a lot of work to do in the-selling and 19 the public relations end of this thing. 20 DR. HAIDEMAN: Well, I think we better get on. 21 Any other questions? I will go to Carl. 22 DR. KLICKA: I will kind of make mine brief, I will 23 have to. 24 MR. SIBLEY: Ten minutes, Carl. 25 DR. KLICM: Ten minutes. ACE-FEDERAL REPORTERS, fNC. 26 1 CONSTITUTION AVE. N.W@ D. C. 218 25 1 I think it is of some nterest to tell you that 2 very early in my work with the Council I have been there 3 now four years as of the first of July I was impressed by 4 the fact that we had no committee organization at all. We had 5 a Board of Directors and that was it. So everything was flush 6 with the hospital field knowing what they did in New York. 7 I proposed a number of special a@ea committees that 8 included on the-membership a number of professional experts 9 and laymen who were active in the health field. 10 There were, I think, five or six of these committees 11 and I was very proud of them, I thought I had structured them 12 very well. 13 Well, this recommendation went over like the pro- 14 verbial lead balloon and I can still remember Mr. Ryerson SR 15 accepting my recommendation graciously but saying, "Carl, we @16 are not going to run this Council this way. We want you and 17 your staff to do the work, you make your recommendations to th..s 18 Board or to the Executive Committee which we wil]L form,"which 19 they subsequently formed an Executive Committee, this smaller 20 @group made up primarily of the officers. Let's see what 21 happens. 22 Well, since that time we have reviewed 161 hospital 23 proposals. Now of this 161, 78 wereproposals for brand-new 24 hospitals. Of the 80 proposals that were for revisions of 25 programs of existing hospitals, whether they would be expansio ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE. N.W 2 3.9 26 1 or contractions or relocations, all but three followed the 2 recommendations that were finally made by the staff and 3 endorsed by the Executive Committee. 4 I want you to know that the key here in being able 5 to do this and to have such a turnover has to do with the 6 fact that we do not do studies in depth as they do in New York 7 We have been the greatest thing 6hat ever happened 8 to Chicago, I g@tss, as far as professional consultants are 9 concerned, because in most of these instances we have urged 1() them to have thorough surveys done. 11 In the early days this got us into trouble because 12 we found ourselves getting into more and more disagreement with 13 the phase of the study that related to bed need and this is 14 because these consultants used the only material that they SR 1,5 could and this was the State survey and plan. .16 The more our research staff came up with data the 17 more we began to appreciate that the State survey and plan was 18 much too generous and inconsisten. 19 We began telling consultants as they cam into the 20 'area that we would provide-@-.them with the bed need recommend- 21 ations and rely on them to do everything else in the hospital 22 which had to do with detailing of the long-range program, 23 internal organizational studies, in relationship to various 24 relationships that they might establish for other agencies in 25 the community and so forth. ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AvE. N.W WA.@haroN, D. C. 220 2 7 1 Then what we have done is to have taken these 2 studies, to have reviewed them and then to have discussed 3 them with our Executive Committee. We have worked very 4 closely with the professional consultants that have come into 5 the area and as far as I can tell, they have been just as 6 happy as we have been and we have been very happy with the 7 relationship that has been evolved. 8 Now with the new hospital proposals we have had a 9 little different set of circumstances. Of the 78 proposals, 10 about 60 of them were proprietary in bature. Every single 11 one of these were proposed by people who had had vast 12 experience in establishment of discount houses and shopping 13 centers. 14 Without exception they wanted to place them in areas SR is where we thought the need was already well met or was to be 16 met by programs that are already jelled and moving along. 17 Sponsorship was not only by the real estate developers 18 but in most instances there were a few doctors who were part 19 and parcel of these organizations. 20 It was difficult to get the details of the organ- 21 izations but most of them were the small corporations of 10 22 people or less. This is the saw kind of a partnership arrang 23 ment you know that permits the owners to take advantage of 24 depreciation on their income tax venture and which is really 25 the big appeal in this whole thing. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AvE N,W 221 28 1 Well, of the 18 voluntary efforts for new hospitals 2 we encouraged 90 and most of these are already under con- 3 struction or have been built and are in operation. 4 one of them is postponed to a later date, one of 5 them is going to end up being a satellite hospital to another 6 one and it is under planning. The remaining ones we dis- 7 couraged primarily through what we call lo'ical persuasion and 9 8 they bought the persuasion. 9 Sixty proprietary instituations got actively dis- 10 couraged. of this 60 that we actively discouraged one was 11 built, and this one I don't think would have been built had it 12 not been for the fact that it was financed pretty largely by 13 crime Syndicate money. That hospital is still in operation; SR 14 however, it is really on the ropes and having a very difficult 15 time. 16 There again, although it is not known, it presumably 17 is being perfused by crime Syndicate money. 18 MR. BUGBEE: What does that mean? DR. KLICKA: This means it is being fed. Pardon me 20 for using a little medical jargon. 21 Now 59 therefor have been discouraged and I think 22 most of them successfully discouraged. Now I would like to 23 tell you a little bit about how we did it because this is the 24 implementation. I would like to use the blackboard for this. 25 one of the things that we have discovered is that ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE., N.W, WAS'l,.,O,, 0. C. 222 29 1 the local officials in the community can be extraordinarily 2 helpful. I won't go through the historical development of thi3 3 but I will bring you up to one that we worked with in the last 4 six months that we think is most interesting and this was one 5 that was a hospital that was proposed in Northbrook, a real 6 nice northern suburb. 7 We learn about these and we learfted about this one 8 through our scouts. our scouts throughout the metropolitan 9 area are primarily hospital administrators. They pick up 10 facts relating to the establishment of these hospitals in 11 various ways. This one waspicked up by -- I think this 12 particular scout happened to be Dave Kinzer who was Director 13 of the Illinois Hospital Association. He saw a small squib in SR 14 the newspaper up there where a group had gone to the Zoning 15 Board and had asked for a zoning variation to permit them to 16 build a hospital. 17 Dave called our office and said, "Carl, do you know 18 about this?" I said, "No, thank you very much." The next 19 move was to write a letter to the Mayor of Northbrook telling 20 him that we had heard about this and asking him if he knew 21 about the services of the Hospital Planning Council for 22 metropolitan Chicago, and if he didn't we would be very happy 23 to work with them in determining whether or not the establish- 24 ment of a hospital in Northbrook would be in the best interest 25 of the community. ACE-FEDERAL REPORTERS, INC, 261 CONST TUTION AVE., N W. WA@.IINCT.I. 0, C, 223 Pk 30 1 We subsequently heard from the attorney of the 2 village saying, "Thank you very much, this is going to come up 3 in the Village Council meeting where the Zoning Board is going 4 to submit their opinion regarding the advisability of giving a 5 zoning variation to this group and you will be permitted to 6 come up and talk to us at the same tire. 7 In the meantime, we did a little bit of scouting of 8 our own. We found out what the physicians in the area thought 9 about this and we learned,fortunately, that they knew nothing 10 about it, which was good because you see, this indicated that 11 these people had not even bothered to talk with the doctors in 12 the area. 13 We found that they were not at all in favor of this, SR 14 they all had staff positions in their hospitals. They knew is somethings about the man who was primarily the sponsor here 16 and they didn't think that he would be a fit sponsor, actually, 17 for a hospital in their area. 18 So when it came to the Council meeting-we talked 19 first'on the basis of our studies indicating that there was 20 a lack of need, we thought, and that if a hospital were 21 established it would definitely cause a hardship to the 22 hospitals that were already supporting this area for reasons 23 well-known to this group. 24 We also felt that the sponsorship of the hospital 25 left something to be desired and we reviewed this. Finally, we ACE-FEDERAL REPORTERS, INC. 6 1 CONSTITUTION AVE. N,W WAS.1h.TOI. 0. C. 224 31 1 pointed out that the plans, and we had seen the plans, were 2 minimum and although they could be approved by the State 3 because they wet their minimum requirements, they were vastly 4 undersized. 15 That is, the hospital was vastly undersized. 6 'totally, it@ only provided for something like 450 square feet 7 per bed, and for a 150-bed hospital we thol ht they would end ug 8 up with a kind of hospital that would not be consistent with 9 the other facilities in Northbrook. 10 Anyway, we developed a case. The doctors spoke 11 from the audience and they made some objections. They felt 12 that if there was to be a hospital certainly they should have 13 been advised of it. They had not been asked whether there was 14 a need and they also didn't like the idea of someone coming SR 15 in and establishing a hospital and possibly bringing doctors 16 up from the City of Chicago, doctors who already were not 17 there. 18 This is vested interest but this is all right 191 because this is all part of the pattern. 20 Finally, Dave Kinzer got up and he spoke against 21 this hospital from the point of view of just good general 22 principles of community hospital planning and the fact that 23 this did not fit into it at all. 24 The attorney for the defense did get up and he 25 talked u and pointed up that in this particular area there p ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE N.W W'SHI .. ON, 0. C. 225 32 1 was a need for some 300 beds and this was in contradiction to 2 our recomrwndations indicating that there was a lack of need 3 of new beds and that the area was already well supplied. 4 This was unfortunate but he was able to do this. 5 1 don't want to prolong this, but the Village Council 6 took a vote and voted eight-to-nothing against the establish- 7 ment of this hospital. ,they were subsequently sued by the 8 sponsors and we had to go through all of our testimony again 9 before the judge, it was a District Court proceedings. The 10 judge has not yet announced his decision but we are hoping 11 that it will be in favor, of course, of Northbrook. 12 Now this technique of using village councils has 13 been extremely effective and we have used it many, many times. 14 The whole case, of course, is that we try through education SR 15 to get the village to make a decision relevant to whether or 16 not they wish a hospital in their area. After they have had 17 an opportunity to review the total picture we think they are 18 in a better position to do this than they would be if they had 19 not had this exposure. 20 Actually, the Mayor raised this question: In the 21 course of our discussion he said, "Dr. Klicka, why do we need 22 to worry about this, why not let Dr. Yoder in Springfield make 23 the decision whether we need a hospital or not up here?" I 24 said, "That is your privilege, but it seems to m you make 25 quite a thing about local governrmnt, that you should retain ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AvE,. N.W WAsHi,Gr.l. D. C. 226 33 1 the decision whether you want a hospital in your community of 2 any type." 3 DR. HALDEMAN: Carl, what authority would the State 4 Health officer have? could the licenser program take con- s sideration in Illinois? 6 DR. KLICKA: That is right. If we were not in this 7 picture, if we had not projected ourselves in this picture, 8 the next step would have been for assuming the variation had 9 been given for this group to subnit their plans to Spring- 10 field. 11 If Springfield would approve their plans on the 12 basis of the physical nature of the plans, then they would 13 proceed to build. SR 14 DR. HALDEMAN: Do you have authority to disapprovo-'----@;Lhe 15 application based on lack of need for the facility? 16 DR. KLICKA: No. This is right but they could dis- 17 approve it 'on the basis of it being an inadequate facility 18 and this would be the only way they could do it. I am going 19 to come to that example right now. 20 MR. SIBLEY: Could they not do it also on the 21 inadequate financing or not? 22 DR. KLICKA: It is possible that they'could now. 23 MR. ROREM: Nonprofit corporation? Proprietary? 24 DR. KLICKA: No, no; this is the new model, this iE 25 the pseudo-voluntary group. This had two corporations. Thig ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE,, N,W. 227 34 1 was to be owned by a small group of seven or eight men and 2 then they were going to lease this on a long-term lease arrance- 3 ment to a nonprofit corporation who would pay rent to this 4 group, but there was an interlocking board. 5 All these members were also on the board of this 6 corporation. 7 MR. COUSINS: That is the Detroit picture? 8 DR. KLICKA: I thought this was the Chicago pattern. 9 Most of them are coming up this way now, this is the fashion. 10 DR. RAIDEMAN: They have not any trouble at all with 11 tnternal Revneue with this? 12 DR. KLICKA: No, not yet. 13 MR. COUSINS: Not so far. 14 SR MR. BUGBEE: The owners must pay tax on the property. 15 DR. KLICKA: These people pay property tax. Thoy 16 pay property tax, of course, on this hospital but that is the 17 only tax they pay. 18 one of the biggest things they want this for, though, 19 is to fool the public into thinking they have themselves not 20 only something for nothing but they have themselves a good non- 21 profit hospital and they are naive enough to think this is so. 22 and it maybe, I don't know. 23 Now this has worked out very well until recently and 24 we are having a serious problem. I want to jump to this 25 because down here at a little place called Lyle,,.it is in ACE-FEDERAL REPORTERS, INC. 261 CONSTITUT'ON AvE.. N @W. WASH(NGrOl@ 0. C. 228 35 1 Gladwin County, there is a doctor who was unable to get 2 staff privileges at the Hinesdale Hospital, he had a residence 3 there but they didn't consider him good enough to have staff 4 privileges. 5 Another hospital here, he is on the staff of this 6 hospital but he is always on probation because he never has 7 his records up-to-date and also when it c@s his turn to take 8 call for the emergency room he is never available. So he is 9 always on probation but he wishes to establish a 150-bed 10 hospital. 11 Now he started this program about two years ago and 12 we were working very nicely with the State on this and I 13 thought the thing was well scotched. The reason it was 14 scotched is because he was waking some serious mistakes. He SR 15 was putting it in the wrong kind of a structure. 16 For instance, he was trying to attach this to his 17 Medical Arts Building and his plan was terribly inadequate, 18 so it was primarily on the plan that he just was not getting 19 anywhere at all. 20 We thought it was abandoned but all of a sudden 21 here in the last few'months we find he is very active. 22 I called the State and talked with Dr. Yoder. After 23 I had talked with his two lieutenants, George Lindsly and Roger 24 sondag, more or less trying to get a progress report on where 25 this thing stoode I got a total clamming up. He said, 'What ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE., N.W. W4@@".,." 0. C. 229 36 1 has happened? I found that Dr. Yoder is having very severe 2 pressure brought on him by both Republican representatives and 3 Democrat representatives to permit this fellow to go ahead and 4 develop his hospital and the argument that they are using is 5 free enterprise. 6 'We cannot interfere with free enterprise in this 7 country, this man should be permitted to build this hospital.', 8 Now, unfortunately, the State plan shows that 9 presumed need for about 300 beds in this area. This hospital 10 in Hinesdale was a 200-bed hospital and just added 150 beds 11 and now has 350. 12 Neighborville has 150 beds and are ready to add as 13 many beds as needed when needed. They are running very 14 comfortably. SR 15 Up here there is another hospital, Winfield Hospital, 16 which is one we have been working very closely with, tuber- 17 culosis, in the process of converting it. It will be open in 18 a year adding 125 beds. This is quite a ways out from Chicago 19 As you talk with these three groups it is obvious 20 to them that the State survey and plan is way, way off and 21 they are very concerned about this. Dr. Yoder said, "Carl, if 22 you are going to do anything about this you better do it real 23 fast because they are moving along with a new set of plans thal 24 I am going to have trouble starting." 25 So a new form of impleimntation, ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE. N.W 230 37 1 1 met with the Joint Conference Committee of this 2 hospital and I have Met with the Administrator of this hospitpi- 3 who is carrying the message to his Board of Directors. This 4 hospital is taking an action and they have written a letter 5 to Yoder Protesting the development of this hospital. The 6 doctors on the staff individually are now writing. 7 This hospital, the Board of Dire'ctors are sticking 8 with Yoder. I don't know whether we are,going to get any Of 9 the doctors to write. It is a very interesting story. 10 There is confusion here as far as the medical staff 11 is concerned, because there are three general practitioners on 12 the staff of that hospital who are using lies and all other 13 forms of defamatory statements against community hospital SR 14 planning, sow of it in protesting against the medical staff 15 taking any position on'@-this. 16 These doctors are suspect of being part of the 17 financial picture of this hospital. We don't know what they 18 will do but we believe that they will also take an action 19 protesting the construction.of this hospital. 20 DR. HALDEMAN: The only fly in the ointment, Carl, 21 is that the State Hill-Burton Agency administering a licensure 22 act is pretty.we7l obligated to approve a plan which meets 23 their minimum standards of construction and equipment. 24 DR. KLICKA: That is right. 25 DR. HALDEMAN: I recognize there is a little gray ACE-FEDERAL REPORTERS, INC. 61 CONSTITUTION AVE@ N@W D. C. 231 38 1 area in there where they may have a little latitude but they 2 have got to act with a fair degree of consistency. This thing 3 has worried me in the administration of the Hill-Burton Act 4 because our act says you shall approve the hospital if it is 5 in accordance with the State plan. 6 DR, KLICK&T There is something even worse than 7 that. 8 DR. HAIDEMAN: I am not saying.that is necessarily 9 bad, it is bad that we don't have our State plans in better 10 order. 11 DR. KLICKA.- Let's recognize and not say it is good 12 or bad, just say it exists. IRt's assume we can be the people 13 who take the brunt of any -- 14 DR. HALDEMN: I was wondering why you didn't aim thi!m SR 15 at the local officials the way you did at Northbrook. is DR. KLICKA: Because Dr. Sinovitz(?) here controls 17 the City Council. 18 MR. ROREM: If you had said that earlier we would 19 have understood. 20 DR. KLICKA: Always leave a question for dramatic 21 effect. 22 DR. HAT.DEMAN: Have you not been hitting pretty hard 23. at the people who have the money for these types of enter- 24 prises? 25 DR, KLICKA: I want to make one point and I will ACE-FEDERAL REPORTERS, INC. 2 61 CONSTITUTION AVE. N@W 232 39 1 answer. 2 One of the big problems that we are having here in 3 trying to help Yoder, recognizing the fact that he has son* 4 limitations, is that he has not kept us informed about this 5 particular program. 6 They usually have talked to us about other programs 7 that have gone on but this one he has not.' Now I recognize 8 that he has been.under such great pressure down there regarding 9 this. 10 When I pressured him as to why he didn't keep us in- 11 formed he astourdeS me by saying on that they have to maintain 12 confidentiality on some of these cases. 13 They refer to the Hospital Licensing Act, and I am SR 14 going to quote: "The Department shall make or cause to be 15 made such inspections and investigations-as it deems necessary 16 "Information received by the Department through fileil 17 reports, inspection or otherwise authorized under this Act shall 18 not be disclosed publicly in such manner as to identify 19 individuals or hospitals except in a proceeding involving the 20 question of licensure or revocation or in other circumstances 21 that may be approved by the hospital Licensing Board." 22 This is something I think we will want to get into 23 tomorrow. The only reason I am mkking this point is that in 24 trying to implement you have to use all kinds of methods, even 25 to the point of trying to get around, if you will, legal ACE-FEDERAL REPORTERS, INC. 261 CONST(TUTION AvE., N.W. W.S"Nar@,. D. C. 233 Pk 40 i obstacles to what I sincerely say are probably good attempts 2 at Regional Hospital Planning. 3 Naw in our monthly report we make a point which I 4 keep referring to relevant to the relationship with the State 5 agencies. 6 This is another reason, George, that I am going into 7 this in some detail, only to point out to you the obstacle 8 that we have here in trying to implement something which we 9 believe is proper. 10 MR. BUGBEE: Haven't you got any Democrats or 11 Republicans on your own Board? 12 MR. SIBLEY: This is the next step. I think what we 13 have to do if we cannot get this changed is not on our own 14 Board but to get people down in the legislature whom we can SR 15 use to counter pressure the Director of the Health Department, is push this where necessary. 17 DR. HALDEMAN: Imust be defensive of the State Hill 18 Burton Agency, Mr. Sibley, because I have to administer a Hill- 19 Burton Act presently. 20 There is lots in it I don't like and believe rw, we 21 get a lot of pressure on certain projects in which we are 22 powerless to act. I think the answer is to change the 23 legislation and not to require the Hill-Burton Act or try to 24 get the Hill-Burton Agency to do something which is contrary 25 to Dr. Yoder. ACE-FEDERAL REPORTERS, INC. !61 CONSTITUTION AVE. N.W W4,HlNcr@l, D. C. 234 41 1 MR. SIBLEY: I am all for that. 2 MR. BUGBEE: I don't think the pressure is an 3 adhesive member of the Administration. I am assuming that if 4 this fellow has pressure it is the Governor or somebody like 5 that. 6 DR. HALDEMAN: I happen to feel that Frank Yoder 7 tries to do what his best. 8 off the record. 9 (Discussion off the record.) 10 DR. KLICKA: I want to make just one last point. 11 I am really mixed up at the moment with four years 12 of experience now with regard to voluntary license, voluntary 13 planning relevant to franchise planning. I think if I am 14 on one side or the other I am stronger for the voluntary side SR is now than I ever have been before, particularly with my recent 16 experience with this. 17 MR. ROREM: What do you mean on the voluntary side? 18 DR. KLICKA: I am talking about the system we use. 19 MR. ROREM: I donllt quite know. As opposed to 20 what? 21 DR. KLICKA.- As opposed to ba@ing the decision as 22 to whether a hospital can be built or not in a manner that 23 can be determined by law by some State agency. 24 One of the things that we are not is that we are 25 not subject to pressures. ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVE.. N.W. WAS.;NGro" D, C. 235 42 1 MR. ROREM: Do you mean, though, that the State 2 agency now has too much power or too little or which? 3 DR. KLICKA: I am saying this: that with the powers 4 they have they must administratively be subject to the types 5 of pressures that a political politician can bring against any 6 politic party. 7 MR. ROREM: But you leave it that way, you get your 8 pressure in there too, is that it? I am serious, Carl. I am 9 not trying to be f unny. 10 DR. KLICKA: I know you are. I say this: this is, 11 I think, the way it has to be done. 12 DR. FAIDEMAN: Well, I would like to paraphrase what 13 Mr. Sibley has said, that I don't think implementation can be 14 either public or private, I think it has to be a combination. SR 15 We have got to use all means, and some of those are Government 16 and some of those are not. 17 1 would not want it in either one hand or the other, 18 but I would want it in an effective combination-of private and 19 public. 20 DR. KLICKA: This is precisely why I am not unhappy 21 with the situation as it exists at the moment. In other words 22 I am saying that now what we do have is a combination of both 23 and I think we have to be very careful before we throw more 24 authority for implementation into the law because of the dange:s 25 of political pressure in this field. I thi@ this is a very, ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AVF.. N.W. 236 43 1 very dangerous area. 2 For many, many, many years people have pointed to 3 the Savings and Loan Act in Illinois as being an example of 4 the way this could be done. I realize now that the Savings 5 and Loan Act is running into great problems -- that is, the 6 Administration in Illinois -- and the people who are running 7 savings and loan organizations in Illinois,are saying that 8 the law is not effective because when the chips are down the 9 director who has the ability to determine whether or not the 10 savings and loan institution will be built on the basis of 11 need finds himself subject to such political pressure that 12 unfrotunately, he goes in the direction of the greatest need. 13 DR. HALDEMAN: I think we are going to have to 14 adjourn. SR 15 Do you want to reconvene at 8:30 in the morning? 16 (Whereupon, at 5:30 o'clock p.m., a recess was taker 17 until Tuesday, July 9, 1963, at 8:30 o'clock a.m.) 18 19 20 21 22 23 pk/Short 24 25 ACE-FEDERAL REPORTERS, INC. 261 CONSTITUTION AvE. N.W