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Interview with Paul Ward 
Date:  August 6, 1991 
Interviewer:  Dr. Roger Egeberg
Location:  Fair Oaks, California
Transcriber:  Techni-type Transcriptions/DDR


Egeberg:  Paul, in your view, why were the RMPs established?

Ward:  In the first place, I think much of the money that we had
been throwing into research nationally, from both private and
federal sources, had begun to bear real fruit.  The Johnson
administration appointed the DeBakey commission, and the DeBakey
commission was straddled with the task of determining how these
new resources could best be distributed and how the old resources
could be brought to bear upon the health needs of America.  As
you'll recall, California provided much of the staff and they
met.  Barhoni [phonetic] was principal in that staff on the
DeBakey commission, so we followed it very closely as we went
along.
     In the beginning, to be very brief, it really decided that
there should be Regional Medical Programs built along the example
in New England.  I think it was called the Brookline Regional
Program or something like that.  I just forget what it was now,
but it was based upon tying all the resources of northern area
together around a center of excellence, a medical school,
essentially, or very high powered hospital, and then having the
smaller hospital feed into the medical center for the very
complex cases, and having the providers out in the community feed
into the smaller centers and eventually feed into the big center.
     But as the DeBakey commission went along, organized medicine
and the hospitals became very fearful of mandating a regional
medical approach to all of this, because the physician practicing
out in the community thought that he'd get swallowed up in all
this and he'd lose all his patients to the medical center or to
the center below the medical center.  So AMA was very successful
in forcing a change in the program by the time it became
legislation. 
     When it became legislation, everybody was very aware of this
massive technology that existed for CCUs, ICUs, the beginning of
the r_____ disease improvements, and all that--cancer dysymmetry,
rehabilitation in stroke.  They were aware of the progress that
had been made, but at the same time they knew that a lot of that
progress wasn't reaching the average citizen out in the
boondocks.  So there was kind of a compromise worked out with AMA
to get the legislation going, in which they said Regional Medical
Programs really meant educating the people out in the boondocks
as to how to provide the highly sophisticated services and
creating cooperative arrangements.  And they underlined the words
"voluntary, cooperative arrangements" all through the
legislative--

Egeberg:  In the pattern that medicine is now practiced.

Ward:  Right.  To maintain the status quo, but at the same time
educate the people down below as to the new innovations that come
about in heart, cancer, and stroke.  Obviously a lot more had
been done in the field of CCUs than anything else.  We had just
discovered monitoring.  Twenty-five, thirty years later now, it's
hard to believe that nobody knew what monitoring was then.  You
could say, "We're going to monitor this patient."  They thought
you meant that you were going to stand there and watch him.  But
all of a sudden, people realized that you could attach these new
devices that the electronics industry had come up with to
patients and they'd sound an alarm if something was going wrong
with the patient.  Today we accept that just as if it had been
with us forever, but that was brand new in those days.  There was
just a multitude of use in medicine, the new electronics, and RMP
was seen as a device to put that new knowledge into practice at
the local level, outside of the medical schools and the large
hospitals that knew how to do this.  
     Through the voluntary cooperative arrangements, it simply
meant that you were going to create a structure by which you
could educate the smaller hospital personnel and the practicing
physician in the community to use all of this new stuff that had
come on the scene.  It was that simple.  Where that was done, it
succeeded.  
     Why was RMP developed?  It evolved because the external
pressures on medicine to disseminate knowledge that had been held
up for a long time in the medical schools, the centers of
excellence, and in the electronic technology industry, and it
just wasn't getting out to the field.  And they wanted the term
"voluntary" in there.  The term "voluntary" became sacred.  It
meant that medicine wouldn't lose out in its [unclear].

Egeberg:  You could see how that really brought organized
medicine into health and cooperate with you.  Didn't they
originally--the California Medical Association--print a lot of
brochures for us for nothing?

Ward:  We had a history of anticipating legislation, and even
before RMP was passed, that was 89-239, published in 1939. 
Before that was passed, we had called the deans together, if
you'll recall, and we had said this program might get passed, was
coming down the pike, and that we ought to take advantage of it. 
We also called the hospitals.  I was secretary of health and
welfare at that time.  We called the hospitals and the medical
people together, along with the voluntary associations, and we
said, "This program is coming down the pike.  We all ought to
work together and put together the best possible program."  

Egeberg:  At that time you were in charge of health and welfare
for Governor Brown?

Ward:  Right.  I was secretary of health and welfare for Pat
Brown.  Barhoni was still very instrumental in the staff of the
fading-away DeBakey commission, and Barhoni was very well known
to the medical community for having been involved in this.

Egeberg:  Pardon me.  Didn't the medical community react very
strongly against the DeBakey report at first?

Ward:  Oh, yes.  They opposed it very strongly.  It was sort of
funny, because without getting into personalities, the CMA was
going to oppose the program unless it became the designated
person to receive the funding.  They put in a grant application,
they received the funding, but it was understood that that
funding, then, would be turned over immediately to the CCRMP and
that I would direct the program.  I consented to direct the
program for that short period of time.  I didn't intend to stay
in it for ten years, but I did.  But anyway, the idea was that we
would get it started, we would see that CMA was equally involved
with the medical schools, with the voluntary associations, and
with the hospitals.  We designated seats on CRMP board of
directors to indicate a kind of strength, and that became the
advisory committee, one that approved all the projects.

Egeberg:  Was that the committee that had representatives from
CMA, the Hospital Association, the Cancer Society, the Heart
Society?

Ward:  All the voluntary associations.

Egeberg:  That really had all the voices of any import in it.

Ward:  Right.  In other words, we had a board of directors for
the corporation.  CCRMP was the corporation.  I was the CEO of
the corporation.  You were the chairman of that corporation for a
long period of time, and then Tupper became chairman of that
corporation.  I ran the corporation on a day-to-day basis.  The
board of directors was composed of three members from the CMA,
three members from the Hospital Association, the president of the
Heart Association, Cancer, Kidney Disease, and the stroke program
here in California, and then the eight deans of the medical
school.  Now, that made a board of approximately twenty-one, as I
recall, or twenty-four.  I was on the board, too.  Then for the
advisory committee to approve the funding of the projects, it was
expanded by eight citizen members, and they were called the
public members because the law required that there be public
members.  So the board, combined with the public members, became
the advisory committee.

Egeberg:  And that was about twenty-nine.

Ward:  Yes, twenty-four, twenty-six.  I forget.

Egeberg:  It was a pretty big number.

Ward:  But it was a big number.

Egeberg:  When did you become the CEO?  Before anything happened,
or had [Dr. Robert Q.] Marston been out here and got us, for
instance, hooked to the idea before that?

Ward:  Marston wasn't in the program in the beginning.  He might
have come out; I don't know.  But I was in from the inception of
the standing of the grant.  The grant was awarded to the research
arm of CMA in a technical way so that the grant would be sitting
there.  I recall the thinking.  It was $239,000 to get the
program started.  No money was spent until I came into the
program.  I spent the $239,000 to organize the corporation and to
get the staff.  But it was one of the first.  I think what you're
referring to is the putting together of the grant application for
the $239,000.

Egeberg:  Well, Yorty [phonetic] and Marston came out, and I
don't know how big a group they spoke to and whether they came
together or not, but they were selling it.  Marston later became
the head of it.  I thought it sounded like USC was a school that
really belonged to the community more than most other schools,
and we were right on the edge of the Mexican-American part of Los
Angeles, so many of our patients were there from, and I was a
dean who came up from the other side of the track.  In other
words, I didn't come up the academic stepladder.  I came in as a
hospital man from the VA [Veterans Administration] and then L.A.
General.  But I got sold on that and I thought it was a good
idea.  I had to sell it to our executive committee, because they
were a little bit worried, for one reason or the other, and the
university was worried that we might get committed to something
that they would have to pick up.  
     But we finally got it okayed within the schools so that we
could make an application.  I don't remember--were you already in
it when we made our first application?

Ward:  No.  See, the Department of Public Health was involved in
the first application.  Breslow and Barhoni were very active in
pushing the thing.  I approved the participation of the
department in the original grant application, the original grant
application being the $239,000.  The Brown administration ended
just about that time, and Reagan became governor.  So I resigned
that January and then became the executive director--then they
called them coordinators.

Egeberg:  Was this January of '67?

Ward:  Right.  

Egeberg:  In your view, Paul, why were the RMPs established?  I
think you showed why and then got into the how.  Don't you?

Ward:  Yes.  Well, let's talk a minute about how they evolved,
because there were a large number of RMPs in the United States,
and I forget exactly how many there were now, because I think
they were all given a great deal of independence.  In fact, that
was absolutely essential if they were to be voluntary and if they
were to meet the criteria that Ben set forth in the compromise
that had been reached with organized medicine when the bill was
passed.  If they were to be funded by the national RMP committee
that contained some of the people that had been involved in this
compromise, naturally they had to be somewhat different.  
     But I think most of them recognized the technology and
recognized the need to bring that technology down to the level of
the average patient.  We talked an awful lot about bringing about
high quality care to all patients, no matter where they lived. 
That was an idealism, of course, that was very, very difficult to
realize.  But I think it was an idealism that guided most of the
RMPs throughout the United States.

Egeberg:  Didn't they feel--and feel that way on purpose--that
they shouldn't give too many instructions, because they wanted to
see how it was solved in various areas?  Didn't they also want
that?

Ward:  The national committee was very deliberate in that regard. 
They wanted a decentralized program and they wanted a program
that would involve from the bottom up and not from the top down. 
But they wanted that program to deal with education, primarily,
and technology.  It wasn't until, of course, the Nixon
administration came in that we began to deal with the concept of
creation of new services to meet people's needs.  
     There developed a kind of strange emphasis up until 1970, I
think, that emanated from the national administration, and that
was they really wanted to develop new levels of service delivery. 
In other words, they wanted to create manpower like the assistant
physician.  The guy that sat way out in the boondocks with
absolutely no doctor, but he had a lifeline or a live telephone
line to a doctor someplace, somebody came in with a snake bite,
he could provide first aid up to a point.  But when it went
beyond first aid, the physician assistant then had to call the
doctor, and the doctor gave him instructions over the telephone
about how far he could go, what he could do, and all that kind of
stuff.  
     A lot of those concepts developed out of a program called
the Witchy [phonetic] Program that was out of the University of
Washington in Washington State.  They had been trying to develop
a medical school attachment to Idaho, to Montana, and way up in
that area, because there were no medical schools in those areas. 
Those people really needed a lot of medical care at times, and
they didn't have it in the boondocks.  So people saw in levels
like high tech nurse and assistant physician and a lot of those
categories of technicians that operated in dysymmetry and testing
and all that stuff as new levels of manpower.  You remember they
even developed a program called AHEC.  I don't know what it
stands for, but AHEC was manpower education.  Manpower education
was instructed to work with RMP to develop these new levels of
manpower.  They thought a lot of medical care could be delivered
more simply and more efficiently and more economically through
the different levels of manpower.  
     Well, to throw in a parenthetical phrase here, before, in
the fifties, the technician ratio to the physician was about one
to one.  There was one technician for every physician.  After
this program and twenty years, thirty years down the pike, the
last figure I saw, you know way up in the thirties and forty
technicians per physician.  It might even be higher than that
now.  So this idea was a budding idea that you create technicians
to run budding electronics that were coming into the field.  The
assistant categories, the high tech nurse categories, the CCU
nurse categories, the intensive care nurse, all of these high
tech people that would deliver a lot of care and get the high
trained physician and the high cost physician at another level,
where it wouldn't be so expensive.  It doesn't really work that
way because these new labors of technology expanded so fast that
they had to be paid salaries, too.  Their salaries, although not
as high as the physician, was added on to the total cost of
medical care.  
     Of course, it was the great influx of technology that people
seemed to forget about, that added to the cost of medical care. 
Imagery machines, your high tech radiology, all of this stuff was
the high cost that came into medical care, and it's why you have
high costs.

Egeberg:  But they did say in there that none of this money was
to be used strictly for patient care.  It had to be teaching. 
Wasn't that it?

Ward:  There is no cost to be borne by the program that dealt
directly with delivery of medical care.  So later on when we
formed, in California and other states, the rural health centers,
although they were funded sometimes out of other programs, the
economic development programs and all that kind of thing, we put
together early on the Fresno program, for example, that delivered
migrant health care, the program down here that Stanford put on
for the very poor people in that little fishing community.  But
funding was provided for the actual care itself, either from
Medicaid or from economic opportunity or from rural health, and
we just provided the physician training and the other training,
and the organization and the management of those particular
centers.  We really managed those centers.  

Egeberg:  It seems to me that when we first started our program,
the idea was that we would get some promising person who was
interested from one of our outreach places and have him come to
the university and learn what they should know about the recent
advances, presuming he knew what had been going up until then,
the recent advances in some particular phase of medicine.  We
decided after a while, or I think almost at the first, that this
wasn't going to make this thing alive, so we decided--and I'm
pretty sure we were the first ones to decide--to carry this on in
the hospitals we were trying to reach.  
     So we established teaching clinics with their held, where
they could see their own patients and, if necessary, we would
send an expert in that particular field out there teaching them
on their own patients in this own hospital.  Then they'd be apt
to talk about it at lunch and so forth.  I think that helped
increase the interest in what we were trying to do together. 
Now, did you get that feeling?

Ward:  Yes.  We went to the hospitals to do most of the training. 
No question about it.  Even the coronary care training for
nurses, intensive care training for nurses, and other personnel,
the electronics and the rest, were done in local hospitals.  Very
few people were brought into the medical center itself, into the
medical school.  In fact, the great bulk of the meetings that
were held on the weekends were held in hotels, and the personnel
from the medical school would come out to the hotel, usually an
airport hotel, and the physicians would meet on the weekend with
the training personnel and go through the court.  Classes in
dysymmetry, for example, were held in places like Mount Zion,
where we had a cancer center, and it was really part of the
university, but we'd bring the physicians into Mount Zion, but we
wouldn't necessarily bring them into the medical school up at
Parnasses [phonetic].  The same was true in Southern California. 
We brought them into the cancer center and the personnel came
over from the university.

Egeberg:  We started something, I believe, at Kern [phonetic]
County General, and we started some clinics in that, short of
their coming down to USC.

Ward:  Right.  We really decentralized the program.  See, that
was in keeping with the changes in the legislation, because it
did 180 about-face during its passage through Congress.  It
started out as a medical center-oriented program, and by the time
it got out of the Congress, it was an individual practitioner-
centered program with voluntary cooperative arrangements and
medical schools coming out to the practicing community and
disseminating the knowledge.  I suppose it was a political
decision to do that.  Otherwise, you couldn't have gotten the
votes.  [Laughter]

Egeberg:  No.  It seems to me in the back of my mind that we were
trying to go into Orange County, which was right next door, but
there was somebody there, or the whole group didn't want to admit
that maybe we at the medical school knew more than any of them,
and so the hospital there took over for a while.  Do you remember
anything about that?

Ward:  Well, that happened, I think, in quite a few places. 
Orange County came around pretty good, but you know there was
quite a division in their own local leadership.  

Egeberg:  Yes.  

Ward:  So we didn't try to take sides with the leadership.  We
just did what they wanted to do, essentially, and that's why we
went to places like Mount Zion and the big hospital in Orange
County.  We did go to the other hospital, that's right.  You
recall, too, that Orange County Medical School didn't have a
hospital in the very beginning.

Egeberg:  No, this must have been about the time that they got
started down there, yes.

Ward:  Three schools--La Jolla, Irvine, and Davis--got started
the last year of the Brown administration, because we put those
bills through.  Those were my bills.  

Egeberg:  That was La Jolla and Irvine and Davis.  

Ward:  Yes.  All those schools were in one bill.  

Egeberg:  At the beginning we had the others.

Ward:  Yes.

Egeberg:  Which was San Francisco and L.A. and USC.

Ward:  We took the old OD hospital in L.A.

Egeberg:  Yes.

Ward:  And made it into the Irvine Medical School.

Egeberg:  Yes, I remember that.

Ward:  That was quite a struggle.

Egeberg:  I had to graduate the first class as M.D.s there, and
they weren't students; they were all the osteopaths that were in
practice.  It sort of came under me because of that hospital when
I was medical director of the Department of Charities.  

Ward:  The program evolved along the educational lines, and along
the creation of new services to a degree, but we ought to put in
that when the Nixon administration came in, of course, they
wanted their own ball game.  They didn't want to carry on the
Johnson programs.  They wanted to do some of the things that they
thought they had been elected for.  They didn't think they had
been elected for the Johnson program.  RMP was a Johnson program.

Egeberg:  Isn't this always true?

Ward:  It's always true.  But always the new administration wants
their own programs, even if it follows through with the same
party, the Democratic or Republican Party.   They think their
agenda is very important, and rightfully so, because that's what
they were elected upon.  
     But when the Nixon administration came in, they were looking
for dollars.  The Vietnam War had become very expensive about
this time, and dollars were hard to come by compared to in the
Johnson administration.  They were trying to free up some dollars
and to put their own agenda into being.  The Congress, however,
supported the RMP program very strongly, and Congress wasn't
interested in making the changes that the Nixon administration
wanted to make in the program.  So there was naturally a kind of
political compromise.  
     The Nixon administration was the impetus for trying to
change it from an educational program almost solely to a much
stronger mix of the development of new services.  Now, both sides
supported the development of new manpower, but the Nixon
administration wanted the new services, wanted them very badly,
and if RMP couldn't provide the new services, change its
orientation a bit and provide the new services, then the Nixon
administration wanted a program that could.  
     So the 1970s saw the advent of the Nixon administration
priorities in the health care field.  I won't go into all those
priorities, but essentially they dealt with the development of
new services.  That's when we began to take on the development of
health services kinds of things and services in Watts, and we
developed a medical school in Watts, the Drew School, and all
that.  We funded the development of the Drew School.  
     So that's the involvement away from education, away from
technology, education about new technology, and the new services
came about in that way.  

Egeberg:  What do you think were the major accomplishments of
RMPs?

Ward:  The major accomplishment, in my way of thinking, anyway,
was to bring the medical community together and try to figure out
how the highest quality services could be rendered.  I think that
the records speak for themselves, and I don't have all those
figures at the tip of my tongue, but just consider the fact in
California, that when we began, there were only eleven coronary
care units.  

Egeberg:  Only eleven coronary care units?

Ward:  That's right.  There were only eleven coronary care units
in California when we began the program.  Some five years later,
there were 257.  Now, those are the only figures I remember just
offhand, but I know that we accelerated the growth of intensive
care units and coronary care units dramatically.  We trained a
fantastic number of nurses.  I don't have the figures at hand
anymore, but we taught people to understand monitoring, which I
think was one of the greatest accomplishments, because although
it doesn't sound even remotely feasible today, back then people
did not understand what monitoring was.

Egeberg:  They thought you stood by the bedside.

Ward:  The typical understanding of monitoring when we started
was that to monitor a patient, you had someone stand by the
bedside and watch the patient, taking vital signs almost
constantly, and see if he were alive or dead.  That was
monitoring in the old days.  We tried to tell them, no, you don't
monitor with the person; you monitor with electronic
surveillance.  This was hard for people to understand, very
difficult for even nurses to understand, for doctors to
understand, because they hadn't seen a monitoring machine, they
hadn't seen a screen above which the results of monitoring
appeared.  When we brought those monitoring machines into local
hospitals for instruction, nobody really thought they would work. 
They laughed at us.  They hadn't seen them operated in the eleven
units that we had going.  
     We ran into many problems, but it was wonderful because you
saw how fast this all developed.  Nurses became very bored
watching these damn screens, and they had to watch them almost
all day, because if they didn't watch them and the screen went
straight across all of a sudden, the patient was dead, and they'd
let the patient die without doing anything.  We finally learned
to put a bell on the machine so that the bell would ring when
there was a variation.  It was really a very simple process of
improving, but it was rapid.

Egeberg:  At first you had an EKG going and you took respiration
and pulse rate.  That was about all you took in the beginning,
wasn't it?

Ward:  Right.  We even taught EKG, how to read EKGs, because the
physicians out in rural areas, the boondocks, as we called them,
did not know how to read EKGs.  We had many classes training
physicians on how to read EKGs.  That doesn't even sound feasible
today, but that's what we did.  We were at a window of time in
which this knowledge just blossomed on the medical field, and we
were there to teach it.  Now, to be sure this knowledge would
have found its way out into the medical field somehow, but the
fact that we were there to teach it at the time that it came on
the scene made it blossom an awful lot faster.  The quality of
care improved dramatically in the smaller hospitals and out in
the clinics that were remote from the high tech areas.  Those
were the people that we dealt with, and I think that was the
greatest early accomplishment.  
     The different levels of manpower that were basically
created, the training in dysymmetry, training of technology, was
the second, and third was the minor things we dealt with,
including clinics.  Most of the clinics disappeared, though.

Egeberg:  I was glad to hear you say what you said at first. 
They asked me that same question and I said that the greatest
thing that came out of it was to have people representing
hospitals, organized medicine, specialistic societies, medical
schools, and what have you, working together and finding they
could solve problems working together and talking to each other.

Ward:  Absolutely.  That was one of the great, great attributes.

Egeberg:  If we could have kept that going.  We've sort of drawn
off a bit into poles.

Ward:  We're terribly drawn off into poles, Roger, and people
don't realize this.  I read an interesting thing in the news
review put out by the Institute of Medicine and the Academy of
Sciences, in which they said they're having trouble getting new
decisions at the various technology levels, where decisions are
made, out in time to local physicians and local delivery systems. 
They've taken to mimeographing findings and just mailing them to
everybody, because it takes now too long to approve it to go into
a medical journal, and it's three or four or five or six or seven
months later that it gets into the medical journal, and they're
deliberately trying to find a way to disseminate it earlier so
that the physician will be ready to use it once it's approved. 
This may work and it may not work, but, you know, in medicine
there is no other education that has supplanted one-on-one type
education.  That's what RMP was able to do.

Egeberg:  Yes.  

Ward:  That's the thing RMP did and did very well.

Egeberg:  Did the attitudes of the Congress or the Public Health
Service toward the RMP change when President Nixon succeeded
President Johnson?  If so, how?  You've sort of answered that
one, haven't you?

Ward:  Yes.  I don't think it's fair to separate out the Public
Health Service, because the Public Health Service works for the--

[Begin Tape 1, Side 2]

Ward:  As I said, I think it's unfair to place any onus upon the
Public Health Service.  The way the Congress changed was minor. 
It still strongly supported the original legislation that created
RMP, but at the same time they wanted new services created also. 
They had always been bothered by what they considered to be an
overlap between CHP and RMP, and so they wanted to look upon RMP
as the service-creating arm of CHP and of the education arm of
CHP, and they were always trying to put the program together. 
     When we say the Nixon administration, I think we ought to
point out that it wasn't necessarily HEW that felt this way; it
was OMB that felt this way.  OMB was looking for ways to
consolidate everything, and they were very willing to consolidate
CHP and RMP if they could consolidate them down to the one budget
of one or the other.  In other words, cut out the RMP fund or cut
out the CHP fund.  This is understandable, because that's OMB's
job.  So there wasn't any change that wouldn't happen ordinarily
with the change of administration and the looking for new funds
in a tight budget situation that was becoming more tight.  You
had to fight for your life.  You had to fight for your life if
you were part of any social program within the administration,
where they had programmed for cuts and realignment of resources.

Egeberg:  I learned that in Washington.  Also it's hard to get
somebody to start a program if they think it will come to its
fruition in the next administration and the next administration
will get the credit for it.

Ward:  Absolutely.  And you know, I think there's one thing we
ought to include in this, that when OMB got the Nixon
administration to cut the funding for RMP, we sued the Nixon
administration and made them live up to the law of dispersing the
federal funds that were appropriated within the year that they
were appropriated, and we wouldn't let them carry them over. 
When they found out they couldn't change the program--

Egeberg:  Aren't you going to say, "And we won"?  I had a feeling
you had a big part to do with that.

Ward:  In fact, I owe that a lot.  This is parenthetical, but as
you will recall, California was principally responsible for
pushing the anti-smoking warning on cigarette packs during the
previous years, twenty-five years ago.  But when I went back and
I worked with the lawyer on the suit against Nixon and we put
this thing together, we both smoked cigars like mad.  

Egeberg:  I remember you did!

Ward:  And the room would get so full of cigar smoke, we couldn't
see what we were writing in the way of preparing the suit.  Well,
unfortunately, the attorney got cancer of the throat during this
period, and I'm not sure it was from the cigar smoke, but I came
home one time from that meeting, after discovering that he had
gotten cancer.  I threw all my cigars away and I never smoked
again after that.

Egeberg:  Is that so?

Ward:  Yes.  It meant an awful lot to me to win the suit, but it
ended my cigar smoking, also.

Egeberg:  Yes.  That's interesting.  It takes often something as
strong as that to do it.  

Ward:  But it's tragic.

Egeberg:  Yes. 

Ward:  Very tragic.  

Egeberg:  What evidence is there to support or refute the charges
made by Dr. John Zatt [phonetic] at the Department of HEW in
House committee hearings on May 8, 1973, that the RMP were not
worth the $500 million that the program had cost, and that 40
percent of this money had been spent on administration of the
program?  Was all of the money that was appropriated by the
Congress actually allocated to the regions?  How was the figure
for administration determined?  In other words, did it include
any direct costs, which we mentioned earlier?

Ward:  Roger, that's the question that I said I had asked him to
send me what Dr. Zatt said.  But let me just say in that regard,
I appeared at that hearing, as I recall, and I testified for the
programs, if I've got the right hearing in mind.  After all,
twenty-five years have gone by, and I testified at one hell of a
lot of hearings.  
     Zatt was simply making the administration's point, at that
point in time, whatever it was, and I don't recall it exactly. 
That's what he was there for.

Egeberg:  Yes, I think he did that well.

Ward:  And he did bring up, as I recall--he always brought it
up--the indirect cost factor.  He would lump indirect costs with
administrative costs and say that the administrative costs,
therefore, were running 40 percent, 50 percent.  Well, as you
will recall, medical schools and universities received indirect
costs for programs that they participated in.  I won't go into
the whole history of the indirect cost except to say that it's
very important to understand that at that point in time.  We had
just come out of a big debate of a decade or more over federal
aid to education.  There were people that were diametrically
opposed to federal aid to education.  But one way that we could
get funding to universities and to medical schools, because a lot
of them were private, as well as public, was to engage in
indirect costs.  
     The whole indirect cost program was federal aid to higher
education, and it was a little bit unfair to suggest because we
were paying indirect costs to universities, that this was an RMP
overhead cost.  But they deliberately mixed them up because of
the value that that would have in making the program look bad. 
It was always my feeling that indirect costs were high, but that
when you considered the fact that those funds were supporting
higher education, I had no quarrel with it, because higher
education needed to be funded.  I felt it was better to fund it
that way than to make students pay tremendously high costs and
knock all the poor students out of the university school
opportunity.  
     So this was a very involved question.  It's true that we
paid a lot of indirect costs out of RMP funds to the
universities, but it's also true that we got a very valuable
support out of the universities and the medical schools' staff
that couldn't have been obtained in any way.  
     Just very briefly, let me say that we did not pay all of the
university professor's salary; we paid his transportation cost to
a meeting, we paid his hotel bill if he stayed overnight at one
of these clinics that we put on at the local hospital, but the
university was still supporting the professor and his salary and
other expenses relating to the medical school.  So it was pretty
much of a tradeoff, and it was a good tradeoff any way you look
at it.  

Egeberg:  You could always see the broad picture.  I always
admired you for that.

Ward:  Well, he would get up and make these statements about
overhead all the time.  It just drove me out of my mind!

Egeberg:  And just keep repeating it.

Ward:  Yes.  But he repeated it enough that it began to sink in. 
Now, you talk about direct cost.  Our direct costs were the
training costs, the education costs of putting this together, of
renting the room, of getting the material, of getting the
participants, and this kind of thing.  Our direct costs were not
patient care costs, which he was trying to mix into his testimony
from time to time.  Strangely enough, [Harold] Margulies and
others were under extreme pressure to make this point all the
time by OMB.  Not strangely enough; that's the way you play the
game.

Egeberg:  Yes.

Ward:  And you weren't really fooling Congress in this.  Congress
knew this.  But they were trying to make their points for the
press.  It was a PR operation, and I just don't think it's a
valuable concern because it's all fluff, anyway.  

Egeberg:  It's fluff and it's not the good part of the politics. 
Good politics got all the people who were concerned together. 
That was good politics.  But the bad politics is for someone to
try to hammer his point of view and lie while he's doing it.  

Ward:  Right.  Now, another point that was made, although it
isn't involved in the question, it was strictly a federal
program, not a federal-state program.  You see, CHP was a
federal-state program.  The states were putting up a small amount
of money for the CHP, as well as the federal government, but also
the local people were supposed to put up a little bit of money, a
little tiny bit of money for the CHP program.  I forget the
formula just now.  After all, it has been twenty-five years!

Egeberg:  You're remembering a lot and you're reminding me of a
lot.  

Ward:  But they tried to draw in that comparison all the time by
saying, "Look.  The local people aren't putting up any money." 
Well, the local people were putting up money.  In fact, CMA put
up quite a bit of the cost of the health care delivery for the
rural centers.  They put up $10,000 at a crack and $50,000 at a
crack and all that kind of stuff.  The local hospitals were
putting up money for the equipment to practice on and this kind
of stuff.  There was a lot of input locally for RMP that wasn't
identified, you see.  It wasn't identified.

Egeberg:  For RMP.  This is what you're talking about.

Ward:  Right.  That local money for patient care in the rural
programs was put up by CMA because we were prohibited from
providing direct patient care, so they put up those costs.  We
put up the management costs.  We were audited constantly.  In
fact, we used to joke about it.  We used to say that we were the
primary training ground for new federal auditors.  [Laughter] 
And we were!  So we were very careful not to use any of our funds
for other than education and training and the rest.  But at the
same time, the program was structured in such a way that it
didn't identify local money being put up because there wasn't any
federal requirement that funds be matched.  Therefore, you don't
identify when you don't match funds.  Those were phoney
arguments.

Egeberg:  Yes, they were phoney.  I read somewhere else--maybe it
was in your article in the Western Medicine about how ambiguous
that was and that how, after all, the RMP had the money to go
through with the program.  The CHP only had money to plan, and
therefore you naturally took the ball away from CHP in many
areas.  Didn't you bring that out in your article?

Ward:  Yes.  That was a PR program, but we had very good
relations with CHP in California, at least at the state level. 
We had problems at the local level, but we didn't have problems
the Congress was concerned about that arose in certain other
areas, where there was real dog-eat-dog [unclear].

Egeberg:  Yes.  And that was the good thing that you were
mentioning and that I agreed strongly with, that here you had a
chance for people to start talking together, and really once you
start talking together, you can usually, with good leadership,
get some solutions.  They may not be this solution, but they'd be
a good solid solution.

Ward:  Sure.  With reasonable people you get solutions,
especially if there is something that they think will benefit
their situation in their community.  If we just had argued, "To
hell with it," but if some benefit is going to derive from all
this, then they'll put in their time.  And that's what they did.

Egeberg:  What changes in the direction of the RMPs were imposed
by the Nixon administration and the Congress?  

Ward:  Actually, the changes went to the development of new
services, as we've covered.  I forget what those priorities were
at this point.  I'm sure that they could be found somewhere.  But
the Nixon administration came up with a whole set of health
priorities that it wanted to implement during its term in office,
and they tried to relate those priorities to RMP, and it didn't
always fit, because the expansion of knowledge was not
necessarily high on their priority list.  

Egeberg:  That was well put.

Ward:  They wanted economy and new resources, and they kind of
had blinders on in regard to what the actual situation was.  They
had a feeling--and this came more from OMB, from Fred Mallick,
and from people down deep in the president's office--that they
could restructure the medical care system by edict.  They really
felt they could.  That was a terrific naivete on their part,
because you can't restructure something that involves people to
the degree that the [unclear] care system does, especially highly
educated people, by edict, because they're so damn stubborn, they
just won't follow the edicts.  

Egeberg:  What programs were proposed by the Nixon administration
to take over the function of the RMPs?  Does the evidence suggest
that they actually did so?

Ward:  When I went over that question originally, I tried to
think of any program that they suggested the takeover of RMP, and
actually I couldn't recall any.

Egeberg:  Somebody said CHP.

Ward:  Well, that's what I was going to say.  They wanted to join
RMP with CHP, put the two programs together, but they didn't
necessarily say that CHP was going to take over the functions of
RMP.  For example, CHP would either take over the RMP
appropriation and give up its own, or keep its own and do away
with the RMP appropriation.  CHP would continue with its planning
committee, but it wouldn't have an RMP type committee where it
brought together the kind of people that we brought together.  It
wouldn't do the educational job that we were going to do.  It
wouldn't do many of the things that we were going to do.  They
changed that a little bit later on to say that when they joined
CHP with RMP, they meant that CHP would do what it's going to do,
but it would also supervise the creation of new services and the
training of new levels of manpower, and they would get away from
cooperative arrangements, regionalizing, and all that kind of
thing.  
     I must say that I always had a feeling that the people that
were dictating health policy from OMB in the president's office
never had any understanding at all of what the two programs did. 
They only wanted to put them together and hope for the best.  It
was just a way of freeing up money for priorities that they had. 
Again, the Vietnam War was costing more and more money and the
debt was growing faster than in the Johnson administration.  So
there was a big push to consolidate programs and appropriations,
but it's more important to say we were consolidating the
appropriations and cutting them in half.  It was an OMB-inspired
kind of a thing.  It wasn't a programmatic kind of thing at all. 


Egeberg:  No, it was the bottom line, as they say now in
Washington.

Ward:  Absolutely.  They were very bottom line-conscious.  

Egeberg:  What did they have?  Laundry lists?  They had a lot of
vocabulary that they invented, and I think "bottom line" was one
of them.

Ward:  Bottom line.

Egeberg:  What programs were proposed by the Nixon administration
to take over the functions of the RMPs?  Does the evidence
suggest that they actually did so?  I think you've just answered
that one.

Ward:  I didn't see any evidence.  They may have generated some
language that I don't recall right at the moment, but that
language never went anyplace.  I just don't recall it if they
did.  

Egeberg:  Did the fact that the RMP was a decentralized, fully
funded federal program influence the Nixon administration's
attitude towards it?

Ward:  You have to say that it did to a degree, because, if
you'll recall, the Nixon administration made quite a bit during
the campaign of decentralizing the huge federal government.

Egeberg:  That's one thing I admired Nixon for.  

Ward:  They looked into RMP, though, as a highly centralized
program, and that's what I mean when I say they didn't understand
what they were doing, because they looked at RMP as a fully
federally funded, federally run program.  They didn't look at the
decentralization of the program down to the local level and down
to the region.  They looked at CHP, on the other hand, as a semi-
decentralized program, because the state put up part of the money
and the local government, the counties, put up a minuscule amount
of money.  That defined decentralization with the Nixon
administration.  If the federal government put up a little bit,
the states put up a lot more, and county government put up even
more.  Then that was a decentralized program.  As such, RMP
didn't fall into that particular category.  To put it another
way, decentralization revolved around funding, not around the
ideologically motivated movements within the program and where
they derived.

Egeberg:  In respect to this program.

Ward:  Right.  If ideology derived from Washington and it was
dictated on the local level, naturally that's a federally run
program.  But if the funding came from Washington and the ideas
that were funded were ideas that came from the local community,
you have to define that as a decentralized program.  But they
would never define it as a decentralized program.  

Egeberg:  That's strange.  I gave them credit for Soviet Union,
China, and decentralization, or his attitude towards
decentralization.  I thought sometime he'd come up looking pretty
good in those fields.  It all depends on how you look at
decentralization.  

Ward:  Depends on how you look at it and whether you understand
it or not, and whether you really want to understand it or not. 
These things kind of get set in concrete.  Once you come out with
your priorities and once you locate sources of expenditure that
you can eliminate, you became kind of cemented in.  Even though
you might understand them differently down the road, you can't
get a position.  Pretty hard to change.  This is the position
they got themselves into early, and they never really talked, or
maybe didn't have the time to talk, to people about these things
and to gain an understanding.  They had to move kind of fast and
they just weren't very comfortable in the health field.  They
didn't understand it.  

Egeberg:  I remember Nixon would warm up when he felt he was
going to have a health plan and really would maybe talk for
three-quarters of an hour and sometimes have a good grasp of it
and sometimes perhaps not.  

Ward:  In that field, Nixon tried to do a good job in regard to
health insurance.  He had Jack Vanaman [phonetic] sort of running
that.  Jack Vanaman really understood what was needed in the
health field, how the health field worked.  Jack Vanaman was a
very easy guy to talk to, a very easy guy to work with insofar as
the health field was concerned, because he understood it.  And in
particular he understood California and its health field, because
he had been instrumental with me in the enactment of Medical and
Title IXX implementation in California.  Vanaman was one of the
strongest supporters of health care and one of the most
understanding men in that whole administration.

Egeberg:  That's what I felt.

Ward:  But Vanaman never had the opportunity to really tell them
what it was all about.  

Egeberg:  It's too bad he had that heart stoppage long enough so
that his memory really had to be rebuilt.  It could be rebuilt. 
You'd go to him, he'd press a button, and you'd talk about
something and he'd remember it from then on.  But he couldn't
remember from before.  

Ward:  Yes.

Egeberg:  I think he was the most popular person with any
authority in the Nixon administration, because he could deal with
everything.  
     In your view, why did the Nixon administration terminate
RMPs?  What factors motivated the deputy assistant secretary for
legislation, health, of DHEW, Dr. John Zatt, and the director of
the RMP service, Dr. Harold Margulies, to support termination of
RMPs?  

Ward:  I think that the Nixon administration took the hard line
on the elimination of the program because they felt that it was
not meeting the objectives that they set forth in 1970 or 1971,
and again I figure with more misunderstanding about what was
going on than anything where they were violently opposed. 
Margulies and Zatt, in my opinion, supported the termination of
the program simply because they were ordered to.  

Egeberg:  Say that again.  Because they were--

Ward:  Ordered to.  

Egeberg:  Yes.

Ward:  Right.  It was no secret.  Every administration operates a
little bit differently, but it's no secret that OMB ran the Nixon
administration in the early days.  OMB was a strong, strong
factor, and the secretaries did what they were told, largely. 
That was the story out and about.  They did what OMB told them to
do.  OMB had the president's ear, and that's the way he wanted
it.  [Eliot] Richardson had a hard time talking with the
president on many issues, and some of his secretaries before and
after Richardson had a hard time talking.  I don't think the pro-
health people were ever listened to, Roger.

Egeberg:  I don't think they were listened to to the degree that
it was extended for about a year and a half and then you got it
extended another year by the suit that you pursued.

Ward:  Right.  

Egeberg:  I'm delighted to hear you say what I felt deeply was a
very important thing which nobody from Washington was really
going to see, what they accomplished.  They accomplished showing
the world that if you get a bunch of people with a lot of
different ideas and antagonistic around the same table, and with
leadership which lets conversation go and discussion go, the
chances are you can come to agreements and you don't have to say
who won this battle and who won that battle.  Don't you think--
well, you did mention it.  You felt that was one of the--

Ward:  I think the point that never gets covered well enough is
involvement.  You have to know the politics of organizations in
order to understand what involvement means.  The reason that I
believe that CMA, CHA, the Heart Association, the Cancer
Society--

Egeberg:  Medical schools.

Ward:  Medical schools and the Health Department, the reason they
support the organization is because their top leaders were
involved in the functioning of the organization.  They were on
the board, they listened to the debate, they went back to their
own organization, and they were able to tell firsthand what was
going on out there, and they didn't have a fear of what was going
on out there because they knew what was going on.  Now, if you
isolate yourself from the leadership of those organizations, they
hear all sorts of rumors, they feed upon the rumors, they love
the rumors.  When they go back to their organization, they get to
discussing the rumors, and the rumors become bigger and bigger
and bigger and bigger.  Therefore, you become evil.  
     I knew that, I think, when I was secretary of health and
welfare, that if I kept organized medicine involved and medical
schools involved, the voluntary associations involved in any
piece of health legislation dealing with the health department, I
had a heck of a lot better chance of getting it through than if I
left them out of the equation.  Even though they didn't always
agree with me when the final version came along, nevertheless
they felt they had been involved and they didn't feel uptight
about the situation or as uptight about the situation as if I
just kicked them out and then tried to get through by myself. 
Also, in a democracy, you've got to have 51 percent of the vote,
and if you don't have it, you're in trouble.  This is one of the
ways--not the only way--but one of the ways of getting the
support to get 51 percent of the vote.  If we say we believe in
democracy, then we ought to follow democratic precepts.  But we
don't always do that.  That's what RMP did at the local level. 
It brought in the people that were the players that brought in
the public, brought in all of the professional players, brought
in voluntary people that were interested beyond the public.  Put
them all together and let them make a decision about how we
attacked the problem.  That was the heart of RMP.  

Egeberg:  That was also the way Governor Pat Brown worked, wasn't
it?

Ward:  Yes.  

Egeberg:  He put me on the committee once and I became head of
it, the Committee for Medical Aid and Health to California. On
that committee he had people that I would say had beyond just
socialistic ideals, I think way over to the left, and he had the
most conservative son of a bitch I'd ever met on the right, and
the whole gamut between them, each representing something.  Out
of that group we brought a report.

Ward:  Out of that report came the Egeberg report, and that
report started much of the improvements that we made in
California during that time.

Egeberg:  I think we had 57 or maybe 100 different
recommendations, and he saw to it that every one of them were
taken care of.  You probably did!

Ward:  The Egeberg report was bible.  It really was.

Egeberg:  Was it really?

Ward:  Yes.  You know, Brown believed in good health care more
than any other guy that I've seen in that governor's office.  He
was all for it.  He wanted a health insurance program badly.  We
enacted the Medicaid program in California before it was even
passed at the federal level, and we put more time and effort into
the passage of 89-97, the old Medicare/Medicaid bill, than any
other state.  We got the counties' support nationally.  The
counties were running into high cost for care of the aged even
then.  Your hospital down in Los Angeles had 105, 110 percent
occupancy all the time.  You had beds out in the hall, and you
were having a heck of a time supporting the costs of the aged
that were growing and growing and growing and growing like mad. 
The Egeberg report meant that you had to do something about it. 
That was the good health movement in the state of California. 
Not a good thing has been done in health care since the Egeberg
report.

Egeberg:  My God!

Ward:  Really, I mean that.  It meant the passage of all that
child health legislation, it meant the passage of Medicaid, it
meant the improvement of the long-term care, it meant the
improvement of the quality.  It just hit right and it set it all
off, and boy, do we need it again, because health care in
California is in one hell of a mess.  It's in bad shape.  I know
we have to have a crisis, but it's rapidly approaching a crisis. 
We're going to have a crisis and then maybe something will be
done, but there's just an awful lot of people who don't have
health care and health care coverage.  Medicaid has gone downhill
something terrible.  Medicare is having its problems.  That's
over 50 percent of the care right there.

Egeberg:  Yes, those two.  

Ward:  And health insurance is having a hell of a time making up
[unclear].  Cost shifting is going on.  Private sector just
hasn't handled it.

Egeberg:  And the board of supervisors is not what it was.  They
weren't stars, but, by God, they had some good feelings in that
old board of supervisors.  

Ward:  Right.  But they've been hit by Prop 13.  They were hit
hard.  Prop 13 has done a lot of damage to health care and it's
done a lot of damage to the state of California.  

Egeberg:  How long do you think it will last?

Ward:  Until the Supreme Court recognizes the extreme
differential in taxation of equally valued properly.  They're
going to tear it down piece by piece before it can get back on a
reasonable level, but you've got property today in California
where especially industrial property that has been held long
before Prop 13, it's only gone up incrementally as allowed under
Prop 13, whereas you have your residential property that has been
sold time and again, time and again.  Each time the residence
have been sold, it's been evaluated at its new value and taxed at
its new value.  So residential property has gone up tremendously. 
A lot of your industrial property that's been held over the ages
still is at that low level of pre-Prop 13 value.  The courts are
eventually going to have to recognize that that's inequality in
taxation, which is prohibited by the Constitution, and you're
going to have to say, well, you've got to bring up the value of
the industrial property to meet the property rise in the
residential property, because that's inequality.  

Egeberg:  I never saw it that way.  This is interesting.

Ward:  Commercial property is just in between.  Commercial
property does sell a little bit faster than industrial property,
but not much faster.  So you've got an inequality there.  The tax
base in the county has been hurt very, very bad by the low level
of the commercial and the industrial property.  I had a big
house.  When my wife died, I sold that house, but I was paying
very low taxes because I'd owned it for a number of years.  It
went up three times when I sold it to the new owner.  He paid
three times as many taxes as I paid.  Not only that.  I had a
5,000-square-foot home.  The guy behind me had a 1,200-square-
foot home.  During the time that we lived together (because he
bought his late), he was paying as much taxes as I was.

Egeberg:  Because he bought later.

Ward:  Because he bought later.  The 1980 cost of a home, you
know, is quite different from 1960s.  I built it in the sixties. 
So that kind of thing can't go on forever.

Egeberg:  Is there some effort going toward the Supreme Court to
do something about it?

Ward:  Oh, yes.  Macy's took it to the Supreme Court because they
bought a new building right next to Penny's, and Penny's had
owned theirs for a long time and they were really of equal value,
but Penny's taxes . . .

[End of recording]