iiiiiiii@itil I P.AAT OTTE: OVERVIF'TJ A. EXECUTIVE SUMt4ARY OF THE FORWARD PLAN FOR HEALTH FOR FY'1976-1)80 In much abbreviated form the Forward Plan for Health, FY 19.76-19'80, is highlighted in the next 26 pages. The first section indicates the uajor dimensions of the national condition of and trends in the health industry over this time peri od. It also reiterates the ,several roles' for the Federal Government operating in that health context. The second and major section of the summary describes the five themes which have guided the.development of the forward plan: 1. Prevention II. Preparing for National Health Insurance A. Planning and Regulation (including cost containment) B.. Primary Care X 1. Structural Reform (modifying Training and Service Delivery Institutions) X 2. Scarcity Area Focus III. Quality Assurance IV. Tracking Health Status and the Health Industry V. Knowledge Development The discussions of the five themes will highlight the major initiatives being proposed in the Forward Plan. Since the pursuit of many of these pation of all the major initiatives requires the commitment and partici agencies and regional health offices, the Assistant Secretary for Health is also focusing on the development of the necessary innovative inter- agency management techniques. An overview of this effort is also pre- sented in this summary. Thirdly, the at-nry will display all the DHEW health programs by "areas of Federal responsibility." These areas are grouped under the three major headings of (1) protection/prevention, (2) improving health care, and 4 (3) section pi;iii6iiii" a-t @t he' @r' ulacro- knowl This 1 the Department's health program, highlighting the proposed scopic ieve chan es in those programs for FY 1976. 9 Finall@-, there is described the PHS'planning process which-led to the plan and, in the form of a summary financial table, the budgetary implications of the proposed program changes. SECTION ONE: THE HEALTH INDUSTRY AND THE FEDERAL ',OVERNME',IT The major dimensions of the healtl industry can be suggested b,, a few sets of statistics on: health status, health resources, healti service utilization, and costs-expenditures-financing. Health Status: Descriptions of the extent of illness (morbidi:y), dis- ability, and death (mortality) due to "disease" provide a quantitative basis for assessing health status. It should be remembered, however, that these data, while instructive, are both non-qualitative and static. Currently, valid,mea'sures of qualitative status are not available, and reliable trend data, using even these quantitative indicators, are also in vt:ry.short supply. '.@ftli all these caveats, we can note that in 1972 there were ab@lut 450 million episodes of illness or injury. Over half of these episodes were a consequence of respiratory conditions, one-thii:d of which we-e influ- enza or pneumonia; about 47 million episodes were caused by in.'ective or parasitic diseases of which 2.5 million-were venereal in origin. About 68 million episodes were injuries, of which 5 million were caused by motor vehicle accidents. -As a consequence of chronic conditions during 1972, 13 percent-. of the Population experienced limitation of activity, while 3 percent suffered some limitation of mobility. Illness and injury iRow le.d to an annual total of over 4 billion disability days, of which 3@billio i c t ,ppn institutional sett,,t gg;@ Almost one-fifth of the population suffers one or more disability days annually, -qltlxt,)tjgh less than 3 percent of the population (those with long-term dis- abilities) account for 43 percent of the total days of disability. Over the last several decades the total death rate has remained fairly constant at about 1,000 per 100,000 population. li@iv ag.-var-ioqg,,,@@g!Rt@ts of the population. In 1971 the ii and race, were death rates, adjusted by the age en 9 r q 703 per 100,000 total, 917 for male versus 526 for females, and 669 for whit u , A,,.Q.Q 3f!qr,@otlo@§j, Furthermore, while the infant mor- tality rate continued to decline, reaching 19.1 per 100,000 live births, it was 17.1 for whites versus 28.5 for nonwhites and was about 50 percent higher for those with incomes ess than $5,000 than those with greater than $5,000t Health Care Resources: Some data on both facilities and manpower will outline the gross dimensions of the current scene. For example, the total number of inpatient health facilities now number over 35,000i containing over 3 million beds and employing almost 4 million persons. There are about 7,000 hospitals and 2.7 million hospital personnel, and over 22,000 nursing care homes employing 600,000 personnel. Over the last decade the number of acute beds increased by about 210,000 to a cut-rent.total of about 850,000, while the number of unoccupied beds his The distribution of I)eLis risen from 178,000 to 228,000 (a rise of 28%). g care homes varies significantly by region of for hospitals and nursin tlit, country. As (ii 1971,1the total l.ealth manpower pool %;as almost 4 1/2 million. increase of about 26 percent Plivsicians numbered 345,000,.representing an du'ring the last decade, and pro'ected t,, increase by inother one-third by 1980. Of the 287,000 physicians involved w.@th lirect care of patients, @ibout one-third were involved with primary art. The geographical dis- tribution of physicians varied greatly, with the population to phkysician- ratio decreasing-as the area-wide population increased (from 2,4,0-.:l to 521:1). The patient contact of physicians also varied geographically, with the number of patient visi,;s per physician per week decreasing ar. tht ;irea-wide population increased (from 233 to 124). The number of allied health practitioners involved with patient care numbered almost 3'million in 1971, while the number of other health persoanel not involved 'in patient care numbered about 1 milli,in. utiliz rvices: During 1970, nine percent of the.population accotm 30 million inpatient hospital admissions (resulting in 235 million hospital days). The n pqr n ine "@ead.,@y@.,, ly over the enti population. A@t ICt the percent of persons admitted to hospitals was the game for both sexes, as a function of "person years" of life, females were admitted about 50 percent more frequently (16 per Hundred person years versus 11). A traditi(.na I pattern of utilization by age was demonstrated during 1970: that .S, relatively low rates for children, relatively high rates in the 18-34 year range (including preg- n;inty admissions), i drop-off in'utilizati(a in the middle years of life, and the highest rates among the older age 6roups. On the other hand, the traditionall- f at distribution of use by differe t inCL-me,-&LqMR.51-- his ch d'sign,.fi,--antly over the last decade; by 1970, the lower income groups had admission rates 6igiiific '!El hi 'er than the higher income groups. Aconsistent relationship between admissions and place of residence was.also demonstrated--the highest rates for the rural non-farm population and the lowest rates for the large urban-area population.., It is signi- ficant to note that while the adiis'i':r@ri'r@t@fTr @s and inner- city residents -ere lower,, @@av for su pA tente@was 1950 has been a steady increase in hospital a ons (froi,: 110 per 1,000 persons to 149 in 1972). In the same period, an increase in hospital days has occurred from 900 days per 1,000 population in 1950, to almost 1,200 per 1,000 in 1970-72; a decreasing average length of stay accounts for the recent levelling- off of hospital days at the 1200 level. During 1971, the number of idmissions to nursing care homes exceeded (,ine million, representing a sizable rate of increase over the last decade. 4 I)tiring 1970 over 14 million surgical procedures were performed, iepre- sentiiig an aggregate average of six procedures per 100 person.y@ars. This represents a slight increase over the last deca4e (fro m five per 100 person years). During the.1960's there was a shift in the number of surgical procedures by income, from a-direct to an inverse relationship to income (parallelling the trend in hospital admissions). The number of surgical procedures for f@@4;4ales was slightly higher, and the number for the elderly slightly hiF'@,-er. There were, however, no urban/rural differences documented. Outpatient hospital visits in 1972 totalled about 200 million, rdpresent- inc, an increase ot over 40 percent from 1970 and accelerating the trend evident over the last two de@..,,--@,s. The 1955 figure was 329 visits per 1,000 population; the 1972 fl--,-ce was 809 visits per 1,000 population. Durin- 1970 there were over 800 million physician encounters... Maior' C, differences in utilization wd-rird-d-c7tiiWiif,@cl by r @, with,,,,, 9L,,,RP-rr- t@ white population seeing a physic--an, with an average of -4.1 v ...... Of' wili e nly 58 Dercent with an iverage of 3. v sits.. Although the gap between low and high income persons seeing physicians narrowed o,ier the dee3de (65 percent for low Income versus 71 percent for high inzome), once seeing a doctor the number of visits was higher for low income persons (4.9 visits versus 3.6 visits). On the other hand, traditional patterns of utilization by age and sex were maintained, with the percentage of v ersons seeing a phys-clan being about equal for all ages, except for the elderly; use by'females was both more common and r-iore frequent (71 percent v(rsus 65 percent for miles and 4.5 visits versus 3.6 visits). The percentage of persons .seeing a physician was highest among those in urban areas other than the central city, and lowest among those from rural farm areas. Significantly, however, over the decade there was a decrease in the average number cf visits per person by all measures, except for an increase for children and those aged 55 to 64. About 70 percent.of physician encounters were In physician offices, although this rate was about 10 percent less for nonwhite persons; about 10 percent of encounters were at hospital clinics or emergency rooms, although the rate was twice as high among nonwhites and 50 percent higher for those with incomes below $3,000; about 12 percent of ficounter,,- were over the telephone, although the rate was half for nonwhit . . and those with incomes below $3,009. About 60 percent of all visits -were handled by general practitioners, 12 percent by internists, 10 percent by pediatricians, 6 percent by obstetric-ans/gynecologists, tid 3 percent by surgeons ' About 75 percent of the encounters were for diagnosis and treatment, 10 percent for general checkups, 4 percent for prenatal care, and 4 percent for immunizations. 5 Costs. Expenditures, Financing: ToLll expenditures resulting from illness n@d injt.try '--n 1973 amounted to over $200 billion; $8(i billion represents the direct c,)sts for personal health care services (of the $94 billion the total health expenditures); the balance stems from the indirett costs of work loss' etc. It has been estimated,that the direct costs figure for kY 1976 will be $115 billion. The rist- in personal c@re expenditures has been dramatic over the last two decades, from $10.4 bi'lion in 1950 to $22.7 billion in 1960 to $r)9.1 billion in 1970. Aver.-.ge per capita expenditures increased from $172 in 1966 to $285 in 1970 tc, $375 in 1973. llospIital expenditures n 11)73 accounted for $36.2 billion of t'ie total, and physician.expenditi.-es $18.0 billion. These expenditures also repre- sented significant incz!ases over the last two decades; hcspitil expendi- titres increased from $'-..9.t-illion in 1950 to $9.1 billion in 1)60 to $27.5 blitio-i in 1970, while -hy ician expenditures increased from $1.7 billion to $5 7 billion to $14. b Ilion, respectively. Ttic estimated average family expenditure in 1970 was $750, although almost half the families spent $300 or less. These averages varied depending on less than $5,000 spending an average of $550 and incom(, with families of families with greater than $10,000 spending an average of $850. Signifi- cant ,ariations were also documented for out-of-pocket costs; for example, 27.7 percent of families with incomes less than $3,000 and 3.3 percent of families with incomes greater than $15,000 had no out-of-pocket cr,.sts, aiti-cugh those with incomes less than $5,000 spent an average of 5209 out- O.'-p-icket versus $478 for those with greater than $10,000. Coincident to the rise in expenditures since 1950 has been increasing costs and charges. .For example, hospital costs per admii,3ion have risen from $!27 in 1950 to $245 in 1960 to $669 in 1970 and to $830 in 1972; similarly,. semi-private room charges have risen from $30 in 1950 to $57 in 1960 to $145 in 1970 and $174 in 1972. Analysis of these increases reveal that increases in prices accounted for almost one-half of the overall increases and that population increases accounted for another one-fifth, leaving only about one-third of the increases as a consequence of increased utilization, either of existing services or the addition of new services. Significantly, this rise in. prices was greater than the CPI In general. Similar ratios accounting for expenditure increases have been demonstrated for physician services. The highest rate of increases in prices was demonstrated for the years 1967-,'l '(during the period following the introduction of Meetcare and Medicaid, and prior to the impleinent@ation of the economic stabilization program). There is a problem, however, in analyzing these data, since of rice Index where medical care" remains the only item in the Consumer P a dollar's increase in price shows as a dollarts increase in cost, as a result of the great difficulty of accounting for "product improvements" in medical care. 6 Al@:o coincident to the rise in expenditures has been a redistribution of the sources of financing. While the percentage of government funds for personal care services remained fairly conr@tant at about 20 percent until the implementation of Medicare and Medicaid it has increased since then to 38 percent (1973). The percentage of finan(ing by private insurance grew steadily from 9 percent -n 1950 to 25 percent by the time of Medi- care/Medicaid, but has since remained fairly constant. Out-of-pocket Health expenditures represented 68 percent of the,total lti 1950 and about 50 ercent of the total just prior to Medicar6/Medlzaid; only about one-third of health expenditures are currently paid "out -)f pocke ." The most dramatic change has been for hospitalization, with third par,ies now covering over 90 percent of total expenditures for hospitalization. Public sources now pay about one-third of total expenditures for persons under age 65-, and two-thirds for persons over 65. There remain two major areas of inadequacies vith third-party (government and private insurance) financing. The first is incomplete and non- unifoiv coverage: one out of ten persons has no covers e an most others have inadequate coverage, while significant variations in coverage ex st for persons of different income levels. The second area is the coverage itself, especially the bias towards hospitalization and high (- st care and the lack of incentives to contain costs. In sumi we have serious problems in health status, especially for some-,. ii i in the @bution and productive ty Po ulation g 0 Ps, ry t th care resources, extensive, but widely v u't zation of I-ealth services-all tied to an enormous and rapidly escalating national investment.in the health industry. The Roles of the Federal Government The Federal Goverrment's involvement with the health industry has several traditions. The longest are the traditions of providing direct care to Federal beneficiaries and providing some major public health functions, primarily,but not exclusivelydisease control and, subsequently, protec- tion from hazardous products. Next in longevity are the roles of con- ducting and supporting (through grants) research on biomedical and behavioral problems. These traditions are now so well established, and the need for their continuation so clear, thatas national public policy, they are not questioned. There Is nearly a 30-year history of Federal financing of the costs of constructing health care facilities, primarily hospitals. Much more recently the Federal Government has become heavily involved in the partial financing of health care for major segments of the population, in the partial financing of health manpower development, and in the partial, sometimes total, financing of innovative health planning and service delivery agencies, such as community mental health centers, neighborhood health centers, comprehensive health planning agencies, etc. The 7 sly variedo challenging, experience of the last decade has been enormou and often disappointing. The Federal resources have been marshalled in response to widely acknowledged health-care problems which did not seem. to yield to the normal forces of the marketplace. Federal intervention In those instances has mostly responded well enough to the immediate pr(,blem, but often at high cost--such as exacerbating a condition of rapidly rising prices for health care, or raising the expectations of v.lrt of disadvantag real avai'l'ib"Iii' resources. If nothing else, these experi- encei significantly heightened national consciousness of the nature of the health industry, with all its strengths and weaknesses. Fmerging from that decade of Oxperience is a growing consensus, at least .It the Federal level, that the major health industry@,pfoblems--assuring financial access to high quality care, and better rationalizing the (leployr-tent of resources while containing their tosts--will not yield to less than a well-planned, concerted set of interventions by the @ederal (;overnment--working in full cooperation with the major components of the total industry--the prov ders, product manufacturers, consumers, third party payors, training institutions, and State.and local govern- s which sets the context for planning ments. It is that growing ct)nsensu the DHEW health programs thr(iugh the remainder of the 1970s. That growing consensus on the need for concerted Federal health efforts also high- lights the importance of inter-relating the '.1 planning process for health with th(t forward planning processes of the two IIEW agencies which'finance most Fecierally-supported health-services, SSA and SRS. SECTION TWO: HEALTH PLANNING THEMES. FY 1976-1980 This segment of the Forward Plan is developed with each theme first defined and described in terms of the broa ve which the Assistant Secretary for Health wants to emphasize over this planning period. S d, the difficulties of achieving those goals are dis- cussed--o which flows a strategic approach to overcoming them. Finally, each theme discussion includes the highlights of the major initiatives which we are Proposing to undertake. emphasizing those ini- tiatives which call for resources in fiscal year 1976. In the following summary of the five mAjor themes, only the objectives and the major ini- tiatives will be discussed in any length. 1. PREVENTION Preventing illness, injury, and premature death must be a major component of this Nationes health strategy. Prevention not only alleviates human suffering, it also holds the key to the lock on our present and fore- seeable health care problems, including their costs. The importance of preventive activities Is nearly equaled, however, by our ignorance of effective ways to accomplish prevention . Therefore, a fundamental co@ a..,f l@,, posient of 6va uiti@on, and the generation of new knowledge. 8 in a f ew llei-itaps because of our ignorance, tempered by knowledge areas, it is very diff;cult to define the boundaries of the prevention theme. It has often been asserted,.for example, that changes in the socio-- economic and cultural environment, affecting everything from diet and housLng to life style, have a far greater impact on health status than -ill the prevent ve and acute health care services combined. 'ertainly one facet of our emphasis on prevention will irclude growing Ittention by the Assistant Secretary for Health to those "controllable" envl mental factors which appear to have such properties. For puyoosee tfiis document, however, we will be concentrating on those re,---arct service activities within the he P3 s re The problems in the health care industry, 4n addition to inadequate knowledge, which tend to retard the progress of prevention include a set of attitudes which are primarily oriented toward the treatment of acute and chronic illness, the directing of the vast majority of tte industry's resources toward acute and chronic care, nd the conseqlen difficulty of effecting change. Both within the industry and within the consumer, there.@eed for change of attitude and ciange of behavior @iokigh.t@_an awa simply ttlg control Suc udinal and behavioral changes present an enormous challenge. The major elements of our preventive strategy are ssure.-@- tration of all federally supported,,h 4 programs .,on pre services. hea t milr7f'6iCAnce, ano nealth education. Prominent among e ef- .,@ I @t @, and all the programs thes @" forts."g @4ihi"'tHIP proposa'T, a, HMO of AJ)AMRA. The community mental health centers, for examp e, requ re a set of services ("consultation and education services") which reach out into the surrounding community to strengthen the abilities of many institutional agents, e.g.* school teachers, policemen, lawyers, physi- cians, etc., to deal with early-stage emotional problems and thus head off acute illness. y a o@dqyitlo The second segment of the strateg is to focu ,pUg_.ket-ter research and evaluation metho@r@ii-@@ne-ed6@-'O" a@rio-iii-'t--r'-e-'----t'ive ac@iVit-:res-.--"Pariicu arly necessary are -Methods 0 lif g healt som mii v@ed @e u4i@, h education activities, e.g., the anti-smokiog campaign, the responsible drinking campaign, etc. One crucial component to this research approach will be the support of the ehavioral sciences as they focus on underst anding mqtivation and atti t nal an4 behavioral change. udinal and_- The particular initiatives proposed in the body of the Plan intlude: (a) Strengthening States' capacities in laboratory diagnostic technology, including technology nec-@ssary to deiedt periconcep ve ti morbidity and mortality In the diseases and disorders which lead to of live-born infants affected by such problems newborn. The total number r million- From th3t number, over each yIear is approximately one-quarte 100,000 chilcren each year are added to the six m4llion mentally retarded persons in this country. . e benefits of early d;tection and prevention of such problems are enormous. At the present time, most States do not cities for supporting, for example, amniocentesis. have the laboratory capa which offer great hope for the prevention and other complex technologies of disease and lifelong disability. (b) Initiating a national program of supporting the fluoridation of all community sources of drinking water. For a relatively modest invest- ment, a fluoridation program could have enormous benefits both in health and In the cost of care. Most of the NIII proposals now before the Congress would include dental care through childhood. It has been estimated that a, least $2.6,billionIwould be saved over the first 15 years of an NIII program, provided universal fluoridation were in effect at the start of that program. (c) Initiating special Irograms concentrating on OCLApational carcino- genesis. Research targeted on the possible carcinogenic agents found in the occupational environment is of particularly high importance in a Ion;-.-term prevention strategy. (d) Strengthening local community capacities to deal with environmental health problems beyond rodent control and lead-based oaint poisoning. This initiative would consolidate and add to some existing legislative authori ties to enable communities to deal with those mundane health problems overed by EPt, in its concentration on air and which represent a gap not c water pollution. nter for Toxicological (e) Fully developing Phase I of the new National Ce ts capacities for investigating the consequences of long- Research and i term low-level exposure to toxic substances. (f) Consolidating current legislative authorities for comprehensiv- irmunization pr.ograms and venereal disease control and to allow short-'erm developmental assistance grants to States, enhancing their capacities to respond to needed new immunization nitiativest for example, the immunization of high risk populations against influenza. (g) Developing a of health education nated by the n Ove the Bureau will be doing current health educa- tion programs support cross the Department. . An inten- sive research and eva lso be undertaken of selected health education activities NG FOR NATIONAL HEALTH INSURANCE IT. PZEPARING FOR NALIUrii%L -ird Plan for Health Is that by A nii.lor assumption underlying this Forw@ 19.'iO there will be ;ome form of Natlonal Health Insurance in full operi- tttin. Furthermore, the plan is based on the conviction, bolstered bN .,;tib.-;t,intial evidence, that our current health care system is not well prepared for the advent of z comprehensive health cl.re financing program. As suggested earlier, in ab-@olute numbers, it ar,.[iea-; that we wil.1 have @'i ufficient manpower and facility resources to cope 1,Lth the NHI demards. Th! major problems with our resources are threefold: (1) they a--e not weLl integrated into a coherent health care s,Ystem,(4hich calls or grt@atly strengthened health care planning at local, State, and r(@ional are lacking in the a@ll t to contain,the.,costs .-F health levels); (2) we ,y !,,ire (which calls for strengthened regulatory capacities, particularly at the level of State government); and (3) we have an acute shortage, both i in distribution terms, of n absolute terms and particularly Pe sonnel and facilities geared to delivering primary care. An dei- lity of cAre--is also very lerti er,.t ti,nal problem--assuring the qua here, but is dealt with as the next, separate theme. These prob ems .woLild have to be addressed in any event--but the pi-3spect o NH' heightens our sense of urgenty. The infusion of significantly more pt.rchi ing power, uould exacerbate father than alleviate these problems For these reasons, the "preparing fc NHI" theme emphasizes, firq@ the development of a planning and ri,tilatory capac-tyo and, secon,, the strengthening of our primary care services. The p.-imary care component has been further subdivided into two major parts: (1) structural reform of our health manpower training institutions and our health service (2) A focus on geograbhical scarcity areas. delivery systems, and Planninf, and. The essence of this aspect of the overall strategy is embodied in the health planning legislative proposal now pending before the Congress. sal would support the cre.@tion of a nationwide system of This propo lo6all -ba .Yjann azencieA"). eAch 6f which encies ' ould'bt responsible for e@i@ p c ear Y'defined geo- graphic ar These agencies would be private, nonprofit organizations ea. Ir representing every significant sector of the heztlth industry--consumers, providers, government, financing agents, and training institutions. In addition to developing annual plans for their respective areas, the health system agencies would plav a critical role -iln revlja,ing,,,all pr, sed ital expenditu es an '6 i," "P d al f@a ssis- 0 C' t nce or and health 6 r ',4. Additionally, there will e's"@ S ate-leve c cro.. to handle those planning issues which cu a s.; local@reas, the m le being ea It" manpower tr' nt. With these tools, the Nat ion shou d be able a much better-rationalized health care delivery system with the full participation of all concerned parties. At the same timeg as a necessary corollary to planning, and as the critical handle on the costs of health care, t osak@ouLd_!ncourage ulating both the de exopment the development of State capacities for reg v f reimbursement for health servi Of ifitiis "and t@@,r4tf-s 0 "@'already gathering experience in these two domains, A n fully. and the Department is monitoring tha@. experience care Primary are The foundation for this theme-ia Lhe developmen t of appropriate training facilities and educational experiences the attendant structural reIform of the health care system necess ry to increase the production a of both physician and allied healti worker@ ia primdr3, care. 'Priority of our health manpower initiatives concentrates entirely on is area. The other approach to primary care problems is to develop a concerted effort to channel primary care resources into those geographical areas which do not now have them, the so-called health scarc:Lt areas. Our "health scarcity" strategy includes: 1. Developing a coherent Departmental policy based on compatible definitions of "scarcity areas" (to be applied across the 17 relevant health legislation authorities), compatible data systems and indicators, tor identifying areas, and one consistent policy development process for allocating Federal resources to bealth,searcity areas--an effort which will require the full Participation of HRA, HSA, ADANHA, and the Regional Offices; 2. Working on the distribution of health manpower through both the primary care initiative referred to above, and the National Health Service Corps; 3. Targeting health services and health facil ties grants--particu- larly c ity health centers, migrant heal:h projects, CMHC'S, BM's-- on scarcity areas;,@ 4. Working with the e@te@ans -ation and the Department of to gain their cooperatio ir health care a@' ties, where appropriate, in the health scarcity areas in which thF-y are located; 5. establishing in scarcity areas, total health care systems which utilize the team approach to health care, with greatly increased use of non-physicians, and which link scarcity area facilities and manpower or backup care and con- with uLajor training and service institutions f tinuing education; L3 The major quality initiatives in the Plan flow from that strategy. For example, we will promptly initiate: 1. A very large "health care@u am,pt 8 8 i@ The dimensions of thi tudy are 11 beinf developed. 2.. A special grant program design6i to increase our@knowledge base and our methodologies for quality assessment and to enhance interest in quality assurance research. 3. Intensified evaluation of vLricus present and proposed quality-- assurance mechanisms, including the effectiveness of present criteria- development and standard-setting programs. 4. Inventory of ongoing clinical trials and an international con- ference on the science of clinical trials, including the statistical reliability of data from clinical trials, the role of randomized, double- blind studies in the definitive resolution of issues of controversy in health, and the ethics of undertaking various kinds of clinical trials where levels of "state-of-the-art" or utilization in medical practice vary widely. may 5. The establishment within ADAMRA of a quality assurance review kef@ ral to te unit, the success of which.is li be eventual insurance coverage or h. #@So_hgl. ani drug abuse services, all of which are so difficult to assess qualitatively. 6. The full implementation, through the States and Regions, of the .rec"tly published regulations to cover the approximately 70000 skilled nursing facilities and the 8,500 intermediate. care facilities. 7. The initial implementation of rectinti pe at A-rd@r in selected ambulatory care centers as prepare tion for"@ t'O@'@ertify ambulatory health ce ttrs under Medicare and Medicaid. S. The evaluation and improvement of clinical laboratory regulation, including State# as well as intrastate laboratories, and laboratories in physicians' offices. 9. Expansion of the implementation of the_P*RO prt?g a@m from t-te 150 programs planned for FY 1975 to,,M3 programs i FY 19T6- -including expansion of the PSRO mechanism into H,40's and ambulatory and long- term care. 10. Implementation of the end-stage renal disease (ESRD) program for which the final policies were recently issued, particularly the implemen- tation of the local Hed c 1_Be -@,Boardo,,,, y @em which includes standard- i a yiew setting, criter a dev@l @@t, and patient screening and selection mechanisms. 14 lologi al.s. @land 11. Improvements in assuring the q; ity of drugs, b radiological and other medical device's-. increased emphasis ;)n i-nprov-ng information for health workers.through irug labeling and warnings about adverse effecta,.all of which can serv@ as one basis for standard-setting in PSRO'O and other quality assurance programs. As the OASH continues to develop its strategy in the quality assurance area, we expect to be proposing additional initiatives. With this nation spending well over $100 billion in health care, with more than a-quarter of it in tax funds, the demand to knoi,, the quality of wha,: we're buying is certain to grow more intense. This cross-cutting health theme cannot be neglected. IV. TRACKING HEALTH STATUS AND THE HEALTH INDUSTRY In m-ay ways, achieving the goals of this theme. is necessary to the pursuit of most of the other themes. The goals are to provide reliable national statistics on (a) problems and trends in health status, (b) utilization of health services and facilities, (c) production and deployment of health manpower,.(d) expenditures on and costs of all services and resources, (e) national investments in research activities, (f) problems and trends in the production of health care and health-affecting products, drugs, devices, foods, etc. Such data are necessary nationally to con- tiriue modifying the kinds of policy decisions which this docutent proposes. They are necessary locally and regionally to guide health carc planning and regulatory decisions. Furthermore, it is important that tuch data be collected in a coherent fashion whirh avoids duplication of effort and-excessive demand on the sources of data, and which also adequately protects the confidentiality of health care information on individuals. At the present tive, that are maior data Rathering and an a@ ti @ zi" c ivi ;a in nearly every segment o; the t e a oT Research and Statistics in SSA, to the Nationa. er for Health Statis- tics in HRA, to tt2 Epidemic Intelligence Service in the CDC. Most of the mental health services provided across the nation, from State mental hospitals to psychiatric units In local, general hospitals, are tracked by the biometric programs of ADAMHA. The challenge is to develop methods of targeting Ouch data-gathering activities, and of ana;. viing their results, so that the nation's health policy development and planting efforts are grounded in the available knowledge of "what's going on.' The major initiatives to be advanced over-the ne@t few years in pursuit of this theme are,. 1. A full utilization of the recently formed Health Data Policy Committee, co-chaired by the Director, National Center for Health Statistics. and the Director, Office of Policy Development and Planning, OASH. This committee, representing all relevant partsof the Department 15 of Health, Education. and Welfare, with the additional participation of the Director of the Division of Statistical Policy, OMB, is charged with advising the Assistant Secretary for Health on specific statistical data needed for current and long-term planning and management, on policies for coordination of health statistics activities, on proposals for major health statistics systems, and on uniform data sets. h@is developi Committee will play a role in scarc@ty a@,3. 2. The major expenditure will be on the further development and implementation of the cooperative health statistics system by the National Center for Health Statistics. The numt-2r of participating States will be increased; all will accelerate their efforts to develop State and local capability to produce vital statistics, and statistics on manpower, health facilities* hospital ambulatory care,.and long-term core to comprise a natic data system. 3. We are proposing redesiming and quadrupling the household health interview survey to provide smaller area estimates, greater in-depth descriptive data, and coverage of more topics to meet the growing demands for information on health status and health care behavior. 4. There will be a significant extension of our current capacity to collect data on costs, expenditures and financing of health care and health resource utilization. At. a minimum this effort will involve the Social Security Administrationi the Ns t4 onal Center for Health Statistics, and the Biometri(i programs of ADAMRA. 5. For purposes of planning and evaluation, the Office of Research and Statistics, SSA, has begun work on a periodic updating of the 1966 ort. I figures in the pioneering PHS report, "Estimating the Cost of Illness." 6. A Long-term Care Management Information System is under develop- ment, linking data-gathering at headquarters, regional, and State levels, capable of providing current data on nursing home safety, certification, and deficiencies in compliance. A cost-of-care index will be maintained to serve for long-term care reimbursement as the Labor Department's cost-of-living index serves national economic and policy analysis. V. KNOWLEDGE DEVELOPMENT As noted above# particularly in connection with the themes on prevention and quality assurance, significant new progress in advancing the health status of the American people is dependent upon the developmen t of new knowledge, knowledge of everything from basic physiological processes to the consequences of changing a formula for reimbursing hcalth care providers. For convenience, that wide range of researdh topics is divided into two basic subcategories: health services research and biomedical and behavioral research. Fully defined, this,,@eSt a at least he r!kqp_gM pgy--an s @-kOi@iti of everi Health Services Research The focal point for this kind of research le.the au Health Services Research, HRA, which, under new leader ship, is undertaking the develop- ment o a long-needed coherent strategy for health services resea 9 cutting across @, RSA, and ADAMRA, and close y=( with similar research being conducted by SSA and SRS. As a consequence of that develop-. ment, we are anticipating that in addition to the.initiatives already mentioned--such as increased research on issues of quality assessment and more attention to the @eh4kyt uqca@. f. eal. h., du tion-- there will be at least the following ingredients to a revitalized health services research effort: 1. Assessing the range of impacts on health service delivery which the various financing schemes entail; including the impact of the advent of a comprehensive national health insurance program, various prospective reimbursement programs, etc. 2. Developing better health planning and evaluation technologies to l@upport the State and l@ca-I 1 h la ry'@ niii tives described earlier; 3. Developing a "price deflator"-for medical care (which is important because medical care remains the only item on the consumer price index where a dollar's increase in price equals a dollar's increase in costai resulting from the immense difficulty of deflating price increases for tiproduct improvements"); 4. InvestigAt ing the impacts on health care costs and productivity of wage and hour negotiation proce.sees involving, in particular, the Allied health and other supportive personnel. Biomedical and Behavioral Research While there is no serious challenge to the assertion that a major Federal role in the health industry is the support of basic biomedical and b@ , there are growing concerns as to the size and direction of that investment. For example, there are current questions about how priorities are set for biomedical research programs, why the cost of doing research is climbing so rapidly, what the appropriate rtilation should be between research and heal e needs, what the effect of i r targeted p ther there is sufficient "balanc4 ound t investment targets in the research portfolio. Depending on the answers to those kinds of ons, there re also important issues regarding the future supply questi a rese er and the r eseaESih in the education of the of health professions gp erally. For all those reasons and more, the Secre- tary of HEW has announced that appoint a National on B ollowing: Commission iome ga,.Research which would consider 17 in the context of national National needs Of biomedical research health policy; Of appropriate Federal and non- 2. Reexamination and definition Federal roles in biomedical research; 3. Analysi6 of the organizational* management, and financing needs of biomedical research. Commission on Biomedical Research initiative is Support of this National i major component of our Forward Plan for FY 1976. -It should be noted that the research plans for ADAMHA are growing out of a similar albeit ffort initiated two years ago by the NIMH. Although smaller scale e research," the ten task forces which NIHH limited to "mental health nts in established to examine the total past and present Federal investme f research from basic biological such research, spanned.every category o NINH effort chological and sociological phenomena. This processes to pay required the work of several hundred ptolessionals over an 18-month period, the results of which are still being analyzed. Thus we do not forward this initiative with an unreal assumption that the challenge a simple one. first initiative-, the NIH will concentrate during nding progress on that is planning period on areas of widely acknowledged need. The first priority is for a greater'support of basic research. Progress in many of our national health objectives in disease control and efforts is hampered by gaps in our understanding orthe I normal and pathological processes at work. Important among these cross-cutting areas of research are immunology, cell membrane research, and the cellular and molecular basis of growth, aging, and disease. other priority areas for the NIH are to devote sufficient resources to the new legislative mandates, such as the new Institute on Aging and the Diabetes Commission, and also to the Presidential commitments of recent years to strengthen our investments in research on cancer, and on heart, lung, and blood diseases. Another initiative, quite akin to the first, is to undertake analysis of the three major research planning efforts which have recently been devoted to the mental health (referred to above), cancer, and the heart, blood vessel, lung, and blood disease programs. We propose-to under- take a review of these efforts in order to determine their value for planning, pribrity-setting, and policy-making at all levels. Another initiative will be to examine those health research efforts which cut across the health agencies. For example, this planning exercise has highlighted the fact that six components of the Public Health Service have identified "long-term, low-dose exposure to potential environmental carcinogens" as important to accomplishing their missions. We will examine these several approaches to the same Area to assure that there is no unnecessary duplication of effort, and also to determine the appropriate relation of this important area of carcinogenesis research to the overall National Cancer Program. g in this Another important research effort which bears highlightin summary is that of the National Center for Toxicological Research, recently established by the Food and Drug Administration. The funds requested in FY 197@ will provide the final increment in the Phase I of effects of development of NCTR, and will-provide Improved detection repeated low and high level exposure to selected chemical compounds improved detection of individual hypersensitivity to chemicals and drugs, research to improve extrapolation relative risk to man based on studies in animals, and broadened efforts to assay mutagenic effects in exposed population groups. Before proceeding to the phase two and three proposals in the NCTR plan, the success of the NCTR techniques and concepts in the phase one operation will be evaluated. Finally, a :;ummary of the Knowledgement Development Theme must include mention of some important international activities. For example, the (J.S. - U.S.S.R. Joint Committee on Health Research is focusing on collaborative efforts in research on cancer, heart disease, environ- mental and occupational health, arthritis, aid the basic processes of schizophrenia. The NATO Committee on the Challenges of Modern Society is the vehicle for collaborative work in emergency medical services, automated clinical I.aboratories, and health care quality Assurance. Similarly, the U.N. Commission on Narcotic Drugs provides an opportunity for tackling on an international basis health problems which certainly know no national boundaries. Overview: Strengthening_the Management of Federal Health Responsibilities The success of the PES in achieving the goals and objectives set forth In the Forward Plan for Health is highly dependent upon its management capabilities. The term "management" for these purposes is construed quite broadly to include both the traditional management processes of planning, budgeting and grants, and manpower management as well as @program management of high priority efforts, particularl those which y cut across organizational lines. During this planning period efforts d toward the strengthening of the PHS manage q ility. will be directe me apab Major initiatives to-enhance the management capability for Federal health programs are: 1. Establishment of the-Health Policy Board T for lLeal h, the the Executive c rect S, has been t ii Officer, and A a and Offile Di es a@"'i It will review e Assistant Secretary on and make i@@.@;@nCai'io@ns to @ major policy directions, program initiatives, and interagency coordina- tion. The workings of the Board will be evaluated and further refined during this period. i9 2. New Planning/Budgeting Calendar H will develop an adjusted "Master Calendar" in ord'er to accommo- date earlier, joint development of issues, guidelines and analytical paper.-, upon which planning and budgeting can be based. 3. Planning/.Budgeting--Work Group A more formal coordination among OASH staff offices involved in planning, evaluation, and budgeting will be established in order to develop and implement links among management processes. This will include representation from OPDP, OAM, and other relevant offices and will be co-chaired by OPDP and OAM. 4. Tracking Policy Issues Specific heal th policy issues are dealt with at various levels in PHS and through various program and management processes. It is imperative that they be tracked and that a consistent approach to their resolution be achieved. A systematic approach to identifying and tracking such issues will be developed. 5. Evaluate Evaluation A stud of the procedures in planning for and conductin e 7 th P. It is expec e tion in e'und@itak I:ii' "Ol@o on wi t d that a major qLgf-t@i Icti' t., including a redesign of th-e"l@istem and redistris@ ities among the various levels. ti @"@f - 'Osponsibii- 6. LPIS A Legislative Planning and Implementation System has been developed which sets forth clear responsibilities for the initiation of legislative proposals, for development and submission of new legislation to OHB and Congress, and for the implementation of legislation once enacted. It will be evaluated and further refined during this period. 7. Improved wer M,-.nagement The development of a base line manpower management system which reflects workload criteria and identifies where improved manpower utili- zation is needed will be completed. In addition, manpower forecasting techniques will be developed which will identify skills required to implement the program decisions made in the planning and budgeting process. Equal Employment Opportunity Continued emphasis will be given to improving the status of minori women in PHS. EE objectives will be included in,,,@4., s. A syste roWa to da a@@@"o'iii i '6 "n @au@ Evaluation p pp 20 and to problem identification and'resolution will be developed P.:irtic-il.ar concern will be paid to special emphasis groups and to "he ificorporaf-.-I.c)r, of other factors into EEO responsibilities. 9. lm2roved Service Grantee ManaRement Over this planning period, realistic and reasonable management standards will be developed and communicated to service grantees and applicants, not only to improve grantee accountability for public funds but also to reduce barriers to utilization and service delivery. A structured system for monitoring implementation of these standards will be developed. Compliance with standards will be a condition for continued funding; ability to comply wih standards will become a condition for new funding. 10. "Arrangements' riority and Interagency Efforts A variety of "arrangeme:its" will be established and tested for managing high priority, interagency efforts such as those set forth in the programmatic themes. Such arrangements will include: 0 Establishing a staff in OASH. (Current examples of this arrangement are the designation of the Deputy Assistant Secretary for Health as the OASH policy focus for quality of care ac,-ross all health programs, the designation of the Office of Nursing Home Affairs as the policy focus for long term care, establishment of the Office of Equal Employment Opportunity in 11 to develop consistent policy and practices and to provide leadership throughout PHS for EEO.) Designating a $#lead agency4" (A current exaLiple is the desig- nation of CDC as responsible for developing an H-wide approach to health education, with the assistance of an Intradepartmental Policy Board.) Establishing an H-led interagency steering committee. (Current examples are the OPDP-led committees on the management of Section 222 (SSA amendments) research, and on the analysis of Hill issues. In addition, an interagency steering committee will be established to develop a comprehensive H approach to the health scarcity area policy discussed in the therte on this subject.) 0 Utilizing the OPS system vore extensively as a ,ehicle to track the management of interagency objectives. 0 Establishing a program review system I,.o assess overall health themes and other high priorities of H.