Senator KENNEDY [presiding]. Governor Garrahy, we want to thank you for your excellent statement. We value very much the input that the Governors have had in fashioning this legislation. I think it has been and will be a very substantial improvement over the existing planning proposal, and I think Rhode Island has had a rather special consideration in the fashioning of the legislation in the past because I think Senator Pell has pointed out to us the very unique aspects of the State, which is unique in many aspects in terms of its people, its beauty, its industry and also in some of the planning on issues and questions. I apologize for not being here for your opening statement. I will review your testimony with great interest. I have heard that you spent a lot of time on this issue and have many useful ideas and suggestions. I want to thank you very much for your appearance here. I look forward to working closely with you and it is nice to see you as a friend. Governor GARRAHY. Thank you, Senator. It is good to see you this morning. Senator PELL. I, too, am delighted that you can be here because Rhode Island can stand out like a beacon as an example to many larger States, many less innovative States. I think it is only Hawaii and the District of Columbia that have taken advantage of 1536. I would hope that the example that we have laid will be followed by others. I would like to ask you one question in connection with health maintenance organization, our HMO in Rhode Island. Do you see any ways that we should be helping these HMO's along in our new bill? Would you favor any additional amendments to let HMO's start up on their own, have their own new hospitals without the present pretty rigorous HSA and State health coordinating council approval? Governor GARRAHY. As I understand it, Senator, the present statute is very stringent as it relates to the expansion of HMO's and that some flexibility in dealing with them would allow, I think, for some desirable growth in the number of HMO's. As you know, in our own State we have one of the first federally recognized HMO's in the country. Senator PELL. The first? Governor GARRAHY. The first. Senator PELL. From a political viewpoint, do you find greater acceptability of our HMO now? You may recall, a few years ago the AMA and many others were resentful. Do you find that those have improved, or do you have any recommendations for other States to follow? Governor GARRAHY. I see the HMO as a much more acceptable form of health care delivery now. Of course, I think ours in Rhode Island and many other HMO's were pioneering for a number of ears and when you are moving onto new ground for the delivery ystem that you can expect some difficult times. But I think it is uch more accepted now and I think we find it an excellent alternative to the present health care system. Senator PELL. Do you have any recommendations on the Federal level for how we can better help in the way of distribution, the neighborhood health centers, because we all know the terrific headaches and very real problems we had there, and they are really not going the way we originally envisaged. What could we do on the Federal level to give them a little vitality and life, besides money? Governor GARRAHY. Besides money? I think you could really have a more adequate effort in State health planning which would integrate them into the system. We should have a State health system that will provide support to all of the aspects of a health delivery system, including MO's, neighborhood health clinics, and so forth. I would like to point out that the bill here in the Senate specifies a relationship between the delivery of mental health services and community mental health clinics. I think that is very important that they be part of the total integrated planning and health system in the State. Senator PELL. Mental health and regular physical health should all be in the same ball of wax? Governor GARRAHY. That is correct. That is the way I feel about it, Senator. Senator PELL. But we have done a very good job in Rhode Island in the fact that we reduced some of our custodial population and gotten more and more people out in the mainstream. Governor GARRAHY. Ihat is right, and we are moving very strongly toward the deinstitutionalization of many people while trying to strengthen our community mental clinics and community mental health facilities so that there is not an overreliance on long-term institutionalized care. Senator PELL. Thank you. Senator KENNEDY. One thing is that we have been woefully behind in terms of the development of the HMO's. I think one of the problems has been in terms of this existing planning law with a very strong role for the providers and for those within the profession there has been considerable reluctance. I think there is a variety of different problems in the fashioning of the bill itself. We have had a lot of difficulty in getting that moving. The regs have been slow in developing, but also, even within the planning. I can't speak in terms of Rhode Island, where you have had a good program, but generally, in other parts there has been a lot of reluctance and with the mechanism established in the planning legislation, it has been exceedingly difficult for them to move ahead, which has been part of the problem as well, plus an administration that never believed in them. We passed, 5 years ago, an authorization for $2 billion for HMO. We had $18 million. I think it was $18.5 million last year appropriated. We just had to compromise the thing down so much and we had an administration that fiddled around with it for such a period of time we had a very difficult time. But I am glad to get your own strong commitment in terms of the HMO's, and the practical experience. Yours is a prepaid program, too? Governor GARRAHY. Yes; it is. Senator KENNEDY. Is it complete prepaid? Governor GARRAHY. Yes; it is complete prepaid. Senator KENNEDY. Have they done any assessments in terms of comparison to, for example, welfare averages under the prepaid program versus those that are not covered? Governor GARRAHY, I am not sure if we have done that or not. Senator KENNEDY. We have seen in our own State-which is a prepaid program-they have reduced the welfare by about a third even with a balanced group of subscribers. You always have to depend on that. Governor GARRAHY. Right. Senator KENNEDY. But in terms of the harbor community plan, for example, which was set up to be representative, reduces significantly the welfare kinds of cost, and they have reduced significantly the hospitalization. As an alternative to developing real competition within that health delivery system this is certainly something we should support. Governor GARRAHY. The concept of prevention which can reduce people's needs for long-term hospitalization, thus avoiding the expense of that hospitalization, is paramount in the way HMO's deliver their care. Senator PELL. I have one more question, Mr. Chairman. We are all aware of the fact that single State health systems agencies and other States operating under 1536 manage a bit differently from the large multi-HSA States. Early on in the administration of the law there was some slowness at HEW promulgating the special regulations for 1536 States, regulations which could help avoid the excess bookkeeping and paperwork. I am wondering, from your end as a Governor, if you are in a position to say that this program has been resolved and are you satisfied with the regulations that HEW has put out as they now pertain to single-State agencies, HSA States? Governor GARRAHY. In answer to your question, Senator, part of the problem has been a great deal of excess paperwork. I think if we could eliminate a lot of the paperwork generated under Federal regulations, it would help us quite a bit. Senator PELL. The actual regulations, do you find them satisfactory? We are agreeing with you about the plethora of paperwork. Governor GARRAHY. I think generally we are satisfied with the regulations as they pertain to our SHCC in Rhode Island. Senator PELL. Good. Thank you very much indeed. Senator KENNEDY. Governor, we are delighted to have you and we hope as this process moves forward we can call on you for advice and counsel, for help and assistance, too. We are delighted to have you here and thank you very much for your excellent statement. Governor GARRAHY. Thank you very much. I would like to thank Mr. Champion from HEW, who I understand gave way for me this morning so that I could get here early and move on. Thank you very much. [The prepared statement of Governor Garrahy and additional material supplied for the record follows:] TESTIMONY BEFORE UNITED STATES SENATE SUBCOMMITTEE ON HEALTH AND SCIENTIFIC AFFAIRS ON AMENDMENTS TO TITLES XV AND XVI OF THE PUBLIC HEALTH SERVICE ACT BY J. JOSEPH GARRAHY, GOVERNOR OF RHODE ISLAND CHAIRMAN, NATIONAL GOVERNORS' ASSOCIATION SUBCOMMITTEE ON HEALTH POLICY February 2, 1978 Mr. Chairman, members of the Committee, I am honored to be with you. It is my pleasure to report to you this morning on the implementation of the National Health Planning and Resources Development Act of 1974 (PL 93-641) for the National Governors' Association and for the State of Rhode Island. I would like to point out to any casual observers in the room that it is not unusual to have three Rhode Islanders working on the same difficult problem. Senator Pell, Senator Chafee and I may disagree from time to time on some details but we are unanimous in our willingness to work for the health of I pledge my continued support to the senators as they try our constituents. It will not be possible, Mr. Chairman, to review in my oral testimony all of the recommendations which the nation's Governors would make to you for improving this vital and controversial statute. With your permission, I would like to emphasize several of our major findings and to submit a lengthier written statement for the record. I can assure you that neither Governor Herschler nor I would presume to appear before you on behalf of the National Governors' Association if we were uncertain that a consensus existed among our colleagues on the changes necessary to make the national health planning law work. There is a consensus and it is based upon our belief that the law cannot work without the active participation of state government in partnership with responsible federal officials. We are certain that access to medical care at reasonable cost cannot be assured unless regulatory and resource development decisions at the national and state level are coordinated through an effective state health planning system. It is our belief that this law and your hearings have the potential for moving the nation one step closer to that goal. |