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improving the corporate planning processes of all health agencies. By holding each hospital and other health agency responsible for developing a viable and defensible community oriented planning process, the health care system can become more effective, more systematic, and more responsive to community needs and demands. Reduced costs and improved effectiveness will flow from strengthened planning at each level of operation.

Under Public Law 89-749, the Comprehensive Health Planning Act of 1966, every area can have a regional comprehensive health planning agency-backed up by a state comprehensive planning agency and by a strong federal commitment to stimulate improved planning processes in every health agency and institution. This new law can have the most profound impact on the cost of delivering quality health care to people. The Allegheny County experience suggests some guidelines for this planning program.

(1) Emphasize planning process rather than plans

The comprehensive planning agency should not make plans for hospitals and other agencies. Rather, it should help operating health agencies to improve their planning processes.

A planning agency which attempts to plan for the health agencies risks the same reactions as parents who attempt to plan their children's lives: healthy but destructive rebellion, or unhealthy loss of capacity to change. Officials of operating health agencies are not children; they are mature, independent responsible people who have demonstrated great capability in achieving institutional objectives. With appropriate incentives and assistance in formulating broader goals and objectives, they are quite capable of planning sound programs in relation to community needs. The complex and delicate interpersonal and interagency relationships involved in implementing comprehensive planning require a commitment that can be obtained only if those responsible for the implementation are also responsible for the planning.

A comprehensive planning agency which concentrates its effort on review of building plans developed by operating agencies will also be of limited value. After an operating health agency has carried out the difficult and extremely time consuming process of developing a building plan, there is a sense of emotional involvement and commitment that permits very little outside influence. Unless the plans are patently absurd-they hardly ever are-it is too late to do much good.

Planning on a more or less systematic basis is a continuous process at each health agency. These processes-especially formulation of goals and objectives— must be strengthened. The primary job of the comprehensive planning agency is to help improve planning processes.

(2) Require All Health Agencies to Plan Comprehensively

Comprehensive planning agencies should attempt to improve the planning processes of all health agencies, not just the hospitals. While the hospitals are the key agencies in health care delivery systems, they must interact with a wide variety of other agencies which must also be engaged in planning in relation to comprehensive health services.

Especially important is attention to the planning processes of health agencies which are not directly responsible for patient care. Accrediting agencies, licensing agencies, financing agencies, educational institutions-all of these need improved planning processes that reflect a commitment to comprehensive care. A health care provider agency has difficulty planning in terms of comprehensive care if those agencies which supply it with capital and operating funds, with license, prestige and trained personnel do not reflect the same commitment. A hospital which can meet all the standards of license, accreditation, Blue Cross, Title XIX and Medicare participation has difficulty understanding why it must recast its goals and programs. Delivery of comprehensive health care as a goal must permeate the entire health establishment.

(3) Make appropriate use of sanctions and incentives

A comprehensive health planning agency will function most effectively if it does not exercise direct controls. The health establishment already has a great many agencies which exercise and respond to formal and informal sanctions and incentives. Many agencies which exercise sanctions on health agencies are in turn influenced by sanctions of other health agencies. For example, the hospital's power to grant or withhold staff privileges is a strong potential in

centive and sanction on the practicing physician; the hospital, in turn, is subject to strong incentives and sanctions exercised by a wide variety of agencies such as the state Hill-Burton agency. All agencies should be guided by sound planning in exercising their sanction power-planning related to delivery of comprehensive health care. The comprehensive health planning agencies should strive to improve the planning processes of sanction and incentive agencies to help them to make maximum impact on improved delivery of health care services. Planning agencies should not usurp the operating responsibilities of these sanction agencies; rather sanction agencies must become involved in comprehensive planning themselves.

The greatest conceptual fallacy about areawide health planning today is that one form of sanction-control of capital funds-by itself can create more systematic planning. It hasn't worked anywhere.

Why should a hospital or health agency which has not planned its future in terms of the comprehensive health needs of people be entitled to accreditation? to licensure? to tax exemption? to all medicare funds (not just depreciation funds)? to public welfare payments? to Blue Cross membership?

All agencies which exercise sanction or incentive in the health field need to re-examine their programs and be guided to a strong commitment to comprehensive health care.

(4) Determine priorities on the basis of innovation in delivering care

Establishment of priorities is an inherent part of the planning process of any health agency. As planning processes of individual health agencies become more coordinated in relation to comprehensive health needs of the same people, many priority decisions will become products of inter-agency agreement. Agencies with operational responsibility for disbursing limited funds among different institutions will need to develop priority criteria relating to their own role in promoting improved delivery systems.

In the long run, determination of priorities will be one of the most difficult areas of planning and decision-making, because ethical considerations will be involved. In the short-run, and for a good number of years, most health agencies will have sufficient difficulty in re-focussing goals and objectives that priorities can be assigned to acceptable programs on a "first-come, first-served" basis. Innovative response to comprehensive health care needs of people can be the primary priority consideration. Overstructuring of objective priority considerations can be a stultifying force.

As with sanctions and incentives, a comprehensive planning agency without operational responsibility should not assume responsibility for determining priorities. It can advise on priorities. Even more important, it can help all health agencies and institutions to build into their planning processes priority considerations related to improved delivery of health care for people.

(5) Avoid Overemphasis on Precision

Health planning must be increasingly based on proven facts, and on ideas and programs that can be qualified, tested, and evaluated. But there is danger in over-reliance on precision. The current problem is not as much lack of exact knowledge about delivery systems as lack of commitment.

Precise quantification in the health field is difficult, expensive, and slow. Most basic concepts in the health field-for example, quality-have not yet been adequately defined or quantified. Yet, quality of care can be and has been improved, because of the deep commitment to it. Quality could probably be improved more efficiently if better concepts, definitions, measurements, and data were available. But we cannot and should not wait.

The same approach applies to planning for improved delivery systems of comprehensive care. We cannot wait for precision. The basic direction is clear enough to proceed simultaneously with efforts to improve delivery systems and to develop measurement techniques in a mutual feed-back process.

(6) Coordinate Health Planning and Community Planning

In the long run, the greatest potential for reduction of medical care costs probably lies in recognition that investment in other forms of conservation and development of human resources may frequently contribute more to human health than direct investment in health services. Investment in neighborhood development, housing, education, recreation, and welfare services are examples. P. L. 89-749 goes a long way towards making the comprehensive health plan

ning agency look beyond the limits of medical care, and on to environmental health, public health, and so on. It may be too soon to hope for, but we also need to relate comprehensive health planning to the planning which is directed at the total community. Close coordination of community planning and health planning almost unknown today-may create a planning environment which will produce health care statesmen capable of deciding that application of all medical advances are not always in the community interest.


Systematic planning by each institution and agency holds the answers to rising medical care costs. But patience and perseverance are required. Dramatic results may be hoped for, but should not be anticipated in short order. Systematic development must deal with the weight of tradition, custom, and vested interests, and with the special type of momentum and vitality of established institutions. The health field harbors an unusual mixture of sentiment, prejudice, and authoritative knowledge. There will be progress in the reorganization of medical care, but decades of development are not likely to be telescoped in one year. Everyone in the system is to some extent a prisoner of his education and experience. Everyone in the system can be expected to initiate or adapt to some change, but Great Leaps Forward are not to be expected. An entire system of health care will not be quickly converted to conform to models designed by the best planners. Facts and logic are not enough. To improve health care delivery systems requires a special logic that considers the stubbornness of men and policies and institutions, as well as the logic of rational thought.


(George A. Silver, M.D., Deputy Assistant Secretary for Health and Scientific Affairs, Department of Health, Education, and Welfare)

We are all aware of the dramatic strides which have been made in this country in the health picture of the entire population. It is the very success of modern medicine in preventing epidemics and curing or controlling diseases once usually fatal, that has brought chronic illness and the illnesses of old age to the fore as the major health problem of our time. Let me emphasize though that millions of older Americans enjoy relatively good health. Most of them can be almost as active as they were when they were many years younger and even large numbers of those with disabilities have learned to live with them, and accept their limitations.

Yet we must face the fact that the majority of the aged have become the prey of at least one disease in their lifetime that sticks with them as long as they live. About 15 million older Americans have at least one chronic condition, although it is true that less than one-half of those with a chronic ailment have some limitation on their activities. We all know that many of those with disabling illness might be in better health today if known preventive and restorative services had been promptly used. We do not know the causes and cures of all the diseases that come with old age. Until research efforts give us more information on the causes and cures of most chronic disease, we can only apply palliatives. Still, the most potent weapon against them is early detection and prompt treatment. However, too many of today's older people have not received treatment early enough.

Part of the problem may lie with the manner in which older people decide to seek medical care the evidence shows a tendency to delay going to a physician until the later stages of a disease. The National Health Survey indicated that during the year ending June 30, 1964, one out of 4 people 65 or older had not been to a physician. But the entire responsibility cannot be placed on the aged; they have not always been made aware of the need for regular check-ups or the dangers of self doctoring or ways to avoid accidents. And we know that there is a tendency among many to treat themselves when they really need to see a physician. People often use medications which have worked on similar symptoms of neighbors and friends. Sometimes they wanted to avoid the cost-sometimes they were just afraid of treatment and hospitals. A large proportion of older

Delivered at the 12th Annual Conference on Aging of the Western Gerontological Society, Monday, Sept. 19, 1966, San Francisco, Calif.

people are victims of poor nutrition because they are caught up by food fads or by poor lifetime food habits-some may suffer because they lack interest in eating, perhaps because they have to eat alone. Accidents, many of which are preventable, take a high toll among older people. They have almost twice as many home accidents as the average adult.

A good deal of the fault for these conditions has to be borne by physicians, communities, States, and the Federal Goverment. We have been slow in starting health programs for the aged. But recently enacted legislation should go a long way toward meeting many of these problems.

Medicare will modify dramatically the existing patterns of utilization of health services by older people and perhaps the entire population. I would like to present some important measurements of utilization of health services by older people as we move into the Medicare age.

Receipt of medical care in this country is obviously dependent on the social, economic and demographic characteristics of the population. If a person is aware of his illness and recognizes the need for treatment, if he lives in an area where medical care facilities are accessible, and if resources are available to pay for his care, then he is more likely to receive medical treatment than if he were living in less favorable circumstances.


During the period July 1963-June 1965, the National Health Survey shows that hospitalization increased with advancing age, from 115 per one thousand people under 45 years to 186 per one thousand people 65 years and older. The length of hospital stays increased although the proportion of patients with surgical treatment decreased with the increasing age of the patients.

Among people 65 years and older the rate of hospitalization was higher among men than among women and rates of hospitalization in the Southern region and among non-farm residents living outside of metropolitan areas was higher than in other regions. During the survey period, the annual number of hospitalizations for the total population was 24,012,000. People 65 years and older accounted for 3,196,000 or 13.3 percent of these discharges; they account for only 9.4 percent of the total population. During the past 5 years the rate of hospitalization among persons 65 years and older has increased 28 percent.

Information on the relation between hospital utilization by older people in the various income brackets is equally significant. Among people 65 years and over, the highest rate of hospitalization was among those with family incomes of $3,000 to $4,000 and among those in the income group $10,000 and over. However, the length of hospital stay was considerably longer for the latter group (14.0 days) than for the former (11.0 days). Income of older people, then, has had a significant effect on hospital utilization in the pre-medicare age.

We also have information on hospital utilization related to the living arrangements of older people. Approximately one-half of the aged population is married and living with relatives (mostly married couples); one-fourth live with relatives but are not married (widows primarily); and the remaining one-fourth either live alone or with non-relatives. Among those 65 years and older, the rate of hospital discharges was highest (232.0 per 1,000 persons) and the hospital stay longest (19.7 days) among those living with non-relatives. This is so because this group tends to be older and there is need of more medical care.

Differences in the amount of hospital care for older people result not only from differences in age, sex, family structure, and income; they are affected also by characteristics of medical practice and the over-all supply of hospital beds, which in turn may reflect whether the area is rural or metropolitan. If hospital beds in a community are in short supply, the acutely ill with have first call on the available beds and hospital stays will be on the average shorter than if beds are plentiful. While we have known for years that much of the hospital stay for older people is unnecessary, that appropriate home care services are not only as effective as, if not more effective than, hospital services, and certainly more desirable from the patient's standpoint, home care has not flourished in this country. Now, with the introduction of Medicare, we are seeing a rapid multiplication of home health services. This will undoubtedly have an important and useful influence on hospital utilization by older people. And for the rest of the population as well.

83-481 0-67-pt. 1-15

Utilization of nursing homes and related facilities

There is much less information about the extent of utilization of nursing homes and similar types of medical facilities by aged persons than there is of hospitalization. Most population surveys relate primarily, if not exclusively, to people who are not living in institutions. Over 600,000 persons aged 65 and older were in some type of institution at the time of the 1960 census. From subsequent data it has been estimated that some 23,000 non-hospital facilities with a resident capacity for 592,800 persons are providing or supporting services to chronically ill and aging persons.

Skilled nursing homes which provide skilled nursing care as a primary and predominant function total close to 10,000 with approximately 338,700 patients. There are about 11,000 other homes providing primarily domiciliary or personal care with 207,000 residents-but which may also provide some skilled nursing care. And there were some 2,200 residential care homes wtih 47,000 residents providing primarily sheltering functions but which also may provide some skilled nursing care.

Very few of even the best skilled nursing facilities provide restorative and rehabilitative services; although there is some evidence that physical rehabilitation for chronically ill bedfast patients over 65 might restore many to ambulation and partial self care, and some of those so restored would not require continued institutional care.

There is a rather grim picture in view of the fact that all of the patients requiring institutional care of this kind are not in institutions, and that a significant number of the beds that are available are not in institutions of sufficient safety or quality.

More skilled nursing home beds are becoming available and government help is increasing. Acceptable nursing home beds have doubled in the past 10 years. The Public Health Service will spend $70 million in 1966, almost double the previous annual expenditures, under the Hill-Harris amendments to the HillBurton program. In the past 20 years, Hill-Burton funds have helped build 2,000 clinics and health and rehabilitation centers, and 350,000 hospital and nursing home beds.

Other Federal agencies are providing funds for the construction and expansion of extended care facilities. The Small Business Administration lends money to privately owned establishments. The Federal Housing Administration mortgage insurance programs covered 38,000 new beds in 1965 compared to only 200 covered just 5 years earlier.

The Area Redevelopment Agency also can make loans for private nursing homes in redevelopment areas.

It is hardly news to this audience to say that the very elderly predominate among the nursing home population. According to a survey some 10 years ago, of the 38,000 patients in nursing homes in some 13 States the average age was 80 years. More recent studies in Michigan (1957) and Pennsylvania (1959) reported the average age to be 76 and 80 years respectively. Data from a 1962 North Carolina study indicate that 66 percent of the patients were over 75-23 percent were over 85. A country-wide survey in 1963 gave an average age of 77.6 for persons in nursing homes.

Physician visits

Estimates derived from the data collected during the National Health Survey show that the rate of physician visits was 4.1 visits per person per year for people under 45 years, 5 for those 45-64 years of age, and 6.7 visits for those 65 years and older.

The proportion of total physician visits in the home has been decreasing with a compensating increase in the proportion of visits to the physician's office or to hospital clinics. This change in the pattern of utilization is true for people of all ages.

Among persons under 45 years the rate of physician visits increases with the amount of family income; however, for persons 45 years and over the pattern of physician's services is not so closely related to income, but the higher rate of hospitalization noted for persons 65 years and older in the income groups $3,000 to $4,000 and $10,000 and over is reflected in the comparatively higher rate of physician visits in these groups.

The impact of medicare on patterns of utilization

Probably no other piece of social legislation in the history of our country will have a greater impact on the patterns of utilization of health facilities by the

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