ing what we think transpired today, along with the suggestion they take those regulations and send them back to whoever drafted them. Ms. REESE. Thank you.

Mr. HALAMANDARIS. Our next witness is Ms. Helen L. Rawlinson, director of home care, Blue Cross of Greater Philadelphia.

STATEMENT OF HELEN L. RAWLINSON, DIRECTOR OF HOME CARE, BLUE CROSS OF GREATER PHILADELPHIA

Ms. RAWLINSON. Mr. Chairman and members of the subcommittee, during the past 15 years I have been engaged in a cooperative endeavor with hospitals and community home health agencies to develop a home health care system in the five counties which comprise the southeastern Pennsylvania area. A significant aspect of this effort has been to study the potential value of home health care in relation to its effect on the quality of patient care and on the cost of health care, and to initiate necessary actions to increase its appropriate use by physicians and their patients. Our work has involved the establishment of patient care planning procedures in participating hospitals: the development of a uniform home health care administrative plan; standardization of operational procedures, medical record forms, management reports, and the recording of statistical and financial data; and the structuring of effective linkages among hospitals and community home health agencies. Guidelines have also been established for the identification and allocation of costs. incurred by hospitals in the administration and delivery of homehealth care. This aspect of our work has been particularly important because it was necessary for Blue Cross of Greater Philadelphia to determine whether the allowance of benefits for such services would require the generation of substantial amounts of new money, or whether the appropriate use of home health care for patients whose period of hospitalization could thereby be lessened would result in the economical redistribution of existing funds.

In the fiscal year ending June 30, 1974, a total of 1,545 patients. were admitted to the participating intensive home health care programs. Medicare beneficiaries represented 55 percent of these patients; an additional 8 percent were medicaid recipients. A total of 51,645 home care patient days were provided, for an average length of stay of 33.4 days per case. The average length of stay on home care for Blue Cross subscribers was 28.4 days; for medicare beneficiaries 35.1; and for medicaid patients 32.1 days. In addition to care by nurses, therapists, medical social service workers, and health aides, the hospitals provided visits by technicians, laboratory procedures, drugs and medications, diagnostic and therapeutic radiology, electrocardiography, medical supplies and equipment, oxygen, and various other hospital services. A total of 36,596 units of service were provided, an average of 23.7 units per patient, or an average of one unit of service every 1.4 patient days. Nursing, therapy, social service, and health aide visits represented 55 percent of the total units of services supplied.

The total cost of all services amounted to $780,408—or $15.11 per patient day. According to a retrospective review of the complete medical record by a professional nurse on my staff after each patient

was discharged from the intensive home care service, the period of inpatient hospital care was lessened by an estimated average of 12 days per case. The gross value of these days based on the related hospital average inpatient per diem cost was $2,132,390. The estimated net value was $1,351,982 or $875 per case.

The conditions of individuals for whom home health care is an appropriate treatment modality may range from complex and fluctuating illness situations to relatively controlled disabilities. Therefore, home health care should encompass a wide range of professional, paraprofessional, technical, and related medical, social, and supportive services. Home health care should be comprehensive and include intensive, intermediate, and maintenance structures of services to insure that the needs of patients are served effectively and efficiently. These frameworks of services tend to rationalize the system and to foster an orderly continuum of care that is related to the changing needs of patients, also to the prevention of disease and to the promotion of health.

Professional policies and quality standards applicable to the delivery of home health care should be established by recognized national professional accrediting organizations, and the enforcement of such policies and standards should be objectively monitored through professional audits. Also, standardized utilization review processes should be consistently applied and made a part of regular program

evaluation.

UNDERSTANDING OF CHARACTERISTICS

An effective home health care system requires structuring, through appropriate administrative linkages, the resources of hospitals, community home health agencies, and social service organizations to support the delivery of all categories of home health care. An understanding of the characteristics of the three categories of home health care is necessary to establish planning objectives, legislation, and reimbursement policies which are logically supportive of the home health care system.

Intensive home health care is appropriate for patients who: require active treatment and/or rehabilitation of an unstable disease or injury; require a concentrated degree of physician and professional nursing management; require centralized administration and professional coordination of the plan of treatment and the various services provided; or who, without the availability and use of intensive home health care, would at the time of admission require inpatient care.

Delivery of this category of home health care requires access to and includes in varying degrees the array of professional, technical, and health-related services usually provided by hospitals to inpatients, plus ambulance or other special transportation services that are medically required and cannot be furnished via public or private transportation resources which are available to the patient. All services are provided under active physician and nursing management. They are provided through a central administrative unit and are professionally coordinated by a registered nurse.

Intermediate home health care is appropriate for patients who: require active treatment and/or rehabilitation of a relatively con

trolled disease or injury; require a lesser degree of physician supervision and management; or who require primarily nursing care and/or physical rehabilitation and health aide services.

Delivery of this category of home health care requires access to and includes in varying degrees the professional nursing care, physical, respiratory, and occupational therapy, speech pathology, medical social service, and health aide services which are usually provided by community home health agencies.

Maintenance home health care is appropriate for patients who are relatively stable medically; have reached a plateau in their rehabilitation; and require periodic assessment of their medical condition and mental health and regular monitoring to insure, as possible, maintenance of the rehabilitation achieved; or who require assistance with activities of daily living and/or supportive personal care services.

Delivery of this category of home health care requires access to and includes in varying degrees the various professional and related health services which are usually provided by community home health, social, and welfare organizations.

While increasing attention is being given to home health care as one of the most needed health care resources and as potentially one of the most humane and economical alternatives to unnecessary and undesirable institutional care, its growth and development is thwarted by regressive legislation and associated regulations. An example of this is the benefit definitions and allowances of titles XVIII and XIX of the social security law and associated reimbursement policies.

The proposed medicaid regulations published in the August 21, 1975, Federal Register further complicate the situation by opening the door to more fragmentation and by mandating further administrative variations that are unproductive and will further increase provider operating costs.

HOSPITAL ADMINISTERED SERVICE

In Pennsylvania the State welfare department recognizes intensive home health care as a hospital administered service. Up to 180 days of benefits are allowed for medicaid recipients for which the State pays hospitals $5 per patient day. This payment rate has not been changed since the benefits were first allowed in 1963. As previously indicated, the cost to the hospitals for providing such services was $15.11 per day in 1974 and presently the cost is about $18 per day. According to our estimate of a lessening of inpatient care by an average of 12 days per home care case, it cost the hospitals $47,036 to reduce costs to the State $132,245 during the fiscal year ending June 30, 1974. If the State had paid the hospitals the cost of providing home health care, the net reduction would have been $85,209 or $704 per case. The effect of this adverse financial experience is that one program closed July 1, 1975, and it is virtually impossible for any hospital serving a significant number of medicaid recipients to establish a home care program. Obviously, this deprives all patients who might benefit from intensive home health care from receiving such services. At the same time the community is deprived of the

cost reductions which would result from the establishment of additional intensive home care programs.

The net value of an intensive home care program is about $200,000 per year. I am aware of five hospitals in Philadelphia which are interested in establishing programs, but cannot sustain the financial losses that would result from providing care to medicaid patients. This, in effect, increases the cost of health care in the city of Philadelphia by $1 million per year, a sum that would cover the cost of needed intermediate home health care to approximately 5,500 persons. It is my earnest hope that Congress will carefully examine the laws and regulations which now apply to home health care and develop new legislation that will promote and support the economical growth and development of a rational and effective home health care system in the United States.

Thank you.

Mr. HALAMANDARIS. Thank you for an excellent statement. We appreciate your reading it into the record. I happen to share many of your sentiments.

Ms. RAWLINSON. Thank you.

Mr. HALAMANDARIS. I would like at this time to come to our next panel member, a good friend of ours, Janet E. Starr, executive director of the Coalition for Home Health Services in New York State.

It is a real pleasure to welcome you here.

STATEMENT OF JANET E. STARR, EXECUTIVE DIRECTOR, COALITION FOR HOME HEALTH SERVICES IN NEW YORK STATE

Ms. STARR. Thank you.

I am Janet E. Starr, executive director of the coalition for Home Health Services in New York State, a foundation-funded effort to stimulate the development of comprehensive programs of homehealth services in New York State. The coalition's purpose and program are described in the attached brochure. Its offices are located in: Syracuse, N.Y.

I am here today in response to a request from this committee for technical advice and recommendations on the regulations proposed for home health services in medical assistance programs in the Federal Register of August 21, 1975.

The intent of the regulations-to increase the availability of home health services and increase their use is one which the coalition wholeheartedly endorses. I wish to comment today on two portions of the proposed regulations: that which would permit single-service agencies to become medicaid providers and that which would permit certification of proprietary agencies.

THE NEED FOR COMPREHENSIVENESS

Experience with home health care in New York State demonstrates that a broad range of professional and supportive services must be available if home care is to meet the needs of the persons for whom this is the treatment of choice. Some patients may need

one or two services. Others may need several. These services may be provided directly or through contracts, but they must be coordinated, with provision for periodic reassessment of the individual's needs by a health professional. If a home care program does not offer an array of services adequate to permit responsiveness to patient needs, it will not be possible to care for many patients who could be cared for at home. Instead of providing a dependable alternative to institutional care, it will foster it unnecessarily.

The portion of the proposed regulations which permits singleservice agencies to become medicaid providers is ill-advised and regressive. It undercuts the progress made toward requiring a broad range of services. It ignores the fact that single-service agencies may contract with other sources of service to broaden the range of services offered. It is at odds with other sections of the proposed regulations which require that patient services be coordinated and that State plans make three services available: nursing, home health aide, and medical supplies and equipment.

Home health care is increasingly recognized as an integral part of the continuum of care that must be available to our citizens, but public policy has not taken this into consideration when health care resources are allocated. Home health service development has been underfinanced. Service availability is uneven and nearly nonexistent in some rural areas. Further piecemeal development seems unwise when planned development is imminent under Public Law 93-641, the National Health Planning and Resources Development Act. May I say, parenthetically, the law is rather sketchy on this point. I recommend that single-service agencies not be permitted to become medicaid providers.

The other portion of the proposed regulations on which I will comment is the one which would permit proprietary agencies to become medicaid providers whether or not the State has a licensing law. This is a very difficult and controversial issue. The coalition has not studied this, nor has it taken a stand on it. My comments, therefore, will be those of an individual speaking from the perspective gained during 14 years of work with home health services at the State and local level.

I don't know whether or not proprietary services should become medicaid and medicare providers of home health services. I feel there are fundamental issues that must be confronted before a public policy decision is made. The issues that concern me are outlined below:

ISSUE No. 1: CONSUMER PROTECTION

Proprietary services fill a need not being met by public and nonprofit organizations. They would not exist otherwise. However, they are not regulated in States where they are not licensed, and thus consumers of their services are not given the protection extended to consumers of services from nonprofit and public agencies. Proprietary agencies can provide services of high quality, but the consumer has no assurance of this and no accountability to the public is required. Presumably, allowing proprietary agencies to become medicaid providers would provide consumer protection and require accountability.