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Functional fiefdom, poverty model or individualism? Development of intergovernmental relations in health planning
Health Policy and Education, 2 (1981) 153-165 Elsevier Scientific Publishing Company, Amsterdam - Printed in The Netherlands
FUNCTIONAL DEVELOPMENT
153
FIEFDOM, POVERTY MODEL OR INDIVIDUALISM? OF INTERGOVERNMENTAL RELATIONS IN HEALTH PLANNING DAVID C. COLBY
Institute of Government
and Public Affairs, University of Illinois, Urbana, IL 61801,
U.S.A.
ABSTRACT The United States national government has the power under the National Health Planning and Development Act of 1974 to establish and exercise legal control over a system of Health System Agencies, State Health Planning and Development Agencies, and State Health Coordinating Councils. Although the national government appears to have the legal powers necessary to direct and control the health planning process, a federal system has difficulties in the implementation of planning which has centralized goals or direction. The states and regions have the potential power to weaken the strength of the national government. Three trends in the developing relationship between the national, state, and regional units in health planning are discussed. The first, the functional fiefdom, consists of self-perpetuating, narrow purpose agencies which are not responsible to local or state-wide elected officials. These are professional bureaucracies which create and reinforce cozy relationships with supportive interest groups. The second trend, the poverty model, includes the lack of control by local elected officials, a large role to nongovernmental actors, and a direct relationship between Washington and the regional planning agencies. The last trend appears to be an individualistic one with every unit fending for itself. A case study of Massachusetts along with supplemental materials from other states is presented to illustrate the trends.
1. National
Health Planning
Hale Champion, Undersecretary of the Department of Health, Education and Welfare, indicated that the National Health Planning Act “. . . relies on a kind of atomic bomb theory of penalty. . .” (U.S. House, 1979: 108). The analogy assumes that intergovernmental relations in this area develop with an overwhelming superior power at the top which forces the subordinate units to behave contrary to their own desires or interests. This is certainly not the case. At the most, there is a centripetal force pulling a tangled web of specialized governmental and nongovernmental agencies. This paper examines the developing patterns and speculates on the future trends of intergovernmental relations in health planning. Three trends, the functional fiefdom, the poverty program, and the individualistic, are identified. A case study on Massachusetts along with supplemental materials from other states is presented to illustrate the trends. The parameters of these intergovernmental relations are fixed by the
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0 1981 Elsevier Scientific Publishing Company
154 National Health Planning and Development Act of 1974, whose purpose is to support high quality health care, to create equal access to health care, and, most importantly, to control the rapidly rising costs of health care. In order to accomplish these goals, a system of regional Health Systems Agencies (HSAs), State Health Planning and Development Agencies (SHPDAs), and State Health Coordinating Councils (SHCCs) was established. The 205 Health Systems Agencies develop health plans, periodically review all health services, review and approve or disapprove applications for federal health funds, and, after the passage of state certificate of need laws, review all substantial expansions of, or modifications in, non-federal health facilities. This national law further requires that State Health Planning and Development Agencies perform the staff functions for the State Health Coordinating Councils which are the citizen decision-making bodies for state health planning. These state and regional agencies will develop Health Systems Plans, Annual Implementation-Plans, and State Health Plans, all of which elaborate the criteria for decisions such as those on certificates of need. The Department of Health, Education and Welfare exercises legal control over these various health planning agencies through the funding and designation processes. In the designation process, an organization is selected to be the HSA. Then, the selected agency is conditionally designated. In order to meet requirements for full designation, an HSA must (1) develop a Health Systems Plan and an Annual Implementation Plan, (2) collect and analyze health data, (3) coordinate activities with appropriate agencies, and (4) review the need for new health facilities (Cain, 1978a: Attachment). When an HSA is capable of executing all these functions, it is fully designated by the Secretary of HEW. This full designation is required within 24 months after the conditional designation. The law, however, provides that HEW can extend a conditional agreement up to one year in order to “enable the agency to qualify for full designation,” if there are “unusual circumstances” (Cain, 1978b: 1). HEW must review the designation status every three years. A fully designated agency which executes appropriately its functions would be continued in that designation. A conditionally designated agency may be fully designated, continued in conditional status, or terminated depending upon its performance. The funding level of the HSA is tied to its designation status. The fully designated HSA is fully funded on a per capita basis; the conditionally designated HSA is funded at a level which reflects its development. The State Health Planning and Development Agencies (SHPDAs) are also required to proceed through a designation process. For full designation, the state must (1) establish a SHPDA with the authority to implement health planning, (2) organize a State Health Coordinating Council which reviews all
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plans and budgets, (3) develop a state health plan, (4) perform Medicaid, Medicare, Maternal and Child Health Programs capital expenditure reviews (Section 1122) where necessary, and (5) administer a satisfactory certificate of need program. The major hurdle for the states is the development of satisfactory certificate of need laws and procedures. The federal regulations provide that the construction of a new health care facility, a capital expenditure of $150,000 or more, a change in bed capacity by ten percent or by more than ten beds, or the offering of a new service, requires a certiticate of need review. The regulations also mandate the procedures for the review such as specific time limits, public hearings, and the appeals process. It should be noted that the requirements for “satisfactory” certificate of need programs are constantly modified. For example, HEW issued a regulation on April 25, 1979, requiring changes in certificate of need coverage for computed tomographic (CAT) scanning devices. The SHPDAs which have the authority were required to change the certificate of need regulations by October 25, 1979. For those states in which the legislature must act to execute the changes, they are required to change the regulations “within six months after the end of the earliest legislative session. . .” (Rorrie, 1979: 3). Thus, the definition of “satisfactory” is not fixed but in constant flux. In the case of the state agencies, the funding is also tied to the designation process. States are required to reach full designation in a thirty-six month period. Those which fail to attain full designation lose federal funds for health planning. Any state which is not fully designated by September 1980 loses 25 percent of funds from the Public Health Service Act, the Mental Retardation Facilities and Community Mental Health Centers Construction Act, and the Alcohol Abuse and Alcoholism Prevention Treatment and Rehabilitation Act funds in the first year of noncompliance, 50 percent of the funds in the second year of noncompliance, 75 percent of the funds in the third year of noncompliance, and 100 percent of the- funds in the fourth year of noncompliance. Although the federal government appears to have the legal mechanisms necessary to direct and control the health planning process, we can observe from the developing patterns discussed below that the relationship is not one of the superior commanding the subordinate. 2. Functional Fiefdom Model: The Massachusetts Case The experience of Massachusetts health planning illustrates efforts to circumvent the health planning process and the eventual power of the functional fiefdom to resist that circumvention. A functional fiefdom narrow purpose agencies which are not consists of self-perpetuating, responsible to locally elected officials with counterparts in state government and in the federal bureau. They are professional bureaucracies which create
156 and reinforce cozy relationships with supportive interest groups. It should be added that the local agencies of the functional fiefdoms develop mutually supportive relationships with their counterparts in the state and national governments. The Massachusetts certificate of need law requires that health facilities which wish to spend substantial capital expenditures (over $150,000) in construction, modification or expansion of their facilities, or to substantially change their services, must demonstrate a need for these changes. The application for the certificate, which includes a description of the scope and nature of the project, an estimate of the expenditures, an account of the financing methods, the specification of the target population, an environmental impact statement and a demonstration of the necessity for local health needs, is reviewed by the regional Health Systems Agency. Then, it is forwarded with recommendations to a nine member Public Health Council which grants or denies the certificate of need. Those who were opposed to specific certificate of need decisions introduced bills in the state legislature to exempt their pet projects from the process. There were two exemption bills in 1973, three in 1976, nine in 1977, and eleven in 1978. Seven were enacted over Governors Sargent’s and Dukakis’ vetoes; one was signed by Governor Dukakis under a court order. Strong local mobilization combined with a politically weak administrative structure produced the conditions for extensive logrolling on the legislative exemptions to the certificate of need law (Monypenny, et al., 1979). On August 8, 1979, Massachusetts State Senator Edward Burke argued that the passage of Senate Bill No. 463, which would force the Department of Public Health to grant a certificate of need to the Bessie M. Burke Hospital, would produce a “completely farcical” certificate of need law (State House News Service, 1979). The 1979 Burke Hospital bill was not the first attempt by that hospital to circumvent the health planning process. After a certificate of need denial in 1973, Burke supporters introduced an exemption bill which was unanimously passed by the legislature, vetoed by Governor Sargent, overridden by the legislature, and held constitutional by the Supreme Judicial Court. Finally, the coerced Department of Public Health issued the certificate of need for the renovation of Burke Hospital. But, before the completion of renovations, Medicare and Medicaid decertification forced the hospital to close in 1976. In January 1977, Lawrence City voters passed a referendum to renovate and convert the hospital into a nursing home. This significant modification of purpose required a new certificate of need. And again, another bill to exempt Burke Hospital from the certificate of need process was introduced in the 1977 legislative session. That bill failed to pass (Monypenny, et al., 1979). The Senate Bill which drew Senator Burke’s wrath was a reintroduction
157 of the 1977 Burke Hospital exemption bill which resulted from the hospital’s refusal to utilize the certificate of need process. In support of the bill, Senator William Wall indicated that the Burke Hospital did not utilize the process because the health planners would deny the application due to a lack of need! He further stated that Governor Edward King promised in his campaign to sign the Burke exemption bill (State House News Service, 1979). The Burke bill was not the only exemption introduced in the 1979 legislative session. There were sixteen different bills (although the goals of several bills overlap): two ordered the Department of Public Health to issue certificates for CAT scanners; three ordered certificates for the conversion of hospital beds to a new category; two ordered certificates for nursing homes; three ordered certificates for renal dialysis units; three ordered certificates for the operation of satellite clinics; and one ordered an increase in the number of beds (Massachusetts Office of State Health Planning, 1979). There is little wonder why Senator Burke, chairman of the Health Care Committee, expressed frustration. In the debate on St. Elizabeth’s Hospital exemption bill for a CAT scanner, he said, “We cannot make determination of whether these plans got a fair shakedown at the Public Health Council.” In regard to a nursing home whose owner contributed to the Governor’s campaign, he exclaimed, “This bill is a disgrace. It represents the low point in the nine years I’ve been in the Senate. Has the Senate become a hock shop for favors?” (State House News Service, 1979). It was clear to supporters of health planning that the trickle of exemptions was rapidly becoming a flood. They also knew that the courts would not provide relief. In 1975, the Massachusetts Supreme Judicial Court ruled that exemptions to the certificate of need law violated neither the State Constitution, the Fourteenth Amendment of the U.S. Constitution, nor the doctrine of separation of powers. Further, the Court observed: The Legislature has power, exemplified many times, to enact special or private laws, here meaning, very roughly, legislation addressed to a particular situation, that does not establish a rule of future conduct with any substantial degree of generality, and may provide ad hoc benefits of some kind for an individual or a number of them. . . It is not for us to indicate a judgment as to whether a course such as that taken by the Legislature in the 1973 statutes is merely a conspicuous invitation to logrolling or, on the contrary, an understandable and even necessary means of introducing an occasional equity into a general statutory scheme (Commissioner of Public Health v. Bessie M. Burke Hospital).
With the flood of exemptions, with an arduous struggle in the legislature, with the likely potential of overridden gubernatorial vetoes, and without judicial relief, the supporters of health planning developed a fresh strategy with a dual thrust against the massive onslaught. They encouraged the
158 Secretary of HEW to refuse to fully designate Massachusetts on the grounds that there was no single agency solely responsible for the certificate of need process, and the legislative exemptions created unneeded services. The second thrust was to communicate widely the possibility of the cut-off of federal funds due to the State’s failure to administer a satisfactory certificate of need process. This strategy was not the primary line of defense during the administrations of Governors Sargent and Dukakis because they, as strong supporters of the process, continually vetoed the exemption bills. The primary line of defense was lost with the inauguration of Governor Edward King in January 1979. He accepted campaign. contributions from individuals associated with hospital and nursing home interests. For example, Dr. William Shea of New England Baptist Hospital wrote to his fellow staff members requesting contributions to King’s campaign. He stated: He (Kirig) has assured us, in private conversation, that he is sympathetic with the Baptist case. He does not wish to encourage us to submit further legislation through the Statehouse, but feels our certificate will get fair handling (if we can show just cause) by a new administration in health care. We would like to solicit your contribution of $100 or more for this cause Ukdcshire Eagle, 1978).
The primary line of defense was also lost because Governor King holds a clearly anti-regulatory ideology. In his inaugural address, he proclaimed, “It is time to eliminate unnecessary regulation - not only that which is obsolete but that which serves no public purpose. . . And even when regulation is both wise and necessary, the process of compliance can become a monstrosity. . .” (Massachusetts Hospital Association, 1979a: 2). Although the current governor has an anti-regulatory ideology, he. might be unable to follow his ideological predilections due to his “cage of pressures.” The crucial variable in the degree of pressure was the strategy of health planning supporters to build a strong functional fiefdom with the federal government. Both publicly and privately, the federal government tightened the pressure. John Bean, regional director of Department of Health, Education and Welfare, indicated that an override of the governor’s veto of the Ludlow dialysis exemption bill would occasion a loss of federal funds. “The federal government has almost an obligation to take action” (Transcript, 1979). Five exemption bills, the Hale Hospital, the Cardinal Cushing Hospital, the St. Elizabeth’s Hospital, the Ludlow dialysis unit, and the Warner Nursing Home, passed the Legislature. The governor needed to choose between ideology and approximately $100 million in grants and loans for the next year, or he had to devise a strategy to retain both the money and ideological purity. In the first step, he vetoed the Ludlow dialysis exemption because the backers had never requested a certificate of need. Although the Senate overrode the veto, the House did not act.
159 In a crafty move, the governor convinced the Senate to recall the four other bills. Apparently, the Warner Nursing Home bill was recalled without promises of further action. The governor, however, requested a recall of the Cardinal Cushing Hospital, the St. Elizabeth’s Hospital, and the Hale Hospital exemption bills until there was time for reconsideration by the Public Health Council (Boston Globe, 1979a). In a private meeting with the Public Health Council, the governor requested reconsideration of those certificates of need. The participants have different views of the meeting. Some indicated a great deal of political pressure. Public Health Council member James Hooley said, “It’s fair to say that reconsideration never would have been an issue if there had been no meeting with the governor” (Boston Globe, 1979a). Another council member said, “We were told the governor was inclined to sign the bills, and we were asked if we would reconsider. Quite clearly, he was under a lot of pressure and was saying ‘help’ ” (Boston Globe, 1979a). Others indicated that the major reason for reconsideration embraced the public interest. There were “enough grounds on which to reconsider” (Massachusetts Hospital Association, 1979b). The Public Health Commissioner said that the governor did not make an ultimatum. Fortunately for the governor, in the meantime, the terms of two Public Health Council members expired. Then the governor appointed the wife of the state representative who introduced the St. Elizabeth’s exemption bill and a radiologist to the Public Health Council. Although the Department of Public Health staff recommended rejection of the certificate of need again (Boston Globe, 1979a), on September 25, the Public Health Council voted five to three to grant one to Cardinal Cushing Hospital (Massachusetts Hospital Association, 1979~). In the October meeting they reversed the earlier decision to deny a certificate to the Hale Hospital. And in November, the Public Health Council denied, for the second time, a certificate of need for St. Elizabeth’s CAT scanner. The pressures on the governor tightened again. Approval of the bill which authorized a certificate of need for a $36 1,000 expenditure risked the loss of $100 million. For the first time, the Massachusetts Hospital Association repudiated the efforts of hospitals to gain legislative exemptions. And then William Skemy, the administrator of St. Elizabeth’s, provided slack for the governor. He requested a veto because “the hospital was worried that it would be blamed by dozens of other hospitals and health care agencies if the governor signed the bill and the federal government acted on its threat to cut back. . .” (Bosfon Globe, 1979b). Prior to 1979, those wishing to upset the decisions of the Massachusetts health planning process turned to the legislature for redress. The strategy of health planning supporters to expand the conflict to include the power of
160 HEW to deny funds to the State appears to have blocked the flood of exemptions. After a period of anarchical noncompliance with the law, the functional fiefdom, whose parts are held together by common interests, was able to regain control. The functional fiefdom was able to control its arena of interest and expertise from outside attack. In addition to horizontal control, the functional fiefdom is characterized by self-perpetuating, narrow purpose agencies which are not responsible to locally elected officials. Certainly, the health planning structure has many of these characteristics. Their purpose is very narrow; they are planning only for health and are even constricted within that realm. For example, they do not plan for federal health facilities. Further, although coordination is required, many health agencies such as the Professional Service Review Organizations are separate from and independent of the health planning process. Thus, the health planning structure has a fairly narrow range of responsibility. In most of the country, the Health Systems Agencies (the regional health planning agencies) exemplify the self-perpetuating characteristic. One hundred and twenty-two of the 205 HSAs developed from the former Comprehensive Health Planning Agencies, the former Regional Medical Programs, and other Public Health Act programs (U.S., DHEW, 1978). Thus, in general, the former agencies modified and perpetuated themselves under the new law. A third characteristic of the functional fiefdom is that it is not responsible to locally elected officials. This clearly applies to health planning. One public official wrote to a state legislator the following: Both the provisions of the Act and HEW’s proposed implementation of it are particularly ious for their violation of both constitutionally established governmental relationships democratic principle that public officials should be responsible and accountable to the they serve. ‘The major thrust of the Act is to give priunte organizations important public
obnoxand our citizens powers.
The 1979 Amendments require representation of general purpose local government officials. This will probably cause only a slight modification in the power of the functional fiefdom. The last characteristic of a functional fiefdom is that the members of the horizontal (across the governmental levels) fiefdom unite to defend against attacks. The strategy of the supporters of health planning in Massachusetts, as described earlier, illustrates this characteristic. The planning system was under attack in the legislature, so the members of the state and regional segment of the fiefdom fought every exemption and spurred the third segment of the fiefdom, the federal agency, into the battle. Although the functional fiefdom model is supported by a good deal of evidence, there are two other major trends which must be examined.
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3. Poverty Program Model A second trend, which has some of the elements of the first, corresponds to developments in the poverty program. The ‘poverty program was characterized by direct relationships between Washington and the local community action programs with a very limited role for the states. In general, nongovernmental actors controlled the community action programs. At a later stage, the power of local public officials was increased by the Green Amendments to the Economic Opportunity Act. In the discussion of the functional fiefdoms, I have commented upon two aspects of this: the lack of control by local politicians and the role of nongovernmental actors. The other major element was the lack of an important role for the states in the program. Soon after the initial passage of the Health Planning Act, the National Governors’ Association argued that “the federal law established a chain of accountability which is. . . separate from the existing constitutional authority of state and local governments. In essence, the statute established a network of local planning agencies funded by, and accountable to, the Secretary of HEW” (U.S. Senate, 1978). Later, Governor J. Joseph Garrahy of Rhode Island testified, “A local health planning agency which views itself as an outpost of the sponsoring federal agency is less effective than an agency which considers itself an integral part of the state health policymaking system in which it must operate” (U.S. Senate, 1978). Not only the governors, but also the National Conference of State Legislators, were concerned by the lack of “a strong state role at the center of the health planning program” (U.S. House, 1979). Although state officials complained about the limited role for the states, this is far different from the structure of the poverty program. The role of the states in the poverty program was limited mainly to the power of veto over local programs which were funded by the federal government. In contrast, the role of the states in health planning is extensive: they establish a state health plan; review all health grants; perform 1122 reviews; and most of all, they have the final authority in the certificate of need process. Since the certificate of need process provides the regulatory clout in the health planning system, the states have the critical power and a crucial role in the process. Additionally, the 1979 amendments to the National Health Planning Act strengthened the role of state government. The amendments transfer to the governor the power to appoint the chairperson of the State Health Coordinating Council, to alter HSA boundaries, and to approve or disapprove the State Health Plan. The approved State Health Plan forms the rationale for certificate of need decisions. Further, the state determines the statewide health needs to which the regional Health Systems Plans must be responsive.
162 Thus, although the health planning structure exhibits two characteristics of the poverty program model (lack of control by local politicians and the large role of nongovernmental actors), it does not exhibit the critical one, the lack of an important state role. 4. Individualis tic Model The last trend appears to be an individualistic one with every agency fending for itself. The alliances of and conflicts between governmental levels depend upon the situation. Three examples illustrate this trend. In the first, the regional Health Systems Agency and the federal government formed an alliance against the state agency. The Miami Valley Health Systems Agency disapproved projects for the Kettering Medical Center and St. Elizabeth’s Hospital. The Ohio Department of Health approved the projects. After a review of the decision, Henry Foley, Administrator of the Health Resources Administration, threatened the Ohio Department of Health with the possible denial of designation as the State Health Planning Agency. He wrote: One of the functions required of a State Health Planning and Development Agency before it may reach full designation is the administration of a certificate of need program which prevents the offering or development of unneeded facilities and services. The experience of the State in administering the section 1122 program wiU certainly be a major factor in the Secretary’s determination as to the capability of the Ohio Department of Health to administer a certificate of need program which meets the requirements of the law (U.S. House, 1978).
This strong threat was “leaked” to the Dayton Daily News and Blue Cross of Southwest Ohio before the Director of the Ohio Department of Health received the letter. Further, there seems to have been no attempt to discuss the matter before the formal letter. John Ackerman, Director of the Ohio Department of Health, wrote to Secretary Joseph Califano that “It is difficult enough to carry out our capital expenditures reviews without harassment and dirty tricks from HEW” (U.S. House, 1978). The Ohio State Medical Association argued: If health planning is to succeed, it must be carried on in a spirit of cooperation, open and above board. It must be approached with a reasonable attitude, and it must involve all interests equally. We here in Ohio abide by these principles. We expect the Department of Health, Education and Welfare to do the same (U.S. House, 1978).
This Ohio case is an example of one temporary alliance of the federal government and the regional agency, and another of the state government and a medical society. A second example of this individualism is a regional agency in conflict with an alliance of the federal and state agencies. In one subarea council
163
meeting, the director of planning for the region explained that both the federal and state governments require the HSA to “make rational decisions in a sea of political resources.” Conflict occurs because the HSA must satisfy two different masters, i.e., the “rational” as required by the state and federal agencies, and the political. The regional agency has neither the time, the resources nor the will to satisfy both masters. Thus, the HSA attacks important regional problems and “minimally” complies with federal and state requirements in order to receive funds. Further, the planning director asked the subarea council to “stand behind the HSA in negotiations and conflicts with the state and federal governments.” The political resources of the region must be mobilized against the other governments. The last example of the individualistic trend is a case of no alliances between the health planning agencies. The Oklahoma Health Systems Agency rejected a $100 million construction plan of Oral Roberts’ City of Faith Medical Center because Tulsa needs fewer, not more, acute care beds. The state planning agency, however, approved the project. Frances Dearman, an HEW official, said, “If the state approves it under the state law, there’s nothing we can do about it” (Congressional Quarterly, 1979). The HSA was left without support from the other levels. It gained a local constituency and the Tulsa Hospital Council filed suit against the construction and won in the state district court. Thus the alliances seem to vary with the situation. 5. Discussion The current relationship of governmental units in health planning is an extremely turbulent, unsettled one. The, game is especially dazzling; the spectators cannot tell which team the players are on; they change sides after each play and sometimes during the play; and, most importantly, the field of play switches turf rapidly. This situation is caused by the difficulties of any new relationship: the ground rules and roles are wobbly; the glue of trust has not firmed; and new information or clarifications of old information are constantly introduced. The “settling down” in the relationships has not yet occurred. Although the final pattern is difficult to predict, there are several elements which will certainly influence the pattern. The first important element is the development and level of trust between the major actors. If one level of government develops trust with the major interest groups, it will be better able to impose its will on the other levels. If the three levels of government develop strong bonds of trust among themselves, we will observe the development of a monopolistic functional fiefdom. The development of trust depends upon two further elements. The first is the control of political power in the health planning process. If the planning process is a pluralistic
164 arena in which the major interest groups negotiate to produce policy decisions, then the conflict may be contained within the process. If each level of government is captured by a different interest group, then conflict between them is assured. If all levels are captured by one group (some suggest the group it regulates), then we will have control by a monopolistic fiefdom. Trust also depends upon the character of the outcomes. Outcomes at one governmental level which threaten the existence of a group are likely to produce conflict between levels; negotiated outcomes are likely to produce cooperation between levels. A further element in the development of intergovernmental relations is the culture and politics of the state. States with a more unified culture, strong state parties, and cohesive state congressional delegations are likely to retain more control over health planning than states with the opposite characteristics. And finally, the pattern depends upon the resource dependence of the state, and the amount of potential substitutable resources for those that might be terminated. Acknowledgments I wish to thank Stephen Schechter, Linda Wilkins and Alfred Mauet for their most helpful comments, and Williams College for a Division II Grant. Several people quoted in this paper are not identified in order to preserve confidentiality. References Berkshire EugZe (1978). “Hospital Staff Urge Aid to King Campaign,” Pittsfield, MA, October 23. Boston Globe (1979a). “Health Planners Attack King Request,” September 9. Boston Globe (1979b). “King Vetoes Brighton Hospital’s Scanner Bill,” November 16. Cain, Harry (1978a). “DHEW Program Policy Notice 78-12,” Hyattsville, MD:HEW. Cain, Harry (1978b). MMDHEW Program Policy Notice 7820,” Hyattsville, MD:HEW. Commissioner of Public Health v. Be&e M. Burke Memorial Hospital (1975). Massachusetts, 323 N.E. 2d 309. Congressional Quarterly (1979). “Weekly Report,” March 24, 1979: 522-23. Washington, DC.: Congressional Quarterly. Massachusetts Hospital Association (1979a). “Monday Report,” Vol. VII, No. 31. Massachusetts Hospital Association (1979b). “Monday Report,” Vol. VII, No. 36. Massachusetts Hospital Association (1979c). “Monday Report,” Vol. VII, No. 40. Massachusetts Office of State Health Planning (1979). “Health Reports,” Vol. V, No. 6. Monypenny, Phillip, Colby, David and Baker, David (1979). “Legislative Interference in Certificate of Need Decisions: A Study in the Politics of Federalism and Planning.” (mimeo). Williamstown, MA. Rorrie, Colin (1979). “DHEW Program Police Notice 79-10,” Hyattsville, MD:HEW. State House News Service (1979). No Title:Report on August 8, 1979 (mimeo), Boston, MA. Transcript (1979). “Generosity to Hospitals May Reduce Aid to State,” North Adams, MA, October 18. U.S.DHEW (1978). Current Developments in the National Health Planning Program, Washington, D.C.: G.P.O.
165 U.S. House of Representatives (1978). Hearings on Health Planning and Resource Development Amendments of 19 78. Washington, D.C.:G.P.O. U.S. House of Representatives (1979). Hearings on Health Planning and Resource Development Amendments of 1979. Washington, D.C.:G.P.O. U.S. Senate (1978). Hearings on Health PlanningAmendments of 1978. Washington, D.C.:G.P.O.
FUNCTIONAL DEVELOPMENT
153
FIEFDOM, POVERTY MODEL OR INDIVIDUALISM? OF INTERGOVERNMENTAL RELATIONS IN HEALTH PLANNING DAVID C. COLBY
Institute of Government
and Public Affairs, University of Illinois, Urbana, IL 61801,
U.S.A.
ABSTRACT The United States national government has the power under the National Health Planning and Development Act of 1974 to establish and exercise legal control over a system of Health System Agencies, State Health Planning and Development Agencies, and State Health Coordinating Councils. Although the national government appears to have the legal powers necessary to direct and control the health planning process, a federal system has difficulties in the implementation of planning which has centralized goals or direction. The states and regions have the potential power to weaken the strength of the national government. Three trends in the developing relationship between the national, state, and regional units in health planning are discussed. The first, the functional fiefdom, consists of self-perpetuating, narrow purpose agencies which are not responsible to local or state-wide elected officials. These are professional bureaucracies which create and reinforce cozy relationships with supportive interest groups. The second trend, the poverty model, includes the lack of control by local elected officials, a large role to nongovernmental actors, and a direct relationship between Washington and the regional planning agencies. The last trend appears to be an individualistic one with every unit fending for itself. A case study of Massachusetts along with supplemental materials from other states is presented to illustrate the trends.
1. National
Health Planning
Hale Champion, Undersecretary of the Department of Health, Education and Welfare, indicated that the National Health Planning Act “. . . relies on a kind of atomic bomb theory of penalty. . .” (U.S. House, 1979: 108). The analogy assumes that intergovernmental relations in this area develop with an overwhelming superior power at the top which forces the subordinate units to behave contrary to their own desires or interests. This is certainly not the case. At the most, there is a centripetal force pulling a tangled web of specialized governmental and nongovernmental agencies. This paper examines the developing patterns and speculates on the future trends of intergovernmental relations in health planning. Three trends, the functional fiefdom, the poverty program, and the individualistic, are identified. A case study on Massachusetts along with supplemental materials from other states is presented to illustrate the trends. The parameters of these intergovernmental relations are fixed by the
0165-2281/81/0000-0000/$02.50
0 1981 Elsevier Scientific Publishing Company
154 National Health Planning and Development Act of 1974, whose purpose is to support high quality health care, to create equal access to health care, and, most importantly, to control the rapidly rising costs of health care. In order to accomplish these goals, a system of regional Health Systems Agencies (HSAs), State Health Planning and Development Agencies (SHPDAs), and State Health Coordinating Councils (SHCCs) was established. The 205 Health Systems Agencies develop health plans, periodically review all health services, review and approve or disapprove applications for federal health funds, and, after the passage of state certificate of need laws, review all substantial expansions of, or modifications in, non-federal health facilities. This national law further requires that State Health Planning and Development Agencies perform the staff functions for the State Health Coordinating Councils which are the citizen decision-making bodies for state health planning. These state and regional agencies will develop Health Systems Plans, Annual Implementation-Plans, and State Health Plans, all of which elaborate the criteria for decisions such as those on certificates of need. The Department of Health, Education and Welfare exercises legal control over these various health planning agencies through the funding and designation processes. In the designation process, an organization is selected to be the HSA. Then, the selected agency is conditionally designated. In order to meet requirements for full designation, an HSA must (1) develop a Health Systems Plan and an Annual Implementation Plan, (2) collect and analyze health data, (3) coordinate activities with appropriate agencies, and (4) review the need for new health facilities (Cain, 1978a: Attachment). When an HSA is capable of executing all these functions, it is fully designated by the Secretary of HEW. This full designation is required within 24 months after the conditional designation. The law, however, provides that HEW can extend a conditional agreement up to one year in order to “enable the agency to qualify for full designation,” if there are “unusual circumstances” (Cain, 1978b: 1). HEW must review the designation status every three years. A fully designated agency which executes appropriately its functions would be continued in that designation. A conditionally designated agency may be fully designated, continued in conditional status, or terminated depending upon its performance. The funding level of the HSA is tied to its designation status. The fully designated HSA is fully funded on a per capita basis; the conditionally designated HSA is funded at a level which reflects its development. The State Health Planning and Development Agencies (SHPDAs) are also required to proceed through a designation process. For full designation, the state must (1) establish a SHPDA with the authority to implement health planning, (2) organize a State Health Coordinating Council which reviews all
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plans and budgets, (3) develop a state health plan, (4) perform Medicaid, Medicare, Maternal and Child Health Programs capital expenditure reviews (Section 1122) where necessary, and (5) administer a satisfactory certificate of need program. The major hurdle for the states is the development of satisfactory certificate of need laws and procedures. The federal regulations provide that the construction of a new health care facility, a capital expenditure of $150,000 or more, a change in bed capacity by ten percent or by more than ten beds, or the offering of a new service, requires a certiticate of need review. The regulations also mandate the procedures for the review such as specific time limits, public hearings, and the appeals process. It should be noted that the requirements for “satisfactory” certificate of need programs are constantly modified. For example, HEW issued a regulation on April 25, 1979, requiring changes in certificate of need coverage for computed tomographic (CAT) scanning devices. The SHPDAs which have the authority were required to change the certificate of need regulations by October 25, 1979. For those states in which the legislature must act to execute the changes, they are required to change the regulations “within six months after the end of the earliest legislative session. . .” (Rorrie, 1979: 3). Thus, the definition of “satisfactory” is not fixed but in constant flux. In the case of the state agencies, the funding is also tied to the designation process. States are required to reach full designation in a thirty-six month period. Those which fail to attain full designation lose federal funds for health planning. Any state which is not fully designated by September 1980 loses 25 percent of funds from the Public Health Service Act, the Mental Retardation Facilities and Community Mental Health Centers Construction Act, and the Alcohol Abuse and Alcoholism Prevention Treatment and Rehabilitation Act funds in the first year of noncompliance, 50 percent of the funds in the second year of noncompliance, 75 percent of the funds in the third year of noncompliance, and 100 percent of the- funds in the fourth year of noncompliance. Although the federal government appears to have the legal mechanisms necessary to direct and control the health planning process, we can observe from the developing patterns discussed below that the relationship is not one of the superior commanding the subordinate. 2. Functional Fiefdom Model: The Massachusetts Case The experience of Massachusetts health planning illustrates efforts to circumvent the health planning process and the eventual power of the functional fiefdom to resist that circumvention. A functional fiefdom narrow purpose agencies which are not consists of self-perpetuating, responsible to locally elected officials with counterparts in state government and in the federal bureau. They are professional bureaucracies which create
156 and reinforce cozy relationships with supportive interest groups. It should be added that the local agencies of the functional fiefdoms develop mutually supportive relationships with their counterparts in the state and national governments. The Massachusetts certificate of need law requires that health facilities which wish to spend substantial capital expenditures (over $150,000) in construction, modification or expansion of their facilities, or to substantially change their services, must demonstrate a need for these changes. The application for the certificate, which includes a description of the scope and nature of the project, an estimate of the expenditures, an account of the financing methods, the specification of the target population, an environmental impact statement and a demonstration of the necessity for local health needs, is reviewed by the regional Health Systems Agency. Then, it is forwarded with recommendations to a nine member Public Health Council which grants or denies the certificate of need. Those who were opposed to specific certificate of need decisions introduced bills in the state legislature to exempt their pet projects from the process. There were two exemption bills in 1973, three in 1976, nine in 1977, and eleven in 1978. Seven were enacted over Governors Sargent’s and Dukakis’ vetoes; one was signed by Governor Dukakis under a court order. Strong local mobilization combined with a politically weak administrative structure produced the conditions for extensive logrolling on the legislative exemptions to the certificate of need law (Monypenny, et al., 1979). On August 8, 1979, Massachusetts State Senator Edward Burke argued that the passage of Senate Bill No. 463, which would force the Department of Public Health to grant a certificate of need to the Bessie M. Burke Hospital, would produce a “completely farcical” certificate of need law (State House News Service, 1979). The 1979 Burke Hospital bill was not the first attempt by that hospital to circumvent the health planning process. After a certificate of need denial in 1973, Burke supporters introduced an exemption bill which was unanimously passed by the legislature, vetoed by Governor Sargent, overridden by the legislature, and held constitutional by the Supreme Judicial Court. Finally, the coerced Department of Public Health issued the certificate of need for the renovation of Burke Hospital. But, before the completion of renovations, Medicare and Medicaid decertification forced the hospital to close in 1976. In January 1977, Lawrence City voters passed a referendum to renovate and convert the hospital into a nursing home. This significant modification of purpose required a new certificate of need. And again, another bill to exempt Burke Hospital from the certificate of need process was introduced in the 1977 legislative session. That bill failed to pass (Monypenny, et al., 1979). The Senate Bill which drew Senator Burke’s wrath was a reintroduction
157 of the 1977 Burke Hospital exemption bill which resulted from the hospital’s refusal to utilize the certificate of need process. In support of the bill, Senator William Wall indicated that the Burke Hospital did not utilize the process because the health planners would deny the application due to a lack of need! He further stated that Governor Edward King promised in his campaign to sign the Burke exemption bill (State House News Service, 1979). The Burke bill was not the only exemption introduced in the 1979 legislative session. There were sixteen different bills (although the goals of several bills overlap): two ordered the Department of Public Health to issue certificates for CAT scanners; three ordered certificates for the conversion of hospital beds to a new category; two ordered certificates for nursing homes; three ordered certificates for renal dialysis units; three ordered certificates for the operation of satellite clinics; and one ordered an increase in the number of beds (Massachusetts Office of State Health Planning, 1979). There is little wonder why Senator Burke, chairman of the Health Care Committee, expressed frustration. In the debate on St. Elizabeth’s Hospital exemption bill for a CAT scanner, he said, “We cannot make determination of whether these plans got a fair shakedown at the Public Health Council.” In regard to a nursing home whose owner contributed to the Governor’s campaign, he exclaimed, “This bill is a disgrace. It represents the low point in the nine years I’ve been in the Senate. Has the Senate become a hock shop for favors?” (State House News Service, 1979). It was clear to supporters of health planning that the trickle of exemptions was rapidly becoming a flood. They also knew that the courts would not provide relief. In 1975, the Massachusetts Supreme Judicial Court ruled that exemptions to the certificate of need law violated neither the State Constitution, the Fourteenth Amendment of the U.S. Constitution, nor the doctrine of separation of powers. Further, the Court observed: The Legislature has power, exemplified many times, to enact special or private laws, here meaning, very roughly, legislation addressed to a particular situation, that does not establish a rule of future conduct with any substantial degree of generality, and may provide ad hoc benefits of some kind for an individual or a number of them. . . It is not for us to indicate a judgment as to whether a course such as that taken by the Legislature in the 1973 statutes is merely a conspicuous invitation to logrolling or, on the contrary, an understandable and even necessary means of introducing an occasional equity into a general statutory scheme (Commissioner of Public Health v. Bessie M. Burke Hospital).
With the flood of exemptions, with an arduous struggle in the legislature, with the likely potential of overridden gubernatorial vetoes, and without judicial relief, the supporters of health planning developed a fresh strategy with a dual thrust against the massive onslaught. They encouraged the
158 Secretary of HEW to refuse to fully designate Massachusetts on the grounds that there was no single agency solely responsible for the certificate of need process, and the legislative exemptions created unneeded services. The second thrust was to communicate widely the possibility of the cut-off of federal funds due to the State’s failure to administer a satisfactory certificate of need process. This strategy was not the primary line of defense during the administrations of Governors Sargent and Dukakis because they, as strong supporters of the process, continually vetoed the exemption bills. The primary line of defense was lost with the inauguration of Governor Edward King in January 1979. He accepted campaign. contributions from individuals associated with hospital and nursing home interests. For example, Dr. William Shea of New England Baptist Hospital wrote to his fellow staff members requesting contributions to King’s campaign. He stated: He (Kirig) has assured us, in private conversation, that he is sympathetic with the Baptist case. He does not wish to encourage us to submit further legislation through the Statehouse, but feels our certificate will get fair handling (if we can show just cause) by a new administration in health care. We would like to solicit your contribution of $100 or more for this cause Ukdcshire Eagle, 1978).
The primary line of defense was also lost because Governor King holds a clearly anti-regulatory ideology. In his inaugural address, he proclaimed, “It is time to eliminate unnecessary regulation - not only that which is obsolete but that which serves no public purpose. . . And even when regulation is both wise and necessary, the process of compliance can become a monstrosity. . .” (Massachusetts Hospital Association, 1979a: 2). Although the current governor has an anti-regulatory ideology, he. might be unable to follow his ideological predilections due to his “cage of pressures.” The crucial variable in the degree of pressure was the strategy of health planning supporters to build a strong functional fiefdom with the federal government. Both publicly and privately, the federal government tightened the pressure. John Bean, regional director of Department of Health, Education and Welfare, indicated that an override of the governor’s veto of the Ludlow dialysis exemption bill would occasion a loss of federal funds. “The federal government has almost an obligation to take action” (Transcript, 1979). Five exemption bills, the Hale Hospital, the Cardinal Cushing Hospital, the St. Elizabeth’s Hospital, the Ludlow dialysis unit, and the Warner Nursing Home, passed the Legislature. The governor needed to choose between ideology and approximately $100 million in grants and loans for the next year, or he had to devise a strategy to retain both the money and ideological purity. In the first step, he vetoed the Ludlow dialysis exemption because the backers had never requested a certificate of need. Although the Senate overrode the veto, the House did not act.
159 In a crafty move, the governor convinced the Senate to recall the four other bills. Apparently, the Warner Nursing Home bill was recalled without promises of further action. The governor, however, requested a recall of the Cardinal Cushing Hospital, the St. Elizabeth’s Hospital, and the Hale Hospital exemption bills until there was time for reconsideration by the Public Health Council (Boston Globe, 1979a). In a private meeting with the Public Health Council, the governor requested reconsideration of those certificates of need. The participants have different views of the meeting. Some indicated a great deal of political pressure. Public Health Council member James Hooley said, “It’s fair to say that reconsideration never would have been an issue if there had been no meeting with the governor” (Boston Globe, 1979a). Another council member said, “We were told the governor was inclined to sign the bills, and we were asked if we would reconsider. Quite clearly, he was under a lot of pressure and was saying ‘help’ ” (Boston Globe, 1979a). Others indicated that the major reason for reconsideration embraced the public interest. There were “enough grounds on which to reconsider” (Massachusetts Hospital Association, 1979b). The Public Health Commissioner said that the governor did not make an ultimatum. Fortunately for the governor, in the meantime, the terms of two Public Health Council members expired. Then the governor appointed the wife of the state representative who introduced the St. Elizabeth’s exemption bill and a radiologist to the Public Health Council. Although the Department of Public Health staff recommended rejection of the certificate of need again (Boston Globe, 1979a), on September 25, the Public Health Council voted five to three to grant one to Cardinal Cushing Hospital (Massachusetts Hospital Association, 1979~). In the October meeting they reversed the earlier decision to deny a certificate to the Hale Hospital. And in November, the Public Health Council denied, for the second time, a certificate of need for St. Elizabeth’s CAT scanner. The pressures on the governor tightened again. Approval of the bill which authorized a certificate of need for a $36 1,000 expenditure risked the loss of $100 million. For the first time, the Massachusetts Hospital Association repudiated the efforts of hospitals to gain legislative exemptions. And then William Skemy, the administrator of St. Elizabeth’s, provided slack for the governor. He requested a veto because “the hospital was worried that it would be blamed by dozens of other hospitals and health care agencies if the governor signed the bill and the federal government acted on its threat to cut back. . .” (Bosfon Globe, 1979b). Prior to 1979, those wishing to upset the decisions of the Massachusetts health planning process turned to the legislature for redress. The strategy of health planning supporters to expand the conflict to include the power of
160 HEW to deny funds to the State appears to have blocked the flood of exemptions. After a period of anarchical noncompliance with the law, the functional fiefdom, whose parts are held together by common interests, was able to regain control. The functional fiefdom was able to control its arena of interest and expertise from outside attack. In addition to horizontal control, the functional fiefdom is characterized by self-perpetuating, narrow purpose agencies which are not responsible to locally elected officials. Certainly, the health planning structure has many of these characteristics. Their purpose is very narrow; they are planning only for health and are even constricted within that realm. For example, they do not plan for federal health facilities. Further, although coordination is required, many health agencies such as the Professional Service Review Organizations are separate from and independent of the health planning process. Thus, the health planning structure has a fairly narrow range of responsibility. In most of the country, the Health Systems Agencies (the regional health planning agencies) exemplify the self-perpetuating characteristic. One hundred and twenty-two of the 205 HSAs developed from the former Comprehensive Health Planning Agencies, the former Regional Medical Programs, and other Public Health Act programs (U.S., DHEW, 1978). Thus, in general, the former agencies modified and perpetuated themselves under the new law. A third characteristic of the functional fiefdom is that it is not responsible to locally elected officials. This clearly applies to health planning. One public official wrote to a state legislator the following: Both the provisions of the Act and HEW’s proposed implementation of it are particularly ious for their violation of both constitutionally established governmental relationships democratic principle that public officials should be responsible and accountable to the they serve. ‘The major thrust of the Act is to give priunte organizations important public
obnoxand our citizens powers.
The 1979 Amendments require representation of general purpose local government officials. This will probably cause only a slight modification in the power of the functional fiefdom. The last characteristic of a functional fiefdom is that the members of the horizontal (across the governmental levels) fiefdom unite to defend against attacks. The strategy of the supporters of health planning in Massachusetts, as described earlier, illustrates this characteristic. The planning system was under attack in the legislature, so the members of the state and regional segment of the fiefdom fought every exemption and spurred the third segment of the fiefdom, the federal agency, into the battle. Although the functional fiefdom model is supported by a good deal of evidence, there are two other major trends which must be examined.
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3. Poverty Program Model A second trend, which has some of the elements of the first, corresponds to developments in the poverty program. The ‘poverty program was characterized by direct relationships between Washington and the local community action programs with a very limited role for the states. In general, nongovernmental actors controlled the community action programs. At a later stage, the power of local public officials was increased by the Green Amendments to the Economic Opportunity Act. In the discussion of the functional fiefdoms, I have commented upon two aspects of this: the lack of control by local politicians and the role of nongovernmental actors. The other major element was the lack of an important role for the states in the program. Soon after the initial passage of the Health Planning Act, the National Governors’ Association argued that “the federal law established a chain of accountability which is. . . separate from the existing constitutional authority of state and local governments. In essence, the statute established a network of local planning agencies funded by, and accountable to, the Secretary of HEW” (U.S. Senate, 1978). Later, Governor J. Joseph Garrahy of Rhode Island testified, “A local health planning agency which views itself as an outpost of the sponsoring federal agency is less effective than an agency which considers itself an integral part of the state health policymaking system in which it must operate” (U.S. Senate, 1978). Not only the governors, but also the National Conference of State Legislators, were concerned by the lack of “a strong state role at the center of the health planning program” (U.S. House, 1979). Although state officials complained about the limited role for the states, this is far different from the structure of the poverty program. The role of the states in the poverty program was limited mainly to the power of veto over local programs which were funded by the federal government. In contrast, the role of the states in health planning is extensive: they establish a state health plan; review all health grants; perform 1122 reviews; and most of all, they have the final authority in the certificate of need process. Since the certificate of need process provides the regulatory clout in the health planning system, the states have the critical power and a crucial role in the process. Additionally, the 1979 amendments to the National Health Planning Act strengthened the role of state government. The amendments transfer to the governor the power to appoint the chairperson of the State Health Coordinating Council, to alter HSA boundaries, and to approve or disapprove the State Health Plan. The approved State Health Plan forms the rationale for certificate of need decisions. Further, the state determines the statewide health needs to which the regional Health Systems Plans must be responsive.
162 Thus, although the health planning structure exhibits two characteristics of the poverty program model (lack of control by local politicians and the large role of nongovernmental actors), it does not exhibit the critical one, the lack of an important state role. 4. Individualis tic Model The last trend appears to be an individualistic one with every agency fending for itself. The alliances of and conflicts between governmental levels depend upon the situation. Three examples illustrate this trend. In the first, the regional Health Systems Agency and the federal government formed an alliance against the state agency. The Miami Valley Health Systems Agency disapproved projects for the Kettering Medical Center and St. Elizabeth’s Hospital. The Ohio Department of Health approved the projects. After a review of the decision, Henry Foley, Administrator of the Health Resources Administration, threatened the Ohio Department of Health with the possible denial of designation as the State Health Planning Agency. He wrote: One of the functions required of a State Health Planning and Development Agency before it may reach full designation is the administration of a certificate of need program which prevents the offering or development of unneeded facilities and services. The experience of the State in administering the section 1122 program wiU certainly be a major factor in the Secretary’s determination as to the capability of the Ohio Department of Health to administer a certificate of need program which meets the requirements of the law (U.S. House, 1978).
This strong threat was “leaked” to the Dayton Daily News and Blue Cross of Southwest Ohio before the Director of the Ohio Department of Health received the letter. Further, there seems to have been no attempt to discuss the matter before the formal letter. John Ackerman, Director of the Ohio Department of Health, wrote to Secretary Joseph Califano that “It is difficult enough to carry out our capital expenditures reviews without harassment and dirty tricks from HEW” (U.S. House, 1978). The Ohio State Medical Association argued: If health planning is to succeed, it must be carried on in a spirit of cooperation, open and above board. It must be approached with a reasonable attitude, and it must involve all interests equally. We here in Ohio abide by these principles. We expect the Department of Health, Education and Welfare to do the same (U.S. House, 1978).
This Ohio case is an example of one temporary alliance of the federal government and the regional agency, and another of the state government and a medical society. A second example of this individualism is a regional agency in conflict with an alliance of the federal and state agencies. In one subarea council
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meeting, the director of planning for the region explained that both the federal and state governments require the HSA to “make rational decisions in a sea of political resources.” Conflict occurs because the HSA must satisfy two different masters, i.e., the “rational” as required by the state and federal agencies, and the political. The regional agency has neither the time, the resources nor the will to satisfy both masters. Thus, the HSA attacks important regional problems and “minimally” complies with federal and state requirements in order to receive funds. Further, the planning director asked the subarea council to “stand behind the HSA in negotiations and conflicts with the state and federal governments.” The political resources of the region must be mobilized against the other governments. The last example of the individualistic trend is a case of no alliances between the health planning agencies. The Oklahoma Health Systems Agency rejected a $100 million construction plan of Oral Roberts’ City of Faith Medical Center because Tulsa needs fewer, not more, acute care beds. The state planning agency, however, approved the project. Frances Dearman, an HEW official, said, “If the state approves it under the state law, there’s nothing we can do about it” (Congressional Quarterly, 1979). The HSA was left without support from the other levels. It gained a local constituency and the Tulsa Hospital Council filed suit against the construction and won in the state district court. Thus the alliances seem to vary with the situation. 5. Discussion The current relationship of governmental units in health planning is an extremely turbulent, unsettled one. The, game is especially dazzling; the spectators cannot tell which team the players are on; they change sides after each play and sometimes during the play; and, most importantly, the field of play switches turf rapidly. This situation is caused by the difficulties of any new relationship: the ground rules and roles are wobbly; the glue of trust has not firmed; and new information or clarifications of old information are constantly introduced. The “settling down” in the relationships has not yet occurred. Although the final pattern is difficult to predict, there are several elements which will certainly influence the pattern. The first important element is the development and level of trust between the major actors. If one level of government develops trust with the major interest groups, it will be better able to impose its will on the other levels. If the three levels of government develop strong bonds of trust among themselves, we will observe the development of a monopolistic functional fiefdom. The development of trust depends upon two further elements. The first is the control of political power in the health planning process. If the planning process is a pluralistic
164 arena in which the major interest groups negotiate to produce policy decisions, then the conflict may be contained within the process. If each level of government is captured by a different interest group, then conflict between them is assured. If all levels are captured by one group (some suggest the group it regulates), then we will have control by a monopolistic fiefdom. Trust also depends upon the character of the outcomes. Outcomes at one governmental level which threaten the existence of a group are likely to produce conflict between levels; negotiated outcomes are likely to produce cooperation between levels. A further element in the development of intergovernmental relations is the culture and politics of the state. States with a more unified culture, strong state parties, and cohesive state congressional delegations are likely to retain more control over health planning than states with the opposite characteristics. And finally, the pattern depends upon the resource dependence of the state, and the amount of potential substitutable resources for those that might be terminated. Acknowledgments I wish to thank Stephen Schechter, Linda Wilkins and Alfred Mauet for their most helpful comments, and Williams College for a Division II Grant. Several people quoted in this paper are not identified in order to preserve confidentiality. References Berkshire EugZe (1978). “Hospital Staff Urge Aid to King Campaign,” Pittsfield, MA, October 23. Boston Globe (1979a). “Health Planners Attack King Request,” September 9. Boston Globe (1979b). “King Vetoes Brighton Hospital’s Scanner Bill,” November 16. Cain, Harry (1978a). “DHEW Program Policy Notice 78-12,” Hyattsville, MD:HEW. Cain, Harry (1978b). MMDHEW Program Policy Notice 7820,” Hyattsville, MD:HEW. Commissioner of Public Health v. Be&e M. Burke Memorial Hospital (1975). Massachusetts, 323 N.E. 2d 309. Congressional Quarterly (1979). “Weekly Report,” March 24, 1979: 522-23. Washington, DC.: Congressional Quarterly. Massachusetts Hospital Association (1979a). “Monday Report,” Vol. VII, No. 31. Massachusetts Hospital Association (1979b). “Monday Report,” Vol. VII, No. 36. Massachusetts Hospital Association (1979c). “Monday Report,” Vol. VII, No. 40. Massachusetts Office of State Health Planning (1979). “Health Reports,” Vol. V, No. 6. Monypenny, Phillip, Colby, David and Baker, David (1979). “Legislative Interference in Certificate of Need Decisions: A Study in the Politics of Federalism and Planning.” (mimeo). Williamstown, MA. Rorrie, Colin (1979). “DHEW Program Police Notice 79-10,” Hyattsville, MD:HEW. State House News Service (1979). No Title:Report on August 8, 1979 (mimeo), Boston, MA. Transcript (1979). “Generosity to Hospitals May Reduce Aid to State,” North Adams, MA, October 18. U.S.DHEW (1978). Current Developments in the National Health Planning Program, Washington, D.C.: G.P.O.
165 U.S. House of Representatives (1978). Hearings on Health Planning and Resource Development Amendments of 19 78. Washington, D.C.:G.P.O. U.S. House of Representatives (1979). Hearings on Health Planning and Resource Development Amendments of 1979. Washington, D.C.:G.P.O. U.S. Senate (1978). Hearings on Health PlanningAmendments of 1978. Washington, D.C.:G.P.O.