Intergovernmental relations in physician education and health planning: State adoption decisions and the impact of federal programs

Health Policy and Education

3 (1982) 269-283 Elsevier Scientific Publishing Company, Amsterdam - Printed in The Netherlands

269

INTERGOVERNMENTAL RELATIONS IN PHYSICIAN EDUCATION AND HEALTH PLANNING: STATE ADOPTION DECISIONS AND THE IMPACT OF FEDERAL PROGRAMS*

ROGER DURAND Health Resources Administration,

U.S. Department

of Health and Human Services

SHELLY L. NELSON Health Resources Administration,

U.S. Department

of Health and Human Services

KANT PATEL Southwest Missouri State University

ABSTRACT This study seeks to explain states’ adoptions of programs in health planning and in physician education. It also seeks to further understanding of the impact of federal health planning and education programs on the states. Several theories and models are employed in analyzing the actions of state decision-makers. These include incremental theory, models of the diffusion of innovations, economic resources theory, and a theory of competitive partisanship. The data utilized in this research were principally derived from intensive interviews with “key” state actors and from historical, documentary materials. Only miniial federal impact appears on states’ goals in physician education and health planning. Rather, there is evidence of considerable innovativeness among the states prior to Federal program initiatives. A problem-generated search for solutions seems to be a major source of this innovation. Finally, federal program implementation requirements appear to be a major source of federal-state conflict and opposition.

Introduction Echoing the public philosophy of earlier Republican presidencies, the Reagan administration assumed office in January, 198 1, promising to turn over many federal domestic programs to the states. Among the programs selected as candidates for this federal reapportionment were health planning and several programs promoting the training of health professionals. Thus, in its proposed fiscal year (FY) 1982 budget the administration called for a program of bloc grants to the states coupled with phaseout funding for health planning, and no federal support for health professions capitation (FY 1982 budget). *The conclusions drawn and opinions expressed in this paper are solely the responsibility of the authors and not the federal government. The data utilized were gathered under contract HRA230-770135. The sections of this paper on physician education and health planning drew heavily on manuscripts prepared by Patricia Daley and Dan Brandeberry. The authors are grateful to Robert Walkington, Health Resources Administration, U.S. Department of Health and Human Services, for support, encouragement and stimulation. 01652281/82/0000-0000/$02.75

0 1982 Elsevier Scientific Publishing Company

270

These proposals mandate a clear understanding of state decisions and actions in developing and allocating health resources. What has been the record of the states in educating physicians and in health planning? Why have the states adopted the programs they have? What accounts for differences in the timing of states’ adoptions? These are the questions addressed in this paper. On perusal, these questions appear easy to answer. Political, if not conventional, wisdom seems to dictate that the states are either motivated from fear of the federal “stick” or are seduced by the federal “carrot.” Yet, several recent investigations have shed contrary light (see, for example, Buntz et al., 1978). Furthermore, students of states’ policy-making have variously argued the importance of emulation among the states (Walker, 1969; Gray, 1973; Eyestone, 1977; Welch and Thompson, 1980), of a state’s own economic resources (Dye, 1966; Gray, 1976), of the organization of states’ politics (Gray, 1976; Dawson and Robinson, 1963), and of the stability and continuity of policy owing to incremental decision-making (Wildavsky, 1974; Sharkansky, 1968; but see also Albritton, 1979). A fuller understanding of states’ decisions in physician education and health planning would seem to lie scattered in a number of disparate, though related, areas of inquiry. Accordingly, the present research will draw upon several models or bodies of theory. The constructs and related propositions of these theories or models will serve as screens through which the actions of state decision-makers will be interpreted. Following a synopsis of each of these theories, the data and methods of this study will be described. Next, states‘ decisions in physician education and health planning will be analyzed. Finally, implications of the findings for the future of health resource development and distribution will be discussed. Theories of State Policy Adoptions

The models used to analyze state adoptions in the areas of physician education and health planning are principally derived from innovation, incremental, economic resources, and competitive threat theories. The major tenets of these classes of theories are briefly discussed in the following paragraphs. Presently, three models of innovation theory are receiving attention. The regional emulation model, advanced by Walker (1969), proposed that there is an emulative pattern whereby states follow regional leaders in adopting innovative policies. States compare themselves with other states in the “league” or “regional cluster.” Consequently, states use regional reference groups as a point of comparison when deciding whether to adopt an innova-

‘71 index” based upon elapsed tive policy. Walker constructed an “innovative time between the first state adoption of a particular program and its subsequent adoption by other states. He found that the diffusion process forms a geographical pattern based on states’ regional “leagues.” In a subsequent study, Gray (1973) found that interaction among the states provides a means for difffusion of policy innovations across the states. Early adopters exert influence through an interactive effect on states that have not yet adopted. In order to treat all states alike for the purposes of analysis, Gray assumed that she was working with a completely intermixed population. She found that the early/late adoptors of one innovation necessarily were not the early/late adoptors of other innovations. This finding led her to conclude that “innovativeness is not a pervasive factor; rather it is issue-and-time specific. . .” Eyestone (1977), on the other hand, presents the phenomenon of innovations diffusing through a process other than emulation or interaction across the American states. He found that policies diffuse by “point source diffusion” where states respond directly to a federal government example. The federal government serves as the source of the innovation adopted by the states. Incremental theory portrays a method of social change made under the assumption that the status quo with only marginal changes is achieving desired goals. Policy-makers accept previous decisions mainly without review, focusing their attention on a limited number of policy changes that would not cause radical departures from existing reality. Such policy changes tend to be movements away from known problems rather than in the direction of agreed-upon, desired goals. Finally, radical departures in policy, while infrequent, tend to follow from crises (Wildavski, 1974; Lindblom, 1959). The basic hypothesis of the economic resources theory is that the level of states’ economic development determines the level of spending on social welfare programs. Wealthier states are expected to offer more “have-not” oriented programs (that is, programs for the socioeconomically disadvantaged) than poorer states. The corollary prediction is that poorer states tend to devote a larger proportion of available resources to social welfare spending than do their more affluent counterparts (Durand and Patel, 198 1). The competitive threat theory proposes that partisan competition is crucial to states’ spending on programs like public health. According to this theory, two-party competitive states will offer more policies that are beneficial to the “have-nets” than will one-party noncompetitive states (Lockard, 1959). Data and Methods The data utilized

in this research

were principally

derived from the second

272 phase of a two-phase study funded by the Health Resources Administration, U.S. Department of Health and Human Services. The study itself sought to describe and analyze the impact of federal health programs, including health planning and physician education, on state governments in seven states. It also sought to develop a model of states’ responses to federal program initiatives. The seven states included in the study were Connecticut, Georgia, Illinois, New Mexico, Pennsylvania, Tennessee, and Washington. These states were selected following consideration of states’ regional location, population size and density, organization of public health activities (e.g., freestanding health departments vs. umbrella departments of human services), and political partisanship. All of these selection criteria were deemed important to understanding states’ health policy-making. In contrast to the dominant mode of contemporary states’ studies which employ extensive, cross-comparative analyses (e.g., Durand and Patel, 198 1), the data collected for this study were designed to afford an intensive, indepth analysis. Thus, two types of data were collected: responses from unstructured interviews with “key” state actors and historical, documentary materials. In each of the states studied, the following “key” actors were interviewed: senior agency officials; senior program officials; senior officials in other selected state agencies; senior officials in Health Systems Agencies; gubernatorial staffers; state legislators; senior staff members on state legislative committees with public health jurisdictions; legislative research staffers; state budget office personnel; medical school deans; family practice department chairpersons; medical school budget personnel; and representatives of health and medical associations. In addition, federal central and regional office personnel were contacted to identify other individuals in a state who could provide additional information. Open-ended, topical discussion guides were employed in each interview, rather than a standardized questionnaire, in order to adapt the conversation to state characteristics and to the individual’s knowledge. These interviews were supplemented with historical, documentary materials. Such data were obtained from published government sources in Washington, DC, from libraries, and from federal program offices. In each state documentary materials were gathered from state and university libraries, legislative reference bureaus, and from state program offices. In a large number of instances persons who could provide certain materials were contacted by letter or telephone in order to obtain needed documents. These documentary data as well as unstructured interviews suffer a number of limitations. The documentary evidence was often impossible to obtain, especiahy for earlier time periods, and there remain gaps in the historical record. Even when available, such data were often not in an easily

‘73 comparable format, particularly from state to state. The unstructured interviews entail subjectivity both on the part of the “key” actor being interviewed as well as on the part of the researcher who recorded the comments. The tendency to revise history in light of personal or group biases and to recount history as the actions of specific individuals are particular problems. Despite such limitations, these data provide a richness and depth often lacking in studies which attempt only statistical estimation. Findings:

Physician

Education

The issues impacting on physician education are too many and varied to be considered in entirety in this paper. For reasons of issue saliency, this analysis of findings will be limited to two aspects of physician education policy: the expansion of medical school enrollment and the education of primary care physicians. The impact of federal policy will be considered with particular attention to the influence of the federal “carrot” and the federal “stick.” Specifically, the analysis will examine medical school enrollments prior to and after passage of the Comprehensive Health Manpower Training Act of 197 1. Similarly, in regard to the education of primary care physicians, the analysis will focus on the periods preceding and subsequent to both the Comprehensive Health Manpower Act of 197 1 and the Health Professions Educational Assistance Act of 1976. Following this analysis of federal impact, states’ adoption decisions will be examined in light of the several models of states’ decision-making outlined above. At the outset, an important caveat is necessary. Decisions regarding medical school enrollments and primary care education are ultimately made by medical education centers, public and private schools of medicine as well as hospital-based teaching units. It will be necessary to examine the policies and activities of these centers, especially to understand the impact of federal programs. Ultimately, however, it is the adoption decisions of the states that are of concern. FEDERAL IMPACT

The Comprehensive Health Manpower Training Act of 197 1 principally was intended to expand enrollments in schools of medicine. Under the Act, capitation payments-payment of a per capita sum-constituted the principal vehicle to encourage enrollment expansion. This included start-up assistance for new medical schools and assistance for the establishment of two-year medical school degree programs. Among its other provisions, the 197 1 legislation required existing schools of medicine to increase enrollment as a condition for receiving construction grants.

274 In contrast, the Health Professions Educational Assistance Act of 1976 (PL 94-484) shifted the federal emphasis from increasing enrollments to alleviating the specialty and geographic maldistribution of physicians. In order to receive federal support, medical schools were required to train a larger percentage of their students in the primary care specialties of family medicine, internal medicine and pediatrics. Within the provisons of the Act, the earlier construction grant program was amended to provide authority for the construction of primary care educational facilties. Capitation grants were continued; however, in order to qualify, medical schools had to meet specified percentages of residency positions in primary care. Analysis of both documentary materials and the responses of knowledgeable persons made clear that these federal programs did not result in shifts in the goals of medical schools. Although in several instances the federal program increased awareness on the part of medical educators of national goals, especially the goal of primary care, if a school had chosen not to emphasize primary care the federal legislation was rendered ineffective. Generally, little opposition to the objectives of the federal programs was found on the part of medical schools. Even those institutions that saw geographic and specialty maldistributions as problems recognized the need for federal programs to emphasize training in primary care. Opposition by medical schools over federal programs often centered on program implementation requirements rather than on actual goals. An example of this opposition concerns PL 94-484 requirements that medical schools accept U.S. foreign medical student transfers as a condition for capitation payments. Although the medical school officials concurred with the goal of assuring an adequate supply of physicians generally, they were quick to denounce the acceptance of the provision of foreign transfers as federal encroachment on their admissions policies. Probably the most significant impact of federal programs, as revealed by the data of this study, has been on the construction of medical school facilities. Since 1965 twenty-seven new schools of medicine have been established. Virtually every medical education center received some federal construction support. State and local governments and some private foundations have also contributed to the construction of medical teaching facilities, but it is clear that many medical education centers could not have been built without federal ‘support. The intent of federal medical education legislation has not been to interfere in the administrative organization of medical schdols. Generally, federal programs use incentives rather than controls, to ensure that medical education centers meet U.S. health care needs. The use of such incentives has resulted in one significant administrative change in most medical schools the establishment of departments of family medicine. Some of the schools

275 examined gave academic status to family medicine prior to the existence of federal incentives. But once federal funds for family medicine became available, many of these schools created separate family medicine departments. A number of medical schools have departments of family medicine only because there is special federal and, in some cases, state money that is specifically allocated to family medicine departments. Federal money also allowed medical schools to experiment with alternative teaching programs. However, real substantive changes appear to have been minimal. For example, many schools experimented with a three-year curriculum, but most have reverted to the traditional four-year program. The one innovation that seems to be succeeding is family medicine; federal support appears to be the major contributing factor. One of the salient findings from the data is that since 1963 the impact of federal programs on the output of medical schools has been substantial. In 1963 there were 7,264 medical school graduates. In 1975, by way of contrast. there were 13,7 14 graduates representing a 75 percent increase over 1963. Over this same period the number of medical schools grew from 88 to 114. Certainly support from state and local governments and from private foundations contributed to this growth, but federal money provided a major stimulus. PL 94-484 required that by 1980 50 percent of first-year residencies affiliated with primary care training be in primary care specialties. This goal was easily met. Regrkttably, not enough time has elapsed to accurately gauge the full effect of this federal program. This is because many students enter first-year primary care residencies then subspecialize in other areas. Nonetheless, the number of first-year primary care residencies has increased and more students are selecting primary care residencies. Federal programs in financing medical education have not been without negative effects. Capitation grants tended to make medical education centers more dependent on federal support. Expansion has required large federal outlays. If that money continues its present decline, those schools without alternative financing may find it difficult to continue operating at existing levels. Some schools have already recognized this problem and have drastically raised tuition. Others are reluctant to accept federal support, especially for primary care, for fear that this money will dry up and render them unable to support their primary care programs. STATE

DECISIONS

Federal impact aside, additional insights into states’ decisions regarding physician education can be gained through the perspectives afforded by the models of decision-making previously outlined. Both the documentary

276 materials and the unstructured interviews revealed considerable evidence of innovation by both medical education centers and the states. Several of the education centers and states initiated program activities prior to actions by the federal government. Indeed, a number of states’ activities were found to be modeled in the federal legislation. Among the states and medical education centers studied, several initiated programs independently to increase enrollments and to construct new teaching facilities. In 1963, New Mexico responded to the obvious need for physicians in the state by establishing a two-year medical school. The Pennsylvania State University College of Medicine in Hershey opened its doors in 1967; the University of Connecticut admitted its first class in 1968; and Southern Illinois opened in 1969. With the exception of the Hershey Medical Center, which received funding from the Hershey Chocolate Corporation, these medical centers were all initiated through the combined efforts of university and state officials. Only later was federal funding for construction and operating costs received. Even though Illinois had been a net exporter of physicians, key individuals in that state recognized quite early that its medical schools were not meeting the state’s physician workforce needs. In the 1960s Illinois developed a regional medical education system with a series of semi-autonomous schools that are located on the Medical Center campus, on the Urbana-Champaign campus, and in the cities of Peoria and Rockford. In addition to the expansion of enrollment, primary care education was also the subject of much state innovation prior to federal program initiatives. Of the sixteen medical education centers examined, four could easily be classified as innovators in primary care physician education-University of Washington, University of New Mexico, University of Illinois, and Pennsylvania State University. These institutions were able to develop unique physician education programs before similar federal programs. The Department of Family and Community Medicine at the Hershey Medical Center was established in 1967 at a time when there was no similar department in the United States. The University of Washington School of Medicine was also an innovator. A 1968 curriculum review redirected the school away from an emphasis on academic research toward an emphasis on the education of primary care physicians. This led to the simultaneous development in 197 1 of a Department of Family Medicine and WAMI (Washington, Alaska, Montana, and Idaho) program. The WAMI program is a unique innovation in decentralizing medical care education. WAMI was originally the idea of three University of Washington faculty members who conveyed their idea to U.S. Senator Warren Magnuson, a powerful figure in national health policy, and to the state legislatures of the four states. The

277 WAMI idea, however, was borrowed from the Indiana statewide medical education system. Washington’s innovativeness was continued in 1975 with the establishment of a statewide system for family practice training, a system that was again heavily influenced by features of Indiana’s statewide plan. As enacted in 1975, the authorizing legislation gave the University of Washington School of Medicine responsibility for implementing a family practice residency network. Finally, New Mexico passed a medical student loan act in 1975 which requires as a loan condition that the student recipient practice medicine in a physician shortage area within that state. New Mexico led all other states in being the first to require continuing education for physician relicensure. As is evident from these state programs, there has been substantial innovativeness in medical school enrollments and primary care education that has not been directed by the federal government. Additionally, these programs are revealing of regional communications of the kind suggested by Walker’s innovation model (e.g., WAMI) as well as of almost wholesale emulation (e.g., the Indiana model). Finally, these programs show evidence of “innovativeness”: those centers and states that innovated in one area of physician education were likely to be innovators in another (e.g.. New Mexico). What are the conditions which produced innovation in the first place? Unfortunately, the models of innovation described earlier provided little insight into those factors that caused innovation. Evidence from both documentary materials and interviews suggest that four factors may have been necessary to innovation in medical school enrollments and in primary care education. These four factors are the following: recognition of a severe problem (i.e., primary care physician shortages in the state); widespread political support for a corrective program; available financial resources; and active promotion by key actors. The evidence seems to show that these four factors distinguished state innovators from both early and late adopters of the federal programs. The early adopters of federal programs, those states described by Gray (I 973) and Eyestone (1977) as subjects of “constant-source” or “pointsource” diffusion, tended to be those medical education centers that perceived the need for such activities, but which lacked needed financial resources. Federal financial support permitted such centers or states to implement programs they previously could not afford. Late adopters of the federal programs, by way of contrast, tended to be those centers or states in which no perceived need for a program existed. Additional understanding of states’ adoptions in physician education can be gained through the perspectives of models described earlier. As noted, a

278 state’s economic resources were crucial to its innovativeness: those states with available financial resources were most likely to develop unique physician education programs before similar federal initiatives. The importance of state economic resources to medical education is further demonstrated by the fact that most of the medical schools established in the past two decades have been public. Of the 27 medical schools that have been established since 1965, only five are private. This evidence suggests the importance of state assistance in the development of new medical schools, at least in recent years. While the importance of available financial resources to state adoptions in physician education is indisputable, the status of being an economic “have” cannot necessarily be equated with financial availability. Among the states studied, New Mexico is a relatively impoverished state that has made available the financing necessary for innovations in physician education. Pennsylvania, an economic “have,” at least as measured by per capita income, failed to provide the money necessary to fund a statewide education plan for physicians. Recognized severe problems, politics, and program entrepreneurship all appear to conspire to render economic resources into available resources. Incrementalism and the heavy hand of the past were also in evidence especially among those medical education centers described earlier as “late adopters.” While some medical schools revised their curricula, others continued to follow the traditional course of medical study. Traditional undergraduate physician education stresses instruction in basic sciences and clinical work in medicine, pediatrics, surgery, obstetrics-gynecology, and psychiatry among other medical subjects. This traditional curriculum was found particularly evident in such schools as Emory, Yale and the University of Pennsylvania which emphasize biomedical research. The traditional curriculum, especially at the undergraduate level, has been widely criticized for failing to adequately support primary care education. Primary care education requires a greater amount of non-institutional training so that students concentrate on the family instead of exclusively on the disease. Medical centers often have large research commitments which work as disincentives for the institution to invest in primary care education. Sunk costs or overhead commitments tended to promote only incremental curricular revisions. No evidence was found of competitive threat or bipartisan political conflict over physician education. It may be that physician education is not viewed as a policy for the socially disadvantaged. Or perhaps “socially disadvantaged” is more broadly defined in physician care than in other program areas. Whatever the case, the competitive threat model provided little insight into state adoptions in physician education.

279 Findings: Health Planning Having summarized observations with regard to physician education, findings concerning health planning will now be considered. Initially, the effects of the National Health Planning and Resource Development Act of 1974 (PL 93-641 as amended) will be analyzed. Then, the several models of states’ decision-making described above will be utilized to examine states’ adoptions in health planning. FEDERALIMPACT

In 1974, Congress enacted the National Health Planning and Resource Development Act, more popularly known as PL 93-641. This legislation represented a consolidation of three earlier health planning programs: the Hill-Burton Program, which began in 1946; the Regional Medical Program or RMP passed in 1965; and the Comprehensive Health Planning Program (CHP) enacted in 1966. Although this legislation was amended by the Ninety-sixth Congress, its essential provisions remain the same. A network of Health Systems Agencies (HSAs) was created in service areas designed by the Department of Health and Human Services in consultation with state governors. Each HSA was mandated to prepare and implement plans to improve the health status of area residents; increase the accessibility, acceptability, continuity and quality of health services; prevent unnecessary duplication of resources; and restrain costs in the provision of health services. In addition to receiving operating funds, fully designated HSAs were made eligible to receive federal funding for special projects that advance the goals of several of the HSA’s plans. PL 93-641 also mandated the creation of a State Health Planning and Development Agency (SHPDA), the members of which are appointed by each state’s governor. A Statewide Health Coordinating Council (SHCC) was mandated along with certain membership requirements. States failing to carry out these mandates faced the threat of withdrawal of all federal assistance provided under the authority of the Public Health Service Act. Considerable variation in response to PL 93-641 was exhibited in the seven states included in the study. The states of Connecticut and Washington developed alternative means of containing medical care costs - one of the important objectives of the federal legislation. Tennessee and Illinois anticipated the requirement in this and related federal legislation of some kind of needs demonstration for the construction of health facilities. New Mexico continues to be committed to increasing the availability and accessibility of health services to its population over and above other goals embodied in

280

the Act. In both Pennsylvania and Georgia, PL 93-641 has generated considerable controversy, especially from provider interests. One of the areas that exhibited particular interstate variability has been the placement of the health planning agencies in states’ organizational structures. New Mexico’s SHPDA is a major component of one of five divisions within that state’s Department of Health. Washington’s SHPDA is buried in the fourth tier of the Department of Social and Health Services. Tennessee has established an independent authority that reports directly to the governor. Similar variation exists in the health planning process adopted by the states in response to PL 93-641. In the design of their health regulatory programs, particularly those calling for a certificate-of-need for capital expenditures, states have frequently disagreed with the federal model. Among the seven states studied, Georgia, Connecticut, New Mexico and Washington had certificate-of-need programs (CON) that did not fully comply with the federal regulations, At the time of this study Pennsylvania failed to pass any CON law. Interstate variation and opposition to federal requirements was also found in the planning process itself. For example, in most states the HSAs are developing faster than the SHPDA, but in Connecticut the reverse is true. Connecticut was one of a few states where the state health plan was developed at the state level rather than through the process where the SHPDA combines the plans of several HSAs. When completed, Connecticut’s plan was broken down into regional plans in coordination with the HSAs. This variation in states’ responses is, after all, hardly surprising. The goals embodied in PL 93-641 (e.g. accessibility, quality, availability) are ambiguous, permitting much state and local latitude in definition. Moreover, these goals are, at least potentially, mutually inconsistent thus allowing state and local emphasis of one over another. For example, it may not be possible to simultaneously contain health costs and increase accessibility to health care - especially if accessibility means lowering barriers to care for the economically disadvantaged. Thus, New Mexico has chosen to enhance accessibility while Washington (state) has stressed cost containment. The direction of the legislation has been to stress state and local planning for state and local needs. It should be noted that opposition has been more likely to arise over the implementation requirements than over the objectives of PL 93-641, at least in the seven states studied. One of the states, Georgia, failed to establish the mandated state health planning structure by 1979. Many states departed from the model advanced in the federal legislation of placing responsibility for both planning and regulating with the SHPDA. Tennessee, for example, separated these responsibilities by delegating the power to regulate to the

281 Tennessee Health Facilities Commission through contract with the SHPDA. Connecticut allowed its rate review commission, the Commission on Hospital and Health Care, to retain its regulatory authority thereby separating planning from regulation. STATE DECISION-MAKING

Besides the federal impact just described, the documentary data and unstructured interviews provided considerable evidence of states’ innovations in health planning. Two of the seven states, Connecticut and Washington, enacted requirements for certification of need for the construction or expansion of health care facilities prior to federal enactment of a similar provision in Section 1122 of the Social Security Amendments of 1972 (PL 92-603). Two other states, Tennessee and Illinois, enacted CON legislation before it became a requirement under PL 93-641. While Connecticut and Washington were responding to clearly identified problems within those states. Tennessee and Illinois, at least in part, were responding to the likelihood of a future federal requirement for CON. That is, these latter two states anticipated the federal requirement and acted either to avert or to mitigate the effects of the federal action. Thus, “anticipatory reactions” were an important impetus to innovation in health planning. During this same period the states of Connecticut and Washington were also innovators in addressing the problem of escalating medical care costs. Each of these states enacted legislation in 1973 to review hospital budgets and charges. In doing so they were among the first three states in this country to establish hospital rate review commissions. A widely recognized problem, rather than emulation or interstate communication, within these states provided the spur to innovation. Marginal changes away from known problems and crisis-generated goal adjustments are, as noted, two propositions central to the incremental model of decision-making. These two propositions provided considerable understanding of the behavior of the states in health planning. At the time of the passage of PL 93-64 1, New Mexico was strongly committed to dealing with the problem of limited availability and accessibility to health care within the state. Connecticut and Washington, on the other hand, were faced with rapidly increasing medical care costs. Other states studied were addressing the problems of availability and accessibility but were increasingly forced to deal with medical cost inflation. The states of Washington, Connecticut and New Mexico failed to exhibit any change in their health planning goals as a consequence of PL 93-641. Rather. each continued to edge away from “known problems”: spiraling costs in the case of the first two states; accessibility and availability in the

282 case of New Mexico. The other four states in this study exhibited goal changes ranging from concern about availability and accessibility to health care to medical care cost containment. This swing was apparently not occasioned by the federal legislation. Instead, spiraling costs reached crisis proportions, forcing states to adjust their health planning goals. It should be pointed out that neither the economic resources model nor the competitive threat model added understanding to states’ health planning adoption decisions. A state’s overall financial picture has little bearing on the adoption of a relatively small, planning and regulatory program. Similarly, health planning per se - apart from dramatic planning decisions - is of such limited visibility in state policy-making that it offers the political parties little in their search for popular support. Conclusions

and Discussion

The findings summarized in the preceding sections show evidence of minimal federal impact on states’ goals in physician education and health planning. Neither the threat of the “stick” nor the enticements of the “carrot” appear to have altered states’ intentions in these program areas. This is hardly a surprising result given the ambiguous, often inconsistent nature of federal program goals and the rapidity with which programs change. Lack of clarity and sequential, rather than simultaneous, emphasis on inconsistent goals coupled with an uncertain program future probably mitigate conflict between federal and state goals. The same, however, cannot be said of program implementation requirements. Such requirements are usually written in the rather precise language of federal regulations and administered daily by career executives with program stakes and a purview limited to narrow, subprogram features. Because federal requirements often directly demand changes in states’ administrative practices, information, and structures, they are often the source of much conflict and opposition. As noted, this conflict was found to be the case in physician education and health planning. In both of these program areas there was evidence of considerable innovativeness among the states prior to federal program initiatives. Generally, different factors seemed to give impetus to state innovations in physician education than to health planning. But there was a common thread: the widespread recognition of a rather severe problem appeared to be one cause of a state’s trying out a new program solution. A problem-generated search for solutions, then, seems to be a source of innovation - at least in physician education and health planning. To speculate, this evidence of state innovativeness and the findings on federal impact are suggestive of a “volleyball” model of federalism which tends to operate in physician education and health planning. Faced with a

‘83 pressing problem, one or more states innovate and diffuse the innovation to a few others, including the federal government. Part or all of the innovation is subsequently incorporated into a federal program and diffused to other states. This process probably continues with successive state adoptions more dependent upon the severity of the problem within the state than upon federal program objectives. If this model of federalism and the findings of this research are even approximately correct, then turning over federal programs in physician education and health planning to the states in the form or bloc grants is likely to have at least two consequences. First, such a change likely would slow, but probably not eliminate, the diffusion of public health innovations. Second, due to a reduction, if not elimination, of federal implementation requirements, states’ administrative practices, information, and structures would be less pressured to change. These two probable consequences are. ot course, among the likely intentions of the Reagan Administration. In the last analysis, it is quite uncertain whether the states will be willing recipients of federal bloc grant programs. The unpredictability of future federal funding may make the states wary of becoming too deeply involved in programs that may attract politically powerful constituents. Additionally, there are uncertainties about the activities state administrative officials might be expected to perform. Finally, state decision-makers are likely to be drawn into political conflicts that they may have been able to avoid or direct toward the federal government in the past. References Albritton, Robert (1979). “Measuring public policy: impact of the supplemental social security income program,” Americnn Journal o.fPolitical Science, 23 (3): 559-518. Buntz, C. Gregory et al. (1978). “Federal influence on state health policy,” Jouriral of~l-lrealthPolitics. PoZicy arid Law 3 (1): 71-86. Dawson, R.E. and Robinson, James (1963). “inter-party competition. economic variables and welfare policies in the American states,” Journal 01 Politics 23 (1): 265-289. Durand, Roger and Patel, Kant (1981). “A comparative analysis of public health expenditures in the states of India and the United States,” Journal ofPolitical Science 8 (2): 114-133. Dye, Thomas (1966). Politics. Economics and the Public. Chicago: Rand McNally. Eyestone. Robert (1977). “Confusion, diffusion, and innovation,” Americarl Political Sciutre Rel,ieH, 71 (2): 441-447. Gray, Virginia (1973). “Innovation in the states: a diffusion study.” American Political Science Review 67 (4):1174-1185. Gray, Virginia (1976). “Models of comparative state politics: a comparison of cross-sectional and time series analysis,” American Journal of Political Scierxe 20 (2): 235-256. Lindblom, Charles E. (1959). “The science of ‘muddling through’,” Public Administration Review 19 (Spring): 79-88. Lockard, Duane (1959). New England State Politics. Princeton: Princeton University Press. Sharkansky, Ira (1968). Spending in the American States. Chicago: Rand McNally. Walker, Jack (1969). “The diffusion of innovations among the American states,” American Political Science Review 63 (3): 880-899. Welch, Susan and Thompson, Kay (1980). “The impact of federal incentives on state policy innovation,” American Journal Oj’Political Science 24 (4): 7 15-129. Wildavsky, A. (1974). The Politics o.fthe Budgetary Process. Boston: Little Brown and Co.