3. Regional Review Committee of the Central Jersey Health Planning Council On December 1, the evening following the Middlesex CAC meeting, the Regional Review Committee of the Central Jersey Health Planning Council reviewed the RCHP Certificate of Need Application. The applicant and several area provider interests attended. Once again, the applicant and opposing interests presented their arguments, but with more of an opportunity for additional discussion between committee members, applicant and opponents. Consumer members were considerably more evident than at the prior evening's meeting. The Regional Review Committee recommended endorsement of the Certificate (the vote was 8-3 with 1 abstention due to conflict of interest), citing the following as need factors:

Present enrollment and projected growth
demonstrate need for additional square
footage. As of January 1, 1977, the en-
rollment will be 8, 700 individuals; by
July 1977 the projected enrollment will
be nearly 13, 000 and by July 1979, the
projection is for 35,000 individuals.

4.

Central Jersey Health Planning Council On December 8,
the Central Jersey Health Planning Council reviewed the
RCHP Certificate of Need Application. The meeting attracted
a wide audience of provider interests and some consumers.
In order to keep the discussion within a reasonable time
frame, the Council adopted a format it utilized at the prior
month's hearing of a controversial abortion clinic: five
minutes for the applicant to present, and 15 minutes each
for "opponents" and "proponents", with alternating 2-2
minute presentations by each side. "Opposing" views
were presented by representatives of the County Medical
Society, the Osteopathic Association, local physicians,
and two area hospitals which are not currently RCHP
participating hospitals. Several consumers and a repre-
sentative of the State Health Department, as well as the
applicant, spoke as "proponents". There are a number of
problems with this format: Once again, the adversary
nature of the proceedings is counterproductive to the need
to elicit information. In fact, the requirement for speakers
to declare themselves as either "proponents" or "opponents"
provides no appropriate platform for objective, factual
materials to be made available (e.g., by the State Health
Department). The applicant is provided an inadequate

5.

6.

amount of time to present his case and is then put on
the continual defensive in an inappropriate debating
arena. To respond to inaccurate, unfounded, and often
irrelevant and irresponsible charges made by "opponents"
serves to legitimatize such charges; on the other hand,
not to respond to them is to leave seeds of doubt in the
minds of Council members, presenting the applicant
with significant credibility problems. At no time were
issues irrelevant to the demonstration of need ruled out
of order. Specific criteria to be used as guidelines by
HSAs in reviewing HMO Certificates, although presented
by the HSA's executive director, were totally ignored.

The objective of eliciting information would be far better
served through a question and answer format where the
chairperson gives the applicant (and/or Council staff) an
opportunity to respond to responsible, relevant questions.
Permitting unsupportable charges presented by "opponents"
inconflict of interest with the applicant to stand on the record
represents a total subversion of the intent of the certificate
of need process.

The Council failed to endorse the recommendation of its
Regional Review Committee and recommended deferral.
The vote for deferral was 12-10 with one abstention and two
members not voting because of possible conflict of interest.
Other area providers on the Council did not see fit to disqualify
themselves because of possible conflict of interest. Some
consumer members of the Council, concerned with the outcome,
specifically asked that the endorsement of the Regional Review
Committee be included as a minority report.

Mercer County Advisory Committee - On January 4, 1977,
the Mercer CAC reviewed the RCHP Certificate of Need
Application. The Committee recommended endorsement
by a vote of 6-4 (with 1 abstention), specifying a number
of qualifications.

State Review Committee - On January 18, 1977, the State Review Committee unanimously supported RCHP's Certificate of Need request.

recommended that a Certificate of Need be granted to RCHP to expand its facilities.

Group Health Association, Inc. (GHA) is a federally-qualified prepaid group practice HMO which provides health care services to 103, 500 enrollees in the Washington metropolitan area. The enrollee population is distributed as follows: approximately 50,000 enrollees live in the District of Columbia; approximately 37,000 reside in Maryland equal numbers located in Prince Georges and Montgomery Counties; and the remainder, 16, 500 enrollees, live in northern Virginia (most of them in Fairfax County). Hospital care is provided in a number of metropolitan area hospitals.

In recent years, GHA has had two major problems with local planning agencies. The first problem concerned their application to the District of Columbia Planning Agency for a certificate of need to build a hospital and primary secondary care center for the use of its enrollees. Because the success of this application would eliminate GHA's existing D. C. ambulatory facility and because of the growing number of GHA enrollees living in Prince Georges County, GHA also submitted a proposal to establish an ambulatory medical facility in the county. This latter proposal will be discussed here.

Proposal to establish an ambulatory medical facility

In January, 1977, GHAA submitted an application to the Southern Maryland Health Systems Agency (SMHSA) in order to obtain a Section 1122 certification review. The application proposed the development of a satellite clinic in Prince Georges County because GHA had determined that improved access to a GHA facility was necessary for GHA enrollees living in the county.

On February 2, 1977, a staff officer submitted a report to the SMHSA Project Review Committee recommending approval of a one year Section 1122 certification. This report made, among others, the following observations:

The particular clientell served by the proposed center is
not served by nearby facilities but must travel into the District
of Columbia or Hyattsville for services. If the GHA plans for
closing their D. C. facility entirely and moving tertiary functions
into a hospital is realized, subscribers will have no ready access
to medical services.

The Southern Maryland HSA is believed to be a physiciandeficient area leading to gaps in the medical services delivery system. GHA makes use of physician (pick up on page 2)

extenders.

to reduce costs and expand service offerings.

In this regard it functions as a model for providing ambulatory
care. By nature of its organization, it provides competition to
other providers of health services in Southern Maryland but
because of the shortages of providers the impact of this organi-
zation on the other providers would be negligible.

There

At the February 9th meeting of the SMHSA, the Project Review Committee advanced the approval recommendation to the full board. was considerable public comment in opposition to the proposed project, all such opposition coming from providers located in Prince Georges County.

The negative comments included the following: the president of the Southern Maryland Hospital Center did not understand the "sudden desire" for adding health services in predominately rural area, citing an inadequate population based for additional medical services; it was stated that the GHA facility would be a "dramatic encroachment" into the market of the Southern Maryland Hospital Center Ambulatory Facility; and it was stated that there were 80 physicians in the County who would rather establish their own IPA-type HMO "and offer choice of physicians and continue the freeenterprise system." After lengthy discussion, the board voted to resubmit the application to the Committee.

The Project Review Committee scheduled a special meeting on February 23, 1977. This meeting was attended, by, in addition to the Committee members, approximately 100 persons. However, the minutes of the meeting note that the providers who voiced opposition at the SMHSA meeting on February 9th were "noticeably absent".

The Committee, after

hearing several speakers testifying in favor of the project, voted 7-2 to recommend approval of the GHA application.

The governing body of the SMHSA met again on March 9, 1977. The Project Review Committee moved the approval of a one year federal Section 1122 certification. After discussion, the motion was amended to read "the recommendation that Group Health Association be issued a one year Federal Section 1122 Certificate and that a detailed list of services proposed to be offered at the site be appended." So amended, the motion was carried by a

narrow

margin with 13 members affirming, 10 opposing, and 2 members

abstaining.

Health Care Plan, Inc.

664 Ellicott Square Building Buffalo, New York 14203 Arthur Goshin, M. D.

Project Director

The Western New York area is fortunate in having a health systems agency which is well-organized and progressive in its concern for the efficiency and effectiveness of the health delivery system as well as for innovative program development. The agency has had little previous experience with HMO-type organizations, inasmuch as the Health Care Plan and the Western New York Health Planning Corporation, both developing HMO's, are the first in the region. Because the HSA staff and members had a minimal exposure to HMO issues, the agency sponsored a one-day educational session in which federal and state officials as well as HMO executives from other parts of the State were invited to discuss relevant matters. Such sessions are valuable and should be encouraged.

The Health Care Plan has observed certain difficulties with the planning and review process, however. In a recent series of events concerning the HSA review and comment on the initial development applications of the two developing HMO's, important deficiencies in the structure and process of such reviews were encountered.

The Health Care Plan and the Western New York Health Planning Corporation applied for federal initial development funds at the same time and will serve partially overlapping geographical areas. By the usual federal planning parameters, the total area (Erie County and parts of Niagara County) is capable of supporting more than one HMO. At one time in their respective development, the two organizations considered the potential for merger but through a course of discussions concluded that an organizational merger was not feasible. The HSA reviewed two independent applications.

The staff of the HSA is open to admit that, given time constraints and staff expertise, the only feasible review of such applications is a very superficial one. Both applications are approximately 1, 400 pages in length and contain financial and statistical data which could not be adequately reviewed in detail. Moreover, it was not possible for the staff to discern the subtle, underlying differences and objectives. Although the HSA staff was involved in the previous merger discussions, the impracticality of such a move was not fully appreciated. At the same time, the HSA's and state regulatory offices are operating under a criteria of reducing or avoiding non-duplication of service. Hence, the two applications which proposed to