Health Care Access: Opportunities to Target Programs and Improve
Accountability (Testimony, 09/11/97, GAO/T-HEHS-97-204).

GAO discussed the Rural Health Clinic Program in the broader context of
GAO's past reviews of federal efforts to improve access to primary
health care, focusing on: (1) the common problems GAO found and some
recent initiatives to address them; and (2) how the type of management
changes called for under the Government Performance and Results Act of
1993 can help the Rural Health Clinic and related programs improve
accountability.

GAO noted that: (1) GAO's work has identified many instances in which
the Rural Health Clinic program and other federal programs have provided
aid to communities without ensuring that this aid has been used to
improve access to primary care; (2) in some cases, programs have
provided more than enough assistance to eliminate the defined shortage,
while needs in other communities remain unaddressed; (3) GAO's work has
identified a pervasive cause for this proa reliance on flawed systems
for measuring health care shortages; (4) these systems often do not work
effectively to identify which programs would work best in a given
setting or how well a program is working to meet the needs of the
underserved once it is in place; (5) for several years, the Department
of Health and Human Services has tried unsuccessfully to revise these
systems to address these problems; and (6) the goal-setting and
performance measurement discipline available under the Results Act,
however, appears to offer a suitable framework for ensuring that
programs are held accountable for improving access to primary care.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-HEHS-97-204
     TITLE:  Health Care Access: Opportunities to Target Programs and 
             Improve Accountability
      DATE:  09/11/97
   SUBJECT:  Accountability
             Health services administration
             Health care programs
             Health centers
             Physicians
             Health care costs
             Health care planning
             Community health services
             Health care services
             Health resources utilization
IDENTIFIER:  HHS Rural Health Clinic Services Program
             Medicare Incentive Payment Program
             USIA J-1 Visa Program
             HCFA Federally Qualified Health Center Program
             Medicaid Disproportionate Share Hospital Program
             National Health Service Corps Scholarship Program
             HHS Health Professional Shortage Area System
             HHS Medically Underserved Area System
             Medicare Program
             Medicaid Program
             HHS Healthy People 2000 Program
             
******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO report.  Delineations within the text indicating chapter **
** titles, headings, and bullets are preserved.  Major          **
** divisions and subdivisions of the text, such as Chapters,    **
** Sections, and Appendixes, are identified by double and       **
** single lines.  The numbers on the right end of these lines   **
** indicate the position of each of the subsections in the      **
** document outline.  These numbers do NOT correspond with the  **
** page numbers of the printed product.                         **
**                                                              **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced.  Tables are included, but    **
** may not resemble those in the printed version.               **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
** A printed copy of this report may be obtained from the GAO   **
** Document Distribution Center.  For further details, please   **
** send an e-mail message to:                                   **
**                                                              **
**                                            **
**                                                              **
** with the message 'info' in the body.                         **
******************************************************************


Cover
================================================================ COVER


Before the Subcommittee on Human Resources, Committee on Government
Reform and Oversight,
House of Representatives

For Release on Delivery
Expected at 10:00 a.m.
Thursday, September 11, 1997

HEALTH CARE ACCESS - OPPORTUNITIES
TO TARGET PROGRAMS AND IMPROVE
ACCOUNTABILITY

Statement of Bernice Steinhardt, Director
Health Services Quality and Public Health Issues
Health, Education, and Human Services Division

GAO/T-HEHS-97-204

GAO/HEHS-97-204T


(108311)


Abbreviations
=============================================================== ABBREV

  HHS - x
  HPSA - x
  MUA - x
  HCFA - x
  HRSA - x

HEALTH CARE ACCESS:  OPPORTUNITIES
TO TARGET PROGRAMS AND IMPROVE
ACCOUNTABILITY
============================================================ Chapter 0

Mr Chairman and Members of the Subcommittee: 

We are pleased to be here today to expand on our testimony regarding
the Rural Health Clinic program that we presented to you last
February.  In that testimony, we said that the program did not focus
on improving access to care in areas that most needed it.  Today, we
would like to discuss our findings in the broader context of our past
reviews of federal efforts to improve access to primary health care. 
The federal government spends billions of dollars each year on
programs like the Rural Health Clinic program that, in whole or part,
are aimed at achieving this objective.  I would like to (1) summarize
the common problems we found and some recent initiatives to address
them and (2) discuss how the type of management changes called for
under the Government Performance and Results Act of 1993 (Results
Act) can help the Rural Health Clinic and related programs improve
accountability. 

In brief, our work has identified many instances in which the Rural
Health Clinic program and other federal programs have provided aid to
communities without ensuring that this aid has been used to improve
access to primary care.  In some cases, programs have provided more
than enough assistance to eliminate the defined shortage, while needs
in other communities remain unaddressed.  Our work has identified a
pervasive cause for this problem:  a reliance on flawed systems for
measuring health care shortages.  These systems often do not work
effectively to identify which programs would work best in a given
setting or how well a program is working to meet the needs of the
underserved once it is in place.  For several years, the Department
of Health and Human Services (HHS) has tried unsuccessfully to revise
these systems to address these problems.  The goal-setting and
performance measurement discipline available under the Results Act,
however, appears to offer a suitable framework for ensuring that
programs are held accountable for improving access to primary care. 


   BACKGROUND
---------------------------------------------------------- Chapter 0:1

All communities contain populations that may have difficulty
accessing primary health care services for reasons such as geographic
isolation or, more often, inability to pay for care.  Multiple
federal agencies, often with state and local governments as partners,
have long supported a broad range of programs to remedy these access
problems.  The largest and best known is Medicaid, which spent over
$161 billion in fiscal year 1996 on health and long-term care for
low-income Americans considered to be unable to purchase services.\1
However, over 30 other programs exist.  (See appendix for an overview
of some of these programs.) These other programs, which collectively
spent more than $1 billion a year as of 1996, use one of three
strategies aimed to ensure that all populations have access to care. 

  -- Providing incentives to health professionals practicing in
     underserved areas.  Under the Rural Health Clinic and Medicare
     Incentive Payment programs, providers are given additional
     Medicare and/or Medicaid reimbursement to practice in
     underserved areas.  In 1996, these reimbursements amounted to
     over $400 million.  In addition, over $112 million was spent on
     the National Health Service Corps program, which supports
     scholarships and repays education loans for health care
     professionals who agree to practice in designated shortage
     areas.  Under another program, called the J-1 Visa Waiver, U.S. 
     trained foreign physicians are allowed to remain in the United
     States if they agree to practice in underserved areas.\2

  -- Paying clinics and other providers caring for people who cannot
     afford to pay.  More than $758 million funded programs that
     provide grants to help underwrite the cost of medical care at
     community health centers and other federally qualified health
     centers.  These centers also receive higher Medicare and
     Medicaid payments.  Similar providers also receive higher
     Medicare and Medicaid payments as "look-alikes" under the
     Federally Qualified Health Center program. 

  -- Paying institutions to support the education and training of
     health professionals.  Medical schools and other teaching
     institutions received over $238 million in 1996 to help increase
     the national supply, distribution, and minority representation
     of health professionals through various education and training
     programs under Titles VII and VIII of the Public Health Service
     Act. 


--------------------
\1 Medicaid is a joint federal-state program, which in fiscal year
1996 financed health care for about 37 million low-income, blind,
disabled, and elderly people.  The federal contribution to state
Medicaid programs in that year amounted to $91.9 billion or about 57
percent of the $161.2 billion total.  In 1995, more than 70 percent
of Medicaid expenditures paid for care for the elderly, blind, and
disabled and for payments to hospitals serving large numbers of
Medicaid and low-income patients under the Disproportionate Share
Hospital program. 

\2 In 1995, 4 federal agencies and 23 states requested waivers to
requirements that foreign physicians return to their home country
after completing U.S.  medical training under a J-1 visa. 


   PROGRAMS NEED TO IMPROVE THEIR
   FOCUS ON ACCESS PROBLEMS
---------------------------------------------------------- Chapter 0:2

Over the past several years, we have issued a number of reports
examining most of these programs.\3 Our findings show that while the
Rural Health Clinic program and other federal programs have provided
resources to improve access to primary care, the programs
historically have not been held accountable for showing that access
has indeed improved.  Here are some examples: 

  -- The Rural Health Clinic program--which had an original purpose
     to subsidize health care in remote rural areas lacking
     physicians--now costs Medicare and Medicaid more than $295
     million a year\4 to primarily subsidize care in cities and towns
     already having substantial health care resources.  Our review of
     a sample of clinics showed that the availability of care did not
     change appreciably for at least 90 percent of Medicare and
     Medicaid beneficiaries using the clinics.  Staff we interviewed
     at most clinics said they did not use the subsidies to expand
     access to underserved portions of the population or need the
     subsidies to remain financially viable.\5

  -- The Medicare Incentive Payment program, created out of concern
     that physicians would not treat Medicare patients due to low
     Medicare reimbursement rates, pays all physicians in designated
     shortage areas a 10-percent bonus on Medicare billings. 
     Physicians receive bonus payments now totaling over $100 million
     each year, even in shortage areas where Medicare patients are
     not underserved or where low Medicare reimbursement rates are
     not the cause of underservice.\6

  -- Federal and state programs placing providers in underserved
     areas have oversupplied some communities and states with
     providers, while others received none.  Considering the National
     Health Service Corps program alone, at least 22 percent of
     shortage areas receiving National Health Service Corps providers
     in 1993 received providers in excess of the number needed to
     remove federal designation as a shortage area,\7 while 785
     shortage areas requesting providers did not receive any
     providers at all.  Of these latter locations, 143 had
     unsuccessfully requested a National Health Service Corps
     provider for 3 years or more.\8 Taking other provider placement
     programs into account shows an even greater problem in
     effectively distributing scarce provider resources.  For
     example, HHS identified a need for 54 physicians in West
     Virginia in 1994, but more than twice that number--116
     physicians--were placed there using the National Health Service
     Corps and J-1 Visa Waiver programs.  We identified eight states
     where this occurred in 1995.\9

  -- While almost $2 billion has been spent in the last decade on
     Title VII and VIII education and training programs, HHS has not
     gathered the information necessary to evaluate whether these
     programs had a significant effect on changes that occurred in
     the national supply, distribution, or minority representation of
     health professionals or their impact on access to care. 
     Evaluations often did not address these issues, and those that
     did address them had difficulty establishing a cause-and-effect
     relationship between federal funding under the programs and any
     changes that occurred.  Such a relationship is difficult to
     establish because the programs have other objectives besides
     improving supply, distribution, and minority representation and
     because no common goals or performance measures for improving
     access had been established.\10


--------------------
\3 We have not reviewed how health center grants or benefits provided
to other federally qualified health centers improved access to care. 
However, we did review HHS budget documentation for programs directed
at relieving underservice, including the health center programs. 

\4 This is the estimated additional cost to the Medicare and Medicaid
programs due to higher payment rates to rural health clinics. 

\5 We reviewed the health care resources of a sample of communities
where 144 rural health clinics were certified in 4 states:  Alabama,
Kansas, New Hampshire, and Washington.  We analyzed past access to
care for Medicare and Medicaid beneficiaries using 119 of these
clinics, and subsequently interviewed staff at 76 of the clinics. 
See Rural Health Clinics:  Rising Program Expenditures Not Focused on
Improving Care in Isolated Areas (GAO/HEHS-97-24, Nov.  22, 1996) and
related testimony (GAO/T-HEHS-97-65, Feb.  13, 1997). 

\6 See Health Care Shortage Areas:  Designations Not a Useful Tool
for Directing Resources to the Underserved (GAO/HEHS-95-200, Sept. 
8, 1995). 

\7 In creating the federal health professional shortage area
designation system, federal intervention was considered justified
only if the number of health care providers was significantly less
than adequate, indicating that the needs of these areas were not
being met through free-market mechanisms or reimbursement programs. 

\8 See National Health Service Corps:  Opportunities to Stretch
Scarce Dollars and Improve Provider Placement (GAO/HEHS-96-28, Nov. 
24, 1995). 

\9 For these eight states, the number of J-1 visa physicians for whom
waivers were processed in 1994 and 1995, combined with the number of
National Health Service Corps physicians in service at the end of
1995, exceeded the number of physicians to remove health professional
shortage area designations in the state.  See Foreign Physicians: 
Exchange Visitor Program Becoming Major Route to Practicing in U.S. 
Shortage Areas (GAO/HEHS-97-26, Dec.  30, 1996). 

\10 See Health Professions Education:  Role of Title VII/VIII
Programs in Improving Access to Care is Unclear (GAO/HEHS-94-164,
July 8, 1994) and Health Professions Education:  Clarifying the Role
of Title VII and VIII Programs Could Improve Accountability
(GAO/HEHS-97-117, Apr.  25, 1997). 


      LIMITATIONS OF EXISTING
      APPROACHES USED TO MEASURE
      NEED AND TARGET ASSISTANCE
-------------------------------------------------------- Chapter 0:2.1

Our work has shown that these programs share a common problem:  HHS
does not have a way to effectively match the various programs with
the specific kinds of access problems that exist.  Its systems for
identifying underservice are so general that they often are of little
help in identifying who is underserved and why.  Likewise, these
systems are often of little use in measuring whether a program, once
applied, is having any effect on the problem.  Despite 3 decades of
federal efforts, the number of areas HHS has classified as
underserved using these systems has not decreased. 

HHS uses two systems to identify and measure underservice:  the
Health Professional Shortage Area (HPSA) system and the Medically
Underserved Area (MUA) system.  First used in 1978 to place National
Health Service Corps providers, the HPSA system is based primarily on
provider-to-
population ratios.  In general, HPSAs are self-defined locations with
fewer than one primary care physician for every 3,500 persons.\11
Developed at about the same time, the MUA system more broadly
identifies areas and populations considered to have inadequate health
services, using the additional factors of poverty and infant
mortality rates and percentage of population aged 65 or over. 

We previously reported on the long-standing weaknesses in the HPSA
and MUA systems in identifying the types of access problems in
communities and in measuring how well programs focus services on the
people who need them, including the following: 

  -- The systems have relied on data that are old and inaccurate. 
     About half of the U.S.  counties designated as medically
     underserved areas since the 1970s would no longer qualify as
     such if updated using 1990 data.\12

  -- Formulas used by the systems, such as physician-to-population
     ratios, do not count all primary care providers available in
     communities, overstating the need for additional physicians in
     shortage areas by 50 percent or more.  The systems fail to count
     the availability of those providers historically used by the
     nation to improve access to care, such as National Health
     Service Corps physicians and U.S.  trained foreign physicians,
     as well as nurse practitioners, physician assistants, and nurse
     midwives. 

One result of such problems is the sheer number of HPSAs and MUAs
that now exist, minimizing the usefulness of the systems in targeting
assistance.  Eighty-eight percent of all U.S.  counties had HPSAs,
MUAs, or both as of June 1995.  Even when the systems accurately
identify needy areas, they often do not provide the information
needed to decide which programs are best suited to an area's
particular need.  Designations are generally made for broad
geographic areas without considering the demand for services.  As a
result, the systems do not accurately identify whether access
problems are common for everyone living in the area, or whether only
specific subpopulations, such as the uninsured poor, have difficulty
accessing primary care resources that are already there but
underutilized.  Without additional criteria to identify the type of
access barriers existing in a community, programs may not benefit the
specific subpopulation with insufficient access to care. 

The Rural Health Clinic program, established to improve access in
remote rural areas, illustrates this problem.  Under the program, all
providers located in rural HPSAs, MUAs, and HHS-approved
state-designated shortage areas can request rural health clinic
certification to receive greater Medicare and Medicaid reimbursement. 
However, if the underserved group is the uninsured poor, such
reimbursement does little or nothing to address the access problem. 
Most of the 76 clinics we surveyed said the uninsured poor made up
the majority of underserved people in their community, yet only 16
said they offered health services on a sliding-fee scale based on the
individual's ability to pay for care.  Even if rural health clinics
do not treat the group that is actually underserved, they receive the
higher Medicare and Medicaid reimbursement, without maximum payment
limits if operated by a hospital or other qualifying facility.  These
payment benefits continue indefinitely, regardless of whether the
clinic is no longer in an area that is rural and underserved. 

Last February, we testified before this Subcommittee that improved
cost controls and additional program criteria were needed for the
Rural Health Clinic program.  In August of this year, the Balanced
Budget Act of 1997 made changes to the program that were consistent
with our recommendations.  Specifically, the act placed limits,
beginning next January, on the amount of Medicare and Medicaid
payments made to clinics owned by hospitals with more than 50 beds. 
The act also made changes to the program's eligibility criteria in
the following three key areas:\13

  -- In addition to being located in a rural HPSA, MUA, or
     HHS-approved state- designated shortage area, the clinic must
     also be in an area in which the HHS Secretary determines there
     is an insufficient number of health care practitioners. 

  -- Clinics are allowed only in shortage areas designated within the
     past 3 years. 

  -- Existing clinics that are no longer located in rural shortage
     areas can remain in the program only if they are essential for
     the delivery of primary care that would otherwise be unavailable
     in the area, according to criteria that the HHS Secretary must
     establish in regulations by 1999. 

Limiting payments will help control program costs.  But until, and
depending on how, the Secretary defines the types of areas needing
rural health clinics, HHS will continue to rely on flawed HPSA and
MUA systems that assume providing services to anyone living in a
designated shortage area will improve access to care. 

HHS has been studying changes needed to improve the HPSA and MUA
systems for most of this decade, but no formal proposals have been
published.  In the meantime, new legislation continues to require the
use of these systems, thereby increasing the problem.  For example,
the newly enacted Balanced Budget Act authorizes Medicare to pay for
telehealth services--consultative health services through
telecommunications with a physician or qualifying provider--for
beneficiaries living in rural HPSAs.  However, since HPSA
qualification standards do not distinguish rural communities that are
located near a wide range of specialty providers and facilities from
truly remote frontier areas, there is little assurance that the
provision will benefit those rural residents most in need of
telehealth services. 


--------------------
\11 Under certain circumstances, the ratio used to designate a
primary care HPSA may be 1 to 3,000.  HHS has different criteria for
dental and mental health HPSAs. 

\12 MUAs are designated based on a relative ranking of all U.S. 
counties, minor civil divisions, and census tracts that occurred in
1975 and 1976.  All areas that ranked below the county median
combined score for the four criteria were designated as MUAs.  MUAs
have been added since then on the basis of newer data and the same
cutoff score. 

\13 The act also contains provisions related to quality assurance,
staffing requirements, and payment for physician assistant services. 
In addition, the act allows states to begin limiting the higher
Medicaid payments to rural health clinics starting in fiscal year
2000. 


   IMPLEMENTATION OF THE
   GOVERNMENT PERFORMANCE AND
   RESULTS ACT PROVIDES AN
   OPPORTUNITY TO ADDRESS
   IDENTIFIED PROBLEMS
---------------------------------------------------------- Chapter 0:3

To make the Rural Health Clinic program and other federal programs
more accountable for improving access to primary care, HHS will have
to devise a better management approach to measure need and evaluate
individual program success in meeting this need.  If effectively
implemented, the management approach called for under the Results Act
offers such an opportunity.  Under the Results Act, HHS would ask
some basic questions about its access programs:  What are our goals
and how can we achieve them?  How can we measure our performance? 
How will we use that information to improve program management and
accountability?  These questions would be addressed in annual
performance plans that define each year's goals, link these goals to
agency programs, and contain indicators for measuring progress in
achieving these goals.  Using information on how well programs are
working to improve access in communities, program managers can decide
whether federal intervention has been successful and can be
discontinued, or if other strategies for addressing access barriers
that still exist in communities would provide a more effective
solution. 


      ESTABLISHING
      RESULTS-ORIENTED PERFORMANCE
      GOALS AND MEASURES
-------------------------------------------------------- Chapter 0:3.1

The Results Act provides an opportunity for HHS to make sure its
access programs are on track and to identify how efforts under each
program will fit within the broader access goals.  The Results Act
requires that agencies complete multi-year strategic plans by
September 30, 1997, that describe the agency's overall mission,
long-term goals, and strategies for achieving these goals.\14 Once
these strategic plans are in place, the Results Act requires that for
each fiscal year, beginning fiscal year 1999, agencies prepare annual
performance plans that expand on the strategic plans by establishing
specific performance goals and measures for program activities set
forth in the agencies' budgets.  These goals are to be stated in a
way that identifies the results--or outcomes--that are expected, and
agencies are to measure these outcomes in evaluating program success. 
Establishing performance goals and measures such as the following
could go far to improve accountability in HHS' primary access
programs. 

  -- The Rural Health Clinic program currently tracks the number of
     clinics established, while the Medicare Incentive Payment
     program tracks the number of physicians receiving bonuses and
     dollars spent.  To focus on access outcomes, HHS will need to
     track how these programs have improved access to care for
     Medicare and Medicaid populations or other underserved
     populations. 

  -- Success of the National Health Service Corps and health center
     programs has been based on the number of providers placed or how
     many people they served.  To focus on access outcomes, HHS will
     need to gather the information necessary to report the number of
     people who received care from National Health Service Corps
     providers or at the health centers who were otherwise unable to
     access primary care services available in the community. 

Establishing performance goals will also help clarify how each
program "fits" into HHS' overall portfolio of programs to improve
access to primary care.  HHS has established national outcome-based
goals and objectives for the year 2000 through its Healthy People
2000 initiative,\15 including the objective of increasing the
proportion of Americans with a usual source of primary care from 84
percent in 1994 to 95 percent in the year 2000.  HHS uses the results
from its National Health Interview Survey, an existing survey, to
measure progress toward this goal by counting the number of people
across the nation who do and do not have a usual source of primary
care.  For those people without a usual source of primary care, the
survey categorizes the reasons for this problem that individual
programs may need to address, such as people's inability to pay for
services, their perception that they do not need a physician, or the
lack of provider availability. 

Although HHS officials have started to look at how individual
programs fit under these national goals, they have not yet
established links between the programs and national goals and
measures.  Such links are important so resources can be clearly
focused and directed to achieve the national goals.  For example,
HHS' program description, as published in the Federal Register,
states that the health center programs directly address the Healthy
People 2000 objectives by improving access to preventive and primary
care services for underserved populations.  While HHS' fiscal year
1998 budget documents contain some access-related goals for health
center programs, it also contains other goals, such as creating 3,500
jobs in medically underserved communities.  Although creating jobs
may be a desirable by-product of supporting health center operations,
it is unclear how this employment goal ties to national objectives to
ensure access to care.  Under the Results Act, HHS has an opportunity
to clarify the relationships between its various program goals and
define their relative importance at the program and national levels. 


--------------------
\14 The results of our review of HHS' draft strategic plan can be
found in The Results Act:  Observations on the Department of Health
and Human Services' April 1997 Draft Strategic Plan
(GAO/HEHS-97-173R, July 11, 1997). 

\15 Healthy People 2000 is the U.S.  Public Health Service's national
public health initiative to improve the health of all Americans.  In
consultation with stakeholders, other government agencies, and the
public health community, the Public Health Service developed a series
of outcome-based public health goals and measures. 


      DEVELOPING BETTER
      INFORMATION ON THE
      COST-EFFECTIVENESS OF ITS
      PROGRAMS
-------------------------------------------------------- Chapter 0:3.2

Viewing program performance in light of program costs--such as
establishing a unit cost per output or outcome achieved--can help HHS
and the Congress make informed decisions on the comparative advantage
of continuing current programs.\16 For example, HHS and the Congress
could better determine whether the effects gained through the program
were worth their costs--financial and otherwise--and whether the
current program was superior to alternative strategies for achieving
the same goals.  Unfortunately, in the past, information needed to
answer these questions has been lacking or incomplete, making it
difficult to determine how to get the "biggest bang for the buck."

This is not just a theoretical point.  Our work has shown the value
of analyzing and comparing costs.  For example, our review of the
National Health Service Corps program showed the benefits of using
comparative cost information to allocate resources between its
scholarship and loan repayment programs.  While both of these
programs pay education expenses for health professionals who agree to
work in underserved areas, by law, at least 40 percent of amounts
appropriated each year must fund the scholarship program and the rest
may be allocated at the HHS Secretary's discretion.  However, our
analysis found that the loan repayment program costs the federal
government at least one-fourth less than the scholarship program for
a year of promised service and was more successful in retaining
providers in these communities.  Changing the law to allow greater
use of the loan repayment program would provide greater opportunity
to stretch program dollars and improve provider retention. 
Comparisons between different types of programs may also indicate
areas of greater opportunity to improve access to care.  However, the
per-person cost of improving access to care under each program is
unknown.  Collecting and reporting reliable information on the
cost-effectiveness of HHS programs is critical for HHS and the
Congress to decide how to best spend scarce federal resources. 


--------------------
\16 We previously reported on the type of information needed to
oversee and evaluate federal programs; see Program Evaluation: 
Improving the Flow of Information to the Congress (GAO/PEMD-95-1,
Jan.  30, 1995). 


   CONCLUSION
---------------------------------------------------------- Chapter 0:4

Although the Rural Health Clinic program and other federal programs
help to provide health care services to many people, the magnitude of
federal investment creates a need to hold these programs accountable
for improving access to primary care.  The current HPSA and MUA
systems are not a valid substitute for developing the program
criteria necessary to manage program performance along these lines. 
The management discipline provided under the Results Act offers
direction in improving individual program accountability.  Once it
finalizes its strategic plan, HHS can develop in its annual
performance plans individual program goals for the Rural Health
Clinic program and other programs that are consistent with the
agency's overall access goals, as well as outcome measures that can
be used to track each program's progress in addressing access
barriers. 

This program performance information can assist HHS' operating
divisions, such as the Health Care Financing Administration (HCFA)
and the Health Resources and Services Administration (HRSA), in
better managing its programs toward a common goal.  In addition, this
information can assist in determining whether strategies such as
providing higher Medicare and Medicaid reimbursement rates under the
Rural Health Clinic program are still needed to improve access to
care, or whether directing federal dollars to other strategies, such
as those addressing the inability to pay for services, would have
greater effect in achieving HHS' national primary care access goals. 

Mr.  Chairman, this concludes my prepared statement.  I would be
pleased to respond to any questions you or members of the
Subcommittee may have. 


SELECTED FEDERAL PROGRAMS
ADDRESSING MEDICAL UNDERSERVICE
==================================================== Appendix Appendix

                Overall                         Program
Total FY96      strategy to     Program         strategy used
federal         address cause   (amount of      to address      Agency
funding (in     of              federal         cause of        administering
millions)       underservice    funding)        underservice    program
--------------  --------------  --------------  --------------  ----------------
$514            Providing       Rural Health    Pay higher      HCFA
                incentives to   Clinic          Medicare and
                health          ($295)\a        Medicaid rates
                professionals                   to physicians
                in underserved                  and
                areas                           nonphysicians
                                                in underserved  HCFA
                                Medicare        areas
                                Incentive Pay
                                ($107)          Provide 10%
                                                bonus on
                                                Medicare        HRSA and states
                                                payments to
                                National        all physicians
                                Health Service  in shortage
                                Corps ($112)    areas           Multiple federal
                                                                agencies and
                                                Pay education   states
                                J-1 Visa        costs of
                                Waiver ($0)     providers
                                                agreeing to
                                                locate in
                                                shortage
                                                areas

                                                Allow foreign
                                                physicians
                                                (exchange-
                                                visitors) to
                                                remain in the
                                                U.S. if they
                                                practice in
                                                shortage areas

$758+           Paying clinics  Health Centers  Subsidize       HRSA
                and providers   Grants\b        certain
                caring for      ($758)          providers
                people unable                   willing to see
                to pay                          patients
                                                regardless of   HCFA
                                Federally       their ability
                                Qualified       to pay
                                Health
                                Center\c        Higher
                                                Medicare and
                                                Medicaid
                                                payments to
                                                certain
                                                providers
                                                willing to see
                                                patients
                                                regardless of
                                                their ability
                                                to pay

$238            Paying          Title VII/      Pay health      HRSA
                institutions    VIII Health     professions
                to support      Education and   schools to
                education and   Training        support
                training of     Programs\d      training of
                health          ($238)          health
                professionals                   professionals
--------------------------------------------------------------------------------
\a Estimated additional cost to Medicare and Medicaid programs due to
higher payment rates to rural health clinics. 

\b Includes four health center programs:  Community, Migrant,
Homeless, and Residents of Public Housing.  Prior to the Health
Center Consolidation Act of 1996 (P.L.  104-299, Oct.  11, 1996),
these programs were authorized under sections 329, 330, 340, and 340A
of the Public Health Service Act. 

\c Includes health center grantees, as well as health centers that
qualify for a federal grant but do not receive one.  Medicare and
Medicaid costs associated with this program are unknown. 

\d Includes 30 programs for increasing the supply, distribution, and
minority representation of health professionals. 


*** End of document. ***