oversight

Opportunities for Improving the Neighborhood Health Services Program for the Poor Administered by St. Luke's Hospital Center, New York City

Published by the Government Accountability Office on 1971-06-15.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                    0 THE CONGRESS
                                 lllllllllrlllllllllllllllllll
                                       LM095628




Office of Economic Opportunity




             TROLLER GENERAL
OF THE UNITED STATES
                CX3MPTWOLLEW     GENERAL     OF      THE      UPdlTEB    STATES
                               WASHINGTON.    D.C.         20948




B-130515




                                                                                  -, i,
To the     President      of the Senate     and the                                I
Speaker      of the    House   of Representatives

         This is our report      on opportunities         for                     improving
the Neighborhood        Health   Services      Program                         for the poor
administered       by St. Luke’s    Hospital      Center,                       New York
City.     Our review    was made pursuant           to the                      Budget      and
Accounting     Act,   1921 (31 U.S.C.       53), and the                        Accounting
and Auditing      Act of 1950 (31 U.S.C.         67).

         Copies    of this     report     are being    sent to the Director,
Office    of Management           and Budget;      the Director,      Office    of
Economic       Opportunity;           and the Secretary       of Health,     Edu-
cation,    and Welfare.




                                                       Comptroller                 General
                                                       of the United               States




                       50TH    ANNIVERSARY                  1921-       1971
COMPTROLLERGENERAL'S                                OPPORTUNITIES FOR IMPROVING THE
REPORTTO THE CONGARESS                              NEIGHBORHOOD HEALTH SERVICES PROGRAM FOR
                                                    THE POOR ADMINISTERED BY ST. LUKE'S
                                                    HOSPITAL CENTER, NEW YORK CITY
                                                    Office  of Economic Opportunity B-130515


DIGEST
------
WHYTHE REVIEW WASMADE

       The Comprehensive      Health    Services  Program is intended         to find ways
       to break the cycle       in which sickness      and poverty    reinforce       and per-
       petuate  each other.        This is a grant-in-aid      program     authorized     under
       the Economic    Opportunity      Act.

       Under this  program,    the Office   of Economic     Opportunity     (OEO) makes
       grants  to public    or pri vate nonprofit   agencies     for prbjects'attempt-
       ing to demonstrate     new ways to provide    health    services     to the poor.

       Funding    of the program     and changes            in   administrative        responsibility
       since   its inception    fo 1 low.

             --For   fiscal   years    1 9 65 through    1970, OEO had obligated       about
                $220 million.       For fiscal      year 1971, $99 million     additional               had
                been authorized.

             --In   December 1970 responsibility         for 16 of 66 operational     projects
                 was transferred     from OEO to the Department      of Health,   Education,
                 and Welfare     (HEW) which was to provide     up to $30 million     in fiscal
                year 1971 to support       those projects.

       The General    Accounting  Office    (GAO) is making a series     of reviews   to
       determine   (1) the extent     to which the objectives    of this   program   are
       being met and (2) how efficiently        the program   is being administered.                                     .~d

       This report        presents    GAO's findings            on the Neighborhood
                                                                          -1* ,&I"""..i'      Health    Services
       Program_* a project          administered         by St. Luke's        Hospital      Center    in New
       Ymty.             The project        seeks to demonstrate             how the resources          and ca-
       pabilities       of a major      teaching       hospital    --St.     Luke's--and       a large     city
       health     department--      New York City's--can             be combined         to pr&~j&,cpmp.re-
       heen~ive,     high-quality,        family-oriented          health     services      to a group of
       approximately         20,000   poor persons.

       From June 1967, when the project     was approved      by OEO, through                        Octo-
       ber 31, 1970, OEO had made grants      totaling    about $3.8 million                         for
       operation of the project.    An additional      grant   of about $1.4                        million
       has been approved  by OEO for the project       for the year ending                          October        31,
       1971.


Tear Sheet
FINDINGS AND CONCLUSIONS

    The project began serving patients in December 1967. By Narch 1970 the
    project had reached (or enrolled)       about 10,000 persons, or about half of
    its goal.     The project had provided health and health-related      care to
    these persons at the project site, at St. Luke's, and in their homes.
    In interviews     with a member from each of 50 enrolled families     selected
    on a systematic basis, GAO found that the individuals        generally were
    satisfied    with the project's   services.   Also the project had succeeded
    in involving     neighborhood residents in its planning and operation.

    Because of a number of problems, however, GAO believes that the project
    has not yet provided a significantly   better health care delivery     system
    than that which previously   existed.  OEO and project officials     have al-
    ready recognized and are working to correct many of these problems.
    The need to refer many patients to the outpatient    clinics   at St. Luke's--
    in essence, returning the patient to the system which project proposals
    have described as impersonal and institutionalized    and which the OEO
    program is attempting to overcome --is a significant    weakness in the proj-
    ect's operation.    (See p. 14.)
    The amount of space available    to the project--about 8,000 square feet
    on the second floor of a three-story    city health department facility--
    limited   the range of services that could be offered at the project site.
    A formal agreement for use of the space had not been executed with the
    city.    Because there was no formal agreement, OEO denied approval of
    renovations necessary to accommodate certain equipment.     Continued avail-
    ability   of the space is uncertain.   (See p. 19.)
    The relatively    low average number of patients seen by project physicians
    and dentists--g.5    and 5.7 a day, respectively,    during the 8-month period
    ended February 28, 1970--indicated     that the project was not making maxi-
    mum use of available    professional  staff members. OEO guidelines     sug-
    gest that, with adequate space, a physician should treat about 28
    patients and a dentist about 14 patients a day. Project officials         at-
    tributed   the problem, in part, to the number of appointments missed by
    patients and to the inadequate space which limited        the number of ex-
    amining rooms available     to each physician.    (See p. 23.)
    Other improvements are needed if the project is to fully achieve the
    objectives  of the Comprehensive Health Services Program which is de-
    signed to overcome the shortcomings of the existing    health care system
    for the poor. The existing   system, according to OEO guidelines,     offers
    services widely recognized to be insufficient   and often inaccessible,
    impersonal, fragmented, lacking in continuity,   and of poor quality.

    Assisted by medical   specialists       from the U.S. Public   Health Service,   I
    GAO found that:

      --Although patients were generally treated by the same physicians
        when they visited  the project site for medical care, such continuity
         often was lost when patients were admitted to St. Luke's for inpatient


                                        2
                           care.   This situation      occurred  because                 about half   the project's    phy-
                           sicians  did not have hospital       privileges                  at St. Luke's,   the grantee
                           and administering      agency of the project.                      (See p. 25.)

                         --The project         generally     provided  individually     oriented         rather     than
                            family-oriented         health    care.   OEO guidelines     call      for a project's
                            staff     to attempt       to see the patient      in his family       setting       when ap-
                            propriate       and for all members of a family           to be seen by the same
                            physician       or team of physicians        to the extent      feasible.           (See p. 27.)

                         --The project     made some progress      in implementing     a program     to provide
                            comprehensive     health care,  including      preventive   care,    but additional
                            efforts    need to be made and additional         space needs to be acquired
                            if the project     is to fully  achieve    such a program.        (See p. 29.)

                   The project      made free medical      services       available,       in some instances,            to
                   persons    who did not meet OEO-approved             eligib-ility       criteria      and, in other
                   instances,      to persons    whose eligibility          had not been clearly            established.
                   The project       needed to strengthen         its controls       over eligibility          deter-
                   minations     to ensure    that   OEO funds are used to provide                  care for those
                   persons    whom the program       is designed      to help.         (See p. 34.)

                   Corrective     action    was taken,   or             promised,   by OEO to improve                        certain    as-
                   pects of the management         of grant              funds which GAO brought     to                      its atten-
                   tion.      (See p. 38.).

I
I           RECOMc'ENRATIONS
                           OR SUGGESTIONS

                   The Director           of    OEO, through      OEO's      Office     of   Health         Affairs,            should:

                         --Request      St. Luke's     and project            officials    to bring    negotiations                        with
                            the city     for additional     space           to a satisfactory       conclusion      or,                    as
                            an alternative,       to seek other             suitable    space.     (See p. 21.)

                         --Review   the project's    professional                 staffing     organization        and deter-
                            mine actions   necessary    to increase                the staff's       productivity.         (See
                            p. 24.)

                         --Work with project      and St. Luke's                officials         to      obtain        hospital          priv;
                            ileges  for all  project   physicians.                    (See   p.        32.)

                         --Stress    to project      officials  the importance      of projiding                              family-
                            oriented    health    care and implementing      procedures     that                          will     aid      such
                            an approach.        (See p. 32.)

    I                    --Reemphasize          to project  officials           the need to expand preventive                               health
    I
    I                       care services         and to educate      the       poor to seek such care.      (See                           p* 32.)
    I
    I                    --Require        the   project     to strengthen         its   controls           over        eligibility            de-
    I                       terminations.            (See   p. 36.)
    I
    I
    I       Tear Sheet
        I
        I
        I                                                           3
    GAO's recorrrnlendations should also be of interest  to the Secretary of-
    HEW because HEWmakes grants for similar     projects under section 314(e)
    of the Public Health Services Act, as amended (42 U.S.C. 246), and be-
    cause 16 of OEO's projects were transferred     to HEWin December 1970.


AGENCYACTIONS AND UNRESOLVEDISSUES

    OEO stated that it was in agreement with each of GAO's recommendations
    and described actions which had been, or would be, taken to effect the                             I
    needed improvements.  (See app. II.)
                                                                                                   I

    HEWtold   GAO that:

         I'*** this report reveals an excellent  understanding of the
         philosophy,   purposes, and design of neighborhood health cen-
         ters.    The report's recommendations are well-taken."   (See
         app. III.)


MATTERS FOR CONSIDERATIONBY THE CONGRESS                                                          I
                                                                                                   I
                                                                                                  I
     The matters presented in this report are for consideration      by   congres-                I
     sional committees having responsibility     for federally assisted     anti-              I
                                                                                               I
     poverty and health services programs.     In view of the interest      shown              I
     by members of the Congress in these programs, GAO is bringing        its                  I
                                                                                              I
   - findings and observations  to the attention    of the Congress for     infor-            I
     mation purposes.                                                                         I
                                                                                              I
                                                                                              I
                                                                                              I
                                                                                             I
                                                                                             I
                                                                                             I
                                                                                             I
                                                                                             I
                                                                                              I
                                                                                              I
                                                                                              I
                                                                                             I
                                                                                             I
                                                                                             I




                                                                                         I
                                                                                         I

                                                                                         ;
                                                                                         I
                                                                                         !
                                                                                     I
                                                                                      I
                                                                                      I
                                                                                      I
                                                                                      I
                                                                                      I
                                                                                     I
                                                                                     I
                                   4                                                 I
                                                                                     I
                                                                                     I
                                                                                     I
                           Contents
                                                                       Page

DIGEST                                                                   1

CHAPTER

           INTRODUCTION
               Comprehensive Health Services Program
               OEO program administration
               Neighborhood Health Services Program

           IMPROVEMENTSNEEDED TO HAVE THE PROJECT
           FULLY MEET PROGRAMOBJECTIVES                                 14
               Impact of the project                                    15
               Need for additional      project     space and
                 assurance that it will         continue    to be
                 available                                              19
                    Recommendation to the Director            of OEO    21
               Productivity     of project's     professional
                 staff    should be reviewed                            23
                    Recommendation to the Director            of OEO    24
               Improvements needed in certain           services
                 and program elements                                   24
                    Conclusion                                          31
                    Recommendations to the Director             of
                       OEO                                              32

           IMPROVEMENTSNEEDED IN PROJECT ADMINISTRATION                 34
               Controls  over eligibility determinations
                 should be strengthened                                 34
                    Recommendation to the Director    of OEO            36
               Needed improvements made or promised in
                 management of grant funds                              38

           SCOPE OF REVIEW                                              43

APPENDIX

   I       OEO-funded comprehensive  health        services
             projects in New York City                                  47

   II      Letter   dated March 17, 1971, from the Deputy
             Director,   Office of Economic Opportunity,
              to the General Accounting  Office                         45
                                                                           Page
     APPENDIX

        III     Letter     dated February 19, 1971, from chc As-
                   sistant     Secretary,    Comptroller,     Department
                  of Health,      Education,      and Welfare,   to the
                   General Accounting        Office                         53
.*
       IV       Principal     officials     of the Office     of Eco-
                   nomic Opportunity       responsible     for the ad-
                  ministration        of activities    discussed in
                   this report                                             54


                                  ABBREVIATIONS

     GAO        General    Accounting   Office

     HEW        Department    of Health,    Education,    and :Yelfare

     OEO        Office    of Economic Opportunity
COMPTROLLERGl?,t@RAL
                   'S                               OPPORTUNITIES FOR IMPROVIidG THE
REPORTTO THE CCMGRESS                               NEIGHBORHOOD HEALTH SERVICES PROGRAM FOR
                                                    THE POOR ADMINISTERED BY ST. LUKE'S
                                                    HOSPITAL CENTER, NEW YORK CITY
                                                    Office  of Economic Opportunity  B-130515


--DIGEST
      ----

WHYTHE REVIEW WASMADE

        The Comprehensive      Health    Services  Program   is intended       to find ways
        to break the cycle       in which sickness      and poverty    reinforce       and per-
        petuate  each other.        This is a grant-in-aid      program     authorized     under
        the Economic    Opportunity      Act.

        Under this  program,    the Office     of Economic     Opportunity     (OEO) makes
        grants  to public    or private    nonprofit   agencies     for projects     attempt-
        ing to demonstrate     new ways to provide      health    services     to the poor.

        Funding    of the program     and changes           in   administrative       responsibility
        since   its inception    follow.

             --For   fiscal   years    1965 through    1970, OEO had obligated       about
                $220 million.       For fiscal    year 1971, $99 million     additional                had
                been authorized.

             --In    December    1970 responsibility     for 16 of 66 operational     projects
                 was transferred     from OEO to the Department      of Health,   Education,
                 and Welfare     (HEW) which was to provide     up to $30 million     in fiscal
                 year 1971 to support      those projects.

        The General    Accounting  Office    (GAO) is making a series     of reviews    to
        determine   (1) the extent     to which the objectives    of this   program   are
        being met and (2) how efficiently        the program   is being administered.

        This report        presents    GAO's findings           on the Neighborhood          Health    Services
        Prograrfl,    a project      administered         by St. Luke's       Hospital     Center    in New
        York City.         The project       seeks to demonstrate            how the resources         and ca-
        pabilities       of a major teaching            hospital--St.        Luke's--and      a large     city
        health     department--New         York City's      --can      be combined      to provide     compre-
        hensive,      high-quality,        family-oriented            health  services     to a group of
        approximately         20,000    poor persons.

        From June 1967, when the project      was approved      by OEO, through                     Octo-
        ber 31, 1970, OEO had made grants       totaling    about $3.8 million                      for
        operation  of the project.    An additional      grant   of about $1.4                     million
        has been approved   by OEO for the project       for the year ending                       October        31,
        1971.




                                                    1
    The project       began serving       patients       in December 1967.           By iqarch 1970 the
    project    had reached         (or enrolled)       about 10,000       persons,      or about    half of
    its goal.      The project         had provided        health    and health-related        care to
    these persons        at the project        site,     at St. Luke's,       and in their       homes.
    In interviews       with a member from each of 50 enrolled                     families    selected
    on a systematic         basis,    GAO found that          the individuals        generally    were
    satisfied     with the project's           services.         Also the project         had succeeded
    in involving       neighborhood       residents        in its planning       and operation.

    Because of a number of problems,                    however,    GAO believes        that    the project
    has not yet provided            a significantly          better     health   care delivery          system
    than that which previously               existed.        OEO and project        officials        have al-
    ready recognized          and are working           to correct      many of these problems.
    The need to refer           many patients         to the outpatient        clinics        at St. Luke's--
    in essence,       returning      the patient          to the system which project               proposals
    have described         as impersonal        and institutionalized            and which the OEO
    program    is attempting         to overcome --is          a significant       weakness       in the proj-
    ect's   operation.          (See p. 14.)

    The amount of space available              to the project--about            8,000 square         feet
    on the second floor           of a three-story      city    health     department     facility--
    limited     the range of services          that  could     be offered       at the project           site.
    A formal      agreement     for use of the space had not been executed                   with the
    city.      Because there       was no formal     agreement,        OEO denied     approval         of
    renovations       necessary     to accommodate      certain      equipment.       Continued          avail-
    ability     of the space is uncertain.             (See p. 19.)

    The relatively       low average      number of patients          seen by project             physicians
    and dentists--g.5       and 5.7 a day, respectively,               during       the 8-month         period
    ended February       28, 1970--indicated         that    the project        was not making maxi-
    mum use of available        professional       staff    members.        OEO guidelines            sug-
    gest that,      with adequate      space,    a physician      should      treat     about 28
    patients     and a dentist      about 14 patients          a day.     Project       officials         at-
    tributed     the problem,     in part,     to the number of appointments                   missed by
    patients     and to the inadequate         space which limited            the number of ex-
I   amining    rooms available       to each physician.            (See p. 23.)

    Other improvements          are needed if the project               is to fully          achieve     the
    objectives      of the Comprehensive             Health    Services       Program which          is de-
    signed     to overcome       the shortcomings          of the existing          health      care system
    for the poor.          The existing        system,     according      to OEO guidelines,             offers
    services     widely     recognized       to be insufficient           and often        inaccessible,
    impersonal,       fragmented,       lacking      in continuity,         and of poor quality.

    Assisted  by medical           specialists        from   the   U.S.    Public     Health     Service,
    GAO found  that:

       --Although    patients  were generally       treated   by the same physicians
          when they visited    the project     site     for medical  care,  such continuity
          often   was lost when patients      were admitted      to St. Luke's  for inpatient



                                                  2
          care.   This situation      occurred  because                about    half the project's    phy-
          sicians  did not have hospital       privileges                 at St. Luke's,    the grantee
          and administering      agency of the project.                     (See p. 25.)

       --The project         generally     provided  individually     oriented        rather     than
          family-oriented         health    care.   OEO guidelines     call     for a project's
          staff     to attempt       to see the patient      in his family      setting       when ap-
          propriate       and for all members of a family           to be seen by the same
          physician       or team of physicians        to the extent      feasible.          (See p. 27.)

       --The project     made some progress      in implementing     a program     to provide
          comprehensive     health care,  including      preventive   care,    but additional
          efforts    need to be made and additional         space needs to be acquired
          if the project     is to fully  achieve    such a program.        (See p. 29.)

    The project      made free medical      services         available,      in some instances,            to
    persons    who did not meet OEO-approved               eligibility       criteria      and, in other
    instances,      to persons    whose eligibility            had not been clearly           established.
    The project       needed to strengthen         its controls         over eligibility         deter-
    minations     to ensure    that   OEO funds       are used to provide             care for those
    persons    whom the program       is designed        to help.        (See p. 34.)

    Corrective     action   was taken,   or           promised,   by OEO to improve                 certain    as-
    pects of the management        of grant            funds which GAO brought     to               its atten-
    tion.      (See p. 38.)


RECOMk'EflDATIONS
                OR SUGGESTIONS

    The Director        of OEO, through         OEO's      Office     of Health    Affairs,            should:

       --Request      St. Luke's      and project           officials    to bring     negotiations                with
          the city      for additional     space          to a satisfactory        conclusion      or,            as
          an alternative,        to seek other            suitable    space.      (See p. 21.)

       --Review   the project's    professional                 staffing      organization        and deter-
          mine actions   necessary    to increase                 the staff's       productivity.        (See
          p. 24.)

       --Work with project     and St. Luke's                 officials      to obtain         hospital          priv;
          ileges  for all project   physicians.                     (See   p. 32.)

       --Stress    to project       officials  the importance      of providing                      family-
          oriented    health     care and implementing      procedures     that                  will     aid      such
          an approach.        (See p. 32.)

       --Reemphasize    to project  officials                  the need to expand preventive                       health
          care services   and to educate      the              poor to seek such care.      (See                   p. 32.)

       --Require        the   project     to strengthen         its   controls     over       eligibility            de-
          terminations.            (See   p. 36.)



                                                  3
    GAO's recommendations shoull:i a Iso be of interest   to the Secretary of
    HEWbecause Ml makes grants for similar projects under section         374(e)
    of the Public Wealth Services Act, as amended (42 U.S.C. 246), and be-
    cause 16 of OEQ's projects were transferred      to HEW in December 1970.


AGENCY
     ACTIONSANDUNRESOLVED
                       ISSUES
    OEO stated that it was in agreement with each of GAO's recommendations
    and described actions which had been, or would be, taken to effect the
    needed improvements.  (See app, II.)

    HEWtold   GAO that:

         I'*** this report reveals an excellent  understanding of the
         philosophy,   purposes and design of neighborhood health cen-
         ters.    The report's Recommendations are well-taken."  (See
         app. III.)


MATTERS
      FORCONSIDERATION
                    BY THE CONGRESS

    The matters presented in this report are for consideration       by   congres-
    sional committees having responsibi7ity    for federally assisted      anti-
    poverty and health services programs.    In view of the interest        shown
    by members of the Congress in these programs 3 GAO is bringing        its
    findings and observations to the attention    of the Congress for      infor-
    mation purposes.




                                   4
                                      CHAPTER 1


                                   INTRODUCTION

       We reviewed       the operations       of the Neighborhood            Health
Services     Program,      a project     administered      by   St.  Luke’s      Hos-
pital    Center    in New York City and financed              with   grants      by
the Office      of Economic       Opportunity      under the Comprehensive
Health    Services      Program.     OEO’s grant       for the project’s
first    year was awarded to New York City’s                Community        Devel-
opment Agency,        the city’s     designated       community     action
agency.      Subsequent      grants    have been made directly             to
St. Luke’s.

        Our review       was directed         toward     evaluating       the extent
to which program objectives                 had been met and the efficiency
of the administration              of the project.           We were assisted          by
medical     specialists         from the U.S. Public             Health     Service,
Department        of Health,       Education,       and Welfare,         who evaluated
the quality         of medical       care provided        by the project          and the
adequacy     of patient        medical      records.        Our review       covered
operations        of the project         from its      inception       in June 1967
through     April      1970 and was supplemented               by certain       informa-
tion    developed       thereafter.

        On December 23, 1970, we requested            the comments of the
Director    of OEO, the Secretary        of HEW, and the grantee         on
the matters     discussed     in this  report.       By letter   dated
March 17, 1971, the Deputy Director              of OEO provided     us with
OEO’s views.        The Deputy Director       stated    that OEO had re-
ceived    and reviewed     the comments of the project         and
St. Luke’s     staffs,    some of which were incorporated           into  the
OEO comments.

       The Assistant         Secretary,      Comptroller,       of    HEW, by let-
ter   dated February         19, 1971,      provided      us with     HEW’s views.

       The OEO and HEW letters       are included   as appendixes    II
and III,   respectively,      and comments contained     therein  or
attached   thereto      have been included    in the body of the re-
port where appropriate.
       The Compreh<snsive        Health   Services     Program,     which is
intende\l    to fired ways to break the cycle             in which sickness
and pave rt) reinforce          and perpetuate      each other,       is autho-
rized     as a specific       component   of OEC)*s Community        Action
Program by the 1966 amendments              to the Economic        Opportunity
Act of 1964 (42 1J.S.C. 2701) 0 In authorizing                   the program
the Congress       broadened     the neighborhood       health     center     con-
cept which had been supported             by OEO in 1965 and early               in
1966 under     its    authority     to finance     demonstration        projects
designed     to test     or assist     in the development        of new ap-
proaches     or methods       to combat poverty      through     community         ac-
tion.

       In its  report  on the 1966 amendments,       the Senate Com-
mittee   on Labor and Public    Welfare    indicated    its concern
for the manner in which health        care for the poor had been
provided    in the past by stating:

        “Differential            rates     of disease,          disability        and
       premature          death between the poor and the rest                           of
        the population             are the result,           at least         in part,
        of the inadequate              health    services          received       by the
       poor e We have found that                   for the poor? health
        care is emergency              care.     Health         is not a continu-
       ous and integral               part of their          life.         Moreover,
       the care they have received                     has typically            been
       devoid       of a patient-physician                relationship.              They
       seldom see the same physician                       twice      and there         is
       little       recognition          of the total           health      needs of
       a family.            Health     services      for the poor are usu-
       ally     rendered         in depressing         physical          surround-
       ings 9     far     from     home   or  place      of    work,       marked by
       hours of waiting               and devoid       of concern           for the pa-
       tient’s        privacy       and dignity.          This situation             is
       aggravated           by the fact       that medical            care programs
       for the poor are fragmented                    and complex             and dis-
       courage        the patient         who suffers          basic       education
       and cultural            impediments.”

        The Committee 9 concluding     that the neighborhood     health
centers    started    by OEO had proven    to be highly  successful
devices    in delivering    effective   health  service  to the poorF,
stated:


                                               6
       ‘I*** Under one roof in one neighborhood                       a compre-
       hensive     health     center    provides       the broadest        pos-
       sible    scope of ambulatory           health      services      for the
       poor.      The Neighborhood         Health     Center      is creating
       an altogether        new relationship          between       the pro-
       vider    and recipient        of health       services,       making
       services      truly    responsive      to the neighborhood’s
       needs.      These centers        provide      a continuous         doctor-
       patient     relationship,        in a place        that   is acces-
       sible    to those being         served by the center,              and in
       a climate       of dignity.”

The Committee        stated     that  the amendment authorizing                  the
program would        enable     OEO to build   on and expand its                 early
demonstration        efforts.

        Section    222(a)(4)      of the act,        as amended, which autho-
rizes     the Comprehensive         Health     Service    Program,    states
that    the program        is to aid in developing           and carrying      out
projects      focused      on the needs of urban and rural              areas hav-
ing high concentrations             or proportions        of poverty     and
marked inadequacy            of health    services     for the poor.         The
projects      are to be designed          to make possible,        with maximum
feasible      use of existing         agencies     and resources,       the provi-
sion of comprehensive            health     services     together    with neces-
sary related       facilities       and services.

         The act states          that     comprehensive       health      services      are
to include        preventive          medical,    diagnostic,        treatment,       re-
habilitation,          family      planning,      narcotic     addiction        and alco-
holism      prevention        and rehabilitation,            mental     health,     dental,
and follow-up          services.          In rural     areas which lack elemental
health      services      and personnel,           less comprehensive           services
may be established             first.

        Program services            also are to be made readily             accessible
to low-income         residents        of the area and are to be furnished
in a manner most responsive                 to their       needs and with      their
participation.            Services       may be made available          to all    resi-
dents of an area on an emergency                     basis    or pending    a deter-
mination       of eligibility.            Wherever     possible,     the services
are to be combined             with,     or included       within,   arrangements
for providing         employment,         education,       social,   or other     as-
sistance       needed by the families             and individuals         served.



                                              7
        Before    any project       is approved,        the comments and rec-
ommendations       of medical       associations        in the area are re-
quired     to be solicited         and considered         and appropriate       Fed-
eral s State 9 and local          health      agencies     are to be consulted,
Also steps are to be taken to ensure that                      the projects      are
carried      on under competent          professional       supervision      and
that    existing      agencies    providing       related     services    are fur-
nished     with   all   assistance       needed to permit          them to plan
for participation          in the program         and for the necessary          con-
tinuation       of the related        services.

         As of December 13, 1970, OEO funded 66 comprehensive
health     services     projects,      of which 47 were in urban areas
and 19 in rural         areas,     and provided       planning    grants       for an
additional       17 projects.         The projects        then either      fully   or
partially      operational        were estimated        to have registered
over 650,000        persons;      when fully      operational,      the projects
are expected        to serve over a million            persons.       Effective
December 14, 1970, the responsibility                     for 16 of OEO’s oper-
ational     projects     was transferred          from OEO to HEW in accor-
dance with a Presidential              directive.

        From fiscal       year 1965, when the first        OEO health    ser-
vices    projects     were funded as research         and demonstration       ef-
forts,     through    June 30, 1970, OEO obligations           for the pro-
gram totaled       about $220 million.         For fiscal     year 1971,
$99 million       additional      has been authorized      for the program.
HEW is to provide          up to $30 million      for fiscal    year 1971 to
support      the projects      transferred   to it.

OEO PROGRAM ADMINISTRATION

        The Director       of OEO is responsible             for the administra-
tion    and coordination           of the activities         authorized        by the
Economic     Opportunity         Act of 1964, as amended.               He is re-
sponsible     also for the establishment                 of basic     policies      gov-
erning     OEO operations          and programs        and for the planning,
direction,      control,       and evaluation          of OEO programs.           The
Office     of Health      Affairs,       a  part    of  OEO’s   headquarters        or-
ganization,      is responsible            for directing       and coordinating
the conduct      of all      OEO activities          concerned    with     health
and medical      affairs,        including       the Comprehensive         Health
Services     Program.




                                            8
NEIGHBORHOOD HEALTH SERVICES                 PROGRAM

        The project        sponsored   and administered by St. Luke’s
Hospital      Center     is one of seven comprehensive     health ser-
vices    projects      that have been funded by OEO in New York
City.     The seven projects,          none of which are among the 16
projects      transferred        from OEO to HEW in December 1970, are
listed     in appendix        I.

         The project      was funded by OEO to demonstrate             how the
resources       and capabilities        of a major teaching        hospital--
St. Luke’s--and          a large  city    health    department--New        York
City’s--could         be combined     to provide     comprehensive,        high-
quality,      family-oriented       health    services     to a target       popu-
lation     of approximately       20,000 poor persons.

         The origin        of the project     can be traced          to 1962 when
St. Luke’s,          which is affiliated        with    the Columbia        University
College       of Physicians        and Surgeons,      decided      to cooperate
with     the New York City Health            Department      to support        the
then-new        clinical     programs    at the city’s       Riverside       Health
Center      located       about 13 blocks     from St. Luke’s.            These
clinical       programs s according        to the initial          proposal       for
the project,           did not offer     comprehensive        family     health       ser-
vices,      but rather        they offered    isolated,       individual        clinical
services.

       With the passage of 1966 amendments                to the Economic
Opportunity      Act which first       authorized      the Comprehensive
Health    Services     Program,    the city     health    department      invited
St. Luke’s      to participate       in expanding      the clinical       programs
at the Riverside         Health   Center   into    a comprehensive        family
program.      A   neighborhood     health    council,     formed    early     in
1967, aided St. Luke’s          in preparing       the initial      project      pro-
posal e

         During     the early-1967       period,     OEO dealt     with     three
city     organizations--the          Health    Services     Administration,           the
Council      Against      Poverty,     and the Human Resources            Adminis-
tration’s        Community      Development      Agency--in    launching         its
health      services      program    in New York City.         The Health          Ser-
vices     Administration         is responsible       for health-related             ac-
tivities       in the city.




                                              9
        The Council        Against        Poverty,   a Sl-member      board ap-
pointed      by the mayor,           determines    the priorities         of the var-
ious antipoverty            programs        in the city     and gives     overall      pal-
icy direction          to these programs.            The Council      consists      of
17 public      officials;          nine representatives          of citywide       edu-
cation 9 social          service,       religious,     labor,    and business       or-
ganizations;         and    25   representatives         from  the  city’s      desig-
nated poverty         areas.

       The Human Resources            Administration         is responsible          for
the city’s      efforts      to help welfare         recipients,          unemployed
persons,    drug addicts,          youths,      and communities           solve   prob-
lems in education,           health,     and welfare.          The Administration’s
Community     Development        Agency,      the city’s       officially       desig-
nated community         action     agency,      is authorized         to receive
funds from OEO and to carry                out the Council          Against     Poverty’s
policy    decisions.

        Early     in 1967, the proposals             for OEO-funded      health     ser-
vices     projects,        which were submitted          by interested      sponsors,
were reviewed          by the Health      Services       Administration       to eval-
uate the level           of medical    service       proposed     and by the Com-
munity      Development        Agency and the Council           Against   Poverty
to evaluate         the extent      of poverty       in the area designated          by
each proposal,           the expressed      interest      of the community        in
participating          in the program,        and the availability         of hos-
pital     services       in the area.      The proposals          were then sub-
mitted      to OEO which approved           those that       it found acceptable.
This project         was one of those approved             by OEO.

       During  the project’s       initial     program period--June     1967
to November 1968--the         Community      Development    Agency was the
grantee    for the project      and St. Luke’s,        which had sponsored
the project,     administered     it as a delegate         agency.  Subse -
quent grants     for the project         have been made by OEO directly
to st. Lukess.

      The following          schedule    shows the        amounts approved           and
funded by OEO for          the project’s      first       4 program years.




                                             10
                                                          Amount
Program                                                      Funded by OEO
 year
 --             Period    covered            Approved          (note a)

    1          6-16-67    to 6-1568b         $1,139,403        $   939,403
    2        ll- l-68     to 10-31-69         1,802,239         1,552,239
    3        ll- l-69     to 10-31-70         1,657,085         1,346,085'
    4        ll- l-70     to 10-31-71         2,165,524         1,365,524d

aDifferences    between the OEO-approved and OEO-funded amounts
 result    from anticipated program revenue, such as Medicare
 and Medicaid reimbursements.
b Extended  to November 30, 1968.   For the month of November
 1968, the first   and second grants overlapped  and ran con-
 currently.

'Includes    $478,019     available    from prior    program    year.
d Includes   $65,929     available    from prior    program    year.

       The project's     target    area is in the West Side of Man-
hattan (see map on the following              page) bounded by West
85th Street,     Central Park West, West 110th Street,               and the
Hudson River,        The project's     offices     are located on the
second floor     of the three-floor         Riverside   Health Center
which is approximately         in the center of the target           area.
The remainder of the building            is used by the city health
department    to provide various         city-sponsored     health ser-
vices,   such as chest X-rays,         family planning       services,     pub-
lic health nursing services,           school dental services,          child
health examinations,        immunizations,       and social hygiene ser-
vices.

        St. Luke's initial        project     proposal     stated that in
1960 approximately         140,000 persons lived within             the target
area in economic and social             situations     which ranged from
abject,     grinding    poverty    to relative      affluence     and moderate
wealth.      The proposal      stated also that 60,000 of these per-
sons constituted        the poverty population           to which the proj-
ect would be directed         and that a patient           enrollment   of ap-
proximately       20,000 persons from this group was anticipated
when the project        was fully     operational.




                                        11
TARGET   AREA OF NEIGHBORHOOD
HEALTH   SERVICES PROGRAM




                12
      Data obtained    from city      health      department      records
showed that,    from 1960, the total           population      of the target
area had decreased.       Also,    project      officials      have informed
us and we have observed        that portions          of the   target     area
have undergone,     or are scheduled         to undergo,       redevelopment
as part   of an urban renewal       program.

      As of September          30, 1969, the project       had 108 full-
time employees       including       seven physicians.      An additional
10 physicians      and three dentists         worked on a part-time          ba-
sis at the project         at that      time.  As of September        30, 1970,
the project’s      staff     had been increased        to 130 full-time
employees,    including        10 physicians     and one dentist,        and
12 part-time     employees,        of whom nine were physicians           and
three were dentists.
                                                  CHAPTER - 2


                         IMPROVEMENTS NEEDED TO HAVE THE PROJECT

                                   FULLY MEET PROGRAM OBJECTIVES

                During       its   first   3 program            years,    the   project        had

 ‘M             --enrolled         about   half     of    its      intended     target       popula-
                   tion;
  I(
                --permitted        low-income     persons  needing  medical   and
                   other    health      care to be served     at the project     site,
 .i
                   at the sponsoring          hospital,   and in their    homes;

                --provided    medical     services               that    generally        satisfied
                   its enrollees;     and

                --generally           succeeded  in involving     target-area                   resi-
                   dents in         its planning   and operation.

“1111           Because of a number of problems,                  however,     which OEO and
        project     officials         have recognized        and are working         to correct,
        we believe        that the project          has not yet provided           a signifi-
        cantly    better       health     services     delivery    system than that
        which previously            existed.       The Public     Health     Service     medi-
        cal specialists          who assisted         us in our review        concluded       that,
        on the basis          of their     visit    to the project       site    and their
        review    of 63 systematically              selected    patient     medical      charts,
        “The program was merely                an extension     of St. Luke’s          Hospital
        Center    Emergency-Outpatient              Clinic.”

                Also an OEO evaluation       team, which visited       the project
        for 2 days in February         1970 to evaluate     the quality      of the
        medical     care provided     by the project    and to review       other
        project     operations,   noted in its June 1970 report           that    the
        project     needed to provide     more comprehensive,     unfragmented
        services     to its patients.       The report   stated:

               “There      appears     to be a lack of a concentrated
               multidisciplinary            approach      in the delivery     of
               health      care services        at the Center.        The total
               patient       handling      system gives      the feeling    of a
               traditional         charity     outpatient     department.”


                                                     14
         Inadequate     space and the need to refer          many patients
to the outpatient         clinics       of St. Luke’s--in     essence,    re-
turning       the patient     to the system which project          proposals
submitted        by St. Luke’s      have described      as impersonal     and in-
stitutionalized--are            significant    weaknesses     in the project’s
operation.

      Other project    operations    and program     components    also
need to be improved      if the project     is to fully     meet its
goals and those of the Comprehensive          Health    Services   Pro-
gram.    Some of the improvements       needed were disclosed        in the
OEO evaluation    team’s    report and in a report       of an evalua-
tion of the project      made by its    own staff    in June 1969.

IMPACT OF THE PROJECT

        The project,      initially      funded in June 1967, began pro-
viding    services     in December 1967.              As of March 1970 the
project    had enrolled         about 10,000 persons.              The project         did
not have information            readily    available      to show how many of
those enrolled        had actually       been treated         after     inception        of
the project,       but the project’s           records    did show that many
low-income      persons     needing     health       and health-related           care
had been served        at the project          site,    at the sponsoring            hos-
pital,    and in their        homes.      For example,        during      the 8-month
period    ended February           28, 1970, the project            reported      the
following      number of patient          encounters      with project          person-
nel.

              Internist                                               7,211
              Pediatrician                                            6,770
              Other physician        specialist                          565
              Dentist                                                    872
              Nurse                                                   1,092
              Social     worker                                          820
              Community      worker                                   5,020
              Other project       personnel        or
                 not classified                                          686

                    Total                                            23,036

        The projectPs    records  showed that,    of the above en-
counters)     16,954 had occurred     at the project    site,   256 had
occurred    at the hospital,     and 5,299 had occurred       in the pa-
tients’    homes.     A specific  place was not shown for the
               .
rcrna1n1;l,n        L5 q’i
                       L I encounters,      and the total    does not include
encounters           at   the   hospital     with nonproject     personnel.

SeTvices           provided     to   enrollees

         At the time of our fieldwork,              the project      offered      basic
medical     services      at the Riverside        Health   Center,      the proj-
ect site,       on 5 weekdays and on two weekday evenings;                    and spe-
cialists      in gynecology,         dermatology,      and surgery      were on
duty one-half        day a week.         In December 1970 the project               ex-
tended    its hours to include             two additional     weekday evenings,
and in April        1971 Saturday        morning   hours were added on a
trial    basis.      Following       our discussions      with project        offi-
cials    about the absence of an after-hours                 answering       service,
the project       also established           an answering    service      at the
Center    on a 24-hour        basis.

        For specialty     clinic      services     and inpatient    care,    en-
rollees     are generally       referred      by the project     to St. Luke’s
Hospital     Center.     The project        also has made arrangements
with    St V Luke’s    to make emergency         room services     available
to project     enrollees      after     hours and on weekends.

       Certain     laboratory      services      were available          at the proj-
ect site     during    5 weekdays,       and chest X-rays,          using     city
health   department        equipment,     were available          on 4-l/2     week-
days e   The   more    difficult      laboratory      work    and    all   X-rays
except   chest X-rays         were provided       at St. Luke’s.           Because
the project      did not have sufficient             space to provide          phar-
macy services,        most of the enrollees’            prescriptions         were
filled   at a nearby private            pharmacy     with which the project
had made special         pricing    arrangements.

          Dental     services       at the project         site     were available        to
enrollees         three    evenings        a week when the city-owned              dental
facilities          used by project          dentists      were not being used by
the city        health     department        for its dental          program.      For
dental       services      during      the day, enrollees            were referred        to
St, Lukess dental             clinic.        In March 1970 we were informed
by the project           director        that OEO had approved             the project9s
plans      for a three-chair             dental    clinic.        According     to the
OEO-approved          grant     for the project’s            fourth     program    year,
the expanded dental               services      are expected         to be operational
in August         1971.



                                                 16
       At   the Time of our review,                a psychiatrist        was avail-
able   at   the project           site    20 hours a week to provide             mental
health     services.          Social      services    were provided         at the proj -
ect si.te but were somewhat limited                    after     the fall     of 1969
when most of the personnel                   in the project’s        social     service
department        resigned        because of a difference            of opinion       as
to their      proper      functions,           In March 1971 OEO informed             us
that the project            staff      then included      one full-time         and one
part-time        psychiatrist          and one psychiatric          nurse and that
three     social     workers        and two social      work aides were then
providing        social      services.

        The project    provided      transportation           to the project
site    and to St.   Luke’s     during     weekdays       for those enrollees
needing    it,   and its neighborhood           health      aides visited     en-
rollees    in their    homes.      The project’s          public    health   nurses
also made some home visits.

        The project      pays St. Luke’s       for all    services  provided
by St. Luke’s         to project   enrollees      who are not eligible       to
have their      health     care paid for by other         programs,   such as
the State     title     XIX (Medicaid)      program.      For those patients
enrolled    in programs        such as Medicaid,       St. Luke’s   bills    the
programs    directly.

        Acceptance     of the project      by low-income         individuals
was evidenced       by information      we received        from interviewing
a member from each of 50 enrolled               families      who, after      being
systematically       selected,     consented      to an interview.           For
example p 44 of the 50 persons            informed       us that    they were
satisfied      with   the medical    service      provided     by the project.

Participation        of   target-area      residents

         As provided     for by OEO guidelines    and approved                project
proposals,        the project  employed   and provided     training              to
residents       of the target   area and provided      them with              oppor-
tunities      to become involved     in the policymaking        and           conduct
of the project        through  membership    in a neighborhood                health
council     0

       Of the project’s      108 employees       as of September       1969,
64 occupied    nonprofessional      positions,      such as neighborhood
health   aides 9 social     service  assistants,       junior    secretaries,
and messengers.       Of the 64 nonprofessionals,             62 were
residents      of the project’s     target    area.     Also)     of the 39
members      of the project’s   neighborhood        health     council      in the
fall   of    1969, 19 were eligible        to receive     project      services.

         The target-area          residents      generally        filled       lower pay-
ing positions,          and, consistent         with      general       conditions       in
the health       services       field,     opportunities          for    their     career
advancement        were somewhat limited.                 The jobs,        however,     ac-
cording     to project        officials,       offered       certain       adva?tages       to
the residents,          such as comparatively              good salaries            and prox-
imity     to their     homes.        Also 9 with      the employment             of a new
training      director      in the fall        of 1969, emphasis              was placed
on providing        basic     education      to the nonprofessionals                  to en-
hance their        basic    skills       and to assist        some of them in ob-
taining     high school         equivalency       certificates.

        The neighborhood             health    council,      whose membership            in-
cludes     representatives            of organizations          dealing       with the
poor in the target              area as well        as persons       eligible      for
project      services,        participates        in decisions         on such matters
as eligibility           criteria,       program priorities,             and criteria
for hiring        nonprofessional           employees.         Of the 20 project             en-
rollees      who were asked during              our interviews          whether      they
knew of the council,               only four stated          that    they did.         Proj -
ect officials          informed       us, however,        that    the council        in-
tended to increase              its membership         of persons       eligible       for
project      services        and to make itself          more widely          known to
targe. -area residents



1 The staff     salaries     are based on (1) salaries           paid for sim-
  ilar  positions       at St. Luke’s,      (2) salaries      paid by other
  OEO-supported       health    services    projects     in New York City,
  or (3) in cases where the above bases cannot be used, sal-
  aries  paid for other         jobs within      the project.
NEED FOR ADDITIONAL  PROJECT SPACE
AND ASSURANCE THAT IT WILL CONTINUE
TO BE AVAILABLE

        The project      needs more space if it is to achieve           its
goal of providing          comprehensive     health  services  to approxi-
mately       20,000 individuals.        Moreover)   a formal  agreement
should       be executed    for the space to ensure its       continued
availability.

         The lack of a formal        agreement     for the space caused
OEO to deny approval         of renovations        to the facility,           which
the project      had requested       to accommodate        certain       equipment
and program      services,     and might    affect      the project’s         abil-
ity    to achieve     its anticipated      benefits.          The inadequate
amount of space has limited             the services        that    can be of-
fered at the project         site    and seriously        affects      the possi-
bility     of the project’s       serving   its    entire      target     popula-
tion.

          In the initial        project      proposal     to OEO, St. Luke’s            and
the Community         Development        Agency stressed           the availability
of space at the city’s               Riverside      Health      Center.         We were
told      by the former       project      director     that     the project’s         goal
to provide       health     care to approximately               20,000 persons         was
predicated        on the use of the entire              Riverside         Health    Center
facility,       which consists          of approximately           25,000 square
feet.       He informed       us that use of the entire                 facility     was
orally      promised     to St. Luke’s          in December 1966 by the city
health      commissioner        who corroborated           this    information        in our
discussions        with    him.

        OEO officials          informed      us that,        in approving        the proj-
ect,    they considered            one of its        strengths     to be the avail-
ability      of the city         facility,        which indicated         that health
services       could be initiated             rapidly.         OEO funding       was ini-
tially      approved      in June 1967, but it was not until                       mid-
October      1967 that       the project          was provided       with    half     of the
second floor        of the Center.              In November 1967 OEO released
the grant       funds,      and in mid-December              1967 the project
started      to provide        health      services.          In June 1968, or a year
after     the OEO grant was approved,                   the Center’s        entire      sec-
ond floor)        consisting        of about 8,000 square feet,                  was made
available       by the city         health      department.         Because a contract
for the space has not been executed                        between     the city       and


                                             19
St, Luke ’ s > however           p the     proj cct    has no legal               rights     to   the
space it occupies.

          Although       the city        submitted     several       proposed    agree-
ments for the space, OEO did not approve                             them because OEO
officials         believed       that the agreements           would not provide
the project          with     sufficient        autonomy    to operate        in accor-
dance with         OEO policy.            The proposed      agreements        specified
that      St. Euke’s         would assume all          responsibilities          in pro-
viding       services,        whereas       the city’s     health       commissioner
would retain           final     authority        over such matters          as general
policy,        procedures,         and hours of operation.                Under the
city’s       proposed        agreements,        in effect,      the city      would not
relinquish         any control           of its facility        to the project.

        OEO considers           the 8,000 square feet             available       to the
project      to be entirely            inadequate       for the comprehensive
health     program       called      for under the OEO grant.                In its    site
visit     appraisal        report      dated June 1970, the OEO evaluation
team stated         that     “Without      question,        the present      space avail-
able to the program               is woefully        inadequate.”         Further,     in
its    guidelines        for the development              of space allocations           for
neighborhood         health       centers,     OEO suggests        as a general
guide that about 38,000 square feet                         be provided      for centers
serving      a target        population       of 20,000 persons,

         Project    officials have also                expressed           the need for           ad-
di tit.ylal    space in their  proposals                to OEO.            The proposal           for
the second program year stated:

       “***  by July   1, 1969, some steps                      will       have to be
       taken to obtain    additional     space                  for      the Neigh-
       borhood  Health   Services    program.”

The proposal        for    the     third     program     year          stated:

        “Space limitations        lend to operating   ineffi-
        ciency,  staff     morale    problems, and curtailment
        of number of patients         served.”

        “A building     of some 30,000 - 35,000                         square       feet
        is needed if the program      is ever to                        service        the
        20,000    - 25,000 patients   envisioned                        at the       out-
        set .”



                                               20
        The   proposal  for the fourth    program  year which began on
November      1, 1970, stated   that registration     of new patients
would be      suspended   after 12,500 persons    were enrolled    due to
the lack      of space to adequately    serve a larger    number of pa-
tients.

       In addition     to not having        adequate     space to serve the
intended    target    population,      renovations       needed to install
pharmacy    and X-ray     equipment      purchased    with     grant  funds were
not approved       by OEO because a contract           for the space did not
exist.     The project     was able to transfer           the X-ray     equipment,
which cost $27,895,         to another      OEO health      services    project,
but the pharmacy       equipment,      which cost about $16,600,             was
being held in storage,           at the project’s        expense,    at the
close    of our fieldwork.

Recommendation        to   the   Director        of   OEO

         If the project          is to provide      the broad range of ser-
vices      contemplated        by the Congress        and OEO for comprehensive
health      services      projects,      OEO,  through    the Office       of Health
Affairs,       should     request     St. Luke’s      and project    officials      to
bring      negotiations        with   the city    for necessary      space to a
satisfactory          conclusion      or, as an alternative,         to seek other
suitable       space.



       The Deputy      Director     of OEO informed     us in his          letter   of
March 17, 1971,        that OEO was in agreement         with   the        recommen-
dation   and that      negotiations     with  the city’s      Health         and Hos-
pital   Corporation       were then under way.        The Deputy           Director
also stated:

       “A major problem      encountered        by the project         has
       been adequate     space.     It    was   originally     antici-
       pated that    the total     health     department     facility
       would be made available          to the project       early      in
       its  development.       There have been many unantici-
       pated problems     in achieving        this     step.

        “The slow progress     the project    has made in solv-
        ing these problems    must be viewed      in the context
        of the complexities      involved   in dealing   with many
        institutions    in the City     of New York.    Negotiations


                                            21
for an acceptable          contract     have i.nvolved      numerous
parties,     including       the Commissioner        and Deputy
Commissioner       of the Health        Services     Administra-
tion 9 the City        Health    Office     and District      Health
Officer     of the Health        Department,      the City’s      Of-
fice     of Legal Counsel,         the Mayor’s      Office,
St. Luke’s      Hospital,       several     labor  unions,     the
Midwestside       Neighborhood        Health    Council,    and
others.

“A further      factor       was the establishment        in 1969
of the Health        and Hospital        Corporation.       HHC was
formally     organized         in July 1970 and on July          1,
1971 the Health         Department       is to transfer      its
health   clinic      facilities       to HHC.      It is hoped
that recent      negotiations         with HHC will     provide     a
new opportunity         for ensuring       additional    space for
the project     .”




                                 22
PRODUCTIVITY        OF PROJECT”S
PROFESSIONAL        STAFF SEOULD BE REVIEWED

         The relatively           low average       number of patients         seen by
project      physicians          and dentists       during   the period       covered
by our review            indicated     that    the project      was not making
maximum use of available                 professional      health    manpower.
Project      officials         acknowledged       the problem     but attributed
it,    in part,        to the number of appointments              missed      by pa-
tients      and to the inadequate              space which limited          the number
of examining           rooms available         to each physician.           OEO in-
formed us in March 1971 that                   the professional       staff’s      pro-
ductivity        had improved,         but we believe        that OEO needs to
periodically           review     such productivity        to ensure     the maximum
use of its professional                staff     members.

       In its    guidelines        for space allocations              for neighbor-
hood health      centers,      OEO suggests        that,      with    adequate     space,
a physician      could be expected           to treat       four patients        an
hour,    or 28 in a 7-hour           day, and that        a dentist        could be ex-
pected     to treat     two patients        an hour,      or 14 a day.          Further ,
an OEO evaluation          team, in a report          on its       evaluation      of
another      OEO health      services     project,       stated     that    a patient
load of 14 to 16 patients               a day treated         by physicians        at
that project       was much less         than one would expect.

     Our analysis      of the project’s               reported    statistics    for
an 8-month   period    ended February              28, 1970, showed that,         on
the average,    a project      physician           treated     9.5 patients   a
day and a project      dentist     treated           5.7 patients      a day.

         In regard       to the project’s         staff-to-patient            ratio,     the
Public     Health      Service    medical      specialists          who assisted        us in
our review       stated      that  “Staff-patient           ratio       appeared     un-
realistic;       staff     top-heavy.s’        In its      June 1970 report           on
its appraisal          of the project,         the OEO evaluation              team com-
mented that        the physicians         were averaging            only six or seven
patients      a day and stated          “Clearly       there      is room for large
productivity         improvement      by the medical            staff.”

       OEO, St. Luke’s,      and project         officials      informed       us
that   they agreed generally          that    the above data indicated
that   the project   was not making maximum use of its                      profes-
sional    staff.   The officials         stated,       however,     that appoint-
ments missed     by project      patients       and inadequate         office


                                              23
space to     pernlit the physi.cians             to have’ more than one room
available     for treating   patients              hampered productivity ~

Recommendation        to   the   Director        of   OEC

        @EC, through       the Off ice of Ilealth           Affairs)      should  re-
view the project’s           professional      staffing        organization      and
determine    actions       necessary      to increase        the professional
staff’s   productivity.



        The Deputy Director          of OEO stated    that OEO was in
agreement      with    the recommendation       and that progress        had been
made.      The project      reported      to OEO in February     1971 that,
during     November and December 1970, its            staff   physicians
treated    s on the average,         17.8 patients    in a 7-hour      day and
that    the project       dentist    treated   an average    9.1 patients
in a 7-hour       day.

IMPROVEMENTS NEEDED IN CERTAIN
SERVICES AND PROGRAM ELEMENTS

        Our review,     in which we were assisted         by Public      Health
Service    medical     specialists,     and the findings       reported     by
the project      staff    and the OEO evaluation       team show that         im-
provements     are needed in certain          of the project’s       services
and I.-ogram elements          if the project    is to fully      achieve
program    objectives.

         OEO’s guidelines       in effect   when the project       initially
was proposed       stated    that the health    services    then being of-
fered     to the poor were insufficient         and often     inaccessible,
impersonal,      fragmented,       lacking  in continuity,      and of poor
quality.       To overcome      these problems,     the guidelines         called
for OEO projects         to:

       --Provide      a broad range of comprehensive               outpatient
          health     and health-related        services--including            pre-
          ventive     health    services,     such as physical         checkups,
          screening,       immunization,      and health      education;       diag-
          nostic     services;     treatment;     dental     care;    and mental
          health     services-   -at a single      conveniently        located
          setting.



                                            24
       --Arrange     for specialized     services           that    could      not be
          provided    directly,     such as highly            specialized         diag-
          nostic   procedures9      to be provided            elsewhere.

       --Arrange     for hospital    inpatient      care         with    the    patient’s
          health    center physician     maintaining             continuity        of
          care D

       --Deal   effectively       with     barriers      usually     encountered
          by the poor,      including       hours     during     which services
          are available      m

       --Enable     an individual    patient      to see the same health
          professionals       over continuing       periods  and all    members
          of a family      to be seen by the same physician           to the
          extent    that the physician’s        training    makes this
          feasible.      The staff    also was to attempt         to see the
          patient     in his family     setting     when appropriate.

       In seeking  OEO funds to undertake       the project,      project
sponsors    stated that    the health   care provided    by the proj-
ect,   among other   things,   would be continuous,      accessible,
family   oriented,   and comprehensive.

Continuity     of   care   for    hospitalized        patients

        Patients    were generally       treated    by their     assigned     phy-
sicians      when they visited      the project      site    for medical      care,
but such continuity        was often       lost  when patients       were ad-
mitted     to St. Luke’s      for inpatient      care.    This situation
occurred      because about half       the project’s      physicians      did
not have hospital       privileges       at St. Luke’s,

       One of the key elements           of the project      proposed     by
St. Luke’s      and approved      by OEO was that      a single     physician
would be assigned        to provide      or supervise     the medical       care
rendered     to a patient       and his family.       Further,    whenever
a patient      was hospitalized,       the assigned     physician     was to
follow    his progress       in St. Luke’s,     because     the physician
would be a member of the Department              of Medicine      at
St. Luke’s.

      For patients     visiting         the Center,       the project    made
every effort    to maintain          continuity     of    care.    These efforts
were generally     successful         for patients        with  appointments,               as


                                           2.5
 evidenced      by a study made by two medical              students      during
 the summer of 1969 under the guidance                  of the former       project
 director   0 The study showed that,              in 377 appointment          visits
 to the Center      by 75 patients         in the sample,’        the patients
 were seen by their        regular     physicians       350 times.        Of these
 75 patients,      50 were seen by their            regular    physicians       at
 all   of their    appointment     visits.

      When a patient   was hospitalized,     however,   continuity
of care by his assigned     physician    was not ensured    because
six internists    and one of the six pediatricians       on the proj-
ect’s  medical  staff  at the time of our fieldwork        did not
have privileges    at St. Luke’s,

        To determine        the extent        to which project        physicians
had maintained          contact     with patients       during     the time that
the patients         were hospitalized,          we asked the SO persons
whom we interviewed             whether     they had been hospitalized
after     enrolling      in the project         and, if so, whether            they had
been seen by a project              physician     during     their    hospital      stay.
Of the 17 persons           who had been hospitalized,               one informed
us that he had been seen by a project                    physician        during    his
hospitalization.            Project     records     also showed that           one
project      physician      visit    was made to St. Luke’s             in the
4-month      period     ended December 31, 1969, during                which time
35 patients         were referred       to St. Luke’s        for inpatient         care.

       Some coordination       of treatment        during   hospitalization
was provided     in that    the project       generally     forwarded       pa-
tients  ’ charts     to St. Luke’s     when patients        were hospitalized
there.    Also,    if a project     patient       went to St. Luke’s         emer-
gency room for service         when the project          was not open,
St. Luke Is forwarded      an emergency         room record     to the Center
to be placed     in the patient’s        chart.

     Project  and OEO officials                informed  us      in April    and
May 1970, respectively,     that            they recognized        that   the lack

---
‘The     sample consisted        of 75 internal    medicine  patients  over
  the age of 30 who had            registered   in the months of November
  and December 1968 and           who had been seen by a project      phy-
  sician    at least   three       times.




                                          26
of hospital        privileges        for some of the project                physicians
affected      the project’s          ability       to fully     achieve       its objec-
tive    of providing         continuity          of care to project           patients.
OEO officials         stated      that,      although      major hospitals          such as
St. Luke’s       did not easily            grant     hospital     privileges,         they
were attempting           to work out a solution               with     St. Luke’s       and
the project.

Family-oriented          health      care

        The project      generally      provided      individually      oriented
rather    than family-oriented           health    care to its      target     popu-
lation,     partially     because the project            had not fully      imple-
mented two operational            features     which were intended          to con-
tribute     to family-oriented          care--medical         care units,     or
teams,    and a family       unit    health    record      system.

        To provide       family-oriented           care as called     for        by OEO
guidelines,      the     project’s       initial      proposal  stated:

       “The key element         of the proposed         Neighborhood
       Health   Services       Program   is that       entire      families
       will   be taken on as a single            unit,      will     be as-
       signed   to the continuing          care and supervision               of
       a single     physician,       and will    receive         a comprehen-
       sive and well-integrated            program      of services         to
       handle   all    their    health   problems       through       one
       source of care.”

         As an approach        to treating        the whole family            with    good
medical      and other      health    care,     the proposal          stated     that     the
project      would utilize         a medical      care unit,        or team, consist-
ing basically          of two physicians--an             internist       or general
practitioner         and a pediatrician--a             nurse,      a health      aide,      and
a social       worker.      The proposal        stated      also that        each family
would be assigned           to a team with          the hope that          a bond of
identity       would be established           between        the patient’s         family
and the team.            The proposal      stated      further      that     the project’s
medical      records      would include       certain       family     data,     such as
names and medical           problems     of family         members.

      Initially,         the project     attempted      to operate    on the ba-
sis of the team concept.              Project    officials     informed      us
that  the attempt         was largely     unsuccessful,      however,      because
of missed        appointments,     a large    number of persons         walking


                                              27
in without  appointments,   patient    care requirements       differ-
ing from those anticipated,      inadequate    personnel    training
to adapt to the team concept,       and shortages     of certain
types of team members.

        The project’s     June 1969 self-evaluation           report    indi-
cated that     the inability        to carry      out the team concept        re-
sulted    in uncoordinated        care’s      being provided    to project
families.      In this    regard,      the OEO evaluation       team, in its
June 1970 report       on its     site    visit    appraisal,   stated:

       “The problems     of the total    family   have not been
       viewed  at all.     Services   have been rendered        only
       to the individual      patient  without    consideration
       or knowledge    of the total    family   picture.”

        In regard      to patient    records,    the project         maintained     a
unit    health    record     which identified      medical     care given to
an individual,         but a family     unit  health    record       system had
not been implemented.             The Public   Health      Service      medical
specialists       who assisted      us stated    that their        review     of pa-
tient     medical    records     had shown that:

       “The health       care   rendered       was individual       centered.
       It was not      family     centered.

       “There  were no treatment              plans     to reflect   a full
       assessment  of either    the           individual       or the family
       care needs. ”

The study made       in the summer of 1969 by the two medical
students   under     the guidance      of the former   project    director
also disclosed       deficiencies      in patient  records,    including
an absence of       social    and family    data.  The study report
stated:

      “The absence of any real          social      history      for 55%
      of the patients      is especially         disturbing        in view
      of the fact     that Neighborhood          Health     Services      Pro-
      gram serves     a low-income      population        where a high
      level   of social    and environmental           problems      could
      be expected.       The absence of family            histories       and
      review    of systems    could    seriously       compromise       the
      quality     of subsequent     diagnoses.”



                                          28
       During    discussions      of this          matter,    project     officials
agreed that      the project      had not          made much progress           in pro-
viding   family-oriented         care but          told    us that    consideration
was being given        to reintroducing              the team concept.

Comnrehensive        health     care

          The initial     proposal      stated      that     enrollees      would re-
ceive      a comprehensive        and well-integrated              program      of ser-
vices      to handle    all   their    health      problems        through      one
source       of care.     The proposal         stated      also that       a basic
range of preventive,            diagnostic,         and therapeutic            services
would be carried          out at the project             site    with    the patient’s
family       physician    having     available        to him the specialized
facilities         and services      of St. Luke’s           or the city        health
department         for problems      he could not handle              himself.

        Because the projectss            space is limited,           however,     the
services     offered       at the project        site    are limited      and many
patients     have to be referred            elsewhere,      particularly        to the
specialty     and dental         clinics    at St. Luke’s,         for needed ser-
vices.      Our analysis        of project       records    for a 5-month         period
ended October         31, 1969, for example,             showed that      the number
of appointments          of project      patients      at St. Luke’s        specialty
and dental      clinics       averaged    about 1,180 a month and the
number of patient            encounters     with physicians          and dentists
at the project          site   averaged     1,675 a month.

        Although     referrals     to other    health   care sources       are
appropriate       when services       are not available        at a project
site,     we believe      that a system of frequent          referrals     of
large     numbers of patients         to other   health     care sources
where they encounter           long waits    and receive       impersonal     care
is little      improvement       over the prevailing        health     care sys-
tem which the poor would otherwise                encounter      and which the
Comprehensive        Health    Services   Program is designed           to change.

         Project     proposals     submitted      by St. Luke’s      have stated
that     it is the opinion         of most objective        observers      that
neither       St. Luke’s      emergency     room nor its      outpatient       clinics
provide       the type of comprehensive            health   services      consid-
ered to be “good medical              care”    by generally      accepted      stan-
dards- -that       they are “distant”          in  a  geographical       sense     from
the target        area and in a personal            sense in the type of in-
stitutionalized,           impersonal     medical      care which they offer
to patients.

                                              29
        We     were informed        by project   officials        that, unless   a
patient        was accompanied         to St. Luke’s       by a project    aide,   he
generally         had to wait       for a long period        of time to obtain
medical        care even if an appointment             had been made for him,
The OEO        evaluation       team also noted this         situation   and, in
its   site      visit     appraisal      report, stated:

         “It   appears   that   the procedure            is for each patient
         to be given     a referral    at the           Center and to then
         confront    the St. Luke’s     clinic           system on his own.”

         The project       also appeared    to have fallen            short     in fully
achieving       its objective      of providing      preventive          health      ser-
vices.       For example,       the Public    Health    Service         medical     spe-
cialists      who assisted       us concluded     from their          review      of pa-
tient     records    that:

         --The health   care rendered  was primarily                    episodic.          It
            was not preventive   or comprehensive.

         --Physical   examinations          did   not    routinely       include     den-
            tal examinations.

         --There   were no treatment           plans    to   reflect      a full     as-
            sessment   of either  the        individual        or the     family     care
            needs.

         --The health         care that was rendered          was done almost
            exclusively        by either     a physician      or a dentist.        Ex-
            cept on rare occasions,            the   record    documentation       did
            not substantiate         nursing     evaluation,      diet    and nutri-
            tion    services,      environmental       health   services,     or
            community      worker     involvement.

         In    its   June    1969 self-evaluation         report,     project       per-
sonnel        stated    in   regard  to preventive        medicine:

         “That   there    is presently      no well    thought    out and
         organized     approach    to this    extremely      important
         concept    is of great      concern.      Again,    it should be-
         come a basic       component    of NHSP’s [Neighborhood
         Health    Services    Program’s]     present     and future
         goals.”




                                            30
              *              *               *               *                *


       “Many patients     have been seen as walk-ins    several
       times but have never had a full     7G,orkup [complete
       physical   examination]   .”

The report        recommended       that:

        “1.   Systems be instituted              to provide    yearly         X-rays,
              pap tests, checks for              lead poisoning       in      c,;il-
              dren.

        “2.   Greater   emphasis   be placed   on the education
              for project    employees   in regard   to preventive
              care. ”

The project   subsequently      initiated             a campaign        for       detection
of lead poisoning     in children.

        Project        and OEO officials          stated    that    they were aware
that many patients             were being referred            to St. Luke’s       clin-
ics but that           the lack of space made it necessary.                     The
project       director      stated      that plans      were under way to in-
crease      the services         offered     at the project         site.      The offi-
cials     stated       also that      they recognized         that    improvements
were needed in preventive                  health    services      but that part        of
the problem         lay with      the attitude         of project      patients     who
generally        were not familiar           with    the benefits         of preventive
medicine        and therefore         were not inclined          to seek it.

Conclusion

        Improvements         are needed in certain            services    and pro-
gram elements         if the project         is to make comprehensive          health
services      available       to its    target     population       in the manner
contemplated         by the Congress         and called       for by OEO guide-
lines     and approved        project     proposals.        Some of these im-
provements        would be facilitated           if adequate        space was avail-
able.      Others     will    require     changes     in the project’s       ap-
proaches      to and methods          of organizing        and delivering     health
services,       cooperation        of the sponsoring          hospital,    and in-
creased      efforts       to provide     and encourage         the poor to seek
preventive        care.




                                              31
k:i;.-ommt~ndatio?lr;
--^..  _------               to    theI_~Director        of -.OEO

         C?F:!))   Through        the   Office      of   Health     Affairs,    shCo::ld:

         - -Work with project               and St. Luke’s    offi ci2Z.s to           obtain
            hospital  privileges              for all project     physicians.

         --Stress    to project      officials        the importance    of pro-
            viding   family-oriented           health    care and implementing
            procedures     and a records         system thar will     aid in such
            an approach a

         --Following     arrangements    for suitable                       space,  as already
            recommended,     ensure that    services                   will     be available
            to the maximum feasible        extent    at                the project       site.

         --Reemphasize   to project                  officials       the need to expand
            preventive  health   care                services       and to educate the
            poor to seek such care.



      The Deputy Director    of OEO, in his letter      of March 17,
1971, informed   us that OEO was in agreement      with    these rec-
ommendations,   and he indicated     actions that had been or
would be taken to implement      them.

         In regard      to hospital     privileges,         the Deputy Director
informed      us that a series        of discussions           with    St. Luke’s        to
overcome      the long-standing         problems      of hospital         privileges
had resulted         in some progress.           The project        informed      OEO
in January        1971 that all      project      physicians        had clinical
appointments         at St. Luke’s      and that      all pediatricians             had
attending       status.      The project       stated     that    it did not have
a problem       in getting      its patients        admitted      to the hospital,
despite     the fact      that    the physicians        did not have an attend-
ing status,        but that     the problem       occurred      in attcmpting          to
coordinate        patient    health   care management           during     hospital-
ization,

        In February     1971 the project        informed    OEO that        it had
formalized     a mechanism       whereby    its physicians,          in a rotating
basis,     were attending      hospital     rounds    and that       such atten-
dance provided       the project       with a direct     relationship           to
the patient     while    hospitalized.         The project      also     stated


                                                    32
that    its patients        would     be seen      by the     project’s       nursing
staff     during  their      stay.

       In regard       to family-oriented           care,      the Deputy Director
stated    that    the team approach          was being         initiated         on a trial
basis.      The project        informed     OEO in January             1971 that      one
team had been established               as a pilot       project        to enable      proj-
ect officials        to evaluate        properly      the goals         of a team and
to determine,        in fact,       a team’s     impact      on a specific          pa-
tient    population.          The project       stated     that the pilot           proj-
ect was intended          to avoid      the pitfalls         that had occurred             in
the past when the teams were quickly                     implemented          without
the necessary        training       and without       the teams’          goals,    objec-
tives,    and evaluation          procedures       having      been worked out.

        In regard    to family   records,   the project     informed       OEO
in January      1971 that basic     changes would have to be worked
out with     St. Luke’s    since project    records   were tied       to the
St. Luke’s      system.    In the meantime,     the project      stated,
a face sheet summarizing         social   and medical    facts    relating
to the family       was being made a part      of each project       pa-
tient’s    record.

        In regard   to increased      services      at the project                 site,
the Deputy Director       stated    that,       as we had indicated,                   im-
provements     depended,    in large      part,    on the availability                       of
additional     space.

        In regard    to preventive       health   services,      the Deputy
Director     stated    that  some progress      had already        been made
but that     changes in health        care practices        to give greater
emphasis     to preventive       care required     substantial        and con-
tinuing    educational      efforts    among both providers           and con-
sumers.




                                              33
                                        CIIAPTER 3


            IW?RO\TEFIE:\JTS 1CEEDED IN PROJECT ADMIh’ISTRATION

COKTROLS OVER ELIGIBILITY                 DETEmIINATIONS
%IOULD BE STRENGTHENED

          The project       made free medical     services      available,    in
some instances         9 to persons      who did not meet OEO-approved
eligibility        criteria      and, in other    instances,       to persons
whose eligibility            had not been clearly       established.        The
project      needs to strengthen          its controls     over eligibility
determinations          to ensure     that OEO funds are not diverted
from the intended            target  population.

        OEO guidelines         specify     that    all persons   receiving       OEO-
assisted       health   services       must meet a test       of need by reason
of circumstances         of poverty        and that only persons         residing
within     the designated         target     area may receive      regular      care.
The guidelines         specify,      however,      that no such determina-
tions    are to be made in a circumstance                when the need for
medical      services     is acute but that determinations               of eligi-
bility     for continued        services       are to be made as soon as pos-
sible    after     the initial       services.

        In accordance      with OEO guidelines         and with OEO’s ap-
proval)    the project       chose to use the family          income stan-
dards of New York State’s           Medicaid     Program in determining         a
person’s     eligibility      for project     services    by reason of cir-
cumstances       of poverty.      The project     proposals      also stated
that    it would enroll       only persons     residing     within    its  tar-
get area.

        The project         enrolled      some persons,          however,     and used
OEO funds to provide              services       to them, without          regard     to
their     family       incomes    or places        of residence.          For example,
participants           in a program       for unwed pregnant            teenagers,
carried      out at a private           clinic       located     in the target        area,
were enrolled            in the project,         prior     to September       1969,
along with members of their                   families,      regardless       of family
income and whether             or not they resided             in the target        area.
In October         1969 there were 75 participants                  in the program.
A project        officia    1 informed       us that most partic ipants



                                              34
resided    in   the target      area but that    those         residing      ou”lside
the target      area were      not refused  services.

        On September        1, 1969, the project’s            neighborhood       health
council      directed     the project     to continue         serving     those par-
ticipants        then in the program        and their       families      regardless
of residence         but stated     that,   thereafter,        although      no re-
gard was to be given to family                income,      new participants          and
their     families      would be eligible        for enrollment         in the proj-
ect only if they lived            in the target         area.

        In another       instance,      a community     organization        operat-
ing in the general            geographic      area of the project          estab-
lished     a program       in the summer of 1968 to train               mothers     and
aid them in finding             jobs;   day care for their         children      was
to be provided         in nearby homes.           The trainees       and all     adult
members of the families               who were to provide        day-care      ser-
vices     were required         to have physical       examinations.          The then-
project     director       instructed      the project     staff     to consider
all persons       referred        from this    program    as eligible       for proj-
ect services         and to enroll       them in the project           for regular
care e

        On September        1, 1969, the neighborhood              health    council
informed      the project’s       department        heads that      all partici-
pants     in this     program   and their        families      then enrolled       in
the project        would remain      eligible       for project       services     but
that    new participants        would not be enrolled              unless    they
qualified       on the basis      of the project’s           income and resi-
dency criteria.           The council       stated,       however,    that   those
participants        not qualifying        for regular        care would be given
initial      physical     examinations        at the project        without     charge.

         The project       generally       did not verify          enrollees’     re-
ported      family     incomes      and places     of residence.            Aside   from
verbal      statements       made by the enrollees            or the showing          of
Medicaid       cards at the time of initial                 application        or reregis-
tration,       no verification           was made in regard           to incomes      or
places      or residence.           We did not seek to verify               the addresses
of all      enrollees;       but,    in attempting        to contact        136 system-
atically       selected      enrollees       to interview        them about the ser-
vices     they and their          families     had received         from the project,




                                             35
w iound that        39 did not reside             at    the   addresses   shown    for
tj-leni i n proj cc-t records D1

        To reduce     the number of         ineligible      patients,  the proj-
cct adopted       a policy     late   in    August     1969 which provided      that
parsons     without     appointments,         who were not otherwise       eli-
i:i.ble  for services      P would be       treated     only if they were con-
sidered     medical     emergencies;        otherwise,      they would be re-
ierred     elsewhere.       If persons        had been registered      at the
project    9 however ) they would           continue     to be served.

       When we questioned        project    officials   about the problems
of eligibility     during    our review,        we were told  that  the proj-
act was formulating       policies       and procedures    by which ineli-
gible   persons  could be removed from the registration               roles.

          Project,     St. Luke’s,       and OEO officials           acknowledged
that       some ineligible        persons    may have been served by the
I’ reject.        They   stated,     however,    that    eligibility       determina-
tions       were not always easily            or expeditiously         made because
of the transient            nature    of the target        population       and the
need to follow           OEO’s policy       that eligibility          determinations
be made in ways consistent                with   the objective          of eliminating
financial       9 administrative,         and other barriers            to needed
health       services.

Recommendation        to   the   Director        of    OEO

        To preclude      the use of OEO funds to provide              services
‘o ineligible        persons,     which diverts      those funds from the
 intended     target    population,      OEO, through      the Office     of
IIealth   Affairs,      should require       the project      to strengthen    its
controls      over eligi.bility       determinations      D




1
    Tn addition     to the 50 successful interviews        and 39 cases of
    erroneous     address, there were 36 prospective        interviewees
    who were not at home, nine who were not willing              to be inter-
    viewed,    and two who had not made medical      visits      to the
    project.




                                            36
        The Deputy Director         of OEO informed          us that OEO agreed
with    the recommendation         and that       considerable     progress       had
been made in this           area since     the close      of our fieldwork.
In this     connection,        the project      informed     OEO in February
1971 that it had embarked on and was continuing                       a reregis-
tration     campaign      intended    to (1) screen out patients               no
longer     eligible     for the project        and (2) maintain        the records
of patients         who were eligible        and who were still        utilizing
the project.




                                         37
NEEDED IMPROVEMENTS MADE OR PROMISED
IN MANAGEMENT OF GRANT FUNDS

        A number of matters        needing     improvement    came to our at-
tention    in our review      of selected        aspects   of the management
of grant     funds.     We brought     these matters       to the attention
of OEO in a draft        of this    report     in December 1970 and pro-
posed actions       necessary    to effect       the improvements.       By let-
ter dated March 17, 1971, the Deputy Director                  of OEO in-
formed us that OEO agreed with              our proposals,     and he cited
actions    that had been or would be taken to implement                  them.
The matters       and the actions      cited     by the Deputy Director        are
discussed      below.

Audit    of   indirect    cost   rate   needed

      OEO had not made or arranged              for an audit    of the rate
used by St. Luke’s        for charging       indirect    costs  to the proj-
ect during     the project’s       first   2 program    years which ended
October    31, 1969.      On   the   basis   of   St. Luke’s   acknowledgment
in the proposal       for the project’s         third  program year that
the rate used during         the first     2 program    years was too high,
it appears     that    the amounts paid by the project            to St. Luke’s
for indirect      costs   during      that time may have been excessive.

         St. Lukess was paid $94,094 and $131,692                 for the first
and second program        years,     respectively,       for providing       cer-
tain    administrative     services,       such as personnel         and payroll
services)      to the project.         These payments        were computed      on
the basis      of an indirect     cost rate of 15 percent              of project
salaries     and wages including         fringe    benefits.        This arrange-
ment was accepted       by OEO, subject          to audit.       Through Octo-
ber 1970, however,        no audit      had been made.

      St. Luke’s      acknowledged      in its proposal         for the proj-
ect’s  third    program     year that     the 15-percent        rate was too
high.    Therefore    s OEO tentatively         approved     $50,000,  rather
than a percentage,        for indirect       costs   for the third     program
year 2 subject     to the following         special    condition.

        “The amounts budgeted       for indirect    costs        shall
        not be expended until       an auditing    agency        or an
        auditor   designated   by OEO identifies        the      direct
        and indirect     costs incurred     in conducting          the



                                         38
       approved   work program       of this    grant   and arrives
       at an indirect       cost allocation      for the work
       undertaken     pursuant   to this     grant***.”

      In November 1970,             OEO officials          informed       us that OEO
was planning   to review            the St. Luke’s           indirect      cost rate.

       We proposed       in our December 1970 draft            report    that OEO
arrange     for an audit        to be made.       In response,      the Deputy
Director      informed     us that OEO, on several          occasions,      had
requested       St. Luke’s      to submit    indirect    cost proposals       for
the first       3 program years       so that OEO could arrive           at an
overhead      rate.     He stated     that an indirect       cost proposal        for
the third       program year,      submitted      on January     29, 1971, had
been deemed to be inadequate              and that,     as a result,       no
funds for indirect           costs  had been approved        for the fourth
program year.          He stated    also that further        discussions      were
under way between          the OEO staff       and St. Luke’s      personnel      on
this    matter.

Project   should    seek reimbursement
for services     provided   to St. Luke’s

        Although        the project        pays their       entire      salaries,      full-
time project          physicians       who have hospital            privileges        at
St. Luke’s        are required          to spend 10 percent             of their      work-
ing time at St. Luke’s                clinics.         St. Luke’s      has not reim-
bursed      the project        for these physicians’               services.        As of
February       1970, five        project       physicians,       receiving        annual
salaries       totaling       about $131,000,           were working         on a part-
time basis        at St. Luke’s.

        St, Luke’s     associate    director    informed     us that     some
Medicaid      payments    had been received       by St. Luke’s       for ser-
vices    provided     at the clinics      by project     physicians.       He
also told      us that St. Luke’s        was planning     to reimburse      the
project     in some manner for these physicians’               services.

       We proposed    in our December 1970 draft          report     that OEO
determine    whether    the project     had taken action       to obtain      re-
imbursements     from St. Luke’s      for services    provided       at
St. Luke’s    by project     employees.      The Deputy Director         of OEO
informed    us in March 1971 that        such action    had been taken.
The project    informed     OEO in January      1971 that    it had set up
a system whereby      all   hours spent by project        physicians       at


                                                39
St.   Luke’s    clinics      would      be reimbursed             to the project     at
the   rate   that St.       Luke’s      is reimbursed             from Medicaid.

Internal   controls         over     payroll        procedures
need strengthening

       The project     needs to strengthen         certain   internal     con-
trols    over its payroll        procedures    to ensure   that duties      and
responsibilities       for preparing        and disbursing     the payroll
are separated      appropriately        and that payroll     expenditures
are appropriate       and are supported        by adequate     documenta-
tion,

        Our review   of the project’s                 payroll       procedures     showed
the   following    weaknesses.

       1.   Time cards of          employees         working   at the      main project
            site were not          certified         by supervisory        personnel.

       2. Employees    working      at places             other  than the main
          project   site   certified      their            own time and atten-
          dance.

       3.   The individual           responsible         for     payroll   preparation
            also distributed            the payroll            checks.

       4.   Some project    physicians                were paid for substantial
            periods   which were not                recorded   on their time cards.

      Project    officials  informed     us in April    1970 that  ac-
tion would be taken to provide         the necessary     internal  con-
trols a In March 1971, the Deputy Director            of OEO stated
that  all   four weaknesses    concerning     payroll  procedures   had
been corrected.

Questionable      project      expenditures

        Through mid-December         1969, the project        had paid about
$65,200     in salaries      and related   fringe     benefits      and over-
head charges       which we questioned       because the employees’           po-
sitions     either   were not needed for project            operations     or
had not been authorized           by OEO. Such expenditures            might
have been avoided         through   closer   monitoring       of the project
by OEO. Details         follow.



                                               40
     1. A pharmacist     was initially         employed     with    OEO’s ap-
        proval    on March 24, 1968, but her employment                  was
        terminated    on September        30, 1969, because          the proj-
        ect had not established.          its    own pharmacy.         During
        the first    6 months of her employment,               her efforts
        in helping     to formulate       pharmaceutical         requirements
        for the planned       project     pharmacy     were applicable         to
        the project.        The planned       pharmacy   was not estab-
        lished,    however,    and the salary         and related       charges
        of about $13,700       applicable        to the remainder        of her
        employment    period,      when she worked at St. Luke’s
        pharmacy,    were of questionable           benefit      to the proj-
        ect s

     2. A public      health      nurse and a secretary            were employed,
        without      OEO approval,         at a private       clinic      in the
        target     area which operated            an educational          program
        for unwed pregnant             teenagers.       The former        project
        director       informed      us that he had decided             to fund the
        positions        from project        funds even though the clin-
        ic’s     operation       was not mentioned         in project        pro-
        posals     and the clinic          did not require          that partici-
        pants reside          in the target       area.      Through Decem-
        ber 13, 1969, salary              and related      charges      for these
        two persons         totaled      about $30,550.         The project       dis-
        continued        funding     these positions         on March 6, 1970.

     3.   The project     employed    a person        to supervise      students
          who were enrolled       at Columbia         University     and who
          were assigned      to the project’s           neighborhood      health
          council    to meet a requirement            of their     master’s      pro-
          grams in social      work.      The students         were not re-
          quired   for project      operations.          The project      direc-
          tor informed     us that     this    position,       for which sal-
          ary and related      charges      totaled      about $18,610
          through    mid-December      1969, would be eliminated               at
          the end of the 1969-70 academic                year.

     4.   The project     used grant      funds to pay one third         of
          the salary    of an employee        working     in St. Luke’s     per-
          sonnel   department.        Personnel     costs   incurred    by
          St. Luke’s    for project       business    were to be covered
          by St. Luke’s      indirect     cost charges      and, therefore,
          direct   payment by the project           of part    of the salary
          of this    employee     was not appropriate.           Salary  and


                                          41

f'
            related     charges  for this    employee      totaled      about
            $2,340    through   mid-December    1969.



       In our December 1970 draft          report,     we proposed      that
OEO determine      whether   the project      had taken appropriate
action    to adjust    the charges      to OEO grant     funds for items
which were not authorized          under grant     provisions       and stated
that OEO should monitor         the project’s      financial      controls
and procedures      more closely      to ensure that grant          funds
would be expended        in accordance     with prudent       business     prac-
tices    and OEO requirements.

     In March 1971,         the Deputy Director         informed      us that
OEO agreed with our         proposals  and that

       --the    OEO account  had been reimbursed    by St. Luke’s
          for the full    amount of $13,700   of the pharmacist’s
          salary,

       --the    program   for teenagers was discontinued               promptly
          after    OEO became aware of it,

       --the   position  of supervisor   of the          social      work   stu-
          dents was eliminated     in May 1970,          and

       --the     OEO account   was reimbursed    by St. Luke’s   in the
          full    amount of $2,340 for the employee      working   in
          St.    Luke’s  personnel   department.




                                      42
                                    CHAPTER 4


                                SCOPE OF REVIEW

        Our review      was concerned        primarily      with   the policies,
procedures,       and practices       followed        in the administration        of
the Neighborhood         Health     Services     Program by St. Luke’s           Hos-
pital    Center     in New York City         and the extent        to which Com-
prehensive      Health     Services     Program objectives           had been met.
We were assisted         in our review        by Public      Health     Service
medical     specialists      who evaluated         the quality       of medical
care provided         by the project       and the adequacy          of patient
medical     records.

        We reviewed       the basic      legislation         authorizing     the Com-
prehensive      Health      Services    Program,       OEO policy        and guidance
publications      and documents,           and the grant          agreements    ap-
proved     by OEO. We examined             pertinent       records      and documents
and interviewed         officials      of OEO, the project,              St. Luke’s,
and the Community           Development       Agency.        We also interviewed
50 program      beneficiaries        to obtain       their      views on services
furnished     by the project.

      Our review   was performed           primarily   at the       project     site,
at St. Luke’s    Hospital      Center      in New York City,         and at
OEO’s headquarters      offices     in     Washington,   D.C.




                                           43
APPENDIXES
                                                                    APPENDIX I


                    OEO-FUNDED COMPREHENSIVEHEALTH

                            SERVICES PROJECTS IN

                                  NEW YORK CITY


                                       Administrating
          Project                          agency                   Grantee

Neighborhood Health Ser-
  vices Program
160 West 100th Street               St. Luke's     Hospital     St. Luke's Hos-
New York, New York                  Center                      pital Center

Neighborhood Health Center
  of Provident   Clinical
  Society,  Inc.                    Provident Clinical          Community De-
476 Nostrand Avenue                 Society of Brooklyn,        velopment
Brooklyn,  New York                 Inc.                        Agency

Charles Drew Neighborhood
  Health Center                     Catholic Medical            Community De-
425 Howard Avenue                   Center of Brooklyn          velopment
Brooklyn, New York                  and Queens                  Agency

Red Hook Neighborhood
  Health Center                                                 Community De-
70 Atlantic   Avenue                Long Island     College     velopment
Brooklyn,   New York                Hospital                    Agency

Sunset Park Health Center                                       The Lutheran
514 49th Street                     The Lutheran      Medical   Medical Cen-
Brooklyn,  New York                 Center                      ter

Gouverneur Health Services
  Program                                                       Beth Israel
9 Gouverneur Slip                   Beth Israel     Medical     Medical Cen-
New York, New York                  Center                      ter

Dr. Martin Luther   King,   Jr.
   Health Center                                                Montefiore Hos-'
3674 3rd Avenue                     Montefiore  Hospital        pita1 and Medi-
Bronx, New York                     and Medical Center          cal Center
                                                                                 MAR 17 1971




    Mr, Henry Eschwege
    Associate      Director
    United    States     General Accounting
       Office
    Washington,       D.C. 20543

    Dear     Mr.    Eschwege:

    As requested          in    your letter   of December 29, 1970, we have reviewed in
    detail   the       draft     report   on the Neighborhood Health Services Program of
    St. Luke's Hospital             Center,         New York, New York. We have also provided
    copies   to the Project              and Hospital      staff and have received and review-
    ed their   comments.

    Comments on the draft      report    are enclosed.  These statements                 include
    both general  observations        and comments on particular  points.

    We would        be pleased      to    discuss      any of   these comments further   with   G.A.0,
    staff.

    Thank     you     for   your   assistance.

    Sincerely,
I



    Deputy       Director


    Enclosure




                                                          48
                                                                                                APPENDIX          II


Comments on GAO Draft     Report, "Opportunities    for                        Improving      the     Neighborhood
Health  Services   Program for the Poor Administered                            by St.     Luke's      Hospital
Center.  New York,    New York.

GENERAL COMMENTS

The O.E.O.        Comprehensive       Health      Services   Program assists         local     agencies     and
groups    that are committed           to participate        in the development           of more effective
ways of providing          ambulatory        health     care to low-income        populations.          The
Program Guidelines           indicate      the goals and general         approaches         of these efforts.
Local   institutions         and personnel          plan and implement      their      own special       ways of
working     towards     these goals.

A key aspect         of the O.E.0,      - supported    experiments       has been the variety       of local
approaches        that have been undertaken.           In this way, the opportunities            for new
learning      and demonstrations         under diverse     conditions       and circumstances      have been
furthered.          Special  features      of the project     administered        by the St. Luke's     Hos-
pital     Center     are the participation         of a major teaching         hospital    and a health
department        facility,    along with concerned        community       groups    on the west side of
Manhattan       Island.

A major problem           encountered        by the project        has been adequate           space.    It was
originally        anticipated       that     the total      health    department      facility      would be made
available       to the project          early      in its development.           There have been many unantic-
ipated     problems        in achieving        this   step.

The slow progress         the project         has made in solving          these problems       must be viewed
in the context       of the complexities             involved     in dealing     with many institutions               in
the City   of New York.           Negotiations         for an acceptable        contract      have involved
numerous   parties,       including       the Commissioner          and Deputy     Commissioner       of the
Health   Services      Administration,           the City Health       Office    and District        Health     Officer
of the Health       Department,        the City's        Office   of Legal Counsel,         the Mayor's       Office,
St. Luke's     Hospital,       several      labor    unions,    the Midwestside         Neighborhood        Health
Council,   and others.

A further     factor        was the establishment              in 1969 of the Health          and Hospital      Corpor-
ation.     HHC was        formally     organized        in July     1970 and on July        1, 1971 the Health
Department      is to       transfer     its health        clinic    facilities       to HHC.     It is hoped that
recent    negotiations           with HHC will        provide     a new opportunity         for ensuring       addi-
tional    space for         the project.          Many of the problems             of the project      have been and
are directly        or    indirectly       related      to the space problems.            Their     experience      has
demonstrated        and     documented       the extraordinary          difficulties      in trying       to implement
a Comprehensive           Health     Services      Program under these conditions.

The comments of the Project Director                    and   the     St.       Luke's     Hospital      staff     are   attached
as Exhibit  1.  [See GAO note.]

GAO note:           The exhibit           was considered                  in    the      preparation     of
                    our final          report  but has              not        been      included    here.


                                                       49
APPENDIX   II


SPECIFIC   COMMENTS

      GAO note:          Following    are excerpts      from the specific
                         comments accompanying        the Deputy Director’s
                         letter,   which refer     to the recommendations
                         made in our final     report      or to proposals
                         made in our draft     report      and to actions
                         taken thereon.     The page numbers refer         to
                         the pages of this     report.

                         We did not include             here those portions     of
                         the specific        comments which referred         to
                         particular       points      in our draft    report   or to
                         the project’s         views,      as these comments were
                         either     included      in, or considered       by us in
                         the preparation          of, our final     report.

     “We are in agreement           with    this    recommendation.
     Substantial      efforts      have been made by OF0 staff
     as well     as local     project     officials       to obtain
     needed space.         *** negotiations          with    the Health
     and Hospital       Corporation       are now underway;            staff
     of the Office       of Health       Affairs,      project     offi-
     cials,    and St. Luke’s         personnel       are actively        in-
     valved.   ”   (Page 21.)

     “We are in agreement              with  the recommendations
     on staffing     patterns          and productivity.      Much
     progress     has already          been made in this    area.”
      (Page 24 .)

      “We are       in   agreement     with    these   recommendations:

                “Hospital     privileges       for physicians--Consid-
                erable    progress      has   already  been made in
                this   area. ”

            “It    should    be noted that OEO consultant
            staff     have had a series         of discussions      with
            the St. Luke’s         staff    to overcome      the long-
            standing      problems       of hospital   privileges.
            Significant       progress      has been made.”

            “Family-oriented ~~-        health ------
                                                 care--Some       progress
            has already       been      made in this     area     k**O’r


                                              50
                                                                      APPENDIX         II


       “The    team approach         is   being    initiated          on a
       trial     basis .”

       “Fragmented   Services--As indicated,                       improve-
       ments depend in large -part on the                       availability
       of additional    space.”

       “Preventive        Health Services--Some              progress
       has already        been made.”     (Page         32 .)

“WC are in agreement            with  the recommendation     re-
garding   eligibility.           Considerable    progress   has
been made in this           area since    the close    of GAO’s
field   work.”         (Page 37.)

“OEO has, on several            occasions,         requested
St. Luke’s       Hospital     to submit        indirect      cost pro-
posals    for the three         program       years so that        OEO
can arrive       at an overhead         rate.        OEO, as well       as
other    applicable       Federal     agencies,         does not nor‘-
mally    compute or otherwise             develop       a grantee’s
overhead      costs.      An indirect         cost proposal        for
the third      program     year,     submitted         on January      29,
1971, has been deemed to be inadequate.                         As a
result,      no funds for indirect             costs     have been ap-
proved     for the fourth         program      year.       Further     dis-
cussions      are underway        between       the OEO staff        and
St. Luke’s       personnel      on this       matter.”        (Page 39 .)

“Action    has been taken on reimbursements                         for    ser-
vices   provided   at St. Luke’s,”    (Page                    39 .)

“All  four weaknesses  concerning    payroll                      proce-
dures have been corrected.”       (Page 40 .)

“The OEO account     has been reimbursed                  by St. Luke’s
for the full     amount of $13,700,   of               the pharma-
cist’s  salary.”      (Page 42.)

“This    program      for teenagers  was discontinued
promptly     after      OEO became aware of it.”      (Page                    42 .)

“Five   social  work students        were         assigned   to the
Midwestside    Neighborhood     Health            Council,  free of
charge 9 by Columbia     University.               The students


                                    51
APPENDIX    II


     were involved     in assisting      and training      health
     council   members,     a valuable    service     to facilitate
     program   development.       However,    since     the position
     of supervisor     was not specifically         approved      by
     OEO, the position       was eliminated       in May i970.”
     (Page 42 .)

     "The OEO account         has been reimbursed    by St.      Luke’s
     in    the   full   amount of $2,340.”      (Page 42 .)




                                   52
                                                                                                        APPENDIX       III




                               DEPARTMENT       OF     HEALTH,       EDUCATION,         AND   WELFARE
                                                     WASHINGTON,         D.C.   20201




OFFKE   OF THE    SECRETARY
                                                           FEB 19 1971




             Mr.    Philip   Charam
             Associate      Director,       Civil        Division
             U.S.    General      Accounting            Office
             Washington,        D. C.     20548

                 Dear    Mr.   Charam:

                 Reference     is made to your letter          of December         23, 1970 in which
                 you requested        that we review      GAO”s    draft    report     on their    audit
                 of the operations        of the Neighborhood        Health     Services      Program
                 for the Poor      administered       by the St. Luke’s        Hospital     Center,
                 New York,       N.Y.,      and funded    by the Office      of Economic
                 Opportunity.

                 We believe     that this report     reveals    an excellent    understanding
                 of the philosophy,      purposeso      and design   of neighborhood         health
                 centers.     The report@s      recommendations        are well-taken.

                 We appreciate      the     opportunity     afforded    us to review                 the draft
                 report,    and would       like to receive       a copy of the final                report    when
                 it is released.

                                                                         Sincerely      yours,


                                                                            i jr’, .’
                                                                           (, / ,‘. ;.i;a&&klli/
                                                                         Jame;g,s
                                                                         Assistant      Secretary,       Comptroller




                                                                    53
APPENDIX IV


                  PRINCIPAL OFFICIALS OF THE

                 OFFICE OF ECONOMIC OPPORTUNITY

              RESPONSIBLE FOR THE ADMINISTRATION OF

              ACTIVITIES   DISCUSSED IN THIS REPORT


                                                Tenure of office
                                                From             To

DIRECTOR:
    Frank C. Carlucci                     Dec.     1970     Present
    Donald Rumsfeld                       May      1969     Dec.    1970
    Bertrand M. Harding     (acting)      Mar.     1968     May     1969
    R. Sargent Shriver                    Oct.     1964     Mar.    1968

ASSOCIATE DIRECTOR, OFFICE OF
  HEALTH AFFAIRS:
    Carl A. Smith, M.D.                   May      1971     Present
    Thomas E. Bryant, M.D.                Sept.    1969     Apr.    1971

ASSISTANT DIRECTOR, OFFICE OF
  HEALTH AFFAIRS (note a):
    Thomas E. Bryant,  M.D. (acting)      Jan.     1969     Sept.         1969
    Joseph T. English,  M.D.              Mar.     1968     Jan.          1969
    Julius B. Richmond, M.D.              July     1966     Mar.          1968

ASSISTANT DIRECTOR FOR COMMUNITY
  ACTION PROGRAMS(note a):
    Theodore M. Berry                    Apr.      1965     Sept.         1969

PROJECT MANAGER, HEALTH SERVICES,
  COMMUNITYACTION PROGRAM
  (note a):
    Gary D. London, M.D.                 Apr.      1968     Aug.          1969
    John Frankel,  D.D.S.                July      1966     Apr.          1968

aIn September 1969 these offices      were terminated   as organi-
 zational entities   in a major reorganization      of OEO. At
 that time the various health activities       of OEO, including
 the Comprehensive Health Services Program, were combined
 in a new Office   of Health Affairs    while the majority    of
 other Community Action Program activities       were shifted    to
 a newly created Office    of Operations.
                                                          U.S.   GAO,   Wash., D.C.

                                  54