in Madrid, a satellite clinic was initiated. The Family Practice Clinic is staffed by myself, 1 nurse and a receptionist under the supervision of Drs. Rouse and Anderson in Boone, 14 miles away (supervision includes by-weekly visits, continuing daily chart supervision and a communication system including radios, telephone, and the County Hospital Ambulance Service). Madrid is a rural community located in central Iowa with a population of approximately 2,200. In Madrid there is a 150 bed nursing home and a 22 unit senior housing project. Our satellite office is the sole provider of medical care for this community. I would, at this time, refer you to Mrs. Sally Sundberg's testimony which gives an indepth look into the history of medical care availability in our community. I might note that I reside with my wife and 2 children in Madrid.

As a direct extension of Drs. Rouse and Anderson, I render care to over 2,000 active patients, representing a typical cross section of all ages, economic productivity, coupled with the overwhelming desirability of locally available medical care. This care, although not all inclusive, includes health maintenance, preventative medicine, with emphasis on family practice including acute care under any and all circumstances. This satellite office is currently part of a social security's administration research study allowing reimbursement to the physician for care rendered by myself to the elderly patients eligible for Medicare assistance. Only because of this study is it possible for; 1) this satellite office to continue operation as the sole provider of medical care in Madrid; 2) for the ambulatory elderly to receive medical care without prohibitive out-of-pocket costs; 3) for our local 150 bed nursing home to keep its doors open with the availability of immediate emergency medical care through my utilization by my supervising physicians which includes a weekly clinic visit.

An explanation of the delivery of health care specifically to the residents of the local nursing homes prior to the initiation of the satellite office here in Madrid may be helpful in gaining insight into cost of care. With no medical telephone, at times difficult due to tremendous overload and a busy practice. service available to the community prior to 1973, and given the following limitations to the following example, a nurse in her usual competent and professional manner would recognize that an acute problem, in this case pneumonia, was apparent, would contact a physician in Boone (14 miles away) by Once this feat was accomplished and the physician convinced that the patient was indeed in need of immediate care, an ambulance would be dispatched from the local county hospital. The patient would be seen in the outpatient department, rendered care, and in this example, without a hospital stay, would be transported again by ambulance back to the nursing home. The cost for this care would exceed $100. In comparison within the past month, I was notified of a similar problem by the nurse in the nursing home. Within a very short time after examination of the patient and phone consultation with my supervising physician, definitive diagnosis and treatment was initiated. The actual charge was $30 and in reality, actual cost was $20 after Medical assignment was accepted.

As a Physician's Assistant, I do not consider myself a replacement physician. I have long and often proposed that the complete answer to the availability of medical care in rural areas is more physicians. I would, although, like to, at this time, direct your attention to addendum 1 to this testimony entitled, "Medex and Their Physician Preceptors, Quality of Care", from a department of family and community medicine, University of Utah, College of Medicine, Salt Lake City, published in the journal of the American Medical Association, Nov. 29, 1976, Vol. 236, No. 22. In summary of which when outcomes of care were determined in 13 practices with a Medex and a Preceptor, the patients seen by the Medex (Physician's Extender) tended to fair about as well as those seen by a physician (71% vs. 74%, respectively) in regaining their usual functional status. The addition of a Medex (Physician's Extender) to a rural practice may thus produce both direct and indirect benefits.

Concerning a brief overview of what is happening in Iowa, I call your attention to the hearings before the subcommittee on rural development of the committee on agriculture and forestry of the United States Senate, 94th Congress, 2nd Session, presided by Senator Clark on October 12, 1976 in Grimes, Iowa entitled, "Rural Health Services in Iowa". Senator Clark's astute and

direct ability in recognizing problem trends in Iowa was correct. Reading directly from HEW's statistical charts concerning the percent increases in physicians by geographic division in state in the United States between 1968 and 1973.

Mr. Clark; "These are the latest figures we could get. In other words, how much in Iowa, as compared to the rest of the nation-what kind of percent : increase in physicians have we had? Unfortunately, we are 49th among the 50 states. This is increased number of physicians in the state. We have had, in that 5 year period, a 6.3% increase The national average is 16.7% so that we are well below half of the national average in terms of increasing physicians into the state.

There is one state lower, and interesting enough, it is South Dakota, and it is much lower, 1.4%. We are second lowest, 6.3%, and then they are all the ! way up to New Hampshire, which must be the climate, 26%, so that I noticed in passing that Mr. Pustka said that he felt the final answer was not simply Physician's Assistants, but doctors themselves and if these figures are still accurate over the past 22 years, these trends, it means that we have a real problem in terms of physicians as well".

Yet extensions of the primary care physician in rural Iowa, specifically through the utilization of Physician's Assistants, has proven to be an immediate and direct workable facet of the problem of health care availability in rural Iowa.

Quoting Denis R. Oliver, Ph.D., director Physician's Assistant Program, University of Iowa: "Let me highlight certain points. To date, we have graduated 45 Physician's Assistants with B.S. degrees conferred by the College of Medicine. Thirty-two (71%) are currently employed in Iowa. Each year we accept between 20 and 25 students to enter the 2-year program. This program has scored among the top 5 programs in the country (out of 52 programs) on the national certification examination for Primary Care Physician's Assistants for the last 2 years.

We are proud of our program and the caliber of our graduates. We feel they will have increasing impact on rural health delivery systems, but only if appropriate legislation exists which allows for their optimum utilization. The position of the social security administration on third party reimbursement for Physician's Assistants services to Medicare patients is ridiculous. On the one hand, the government budgets enormous sums of money for the initiation and continuation of Physician's Assistants training programs, and on the other, severely restricts their utilization. This is of particular concern in Iowa which has a large elderly population. I think it criminal that these people are abandoned at a time when they should enjoy the fruits of heir labor".

Both Senator Clark and Dr. Oliver's comments adequately summarize specific issues concerning availability of health care in Iowa. Again, not a complete answer, the Physician's Assistant's utilization under adequate supervision by practicing physicians is a partial immediate, even longterm answer to the frequently forecasted worse physician shortage for the future in rural areas. Specifically, in Iowa, one-third of the counties lost Primary Care Physicians in the years from 1974 to 1976 alone. At the same time, only about 4% of the recent medical graduates have chosen to practice in rural areas. These stark facts coupled with enumerable practices (for example, generally lower fees given to physicians in rural areas compared to urban areas by both private and public health insurance programs) and the obviously contradictory reimbursement system of Medicare disallowing the utilization of Physician Extenders (who have been proven, can substitute under adequate supervision for the declining number of physicians in rural areas) is presently compounding what is considered by many to be an acute medical crisis. The populus of Iowa has been historically fortunate in that the availability of medical care through a high caliber and standard of Iowa physicians, private and county hospitals, and the University of Iowa Hospital system, has been available. The problem boils down to one of entry into the system. The Physician's Assistant has shown to be an available, competent entry into an excellent medical system where otherwise an entry was not readily available. I conclude that the serious responsibility shared by the subcommittee on rural development in its recommendations and support of legislation along the

lines of S. 708 will be felt immediately and in the future by many if not all of our friends and neighbors. I respectfully submit the following suggestions: 1. S. 708 is glaringly lacking and limited in its reimbursement to rural medical clinics in medically underserved areas at cost. Reimbursement to physicians practices for services rendered by the Physician's Assistants in any and all areas should and must be priority. The availability of primary medical care to the people in the core cities and other areas is just as real, just as acute, as that of the rural areas. Reimbursement as I've just outlined may be compromised and/or facilitated by a reimbursement program discounted from that of the physicians usual and customary (80%?) when the care is indeed rendered through the Physician's Assistant.

2. The concept of medical care rendered by a Physician's Assistant was born in the realization that all care rendered by the Physician's Assistant would be under the supervision of a physician who ultimately would hold both moral and legal responsibilities completely. This concept is the underlying premise on which the extender concept remains workable. The Physician's Assistant is only as good as the supervising physician. In my interpretation of S. 708, I have to agree in part with Dr Beddingfield (Chairman of the AMA Council on Legislation) in that by this bill's definition, clinics cannot be physician directed or under direct personal physician supervision covering only certain types of state health clinics. This, in my estimation, may leave a door open to widespread, if not dangerous abuse of our Medicare system. The Physician's Assistant must remain a direct extension of his supervising physician and should at all times be directly answerable to and employed by a physician and very close supervision of the extender by the physician be encouraged. The original concept as outlined by our congress must be continued and fostered in that ultimate responsibility of the Physician's Assistant must rest with his supervising physician.

3. The fee schedules which discriminate against rural practice must be erased. Routinely, insurers, including titles XVIII and XIX pay higher fees to urban doctors than to rural doctors for the same work. Urban doctors have offered convincing arguments for their higher fees, but the difficulty in getting doctors into rural practice is an adequate answer to all such arguments.

4. A priority commitment to seek a successful program to increase physicians availability in rural areas should be continually explored. Positive programs such as tax credits for "area practice", encouragement of utilization of Physician Extenders through adequate reimbursement programs, and family practice residency programs by state universities with preceptorship training in rural communities have all been positive directions. An important negative direction has been the utilization of "short time doctors". Schemes to get doctors to rural communities for short periods of time, including 2-5 years, have a tendency to attract inferior physicians and is insulting to the rural population. Rural practice is a specialty and a career.

I accepted this invitation to testify as an honor and would, at this time, like to conclude with a thank you forwarded by many residents of Madrid for your time, concern, and apparent wish to insure, through effective and farreaching legislation, availability of medical care; hopefully, irregardless of a person's age, ability, disability, or geographic locality.

STATEMENT OF BETSY DAVIS, EXECUTIVE DIRECTOR, VISITING NURSE ASSOCIATION, INC., BURLINGTON, VT., AND CHAMPLAIN ISLANDS HEALTH CENTER, GRAND ISLE, VT.

I am Betsy Davis, Executive Director of the Visiting Nurse Association, Inc., located in Burlington, Vermont, serving Chittenden and Grand Isle counties. I am also project director of the Champlain Islands Health Center, a rural health center operated by the VNA and the Grand Isle County Health Council. I am pleased to have the opportunity to appear before you today to discuss S.708 and the implications of that bill as it affects the financial viability of the Champlain Islands Health Center.

I wish to present you with the background in creation of the Health Center, a brief description of the system of care, a description of a pilot reimburse

ment project with Blue Cross/Blue Shield and the potential effect of S.708 if implemented.

BACKGROUND

The Champlain Islands Health Center is located in Grand Isle County in Northwestern Vermont. The county is composed of a peninsula that leads to Quebec Province in Canada and is a series of islands in Lake Champlain which is connected by a sand bar and bridges. It is approximately 40 miles in length and three miles wide at its widest. The population is approximately 3,750 but swells to 12,000 during the summer tourist season. The mortality rates show that there are higher rates in comparison with the rest of the State of cardiovascular and respiratory disease, cirrhosis of the liver, and accidents. Women die sooner than men with the mean age of the former at 66 and the latter at 70. The population characteristics and economics of the area probably typify many rural areas, such as: 58% of the population of Grand Isle County earns less than 200% of the poverty level; last winter's unemployment rate was over 17% of the work force, 28% of the population presently utilizing the Health Center have no form of health insurance of any kind, and only 15% are Medicaid eligible. Many are only marginally employed.

Historically, solo physicians have come and gone in the county with none being able to support a comprehensive practice over an extended period of time. The last physician in primary practice offered services two afternoons a week in the northernmost town of Alburg (also the largest town) and practiced surgery at a hospital in another county the remainder of his time. He has now discontinued his services in Alburg. There is an osteopath in the southern part of the county offering episodic illness services to a limited population. VNA initial experience in Grand Isle County was with a mobile unit pediatric screening service in 1972. The data base collected there showed that 32% of the children presenting at the mobile unit did not have a source of preventive care; 45% of the children presenting had irregular patterns of utilization of preventive services. Utilization of the mobile unit services by the preschool population was 50%-90% in the various towns in the first year of operation. Patterns of health care by adults were fragmented and inadequate with many naming 3 or 4 physicians that they would turn to depending on who was available. Almost no one had a record of his or her problems, medications, or plans.

DESCRIPTION OF THE SYSTEM OF CARE PROVIDED BY THE HEALTH CENTER

Our major goal in establishing the Health Center three years ago was to provide a coordinated integrated system of health care that is available, accessible, and accountable to the people of Grand Isle County. The important features of the Health Center are: 1. consumer involvement and governing responsibilities; 2. utilization of nurse practitioners as primary caregivers with back-up physician availability through telephone consultation and periodic on-site visits; 3. the linkages to the rest of the health care system; 4. that it is cost effective; 5. that services focus on prevention and health education; 6. that it is accountable.

I would like to address each point briefly.

It was through the initiative, support, and many ongoing volunteer hours of the County Health Council that the Health Center was established in 1974. It was they who asked if we could keep the nurse practitioner from the mobile unit on a daily basis and expand to adult services. This group now has responsibilities for program and services planning, budget and contract approval, evaluation and other policy determinations. In addition, a consumer advisory committee has been created which makes recommendations to the Health Council on needs for services and provides a feedback mechanism for patient complaints. The VNA and other involved agencies support this local responsibility believing that health care providers must be accountable to the people we are trying to serve. This increased involvement will also lead to increased responsibility, greater self direction and hopefully more demand for a system of health care to which people are entitled. It is for this reason that we believe that a certain, defined level of health care should be community based and located where people live.

We believe that transporting people 30-60 miles to health services they have no responsibility for is self defeating.

Nurse practitioners and a paramedic staff the Health Center daily. They perform preventive maintenance exams for infants, children and adults as well as treatment of acute or chronic illness by protocol or telephone con'sultation. Each patient identifies a physician who may be located either in Franklin County or Chittenden County with whom the nurse practitioner communicates and to whom she sends records. Consulting and medical/legal back up are provided by contract physicians who are available by telephone and who are on site once a week to perform record audit, establish protocols and see patients with the nurse practitioner on a consulting basis. There is an evening and night answering service with a tie-in to physicians at the "Villemaire Health Center located in Milton, and Given Health Center, both affiliates of University Health Center. VNA home care services are operated out of the Health Center and coordinated with ambulatory services.

The nurse practitioner concept has been well accepted. Almost 800 people 'made 2,240 visits to the Health Center in its first year of operation when it was open four or five half days per week. 98% of all acute pediatric problems and 93% of all acute adult problems were cared for on site. The remainder were triaged outside of the county. The second year showed a 34% growth.

The nurse practitioner serves as an extension of the health care system providing an entry point to total care. She is part of a larger support system. It is our task to 1) define those primary care services that can be provided on site in Grand Isle County considering the population base, the population problems, and economics of the area, and 2) provide a consistent and reliable service on site and guide the patient through the rest of the health care system.

Again, critical to that system is the involvement of the patient as the coordinator of his or her own care. This means full knowledge, understanding and participation in health care. Patient education and the problem oriented health care record in the patient's possession are central to this concept and practiced at the Health Center. We believe that nurse practitioners, by their professional education and focus on prevention, are best prepared to provide these important components of education and guidance necessary in primary care. This should mean more appropriate utilization of health services, less duplication and greater efforts toward self help. This should also mean increased levels of expectations on the health system and greater accountability. The average cost per visit in the Health Center the first year was $11.55 after deducting developmental expense and $12.50 in the second year. These figures included all screening and laboratory tests also done at the Center. For the people utilizing the Center, there were additional savings when travel expense, loss from work, and child care concerns are considered.

During the second year we had great concerns about our ability to continue the Health Center for financial reasons. The first year had been financed through a Manpower HEW grant, Kellog funds, and Health Department support as well as patient fees. The second year showed a continuation and carry over of some of those funds, and Regional Medical Program funds were received; but we operated on a shoestring basis. It was painfully clear that third party reimbursement for nurse practitioner services when an M.D. was not on site was a critical issue in the continuation of the Center. If the "problem of third party reimbursement could not be solved, then the nurse practitioner as an extension of the health care system in rural areas was not viable. Yet, we felt we had been able to create a quality service that was acceptable, accessible, accountable and cost effective. Fortunately, we were awarded a Rural Health Initiative grant from Region I HEW July 1, 1976, giving us more time and ability to further develop the system and to work toward improved reimbursement.

We realize that grants cannot be a long term solution and that the Health Center must fit in with the prevailing methods of reimbursement.

BLUE CROSS/BLUE SHIELD REIMBURSEMENT PROJECT

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A major innovative step has been taken by Vermont/New Hampshire Blue Cross/Blue Shield in addressing the reimbursement of services provided by