expenses have exceeded income from the beginning. Currently the annual deficit runs between $8,000 and $14,000 annually. This is made up by appeals to the several branches of the Royal Canadian Legion through the Provincial command. Admissions are limited to those who have an annual income of not more than $2,200 if single, or $2,800 if married. Applicants are screened carefully by the superintendent, and he insures that all occupants in single-family units are persons capable of caring for themselves or if in a double unit that one of the two occupants is able to care for himself and partner. Eight of the 12 buildings contain 12 apartments each-4 for single-person occupancy and the other 4 for double. The remaining four buildings contain eight apartments each-two for single-person occupancy and two for double. Single units rent for $43.75 and double for $51 monthly. Authority has been received from the Central Mortgage & Housing Corp. to increase all rentals by about $4.40 monthly, but the Legion feels that it should not raise rents except as a last resort and will continue to attempt to cover deficits by appeals within their organization. The project currently has no waiting list-the first time since opening in November 1958. The rate of turnover has been less than 4 percent annually, and most vacancies have been the result of deaths. Two marriages produced vacancies in the single units. The 12 buildings are located on 4 acres of land in a residential community. A new school is being completed across the street from Vetville's community building. The units have an 11- by 17-foot living room, and the double units have in addition a 10- by 10-foot bedroom. The kitchens are 6 by 8 feet, each equipped with an exhaust fan, a refrigerator, small three-burner ranges, and venetian blinds. Three-piece baths in each unit range from 6 by 6 feet to 6 by 11 feet. All apartments have built-in ironing boards, clothes closets, broom closets, and linen cabinets. Storage space is entirely adequate. Each building contains two hot-air fuel oil furnaces, and thermostats are located in hallways. Coin-operated washing machines are available, and laundry tubs are included but no driers. Garbage is picked up twice a week during the summertime, and garbage cans have been furnished by the local Legion branch. Five units were visited, and all occupants seemed very happy with their living quarters. Each was very pleasant with the project superintendent, A. R. Mitchell, and none had any criticism of the management, shopping facilities, transportation, or any other aspect of the development. This project includes a community building which was not financed in any part by the federal government. The total cost of the 34- by 74-foot brick structure was $43,000, of which the Provincial government of Quebec granted $22,500. The balance was raised by branches of the Royal Canadian Legion throughout the Province of Quebec. Furnishings for this building were donated by the local Legion branch and other community organizations. The community building has a library, meeting place for 100 people, serves as a post office, and includes living quarters for the project superintendent. It has a bulletin board on which are posted various activities scheduled in the building. This includes bingo games, cards, carpet bowling, meeting of the Vetville Men's Club, etc. The building is also used by local organizations such as the PTA. It serves as a polling place during elections. OREGON PHYSICIANS' SERVICE, BLUE SHIELD, Portland, Oreg., June 22, 1962. Hon. OLIN E. TEAGUE, Chairman, Committee on Veterans' Affairs, DEAR MR. TEAGUE: Thank you for the inquiry about our outpatient drug endorsement. The benefit is offered as an extra-cost option on our standard contract for groups of eight or more employees. Briefly, these are the terms of the endorsement: (1) The benefit applies only to drugs or medicines prescribed in writing by a physician as specific therapy in the treatment of an illness or injury covered under the group contract; (2) Payment begins with the 11th dollar of expense in each new case. The initial $10 is not covered; (3) The plan pays 80 percent of the cost, up to a maximum of $100 per year for each employee and dependent; (4) The endorsement does not cover refills without written prescriptions, barbiturates, tranquilizers, estrogenic or vitamin preparations, or obesity remedies. Originally, the endorsement was limited to drugs available only by prescription. This limitation was dropped because it proved administratively impossible. It is apparently difficult even for a pharmacist to determine whether certain drugs are "prescription only" items. The rules are changed frequently, and often the pharmacist must base his decision on his and the physician's good judgment. We have also encountered problems in finding out whether a particular drug was actually prescribed by a physician, what condition the physician prescribed the drug for, and which member of the family required it. If the volume of claims under this benefit reaches a significant point, we will create a special "proof of loss" form, giving the member a convenient method of accumulating the information we need. As yet, however, the volume has not been great enough to warrant this step. We have offered this benefit to all our groups for the past 4 years but acceptance has been minimal. Only three or four groups purchased the option when it was first offered and only one or two continue to carry it at present. Monthly dues for the outpatient drug endorsement are as follows: Employee--- Employee and 1 dependent__. Employee and 2 or more dependents-- $0.30 .50 .80 We do not yet have enough financial experience with the benefit to say whether or not the rates are adequate. Preliminary figures indicate that the rates can probably be reduced, but we will need a much larger sample before we can make a conclusive statement. This benefit was initiated as an experiment, and at this point we have reached only two tentative conclusions: 1. The provision of outpatient drugs through the prepayment mechanism is fraught with unexpected administrative problems. 2. The demand for outpatient drugs as a health insurance benefit is not nearly so strong as is generally believed. If there is any other information I can give you, please let me know. Very truly yours, R. L. BUNNELL, Administrative Assistant. OREGON PHYSICIANS' SERVICE, BLUE SHIELD, Portland, Oreg., May 20, 1963. Subject: Outpatient drug benefit. Chairman, House of Representatives, Committee on Veterans' Affairs, MR. TEAGUE: Your inquiry about our prescription drug benefit has been forwarded through Mr. Patterson of your committee and Mr. Rollins of the local veterans' hospital. We have no information more current than that in my June 22, 1962, letter. Our exposure on this program during the past year has been too small to generate valid experience. If there is any other way in which I can help you, please let me know. R. L. BUNNELL, Administrative Assistant. [From Hospitals, Apr. 16, 1962] ANNUAL ADMINISTRATIVE REVIEWS-CARE OF THE CHRONICALLY ILL AND AGED Listing and accreditation of nursing homes gains momentumBroader pattern of community services for the aged emerges-Hospital-nursing home agreements provide better chronic care. (By Herbert Shore) INTRODUCTION Unquestionably the most significant single event in the field of chronic illness and aging was the White House Conference, which brought to a conclusion, in January 1961, several years of planning and participation at local and State levels, in national organizations and within the Government. The single most significant issue continued to be the health care of the aged, with all its legislative ramifications and ideological differences over the method of financing and payment. Several other trends were discernible also. These included: (1) An emerging pattern of broader community planning and services for the aged and broader use of area and regional planning. (2) Emphasis on programs of health services to older persons in their own homes. (3) An intensified program of listing of inpatient institutions other than hospitals and a movement toward accreditation of nursing homes. (4) Development of hospital-nursing home agreements. (5) Emphasis on programs of inservice training and education for personnel caring for the aged. (6) Establishment of a national organization of nonprofit homes for the aged. In January 1961, the first nationwide conference ever held solely to consider the needs of the aged and aging was convened in Washington, D.C.1 Congressional action to call the White House Conference on Aging recognized that elderly persons in the United States total about 16 million, and that the number has multiplied five times since 1900 and will double again in the next 40 years. People live longer today than they did a few decades ago; they spend more time in retirement from their vocations, and they suffer more chronic illnesses. The gathering of 2,700 delegates from 50 States, the District of Columbia, and 3 territories considered the challenges implied in meeting the financial, medical, social, and emotional needs of the growing geriatric population. Critics of the conference have said the whole affair, held in the closing days of an administration without time to act and with the incoming administration keeping aloof, was meaningless and just so much shadow boxing. Others are inclined to agree with the view expressed by Representative John E. Fogarty, The hospital-nursing home affiliation is one approach to the problem of more effective utilization of available facilities, personnel, medical care and resources for better care of chronic diseased and disabled patients, the author states. He outlines the major program objectives of the Illinois Hospital Association in promoting such affiliations in that State. The guide for hospital-nursing home affiliation, adopted by the Illinois Hospital Association, was prepared because of the association's interest in promoting closer relationships between hospitals and nursing homes in the State. Through such close relationships, the IHA hopes to stimulate at the local community level (1) better continuity of care for patients with chronic and disabling conditions; (2) more effective utilization of available institutional facilities: (3) more effective pooling of resources to provide specialized services and per 1 White House Conference on Aging. Geriatrics 16: 111 March 1961. a Leonard P. Goudy is the president of the Illinois Hospital Association and the administrator of Proctor Community Hospital, Peoria, Ill. At the time this guide was prepared, he was chairman of the IHA's committee on care of the aging. sonnel so that they can be available to nursing home as well as hospital patients, and (4) better care at the lowest possible overall cost to the community. The IHA recognizes that differences in conditions and needs will dictate substantial variations in approach, but the association believes the guide includes the principal factors to be considered by hospitals and nursing homes when an alliance is contemplated. This statement, therefore, reflects the successful experience of a variety of existing hospital-nursing home affiliations. PRINCIPLES AND OBJECTIVES A community's health needs are best met when the community has good facilities for health care and when these facilities are readily available as needed under a coordinated utilization plan. When facilities are in more than one location and operated under different auspicies, as a hospital and a nursing home, an integrated plan based upon their voluntary affiliation can improve the quality and economy of the community's overall medical care. Minimal standards for affiliating nursing homes should include, at least, licensure by the State or province and listing by the American Hospital Association, or other equally satisfactory qualification. Physicians must be involved from the beginning, both those from the hospital's staff and those from the home's, if it has any. They should join their institutions in developing and operating any affiliation plan. The primary responsibility for admitting, transferring, and discharging patients, as well as providing medical care rests with the physicians. Their full understanding and organized support of any plan is essential. Affiliation is designed to provide free flow of patients and services between affiliates. The plan, in effect, pools patients and facilities, admits or transfers patients to the affiliating institution which can most economically provide the care needed by each and then makes available for each patient's care the services he may need regardless of location of the service facility. The primary objective of affiliation is to enable an acute general hospital and a skilled nursing home to organize and pool their respective health care resources so that patients initially admitted to either will receive the best quality of care available in the community at more reasonable cost. "Organize and pool" indicates an affiliation plan operated under mutual agreement. "Respective *** resources" implies that each affiliate has its own distinctive health care assets and attributes. The hospital, for example, has a plant which is designed, equipped, and staffed to care for acutely ill patients. It has many types of skilled technicians, and there is an organized medical staff. The hospital represents high-cost investment and operation. The skilled nursing home, on the other hand, is designed, equipped, and manned to meet the needs of convalescent and chronic patients in a relaxed congenial environment. It represents a relatively low cost investment and operation which is one of its greatest values to the community. "Best quality of health care available" includes assurance that the patients' health care is supervised by competent physicians and nurses, and that these needs are met whether they are medical, skilled nursing, dietary, or therapeutic. This requires the availability of diagnostic services, such as clinical laboratory and X-ray. It also implies rehabilitation services. If the staff and resources for such services are initially lacking, a plan for ultimately providing them should be stated in the affiliation. There is continuity of care from admission to final discharge, regardless of a patient's transfer between affiliating institutions in the interim. The separate identity and integrity of each affiliating institution is maintained. Legal counsel reviews the content and mechanism of affiliation to prevent jeopardizing the charitable status of not-for-profit affiliates. ARTICIES OF AFFILIATION Articles of affiliation define the operational relationships between the affiliating institutions. These generally describe (1) the plans by which each institution helps the other to provide good standards of patient care; (2) the plans for transferring patients and services between institutions, and (3) the basis and schedules for billing and paying for such services. The articles are in written form and must be endorsed by the hospital's board and medical staff and by the nursing home's administration, its board or owners and its medical director or medical staff, if such exists. The articles of the agreement are subject to review, revision, or cancellation upon reasonable notice. ELEMENTS OF AFFILIATION The elements of affiliation between the hospital and nursing home include the following: Patient transfer (1) Each affiliate strives to give priority to admission of patients transferred from another affiliate; on occasion this may be impractical. (2) Each transfer is to be preceded by a medical and a nursing discharge conference of representatives of both affiliates to assure continuity of patient care and by an exchange of information essential for planning subsequent care. (3) Each affiliate is to be responsible for billing and collecting all patient charges incurred while patients are resident in its institution. (4) Legal responsibility for patients generally rests with the affiliate of residence, but responsibility for services rendered patients rests with the affiliate directly performing the service. Specifically, the nursing home rather than the hospital is liable for nursing service, even though its nursing standards may be under the overall supervision of the hospital's director of nursing; the hospital's laboratory and its pathologist are liable for making and evaluating clinical tests, even though the patient is a resident in and under the responsibility of the nursing home. Continuity of medical care (1) Medical care of all patients in all affiliating institutions is under the general supervision of a medical staff organized under written bylaws, rules, and regulatons and including a pathologist and radiologist. This means supervision by the hospital's medical staff, unless the affiliating long-term institution has its own medical staff. This supervision is implemented by a schedule of minimal standards which specify frequency that each patient must be seen by a physician; availability of members of the hospital's medical staff for consultation, and maintenance of a medical record for each nursing home patient. This includes at least a medical history, report of physical examination diagnosis, physician's orders and progress notes. Nurses' notes in the record include progress notes, medications and treatments given. (2) Medical services rendered to hospital or nursing home patients by physicians are billed by them directly to the patient served. (3) Medical services rendered to any affiliate's medical program, such as participation in staff meetings, the development of standing orders and par ticipation in medical audit or utilization reviews, are contributed services for which no billings is made by the physician. Continuity of nursing care (1) Nursing care of all patients in all affiliating institutions is under the guidance of the hospital's director of nursing, unless an institution's nursing service is already supervised by a competent registered nurse. Minimal nursing standards specify nurse staffing under the supervision of a registered nurse, control over medications and treatments, maintenance of the nursing chart in the medical record on each patient and availability of the hospital's nursing staff for consultation, including consultation on inservice training. (2) Nurses' services rendered are billed by the employer institution to the affiliate served on the basis of time, the rate to be agreed upon in advance. Dietary care (1) Diets are prescribed by the organized medical staff. (2) Standards of dietary care in affiliating institutions are established in consultation with the hospital's dietitian, unless the affiliate has the services of its own dietitian. (3) Services of the hospital's dietitian are provided the affiliating institution and billed for by the hosptal at prevously agreed upon rates. Other services (1) Administrative assistance may be given with accounting, personnel, insurance and third party payments, admitting, purchasing and inventory control, engineering, etc. Any charges for services in these categories are to be determined at the time of affiliation. (2) Professional assistance may be given with medical records and statistics, clinical laboratory, X-ray diagnosis and therapy, physical and occupational therapy, social service, pharmacy, etc., for which charges are established at the |