This paper examines major features of the National Health Planning and Resources Development Act of 1974 (P.L. 93-641), a piece of legislation that would radically restructure the health planning system of the United States. The Act combines several, previously uncoordinated, health planning and health resources development agencies into one coordinated program. The program is to consist of a statutorily restricted federal agency which will generally oversee the operation of the program, a state program directed by a consumer-dominated board and a series of locally based, generally private, nonprofit, consumerdominated corporations (“Health Systems Agencies”) which will carry the bulk of the planning functions.

The resource development portion of the act grants funds for a variety of programs. These include both grants and loans (at very favorable interest rates) for medical facilities. In addition there are funds available for innovative projects which hold the prospect of improving health services and environmental conditions within the community.

The act also provides the states and local organizations with substantial power over a large portion of the allocations made under the Public Health Act and specifies the process by which health planning must be carried out. Each local planning agency must design a long range health plan for its community and prepare a one-year plan for carrying out portions of the health system plan. These two documents then are used to create State Health plans, plans for construction, modernization or conversion of health facilities and criteria for judging the appropriateness of health services offered in the local areas and in each state.

The act seems to create a mechanism whereby the health industry could be quickly converted into a heavily regulated industry. This regulatory process could be implemented in conjunction with national health insurance or by itself.

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