This paper traces the implementation of Michigan's program for hospital bed reduction through four phases in the critical first 30 months following enactment: standard-setting, plan development, plan approval, and legislative oversight. Procedural complexity and goal conflict complicated implementation from the start: what began as a simple proposal to close unneeded beds soon became enmeshed in efforts to address longstanding issues of equity in access to care. A combination of administrative, political, and economic factors peculiar to Michigan, as well as the more generic problems incurred in applying a regulatory approach to containing medical care costs, contributed to the difficulties encountered in implementing bed reduction. Long-range prospects for the program depend upon whether the modest results it is likely to achieve are deemed to be worth the costs incurred in administering it.

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