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April 1969
LENCTH OF EXTENSION AND LEVELS OF: AUTHORIZATION

The length of the legislative extension and particularly the new
authorization levels will be major factors in the determining the future
of Regional Medical Prograins. In writing the legislative proposal, the
Division has the option of requesting a specific time extension (e.g.,
three years, five years) or may leave the time period open-ended.

Similarly, the authorization levels requested may be set at specific in-
eremental amounts or may be stated indefinately as "such amounts as —
Congress may wish to authorize."

RMP is now at a critical stage. Fifty-five Regions have been organized
and over thirty have become operational, albeit most of these quite recently.
Competent, professional staff have been employed by the Regional Programs
and they are working with the medical schools and providers of health care
to develop meaningful operational projects. Unless these persons and
groups can expect extension of the program for a reasonable length of time
(3 or more years) and funding at levels that will permit orderly and
adequate growth, they may find it difficult to continue their commitment.
Potential project sponsors and participants need to know whether RMP will be
a continuing viable force in their community and whether projects now under
discussion stand reasonable chances of being funded. Without reassurance of
programs stability and growth, they may turn to other endeavors or sources
of support.

Funding requirements rising to $500 million by 1973 had been projected
a2

some 18 months ago. These estimates of "aggregate effective demand" for
operational grants were based on initial experience with operational grant
requests, extended to all Regions and projected to 1973. DRMP staff is
now involved in updating and refining these projections and a more firm
projection will be available this summer. Preliminary data indicates that
the original estimate of $500 million within 3-5 years is not excessive or
unrealistic. For example, operating experience to date has shown that
those Regions that encompass the major metropolitan areas of the country
have moved ahead much more slowly than have the other Regions. It is
anticipated that when the large, complex metropolitan Regions begin to
reach a program level reflective of the needs of their major population
centers the demand for funds will be sharply increased.

While staff is working on the technical aspects these budget projections
and the authorization levels necessary to support them, it will be necessary
to work out an overall strategy for their presentation to Congress. A
number of issues will have to be met, including the fact that RMP has re-
ceived appropriations less than the amount authorized and until this year
has ebligated less than the amounts appropriated. It must be explained why
program development, particularly in complex metropolitan areas, was some-
times slow and why this is not likely to continue. RMP has a high ratio
of expenditure for core activity to project activity. It will be necessary
to justify how this core activity differs from routine program administration

and how it contributes in its own right to the improvement. of health care.