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outside the institutional structures outlined here, are not covered by this
work. Veterinary education and research, however, are included because
they are integrated within the U.S. health care institutions as defined above.

6. "Is the Business of Medicine Business?" New York Times Book Review, 5 April
1992, 11.

7. A health maintenance organization (HMO) is a comprehensive system of
therapeutic and preventative health services that are provided to an enrolled
population for a fixed per-person sum.

8. Russel C. Coile, Jr., The New Medicine: Reshaping Medical Practice and Health Care
Management (Rockville, Md.: Aspen Publishers, 1990), 240.

9. Stephen J. W^illiams and Paul R. Torrens, Introduction to Health Services (New
York: John Wiley & Sons, 1984), 164.

10. Roemer, U.S. Health Care System, 6.

1 1. Anthony R. Kovner, and contributors. Health Care Delivery in the United States,
4th ed. (New York: Springer Publishing Company, 1990), 306.

12. United States Government Manual, 1989-90 (Washington, D.C.: U.S.
Government Printing Office, 1990).

1 3. Williams and Torrens, Introduction to Health Services, 172.

14. Joellen Watson Hawkins and Loretta Pierfedeici Higgins, Nursing and the
American Health Care Delivery System (New York: Tiresias Press, 1982), 34.

15. Rosser and Mossberg, Health Care Delivery, 2S, and Kovner, Health Care
Delivery, 123.



1 2 OVERVIEW OF THE U.S. HEALTH CARE SYSTEM



16. The Foundation Directory (New York: Foundation Center, 1989), Introduaion.

17. Hawkins and Higgins, Nursing, 111.

18. See page 33 for the definition of a teaching hospital.

19. Rosser and Mossberg, Health Care Delivery, 33-34.

20. Hawkins and Higgins, Nursing, 45.

21. Adapted from Roemer, U.S. Health Care System, 9, and Rosser and Mossberg,
Health Care Delivery, 29, 32-33.

22. "The Hospital World's Hard-Driving Money Man," New York Times, 5 October,
1993, Dl.

23. The five are Beth Israel, Brigham and Women's, Children's, Massachusetts
General, and New England Deaconess hospitals.

24. For more information on academic health centers, see Chapter 5.

25. "A $4 Billion Supply Deal for Hospitals" New York Times, 26 Oct 1993.



ANNOTATED SELECTED BIBLIOGRAPHY

For an excellent history of medicine in the United States,see Paul Starr, The Social
Transformation of American Medicine: The Rise of a Sovereign Profession and the
Making of a Vast Industry (New York: Basic Books, 1982). This volume, which
won the 1984 Pulitzer Prize for general nonfiction, traces the origins of
medical practice through the growth of corporate medicine, from 1760 to
1980.

A highly recommended source that describes the basic elements of the U.S. health
care system and their interaction is Anthony R. Kovner, and contributors
Health Care Delivery in the United States, 4th ed. (New York: Springer Publishing
Company, 1990).

Other good sources that describe the U.S. health care system include Steven Jonas,
An Introduction to the U.S. Health Care System (New York: Springer Publishing
Company, 1992) and David Barton Smith and Arnold D. Kaluzny, The White
Labyrinth: A Guide to the Health Care System (Ann Arbor, Mich.: Health Admin-
istration Press, 1986). "Historical Evolution and Overview of Health Services
in the United States," chapter 1 in Stephen J. Williams and Paul R. Torrens,
Introduction to Health Services (New York: Wiley, 1984), describes the types of
health care program within the system as a whole.

Although somewhat dated, a valuable source comparing the U.S. health care

system with the systems of other countries is Marshall W. Raffel, ed.. Compar-
ative Health Systems: Discriptive Analysis of Fourteen National Health Systems
(University Park: Pennsylvania State University Press, 1984). Another source
that compares health care systems is J. Rogers Hollingsworth, A Political
Economy of Medicine: Great Britain and the United States (Baltimore: Johns
Hopkins University Press, 1986). Chapter 2, "The Medical Delivery System of
the U. S., 1890-1970," provides a good historical overview with comparisons
made to England and Wales.



CHAPTER 2

Facilities That Deliver Health Care

JOAN D. KRIZACK



The delivery of health care, which may be defined as the provision of
diagnostic and therapeutic services to individuals and the promotion of
good health, is the primary function of the U.S. health care system. Like
the system itself, it involves a complex mix of institutions, organizations,
and individuals and a variety of public and private sponsors.

Institutions that deliver health care may be classified according to
whether they offer in-patient care, ambulatory (outpatient) care, or both.
(See Tables 2-1 and 2-2 for a typology of health care delivery settings.)
In-patient care is care given to a patient confined to an institution over-
night or longer. Most in-patient care is provided in a hospital; however,
free-standing birthing centers, hospices, nursing homes, prison and school
infirmaries, and substance abuse facilities may also offer in-patient care.
Ambulatory care is generally understood to refer to health care provided
to individuals not confined to a hospital.^ Because governmental regula-
tions limit reimbursement for Medicare and Medicaid patients and be-
cause other third-party payers are implementing cost-containing rules,
ambulatory care services are expanding to include procedures that for-
merly were performed only on an in-patient basis. Some institutions,
including most hospitals, provide ambulatory services in addition to in-
patient care. (See Table 2-2 for a typology of ambulatory care clinics.)

Hospitals, which have been described as "the center of both medical
practice and the experience of illness,"^ are the institutional focus of the
U.S. health care system. For this reason, and because the functions and
activities of a hospital parallel those that occur in other in-patient and



13



1 4 FACILITIES THAT DELIVER HEALTH CARE



TABLE 2-1 Typology of health care delivery settings

In-Patient Care Settings

Birthing centers

Hospices

Hospitals

Nursing homes

Secondary school, college, and university infirmaries

Substance abuse programs

Ambulatory Care Settings
Private physician offices

Solo practice

Group practice

General/family practice group
Single specialty
Multispecialty
Institutional settings

Business/industry

Health maintenance organizations

Holistic health centers

Hospitals

Prisons

Private homes

Schools
Freestanding clinics (see Table 2-2)



ambulatory settings, this chapter will concentrate on hospitals. A brief
discussion of other in-patient and ambulatory care settings, focusing on
their distinctive characteristics, follows the discussion of hospitals.



HOSPITALS

Of all the institutions that engage in the delivery of health care, hospitals
are the most central to the U.S. health care system. With the increasing
use of expensive medical technology in both diagnosis and treatment, the
hospital has become the central health care institution in the United
States. In 1990 the number of hospitals in the United States was 6,649' (as
compared to 3,535 institutions of higher education),'^ and $256 billion
was spent on hospital services (almost 39 percent of the $666.2 billion
spent on health care).'



HOSPITALS ' ' 15



TABLE 2-2 Typology of ambulatory clinics

According to Clientele Served

Clinics for Alaskan natives

Clinics for native Americans

Clinics for military personnel and their dependents

Clinics for poor people

Geriatric clinics

Migrant worker healtfi clinics

Maternal and infant clinics

Neighborhood/community clinics ("free" clinics)

Rural clinics

Teen clinics

Women's clinics

According to Condition(s) Diagnosed/Treated

AIDS and HIV clinics

Ambulatory surgery centers

Arthritis clinics

Birthing centers

Cancer detection centers

Dental clinics

Diabetes climes

Diagnostic imaging centers

Dialysis centers

Emergency (urgent) care clinics (emergicenters)

Family planning clinics

Heart disease clinics

Immunization clinics

Mental health clinics

Obstetrics and gynecology clinics

Pain relief clinics

Primary care clinics

Rehabilitation centers (cardiac, physical)

Sexually transmitted or venereal disease clinics

Sports injury clinics

Substance abuse clinics

Surgicenters

Tuberculosis screening clinics

Vision disorder clinics



16



FACILITIES THAT DELIVER HEALTH CARE




FIGURE 2-1 The Hunnewell Building of Children's Hospital, Boston, circa 1919.
Milk from the cows in the foreground was pasteurized in the hospital's Milk
Laboratory and given to patients to prevent them from contracting bovine tuber-
culosis. Source: Children's Hospital Archives



Hospitals were not always the focus of medical practice, education,
and research that they are today. In the eighteenth and nineteenth
centuries, poor people who were sick went to hospitals, while the iniddle
and upper classes received medical care at home. With the introduction of
antisepsis, however, hospitals became safer, and since the early twentieth
century they have become indispensable to providing medical care, edu-
cating health care professionals, and conducting bioinedical research.^'

Hospitals perform four of the six functions of the U.S. health care
system defined in Chapter 1. In addition to the patient care, education,
and biomedical research functions, inany hospitals have health promotion
programs, although it should be noted that historically, the U.S. health
care system has emphasized treatment over prevention. Regulation is not
a function of hospitals, which are themselves regulated by federal, state,
and local governmental agencies. Neither are they involved in health care
policy formulation. Hospitals do, however, influence health care policy



HOSPITALS 1 7



and regulation mainly through the lobbying activities of state hospital
associations and the American Hospital Association.

TYPES OF HOSPITAL

A hospital may be broadly defined as a health care treatment facility with
six or more in-patient beds7 Hospitals in the Unites States compose a
heterogeneous, decentralized, and fragmented grouping of institutions
about which it is extremely difficult to generalize. Nevertheless, it is
important to attempt to categorize them and describe their similarities and
differences, thus providing a broad context within which archivists can
construct documentation plans. As with most efforts at classification,
some hospitals cannot neatly be placed into one category (mobile hospi-
tals), and some fit equally well into more than one category (women's and
children's hospitals).

For the purpose of this study, hospitals are categorized in terms of five
characteristics: (1) ownership or control, (2) degree of independence, (3)
the type of patient treated or services provided, (4) whether or not the
hospital is involved in educating or training health care professionals, and
(5) whether or not the hospital is involved in biomedical research. (See
Tables 2-3 and 2-4.) The first three characteristics are the most important
from an archival standpoint because they have the greatest impact on the
types of record created and where the records are located. If a hospital
engages in educational activities and/or biomedical research, the types of
record created will obviously reflect these activities; conversely, if a
hospital does not engage in education and research, no records reflecting
these activities will exist. Because the patterns of hospital ownership and
control are relatively diverse and complex (see Table 2-4), as are the
various configurations in which a hospital is part of a larger organization,
they are described in detail below.

Ownership or Control: Government The federal government, most
state governments, and many local governments own and operate hospi-
tals. In 1991 the federal government ran 5 percent of the nation's hospi-
tals; state and local governments operated 26 percent.

In the federal government the organization most directly concerned with
health care is the Department of Health and Human Services (DHHS).
The division of the DHHS most directly concerned with the delivery of
health care is the Public Health Service, which in turn comprises
eight agencies. Within the Public Health Service, for example, the Sub-
stance Abuse and Mental Health Services Administration jointly adminis-
ters, with the District of Columbia, St. Elizabeths Hospital, in Washington,



1 8 FACILITIES THAT DELIVER HEALTH CARE



TABLE 2-3 Typology of hospitals

Ownership/Control (see Table 2^)

Degree of Independence
Freestanding
Larger organization

Health care company

Health maintenance organization

Holding company

Multihospital system or chain

Part of a university, industry, business

Patients Treated or Services Provided
Type of patient treated

Black hospitals

Geriatric tiospitals and nursing homes

Hospitals for employees of specific businesses/industries

Hospitals serving native Americans/Alaskan natives

Military hospitals

Pediatric hospitals

Prison hospitals

School/university infirmaries

Veterans hospitals

Women's hospitals (women's and children's hospitals are sometimes
combined)
Type of service provided

Alcohol/drug abuse hospitals

Burn hospitals

Cancer hospitals

Chronic disease hospitals/hospices

Communicable diseases hospitals

Convalescent hospitals

Diabetes hospitals

Epilepsy hospitals

Eye, ear, nose, and throat hospitals

Eye hospitals

General medical and surgical hospitals

Homeopathic hospitals

Hospitals for mentally retarded people

Immunology and respiratory (including tuberculosis) hospitals

Leprosaria

Maternity hospitals

Orthopedic hospitals

Osteopathic hospitals

Physical rehabilitation hospitals

Psychiatric hospitals

Hospital Engages in Education
Hospital Engages in Research



HOSPITALS "' " 19



TABLE 2-4 Hospital ownership or control

Governmental Ownership
Federal
Department of Defense

Air Force

Army

Navy
Department of Health and Human Services, Public Health Service

Health Resources and Services Administration

Indian Health Service

National Institutes of Health, Clinical Center
Department of Justice, Bureau of Prisons
Department of Transportation, U.S. Coast Guard
Department of Veterans Affairs
State

State health agencies (long-term facilities for chronically ill, people with

developmental disabilities, and people with mental or emotional

difficulties)
State prison/reformatory hospitals
State university medical school hospitals
Local

City/county joint hospitals
City hospitals
County hospitals
District hospitals



Private Ownership
Voluntary (nonprofit)

Business/industry

Church or religious order

Community group

Fraternal organization

Health care cooperative/coUeaive

Health maintenance organization

Private university
Proprietary (for profit)

Corporation

Individual owner

Partnership



20 FACILITIES THAT DELIVER HEALTH CARE



D.C., which is a psychiatric hospital for residents of the District of Columbia
and the Virgin Islands; the Health Resources and Services Administration
provides health care services to Hansen's disease (leprosy) patients and
others at the Gillis W. Long Hansen's Disease Center, in Carville, Louisiana;
the Indian Health Service runs 50 hospitals and more than 300 clinics for
native Americans and Alaskan natives^; and the National Institutes of
Health's Warren Grant Magnuson Clinical Center consists of a 540-bed
hospital and laboratory complex.^

Other departments of the federal government are also involved in the
delivery of health care. The Department of Defense, for example, controls
army, navy, and air force hospitals, both in this country and abroad,
providing health care services to military personnel and their dependents.
Through the Department of Veterans Affairs, the federal government also
operates approximately 170 veterans hospitals, the majority of which are
general hospitals but some of which are psychiatric hospitals. The Depart-
ment of Justice, Bureau of Prisons, Health Services Division, provides
health care services for prisoners in federal institutions and runs the
Medical Center for Federal Prisoners, a large referral hospital. The Depart-
ment of Transportation runs U.S. Coast Guard hospitals in Kodiak, Alaska,
and New London, Connecticut.

State governments operate long-term facilities providing care for people
with mental or emotional difficulties and people with developmental
disabilities; in 1 99 1 250 state mental hospitals were in operation, though
the patient population was reduced only a fraction of what it had been a
generation earlier. State prison, state reformatory, and state university
medical school hospitals (for example, the University Hospital at the
University of Michigan Medical School) arc controlled to some extent by
state governments. Historically, states also ran hospitals for tuberculosis
patients (Glenridge Hospital, Glenville, New York, for example, which
closed in 1978).

Local governments, embodied in districts, counties, and cities, may also
run hospitals. In 1991 local governments controlled 1,393 hospitals
(1,352 general, 15 psychiatric, and 26 other), or 21 percent of all U.S.
hospitals. District hospitals, found in a few states, including California, are
governed by boards of directors who are elected by district residents;
county hospitals are generally run by county boards of supervisors (for
example. Cook County Hospital, Chicago); and city hospitals are owned
by municipal governments and managed by appointed boards of citizens
(Boston City Hospital). Sometimes city and county governments jointly
control a hospital.

Most public hospitals were founded to provide health care to indigent
people who were not served by voluntary hospitals. Today, public hospi-



HOSPITALS '' 21



tals include teaching hospitals, a small number of large general hospitals
treating primarily indigent people, some hospitals in urban areas in which
the patient profile is similar to that in voluntary hospitals, and many small,
rural hospitals.'^

Ownership or Control: Private The sizable number of voluntary
hospitals was born of the country's ethnic and religious diversity. ^^ Histor-
ically, voluntary or nonprofit hospitals were established by community
leaders or by religious or ethnic groups to serve the "deserving poor"
and individuals who became ill while away from home. Voluntary hos-
pitals provided free care and were paternalistic toward their patients.
As a rule, however, they did not treat indigent, contagious, morally
lacking, mentally ill, or chronically ill patients; this task was left to public
hospitals. '2

Voluntary hospitals, which accounted for 51 percent of U.S. hospitals
in 1991, are owned and/or operated by seven types of organization: (1)
churches or religious groups (including Baptist, Lutheran, and Roman
Catholic churches, the Salvation Army, the Sisters of Mercy, and the
Alexian Brothers); (2) private universities (e.g., Boston University's Uni-
versity Hospital); (3) fraternal organizations (the Shriners); (4) industry
(railroad and lumber companies); (5) community groups composed of
citizens who organize to provide health care for their community and
make annual contributions (Beth Israel Hospital, Boston)^'; (6) health
maintenance organizations (Kaiser Foundation Health Plan, Inc.); and (7)
cooperatives, which are owned by those who use their services (Group
Health Cooperative of Puget Sound). '"^

Proprietary or for-profit hospitals are usually set up as partnerships or
corporations. They emerged where community groups could not raise the
funds necessary to establish voluntary hospitals. In the late nineteenth
century and well into the twentieth century physicians often owned
hospitals because it was convenient to have a hospital close to their offices.
Furthermore, by starting their own hospital, physicians who did not have
admitting privileges in existing hospitals could treat patients needing
hospitalization instead of referring them to a colleague. Such physician-
owned hospitals, once common, are now rare.

During the Depression, many proprietary hospitals were closed or
merged with voluntary or public hospitals. After the passage of Medicare
and Medicaid legislation in 1965, however, the number of proprietary
hospitals rose again, because they were now reimbursed for interest on
their debt, plant depreciation, and capital equipment. ^^ After for-profit
hospitals were reimbursed by the government for Medicare and Medicaid
patients, they became more like voluntary hospitals. At the same time.



22 FACILITIES THAT DELIVER HEALTH CARE



voluntary hospitals became more like for-profit hospitals because the
government reimbursed them for some of their charity work.

Before 1965, the American public held a strong prejudice against the
for-profit hospital sector because the practice of medicine was viewed as
charity or a service to humanity. This prejudice lessened to some extent
once voluntary and proprietary hospitals became more like each other. ^^
Proprietary hospitals, however, continue to lag behind the hospital indus-
try as a whole in conducting research and providing outpatient services,
emergency services, health promotion services, and education for medical
professionals.^''

For the past several years, the number of proprietary hospitals has
remained stable. ^^ In 1991, 17.5 percent of hospitals were proprietary,
representing a decrease of 0.4 percent since 1950; however, the number
of beds and admissions in proprietary hospitals both increased signifi-
cantly during this period.

Degree of Independence Whether a hospital is freestanding or part of
a larger organization is important to understanding where documentation
is located. Obviously, if the hospital is freestanding there are fewer
possibilities than if it is part of a larger organization. There are several
configurations for a hospital within a larger organization. A hospital may
be one of the institutions composing a holding company. The Massachusetts
Eye and Ear Infirmary, for example, is part of the Foundation of the
Massachusetts Eye and Ear Infirmary, which is an umbrella organization
made up of the nonprofit infirmary and the Circle Company, a for-profit
real estate company that owns a hotel and a parking garage with several
storefronts. A few health maintenance organizations (HMOs) own one or
more hospitals. An example is Kaiser Permanente, which owns more than
twenty-five.^^ Hospitals are also owned by health care corporations, such as
National Medical Enterprises, Inc., which in 1992 owned thirty-six gen-
eral hospitals, thirty-two rehabilitation hospitals, seventy-five psychiatric
hospitals and substance abuse facilities, eighty-five nursing homes, and
thirty-five diagnostic centers in the United States, in addition to hospitals
in Australia, Great Britain, Spain, and Singapore. вАҐ^^

Multihospital systems are three or more voluntary hospitals (e.g., Ad-
ventist Health System) or governmental hospitals (e.g.. Veterans Admin-
istration hospitals) that collaborate through ownership, management, or
lease arrangements to enhance patient care. Their for-profit counterparts
are hospital chains such as Columbia Healthcare Corporation, which was
founded in 1985 by Richard L. Scott and merged in 1993 with Galem
Health Care and HCA-Hospital Corporation of America, creating a net-
work of one hundred ninety hospitals in twenty-six states and two foreign



HOSPITALS 23



countries. 2^ In 1986 one third of all U.S. hospitals were divisions of
multihospital systems. ^^

Finally, hospitals may be part of a university (there are 45 public
university hospitals in the United States), industry, or business. The Univer-
sity Hospital in Boston, for example, is owned by Boston University; and
at the turn of the century many of the larger railroad, mining, and
lumbering companies built, owned, and operated hospitals for their em-
ployees.^' With the dramatic rise in the cost of operating health care
facilities and the increased availability of group health insurance, com-
pany-owned hospitals are no longer common; however, in an attempt to
hold down rising health care costs, several large corporations are estab-
lishing in-house clinics and pharmacies for their employees.^"*

REGIONAL PATTERNS

Certain patterns of hospital ownership and control are more prevalent in
some areas of the country than in others. Proprietary hospitals were
begun in areas where the population was too poor or too scattered to
support a voluntary hospital. The majority of proprietary hospitals, there-



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