HOSPITAL DISTRICTS IN TEXAS

by

MINARD HESTON GILDON, B.A,

A THESIS

IN

GOVERNMENT

Submitted to the Graduate Faculty of Texas Technological CoIIege in Partial Fulfillment of the Requirements for

the Degree of

MASTER OF ARTS

Approved

May, 1966 a

fOsr . ;

No. So <Z.Op, 2J ACKNOrt'LEDGMENTS

1 would like to express my appreciation to Dr. Shirley

Chapman for her direction of this thesis and to the other

members of my committee, ProfessorsJ, WiIIiam Davis,

J. W. Jackson, and Timothy Donovan, for their helpful

criticism.

1.1

CONTENTS

Page

ACKNOWLEDGMENTS ii

LIST OF TABLES iv

CHAPTER

I. INTRODUCTION I

II. INDIGENT PATIENT CARE IN TEXAS 12

The City-County Approach 13

Community Participation. . . . 18

State's Responsibility 26

III. LEGAL BASIS OF HOSPITAI. DISTRICTS 36

IV. CASE STUDY: AMARILLO HOSPITAL DISTRICT . . . 48

Important Pro-district Organizations . . 49

The Election 59

V. CONCLUSIONS AND RECOMMENDATIONS 64

Conclusions 64

Reconimendations 69

BIBLIOGRAPHY 72

IIL

i V

LIST OF TABLES

Table Pa;2:e o'

1. AMARILLO HOSPITAL DISTRICT ELECTION RESULTS . . 61

CHAPTER I

INTPODUCTION

Special districts and authorities are the fastest

growing unit of government in the United States today.

There are special districts in every state of the union.

With this growth of local governmental activity is an

increasing tendency to shun use of existing basic units of

government, such as the county and municipality, in favor

of the special district approach, especially regarding new

functions or those rapidly increasing in demand. This

growth, however, is coming virtually unnoticed. The only

special district that is reasonably well known by the

general public, is the school district. Special districts

move in an area between public and private business. The

leaders of a special government agency escape the normal

checks that function on most governmental units, as gen-

erally no opposition group organizes to challenge those

in power.

U. S. Bureau of the Census, Census of Governments; 1962, I, Govemmental Organizations, 1963, 15.

Special districts are separate and distinct units of

local government. Generally speaking, a special district

has its own goveming body, is separated from other local

govemments, and possesses independent means of raising 2

money to finance its operations. In order to be counted

a govemment by the U. S. Bureau of the Census, a special

district must possess: (l) organized existence, (2) govem*

mental character, and (3) substantial autonomy.

The greatest rate of expansion of special districts

are those on the municipal and county level in the United

States. In 1963, by special act, the Texas Legislature

authorized the creation of 36 new districts of which 15 3

were for hospitals. These districts are not forced on the

local govemment by state or federal action, but are the

initiative of the local governments themselves under ena-

bling legislation of the state govemment. The essential

ingredient for creation of a special district is that the

people of a community want a service, The desire for a

particular service may be stimulated by an interest group,

but, generally speaking, no district is created without

the people first expressing a desire for a service that

the district will perform.

^lbid.

3 Institute of Public Affairs, The 58th Texas Le isla-

ture, A Review of Its Work (University of Texas, 1963) App.A, 51^4.

Hospital care for the indigent citizens of Texas com-

munities is a good example of a service needed by many

areas of the state. Providing medical facilities for

those who cannot pay will become a greater problem for ur-

banized Texas if communities fail to meet their responsi-

bilities. The hospital district is a govemmental entity

whose major purpose is to provide or to finance medical

needs for its indigents. When a hospital district is

created, no other unit of govemment may assess and collect

taxes for this purpose. Therefore hospital districts pro-

vide local residents with a responsible govemmental unit

vdiose single purpose is to provide hospital care for those

in need \^ether the patient can afford it or not, and

spreads the taxes as evenly as possible among the local

citizens.

As early as I9l4, studies pointed to the rapid use of

"special municipal corporations" which had become necessary

through the inadequacy of standard local govemments to

meet the obligations imposed by an increasingly complex

community life. There is néed of the special district in

4 Vemon's Annotated and Revised Civil Statutes of the

State ôf Texas. Art. 4494N, Sec. 13 (hereinafter referred to as V.A.C.S,).

«;

,, "Let»s Look Again at Special Districts," Public Management. XLVII (January, 1965), 3.

govemment. The role, however, of the special district is

not best served by divorcing it entirely from the over-all

concerns of the community, particularly at a time when the

very complexity of life places an increasingly greater

premium on the complementary role of govemment.

The special govemment district, existing for a wide

range of purposes, such as water, soil conservation, weed

control, has become an accepted and increasingly popular

method of adapting govemmental organization to satisfy

demands for governmental services. Many individuals and

groups have denounced this method, but the special district

seemingly has become permanently established as a part of

our govemmental way of life.

One reason why special districts are important in Texas

is because there are so many of them. About 70 per cent of

all the governments in Texas are special govemmental

units. The majority of these are school districts. How-

ever, a significant point is that in the last few years,

the number of school districts has been declining while all

other types of special govemments are increasing.

Special districts are difficult to describe. It is

hard to say with any general statement what type of

structure they have, or how they are financed. Methods of

Woodworth G. Thrombley, Special Districts and Author-ities in Texas (Austin: Institute of Public Affairs, University of Texas, 1959), 3.

administration, size, and legal powers are very diverse.

From the functional standpoint, the services rendered in-

clude water supply, soil conservation, airports, irrigation,

libraries, and hospitals. Many of the organizations have

highly paid professional staffs. Others are unpaid

amateurs. Dr. Bollens, describing special districts, uses

the following definition:

They are organized entities, possessing a struc-tural form, and official name, perpetual succes-sion, and the rights to sue and to be sued, to make contracts, and to obtain and dispose of property. They have officers who are popularly elected or are chosen by other public officials. They have a high degree of public accountability. Moreover, they have considerable fiscal and ad-ministrative independence from other governments. The financial and administrative criteria dis-tinguish special districts and other govemments from all dependent or subordinate districts and from most authorities v^ich, lacking one or both of these standards, are not governmental units, However, some entities legally identified as authorities, especially those in public housing, meet the requirements and are considered as special district govemments. Unlike most other govemments, individual special districts usually provide only one or a few functions.'

State government has traditionally closely supervised

the activities of counties and certain classes of cities, •

but has virtually ignored special districts. If central

control is justified with respect to city and county

John C. Bollens, Special District Government in the United States (Berkeley: University of Califomia Press), 1961, 1-2.

6

govemment, it is even more justified with respect to non-

school special districts. As a matter of fact, constitution-

al and statutory limitations on cities and counties may be

completely negated by the simple creation of nonschool

special districts. Such is particularly true with respect

to state imposed tax and debt restrictions. Many Texas

districts have no legal tax or debt limits whatever.

In order to discuss special districts in Texas intel-

ligently, some sort of classification should be made.

However, in Texas this is virtually impossible. There are

some 30 different species.of special districts created by

Texas law. With the exception of school districts, soil

conservation districts, housing authorities, and hospital

districts, nearly all other districts in the state are

water-related districts. That is, their principal function

has to do with water supply, conservation, control, power,

irrigation, recreation, navigation, and related activities.

The endless maze of legislation goveming the estab-

lishment and operations of special districts in Texas is

the product of decades of unsystematic patching and change.

Most of the districts were formed under the sweeping

authority of Article XVI, Section 59 of the constitution.

This section of the Texas Constitution provides for the

conser^ation and development of all the natural resources

of the state, However, very little is revealed in the

statutes with respect to the activities of individual

districts. Special districts, excluding school districts,

are widely dispersed over Texas. They exist in all 254 o

counties, except Crane and Kenedy Counties. AIso, there

is no correlation evident between the location of districts

and concentrations of population.

The large number of special districts of all kinds and

the long adherence to restrictions on local taxing and bor-

rowing authority indicate that substantial support and rea-

sons have not been lacking for this facet of local govern-

ment. District formation always results from the inter-

play of different factors, many of which may be unique to

a particular situation or locale. In a general way, how-

ever, it is possible to identify several of the more im-

portant reasons for the creation of district governments.

The greatest reason for special districts and author-

ities has been the inability of established governments to

perform needed services. In the rural areas, a lack of

proper administrative machinery has compelled these people

to seek solutions in new governmental units. These new

governments have taken the fbrm of the easily created,

highly flexible rural special district.

Urban govemments generally possess administrative

competence, and the necessary legal help, but have a

8 Thrombley, loc. cit.

8

problem in politics and finances. The chronic lack of

funds forces many cities to give up their service respon-

sibilities in favor of the special district. The district

device is also a convenient and politically painless method

of circumventing tax and debt limitations, or shifting

responsibility for a burdensome task. The public hospital

function is a good example. Hospital districts with

separate and independent taxing powers may be locally

created in the state. The general units relinquishing the

function are thereby free to increase their expenditures

to the extent that they had supported the hospital system.

The net result is an increase in the aggregate local tax

rate, and a new local govemment.

A not insignificant number of well intentioned people

will promote the formation of a special district in an

effort to get a governmental function "out of politics".

Also, the rapid growth of special districts is due to the

desire for financial gain on the part of interested groups

and individuals. 'lhe semi-secret atmosphere which beclouds

their establishment and operations lends itself to all

manner of promotional practices in the sale of equipment,

services, and real estate.

Another important advantage of the district approach,

from the office holders' viewpoint at least, is that the

creation of a district does not disturb the existing struc-

ture of govemment, but only adds another unit. Thus,

existing political loyalties are not strained or destroyed,

nor are jobs abolished or transferred. In short, it is

possible to provide a new service or expand an old one and

maintain the political status quo at the same time. Com-

munity leaders therefore can justify the formation of

special districts to provide essential services which reg-

ular govemments are unable to supply. Beyond the legal,

financial, administrative, and political inadequacies of

regular local government, the special district approach

has great merit vriiere problems cross political lines or

transcend the boundaries of regular govemments. It is this

flexibility of area which allows the special district to be

tailored to fit current needs which is its chief selling

point.

The most enduring criticism leveled against special

districts is that they are undemocratic. In other words,

their activities are obscured from the public eye by in-

frequent and little publicized meetings, little or no

public reporting, disguised tax and service charges, the

smallness of their operationb, and their numbers. Many

claim the end result is that the public is effectively

precluded from influencing district operations. Whereas

the district may be efficient, competent, public-spirited 9

government, it is not self-govemment. Public

^lbid.. 118.

10

responsibility is limited because of the lack of referen-

dums. However, this argument is not too strong because

most special districts perform services of a highly tech-

nical nature. If the general public is uninformed about

and unconcemed with their operations, it is perhaps be-

cause the nature of those operations is such as to not

command public attention,

Another viewpoint which cites weakness of special

districts is that they confuse and complicate the local

govemment picture, and are generally small in operation

and single in purpose and therefore uneconomical. This

expresses the belief that the sudden abolition of districts

would somehow reduce the complicated and expensive volume

of local governmental services. It is difficult to say

with any degree of accuracy, just what is the exact right

number of governments for an area. However, if adminis-

trative machinery is grossly decentralized, most adminis-

trators will agree that the chances ofdealing satisfactorily

with any complicated situation or problem increases when

you have before you all the significant elements and de-

creases when any of these elements are missing. Metro-

politan areas are plagued with the problem of multiple

10 Luther Gulick, "Design for the Future," National

Municipal Review. XLVI (January, 1957), 10.

11

jurisdictions which hamper the overall effectiveness of

local govemment.

A type of special district of rapidly increasing

significance is the hospital district. As govemmental

concem for and participation in health and medical care,

as well as welfare, increased at all levels, existing com-

ponents of govemment and revenue structures were subjected

to intensifying political, legal and administrative pres-

sures. These pressures result in forces pushing for more

and better publicly supported hospital care. Often, these

groups channel their energies into securing the creation

of a new unit of local govemment to meet existing and

future needs. Thus, the rapid growth of hospital districts.

Governmental units, church bodies, philanthropists,

industries, and individuals have participated in the con-

struction of hospital facilities. This type of development

has resulted in uncoordinated patterns of organization,

administration, and control of hospitals. For the most

part, this study is restricted to the role of the hospital

district as a governmental unit in Texas, and its relation-

ship with the community in trying to cope with the problem

of indigent patient care. A case study of the Amarillo

Hospital District is used to show the process of formation

and how the political and financial problems of indigent

patient care can be solved.

CHAPTER II

INDIGENT PATIENT CARE IN TEXAS

The principle of public responsibility for hospital

care of the indigent has been generally accepted, but in

many instances public funds have not been sufficient to

meet the cost of such service. Some of the problems of

financing hospital care have been solved but much remains

to be done.

The earliest hospitals established in the United

States were overcrowded and unsanitary. They were founded

for the poor as a charity program by wealthier citizens

and welfare organizations. Their reputations were low in

the minds of most citizens. The present day hospital is

an institution available to everyone in need and provides

the benefits of modem medical knowledge. Today, as in

the early daj's of hospitals, provision must still be made

for the patient v^o needs medical assistance but is unable

to pay for it.

, Hospital Care in the United States, Commission on Hospital Care (New York: The Commonwealth Fund, 1947), 423.

12

13

The American Hospital Association in 1960, provided

this definition:

The medically indigent are persons econom-ically above the level of public assistance who, when confronted by extensive health costs, are unable to meet them in full. These people should be considered as 'medi-cally indigent* for the duration of the illness. If not given timely aid when faced with such costs these people may quickly be-come indigents and thus eligible for whatever health services are provided to the indigents and in some cases, also for cash assistance,^

In establishing medical indigency, considerations must be 3

given to:

(1) persons in older age brackets who are unemployed and their dependents.

(2) temporarily unemployed persons and their depen-dents.

(3) the disabled v*io cire financially indigent and their dependents.

(4) persons receiving public aid.

(5) persons with income insufficient to buy the daily necessities in life such as food, clothing, and housing.

The Citv-County Approach

In Texas, teaching hospitals supported by taxes began

developing in the large metropolitan area and were financed

by county and state taxes as a part of the general welfare

2 Ben Tobias, "Joint City-County Responsibilities,"

Texas Hospitals, XX (November, 1964), 18.

^lbid.

14

program for paupers. Since admission of charity patients

was the only legal purpose for county hospitals, these

patients had priority over the private patient. However,

the laws recognized that private patients could be admitted,

About 6 per cent of the hospitals in Texas are con-

trolled partially or completely by municipalities. These

institutions rely on tax money and revenue from paying

patients. Not all hospitals, however, have found this

sufficient to maintain high standards of patient care.

Difficulties concerning responsibility for financing health

care create municipal problems.

Until Houston created a hospital district supported

by tax money, the city and county authorities held joint

meetings to work out proper percentages for supporting the

city-county hospital. The city of Houston paid 65 per cent

of the hospital's operating costs and Harris County paid

35 per cent of the costs. The City of Corpus Christi has

worked out a compromise solution between the city council

and Nueces County x^ereby the city pays one-third of the

cost of charity care and the county pays two-thirds. The

city council in a resolution accepting the county proposal

stated that the city believes the cost of operation of

4 American Hospital Association, Hospitals. XXXVIII,

(August 1, 1964).

Tobias, loc. cit.

15

Memorial Hospital is properly a county responsibility but

that the county has insisted it is unable to completely

finance the hospital's operations. In 1963, the City of

Wichita Falls announced that they would cease to pay for

one-half of the bill for indigent patient care. A study

committee was appointed and new policy for the citv to pay

one-third of the hospital's annual deficit was adopted.

Texas cities are not the only ones to experience

financial difficulties for the care of the medically indi-

gent. In 1964, New York City voluntary hospitals received

disbursements totaling $67 million from the city budget.

Almost 80 per cent of the patients in New York municipal

hospitals are people who manage to cover their ordinary

expenses but j^tio lack the margin in income, savings or

health insurance to pay the hospital and the doctor when

they get sick, Medical indigency can occur at any income

level vdien a costly illness cuts off income, exhausts

insurance benefits, and wipes out savings. In Philadelphia,

the city council was hit by a campaign to obtain an addi-

tional $5.5 million for the city's hospital to pay for the 7

care given medical indigent patients.

6 Nora K. Piore, "Metropolitan Medical Economics,"

Scientific American. CCXII (January, 1965), 19-27.

, The Modem Hospital^ CV (December, 1965), 166.

16

In Texas the city legally has no responsibility for

financing the health care of the medically indigent.

Counties are charged by law with the responsibility for the o

indigent whether they are healthy or sick. When the

county fails to assume the welfare obligation, then it be-

comes a community moral problem. The city may be forced

to assume the moral responsibilities for rendering service

to the indigent sick.

The City of Austin, Texas, an example of city respon-

sibility, has worked out an ideal arrangement for financing

health care for the medical indigent with county author-

ities, with the exception that the responsibility is on the 9

city instead of the county. When the City of Austin and

Travis County joined together in 1883 to build a hospital,

each paid 50 per cent of the cost. Not until I915, when

the hospital became Citv HospitaI> were private patients

admitted. Since 1933, the hospital has continued to be

owned and operated by the City of Austin. The hospital is

a city department, with final authority and responsibility

resting on the city council.* In September, 1951, the City

of Austin and Travis County made an informal arrangement

whereby the city assumed responsibility for providing

health care to the medical indigent in the county. This

8 V. A. C. S.. Art. 4478. 9 Tobias, ©2.. cit., 22.

17

arrangement has continued on a satisfactory basis. Tax

revenue from the city's taxable property and monies from

the electrical utility company comprise the bulk of the

city's operating funds. The difference between the total

expenses at the city hospital last year and the actual

collections was made up from the city*s operating fund.

This amounted to $1,300,000 for the cost of indigent care

and education.

The fact that the hospital has admitted private patients

for nearly 50 years may help to explain x hy two-thirds of

the inpatient load consists of private patients. The pri-

vate patient is not paying for charity services as such,

but the fact that private patients do pay their bills makes

it possible for the hospital to offer services to all pa-

tients at less of a burden upon the city,

Some of the problems created with this type of health

care financing of the medically indigent are:

(1) Specialized physicians in large cities do attract referrals of patients, who are un-able to pay for the services rendered, from the surrounding rural or small town areas.

(2) The surrounding counties do not meet their responsibilities for financing the health care of their indigents.

i°ibid.

^ Ibid.

18

(3) The problem of health care provided for outpatients whose income is too high for clinic aid, but are unable to afford pri-vate physician fees.

(4) The collection of borderline accounts.

Communitv Participation

The acuteness of the medically indigent problem in

Texas Hospitals is well outlined in the Central Texas

Hospital Area Council Resolution presented to Governor

Connally in 1963.^^

Whereas, hospital care for indigent and medically indigent citizens has been and is now being provided by hospitals throughout the State of Texas, and

Whereas. these essential services are being rendered to those who are not able to reimburse the hospitals for the cost of said services, namely, the indigent and medically indigent, without, in most areas of Texas, adequate fincincial support from county and city govemments, and

Whereas, this lack of financial assistance from the local governments has placed serious financial burden on hospitals providing indigent medical care, the providing of said care tradi-tionally being the responsibility of local govern-ments as authorized under the laws of the State of Texas, and

Whereas, the Central Hospital Area, composed of hospitals in the I7 county Central Texas area, has conducted a series of meetings devoted to a study of this particular problem, and

Whereas^, it is the opinion of the Central Texas Hospital Area that indigent medical care has been for many years and is now being provided by most of the hospitals of Texas without adequate financial assistance from the local govemments, and in many counties of Texas, with no financial

^^ , Texas Hospitals. XIX (July, 1963), 4.

19

assistance whatsoever, creating a serious financial problem for many hospitals through-out the state of Texas,

Now, therefore, be JJC resolved, that the Central Texas Hospital Area respectfully re-quests that the Board of Trustees of the Texas Hospital Association present this matter to the House of Delegates of the Texas Hospital Asso-ciation at the May convention of said Association with a recommendation that said House of Delegates consider and vote upon a resolution to be pre-sented to the Honorable John B, Connally, Governor of Texas, by the Texas Hospital Association, urg-ing Govemor Connally appoint a state-wide Commis-sion on Indigent Medical Care to make a study of the problem on a state-wide basis and recommend solutions designed to alleviate this very serious problem of the hospitals and citizens of the State of Texas.

Adopted April 17, 1963 by the Central Texas Hospital Area.

Unanimously approved by the House of Delegates of the Texas Hospital Association this the twenty-second day of May, 1963 at Dallas, Texas.

Medical indigency is a fact of life for most Texas

hospitals. The important question is what is the fair way

to go about financing this care. Generally, there are two

methods for providing funds for indigent patient care,

The cost can be subsidized by outside groups or individuals,

or the most common method is to have the cost included in

the current operating expense budget. The responsibility •

of making the necessary financial arrangements, in most

13 cases, falls on hospital authorities.

In preparing a hospital budget, it should be planned

without including a built-in cushion or special funds for

13 John Gill, "Community Financial Participation",

Texas Hospitals. XX (November, 1964), 19.

20

those who cannot pay, The budget should be realistic and

reflect the true patient care cost, The budget should pro-

vide funds for the care of those persons who cannot pay

the total costs of their treatment, and this revenue should

be raised from sources outside the hospital, It is not

enough to have an item in the budget to provide a certain

amount of money to be expended for the medical care of the

indigent patients, but every reasonable effort should be

made to collect the necessary funds from the patient or his

family, from civic clubs, philanthropists, volunteer ser-

vices, as well as from governmental agencies. If all other

efforts fail, then the hospital should absorb the cost.

If the hospital assumes the burden of providing free care

for the needy, and absorbs this cost into its operating

budget, then paying patients are paying more than the true

cost of their medical care. This practice is completely

unfair.

As long as hospitals are charitable institutions, it

is doubtful that any person will be refused treatment if

he is genuinely in need. Therefore, if other revenue

sources for medical indigency are unavailable, the hospital

has no choice but to provide the necessary services. How-

ever, it should be remembered that providing free services

to non-paying patients takes a large amount of hospital

income that should be used for improvement in education,

research, replacement of equipment, and expansion of

21

facilities. In order to provide a high level of patient

care, this type of progress is necessary. If tax money, or

money from other sources, does not reimburse hospitals for

the cost of indigent care, the quality of service is lowered,

In many Texas counties, hospitals are not only pro-

viding and financing service for the indigent patients,

but are also paying taxes to the governmental agencies. An

excellent example is the state constitutional amendment pro-

posal in the November 1965 general elections for hospital

tax exemption for those hospitals providing over a million

dollars annually in charity work. The amendment was de-

feated at the polls and actually was an attempt by Houston* s

14 Hermann Hospital to gain special consideration.

As hospitals gain experience with the problems of pro-

viding medical care for the indigent, it is evident that

more assistance is needed from the resources of the com-

munity. Health services need improvement in all our urban

areas. The average quality of care provided over the

country is not as good as it could be. People of the com-

munity used to think in terms of three basics, food, housing

and clothing. Now, the fourth basic need for medical care

for all our citizens must be added to the list.

Lubbock Avalanche-Journal^ November 3, 1965.

22

As Texas and other states become increasingly more

urbanized, govemmental agencies will be forced to have

greater concem for citizen health needs than is now

assumed. Some hospital employees fear increased govern-

ment participation because of the control which will be

imposed. Tax supported medical care programs for the needy

are essential and are necessary to protect and improve

their health. While they serve directly only a small part

of our population, indirectly they benefit the entire com-

munity. Medical care is one of the basic requirements of

a needy family. It has long been recognized that needy

families suffer a disproportionately large share of ill

health.^^

Many observers in the hospital field agree, that many

areas of medical care provided to the indigent are frag-

mentary and uncoordinated. Public Kealth Officials are

hopeful that the single program as required by the Medicare

Act will have the effect of reducing fragmentation of

medical services to the indigent.

In some cases the qualiTy of care is often indifferent

and even shockingly bad. Jan De Hartog's book about

Houston's City-County Hospital reveals the horrible

. American Journal of Public Health, XLIX (November, 1959), 1544.

^^ , The Modem Hospital, CV(November,196 5),28.

23

conditions which exist in their charitv institution.

In 1963, The American Medical Association published

their basic philosophy on medical care and how it should 18

be financed if the individual is unable to pay.

Responsibility for obtaining personal health care rests with the individual. When he is unable to pay for this care himself, responsibility for obtaining it should prop-erly pass to his family, the community, the county, and the state, and only when all these fail, to the federal government, but only in conjunction with the other levels of government.

The determination of medical need should be made by a physician; and determination of eligi-bility for receiving it at public expense should be made at the local level with local adminis-tration and control.. It should also be a local option to use tax funds to purchase health in-surance for a recipient of assistance instead of making a direct purchase of his health care.

Since in many cases, Texas local governmental units

have not accepted the full financial responsibility of in-

digent patient care, many communities are turning to one

of the solutions available to them, the creation of a

special district.

A hospital district is a single purpose special dis-

trict comparable to the school district. The purpose of a

hospital district in Texas is to provide or to finance the

hospital and medical care of its indigents and needy

I7 Jan de Hartog, The Hospital (New York:Atheneum Pub-

lishing Company, 1964), 18

, "Medical Care for the Needy," Journal of the American Medical Association, CLXXXIII(March 9, 1963), wr.

24

residents, Like other governmental units, it has the power

of taxation. A property tax is levied on the district's

residents to finance its purpose, The county no longer

has to attain enabling legislation, for the hospital dis-

trict is required to provide for these needs. No longer do

city or county agencies have to allot funds for the medi-

cally indigent. The cost of providing services to the

needy is clear cut and every citizen knows the exact cost

of the hospital district,

The mushrooming pressures of public hospital support

in the state's four largest metropolitan areas undoubtedly

led to the establishment of hospital districts in Texas.

AII four, Houston (Harris County), Dallas (Dallas Gounty),

San Antonio (Bexar County), and Fort Worth (Tarrant County),

were experiencing very difficult problems vdth respect to

indigent hospital support.

Two legislative acts may be required to create a

20 hospital district, First, an amendment to the Texas

Constitution, was approved by the voters of the entire •

state. Unless a county qualifies by name or population

limit under presently existing amendments, it must secure

passage of an amendment tailored to its needs. Second,

19 F. S. Walters, Jr., "The Historical Approach and the

Hospital District," Texas Hospitals. XX (October, 1964), 23. ZO ^^V. A. C. S.. Art. 4494m, Sec. I.

25

the state legislature must pass enabling legislation which

is the law goveming the operation of the specific district,

This law includes the procedure for creatin^ the district,

governing, and controlling the district, FoIIowing passage

of these bills, the citizens of the districts must vote

approval or disapproval, The board of managers serve with-

out pay and may be elected or appointed by the commissioner's

court,

The commissioner*s court of any county which has voted

to create a hospital district serves as the district's

agent with respect to district taxation and the issuance of

bonds, The district tax, not to exceed 75 cents per $100

valuation, is determined by the administrator of the dis-

trict, vd.th the approval of the district Board of Hospital

Managers, who are charged with preparation of the district's 21

budget,

Mbst of the objections raised by taxpayers, patients,

and local elected officials against county hospital and

charity patient financing are overcome by hospital districts,

v^ich are well managed. Natlirally, there is always the

criticism against hospital districts that all tax supported

agencies inherit.

21 Ibid.

26

State's ResDonsibiIitv

Until now, our concem has been the local responsibil-

ity in providing health care for the indigent. It will

become evident as the state's role for the responsibility

of the medically indigent is discussed, that private

hospitals are shouldering a large part of the cost of what

is a public responsibility,

The Kerr-MiIIs Act is the most complete program in 22

Texas. Under the act provision is made for hospital,

medical, surgical, radiation, and nursing home benefits to

those on Old Age Assistance, The Texas State Department of

Public Welfare pioneered a new approach in the implementa-

tion of this program, which has been extremely successful.

This plan is now serving as a pattern for many other states,

A Blue-Cross insurance policy was purchased after a careful

study of several bids from interested companies. This

method was chosen over the alternate method of providing

direct state payments under the program. The results have

proved very successful. *

The second phase of the Kerr-Mills Act is to provide

health services for the elderly not on Old Age Assistance

and who are unable to pay - or necessary medical services.

22 Don Cavness, "The State's Responsibility for Indigent

Care»" Texas Hospitals. XX (October, 1964), 19.

27

Although this program does not pay for the entire cost of

care for these people, it pays for a lar-e portion of the

costs which prior to this program were not paid at all.

The Texas 65* Health Insurance pron;ram has state

authorization, but is not state operated."^^ It consists

of an association of 64 private insurance companies offering

hospitalization coverage to the elderly. The 3Iue Gross

equivalent plan is the "Senior Texan Service". This positive

effort by Texans gives our state advantage over most other

states providing health insurance policies for the a'>ed.

Seventy-two per cent of the elderly in Texas are covered

by hospitalization insurance, as compared to the national

^ . 24

coverage of sixty per cent.

Texas 65' Health Insurance provides both basic and

major medical plans to Texas residents sixty-five years of

age and over XTÍthout a physical examination and without

answering lengthy medical questionnaires. In fact, eligible

persons can be enrolled by relatives or other interested

people. Even applicants XTÍth pre-existing illnesses can

enroll and after a reasonable waiting period, be covered

for a recurrence of those illnesses.

The Texas Board of Hospitals and Special Schools

operates three distinct programs which provide hospital

23 Ibid.

" " lbid.

28

care. Tuberculosis patients who are medically indigent

receive care at one of the four state tuberculosis hospitals.

The Hospital Board is authorized by the Texas Legisla-

ture to contract with private hospitals for the care of the

mentally ill. El Paso, Beaumont, and Corpus Christi have

contracts to provide this service. Approval has been given

for a contract in Lubbock, but as yet is not in force. The

Community Mental Health Program is active in giving financial

support for psychiatric care. The Mental Health Planning

Program in the State Health Department is working toward

increased use of public and private hospitals with the hope

of reducing by a significant amount the number of patients

in the state hospitals.

The University of Texas M, D. Anderson Hospital and

Tumor Institute in Houston and John Sealy Hospital, Galveston,

provide hospital care for a number of medically indigent

patients. The third program operated by the State Depart-

ment is hospital and medical care for crippled children.

If designated medically indigent by the local govemment

authorities vi ere they res:* de and under 21 years of age,

they are eligible for care under this program. The State

Board of Health sets the per diem rate upon recommendation

from the Crippled Children's Technical Advisory Committee.

This committee negotiates the per diem rate with hospitals

and must approve all doctors and hospitals used in the

program.

29

Texas laws require county authorities to eneage in

some welfare activities. They do not necessarily have to

pay for the medically indigent, The state law is onlv . . 25

permissive, The law does not speak of indigents, it onlv

speaks of paupers, Furthermore, since Texas is more urban

than rural, many of the responsibilities of county ,í>overn-

ments are now being assumed by city governments. With Texas

laws so far behind the times, it is not surprising that many

counties have not accepted their full responsibility to

finance the medical care of those wlio cannot pay. AIso,

it should be pointed out that Texas is not the only state

with this problem.

In the state of Maryland, of those certified as indi-

gent by the State Department of Public Welfare, half the

hospital's actual cost for patient care is paid. A good

example of the burden placed on Maryland hospitals by the

state arbitrary reimbursement formula is Baltimore's Johns

Hopkins Hospital. In the fiscal year 1958, Johns Hopkins 26

treated 29,251 in-patients, It collected more than 8

million dollars from paying patients. Yet Johns Hopkins

ran up the largest operating deficit in its history. Gifts,

25 Walters, oj5, cit, . 22.

26 Albert Q, Maisel, "Why Hospitals are Chronically

Broke," The Kiwanis Magazine, (October, 1959), 45-47.

30

bequests and endowment incomes were apolied to rheir expense

budget, instead of their capital improvements, in order to

meet a $565,000 deficit. The reason for this hwy.e deficit

was because the hospital had provided almost 62,000 days of

27 first class care to 4,644 patients who could not pay. In

Michigan, hospital losses under the state-aid pro^ram have

been running as high as $17,75 per patient per day. In

Mississippi, the state has been paying $6 a day for charity 28

patients, víhile costs average $22,23,

Several years ago, Connecticut hospitals were as badly

off as those in other states, They received only $5 a day

for treating welfare cases, As a result, employee wages

were low, staffs were undermanned, and equipment was run-

down, At this point all 34 of Connecticut's nonprofit

hospitals united to take their case to the people. A high

gear public information program was begun to show how the

state financial participation covered only one third of the

cost of providing care for the needy. As a result, a bill

providing for full state payment for indigent hospital care

was passed by the legislature. Connecticut hospitals are

now free of the burden of state-imposed deficits. Other

27 Ibid.

28 bid.

31

states vjhich have followed Connecticut's lead are Minnesota,

Idaho, and New Mexico.

On March 30, 1965, Governor Campbell of New Mexico

signed into law the Indigent Hospital Claims Act, which

places directly on the individual counties of the state the

financial responsibility for care for hospital indigents

of each county." The legislation provides for the creation

in the treasury of each county of an indigent hospital claims

fund, Levies against property, as well as ?;ifts and other

donations, go into the fund to provide the money to pay the

claims, The basic aspects of the law are mandatory: (l)

county commissioners shall create a fund, (2) they shall

establish a budget for the indigent hospital claims, (3) they

shall impose a levy for the purpose of raising the necessary

money, and (4) the hospitals shall be paid the actual cost

incurred in the care and treatment of the indigent person.

The bill also requires that, if the levy needed to pay

the claims VTÍII exceed the 20 mill constitutional limitation,

a special election must be called to vote on the question.

If the voters reject the spe*cial levy, the hospitals may

submit the claims and bring suit for court judgment. It

further provides that the Indigent Hospital Claims Board

29 Ibid.

30 , "New Mexico Hospitals Win Coverage ror

County Indigent Care," The Modern Hospital. CIV(>íay,1965) ,204.

32

shall pay for that portion of a hospital's costs incurred

in the care of a welfare client not covered by the welfare 31

payment.

States now have the opportunity to go a long way to-

ward making it possible that no citizens of the United States

are deprived of the health or medical care that they need

because they are too poor to pay the cost, Title XIX of

the new Medicare Act has expanded the possibility for welfare

benefits for the indigent, But unlil<e the federally admin-

istered insurance provisions, the benefits will not

materialize without state and local action,

One state, California, has taken action on state wel-

fare benefits for the needy, The California Medicare Law

was passed to implement Title XIX in Califomia, and is the

first such legislation to be passed by a state,~ The new

legislation will combine several previous federal and state

financed programs into one. It establishes a program of

basic and extended health benefits to public assistance

recipients, and medically indigent persons, handicapped

children, the blind, the pa-'tially or permanently disabled.

- lbid.

^^Ellen Winston, "How Title XIX Expands Welfare Benefits," Hospitals. XXXIX, (September I, 1965), 60.

33 Alfred E. Maffly, "The California Medicare Law

Changes the Functions of County Hospitals," Hospital Management. CI (February, 1966), 45-46.

33

These groups have long been cared for in Galifornia under

various welfare laws and were given full medical anc hospital

care in county hospitals, The big difference in the new

Califomia medicare bill is the complete change in the

functions of county hospitals, Welfare and other patients

will no longer be required to get this service in the county

hospitals, but will hereafter be entitled to choose their

own personal doctors and be admitted to the hospitals of

their choice, be it a county hospital or a private one.

Private doctors and hospitals vdLII be paid by the state the

reasonable rate for these services. Teaching hospitals

vd.II no longer have indigent patients as teaching material

for interns and residents, as there will be no indigent

patients; all vd.II be treated as private patients and teach-

ing will have to be done with private patients. The impact

of the California Med-Cal Act on the health care in

California ultimately will be much greater than that of the

34 federal medicare act,

Hospitals today have a responsibility to the public »

to operate efficiently and on good business principles,

In order to do this, they should provide for good financial

arrangements of a fair charge to paying patients, and full

reimbursement for the services provided to the medically

indigent. In many cases, state, county and city welfare

^^lbid.. 46.

34

departments, confident that no hospital will tzurn the

indigent sick from its door, set up take-it or leove-it rate

schedules far below the actual cost of the services they

demand.

The city's responsibility has been pointed out along

with a few problems encountered under the present svstem.

An attempt has been made to point out who are the medically

indigent, to point out that the le -al responsibility for

medical indigents rests vTÍth the county, to point out one

city's practical approach to the subject, and to show the

need for more financial responsibility by the county govem-

ment. The practice of charging losses from the indigent

sick on to the cost of the solvent sick, or the private

hospital itself is a situation that must be remedied.

State programs are primarily restricted to certain

groups and leave no doubt that hospitals are carrying a

state-wide responsibility, which is apparently largely un-

knovm to the general public. The taxpayers surely cannot

justify this present condition of giving care to all in

need until our citizens in each county or other political

subdivision provide either voluntary contributions or a

broad-based tax budget adequate to pay in full for indi-

gent medical care in Texas.

The hospital district, a comparatively new solution

to the problem, has become very popular in large metropoli-

tan areas as well as smaller communities. Many of the

35

criticisms of earlier indigent financing are solved in this

manner. This separate taxing jurisdiction provides a sound

fiscal base for hospital operations.

CHAPTER III

THE LEGAL RASIS OF TEXAS HOSPITAL DISTRICTS

In 1949 the 5lst Texas Legislature proposed s consti-

tutional amendment to authorize establishment of hospital

districts in certain counties, which was defeated at the

polls in the November elections. Two years later Dallas

legislators introduced two similar proposals to the legis-

lature, but both failed to pass. However, in 1953, the

legislature succeeded in passing a hospital district amend-

ment, which was subsequently ratified by the voters in

November 1954. The new law, which became effective with

passage of the constitutional amendment, authorized the

establishment of districts in counties having a population 2

of 190,000 or more, and Galveston County.

A hospital district, like all special districts, is

a separate and distinct unit of government. It has its

ov^ goveming body, possesses independent means of raising

money to finance its operations through bond issues and

taxation, and has such corporate powers as the right to

Constitution of the State of Texas, Art. IX, Sec. 4.

^V. A. C. S..Art. 4494N.

36

7

make contracts, acquire and dispose of property, eminent

domain, and perpetual succession. Although hospital dis-

tricts are in every sense units of local government, they

differ substantially from such traditional units as cities

and counties. Most special districts, and all hospital

districts, are single-purpose or unifunctional r.ovcrnments.

The 1954 constitutional amendment authorized the

establishment of hospital districts in the following 10

urban counties: Harris (Houston), Dallas (Dallas), Bexar

(San Antonio), Tarrant (Fort Worth), £1 Paso (EI Paso),

Jefferson (Beaumont, Port Arthur), Galveston (Galveston),

Travis (Austin), Nueces (Corpus Christi), and Hidalgo.

Within each eligible county, the actual organization of a

district is a local proposition. A county may not form a

district until an election has been held and the Droposition

has been approved by a majority of the property taxpaying

voters participating in the election. The election may be

initiated by the commissioner's court on its own motion, or

upon petition of 100 resident property ovmers within the 3

county.

Under the original act, the clause "providing for the

levy of a tax not to exceed seventy-five cents (75c) on the

one hundred dollar ($100) valuation" was required. For

•^Thrombley, oj . crc., 84. 4 V. A. C. S.. op. cit., Sec. 1.

38

strategic reasons, however, proponents in Houston and Harris

Comty succeeded in getting an "Optional Hospital District

Law" through the 1957 Legislature which permirs the comiáis-

sioners'court to set the maximum tax levy lower than 75

cents. This 1957 law also makes the commissioners' court,

rather than an appointed board, the policy and sunervisory

body for the district.

Once formed, the district assumes full responsibility

for public hospitalization within its jurisdiction. All

hospital facilities and other related assets and liabilities,

including outstanding hospital debt, oxmed by political

subdivisions wâthin the district become the property of the 6

district. No governmental unit which surrenders its hos-

pital function to the district may again levy a tax or incur

a debt for hospital purposes. General units do not thereby

relinquish any of their taxing powers; they merely shift

the burden for public hospitalization to the newly formed

district.

The governing body of a hospital district, known as

the Board of Hospital Managers, is appointed by the commis-

sioners' court. Board members, not less than five nor

^lbid., Sec. I.

^lbid., Sec. 13,

7 Ibid., Sec. 1.

Jí9

more than seven, are appointed for two-year terms anc serve

without pay. The board is authorized to appoint an adrrin-

istrator, who serves as the district's executive officer,

and all other district employees. The commissioners' court

is the district's agent with respect to district taxation Q

and the issuance of bonds. The district tax levy is set

by the board of hospital managers, but is subject to final

approval by the commissioners' court. District taxes are

collected by the county tax assessor and collector and 9

county tax rolls must be used.

The constitutional breakthrough in 1954 was followed

first, by an attempt on the part of the state's five

largest metropolitan areas to form districts, and second,

by a later rash of legislation authorizing the establish-

ment of districts in less populous areas. Countywide

elections were held in Harris, Dallas, Bexar, Tarrant, and

EI Paso for the establishment of hospital districts. Dis-

tricts were approved by the voters of Dallas and Bexar

Counties. The voters of Harris, Tarrant and EI Paso

Counties rejected propositiohs to establish hospital dis-

tricts. Dallas and Bexar County elections were supported

by active and enthusiastic groups of private citizens and

^lbid., Sec. 1.

9 Ibid., Sec. 2.

40

public officials. There was no si.' nificant orpranized

opposition in either county, and in both the proposition

carried easily. In Harris, Tarrant and ZI Paso Counuies,

opposition to establishment of districts was very effective,

and the plans were defeated. Subsequently, districts have

been established in both £1 Paso and Tarrant Counties. A

close look at the district elections of the Houston and

Dallas metropolitan areas will illustrate the pattern set

in other elections.

Dallas County held its election for a hospital *dis-

trict on December 23, 1954. The proposal passed by an

approximate four to one majority; however the vote turnout 10

was light. The proposal to substitute a hospital dis-

trict for a city-county hospital system had received sub-

stantial organizational support between thetime of passage

of the constitutional amendment and election day. Elective

officials almost to the man were on record as supporting

the new special district gov^mment. AII 22 mayors of the

incorporated cities in Dallas County worked for its passage.

Also contributing their suppbrt were the two metropolitan

newspapers, and the Dallas County Medical Society.

Therefore, vigorous city and county administrative support.

10 Dallas Morning News> December 24, 1954.

II Thrombley, OTÎ. cit. , 87.

41

important newspaper promotion, approval of the local medical

society, and the absence of organized opposition, combined

to insure success of the district proposal.

In September of 1955, nine months after the creation

of the Dallas Hospital District, Houston held its first

election for the establishment of a district in Harris 1 2

County. By a three to one vote, the plan was defeated.

The Houston plan was led by a private group •<nown as the

Harris County Hospital District Association, the Harris

County Judge and the Mayor of Houston. Harris County

physicians were unorganized, but some individual doctors

did lend their support. The opposition was led by the Tax

Research Association of Houston and Harris County, and by

the II member executive board of the Harris County Medical 13

Society. The proponents of the creation of the hospital

district used three main appeals for establishment. First,

because the hospital would operate from a better and more

stable financial base than the existing city-county system,

it would provide a higher level of hospital care and treat-•

ment. Second, the establishment of a district would elimi-

nate the inequity of double taxation present in the current

system. Third, the new city-county hospital planned for

12 rbid., 88.

13 Ibid., 89.

42

the Houston area would not be constructed unless a hos-

pital district was established in Harris County.

The Tax Research Association in opposin^ the ristrict

establishment, felt that the public hospital function is

a legitimate and proper function of the county í?;overnment.

The creation of another taxing district would only add to

the complexity of local government. The Association rea-

soned that the creation of the district would elirr.inate

double taxation in the present system, but would add one

more taxing layer of government on the Houston County pro-

perty owner.

The opposition of the executive board of the Harris

County Medical Society toward district establishment was

undoubtedly of major importance in the plan's defeat. Some

of the arguments made by members of the executive board

were irrelevant to the election in question, but this may

have helped their cause. The board advanced six points of 14

opposition to the district in their program.

(1) The district would set a precedent for other governmental agencies to seek status indepen-dent of city and county rule;

(2) the addition of a district tax would be unfair to county taxpayers;

(3) the district's appointed board would further remove control from the people;

14 Ibid., 90.

43

(4) the new hospital to be constructed bv the district would be in unfair co ^ .oetition with other non-profit hospitals in the county by charging those patients able to pay for their care and treatment;

(5) it is not ,,ood policy to allow district hos-pitals to contract with the federal government for patient care and treatment; and

(6) facilities for the indigent should be spread over the county and not located exclusivelv in Houston.

Four times during the ten year period of I955-I965,

Harris County voters defeated the hospital district plan

that would have taken over the collecting of taxes for the

administration of their two charity hospitals, Jefferson

Davis and Ben Taub. The fourth election, x Thich resulted

in defeat for the creation of a district was held January

23, 1965."'• The vote was 53,876 against, and 44,905 for.

Mayor Louie Welch of Houston said "The result of this vote

will cost taxpayers more in the long run if we are to pro-

vide adequate medical care for the indigent." Jan De

Hartog's book, The Hospital, initially caused the Houston

furor that led to the hospital district election. It

caused an immediate sensation in the press. Hospital con-

ditions, according to Mr. Hartog were overcrowded and under-

staffed.

. Modern Hospital^ CIV (February, 1965), 179.

44

Harris County Hospital District was finally approved

by the voters on November 20, 1965. A seven member board

was appointed by the Harris County Comirássioners Court to

administer the new county hospital district, Th.3 court

approved a 1.8 million supplemental budget to finance the

district's operations until next year's tax collections.

Up until 1962 hospital district le rislation in Texas

was expedient and piecemeal, Local organizations in order

to establish hospital districts with the pov/er of the dis-

trict to support itself, had to obtain a constitutional

amendment which of course. required a vote at the general

election, and then to have enabling legislation enacted

after ratification of the constitutional amendment, before

those desiring to establish such a hospital district could

begin the actual task of creating such a structure,

On July 17, 1961, H.J.R. No. 51 was finally approved

by both the House and the Senate, This was a proposed

constitutional amendment to allow the legislature to create

hospital districts without the necessity of each and every

hospital district having to *first require approval by

virtue of a constitutional amendment and their legislative

Fort Worth Star-Telegram, November 26, 1965,

17 Philip R. Overton, "Hospital Districts," Texas

Hospitals, XVIII (April, 1963), 32.

45

approval. This is the amendment that was voted on by the

people of the State of Texas in Kovember of 1962. The amend«

ment passed and was added to Article 9 of the Texas Con-

18 stitution. There have been various questions as to

whether or not the election pursuant to establishin,'?; the

hospital district must be prior to the passage of the bill

in the legislature authorizing the establishm.ent of the

district. The second paragraph of the section .- ives some

I9 indication as to what this procedure should be:

Provided, however, that no district shall be created except by act of the legislature anc th.n only after thirty (30) days public notice to the district affected, and in no event may the legis-lature provide for a district to be created \-7Íth-out the affirmative vote of a majority of the taxpaying voters in the district concerned.

It is felt that the better procedure for establishing

such districts under this particular section of the con-

stitution is to first provide for the election in the dis-

trict affected, and after having received a majority vote

of the qualified property taxpaying electors at an election

called for the purpose, then submit the matter to the

legislature for creation oJ the district previously author-

ized by the electors thereof. In this manner the people

^"Constitution of the State of Texas, Art. IX, Sec. 9.

^^má.

^;6

directly concerned take the initial action for the estab-

lishment of such a district, With this action havin- been

taken, it is felt that the legislature is in a bctr.r

position to know and appreciate the desires of tho elcc-

torate concemed and cantl-joreby act in a more informed and

consistent manner, This too, would alleviate the problem

arising from the legislature having initially enacted

authorization for the establishment of a hospitnl district

and the voters affected later refusing to ratify and author-

ize such a district to be created.

Since 1954, 25 hospital districts and authorities

20 have been established in Texas, Of this number 18 are

hospital taxing districts and 7 are non-taxing authorities.

This rate of growth has been experienced throughout the

United States. Between 1952 and 1962, hospital districts

increased greatly, not only in their incidence but in the

number of states where they were used. In 1952 there were

143 such districts in II states, and in 1962 there were

21

418 in 25 states. The greatest concentration of hospital

districts is in the South an*d West sections of the United

States. Also, it is significant that seven of the Texas

20 Texas Hospital Association, Hospitals and P.elated

Institutions in Texas^ I965-I966.

21 Advisory Commission on Inter'^overnmental Relations,

The Problem of Special Districts in American Government, May, 1964, iTl (Hereinafter referred to as A. C, I. -\.)

47

Hospital Districts and Authorities are in metropolitan

areas, while 18 of the new govemments are in very small

communities of 20,000 population or less.

CHAPTER IV

CASE STUDY: AMARILLO HOSPITAL DISTRICT

The Amarillo Hospital District is a local governmental

entity which owns and operates Northwest Texas Hospital,

the School of Nursing, and a District Clinic which provides

medical care for needy and indigent residents. It operates,

through an agreement with the Potter County Tuberculosis

Association, the Under\^od Hospital as a unit of the North-

west Texas Hospital for the treatment of psychiatric patients.

An expansion program is underway for a new psychiatric hos-

pital \> ich will replace Underwood Hospital. The facility

will provide both in-patient and out-patient care. The

District Board of Managers' policy is to provide facilities

and services comparable to those of the most modem hospitals

in the United States.

Creation of the Amarillo Hospital District is a result

of a series of legislative acts and constitutional amend-

ments. At first, emphasis was placed upon the county govern-

ment for responsibility to care for the medical and hospital

needs of the indigent, In I9l3, Texas counties were author-

ized to build hospitals to provide for the needy. The

48

49

county-wide hospital district amendment to the Texas Gon-

stitution in 1954 placed the responsibility of such care

on the district, if such were forracd, prchibiting th- county

or any city therein from imposing a ta:: for inci-cnt: care.'

In 1957, an amendment to the Texas Constitution to create

the first city hospital district was approved for subrr.ission

to the voters by the Texas Legislature. At the sair.e time,

the legislature passed the enabling act which set forth the

body of lav7 surrounding city hospital district activities,

based on that of the county-wide hospital district £~cndm.ent.

On November 4, 1958, the voters of Texas approved the

Amarillo Hospital District amendment to the Texas Constitu-

tion. P.esident property taxpayers created the district by

local election on January I7, 1959, and an amended enabling

act became law by signature of the Governor on March 24,

1959.-

mportant Pro-District Or<^anizations

The new hospital district created by the Amarillo »

voters was a result of a well organized campaign for its

^V. A. C. S.. Art. 4494n, Sec. 13.

^Constitution of the State of Texas, Art. 9, Sec. 5.

3 Amar i l lo News-GIobe. J anua ry 18 , 1959.

XEXAa TECHNOUOGICAL CQU.E:&^

LUBBOCK. TCXAB LIBRAnr JJ

50

adoption. The district is co-extensive vTÍth the city

limits of Amarillo, as now or hereafter constituted, with

Potter County being privileged to participate in the benefits 4

of the district. As officials elected by resident voters

of the district, the City Commission is empowered to name a

Board of Managers for the district, create bonded indebted-

ness for district purposes, and to levy a tax which cannot

exceed 75o per $100 valuation. Potter County Commissioners'

Court may levy a tax up to lOo per í lOO valuation on prop-

erty outside the district and thereby receive medical and

hospital care for needy and indigent persons residin^ in

that portion of Potter County outside the district,

In selling the idea of a hospital district to the

Amarillo citizens, proponents of the plan presented a com-

plete analysis of the financial considerations, In pre-

senting the issues for or against the district, it was

pointed out that for every one dollar worth of services

being bought at the comty hospital, users had paid $1,53

in taxes. The extra 53 cents was going to the treasury of

the State of Texas. Every time the county collected taxes

for running its local services the state collected 42 cents

per $100 valuation. In Potter County \^ere the legal limit

4 General and Special Laws of the State of Texas^ 55th

Le^islature, 1957, 1628-30. 5 Ibid.

51

of 80 cents per $100 was being collected, this meant that

every dollar of local taxes was costing an extra 53 cents 6

m state taxation. By creating the hospital district,

the Texas Legislature recognized that counties which were

willing to give good services to their citizens were being

penalized. The counties v;hich maintain a high degree of

service, such as roads, welfare, and hospitals, must keep

their valuations high to assess sufficient taxes under the

80 cent tax limit provision. Other counties, with few or

no services, frequently pay little or no state ad valorem

tax at all. They value each piece of property so low that

it falls below the $3,000 homestead exemption allowed by the

State of Texas. To correct this situation, in part, a con-

stitutional amendment was passed to allow county hospital

districts to be formed to pay taxes directly to the support

of hospitals. The county can then drop its valuations or

its tax rate to offset income váiich had been needed to run

the hospital. There is no penalty of state taxes on the

hospital district valuations. It was estimated that Potter

County taxpayers would enjoy*a reduction in taxes of at 7

least $33,000 annually.

The City of Amarillo is split at 28th Street by a

county line, therefore maki-ig it impossible to form a

Amarillo News-GIobe. January 11, 1959.

^ bid.

52

county hospital district that would solve the basic problem

of providing hospital service to the entire citv as well as

caring for indigents of the community. This is v;hy zhe 55th

Legislature passed a resolution, asking Texas voters to

establish the first city hospital district in the state,

This recognizes the fact that AmariIIo is in a singular

position of being the only metropolitan area in the state

which lies in two counties,

Taxes of Potter County residents x ere to be reduced,

and for the first time Randall County residents v/ere to

pay some of the cost of a facility v^ich they use, Randall

County residents, located in the south part of Amarillo,

generally realized that they had been having free service.

However, by participating in the cost, they gained the

right to get hospital care for their indigents. The

South Amarillo voters were aware of the consequences that

probably vjould follow if formation of the hospital district

failed. Potter County could no longer carry the burden of

the tax costs VTÍthout a sharp increase in tax valuations. »

As a result the state taxes would also increase. If this

happened, the Potter County Commissioners' Court would

most likely have been justified in clamping dovTn rules of

admission on their county hospital, excluding South Amarillo

residents in favor of Potter County residents. Another

possibility vrould have been to adopt a varyinr, scale of

53

hospital rates on which Randall County residents could be

penalized by higher rates. The Randall County ta:cnavcrs,

faced VTÍth the risk of having to build and maintain their

ovTn hospital, were glad to pay the much smaller cost of

participating in the hospital district, and therefore

spreading the increase over the entire corramunity and making

tax rates lower for everyone,

By constitutional amendment the hospital district

boundaries are always those of the city. If city limits

of Amarillo are extended, the hospital district boundaries

also are extended. The amendment allowed the remainder of

Potter County outside the city limits to participate in

the hospital district by levying a tax rate not to exceed

10 cents per $100 valuation on land outside the city. This

contribution to the hospital district means all the indi-

gent and aged in the county outside the City of AmariIIo

can be cared for by the hospital district. The 10 cent

levy is the maximum under the existing law. The legisla-

ture offered the same bonus to Randall County in the

original bill, however, they*refused.

Potter County taxpayers, by adopting the hospital

district, reduced their taxes. In 1958, the minimum cost Q

figure for indigent patient care was $265,511.00.

8 Amarillo GIobe-Times, January 13, 1959.

Approximately 80 per cent of the county taxable property

lies in the city limits of AmariIIo, therefore city tax-

payers would get county tax bills cut by one-third, and

also the state tax bill would be reduced by 10 per cent.

The proposed tax rate was 16.3 cents per $100 valuation

for the first year of the hospital district operation.

This included the cost of changing from a "cash basis" to

an accrual basis approach to financial operations.

Until the adoption of the AmariIIo Hospital District,

Northwest Texas Hospital had been on a so-called cash

basis, At the end of the tax year, the hospital was with-

out funds to operate during the next month, while taxes

were collected, This type of operation precludes a program

of sound budgeting, and cash grants had to be secured and

other financial devices used that are not sound fiscal

policy, This changeover in policy resulted in a temporary

increase in taxes for one year, Any permanent improvements

to the new district would require voter approval, The tax

assessed at the beginning was operational plus the interest

and sinking fund requirements on $1,304,000 of outstanding 9

bonds, Often when hospital districts are created, there

is a bond issue to build new facilities or improvements,

but in the case of the Amarillo Hospital District, there

9 bid.

was no bond issue involved, The Northwest Tcxas Hospital

was expanding in 1959 by virtue of a $600,000 bond issue

voted by Potter County residents in 1958.

The creation of the AmariIIo Hospital District is, and

was in 1959, a part of a long range plan worked out by

leaders of the community, It provides a way to solve most

economically the problems of tax supported hospitals. The

district is part of the planned AmariIIo Medical Center, a

complex to serve the trade territory of the city. Medical

facilities are important to a growing community, Industries,

in studying sites for new.plants, are always interested in

what cities have to offer in hospital and related health

care facilities. The AmariIIo Medical Center should be a

blend of privately endowed and tax supported institutions.

Citizens of Amarillo reflected its support of the center

by producing voluntary dollars for the Plains Hospital

Fund to build a five floor wing to privately owned St.

Anthony's Hospital.

To illustrate the need for the creation of Amarillo

Hospital District, proponents of the plan pointed out the

consequences of failing to adopt the measure. First,

Potter County citizens would have been faced vTÍth a

costly hospital bill since the county bv law must provide

for the indigent ill. The only way for the county to in-

crease revenue was to raise the property valuations. The

56

consequences of failure to Randall County residents were

even more perplexing, The possibility of having to build

their ovTn hospital for indigent patients was not a rcalistic

approach, The unique position of AmariIIo being the only

metropolitan area in the state divided by a county line

creates special problems, The City of AmariIIo needs to

solve its problems as a unit, not as a split personality,

The problems of gro -Tth in the future would be insurmount-

able, Texas constitutional law is tied to,countv control

of problems as hospitalization and indigency, and ÆmariIIo

needs to establish the principle of being entitled to

special laws because of this uniqueness, By having a

special governmental unit for hospital care, AmariIIo can

operate with more economy and efficiency,

The successful campaign for the adoption of the

Amarillo Hospital District was guided by the Amarillo Area

Foundation Hospital Committee. Members of the committee

included the chairman of the Citizens Health Council; a

representative of the Lay Advisory Board of St, Anthony's

Hospital; the chairman of the Board of Managers of North-

west Texas Hospital; a representative of Potter-Randall

Medical Society; a member of the medical staff of Northwest

Texas Hospital; a member of the medical staff of AmariIIo

Osteopathic Hospital; a city commissioner; the County

Judge; and a representative of the medical staff of St,

57

Anthony's Hospital, Others who sit regularly with the

thirteen member hospital committee at its weeklv Tectin'TS

are the superintendent of Amarillo Veterans Hospital; v^ng

surgeon at Amarillo Air Force Base; the mayor of AmariIIo;

the city manager; a representative of the Panhandle Chapter

of the American Institute of Architects; a countv commis-

sioner; the administrator of St. Anthony's Hospital; the

administrator of Northwest Texas Hospital; and the director

of Amarillo Bi-City-County Public Health Unit,

The Foundation Hospital Committee also sponsored

television appearances in support of tho district for its

adoption. Appearing on panel discussions were Chairman

F. V. Wallace, Mayor John Armstrong, County Judge W. M.

Adams, Mr. A. E. Herrmann, member of the Foundation Com-

mittee, and Dr. Robert F. Hyde.

The Amarillo Area Foundation Hospital Committee un-

doubtedly was the single most important or<rai.ir;ation in

favor of the hospital district, however, twenty other

civic groups and orgranizations formally endorsed it.

Included in this group were:*Amarillo Federation of Women's

Clubs; Amarillo Chamber of Commerce; AmariIIo City Commis-

sion; Amarillo Association of Health, Recreation and

10 AmariIIo Daily News, January 16, 1959,

^^ bid.

53

Welfare Workers; Amarillo Area Foundation; Amarillo American

Business Club; Central Labor Union; Council of Givic Glub

Presidents as individuals; Citizens Health Council; Morth-

west Texas Hospital Board of Managers; Palo Duro American

Business Club, Potter County Commissioners' Court; Potter-

Randall Citizens Committee; Potter-Randall County Medical

Society; Pilot Club of AmariIIo; South AmariIIo '/ivzanis

Club; South Amarillo Lions Club; South and West AmariIIo

Rotary Club; 20-30 Club of AmariIIo; and the Women's Aux-

iliary, Potter-Randall County Medical Society, The civic

committee of the AmariIIo. Junior League conducted a tele-

phone campaign to get out the vote, More than a score of

other civic organizations discussed the district formation,

but because of charter rules could not give formal endorse-

ments. However, as one civic club president said who re-

ported that most of his club members approved the district

as individuals, the follovd.ng reasons for adoption were

expressed:

(1) Because of its geographical location, Amarillo could become the medical center of the Great Plains;

(2) a medical center would mean employment for a great many people of the area;

(3) the hospital district could provide a way to keep tax money in this area in-stead of sending it to Austin.

12 bid.

59

Because of the conflict of interest that - i rht arise

between a tax supported hospital and the hos-Dital oocrated

by the Order of the Sisters of Charity of the Incarnate

Word, St. Anthony's, no resolution of support of the dis-

trict election was sought. Yet at a January 14, 1959,

meeting a letter was presented bv Sister Marie Vianney,

13 administrator of St. Anthony's, which read:

The purpose of this letter is to clarify the attitude of St. Anthony's Hospital toward the January 17, 1959, election for the Amarillo Hospital District. Our interests lie in eivin^ service to the community, and in the entire program of providing the facilities for render-ing service to the sick and injured, whether at St. Anthony's, or one of the other hospitals. A spirit of interested cooperation, rather than competition is necessary in order to care for the Amarillo area. We have received such coop-eration from the other hospitals.

We do wish, however, to assure the committee that if the hospital district election will be aided by our participation, endorsement, or sup-port, we vd.ll give it wholeheartedly.

The Election

The election to establish Amarillo Hospital District

14 was held January 17, 1959. The ballot read:

For the creation of a hospital district providing for a levy of a tax not to exceed seventy-five

13 Ibid.

14 Amarillo Dailv News. January 17, 1959.

60

cents (75o) on the one hundred dollar (Í IOO.OO) valuation;

Against the creation of a hospital district nro-viding for a levy of a tax not to exceed seventv-five (75o) on the one hundred dollar (S100.00) valuation.

There was no bond issue involved, and the proposed tax

rate was 16.3 cents. Mr. F. V. Wallace, chairman of the

Amarillo Area Foundation Hospital Committee, was quoted as

saying,

The AmariIIo Hospital District Ie7,isIation followed the form of the old county hospital law, and the ballot as approved by the legislature, has the same wording. The tax rate, however, VTÍll be set each year, based only on recuirements for caring for the indigent and needy and for pay-ing off bonded indebtedness on the hospital, left over from earlier construction, and the present expansion program. Any enlargement programs in the future VTÍÍI have to be voted by the AmariIIo citizens in the form of a bond issue.^^

The Amarillo voters approved the formation of the

first city hospital district in the state by a margin of

5 to 1. The total vote cast was 2,276, 1,924 for and 352 16

against. The turnout was considered to be fairly heavy

for a special election. Randall County voters, who

accepted some of the tax burâen which had hitherto been

carried entirely by Potter County residents, approved the

district in about the same proportion as the Amarillo voters

in Potter County (see Table 1).

^^lbid.

l6 ^ AmariIIo News-Globe, January 18, 1959.

61

Box

1

2

3

4

5

6

7

8

9

10

11

12

13

14

AMARILLO HOSPITAL

Place

Auditorium

McKinley

Wilson

TABLE 1

DISTRICT

Alice Landergin (Randall County)

Lamar (Randall County)

Wolflin

Bivins

Avondale

Sam Houston

San Jacinto

Horace Mann

Forrest Hill

Sanborn

Carver

TOTALS » 1

ELEGTION

For

56

112

162

220

92

200

292

196

244

135

73

43

77

22

,924

RESbT TS

Aí;ainst

14

32

22

73

51

16

21

15

22

28

23

18

16

1

352

The spectacular results of the election to adopt the

Amarillo Hospital District vjere a result of a well organized

campaign conducted by the civic leaders of Amarillo, How-

ever, there was another important factor in the successful

establishment of the special governmental unit. There was

62

virtually no opposition to its adoption. The Icaders of

the district gave all the pertinent facts to thc public and

they approved the proposal. There was a comDlete lac:c of

organized opposition even in Randall County vhich í tood to

absorb the greatest increase in taxes.

The official name for the district was set as Amarillo

Hospital District. The hospital district took over the

operation, maintenance and sinlcing fund requirements for

Northwest Texas Hospital, vtiich was started in 1922 by

Potter County. The district is operated under the super-

vision of a board of managers. The City Commissioners

appointed the board members, serving with staggered terms

so that no commission would be able to appoint a full

board after the initial formation. The six member board

of managers for Northwest Texas Hospital at the election

all agreed to serve and continue in their positions. The

members were A. D. Foreman, Chairman, F. V. Wallace, Dr.

Kenneth Flamm, Leo Southern, Philip B. Carlson, and Dr.

Frank Duncan.

First tax bills for support of the district were sent

to city taxpayers on October I, 1959. The county tax rates

were reduced in proportion to the hospital costs for 1958.

A lowering in valuation of property voted by the county

commission, also saved on state taxes. The district tax

was levied as a special tax, and collection is on the same

billing jointly used by the city, the AmariIIo Independent

63

School District and AmariIIo College.

From all indications, the district approach in

Amarillo has been highly satisfactory, The district approach

has proved superior to the county system, and most lihclv

future tax supported facilities in AmariIIo \i7ill use the

same approach.. Since the inception of AmariIIo ?:ospitaI

District the tax levy has been 16 cents per $100 valuation.

The tax funds are used to provide needy and indigent hos-

pital care and medical care at the District Clinic; to

retire bonded indebtedness on district facilities; to pro-

vide new facilities of the district; to operate educational

programs; and to pay the nominal expense of tax collections

and district administration, It is the policy of the board

of managers that the hospital operate on a self-sustaining

and business-like basis v/ith prudent funded reserves for

depreciation and adequate allowances for uncollectible

accounts. This is being accomplished by the AmariIIo Hos-

pital District at a cost of $6.39 per patient day below the

national average of $41.58.

17 ., Hospitals, XXXIX (August 16, 1955), 137.

CHAPTER V

CONCLUSIONS AND RECOMMENDATIONS

Hospital districts in Texas have been created pri-

marily because existing units of general government oi many

areas have not provided adequate hospital service for the

citizens of its community. A.Iso, in some cases there is a

need to meet a particular local governmental or political

problem. A contributing factor in the creation of hospital

districts is a result of state constitutional and statutory

restrictions on the powers of general local government be-

cause they limit the scope of action available to general

local government in responding to the needs of the people.

Even v^eré limitations are not present, general government

often has been unable to find an acceptable political means

of responding readily to public needs. In such an atmosphere,

citizen groups press for the creation of a special district

because this device provides*a relatively easy and direct

means of satisfying the hospital service need.

Conclusions

In general, the public appears to be satisfied with

services received where hospital districts have been created.

64

65

So far, hospital districts have resolved the nroblems

which spawned them and have met the demands for oublic ser-

vices in an adequate fashion. Local govemment must be

responsive to the needs of the people of the community.

The use of a hospital district is entirely justified as a

means of meeting these needs if the local units of general

government do not or cannot respond,

As yet, hospital districts are not a significant part

of the total number of special districts in Texas, but it

is clear that their creation is steadily and persistently

increasing. As problems of local government become more

difficult, the more apt a solution is found by establishing

a special district. To some extent, the special hospital

district is a result of weakness in both state' and local

governmental units. If the present growth of special dis-

tricts continues, in large urban areas particularly, it

looks as if in the future, there will be a separate and

independent unit of government for most major functions.

The hospital district is a good example of this trend in •

the large cities of Texas.

Hospital districts have a number of advantages over

other governmental units in Texas.

(1) Since the constitutional change in 1962, they are easily formed;

(2) they can be used to straddle political boundary lines;

66

(3) their formation does not threaten the existence of other governments;

(4) they may be used to circumvent archaic constitu-tional and statutory tax and debt lirâics; and

(5) they are highly flexible as to area served,

A major criticism of any special district is that there

is no method of coordinating the activities perforr.ed by

other governmental units, The multiplicity of SDecial

districts often prevents the citizen from knowin^; exactly

váiat is going on in his community. The programs of many

districts appear to be completely independent from, and

uncoordinated with, similar programs of general government,

The services of today' s cities are becominc; more inter-

related every day, and the efficiency of the organization

is determined to no small extent by the amount of overall

coordination of all governmental units, It is difficult

to separate a group of functions like education, planning,

health and hospitals, housing and others, According to

The Advisory Commission on Intergovernmental Relations,

the impact of various types of districts on fragmentation •

of governmental and political responsibility differs

significantly. Hospital districts undoubtedly contribute

little to fragmentation.

A second important criticism leveled against hospital

districts is that they are undemocratic. The critics of

A. C. I. R.. op. cit,, 68,

67

special districts feel that district activitics are obscured

from the public eye by infrequent and little publicized

meetings, a lack of public reporting, and dis -uisec tax

bills. As in the case of The AmariIIo Hospital District,

where tax bills are part of the City of AmariIIo billing

procedures, many people are not aware of the hospital's

cost, This results, many claim, in the public bein?; nre-

cluded from influencing district operations. The district

may be efficient, competent, self-supportinc?. government,

but it is not self-government, However, this criticism is

not as valid as it first appears because many of the dis-

trict directors are appointed by responsible public offi-

cials such as city councils and mayors,

Hospital districts created in Texas communities, in

effect increase the tax burden on the local citizens, In

order to provide the level of service desirable, m.ore taxes

have to be collected, This increase in the cost of total

governmental services for the community, has resulted in

the charge that district services operate uneconomically,

Some daim there is a duplication of administrative burdens

and costs for borrowing for capital improvements due to

heavy use of revenue bond financing which is often exces-

sively high,

Indigent patient care in Texas has been ne.' Iected

very badly. John Sealy Hospital in Galveston, Texas, is

the only state supported general hospital for indigent

patient care. Other state hospitals are restricrec ro

certain groups of the aged and long term illnesses. Othcr

states have had this same problem, however, New Mexico and

California are examples of states which have recentlv en-

acted legislation to solve the problem of hospital care

for the needy. As long as the Texas Legislature continues

to not meets its obligations, there VTÍII be a need for

local action, such as the establishment of hospital dis-

tricts.

Only in rare instances have cities and counties been

able to work suitable agreements to care for the mec'ically

indigent. This stand is supported by the fact that only

six per cent of hospitals in Texas are controlled by munic-

ipalities. Most city and county governments are in constant

conflict over a workable program for adequate financial

responsibility for indigent care, An example of county

authorities failing to meet their obligation is Lubbock

County, There are approximately 185,000 people in Lubbock

County and there are no public hospital facilities whatso-

ever for the indigent, Since governmental agencies in

Texas provide only a fraction of the cost of hospital care

for people unable to pay, the responsibility falls on pri-

vate institutions, v^o in tum must pass the costs on to

paying patients. This is an unfair practice.

It is clear that hospital districts have a positive

role to play in the structure and operation of local

69

government. There should be effective control over the

existing districts and reasonable restrictions on those to

be created in the future. Therefore, statutea and policies

designed to regulate the use of special districts ~ust be

structured so as to insure that districts can best perform

their role VTithout creating more problems than they solve,

Hospital districts in many parts of Texas fill a gan in

the structure of local government and the needs of the

people,

Recommendations

The foIlovTÍng recommendations formulated here are

based on the belief that hospital districts \^II continue

in existence for some time, that many communities will con-

tinue to turn to their use, and they play an important

role in the govemmental process,

The first recommendation is that state legislatures

should broaden existing legislation to provide that no

hospital district be created prior to review and approval

of the proposed district by the appropriate body of the

counties and cities involved, within which the proposed

district vjill operate. Not only should the question of

need for the service be involved, but víhether the proposed

district is the best means for providing the service,

A second recommendation would be to insure by lectis-

lation that the activities of existing and subseouently

70

created special districts are coordinated VTith the

activities of units of general government. The most im-

portant factor relates primarily to the location o:

hospital facilities. Giving the general ;overn;?.ent unit

authority to select the facility site will help reduce the

possibility of the district's activities havinc an adverse

effect on the units of general government. This will in-

sure proper coordination of general government an-" those

of the district.

A third recommendation is that the local elected

authorities of the county. and city be informed of the

creation and operation statements of all hospital districts

in their borders, Many local officials are not well

acquainted with the operations of hospital districts,

Often there are no formal requirements for hospital dis-

tricts to keep any agency of government informed of their

activities. The larger hospital districts are more apt to

make information available to the general public and to

government officials than are the smaller hospital operations

A fourth recommendation*is that all district hospital

service charges be reviewed by the governing body of a

unit of general government, Many times the price of ser-

vice is no way subjected to scrutiny through the regular

political processes of the community. This aspect of dis-

trict operations is particularly sirînificant because most

71

of the districts which levy service charges are f>overned

by boards of directors who are not popularly elected.

A fifth recommendation is that cities sendinr- out

their property tax bills or providing receipts, include in

each property owner's bill a clear listing of district

property tax. l'Jhere counties or cities collect taxes for

hospital districts, district taxes often appear as a code

number on a general tax ledger. This practice is mis-

leading and confusing to the citizens. AIso, local govem-

ment units in preparing annual reports of their operations

should include pertinent information on the activities of

the hospital district operating vTithin the municipality or

county.

The principal justification for the creation of hos-

pital districts wlth the power to tax is the inability of

general government on the local level to adequatelv finance

the hospital fxinction. Where hospital districts have been

created, a higher level of public hospital care has re-

sulted.

3I3LI0GRAPHY

300KS

Bollens, John C. Special District Governm.Gnt in rh-, United States. Berkeley: University oi Gaiiiornia Press, 1961.

Hartog, Jan de. The Hospital. New York: Atheneum Publishing Company, 1964.

• Hospital Care in the United States. Commission on Hospital Care. New York: The Commonwealth rund, 1947.

Advisory Commission on Intergovernmental Relations. The Problem of Special Districts in American Government. Washington: Government Printing Office, May, 1964.

Smith, Robert G. Public Authorities, Soecial Districts and Local Government, National Association of Counties Research Foundation, 1964,

Thrombley, Woodworth G. Special Districts and Author-ities in Texas. Austin: Institute of Public Affairs, The University of Texas, 1959,

PUBLIC DOCUMENTS

Constitution of the State of Texas,

General and Special Laws of the State of Texas, 55th Legislature, 1957,

U. S. Bureau of the Census. 1962 Census of Governments: Vol. I. Govemmental Organizations. Washington: Government Printing Office, 1963.

Vernon's Annotated Civil Statutes of the State of Texas.

72

73

PERIODICALS

I >

Alderfer, Harold F. "Is Authority rinancing thc . .navcr.' The American Citv. (rebruary, 1955), 115-116.

American Hospital Association, Hospitals Guide Issue. XXXVIII (August I, 1964),

Cavness, Don. "The State's Responsibility for ndi.-cnt Care," Texas Hospitals. XX (October, 1964), I9-2I.

Davis, Gordon. "Charitable Aspects of Hospitals Should Be Clarified for the Public," The Modem Hospital. XCVIII (May, 1962), 12.

. Modern Hospital. CIV (February, 1965), 179,

"Let's Look Again at Special Districts," Public Management, XLVII (January, 1965), 1-3,

Dixon, Dr. James P. "The Community, Responsibility for Medical Care," American Journal of Public Health, XXXIX (January, 1959), 76-80.

Gill, John. "Community Financial Participation," Texas Hospitals. XX (November, 1964), 19-21.

Gulick, Luther. "Design for the Future," National Munic-ipal Review^ XLVI (January, 1957), 6-13.

Hankerson, James A. "Special Government Districts," Texas Law Review. XXXV (October, 1957).

Maffly, Alfred E. "The California Medicare Law Changes the Functions of County Hospitals," Hospital Management. CI (February, 1966), 45-46.

Maisel, Albert Q. "Why Hospitals are Chronically Broke," The Kiwanis Magazine, (October, 1959), 45-47.

Muller, Charlotte. "Income and the Receipt of Medical Care." American Journal of Public Health^ LV (April, 1965), 510-521.

Overton, Philip R. "Hospital Districts," Texas Hospitals^ XVIII (April, 1963), 32.

Parker, Leo T. "Review of Kospital Lawsuits," -o< nitaI Topics^ XL (October, 1962), 58.

74

Poire, Nora K. "Metropolitan Medical ::cono.~ic- " Scientific American. CCXII (January, 1965)^ 19-27,

Tobias, Ben. "Joint City-County Responsibilities," Texas Hospitals. XX (November, Iv64), 1. ,-25.

• .• Kospitals, XXXIX (Au-ust I6, 1965), 137.

Walters, F. S., Jr, "The Historical Approach and the Hospital District," Texas Hospitals. XX (October, 1964), 18-24. "

Winston, Ellen. "How Title XIX Expands Welfare Benefits," Hospitals. XXXIX (Sepcember I, 196 5), 60,

. Modern Hospital. CV (December, l9o5), 166.

^v,^. . "Medical Care for the î- eedv," Joi >-n-,l o^ Am.erican Medical Association, CLXXXII ('/.arch 9, 1963), â^i.

. "New Mexico Hospitals .Win Coveraîte for County Indigent Care," The Modern Hospital, CIV (May, 1965) 204.

. Hospitals, XXXVI (May 16, 1962), 23,

. The Modern Hospital, XCII (March, 1959), 183.

. Texas Hospitals, XIX (July, 1963), 4,

• American Joumal of Public Health, XLIX (November, 1959), I543-I545.

. The Modern Hospital. CV (November, 196'^), 28,

NEWSPAPERS

AmariIIo Daily Nevjs. January I6 and I7, 1959,

AmariIIo Globe-Times. January 13, 1959,

Amarillo News-GIobe. January II and 18, 1959.

ppllas Mornin.g Nev7s. December 24, 1954.

Fort Worth Star-Teleeram. November 26, 1965,

Lubbock Avalanche-Journal. November 3, 1965.

75

OTHER MATERIAL

AmariIIo Hospital District Annual Renorts, 1959-60 and 1960-61.

Amarillo News-GIobe, City of Amarillo and AmariIIo ! os-pital District Annual Report, 1963-64, Januarv 17, 1965. '

Bedichek, Wendell M. The Texas Gonstitrr.ional 'T-o'"n''--nts of 1962. Austin: The Institute of Public AY.;a:Lrs, Thé University of Texas, 1962.

Institute of Public Affairs, The Fiftv-?ifth Tcxas Lor>is-lature, A Review of Its Work (Universitv oi Texas^ 1957).

Institute of Public Affairs. The Fifty-Si?hth Te::ps LegriS' lature, A Pveview of Its WÔrk (University o: Tc::as, 1963), App. A, Ô2-Ô4.

Texas Hospital Association, Hospitals and Related Inrti-tutions in Texas. 1965-66.