It is, to be sure, a time of warp-speed changes in the nation's health care system. But sometimes, even within its own insurance programs, the government has trouble divining just how swiftly the future will arrive.

The latest evidence of how tricky it can be to predict change comes from Medicare, which recently began to allow hospitals and groups of doctors to set up their own managed-care plans catering only to elderly patients.

Congress authorized these "provider-sponsored organizations" (PSOs) under a 1997 budget agreement in response to pleas from big lobbying groups such as the American Hospital Association and the American Medical Association. The organizations argued that Medicare patients who wanted to join a managed-care plan should be able to bypass the middle men--that is, health maintenance organizations run by insurance companies--and sign directly with them.

After the law passed, the Health Care Financing Administration (HCFA), the branch of the Department of Health and Human Services that runs Medicare, gathered physicians and hospital administrators to negotiate the rules for becoming a PSO. Then, in the summer of 1998, the agency opened its doors for PSOs to apply.

The Congressional Budget Office predicted that by 1999 some 600,000 Medicare patients would be getting care through these newfangled arrangements. By 2002, enrollment would swell to 1 million. Taking its cue from the CBO estimates, HCFA predicted 50 PSOs would be in business by now.

"The thought was we were going to be inundated with applications," says Robert A. Berenson, director of HCFA's Center for Health Plans and Providers.

So how many PSOs exist?


The lone outpost, St. Joseph MedicarePlus, opened for business last March in Albuquerque, N.M., a community where managed care has been especially popular among older people.

"Enrollment has actually been very good," says Janice Torez, president of the PSO, which was started by a local hospital. Slightly more than 4,000 Medicare patients have signed up.

Even so, that means that the CBO's national projections for 1999 "missed by pretty close to 600,000," one government official said.

Why hasn't the idea worked? In the two years since Congress acted, Berenson said, hospitals and doctors have watched with dismay as dozens of HMOs have dropped out of Medicare, complaining that they could not make enough money on their Medicare contracts. As a result, groups that might have started a PSO have, instead, become wary of shouldering complete financial responsibility for elderly patients' medical needs.

"The theory is still valid," says Richard Pollack, the American Hospital Association's executive vice president for government and public affairs. But he said, "The idea of taking on such huge financial risks . . . was something that people were very reluctant to do."

Said Berenson: "It was an idea whose time sort of came and went, at least for now."

HISPANIC HEALTH: HHS has taken noticeable steps forward lately in its campaign to lessen the heavy burden of disease in poor, Latino communities.

The agency's Health Resources and Services Administration (HRSA) issued a report this month, documenting the health risks posed by poverty, poor housing and improper sanitation in a 2,000-mile strip along the border with Mexico. And HHS Secretary Donna E. Shalala announced that HRSA would provide $11 million in grants to innovative programs that provide medical treatment and other help to people in the border region who have HIV or AIDS. The five-year grants will be awarded starting next spring to organizations that work in the southern parts of Arizona, California, New Mexico and Texas.

Those efforts are part of a $400 million initiative President Clinton announced in early 1998 to try to eliminate the health gaps between minorities and white Americans in several key areas by 2010.

Meanwhile, Nelba Chavez, administrator of the Substance Abuse and Mental Health Services Administration, has traveled to community celebrations in Miami, Houston, Los Angeles, Chicago and New York to draw attention to new agency publications designed to coach Hispanic parents on how to help their children grow up healthy.

The booklets and posters in Spanish, part of a campaign called Hablemos en Confianza (Speaking in Confidence), are the result of the agency's first attempt to enlist community leaders and use focus groups to develop materials that hit home with Latino families. "It's not a mere translation" of the agency's English-language publications, Chavez said. "We need to look beyond translation and look at what it really means in terms of communities."