One example Campbell gives is Pennsylvania's decision to limit nursing home growth in the early 1980s. During the late 70s and early 80s, the state perceived both an explosion of nursing home growth and need for nursing facility care by Medicaid beneficiaries. Because Medicaid required states to cover nursing facility care for eligible beneficiaries, the state's expenditures for nursing facility care were increasing at a rate considered alarming by state officials. According to Campell, this led the state to impose a moratorium on reimbursement for capital costs for new nursing home beds, except for projects that had received a "Certificate of Need" prior to September 1, 1982. "Certificate of Need" programs can serve an important gatekeeping function by states - requiring facilities to obtain a Certificate of Need before construction or expansion can be used to ensure that there is an adequate need for the service and that new health care beds are located in the communities where they are needed.

According to Campbell, however, Pennsylvania used this gatekeeping function to prevent new construction in order to curb costs; community need was not considered. In fact, Pennsylvania's actions undermined access to nursing home care for its most vulnerable residents because it "exacerbated financial incentives, already existent in the state's Medicaid reimbursement system, for nursing home operators to seek out a greater share of private-paying customers." Private insurance was more desirable because it typically provided higher reimbursement and Medicaid coverage would kick in after the private insurance ran out. Nursing homes actively sought private pay patients by moving to the affluent suburbs, which had a much larger percentage of white residents over age sixty-five. Thus, Pennsylvania's moratorium had different effects for different communities: Philadelphia, which had a substantial non-white population over age sixty-five, experienced a significant loss in nursing home beds (806); by contrast, the three most affluent counties in suburban Philadelphia which had much higher percentages of white residents over sixty-five (96.4%, 94%, and 98.3%) experienced increases in bed supply (84, 54,and 40 beds, respectively).

In his paper, Campbell considers two other examples of policies that seem to have a disproportionate racial impact: Pennsylvania's implementation of a program designed to fund non-institutional long-term care alternatives to nursing home care for the elderly under Medicaid (the "PDA Waiver" program), and its decision to extend Medicaid coverage to children under age 18 with severe disabilities whose parents' income was too high to otherwise qualify for coverage through the federal disability program, Supplemental Security Income (SSI) program. Such policies clearly look beneficial on their face: health and disability advocates have long pushed for states to fund community-based care that helps people avoid institutionalization, and flexibility with respect to income limits that help children with disabilities get needed care is certainly good health policy. Campbell does not question the value of such coverage.

Campbell's examination of the way Pennsylvania has implemented these programs, and specifically the discretion Pennsylvania uses to determine eligibility requirements for each, does show that its policies may foster racial disparity in terms of access to services and the allocation of public funding. Campbell shows how, in each case, the state has made decisions that either indirectly resulted in a reallocation of services to disproportionately white communities, or a far greater expenditure of resources for programs that have primarily benefitted white residents. Campbell does not suggest that such policies are driven by intentional discrimination; rather he argues that such disparate effects should not be ignored by states.

Campbell points out that his proposal is consistent with recommendations made in the 2003 National Institute of Medicine (IOM) Report, Unequal Treatment: Confronting Racial and Ethnic Disparities in Health Care. This report detailed significant racial and ethnic disparities in health care access and outcomes, even when such groups were insured. One of the IOM's recommendations was "to structure payment systems to ensure an adequate supply of services to minority patients, and limit provider incentives that may promote disparities." Despite the federal government's apparent recognition of the problem, the U.S. Department of Health and Human Services (HHS) has not used its power to address this problem in a meaningful way.

Finally, Campbell joins a number of legal scholars and health advocates in criticizing our existing regulatory system as ineffective at policing health disparities caused by funding decisions. Federal law prohibits discriminatory funding and health policy decisions: Title VI of the Civil Rights Act prohibits discrimination by recipients of federal funding, and regulations promulgated by the U.S. Department of Health, Education, & Welfare (HHS's predecessor) make clear that this prohibits the use of criteria or methods, or even the choice of site locations that have a discriminatory effect. The regulatory agency charged with Title VI enforcement, the Office of Civil Rights, has never had the resources, information, or power necessary to uncover or prevent state discriminatory policies. States have a legal duty to comply with federal antidiscrimination law, but neither the federal government nor states have a process in place to ensure compliance. Requiring states to provide a racial impact statement of proposed changes that impact Medicaid beneficiaries -- such as changes in rate-setting, funding cuts, and elibility criteria -- would be a critical step toward meaningful enforcement of Title VI and the development of health policies that reduce, rather than foster, racial disparity.