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PRINCETON, N.J.-The largest U.S. foundation devoted to health care is seeking applicants for about $6 million in grants to support innovative projects to improve the quality and control the costs of workers compensation medical care.

The Robert Wood Johnson Foundation launched its Workers' Compensation Health Care Initiative program because of concern about workers comp medical costs, which now total $24 billion annually and have increased faster than general health care inflation rates since 1972.

The foundation is encouraged by the recently improved workers comp climate, with states legislating more managed care and insurers charging lower premiums for coverage, according to Program Director Jay S. Himmelstein, assistant chancellor for health policy at the University of Massachusetts Medical Center in Worcester, Mass. However, "the only way we can know what the best approaches are for controlling costs and improving quality is to test them," he said.

The foundation hopes to give away about seven demonstration grants averaging $250,000 over a three-year period.

Grant recipients will be programs designed to develop and implement new models for financing or delivering medical care for workers compensation beneficiaries or test new applications of successful models.

Public and private organizations are eligible to apply for grants, including insurance purchasing cooperatives, state governmental agencies and legislative commissions. An applicant must have "the leadership ability to plan and implement broad reforms in the medical component" of a state's workers comp system, the foundation says.

"Given the nature of the reforms contemplated, lead agencies also must form partnerships with other organizations," including employers, labor unions and health care providers, it added.

In addition, the foundation plans to award about 10 evaluation grants, averaging $400,000 over a four-year period. University research centers and private research firms are expected to design and implement assessments of cooperating pilot projects or other significant innovations already in operation.

Both types of projects prefer applicants that are public agencies or tax-exempt under Section 501(c)(3) of the Internal Revenue Code.

Private foundations, as defined under Section 509(a), are ineligible.

Grant funds may be used to pay project staff salaries, consultant fees, data collection and analysis, meetings, supplies and other direct expenses, including a limited amount of essential equipment.

In addition, grant recipients must agree to submit annual and final reports on their projects and findings.

The program's grants will be issued in two phases. Applications for first-phase grants are due April 1 and will be awarded in October.

An applicant workshop is scheduled for Feb. 15.

Applications for second-phase grants are due August 1997 and will be awarded March 1998. An applicant workshop is planned for April 1997.

Maine's Bureau of Insurance received a $250,000 grant from the foundation late last year under this program for a precursor demonstration project to develop 24-hour coverage pilot programs in the state.

"The bureau's 24-hour coverage pilot project will allow employers to choose a way to combine health and workers comp insurance or self-insurance," the bureau explains.

One possible choice includes an integrated benefit plan in which a single insurance policy or self-funded employee benefit plan covers both occupational and non-occupational conditions.

That particular option is available through the Maine Employers' Mutual Insurance Co. to any employer that satisfies underwriting guidelines approved by the superintendent.

Another possible choice is a coordinated plan in which common benefit administration coordinates separate policies or benefit plans.

For more information on the grants, contact the project director at 508-856-3576.