"Its success in meeting the full medical needs of an insured population of more than 300,000 persons will do far more to prevent governmental intervention in the field of medical care, so-called socialized medicine, than millions of dollars spent in propaganda."

Governmental intervention in the field of medical care will come to pass in the United States and the country will have compulsory medical insurance if the opposition of physicians continues to interfere with the growth of the only form of voluntary medical insurance that can meet the full medical needs of the people. In New York, the obstructive tactics of some local medical societies are now following the identical pattern heretofore employed by local societies to interfere with prepaid group practice in the District of Columbia, the States of Washington, Oregon, California, Oklahoma, and many other parts of the country. In spite of continued harassment, I know of no prepaid group-practice organization against which the local societies have been successful.

In spite of the extraordinary difficulties encountered during its first 5 years, there are now 31 HIP medical groups in successful operation-30 located in various sections of the 5 boroughs of New York City and 1 in the adjacent county of Nassau. Together they comprise almost 1,000 general practitioners and specialists. By July 1 they will be providing comprehensive medical care to more than 340,000 persons and before the end of 1952 the insured population will exceed 400,000.

Medical group practice. as exemplified by the organizations in CHFA, is a logical development of the present day and age. As the New York Academy of Medicine has indicated, it is the evolutionary outcome of medicine in the changing order. The comprehensive benefits of such medical group practice can be made available to families of moderate income only if the cost is shared by the enrolled persons on an insurance basis. Since medical societies cannot or will not provide the public with the opportunity to purchase comprehensive medical care in the form of prepaid group medicine, it must be established at local levels by insurance plans sponsored either by consumer organizations or by public-spirited community leaders. In the spread of this significant undertaking, the CHFA has assumed a most important public responsibility.

For many years my friend the late Fiorello H. LaGuardia, while mayor of the city of New York, began and ended each of his Sunday noon radio broadcasts to the public with the words "patience and fortitude." The good Fiorello, one of the founders of HIP, was certainly well endowed with fortitude-although he was not specially noted for his patience. Physicians engaged in prepaid group practice should adopt his slogan as their own and promise one another to carry on with patience and fortitude.

MEDICAL CARE AND THE FAMILY BUDGET

Neva R. Deardorff and Dean A. Clark, M. D.1

Better conditions for the families of the United States in the rendering of, and in the paying for, medical care require measures that reconcile three highly complex and many-sided sets of factors: (1) The wide variation in incomes and the diverse spending habits among the families of this country; (2) the nature of illness, its unpredictable character coupled with the possibilities of preven tion and control; and (3) the heterogeneous aspirations and convictions of the medical profession. There are many other angles in the total design, such as the programs, policies, and financial condition of voluntary hospitals as third parties and the part played by governmental programs and policies; but, in the main, the essence of the matter lies in the relation between persons and families who need medical care and who are expected to pay for it, on the one hand, and doctors who are competent to render it, on the other.

Families range in income from millions to nothing. They live in sparsely settled places, in towns and villages, in small cities, and in vast, densely popu lated metropolitan centers. Medical practice ranges from that of the lone outpost doctor who must try to perform every kind of needed medical service to that in highly evolved organizations made up of medical men who have special

New York Academy of Medicine.

York Commonwealth Fund, 1947.

Medicine in the Changing Order. 240 pp. New

1 Reprinted from the Social Service Review, vol. XXIII, No. 1. March 1949. Miss Deardorff is director of research and statistics, and Dr. Clark is medical director, of the Health Insurance Plan of Greater New York.

ized in a single disease, such as tuberculosis or cancer, or in the conditions of an age group, such as children or aged, or in the conditions related to work, such as industrial or aviation medicine. In view of these almost limitless ramifications of subject matter it is necessary to exercise some selection. We shall confine ourselves, therefore, to the issues presented by the problem of providing good medical care for city families of moderate means or less. Although people outside cities have much the same kinds of ailments as city people, the economics of the practice of medicine, the nature of family income and expense, and the special geographical and cultural factors in such places present issues that are distinctive. Rural communities and the larger groupings of people who are interested in them face an order of problems other than those that confront urban communities. Correspondingly, the solutions to these rural problems will have to be of an order other than the solutions that can be worked out in the cities. We shall not attempt an analysis here of the problems of medical care for rural populations. The most sweeping, brief review now available of the whole subject of medical care in the United States is the chapter on the subject in the volume published by the Twentieth Century Fund in 1947 on America's Needs and Resources.2

MEDICAL CARE AND THE CITY FAMILY

In cities families are constantly being told of the advance of medical science and its vast accomplishments both in the prevention and in the cure of disease. The resources in physicians, hospitals, and laboratories to achieve these benefits are physically present there within plain sight. But many people are under the strong impression that these wonderful boons of medical science are readily attainable only by the rich who can pay and by the poor who are willing to accept charity, administered either by institutions such as hospitals or clinics or at the hands of the private doctor. Families find this hard to take; they cherish the belief that "the American way of life" permits a wide range of choice in satisfying needs and wants, and they recognize a correlative duty to pay the price when choice is exercised. They want the right to pick out a physician who inspires their confidence, and they want to pay their way. But the problem is how to do that within their means. They must meet all their varied requirements out of a cash income that in most cases carries only a small margin beyond their "living expenses," i. e., rent, food, clothing, and transportation to and from work.

The budget necessary to provide for a family of 4 on a reasonably adquate standard of living in 34 cities in the United States in June 1947, oscillates around $58 per week for expenses other than medical care. The estimate made by the Twentieth Century Fund of the cash income distribution for families in the United States in 1950 places 69 percent of the families of 2 or more persons in the groups with less than $3,000 (i. e., about $58 per week), 21 percent with incomes between $3,000 and $5,000, and 10 percent with incomes above that amount.

Medical care under private practice and paid for when service is utilized is expensive in the sense that it bears down hard on family financing. This is so in part because illness comes irregularly, but when it does appear it often involves expense which amounts to a substantial figure. The cost of one or two home calls of a physician, a few visits at his office, a couple of days in the hospital, and a series of laboratory tests can easily equal the size of a week's wages of a relatively well-paid worker. A serious acute condition will involve still greater expense, while a chronic condition requiring repeated medical observation and elaborate treatment is something that puts a severe strain, if privately financed, even on incomes that are considerably above the lower brackets. Its cost cannot be borne at all after a very short period by people of "modest" means. Since illness in the family frequently creates not only medical but other expense and in some instances jeopardizes income itself, the more thoughtful and conscientious the family, the more apprehensive it is bound to be if there is no bulwark to protect it in time of need.

It is true that families receiving income above the level of subsistence can save to get money ahead for medical bills, but there is no assurance that illness will await a sufficient accumulation to take care of them. Moreover, it is not

Prepared by J. Frederick Dewhurst and associates, with Margaret C. Klem and Helen Hollingsworth, authors of the chapter on medical care. & America's Needs and Resources, p. 67.

reasonable to expect people to put saving for an uncertain contingency, however much it may haunt them, ahead of attending to an obvious present need, especially when they know that they cannot really plan for the emergency anyhow either in the amount which will be required or in the timing of its arrival.

But given a feasible way to make systematic and dependable provision for taking care of their needs, ordinarily prudent people will make such provision. The enormous volume of life insurance now in effect in this country is eloquent testimony of the truth of this generalization, as are the millions of homes established on "budget plans." There is every reason to believe that city families, sensitized as they are to medical care, would buy it in the right quantity and of the best quality if they could.

AMERICAN DOCTORS IN THE PRIVATE PRACTICE OF MEDICINE

Let us turn now to the doctors who must render the services of which medical care in large part consists. Medical personnel in the cities is made up, first, of physicians all of whom have invested in a costly and lengthy education, who are not only proud of medical advances but also conscious of their own need to keep abreast of them; who in varying degrees require expensive equipment (subject to rapid obsolescence) with which to establish diagnoses and to administer treatment; and who must incur considerable current expense for office help, space, automobile, drugs, and supplies. As in the case of any other profession, at one extreme there are a few men and women who love the practice of medicine so deeply that they will follow it with little, if any, regard for financial reward. At the other extreme are a few who love money so much that they will exploit every opportunity afforded by medical practice to get it. In between is the vast majority of physicians who want primarily what is necessary for them to maintain themselves and their families at a decent and respectable standard of living, to educate their children, and to provide modestly for their old age. They work hard, as a rule 6 days a week and frequently at night. They live almost constantly in an atmosphere of anxiety, with life itself often at stake. Stomach ulcers and coronary thrombosis appear among them as well as among their patients.

As members of a “learned profession" they wish to practice medicine privately, in the sense that they want no meddling supervision interposed between them and their patients. They want professional organization under their own control, and they see no reason for mixing medical politics with the other kinds. They want freedom of the profession to exercise full authority in medical matters. In recent years they have included medical economics as one of the domains over which they have thought they should exercise exclusive control. In most urban communities there are medical societies with committees on medical economics which speak for the profession, but sometimes without underlying unanimity of opinion among the doctors.

MEDICAL CHARITY A CONTROLLING ELEMENT IN MEDICAL ECONOMICS

The keystone in the arch of medical economics, both in theory as ordinarily propounded by old-line medical men and in the practice of many a younger one, is medical charity. A considerable fraction of the population of cities is dependent upon it for medical care. Since very few doctors can afford to be philanthropists, they are compelled to recoup themselves somehow. They do this by a means that is essentially a sickness tax placed upon those who, in the opinion of the physician, can afford to pay. In effect this system puts the doctor in the business of not only rendering medical care as such but also being a dispenser of aid, an assessor, and a tax collector.

In order to prevent complete chaos through competitive fees, medical societies have often fixed the minimums if any charge is to be made at all for services of various kinds; and schedules have been set for workmen's compensation cases and services for veterans. In all these instances it is evident that there has been a loading to recoup the doctor for free service, since, if a physician were fully engaged at such rates, his income could attain somewhat startling dimensions. With no relation in the case of the individual doctor between the free services actually rendered and this recoupment, the whole system is haphazard any way you look at it.

That there is need to get away from medical charity as viewed by the recipient, few would deny. Its highly unsavory character is attested by the fact that of all the modern terms casting opprobrium upon those in receipt of aid

(the term of "pauper" now being somewhat archaic) that of "charity patient" is the most humiliating. In recent decades the condition of people able to finance their shelter, food, and clothing, but not their medical care, has been described as "medical indigence," with overtones little better than those of the older term. Moreover, free medical care has often been coupled with conditions that pretty thoroughly confused its purposes and that often attracted not those interested in the health of the poor but physicians with entirely different concerns. The free patient is regularly used as teaching material if he has a condition that warrants use of him. This usually guarantees him authentic medical attention but often entails atrocious social procedures. Staff positions on hospitals with free clinic and ward patients, whether public or voluntary, are greatly coveted for their prestige values, for their opportunities to widen clinical experience, and, if it is a voluntary hospital, for the privileges they carry to use the hospital for private patients. Medical education, both initial and subsequent, is of the greatest significance and obviously should be greatly encouraged and strengthened; but it does not follow that people unable to pay for their medical care are inevitably destined forever to be the principal proving ground for medical education, study, and experiment. That honor and duty could well be shared in a democratic society by those not under economic duress. The forwardlooking teaching institutions are well aware of this and are planning their programs accordingly.

The crux of most of the difficulties in the administration of free medical care to the medically indigent lies in the fact that the producer of the service must also be the functioning philanthropist. Except for tradition there is no more reason to expect a doctor to provide free medical service than to expect a farmer to provide free food, or a clothing manufacturer free clothing, or a landlord free housing. Indigence is a matter to be established as an economic condition with basic needs supplied not as an integral part of the practice of medicine (or the operation of hospitals, for that matter) but out of funds either given voluntarily for that purpose or derived from taxation broadly assessed.

By and large, medical charity will never be other than it is so long as the relation between doctor and free patient is attended by the sharp realization on the part of both that the doctor is giving something for which he would normally be compensated. And equally bad, if not actually worse, from the broad social point of view, the fees charged private patients will continue to be "loaded" so long as doctors can point to the free work that they are expected to perform for the poor. People in the lower-income brackets who would like to pay their way cannot afford to be philanthropists, or special taxpayers either, particularly when they are sick. That is the poorest possible time to force them into that position. It is of the utmost importance that as many people as possible be enabled to pay their way medically by the removal of the "loading" and that the financing of the care of the remainder be made through community arrangements. Doctors should be freed of all responsibility for engaging personally in the equalizing of their patients' economic status. They will, of course, remain highly influential in the determination of the broad policies governing the provision of health service and medical care of those who cannot pay, but that will be in the higher echelon of community leadership and planning. The physician attending a given patient does not need to know the source of his compensation so long as it is just and fair in amount and sure to be paid.

ENABLING FAMILIES TO BUDGET MEDICAL EXPENSE

Under present conditions, medical expense is, as was said above, high when it comes and in many instances cruelly disorganizing in its effect on family planning. To many people it has meant debts to doctors; to others resort to loan companies with their heavy interest charges; to still others the rubbing out of plans for education, for home improvement, for having a child, for realizing some other long-cherished dream.

But worse still are the situations in which the family tries to avoid medical expense by delaying the visit to the physician or by the resort to self-medication or to the unqualified practitioner. The universal and long-standing testimoy on the correction, or the lack of correction, of physical defects found through the medical inspection of school children-to say nothing of the conditions brought to light through the examinations of the young men drafted for military service should have made us question far more persistently just why this neglect occurs. One can but surmise that many conscientious parents, seeing no way

to pay the regular fees of physicians, faltered before the choice of the free clinic, when there was one at hand, and the doctor who might be obtained "cheap."

What would enable a family with a limited income to buy for itself good medical care? Briefly, the answer is a budget item for prepaid medical care. A great many families now know that some order can be introduced into their financial affairs by means of a budget and that such planning helps them to get better values out of their expenditures because it forces them to give some thought to the choices that they make. They are aware of the necessity of budgeting if they are to satisfy their desires for the more expensive things. They also know that families—like other units in society, including even governmental units— can gain control over expenditure only through setting a plan that currently reconciles outgo with income. But they also know that, if left to the forces of chance, medical expense as now assessed may sooner or later wreck the family budget, especially if that budget is operating on a narrow margin. That is, it may either wreck the budget or drive the family to free care. When the need continues for any great length of time, free care is inevitable, with or without a financial debacle in the family budget. So a family budget, to be really effective, must cover medical care. But that is only possible if the necessary provision for it can be seen in advance and if the budget carries an item of adequate size for it.

Parenthetically it should be noted that family budgeting is not only a means of control by the family itself, it is also a means of revelation both to the individual and to the community. Family budgets are the real evidence of the American standard of living-that concept of well-being which means so much to us here in America and which shines like rosy dawn throughout the world. Just what is that standard in terms of medical care? Nobody can answer that precisely, either in terms of the services now being received or in terms of the dollars that do or should stand in the family budget for medical care. But we are slowly getting around to it as we shall indicate a little later. It is intended here only to point out that from every point of view it is essential to fix the size of that item so that people can plan to take care of it. The medical profession and the hospitals for whose services that money will largely be expended: the employer and the labor union, concerned about the wage expected to finance the family budget, need to know its size and the ways in which the aggregate sums in family budgets can be brought to produce for each family the care required on its day of need.

As we have said earlier, no one can predict what any given person or family may need in any given year, but we are rapidly learning what a group of families chosen at random will require. Insofar as we know that set of facts, referred to in professional circles as "utilization," as we get to a satisfactory agreement with the medical profession as to what is adequate compensation for the required amount of service, and as we can estimate properly the the allowance for administrative costs, we are pretty well set to go into the business of insuring people for the expense of their medical care. The magic of averages, as Winston Churchill phrases it, can be relied upon to determine the size of the premium that the family must pay for the assurance that, within the limitations of the whole economic system (such as inflation and widespread unemployment which destroys productive power and income), its needed medical care will have been paid for. Such are the essentials for bringing medical care within the reach of family budgets, thus enabling the largest possible number of families to pay

See The City Worker's Family Budget: General Description of Purpose and Methods Followed in Developing the Budget of 34 Cities in the Spring of 1946 and Summer of 1947, Monthly Labor Review, February 1948, prepared by Lester S. Kellogg and Dorothy S. Brady, Chief of the Prices and Cost of Living Branch and Chief of the Cost of Living Division, Bureau of Labor Statistics, U. S. Department of Labor.

"The needs for medical and dental care, as services directly related to physical health. probably will eventually be formulated in a set of actuarial standards approved by the medical and dental profession and other informed authorities. At present, the detailed and authentic statistical data necessary to the formulation of such a set of standard requirements do not exist. It is, therefore, not possible to adapt the budget determination of the medical care requirements to any set of standards corresponding to those used for food and housing.

"The medical and dental standards established in this budget are characteristic of an income level above that of the other groups of goods and services. This corresponds to the generally accepted observation that the majority of United States families have not been receiving a satisfactory volume of these essential services. There is considerable evidence that the medical care sought by families at all income levels is gradually increasing. This increase reflects both more widespread use of insurance plans, credit arrangements, and medical prepayment plans and also increased public education in the necessity of more adequate medical and dental care."