O’ConnorReport: Commitee on Costs of Medical Care: 1929 Delivery System

Committee on the Costs of Medical Care: The Delivery System and Recommendation 1

In 1929, when the Committee was formed, most physicians were in private practice, there was no health insurance and 66% of hospital beds were “government controlled.”  Medicare or Medicaid did not yet exist.  

Structure of Health Care Delivery System.  

Private Practice Physicians

In 1929, as the CCMC indicates, the dominant structure of the health care delivery system was individual physicians in private practice. “Under this system medical services are now so provided that many persons either cannot and do not receive the care they need, or are heavily burdened by its costs.  At the same time, many of the practitioners and the agencies which provide medical services are inadequately and poorly remunerated.   A barrier—in large part economic—stands between practitioners, able and eager to serve, and patients who need the services but are unwilling or unable to pay for it.”  (CCMC, op.cit.).

Of the million people working in the health care system then, almost half were physicians in private practice.  There was no private health insurance.  Public health departments existed, but were not distributed by need, but by the ability of patients to pay for services.

Now, one in six doctors is employed by hospitals.  (NPR 10-13-10).

Government Controlled Hospitals

Unlike physicians in private practice, the hospitals were largely ‘government controlled.’

In 1929, there were 7,000 hospitals for a total capacity of 1,000,000 beds.  In 1928, 63% of the hospital beds were “under government control.” By 1931, government controlled beds increased to 66% and “73% of all patient-days of services were rendered by these governmental institutions.” (CCMC pg.4).  The governments must have been city, county and state institutions.  Indeed the hospital structure then was different from now. 

Hospital Types:  1932                        Government               Other              Total

General Hospitals                            115,160                 261,311               376,471

Nervous/mental Hosp.                 413,347                 16,844                   430,191

Tuberculosis                                     50,079                  13,510                   63,589

Special                                               8,011                     17,409                  25,420

Institutional                                       20,021                       6,804                22,903

General:  Includes beds controlled by city, county, state and federal governments

Nervous: includes feeble minded and epileptic

Special:  maternity, convalescent, and rest; isolation; children’s; eye, ear, nose and throat; orthopedic; skin and cancer; drug and alcohol; chronic and incurable; trachoma; venereal; and others.

Institutional:  beds allocated between governmental and other types of control on the basis of the ration for each type in 1928.    (CCMC, pg. 5).

 Mal-distribution of Providers

 There was extensive mal-distribution of provider by geographic area.  In 1929, there was one physician for every 1,481 people in South Carolina vs. one for every 571 people in California.  There was also a stated mal-distribution of physicians.  In 1929, 45% of physicians were specialists.  “….although apparently the needs of the people could be met adequately if not more than 18% of physicians were specialists.”  (CCMC, pg. 5).

 Because the report was written before the advent of health insurance, the costs of care and access to care was directly related to income.  “The groups with smaller incomes obtain far less service. In spite of the large volume of free work done by hospitals, health departments and individual practitioners, and in spite of the sliding scale of charges, it appears that each year nearly one-half of the individuals in the lowest income group receive no professional, medical or dental attention of any kind, curative or preventive. “ (CCMC, pg 9).

 No Medical, Dental or Eye Care

 Under $1,200                     46.6%                    $3,000-$5,000                    33.4%

$1,200-$2,000                    42.2%                    $5,000–$10,000                24.4%

$2,000-$3,000                    37.3%                    $10,000 and over              13.8%  (CCMC, pg.9).

It was this lack of care that concerned the Committee.  The Committee believed that the lack of health care led to poverty through loss of a job and time away from work.

 Recommendation I

The Committee recommends that medical service, both preventive and therapeutic, should be furnished largely by organized groups of physicians, dentists, nurses, pharmacists and other associated personnel.  Such groups should be organized, preferably around a hospital, for rendering complete home, office and hospital care.  The form of organization should encourage the maintenance of high standards and the development or preservation of a personal relation between physician and patient. 10/31/1932

“The problem of providing satisfactory medical services to meet all the people of the United States at costs which they can meet is a pressing one.  At the present time, many persons do not receive service which is adequate either in quantity or quality, and the costs of the services are inequably distributed. The result is  a tremendous amount of preventable physical pain and mental anguish, needless deaths, economic inefficiencies and social waste.  Furthermore, these conditions are….unnecessary. “ (CCMC, Page 2).

“The possibility of providing medical care for all depends in part on education which is frequently a prerequisite to change. The most satisfactory solution of the problem of providing adequate scientific medical serve to every person according to his needs will be found only when the leaders of the public and the professions join hands on a basis of mutual understanding, respect and confidence.” (CCMC, op.cit.).

Comment:  Recommendation One could easily be read as “Medical Home.” 

This series of the O’ConnorReport will continue looking at what is behind the consistent failure of health care reform and the CCMC recommendations. Coming next:  Where the health care dollars go:  1929

About Kathleen

Kathleen O’Connor: 30+ year health care consumer advocate, non-profit executive and author. For more information about Kathleen, please see "About" on the main content bar above.
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