Compulsory Health Insurance, State Medicine or What?

Annual Oration 1920

By Hugh Cabot, M.D., F.A.C.S.

It has perhaps been a weakness of the medical profession that it has not sufficiently exerted its great potential influence in directing or influencing the changes in the relation of medical practice and medical custom to the community. We have on the whole been too apt to regard such things as other people's business and held the view that the care and management of the sick constituted our whole relation to the community. But it must now be perfectly clear that with the variety of suggested cures for the real or imaginary evils which are believed to surround the practice of medicine we must think clearly and act together and wisely if we are to prevent various developments which we believe to be unsuited to the requirements. Change is in the air. A demand for a closer relation between the public and its health agencies is wide-spread and proper. Democracy cannot hope to satisfy the claims of its admirers unless it can show success in protecting itself against the diseases of body and mind with which it is threatened.

The present demand for change of some kind has its source in a variety of conditions. Perhaps the most fundamental is a dissatisfaction with private charity as a method of caring for the ills of those who are unable to pay for satisfactory care. The system by which we have provided almost the best skill that the community can afford for the care of the paupers and the derelicts of society has been outgrown. The self-respecting though impecunious citizen demands and has a right to expect that he can obtain care at least equal to the average of medical knowledge without being driven into debt or bankruptcy. Undoubtedly the almost universal adoption of compensation for industrial accidents has started people thinking and they properly inquire why, if they are entitled to protection from accident chargeable against the business in which they are concerned, they are not entitled to insurance against illness chargeable to the same source. Compulsory health insurance was long ago instituted in Germany and not so long ago the so-called "panel system" of health insurance was put into effect in England. Many people and particularly those dissatisfied with present conditions have heard of these alleged panaceas and believe that they know about them though they are far more apt to hear of their excellencies than of their deficiencies. And finally the widespread demand for protection against illness is part and parcel of the general restlessness of unsettled conditions and the very human though utterly hopeless desire to get something for nothing.

Compulsory Health Insurance.

I do not intend to consume your valuable time with any lengthy dissertation on the much discussed and widely advocated system of health insurance. You are doubtless familiar with the claims made by enthusiastic advocates and most of you have come to an opinion in regard to the propriety of such an arrangement. But in order that no doubt may exist as to my own opinion I will briefly note what seem to me overwhelming objections to this system.

In the first place, as at present advocated in the various bills which are before the many state legislatures of the country, it does not, as far as I am aware, even propose to insure health or to care for the illness of the majority of the population. It is not suggested that any of the systems advocated will have any effect in the prevention of disease or in the diminution of its incidence, and yet the casual minded are rather led to believe that in some mysterious fashion such a result will accrue. It is not proposed, as far as I am aware, to apply this system to all members of the community who are or believe themselves to be financially unable to obtain satisfactory medical attention. It is proposed to apply it only to the workers in industrial concerns where it can be charged against the cost of the business and thus become a tax upon the community which may be borne without being unduly burdensome.

Furthermore, as far as I can judge from the experiments in other countries—and the experiments in England appear very enlightening for us,—the whole tendency of this method is to promote second-rate methods of practice. The fees which the physicians doing this work can be allowed to charge are of necessity low and this tends to attract chiefly physicians of average or less than average capacity. A more serious objection is that it tends to promote what may be called the method of "pill peddling" in medical practice. It tends to perpetuate the methods of one or two generations ago under which the physician made numerous visits but being unequipped with the machinery for precise diagnosis as a rule contented himself with treating symptoms and trusting to the healing powers of Nature. The last twenty years has seen a great effort to get away from this inefficient method, yet now we are asked to saddle ourselves with a system which is as sure as anything can be to restore to respectability this fast disappearing practice. As part and parcel of this same difficulty health insurance does not assume to provide and probably will in practice discourage the tendency to send patients to a hospital where they can be studied with the best results to themselves and the least expenditure of unnecessary time and exertion by the physician. For these reasons it appears to me certain to promote a method of practice unlikely to promote health or to shorten the loss of time from disease.

Another prime consideration is its effect upon the medical profession who give their lives to it. It has been sometimes argued that this and various other methods would tend to make medicine an unattractive calling. From the point of view of the medical practitioner this is a valid objection. From the point of the community, on the other hand, the medical profession can have no rights which the public is bound to respect to its own disadvantage. If it could be shown, which I think it cannot, that this or some other system would promote health, the medical profession would have no case at the bar of public opinion even though it were sacrificed to the method. But it appears to me quite clear that this method of practice will not only fail as a panacea for the health of the community but will debase the practice of medicine so that all parties will be worse off. Obviously under some system comparable to the "panel system" in England, a premium is placed upon the number of visits or calls that a given practitioner can make. From this it follows that it is clearly to his financial interest to see the least serious cases and to visit those who live in his immediate vicinity. Obviously to care for the seriously ill is likely to consume time wholly out of proportion to the fee received and sick patients and those who live at a distance are likely to suffer. It might further be suggested that this system tends to promote the sort of snap diagnosis which flourished in the earlier days of the out-patient clinics of the metropolitan hospitals when they were understaffed and overworked and from which we have been trying to escape ever since.

For these and various other reasons it seems to me clear that compulsory health insurance will inevitably work to the disadvantage of the patient, to the disadvantage of the community and to the Very grave disadvantage of the medical profession.

But clearly it will not do for us to assume a negative attitude. If we are unwise enough to sit complacently by, it is wholly probable that some system will be put in force which we believe entirely unsound. As evidence of this probability may be taken the situation in England where the organized medical profession opposed the system suggested by Mr. Lloyd George and to a considerable extent refused to assist him in working out some satisfactory method. As a result he went ahead on his own responsibility and there resulted the "panel system" which now bids fair to be most useful as a warning to the unwary.

State Medicine.

The phrase state medicine is commonly used to convey some ill-defined arrangement by which the state shall become the responsible source of medical practice. It is probably often intended to convey the idea that all physicians should become salaried officers of the state. In this form it is probably rarely used as a constructive suggestion but is intended like the Democratic Party in the days following the Civil War to serve as a threat rather than as a plan. There is, I believe, no sound reason for believing that medicine could thrive in such an atmosphere. At best such a service would be comparable to that now existing in the medical establishments of armies and navies the world over and in this form it is notorious that lack of inspiration and degeneration more or less inevitably follow.

But if we are inclined to object to it on the ground that it will injure the personnel of medicine there will not be lacking those who will oppose it upon other grounds. It is certain to be opposed by those who advocated what they pleased to call "medical freedom" and who yearly appear before our legislatures in opposition to bills proposed in the hope of improving the condition of the public health. It will also be opposed, and not without reason, by those whose business it is to determine how such a method should be financed. If these officers of the state are to be paid sufficiently large salaries to command the services of really first-class men, the bill will be little short of staggering and, coupled with the steady tendency to saddle the state with many expenses which have in the past been thought unnecessary or of private concern, will probably not commend itself to the average legislature.

In this form, therefore, I think we need not consider it in the light of a present possibility. If, on the other hand, we understand this somewhat loose phrase to mean progressive assumption on the part of the state of responsibility of health questions, such a situation now exists. More and more the state has been assuming responsibility for certain phases of medicine, chiefly in the field of preventive medicine, and enormous improvements have been made in comparatively recent times. To progress along this line there can be no valid objection and it is not inconceivable that the time may come when we shall be willing to advise the state to enter more and more into the field of curative as well as of preventive medicine.

If, construing the phrase still more widely, we understand by state medicine the assumption by communities of responsibility for the care of the sick we then approach a phase of the question which is inviting and one in which there is much evidence that activity looking toward definite change is widespread.

We rightly believe that our knowledge of the complicated business of looking after the sick entitles us to be heard. I believe there is no reasonable doubt that we shall be heard if we have a constructive plan and equally little doubt that if we should unwisely confine our efforts to obstruction that we shall receive, if possible, less consideration than we deserve. It is therefore with the hope of stimulating discussion and thought rather than with any overweening confidence that I have a wholly satisfactory plan to propose that I desire to invite your attention to a possible line of development which appears to me at least worth considering.

Essentials of a Satisfactory Method of Providing Medical Care of Good Grade for Everyone.

Whatever method we adopt must aim to insure to every member of the community satisfactory medical treatment without requiring him to accept charity or go into debt. It must allow a reasonable freedom of choice or if choice is to be restricted must guarantee a high grade of medical skill. It must reasonably distribute the cost so that it shall not be unnecessarily burdensome and finally it must not interfere with the proper development of the science and art of medicine. We might, perhaps, lay more stress upon this latter point and insist that any system to be satisfactory must show evidence of actually promoting the development of medicine.

In attempting to suggest a method of improving present conditions it is only proper to recognize that various experiments are being tried and with varying though considerable degrees of success.

Industrial Medicine.

This phrase is often loosely used to cover the medical establishments which have been set up by employees for the purpose of caring for their employees. For many years these establishments have been growing and have now been carried to a high degree of efficiency. There can be no manner of doubt that many of the great industrial incorporations now provide for their employees an amount of medical care which closely approaches the ideal. They have wisely provided well trained physicians properly paid and organized their work on a system or variety of systems which would go far to solve the problem if it were satisfactory to what one might call the insured. But it is commonly true that the employees for one reason or another dislike this method. It is alleged that they suspect the evidence of paternalism. It is alleged that they object to this limitation of their freedom of choice and it is alleged that the corporations use the method to their own advantage. Though these allegations may appear shadowy and unsubstantial, there is probably some basis for the widespread belief that the problem will not be solved in this way. To my mind the greatest objection to this method is that it is a solution carried out privately but charged against the community in the heightened cost of production and yet the community has no voice or control in its management. On the other hand, there is no doubt that these establishments have served and are serving a very useful purpose. For the time being, at least, they give time for the orderly discussion and consideration of the problem and they provide an immense amount of what one might call experimental evidence on the methods of managing industrial accidents, diseases and conditions arising within industry. Whatever method may be finally adopted we shall owe a considerable debt to these pioneers in this method of caring for the sick upon a large scale.

Group Medicine.

The phrase "group medicine" has of late years come into vogue to cover what almost amounts to partnerships between the specialties of medicine. These groups are a serious attempt to solve the problem which we are discussing and have undoubtedly promoted efficiency in the diagnosis and treatment of disease. The chief objection to regarding them as the best method of solving the problem is that they are only incidentally constructed for the benefit of the patient. This benefit consists more largely in increased efficiency than in decreased expense. It is certainly true that in many of these medical groups the financial benefit of the group rather than of the patient has been the commanding consideration.

The Community Health Center.

By whatever method we may finally decide to care for the health of the community, the fundamental proposition upon which it is based must be that the public health is a public concern. From this it follows that the soundest method will be that which is based upon community consciousness. For this reason I look to some development in the now rather vague field covered by the phrase community center for the solution of the problem.

A great variety of possible developments may be here included. In its simplest form a community may provide itself with a Director of Health whose business it shall be to coordinate existing agencies, encourage cooperation, discourage duplication, and promote efficiency. In this form it is already in operation in various parts of the country. But it may be doubted whether without more means at his disposal such a director will obtain results at all commensurate with the effort expended. A slight advancement from this plan is to provide such a director with a staff of physicians whose business it shall be to keep in touch with the medical activities of the community and go further than he himself could go along the line of influencing medical practice by suggestion and publicity. But again, this arrangement falls short of providing sufficient power and does not enable the director and his staff to exert the authority of public opinion which must at the last analysis always be the ultimate authority.

One of the clearest signs of the times is the tendency of medical practice to group itself about hospitals, and there can be no doubt that in the future of medicine the hospital will play an increasingly important part. For this reason it has appeared to me wisest in any scheme looking to the provision of care for all members of the community to start with the hospital as a basis and create what might be called the hospital center, whose function it should be not only to provide care within its wards but to radiate medicine in the community at large. This possibility appears to me attractive, but to be successful it must have a far broader conception than the municipal hospitals with which we are all familiar. It must take its authority from an educated public opinion which knows, broadly speaking what it wants and is prepared to employ experts to obtain it. Undoubtedly such a method can be worked out most easily in comparatively small communities where there is a small city and a large area of surrounding country ultimately dependent upon the city for medical service. Under such conditions one might well conceive that, some such machinery as the following would work with considerable satisfaction.

The Hospital. Such a community might construct and own a hospital with sufficient capacity to take care of something more than the average number sick not only in the city but in the surrounding district which it must serve. It is perhaps not necessary that this should be calculated to provide accommodations for those who ordinarily avail themselves of private physicians and private hospitals. But, on the other hand, if such a hospital is to be in fact a health center, it should be constructed so as to provide everything which that community wants for the care of its bodily ills. Obviously in communities of large population, it may be wise to construct several such hospitals, as there is undoubtedly a working unit in hospital construction beyond which efficiency of operation is sacrificed. But for the moment let us assume that a hospital of no gigantic dimensions will fill the bill and let us further assume that it is planned to provide accommodations for all sorts and conditions of men.

The Board. In charge of this hospital must be a group, perhaps called a board, who properly represent the wishes of the community, and I believe that this board should serve without pay, so that the only motive for service on the board will be an abiding desire to serve the community. This board must provide itself with a general manager who must, I believe, be a physician, in order that he may be reasonably familiar with the problems with which the board must deal. Such general manager or director must have large powers in executing the policy of the board.

The Staff. The board must next provide itself with a staff capable of covering the entire field of medicine and medical research and this staff must be at the service of the community. The problems involved in the selection of such a staff are obviously considerable, particularly if such a hospital is to be started in a community already supplied with a sufficient number though perhaps not a sufficient variety of capable physicians. Clearly this staff must be of more than average skill and equally clearly their skill and qualifications must be beyond reasonable doubt and therefore must be determined by some authority having no interest beyond the determination of the facts. In order to avoid difficulties the board would probably be well advised to avail itself of the advice of the directors of great medical centers who are constantly engaged in the training of experts in every field of medicine. In order to obtain and retain the services of such a staff, proper salaries must be paid and it may well appear that the provision of such a sum of money will bear heavily upon the community. This difficulty may, I think, in part be solved by allowing this staff to practice in the ordinary sense of the word and to collect fees from such patients as are able to pay. As the staff, when under this arrangement, would consist of well trained, capable specialists, it would certainly follow that their services would be in considerable demand in the community and that their income from this source would go far to make up the guaranteed salaries which they would be assured of by the board. From this it would result that the community through the board would pay only the balances and might conceivably not have to pay at all.

The Patients. Some difficulty will undoubtedly arise in determining what patients are entitled to free care and treatment, what patients should be partly free and what patients can defray their own financial obligations. This difficulty, however, is at least much diminished if we assume that this is in fact a community hospital. It is not difficult if proper machinery be provided to ascertain what are the living conditions of any individual and what is his income relative to his obligations. It we cannot assume that the community really wants to promote its own health and is willing to take any reasonable steps in order to do so, then of course this method will fail, but so will any other method, and on this line of argument the whole proposition becomes insoluble.

Open Versus Closed Hospitals.

The medical profession will of course be vitally interested in the question of whether this community hospital is to be what is called "open" or "closed." It is, I think, generally admitted that if one has regard only for a high grade of efficient medical practice the closed hospital is likely to give the best results. On the other hand, it is practically a contradiction of terms to refer to a closed hospital as a community hospital. A closed hospital at once denies the freedom of choice which is generally admitted as essential if it is to command the confidence and support of the community. Physicians who are barred, though in good standing, will obviously not send their patients to a closed hospital unless they be compelled to by fear of disaster either to the patient or to themselves. It cannot, I think, be successfully contended that a closed hospital can satisfactorily serve the whole community and therefore some sacrifice of efficiency is necessary in the interest of the community operation. The answer to this dilemma perhaps lies in a combination of the two methods. The staff provided by the community must obviously look after those patients who are unable to pay and also such other patients as desire their services. Beyond this, the hospital might well be opened to all reputable physicians with the proviso that the board shall have the power to exclude any physician whose work does not match up to a reasonable standard of excellence.

But such a hospital will not have performed its functions if it stops here. It is growing more and more difficult to provide satisfactory medical care for the small villages and the scattered populations of the outlying districts. I am firmly of the opinion that provision for such care is entirely within the function of the community hospital and that unless it serves this purpose it will fail to radiate medicine and consequently fail of its purpose. The work now done by isolated physicians attempting to cover a large area of territory could well be taken over by the hospital, whose business it would be to establish throughout the surrounding country small centers provided with a young physician and one or more nurses. These people would be constantly in touch with the, hospital staff, thus obtaining advice, consultation, and comfort. While they should be integral parts of the hospital staff they should be movable rather than fixed and this service should be regarded as a part of the training of the younger men who intend to fit themselves for the practice of medicine in its broadest sense. This line of development seems to me particularly interesting and attractive. It would enable such a community hospital to offer a variety of opportunities, particularly to younger medical men whose capacities are unknown and who might in this way, better than in any other, have an opportunity to survey the broad field of medical practice. The same proposition would hold true as regards the nurses associated with these smaller centers. They would see medicine in its relation to people as is not now possible in the hospital training schools. As a result they would not only be better equipped for whatever branch of nursing practice they ultimately espoused but they would have larger opportunities of surveying the field and thereby learning their own capacity.

I submit this rough sketch of possible medical development for your consideration. It is obviously incomplete, open to objection and its pathway spread with thorns. I hope that you will find in it the merit of a conscientious attempt at a constructive program based upon the assumption that the community really desires to have its health properly supervised and its illness properly treated. Any scheme which we propose is subject to this consideration, and though it may fairly be doubted whether the community conscientiousness is throughout the country sufficiently developed and crystallized to know its own wants, it is possible that in various places such experiments may be tried and may prove helpful to a final solution.

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Cabot, Hugh. "Compulsory Health Insurance, State Medicine or What?” The Boston Medical and Surgical Journal 182, no. 24 (1920): 595-601.


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