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Home , 1960s, February 1965

Health Care in the Early

Rosemary A. Stevens, Ph.D.

My topic, health care in the early 1960s, comment from a visiting delegation from has a double set of meanings for me. I am a Britain in 1960 were complete air condi- historian, and the 1960s are now "history," tioning and artificial lighting systems, ad- ripe for new interpretations. Yet I was also justable electric beds, carpets in private an immigrant to the in 1961, rooms, pass-through refrigerators in the fresh from working as an administrator in kitchen, central milk kitchens, central ster- the British National Health Service. The ile supply services, automatic X-ray proces- period immediately before the sors, autoanalyzers in the laboratory, plas- legislation in 1965 shines in my memory tic bags for blood, identification bracelets with the vividness of new impressions: for patients, pneumatic tube systems for those of a young health care student trying communications and, not least, massive to make sense of the U. S. health care sys- power plants (Hurst, 1960). In the United tem, and indeed, of the United States. States, the hospital was readily compared The health care system and the United with industrial corporations. States as a stand, in many ways, as Yet the gaps and variations in both rheto- proxy for each other, now as then: The ric and service were extraordinary. To the whole tells you much about the part, and new migrant, the vast cross-continental the part about the whole. In the early network of superhighways appeared to 1960s, health care was already a massive connect cities-indeed swept through, enterprise. By the late , hospitals em- around, or over them-without stopping to ployed far more people than the steel in- recognize their problems, character, or dif- dustry, the automobile industry, and inter- ferences. Similarly, in both the larger soci- state railroads. One of every eight ety and the smaller domain of health serv- Americans was admitted annually as an in- ices, there were searches for a unifying patient (Somers and Somers, 1961). To common purpose, overlying conflicts and study health care, with all its contradictions ambiguities. Great leaders defined heroic, and complexities, in the 1960s as in the rallying causes: John F Kennedy, Lyndon present, is to explore the character and am- Baines Johnson, Martin Luther King, Jr. biguities of the United States itself, that Yet the structure and financing of the vast, brash, divided yet curiously hopeful health system made little intuitive sense. Nation. More than 70 percent of the population had On the face of it, the United States was a some form of hospital insurance by 1965 country blessed by plenty in the 1960s, (though less than one-half of the elderly with hospitals and professionals that were population did), 67 percent had surgical in- the envy of the world. Among the marvels surance, and there was a growing market of modern hospitals that provoked for major medical insurance (Health Insur- ance Institute, 1980). But few were insured Rosemary A. Stevens is Professor of History and Sociology of Science at the University of Pennsylvania. The opinions ex- for primary or out-of-hospital care. Of the pressed are those of the author and do not necessarily reflect members of the general population who re- those of the University of Pennsylvania or the Health Care Financing Administration. ported they had "pains in the heart," 25

HEALTH CARE FINANCING REVIEW/ Winter 1996/Volume 18, Number 2 11 percent did not see a physician (Andersen for the potentially catastrophic burdens of and Anderson, 1967). hospital and doctors' bills. The elderly were particularly hard hit. Government programs were segmented The classic example of the proposed Medi- into programs designed for apparently "de- care beneficiary was the elderly school- serving" Americans, notably veterans and teacher, blameless after a career of work. "I Federal employees, and for different cat- am one of your old retired teachers that egories of the poor, State by State, who has been forgotten," went one story in con- were by definition "less deserving." Social gressional hearings in 1959: class, like race, was a topic to which many health practitioners had as yet given little I am 80 years old and for 10 years I thought, although the topic had important have been living on a bare nothing, ramifications, both for clinical practice and two meals a day, one egg, a soup, be- for national politics. As one contemporary cause I want to be independent. doctor pointed out, "lower-class" patients I am of Scotch ancestry, my father were often dissatisfied with their medical fought in the to the end of care and "many of them would prefer gov- the war, therefore, I have it in my ernment medicine" (Storrow, 1963). They blood to be independent and my dig- were also, he wrote, easily angered, per- nity would not let me go down and be haps "physically aggressive when aroused," on welfare. expected frustration from those in author- And I worked so hard that I have per- ity, and tended to behave in unexpected nicious anemia, $9.95 for a little bottle ways. But for the poor, the impersonality of liquid for shots, wholesale, I couldn't and rudeness of large hospitals were often pay for it (Subcommittee on Problems deterring factors in seeking care at all. The of the Aged and Aging of the Commit- rift between doctor and patient was evi- tee of Labor and Public Welfare, 1959; dent, and nineteenth century attitudes Corning, 1969). toward poverty lingered among the more affluent in general. At least one-third of the Members of the initial Medicare popula- population said, when polled in 1963, that tion, born in the late nineteenth century, an individual was personally responsible had survived two world wars, a major eco- for his or her own poverty (Schiltz, 1970). nomic depression, and enormous changes By 1960 though, there were notable shifts in the organization of work, mass produc- toward medical care for those of retire- tion, rapid urbanization, and modern com- ment age. Recognizing the special eco- munications. As beneficiaries of the 1935 nomic needs of the elderly, the Kerr-Mills Social Security legislation, they were mem- Act of 1960 established a new category of bers of a culture of entitlement. By 1964, 83 "medical indigence" for beneficiaries of percent of the population 65 years of age or Federal grants to the States for the elderly. over were eligible for Social Security ben- Legislation for mental health in 1963 tar- efits; and there were almost three times as geted another previously stigmatized many aged Social Security beneficiaries group-a major step toward de-institution- as there were 10 years earlier.' Yet before alizing the mentally ill. The health system Medicare there were no entitlements seemed full of exceptions, exclusions, and contradictions, while national leaders Not all those who were eligible for benefits received them; the comparable figures were 63 percent in 1960 and 74 percent in stressed high-sounding, unifying social 1964 (U.S. Department of Health, Education, and Welfare, 1965). principles.

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John Kenneth Galbraith (1958) had filled with contrasts. The flight of relatively come up with one apparently unifying argu- young, affluent, middle-class families to ment when he labeled the United States new suburbs created inner cities with dis- "The Affluent Society." In theory, Ameri- proportionate numbers of elderly and mi- cans were now all "middle-class consum- nority Americans. The stage was set for ers," with standard expectations. Televi- summers of racial , urban decay, sion, the new vehicle of mass culture, and declining tax revenues for city schools, celebrated modern medicine as part of a hospitals, and social services. In cities such culture of consumerism. All three of the as Newark, New Jersey, and Washington, major television networks carried hospital DC, African-Americans represented a ma- dramas in the early 1960s, centering jority of the population by the early 1960s. Americans in the fictional worlds of Doctor Physicians migrated to the suburbs with Kildare (NBC), Ben Casey (ABC), and the other white-collar workers, leaving the hos- Nurses (CBS). The main issues for health pital emergency room as a primary source policy in this context were to define needy of care for many urban dwellers. Emer- groups as middle-class and to ensure that gency department visits increased by 16 they could behave like middle-class con- million, or 175 percent, between 1954 and sumers by having the means to do so, that 1964, and the quality of care was often is, by having adequate hospital insurance tenuous. Among the complaints: Physi- coverage, backed up where necessary by cians were overworked; they were reluc- public assistance. tant to take on weekend and evening duty; Yet, as sociologist Michael Harrington and as suburbanites beset by worsening (1962) demonstrated eloquently in his own traffic conditions, they could not respond best-seller in 1962, the highest mass stan- promptly to emergency calls (Silver, 1966). dard of living in the world was definitely Wider social rifts permeated the struc- not shared by all. There was "another ture of health care and its institutions. America": 40 to 50 million citizens who These too were often socially "invisible"; were poor, who lacked adequate medical that is, taken for granted and commented care, and who were "socially invisible" to on rarely until the late 1950s. Herbert the majority of the population. Within this Klarman (1962) did a study of hospital pa- poverty-stricken group were more than 8 tients in 1957 that described the rigid pat- million of the 18 million Americans who tern of stratification and segregation by were 65 years of age and over, suffering class and race in New York City. In New from a "downward spiral" of sickness and York's for-profit hospitals and in the private isolation. And although there were half a and semi-private accommodations of not- million Americans in nursing homes, less for-profit hospitals, patients designated than 60 percent of the homes were consid- "white" were virtually the only patients (97 ered acceptable (Harrington, 1962). Medi- percent and 96 percent, respectively). The care was formed in a society with idealistic wards of not-for-profit hospitals provided expectations of wealth for all-at least for accommodations for poorer (or uninsured) all of those who "deserved" it yet increas- members of society; here the proportion of ingly isolated its minorities and its poor. white people was lower (66 percent). But in There were evident rifts in American so- the municipal hospitals, the backbone of ciety in the early 1960s, by race, age, class, welfare medical care, the great majority of and gender. Demographic changes after patients were Puerto Rican, African-Ameri- World War II had created communities can, and members of races other than

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white (Klarman, 1962). In the South, there Yet it was also narrowly conceived and de- was formal , although mographically selective, in that it singled this was beginning to be challenged effec- out the elderly (and later the disabled and tively. "Disease and Death Know No Race" those with end stage renal disease) as a proclaimed the signs carried by protesters distinct and privileged population group. In at the Grady Hospital in Atlanta in 1962, short-and not surprisingly-Medicare re- where a group of African-Americans had flected wider social ambiguities in U.S. atti- taken over the lounge of the "whites-only" tudes to national unity, social class, and outpatient clinic (Newsweek, 1962). equal opportunity. The contrast between wish and reality If one defining theme for the years be- (the wish for a truly and the fore Medicare was the nature and concept reality of conflict and division) forms an es- of social entitlement, a second defining sential first theme for understanding the theme was the clear appreciation by the years before Medicare. In effect, Medicare early 1960s that modern scientific medi- was to be a means of transforming the eld- cine had brought serious technical, organi- erly into paying consumers of hospital zational, and financial problems in its wake. services. , with its continuing wel- Anne and Herman Somers (1961), in an in- fare stigma, was to cover those who were fluential book published in 1961, high- "indigent." Legislative proposals from the lighted the confusion that distinguished first Forand bill in 1957, through the the health care system (and its portrayal in Kennedy-Anderson proposals, to the sign- the press) in the early 1960s: "On the one ing of the Medicare legislation in , hand, attention is called to increasing evi- stressed the inability of the private market dence of astounding progress: the discov- to meet the needs of older, retired Ameri- ery and application of cures, drugs and cans who could not afford medical care techniques, which can only be described when they were sick, rather than the needs as `miracles.' On the other hand, there are of all Americans who were uninsured. As a constant allegations of inadequate medical group, the elderly were significantly poorer care, of unfilled health needs among the than the working population, their medical American people, and apparently wide- needs were much greater, and insurance spread discontent with various medical in- coverage, where it did exist, included only stitutions" (Somers and Somers, 1961). a minority of total health care costs.' Nev- Among these institutions were the profes- ertheless, the elderly represented only a sional associations, insurance plans, and minority of all who were poor. hospitals. Medicare was thus to add to the para- Historian John Burnham (1982) has doxical nature of insurance coverage. It was aptly called the period from the beginning designed as socially unifying legislation in of the up to the late 1950s that it embraced all social classes on equal "American medicine's golden age." The terms within one age group, in effect accept- conquest of infectious diseases seemed ing them all as middle-class consumers. near completion, and the promise of medi- cal science continued to be compelling. An- 2 Across the population as a whole, insurance covered 33 per- cent of private consumer expenditures by 1964, up from 12 per- tibiotics had drastically reduced the dan- cent in 1950, skewed toward hospital care and surgical services. gers of pneumonia and other infectious Of surgically treated patients 65 years of age or over who were discharged from short-stay hospitals in 1963-64, 55 percent of diseases. By 1964 the United States was the surgeon's bill was paid partly or entirely by insurance (U.S. Bureau of the Census, 1966). producing $86 million worth of penicillin,

1 4 HEALTH CARE FINANCING REVIEW/ Winter 1996/Volume 18, Number 2 more than $7 million worth of streptomy- national health insurance. In essence, this cin, and almost $7 million worth of the was what Medicare was to do. Assuming sulfa drugs. Tranquilizers were in wide- the possibilities of cure in its acute, hospi- spread use; the sale of tranquilizers almost tal-oriented focus, Medicare ratified the doubled between 1960 and 1964, from $4 social value of curative medicine over the million to almost $8 million. There was con- more tenuous possibilities of palliation and cern about their overuse (U.S. Bureau of prevention. But there were other, more im- the Census, 1966). Even for apparently in- mediate reasons why Medicare was de- tractable conditions, medical science held signed to be responsive to the technologi- out considerable hope for cure. For ex- cal and high-cost side of medicine rather ample, it was estimated in the early 1960s than to chronic illness. Paramount con- that about one-third of cancer patients cerns in the early 1960s were the financial were free of disease 5 years after diagnosis, needs of the expanding hospital system, and it was thought that the percentage and the pocketbook needs of the retired could be raised to one-half (Somers and population. The debates that led up to Somers, 1961). Even mental illness seemed Medicare focused almost entirely on pro- increasingly susceptible to treatment, for viding income to hospitals and on easing by the early 1960s, an array of mental ill- the burdens (or lack) of hospital insurance nesses was being treated by the new for the elderly, especially for the Blue psychotropic drugs. Cross plans, which were seriously It was quite possible in the early 1960s to concerned about coverage of this group. anticipate the changing focus in epidemiol- Many of the changes in clinical medicine ogy from acute to chronic disease that we by the early 1960s were the result of phar- are grappling with today. However, from maceuticals: the antibiotics, psychotropics, the perspective of the 1960s, the advantage tranquilizers, hormones, and other drugs. of conceiving of chronic diseases as treat- It was estimated that 90 percent of the able along the same lines as acute condi- drugs prescribed in 1960 had been intro- tions meant that the U.S. system of health duced in the previous two , and services and health insurance (premised, that 40 percent of the prescriptions could as it was, on cure rather than on care of not have been filled in 1954 (Somers and long-term, continuing sickness) need not Somers, 1961). Americans' enthusiasm for be tampered with to fit the changing pat- producing and ingesting drugs was a terns of disease. Put a different way, if marked feature of American medicine, heart disease, cancer, and stroke could be compared with other countries. Drugs and "fixed," then the aggressive style of Ameri- other medical non-durables represented 20 can medicine-science-based, disease-fo- percent of all private expenditures for health cused, technological, and interventionist- care in the United States in 1960, almost all might be justified as a primary basis for spent out-of-pocket-that is, without insur- national health policy in the future, as it ance coverage. 3 A writer in the periodical had, successfully, in earlier decades without Saturday Review stated a common belief of radical changes in the system. Further, the the early 1960s (and since) that the United United States would be well advised to States was the most overmedicated invest in biomedical research and ensure population access to hospital and specialist ' In 1990, in contrast, expenditures for drugs and other medical non-durables represented 14 percent of all private national care, rather than worry about primary care, health expenditures and 9 percent of total (private and govern- long-term services, and comprehensive mental) health expenditures (Levit et al., 1994).

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country in the world (Ratner, 1962). 4 How- attacks were then dying, not much differ- ever, drugs (which were largely ignored in ent from a generation earlier (Newsweek, Medicare) were relatively inexpensive, 1965). The growth of highly competent compared with the rapid development of emergency medical technicians, trauma hospital-based medicine. "With ingenious specialists, and emergency networks was substitutes for human organs and bold ex- largely in the future. Nevertheless, the periments in transplants," proclaimed Life promises of medical electronics in particu- magazine, "man becomes a master me- lar and bioengineering in general were chanic-on himself' (Life, 1965). Kidney clearly evident by the mid-1960s. transplants were being performed by 1965, Except for the smallest hospitals, the in- raising difficult questions of the harvesting tensive care unit was commonplace by the and allocation of organs. So strong was the mid-1960s. Coronary care units were ap- curative logic of renal dialysis and renal pearing, and there were premature nurser- transplantation that Medicare was to be ies, special respiratory units, and in the modified in 1972 to include them in a sepa- larger hospitals, units dealing with postop- rate, yet extraordinary, new category of erative care after open-heart surgery and benefits, to be made available to beneficiaries neurosurgery (Russell, 1979; Stevens, of all ages. 1989). A writer in The New Republic wrote But the most dramatic medical technolo- in 1963: "Today's hospital and yesterday's gies focused on the heart. Reconstruction hospitals are both called hospitals, but oth- or total replacement of the aortic valve and erwise the resemblance is coincidental ongoing experiments in heart surgery (The New Republic, 1963)." The increasing might, proclaimed the popular press, even- intensity of hospital service was repre- tually lead to heart transplants (Business sented in steadily increasing staffing lev- Week, 1961). Emergency care of heart at- els. The number of hospital personnel tack patients was also receiving consider- doubled between 1950 and 1964; in the lat- able attention. "Reversing death is perhaps ter year, there were 2.4 staff members per the boldest feat of modern medicine," patient, for an average hospital stay of ap- wrote one enthusiast in the Saturday proximately 9 days-more than 2 weeks Evening Post in 1961; once again, the goal for those 65 years of age or over (U.S. Bu- was cure by intervention (Severino, 1961). reau of the Census, 1966). Death, as well as Restarting the heart after the cease of birth, typically occurred in a hospital; the heartbeat altogether or correcting for fi- great killers were heart disease, cancer, brillation through electrical stimulation- and stroke, accounting for well over two- commonplace emergency procedures to- thirds of all deaths in the mid-1960s (U.S. day-were exciting prospects in the early Bureau of the Census, 1966). 1960s. Events such as the opening of a spe- The messages of technological optimism cialized cardiac center at the Peter Bent that had distinguished American hospitals Brigham Hospital in in 1965 were since the had focused on the rela- heralded in the national press. Reportedly, tively young and the acutely sick. The eld- 30 percent of individuals suffering heart erly, although represented to an increasing extent (an increasingly costly extent) in ° Ratner was quoted by Seymour E. Harris (1964) in a book that provides a good overview of the issues addressed in the well- hospitals, were a minority of hospital pa- publicized committee hearings under the chairmanship of Sena- tients in 1965: Almost 70 percent of all pa- tor Estes Kefauver, which paid special attention to the large profits generated by the major drug companies in the late 1950s tients treated in short-stay hospitals were and early 1960s. Regulation of drugs was also an important is- sue, highlighted by the dispute over thalidomide in 1962. under 65 years of age (Stevens, 1989).

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Even though the needs of the elderly were limitation were heart conditions, arthritis, far greater than those of younger members and rheumatism (U.S. Department of of the population, the elderly were far less Health, Education, and Welfare, 1965).6 As likely to carry insurance, and their num- chronic diseases overtook acute illness as bers were rising steadily. Although there a focus of everyday experience, the need were still more children under 5 years of for hospital insurance became only one of age than there were individuals 65 years of many potentially expensive costs for the age or over in 1965, the latter group was care of the chronically ill, including home growing fast while the birth rate was de- care, nursing homes, and social, rehabilita- clining rapidly. Moreover, a majority of the tive, and psychological support services. more than 18 million Americans 65 years of To some extent Medicare can be seen as age or over were women, whose life ex- the response to the golden age of curative pectancy exceeded that of men (U.S. Bu- medicine, just as that age was passing from reau of the Census, 1966). The terms the scene. By the early 1960s, acute medi- "young-old" and "old-old" had not yet come cal interventions in the face of chronic dis- into currency, but for Americans who ease and death, although 'becoming com- reached the age of 65, the prospects of an monplace, were questioned in the popular extended retirement were good: The aver- press. The hospital, seat of medical tech- age expectation of life at the age of 65 was nology, was no longer isolated from ques- 80, with women surviving in greater num- tion and criticism. "Is your hospital safe?" bers than men. Lack of acceptable nursing asked the journal Good Housekeeping in home beds was becoming a serious prob- 1961, citing deficiencies uncovered by the lem as a greater proportion of the popula- Joint Commission on Accreditation of Hos- tion survived into old age. Expenditures pitals. Each year, claimed the journal, for nursing homes were rising rapidly, "thousands of people go to hospitals where stimulated by the Federal-State Kerr- their lives are endangered by bad doctor- Mills program, which extended medical ing, unsanitary conditions or grim fire haz- assistance to the aged.' ards. Or by a combination of the three" In the early 1960s, the choices for unin- (Robinson, 1961). Surgery was a major fo- sured or underinsured elderly patients cus of hospitals in the 1960s, accounting for needing hospital service were to spend more than one-third of all short-stay hospi- their savings, rely on funding from their tal admissions, yet less than one-half of all children, seek welfare (and the social surgery was performed by board-certified stigma this carried), hope for charity from specialists (Andersen and Anderson, the hospitals, or avoid care altogether. In 1967). "Is this operation necessary?" asked parallel to the growing financial problem of The New Republic (Lembke, 1963). "Should hospital service for the elderly, though, the doctors tell the truth to cancer patients?" changing pattern of morbidity, away from asked the Ladies Home Journal (1961). acute episodes toward chronic diseases, "What is the patient really trying to say?" was shifting attention to those with multiple asked Time (1964) magazine, on the need conditions and long-term needs. By the to improve doctor-patient communication. early 1960s, the major causes for activity Specialists were reportedly less popular 5 than general practitioners, but there was Expenditures for nursing homes represented 30 percent of widespread concern about lack of time payments to providers under public assistance in 1964. For the program of Medical Assistance for the Aged, more was being spent on long-term care than hospitalization (U.S. Department 6 For a good discussion of Federal policy in the face of the shift of Health, Education, and Welfare, 1965). toward chronic conditions, see (Fox, 1993).

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spent in the clinical encounter, and popular term care. Nor was it generally appreciated support of ongoing efforts to increase the in the 1960s how compelling the influence national supply of physicians (Carter, 1961). of insurance and other money flows would These concerns were joined by criti- be (and was, to some extent) as the primary cisms of widely varying standards of care: driver of the U. S. health care system. between hospitals; between cities and their The second possible vehicle for reorga- suburbs, as the younger population mi- nization was communitywide planning, grated out of center-city, leaving the older regulation, and priority-setting by govern- and poorer population behind; and be- ment or quasi-government agencies. How- tween broader geographical areas includ- ever, here the idiosyncratic structure of the ing States. But equally, at a time of acute U.S. hospital system militated against de- concern about hospital costs, there seemed centralized planning efforts that, summed no case for unnecessary duplication of together, would create a common pattern technology and facilities. of services across the Nation. Hospitals There were two possible models for re- were organized neither into a competitive organization of health care in the 1960s profit oriented market, which might have into a system that might more nearly meet achieved efficiencies through mergers and the needs of changing morbidity on the acquisitions, nor into a governmental sys- one hand and the efficient deployment of tem, which might have planned by fiat. expensive technology on the other. Unfor- Most hospitals were small, locally oriented tunately, neither was generally available. institutions in the early 1960s; 3 out of 5 The first model would have been to de- general hospitals had fewer than 100 beds. velop self-contained service systems, that The traditional American "voluntary" or is, encourage the development of what we community hospital was a not-for-profit or- now call health maintenance organizations ganization. Private support of local hospi- (HMOs) or managed care systems. How- tals upheld, at least traditionally, the more ever, even in the late 1960s, only 2 percent general goals of social stability, community of the entire population were covered building, and charity-giving in the broadest through prepaid group practice (renamed sense. Through the 1950s and into the HMOs in 1970) (Stevens, 1971). A repre- 1960s, voluntary (not-for-profit) hospitals sentative from the Kaiser Foundation consistently reported 70 percent of all Health Plan, Clifford H. Keene, argued short-term general hospital admissions, during the Medicare hearings that Medi- more than 70 percent of hospital expenses care would disadvantage the fledgling and personnel, and 75 percent of hospital HMO movement by encouraging greater assets. Of the 1.4 million employees in use of hospitals and nursing homes, and short-term hospitals in 1965, 1 million greater reliance on them than on other ap- worked in the voluntary sector. Another proaches to care. He was correct (Commit- million adults and teenagers worked as tee on Ways and Means, 1965). But it was hospital volunteers, reinforcing allegiance difficult in the early 1960s to conceive of re- to a specific community institution forming the U.S. health care system in any (Stevens, 1989). Hospitals represented a model that was not based on hospitals, for patchwork of virtually autonomous institu- this was a hospital-dominated system. tions, each with its own agenda and com- There was not a strong primary care base munities of interest. This was not a promis- on which to build comprehensive services ing setting for organizational consolidation that would include both acute and long- and priority-setting, let alone for the

1 8 HEALTH CARE FINANCING REVIEW/ Winter 1996/Volume 18, Number 2 development of comprehensive health Conceived as a solution to protecting the services for the elderly (or others), geared pocketbooks of the elderly, Medicare was to chronic disease and disability. not designed to address the wider issues of Federal policy, from 1945 through the universal insurance coverage, chronic ill- implementation of Medicare, served, ness, health care costs, and organization. moreover, to reinforce this system. The In some ways, indeed, the passage of Medi- most visible Federal grant programs were care was based on avoidance of these is- the Hill-Burton hospital construction pro- sues. With relatively focused goals and gram and funding for biomedical science strong supporters, Medicare offered equal- through the National Institutes of Health. ity of economic opportunity for the elderly Legislation for university-based regional in the insurance market for hospital and medical planning for heart disease, cancer, specialist services. It was to succeed, first, and stroke in 1965 (Public Law 89-239),' by being based on prevailing structures of and for State and areawide "comprehen- private hospital and medical insurance and sive health planning" in 1966 (Public Law second, by being incorporated as an 89-649), 8 were half-hearted, without teeth. entitlement into the Social Security system. These proposals suggested that profes- A third ingredient of its successful pas- sional and altruistic motivations would sage was that Medicare was built on the override institutional interests-based on historical (utilitarian) assumption that the technocratic logic of forging connec- health insurance in the United States tions between a tertiary specialty center should be centered on the idea of work. and local hospitals (for regional planning), From the very early debates about compul- and on the nostalgic dream that communi- sory health insurance as labor legislation ties would get together on a voluntary ba- between 1915 and 1920, the idea of health sis to organize services for the collective insurance seemed inextricably connected good (for the comprehensive agencies). to work in the United States. Indeed, Medi- The real engine for change lay in fact in care reflected a continuity of interest third-party insurance payments. among social insurance experts, including I.S. Falk and Wilbur Cohen, in building a University-centered regionalism was in vogue in the mid-1960s and was a proposal recommended by the Commission on Heart system of government health insurance as Disease, Cancer and Stroke set up by President Johnson in part of the Social Security system-a sys- 1964, and led by heart surgeon Michael E. DeBakey. The commission recommended regional hospital networks tem that was itself based on work. In the based on university health centers with their associated medi- private system of health insurance that cal schools; there were 87 medical schools in the United States in 1964, though more were planned or under way. Under univer- blossomed after World War II, as well, the sity-based regionalism, hospitals in outlying areas could be workplace was a major focus for determin- linked with more specialized institutions, with the tertiary uni- versity medical center at the core. In turn, patients could be re- ing eligibility for specific packages of ben- ferred to university superspecialists with their batteries of efits, typically negotiated through em- heart-lung machines, artificial kidneys, radioisotopes, and so- phisticated radiology and drug-delivery systems. The proposals ployer-employee bargaining agreements. for regional medical programs were watered down in legislation of 1965 (Public Law 89-239), just as Medicare was in the pro- By 1960 it was plausible to argue that most cess of passage. Their continuing legacy is todays area health working Americans would be covered, in education centers. For a good contemporary description of the issues, see Committee on Labor and Public Welfare, (1965). the future, via workplace insurance ar- " There were at least 150 such agencies by 1974, when they rangements. Medicare, too, was to be tied were replaced under new legislation (Public Law 93-641) by to the idea of work, designed for retired new health systems agencies. But these too were soon to die a quiet death, victims of lack of consensus and rival agendas at workers as an entitlement of the Social the State and local level, and an intrinsic lack of authority in the Security system. money-driven markets of the health system (see Stevens, 1989).

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Fourth, Medicare was predicated on the social classes in the United States, vested assumption that the private marketplace of with different social values: one class (the insurance and providers needed to be sup- elderly) was approved, the other (the indi- ported by government. It was taken for gent) barely tolerated. (The rift between granted in the early 1960s that the U.S. the "deserving" and the "non-deserving" government must and would intervene in poor continues to this day in separate some way. The alternative to Medicare was policy discussion about Medicare, Medic- not to throw the whole issue of coverage to aid, and the uninsured. Indeed, given both the private sector but to seek workable the stigma and the structural constraints of forms of Federal intervention. These pro- welfare medicine in the United States, cov- posals ran the gamut from Federal subsi- erage of the uninsured will probably not be dies of private insurance to a government addressed through the other logical program for the entire population. program of the 1960s, Medicaid.) Medicare, as a government program, Second, many of the problems in medi- protected the status quo of private insur- cine that were observed in the 1960s are ance for the working population and con- still with us: lack of insurance (now chiefly tinued to focus this insurance on the idea of among those of working age and children), work. It was thus to become an essential el- and instances of professional or bureau- ement in the United States' apparent com- cratic carelessness, inhumanity, economic mitment to a system of health insurance misbehavior, excessive expectations, and based on work. This commitment is much still a general bias toward superspecialist shakier now, in the , than it once was rather than primary care. A major chal- because of major changes in the job mar- lenge in the 1990s is whether the current ket. Nevertheless, the idea has had con- managed care movement, geared to the tinuing appeal over the past 30 years. If the discipline of the market, will prove success- pattern-card of the Medicare beneficiary in ful in providing comprehensive care. We the 1960s was the retired school-teacher, are replaying, though in a very different the image of the uninsured American in context, some of the debates about the pub- the 1990s is a worker or would-be worker lic and private sector that distinguished , like the elderly before Medicare, acts Great Society years. as a productive and responsible citizen in a Third, and finally, Medicare was itself- culture based on work, but cannot find or and is-a paradox. On the one hand, it has afford adequate insurance. provided untold benefits for millions of eld- But this is looking ahead, from the 1960s erly and disabled Americans. Together to the present. What can we conclude with the civil rights legislation of 1964, about health care in the early 1960s? One Medicare stands as a lasting national com- set of conclusions must be drawn from the mitment to equal opportunity. On the other continuing dialogue in the United States hand, Medicare has camouflaged the wider between the myth of (or aspirations for) a issues for which the Great Society was sup- truly great, unified society and the multiple posed to find solutions: providing for the constituencies and conflicts that actually health coverage of all Americans, from exist; notably, between the policy pulls for acute sickness to chronic illness. We are equal opportunity and the continuing bias still, in many ways, at the point we were in against, fear of, and isolation of the poor. the early 1960s, for the underlying ques- The debates preceding Medicare and Med- tions remain the same. The broader chal- icaid recognized two medically deprived lenge for the 1990s, as for the 1960s, is how

2 0 HEALTH CARE FINANCING REVIEW/ Winter 1996/Volume 18, Number 2 well, and on what terms, an insurance sys- Harris, S.E.: The Economics of American Medicine. tem based both on private insurers and on New York. Macmillan, 1964. the concept of work can provide optimal Health Insurance Institute: Source Book of Health service to the whole population. Insurance Data 1979-80. Washington, DC. 1980. The question "What kind of a health sys- Hurst, T.W.: International Hospital Federation Study Tour in U.S.A. The Hospital: 923-33, Novem- tem do we want?" can still be posed in the ber 1960. language of the 1960s: How great a society Klarman, H.E.: Characteristics of Patients in Short- is the United States to be? There is much to Term Hospitals in New York City. Journal of celebrate on this 30-year birthday. And Health and Human Behavior 3:48, 1962. there is still much to do. Ladies Home Journal: Should Doctors Tell the Truth to Cancer Patients? Ladies Home Journal 78:65, ACKNOWLEDGMENTS . Lembke, P.A.: Is This Operation Necessary? The New Republic, p. 15, November 9, 1963. My thanks to Charles E. Rosenberg, Levit, K.R., Sensenig, A.L., Cowan, C.A., et al.: Na- Robert Sigmond, and Elizabeth Toon for tional Health Expenditures, 1993. Health Care Fi- comments on an earlier draft of this article. nancing Review 16(1):247-94, Fall 1994. Life: Gift of Life From the Dead. Life 59:78-88, Sep- REFERENCES tember 17, 1965. Newsweek: Integration: Now the Hospitals. Andersen, R, and Anderson, O.W.: A of Newsweek 59:25, , 1962. Health Services. Social Survey Trends in Use and Newsweek: Restarting the Heart. Newsweek 65:68, Expenditures. . University of Chicago , 1965. Press, 1967. Ratner, H.: Are Americans Overmedicated? Satur- Burnham, J.C.: American Medicines Golden Age: day Review, May 26, 1962. What Happened to It? Science 215:1474-9, March 19, 1982. Robinson, D.: Is Your Hospital Safe? Good House- keeping 153:131, . Business Week: New Crutches for Damaged Hearts. Business Week, pp. 191-92, October 21, 1961. Russell, L.B.: Technology in Hospitals: Medical Ad- vances and Their Diffusion. Washington, DC. Carter, R.: What Women Really Think About Their Brookings Institution, 1979. Doctors. Good Housekeeping 153:149-53, . Schiltz, M.E.: Public Attitudes Toward Social Secu- rity 1935-1965. Research Report No. 33. Social Se- Committee on Labor and Public Welfare: Hearings curity Administration. Washington, DC. 1970. on S. 596. U.S. Senate, 89th Congress. Washing- ton, DC. . Severino, S.P.: Reprieve for Heart Victims. Satur- day Evening Post 234:37, December 23, 1961. Committee on Ways and Means: Hearings on H.R.1 and Other Proposals. U.S. House of Repre- Silver, M.H.: The Emergency Department Prob- sentatives, 89th Congress. Washington, DC. Janu- lem. Journal of the American Medical Association ary-February 1965. 198:146, 1966. Corning, P.A.: The Evolution of Medicare... From Somers, H.M., and Somers, A.R.: Doctors, Patients, Idea to Law. Research Report No. 29. Office of Re- and Health Insurance. The Organization and Fi- search and Statistics, Social Security Administra- nancing of Medical Care. Washington, DC. tion. Washington, DC. 1969. Brookings Institution, 1961. Fox, D.M.: Power and Illness: The Failure and Fu- Stevens, R: American Medicine and the Public In- ture of American Health Policy. Berkeley. Univer- terest. New Haven. Yale University Press, 1971. sity of Press, 1993. Stevens, R: In Sickness and in Wealth: American Hospitals in the Twentieth Century. Galbraith, J.K: The Affluent Society. Boston. New York. Ba- Houghton Mifflin Co., 1958. sic Books, 1989. Harrington, M.: The Other America. Poverty in the Storrow, H.A.: Social Class and Medical Practice. United States. New York. Macmillan, 1962. Southern Medical journal 56:385-88, 1963.

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Subcommittee on Problems of the Aged and Aging of the Committee of Labor and Public Welfare: U.S.Senate, 86th Congress. Washington, DC. 1959. The New Republic: Whadda Ya Mean, Hospital? (Editorial). The New Republic, p. 9, November 9, 1963. Time: Medicine. Time 83:48-9, January 3, 1964. U.S. Bureau of the Census: Statistical Abstract of the United States, 1966. (87th Annual Edition). Washington, DC. 1966. U.S. Department of Health, Education, and Wel- fare: Part 1, National Trends. In: Health, Educa- tion, and Welfare Trends. (1965 Edition). Washington, DC. 1965.

Reprint Requests: Rosemary A. Stevens, Ph.D., Professor of History and Sociology of Science, University of Pennsylvania, 3440 Market Street, Philadelphia, Pennsylvania 19104.

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