Exit Doctors' Bills
Ontario’s first voluntary health insurance association provides medical care at a cost of 5 1/3 cents a day
WE ASK YOU to consider the strictly hypothetical case of an entirely imaginary Bill Smith. This Bill Smith might be any ordinary middle-class worker. White collar or blue overall makes no difference. He might be you.
Bill Smith is married. Dependent upon him he has Mary Smith, his wife, and one child. He is employed. I lis salary, or wages if you prefer, amounts to thirty dollars a week. Mary Smith is a shrewd, intelligent housekeeper who reads the home hints in the newspapers and the advisory articles in the women’s magazines. She knows all about budgets. From each weekly or semimonthly pay envelope she sets aside separate amounts, so much for rent, so much for food, clothing, entertainment, transportation and incidentals. In normal times the Smiths make out. They may even have a few dollars in a savings account, but there won’t be many of those dolkirs. Not on the Smiths’ income.
In normal times the Smiths make out, yes. But, because
both Bill and Mary Smith are sober-minded, thinking individuals. they have one dread, one haunting fear that stalks ghostlike always in the back of their minds. They do not nourish this fear. They don’t let it get them down. But it is there, darkly shadowing their lives day in and day out.
It is the fear of illness. Perhaps more accurately the fear of the price of illness. What it will cost to be sick.
Illness. That is a certain thing, sooner or later in human life. But the cost of illness is uncertain. Illness may mean no more than a cold in the head. It may mean a dangerously inflamed appendix, leading to an operation, or something even more serious. Suppose Bill Smith meets with an accident, is laid up for weeks with a broken leg. Then what?
The Smiths are young people. They would like to have another baby. Two babies are ever so much more fun than one. Can they afford another baby? They know what the first one cost them.
Any illness, even a small illness, means doctors’ bills,
medicine, perhaps hospitalization. Illness compels an extraordinary expenditure. The Smiths cannot budget for extraordinary expenditures beyond a certain definitely limited amount.
The trouble is that it is almost impossible adequately to budget for illness from the average workingman’s income. Fifty dollars w'ould likely liquidate the cost of an ordinary illness, including minor hospital charges; but a more serious siege, involving a major operation, special nursing, anaesthetics, X-rays and the rest of the vitally necessary procedure, may run into hundreds of dollars. One long illness may gulp a life’s savings. Such things happen. To be ill is in itself a sufficient tragedy. To have to worry about how to pay for getting cured is just so much extra grief.
That is why the obsessing dread of an inevitable illness darkens the habitually happy lives of the Bill Smiths, as it does those of tens of thousands of other average Canadian families.
It is to exorcise that fear demon, to dispel that haunting dread, that such nonprofit organizations as Associated Medical Services, Incorporated, are slowly coming into being in Canada.
ASSOCIATED Medical Services, first of its kind in ■ Canada, celebrates its second birthday on June 1. Two years ago. on June 1, 1937, two people, Dr. J. A. Hannah and his secretary, moved into an old building owned by the Ontario Government at 11 Queen’s Park, Toronto. They took over a suite of offices on the second floor, which is also the top floor, since the place was designed originally as a private house. They pried the lids off packing cases containing printed forms and other office stationery, and went to work. The first public voluntary—note that word “voluntary”—health insurance organization in Canada was on the job.
The system upon which Associated Medical Services operates is called health insurance for want of a better phrase. Actually it is insurance against the high cost of sickness. In return for the payment of a small sum monthly —two dollars per person per month is the maximum— Associated Medical Services undertakes to pay doctors’ bills, hospital bills in a semiprivate ward, consultants’ fees, and all other necessary sickness expense, up to S800 for a single subscriber within any twelve-month period.
It is not a Government organization, although it does enjoy the blessing of the Ontario Provincial Administration, which loans it the offices it at present occupies as headquarters. The powerful Ontario Medical Association approves its activities, put up most of the money required to get it started. At this writing Associated Medical Services is operating in Toronto, Ottawa, Hamilton and Oshawa, and in Norfolk and Oxford counties. Its relations with doctors and patients are entirely on a voluntary basis. Folks who wish to insure themselves against the expense of future illnesses may subscribe, or leave it alone. Physicians may agree to participate in its activities, or choose to remain aloof.
In the beginning, after its first month’s operations, Associated Medical Services had collected a not very grand total of eighty-five subscribers. By June 1 this year, after two years of activity, the membership list will be well over 7.000. More than 1,500 Ontario physicians are participating, more than 800 in Toronto, 140 in Ottawa. Since the first of the year new members have been signing up in increasing numbers every month, until now the monthly membership increase is around 800 subscribers. Eventually it is the aim of its officers to extend the influence of the organization into every Ontario county.
Associated Medical Services, incorporated in Ontario, does not operate beyond the boundaries of that province; but its swift progress during the first two years of its existence has been observed all over the Dominion and in many parts of the United States. Provincial and State medical associations are studying the plan constantly, some through personal investigation, others through correspondence. Dr. J. A. Hannah, managing director, and a prime mover in the organization from its inception, sometimes has to put in sixteen hours a day keeping up with his mail.
No Red Tape
IT IS a simple, easy-to-understand proposition, notably free from red tape. A.M.S. employs no salesmen, makes no profit, pays no dividend, does not advertise. Its membership increase is due entirely to word-of-mouth publicity —one satisfied customer tells a friend—or to the subscribers who have followed the advice of family physicians. The complete headquarters staff comprises only eight people. Branches are operated by a medical officer and a nonmedical assistant who acts as secretary-stenographer-bookkeeper.
There are two forms of subscription—individual and family group. An individual subscription costs S2 a month. The family group plan starts with the father, ranked as an individual subscriber. For the first dependent, usually the wife, the rate is SI.75 monthly. For the second dependent, SI.50, for the third, $1.25. for the fourth and each additional dependent, SI a month. Taking the average family
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of four, father, mother and two children, the cost of insurance against sickness expense is $6.50 a month, or approximately five and one-third cents a day per person. Deductible from this, A.M.S. allows a discount of three per cent on annual subscriptions paid in advance, two per cent on six months advance payment. Over thirtyfive per cent of A.M.S. subscribers earn less than $100 a month.
Subject to certain restrictions, subscribers select their own physician, if he is a participant. The age limit is sixty-five. The service will not accept responsibility for cases of epilepsy, mental disorders, or tuberculosis, where persons so afflicted can be taken care of by established institutions. A.M.S. will not pay for treatment of venereal disease. The agreement takes in ordinary accidents, but not industrial accidents covered by the Workmen’s Compensation Act. I n the case of a subscriber who, prior to his acceptance, has been suffering from a chronic ailment—a cardiac condition, or diabetes, for example— A.M.S. declines responsibility for treatments of that condition, but will take on the expense of treating other illnesses that may occur, Thus, a subscriber with valvular disease of the heart at the time of his acceptance into the plan, cannot charge further heart treatments against the service; but were he to contract influenza, or appendicitis, A.M.S. would take care of those bills.
IIow to Subscribe
r"PO SUBSCRIBE to Associated Medical Services the applicant first fills out a printed form, giving such details as address, employer’s address, names of dependents, name and address of the physician selected, and signs a pledge to accept the regulations of the organization. While the association may ask for a medical examination it is not essential before becoming a subscriber, if the applicant's history is satisfactory. If acceptable, a contract is signed and the subscriber receives an identification card, about the size of an automobile driver's license, bearing the signatures of himself and his doctor.
All payments are in advance, and failure to make payments when due results in suspension of the service. Persistent delinquency may lead to cancellation of the contract. To foil chisellers who wait until they are sick before rushing up with a cry for help, service does not begin until two
months after the first day of the month nearest the date of application.
Obstetrical cases are handled on a separate basis. Both father and mother of the baby must have been subscribers for ten consecutive months before the child is born. At hospitals where there is a charge for infants, care at the rate of $1 a day. up to fourteen days, is provided. After that date the two-weeks-old infant may be entered as a dependent subscriber, so that future expenses for medical treatment will be covered.
With the exceptions cited, an A.M.S. contract carries all costs of illness, whether treated at home, in a doctor’s office, or in hospital*
Physicians who wish to participate in the Associated Medical Services plan have to fill out an application form, as well as subscribers. They must be members in good standing of the Royal College of Physicians and Surgeons of Ontario, and besides agreeing to accept the rules of the organization, they must subscribe to section four of the form, which reads thus:
I further undertake to uphold the principles of voluntary nonprofit prej payment for medical services; and at no time will 1 by word or act endeavor in i any way to advance my personal inter! ests by reason of such membership in j Associated Medical Services, Incorpori a ted.
To some extent the A.M.S. plan is insurj ance for physicians as well as patients. | Doctors’ bills are paid according to the j schedule of fees designated by the Ontario j Medical Association. Accounts are subject to the recommendations of the medical I members of the Branch Board, and the ¡ approval of the Board of Directors of A.M.S. Physicians’accounts are rendered to the branch office and are paid from headj quarters on the tenth of each month.
Participating medical men are given a j certificate which they must display in ! their offices, as identification. Careless, ! dilatory doctors, or those who for any j reason become unacceptable, are liable to j suspension. On the other hand a physician j who wishes to quit the organization may j do so at any time, by submitting a written j resignation.
rT'HE administrative setup is simple and !
economical. Executive officers include ] a president, vice-president, managing
director, chief medical officer and secretary-treasurer. The headquarters personnel includes a statistician and as many office workers as needed. An actuary is engaged, but in a consultant capacity only.
Branch offices are administered by a board of not less than three members, with physicians in a majority of one, but not more than one. The board chooses a branch medical officer and a branch secretary. The M.O. looks after the medical end of the branch’s business. The secretary handles nonmedical affairs. That’s all there is to it.
Officials of Associated Medical Services currently h lding office are: Dr. il. W. Baker, Woodstock, Ont., president; Mr.
F. G. Beardall, of Toronto, vice-president; Dr. J. A. Hannah, Toronto, managing director. Directors are: Dr. E. A. Broughton, Dr. H. C, Wales, and Messrs. Douglas
G. Higgins and J. R. Johnson, all of Toronto. The secretary-treasurer is K. W. Atcheson.
Actually, Associated Medical Services is the baby of the Civil Service Association of Ontario, but its roots lie deeper and are more widely spread than that. The medical profession as a whole is seriously disturbed by the possible difficulties of State medicine. Also, the problem of preventive medicine, about which doctors have talked for years, is forcing itself into the foreground more and more as time goes on. Depression conditions, painfully emphasizing the economic factor in the relationship between physician and patient, have operated to compel action. Such plans as that of Associated Medical Services constitute the medical profession’s flank attack on the problem of medical economics. They represent a sincere—if somewhat belated effort on the part of Bill Smith’s doctor to understand and show practical sympathy for Bill Smith’s money worries.
Favored by Physicians
SO FAR as the inauguration and growth of Associated Medical Services can be traced to an individual, the credit goes to Dr. J. A. Hannah, now toiling as managing director of the organization. Dr. Hannah, a specialist in neuropathology, was ap|x)inted to a |x>sition on the medical staff of the Ontario Government in 1930. Automatically, he became a member of the Civil Service Association. Always deeplyinterested in the sociological problems inseparable from the practice of medicine, he studied prevent ive medicine and healthinsurance plans, State and industrial, for years. The British and other European systems of State insurance, the grouphealth insurance plans adopted by many large corporations in Canada and abroad, and especially the system used by the big mining comj>anies in the North Country, came under his survey. As a result of Dr. Hannah’s investigations and rejxirts, the Civil Service Association appointed an Insurance Committee, including Dr. Hannah. Mr. Beardall and Mr. Selby Draper, with Major McManus, then president of the Ontario Civil Service Association, as chairman ex-officio, to draw up a plan for health insurance inside the Ontario Civil Service.
A draft of the proposed plan was presented in due course to the Toronto Academy of Medicine, with a request for approval and co-operation. The Academy looked favorably upon the idea, asked for a ruling from the Ontario Medical Association. The annual meeting of the O.M.A. held in London in 1936 accepted the plan in principle, urged further steps toward organization.
In February, 1937, a complete plan, with by-laws and a constitution polished up to the last semicolon, was presented to the Board of Directors of the Ontario Medical Association. The directors accepted the draft, moved to grant financial assistance to the infant organization until such time as it could stand on its own two feet. The sum of $5.000 was needed to get A.M.S. started. The Ontario Medical Association voted $3,800 of this amount. The Civil
Service Association put up the balance of
On April 9, 1937, Associated Medical Services, Incorporated, received its charter as a nonprofit corporation from the Ontario Provincial Secretary. It took two months to get the necessary forms printed, and the office was opened on the first of June.
Not every practicing physician in Ontario is in favor of the plan. There remain a few who snort at the whole idea as pampering the indigent and shackling individuality. Some object to the limitations of fees and the control of consultations by the board. These are in a minority. In Toronto, where the plan is most generally in use, of 950 practicing medical men, 850 are enrolled as participants in Associated Medical Services.
V\ 70RD OF mouth advertising is ** directly responsible for the growth of the organization, now assuming snowball proportions. Large industries and employment groups, the schoolteachers, the Dominion Civil Service Association, the Bell Telephone Company, are interested. So are the Canadian Manufacturers’ Association and the Toronto Board of Trade, both of which organizations have made a study of the plan. So far the dental profession has held off, although the actuarial basis upon which A.M.S. operates includes the sum of $4 a year per person for dentistry, and as the success of the scheme becomes more positively evident the cooperation of the dentists will be sought.
The ultimate effect of such a plan— voluntary insurance against the cost of being sick—upon the health of the community at large, cannot help but be beneficial. To lift that load of apprehension from Bill Smith’s shoulders, to arrange matters so that Bill Smith will not have
constantly at the back of his mind, “Suppose I get sick!” will improve his mental condition. He’ll do better work, live more cheerfully, be happier. Again, it seems fairly obvious that, with no doctors’ bills to worry about, more people will consult their physicians for what appear as minor ailments—the common cold, for instance. There will be less serious sickness, because incipient infections will be checked before they become firmly established. Medical examinations of children will become more frequent. Prenatal care of expectant mothers is made available to every family subscribing to the plan.
Concrete instances are plentiful, of subscribers who were more than glad of their A.M.S. affiliation. One girl, working for a wage of $18 a week, required a major operation the cost of which, with family physician’s and surgeon’s fees, hospital costs and nursing, totalled $350. Another, an office girl with four dependents, developed that dread scourge, cancer. Her operation, including follow-up X-ray treatment, cost Associated Medical Services $550, and gave the girl herself definite knowledge of just what a payment of $2 a month could mean in sickness security.
Allowing that nothing on this earth is perfect, it is still difficult to discover serious flaws in this particular scheme of voluntary health insurance. Some people with whom this reporter has discussed Associated Medical Services have objected that there is no provision for the return of even a part of the dues paid in by subscribers who persist in remaining fit, who never were sick a day in their lives.
We mentioned that angle to a friend, a partner and sales manager in a small manufacturing concern, the head of a family of
He said: “Good grief, man! Isn’t it worth twenty-four dollars a year to me not to be sick?”
Which seems like a good note to end on.