Charity does not begin to take care of the need. Decent char care is usually not available in small towns and rural areas, and ev in large cities it is far from satisfactory. Table 1 shows that only small percentage of those in the very lowest income group in ru areas get any free medical care, though many undoubtedly need it

TABLE 1.-Percentage of families reporting any free medical care received, 1

NOTE.-Adapted from data collected by Bureau of Human Nutrition and Home Economics and Bu of Labor Statistics. Represents percentage of families stating that any family member had received physician, hospital, clinic, dental, nursing, or eye care, drugs, or medical appliances, in the course of year. For details of study, see U. S. Department of Agriculture, Miscellaneous Publication No. 520, Ju 1943.

While it is true that many doctors give their services free, no phy sician can estimate the number of people who do not come to hi when they are in need. Except in emergencies, and sometimes eve then, most people would rather do without care than "lower them selves" to ask for charity.

That there are actually a good many disabling illnesses for which no medical care is received and that these instances are most frequent in the lower income groups is shown by the following table:

TABLE 2.-Percentage of disabling illnesses lasting a week or longer for which doctor care was received

It was on the basis of facts such as these that the subcommittee voiced the opinion in its Interim Report No. 3 that the current "pay as you go" or fee-for-service system must be replaced by "some form of group financing which would make it possible to share the risks and distribute the costs more evenly."

PREPAYING FOR MEDICAL SERVICES

The American people have been trying for over a hundred years insure themselves against the uneven burden of medical care costs. ledical care prepayment plans started in the lumbering, mining, and ilroad industries, usually for workers in isolated places, and spread ter to the larger cities, particularly to industrial establishments. isability benefit plans to compensate for loss of earnings during ckness were started at about the same time by fraternal organizations nd have also continued to grow. The number of people protected, FIGURE 3. PRESENT COVERAGE OF VOLUNTARY PLANS

Source: Estimates for 1945. They agree substantially with estimates by the Social Security Board and by Dr. Morris Fishbein, editor of the Journal of the American Medical Association.

however, is still comparatively small in proportion to the need, and the benefits offered are usually limited.

In 1945 approximately 75 percent of the population had no medical care insurance whatsoever, while 25 percent had insurance against one or more items of medical care costs. (See fig. 3.) Only about 2.5 percent of the population, however, are known to have had what might be called "comprehensive" coverage, i. e., at least doctor's care in hospital, home, and office, and hospital service for illnesses other than those usually excluded by insurance policies (such as mental disease and tuberculosis).

Another 10 percent of the population had part of their doctor's fees covered, usually the surgeon's or obstetrician's fees in hospitalized illness only. The other 12.5 percent of insured persons had only their

hospital bill covered, i. e., bed, board, nursing, operating room, labora tory fees, etc., while in the hospital. (See table 3 and fig. 4.) Rela tively few people had any coverage of dental, home nursing, or pr ventive care costs, or regular health examinations. The figures ma involve a good deal of overlap.

TABLE 3.-Number of people known to be covered by voluntary health insurance, 194

Partial physician or surgeon service (most with hospitalization)..
Hospital care only...

Any item covered (physician, surgeon, general hospital, or dentist).
No prepaid medical care.....

1 U. S. Census Bureau estimate, 140,000,000.

3.5

"Comprehensive" is used to mean at least relatively full physician's and surgeon's care in office, home and hospital and general hospital care.

Principal sources: United States Chamber of Commerce Health Insurance Conference Proceeding January 1945; Klem, Margaret, Prepayment Medical Care Organizations, Social Security Board Memora dum No. 55, June 1945; the Journal of the American Medical Association, vol. 128, p. 1173, 1945; Blue Cros Bulletin, vol. 8, No. 5, May 1945; letters to subcommittee from medical care insurance experts.

The 25 percent of the population with some kind of coverage sub scribed to three main types of plans: Nonprofit hospitalization (Blue Cross), prepayment medical care organizations (sponsored by indus try, medical societies, consumer organizations, private physicians groups, or Government), and commercial health and accident in surance plans. (See fig. 5.)

WHAT THEY GET

More detailed data are available for the approximately 5,000,000 members of various kinds of prepayment medical care organizations Table 4 indicates that the type of medical service offered varies con siderably with the different types of organization. In general, the medical-society-sponsored plans, excluding those in the States of Washington and Oregon, tend to offer more restricted services. Government-sponsored, industrial, private group, and consumersponsored plans tend to be more comprehensive.

2

SERVICE AND CASH

Medical care insurance is of two types-service and indemnity. The service type assures stipulated kinds of medical care, such as physician's, surgeon's, or hospital service, to the patient. The indemnity type pays the subscriber specified amounts of cash toward expenses incurred during illness or accident-so much for a particular operation, hospital stay, or day of disabling illness. In the case of the indemnity type the practitioner or hospital may or may not charge more than the amount of the cash benefit, and the patient may or may not use the money to pay his medical bills. Although the

These plans differ from other medical society plans in their historical origins and relationships with the American Medical Association. They are listed separately by both the Social Security Board and the American Medical Association.

FIGURE 4. THE TWENTY-FIVE PERCENT: TYPE OF SERVICES RECEIVED

FIGURE 5. THE TWENTY-FIVE PERCENT: TYPE OF PLAN

indemnity type of insurance is common, it affords a less satisfe tory type of protection from the health standpoint than do t service plans. It is not designed to guarantee medical servi especially for minor illness and prevention, but to fulfill certs economic functions. These are (1) replacement of wage loss, a (2) reimbursement for part or all of the expenses incurred duri major disabling illnesses. The indemnity and service plans shou be carefully differentiated; the latter is more accurately term "medical care insurance" than the former.

TABLE 4.-Number of persons eligible for care under prepayment medical-ca organizations and percent eligible for specified services, by type of organizatie: 1945

Source: Adapted from data in Klem, Margaret, Prepayment Medical Care Organizations; Social Sect rity Board, Bureau Memorandum No. 55, third edition, June 1945.

BLUE CROSS

The largest of all voluntary health insurance organizations is the Blue Cross system. By October 1945, 18,400,000 people were reported to be covered by this type of plan.

The Blue Cross plans are semiautonomous nonprofit hospital service! plans approved by the American Hospital Association. They cover! the expenses that are ordinarily included in the general hospital bill (bed, board, operating room, ordinary hospital drugs, and nursing service) for a specified period of hospitalized illness, usually for 21 to 30 days. Partial payment for 60 days additional is common Enrollment is mainly by employed groups. The cost for a family of four is usually about $24 a year which may be partly or completely borne by the employer.