The musings of a physician who served the community for over six decades
367 Topics
Downtown A discussion about downtown area in Philadelphia and connections from today with its historical past.
West of Broad A collection of articles about the area west of Broad Street, Philadelphia, Pennsylvania.
Delaware (State of) Originally the "lower counties" of Pennsylvania, and thus one of three Quaker colonies founded by William Penn, Delaware has developed its own set of traditions and history.
Religious Philadelphia William Penn wanted a colony with religious freedom. A considerable number, if not the majority, of American religious denominations were founded in this city. The main misconception about religious Philadelphia is that it is Quaker-dominated. But the broader misconception is that it is not Quaker-dominated.
Particular Sights to See:Center City Taxi drivers tell tourists that Center City is a "shining city on a hill". During the Industrial Era, the city almost urbanized out to the county line, and then retreated. Right now, the urban center is surrounded by a semi-deserted ring of former factories.
Philadelphia's Middle Urban Ring Philadelphia grew rapidly for seventy years after the Civil War, then gradually lost population. Skyscrapers drain population upwards, suburbs beckon outwards. The result: a ring around center city, mixed prosperous and dilapidated. Future in doubt.
Historical Motor Excursion North of Philadelphia The narrow waist of New Jersey was the upper border of William Penn's vast land holdings, and the outer edge of Quaker influence. In 1776-77, Lord Howe made this strip the main highway of his attempt to subjugate the Colonies.
Land Tour Around Delaware Bay Start in Philadelphia, take two days to tour around Delaware Bay. Down the New Jersey side to Cape May, ferry over to Lewes, tour up to Dover and New Castle, visit Winterthur, Longwood Gardens, Brandywine Battlefield and art museum, then back to Philadelphia. Try it!
Tourist Trips Around Philadelphia and the Quaker Colonies The states of Pennsylvania, Delaware, and southern New Jersey all belonged to William Penn the Quaker. He was the largest private landholder in American history. Using explicit directions, comprehensive touring of the Quaker Colonies takes seven full days. Local residents would need a couple dozen one-day trips to get up to speed.
Touring Philadelphia's Western Regions Philadelpia County had two hundred farms in 1950, but is now thickly settled in all directions. Western regions along the Schuylkill are still spread out somewhat; with many historic estates.
Up the King's High Way New Jersey has a narrow waistline, with New York harbor at one end, and Delaware Bay on the other. Traffic and history travelled the Kings Highway along this path between New York and Philadelphia.
Arch Street: from Sixth to Second When the large meeting house at Fourth and Arch was built, many Quakers moved their houses to the area. At that time, "North of Market" implied the Quaker region of town.
Up Market Street to Sixth and Walnut Millions of eye patients have been asked to read the passage from Franklin's autobiography, "I walked up Market Street, etc." which is commonly printed on eye-test cards. Here's your chance to do it.
Sixth and Walnut over to Broad and Sansom In 1751, the Pennsylvania Hospital at 8th and Spruce was 'way out in the country. Now it is in the center of a city, but the area still remains dominated by medical institutions.
Montgomery and Bucks Counties The Philadelphia metropolitan region has five Pennsylvania counties, four New Jersey counties, one northern county in the state of Delaware. Here are the four Pennsylvania suburban ones.
Northern Overland Escape Path of the Philadelphia Tories 1 of 1 (16) Grievances provoking the American Revolutionary War left many Philadelphians unprovoked. Loyalists often fled to Canada, especially Kingston, Ontario. Decades later the flow of dissidents reversed, Canadian anti-royalists taking refuge south of the border.
City Hall to Chestnut Hill There are lots of ways to go from City Hall to Chestnut Hill, including the train from Suburban Station, or from 11th and Market. This tour imagines your driving your car out the Ben Franklin Parkway to Kelly Drive, and then up the Wissahickon.
Philadelphia Reflections is a history of the area around Philadelphia, PA
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Philadelphia Revelations
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George R. Fisher, III, M.D.
Obituary
George R. Fisher, III, M.D.
Age: 97 of Philadelphia, formerly of Haddonfield
Dr. George Ross Fisher of Philadelphia died on March 9, 2023, surrounded by his loving family.
Born in 1925 in Erie, Pennsylvania, to two teachers, George and Margaret Fisher, he grew up in Pittsburgh, later attending The Lawrenceville School and Yale University (graduating early because of the war). He was very proud of the fact that he was the only person who ever graduated from Yale with a Bachelor of Science in English Literature. He attended Columbia University’s College of Physicians and Surgeons where he met the love of his life, fellow medical student, and future renowned Philadelphia radiologist Mary Stuart Blakely. While dating, they entertained themselves by dressing up in evening attire and crashing fancy Manhattan weddings. They married in 1950 and were each other’s true loves, mutual admirers, and life partners until Mary Stuart passed away in 2006. A Columbia faculty member wrote of him, “This young man’s personality is way off the beaten track, and cannot be evaluated by the customary methods.”
After training at the Pennsylvania Hospital in Philadelphia where he was Chief Resident in Medicine, and spending a year at the NIH, he opened a practice in Endocrinology on Spruce Street where he practiced for sixty years. He also consulted regularly for the employees of Strawbridge and Clothier as well as the Hospital for the Mentally Retarded at Stockley, Delaware. He was beloved by his patients, his guiding philosophy being the adage, “Listen to your patient – he’s telling you his diagnosis.” His patients also told him their stories which gave him an education in all things Philadelphia, the city he passionately loved and which he went on to chronicle in this online blog. Many of these blogs were adapted into a history-oriented tour book, Philadelphia Revelations: Twenty Tours of the Delaware Valley.
He was a true Renaissance Man, interested in everything and everyone, remembering everything he read or heard in complete detail, and endowed with a penetrating intellect which cut to the heart of whatever was being discussed, whether it be medicine, history, literature, economics, investments, politics, science or even lawn care for his home in Haddonfield, NJ where he and his wife raised their four children. He was an “early adopter.” Memories of his children from the 1960s include being taken to visit his colleagues working on the UNIVAC computer at Penn; the air-mail version of the London Economist on the dining room table; and his work on developing a proprietary medical office software using Fortran. His dedication to patients and to his profession extended to his many years representing Pennsylvania to the American Medical Association.
After retiring from his practice in 2003, he started his pioneering “just-in-time” Ross & Perry publishing company, which printed more than 300 new and reprint titles, ranging from Flight Manual for the SR-71 Blackbird Spy Plane (his best seller!) to Terse Verse, a collection of a hundred mostly humorous haikus. He authored four books. In 2013 at age 88, he ran as a Republican for New Jersey Assemblyman for the 6th district (he lost).
A gregarious extrovert, he loved meeting his fellow Philadelphians well into his nineties at the Shakespeare Society, the Global Interdependence Center, the College of Physicians, the Right Angle Club, the Union League, the Haddonfield 65 Club, and the Franklin Inn. He faithfully attended Quaker Meeting in Haddonfield NJ for over 60 years. Later in life he was fortunate to be joined in his life, travels, and adventures by his dear friend Dr. Janice Gordon.
He passed away peacefully, held in the Light and surrounded by his family as they sang to him and read aloud the love letters that he and his wife penned throughout their courtship. In addition to his children – George, Miriam, Margaret, and Stuart – he leaves his three children-in-law, eight grandchildren, three great-grandchildren, and his younger brother, John.
A memorial service, followed by a reception, will be held at the Friends Meeting in Haddonfield New Jersey on April 1 at one in the afternoon. Memorial contributions may be sent to Haddonfield Friends Meeting, 47 Friends Avenue, Haddonfield, NJ 08033.
Ihappened to say I thought it was a pity they had not been landed rather in Pennsylvania, as in that country almost every farmer had his wagon. The general eagerly laid hold of my words, and said, "Then you, sir, who is a man of interest there, can probably procure them for us; and I beg you will undertake it." I asked what terms were to be offered the owners of the wagons, and I was desired to put on paper the terms that appeared to be necessary. This I did, and they were agreed to, and a commission and instructions accordingly prepared immediately. What those terms were will appear in the advertisement I published as soon as I arrived at Lancaster, which being, from the great and sudden effect it produc'd, a piece of some curiosity, I shall insert it at length, as follows:
"ADVERTISEMENT."LANCASTER, April 26, 1755.
Benjamin Franklin
"Whereas, one hundred and fifty wagons, with four horses to each wagon, and fifteen hundred saddle or pack horses, are wanted for the service of his majesty's forces now about to rendezvous at Will's Creek, and his excellency General Braddock having been pleased to empower me to contract for the hire of the same, I hereby give notice that I shall attend for that purpose at Lancaster from this day to next Wednesday evening, and at York from next Thursday morning till Friday evening, where I shall be ready to agree for wagons and teams, or single horses, on the following terms, viz.: I. That there shall be paid for each wagon, with four good horses and a driver, fifteen shillings per diem; and for each able horse with a pack-saddle, or other saddle and furniture, two shillings per diem; and for each able horse without a saddle, eighteen pence per diem. 2. That the pay commences from the time of their joining the forces at Will's Creek, which must be on or before the 20th of May ensuing, and that a reasonable allowance is paid over and above for the time necessary for their traveling to Will's Creek and home again after their discharge. 3. Each wagon and team, and every saddle or pack horse is to be valued by indifferent persons chosen between me and the owner; and in case of the loss of any wagon, team, or other horse in the service, the price according to such valuation is to be allowed and paid. 4. Seven days' pay is to be advanced and paid in hand by me to the owner of each wagon and team, or horse, at the time of contracting, if required, and the remainder to be paid by General Braddock, or by the paymaster of the army, at the time of their discharge, or from time to time, as it shall be demanded. 5. No drivers of wagons, or persons taking care of the hired horses, are on any account to be called upon to do the duty of soldiers or be otherwise employed than in conducting or taking care of their carriages or horses. 6. All oats, Indian corn, or other forage that wagons or horses bring to the camp, more than is necessary for the subsistence of the horses, is to be taken for the use of the army, and a reasonable price paid for the same.
"Note.--My son, William Franklin, is empowered to enter into like contracts with any person in Cumberland county. "B. FRANKLIN."
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To the inhabitants of the Counties of Lancaster, York and Cumberland.
"Friends and Countrymen,
General Braddock
"Being occasionally at the camp at Frederic a few days since, I found the general and officers extremely exasperated on account of their not being supplied with horses and carriages, which had been expected from this province, as most able to furnish them; but, through the dissensions between our governor and Assembly, money had not been provided, nor any steps taken for that purpose.
"It was proposed to send an armed force immediately into these counties, to seize as many of the best carriages and horses as should be wanted, and compel as many persons into the service as would be necessary to drive and take care of them.
"I apprehended that the progress of British soldiers through these counties on such an occasion, especially considering the temper they are in, and their resentment against us, would be attended with many and great inconveniences to the inhabitants, and therefore more willingly took the trouble of trying first what might be done by fair and equitable means. The people of these back counties have lately complained to the Assembly that a sufficient currency was wanting; you have an opportunity of receiving and dividing among you a very considerable sum; for, if the service of this expedition should continue, as it is more than probable it will, for one hundred and twenty days, the hire of these wagons and horses will amount to upward of thirty thousand pounds, which will be paid you in silver and gold of the king's money.
"The service will be light and easy, for the army will scarcely march above twelve miles per day, and the waggons and baggage-horses, as they carry those things that are absolutely necessary to the welfare of the army, must march with the army, and no faster; and are, for the army's sake, always placed where they can be most secure, whether in a march or in a camp.
"If you are really, as I believe you are, good and loyal subjects to his majesty, you may now do a most acceptable service, and make it easy to yourselves; for three or four of such as can not separately spare from the business of their plantations a waggon and four horses and a driver, may do it together, one furnishing the wagon, another one or two horses, and another the driver, and divide the pay proportionately between you; but if you do not this service to your king and country voluntarily, when such good pay and reasonable terms are offered to you, your loyalty will be strongly suspected. The king's business must be done; so many brave troops, come so far for your defense, must not stand idle through your backwardness to do what may be reasonably expected from you; wagons and horses must be had; violent measures will probably be used, and you will be left to seek for a recompense where you can find it, and your case, perhaps, be little pitied or regarded.
"I have no particular interest in this affair, as, except the satisfaction of endeavoring to do good, I shall have only my labor for my pains. If this method of obtaining the wagons and horses is not likely to succeed, I am obliged to send word to the general in fourteen days; and I suppose Sir John St. Clair, the hussar, with a body of soldiers, will immediately enter the province for the purpose, which I shall be sorry to hear, because I am very sincerely and truly your friend and well-wisher, B. FRANKLIN."
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Ireceived of the General about eight hundred pounds, to be disbursed in advance-money to the wagon owners, etc.; but, that sum being insufficient, I advanced upward of two hundred pounds more, and in two weeks the one hundred and fifty wagons, with two hundred and fifty-nine carrying horses, were on their march for the camp. The advertisement promised payment according to the valuation, in case any wagon or horse should be lost. The owners, however, alleging they did not know General Braddock, or what dependence might be had on his promise, insisted on my bond for the performance, which I accordingly gave them.
--Chapter XVI, The Autobiography of Benjamin Franklin
News reports began to surface that big business was talking to Democrats in the White House
about major revisions in the national health delivery system. That in itself was news, because big business normally forbids its employees to talk with regulators, and does not commonly welcome any new regulations. But the Clinton Administration was looking for political allies, while the business community was willing to examine proposals to lighten the burden of employer-based health insurance. The discussions soon probed whether a common system might reduce government costs of Medicare and Medicaid, and simultaneously reduce the costs of employer-paid health insurance. For years, big business had been suspicious that the health community had somehow forced employers to pay an unfairly large share of other people's health costs, through some arcane manipulation of hospital cost accounting. Their term was cost shifting.
The administrators of government programs believed the same thing was happening to them. Since the only group left to benefit were uninsured, the arithmetic was somehow wrong. A 7% population group, most of whom are young and healthy, could not account for annual premium jumps far in excess of the cost of living, occasionally as much as 30% in one year. In both governmental and business minds, the main beneficiaries of cost-shifting must be the hospitals themselves, and the doctors who control them. Somehow, it seems not to have occurred to them that this news was brought to them by their fiscal agents, the health insurance companies, and was therefore likely slanted to avoid attention to middle-man costs. Whenever major negotiations are to be held, CEOs and top politicians take over to make the deals, necessarily basing their judgments on filtered information. Since this is a familiar situation, they employ high-priced consultants.
Clark Havighurst
The five hundred secret members of Mrs. Clinton's task force were willing to listen to the ideas of anyone who had political clout, especially staff members of Congressional committee chairmen. But these people had been struggling with the problem for fifty years to no avail, so the emphasis had to be on change, on big new ideas. Universities and think tanks were especially welcome to comment, and
Clark Havighurst was particularly influential. But there had to be some kind of track record, some practical experience on which to base such an enormous national initiative. The best available model was the Health Maintenance Organization (HMO), whose most famous proponent was Paul Ellwood, a former midwestern pediatric neurologist who had gravitated into health insurance consulting. Ellwood had a vacation home in Jackson Hole, Wyoming, where he then gathered the non-government component of this movement into his front parlor. Insurance companies, human resources officials, academics, and in later stages the news media, were given the Word, an opportunity to criticize, and an opportunity to have their views coordinated with the government group in Washington. There was a rough division of labor, establishing general regions of dominance; but ultimately, the two components intended to fit together in a unified health system for the whole country, bar none. The business community began to see that inevitably, in that case, the final overarching decisions would be made in Congress.
When two unexpected things happen at once, it's natural to think them related, but it nevertheless has been a little hard to see how soaring gasoline prices would be caused by falling prices of California homes, or the other way around. If these explosions are indeed unrelated but only occurred at the same time, it leads to the "perfect storm" theory that neither alone could cause a market freeze-up, but perhaps two at once would overwhelm the safety buffers of international markets. Whichever way it turns out to have been, there is a political hazard. The cold northeastern part of the country is mainly concerned about the cost of home heating fuel, while the warm southwestern states naturally focus more on the housing glut and falling home prices. The political danger would be that congressional representatives of the two regions might get polarized along those lines, potentially blocking effective national action to rescue either problem.
All of this may turn out to be a pipe dream. Eight months after the financial panic began, evidence has been brought forward that a quite sizeable amount of the rise in the price of oil, as much as half of it, may be due to speculative activities by hedge funds, attempting to use oil as a hedge against the falling dollar. Since the dollar is falling because of interest rates lowered by the Federal Reserve attempting to rescue banks, as well as stimulus packages passed by Congress for the same purpose, everything may be part of the same parcel. If this theory proves out, it helps concentrate government action on the basic culprit and quiets at least some of the blame game.
It even suggests a partial solution might be to persuade Europeans to be less protective about the abnormally strong Euro and let it ease a bit. This is the third identifiable source of the weak dollar, which the American public has so far largely ignored. During a presidential election campaign, the aroused American car driver might be persuaded to raise quite a fuss about what those non-voters across the ocean are up to again.
The Right Angle Club was honored to have the wife of one of its members, Marjorie G. Jones wife of Jonathan Jones, as its speaker at a recent Friday lunch meeting. Both are Quakers, as you might expect from couples with those names. Marjorie told us of her interesting experiences with a typical Quaker concern, supplying college education to incarcerated prisoners.
Graterford Prison
In this case, she was not acting as a J.D., which she also is, but rather as a teacher, teaching college-level History at Graterford Prison to sure-enough felons, under the auspices of Villanova University, and before that, at Sing-Sing Prison. Pennsylvania comes out looking rather shabby by comparison with New York in these matters, an example of which is the Pennsylvania Law that no one may teach Social Science except with a Ph.D. degree, even though they have a J.D. as she does. Similarly, there are four thousand prisoners in Graterford, while the much more famous Sing-Sing has only seventeen hundred. Pennsylvania hates to blow its own horn, even when the subject is fairly non-glamorous. It even goes as far as spell-check, which never heard of Graterford, but has no trouble recognizing Sing-Sing, up alongside the Hudson River, in Ossining, NY -- which is only half as large.
Eastern Penitentiary
The Quakers of Pennsylvania conceived of Eastern Penitentiary, whose central theme was solitary confinement, hoping in the Quaker tradition for the calming effect of silence to soothe the prisoner into remorseful rehabilitation. Most Quakers would not see quiet reflection as a punishment, but the rest of the world under the leadership of Charles Dickens no less saw it as hideous torment, cruel and unusual punishment. Most Quakers will tell you they rather enjoy an hour of silence.
Ever since their own imprisonment in the 17th Century, the Quakers have had a particular interest in helping the plight of the incarcerated. The rest of the world may yet turn away from prison as a punishment, because prisons are so expensive, costing more than it costs to go to Harvard, and having an incidence of recidivism close to 65%, plus nearly universal drug use. The Quakers, seeing That of God in every man, specialize in giving college degrees to inmates, and have a recidivism rate of around 1%. Mrs. Jones frankly admits there are some people in stir who deserve to be there and would be a hazard to society if released. Pennsylvania has little sympathy with "visitation" rights, which are greatly enjoyed by New York prisoners, while Pennsylvania is more attracted to privately operated prisons, with their incentive for welcoming more prisoners the better.
HIV (AIDS) and Hepatitis B, Hep C
A week ago, a new development clouded the issue of what should be done about the punishment of crime. For twenty years, we have had a cheap simple test to demonstrate the existence of Hepatitis C, but no acceptable treatment. Like HIV (AIDS) and Hepatitis B, Hep C seems to have got its start in homosexual males, and gradually spread into the rest of the community by "dirty needles" in the intravenous drug world. The first two are coming under control with new drugs and vaccines, but Hep C just festers on, and eventually kills the victim with cirrhosis. But last week, the whole matter changed with the announcement of twenty new drugs with more than 95% cure rate in three months, and unfortunately a $65,000 price tag per patient. That's about $150 billion for the known cases clustered around penniless American prisoners, to say nothing of what might immigrate from abroad. There are about 30 million American residents intentionally excluded from those federal programs Congress is now wrangling about, including several million incarcerated prisoners. If even the Obama administration didn't know what to do with prisoners' health costs, it isn't easy to see a federal solution to it, and since the states are overwhelmed by health costs already, they won't likely be eager to add to them, either.
Because we had a test for Hepatitis C for twenty years before we had an effective treatment for it, patient identity is pretty well classified. It will become glaringly evident that the people who don't have the disease will be forced to pay for those who do, and those who do will already have all of the common characteristics for being discriminated against -- black, male, convicted homosexual criminals, to which must now be added the accusation of spreading disease. The prisoners are mostly destitute, and Hepatitis C is contagious to the rest of the population.
On the other hand, it is simply unthinkable to turn these patients loose untreated, no matter what other foreign nations may be bold enough to try. The "solution" is apt to revolve around forcing the drug companies to lower prices as a punishment for curing a disease, and the rest of the population to suffer more taxes. Unfortunately, this is apt to concentrate public ire on criminal violators, homosexuals, drug addicts, immigrants, and black people. It is also apt to stimulate a desire to eliminate prisons by constraining their budgets even further below humane standards. You can expect Congressional hearings about the failure of competition to lower prices, and indeed it really is unlikely that twenty drugs would spontaneously make an appearance overnight, achieving a 95% cure rate, all at the same time. More likely, the manufacturers hoped to recover their investments, before the disease disappeared. But somebody is likely to get flogged, perhaps ejecting prisoners from jail back toward the whipping post, perhaps by looking for deeper pockets within the pharmaceutical industry.
What financing has done to technology is far more upsetting than anything technology ever did to financing. We have here a classic collision of viewpoints. The medical world each thinks the other is getting in its hair, and each thinks it o more important than the other: "I may need you to be able to eat, but you need me to stay alive." Detente would seem to be the wisest policy for both.
Let's begin an exploration of peace terms with several random illustrations, In 1950, I was acquainted with Dr. John Gibbon of Philadelphia, who is given main credit for developing the heart-lung machine. I was able to see the water pump and the boxes of screening, wire and plastic hoses from which it was constructed. The work of developing it was enormous, but the machine looked pretty rickety. I remember thinking the whole project wasn't going to amount to much. In another basement of Jefferson Medical College at the same time, one of the prototypical nuclear scanners was developed. Across town at the University of Pennsylvania, Mauchly and Eckert had just built the world's first computer, financed by barrels of government money a war effort. Because of that cost, Time magazine predicted a probable maximum world market of four machines.
Perceptions obviously have changed in the intervening 30 years. Today, the cost of heart operations and nuclear scanners is a problem worthy of convening invitational conferences, whereas. the cost of computers has declined so dramatically that I own three of them with greater power and reliability than ENIAC.
What moral do these experiences teach us: that technology destroys budgets, or that technology becomes drastically cheaper and more available? A third possible moral is that technology responds primarily to the signals society sends or the incentives society creates. Money, as the common measures of value in society, is the telegraph by which society sends its signals. A fourth moral is no we don't want to believe: that pouring money into something makes it immediately harder to get. The best way to make something universally available may be to leave its price alone.
The Price of Technology Instead of leaving the price of technology alone, we created service benefit, cost-reimbursed health insurance during the Great Depression of the 1930s. On the whole, that experience seems successful. Later, we used post-war wealth and exuberance to provide service-benefits, cost-reimbursed health insurance to those who could not afford the premiums and finance it federally. At the time, the difference was thought to be only a matter of quantity or degree, but the 1965 programs actually invoked an entirely new principle without our recognizing it.
The Blue Cross principle of the 1930s stimulated medical demand by encouraging the "moral hazard" of all insurance; that it makes benefits seem free, hence stimulates profligate usage. What was new about the 1965 programs was unlimited medical demand invading the budget of the federal government, the only entity that can print money to cover deficits. Since we obviously cannot fine-tune health care to synchronize with the business cycle, an inherently inflationary stimulus was placed where it would do most damage whenever the business cycle pointed up.
Indeed, as the cost of medical care was driven upward by nearly unlimited demand, an old stimulus began to get into gear. During the 1930s, the spread of the then-novel prepaid health insurance idea was encouraged by the Internal Revenue Service, which took the remarkable position that an employer paying for health insurance premiums on behalf of a salaried employee was not providing in-kind income or making a gift.
Accordingly, the IRS allowed this financial transaction to be treated as a business expense for the maintenance of a business asset, the good health of employees. This tax loophole encouraged the enlargement of health insurance benefits into what amounts to tax-sheltered income, thus spreading the moral hazard of insurance to new segments of the health field, creating a clamor from other groups (even chiropractors) that they had been excluded unfairly from this Santa Claus largess.
At least one union negotiated more benefit money than there existed I any insurance policy for the money to buy. It reacted to that discovery by demanding that the insurance company create something to use it up. In recent years, such stimulated expansion of benefits has been at least as large a factor in the escalation of health insurance premium as the inflation of units costs of preexisting benefit areas.
The healthcare industry quietly makes rude noises at hearing other industries complain that their international competitive position has deteriorated because of escalating fringe benefit costs. (If those noises have not been load, it is time they got louder.)
During a typical conversation at the bargaining table, the union would ask for a dollar an hour more management would respond by offering 50 cents, plus 30 cents in fringe benefits. That package was as good as a dollar to the union and only cost management 80 cents. The other 20 cents was hidden subsidy of our export prices, of a type we so bitterly criticize in the French and the Japanese. And it ultimately came from the Bureau of Printing and Engraving.
All of the financial pressure pushed up medical prices, particularly hospital prices, and eventually was transmitted through Medicaid and Medicare to the Treasury bond market. If you like inflation, you must love hospital cost reimbursement and tax-exempt fringe benefits.
Efforts at cost control
In 1965, the American Medical Association told the country what was going to happen and was thoroughly vilified for its trouble. There are plenty of doctors still around who were active in the 1965 Medicare battle, and you can easily learn they did not take their position because they were blind to the economic benefits that inevitably would flow to doctors but because they recognized that programs of such stripe inevitably provoke regulatory cost controls.
More than others, doctors live their lives close to the unlimited health care demand of public seeking immortality. Furthermore, as doctors generally are self-employed, they usually share the viewpoint of business owners rather than salaried employees (including those with six-digit salaries plus 24 percent in fringe benefits).
The provoked reaction was not long in coming. When cost overruns immediately appeared, Lyndon Johnson requested a control system in 1967, although the country felt the program had not been given a chance. Richard Nixon imposed wage and price controls in 1972, but they were brief and merely inspired a determination by hospitals to put on fat for the coming winter, usually in the form of depreciable construction projects.
Then Jimmy Carter, with the help of Joseph Califano, unsuccessfully attempted to obtain enactment of a hospital cost containment program patterned after what laughingly was called the experimental programs of Maryland and New Jersey. Today, we are seeing the emergence of sponsorship of the Reagan Administration.
Thed DRG system
New regulations outlining the DRG (Diagnostic Related Group) concept provides that a hospital cannot be reimbursed a total gross amount per case greater than what becomes defined as its peer group. Regardless of gross costs per case, each hospital's year-to-year increase in cost per diagnosis also will be limited.
Since the Standard Nomenclature of Disease and Operations makes theoretical provision for 900,000 diagnoses, and the International Classification of Disease consolidates them into 10,000 fairly common ones, you can be sure that the 480 payment limitation categories to be used under the new reimbursement system will lead to instant chaos. When the outcome is in our favor, we'll remain quiet. When the outcome is adverse. we'll point angrily to the obvious scientific distortion.
The principle for beating the DRG system is really quite simple. If you are going to be paid the same amount of money for simple cases as for complicated ones, find ways to get rid of the complicated cases. That's little tough on the patient with a complicated illness, but business is business. A hospital can't do any good for anybody if it goes bankrupt.
The best solution is to refer complicated cases to centers with more up-to-date specialists than you have. New Jersey is an excellent place for a pilot study of this game plan because complicated cases in North Jersey traditionally have gone to New York City, and in South Jersey, to Philadelphia. Because of employment patterns, such cases not only disappear from New Jersey hospital statistics, they often are covered by out-of-state insurance plans.
The general outline of this system can be seen clearly in the Canadian health system. Being paid the same amount to do a vaccinates as to treat a case of jaundice, the Canadian general practitioner vaccinates like crazy and refers the jaundice to an internist, who refers the case to a gastroenterologist, who refers it to a liver specialist, who, having no one to refer it to, emigrates to the United States. This incentive system takes a profession in which a doctor who receives referrals from colleagues traditionally has been the best in the field, and converts it into a profession in which the doctor who accepts referrals is an idiot.
Perhaps you begin to see why the medical profession in its collision with the financing world sees itself as more sinned against than sinning, and why in 1965 the doctors were willing to forego the certainty of more income rather than witness the soiling of their mission.
A classical error
Hospitals have made a classical error in the way they have used the premier technology, the computer. I pointed out earlier that the meteoric fall in the cost of general purpose computers sharply contrasts with the rising cost of scanners and heart-lung machines, and suggested as an explanation the different ways their use was financed during the past 35 years. If that explanation is to have force, it ought to demonstrate a unique use of computers in hospitals, compared with more overtly entrepreneurial industries.
Almost every industry has its horror stories about computers. However, the financial industries (such as banking and insurance) have more to be proud of in their adoption of computer technology than hospitals do, despite the common estimation that 40 percent of the cost of running a hospital is consumed by information management. A considerable number of hospitals have been spending more than $1 million per year on their computer departments for more than a few years.
Yet, in general, bank computers seem to work pretty well while hospital computers struggle along. What hospital could claim to have exploited computers in the way that Merrill Lynch has done with the cash management account?
I contend that money and numbers are at the heart of the financial business, so if computers are employed to facilitate money and numbers, the bank, insurance company, or brokerage house will prosper. But the practice of medicine is at the heart of a hospital, so if hospital computers are used primarily to facilitate money and numbers, the outcome may be a misdirected mess.
Hospital computer systems should be designed from the inside out, starting with the main mission of the organization, and not from the outside in, starting with the payroll. It is difficult to imagine an organizational philosophy more in conflict with the practice of medicine than batch processing.
The inexpensive silicone chip has made it possible for doctors to get their hands on the computers, and you can expect the history computing to be quite different in the next 10 years from what it was in the era when the machines were too valuable to waste on medical care. As Humpty Dumpty said to Alice in Wonderland, "The question is: who is to be master, that's all."
Technology as measurement
So technology is really a way of measuring organization and incentives, just as money is a way of measuring value and achievement. It isn't good and it isn't bad; it isn't a problem and it isn't a solution. Let me continue with the example of general purpose computers.
Philadelphia is little miffed that, although it nurtured the creation of the general purpose computer, von Neumann gets most of the credit for it and IBM of New York, not Univac of Pennsylvania, gets most of the money from it. The lack of acclaim for Mauchly and Eckert can be set down to traditional Philadelphia distaste for the cult of personality and is a small matter. But in this city, money is another thing entirely.
What happened? Among other things, marketing, management, and luck. I have been told, however, that a central feature of the brilliant marketing of successive computer generations has been synchronization of those generations with the depreciation cycles of the one ones.
The purchaser of a computer has to have enough money to buy it, and he gets that money by depreciating his old one. When it can be predicted that his old machine is fully depreciated, he is ready to be told that a new generation has just emerged from the research department is told to cool it.
I know of at least one purchaser who put in an advance order for a multimillion-dollar machine before it was announced, feeling certain that it was time for a new generation to appear. The announcement actually appeared within a month of his prediction.
IBM's competitors often rushed to announce breathtaking scientific breakthroughs, only to find themselves with a great news release but without production capacity or customers with cash. With a more hard-nosed attitude toward the business of technology, IBM could anticipate years in advance when it was going to be producing and marketing a new generation, even though management had only a hazy idea of what the machine would look like.
Things occasionally work the other way, too, as in the famous story of the introduction of the 360 lines of computers at a time when the software operating system didn't work. While the sales staff sold thousands of 360s, 1,700 programmers were sweating in Poughkeepsie, trying to make it rule. They did get it running and the gamble proved to be one of the most successful in the history of corporate endeavor.
The point is that what was driving the computer industry was not programming, electronics, or genius; it was the tax code defining the depreciation cycle. Just as what is driving the medical industry now is the reimbursement system.
The incentive approach
My advice from the world of technology to the world of finance is if you want technology to be less of a problem, there are some things you can do. You can give up your fringe-benefit tax loophole, for example. Self-employed people like me won't miss it, you can be sure. And you can give up cradle-to-the-grave first dollar coverage and assignment of benefits. You can start to make overt payment for teaching, research, and charity instead of forcing the medical system to bury these costs in the cost of sickness. And you can encourage the state and local governments to shoulder their proper load, instead of dumping it on Washington.
Some of my colleagues worry that I may encourage you to kill the goose that laid the golden egg. While I think cost reimbursement (retrospective or prospective) laid an egg all right, I don't think doctors need to worry much. Sooner or later the realization is going to dawn that there is only one really effective way to reduce hospitalization costs. That is to choke down all the class warfare talk about physician income and offer to pay doctors a higher incentive fee to perform the same service in a less expensive setting.
When you want someone to do something that will save you money, the traditional approach has been to offer to split the savings with him. There are other ways of persuading people to do what you want, of course, including scolding and threatening them. But until the incentive approach is tried and found to fail, it will be reasonable to suppose that people really aren't serious about the matter. After all, it was the incentives in the system that made technology whatever it is today, and it will be incentives that make it whatever it becomes tomorrow.
109 Volumes
Philadephia: America's Capital, 1774-1800 The Continental Congress met in Philadelphia from 1774 to 1788. Next, the new republic had its capital here from 1790 to 1800. Thoroughly Quaker Philadelphia was in the center of the founding twenty-five years when, and where, the enduring political institutions of America emerged.
Philadelphia: Decline and Fall (1900-2060) The world's richest industrial city in 1900, was defeated and dejected by 1950. Why? Digby Baltzell blamed it on the Quakers. Others blame the Erie Canal, and Andrew Jackson, or maybe Martin van Buren. Some say the city-county consolidation of 1858. Others blame the unions. We rather favor the decline of family business and the rise of the modern corporation in its place.
Originally the "lower counties" of Pennsylvania, and thus one of three Quaker colonies founded by William Penn, Delaware has developed its own set of traditions and history.
Start in Philadelphia, take two days to tour around Delaware Bay. Down the New Jersey side to Cape May, ferry over to Lewes, tour up to Dover and New Castle, visit Winterthur, Longwood Gardens, Brandywine Battlefield and art museum, then back to Philadelphia. Try it!
Millions of eye patients have been asked to read the passage from Franklin's autobiography, "I walked up Market Street, etc." which is commonly printed on eye-test cards. Here's your chance to do it.
In 1751, the Pennsylvania Hospital at 8th and Spruce was 'way out in the country. Now it is in the center of a city, but the area still remains dominated by medical institutions.
Grievances provoking the American Revolutionary War left many Philadelphians unprovoked. Loyalists often fled to Canada, especially Kingston, Ontario. Decades later the flow of dissidents reversed, Canadian anti-royalists taking refuge south of the border.
