1

WHIGAN DAILY

State Medical Society Committee
Says Average Family In Michigan

Pays $108 Per

Year For

Doctors

Editor's Note: This is the third of a series of articles written
by Professor Wesley H. Maurer of the department of journalism
concerning a survey of medical services and health agencies made
by a group of physicians for the Michigan State Medical Society.
The committee, headed by Dr. W. H. Marshall, Flint, is comprised
of Dr. F. C. Warnshuis, Grand Rapids. secretary ex-officio; Dr.
L. G. Christian, Lansing; Dr. Bert U. Estabrook, Detroit; Dr. C. S.
Corsline, Battle Creek; and Dr. F. A. Baken, Pontiac. The study
was directed by Dr. Nathan Sinai, professor of public health at
the University.
By WESLEY H. MAURER
Before Michigan physicians and citizens of the state can answer the
question: Can the average person afford adequate medical care under the
present system of practicing? data for two other questions must first be
studied. These questions are:
1. What is the average income in Michigan?
2. What is the cost for adequate medical care, and does this amount
come within the surplus after the bare essentials for living are paid?
In a preceding article it was shown how the survey of medical services
and health agencies in the state, just completed by a committee of the
Michigan State Medical Society, disclosed that the average excess of in-

come over the bare necessity costs of'
living amounts to $357 for Michigan
families, $661 for non-farm families,
and $332 for individuals without
families. This theoretical surplus
disappears entirely for many fami-
lies, the committee points out, when
it is seen that, for the state as a
whole, 35 per cent of the 1929 in-
come was received by 8 per cent of
the population. The facts, discovered
by committee, show that many fam-
ilies have no surplus beyond bare es-
sentials--essentials which do not in-
clude medical, hospital or dental
care-and that many families, con-
stituting a very considerable num-
ber of all the families; have a great
many artificial wants, developed
through our present marketing sys-
tem, which compete with health and
decency needs.
Average Medical Costs
After studying these depressing
figures, the committee next went into
the problem of what it costs the av-
erage family for adequate medical
care. A study made by Dr. Nathan
Sinai, professor of public health at
the University, with Dr. I. S. Falk
and Margaret C. Klem, for the Na-
tional Committee on the Costs of
Medical Care, published earlier this
year by the University of Chicago
Press served as a chapter of the
Michigan committee's report. It dis-
closes that the average medical care
cost for 8,758 families in 17 states,
including 329 families in Michigan,
was $108. These families comprised
approximately 40,000 individuals, the
per capita cost being approximately
$23.58. About $43.05 of the family
bill went to the physician; $19.98 to
athe dentist; $14.09 to the hospital;
$13 to the drug store; $8.80 to nurses;
$2.74 for eye .glasses; $2.34 to sec-
ondary practitioners; and $3.18 for
other costs.
But as m the preceding study of
incomes, averages, the committee
warns, do not tell the story. If they
did, the medical profession, as the
committee points out, might justly
raise the question, "Why all this
widespread coplaintragainst "te
high cost of medical care?" On te
average, reads the report, "four per
cent of the family income is now
used for medical care. This is a
smaller fraction of total financial
resources than is voluntarily spent
for various luxury and so-called
nonessential items." The report adds
here that "this point is often cited
by those who contend that the costs
of medical care are not high. Nor'
could one quarrel with the argu-
ment, if it were true, that each fam-
ily could meet its costs of medical
care by spending each year, or by
setting aside periodically, 4 per cent
of its income." The fallacy, the com-
mittee asserts, lies in the fact that
illnesses have no respect for aver-
ages, be they cost averages, length
of illness averages, or averages of
the number of illnesses per person
per year..
Half Reported No Illnesses
For instance, nearly one-half of
the persons visited in the two-month
periods by competent nurses through
an entire year, reported no illnesses
Others reported, two, three, four or
more. In round numbers there were
about four illnesses per family per
years and one illness per person per
year. But when the amount of care
received is considered, it is found
that 15 per cent of the individuals
visited reported no calls by physi-
cians, whereas 10 per cent of the
individuals visited reported 25 or
more calls by physicians. Moreover,
it 'is shown that 86 per cent of all
families visited received medical
care, but only 48 per cent of the in-
IM t a

FINANCIAL INFORMATION
The average family of 4.4 per-
sons pays $108 a year for medical
care, including payments to doc-f
tors, hospital, nurses, dentists, and
drugs, a' survey for the Michigan
State Medical Society, discussed
in the accompanying article, re-
veals.
But one family in every 10, the
report shows, pays a bill for more
than $250. One-tenth of' the fa m-
ilies pay 41 per cent of the total
medical bill.
Medical bills are paid up to 96'
per' cent' of the anount. The com-
mittee declares that "it is surpris-
ing tliat so much is paid toward
bills which must, in many in-
stances, have come as uiantici-
pated and unbudgeted drains
upon the family purse.,
It is seen, says the report, that
the first step toward a wider and
more complete distribution ofr
medical care is to devise some4
means' of balancing the economic
burden of illnesses.
dividuals in these families got the
care. Of the 51 per cent of the fain-
ilies whio received' dental care, 21
per cent of the 'individuals got this
dental care. Although 20 per cent of
the families wee given hospital care,
only 6 per cent of' the individuals'
required the service. Out of the 13
per cent of the families receiving eye
care, only 4 per cent of the indi-
viduals received the benefit there-
from.
The committee found that income
had something to do with how much
medical care was received. For every
1,000 persons in families receiving an
income of $1,200 to $2,000 a year,
there were 1,048 physician home
calls. for persons in families re-
ceiving $10;000' or more, there were
more than twice as many, or 2,360
per 1,000 persons. This latter figure
is significant in that an "adequate
m e d i c a standard;" arrived at
through other surveys, holds that
there should be annually about 5,650
Home calls per 1,000 population. The
number of calls for the lower group
is only 18 per cent of the "adequate
standard". figure, and the number of
calls for the higher income group,
though twice as high as the number
in the lower income group, is only
41per cent of the standard. In ad-
dition to this, the committee found
that 'for dental, nursing, and eye
care, the volume of care increases
about sevenfold from the lowest to
the highest income classes.
Differences Brought Out
With respect to adequate care the
committee says: These figures "bring
out clearly the differences between
the current receipt and the estimated
need of medical care. This serves as
a clear demonstration of what many
physicians and students of medical
problems have felt to be the case,
that while medical practitioners and
institutions are used to only a part
of their capacity, there is a pressing
need for their services. .The barrier
between the effective demand and
the fundamental needs of medical
.care is' not composed of any one in-
gredient. It is a compound of ig-
norance, inertia, and inability to
pay."
The significance of these figures
might be better understood if they
were placed along side -the conclu-
sion of the P7residents Commission
on Recent Social Trends pertaining
to death rate in the lower income
group. It reads, "Death rates are
still much higher in the lower in-

come groups than in others. Until
a point is reached where the death
rate does not vary according to in-
come it seems paradoxical to claim
that wage earners are receiving a
living wage."
Many Pay Less Than $60 Annually
Most of the families, the commit-
tee found, bear a small proportion
of the total cost of medical care, and
some' are loaded with obligations
which spell financial ruin unless the
"family is aided by the collective re-
sources of the community." The re-
port adds that in the general' popu-
lation, nearly 60 per cent of the fam-
ilies" have' anl annuial charge of less
thani $60 their total amounting to
20 per cent of the entire medical bill.
About 32 per cent of the families
have charges from $60 to $250, which
amounts to 40' per cent of the bill.
But one family out of every 10 has
charges of $250 or more, and this 10
per cent pays 41 per cent of the
total bill. The committee also found
that well-to-do and rich--namely,
families with incomes of $5,000 or
more and' constituting 10- per cent
of the families-provide 30 per cent
of- the income of medical practi-
tioners, hospitals, and drug stores.
Do the peope' pay their doctor
bills, their hospital bills, their dental
and drug bills? Yes, they, do, the
committee declares, up to 96 per cent
of them;. rovided, however, that the
bills do not ex ceed the average for
the income class orthat they do not
attain 25 or 50 pe cent of the an-
nual income. When this happens,
the committee states, "non-payment
becomes significant." What i's sur-
prising, the committee Writes, is
that so much is paid toward bills
which must, in many instances, have
come as unanticipated and unbudg-
eted drains upon the family purse.
Problem Not Public Fault
"The problem of medical costl
arises not through the fault of the
public or physicians, dentists, nurses,
or hospitals; it exists because of the
variable nature of illness," the com-
mittee declares. "For the individual,
no one is able to predict during a
given period either no illness, illness
costing' $10, or illness costing $500
or more. Therefore, medical care,
with the exception of certain preven-
tive services, is not a budgetable
item.
"Reviewing the data on population
income and medical costs," the con-
clusion reads, "it is seen that the
first step toward a wider and more
complete distribution of medical care
is to devise some means of balancing
the economic burden of illness. A
general increase of average income,
while extremely, desirable for many
reasons, would still leave the prob-
lem for many individuals.
Before the economic setting for
the whole problem of medical care
is complete, data pertaining to the
economic status of physicians should
be carefully reviewed.
Of the 4,725 physicians engaged'
in private practice in the state, 43
per cent received in 1931 an income
of less than $2,500, the survey com-
mittee for the Michigan State Med-
ical Society found in its study of in-
comes for physicians. About 30 per
cent, the committee discovered, re-
ceived an income below $2,000.
The committee in its report shows
that it does not expect the public-
especially that part of it which has
charged the medical profession with
getting quick riches through exces-
sive rates-to accept this statement
without skepticism, but the figures
from which it draws these state-

ments have been carefully tabulated,
"qualified, and checked.
The motives of the committee
might be seriously 'questioned if it
had not just completed a study in-
which. it concluded that since 'the
cost of medical care was unevenly
distributed some system must be de-
vised whereby the burden of medical
cost to, the public must be lightened
through more even distribution. The
traditional reply of the physician to
the public, based in part on guessing
and emotionalism, is; to deny cate-
gorically, in the first place, that
medical costs are high, and, in the
second place, to insist that physi-
cians are not getting rich.
Figures On Medical Incomes Tragic
But the reply of this committee,
supported with facts, is much more
mindful of all factors. It says in
effect: "It is true that medical costs
are a burden to many, largely be-
cause the type, duration, and care
of illnesses are not predictable. It
is true, also, that a great many phy-
sicians are living below an adequate
standard of living. The figures per-
taining to physicians' incomes pre-
sent as tragic a situation in Michi-
gan as the high cost of illness doer
to the family. Obviously, some
change must be made in the distri-
bution of medical care so that thf
medical cost of the public might b
lightened through more even dis
tribution, and some means must b4
found whereby the physician can be
employed to his full capacity." What
recommendations the committee will
make along this line will not be dis-
closed until the report is placed- into
the hands of the House of Delegates
at the Society's annual convention
in Lansing, July 12.'
The committee cites in its report
several reasons for this low income.
One is that the 'gross income of a
physician includes,' on the average
for aLl practitioners, 41 per Cent
costs. 'twenty per cent of the charges
made by physicians, for instance, are
never collected. (This should not be
confused with an earlier report in
which the committee stated that 96
per cent of the medical bills are paid,
since the physician's share of the
medical bill is roughly one-fourth of
the entire bill and he takes the
greater share of the unpaid portion.)
Unequal, Distribution of Incomes
Anothe reaston for the low in-
comes, the committee points out, is
that there is an unequal distribution
of income among physicians similar
to the unequal distribution of the
general population. Of the $31,136,-
000 paid for the services of 4,725
physicians in private practice of
Michigan, $16,396,000 went to 3,047
general practitioners, $7,231,000 to
906 partial specialists, and $1,510,000
to 772 complete specialists. Whereas
the average net income of all physi-
cians is $3,900, the net income of all
general practitioners in all counties
except in the Upper Peninsula, are
almost $1,000 short of this average,

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CONCLUSIONS OF COMMITTEE
Conclusions reached in a survey
of medical costs in the. state' of
Michigan, as discussed in the ac-
companying article, are :
About 43 per cent of the 4,725
private practice physicians earn
less than $2,500 a year. Thirty
per cent receive an income below
$2,000.
About 4i per cent of the phy-
sician's gross income goes to pay
the costs of practice. Twenty per
cent of the bills of physicians are
never paid.
Approximately 1,670 specialists
and part specialists receive as
much as 3,047 general practition-
ers ini the state.
Fifty per cent of each type of-
practicing physician in Wayne
County receives less than $2,500.
"Here is presented," says the
report, "cold statistical evidence
of the grinding and clashing of
certain cogs that make up the.
social structure. One cog is in-
sufficient medical service; another
is insufficient medical income."


'



the committee states. The income
for partial specialists, the rport con-
;inues, is 50 per cent greater and the
ncome for the complete specialists
s twice as large as the income for
he general practitioner. Wherever
,he number of complete specialists
is small, the report adds, the net in-
come of the general practitioners is
larger.:
A third factor affecting incomes is
the size of communities. Physicians'
practicing in cities under 5,000 in
southern Michigan report an average
income of $2,484. Or they may prac-
tice in a community which is over-
crowded. For example, 50 per cent
of each type of practicing physician

in Wayne County receive under
$2,500.,
A fourth factor entering incomes
of physicians is the ability of the
consumer to pay or the recognition
~of the need for medical care.
Average Physicians' Incomes
The average income for physicians
presents a much brighter but less ac-
curate picture. The average gross
incomes for practicing physicians in
the state amounts to $6,590. One-
half of all the physicians in the
northern part of the Lower Penin-
sula receive net incomes under
$2,657.
The committee found that among
1,289 physicians reporting from
throughout the state, representing a
good cross section of the entire pro-
fession, 30 per cent received an in-
come below $2,000. On the other
hand, 5.9 per cent of them reported
incomes above $10,000. In a table
listing the reports of all physicians,
it is shown that 41 physicians, or 3.2
per cent ofthose reporting, operated
during' the year 1931' on deficits; 138,
or 10.7 per' cent, reported incomes
from 0 to $999; 201,ror 15.6 per cent
received from $1,000 to $1,999.1
Among the higher incomes, the table
shows that 19, or 1.5 per cent, report
incomes from $10,000 to $11,000; 13,
or 1 per cent, report incomes of $11,-
000 to $12,000; 12, or .9 per cent, re-
port incomes of $15,000 to $19,199;
8, or .6 per cent, report incomes from
$20,000 to $24,000; and '3 ,reported
incomes of nore than $30;000.
"Economically," states the com-
mittee, "the average practicing phy-
sician's position is not an enviable
one. He enters private practice after
a large outlay of capital funds at
the age of 27 or 28. He must make
further outlay of costly equipment,
and he must expect to spend 7 or 8
years in gaining the confidence of
the community to the end that he

jmay apply himself to practice fR ia.
reasonable portion of his time. T_-
wonder is that so few physicians u
aside the high code of professiuni
ethics, and collapse under the e";
nomic pressure that so many sufic.i
Evidence Of Social 'Visturbanc v
"Here, then, is presented cold
tistical evidence," concludes
committee, "of the grinding ,m
clashing of certain cogs that n -"e
up the social structure. One co,
insufficient medical service; ano' ,+"'
is insufficient medical income.
say that each member of the pu h
should save for the emergency of ,ii
ness is to evidence little knowle, iC
of the extreme range of costs. r
hold that the physician should SH s ,
as an equalizer, donating service; .r
charging according to individual
cases, is to exhibit little understari
ing of either public or medical li
comes and little knowledge of the
psychology of spending."
The succeeding article in thiu
series will discussed the problem o&
the over-crowding of the profession
and the trend of physicians from
the rural to the urban districts.
Rubber-Wheeled Cars
To Get Chicago Tests
CHICAGO.-(/P)---A new kind- of
street car, with rubber wheels, is soon
to make its appearance in. Chica!&';
This was announced by Guy A.
Richardson, president of the Chica
surface lines, when he made pub':
the first report on four years of i
search in behalf of 25 of the larg"
street railway companies of the n
tion.
"A new application of rubber in
wheels, springs and trucks has !,-'-
the overhead trolley wheel as i ,
most distinguishable sound," he ::R;;


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