CES - Unpublished Study on Health Insurance

The Committee on Economic Security (CES) had four parts: an executive leadership group called the Executive Committee; an Advisory Council of outside consultants and experts; a Technical Board; and an Executive Director. The work of the Technical Board was subdivided into four subject-matter groups:

  1. Unemployment Insurance
  2. Public Employment and Relief
  3. Medical Care
  4. Old Age Security

The CES Executive Committee adopted a statement of objectives at its initial meeting on August 13, 1934:

"The field of study to which the committee should devote its major attention is that of the protection of the individual against dependency and distress. This includes all forms of social insurance (accident insurance, health insurance, invalidity insurance, unemployment insurance, retirement annuities, survivors' insurance, family endowment, and maternity benefits) . . ."

It is clear that the CES intended to produce a complete system of social insurance, in the broadest possible meaning of the term. It was to include workers' compensation, health insurance, disability insurance, unemployment compensation, old-age benefits, survivors' benefits and various types of family and maternity benefits. This was to prove an illusive challenge. When the dust settled, health insurance, disability insurance and survivors' benefits would be absent from the Administration's proposal. They would eventually become part of Social Security, one almost immediately, one not for 20 years, and one not for another 30 years.

The Medical Care group was responsible for marshaling the research and developing the recommendations for health insurance and disability insurance (aka, invalidity insurance). The reports of this group were to be included in the Final Report of the CES to the President, which would in turn be transmitted to the Congress as part of the Administration's legislative proposal.

As the work of the CES proceeded, controversy arose regarding the health insurance and disability insurance area. The medical care industry began to raise questions about the appropriateness of including these functions in the Administration's bill. Special advisory groups from the health care industry were formed in hopes of heading-off any political conflict. As a result, the President agreed to delay the report of the Medical Care group until March 1935 so that the advisory groups and the CES might be able to fashion a compromise proposals agreeable to all parties. Meetings were held at Washington's Mayflower Hotel during November 1934, but the advisory groups and the CES could not come to a meeting of the minds.

By mid-March 1935 the Report of the Medical Care working group was ready. But the CES Executive Committee was split on whether the Report should be part of the Administration's proposal. Frances Perkins and Arthur Altmeyer urged caution, feeling that the inclusion of these controversial proposals might doom the entire legislative package. Harry Hopkins insisted that health insurance was a vital part of the comprehensive package of protection that the Administration should propose. The issue had to be taken to President Roosevelt for his personal decision. When presented with the working group report FDR sided with the faction urging caution and he ultimately decided that the Report should not be released as long as the Congress was still considering the Administration's bill.

As a result of these events, the report on health care of the Medical Care group was not published in the January 1935 CES Report, and it was not released in March 1935. In fact, it has never been published until now. We are therefore making available for the first time, the unpublished Report on health insurance of the Committee on Economic Security.

"Final Report on Risks to Economic Security Arising out of Ill Health"

Other Documents Relating to CES Work on Health Insurance:
1. Excerpt from Peter Corning's history of Medicare (In Adobe PDF format)
In his masterful history of the evolution of the Medicare program, Peter Corning provided a detailed behind-the-scenes account of the unfolding of the health insurance issue during the work of the CES. Corning's account is available above. Corning's full history of Medicare is also available.
2. Ed Witte Memorandum on Health Care Work of the CESIn this memorandum (presumably from December 1934) Edwin Witte, Executive Director of the CES, is trying to document the "official story" regarding the controversy surrounding the issue of health insurance during the Committee's deliberations.
3. CES Staff Proposal on Temporary Disability Insurance (In Adobe PDF format)Section D of the unpublished Report on Health Care concerned recommendations for a program of insurance coverage for temporary disabilities. This proposal by CES staff was a follow-up to Section D, suggesting draft legislative language which could be included in the Administration's Economic Security bill then working its way through Congress. This document was submitted to the CES Executive Committee before the President's decision that the report on Health Care would not be submitted to Congress.

 

 

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