mmim^^p^^ I ; - ■ ■ * DOCUMENTS DEPT. nin -Ti-j itA REPORT of the HEALTH INSURANCE COMMISSION of the STATE OF ILLINOIS n » « , ) , MAY 1, 1919 [Printed by authority of the State of Illinois.] i6rf^3 DOCOMENTa DEPT, MEMBERS OF HEALTH INSURANCE COMMISSION. William Butterworth. Dr. E. B. Coolley. Edxa L. Foley. Dr. Alice Hamilton. Mary McExerxey. John E. Eaxsom. ]\Iatthew Woll. M. J. Wright. William Be ye. Chairman. H. A. MiLLis, Secretury. Springfield, III. Illinois State Journal Co., State Printers • 1919 17269—2500 TABLE OF CONTENTS. PAGE. letter of Transmittal ' V PART T. SUMMARY STATEMENT OF FACTS, WITH THE COMMISSION'S - FINDINGS AND RECOMMENDATIONS. Chapter I. The Problem. 1. The number ill at a given time 4 2. The sickness experience of a year 9 3. Disabling sickness of wafe^e-earners 11 4. The cost of sickness 15 .'. Sickness and changes in the standard of living; sickness and poverty.. 19 6. Some Illinois vital statistics ^ 22 7. Conditions and behaviour causing disease and death 27 8. Responsibility for sickness and premature death 33 9. The prevention of sickness and premature death 3 3 Chapter II. Combating Disease and Conserving Health. 1. State legislation designed to improve conditions and to conserve health. 38 2. The department of public health 39 0. Local health administration 42 4. The campaign against tuberculosis 49 5. The campaign against venereal disease 54 6. Maternity care 57 7. Infant welfare work 65 8. Medical care of school children 71 1>. The physician in industry 74 Chapter III. The Care of the Sick. 1 . Medical Treatment 77 2. Hospital service in Illinois 83 3. Dispensaries and clinics 90 4. Nursing care. 94 Chapter IV. Existing Health Insurance. 1. Introduction 105 2. Establishment funds 109 3. Trade union benefit systems 115 4. Insurance by fraternal orders , 118 5. Foreign benefit societies 124 6. The health and accident business of casualty insurance companies and assessment associations ... 126 7. Industrial life insurance .132 8. Group insur ance ^35^ 9. "Insurance as found among wage-earners in Chicago 141 10. The existing health insurance summarized 144 Chapter V. The Commission's Findings and Recommendations 149 , 1. The problem of sickness and non-industrial accidents stated 150 / 2. Illinois vital statistics 154 / 3. The causes of and responsibility for disease 155 4. Health legislation and public health administration 156 5. The tuberculosis problem. . ." ' 158 ''. The problem of venereal disease 159 7. Maternity care and infant welfare work 160 8. Hospital facilities 161 j 9. Public health nursing 162 I 10. Health insurance 162 I 11. Occupational disease 167 112. The Con-nnission's recommendations 167 168 i:.xlilbii: 2 — Biil I'o^ investigation of conditions causing maternal and infant Tnf)Tt'^ lif V- ..174 461^83 CONTENTS— Concluded. PART II. REPORTS OF SPECIAT. TXVESTIGATIOXS. PAGE I. A 2>iuuy of Chicago Wage-earning Families — E. W. Burgess, Ph. D... ...17{» IT A Study of the Disability Data of a Selected Group of Association. "< in the nited States — H. W. Kuhn, Ph. D . .31^: Hi. Dispensaries and Clinics in Illinois — John E. Ransom : ' ' IV. Occupational Diseases in Illinois — Dr. Alice Hamilton. V. Health of Illinois Coal Miners — Dr. E. R. Hayhurst ^ 1 Insurance by Casualty Companies and Assessment Associations — Prbf essor W. M. DuCfus ^ VII. Fraternal Insurance — Professor W. M. Duffus VIII. Industrial Life Insurance — Professor W. .M. Duffus IX. Group Li fe and Group Disability Insurance — Professor W. M. Duff us . . . . -t X. Foreign Benefit Societies in Chicago — Jakub Horak; ' .! XI. Establishment Funds in Illinois — Professor A. E. Suffern XII. Trade Union Benefit Systems — Professor A. E. Suffern XIII The (Present Status of Health Work in the Public Schools of Illinois — Wi G. Reeder "*V: XIV. Sickness Insurance in Germany — Henry J. Harris. Fh. D XA^ The British Health Insurance System — Edith Abbott, Ph. D b' XVI. The Health Insurance Movement in the T'liit. fl States — Professor .Tohr. R. Commons CHAPTER I. THE PROBLEM. THE EXTENT^ COST, CAUSES AND RESULTS OF SICKNESS AND DEATH AMONG WAGE-EARNERS AND THEIR FAMILIES.^ The many specific questions the Commission may be expected to answer as a result of its investigations and thought may be grouped into five general ones, viz : ( 1 ) What is the problem of sickness and death ? (2) What is being done to control and prevent disease and to conserve health? (3) What is being done to care for the sick and physically dis- abled? (4) AVhat is being done to compensate for loss of earnings and to meet the bills caused by sickness and death? and (5) What more, if anything, can and should be done to meet the situation as foun^? These questions are of course more or less interrelated. The problem is closely connected with what is being done to solve it; what more, if anything, should be done to solve it depends upon existing facilities and methods for dealing with it which will be presented in a subsequent chapter as well as upon its nature and extent as revealed by analysis and then measured. But while the general questions are each related to the other it has seemed advisable to set them out in five sections or chapters, each of which is devoted primarily to a consideration of one question. It will not be expected, of course, that the data here used by the Commission will have been drawn entirely from its investigations and hearings, or investigations made for it. They are drawn from what are believed to be acceptable sources for the purpose, but naturally emphasis s placed upon the results of investigations made by the staff or by the many officials and others who have cooperated with the Commission, and the testimony given at the Commission's informal conferences and public hearings. The results of the more important investigations made for the Commission are set out in Part II of this report in such detail as •space limitations permit. What, then, is the problem of sickness and death among wage-earners nd their families in Illinois? This question is partially answered by ata relating to the extent, cost, causes and results of sickness and death ^mong those who occupy this economic position in the community. First of all, however, comes the question as to the number of wage- ■arners and their dependents to be considered in this connection. The population of Illinois July 1, 1918, as estimated by the Bureau of the Census, was 6,317,783. The Bureau of the Census reports, for he year 1910, that 40.7 per cent of the population of Illinois were gain- iully occupied, and from its reports for that year it has been determined that in excess of 72 per cent of those gainfully occupied were working for wages or small salaries. ^ For brevity "sickness" is here used to cover iUness and non-industrial accidents. I Applying these percentages it may be estimated that the number of wage-earners (in all branches of employment) in Illinois, for the year ending July 1, 1918, exceeded 1,850,000. In 1910 the number of de- pendents per person gainfully occupied was about 1.46. Applying this ratio, the total number of dependents in wage-earning families would be in 1918 more than 2,700,000. Thus the wage-earners and their families in 1918 may be estimated in round numbers at 4,600,000 in a total popu- lation of 6,317,783.2 In setting out and measuring the problem of illness, it will be well first of all to discuss in summary fashion (1) the number ill at a given time; (2) the sickness experience of a year; (3) disabling sickness.; among wage-earners; (4) the costs of illness; (5) sickness and standards? of living, poverty and dependency; (6) some Illinois vital statistics; (7) conditions and behavior causing illness; (8) responsibility for con-^ ditions causing illness; and (9) the extent to which sickness may be prevented and disabling defects remedied. (1) The Number til at a Given Time. The number ill in the community at a given time is of importance^ as indicating the amount of medical work to be done to conserve and restore health, increase efficiency and prolong life, and as one factor in measuring the economic loss due to sickness. The statement has become current that on a given day about 3 per cent of the population are sick. Of course those who make a statement of this kind are not unmindful of the fact that the number of sick varies greatly from time to time, and that the number will depend to a greatly' extent upon the use of the word "sickness," and especially whether it is limited to disabling sickness or is used more inclusively. The figure mentioned above was based largely upon foreign experi- ence. It is only recently that statistics of our own derived from can- vasses and medical examinations have become available. Those we now have would indicate that the percentage for disabling sickness is rather less and that for all sickness very much greater than three. The more important statistics may be summarized. In August and September, 1917, the Health Department of Phila- ^ delphia made a survey or house to house canvass in which it was found that of 12,019 persons covered, 514 or 4.28 per cent were sick at the time. The term "sick" was evidently rather inclusively defined for only 36.7 per cent of those reported as sick were recorded with "disabling sick- ness." A survey made of Kensington, a working-class district selected as fairly typical of working-class districts in and about Philadelphia, showed that 167 or 5.22 per cent of the 3,198 persons in the 743 families, were sick at the time the canvass was made in the early spring of 1918. A careful medical census or canvass of the members of 1,455 fam- ilies in Framingham, Massachusetts, taken in April, 1917, showed that 6.2 per cent were sick. In this case it is important to note, however, that the agents and nurses taking the census "were instructed to ascertain ^ not only illnesses creating total disability but minor disabilities as well." » The occupational figures here used are based upon the Census of Occupations, 1910. f- ^The original interpretation of the term 'illness' covered all minor and serious affections in need of medical or dental advice or treatment." When "the term was restricted to mean a sickness involving actual com- plete disability at the time/' the percentage was reduced frorn 6.2 to 1.8.-^ In these investigations cited, the surveys were not only local, but partial or of small areas. Much more significant and fairly acceptable are the investigations of serious cases of illness made during the years 1915 to 1917 by the Metropolitan Life Insurance Company. All told seven surveys have been. made by the Metropolitan. The canvasses were made by the agents of the company, usually in the course of their regular duties. The data were obtained from families in which the company had one or more policyholders ; hence nearly all of those canvassed were of the wage-earning group. The agents were instructed not to make any particular selection of families for the purpose and to include every member of each family canvassed. Again, the agents were asked to record only serious cases of sickness ; trivial cases were not to be returned. Moreover, they were instructed to determine whether the sick person was able or unable to work.* The place^ time and most general results of the several surveys are best shown in summarized form, as follows.^ Community. Date of survey. Number of- persons enumerated. Percentages. Sick. Unable to work. Rochester, N. Y Trenton, N. J State of North Carolina Boston, Mass ." Chelsea District, New York City Cities in Pennsylvania and West Virginia. Kansas City, Mo Average for the seven surveys. Sept., 1915 Oct., 1915 Apr., July, 1916 1916 A.pr., 1917 Mar., 1917 Apr., 1917 34,490 3,491 66,007 97,259 24, 043 374, 301 34,267 633,858 2.31 2.55 2.85 1.96 1.48 1.96 2.52 2.02 1.92 1.98 2.29 1.F0 1.38 1.85 2.39 1.83 Possibly the winter months when sickness is more prevalent were not adequately represented in these surveys, and the distribution by time of year is therefore not ideal. Any under-statement because of this would, however, likely be offset by the inclusion with sickness of all cases of disability due to accidents and injuries. With 633,858 persons enumerated by agents who had personal knowledge of most of them and who needed no introduction to the families canvassed, and with a large number of industrial centers widely scattered, it is believed that the results arrived at measure fairly accurately the relative number of per- sons in wage-earning families known to themselves to be seriously sick at a given time? The difficulties and expense involved in making a wide survey of this kind in Illinois would have been so great that it was not attempted. 3 Framingham Monograph No. 2, The Sickness Census, p. 8. * Sickness Survey of Principal Cities in Pennsylvania and West Virginia, by Lee K. Prankel and Louis I. Dublin, p. 3. ^ Compiled from the several published reports of the Metropolitan's Community bickness Surveys. The column "unable to w^ork" is not limited to wage-earners. 6 5^ ■ Moreover, it was believed that such a survey carefully made would only ' confirm the results obtained by the Metropolitan, since the death rates, composition of the population, and the industries of Illinois differ little from those in the communities canvassed. Finally, the results of can- vasses to ascertain the amount of admitted sickness are after all of lim- 'ited value. Of much greater value would be findings based upon exten- sive medical examinations. Such examinations are indispensable in meas- uring the problem in hand when looked at from the point of view of the amount of medical work which might be done to conserve and restore ■ health, increase efficiency and prolong life. Such data have been made available by a medical census at Framingham, Massachusetts, the ex- amination of men for induction into the Army and Navy, the examin- a ation of wage-earners by industrial physicians, and the examinations • • of school and other children. Framington was selected as a typical American industrial center of suitable size for the study of tuberculosis, and incidentally of sickness in general. The population is about 20,000, In 1917 canvasses were made of families from which the percentages of "admitted sickness noted above were obtained. Two "medical examination campaigns have also been made — in April and November, 1917. All told 4,473 separate individuals from 1,783 families were carefully examined by physicians brought to Framingham for that purpose. The canvassers arranging for the examinations were instructed not to include sick individuals under treatment and an effort was made to get a fair selection 'i by nationality, economic condition and residence. "Of the total ex- amined, 77 per cent or 3,456 were recorded as ill;" 1,017 were normal. "Illness" was defined so as to include diseases or defects of either a serious or a minor character. In 1,006 of the 3.456 cases the trouble was defective teeth, leaving 2,450 who were diseased. If the diseases and defects are divided into "minor ills" and "serious affections," the respective numbers were 2,343 and 1,113.« Thus some 25 per cent of the total examined were found to have "serious affections." It is inter- esting to note, also, that, while the percentage of those between 15 and • The "minor ills" and "serious affections" were as follows : Minor Ills. Defective teeth 1 006 Enlarged tonsils 563 Colds, coryza, etc 132 Bronchial pulmonary affections (undiagnosed) 265 Glandular system 277 Miscellaneous affections ............ '. . . . . [ , , . . . \[[[ ' '// ' iqO Total —^J^ -, .,,,. Serious Affections. Tonsilitis • .,„ Pharyngitis *. .'.'. ., ii Laryngitis ^^^ Bronchitis « .i^ Cardiac signs |§J Cardiovascular ^i^ Cardiorenal f*^ Renal ' ■.■.■.■.;.■.■.■.■.•.■.■. H Vascular ^° Tuberculosis °^ Miscellaneous .........[.. o qq Total From Framingham Monograph No. 4," pp. ' ii-ig. 44 years of age returned as ill was somewhat smaller than that of the entire number (71 per cent as against 77), the percentage of serious aifections among them was 26 as against 25 in the entire group. These results, briefly stated, are of great value. As the report states, "repre- sentative as the examination groups are of different nationality, economic and geographic sections in the population, it is safe to assume that the examination work indicates the prevalence of illness in a normal indus- trial American community.""^ In stating and measuring the problem of illness, especially from the point of view of the medical work which might be done, the results of the examination of drafted men have great value. As yet only the re- sults of the examinations incidental to the first draft have been pub- lished.^ The men examined, it will be recalled, were between 21 and 31 years of age. The total examined was 2,510,706.^ Of these, 730,756, or 29.11 per cent, were rejected by the local boards. A small percentage of those physically examined and accepted by these , local boards were rejected when again examined by the surgeons in the camps to which they were sent. Of an estimated 393,384 of such men, the surgeons, it is estimated, rejected 22,989 or 5.8 per cent. Combining percentages for men rejected by the local boards or by the camp surgeons, about 35 per cent were found to be unfit for service. Of course the number diseased or physically defective was much larger, for not all such were unfit for service. The various grounds for rejection have been shown for 10,258 of the total rejected. The leading causes were defects of eye (21.68 per cent), defects of teeth (8.50 per cent), hernia (7.47 per cent), defects of hearing (5.94 per cent), heart disease (5.87 per cent), and tuberculosis (5.37 per cent). Each of the other causes assigned accounted for less than 5 per cent of the rejections.^^ The number of men called in Illinois and examined by the local boards was 187,535. Of these, 48,444 or 25.83 per cent, were rejected ^ Framingham Monograph No. 4. pp. 11-12. * More complete data will become available about the first of February, 1919. ^ The data here used are to be found in the Report of the Provost Marshal Gen- eral to the Secretary of War on the First Draft under the Selective Service Act, 1917. See, especially, pp. 44 to 47. ^^ Causes for physical rejections. Number. Per cent. 1. Total number of cases of physical rejections considered 10,258 2. Alcoholism and drug habit 79 0.77 3. Physical undevelopment 416 4.06 4. Teeth ;... 871 8.50 5. Blood vessels 191 1.86 6- Bones 304 2.96 7. Digestive system ; 82 .80 8- Ear 609 5.94 9- Eye 2,224 21.68 10. Jomts 346 3.37 11. Muscles 66 64 U- B-espiratory '.'.'.'.'.'.'.['.'.['.'.'.'.'.'.'.'.'. 161 l!56 1 7 §., '^ y 1 118 1.15 }i- ^^at foot 375 3.65 15. Orenito-urmary (nonvenereal) 142 1 39 16. Genito-urinary (venereal) ' 438 427 17. Heart disease ^ 602 5.87 18. Hernia 766 7 47 19. Mentally deficient '. .■.■.".■.■.■.';.'.'.:: :;:;;::::; 465 4;53 oV" ^i^rvous disorder (general and local) 387 3 77 ^1. Tuberculosis 551 5 37 22. Underweight ..........]....[..[[. 163 1^59 23. Ill-defined or not specified 93 91 24. Not stated .*.'!!.*!.'.'.*.".'!.' i .'!.'.".'.' ." 809 7.'89 8 as physically unfit. This percentage, it is interesting to note, was 3.SB points less than the average for the entire country. In general, it may be said that the largest percentage of rejections occurred in the older industrial states.^ ^ It would be interesting to know how these results would compare with the results of a similiar examination of the much larger number of wage-earners in "the industrial army." Hoping to secure data of value the Commission has sought to secure the results of physical ex- aminations of wage-earners by industrial physicians connected with large establishments in different industries of importance in Illinois. The effort has not been as successful as had been hoped. Accurate records are the exception and not the rule and these records and also the thoroughness and nature of the examinations vary greatly from one establishment to another. The examination of applicants for work and of employees and the record-keeping are far from being standardized and made uniform. Most frequently only causes of rejection are recorded. Moreover, labor policies and the kind of labor needed differ so greatly from one establishment to another that the rejection of applicants does not indicate any definite dividing line between serious and minor ail- ments found. Under the circumstances it would not be helpful to do more than summarize the findings in eight possibly typical cases where the results may be combined. The industrial physicians connected with these eight establish- ments in 1917 examined 69,171 male applicants for work. They found 32,866 or 33.1 per cent of these diseased or defective, and rejected 13,119 or 57.4 per cent of them as unfit for employment. ^^ The re- jected constituted 19.0 per cent of those examined. Among the 22,866 were 1,406 with hernias, 205 with tuberculosis, 342 with kidney trouble, 1,184 with high blood pressure, 1,663 with defective vision, 564 with bad teeth, and 19 with contagious diseases. In using these statistics, it should be remembered that they have been obtained from the examin- ation of men not too ill or too defective to apply for work. The data are of course partial and drawn from too few sources. ^N'evertheless they serve the purpose of indicating that there is much to be considered that is not disabling sickness. To what extent the efficiency of these men is affected by the disease or physical defect found cannot be determined. Many of the diseases and physical defects found in the examinations of draftees and applicants for work have persisted from childhood. At any rate, the examination of school children shows that a very large percentage of them are in need of medical or dental care. In 1915 the Division of School Hygiene of the Chicago Department of Health made physical examinations of children in a large number of the schools. While it cannot be said that these schools were typical of the entire num- ber, the results of the examinations show that disease and defects of importance at the time and in connection with the -efficiency of the next generation of those who work are very numerous. All told 79,383 were " See Provost Marshal's Report, cited above, p. 83. " The percentages of applicants rejected because diseased or defective varied in these eight cases from three-tenths of 1 per cent as a minimum to 54.1 per cent as a maximum. examined. Of this number 37,356, or 47.1 per cent, were found to be defective, and 32,860 were advised to seek treatment. A tabulation of the defects for 35,166 of these pupils showed, the following: Malnu- trition, 804; anaemia, 2,639; enlarged glands, 7,970; goitre, 1,556; nervous diseases, 340; cardiac diseases, 414; pulmonary diseases, 68; skin diseases, 701; orthopedic defects, 171; rickets, 372; defective vision, 7,837; other diseases of the eye, 1,076; defective hearing, 663; dis- charging ear, 372; defective nasal breathing, 2,603; defective palate, 971; defective teeth, 22,711; hypertrophied tonsils, 11,777; adenoids, 4,489; tonsils and adenoids, 4,350.^^ Not all of the above diseases and defects could be remedied or im- proved by treatment. Yet the fact that, of the 37,356 found to be de- fective, 32,860 were advised to seek treatment is very significant. These details relating to Chicago school children are presented be- cause thej^ are not untypical of what will be found in almost any com- munity. In rural communities, where unlike an industrial community, only a minority of the pupils are from wage-earning families, the relative number found to be defective has been shown to be larger than in cities. The Committee on Health Problems of the National Council of Edu- cation has made a very careful estimate of the percentage of physically defective who are likely to be found in any community. The Com- mittee's estimates, based upon a large body of data, and showing results similar to those found in Chicago, are as follows: Defects. Percentages with each specified defect. Urban. Rural. Teeth defects „ 33.5 16.4 12.0 13.4 1.3 7.6 2.7 2.1 .8 1.5 .3 .4 .2 49.0 Tonsils 28.1 Adenoids 23.4 Eve defects 21.0 Ear defects 4 7 Malnutrition 16. Enlarged glands 6.4 Breathing defects 4 2 Spinal curvature 3.5 Anaemia 1.6 Lung disease 1,2 Heart disease 8 Mental defects. . -.8 \. The data presented are sufficient to show that at a given time the percentage of persons with disabling sickness is less than three, that of persons diseased or defective 'is very much greater than three — the figure which has come to be so frequently used in this connection. (2) I'he Sickness Experience of a Year. While it is interesting and important for the reasons stated above to know how many of a working-class group are ill or physically defective at a given time, it is very much more important to know how many are disabled by sickness in the course of a normal year, how long they are "For an account of the work of the Division of School Hygiene, see Part II of this report, Special Report XIII. 10 • disabled, what is the nature of the sickness, whether the wage-earner, housewife or other member of the family is ill, how much time and wages are lost because of the disability, how much is paid out directly for care and medical treatment, afid how much economic strain is involved. Un- fortunately few investigations extending over a year have been made of wage-earning families as a group, and the investigations made by the Commisson of necessity have been limited to residents of Chicago. Reference has been made to the survey of the Kensington district in Philadelphia. A preliminary statement of the results is to the effect that of 743 families investigated, all but 12.4 per cent had had one or more cases of sickness in the course of the preceding twelve months. One hundred seventy-five families had had one case each; 173, two cases; 162, three or four cases; 126, five or more, and, of these, 26 had had ten or more each. Though it is stated that many of the minor illnesses were overlooked, 1,989 or 52.2 per cent of the 3,198 persons in the families canvassed were found to have suffered from cases of serious or minor illness in the course of the preceding twelve months. In order that it might obtain as accurate information as possible with reference to the various aspects of the problem presented, the Com- mission has had an intensive study made of all families, wage-earning and non-wage-earning, in forty-one blocks located in working-class dis- tricts in Chicago. The blocks were selected with care so that they would be as nearly typical as possible of wage-earning families in respect to race, industries in which they were engaged, and the degree of skill of the normal breadwinner, and were taken from most parts of the city. The studies of a few other blocks were left incomplete, but inasmuch as the families were taken in order as they were reached by the investigators and there was, therefore, no selection, the schedules have been combined "with those obtained from the blocks studied completely. All told, ex- tensive and uniform schedules were obtained for 3,048 families with a total of 12,450 persons. The investigators, who were carefully selected and who for the greater number were experienced in work of this kind, were instructed to secure a record of all cases of serious sickness during the preceding twelve months for each member of the family. Minor illnesses were not to be returned, and, if returned, have been cancelled in editing. They were instructed specifically to enter only serious chronic illnesses and such acute temporary cases as caused disability for work on the part of wage-earners for at least a week, or the confinement of others to the house or bed for the same length of time. Exceptions were made, how- ever, in the case of serious shorter illnesses, as, for example, bad tonsils requiring removal, and in other cases where a physician had been called.^* While the data obtained by the investigators were for only 3,048 families residing in something more than forty blocks in Chicago, it is believed that they indicate fairly accurately how much disabling sick- ness of a serious nature may be expected in a normal year. The twelve months covered were about normal in Chicago's experience (as indi- " The detailed results of this investigation are set forth by Prof. E. W Burgess in Special Report I, in Part II of this report. Only a concise summary of the sick- ness experience is presented here. 11 cated by the normal death rate for that period), the families were repre- sentative and sufficiently numerous, the investigations were carefully made, and sickness among these families should not differ materially from sickness among wage-earning families in the normal industrial community. The investigations made in Chicago showed that 2,005 or 65.8 per cent of the 3,048 families^^ residing in the blocks studied, had had one or more cases of serious illness (as defined above) during the twelve months. Of the 12,450 members of these families, 3,450, or 27.7 per cent of the entire number included in the study had been seriously sick. In 571 families the sickness was confined to those gainfully occupied as wage-earners or otherwise. In 543 families there was sickness of those gainfully occupied and of dependent members of the families. In the remaining 891 families the sickness was not that of a wage-earner. Putting the matter in a different way, the working time and income of one or more persons gainfully occupied in 1,114 of 3,048 families had been reduced by reason of sickness; in 543 of these cases sickness of others had added to the bills; while in 891 families sickness had not caused a direct loss of income for as much as a week but may have added to the bills. The duration of illness, the loss of income, and the direct outlays for medical and other care are presented below in sections (3) and (4). (3) Disahling Sickness of Wage-earners. Unusual importance attaches to the sickness of wage-earners be- cause their disability involves loss of wages as well as direct outlays for medical care. Impairment of income by reason of sickness may prove more serious than unemployment because of the enlarged bills which must be met. A finding of the Commission on Industrial Relations with refer- ence to the amount of working time lost because of sickness is frequently quoted. In its final report the statement is made that "each of the thirty-odd million wage-earners in the United States loses an average of nine days a year through sickness."^® The data obtained from our various investigations warrant the conclusion that this is only a slight over-statement of the average time lost. There were 4,474 wage-earners in the blocks covered by the Com- mission's investigations in Chicago. Of these, 1,222 were returned as having been seriously sick as defined above, but only 937 (20.9 per cent of the entire number) lost a week or more during the year because of sickness. The total number of weeks lost by 901 reporting in full was 6,632. This was an average of 7.35 weeks for each wage-earner sick. These data are few and have limited value because they were set down in weeks and were obtained from the families and not from accurate records. What is needed is accurate records of every day lost because of sickness during an entire year by the wage-earners in repre- sentative groups. The agents have searched for records approaching ^5 These include 340 families where the head of the familv was not a wage-earner. " Commission on Industrial Relations, Final Report, p. 202. * 12 ^ this ideal but with little success. No trustworthy records have been found in Illinois except those incidental to the payment of sick benefits and these never give a complete account of disabling sickness. Most of the organizations paying sick benefits to wage-earners keep no records except of the days for which benefits are paid. Almost always there is a waiting period so that many, and not infrequently a majority, of the cases of shorter duration are not recorded at all. Again, compensation is limited to a certain period of time, most frequently 13 weeks. The full record of the longer cases is not made. Perhaps no compensation is given in chronic cases or for venereal diseases or for sickness due to intemperance. Perhaps the membership of the organization is selected by medical examination of applicants for work or by medical examin- ation for admission to membership. And, finally, if use is made of the records of establishment funds, it is likely that the sickness rate obtained is too favorable for establishments as a whole because most of the firms concerned give more than the usual attention to sanitation and other things reducing the amount of sickness. In its study of establishment funds the Commission secured as complete data as possible for their sickness experience. Three of the largest of these with 134,274 members and paying benefits where dis- ability lasted for more than 6 days, paid benefits to 40,157 or 29.9 per cent of the combined membership in 1917. The total days of disability in these compensated cases was 1,189,179, or an average of 29.6 days per case. The total da3^s "of disability as given would average 8.9 days for the entire membership. Thirty-three smaller funds with 66,854 members and paying benefits where disability lasted more than 7 days, paid benefits in 1917 to 10,629, or 15.9 per cent of the membership. The total days of disability in these conipensated cases was 343,229 or an average of 32.3 days per case. The total days of disability as given would average 5.1 days for the entire membership. Data were obtained covering the experience of other funds which began payments with the first, third or fourteenth day, but the number of members in these as grouped are too small to have any particular significance. This Commission has cooperated with the Commissions in Ohio, Pennsylvania, and Connecticut in an effort to secure as large a body of data as possible from representative establishments and labor organ- izations. The data are of unusual interest because they are drawn from the largest number of wage-earners thus far studied. The results have been combined by Professor Kuhn of Ohio State University, and are presented in Part II of this report.^^ Taking nine comparable benefit associations with 663,163 wage-earners exposed, 131,921 or 19.9 per cent were compensated for disabilities caused by sickness or non-indus- trial accident and lasting for 8 or more working days. The total days of disability in these cases, with any excess over 189 in any case not in- cluded, was 3,610,536, or an average of 27.4 days per case. Another combination of data, somewhat larger,i«shows that about three per cent of the cases lasting more than 8 days last longer than 189 davs and that " See Part II, Special Report II. "See Tables VI and VII of the study cited above. 13 the total days of disability in the course of the year is increased by about 16 per cent by that fact. Thus the total days of disability during the twelve months for the 131,921 disabled for 8 days or more was 4,335,388. This spread over the entire 663,163 exposed would give an average of 6.54 days each, disabilities lasting not more than 7 days not being reckoned in. While these data indicate something of the loss due to sickness and non-industrial accident, they are not presented and cannot be accepted as an accurate measure of disabling illness among wage-earners as a whole. Even where to the time compensated, the time covered by the waiting period and that extending beyond the period covered by benefits have been added, an understatement is involved for a number of reasons. In many cases there is a selective process eliminating those who involve most risk of sickness; sickness of shorter duration than the waiting period is not included; in most cases disabilities due to certain kinds of disease or intemperance are not compensated and are, therefore, not re- corded; and the maintenance of this benefit plan for which the data have been drawn are frequently accompanied by a health program pre- venting some disabling- sickness which would otherwise occur. The figures presented understate the number sick in the course of the year and the amount of time lost. How much understatement is involved is not known but it is by no means slight. The Bureau of Labor Statistics has recently completed a statistical analysis of the Workmen's Sick and Death Benefit of New York, with an average of 36,972 members covered by the study for the five years 1912 to 1916.^^ The members are employed in many occupations in a large number of industries. This valuable study shows that disabilities of 16.8 of those exposed, caused by sickness^ non-industrial accident, or industrial accident, and lasting 8 days or more, any excess over 189 days not included, averaged 6.3 days for the entire membership. Benefits are, however, paid from the first day of disability. The data show that compensated disabilities lasting not more than 7 days averaged approx- imately one-third of a day per member. This does not, however, show the true average. The disabilities of shorter duration were not fully recorded for the number compensated increased from 271 for 1 day to 2089 for 5 days. The partial evidence available, and it cannot be regarded as entirely representative, indicates the conclusion that about 20 per cent will be disabled for a week or more because of sickness and non-industrial accident and that the workmen collectively will lose in the course of the year between 8 and 9 days because of such disabilities. Only the smaller part of the problem of sickness among the wage- earners is indicated by such a statement as "each of the thirty-odd million wage-earners in the United States loses an average of nine days a year through sickness." If every wage-earner were disabled by sickness for just nine days each year it would not be a serious matter. The most important fact about it from an economic point of view is that " For the tabulated results, see Part II of this report, Special Report II. The Commission is indebted to the Commissioner of the Bureau for these data in advance of publication by him. 14 only a fraction of any representative group is sick in a given year, and that some of these are disabled for such a short period of time that it is of little consequence, while others may be sick for such a long time that an acute problem is connected with lost wages and enlarged bills. In order to get a proper view of the problem the duration of sickness as it varies from the average must be studied. This has been done in the cooperative way indicated above. The results may be regarded as the beginning of an American experience table applicable in Illinois. As already stated, the Ohio, Pennsylvania, Connecticut and Illi- nois' commissions have studied a large number of groups. The experi- ence of the benefit associations indicates that of those disabled for more than 7 days, 65 per cent will be sick for less than four weeks; 19 per cent from four to eight weeks; 7 per cent from eight to twelve weeks; 6 per cent from twelve to twenty-seven weeks ; 3 per cent for more than six months and 1.29 per cent over one year.^^ It is recognized of course that sickness data should be shown by sex, age, occupation, and specific cause of disability. Few of the records used have made this possible. This Commission has, however, been able to show the duration of disability by disease for twenty manufacturing establishments, an office force and a sales force. The results, grouped into uneven periods, are shown in the following table. Total of cases. Number of cases by disease and duration (in days). Cause of disability. 7-12 13-18 19-24 25-30 31-49 50-77 78-100 101-150 151-180 Over 180 Abscess, infections, in- flamai ions 605 236 132 1,225 23 871 1,124 122 106 32 55 180 1,281 867 146 31 77 1,147 303 19 30 419 476 667 12 6 17 9 10 460 365 1 16 368 132 23 32 271 2 170 274 11 9 11 7 24 250 179 i 16 215 50 29 10 157 6 83 71 9 9 4 7 28 122 72 2 3 11 105 32 21 11 80 1 40 38 8 20 64 98 15 171 2 71 47 18 42 10 17 13 45 1 16 12 10 11 4 14 6 24 3 3 7 •2 5 10 4 22 7 > 3 15 2 2 2 2 1 1 2 3 3 ADDondicitis. 3 B adder, kidney Bronchitis, pleurisy .. Cancer 11 33 7 Eye, ear, nose and throat .i; OrlDDe. colds 3 Heart 2fi llcniia 3 Measles Kptiliiiti^ 5 23 81 59 2 3 7 68 9 70 178 98 10 16 12 130 4 9 55 29 7 3 5 34 3 6 34 14 2 120 2 7 30 15 11 4 3 27 4 i4 7 14 7 5 3 37 29 89 1 5 74 Pti. ;v illi«-uiMm isni ......... Stomach, intestines. . . Tuberculosis Typhoid ; Varicose veins and ulcers Miscellaneous Total diseases Off duty accidents 8,243 1,630 3,178 1,122 1,627 168 778 96 499 63 1,051 114 281 24 266 19 167 8 59 5 337 11 Grand total 9,873 4,300 1,795 874 562 1,165 305 285 175 64 348 For a number of reasons the sickness experience of this combined group of employees was unusually favorable as shown by the fact that only 13.6 per cent of them drew benefits on account of sickness and "off duty accidents." The great importance of "off-duty accidents,'' rheu- matism, br onchitis and pleurisy, grippe and colds, and diseases of the •• See Part n, Special Report II. 15 alimentary tract will be noted. The importance of tuberculosis, hernia and heart disease is understated, however, because of the medical ex- amination of applicants for work and the rejection of a considerable number of those suffering from these diseases. The most striking thing shown is the unusual number of cases lasting more than 180 days where the affliction is tuberculosis or heart disease. The Bureau of Labor Statistics has tabulated the data obtained from the Workmen's Sick and Death Benefit Fund by duration of dis- ability, by age and by occupation. The average for cases lasting 8 days or more varied greatly by occupations, the minimum being 2.8 days for jewelers, the maximum 9.2 days for freight handlers. They varied greatly, also, by age, from 4.1 days at age 25 to 10.7 at age 65 and 13.5 (for 17) at age 70.^^ (4) The Cost of Sickness. The Commission has sought to secure as complete data as possible on the cost of sickness among wage-earning families. A summary of the results is presented here. There were 4,474 wage-earners in the blocks selected for study in Chicago. Of these, 1,222 or 27.3 per cent had been seriously sick in the course of the year, but 285 of them had not lost as much as a week at any one time. Of the 937, who did lose time, usable data were ob- tained for 901 who lost a week or more. The earnings of these 901 aggregated $676,087; their wages lost because of sickness^ $107,338. The wages lost were 13.7 per cent of what their earnings would have been but for sickness and an average of a little more than $119 each. If this average may be assumed for the 36 other wage-earners from whom not all of the desired data were secured, and the total loss from disability lasting a week or more were then distributed over the entire number of wage-earners in these blocks, it would give an average wage loss of $24.95 each for the year. The loss (for a week or more) would be about 3.33 per cent of their total earnings as reduced by disabling sickness for these earnings averaged $750.37 per wage-earner for the year. If it is assumed, also, though the assumption may involve some exaggeration, that these wage-earners in Chicago were typical of thj approximately 1,850,000 in the State, the yearns losses of wages because of sickness dis- abling many of them for more than a week would aggregate $46,000,000. The losses indicated become serious only because they are sustained by a minority of the wage-earners and by them very unevenly. Taking ^ 901 who lost wages for a week or more, 286 or 31.7 per cent, lost less' . than 5 per cent of the year's earnings ; 221, or 24.4 per cent, lost 5 but . less than 10 per cent; 82, or 9.1 per cent, lost 10 but less than 15 per * cent; 99, or 11.0 per cent, lost 15 but less than 20 per cent; 83, or 9.2 per cent, lost 20 but less than 30 per cent; 46, or 5.1 per cent, lost 30' but less than 40 per cent; 17, or 1.9 per cent, lost 40 but less than 50 per cent; 52, or 5.8 per cent, lost 50 but less than 75 per cent; and 15, or 1.7 per cent, lost more than 75 per cent. To the loss of wages must be added the direct outlays of wage- earners for medical care. Of the 1,222 disabled by sickness 1,100 had ^ See Part II of this report, Special Report II. 16 sickness costs involving lost wages or direct outlays for medicines or medical treatment or both. Complete data obtained for 1,019 of these showed direct outlays aggregating $24,749-- as against an aggregate wage loss of $102,962. These figures would indicate that for every dollar of wages lost, 24 cents must be added for medicines and medical treatment, etc. The total annual bill estimated above at $46,000,000 for lost wages would be raised to more than $57,000,000 for lost wages and medical care of the wage-earners of the State. The total cost of sickness borne by wage-earning families is, of course, considerably larger than the figure just used, for to lost wages and direct outlays there included must be added the bills incidental to the sickness of dependent members of their families. The studies made of more than forty blocks in Chicago covered 2,589 wage-earning fami- lies,^^ who reported fully on disabling sickness and income. Seventeen hundred forty-four, or 67.1 per cent of these reported disabling sickness. Complete data were secured relating to the incomes, lost wages, and sickness outlays of 1,667 of these 1,744 families. Their total incomes amounted to $2,175,126, their total sickness cost (lost wages and outlays for medical treatment) to $163,340. The sickness cost was 8.3 per cent of their wages and 7.5 per cent of their incomes. The average cost was $97.98 per family. While it was impossible to secure accurate data relating to the total incomes and, in some cases, the total earnings of the 77 families report- ing disabling sickness but not included, in the 1,667 for whom the com- parisons have just been made, it was possible to secure data from most of them for wages lost and outlays for medical treatment. Combining the data relating to lost wages for 75 of these (2 not recorded) with those for wages lost by the 1,667, a total of $103,293 is obtained for the 1,742 families, or an average of $59.30 each. Assuming /he same average for the two cases not reported and spreading this wage loss over the 2,598 families here dealt with, the average loss because of disabling sickness recorded would be $39.80 per family. All told direct outlays were re- ported by 1,886 of the 2,598 families.^* Acceptable and complete details could be obtained for only 1,733 of these, but the partial details obtained for the other 153 indicated that the averages would be about the same for them as for the larger group. The total bills paid by the 1,733 to doctors, nurses, hospitals, dispensaries, and for medicines was $74,511, or an average of $43 per family. Assuming the same average for the 153 other families reporting some of their outlays and distributing the larger total over the 2,598 families studied the average would be $31.21 per family. This is, however, an understatement of tho outlay. Only 72.6 of the families studied reported any medical outlays; more intensive studies of household budgets have shown that 90 per cent or more have outlays for medicines and medical treatment. The Bureau of Labor Statistics, for example, has recently made a "cost of living*' study of 215 wage-earning families connected with the ship-building industry in Chicago. T he unpublished results show that 212 of the 215 families »Thl8 figure Includes the direct outlays of a considerable number who did not lose wages for as much as a week at any one time. *» The head of the family was a wage-earner. »*Of these 142 reported no "disabling sickness" of the kind here recorded 17 • studied had sickness expenses in the course of the year, the average for the 215 being $39.17.^^ Though these families were earning relatively high wages and had more money to spend, and though they did not have the same opportunity to secure free treatment that was open to most of those residing in the blocks studied by the agents of this Commission, a comparison of the results convinces us that the small imreported sums spent where there was no disabling sickness, would add $2 or $3, and possibly more, to the average arrived at in our investigation. Combin- ing lost wages and direct outlays caused by sickness, the total cost per wage-earning family can be reckoned as more nearly $75 than $70 per family for the wage-earning families studied in these Chicago blocks. This stands out against an average family income of $1,298, of which $1,215 was received in wages. It is probable that the cost of sickness for the wage-earning fam- ilies in Illinois in lost wages and direct outlays is between $80,000,000 and $86,000,000 per year.^^ This does not include a third element in cost, viz. loss of earnings caused by impaired efficiency. The estimates thus far made do not include funeral, dental and oculist bills. The total spent on 112 funerals covered by the Com- mission's studies of wage-earning blocks in Chicago was $14,833 or an average of $132.40 each. ^^ These studies show that dental work is greatly neglected by most families. In fact only 981 of the 2,598 fam- ilies, or approximately 37.8 per cent, according to their statements, had had any dental work done during the course of the year. Yet the total reported as spent by 918 families was $27,671, or an average of about $30.00.^^ The Bureau of Labor Statistics in its investigations to which reference has just been made found that the outlays for dental work, oculist services and glasses by 114 averaged $12.24 for the entire group of 215 families studied. The data obtained by the Commission's agents were tabulated for wage-earning families by groups on the basis of income plus wages lost by reason of sickness and need of income in view of the family composi- tion.^^ In class C were placed those families who could not meet a conser- vatively estimated charity, budget, in class B those who could meet such a budget but who had a margin over it of less than about 41 per cent, in class A those with a lars^er margin than this. It was found that the percentages of such families with disabling sickness were 76.0, 73.0 and 63.4 for classes C, B, and A respectively. Thus the less well-off ^ families on the basis of earnings unreduced by sickness were found to have a decided excess of sickness. It was found, moreover, that the "sickness costs" of families in class C were 14.9 per cent of their earn- 25 Two years ago the Bureau of Labor Statistics investig-ated the expenditures of 1.059 wagre-earning- families in Washing-ton, D. C. Of this total 922 had spent in the preceding- year an averag-e of $37.75 for medicines, medical treatment, etc. The average for 692 (in a total of 782) white families was $43.59; for 230 (in a total of 277) colored families $20.19. (See Monthly Labor Review, November, 1917, pp. 9 et seq.) 2« Figured for the entire State at the average cost found in Chicago, the total would be approximately $82,000,000. As has been stated, however, the smaller out- lays for medicines were not fully reported. '^ There were more deaths but the exact burial costs could not be secured in all cases. ^The others had free service or could not give the amount spent. ^For an explanation of this grouping see Part II, Special Report I, p. i85. —2 H I 18 ings from wages as against 8.5 per cent in the case of families in class B, and 7.7 in the case of families in class A. Finally, it was found that a relatively larger number of the normally less well-off families had loss of wages and direct outlays for medical care amounting to compara- tively large sums.^° Thus the distribution of the cost of sickness ap- pears to be decidedly unfavorable to those who in its absence are least able to meet a pecuniary burden. The full costs of sickness have not yet been presented, for to the lost wages and direct outlays must be added the free service obtained by many presumably because they were unable to pay for it. If to the wage-earning families dealt with above 242 otherwise occupied are added (making a total of 1,909), we find that 273 had free physicians' service as against 1,338 that paid for it; 122 free nursing service as against 91 that paid; 201 free hospital service as against 198 that paid hospital bills; 59 free medicines as against 1,533 that paid for them; 226 free dispensary treatment as against 143 that paid dispensary fees. Thus the doctors contributed their services in almost 1 case in 6, the nurses 4 cases in 7; the hospitals in more than 1 case in 2; those who provided medicines in 1 case in 27; the dispensary in almost 3 cases in 5. Illness has been found to give rise to deficits in many of the fam- ilies with sickness. Thus 290, or 16.6 per cent of the 1,744 wage- earning families with sickness, did not make ends meet as against 40, or 4.7 per cent of 854 without sickness who were involved in deficits. While in some cases, the losses due to sickness were small and would not alone account for the deficiency, in a large percentage of the cases the losses were substantial. Thus taking 83 class A families as against 16 whose sickness costs were less than $50 and 30 whose costs were less than $100, the costs were $100 or over in 53, $150 or over in 45, $200 or over in 37, $300 or over in 29, $400 or over in 22, and $500 or over in 16 cases. Taking 73 class B families with slight margins over necessary expenditures at all times as against 26 whose sickness costs were less than $50 and 39 whose costs were less than $100, the costs were $100 or over in 34, $150 or over in 23, $200 or over in 18, $300 or over in 8, $400 or over in 4, and $500 or more in 2 cases. Finally, taking 66 class C families whose earnings unreduced by sickness would not stand the test of a conservative "charity budget,^' as against 26 whose sickness cost was less than $50 and 40 whose cost was less than $100, the cost was $100 or over in 26, $150 or over in 20, $200 or over in 19, $300 or over in 11, $400 or over in 6, and $500 or more in 3 onsos. It must be borne *<> The details may be presented in the following- form : Percentage of families with sickness costs in class. .Hn««« Sickness costs in excess of — ABC ^JSS-^2 31.3 26.6 34.1 2JXJ0 16.6 12.3 17.9 JOOJO 11.2 7.0 8.4 400.00 60 41 f^n 500.00 ::::.:.:::: 3.6 I:? 3:4 The average costs for families, thus grouped, was as follows : Average loss of Average of direct Class. wages. outlays. Average cost. ^ $57.05 $45.68 $102.73 ^ 47.03 35.84 82.87 ^ 62.15 45.18 107.33 19 in mind that the sickness costs used for the above comparisons include not only the actual expenditures but also the estimated wage loss. They are designed to show the change from the normal situation caused by loss of earnings and medical outlays. The ways in which these deficits were met are significant. Data for 247 of the 290 show that 35 obtained $6,584 in charity ;2^ 64, $8,868 in loans; 37 used $7,305 from previous savings; 104 left bills unpaid amounting to $8,350; 32 used $4,938 received from insurance; and 14 met deficits to the extent of $2,168 in other ways. This indicates that by no means all the cost of sickness is met by the families visited by such misfortune. (5) Sickness and Changes in the Standard of Living; Sickness and Poverty. Sickness is a disturbing factor in the family life, frequently causing undesirable changes in standards of living and at times giving rise to the necessity of seeking charity in other forms than medical care. Changes in standards of living are difficult to ascertain and measure in investigations of the type made by the Commission's agents. In the great majority of cases they take the form of smaller expenditures for food, clothing, dental care, and the like, but these, while important, cannot be ascertained and set down in definite form. Some definite data were, however, obtained, and may be briefly presented. A tabulation has been made of the wage-earning families studied in working class districts in Chicago by what, foi' want of a better term, has been called "economic status." In class C are placed those who in any event have only a conservatively estimated poverty budget; in class B those who without reckoning out loss of wages and medical bills due to sickness, have a margin of not more than 41 per cent over the poverty budget; in class A those who without reckoning, out loss of wages and medical bills, have a margin of not more than 25 per cent over the maxi- mum for class B; in class W those who have more adequate incomes, loss of wages and medical bills left out of the account. This is a group- ing on the "normal" basis undisturbed by sickness losses and outlays. ^Taking the families thus grouped, it was found that a total of 343 out of a grand total of 2,598 wage-earninsc families were shifted to a lower class when loss of wage and medical bills caused by sickness were taken into consideration. The number of "W" families changed from 1.022 to 893 ; the number of "A" families from 665 to 644 ; the^number of "B" families from 631 to 686; the number of "C" families from 280 to 375. ^In the 343 shifts to a lower class, the disabling illness of normal bread- winner (the father) was assigned as the sole cause in 165 cases and as a part cause (in conjunction with the illness of other members of the family), in 43 additional cases. These data give some idea of the re- adjustments which had to be made in the absence of savino^s and with little insurance. So do the sums lost bv reason of sickness as indicated in the preceding section. Yet the shift to a lower class just indicated ^^ In this investig-ation 50 families were found to have been in receipt of charity in the course of the year. In six of these families there had been no sickness ; in 44 there had been, but 9 of these were among the 43 families for which complete data were not secured. 20 does not present the situation fully, for in a considerable number of cases members of families, until then unoccupied, took employment to make good, in part at least, the losses sustained. In their "block investigations" the agents of the Commission found 74 families in a total of 1,744 wage-earning families with sickness re- corded, in which the wife, or children under 16, or older children had gone to work because of the strain on family income produced by sick- ness. The ratio of 1 in less than 24 is no doubt an understatement for the positive evidence obtained was not complete. But taking the evidence obtained, 39 wives had gone to work, as did young persons 16 and over in 16 families, and children under 16 in 19 families. Fifteen other families had moved to cheaper quarters, while 20 had permitted insurance to lapse because of the strain produced by sickness. Investigations made elsewhere than in Illinois show that disabling sickness may be charged with about a quarter of dependency not cared for in almshouses and similar institutions.^^ The reports made to the Commission by charity organization societies of eight Illinois cities assign sickness as the chief cause of approximately one-third of all de- dependency in 1917-18. Our investigation of the data provided by Chicago charitable agencies for an eight year period indicates that physical and mental disability is designated in one-third to one-half of all analyzed causes and problems of dependency. The lower dependency ratio ascribed to sickness by other investigators was found to be due to the fact that their studies were made in years abnormal for poverty and dependency by reason of an unusual degree of unemplo^rment. Of the 2,708 wage-earning families covered by the "block studies" only 50, or 1.8 per cent, reported charitable assistance other than free medical and nursing care during the year. Checking this finding against other sources of information the estimate mav be ventured that somewhat under 2 per cent of Chicago wage-earning families, the lowest proportion in a decade, were recipients of material relief from the organized chari- ties of the City during the year 1917-18. As important as determining the percentage of dependency due to disabling sickness was the problem of ascertaining the tj^pe of physical and mental disability responsible for dependency. For an eight year period the United Charities reports that one-half of all physical dis- ability except that arising from accident is due to acute illnesses; the other half is due to chronic diseases about evenly divided between tuber- culosis and all other chronic disorders. The Cook County Agent assigns three-fifths of all physical disabilities aside from injury by accident to acute ailments, one-fifth to tuberculosis and one-fifth to other chronic diseases. The special investigation made (in 1918) by the Commission on the distribution of disabling sickness other than injury from acci- dent in the 628 charity families included in the family study found a much smaller proportion of disabling sickness of the type of acuta^ill- nesses.^^ The time of year (May and Jime) when the cases were selected *2 The whole matter of the relation between sickness and poverty and dependency has been studied intensively for the Commission by Professor E. W. Burgess. For a full analysis and statement of his results, see Part II of this report, Special Report I, Sec. V. '' See Part II, Special Report I, p. 257. 21 and the conditions of this special investigation were, however, largely responsible for the lower figure. Even if responsible for only two-fifths, rather than one-half or more of disability other than that caused by acci- dent, chronic diseases stand out characteristically as thj long time dis- abling type of sickness. One chronic disability alone, tuberculosis, is charged with one-fifth to one-fourth of all physical disability other than that arising from accident. The relation of sickness to the process of economic degradation was ascertained in two wavs. First, the normal economic status of the family for the year was determined by using as a basis the family in- come augmented by wages lost from sickness. Of the 608 charity fam- ilies reporting income in full the normal economic status of only 68 was in class A with moderate incomes; 139 in class B with meagre incomes, and 401 in class C with deficient incomes. The following table presents an interesting comparison between the normal economic status of the 2,708 wage-earning families in our block studies and that of the 628 de- pendent families which has a significant bearing upon the question of the relation of sickness to economic degradation. ,^ Number of families in — Per cent families in — Normal economic status. Block study. Charity study. Block study. Charity study. Class A with moderate income 1,687 631 280 110 68 139 L401 >k20 62.3 23.3 10.3 4.1 10.8 Class B with meagre income 22.1 Class C with deficient income ; 63.9 Class D income not reported 3.2 Total 2,708 628 100.0 100.0 Assuming that the wage-earning families in the blocks studied are fairly representative of the Avage-earning group in Chicago and that the families in the charity study are typical of dependency caused by sick- ness, the general principle of economic degradation may be formu- lated: — the effect of sickness as a factor making for dependency varies inversely with the level of the normal economic status of the family. The following statistical detail is significant in connection with the relation between sickness and dependency. The total number of persons in these charity families was 3,475; of these 1,546 were sick in the course of the year. Wage-earners were sick in 84.5 per cent of the families and the sickness of others added to the difficulty in more than two-thirds of these cases. Of the wage-earners losing a week or more of employment 450 reported completely in respect to earnings and lost wages. Their earnings aggregated $183,841; their losses of wages due to sickness $104,493, or 35.9 per cent of what their earnings would have been but for illness, and an average of $258 each. Of 450 losing working time, 279 lost more than one-fifth of the full time reduced possibly by unem- ployment for other reasons than sickness, 165 more than two-fifths, 136 more than half, and 63 three-fourths or over. Taking figures for charity families as a whole, of 408 reporting loss of earnings and direct outlays on account of sickness, the combined 22 • figure for these. was $100 or more in 258 cases; $200 or more in 183; $300 or more in 134; $400 or more in 91 ; and $500 or more in 57. The average in these 408 cases was something over $244 per family. Of this 85 per cent represented loss of wages, 15 per cent doctors' bills, hospital bills, etc., which totaled $14,899. There was, however, more free medical treatment in these cases than treatment paid for. As against 168 who paid doctors' bills, 247 had free service; as against 46 who paid hospital bills, 276 had free beds; as against 8 who paid some- thing for nursing care, 166 had free service; as against 19 who paid dispensary fees, 239 paid nothing; as against 210 who paid for their medicines; 80 paid nothing. The second method of measuring the extent to which economic degradation was caused by sickness was to determine the economic stand- ing of the family prior to the present cause ot distress. In 291 cases data were present in the records examined showing whether the family had been independent or dependent before the present occasion of dependency. One hundred forty-nine of these families were found to have been normally independent, and 142 famines dependent or in serious economic difficulty before the distress which resulted in the present dependent status. It should be taken into account however, that of these 142 families, (with 28 reports deficient and not tabulatable) 40 were known to have been dependent before on account of sickness. Thus in more than 1 case in 3 the earlier dependency was connected with sickness. Our investigation shows clearly how extensively the size of the family enters into the problem of poverty and dependency, complicating the relative weight of other factors, such as disabling sickness. The percentage of fapiilies with only one wage-earner and four or more children 14 years of age or under was in the blocks studied 9.7 per cent, in the 628 charity families 36.5 per cent. In the charity families it was found that large families of this type constitute 34.7 per cent of the families dependent because of accidental injury sustained by the normal breadwinner; 42.9 per cent of the families receiving charity because of chronic disability of the normal breadwinner; and 45 per cent of the families receiving relief because of acute illness of the normal bread- winner. What inferences are to be drawn from these different percentages? The basic fact stands out that the great majority of families with only one breadwinner and four or more children not over 14 years of age are already in poverty, just at the edge of dependency. An acute illness pushes the family into dependency because of its necessary '"hand to mouth" existence. Chronic illness depresses the family for long periods into the dcponrloncy status. (6) Some Illinois Vital Statistics. It was only recently that the reports of deaths became complete ' enough in Illmois for the State to be added by the Bureau of the Census to what is known as "the registration area."«* Hence the only reliable ♦»,. **7^^ rogrlstration area now includes states and parts of other states with c,nm^ thing less than three-fourthe of the population of - >oS^OOo5» lO 0> 1-H OSOSUOOSI+IOOCOOCCOCP -u >M ?,^t^ OS c^ Mo Fieooocc CD O OS rH 00 CO rH rH 00 u 2-2 "•5 CO CO Tt^ 0C(M COIM tH ta (id 03 1*^ OOi >» 4-^ ooo^ lo tH 1-H 03 (N lO 00* T-H (Nt^rHrHCOC4cJOC3od ^ § 1-H OS l-H O « 1-Hr-lM rH CO-H'fOO loCt^COCOlCCOOSINOO • ^H -l-J ?r,l^ 005 OICO CD t^ o i> OS t^ o6 Tf CO rH CO O CO CO -<»< rH rH 0» oTr-TcO^C^r r^ CO r— 1 CO CO 00 o CO CO "^ o a to t^ CO o> l5OrHrH00«000C^rHC0 a5 o • ■«^ c "5 »-( •i^ S^t^ 05 OlOCt^ f^ c^ Sf ® Tfl 0>- 03 03 (M CO C<1 !0 lOt^rHCOMOl^lOrH o C5 O ■* 00 COCOOsiO. cDCOOOi-nOrH . 03 p4idt>ii^ e*< Tf § « T-4 e3 1-H o S,"^ IMOJ(Mt-- 05COOSOiflT}10 CO t^ rH O ■«tl rH Tjl 00 OT OS 00 O O t^ (N rH rH 00 -4^ t>.T}l CO rH r<« ^® ■* •*! 00 05 W-H 00 1-H 2-2 O o a IN(M(N CO ^-^ c^ 1-H OltOCTi 00 tf T-i i-i > O ab ■* cot~ t^(M»OrH OOOrH(NC.Tt<^rHrHCOa5 1-H 2-2 e^ o>o>t^ +^ s! 03 00 1* OS CD t>C Tjl t>; Tj^ Tj? (M* (N rH O ^ 00 « 1-H rH 1-H 1-H o ® I-; ^OOsiO ofct^ooco ggJ2SS88S^^ hw MS >0 ■* t^ Tt< CO (M IM tM m s 2-2 •« •» ^ 1-H 1-H rH TiT 1-H OS 00 1-H rH '." 03 I'co o rr .^ •p-4 ;3 • 3 m .4^ m uj ■ +j •fH 03 • r^ "H « as 1 03 •fH Ih o o .d .4^ Lh J2 ■a § i > •-H o c > > 03 e o J ♦J CO ■5=5 « s oT o e 3 ii 2§ §-§ o « 03 « •o-l -a ■I.S U 03 CO C3 m P •rH S p 4 > -^ 03 u ca V. a "a c3 « 3 O U bi •— C O 3>< O S -a <*H M "3 03 26 (7) An increase in the death rate from heart disease from 7.11 to 16.3, or 129.3 per cent, so that it accounted for 11.2 per cent of the deaths in the last as against 3.5 per cent in the first five-year period; (8) An increase in the death rate from Bright's disease from 4.42 to 9.15, or 107 per cent, so that it accounted for 6.3 per cent of the deaths in the last as against 2.2 per cent in the first period; (9) An increase in the combined death rate for cancer, heart dis- ease and Bright^s disease from 15.82 to 33.99 or 114.7 per cent, so that the three accounted for 23.3 per cent of the deaths in the last as against 7.75 in the first period; (10) A decrease in the combined death rates from croup, diph- theria, scralet fever, measles and whooping cough from 21.32 to 6.4 or 70 per cent, so that they accounted for 4.4 per cent of all deaths in the last as against 10.45 per cent in the first period. A factor explaining the striking decrease in the number of deaths due to children's diseases and the striking increase in the death rates due to cancer, heart disease and Bright's disease is found in the change in the age distribution of the population. Between 1890 and 1910 the percentage of persons under 15 years of age decreased from 32.3 to 27.5; the percentage of persons 45 years of age or over increased from 13.6 to 17.3. It is evident, however, that these changes are after all a minor factor in explaining the decrease in the one case and the in- crease in the other. Just as the purification of the water supply and the improvement in the milk supply have effected a striking decrease in the ravages of typhoid and improved living conditions and perhaps the development of a degree of unanimity have decreased the death rate from tuberculosis, so has the control of communicable disease re- duced the death rates from the several children's diseases. Then, too, antitoxin has greatly reduced the number of fatalities from diphtheria. In these matters Chicago's experience eorresponds to that of the country at large as shown by the Census figures on mortality. No doubt the changes in Illinois as a whole have differed from those in Chicago only in degree. The fact is that the great reduction in the death rate has been due chiefly to the striking reduction in deaths of children; the reduction in the death rate among persons in middle life has not been nearly so great, while that among persons past fifty years of age has increased.*^ As has been said, "There has, unquestionably, not been the progi'ess in the control of the diseases of adult life which has been achieved in the prevention of the acute infectious diseases of infancy and early youth. If there has not been the alarming increase to which *° Dr. F. H. Hoffman in an article in the Journal of the Atnerican Institute of Homeopathy, Vol. X. pp. 1084-1096, presents the following table based upon the Census Mortality Statistics for 1910 and 1915 : Mortality in Registration States. Percentage Rate per 1,000 population. increase Ages. 1900. 1915. or decrease. 10-19 3.87 2.58 —33.3 20-29 -... 7.30 4.87 —33.3 30-39 9.10 7.04 —22.6 40-49 11.96 10.94 — 8.5 50-59 19.78 19.95 -\- 0.9 60-69 38.20 40.43 -{- 5.8 70-79 83.01 86.49 + 4.2 80 and over 193.39 190.64 — 1.4 All ages 17.12 14.27 —16.6 27 the attention is directed by those who apparently are not fully aware of the limited value or even the misleading nature of the statistics used there has certainly not been the anticipated decrease in the death rate which for humane, social and economic reasons would be of the first importance to the nation/^*^ Whether or not there has been an increasing or a decreasing amount of sickness accompanying the decreasing death rate has not been es- tablished by statistics. There is of course a close relation between the amount of sickness and the death rate. The death rate depends, however, upon the efficiency of medical and surgical treatment as well as upon the number who have serious illness. With the development of antitoxin the number of fatalities per 100 cases of diphtheria has been strikingly reduced; with the exercise of greater care and improvement in the treatment of tuberculosis no doubt fewer cases have been fatal; with more accurate diagnosis and better surgery the number of cases of recovery from appendicitis has increased ; and the same is true of a num- ber of other diseases. The decided decline in the death rate may have been accompanied by less morbidity. It is possible, however, that the amount of sickness has increased. (7) Conditions and Behavior Causing Disease and Death. The amount of sickness and the number of deaths are affected by many conditions and by personal conduct or behavior. These conditions may be grouped under working conditions, living conditions and com- munity conditions. Save for an investigation of "The Health of Illinois Coal Miners'' by Dr. E. E. Hayhurst,*^ the Commission has made no special investigations of these matters in Illinois. In stating the problem in its relations to conditions and behavior, use will be made of data drawn for the greater part from other sources. W^ork with harmful substances, work under unsanitary or other harmful conditions, and perhaps fatigue give rise to an excessive amount of sickness and increase the number of premature deaths. In some instances specific cases may be definitely and directly traced to the materials worked with or to certain conditions in the place of work. Such is occupational disease — lead poisoning, arsenical poisoning, anthrax, caisson disease and the like. In Great Britain twenty-eight of these occupational diseases have been brought under the Workmen's Com- pensation Act. Occupational disease presents an important problem; yet in California and Massachusetts the number of occupational disease cases compensated under the workmen's compensation laws has been very small as compared to the number of accidents compensated, and still smaller as compared to the number of cases of disabling sickness."*^ The reason why so few cases are compensated in these states is found in the difficulty involved in establishing a direct and immediate relation in the individual case between the specific disease and the nature of the work or the conditions under which it is done. Conditions connected " Quoted from Frederic H. Hoffman, "Is the Increasing Death Rate from the 'Degenerative' Diseases Imaginary?," in Journal of the American Institute of Home- opathy, Vol. X, p. 1095. " See Part II, Special Report V. " See Part II, Special Report IV, and Special Report XVI. Special Report IV is a stimmary statement of Occupational Disease in Illinois, by Dr. Alice Hamilton. 28 with the gaining of a livelihood do not record their results in recognized occupational disease alone. There is fairly general agreement that this is true. Unsanitary conditions (dirt, dust, dampness), bad lighting, bad ventilation, excessive heat and cold in the place of work record their effects upon wage-earners.** To what extent these are found in Illinois the Commission has not ascertained by investigation. These conditions are covered by legislation and it is a matter of common knowledge that they have shown considerable improvement during the last ten years. An increasing number of establishments maintain their own inspection departments to secure sanitary conditions. Yet it can neither be said that there are no laggards in improving the hygiene of work places, nor be claimed that the best that sanitary science has to offer has found general application in practice. A survey made for the State Board of Health in Ohio in 1914 showed exposure to the hazards mentioned above, and classified as "bad" from the standpoint of sanitation and hygiene, in a considerable number of the industrial establishments in- spected.*^ Investigations in New York and Louisiana have shown similar results. Sanitary surveys made for the Commission on In- dustrial Relations by the United States Public Health Service in ten typical industries in seven different states, among them Illinois, are said to have shown "that conditions were about the same as those reported for New York, Louisiana, and Ohio.''*® Fatigue, due to the accumulation of waste products within the system called fatigue poisons and fatigue toxins, is said by some to be one of the most common causes of occupational disability. It is claimed that it may cause "anemia, enlargement of the heart, increased blood pressure, circulatory diseases, kidney disease and neurasthenia or nervous exhaustion."*^ Fatigue may be caused by many things in industry — standing at work, strained positions, noise, monotony of work due to specialization, unusual concentration of attention, speed induced by piece work or otherwise, long hours per day or the seven day week^ alternate night and day work, etc. Of these speed on piece work and long hours are perhaps of most importance. The physical examination of garment workers in New York, conducted by the United States Public HealtH Service, showed more frequent overstrain on the part of piece workers than on the part of those otherwise paid.*^ The Industrial Survey Commission of this State has recently (1918) made an investigation of the relation between health and the hours of employment of women. A number of industrial physicians in their communications to this Survey Commission, stated that long hours and standing while at work give rise to certain complaints, which in some cases were set out in detail.*® A statistical investigation of work accom- **The importance of these in their relation to disease h>as been discussed in many places. For a full discussion, see Industrial Health Hazards and Occupational Diseases in Ohio, by E. R. Hayhurst, 1915. *^ See Hayhurst report, cited above, p. 118 for summary table. *«U. S. Public Health Service, Public Health Bulletin, No. 76, p. 10. "Hayhurst report, cited above, p. 36. *• See U. S. Public Health Service, Public Health Bulletin, No. 71, p. 79. « See Industrial Survey Commission, Repoit, Ch. III. By courtesy of the Survey Commission this Commission has had an opportunity to examine the question- naires filled out by the industrial physicians. 29 plished as an index of fatigue showed in some instances a smaller product from the longer day or longer week.^^ Finally, enquiry of employees brought most frequent complaints of fatigue and disability from those working the longer hours. ^^ Hence the Commission recommended a law limiting the employment of women in most occupations to 8. hours per day and 48 per week.^" The Commission reached its conclusions "Almost entirely on the basis of its belief that its investigations show that longer hours than eight per day or forty-eight per week t^nd to produce harmful physiologic, or perhaps it would be better to say pathologic, fatigue in women workers.^^ The investigation to which reference is made was limited to the work of women. Of those reported, 29.2 per cent in Chicago, and 68.7 per cent outside of Chicago worked nine hours or more per day. Though the womert are under certain physical handicaps as compared to men, there is reason to believe that a similar investigation of the hours of employment of men would have shown some relation between hours, fatigue and health. That there is a relation has been indicated by in- vestigation.^* To what extent the hours of employment in Illinois are a cause of ill health among men this Commission is unable to say. No investigation has been made and the (State) Department of Labor has in recent years published no data relating either to hours of employment or wages in the State. Recognized and definitely established occupational diseases ar6' traced directly to their cause. The occupational factor in other cases can be established only by records and statistical tabulation. If the re- sults of such work are to be properly used they must be set out in full detail so as to be made comparable and sufficient space is not available in this report for that purpose. It may be said, however, that mortality statistics show higher death rates among wage-earners than among the proprietor and professional classes. ^^ They show excesses of different (fatal) diseases in different occupations — e. g. tuberculosis among clerks, bookkeepers and office employees; pneumonia among molders, coal- miners, and teamsters ; cirrhosis of the liver among saloon-keepers and bar-keepers.^^ They show, also, great differences in death rates by occupation. ^^ In view of this fact the insurance companies writing group life insurance take the occupational hazard into consideration.^^ So do the casualty and assessment companies in writing health insurance. Of course persons in poor health may be attracted to certain occupations (e. g., the tuberculous to light office positions). To the extent that this ^ See report cited, Chi V. ^^ See report cited, Ch. IV. 52 The report and recommendations were signed by five (the three physicians and the two representatives of labor) of the seven members. A minority report was presented by the two representatives of employers. °' Report cited, Introduction, p. 10. " See, e. g., Reports by British Health of Munition Workers Committee, pub- lished by U. S. Bureau of Labor Statistics, Bulletin 230, especially pp. 42-70. It has been claimed that the 8-hour-day has been a very important factor in the remarkable reduction of the death rate among members of the Cigar Makers Union. ^ See, e. g., Pamphlet on Consumption and Preventable Diseases in American Occupations, by Ohio State Board of Health (1914), especially p. 8. ^^ For a valuable study of this subject, see Dublin, "Causes of Death by Occu- pations," U. S. Bureau of Labor Statistics, Bulletin 207. 5' See "Joint Mortality Experience of the Aetna and the Travelers Insurance Companies on Group Policies," by Cammack and Morris, in Transactions Actuarial Society of America, May 1918, pp. 29-52. 30 is true statistics mislead. Yet there can be no donbt that the conditions under which men work have an importance beyond the relation they have to recognized occupational disease. Only those gainfully occupied, about two-fifths of the entire popu- lation, are directly affected by the working conditions described. All are affected by "living conditions.'^ It is a matter of common observation and common knowledge that the diet of most persons is not as good as their financial circumstances permit. Some of the industrial physicians and school authorities em- phasize the importance of improved diet in relation to health and efficiency in work or study. Though it has not been accurately measured, it is generally pre- sumed that there is a close relation between housing conditions and disease. Bad plumbing, poor ventilation, dirt, insufficient light and overcrowding may undermine health and spread disease. In the absence of effective control much of the housing in Illinois falls short in these respects. An extensive survey of housing conditions in Chicago has recently been made in connection with the Health Department's Tuberculosis Survey.^* The survey of tuberculosis covered eight square miles of Chicago's most congested territory. The Commissioner of Health may be quoted with reference to the housing conditions found. In his report^^ it is stated, "In order to arrive at some idea as to the sanitary conditions of premises, reports were asked as to plumbing, ventilation, garbage collection and general cleanliness. Our reports show that in 72.6 per cent of the 13,309 cases recorded the plumbing was considered good, in the remainder bad; in 66.2 per cent of 13,937 instances the ventilation was indicated good, in the remainder bad ; in 84.3 per cent of 13,604 instances considered the garbage disposal was reported good, in the balance bad; while in 63.5 per cent of the 12,913 instances tabulated the conditions as to general cleanliness were reported as good and 36.4 per cent as bad." An intensive survey of housing was made to ascertain the relation between housing and tuberculosis. While no definite relation was es- tablished, numerous cases of insufficient li^ht and air, and of small rooms and overcrowding were found. The light was reported as *Vretched in fully 20 per cent of the 10,100 rooms where the spaces were measured." A total of 43 per cent of the 10,100 rooms were found to be deficient in respect to the "amount of open space that is a part of the same lot on which the house stands." In a large proportion of the cases the bedrooms contained less than 80 square feet, the legal requirement since 1910. Indeed, of 5,000 measured, only 34 per cent met or exceeded this standard; 17 per cent had between 70 and 80 square feet; 19 per cent, between 60 and 70; while 28 per cent fell below 60 square feet. In this connection it is stated that "Few cities in America ca n show bedrooms as small as these in Chicago. It is doubt- "See City of Chicago Municipal Tuberculosis Sanitarium. Annual Report, 1917 Numerous other studies of housing? conditions have been made in Chicago and other cities. Among these reference may be made to the Springfield Survey (1914), and Hotismfj Conditions in Chicago, by Edith Abbott & S. P. Breckinridge **' Sanitarium Report cited above, p. 108. 31 ful whether any city can show one-quarter of the number of small bed- rooms that, are to be found here."^** In a large percentage of cases overcrowding was found. The test applied in this case was two persons per room. Though the situation is reported as better than prior to 1914, in 3 of the 22 blocks more than 25 per cent of the apartments housed more than 2 nersons per room. In five blocks the percentages of overcrowded apartments varied from 16 to 25; in all but one the percentage was above 8. Indeed, in one block 20 per cent of the apartments housed 3 or more persons per room ; the percentage of 8 other blocks ran from 7.5 to 14.^^ In a large percentage of cases small bedrooms were occupied by 3, 4 and 5 or more persons.*'^ Other studies have shown that this situation is met with in other parts of Chicago.^^ The Springfield Survey showed that that city was not without a housing problem. Hayhurst reports that while in one or two mining communities investigated the houses of the miners were ^'^model in regard to building construction and arrangement and upkeep, and while the men in a few other communities are not poorly housed, the great majority of the mining centers present a housing problem."^* Bad water, bad milk and impure food, dirty streets, poor sewage disposal, and poor control of contagious diseases are important causes of disease. Chicago has reduced typhoid fever annuo t lu the minimum by introducing a good water supply and treating the water when neces- sary.^^ The milk supply is pasteurized, though at outside stations. In many parts of the State neither of these necessaries of life has been brought under proper control. In most parts of the State in the ab- sence of proper medical inspection of school children and quarantine regulations, the spread of contagious diseases is not properly protected against. In fact except in Chicago and a comparatively few of the other health districts of the State, sanitation and health administration are sadly deficient — a matter discussed in a later section of this report.^^ Community neglect and high sickness and high death rates go hand in hand. There is a close relation between low family incomes and sickness and premature death. It has been said, '^the fact is poverty is the great- est problem in public health."^'' This poverty may be due to the dis- ruption of families by the death or desertion of the chief breadwinner, to old age or incapacity, to large families, to unemployment, or to low wages — as it very frequently is. But whatever its cause, in the absence of property to fall back on, it means inadequate food, poor housing, insufficient clothing, and poor medical care. It means continuing at work when rest and recuperation are needed. If due to lack of employ- ment, this adds worry, nervous strain and perhaps irregular living. «• Report cited above, p. 145. '1 Report cited above, p. 144. "2 Same reference, pp. 146-147. ^ See Housing Conditions in Chicago, by Edith Abbott and S. P. Breckinridge. " See Part II of this report. Special Report, VI. See "Control of Typhoid Fever in Chicago," by Heman Spalding, M. D., and Tkq^^J^ Bundesen, M. D., in American Journal of Public Health, May, 1918, pp. ^ See Chapter II, below. 1- -J^ Si^,?^,?*^ ^"^^"^ Warren and Svdenstricker. "The Relation of Wages to the Pub- lic Mealth, American Journal of Public Health, December, 1918, p. 883. 32 Numerous investigations have been made of the amount of sickness in relation to family income or wages. All of these investigations have shown that low wages and inadequate incomes are accompanied by an excessive amount of sickness. Of course the question may be raised whether the low wages may not be caused in many cases by poor physi- cal condition attended by frequent illness. The question raised must be answered in the affirmative. Yet it is true that low wages and in- adequate incomes undermine the health of both the worker and his de- pendents. As already indicated, the investigations made for this Commission showed that there is an excessive amount of sickness among the families with the smallest incomes relative to the need of income to provide the necessaries of life. Among the wage-earning families best off in this respect disabling sickness occurred in 63.4 per 100; among those less well off, in 73.0 per 100; among those least well off, in 76.0 per 100. These results are confirmed by the findings of other investigators. "Sydenstricker working in the Pellagra investigations of Goldberger in seven cotton mill villages in South Carolina, kept an accurate record of all of the cases of disabling sickness found among a population of 4,000 in May and June of 1916. A tabulation of these records according to family income showed that among persons of similar sexes, ages, and occupations, the sickness rate per 1,000 varied from 18.5 in the highest class to 70.1 in the lowest income class.^^®^ An excessive number of cases of tuberculosis, anaemia, and poor nutrition were found among the most poorly paid workers in the garment industry of ISTew York.^^ It is stated in the report on Vital Statistics made by the "Framingham Survey," that "the less prosperous districts (of the city) have markedly higher death rates, and markedly higher rates from the chief causes of mor- tality, a fact which indicates the importance of the economic factor and the need for special effort in disease preventive work in poorer dis- tricts."^° The reports of the Health Department of the City of Chicago show the greatest prevalence of children's diseases and the highest death rates in the most congested parts of the city and where the number of families with small incomes is relativelv larare.'^^ The most intensive investigation of children's diseases has, however, been made by the Children's Bureau of the Department of Labor. Several investigations have been made; and similar results have been arrived at. The infant mortality rates by fathers' earnings may be quoted from the Baltimore investigations, the largest of the several thus far made.''^ Inadequate incomes undermine health. Moreover, they may cause persons of immature years and mothers to enter employment. Em- ployees of tender years increase the sickness hazard in industry.''^ The investigations by the Children's Bureau have shown that the gainful «• Warren and Sydenstricker, cited above, p. 887. «»U. S. Public Healtb Service, Publw Health Reports, May 26. 1916. '•> Framin^ham Health Demonstration, Monograph No. 3, p. 23. " See Chapter II of this report "Table quoted from Woodbury. "Infant Mortalitv Studies of the Children's Bureau," Quarterly Publications of the American Statistical Associatio7i, June, 1918, p. 38. This paper summarizes a number of the statistical investigations of the Bureau. " See Hayhurst Industrial Health Hazards and Occupational Diseases in Ohio, p. 8, et seq. 33 employment of mothers, whether because of the lure of good wages or because of the necessity of assisting in the support of the family, is ac- companied by a higher sickness rate and a higher death rate among in- fants, partly because of the necessity of artificial feeding. 74 INFANT MORTALITY RATE BY FATHERS' EARNINGS. Earnings of father. Infant mor- tality rate. Live births. Deaths. All classes Under $1.50 $450-1549 $550-$649 $650-$849 $S50-$1,049 $1,050-$1,249... $1,25(}-$1,449... $1,450-81 ,849... $1,850 and more No earnings Not reported... 103.5 156.7 118.0 108.8 96.0 71.5 66.6 74.0 86.3 37.2 207.7 140.2 10,797 1,544 1,449 1,489 2,417 1,595 661 419 371 431 207 214 1,117 242 171 162 232 114 44 31 32 16 43 30 Finally, the factor of the individuaFs behavior must be emphasized because the violation of the dictates of common sense in eating, drink- ing, sleeping, dress, recreation, sexual relations, and much else is of frequent occurrence and gives rise to excessive sickness and death rates. That this is true is a matter of common knowledge and requires no further comment. (8) Responsibility for Sickness and Premature Death. Numerous causes of sickness and premature death have been set out and commented on in the preceding section. The analysis indicates something with reference to responsibility for the problem, but it does not go far in enabling one to measure the degree of responsibility. The responsibility must in most cases be divided among the individual, the community and industry ; the share of each is no small one. Occupa- tional diseases can be charged to industry; typhoid and contagion may be charged to the community; perhaps the individual should be charged with responsibility for venereal disease. Most diseases, however, cannot be traced to a single definite source. The share of the cooperating factors cannot be measured by known methods of investigation. If it could be and low wages were found to be responsible for half the sick- ness, who could say that low wages are the fault of the emploj^er, the wage-earner, or the community, or, for that matter, are to some extent unavoidable ? (9) The Prevention of Sickness and Premature Death. The data presented in the preceding sections raise three related, yet distinct questions : ( 1 ) To what extent can physical defects be remedied? (2) To what extent can disabling sickness be prevented? (3) To what extent can death be postponed by preventing disease or by more successful treatment of illness Avhen it occurs? This discussion "-See Infant Mortality Studies, Bulletins 9 and 20. —SHI 34 of the problem of sickness and death may be closed with some obser- vations bearing upon these questions. It is evident from the data collected that many wage-earners and many school children have physical defects which may impair their efficiency and which frequently reduce resistance to disabling disease. In the opinion of industrial physicians many of the defects found among wage-earners, even among those rejected for emplo}Tnent, may be remedied. Similarly many or a large percentage of the defects among children can be successfully treated, the efficiency of the children in- creased, and the seriousness of sickness among them in later life reduced. Frequently the ravages of a disease are increasingly overcome by nature. The extent to which we can prevent sickness depends upon our knowledge of causes and our ability to eliminate or to control them. Of the possibilities of preventing sickness and postponing death there has been much discussion in print' ^ and at the Commission's hearings and conferences. Though estimates have been made of the number of affections and of premature deaths which might be avoided, the dis- cussions are for the greater number theoretical, and there is after all a great difference of opinion among those medically trained. Brend, in a review of what we know about the causes and the efforts to control the spread of many important diseases, questions much that has been said and cautions against premature generalization.'^*' What is here presented will be limited to some observations concerning the extent to which, in the light of experience, certain important diseases can be prevented or their spread controlled. The more important of the "children's diseases" may be noted first of all. In the registration area in 1916, 32.5 per cent of the deaths of children under 10 years of age were caused by measles, scarlet fever, whooping cough, diphtheria, croup, poliomyelitis, and diarrhoea and enteritis. In Illinois in 1917-18 there were perhaps 17,500 cases of measles, 7,500 cases of scarlet fever, 42,000 cases of whooping cough, 15,000 cases of diphtheria, and 1,600 cases of poliomyelitis — nearly all of them among children.^' With diphtheria excepted, the only effective control of these diseases is by isolation of those affected to prevent them from spreading to others. In the case of diphtheria, antitoxin has reduced the death rate perhaps to a quarter of what it was twenty years ago. Antitoxin is furnished free by the State and is (and has been) widely and successfully employed in protective immunization as well as in the treatment of cases. More important as a cause of death, however, than all of these communicable diseases are diarrhoea and enteritis. The death rate from these, and presumably the amount of sickness also, is far above the normal in Chicago and perhaps in the State as a whole. There is every reason to believe that with more proper T5 n^ AT^N^^^; T/TJ f V ^ r^°°S' ^}^^^^ V^^^y quoted discussions are : Fisher, Report S.nn^tr«?ron -^^I'^U'J^^ Y''%1^%.'''',^ ^''''^^''''''i'^'^ ^ Thte Framingham Health De- ^,c,^^frfV^^ V^^^^^-^^P^^^'t,^^^*^*^^ Examination Campaigns j and National In- S PreSfonr^ ' ^^^^^^^^ ^^P°^t Number 6, iick^iess Insurance orSiSc- book ?nmied' HeSlf^LTtTr^Ze":' '""'^ "^""^^ ^" ^^^ «^^^ «^^ ^^^P*-« °* ^'^ " The Illinois figures for deaths and the estimated number of cases of communi- cable diseases are taken from or based upon ratios found in the report of thT De- partment of Public Health, cited above, pp. 469 and 487-491 ^^^^^^ ^^ i^^e ue 35 ^ feeding and better care the number of cases can be materially reduced.'^® Of the other diseases accounting for approximately two-thirds of the deaths among children many can be likewise reduced by infant welfare work and better care. Experience shows that a great reduction can be made in the amount of sickness and the number of deaths among children;' by the application of the knowledge we now have. Among married women death in child-birth is important. In ; Chicago the number of deaths per 1,000 births is between 5 and 6. Experience shows that by organized care the nuniber can be reduced to less than 0.5 per 1,000.'^ The same conditions causing an excessive death rate among parturients leave many other mothers disabled or in such condition that they become more frequently disabled from other causes. Considering communicable diseases other than those already men- tioned , there were in Illinois in 1917-18 perhaps more than 5,800 cases of typhoid of which 581 were fatal. Typhoid is a most serious illness and last year (1917-1918) w^as responsible for 0.65 per cent of the deaths in the State. The death rate from it in Chicago (with 46 cases) was only 1.8 per 100,000 population; the corresponding rate in the rest of the State (with 535 cases) was 14.4. Preventing typhoid is chiefly a question of providing proper sanitary arrangements, good water and p "safe^^ milk, and of controlling carriers, and with equal safeguards the disease should become almost as infrequent elsewhere as in Chicago. It can be almost eliminated. Preventive inoculation is also efficient. Malaria, w^ith perhaps 23,000 cases and 115 deaths, is important only in the southern part of the State and with the application of well- known methods can be practically eradicated. With vaccination of many school children and a considerable num- ber of employees and, perhaps, with a tendency toward immunity against it, small-pox has ceased to be of much importance. It has been brought under effective control in most parts of the State so that there were only ; 15 deaths from it last year. Tuberculosis ranks first as a cause of death in Illinois: it is esti- mated that there are more than 75,000 active cases of tuberculosis in some form or other in the State. The death rate from it has decreased in the more advanced countries. Most of this decrease took place be- fore any campaign was made against it, but there is reason to believe that a further and very material reduction can be effected.^^ ^ Pneumonia (always) and influenza (recently) have been among the ■ most important causes of disabling sickness and death. As we have seen, a generation has witnessed no decrease in the death rate from : pneumonia in Chicago, and it would seem that except by proper care on the part of the individuals and isolation of those afflicted by it, very - little control can be exercised over it. The ravages of influenza have at times been very great; it caused approximately 1.8 per cent of the deaths in the registration area in 1916. During the recent epidemic the amount expended in sickness benefits by some sickness funds increased " See Chapter II, Section 8. " See Chapter II, Section 7. **For a fuller discussion of this, see Chapter II, Section 4. 36 200 and even 300 per cent over the normal for autumn months. More numerous disabilities from other afflictions may be expected to follow in its train. Its cause is not definitely known, and physicians and health officers are experimenting with various methods of prevention and con- trol without as yet obtaining any certain result. Venereal diseases are of frequent occurrence among adults and by transmission become an important cause of disability and death among children. Syphilis in its later manifestations as in the nervous and vascular systems ranks high as a cause of death among adults. By careful control of vice and by the reporting and treatment of cases there is reason to believe that a very great reduction, in venereal diseases can be effected.®^ These diseases, some preventable in a large measure, others sub- ject to control only within narrow limits, are important causes of disabil- ity. It would appear, however, that they are responsible for only the smaller part of the sickness disabilities among wage-earners. Con- sidering the disabilities among employed adults, of most importance in connection with some of the problems the Commission has to consider because such disabilities involve loss of earnings, reference may be made to the morbidity experience of a group of establishments presented above.®^ It cannot be said that this experience covering twenty manu- facturing plants, a sales force, and an office force for the years 1915- 1917, is entirely typical. The relative importance of causes of dis- abling sickness is affected more or less by the rejection of approximately five per cent of the applicants for work because of affections of various kinds. Moreover, venereal and other diseases due to misconduct are not compensated, and therefore do not appear in the records of compensated cases here used. Using the morbidity experience of this group of establishments as the best available to the Commission, it is to be noted that measles (32 cases), pneumonia (180), tuberculosis (146), and tvphoid (34), account for only 392 or 4.76 per cent of the 8,243 disabilities due to disease and lasting seven days or more and compensated under the in- surance organization maintained. It is safe to say that the majority of these and of the 1,124 cases of disability due to colds and grippe are not preventable with known methods of control. The "degenerative" dis- eases — cancer, heart and Bright' s disease, so important as causes of death, totaled 200 or 2.4 per cent of the 8,243 cases. There were, also, 236 cases of appendicitis and 106 cases of disabling hernias, which, though they may be remediably treated, are not in any large degree preventable. Second most numerous in the list, with 1,225 or 14.9 per cent of the total of cases, are bronchitis and pleurisy which have been set down as "doubtfully preventable."^^ The largest - number (1,261) of cases of disability were due to rheumatism,®* some forms of which are pre- ventable, others less subject to control. The other cases specifically recorded included abcesses, infections and inflammations (605), diseases of the blad der and kidneys (132), affections of the eye, ear, nose and " See Chapter II. Section 5. " See above p. 14 where the table here commented on wiH be found. ~Frammgh-am Health Demonstration, Monograph No 4 p 21 »* "Rheumatism" as a diagnostic term is often loosely used :' many painful affec- tions of obscure character are called "rheumatism." many painiui anec 37 throat (871), diseases of the stomach and intestines (867), and varicose veins and ulcers (77) — a total of 2,552 or 36.0 per cent of the 7,096 specifically recorded. Most of the ailments thus grouped are prevent- able in greater or lesser degree. For the most part (tuberculosis and diarrhoea and enteritis are exceptions) these observations have been made with the assumption of no radical change in working conditions, wages, living conditions, and personal hygiene. Radical changes in these — in the environment — might be expected to increase the power of resistance to disease and to effect a material reduction in the number of cases of disabling sickness and death. The observations made are sufficient to indicate some of th^ limitations in solving the problem of sickness by prevention. At the same time they indicate some of the possibilities of prevention which will be discussed in the next chapter of this report. 38 CHAPTER II. COMBATING DISEASE AND CONSERVING HEALTH. The analysis of the problem of sickness and death and the discussion *of the extent to which these misfortunes might be prevented and efficiency maintained leads naturally to the question, What is being done in Illi- nois to combat disease and to conserve health ? • (1) State Legislation Designed to Improve Conditions and to Conserve Health, The General Assembly in recent years has enacted numerous laws designed "to improve the conditions under which people Vv^ork, to safe- guard the food and water supply, and to improve conditions in lodging houses and taverns. Important among the laws of the first class are the "Garment Law" (1893), the Blower Law (1897), the Structural Law (1907), and Health, Safety, and Comfort Act (1909, 1915), the Occu- pational Disease Act (1911), the Women's Ten Hour Law (1909, 1911), and the Wash House Law (1913). Important among the laws of the other classes are those reMting to the inspection, adulteration and serving of food, the handling of milk, the inspection and sanitation of lodging houses and taverns, and the prohibition of the use of the common drink- cup. To these should be added, also, the law (1915) requiring that pro- vision shall be made for physical education and training in the schools. Inasmuch as the provisions of these laws are easily found in two com- pilations — (Illinois Department of Labor, General Information and Laws, effective July 1, 1917, and Illinois Department of Public Health, General Information and Laws, effective July 1, 1917) it is unnecessary to detail them here. The two noteworthy gaps in the legislation now in effect are found in the absence of any state legislation relating to the medical examination, nursing care and clinical treatment of school children and the absence of a building code. Mandatory or permissive laws relating to the health supervision of school children are now found in no fewer than twenty-five of the states.^ Likewise much state legis- lation setting standards in the erection and care of the places in which people shall live has elsewhere accompanied the setting of standards with reference to the conditions under which they may ^vork. For reasons already stated, this Commission has not made any inves- tigation of the administration and operation of the legislation mentioned and now in effect in this State. Reference is made to it merely to indi- cate how far legislation has been enacted. » See Part II of this report, Special Report XIII, for an analysis of this legis- lation and a statement of the existing situation in Illinois. 3^ (2) The Department of Public Health. First to be mentioned among agencies for the combating of disease and the conservation of health is the State Department of Public Health. Within the limits of the powers conferred upon this department by statute, it is a well planned, well organized and efficient department and compares favorably with the better departments or boards in other states. Though handicapped by a comparatively small appropriation ($220,000 per year), it is undertaking an important work in coordinating and standardizing the public health service of the State. Beginning only about 50 years ago, state boards and departments of health have had numerous judicial, legislative and executive powers con- ferred upon them in an effort to solve the problem of disease and to attain higher standards in public health service. The former Board of Health of this State and the present Department of Public Health are no exception to this rule. Yet a comparative analysis of legislation shows that the tendency to centralize power in the hands of this branch of the state machinery has proceeded less far in Illinois than in a number of the commonwealths. Among the general powers conferred and the duties imposed upon the Department of Health are: To have general supervision of the health and lives of the people of this State; To advise relative to public water supplies, water purification works, sewerage systems, and sewerage treatment works; To exercise supervision over water and sewerage nuisances and make and enforce rules and regulations relative to the same; To conduct sanitary investigations when deemed necessary for the preser- vation and improvement of public health ; To investigate nuisances and questions affecting the security of life and health in any locality in the State ; To maintain chemical, bacteriological and biological laboratories; To conduct examinations of milk, water, sewage, wastes and other substances ; To diagnose diseases w^hen deemed necessary for the people's protection; To purchase and distribute to citizens of the State, free of charge, diphtheria antitoxin, typhoid vaccine, smallpox vaccine and other recognized sera vaccines and prophylactics; To obtain, collect and preserve useful information relative to mortality, morbidity, disease and health; To investigate the causes of diseases, especially the causes of mortality, the effect of localities and other conditions acting upon public health; To keep informed of the work of local health officers and agencies; To assist local health authorities or agencies in the administration of health laws; To promote the information of the general public in all health matters; To enlist the cooperation of physicians' organizations and other health agencies in the improvement of health and sanitary conditions; '40 To make sanitary, sewage, health, and other inspections and examin- ations for the charitable, penal and reformatory institutions and nor- mal schools; To inspect all hospitals, sanitary and other municipal institutions and ^ report their conditions and needs to the authorities having juris- diction ; And to print, publish and distribute documents, reports, bulletins, cer- tificates relating to the prevention of disease, health and sanitary conditions. The Department also succeeded to the powers of the former Board of Health except those relating to the practice of medicine, midwifery and the regulation and examination of embalmers, which are now in- cluded in the duties and powers of the Department of Registration and Education. Among these powers are those To declare, enforce, modify and relax quarantine; To prescribe rules and regulations for sanitation; To regulate transportation of the remains of deceased persons ; To investigate the cause of dangerously contagious or infectious diseases, especially when epidemic; To take proper measures to suppress dangerously contagious and in- fectious diseases that have become epidemic and when local author- ities have refused or neglected to act promptly and efficiently; To inspect all lodging houses, boarding houses, taverns, inns and hotels in cities of 100,000 inhabitants or more (Chicago only) to see that the law (1899) relating to the same is complied with; To prescribe rules for the distribution and sale of diphtheria antitoxin ; To care for the registration of births and deaths; To provide all obstetricians with a prophylactic for ophthalmia neona- torium ; To formulate sanitation rules for inns, hotels, or public lodging houses; To approve sanitation rules and regulations for barber shops adopted by the Department of Registration and Education; To prepare blanks for the reporting of occupational disease ; To select an institution for the treatment of poor persons suffering from rabies.^ The Sanitary Health Districts Act (1917) requires, also, that the department shall conduct competitive examinations for health officers to serve in such districts when organized. Such are the more important powers and duties of the Department of Public Health. It will be noted that for the greater part they are investigative and advisory in so far as sanitary matters and the personnel of the local health administration are concerned. It has supervision over water and sewerage nuisances and is to advise relative to public water supplies, water purification works, sewerage systems, and sewerage treatment works; unlike the corresponding departments of Wisconsin, Ohio and fifteen other states, it is not vested with power of approval of plans for water and sewerage systems. In New Jersey and New York » For the above, see Illinois Department of Public Health ; General Information and Laws, effective July 1, 1917. 41 the corresponding departments are empowered to determine the qualifi- cations of local health officers for appointment; in several states the appointment of local health officers is vested in the State Board of Health; in several states local health officers may be removed by the State Board; in Ohio appointments of health officers in villages must be approved by the State Board of Health; a good share of the local health work in Pennsylvania is done by representatives of the State Board; but in Illinois the Department of Public Health has no clearly defined authority in local health administration except in epidemics; it has nothing to do with the appointment or removal of local health officers except under the act of 1917 relating to the formation of a new type of public health district, where it is to hold examinations and certify a list of eligibles from which the health officer of any such district is to be selected.^ For doing its work the Department of Public Health has organized ten divisions besides the executive, and to assist in the control of com- municable diseases and serve in an advisory capacity to local health officers it has established six health districts with a full-time health officer in each. An enumeration of these several divisions (the execu- tive excluded) will indicate the varied activities of the Deparlment. (1) The Division of Communicable Diseases; (2) The Division of Tuberculosis; (3) The Division of Sanitation; (4) The Division of Vital Statistics; (5) The Division of Child Hygiene and Public Health Nursing; (6) The Division of Sarvqiys and Bjural Hygiene; (7) The Division of Diagnostic Laboratories (with a central labora- tory at Springfield and six branch laboratories in different parts of the State) ; ■ 1 ' ^ -^| g^ (8) The Division of Hotel and Lodging House Inspection; (9) The Division of Public Health Instruction; (10) The Division of Social Hygiene (for the control of venereal disease). The work of these several divisions has recently been set forth in the report of the Department to the Governor and does not require pre- sentation in detail here. Among the important accomplishments of the Department are these: (1) The issuing of rules for the reporting of open cases of tubercu- losis by attending physicians and of venereal disease by attending physicians and druggists ; the promulgation of rules for the control of the tuberculous and the inauguration of a system of treatment of women of ill-repute afflicted by venereal disease at the expense of the counties in which they are arrested; (2) The reorganization of the system for the recording of deaths so that the State has been added to the (census) registration area for deaths ; ' Data for other states have been taken from A Report on State Public Health Work — Based on a Survey of State Boards of Health, by Charles V. Chapin, M. D. This survey was made under the direction of the Council on Health and Public Instruction of the American Medical Association, 1916. 4^ (3) The securing of fuller reports of communicable disease. In this connection it must be noted that many practitioners fail to report all cases of communicable disease attended by them. The complete reporting of deaths and of communicable diseases is as important in public health work as good accounting is in the conduct of a business. Without it the necessary basis for a successful combating of disease cannot be obtained ; (4) The fuller reporting of births. Unfortunately the failure of many physicians, midwives, and other attendants to report births fully has prevented the State from being added to the registration area for births and has not given the best basis for infant welfare work and improved maternity care; (5) The provision without charge (through some 500 stations) of vaccine for typhoid fever and of antitoxin for diphtheria; (6) The establishment in eleven cities of clinics for the effective treatment of crippled children, chiefly as a result of "infantile paralysis," these clinics resulting in the rehabilitation of many children who other- wise would remain handicapped for life; (7) The making of a number of sanitary surveys (in Freeport, Kockford, Waukegan, and elsewhere), of great importance in the de- velopment of good standards in the public health service; (8) A very effective educational campaign against disease and for good public health service through the Illinois Health News (monthly publication of the Department), leaflets, the press, by exhibits, etc.; (9) The establishment of a course for the training of public health nurses; (10) And the coordination of the public health and medical forces of the State in the control of contagious diseases, well illustrated in the recent epidemic of influenza which revealed the weakness and inadequacy of the local forces in combating disease in most parts of the State. Modern conditions call for a strong and liberally supported state department of public health if disease is to be efficiently combated and health conserved. They call also for much more as a summary discussion of local health administration will show. (3) Local Health Admmistration. Most of the work involved in combating disease and safe-guarding health is left, officially, to the local authorities. Of these there are about 1,100 in the State. In other words the 102 counties contain no fewer than 1,100 independent health districts. Some of these are townships, some are counties, some are incorporated villages with small populations, and a comparatively few are cities large enough to support an efficient health administration. Under the Cities and Villages Act, the city council in cities and the board of trustees in villages have power to appoint a board of health and prescribe its duties and powers. In cities under the commission form of government the statute provides for a department of public health and 43 safety, administered b}^ a commissioner, whose duties are prescribed by ordinance in the same manner as in other cases.^ The county commissioners in counties without township organization and the supervisor, assessor and town clerk of every town in counties under township organization, are constituted boards of health with powers and duties extending over the territory not included within the corporate limits of any city or village. If there is an outbreak of any dangerously communicable disease, it becomes the duty of any such board of health to make and enforce such rules and regulations as may be necessary to check the spread of the disease. It has power to make and enforce quarantine rules and to require disinfection in case of contagious disease. It has powers and duties, generally, "to do all acts, make all regulations which may be necessary or expedient for the promotion of health or the suppression of disease," "to appoint physicians as health officers and prescribe their duties,^' "to incur the expenses necessary for the performance of the duties and powers enjoined upon the board," "to provide gratuitous vaccination and disinfection," and "to require reports of dangerously communicable diseases." For each day spent in the performance of their duties in this connection each member of the board is allowed $1.50 together with all bills contracted and all sums of money expended.^ This basic legislation has not operated efficiently in the villages and smaller cities, and in the territory outside of incorporated places. Feel- ing the need for a better organization the last General Assembly, upon the recommendation of the Department of Public Health, enacted a laAV relating to the "organization of public health districts and for the estab- lishment and maintenance of a health department for the same."^ Under this Public Health District law "any town, or two or more adjacent towns in counties under township organization, or any road district, or two or more road districts in counties not under township organization, or any town or towns in a county under township organ- ization and an adjacent road district or road districts in a county not under township organization" may after petition signed by not less than five per cent of the voters voting at any election and upon the affirmative vote by a majority of those voting upon the question (in each minor political division involved), be organized into a public health district. If such a district is organized it has certain powers conferred upon it and is under the necessity of following certain standards set up in the law. In counties not under township organization the county com- missioners serve as the board of health for each public health district in the county. Where a public health district, in counties under township organization, consists of a single town, the supervisor, assessor and town clerk of such town serve as the board of health. Where the district con- sists of two or more adjacent towns, the supervisors and the chairman of the county board serve in that capacity. Finally, where a public health district consists of a town or towns in a county under township organ- * Illinois Department of Public Health, General Information and Laws. Effec- tive July 1, 1917, Section 40. 'Reference cited above, sections 34-38. 8 Law filed June 26, in force July 1, 1917. Laws of 1917, p. 763. Found in reference above cited, sections 41-60. 44 ization united with a road district or road districts in a county not under township organization, the supervisor or supervisors of the town or towns, together with the road district clerk or road district clerks, shall be the board of health for such public health district. When organized such a public health district has power to levy a "public health tax'' of not to exceed 4 mills on each dollar of taxable property within the district, over and above all other taxes, now or which may be authorized, the taxes, when collected, to constitute a "public health fund." The board is empowered, also, to appoint a public health officer, and with his advice and approval such nurses, chemists, experts, clerks, and assistants as the public health officer may deem necessary. It is, moreover, empowered to equip and maintain suitable offices, facil- ities and appliances and to establish, equip and maintain an analytical, biological and research laboratory. The health officer, be it noted, must be appointed from a list of eligibles supplied by the State Department of Public Health, shall devote all of his time to his official duties, and shall be paid an annual salary of not less than $1,500. He is the execu- tive officer of the district and shall make all necessary inspections and enforce all health and sanitary regulations in force in it. This act has made an improved local health administration possible. The act is, however, permissive, not mandatory, and no health districts have as yet been formed under it.'^ Interest in the War, lack of interest in public health, the necessity of holding an election, an interpretation of the law requiring the signing of the necessary petition to be by five per cent of the number voting at the election at which the largest vote was cast, and the addition of a special tax if a health district is created have stood in the way. It is unlikely that the permissive legislation will be effective. This is the description of local health administration from a legal point of view. From a practical point of view it can be said to be largely an incidental matter in local government, for most of those assuming responsibility under the law assume it because they have been selected for and serve in some other office. It has been said that "public health is purchasable and (in so far as it depends upon public health administration and sanitation) the community may have as much health or as little health as the people are willing to pay for." In Chicago and a small minority of other health districts a good deal has been spent on health administration and with good result. For many years the Chicago Health Department has com- pared favorably with the health departments of other large cities. In most parts of the State, with fully half of the population, little has been spent and inefficient health administration has been the result. . The one point on which there was general agreement among those who testified at the Commission's public hearings was that as a general rule local health administration is lamentably weak and ineffective. All agreed that something should be done to improve it and to place it upon an efficient basis. ^ LaSalle and two neighboring towns have a joint arrangement in health matters. This was entered into before the Public Health District Law was enacted and is independent of it. Steps are now being taken, in at least three localities, to hold elections to determine whether health districts shall be organized. 45 The two important reasons why local public health administration in Illinois is generally weak are: (1) most of the health districts are too small and have too little taxable property to support an efficient service; (2) other matters have made a stronger appeal to the citizens and to those who have directed local affairs. In other words, a bad organic law and a lack of appreciation of public health matters — not men in health offices — must bear the greater share of the responsibility for the situation that exists. But wherever the responsibility may rest, in Illinois as in most other states, little has been paid out of the public funds for health and sani- tation. Data are now being collected by the State Department of Public Health relating to this and to other matters, but, unfortunately, they have thus far been obtained from too few districts to show just what is being spent in the State as a whole. In the absence of better data those contained in the following table are presented. The sums entered are for the conservation of health and sanitation and include not only the amounts spent for local health administration but also the amounts spent for care of sewers, street cleaning, etc.^ The data are taken from the Census report on Wealth, Debt, and Taxation, and are for the year 1913.'' EXPENDITURES OF URBAN COMMUNITIES IN ILLINOIS FOR HEALTH AND SANITATION, 1913. Groups of cities and towns. Total Average Expendi- Popula- govern- fper tures on tion mental capita health of cost pay- of cost and group. ments of pay- sanita- group. ments. tion. Average Percent per capita of total expended expended for health on health and and sanitation. sanitation. Minimum and maximum main sums per capita spent for health and sanitation. Chicago Nine cities, popula tions of 30,000 and over Twenty-eight cities, populations of 8,000 to 30,000 Ninety-seven towns populations 2,500 to 8,000 , 2,344,018 $62,031,418 $26.46 $4,258,053 $1.82 6.9 415, 757 8,639,435 20.78 353, 336 .85 4.1 525,826 9,059,859 17.23 294,598 .56 3.2 413,534 6,895,350 16.67 90,582 .22 1.3 $.38 and 1.77 and .84 In 1913, according to the Census, the urban communities of Illi- nois with populations of 2,500 and over spent $87,363,536, of which $4,984,097 or 5.7 per cent was for health and sanitation. They spent on police, fire and related departments (for "protection of person and * The items included are shown by the Census definition of two groups of outlays reported separately for only such cities as have a population of 30,000 or over: (a) '^Expenses for conservation of health. — Under this title are included the ex- penses connected with the general conduct of the health department, the prevention and treatment of communicable diseases, the conservation of child life, including medical work for school children, and food regulation and inspection." (b) '^ Expenses for sanitation. — Expenses for sanitation, or promotion of clean- liness, include those for the care and maintenance of sewers and for the disposal of sewage, the collection and disposal of refuse, including the cleaning of streets, the operation of public laundries, washhouses, and convenience stations, the prevention of smoke, and other measures such as are employed by cities in securing sanitary conditions. ^ Table compiled from U. S. Census, Wealth, Debt and Taxation, Vol. II, pp. 582-586. 46 property") $13,375,024, or almost 2.7 times as much as for health and sanitation. The more recent data available in census publications indi- cate that while the outlavs have increased, there has been no substantial change in the relative figures here presented. In presenting these figures it should be clearly stated that Illinois is not exceptional in respect to the small outlays for health and sanitation. As against the $1.34 spent for health and sanitation by incorporated places here, New York in 1910 spent $2.11; Massachusetts, $1.78; Cali- fornia, $1.36; Wisconsin, $1.30; Ohio and Colorado, $1.17; Michigan, $1.11; Pennsylvania, $1.00; Minnesota, $.93; Indiana, $.74; Iowa, $.57; Kansas, $.48. These comparisons are not unfair for the figures in all cases are the average outlay for the populations of incorporated places of 2,500 and over. Some students of public health administration have maintained that . in a city of 20,000 the outlays required for the proper conservation of health will be about $1.00 per capita per year. Larger cities require more than $1 per capita; smaller places can give equivalent service for somewhat less. It will be noted in the above table that while Chicago spent $1.82 per capita, the nine cities other than Chicago with popu- lations of 30,000 or over, spent 85 cents, the smaller cities with 8,000 to 30,000, 56 cents, the smallest cities and towns, 22 cents. This was for both the conservation of health and sanitation. Were data available for the health districts outside of incorporated places the showing would be worse still. The table gives the minimum and the maximum figures for each group of incorporated places. Of course great differences between places are found. The details presented by the Census show that one city with a population of more than 35,000, 14 cities with populations of 8,000 to 30,000, and 78 smaller incorporated places, spent less than 40 cents per capita. Indeed one city with a population of more than 17,000 spent just 10 cents per capita, while 41 of the smallest towns and cities spent less than that sum. The census report on Financial Statistics of Cities for 1917 contains the following figures for Illinois cities with populations of 30,000 or over. Unfortunately corresponding data are not available for smaller places. EXPENDITURES OF ILLINOIS CITIES, 1917. City. Expenditures for conservation of health. Amount. Per capita. Expenditures for sanitation. Amount. Per capita. Chicago East St. Louis Peoria Springfield.... Rockford Decatur Joliet Quincy Aurora Danville $1,487,874 $0.60 $4,913,491 7,325 .10 69,203 24,106 .34 72,745 8,025 .13 51,682 19,109 .35 45,982 6,121 .15 19,906 3,120 .08 36,716 1,081 .03 18,339 4,569 .13 34,507 2,428 .07 17,184 $1.97 .93 1.02 .84 .83 .50 .97 .50 1.01 .53 47 The average per capita outlays for all cities of the United States in the group with East St. Louis, Peoria, Springfield, and Eockford were $.29 and $1.15 for health and sanitation respectively. The corres- ponding averages for cities of the next lower group containing Decatur, Joliet, Quincy, Aurora and Danville, were $.31 and $1.00. What these sums, especially when combined with the small health districts which so widely obtain, mean in terms of service those versed in health administration and sanitation will know. The following tabular statement of the answers from 343 health departments which had recently reported to the State Department of Public Health shows clearly the short-comings in local health legislation and administration.^*^ Item number. Population of places reporting. 20,000 and over.* 5,000 to 20,000. 1,000 to 5,000. 1,000 and less. Number of cities reporting Having annual appropriations for health work Having health officers Having full time health officers Having medical health officers Health officers receiving salary Cities having nursing service Doing public child hygiene work Having welfare stations In which health officer is registrar Campaigns made for complete reports Public sewerage system Public garbage collection Special tax levied for garbage Having manure ordinance Having public water supply Water regularly examined Water treated Water considered safe Having plumbing inspector Having full time plumbing inspector Having building code Having privy ordinance Venereal diseases reported Venereal diseases dispensary Regular food inspection Food conditions satisfactory Regular dairy inspection Dairy conditions satisfactory Communicable disease ordinances Communicable disease reports complete Having laboratory Epidemiological investigations made Cards used Instructions given Practicing fumigation Expense of fumigation defrayed by city. . . 12 38 122 11 25 34 12 38 93 6 2 9 29 56 12 4 5 1 4 4 7 3 7 7 11 10 30 61 12 36 53 8 17 12 4 11 9 12 29 65 12 38 75 10 20 5 8 15 7 12 32 72 11 20 26 9 7 8 10 10 25 10 34 72 4 15 26 3 5 10 3 6 24 74 10 17 4 6 27 75 12 34 88 9 31 58 6 2 10 14 24 8 8 14 12 36 101 12 38 121 12 34 92 171 22 104 74 21 81 17 7 1 71 24 27 1 i 74 52 121 106 92 78 33 19 136 165 125 • The city of Chiicago is not included. Health problems will not take care of themselves. Not only must there be a health officer, but it is agreed that he must he a full-time, well- trained, properly remunerated officer with tenure in harmony with the spirit of civil service rules. A considerable number of the smaller places reporting have no regular health officers; only half of the larger cities, only 2 of the 38 cities in the 5,000 to 20,000 group, and none of the smaller cities have a full-time officer. The fact is that most of the smaller " The Health Insurance Commission is indebted to the Department of Public Health for these and much other data. 48 places could not afford to hire a full-time officer worth hiring. It can be taken for granted that seldom do the officers not medically trained, have any special training for the work they are presumed to do. Only 9 of 12 health officers in the largest cities, only 29 of 38 in the next largest cities, only 58 of 93 in the towns and cities with populations of from 1,000 to 5,000, and only 74 of 104 in the smallest places, reported themselves as medically, trained. Put in other words, only in two cases in three is the health officer medically trained, and in only one case in thirty does he, whether trained or untrained, devote his full time to his office. Or, put in still other words, in the smaller health districts there is no health officer at all, or a policeman or some one else who serves incidentally, or a doctor whose service is incidental to his private practice. In the larger places the health officer is most frequently a doctor engaged for the greater part of his time in taking care of his private practice. Seldom are appointments and tenure in harmony with the spirit of our civil service laws. Comment on most of the things shown by this tabular statement is unnecessary — the limited public health nursing service; the limited amount of public child hygiene work; the limited number of child wel- fare stations; the large number of places in which no campaign has been made to secure complete reporting of births and deaths ; the number of cities without a public sewerage system ; the exceptional cases in which public provision is made for the disposal of garbage; the limited extent to which the right has been exercised to levy a special, tax for garbage collection and disposal; the many places with no ordinance relating to the disposal of manure; the neglect of water, which frequently cannot be reported safe; the infrequent building codes; the frequent absence of regulations relative to privies; the fairly general failure to inspect dairies with the result that conditions in dairies are frequently un- satisfactory or bad; the frequent failure to report communicable dis- eases fully; the general absence of laboratories for health work; and the shortcomings in placarding contagious diseases and the occasional failure reported to make sanitary the places in which these contagious diseases have occurred. In view of what has been said the following summary of a survey of a large number of mining towns will occasion no surprise: "Many mining towns are unincorporated. Often there is no health officer. The board of health consists of the mayor and two or more members of the council in the larger (incorporated) towns. In many cases only the township supervisor's arrangement prevails. Very often the health officer is not a physician and is entirely unskilled in matters of hygiene and sanitation. Very often he belongs to the old type of health officer, who lays stress on rubbage, ash-dumps, foul smells, and fumigation, but pays little attention to wells, privies, screening, milk supply, or the prompt isolation and concurrent disinfection of a case of communicable disease. "The public health protection as afforded in 98 per cent of the towns visited was found to be very unsatisfactory. The methods of handling communicable diseases are old and not in accord with modern methods. 49 In some communities persons quarantined were required to pay for fumigation * * * "A large per cent of the towns visited were without sewers and con- sequently privies were the common method of excreta disposal. Shallow wells were also in use."^^ The sanitary surveys thus far made show that this situation is by no means limited to mining towns. Sanitary surveys show extensive problems in rural communities; they show also extensive problems in some of the cities of second rank in population. (4) The Campaign Against Tuberculosis. No campaign for the prevention of disease can be complete that does not include a well developed plan for locating, controlling and pre- venting the spread of tuberculosis. Tuberculosis in 1917-18 ranked first among diseases of major sani- tary importance, as a cause of death in Illinois.^^ In the United States as a whole the Census Mortality Statistics show that in 1916 tuberculosis was the cause of death in 1 case in 10 (10.1 per cent). Pulmonary tuberculosis has its greatest incidence among adults between the ages of 21 and 45. In view of this fact it is not surprising that 5.37 per cent of the young men rejected in the first draft were re- jected because tuberculous. This was about 1.56 per cent of all who were examined. In the Framingham Community Health and Tuberculosis Survey a special effort has been made to ascertain how many are afflicted with tuberculosis in its different forms. Of 4,473 carefully examined in Framingham, 96 or 2.14 per cent were found to be tuberculous. It was found, moreover, that there were 9 active cases and 12 other cases for each death — ratios much larger than those which have been used in calculating the number of "living cases" from the number of reported deaths. If the ratios found to obtain in Framingham may be applied in this State, last year there were more than 175,000 cases of tuberculosis in Illinois, and of these more than 75,000 were active. If they are applied to Chicago, the Health Commissioner's estimate of 60,482 cases for 1916 appears to be conservative.^^ Again, if applied to the State outside of Chicago, the estimate of 50,000 active cases recently made by the President of the Illinois Tuberculosis Association and based upon considerable investigation, finds a degree of support.^* The truth is that tuberculosis is a very prevalent disease and when looked for can be found in much larger degree than is commonly realized. " See Part II of this report, Special Report V. "The number of deaths from pulmonary tuberculosis was 7,481 ; from all forms of tuberculosis, 8,402 ; from pneumonia, which ranked second, 8,277. The total number of deaths reported was 89,428 ; hence tuberculosis was the cause of death in more than 1 case in 11. " Estimate made in connection with the findings of the tuberculosis survey con- ducted by the Chicago Health Department. For the report of th^e results of this survey, see City of Chicago, Municipal Tuberculosis Sanitarium, Annual Report, 1917, pp. 96-119. " -See Division of Tuberculosis, the Department of Public Health, in Reports to the Governor, 1917-1918, p. 471. — 4 H I 50 Not only is tuberculosis a very prevalent disease ; it is also a disease appearing in active form most frequently among those of working years in wage-earning families, is of relatively long duration, and with un- usual frequency reduces families to poverty and dependency. The records of a large number of plants and of the offices and selling forces connected with them, show that in the three years 1915 to 1917, 89 of 146 ■emplo3^ees afflicted with tuberculosis were disabled for more than 180 days per year. Many of these were never able to return to work at all. The Commission's investigations of families in receipt of charity show as the outstanding fact that cases of chronic illness are a very im- portant cause of dependency and that tuberculosis is as important among these chronic diseases as all others combined. ^^ The "white plague" presents for solution in Illinois a larger problem than that presented by any other disease^ and though its ravages have been fatal in relatively fewer cases as the years have gone by,^^ the return of soldiers from the front and the increased cost of living will tend to increase the dimensions of the problem for a time. Already more than 1,500 soldiers have been returned to Illinois afflicted with tuberculosis and the experience of the civil populations of the European countries has shown that increasing difficulties connected with the food supply have been accompanied by an increased death rate from tuberculosis.^" It is generally accepted that most tuberculosis infections occur in early childhood. Dr. Armstrong states that "A recent Von Pirquet tuberculin studv of children between the ages of one and seven vears in Framingham indicated that 33 per cent of them had already been infected, though up to that time the cases of actual disease were few."^^ More than fifty per cent of the cases found in the Chicago Tuberculosis Survey were of children under fourteen years of age. In view of this fact infant welfare work and thorough medical supervision of school children find an important place in the prevention and cure of tubercu- losis. So does the sanitation of milk, for, to quote Dr. Armstrong again, "It has been recently pointed out by Cobbett that the percentage of cervical adenitis among children which is definitely of bovine origin is 75 per cent of the cases." And so do better housing, better living conditions generally, and opportunities for recreation under suitable conditions. The more direct campaign against tuberculosis, it is agreed by those with most experience in this field of work, calls for community surveys and careful physical examination of people at work so as to locate cases while in the incipient stage and for the fullest reporting of cases by attending physicians; for sanatoria in which the worst of the open cases can be isolated and treated indefinitely and in which a larger number can be treated temporarily and more carefully instructed in proper living and exercise of care when returned to their homes; dispensaries for diagnosing, medicating and advising those who do not have sani- " See discussions in Chapter I above and Special Report I. "The Census (Mortality Statistics, 1916, p. 42) reports the annual average of death rates from tuberculosis as 168.7 per 100,000 population for the years 1906 to 1910, as 192.5 for the years 1901 to 1905. ^' See paper by B. A. Armstrong, M. D., on "Civilian Tuberculosis Control Fol- lowing War Conditions," in Aiinerican Journal of Public Health, December, 1918. " Reference cited above. 51 tarium treatment or who have been discharged after treatment; and a visiting nurse service. The city of Chicago stands out prominently among American com- munities combating tuberculosis. It provides a Municipal Tuberculosis Sanitarium with 750 beds; 8 dispensaries scientifically located, in charge of physicians and open every day and part of the evenings ; a large corps of nurses; and thirteen fresh-air schools in which 743 children were en- rolled, .taught and cared for in 1916-17.^^ In this connection it should be said that the Chicago Tuberculosis Institute organized seven dis- pensaries in 1907 and 1908. These were taken over by the city in 1910; more recently they have been reorganized and the number added to. The dispensary cases are effectively followed up and in accordance with the customary routine, the several members of the family find place on the dispensary list when the name of one member is registered there. -° In Illinois outside of Chicago only an effective beginning has been made in dealing with the tuberculosis problem. As already stated,^^ the Department of Public Health has issued rules requiring the reporting of cases of tuberculosis by attending physicians and for the control of the tuberculous. It has also organized a Division of Tuberculosis. This is effective in securing the adoption of sanatoria in the several counties or cities, in the proper organization of these, in the training of the needed public health nurses, in holding conferences, etc. A number of the states have made state-wide provision for the care of the tuberculous.^^ Pennsylvania, where a few years ago there were three large hospitals and 114 dispensaries supported by the state, is the most conspicuous example of this. Some other states, e. g. Wisconsin, combine a state institution wdth subsidies to and control over local insti- tutions, while a few other states have a system of subsidies to local in- stitutions accompanied by more or less control over them. In Illinois, however, there is neither a system of state institutions nor a S3'stem of subsidies, and there is only a limited official control of the local insti- tutions established. Here an effort is being made to solve the problem by county and city sanatoria, dispensaries, and public health nurses. This has the advantage of bringing the institutions into closer touch with the community, but how effective the plan will be remains to be seen. Whether the institutions will be properly organized and administered according to the best standards and properly supported and whether they will be made available in those parts of the State where the burden of taxation is most keenly felt and the appreciation of the problem is least, is a question to be answered only by experience. IJnder the "Glackin Law," enacted in 1915,^^ "the county board of each county in this State shall have the power in the manner herein- after provided, to establish and maintain a county tuberculosis sani- " For a fuU account of the" activities of these several institutions, see City of Chicago Municipal Tuberculosis Sanitarium, Annual Report, 1917, especially pp. 1-125. ^^ In 1918 the dispensaries registered 17,953 new cases; the number of patients treated was 56,394 ; the number of visits to the dispensaries was 77,978. " See discussion earlier in this chapter " See A Report on State Public Health Work, Based on a Survey of State Boards of Health, by Charles V. Chapin, M. D., 1916. 23 Approved June 28, and in effect July 1, 1915 (Laws, 1915, p 346). 52 tarium, and branches, dispensaries, and other auxiliary institutions con- nected with the same, within the limits of each county, for the use and benefit of the inhabitants thereof, for the treatment and care of persons afflicted with tuberculosis, and shall have power to levy a tax of not to exceed three mills on the dollar annually" to constitute a "Tuberculosis Sanitarium Fund." When established, the location and building plans for the sanitarium are to be approved by the Department of Public Health; the location and management are to be entirely divorced from the poor farm or infirmary; it is to be under the control of a board of three directors; this board may extend the use and treatment of the sanitarium to residents of other counties of the State upon such terms as they may establish. The decision as to whether a sanitarium shall be established and the levy of the necessary tax for its support authorized is determined by referendum vote. The enactment of the Glackin Law had been preceded by the enact- ment of a similar law conferring like powers but with a maximum tax levy of one mill, upon cities and villages.^^ Under the municipal sani- tarium act, Danville, Elgin, Springfield, Rock Island, Rockford, and Peoria, have established sanatoria. Under the Glackin Law, seven counties in 1916 voted to establish sanatoria; thirty-three others voted affirmatively on referenda submitted at the last general election.^^ As yet, however, few of these have been built. At the present time the number of sanitarium beds outside of Chicago, it has been recently stated, does not exceed 250 and most of these are in private sanatoria operated at relatively high rates. ^^ In some instances the provision of dispensary and nursing service has preceded the building and opening of sanatoria, and in a year or so the number of free beds available for patients, and without regard to pecuniary conditions will be very materially increased. In addition to this public provision, there is the provision made by employers and others which supplements that made by the cities and counties. The educational activity of the Illinois Tuberculosis Asso- ciation, the Chicago Tuberculosis Institute and other organizations is an important factor in the advance being made. One problem which has not been arid is not being solved to any extent except by charity is the financial one of supporting the depen- dents of the tuberculous wage-earner whose recovery requires that he should stop work while under treatment in the sanitarium or at home. It would appear that many of the tuberculous cannot be successfully treated if they continue in their regular employment. Again, the tuberculous are having increasing difficulty in keeping their employment because of medical examinations and rejections for fear of danger to others. Further, successful treatment when it requires rest, is a rela- 2* Act approved March 7, in force July 1, 1908. Amended by act approved June 27, in force July 1, 1913. 28 The seven counties voting- in 1916 to establish sanatoria were : Adams, Cham- paign, Morgan, McLean, Ogle, Livingston, and LaSalle. The 33 voting favorably (all in which a referendum was submitted were: Bone, Bureau, Ch>ristian. Clark, Clay, DeWitt, Coles, Crawford, DeKalb, Douglas, Fulton, Grundy, Henry, Jackson, Jefferson, Kane, Lee, Logan, McDonough, Macon, Madison, Marion, Piatt, Pike, Randolph, Scott, Stephenson, Tazewell, Vermillion, Whitesides, Will, Winnebago, and Woodford. "See report, Division of Tuberculosis, cited above, p. 471. 53 tively long process. Finally, in many benefit funds no benefits are allowed in case of tuberculosis or other chronic diseases or those allowed are for a relatively short time. The insurance companies, as a rule, limit benefits in the case of tuberculosis to a much shorter period than for most diseases covered by health policies. The result generally is that men keep their jobs as long as they can in order to support their families. Inevitably the time comes when they can no longer work and there is little chance of successful treatment. Two tuberculosis specialists with wide experience have testified before the Commission that in not more than two or three per cent of the dispensary cases where they have advised rest or work for a limited number of hours, has the advice been followed. The reason for this, it was stated, is not found in any false hope of an early recovery while at work, but in the economic necessity of supporting dependents. Much other testimony to the same effect was presented to the Commission at its public hearings and con- ferences. Obviously one gap in the provision for the tuberculous will not be closed under the plans being developed. Those who have given the Commission the benefit of their thought and experience have agreed that a financial benefit to cover the actual needs of dependents is necessary if many wage-earners with dependents are to have successful treatment in the institutions being provided at public expense and open to all residents as a matter of right. Some have suggested that pro- vision should be made for a cash benefit not unlike that granted (under the "funds to parents act") to mothers with permanently disabled husbands. Others have suggested that in so far as wage-earners are concerned, the situation might be met by insurance with benefits not limited to a certain number of weeks or months in the year. Of course the majority of the tuberculous can do a certain amount of work while being properly treated, and in this way earn at least a part of the cost of supporting themselves and their families — provided the work is of a suitable kind. Unfortunately suitable employment is frequently hard to find, and experience shows that a very large per- centage of those discharged from the sanatoria soon break down in spite of the knowledge they have gained with reference to diet and care, when they must fit into industrial life in the usual way. The experience of the Committee for the care of the Jewish Tuberculous, New York City, is of importance in connection with this and other phases of the problem.^^ The Committee referred to found after two years of experience "that of the patients discharged from one sanitarium, the cases being classed as improved, quiescent, or arrested, about 45 per cent were worse or dead within six months to two years after discharge." In order to meet this situation a well-worked out system of family care and a factory to give employment to patients with negative sputum have been established. To quote from the Executive Secretary: "Our method of treatment includes a physical examination, and periodic reexaminations " of all members of the family, with particular " See published annual reports, and article by the Executive Secretary, Edward Hochhauser on "Home Treatment for the Tuberculous," in Modern Hospital, March, 1917. 54 emphasis on the patient. Medical aid is given in the form of extra diet, medicines, or if the mother is the patient, relief from heavy house- work. When financial assistance is necessary for rent, food, or cloth- ing, it is granted through the committee, the United Hebrew Charities, a part of our committee, cooperating in each case. The care given ranges from medical care, home visitation by our nurses, dental treat- ment, to an annual allowance of $600 for food, rent, and clothing, for one family with seven children under 15 years of age. "Our purpose is not only to arrest the disease, but also to return the patient to economic usefulness and independence. The patient on his discharge is often able to work but part time. He needs to be carried through a period of industrial convalescence, and gradually returned to old-time working capacity. "Eeturning a patient to industrial life is distinctly a part of his treatment. At least a contributing cause in the relapses that occur is the fact that the transition from no activity, or a few hours of institu- tional work to the demands of industry; a full day's work at full speed is too great. We found, however, that employers were not disposed to allow part-time work — they could not afford to keep part-time workers. To safeguard the health of the workers, control the hours and amount of work, and the working conditions, we found it necessary to start a factory of our own." The work provided by the Committee is in the needle trades, in which some sixty per cent of the patients had experience. Those who can be suitably provided for otherwise, go into other employments; those who cannot be and are able to work without danger to them- selves and risk to others are given employment here under suitable con- ditions and careful supervision. The experiment combining home care and industrial employment of those able to work part or full time, has been successful in reducing the relapses among those discharged from sanitarium treatment from 45 to less than 15 per cent. By the experi- ment, "we have demonstrated," says the Executive Secretary, "that by after-care or home care we can save many patients ' from relapses and premature death. This treatment, however^ must be intensive, and where relief is necessary it must be generous. This form of medical social treatment, by treating patients and their families in their own homes, can be readily extended, as the cost is not prohibitive, and can be main- tained by the patients when they are restored to industrial usefulness." Thus, this experience in New York confirms the opinions of those who testified before the Commission that there is need for financial support and suitable employment as well as for sanatoria, dispensaries and nursing service. (5) The Campaign Against Venereal Disease. Society is coming more and more to recognize the significance of the menace of the venereal diseases. Somewhat more slowly is coming a community sense of responsibility for their control through education, prevention and treatment. The War which revealed how venereal disease rendered many of our young men unfit for military service and showed that military leaders recognize in it a greater danger than in the 55 bullets of the enemy, has had much to do with the arousing of public interest in the problem. Patients suffering from venereal diseases seek treatment from several different sources. Many become private patients of practicing physicians. Many others, especially in cities, seek treatment in dis- pensaries and clinics. Ingenious advertising and a desire for secrecy lead many others to resort to quacks who thrive on their patients' ignorance and fears. Many others do not consult doctors at all but purchase remedies from drug stores and administer their own treatment. There are no adequate statistics^^ available concerning the number of venereal disease patients under treatment by private physicians in Illinois nor concerning the efficacy of the treatment they receive. There is frequent testimony from physicians to the effect that many such patients discontinue treatment as soon as the distressing symptoms disappear but long before cure has been effected. The Eed League, a Chicago organization, "devoted to the study, prevention and treatment of venereal diseases,'' made a survey in 1917 of the hospitals and dispensaries in Chicago, with reference to their facilities for the diagnosis and treatment of venereal diseases. It found that eleven out of forty-one hospitals visited admit patients suffering from these in their active infectious stages, but that only one hospital admitted such patients who were unable to pay for their care. A larger number admit patients who have these diseases in non-infectious forms. Of nineteen dispensaries visited, it found but three adequately equipped to treat such patients. The general conclusions of its survey are here given : "1. At many of the dispensaries individual care and treatment of the highest order was given the patients. Of the total number of dispensaries visited there were three only whose records demonstrated their efficiency according to the standards indicated by our questionnaire. Two of these treat large numbers of patients and one a very small number. "2. With these exceptions the dispensaries showed their inefficiency either in lack of adequate equipment, or incomplete history cards which failed to record a proper history, the date of visits, the treatment given and results of treatment, or in failure to have any follow-up system such as date cards and social service worker. "3. The explanation of this inefficiency was given as insufficient funds to furnish clerical force, lack of interest on the part of the attend- ing physicians and no regulation on the part of law or health department to enforce the proper recognition and treatment of venereal disease." It must be borne in mind that this survey was made prior to the time when venereal diseases were made reportable throughout the State and before the War had brought to the attention of the public, as it since has done so forcibly, the significance of the venereal disease peril. Though the Red League found most of the dispensaries giving inadequate service to this group of patients, that organization recognized the dispensary as an effective and economical means of providing adequate treatment for " Venereal diseases are to be reported by doctors and druggists but this order became effective only recently. The reporting has as yet been only partial. Th(e truth is that only a small part of the cases have been reported. 56 venereal disease and on the basis of this conclusion, opened a special venereal disease dispensary under its own management. There is no way of measuring the patronage of the quack venereal disease specialists. It is large, beyond doubt. Publicity, the establish- ment of better and more widely known dispensary facilities and a more rigid enforcement of medical practice laws, are unquestionably tending to divert some of the patients who would otherwise become the victims of these charlatans. Some of the better newspapers no longer accept their advertisements but they are still able to reach a large number of readers, especially through the foreign language press and through papers having wide circulation in the smaller cities and towns. Their booklets of lies and distorted truths still find thousands of readers and their advertisements of fake cures are displayed in public toilet rooms almost universally. While most patients suffering from venereal diseases are not con- fined to their beds and can be effectively treated as ambulatory patients, there is a small percentage who need hospital care. For these, facilities are very inadequate. Many hospitals will admit no patients of this class, either l3ecause they have no facilities for their segregation or because the management of the hospital feels that syphilitics and gonorrhoeics do not deserve the consideration and care readily granted to patients suffering from other less odious ailments. Eecently the Department of Health of Chicago has established a hospital for the treatment of women offenders suffering from venereal disease. In June 1917, the City Council of Chicago passed an ordinance re- quiring the reporting of venereal diseases. More recently the State De- partment of Public Health has made mandatory the reporting of these diseases throughout the State. The provisions of these two regulations are very similiar. In general they provide that every physician, manager of a medical institution and every other person giving treatment for syphilis, gonorrhoea and chancroid shall report each such case to the designated health authorities within a fixed brief period after the case has been diagnosed. This report sHall contain the age, sex, color, marital condition, occupation (in State regulations the name of the employer), the nature and previous duration of the disease and its probable origin. Instead of the name and address of the patient, the physician or person reporting may use a key number by which he may if required at any time identify the patient. Should the patient dis- continue treatment before being discharged by the physician treating him and should that physician within a period of ten days not receive notification from some other physician that the patient in question is now under his treatment, it becomes the duty of the first physician to report to the proper health authorities the name and address of the patient, the name of the disease for which he has been under treatment and the fact that he has discontinued treatment. The health authorities may then proceed as in the case of any other contagious disease. Probably the greatest good to come from these regulations is that of keeping undeu treatment those pelrsons sufflering from venereal diseases who seek treatment from physicians, at least until their disease 57 is no longer infectious. Of course this is one of the most effective means of preventing the spread of these diseases. The Congress of the United States has appropriated the sum of $2,000,000 to be used during the two year period, July 1918 to July 1920, in venereal disease control. The one million set apart to be used during the first year is divided among the several states on the basis of population. Illinois' portion for this first year is something over $60,000. This money is to be used for education in social hygiene and in the prevention and treatment of venereal diseases. This program is being carried out by the State Department of Public Health in co- operation with the United States Public Health Service. One half of the sum available is to be used for treatment. The State Department of Public Health has wisely decided to use this money for the purchase of Arsephenamine (Salvarsan) to be used in the treatment of persons suffering from syphilis in an infectious stage and who are unable to pay for such treatment. In Chicago much of this treatment will be given in dispensaries. The amount of money available for Illinois the second year under the Act of Congress will be dependent within limits upon an appropriation of a like sum by the State Legislature. In other words an appropriation of $60,000 or less by the present General Assembly for venereal disease control in Illinois in 1919-20 will be augmented by a like sum from the National Grovernment. What 'further action Congress will take in the matter will no doubt be dependent largely upon the success of this initial experiment. Making venereal diseases reportable and the appropriation of public money for their control and prevention are two steps of primary im- portance in thel camp^aign against these diseases. They mark the recognition of venereal disease as a community problem and the begin- ning of community action for their control and possibly eventual eradication. (6) Maternity Care. The child-bearing function brings a sickness problem both to the mother and to the offspring. It has been stated that childbirth causes more deaths among women between the ages of fifteen and forty-four than any disease except tuberculosis.^^ The total deaths from child- birth in Chicago during 1917 was 335, which was between 5 and 6 deaths per 1,000 births. ^^ The mortality rate for infants under 1 year of age is also very high. It is generally believed that both of these rates can be greatly reduced if adequate and proper care are furnished. In recent years considerable attention has been given in this anrf other countries to methods of reducing death incidental to bearing children and among infants. In the case of the mother two proposals have been made — namely, provision for maternity benefit, and the in- creased and improved facilities for advice and medical care during the 29 Julia Lathrop, Chief U. S. Children's Bureau, at Conference on Social Work, May 16, 1918, in paper on State Care for Mothers and Infants. *" In 1916, there were 47,769 births reported to the Health Department. The Department estimated this to be about 75 per cent of the total births, whichi would amount on this basis to 63,692. The 335 deaths of mothers in childbirth would then give a rate of between 5 and 6 per 1,000. 58 period of pregnancy and at the time of confinement. To relieve the economic pressure that is entailed by sickness and loss of employment, a cash maternity benefit has been proposed, a method employed by the states in Australia. From October 10, 1912, to June 30, 1916, the government in Australia granted £2,441,355 in maternity benefits to 488,271 cases. It is stated that claims were allowed in 93 per cent of the total number of confinements in the Commonwealth. The payment of cash benefits, however, does not seem to solve the problem in these countries. In August, 1917, a parliamentary committee on Maternal Mortality in Childbirth stated: "Your Committee is of the opinion that much greater benefit could be obtained from the large sum of money spent annually than is being obtained under the present system." "In the opinion of your Committee, however, there is imperative need for immediate extension of existing facilities for pregnant women to obtain skilled advice concerning their health before their confinement, and the Commonwealth Government might well provide financial assist- ance to enable women^s hospitals and similar institutions to inaugurate or extend such branches of their activity, and might even undertake the provision of facilities in places where they are as yet non-existent. The return to the community would almost certainly more than compen- sate for the expenditure involved."^^ A similar opinion was expressed by the Local Government Board of England and Wales in its report of 1917 in which the necessity for increasing the protection of mothers and babies was emphasized. They reported a program already in operation which included centers for hygienic and medical advice for mothers and babies, provision for care at childbirth, arrangements for hospital care where needed, and home visiting by health visitors.^^ It would seem, therefore, that in other countries there is a growing opinion in favor of increasing the facilities for medical care before and during confinement as a part of a state or national policy. The Commission is unable to find that maternity care has as yet received a large amount of organized or community attention in this State. In the "Block Studies" made in Chicago 695 maternity cases were found. Complete information was received concerning the costs in 680 of the cases. In 83, or 11.9 per cent of these, the entire medical and nursing service was free. In 129, or 18.6 per cent of the cases, a part of the service was free. In other words in 30.5 per cent of the cases all or part of the care was furnished to the patient without expense. An examination of the nature of this free service shows that in 44 cases out of 378 employing a physician, the doctors' services were unpaid; in 7 of the 277 mid-wife cases, and in 44 of the 95 hospital cases the service was furnished without charge to the patient. A similar situation is found in the nursing care, as this service was also furnished free in 79 out of the 217 cases in which special nursing service was received. Thus it is evident that in a considerable number of cases when the '1 Miss Lathrop, op. cit. «2 Ibid. 59 patient is unable to pay the necessary and frequently meager service is furnished free by attendants who are ordinarily paid for such care, and in other cases by social agencies that are so organized that they furnish the care free to those who are unable to get it in any other way. The percentage of those receiving free service varies widely among the different nationalities, as may be seen from the following table. REMUNERATED AND FREE SERVICE IN MATERNITY CASES BY NATIONALITY. Nationality. Total number cases. Number with paid service only. Number with free service. Number with both paid and free service. Number and per cent of those receiving some free service. Number. Per cent. Total 695 477 83 129 212 30.5 United States white 162 39 26 39 26 67 42 27 174 23 70 99 13 21 23 16 45 19 27 143 19 52 7 11 2 3 3 15 14 55 14 3 13 7 7 9 62 25 5 16 10 22 23 38.2 United States black 64.1 Bohemian 19.2 German 41.0 Irish 38.4 ItaUan 32.8 Jewish 54.7 Lithuanian Polish 21 7 4 8 28 4 16 16.0 Scand navian 17.4 Other 8 22.8 Over against the cases with free service may be set the pay cases. There were 597 of these concerning which the completed expenditures were obtained. The total costs in these 597 cases were $14,311, or an average of $24 per case. These costs included all bills for service whether of physicians, mid-wife, nurse or hospital. In the 328 pay cases employing a physician the average charge was $23.64.^^ However, in 56.4 per cent of these cases the charge amounted to $25 or more. In the 264 pay cases employing a mid-wife the average was $11.42, but in 21.6 per cent of these cases the charge was $15 or over.^* The cost in the 48 pay cases attended at the hospital was $2,093^ or an average charge of $43.60 per case.^^ The cost of the nursing care varied with the type of nursing. The average for the private nurse was $18.23 and for the visiting nurse $2.71,^^ which means that the bedside nursing averaged about a week. The kind of attendance at confinements is of interest. Information on this point was received in 691 of the 695 cases. In 2 of these births occurred without attendants, leaving 689 cases with attendants. Ninety- five of these confinements were in the hospital and 594 were at home. In ••There were 378 cases employing a physician; in 44 cases the services were free, in 328 the services were paid for; in 6 the information was incomplete. '* There were 277 mid- wife cases; 7 were free, 264 were pay cases. The infor- mation was incomplete in the remaining 6 cases. •'In 48 of the 95 hospital cases the services were paid for; in 44 the services were free and in 3 cases the information was incomplete. ■* The private nurse was employed in 70 cases and full returns of charges were received in 69 of these. A visiting nurse was employed in 130, and charges were made in 69 cases. The free cases included 1 private nurse, 60 visiting nurses and 17 cases with nursing of some other kind. 60 317, or 53.3 per cent, of the home cases a physician was in attendance. In 247 home cases, or 41.5 per cent, a mid-wife, and in 30, or 5.17 per cent, both a physician and mid-wife were in attendance. The mid-wife was more frequently employed by the Bohemians, Italians, Lithuanians and Poles than by the other nationalities. The relative number of cases employing a physician only, and those employing a mid-wife only may be seen in the following table : USE OF PHYSICIAN AND OF MID-WIFE IN HOME CONFINEMENT CASES. Nationality. Total number of cases. Physician only. Number. Per cent. Midwife only. Number. Per cent. Physician and midwife. Number. Per cent. Total United States white* United States black. Bohemian German Irish Italian Jewish Lithuanian Polish Scandinavian Other 594 317 53.3 247 41.5 30 140 27 24 31 22 64 22 27 159 16 62 117 19 6 26 22 26 21 6 37 12 25 83.5 70.3 25. 83.8 100. 40.6 95.4 22.2 23.2 75. 40.3 22 5 17 3 15.8 18.5 70.8 9.7 .0 56.2 4.5 59.2 69.1 25. 53.2 1 3 1 2 36 1 16 110 4 33 2 5 12 4 5.1 .8 11.1 4.1 6.4 .0 3 1 5 6 4 18. 7, * Includes families where the father was native born of foreign born parents. The niid-wife only was employed in 70.8 per cent of the Bohemian, 69.1 per cent of the Polish, 59.2 per cent of the Lithuanian, and 56.2 per cent of the Italian confinements. Public health officers and physicians generally agree that licensing and control over mid-wives is inadequate. The importance of such con- trol as a vital part of the public health administration may be seen from the following table which consists of a detailed statement of the edu- cation, special training, fees charged, visits per case, etc., of 50 practic- ing mid-wives selected at random from the Chicago Health Department records." 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'd ^3 'd 'O 'd X3 t3 'd X? 'O 'O 'O w 00 O _p 05 ^ O Jl (-4 O*- „ _ _ -„ o o a 2 O 03 05 0=2 <3 t' °5 a) O -d ,a g pj ; ^; rrt P IS (h « ri 03 C] a> (-1 g, O.S.Ih 03 :^'S OOOOOOOOO'dCO'OSOOOO ^;i :^;^ StOOTOT'OTMOTtOOTWOTraWCQMOJCOW 00)0300303030303030303030303030)03 ^XJrC 03 C8 fl fl fl A d o9 C3 O O Ii ;-> (i 03 03 03 .^.^ . .aaa ........ a c3 pt fl'^ 65 elation, and by the Central Free Dispensary and two or three similar organizations which maintain out-patient obstetrical departments. Less is being done in the State outside of Chicago for the visiting nursing, dispensary and infant welfare organizations are not so extensively developed. The experience of the Metropolitan Insurance Company in provid- ing nursing service in maternity cases is valuable. "During 1911, there were 70.1 deaths from causes associated with child-birth per 100,000 white female policyholders between the ages 15 and 44. In 1916 the death rate from these conditions was re- duced to 62.6 per 1000,000, a decrease in the rate of 10.7 per cent. Among colored female policyholders the. rate for mortality from causes connected with childbearing was 88.4 per 100,000 in 1911. This rate was reduced to a figure of 70.4 in 1916, a decline of 20.4 per cent. The consistent decline in mortality from puerperal conditions and diseases among both white and colored policyholders is in marked contrast to the mortality figures for the general population included in the Reg- istration Area for deaths in the United States. In the five years prior to 1916, the death rate from the diseases connected with childbearing had been practically stationary."*^ The importance of good maternity care is shown by the results obtained by some of the few institutions in Chicago that are giving attention to this subject. The Central Free Dispensary gives examinations and registers cases in early pregnancy. These cases are then followed-up and observed and advised by a visiting nurse. Eeexaminations are made by the physician as needed. Physician and nurse attend at confinement. After con- finement the case is referred to the Visiting Nurse Association for nursing care and later to the Infant Welfare Society. From April 1, 1908 to December 31, 1918 the Central Free Dispensary cared for 4,344 home confinements with only 4 deaths. Working along similar lines the Dispensary of the Chicago Lying- in Hospital during the first 19 years of its operation cared for 24,764 confinements, with only 8 deaths among the patients who came ex- clusively under its care. Eecords of this kind show the possibility of reducing deaths from childbirth and stand in contrast to the records for the City as a whole where deaths from childbirth amounted in 1917, as shown above, to between 5 and 6 per 1,000. These figures emphasize both the need for and the successful results of good maternity care. (7) Infant Welfare Worh. Consideration of the problein of the preservation of the life of the child follows naturally the consideration of the problem of conserving the life of the mother. One of the chief difficulties in studying the infant welfare problem is the deficiency in information concerning infant mortality rates. Illinois is not a "registration state^' for births. In " Quoted from "Visiting- Nursing and Life Insurance," by Lee K. Frankel and Louis I. Dublin, Quarte^'ly Publications of the American Statistical Association, June 1918, p. 38. — 5 H I 66 Chicago where a most active effort has been made to secure complete reports, the Health Department does not claim to get more than 75 per cent of the entire number. Under the circumstances no comparisons can be made of deaths of children under one year of age and the number of "live births" for any places in the State except Streator, Quincy, and Peoria where the Children's Bureau has recently completed investigations with results making such comparisons possible. The death rates per 1,000 live births were found to be 83.9, 82.8 and 101.6 in these three cities respectively.^^ Unfortunately, also, until 1918 Illinois was not a registration state for deaths. Until detailed mortality figures are available for the year 1917-1918 it will not be possible to compare the deaths of children under one 3'ear of age with the estimated total population. For some years, however, eight of the cities have had sufficiently complete reports of deaths to be included in the registration area. Though they are of limited value because of the margin of error in the estimates of population and the varying percentage of those under one year of age in the total population, comparisons of deaths of infants and total popu- lation are presented for these eight cities in the following table. The data are taken from the Census Mortality Statistics for 1916. City. Population. Deaths tinder 1 year. Rate per 10,000 population. Aurora Belleville... Chicago Decatur Evanston... Jacksonville Quincy Springfield.. Total... 34,204 21,149 ,497,722 39,631 28,721 15,481 36,798 61,120 2,734,826 55 39 6,910 75 44 26 57 119 16.08 18.43 27.66 18.92 15.32 16.79 15.38 19.46 7,325 26.78 The marked differences in these rates may result from a variety of influences in addition to those mentioned above. The Children's Bureau has shown that medical care at birth, nursing attention, character of feeding, nationality of mother, number and frequency of births, earn- ings of father, and other similiar influences diow a close correlation with infant mortality rates. The following table shows how the mortality rate declines as the family income increases. The table snows the combined figures for the eight cities in which the Children's Bureau made special investigations.^* "The Commission is indebted to the Children's Bureau for permission to use these unpublished data. "The eig-ht cities where surveys were conducted are: Johnstown, Pa., Man- chester, N. H., Saginaw, Mich., Waterbury, Conn., Brockton, Mass., New Bedford, Mass., Akron, Ohio, and Baltimore, Md. 67 Earnings of father. Infant mortality rate.* Less than $550 a year. $550 to $849 $850 to $1,049 $1,050 to $1,249 $1,250 and over 162.5 119.8 95.0 61.7 62.5 • See Report of CMef of Children's Bureau, 1917, pp. 14-15. It is not surprising that there is a close correlation between infant mortality rates and earnings, for the family income determines to a large extent the conditions under Avhich the infant lives, such as housing, character of food, and, in the main, the medical and nursing care, unless the latter are furnished as a free service. It is generally asserted that the death rates of infants are abnor- mally high, and that there are great possibilities of reducing these death rates, if the known methods of care were generally applied. All "Baby Saving Campaigns" are based upon this assumption. Within broad limits the truth of this assumption cannot be doubted, but the extent to which prevention can be carried varies greatly with the disease. This is shown by brief reference to scarlet fever, measles, whooping cough, diplitheria, and diarrhea and enteritis, which are '^children's diseases." The records of the Chicago Health Department show some very in- structive facts concerning these diseases and the possibility of reducing the death rates from them. First, in the case of scarlet fever the records show that during a period of 40 years (1875-1916) there have been recurring waves of high mortality rates at periods of approximately 5 years. Apparently those children who are unable to withstand the ravages of the disease die off and then the disease subsides until a new group of susceptible children comes on. Little is known of this disease, so that prevention is confined mainly to quarantine methods. The death rate in Chicago from this cause was 0.64 per 10,000 in 1916. Second, the death rate from diptheria has been greatly reduced since 1896 when the anti-toxin was first introduced. If cases are discovered in time and properly treated, the fatalities may be greatly reduced. The rate for Chicago in 1916 was 3.15 per 10,000 population, but the variation between wards was from 0.53 to 10.44. Third, the death rate from measles runs a close second to that of scarlet fever, which proves that the disease should not be regarded lightly. The rate in Chicago in 1916 was 0.52 per 10,000 as compared with 0.64 for scarlet fever. Fourth, much the same statement may be made for whooping cough as for measles. The rate for this disease in 1916 was 0.44 but in 1917 it was 0.828 which is higher than the rate for scarlet fever. Fifth, the diseases that cause the greatest number of deaths among children under 2 years of age are the gastric and intestinal diseases, among which diarrhea and enteritis are the most important. In 1916 the Health Department found that 3,450, or 40.9 per cent, of the 8,421 deaths of children under 2 were due to diarrhea and enteritis. Similar facts have been found in other localities where studies have been made. 68 The Children's Bureau found in Manchester, New Hampshire, that 38.4 per cent of all deaths of infants under 1 year were caused by enteritis. The disease is commonly regarded as a hot weather disease, as the death rate is higher during the three hottest months of the year and is always higher during summers of excessive heat than during summers of normal temperature. Whether the cause be one of heat or character of feeding, or both, the fact can be clearly demonstrated that the death rate is highest in the congested wards, and in wards in which the foreign population is concentrated. During the hot summer of 1916 the Chicago Health Department kept a spot map of deaths from this disease and three centers were clearly discernable, one in the Seventeenth Ward along Milwaukee Avenue, another west of the Eiver along the south branch of the Eiver running west to Western Avenue, and the third in the neighborhood of the Stockyards, where the number of deaths was very great. It is generally held by physicians and others competent to know that a very large reduction in the death rate from this disease can be effected. In fact, the Census Department has shown that the rate per 100,000 population of all ages for the registration area has declined from 108.8 in 1900 to 65.6 in 1916.*^ The death rates of children under two years of age from enteritis are shown for the ten cities with 500,000 population, or over, in the following table. DEATH RATES PER 100,000 OF POPULATION FOR CHILDREN UNDER 2 YEARS FROM ENTERITIS IN CITIES OF 500,000 POPULATION.* Year. New- York. Chi- cago. Phila- delphia. St. Louis. Boston Cleve- land. De- troit. Balti- more. Pitts- burgh. Los An- geles. 1916... 1915... 1914... 1913... 1912... 1911... 1906-10 1901-05 58.1 141.4 88.3 49.9 49.4 109.9 129.3 99.4 117. 81 72.2 112.7 90.0 45.0 62.9 103.5 97.0 83.0 97.6 67.1 131.1 107.4 61.3 64.6 108.1 122.2 101.5 103.7 73.5 142.0 100.6 72.6 72.9 133.0 106.0 101.5 134.8 82.4 139.1 93.4 69.1 84.8 140.4 99.1 91.5 113.5 92.6 132.6 118.0 87,2 106.4 133.6 98.6 104.2 130.3 133.8 138. 133.5 73.7 99.2 132.4 102.8 118.0 169.1 145.0 104.4 96.8 62.8 107.4 104.0 99.6 129.4 170.2 29.1 27.1 30.8 42.7 29.3 31.3 35.9 34.6 • Mortality Statistics 1916, p. 51. It is evident from these figures that in most of the cities there has' been a decline in the mortality rate. The figures do not furnish a satisfactory basis for comparison of rates between cities because of the different proportion of children in the total population. In this con- nection, it may be said, however, that the number of children under 2 years of age per 100,000 population in these cities, according to the Census of 1910, was as follows: New York 4,349.6; Chicago 4,208.5; Philadelphia 4,004.3; St. Louis 3,444.2; Boston 3,865.1; Cleveland 4,619; Detroit 4,273.3; Baltimore 3,554.4; Pittsburgh 4,420; Los Angeles 2,825.5. If these ratios of children under 2 years of age have remained approximately constant, it is evident that the showing of Chicago is not as favorable as for the four cities having a higher ratio *' Seventeenth Annual Report of U. S. Census Mortality Statistics, 1916, p. 50. 69 of children under 2 years of age than Chicago. New York had an annual average for 1901 to 1905 of 145 per 100,000, which was reduced to 58.1 in 1916. Chicago, on the other hand, had an increase from 104.4 to 141.4 for the same dates. It should be said, however, that^the summer of 1916 was exceedingly hot in Chicago and the rate of 141.4 was con- siderably in excess of the rate for 1915 (112.7). However, in view of the fact that these estimates are made on the same basis, and that all except Chicago and Detroit show a decline in rate, it would seem con- clusive that there is need for more effective treatment of this disease than has as yet been applied. Belief that the death rate can be reduced has led to the baby saving campaigns especially during the summer months. The need for work of this kind is not confined to these months as may be seen from the following figures : MONTHLY DEATHS FROM DIARRHEA AND ENTERITIS FOR 1917 AND 1918. Month. 1917 1918 January. . . February. . March April May June July August September. October. . . November . December. 166 147 *257 208 158 *142 200 *570 379 327 263 * Fig-ures for 5 weeks. Other figures are for 4 weeks. While the number of deaths is higher in August and September than the monthly averages, the above figures show that the number of deaths in otHer months is also large. In the light of these facts, this disease cannot be regarded as merely a hot weather disease. So far as care is an important factor in reducing the death rate, these figures point to the need for constant care throughout the entire year. Confidence in the possibility of preserving the lives of babies has led d, number of organizations, both private and public, to direct their energies into this work. The Elizabeth McCormick Memorial Fund is engaged primarily in an educational campaign. This organization collects and distributes literature that will help to spread information concerning more intelligent feeding and care of children. The Infant Welfare Society is organized very largely for the purpose of caring for children under two years of age. It was organized in 1911. The organ- ization maintains Infant Welfare Stations in various sections of the City, locating them where the need is greatest. In 1917, it employed 30 nurses. Conferences are held twice a week at the Infant Welfare Stations. The mothers bring their babies to the conferences and they are carefully examined by the attending physician.*^ If the physician 46 Physicians are employed to make the examinations at the conferences at the Infant Welfare Stations. 70 I discovers that a child is not developing properly, he instructs the mother as to feeding and care. The nurses visit the homes and show the mothers how to care for their children. The following summary from the annual Eeport of the Society for 1917 shows the amount of work done. Number of conferences held o'l cf Total number of babies cared for no'lno Visits made in the homes by nurses 72,973 The records of the Society show that the mortality of babies coming under the care of its physicians and nurses, has declined from 4.2 per cent in 1911 to 2.2 in 1918. The Visiting Xurse Association cooperates in. this work but does not confine its attention to children. In fact this organization turns many cases found in need of care over to the^ Infant Welfare Society. The City Health Department operates 4 Infant Welfare Stations. During the summer months the 149 school nurses are put into the child welfare work through the Department's own stations and in cooperation with the Infant Welfare Society. The most congested districts and localities showing at the time the highest death rates are given special service, and a house to house canvass is made. Cases of sickness thus located are cared for and, if the Department nurses are unable to do all work needed, the assistance of other organizations is solicited. The results of work of this kind are not always easy to measure concretely, but the Health Department found that comparing the sum- mers of 1912 and 1913 the increase in the death rate of children under 2 years of age from enteritis during the hot summer of 1913 in the congested wards where as many as 1,000 calls had been made by the nurses was less than in the wards not so covered. The Department figures are as follows: Death rate per 1,000 from enteritis. Year. Wards having 1,000 * Wards not or more calls. r covered. 1912.' .-^ 19.4 20.0 0.6 8.8 1913 10.7 Increase per 1,000, 1913 over 1912 1.9 These figures show an increase in mortality rate of 3.1 per cent in wards where nursing care was given and 21.6 per cent in wards where similar service was not furnished. Considering the fact that the nurs- ing service was furnished in the most congested districts, it would seem to show conclusively the possibilities of reducing high mortality rates found in these districts. Other agencies have obtained similar results from nursing care of this kind, not only in reducing infant mortality rates but in reducing mortality rates generally of those who receive the service. The most conspicuous example of service of this character furnished by a business concern is the nursing service of the Metropolitan Life Insurance Com- pany. Their nurses work among their own policyholders who are in the main in the wage-earning group. •^1 The 1917 report of the Company on its welfare work shows that the death rate among policyholders declined 6.8 per cent for all ages between 1911 and 1916. The rate declined 11.7 per cent for the ages 1 to 4 — the largest decline being 22.2 per cent for those 1 year of age. While the company has furnished a large amount of nursing service it has also carried on in connection with this service a wide-spread campaign of education by publishing and distributing leaflets on child care. Work similar to that described above is being carried on to some extent in some of the other cities and towns of the State. Several organ- izations have been found that devote part of their attention to this problem. There are about 100 public health nurses outside of Chicago and a majority of these devote a part of their time to infant welfare work. (8) Medical Care of School Children. The children of to-day will be the workers of the next generation. Their efficiency and mode of life then as well as their health while pupils will depend to no small extent upon the medical care and super- vision provided by the school authorities. Hence the importance of the medical inspection and care of school children in combating disease and conserving health. Health authorities have come to agree that if workmen are entitled to a safe place in which to work and to protection against health hazards, children^ especially under a compulsory school attendance law, are entitled to a safe place in which to study and to freedom from contact with those with communicable disease. Moreover, they agree that if it is well to locate physical defects in workmen so^ that in so far as possible these may be remedied, it is well to ascertain the physical defects of school children so that they may receive needed treatment. A resolution adopted by American boards of health at the Conference of State and Provincial Boards of Health, Los Angeles, California, in July, 1911, expresses the position taken with reference to this matter. The resolution adopted reads as follows : "We endorse legislation providing for the medical inspection of schools, because extended and varied experience has demonstrated that efficient medical inspection betters health iqonditions among school children, safeguards them from disease, renders them healthier, happier and more vigorous, and aims to insure for each child such physical and mental vitality as will best enable him to take full advantage of the free education offered by the state. "It is our judgment that every law providing for the medical in- spection of schools should also make provision for frequent inspections of the children by duly qualified school physicians to detect and exclude cases of contagious disease. "It should further provide for annual physical examinations of all the children by school physicians to detect any physical defects which may prevent the children from receiving the full benefit of their school work or which may require that the work be modified to avoid injury to the child. 72 "It should empower school physicians to conduct examinations of teachers and janitors and to make regular inspections of buildings, premises and drinking water to insure their sanitary condition. "We endorse the school nurse as a most valuable adjunct of medical inspection and believe that provision for the employment of school nurses should be included in each law." Leading educators are of the opinion that not only should there be medical inspection in schools for the detection of cases of contagious disease, but also annual physical examinations to detect other diseases and physical defects which should receive treatment and to indicate needed adaptation of school work; sight and hearing tests; nursing service not only in the schools but for follow-up work; and provision in school clinics and the like for such medical, dental and ophthalmic treatment as is needed to supplement that which the families can pro- vide privately for their children — all of this, of course, in addition to safe and sanitary, properly lighted, heated and ventilated school build- ings, proper provision for the teaching of hygiene, and proper pro- vision for exercise and physical training.*^ The state school laws in Illinois do not extend beyond a require- ment for teaching physiology and hygiene, the provision of proper hy- gienic, sanitary and safe conditions in respect to school buildings, the elimination of the common drinking cup, and provision for physical training in the public and in all normal schools. Vaccination, medical inspection, nursing service, and the establishment of clinics are left for local action under general powers vested in the health and school authorities. In these matters Illinois must be classed with a minority of the states, for no fewer than twenty-five have state laws relating to medical inspection of school children. Massachusetts (1906 and 1908), Louisi- ana (1908), New Jersey (1909), Colorado (1909), Xew York (1910 and 1913), Utah (1911), N'evada (1917), and Xorth Carolina (1917) have mandatory laws applying throughout the state. In addition to these states Washington (1909), Ohio (1910), Pennsylvania (1911), West Virginia (1911), and Wyoming (1915) have mandatory laws applying to cities of certain classes. Twelve other states have permissive laws setting certain standards where the local authorities exercise the ontion they have in the matter.'*'* Such investigations as the Commission has been able to make warrant the statement that "besides instruction in hygiene, in at least 95 per cent of the communities of the State (rural and urban) nothing systematic is done to promote the health of school children, except in time of epidemics. Then, the thing usually done (depending of course on the" nature and prevalence of the disease) is to close the school.""*^ Those communities doing more or less in a systematic way, have, perhaps, only about half of the school population of the State. " See e. g., Gulick and Ayres, ''Medical Inspection of Schools." "For an analysis of this legislation see W. G. Reeder, The Present Stat^ls of Health Work in the Public Schools of Illinois in Part II of this report. Special Report XIII. '•• See above reference. n Chicago (the second city in the United States to provide for school inspection), with inspection for contagious disease, with physical ex- amination of a minority of the public school pupils, with 120 nurses in the schools and for field and follow-up work, with school clinics, school dentists, and an ophthalmologist, and with special schools for the tuber- culous, has made the most extensive provision found in this State. However, it is after all limited as compared to the need. The provision is made by the Department of Health. Outside of Chicago, the Com- mission has found school physicians in 30 cities. In 9 of these and in 44 other cities one nurse (in 48 cases) or more than one are employed, but in only about half of these cases is follow-up work done outside of the schoolroom. Xineteen cities other than Chicago have provision for free medical and dental aid, 27 have provision for free medical aid only, and 20 for free dental aid only. These are cities and towns. In the rural schools practically nothing is being done. The number of cities and towns making provision for medical supervision, nursing care, and clinical treatment has rapidly increased in recent years; yet there is obviously a big gap between what educators regard as highly desirable and what some of the progressive states are requiring and what is being done in Illinois. The gap is really greater than has been indicated be- tween the desirable and the actual provision because in all but a few cases medical examination, nursing service, and clinical treatment supplementary to that which parents can provide privately are not com- bined into a well developed scheme.^° The importance of well developed and adequately supported service of this kind in the schools, is in no way better indicated than by the experience of Chicago. In 1915, Chicago school physicians made 87,099 visits to schools — 63,567 to public and 25,532 to parochial schools, and 1,128,232 inspections of children were made.^^ Of these, 962,130 were preliminary inspections for contagious diseases. In addition to these, 263,762 inspections for vaccinal status were made. In 1915, 70,729 cases of contagious diseases were found and 21,730 children were excluded from school to safeguard the health of others. In the same year physical examinations were made of 79,383 children. Of this number 37,356 were found to be defective and 32,860 were advised to seek treatment, and also were referred to the school nurses for follow-up work. The nature of the defects is worth presenting in detail. The Annual Review Number of the Department of Health may be quoted as follows : "A tabulation of the defects on 35,166 pupils shows the following: Malnutrition 804; anaemia, 2,639; enlarged glands, 7,970; goitre, 1,556; nervous diseases, 340; cardiac diseases, 414; pulmonary diseases, 68; skin diseases, 701; orthopedic defects, 171; rickets, 372; defective vision, 7,837; other diseases of the eye, 1,076; defective hearing, 663; dis- charging ear, 372; defective nasal breathing, 2,603; defective palate, ^ For details with reference to the cases of partial provision, inadequate number of nurses for the pupils enrolled, and the small amount per pupil being spent on the service provided, see report referred to above. *^ Facts taken from Annual Review Number (Bulletin No. 6) of the Depart- ment of Health, Chicago. u i Otl; defective teeth, 22,711; hypertrophied tonsils, 11,777; adenoids, 4,489; tonsils and adenoids, 4,350; mentality poor, 1,196; fair, 8,586. "During the year 263,762 out of 286,802 pupils were examined for their vaccinal status in 432 public and parochial schools; 65,344 re- quired vaccination; 34,824 received vaccination; 25,727 secured a typical result. The parents of 30,500 retfused to sign consent cards for vaccination. "The nurses made 62,945 visits to schools, of which 53,644 were to public schools and 9,301 to parochial schools; 775,970 pupils were inspected. Of these. 189,506 were preliminary inspections made at beginning of school term, and 337,543 routine inspections made during school sessions. In doing this work 3,603 suspect contagious diseases were found, 99,279 pupils were found needing attention, and 2,207 pupils that should have special examination for Fresh Air Eooms." The relative number of Chicago pupils with disease and defects requiring care in order that disease may be combated and health con- served is not unusual. In fact the data correspond rather closely to estimates for a typical community made by the Committee on Health Problems of the National Council of Education. Xor is the problem indicated a city problem only; the number of diseased and physically defective children is likely to be larger in the rural community.^^ (9) The Physician in Industry. Except for incidental references, the discussion in the preceding sections of this chapter has been limited to the health activities of public and semi-public officers and institutions. It is impossible to cover all health activities exhaustively. The summary undertaken would, how- ever, be inadequate unless a brief statement were incorporated relating to industrial medicine and surgery. There are in Illinois about 100 physicians who are known to special- ize in industrial medicine and surgery. By far the greater number are in Chicago but there is scarcely a city of any industrial importance in the State in which one or more are not found. Nearly all of them com- bine employment in business establishments with the usual private practice. A few in Chicago do industrial work for a number of small or medium-sized establishments but the usual practice is for the in- dustrial physician to take employment with only one large establishment, and here he usually has the assistance of from one to three physicians. What is known as industrial medicine and surgery is comparatively new. It is as yet by no means standardized; its importance in combating disease and conserving health is not shown by a large accomplishment but by its possibilities as revealed by what has been accomplished in as yet a comparatively few establishments. In not a few establishments departments of industrial medicine and surgery have grown out of the accident problem. In a relatively large number of cases whatever provision is being made is limited to injury cases arising in employment. But once physical examinations have been introduced and adequate care given in accident cases, a " For estimates made for the National Council of Education, shown by urban and rural communities, see report by Reeder, in Part II of this report. much larger problem and much larger possibilities have been revealed in connection with sickness and physical defects. The result has been that in a considerable number of instances the work has been reorgan- ized and extended to disabilities in general, however sustained. In- deed, a few cases have been found where the service in connection with accidents has become little more than an incident in the larger plan developed. And, over against departments with a development thus described, there have been many instances in which medical departments Avere organized to deal with sickness rather than accident problems. Physical examinations may disclose the applicants who would be a menace to others because of contagious or infectious disease (which ought to be and may be reported to the health authorities), or those for whom no suitable jobs can be found. In the best practice jobs are fitted to men; reexaminations are made as needed of those shown by first examinations or by careful supervision to be in poor health, or a semi-annual or annual examination is made of all employees as well as of those in poor health as needed ; suitable places are provided for those in need of a change of work; medical and perhaps personal advice are given to those who should have it; and care is exercised to see to it that the workmen concerned know what their ph3^sical condition is. In a few cases applicants for work are merely inspected for contagious disease; medical examinations are subsequently made to see that workmen have suitable employment. In respect to medical care the usual practice of the industrial physician is to give only "first aid" and to refer sick and disabled employees to a private doctor for needed treatment. In such cases the medical department developed is limited to a staff of examining and advisory physicians and the nursing and clinical service needed for first aid. There are, however, several mercantile and manufacturing estab- lishments, chiefly in Chicago, which have made more extensive provision because of the situation revealed hy experience. Xeeded operations may be arranged for; treatment may be given to employees when unable to pay for it; visiting nurses may be emplo3'ed to care for the sick in their homes; in at least two large and well-known establishments dental service has been introduced because of the importance of dental care and the inability or neglect of employees to secure it in private offices; and because of the importance of diet provision may be made for suitable lunches at reasonable prices or at less than "cost price." Industrial medicine on this plane becomes an institution, with the employees of the plant as the unit, to conserve health and to prolong the working life. Though it may involve some disadvantages which, however, need not be discussed at this point, it has in it great possi- bilities for the prevention of physical breakdown and scrapping of work- men. These possibilities are all the greater because the service leads rather directly to an examination into the causes of disease and to an effort to remove deficiencies in lighting, heating, ventilation, washing and toilet facilities, and the like in the plant. As industrial medicine develops into the type in which we are interested here, it calls for the sanitary engineer. The possibilities of industrial medicine when not used largely or merely for the selection of the most desirable applicants for work, are not less great and are perhaps greater than the possibilities of the medical supervision of school children. In the ^bove sections an attempt has been made to indicate briefly what is being done in Illinois to combat disease and to conserve health. It is recognized of course that the services given by the doctor, the hospital, the dispensary, and the nurse are important in this con- nection. These are discussed in the pages immediately following. 77 CHAPTER III. THE CARE OF THE SICK. In the chapter immediately preceding something has been said of the care of the tuberculonS;, of the treatment of those afflicted with venereal disease, and of infant welfare work. In this chapter the results of the Commission's investigations of medical treatment, the public dispensaries, hospitals and nursing are presented in summary form. (1) Medical Treatment. ■ According to the census made by the American Medical Asso- ciation there are (September, 1918) in Illinois some 10,909^ physicians licensed to practice medicine. This is one physician per 574 of popu- lation as against one to each 691 in the United States as a whole in 1916.^ To the licensed physicians must be added several hundred mid- wives — 574^ or more in Chicago and small numbers in other parts of the State where foreign groups reside in considerable numbers, and Christian Science and numerous other unlicensed practitioners. The licensed physicians are distributed fairly well over the State according to the amount of general medical work to be done.* The great majority of the specialists, and also of the unlicensed practitioners are in Chicago. Among the first of its investigations the Commission sought data relating to the economics of the medical profession. Questionnaires were delivered to 8,939 licensed physicians in practice. The questions related to their training, experience, character of practice, schedule of fees, charity practice, gross income from practice, professional expenses, and" net income. All told 2,316 replies were received. This number was not as large as desired and there is reason to believe that they were not entirely representative of the profession as a whole. In secur- ing these returns the cooperation of the Illinois State Medical Society was of distinct assistance. This aid brought a relatively larger number of returns from those who have membership in the Society which is about half of the total in the State. This has caused a relative excess of returns from physicians with large practice and the larger incomes. Hence the data must be used holding in mind that the returns are not as numerous a-s they should have been and that relatively too few replies have been received from physicians with offices in working-class com- munities in Chicago and some of the larger cities of second rank. 1 As given in list prepared by the American Medical Association. Of the 10,909, 1,533 were in military service. 2 Statistics Regarding the Medical Profession, p. 5. Compiled by the. Committee on Social Insurance, American Medical Association. According to this report (p. 12), Illinois ranked fifth among the states (sixth if the District of Columbia is in- cluded), in number of physicians relative to population. 3 The State Council of Defense has compiled a list of 574 mid-wives in Chicago. "* According to the American Medical Association the number of persons per physician varied from 439 in Stark to 1,121 in Pope County. The corresponding number for Cook County (total number of physicians, 5,667) was 497. m 78 ^ The medical fees in general practice were found to vary considerably, but not greatly from one part of the State to another. The most fre- quent charge for an office visit was $1.00, for a house call $2.00, with $1.Q0 added for a night call. The variations, most numerous in Chicago, were chiefly in an upward direction.^ Since the investigation was made there have been advances of rates in many communities, frequently of fifty per cent. Naturally the gross incomes from practice vary widely with the differences in experience, abilit}^, and opportunities of the physicians. So do their professional expenses and their net incomes. The gross incomes from practice, with salaries for teaching and fees for work done for insurance companies added in a considerable percentage of cases, were found to average $4,617 per year in Chicago, $5,490 in other cities with populations of 10,000 or over, and $3,665 in places with smaller populations. For the reason stated above, the first two averages must be regarded as exaggerated. The other should be approximately correct, however, for the returns were sufficient in number and sufficiently repre- sentative to give a correct average. In securing the relation between gross income, professional ex- penses and net income, only those returns have been used which were evidently made from the accounts which were said to be kept. Hence, only 790 of the 2,316 returns have been accepted. In Chicago the pro- fessional expenses averaged 35.7 per cent of the gross income, in other cities with populations of 10,000 and over, 34.5 per cent, in smaller places, 34.1 per cent. The net incomes averaged $3,296 in Chicago, $4,290 in Peoria, Springfield and the other cities of second rank, and $2,892 in the smaller places. Here again, of ^^rse, the averages for Chicago and cities of second rank are exaggerated because of the in- clusion of too few of those with practice largely confined to the poorer residents of their localities. Moreover, the averages are based upon a comparatively small number of returns and should be used accordingly. It would appear, however, that the net incomes realized from the licensed practice of medicine are not excessive in view of the ability and extensive and expensive training required and the conditions under which the work is done.^ Thus far only averages of gross and net incomes have been given. Additional data may be desired, and, hence, are presented in the follow- ing tables. The first shows, by specified groups, the gross earnings from practice reported by 2,316, the second the net incomes realized by 790. ' The following tabulation shows the variations in fees for office visits and day calls : Number reporting Number reporting Rate. for office visits. for day calls. 50 cents 15 1 75 cents 7 1 1100 561 66 1-50 24 82 2-00 120 491 2.50 7 3.00 :..:;: -27 154 Over $3.00 3 34 Total reporting 757 836 "For some data bearing upon the incomes of doctors and other professional men, see Statistics Regarding the Medical Profession, pp. 81-87. 79 GROSS INCOME FROM PRACTICE IN 1917 BY POPULATION OF LOCALITIES. Gross incomes from practice. Number in Chicago. Number in cities with Number Number 10, 000 or in places from Number over under unknown in State. (Chicago 10,000. places. 1 excepted). I Percent- age. Under $500 $ 500 to « 599 600 to 699 700 to 799 800 to 899 900 to 999 1,000 to 1,199 1, 200 to 1, 399 1,400 to 1,599 1,600 to 1,799 1,800 to 1,999 2, 000 to 2, 249 2, 250 to 2, 449 , 2, 500 to 2, 749 2, 750 to 2, 999 3,000 to 3,499 3, 500 to 3, 999 4, 000 to 4,499 4,500 to 4,999 5, 000 to 5, 999 6,000 to 6,999 7, 000 to 7, 999 8, 000 to 8, 999 9, 000 to 9, 999 10,000 to 11,999 12,000 to 13,999 14, 000 to 15, 999 16,000 to 17,999 18,000 to 19,999 20,000 and over On salary Income not reported Total Reporting other professional income 14 3 5 3 9 28 13 1 6 1 2 16 6 3 2 1 5 5 13 10 1 11 3 6 2 22 21 6 21 2 50 18 13 31 1 63 22 6 27 4 59 19 8 23 2 52 48 20 38 8 114 55 19 55 8 137 24 11 28 5 68 40 17 48 9 114 22 16 29 6 73 81 44 72 11 208 42 28 71 5 146 65 29 59 11 164 48 16 48 9 121 59 44 63 4 170 55 34 48 5 142 30 23 26 1 80 21 18 12 4 55 10 27 10 22 5 12 25 62 1 19 15 2 1 37 7 10 2 19 4 4 8 19 2 } 18 6 6 18 40 1 3 2 1 84 34 59 8 185 895 486 822 113 2,316 969 366 179 381 43 5.9 2.9 4.9 3.1 8.9 6.3 7.1 5.2 7.3 6.1 3.4 2.3 1.1 2.7 1.6 0.8 0.2 0.2 0.8 1.7 8.0 There is little of what may be called "organized practice of medi- cine" in Illinois. With few exceptions families call physicians of their choice, or, calling none, neglect needed treatment, buy nostrums or take the advice of friends or acquaintances in securing medicines required for self-treatment. Of course patent medi.cines are extensively pur- chased and used. The Commission has, however, made no investigation of this except in its studies of wage-earning and other families in Chicago. These showed what was known without investigation, viz. that many resort to self-treatment. Xor has the Commission attempted to make any investigation of unethical practices in medicine by licensed physicians or others. Some evidence of unethical practice has come to the attention of the Commission's staff of investigators when using the records kept by social agencies, but it is not sufficient to warrant any conclusion except that at times advantage is taken of the situation to charge unreasonable fees, especially for operations. In the absence of data collected by its staff, the Commission may quote from an article recently published by the Director of Eegistration and Education.'^ His department is charged with the enforcement of the Medical Practice Act. In view of the find- '' See Joiirnal of the American Medical Association, November 16, 1918, pp. 1629-1630. 80 ings of his staff in the administration of this act, the Director writes, in part, as follows : "They (the officers of the Department) found an army of adver- tising charlatans, some with fixed offices and others appearing 'for one day only,' making extravagant claims of curative skill in handling all diseases, specialists in everything, blatant fakers, robbing the poor and ignorant, preying on the superstitions of gullible foreigners " * * NET INCOME OF 790 ILLINOIS PHYSICIANS FOR YEAR 1917. Gross Incomes from practice. Number in Chicago. Number in cities with 10, 000 or Qver (Chicago excepted). Number in places under 10,000. Number from unknown places. Number in state. Percent- age. Under $500 5 5 4 4 3 4 14 4 14 7 11 11 17 15 7 15 23 13 12 15 9 5 1 1 6 1 2 4 5 6 12 20 24 19 22 27 27 24 20 23 18 15 14 12 6 4 1 1 2 12 6 6 8 9 13 30 38 49 41 51 57 52 55 34 57 60 45 37 49 30 16 4 5 13 5 2 2 1 3 1.5 1 500 to $ 599 0.8 600 to 699 0.8 700 to 799 1.0 800 to 899 1 2 4 11 9 10 13 16 7 13 6 14 18 13 11 21 15 6 2 4 4 4 1.1 900 to 999 1 1.6 1,000 to 1,199 3.8 1,200 to 1,399 3 2 5 5 3 1 3 1 5 1 4 4.8 1,400 to 1,599 6.2 1,600 to 1,799 5 2 1,800 to 1,999 6 4 2,000 to 2,249 7.2 2, 250 to 2, 499 6.6 2, 500 to 2, 749 6.9 2, 750 to 2, 999 4 3 3, 000 to 3, 499 7.2 3, 500 to 3, 999 7.6 4,000 to 4,499 5.7 4,500 to 4,999 4.6 5, 000 to 5, 999 1 6.2 6,000 to 6,999 3.8 7, 000 to 7, 999 1 2 8, 000 to 8, 999 0.5 9, 000 to 9, 999 0.6 10,000 to 11,999 1 1 1 1.6 12,000 to 13,999 0.6 14,000 to 15,999 1 0.3 16,000 to 17,999 2 0.3 18,000 to 19,999 1 0.1 20,000 and over 3 0.4 Total 227 210 316 37 790 100.0 "They found a motley array of so-called ^doctors,' of every name and cult under the sun; regulars, homeopaths, eclectics, osteopaths, chiropractors, napropaths, spondylotherapaths, mechanotherapaths, neur- otherapaths, electrotherapaths, hydrotherapaths, suggestive therapaths, psycotherapaths, naturotherapaths, iridologists, magnetic healers, re- ligious healers, and many other varieties * * * "They found chains of doctors' offices, managed by real estate agents or other noiipractitioners and attended by licensed physicians who were paid from $8 a week to $35, with a possible commission of 10 per cent on all gross business over $500 a week; the manager getting all the receipts, paying rent, furnishing light and providing equipment; * * * the offices using common literature, apparently printed by the ton, distributed by hand in mail boxes and front yards, and bearing the name of the doctor nearest the region of distribution, who for himself 81 was unable to read the circular in the language used, and so knew nothing of the glowing promises made to his prospective patients * * * "Thej found doctors, all over the state, who were guilty of unethical practices, w^ho were known to be quacks of the worst type * * * "They found men and w^omen in many places in Illinois practicing medicine without license and defying the provisions of the Medical Practice Act/' These statements, it should be carefully noted, are with reference to persons, trained or untrained, licensed or unlicensed, regulated or unregulated, offering their services to the sick and injured. There is no reason to think that the situation is different from that found in most of the other states. There can be no doubt that the training and ethical code of the great mass of physicians are such as merit only com- mendation. The quotations are designed merely to indicate that there is a problem in the behavior of a relatively small but not negligible minority which remains to be solved. Much testimony was presented to the Commission at its hearings bearing upon the adequacy of medical facilities and attention. It showed considerable disagreement as to some of the facts, a disagreement evidently due in part, however, to differences in what is meant by "adequacy." It is evidently true that the services of the general practitioner are available to all who seek his services in the average community where the population is fairly stable and where the old-time family relation generally obtains between the sick and the doctor. Ability to pay makes no difference to the doctors who do "charity work'' when necessary and seems to cause little disinclination on the part of those sick and unable to pay at once to call upon the physician of their choice in cases of serious sickness.® In the larger centers, and especially in Chicago where both wage-earners and physicians frequently move from one locality to an- other, the situation appears to be somewhat different. Though here most physicians freely offer their services when called, the old-time relation between the doctor and the family, and especially the wage-earning family, has pretty much disappeared. Social workers, including the officers of charity organizations and visiting nurses, are almost, if not quite, unanimous in the statement that frequently when sickness comes there is no family doctor to call, there may be hesitancy to call strange physicians because of inability to pay at once, sometimes payment at once is demanded, and not infrequently the sick who can pay fall into the hands of undesirable practitioners. Of course the "poor doctor" is available and the philanthropic societies and dispensaries stand ready * Of 2,014 physicians reporting- to the Commission the extent of their ''charity- practice," only 78 reported "none." Of the others 407 reported percentages less than five; 500, five but less than ten; 512, ten but less than fifteen; 122. fifteen but less than twenty; 147, twenty but less than twenty-five; 114, twenty-five but less than thirty; 47, thirty but less than thirty-five; the remaining 85, various percent- ages ranging upward from thirty-five. The estimates from Chicago physicians are in harmony with the results of the Commission's family studies. The smallest charity practice was reported by physicians located in places with populations under 10,000, a fact explained by the relatively smaller percentage of the less well-off in their communities. —6 H I 82 to supply the needed treatment. Under existing circumstances these opportunities are frequently unknown or available only after delay and perhaps with inconvenience. Moreover there may be disinclination, except in an emergency, to accept service tainted by charity. The Commission is unable to state how far medical treatment is inadequate because of this situation. While the results of investigations elsewhere, as in Rochester,^ showing a great many sick and without medical treatment, may apply equally well in Illinois, they show little with reference to the inadequacy of medical facilities. Illness may not be of such character as to require medical treatment at the time; the absence of treatment may be due to neglect on the part of the family or the wide-spread habit of self-treatment. It is undoubtedly true, how- ever, that there is much more neglect of needed treatment, much more use of nostrums, more frequent calling of unlicensed practitioners, more opportunity for the charlatan, and more opportunity for unethical practice than there would be under an organized system of medicine under which the charges of the physician would be in effect definitely standardized, and the sick embraced within the organization could have service without additional cost (over dues already paid.) What has been said thus far concerning the adequacy of medical facilities and treatment relates to the availability of the general practi- tioner. The important deficiencies, however, are found in the absence in many cases of adequate diagnostic facilities and the inability of the great majorit}^ of families, whether wage-earning or not, to secure the service of specialists, except on a charity basis. Unquestionably there is a big gap between that which medical science has made possible and that which the average family gets at the present time. In the smaller places in which half of the people of Illinois live there are neither good diagnostic facilities nor more than a few well-trained specialists. Few of the sick can afford to go where these are available. In the larger places, the good facilities and services at hand are made available chiefly to charity patients through dispensaries and hospitals and to the very well-to-do, who alone can pay the regular schedule of fees charged by the specialists and the incidental laboratory fees. The great majority of families have only the service of a general doctor. As a rule this doctor, under the individualistic practice of medi- cine which generally prevails, is not in working relations with specialists, and does not use the diagnostic facilities to be found in the community, most likely because the most important are not accessible to him. In- dustrial physicians have stated in their reports to the Commission that the great majority of wage-earners when in need of operations and of treatment by specialists have not had the service. They usually state, also, that they find it difficult to arrange for these when physical examin- ation reveals their need. As has been pointed out above some of the large establishments are taking steps to bridge this gap so far as their em- ployees are concerned. In connection with what has been said with reference to the existing inadequacy, it should be stated that at present there are available only » See Surveys made by the Metropolitan Insurance Company, cited above. 83 a limited number of well-trained specialists. The supply is adjusted to the opportunity, for the amount of such practice is limited and for economic reasons, under the existing organization of medicine. (2) Hospital Service in Illinois. In the provision of adequate medical service, hospitals have an important role. With the development of modern medicine and surgery they become a more and more necessary part of the community's equip- ment for the efficient care of the sick. Not only do they furnish facilities for medical and surgical work which cannot well be done outside a hospital's walls but they are important from the standpoint of economy, in the common and frequent use of expensive equipment and other diagnostic and therapeutic facilities not otherwise available for many doctors. Economy is further promoted by the hospital in the con- servation of the time of the physician which it makes possible. The physician .who serves most of his patients in the hospital can make far more efficient use of his time and energy than can he who treats most of his patients in their homes. From the standpoint of the patient the hospital's chief value lies in the type and quality of service which it places at his disposal and in the ready access it may furnish to whatever special treatment his condition may demand. In brief, the hospital provides the basis for efficient medical service because it is organized for that purpose. For purposes of classification, hospitals may be divided into two groups — general hospitals and special hospitals. A general hospital is one to which patients needing practically any type of hospital service are admitted. There are frequent exceptions, however; few general hospitals admitting patients suffering from contagious or chronic diseases. . A special hospital is one organized for the treatment of some one disease or related group of diseases, such as tuberculosis or nervous disorders, or of a restricted group of patients, for example — children. In relation to their support, hospitals may be either public or private. In this sense, a public hospital is one which is supported by the state, county or municipality from the public funds. A private hospital may be privately owned and operated for profit or it may be supported in part by contributions and endowments and conducted not for profit. Most public hospitals are open to charity patients only. Most private hospitals receive both pay and free patients. A few private hospitals receive some public support in return for treatment of indigent persons. In order to learn something of the extent of the hospital facilities of Illinois, the types of hospitals existing, the number of patients treated, the rates charged for hos})ital service, and other information bearing upon the general subject of its investigations, the Commission sent a questionnaire to every known hospital in the State. All but a few replied. A considerable number of those reporting gave incomplete information. Frequently the information obtained did not check with data collected by the American Medical Association and the Modern Hospital.. Hence the statistics given below are incomplete and somewhat 84 inaccurate. However, the percentage of error is not great enough to affect the conclusions which may be drawn from them. HOSPITAL BEDS IN ILLINOIS. Number of beds in general hospitals. Number of beds in special hospitals. Total. Chicago Illinois (exclusive of Chicago) Total 9,583 7,018 16,601 2,608 1,913 4,521 12, 191 8,931 21,122 These are exclusive of state hospitals for the insane, hospitals in prisons, jails, and reformatories, and hospitals maintained by the United States Government for soldiers and sailors. Taken in relation to popu- lation these figures show that Illinois has 3.3 hospitals beds per 1,000 inhabitants. The ratio for Chicago is 4.4 and for the rest of the State 2.2. In point of numbers and in relation to general community need, the privately conducted general hospitals are worthy of first con- sideration. In the large cities these hospitals are frequently maintained by corporations organized not for profit. They are dependent only in part on fees paid by patients; contributions and income from invested funds providing a considerable part of the money necessary for their maintenance. Most of these hospitals provide accommodations at rates varying from expensive private room charges, through lesser rates in two and four bed wards to moderate fees and entirely free service in the larger wards. In most of these hospitals the private room patient has his own physician whose fees for medical or surgical service are entirely separate from the fees paid the hospital for board, room, laboratory work, etc. Patients in wards are frequently known as "house cases." They do not as a rule have their own physician but are given medical treatment by some member of the hospital staff who is usually not com- pensated for this service. The one fee paid for a ward bed covers room, board, medical, and general nursing service. There are sometimes small charges made to cover laboratory and operating room expense and in some hospitals, ward patients, who are able, pay the attending physicians small fees. In smaller cities there is less likely to be any considerable support of hospitals from contributions and endowments. Consequently the hospitals in such communities must meet most of their operating expense from fees paid by patients. This means that a smaller percentage of their service can be free or even moderately priced. Eea^ardless of com- munity need, a hospital must meet its bills or close its doors. The following tables show the distribution of beds and rates for service in private general hospitals. 85 DIlSTRrBUTiON OF BEDS IN PRIVATELY CONDUCTED GENERAL, HOSPITALS. Number of hospitals reporting. Number of beds in wards of 5 beds or over. Number of beds in 3 or 4 bed wards. Number of beds in 2 bed wards. Number of beds in sin- gle rooms. Total. Chicago 34 27 29 1,593 502 71 664 311 124 484 288 85 1,327 813 547 4,068 1,914 827 Cities of 10,000 population or over — exclusive of Chicago Towns with less than 10,000 population Total 90 2,166 1,099 857 2,687 6,809 The following table shows the rates for service in large wards, small wards and single rooms. RATES FOR SERVICE IN PRIVATELY CONDUCTED GENERAL HOSPITALS. CHICAGO. Type of service. Minimum weekly rate. Number of hospitals. Five bed ward or larger $10.00 and under 14 $10.50 to $14.00 17 $15.00 to $17.50 6 $10.00 to $14.00 Three or four bed ward 37 21 $15.00 to $19.00 16 $20.00 to $21 .00 2 $12.00 to $14.00 Two bed ward 39 4 $15.00 to $19.25 28 $20.00 to $24.50 5 $12.00 Single room 37 1 $15.00 to $19.25 15 $20.00 to $24.50 16 $25.00 to $29.00 12 $30.00 to $31.50 2 46 86 RATES FOR SERVICE IN PRIVATELY CONDUCTED GENERAL. HOSPITALS — Concluded. CITIES OF 10,000 POPULATION AND OVER EXCLUSIVE OF CHICAGO. Type of service. Minimum weekly rate. Number of hospitals. Five bed ward or larger. Three or four bed ward . Two bed ward. Single room . $10.00 and under $10.50 to $14.00.- $15.00 to $17.50. . $ 6.00 to $ 9.00. . $10.00 to $14.00. . $15.00 to $19.50. . $ 8.00 to $11.50.. $12.00 to $14.00.. $15.00 to $19.25.. $20.00 to $21.00.. $ 9.00 to $14.00. . $15.00 to $19.25. . $20.00 to $24.50. . $25.00 to $29.00.. $30.00 to $31.50. . 22 12 2 36 11 23 6 <■ 40 13 8 8 4 33 14 23 7 1 45 TOVP-NS UNDER 10,000 IN POPULATION. Type of service. Minimum weekly rate. Number of hospitals. Five bed ward or larger $10.00 and under , 9 $10.50 to $14.00 5 $15.00 to $20.00 4 $ 6.00 to $ 9.00 Three or four bed ward 18 4 $10.00 to $14.00 11 $15.00 to $19.50 9 $20.00 to $25.00 1 $ 6.00 to $11.50 Two bed ward 25 6 $12.00 to $14.00 6 $15.00 to $19.25 9 $20.00 to $25.00 5 $ 5.00 to $14.00 ... Single rooms 25 11 $15.00 to $19.25 13 $20.00 to $24.50 7 $25.00 to $29.00 8 $30.00 to $35.00 4 • 43 These tables show that Chicago has a much larger proportion of beds in larger wards and consequently at rates more easily within the reach of wage earners than have the other cities of the State. Cities of 10,000 or over have a much larger proportion of these cheaper beds 87 than have the smaller towns. Eates for similar types of service in Chicago and the other cities and towns of the State do not vary so much as might be expected. In some instances rates are lower in the smaller cities but the number of beds available at these lower rates is very limited. PAY, PART-PAY AND FREE SERVICE IN PRIVATELY CONDUCTED GENERAL. HOSPITALS. Number of Number of Number of Number of pay part pay free hospitals patients patients patients reporting. in last in last in last fiscal year. fiscal year. fiscal year. Total. Chicago Cities of 10,000 population and over, ex- clusive of Chicago Towns of under 10,000 population — Total 35 35 36 73,789 49,851 12,312 11,343 3,379 752 20,766 4,582 468 106 135,952 15,474 25,816 105,898 57,812 13,532 177,242 Stated as percentages these figures yield the following : Pay patients— per cent. Part-pay patients — per cent. Free patients— per cent. Chicago Other large cities Towns 70 86 91 11 6 6 19 8 3 The number of hospitals having these three types of service are shown in the following table. Number of hospitals reporting. Having only pay patients. Having some part-pay patients. Having some free patients. Having no free patients. Chicago Other large cities Towns Total 35 4 26 28 35 4 26 29 36 16 14 19 106 24 66 76 7 6 17 30 From the above tables it will be seen that Chicago has practically twice as large a percentage of part-pay patients in its privately con- ducted general hospitals as have the other communities of the State and its proportion of free patients is more than twice that of other cities of 10,000 population and over, and more than six times that of towns under 10,000. In Chicago, only one privately conducted general hospital out of 46 reporting, received any public support. Twenty out of the same number reported the receipt of gifts ranging from $250.00 to $209,360.00. Twelve of the 46 receive some income from endowment funds. Of 43 reporting, 21 stated that they are self-supporting. In cities of 10,000 88 and over, exclu^!v^^^hicago, 19, out of 41 reporting, received public support ranging from $98.00 to $3,000.00 during the last fiscal year. Sixteen out of 39 reported gifts ranging from $72.00 to $12,494.00. Nine out of 38 received some income from endoAvments. In towns of under 10,000 population, 13 out of 37 reported receiving public support ranging from $15.00 to $8,000.00. Nine out of 36 received gifts rang- ing from $10.00 to $5,620.00. Five reported small endowments. These figures show that hospitals in the larger cities of the State receive substantial financial support from other sources than patients, but that in smaller cities and towns the hospitals to a far greater degree must be self-supporting. To accomplish this end, they must very de- cidedly limit their number of free and part-pay patients. It is not the number of hospital beds in a community but the use that is made of those beds that measures the value of the hospitals to the people. The unit of hospital service is the hospital day. A hospital day is one day of hospital service for one patient. The following table shows the actual service of the privately conducted general hospitals in terms of this unit and also the maximum possible amount of service, for the last fiscal year. Number of hospitals reporting. Number of beds. Actual number of hospital days. Maximum possible hospital days. Percentage of use of maximum facilities. Chicago Other large cities Towns Total 38 33 28 99 4,963 2,650 820 8,333 1.100,393 541,080 142,145 1,783,618 1,811,495 930,750 299,300 3,041,545 60.7 58.1 47.5 58.6 These figures indicate that in the 38 Chicago hospitals reporting the daily average number of vacant beds was 1,950 or 40 per cent of the total number of beds available.* The 33 hospitals in the other large cities of the State had a daily average of 1,071 empty beds, or 42 per cent; while in towns of less than 10,000 population there was a daily average of 434 empty beds or 53 per cent in the 28 hospitals reporting. If the averages shown in the above table for 99 hospitals are representative of conditions throughout the State, as they undoubtedly are, the number of hospital beds used during the last fiscal year bear the following ratios to 1,000 population. Chicago 2.67 The State exclusive of Chicago 1.22 The State as a whole 1.95 The facts just presented raise the question why there is such a high average of beds not used ? The answer may be sought in more than one condition. Overbuilding is suggested, but it is interesting to note in this connection that according to statistics compiled and published by the Modem Hospital, Illinois has but 62 per cent as many beds per unit of population as has the United States as a whole. For a part of the cause we must go back to the problem of support. A hospital can afford to keep its beds filled with patients who pay rates which cover or more than cover costs. Free and part-pay patients are cared for at a 89 loss, of course. Unless the deficit their treatment entails is met through public or private contributions, the number of such patients which a hospital can serve must be limited. Under existing conditions there are sure to be empty hospital beds and sick people needing hospital care at the same time in the same community. Of course this situation applies to the pay beds in private hospitals. Another cause of this condition, even in public hospitals, lies in hospital organization and construction. Free and moderately priced beds are for the most part in the larger wards. In a general hospital there may be a men's medical ward, a women's medical ward, a children's ward, etc. There may be a long waiting list of patients for the men's medical ward and at the same time empty bed's in the women's medical ward and in the men's surgical ward. If it were possible to construct hospitals with all or most of their beds in single rooms and to maintain them at a moderate cost, and some hospital authorities believe it can be done, this state of affairs would be largely obviated, and the use of the hospital would much more nearly approxi- mate its capacity. There are in the State a number of general hospitals supported by counties and municipalities out of the public funds. Eeports from seven of these gave a bed capacity of 2,936. The total number of patients treated during the last fiscal year in these seven hospitals was 17,283. Service in four of these seven hospitals is entirely free. They are public charity hospitals. In the other three there is a limited number of beds in private rooms and small wards, available at rates from $10 to $35 per week. In addition to the general hospitals described above, there are a considerable number of special hospitals in Illinois. Of the 20,341 hospital beds in the State, 3,740 or 18 per cent are in special hospitals. The Commission received fairly complete reports from 37 of these special hospitals. Their classification, capacity and location are shown in the following table. SPECIAL. HOSPITALS. Type. Number. Number in Chicago. Number in other parts of Illinois. Number of beds. Tuberculosis Contagious Eye, ear, nose and throat Emergency Children's Nervous and mental Maternity Total 9 2 7 6 4 2 4 2 2 2 4 2 3 1 6 6 6 6 37 19 18 1,958 506 285 133 439 235 225 3,779 This table shows that the number of these special hospitals is about evenly divided between Chicago and the rest of the State. The disparity becomes evident when we consider that 2,471 of the 3,779 beds in this special group of hospitals are in Chicago institutions. A much higher percentage of the service in these special hospitals is free than is the case with the general hospitals. 90 The data the Commission has been able to collect concerning the hospitals of Illinois, seem to indicate in the first place, that valuable as is the service which the hospitals are rendering, the hospital facilities of the State are inadequate. In the second place, because of high main- tenance costs, methods of distribution of beds in hospitals and perhaps for less obvious reasons, there is a daily average use of less than 60 per cent of the hospital beds throughout the State. The small wage-earner, needing hospital service for himself or for some member of his family, can hardly aiford individually to pay a rate covering the actual cost to the hospital of the service it renders, to say nothing of paying the physician for his services. He must pay a rate beyond his means, accept charity service if he can get it, or go without hospital service altogether. From the standpoint of the hospitals, few of them can afford to provide beds in any considerable number at a rate which wage-earners seem able to pay. (3) Dispensaries and Climes. In the larger cities many poor people and members of the low income group obtain medical and dental service in dispensaries and out-patient departments of hospitals. Generally speaking, dispensaries treat ambulatory patients only. Hence, their patients come for relief from minor ailments, for treatment of diseases in their incipient stages and of diseases which do not confine patients to their beds or their homes. This group embraces a much larger element of the sick than does the group needing hospital care or the services of a physician in their homes. The dispensary originated and to a large extent exists to-day as a charitable institution whose function is to provide medical treatment for the poor. Unlike the hospital, the dispensary has not developed to meet the needs of all classes in the community, but has been kept closed to a large element of the population who are unable to secure as good medical service as do those poorer people to whom the dispensary ministers. However, there is developing a tendency to make dispensary service available for people who are not indigent, but who, nevertheless, are not able to pay for adequate medical treatment. Some of the older and larger dispensaries are connected with medical and dental schools, and their clinics like those of hospitals similarly connected, are used in teaching medical students. Some dispensaries are conducted by and in connection with institutional churches, social settlements and other social institutions. Some are out-patient departments of hospitals while others are separate institutions not identified with hospital, medical school, church, settlement or other agency. With the development of industrial medicine and surgery, certain industries and casualty insurance companies have established dispensaries for the treatment of sick or in- jured employees or policyholders. Dispensaries, like hospitals, may be divided into two classes^ — general and special; their chief difference lying in the fact that the general dispensary is open for the treatment of sick people irrespective of type of disease or age or sex of patients while the special dispensary may treat some one disease only, as tuberculosis or some limited class of patients, as children. 91 Dispensaries may be supported in one or more of several ways. In most of them patients who are able, pay small fees for service, medicines, special appliances, etc. Some have small endowments or receive con- tributions from persons interested in this form of philanthropy. Others are supported as an integral part of a medical school, hospital, church or other institution. A few dispensaries in Illinois are supported out of the public funds. As a rule, dispensaries have not been well supported, and as a result, have not been able to render the efficient service their type of organization makes easily possible. Eealizing that a large number of people, especially in Chicago, receive medical treatment in dispensaries and that among this number are many wage-earners and members of their families, the Commission made a survey of the dispensaries of the State, inquiring into the volume of their medical work, its nature, their equipment for its efficient per- formance, who their patients are, how the institutions are supported and other information related to its general problem of sickness among em- ployed people. Inasmuch as a detailed statement of the results of this survey is published in Part II of this report,^° it will suffice here to set forth only the general conclusions relating to the care of the sick. Ninety-eight dispensaries and clinics of 'various types were located and studied. ^^ Their classification and distribution are shown in the following table : , Chicago. Rest of the state. Total. General 19 44 8 27 27 Special 71 Total. 63 35 98 Outside of Chicago there are general dispensaries in Springfield, Evanston, Oak Park, Eock Island, Peoria, Rockford, Argo and Blue Island. The special dispensaries existing in Illinois are divided into the following classes : — ^Tuberculosis, Eye, Ear, Nose and Throat, Venereal Disease, Obstetrics, Diseases of Women and Children and Orthopedics. Outside of Chicago practically only two of these types are found — Tuber- culosis and Orthopedic dispensaries. There are four dental dispensaries in Chicago, all maintained by dental schools. Schools of osteopathy, naprapathy, chiropractic, etc. maintain dispensaries in relation to their clinical teaching. The work of the more important of the special dispensaries has been commented on earlier in this report. At this point that of the general dispensaries alone requires brief discussion. Most general dispensaries are organized on the basis of medical specialties. They may have all or nearly all of the following clinics or departments — general medicine, surgery, genito-urinary, gynecology, dermatology, laryngology, ophthalmology, neurology and paediatrics. Further specialization within these departments is found in some dis- ^"See Special Report III. " This is exclusive of those maintained by city physicians. 92 pensaries. It is in this organization of the dispensary that one of its chief vahies lies. The dispensary patient receives the benefit of the knowledge and skill of whatever type of specialist his condition may indicate. The unit of dispensary service is a single visit or treatment. The 98 dispensaries studied gave a total of approximately 860,000 treatments during their last fiscal year. Of these, 835,000 were given in Chicago dispensaries. With an average of four treatments per patient, which ratio quite generally obtains, about 215,000 persons received treatment in dispensaries in Illinois in one year. This is about 3.4 per cent of the population of the State. The percentage in Chicago would be eight. In our "block studies" of 3,003 families, it was found that 403 had received dispensary treatment for one or more members during the preceding twelve months. The total number of persons in these families was 12,257, the number of persons visiting dispensaries 601, or 4.9 per cent of the same. Most of the medical service in dispensaries is given by physicians without remuneration. The medical dispensaries of Chicago, exclusive of tuberculosis clinics, were found to have on their staff a total of 742 physicians of whom 37 received some financial compensation. The small fees paid by patients and other income received by dispensaries go to meet the general maintenance expense of such institutions. Operating costs, in many cases exclusive of rent, heat, light, etc. vary considerably. The expenditures of nine Chicago dispensaries giving a total of 22,803 treatments in one year averaged 44 cents per treatment. The quality of medical service furnished by a dispensary depends upon several factors. Of primary importance is the stafi". The Com- mission made no inquiries concerning the qualifications of physicians serving on dispensary staifs. Those dispensaries connected with high grade medical schools probably have an advantage in attracting medical men of ability. Equipment for modern j scientific diagnostic and thera- peutic procedure is essential to the best medical service. Such equip- ment, including x-ray and pathological laboratory facilities is frequently lacking in dispensaries, or if not lacking, is often inadequate. This greatly affects the work these institutions do. In some dispensaries there are too few doctors to insure that each patient receives the time and attention his case may demand. Other conditions of plant, equipment, records, organization, etc. all making their contribution to the quality of service a dispensary renders, are described in the more detailed treat- ment of the subject in Part II. As dispensaries have increased in number and as their work has increased in volume, there has been the not infrequent criticism on the part of individual physicians and medical societies, that dispensaries bestow medical charity upon people who have no valid claim to it and who can well afford to pay for medical service. As long as dispensaries are primarily charitable institutions in which doctors receive no financial compensation for their services, they should be careful, as should other charitable agencies, to see that only those who need such free service, receive it. Dispensaries differ greatly from each other as to the care they 93 exercise in limiting their service to bona fide members of the charity group. Some admit every applicant ; others make financial investigations of practically all their patients and exclude all whose incomes are above a fixed standard; still others fall between these two extremes, taking what seem to them to be reasonable precautions to keep out the financially ineligible. Careful investigations have been made at different times in Boston, New York, St. Louis, and other cities of a considerable number of dis- pensary patients, to ascertain their claim to free medical service. These investigations have shown that only a small percentage, from two to five, of dispensary patients are really able to pay for the medical service they seek to obtain free or upon payment of a nominal fee. In our study of 2,869^^ families in Chicago (charity cases excluded) it was found that 511 families, or 17.8 per cent, had received some form of dispensary service for one or more members within the preceding twelve months. Budget studies made in North Chicago, and investi- gations made by the Bureau of Labor Statistics and by the War Labor Board indicate that for a family of five (man, wife and three children under 15) an income of $1,700 per year is necessary to meet all normal family expenses including average sickness costs. Using this figure as a basis of classification of the 2,869 families, we find that 1,717 had incomes of $1,700 or over, or equivalent sums for smaller or larger families, as against 1,152 with smaller incomes. Of the 511 families receiving dispensary service, 102 were in the group with the larger incomes (with a minimum of $1,700 or its equivalent). Of these 102 families, 24 were given service in municipal tuberculosis clinics, infant welfare stations or in special clinics established for after-care of infantile paralysis, which institutions for obvious reasons do not limit their service to any economic group. This leaves 78 families in the higher income group receiving medical advice and treatment in dispensaries which in general confine their service to people of very limited income. These 78 families are 15.2 per cent of the 511 families with dispensary records. It is well to bear in mind, however, that the type of medical service needed is important in determining whether or not a patient is worthy •of dispensary treatment. One may be well able to pay a general practitioner for treatment of a minor ailment or one of short duration, but unable to pay for a specialist's service if needed or for treatment continuing through a long period of time. On the basis of type of service needed these 78 families divide into 55 whose condition of illness indi- cated the need of specialist service and 23 who presumably could have obtained all needed service from a general practitioner. From this analysis we may conclude that 23 families out of a total of 511', or 4.5 per cent, were recipients of medical charity which their economic status did not justify. This figure closely approximates the findings of the investigations in Boston, New York and St. Louis mentioned above. The pnblic health dispensaries, for example those conducted by infant welfare organizations and by public or private agencies for the treatment of tuberculosis, usually treat all who apply regardless of " Here are included only those families for whom complete income statements could be obtained. 94 financial ability. If pay clinics are established and with them a system of compensating dispensary physicians for their services, the question of dispensary abuse will tend to disappear. Efficient dispensary service is dependent in part upon competent J management. If those who control a dispensary's policies and direct its activities, realize the significance of the work the institution can perform and plan to make that work commensurate with public health needs, such an institution will be an important part of the community's medical facilities. If there is not management of this type, and too frequently there is not, a dispensary's value may be very limited. From the standpoint of the community the value of a dispensary depends upon the type and quality of' its medical service, upon the contribution it makes to the health and physical wellbeing of the people it serves. Its relation to medical school, church, social settlement or other organization is significant only in relation to this primary function. Unfavorable social conditions may cause, accompany, or result from sickness. Efficient medical service must frequently include diagnosis and treatment of attendant social conditions as well as of the disease from which the patient suffers. Recognition of this fact has led to the establishment of social service departments in many of the better dis- pensaries and hospitals. Such a department aims to supplement the work of the doctor by giving attention to various elements in a patient's environment which need correction, to problems in the solution of which he needs help, if the doctor's work is to be curative rather than palliative. Social service is making valuable contributions to dispensary efficiency by lengthening the period during which patients remain under treatment, by correcting home, employment and other conditions intimately related to a patient's, illness and by correlating the work of the dispensary with that of other agencies for community betterment. A more detailed study of dispensary social service will be found in Part II. As stated above, there seems to be developing a tendency to extend the work of the dispensary beyond the group who seek its service as a charity, to people of low or moderate income. To the public this means a more extensive utilization of the medical skill, equipment and organi- zation found in the dispensary. It means pay clinics ; adequate medical service within the means of a larger part of our population. From the standpoint of the physician it is* another step in the development of' group medicine or organized, institutional medical practice. (4) Nursing Care. Trained nursing service, while in more or less universal demand, is of very recent development. The first training school for nurses dates back only to 1860 when the Nightingale School of Nursing was established at St. Thomas' Hospital, London. In less than sixty years, skilled nursing care given by trained people, has not only come to be regarded as an essential part of the care and treatment of sick people, but it has also become more specialized and exacting as the prevention as well as the care of illness has become better understood. Though the degree of specialization is not shown by it, nursing may be divided into four general types, viz. the institutional, the dispensary, private 95 duty or resident nursing, and public health nursing (better known as visiting or district nursing). Institutional nursing is given in such institutions as hospitals, convalescent homes, and hospitals for the insane. It is done by student nurses in training, by attendants, nursery maids, graduate nurses on ward or private room duty, and special nurses, and is generally super- vised by a graduate nurse as chief executive of the training school main- tained by the larger hospitals. The special nurse devotes her full time to the care of one patient. The number of patients assigned to each of the other nurses varies according to her degree of training and to the ability of the institution to provide adequate care for its patients. In some institutions too many patients are assigned to one nurse. Dispensary nursing may be done in the out-patient department of a large hospital, in general or special dispensaries, in school clinics, and in the dispensaries or medical departments of industrial establishments. This usually consists of surgical dressings, certain technical treatments, and the supervision of and assistance in special clinics — i. e., tubercu- losis, psychopathic, for children, etc. Private duty or resident nursing is done by trained nurses, at- tendants, and handy- women. Ordinarily the nurse spends her entire time, from twelve to twenty-four hours daily, in one home, giving care to one or more patients. There is, however, some ^'hourly nursing" where the nurse spends one or more hours in the home at the entire expense of the patient. Public health nursing is provided by health departments, school departments, tuberculosis associations, visiting nurse associations, and infant welfare societies. The nurse goes into the home to give such nursing care, instruction and oversight as the condition of the patient may indicate or time permit, and to instruct the family in the care of the patient between visits. "Public health nursing'^ is largely a new name for old work. It covers all forms of home visiting both for the care of the sick and by instruction and demonstration for the prevention of illness. Visiting nursing, school, tuberculosis, infant welfare, mental hygiene, and some other forms, are all covered by the term "public health nursing.'^ The time spent in each home by a public health nurse depends both upon the needs of her patients and the number of patients under her charge. A seriously ill patient or a large surgical dressing may require a daily or twice-daily visit. The instruction and supervision of a family in which there is pulmonary tuberculosis may indicate frequent visiting but the number of cases under supervision may not allow more than one visit a fortnight. The home instruction of a young mother in the modification of an infantas feedings will require daily visits at first, later possibly not more than two or three visits a month. Public health nursing, from small beginnings in this country forty years ago, has become a recognized community need. District nursing was originally only the care of the sick patient in his home. Later it was recognized that prevention of illness by trying to keep the other members of the family well, was quite as important a part of the nurse's 96 work. Experiments in the home care of tuberculous patients and in the home supervision of school children, demonstrated the wisdom of having nurses assigned to these two special branches. Public health nursing originated as a charitable effort. The initial step in all of this work has been undertaken by private funds and as its value has been demonstrated various features have been assumed by public funds. *In Illinois, school and tuberculosis nursing, when found, are usually supported from the public treasury. In Los Angeles, all visiting nursing to the destitute poor (tuberculosis, child welfare, maternity, etc.) is provided by the Health Department. In Akron, Ohio, there is a Bureau of Public Health Nursing in the Department of Health. In Dayton, Ohio, all home service is given by a staff of nurses supported and supervised by funds from the Visiting Xurse Association, the Health Department, and the Tuberculosis League. The state health departments of N'ew York, Minnesota, Kansas and Ohio have state supervising nurses who keep closely in touch mth the public health nursing work in counties and small towTis. In many large cities this service is given to the poor or small wage- earner but in some cities a privately supported Visiting Xurse Association combines hourly nursing with free nursing. Providence, R. I. ; Cleve- land, Ohio; Richmond, Va. ; Hartford and Xew Haven, Conn.; and other cities have demonstrated that these two types of service can be given by one organization. A census of nurses taken in Illinois in February, 1918, showed that 8,150 were engaged in the practice of nursing for hire or in nurse-train- mg schools. Of these 2,628 were graduate nurses, 3,639 were student nurses, and 1,899 were attendants and orderlies. This enrollment is incomplete for it was made from questionnaires sent out. There are doubtless several hundred more attendants or practical nurses in the State. Until some method is devised for the registering or licensing of all people who practice nursing, any census must necessarily be mcomplete. A gi'aduate nurse is one who has a course in theoretical and practical nursing in a school attached to a general hospital. The 1913 state law for the registration of nurses recognizes only those schools which give a three year course and meet certain standards for both class-room and hospital work. There are 120 training schools in the State, but not all i)f these are on the accredited list. A practical nurse may gain her knowledge of nursing in any of several ways. She may have some hospital training, she may have taken one of the many courses in nursing offered by correspondence schools, or she may have had practical experience in the sick room at home. As a rule, such nurses have little or no systematic theoretical instruction. Of the 2,622 graduate nurses listed in Illinois, about 500 are doing public health nursing — about 400 in the City of Chicago and 100 or more elsewhere in the State. The number of nurses thus employed varies so constantly that an accurate figure is next to impossible to 97 obtain/^ Some 1,432 graduate nurses are employed in various institu- tions throughout the State. Accordingly, when the census referred to above was made, there were not more than 700 graduate nurses left for private duty. Nearly 1,000 graduate nurses from Illinois had gone into active war service, but even before their departure the number of graduate nurses for private duty was wholly inadequate to meet the demand. The number is always smaller than of those professionally trained, for many graduates marry and give up nursing; a large number take up other work. It is significant that private duty nursing is followed by such a comparatively small number of graduates when, in the minds of the public, hospitals train nurses for this one field. Trained nurses engaged in the different branches of nursing out- side of hospitals are very unevenly distributed in different parts of the State. Private duty nurses are available or may be secured, though in in- adequate numbers, in all of the larger cities. In many of the smaller places, and especially in many of the mining centers, however, they are not available. Use is made of practical nurses or "handy-women" or no nursing service is had.^* The same deficiency in visiting and school nursing is found out- side of Chicago. Moline, Peoria, Springfield and a few other places have a small number engaged in general, school, tuberculosis and infant wel- fare nursing, but most of the larger places have an inadequate number, if any, while rarely do the smaller places have any at all. In fact, only about fifty places outside of Chicago have public health nursing by trained people, and as already stated, the total so engaged is only slightly in excess of 100.^^ School nursing, infant welfare work, and tuberculosis nursing have been discussed in an earlier part of this report.^^ At this point it is only necessary to state the terms on which nursing may be had in hospitals and private homes and to say something with reference to the non-special- ized visiting nursing. The hospitals, of course, provide general nursing service for their patients. The charge for a special nurse is, however, borne by the patient. The cost varies somewhat, but the usual fee for a graduate "In the summer of 1917. according to Illinois Health News, September, 1917, pp. 228-231. there were 406 Public Health Nurses in Chicago, and 102 outside of Chicago. Those outside of Chicago were located in 50 cities, with from one (In 28 cases) to nine (in one case) each. Of those outside of Chicago, 53 were gen- eral nurses. 31 school nurses, 11 tuberculosis nurses, 5 industrial nurses, and 1 an infant welfare nurse. Those in Chicago were distributed as follows : Visiting Nurse Association 90 Municipal Tuberculosis Nurses 75 Infant Welfare Nurses 33 Public School Nurses 149 Hospital Social Service 17 Industrial Nurses 42 Total • 406 "See Hayhurst, Health Conditions of Coal Miners, Part II of this report, Special Report V. .«,.,,, "See preceding chapter and Part II of this report. Special Report XIII. 18 See Chapter II above. — 7 H I 98 nurse is $30 per week in general cases, and $35 in obstetrical and in- fections disease cases. Nurses in training may also be assigned to "special duty," in which case the fee is somewhat smaller. The hospital charges in addition from $6 to $10 per week for the special nurse's board. The fee of the resident nurse in the home is from $30 to $35 per week for the graduate nurse, from $15 per week upward for the practical nurse. The fees for graduate nurses are usually established by the registry or nursing organization to which they belong. There is no fixed fee for home nursing service by attendants. The fees of hourly nurses are, as a rule, $2 for the first hour and $1 for each succeeding hour. The service of the visiting nurse is given free to all persons unable to pay, at cost to patients able to pay this sum (from 50 cents to 65 cents), at some other figure, say 25 cents, where the patient is able to pay something but not the full cost of the service. The Metropolitan Life Insurance Company provides free visiting nursing service for mosfc (about 90 per cent) of its industrial policyholders, and certain large individual concerns provide it for their employees. Considering the long hours, the broken rest, the period of training required to become a graduate nurse, and the responsibility which good nursing entails, the maintenance of a home or lodgings, and the time "off" required for rest between cases, the fees for private duty nursing are not excessive.^^ The earnings of nurses are not continuous for the year at the weekly rate. As will be shown later, in certain seasons of the year there is very little call for private duty nursing.^^ Yet it must be said that the cost is prohibitive for most families. ^^ Hence the develop- ment of visiting nursing which has taken place. General visiting nursing in Illinois has been developed only to a limited extent outside of Chicago. Because of this fact use may be made of the Visiting T^urse Association in Chicago to indicate more concretely the nature of the service and its possibilities. In 1917, the Visiting Xurse Association of Chicago made 241,352 home visits to 34,427 patients, at a cost of 55 cents per visit, giving an average of 7 visits to each patient. Some patients received more than 100 visits, others were dismissed on the first visit. This work was done at an expense to the Association of $134,346. Seventy-one per cent was free w^ork, not paid for by patient, employer or insurance company. About 50 per cent were known to other public or philanthropic a.ijencies, although many were not registered with societies giving material relief. Some were known only to dispensaries,' hospitals, courts, social settle- " In return for instruction and maintenance, the student nurse usuaUy gives her time and strength for three years to the hospital in which she is receiving her training. The cost of the training is covered by the work done in the insti- tution, and is considered comparable to a technical training, where the student bears not only all of her personal expenses, but in addition, pays tuition or fees for an academic course embracing class-room and laboratory work. The student in a hospital is, however, on active duty from 56 to 70 hours per week for 50 weeks in the year. The time spent in the class-room averages, as a rule, not more than from 100 to 150 hours per year. ^^ See p. 101. " In addition to the fee to be paid, there is the problem of providing for an additional member of the family. 99 ments, etc. Less than 25 per cent of the whole group were receiving free medical service from the County physicians. Twenty-one per cent of the group needed assistance from no outside agency other than the Visiting Xurse Association. Approximate 1}' 15 per cent of these calls came from families known to the Association in previous years. This very large amount of free work — 71 per cent — shows the need of this nursing service in homes where illness suddenly breaks into the regular routine. An extension of this service to all families, not merely to the homes of the small wage-earners, is desirable. A study made June 20, 1917, of 653 Chicago families entered by the visiting nurses showed that less than 25 per cent of these families had a weekly income of $20 or more. Free service was given in 316 homes or just about one half. In the remaining homes, something, from a small fraction of the cost to the full cost, was paid for the service. A similar study made by the Instructive District ISI^ursing Association of Boston showed that only 13 per cent of the 1,038 families investigated had a weekly income of $20 or more. The question is frequently asked if many of these calls are not sent in unnecessarily, especially when public health nursing is supported by public funds. A careful analysis of the cases dismissed on first visit in 1916 showed that although 14 per cent of the patients of the Visiting Xurse Association were thus dismissed, approximately 10 per cent were dismissed to hospitals and to other agencies; a few had sent in wrong addresses. Xot more than 4 per cent came from homes where there was no illness, and even in these homes, it was possible to explain the service and not infrequently to give some much needed advice regarding the care of a convalescent or a little child. The experience of the insurance companies is much the same. About 6 per cent of the calls received from the Metropolitan Life In- surance nursing service in Chicago in 1917, was dismissed on the first visit. In only 1 per cent of these calls was there no illness. The re- maining 5 per cent were transferred to the general visiting nurse service because the patients were not insured or had no physician in attendance and hence Avere not entitled to tlie Metropolitan service. All good public health nursing is done in close cooperation with local physicians, but it is sometimes necessary to keep a patient under supervision for days before the family will consent to the expense of calling a physician. These patients are not given treatment, they are simply watched and advised. Medical service is frequently obtained for patients distinctly in need of it, because the need has first been dis- covered by a public health nurse, and the family watched until it recognizes the value of immediate medical service. Most visiting nurse patients are like other human beings, and send for a doctor promptly if acute symptoms precede a slight or serious attack of illness, but incipent and less tangible symptoms of serious physical disability are frequently overlooked until the doctor is called too late. 100 ^^ In view of the extensive interest at present displayed in the in- adequate nursing service in the State, something should be said with reference to what adequate trained service would require. The only carefully worked out estimate seems to be one derived from a survey of five districts in Dutchess County, New York, made in 1912. In a total population of 11,800 living under fairly typical urban and rural con- ditions, 1,600 cases of serious illness were studied. Nine thousand working days were lost by men and women; 13,700 school days were lost by children. Chronic invalidism caused 31 per cent of the cases studied. The general results may be quoted from the report and the conclusions arrived at stated. ^° "In this report the term 'sickness' is limited for our purpose to that which was so ssrious that it either necessitated or should have necessitated the patient's going to bed or securing medical aid. A slight ailment, such as indigestion, head-ache, or a light cold, was not taken into account." "By 'adequate service' is meant that service which insures the patient's rscovery when recovery can be expected, and which is of such a character that neither the patient nor the community incurs avoidable risks." "Seventy-two per cent of all the cases studied could have been cared for adequately in their own homss, had there been available nursing service." "Twenty-four per cent of the patients secured no medical cars." "Much of the sickness recorded was due to lack of early and accurate diagnosis." "There is no attempt in the county, by organization, to make sura that those who most needed the services of trained nurses, secured them, or to insure a sufficient supply of trained household attendants and domestic servants, though this type of service made up 60 per cent of the help needed in homes where there was sickness." "Of the 113 women who went through child-birch in their homes, only one had the continuous care of a graduate nurse, and only 18 had any service whatsoever from graduate visiting nurses. Thirty-five per cent of the chil- dren born came into the world under unfit conditions and surroundings." "Of the total, 1,441 patients, 90 per cent remained in their homes during their entire illness. Of these, 2 per cent secured resident trained nursing service; 4 per cent secured visiting trained nursing service; 5 per cent were cared for by a resident untrained nurse; less than 1 per cent by a visiting untrained nurse. In 2 per cent of the homes, resident domestic help was secured, and in one home, visiting domestic help was secured. In 59 per cent some member of the family did whatever nursing was done." "Of the trained nursing service secured, 42 per cent was resident and 58 per cent visiting. Of the untrained service, not including nursing by members of the family, 72 per cent was resident and 28 per cen: visiting. Of the total service received, 22 per cent of the resident service was trained, v8 per cent untrained; of the visiting service, 56 per cent was trained and 44 per cent untrained." As a result of this survey, the Committee reached the following conclusions: The number of days of resident graduate nursing service would keep an average of 14 nurses employed, varying from 9 to 27 per month, an average of one resident graduate nurse to every 840 of the population. Eighty-eight per cent of the families requiring this service were able to meet the full expense. Allowing one visiting nurse to every 2,500 popu lation and one school nurse to every 1,600 population, 35 20 Sickness in Dutchess County, New York, a report made by the Committep on Hospitals of the State Charities Aid Association and published in New York 101 public health nurses would be needed to care for the entire community. Estimating one resident trained attendant for every 1,200 people would necessitate the constant employment of 75 attendants. Kesident do- mestic help was needed in many homes on account of the illness of the housekeeper, and 108 women would be required to nieet the need of a service of this sort. The estimate of one visiting nurse to every 2,500 population was made for rural and urban communities; one nurse, in urban conditions, could undoubtedly meet the needs of every 5,000 population. Students of the work of school nurses recommend one nurse for every 3,000 or 4,000 school children in congested quarters. Using the estimate made in this report, Illinois would require not less than 5,000 private duty nurses, 2,000 public health nurses, 4,000 domestic helpers for the care of the sick in their own homes. It is necessary to consider the use of domestic helpers, servants, or "handy- women'^ as they are variously called, in an estimate of this sort for in many homes the illness of the mother or the caretaker makes household service of this type absolutely essential. The Dutchess County experience showed that while the number of public health nurses required would be fairly constant, as the instructivG work was considered equally important with the bedside care, the number of nurses for resident private duty varied from 9 to 27, giving an average of 14. In other words, in certain seasons of the year three times as many resident nurses would be required. In Chicago, the average private duty nurse is busy seven months of the year. The late spring, summer and fall months usually require one-third as many resident special nurses as are in demand during the winter and spring. A nursing registry enrolling 600 graduate and attendant nurses reports that while it can rarely, if ever, meet the demands made upon it in February, in June it has had as many as 160 idle nurses on its waiting list. It further reports that an equal number had gone home or taken up other work. This condition does not, of course, apply to epidemic years. It would be impossible to meet the tremendous demands made upon that nursing service during an epidemic like influenza in 1918 or scarlet fever in 1913. Epidemiologists have charted the expectancy of recur- rent epidemics of pneumonia, scarlet fever and diphtheria with a start- ling accuracy. To meet the nursing need of any given population in periods of slight or of acute illness, two plans suggest themselves: First, that resident graduate nurses be used in all households during the period of critical illness, the expense to be borne in part by the family and in part by public funds, if proper investigation has shown that the expense is beyond the family's means. Public health nurses may be sent in daily after the resident nurse has been dismissed, to give such care as the patient requires, this care to be supplemented by members of the family. Second, that courses in home nursing be made compulsory for all girls in eighth grades and in the first year of the high school, so that in time all women will have at least a working knowledge of personal hygiene, 102 home sanitation and household nursing. A six or a twelve months* course in nursing rather than the present three years' course may also be a solution of the inadequate supply of nursing service in the homes, but it remains to be seen if women in sufficiently large numbers will take these courses. If resident skilled nursing may be dispensed with, but a better kind of supplementary nursing than the average household can give is neces- sary, this may be furnished by attendants. The price paid for this service must make a living and desirable wage for the individual earning it. An appeal to the women of a community to take special training in order that they may give this service to their communities at the price the community is able to pay, will attract few candidates because in less ardous work the same amount or more money is more easily earned. ■ This fact must not be overlooked in deciding upon any plan of commun- ity nursing. Public hospitals, dispensaries and free medical service are pro- vided for people unable to employ physicians. It is a well recognized fact that the best physician is not too good for the working-man because the poor man can least of all afford to be ill. Consequently in planning nursing care for the sick poor or the sick of the middle class, we must look upon it firsts from the standpoint of the needs of the patient for skilled or unskilled nursing care; second, from the ability of women in that community to work for the wages offered ; third and least important, from the standpoint of cost. Better organization of the nursing resources of any community will in , time help solve this problem. Three plans have been suggested. First, the Brattleboro plan has been tried and has proved successful for a small community. Second, the Cincinnati Unit plan has been in effect about one year but its results are already very promising. Third, the Dutchess County plan has been recommended. It is really a com- bination of both the Brattleboro and the Cincinnati plan but has not as yet been tried out' on a sufficiently large scale to make workable deductions possible. In Brattleboro an association providing community home nursing, attempts to suppl}^, first, the services of a graduate nurse during the most critical state of the illness; second, an attendant nurse for convalescent and chronic patients; third, domestic help by the day or hour in homes where this is needed. This sort of organization is more successful in small communities than in large because there are fewer opportunities for M^omen to dispose of their services in other ways, therefore positions as domestic helpers and as attendant nurses are more easily filled. In Cincinnati, the National Social Unit Organization plans to organize all of the social agencies in one neighborhood — physicians, nurses, relief workers, churches, settlements, schools, and the citizens themselves — for more efficient neighborhood service to one another. This is more than a redistribution of the nursing facilities; it plans the socialization of the medical, recreational, educational and other neighbor- i03 hood interests and is attempting to introduce small town neighborliness into large and heterogeneous communities. The Dutchess County report recommends the following plan of organization : OBJECT. "The health assocation would have as its object the coordination and development of existing facilities of the community for the care of the sick and the prevention of disease, in order to make them thoroughly efficient and readily available to all, and the development of such additional facilities as study and experience may indicate are needed. "The association, however, cannoi; attain these objects unless it has the sympathetic interest and cooperation of the physicians in the county. Their interest and cooperation must underlie all its work and are vitally essential to its success. MAIN LINES OF WORK. "In order to do itS work most efficiently, the association should cooperate with all the public and private medical and social service agencies at work in the county, along the following lines: A. REMEDIAL. WORK. 1. Establishing an efficient system of medical, nursing and social service for the care of the sick in their own homes. 2. Securing the cooperation of the existing hospitals, stimulating the provision of additional facilities where and when clearly needed. 3. Maintaining a proper distribution of patients as between home and hospital care, based on a study both of the patient's disease and of his social and economic circumstances. B. PREVENTIVE WORK. 1. Educating the individual: (a) as to personal hygiene and the obser- vation of its law; (b) as to the nature of communicable diseases and the means of avoiding them as well as the necessity of collective action to safe- guard health and avert danger from these sources; and (c) as to the bad housing and unfit social and industrial conditions in which he lives and the means that can be employed to improve those conditions. 2. Securing the adoption and strict enforcement of public health meas- ures, i. e., public hygiene." For several years the Central Branch of the Young Women's Christian Association of New York City has conducted an eleven weeks' course for trained attendants and writes as follows: "The trained attendant must be fairly well educated for she must take the place of a trained nurse and is often relied upon for companionship and advice. Therefore we require an entrance examination of all who are not high school graduates. In normal times we graduate about 150 each year. During the war period we graduated about 300 annually. These graduates earn from $12 to $18 per week, including room and board, and are constantly busy." Assuming that there are many women able and willing to take a shorter course in nursing than the present three years' training, there 104 have been no places in Illinois where this training was offered. It is now proposed that many of the hospitals which are conducting second and third rate training schools for nurses, discontinue their attempt to train three year nurses and institute shorter courses. In this wav a second and much larger gi'oup of women with nursing experience can be developed in a fairly short time. 105 CHAPTER IV. EXISTING HEALTH INSURANCE. (1) Introduction. No fewer than ten European countries (Germany, Austria, Hun- gary, Luxembourg, Norway, Serbia, Great Britain,Eussia, Roumania, and the Xetherlands) have made health insurance compulsory for many or most wage-earners.^ So have some of the Swiss cantons, and in 1917 a Commission was created in Italv to draft a bill for enactment into law. Three countries (France, Italy and Denmark) have for some time had compulsory insurance of workmen in a few occupations. The govern- ments of Switzerland, Belgium, France, Sweden and Denmark have a system of health insurance subsidies. Whatever may have been the motives leading to the adoption of compulsory health insurance in some of these countries, the systems adopted have extended insurance to many wage-earners theretofore with- out it, have standardized the compensation and medical benefits provided and made obligatory as minima a level of benefits previously not generally granted by the various insurance institutions which had grown up. With unimportant exceptions under this legislation use Avas made of existing institutions on condition that they met certain conditions pre- scribed by law; then new organizations were created or old ones (e. g. the Post Office in Great Britain) were used to provide carriers for work- men who failed to secure membership in institutions of the type already providing sickness benefits. It is unnecessary to present the history of this European legislation, to outline accurately its detail, or to give an account of the operations under it. Concise accounts of the two leading systems, those of Germany and Great Britain, will be found in Part II of this report. A table showing the dates when seven of tlie systems were adopted, the main classes now insured, the main benefits prescribed, and the division of the cost must suffice. It should be noted, however, that under this legis- lation the minimum benefits may generally be extended and made more liberal, and that certain classes not under the necessity of becoming insured, may become voluntary members in the "funds.^' ^ It has been stated that Sweden adopted compulsory health Insurance in 1918, but careful search leads to the conclusion that the statement is incorrect. 106 1 to c C3 Im © 05 All employees except All employees earning casuals in establish- less than certain ments specified— sums ($;^()0 to $600). factories, mines, in- Certain casuals, tax- land navigation, payers and domestic those with fewer servants not in- than 20 to 30 em- eluded, ployees excepted. 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O >>^ > ?!) a» © ti c3 © a «=i ^x> .5 >> §•- 3 © X3 C8 .2b5 "O *^ ©« 3 X> a o o OXJ ^^ — iJJ U ;ti OoJK| 108 The outstanding facts in this compulsory insurance legislation are these: (1) the application of the principle of compulsion to extend insurance to many persons theretofore not insured; (2) the prescription of minimum benefits — these being partial compensation of wages lost because of disabling sickness, medical and perhaps hospital treatment, maternity care or payments, and, usually, burial allowances; (3) the option given the mutual carriers of increasing the benefits over the minima prescribed; (4) a prescribed method of meeting the cost so as to distribute it between employers and workmen, or among these and the state; and (5) a system of control by those who contribute to the funds, with state supervision through governmental machinery set up. These are the outstanding facts as shown by an analysis of legis- lation. With the legislation in effect other significant facts are revealed, for compulsory health insurance alters the practice of medicine more or less extensively, and may profoundly change the relation of the hospital and other medical institutions to the community. It may also have important effects on labor organizations and other institutions. Such matters as these, however, do not require discussion at this point, for a more fitting place for the needed discussion is found in the next chapter of this report. Our investigations show that a great manv institutions providing health insurance for wage-earners are to be found in Illinois. Among them are establishment funds maintained by employers, or by their em- ployees, or by employers and their employees jointl}^; trade unions; fraternal societies; "independent foreign'^ societies; "burial societies;" and insurance companies of various kinds. Considered collectively the benefits provided by them include almost all of the benefits provided under an inclusive health insurance system. Yet health insurance as now found in Illinois presents a striking contrast to the systems developed in the leading European countries. Except for the disability allowances permitted under the pension funds for public employees," none of it is in government insurance funds or subsidized out of public monies, and only the smaller part of it is regulated or supervised by the public authorities. While the principle of compulsion is applied here and there by employers or by labor organizations, it is nowhere applied by the State. In other words, the existing insurance is voluntary, with or without pressure exerted by private parties. If cash benefits in com- pensation for lost wages are considered, our investigations show (1) that while there are great variations between races, localities and industries, perhaps only about thirty per cent of the wage-earners of Illinois as a whole have such insurance; (2) that this insurance is not standardized so that frequently the compensation is in relatively small sums, most of it is limited to comparatively short periods, and frequently certain classes of wage-earners or certain types of disease are excluded;' (3) that most frequently the entire cost of compensation provided is met by the payments of the insured; (4) that in some cases because of necessarily high acquisition costs in \j^riting voluntary insurance, the premiums greatly exceed the total returned to the insured; and (5) that frequently ^ For an account of this, see Report of Illinois Commission on Pension Laws. 109 the interests of the insured are not safeguarded by the system of admin- istration developed. A much smaller percentage of wage-earners are entitled to medical and hospital treatment and nursing care than to cash benefits under the insurance they have. Maternity benefits and provision for maternity care are rarely found. The majority of wage-earners and a large majority of their dependents are, however, provided with "funeral benefits" or "burial insurance" or life insurance in small or moderate amounts. As in other commonwealths, so in Illinois this is the one phase of "health insurance" that has been highly developed. However, some of this insurance in foreign societies and fraternal orders is not entirely safe because of inadequate premiums or reserve funds, while that carried on individual policies with industrial insurance companies is relatively expensive because of the high acquisition costs connected with the necessity of maintaining a large number of agents. In these respects existing health insurance in Illinois stands in con- trast to compulsory health insurance as developed in some of the European countries. Of course the statements here made are not in- tended to argue for compulsory health insurance, or, for that matter, for any change from the existing situation. They are intended merely to set forth facts. Conclusions with reference to what ought to be and the Commission's recommendations are presented in the next chapter of this report. In Part II of this report the results of the staff's investigations of health insurance provided by ^establishment funds, . labor organizations, national and "local fraternal organizations, .independent foreign societies, ana insurance companies of different kinds are set out in some detail. Those who wish to secure a comprehensive statement of the existing insurance situation must consult these several reports.^ At this point it is possible only to bring together and set out the more significant facts. (2) Establishment Funds. The Commission's investigations have shown that establishment funds maintained by employers alone, by their employees alone, or by the two jointly, are one of the most important institutions providing benefits in cases of sickness and death. A list has been made of 134 such funds or benefit systems in operation in Illinois and 115 of these have been studied in some detail. Some of these are for workmen in a given plant ; others extend to the workmen employed in two or more plants operated by a given firm. The be^t estimate it has been possible to make is that not less than 150,000 and not more than 200,000 wage-earners are employed in Illinois establishments in which the 134 known benefit systems are in operation. Thus more or less extensive provision has been made for meeting the problem here dealt with in the plants in which 8 Perhaps it should be stated that our investigations related especially to in- surance against disability from sickness and non-industrial accidents and to funeral benefits. Only because life insurance as distinguished from funeral benefits serves to cover the expenses of the last illness and burial costs as well as to provide for the needs of dependents has it come within the scope of the Commission's investigations. For this reason life insurance has been dealt with only incidentally and no attempt has been made to Investigate or to discuss the organized life in- surance business as such. 110 from 7^2 to 10 per cent of the wage-earners of the State are employed. Perhaps 65 per cent of these are members of the funds maintained. The extent to which establishment funds have been organized varies greatly from one locality or industry to another. In respect to locality they are found most conspicuously in Chicago, Moline, and East St. Louis. In respect to industry most of the funds are found in the iron and steel plants, large establishments engaged in the manufacture of agricultural implements, the meat-packing plants, and the large stores of Chicago, or are operated by the railroad, telephone and other utility companies. They find practically no place in coal mining and the build- ing trades where the men are well organized into unions, and in the many industries and businesses conducted on a small scale. The establishment fund is largely the product of experience with the emergencies presented by disabling sickness and death. In the absence of such systematic provision for paying benefits, employers have frequently paid wages to the more valued of their employees and have contributed to the relief of others. The employees themselves have fre- quently "passed the hat." The establishment fund has been developed to meet the situation in a more svstematic, more certain, and more satis- factory way. This method has made considerable headway during the last ten years. Yet it is by no means new. AMiile the majority of the 115 funds studied in detail were found to have been organized during the last eight or ten years, no fewer than 20 were found to have been in operation for twenty years or more, and the oldest had been in continuous operation since 1874. jSTot all of those organized have brought a net gain, however, for a considerable number have been given up after a longer or shorter experience. In a few of these cases this has been due to the opposition of employees who have been organized into unions providing benefits and who then objected to making contributions for the support of two benefit systems. In other cases the employer, confronted by union demands, has changed his labor policy and given up his wel- fare plans. Some funds were discontinued when workmen's compen- sation was adopted and the old provision for cases of industrial accident was no longer needed. Finally, some benefit systems have been dis- continued because the expected gains had not been fully realized or be- cause of administrative difficulties which had arisen. Of the 115 establishment funds studied, 22 are organized and (with occasional subsidies) conducted by the employees, 82 are organized, conducted and supported by the employers and their employees jointly, while II are conducted and supported entirely by the employers. Thus three general types are found. It should be pointed out in this con- nection, however, that in 59 of the 82 funds of the second type, the employers contribute only by bearing the incidental cost of administra- tion (chiefly collecting the dues) and now and then making grants in aid when deficits are incurred. The evidence is rather slight, but indi- cates a tendency towards the adoption of funds organized, conducted and supported by the employers. This appears to be due to the desire to get rid of administrative difficulties and misunderstandings where the Ill employees contribute, to make the system inclusive and to shape it so as to meet. problems in management. Of course not all of the 150,000 to 200,000 Illinois wage-earners in plants in which benefit systems are in operation are members of the funds. It has been possible to secure accurate figures for both the mem- bership and the total number of wage-earners in Illinois plants in only 88 cases. Combining the figures for the 88, the number of members was found to be about 65 per cent of the total employed. Taken separately the percentages varied from* 24 as the minimum to 100 as the maximum. In connection with membership in these benefit systems it should be said that two opposing tendencies have been present. The one re- sults from the desire to make the membership inclusive so as to ac- complish the greatest good and to spread the overhead cost of the system as widely as possible. The other results chiefly from the desire to limit membership so as to avoid bad risks who would draw more in benefits than they would contribute in dues to the fund, to avoid extending aid in unworthy cases and to avoid association with those racially different. Out of these and other cooperating factors have developed a, maze of varying rules and practices. Xaturally membership in the systems organized, conducted and supported by the employers is more or less inclusive. In 18 funds supported partly, and in most cases largely, by the members, membership is compulsory for those admissible under the rules. In some other cases the pressure upon employees exerted through "100 per cent drives" or otherwise, is such as to approach compulsory membership. Where compulsion or pressure is absent, which is most frequently the case, the membership in the benefit system is likely to be less general. How general it is among the employees depends upon numerous factors such as the interest displayed in securing new members, the terms on which they secure benefits, the nature of the benefits provided, and other opportunities available for insurance. On the other hand, medical examination and rejection of "chronics" and other undesirable risks are found in 44 of the 115 funds studied. In a few other cases no benefits are paid in cases of disability due to certain chronic diseases. Persons suffering from venereal disease are usually excluded from membership or disability due to venereal disease, and, perhaps, disability due to intemperance and immoral conduct are uncompensated. In 26 cases rules are found debarring the older appli- cants from securing admission to the fund. Eleven funds exclude women; four have race limitations. In a large number of cases the applicant must have been employed in the establishment for a certain length of time and in a few of these the period required is such as to be very restrictive of membership. Salaried employees or those in certain departments may be excluded. More important, in order to avoid diffi- culties due to paying the usual sum as the cash benefit, whicli would equal or exceed the earnings of some, those with the lowest wages are ex- cluded in a few cases. Taken collectively these benefit systems partially compensate for wages lost by reason of disabling sickness or accident, provide funeral 11^ benefits and life insurance, and make organized provision for medical and surgical treatment, hospital care, nursing, medical and surgical supplies, and dental and maternity care. Thus every important feature of a full-fledged health insurance program is found. But taken separ- ately in no case are all of the benefits thus enumerated provided. In most cases only cash benefits are paid, frequently in small sums for a comparatively short time in cases of disabling sickness; in only a few cases are extensive medical, nursing and dental benefits found. S The primary object of the establishment* funds has been to pay cash benefits in cases of disability and death. Hence all but three (these are hospital funds) of the 115 studied pay cash benefits in the event of more or less seriously disabling sickness, and 70 of the 115 pay a stipu- lated sum or sums in the event of death. Only 17 provide anything more than these cash benefits. The "sick benefits" paid in a few cases are a certain percentage of wages. In one fund applying uniformly in a large number of plants, it is two-thirds of the disabled member's normal earnings. In many other cases benefits are graded roughly according to wages. Sometimes they vary with length of service. Most frequently, however, they are N^a uniform sum, say $1 per day or so much per week. Sixty- three funds provide fixed benefits ranging from about $4 to $14 per week. The majority of these pay from $7 to $10. Fifty-one of the funds pay graded benefits ranging from $1.50 to approximately $20 per week."^ In a majority of these cases the minimum is close to $3.50 per week and the maximum about $11.50. Taking 44 benefit systems where complete information was secured, $1,653,619 was paid in 1917 in compensation for 1,265,846 days of disability — an average of $1.31 per day. With the higher level of wages obtaining in 1917 this w^as less than 50 per cent of the average daily earnings. In any health insurance plan the waiting period before benefits become payable, the maximum number of weeks for which they may be paid, and the kinds of disability excluded from compensation are very important. Among the establishment funds of Illinois no close approach to uniformity in these matters is to be found. Waiting periods of a half day, 3 days, 6 days, 7 days, and 14 days are found, 7 days, however, being more frequently found than any other. In some cases when dis- ability lasts longer than the days constituting the waiting period and claims may therefore be presented, payment is allowed from the first day of illness; in other cases it is allowed only from the close of the waiting period ; while in still other cases a compromise arrangement is made and benefits are paid for the days constituting the waiting period but at a reduced rate. Of greatest importance is the number of weeks for which benefits ^ are paid for any one disability and for all disabilities a member may have in any one year. The maximum numbers in Illinois establishments for any one disability vary from 2 to 104 ; for all disabilities in any one year, from 2 to 52 weeks. In both cases the maximum most frequently found is 13 weeks. Thirteen weeks is a rather short period in certain ■•One of the 115 funds did not report information on tliis i)oint. 113 types of cases, and just those most likely to result in acute distress. If payments begin with the eighth day of disability the number of days of disability compensated with a 13 weeks' maximuni will be about 85 per cent of what it would be with 26 weeks' and about 74.5 per cent of what it would be with 52 weeks' maxim^um.^ The difference is no small one and it is of course all found in the payments made in the more serious cases lasting longer than 98 days. A number of the funds, however, have arrangements under which it is possible to extend the benefits for a longer time in individual cases. Moreover, it is the policy of some firms to supplement the work of the funds and to give further aid than the rules call for. Fifteen of the llo benefit systems studied make provision for the payment of maternity benefits. This is a very considerable percentage of the funds which have women members. Most establishment funds make provision for the payment of death benefits. This is true of 70 of the 115 studied. These benefits are, with few exceptions, a small funeral benefit of $50 or $100 but in two cases the sums allowed are $200 and $300 respectively. As another exception, nine funds were found which pay something more than funeral benefits — as much as $1,000 or even $2,000. In a very few (three) cases provision is made for the payment of a funeral benefit in the event of the death of the wife or other dependent of a member. In connection with death benefits provided by the establishment funds, something should be said concerning the death benefits and in- surance provided by the firms as such. Death benefits and life insurance as well as old age pensions find an important place among the employer's welfare plans which are becoming of more frequent occurrence and his plans for stabilizing his labor supply. Thirteen of the firms in connection Avith whose plants funds are in operation, were found to have taken out group life insurance policies for their employees. In some cases this was in addition to burial benefits otherwise provided; in others it was the only death benefit payable. Moreover, 7 company funds were found out of which death benefits ranging from $100 to $2,000 are paid. These are usually limited to employees who have been in the service of the given firm for a certain length of time, and, moreover, are generally graded according to the period of service. As stated above, medical, nursing and dental benefits are not so frequently provided as these cash benefits which have been thus far dis- cussed. Of the 115 funds studied, 17 provide for medical treatment of their members, and in about three-fourths of these cases this treatment is extended to them in the home as well as in the establishment in which they are employed. In 13 cases surgical care is provided but in some of these cases this amounts to little more than "first aid." In only 10 cases is there any claim to furnishing hospital care. Most important of these 10 are the three hospital associations mentioned above. One large fund provides sanitarium care for the tuberculous, and when the s See Part II of this report, Special Report II, Table VI for basis for compu- tation made. —8 H I 114 52 weeks benefit period expires this may he extended, the expense being divided between the fund and the firm. In a few instances provision is made by the fund for nursing and for medical supplies. However, these services are more commonly furnished by the firm. More extensive than the provision for medical benefits made by these funds is that made by the firms in whose establishments they are found. Several of these maintain medical departments; in some cases medical treatment is extended to employees in their homes, but chiefly in emergency cases; several provide nursing service, and in some cases in the home by visiting nurses as well as at the plant; in two cases ex- tensive dental departments are maintained. A further question of interest relates to the support of these benefit systems. The 22 employees^ funds, all small, are supported by the con- tributions of their members. Over .against these, the 11 employers' funds are supported entirely by the firms. In the case of 82 joint funds, the cost is shared, but usually not equally. In 59 of these the only con- tribution made regularly by the employer is the expense incurred through the "check-off'' of dues ; in 5 fixed sums or a definite amount per employee is contributed annually; in 17 a percentage of the amount by the em- ployees, this percentage varying from 10 to 100 but most frequently fixed at 25 per cent. Taking 50 of these joint funds making complete financial reports for 1917, the sum paid in was $4,357,529, or $17.82 per member. Of this amount the firms contributed $498,322, or 11.4 per cent, while the employees contributed $3,857,207, or 88.6 per cent. In other words, the firms contributed $2.03 and the employees, $15.79 of the $17.82 — the total contribution per member. In all of these cases, however, the employers, at some expense, checked off dues from wages. In 36 cases they made no contribution in cash. Taking the remaining 14 cases, the firms contributed $498,322, or 12.8 per cent, while the employees contributed $3,397,595, or 87.2 per cent of the $3,895,917 paid in. This comparison is not entirely fair in one respect; some of these firms provided for a limited amount of medical treatment. Making due allowance for this, however, it can be said that except for the 11 employers' fund, and two or three other cases, the greater part of the cost of providing the various benefits rests upon the employees insured. The administration and support of these benefit funds usually go hand in hand. The members control and administer the employees' funds and the employers control and administer the employers' funds. The arrangements for the control and administration of the joint funds vary greatly. Ten cases were found where the expenses are shared by the firm and the employees, but the control and administration are vested entirely in the firm. In 46 cases where the firm bears a part of the cost by collecting the dues, the control and administration are in the hands of the members. In the remaining cases both the firm and the members have representation in the system of administration set up. This is a brief statement of the facts relating to establishment benefit funds in Illin^ois as found by the investigation made. A number of points of importance involving intensive study have not been ade- quately investigated. Whether the interests of the insured are con- 115 served by the administration^ how much objection may be made to com- pulsion and pressure found in a minority of cases, how far some of these systems may handican labor, if at all, in securing advances in wages, or in organizing, cannot be stated from the investigation made. It may be pointed out, however, that the establishment funds do not constitute a system. The employee, w4th unimportant exceptions in respect to the death benefits, is insured only so long as he retains employment in the given plant, or, possibly with the same firm. (3) Trade Union Benefit Systems. The labor organizations of the State provide insurance against sick- ness and accident for more workmen than have membership in establish- ment funds and provide death benefits or life insurance for a much larger number. The benefit phase of unionism has been extensively developed. Eather naturally (if strike benefits are excluded because of a very differ- ent character and object) this began by providing death benefits. Later, with the Granite Cutters' Union as the pioneer among national organi- zations, insurance against sickness and accidents was provided for in an increasing number of cases. Unemployment benefi.ts and superannuation benefits or old age pensions have come to find place in some of the systems developed. Taking the United States as a whole, a very con- siderable majority of union men and women are provided with death benefits by the national or the locafl union or both, as are a considerable percentage with sick and accident benefits. The provision of other benefits has not been so extensively made. The provision made by the unions has grown directly out of the need felt for meeting systematically the burdens connected with the mis- fortunes of wage-earners. It has replaced to an extent the extension of aid by donations, which is widely practiced where systematic provision has not been made or proves to be inadequate. An additional motive lead- ing to the emphasis placed by some organizations upon benefits is found in their value in attracting and holding members. They may aid in the extension of organization ; experience shows their value in conserving the membership built up. Sickness and accident benefits. — From data secured by correspond- ence and from reports and questionnaires, it is estimated that in Illinois there are somewhat more than 2,500 local unions with a membership of 410,000 or more. Approximately 41 per cent or roughly two-fifths of these members are connected with unions maintaining national or local sickness and accident benefit funds. From the available data it would appear that more than four-fifths of these are "beneficiary" members. Hence it may be said that about a third (135,000 to 145,000) of the members of labor organizations in the State when sick are entitled to benefits in accordance with the rules under which funds are administered. In some cases the provision for paying sickness benefits is made by the national or international union ; in others by the local union ; and. in some cases both. Of the nationals and internationals providing sickness benefits, 15 are represented in Illinois with 336 locals and 33,208 members. 116 Some of the locals of at least five of these fifteen organizations provide additional sickness benefits. As against this rather small number of unionists there are perhaps 380,000 in the State in some 2,200 locals not affiliated with the nationals or internationals which provide sickness benefits. More or less detailed information has been received directly from 898 of these locals with 194,524 members. Of these, 223 with 70,443 members were found to have made provision for paying benefits to those in the beneficiary list disabled by sickness. It is from the data obtained from these nationals and locals that the above 'general estimates have been made and the facts here presented have been selected. The benefit systems maintained by unions differ greatly in im- portant details — those relating to eligibility to the "beneficiary" class, waiting period, maximum number of weeks for which benefit may be paid, and the amount per week. There are no well-defined standards. In- asHiuch as details are presented elsewhere in this report,^ only the more frequent practice will be set forth here. Most frequently membership is compulsory upon the union men who can meet the requirements set up. Possibly limitations are made to exclude those who are over a certain age, or who have a chronic disease, or who cannot pass a medical examination. Likely, dues must have been paid for a time, most irequently for from 3 to 6 months, before claims to benefits may be made. All such requirements are, of course, for the protection of the funds. Taking the national unions, three-fifths have a waiting period of 7 days, the others 14 days. Benefits are paid in sums varying from $3 to $12 per week, with $5 as the most usual rate. This, as already indi- cated, is sometimes added to by the locals. The maximum period for which benefits may be paid varies from six weeks to two years, with three months as the most common period. Among the local unions in the State reporting to the Commission, 18 per cent have no waiting period; 2 per cent a waiting period of less than 7 days; 53 per cent 7 days; 14 per cent 14 days; the remaining 10 per cent, with one exception with 21 days, waiting periods of more than 7 but less than 14 days. The range of benefits paid is about the same as among the national unions, with an average of about $1 per day which is at present of course not as much as 25 per cent of the average earnings (of union men) . In respect to the maximum number of weeks for which benefits are paid, practically the same range is found as among the nationals except that it in some cases falls below six weeks. In connection with what has Just been said concerning the maxi- mum periods for which benefits may be paid, it should be stated that 19 national and international unions with 111,185 members in Illinois, provide for benefits in case of permanent disability. These are as a rule, however, disabilities resulting chiefly from industrial accident. Yet such disabilities as paralysis are included. The benefits vary up- ward from $50, and usually depend upon the length of membership or the amount of dues paid. In some cases the payment made is in lieu of a death benefit. «/Sfee Part II, Special Report XII. 117 There is almost complete absence of medical and hospital care among national and local union funds. Only four of the locals report attending physicians paid by the unions. A few state that hospital care and surgi- cal treatment are furnished in case of need. Only one well-developed organization for providing hospital treatment has been found — a co- operative miners' hospital at West Frankfort. This is a first class hospital, managed by a board of trustees from am»ng the miners, with a staff of physicians and nurses. It cares for both the miners and the members of their families, the expenses being met by the local unions. The administration of the union fund is usually in the hands of the regular union officials, with a "sick visiting committee." There is practically no cost of administration. When local the fund has the further advantage of a certain amount of elasticity in handling claims. Some of the nationals have experienced some difficulty in malingering and in excessive claims presented in times of wide-spread unemployment. N"one seems to have tried the plan of dividing the cost between the national treasurv and that of the local so as to secure the active co- operation of the locals in administering claims. The chief difficulty (other than the malingering reported in some cases) experienced by the locals has been due to the poor equipment in the great majority of cases for doing the necessary administrative work. The provision of benefits is after all an incident in the union's affairs. How much advance the unions may make in providinng sickness benefits is difficult to say. Such provision is instituted by new locals each year; at any given time a large percentage of the systems will be found to have been in operation only a relatively short time. Over against the cases of provision newly made, are found a considerable number where that which had been made has been discontinued as in- volving administrative difficulty, or "too much bother," or as requiring too heavy dues. Moreover, it may be said that there is a wide-spread feeling among union men that benefit systems make for conservatism and may stand in the way of a vigorous program of higher wages and shorter hours. Death benefits. — Combining data at hand it may be estimated that approximately 7 in 8 of the members of unions in Illinois belong to organizations paying death benefits or providing life insurance out of the local, state, or national funds. In some cases a small funeral benefit is paid also in the event of death of the wife, or dependent mother, or child. Our investigations show that 64 nationals and internationals with 1,591 locals and combined membership of 229,046 in Illinois, provide funeral benefits or life insurance ranging from $20 to $4,500. In between ten and fifteen per cent of the cases the locals add a second benefit to this. Prominent among the internationals not providing a death benefit is the United Mine Workers of America. In this case the State organization (District XII) pays a death benefit of $250. Where neither the national nor the State organization makes provision of this kind, our data from locals would indicate that about as frequently as not such provision is made by them. 118 " Perhaps a distinction should be made between the life insurance provided by a minority of the nationals and internationals and the death benefit commonly paid. Nine unions with a membership of 35,506 in the State write insurance contracts, the insurance usually being com- pulsory for those who can pass the necessary medical examination and who are not over a stated age. The insurance policies usually vary from $300 to $1,000 at ftie one extreme and from $1,500 to $4,500 at the other. The ordinary death benefit is, however, $50 or $100, but in some cases it is as much as $500 for members long in the union. (4) Insurance by Fraternal Orders. Most important of all institutions providing insurance for wage- earners and their families are the fraternal societies. In fraternal membership Illinois ranks first among the commonwealths. On Decem- ber 31, 1917 the fraternal orders providing life insurance and regulated under the insurance laws of the State had 1,043,469 members. To this membership must be added that of a number of orders which do not provide life insurance but some of which do provide health insurance. Using the data made available by the Insurance Department and by questionnaires and conferences the Commission estimates that the fra- ternal orders provide insurance of one or more kinds for at least 750,000 persons — men, women and children — of the wage-earning group in Illi- nois. The orders, taken collectively, provide life insurance and death benefits, "whole family protection^^ (juvenile life insurance), old age and disability benefits, sick and accident benefits, medical treatment and maternity benefits. And, as is well-known, they frequently make dona- tions to meet needs not covered by insurance. This aid must be kept in mind in connection with this summary of fraternal insurance."^ Of the various kinds of personal insurance, life insurance and death benefits have been most emphasized by the fraternal orders as a whole. The growth of their membership and business has been rapid in the United States. The Insurance Year-Book reported the insurance written by 489 of them in 1901 at $799,626,678; the number of certificates at the end of the year wa^ 4,518,955, their amount $5,655,453,465. Ten years later the reports for 397 showed $1,200,633,063 written during the year, 10,122,169 certificates outstanding, their amount $9,839,909,282. jMore recently their life insurance has been seriously aifected by the war situation. The new insurance written in 1917, according to the in- surance Year-Book (1918 edition), was $822,041,734; the number of cer- tificates outstanding, 7,456,551 ; the amount of insurance $9,129,974,447. A like movement has taken place in Illinois. On December 31, 1917, 149 fraternals were authorized to write life insurance in the State. These 149 had a total membership of 1,043,469, a majority of whom are wage-earners or members of their families. The amount of insurance in force December 31, 1917 was $1,164,545,418; the amount collected from members during the year for "mortuary indemnity and expense purposes,'^ $15,298,170; the amount paid out in settlement of claims in Illinois, $14,086,344. ■^ For a full account of fraternal insurance, see Part II of this report, Special Report VII. 119 Most of the fraternal life insurance in Illinois is on the lives of adults. However, previous to 1917 a few of the orders had provided for the payment of funeral benefits in the event of death of dependent children of members. The last General Assembly added an act^ to the statutes relating to fraternal life insurance organizations and author- izing them under certain conditions to issue policies providing "wholo family protection." This Act authorizes fraternal beneficiary societies to organize and operate branches for the payment of death or annuity benefits upon the lives of children between 2 and 18 years at next birth- day. The funds of such branch are to be kept distinct from the other funds of the beneficiary society, and are to be obtained from special dues or assessments and are to be based upon one of two experience tables. The maximum benefits are limited by a scale incorporated in the law, the scale varying from $34 for those 2 years of age, to $600 for those 16 to 18 years of age. This business cannot be entered upon or con- tinued with fewer than 500 certificates. The object of this law was to authorize fraternal beneficiary societies to provide insurance for the dependent children of their members cor- responding to that written by companies writing industrial life insurance. In the late summer of 1918, it was found that of the 149 societies author- ized to write life insurance in the State, 27 with 311,273 members had taken steps to provide this "whole family protection." At least 9 of these with 150,952 members had already placed the plan in operation. The fraternal societies are of course democratic, cooperative, non- profit-seeking organizations. That life insurance is provided by them in substantial amounts is shown by the figures presented above ; the amount of insurance provided on 7,456,551 certificates in effect in the United States as a whole December 31, 1917 was $9,129,974,447,or an average of approximately $1,224 per certificate. The one important shortcoming, and it is as important as it is unfortunate, is that in spite of an im- provement in this respect, the majority of the fraternal societies are not on an actuarially sound basis. Many of the older fraternals undertook to provide their members with life insurance because of their belief in the mutual principle and in protest against the stock companies with their reserves, their (then) treatment of withdrawing policyholders, and alleged frequent cases of mismanagement. The early societies collected assessments as needed to meet their obligations; sound actuarial principles were disregarded. Indeed, the slogan "keep your reserves in your pockets" was much used, and with the inevitable result that many societies became bankrupt and expected insurance was lost. Learning by experience, an increasing number of the older societies have made an effort to get upon a sound basis and those more recently organized have tried to avoid the mistakes of the earlier time. However, it has been a difficult matter to repair the injury wrought by the disregard of sound insurance principles. Many societies have struggled with the problem without complete success; and there have been not a few laggards. The result is that to-day the ma- jority of fraternals do not have sufficient assets, including receipts from *Act relating to Fraternal Beneficiary Societies, approved June 25, 1917, Laws of Illinois, Fiftieth General Assembly, 1917, pp. 544-546, 120 dues being collected, to cover their liabilities. In other words, the -majority of the fraternals cannot meet the test applied to the stock com- panies under the insurance laws. " According to the most recent report of the Commissioner of In- surance of Wisconsin, 12 of 20 societies organized under the laws of that state and 27 of 36 organized under the laws of other states, in 1917, did not have, as evaluated, "total assets available for payment of future death claims" sufficient to cover the "total net value of outstanding certificates (required reserve)."^ Indeed a very considerable number had a small percentage of the required (adequate) reserve. Though a majority of the societies found here have taken steps to place themselves upon an actuarially sound basis, the situation in Illinois is not materially differ- ent from that in Wisconsin. Insurance commissioners and general organizations of fraternal societies have given much attention to the problem presented by numer- ous actuarially unsound orders. One outcome was the so-called "Mobile Bill" adopted in 1910 by the National Convention of Insurance Com- missioners. In 1911 this was revised and amended and given shape in what is called the New York Conference Bill. The measure was de- veloped in conference with the representatives of the National Fraternal Congress and the Associated Fraternities of America. At the beginning of 1918 the New York Conference Bill, amended in some cases, was in effect in 28, the Mobile Bill (without the New York Conference Amend- ments), in 4 states. Six other states have legislation or insurance rulings based upon the same principles'^ as the New York Conference Bill. Illinois does not appear in the list of 38 states with legislation or rulings designed to meet the problem. The New York Conference Bill, in effect in 28 of the states, is designed to induce or to compel progress by the fraternal societies towards an actuarially sound basis. It provides for a valuation of the certificates of each society. If this valuation in any case showed that the present value of future net contributions, together with admitted assets of Decem- ber 31, 1917 were less than the present value of the promised benefits and accrued liabilities, then such society must maintain said financial con- dition at each succeeding triennial valuation. If the subsequent valu- ations do not show at least as good condition the insurance department "may proceed to cancel the societ3^'s license, or begin proceedings for the society's dissolution." Thus, the object is to bring about a gradual improvement in the condition of those fraternals whose condition is un- satisfactory. It is important that the laggards should be caused to make progress in this direction for actuarial unsoundness not only means un- certain life insurance but also causes many persons not to join these societies so as to obtain life insurance or the other benefits which many of them provide. Control* of the unsound society not only protects the certificate holders, but also makes fraternal societies in general more attractive to those eligible to membership in them. » See Wisconsin, Commissioner of Insurance, Fraternal Benefit Societies. Ex- tract from Forty-ninth Annual Report, pp. 3-25. The methods of valuation em- ployed are there shown. "Pacts taken from the 1918 edition of Statistics Fmternal Societies, p. 207. 121 * It has been found that at least 39 of the fraternal societies author- ized to write life insurance in Illinois, provide specific indemnities for loss of limb, loss of sight, loss of hearing, or other disabilit}'. These societies (December 31, 1917) had in Illinois a membership of 255,881, or about one-fourth of the total. Funeral benefits, as distinguished from life insurance, are sometimes provided by the local lodges. All told they have been found among the local lodges of 33 societies, but chiefly among those with German, Swedish, Polish or other members of mother tongue other than English. In some cases the provision of funeral benefits is made compulsory upon the local lodges, but in most cases, it is left optional with them. Where optional the provision of funeral benefits does not seem to make a strong appeal, no doubt because of the general provision of insurance in more substantial sums. As reported to the Commission, the funeral benefits range in amount from the cost of carriage or automobile hire and flowers for the funeral to $100, with amounts of $50 or $75 perhaps more frequently than any other. Much more important, for the Commission's purposes, than the insurance thus far mentioned, are the health and accident benefits pro- vided by the fraternal societies. In spite of extensive investigations and numerous conferences by its investigators with organizations and fraternal officers, the Commission is able to make only the roughest estimate of the number of wage-earners and their dependents provided with health and accident benefits by the fraternal societies of this State. It has secured data from 117 of the 149 societies supervised by the State because they provide life insurance and from 10 other societies which are not so supervised because they provide only disability benefits. It has secured returns, also, from 1,871 of 4,900 local chapters of these societies to which questionnaires were sent because the grand lodges were unable to furnish desired information with reference to any health and accident insurance they (the locals) provided for their members. It has been found that at least 32 of the grand lodges, with 146,493 members, provide sick and accident benefits. In some cases all eligible members are insured, while in other cases only those who so elect be- come beneficiary menabers. It is estimated that of the 146,493 members, 60,000 had health and accident insurance, and that approximately 40,000 of these were of the wage-earning class. It was found that 17 of the life insurance orders and 4 others, with a combined membership of 203,549, made the provision of sickness and accident benefits compulsory upon their local chapters. In most of these cases all who were eligible were beneficiary members. From the data at hand it is estimated that 175,000, of whom approximately 115,00i) were of the wage-earning class, had insurance in these local lodges. Again, it was found that 56 societies with 742,553 members made it optional with their local chapters to pro- vide sick and accident benefits. From the data obtained from question- naires it is estimated, roughly, that local chapters with a combined membership of 150,000 to 200,000, provided such insurance for their beneficiary members, numbering perhaps between 100,000 and 150,000. ^ 122 0-f these perhaps 75,000 to 105,000 would be of the wage-earning class. It was found, finally, that neither the grand lodge nor the local chapters of 19 societies provided health or accident insurance. Thus, data were secured from 127 societies and a considerable number of their locals. The total membership of the 127 societies was 1,223,054. It is roughly estimated that from 350,000 to 400,000 of these were provided with health and accident insurance by the grand lodge or by the local chapters or by them jointly, and that perhaps between 70 and 75 per cent of these were of the wage-earning class. In order to ascertain the number of wage-earners provided with health insurance by fraternal societies it would be necessary, first, to add a small figure for the societies from which no data were obtained, then, secondly, to make deductions for duplication of membership in two or more societies and for insurance of non-wage-earning members of wage- earning families. Obviously it is difficult to make proper allowances for these three. In the light of data at hand, however, the number of wage-earners provided with health and accident insurance by fraternal societies is placed between 225,000 and 275,000. Except for death benefits and life insurance, the one important benefit provided by fraternal societies, whether by the grand lodge or by the local chapter or by the two jointly, is for loss of earnings caused by disabling sickness or accident. As a rule the "loss of time" benefit paid makes no discrimination between sickness and accident cases, ex- cept, perhaps, in the payment of lump sums in cases of specific injury sustained. In describing the insurance provided it will be well to dis- cuss the provision made by grand lodges first and then that made by the local organizations. Just how much the grand lodges spend in sick and accident benefits in Ill inois cannot be estimated accurately from the Insurance Eeport because ot"tJie inclusion of other items with these. However, using the data in the report covering 1917, in the light of data obtained directly by the Commission, it would appear that something over $200,000 was spent in settling about 6,500 sick and accident claims in Illinois. The range of benefits paid by the grand lodges as reported to the Commission, was from $2.50 per week as a minimum to $120 per month as a maxi- mum. Seventeen of the societies reported benefits which vary in amount in accordance with the dues paid by the insured member or in accord- ance with this factor and the occupational or other hazard. One society offers benefits of $4, $6, $8 or $10 per week; a second, $5, $7.50, -$10 or $15 per week; a third, $1, $2, or $3 per day; a fourth, benefits varying from $15 to $100 per month. In two cases the benefits paid by the grand lodge begin after they have been paid for 3 months or 6 months by the local chapter. The other societies report waiting periods varying from 1 day to 2 weeks, but fixed at 7 days in a majority of the cases. The maximum benefit period (for payment of .the normal rate) varies from 10 weeks to 5i/^ years, but is most frequently 15, 16 or 26 - weeks in the year. In several instances, however, a smaller benefit is paid for a second period after the period for payment at the full rate has expired. 123 It is evident from this brief summary that there are great variations in the standards observed in the health insurance provision made by the grand lodges. This is equally true of the local lodges whether the provision is made compulsory upon or is optional with them. As has been indicated, many more wage-earners and their de- pendents are provided with health and accident insurance by local lodges than by the grand lodges. No record is available of how much is paid out in benefits by these local lodges. The benefits paid have been found to vary from $2 to $12 per week. Most frequently they are $3 or $5 or $7 per week, or $1 per day. There are also great variations in the waiting periods and in the number of weeks for which benefits may be paid. The most frequent waiting period is, however, one week. The. maximum number of weeks in the year for which benefits may be paid is most frequently 13, but a maximum of 26 weeks is not uncommon. Nor are shorter periods uncommon, maxima of only 6 weeks being found. Thus it may be said that the sickness benefits provided by fraternal societies are far from being standardized. It may be said, also, that the provision made by the locals is on the whole less generous than that made by the grand lodges. It is evident^ moreover, that most of the benefits paid are relatively small. Of course where the management is good the members collectively get in benefits most that they pay in dues for the expenses of administration are relatively low and these societies are non-profit-making institutions. The benefits are generally small because dues are low. The dues are low because the members do not feel able or do not care to pay more for health and accident insurance. The amount paid in dues is more frequently 50 cents per month than any other sum. However, in some cases it is as much as $1 per month, while, on the other hand, the local chapters of one large society collect only 50 cents per quarter from those insured against sickness and accident. About one grand lodge in eight provides for the payment of total and permanent disability benefits. Among those reporting to the Com- mission were sixteen which pay sick benefits for permanent and total disability arising either from sickness or accidental injury, the sums paid varying gr-eatly from one society to the other. In some of these cases the sums paid are charged against the life insurance carried ; in a very few they are provided as an additional benefit under life insurance carried; in most cases, however, the members have the option of secur- ing such insurance by the payment of additional dues. In describing the health and accident benefits provided by fraternal organizations, attention should be called to restrictions designed to safe- guard the funds against "bad risks." The '^^insurance orders" require a medical examination as a condition of admission. Where disability benefits are not provided incidental to life insurance, medical examin- ation is generally required for admission to the special fund. Again, in many cases benefits are not paid or are paid at a reduced rate in cases of chronic disease. Moreover, benefits are not as a rule paid where the disability is due to immoral conduct. Again, age limitations are found in connection with the rules relating to the admission of members, those over 50, 55, or 60, say, not being accepted. Furthermore, in some cases 124 insurance against disability ceases automatically at a given age, say 50 or 60, or benefits are paid only at a reduced rate. A considerable number of the local lodges providing cash benefits in cases of disabling sickness or accident, provide medical care, and, now and then, nursing service and hospital treatment as well. From data at hand it would appear that less than a fifth of the locals paying a cash benefit provide medical care also. Where medical care is provided it is given by the "lodge doctor" who is most frequently paid $1 or $2 per member per year. It seems to be the general opinion among doctors that this "lodge practice'' does not as a rule result in efficient treatment of the sick. Mne of the fraternal orders reporting to the Commission provide maternity benefits. One of these pays a lump sum of $10, and the regular sick benefit for any disability lasting more than 30 days after confinement. Another pays a sum twice as large as the weekly sick benefit. A third, under a new "law" adopted in 1917, pays a lump sum of $50, the funds required being obtained from dues paid by those in- sured for this special benefit. These, stated in summary form, are the benefits of immediate inter- est to this Commission, provided by fraternal organizations. The frater- nal societies are of first importance in providing health insurance for the members of the wage-earning group in Illinois. (5) Foreign Benefit Societies. With insurance by fraternal orders discussed, little need be said concerning the benefit systems maintained by independent foreign societies, for these societies are merely local fraternals organized on a race (or language) basis. The main differences between these societies and the fraternals discussed above are due to the facts that the former are small and much more unstable than the latter and are entirely un- regulated under the insurance laws of the State. The population of Illinois contains a large percentage who are foreign born and of mother-tongue other than English. Prominent among them the Germans, the Scandinavians, the Italians, the Poles and the Bohemians may be mentioned. When of recent immigration, they tend strongly to organize their own societies for various purposes, among them to make provision to meet the problems connected with sickness, accident and death. Such societies are found in largest num- bers in Chicago, but are found in smaller numbers in other industrial centers where any considerable group of a non-English speaking race reside and work. Elsewhere in this volume a special report is pre- sented setting forth the results of a special investigation of typical societies studied in Chicago. ^^ In general the results apply equally well to North Chicago, Waukegan and other places where similiar organi- zations exist. Excluding singing societies, athletic clubs and the like, a list has been prepared of approximately 600 independent foreign societies in Chicago. Of these approximately half have political, educational or social interests only. The others, totaling 313, add to such interests as these benefits of various kinds. A study has been made of 161 of ^^See Part II, Special Report X. 125 these 313, their combined membership being 21,024, or an average of about 130 each. Of the IGl, 34 had fewer than 50 and 85 fewer than 100 members; only 19 had as many as 300 and only 5 as many as 500 members. The small membership of most of them is an important fact. If those studied are typical of the larger number the membership of independent foreign benefit societies in Chicago would be something more than 40,000. As would be expected, most interest is displayed in death benefits. No fewer than 125 of the 161, with 18,336 members, pay death benefits, most frequently in the sums of $50 or $100, or a similar sum derived from an assessment levied upon the membership. The minimum sum found was $15, the maximum $250; the average amount paid in 250 cases in 1917 was approximate^ $145. In short, most of the mem- bers of these foreign societies are provided with funeral benefits. Here and there smaller sums are provided in the event of death of wife or other dependent. Only less important is the provision for paying cash benefits in cases of sickness and accident, whether occupational or non-occupational. Such provision was found in 95 societies with 12,070 members or about 57 per cent of the combined membership of the benefit societies studied. As would be expected, the systems were found to be multi-form; no approach to a well-defined standard had developed. Some require a medical examination as a condition of admission to the system main- tained, others do not. Some have very short waiting periods, a large number a waiting period of 7 days, some a waiting period as long as 2 wrecks. Some pay benefits from the first day of disability, others from the end of the w^aiting period. Seven pay benefits for a "normal" period of not to exceed six weeks; 44 for more than 6 but not to exceed 13 weeks; 43 for more than 13 but not to exceed 26 weeks; one for a longer period. Of the 95, 32 pay benefits at a reduced rate, usually half of the normal sum, for a second benefit period. The "normal'^ benefit varies all the way from $2.50 to $15 (in one case) per week. It is not in excess of $5 in 71 cases ; more than $5 but not in excess of $10 in 22. Thus it would appear that the benefits are usually comparatively small. The rates have been fixed in view of the once small earnings of the immi- grant and have become more or less customary. Another factor enter- ing in is that only small dues can be collected and these will support only small cash benefits. Comparatively few of the societies have made systematic provision for medical or hospital treatment. However, of the 161, 19 with 2,545 members, have '^society doctors'^ to provide medical treatment, the most usual arrangement taking the form of a per capita fee of $1 per year. One Croatian and 8 Greek societies with 1,535 members had made arrangements for needed hospital care. In some cases the entire bill is paid; in others from $7 to $15 per week is paid for six, eight, ten, twelve, twenty-six, or (in three cases) an indefinite number of weeks. This is a brief statement of the systematic provision these inde- pendent foreign societies have made for meeting the problem they find connected with sickness, accident and death. It is important to note, however, that they do not limit their mutual aid to the settlement of insurance claims. These and the non-benefit societies, like trade unions 126 and other mutual organizations, extend aid more or less liberally out- side of the insurance departments which may have been set up. As a result of the investigation undertaken it was hoped definite information would be obtained relating to the actuarial soundness and fitness of these organizations in other respects to serve as insurance carriers. This hope has been realized only to a slight extent. It can , be said, however, that most of them are too small and too short-lived to provide life insurance in small amounts without great risk of dis- appointment, or to develop able management. There is more or less failure to observe good insurance principles, and now and then funds have been lost through failures of private banks in which they are fre- quently deposited, or by unwise investment. The most important fact is, however, that they are small and unstable organizations. Though the organization mortality cannot be measured, because of the absence of lists of these societies for earlier times, the information secured from well-informed men supports the usual assertion to the effect that it is very high. They appear, and, for the most part, sooner or later dis- appear as independent organizations. Many, to the advantage of their members, affiliate with national fraternal orders. Many die. Perhaps the members move away from the community as other immigrant races move in or the old members die and their native offspring do not generally join the foreign organization. In all probability dues have not been based upon the whole life of the member, the needed succession of young lives is not forthcoming, the average age of the members in- creases and the risks become greater, with the inevitable result that the institution is not in a position to compete on good terms with other insurance carriers. Decay and dissolution and loss of expected death benefits are naturally of more frequent occurrence among these inde- pendent foreign societies than among other organizations providing insurance. If the foreign societies were more generally founded on good in- surance principles, w^ere larger, and there was a greater guarantee of efficient management, their value would be distinctly greater because of a more successful appeal to those eligible to membership and the less frequent cases of disappointment and loss. (6) The Health and Accident Business of Casualty Insurance Com- panies and Assessment Associations. As another type of carrier of health and accident insurance we have the casualty and assessment companies, and the stock life insurance companies which, upon compliance with certain conditions, may engage in the health and accident business. Some of the policies written cov6r sickness only, others accident only, and still others both sickness and accident. A rather detailed account of this insurance will be found elsewhere in this report.^^ Here only a brief summary of the business of the casualty companies and assessment associations will be presented, and that part of it taking the form of liability insurance and written for employers will be excluded because not in point. The time of our investigations made it necessary to use data for the year 1917. On December 31 of that year 76 casualty companies " See Part II, Special Report VI. 127 were authorized to write health and accident insurance in Illinois. The best estimate we have been able to make from existing reports and re- turns to questionnaires is that in 1917 these companies had approxi- mately 250,000 health and accident policies in effect in this State. The number of policy-holders would be somewhat less for some carry more than one policy. It would appear that a majority of them are business men, professional men, farmers, and others of the non-wage-earning classes. It would perhaps be not inaccurate to say that about 100,000 of the Illinois holders of the health and accident policies outstanding against the companies December 31, 1917 were wage-earners, or of wage-earning families. Most of these are the more highly paid wage- earners, chiefly mechanics and other skilled laborers. The health and accident policies of casualty companies may be classified as "commercial" and "industrial." Commercial policies com- monly provide weekly benefits to compensate for loss of time from dis- ability due to sickness or accident, as the case may be, ranging from $10 to $50 or more and other benefits correspondingly high, and are usually sold on the annual premium plan. Industrial policies provide smaller benefits, ranging from $20 to $125 per month for total disability result- ing from accident or disease, and are usually sold on the monthly premium plan although some are purchased by quarterly and many by weekly premiums. The commercial policies are designed to meet the needs and preferences of business and professional men and the better- paid salaried employees. The industrial policies, as the name suggests, are intended to attract wage-earners. For the greater part the policies are individual. Insurance of groups of workmen is comparatively new and as yet not extensive. This phase of insurance will be discussed in a later section (8) of this chapter. Health insurance formerly sold by casualty companies insured against disability resulting from only a limited number of diseases, which were of course enumerated in the policy, but contracts which insure against nearly all diseases are now sold by most companies. Complaints, misunderstandings, incisive criticism by insurance com- missioners and competition among the companies have caused the policies to be liberalized so that, taken as a whole, they are materially different from what they once were. The policies most frequently employed ex- clude disability due to venereal disease, diseases not common to both sexes, and a few other causes of no special importance in so far as wage- earners are concerned. Limited policies, insuring against disability arising from one or more of a certain number of diseases, or excluding disability due to certain diseases (such as tuberculosis) not mentioned above are sold. It should be stated here, also, though it is mentioned below, that different rules may be applied to disabilities due to different diseases, those of frequent occurrence and whose duration is likely to be long being treated less liberally than others under the insurance contract. In deciding as to the eligibility of an applicant for health or acci- dent insurance casualty companies consider sex, age, race, physical characteristics and condition, occupation, place of residence, other health or accident insurance carried by him and the relation between his in- 128 come and the total benefit which he could claim under all policies carried in case he were disabled by illness or acidental injuries. Applicants are generall}- inspected; doubtful risks are given medical examination. Some companies insure "male risks^' only; others accept "female risks'' under contracts drawn exclusively for women ; while others insure men and women on the same terms. The companies which discriminate against women assert that they are more frequently disabled, or that they present a greater problem in malingering and simulation; or that the recorded experience is inadequate to serve as a basis for scientific rates for them. Usually those under 18 or over 60 or 65 are not ac- cepted for health policies; those up to 70 are commonly accepted for accident policies. The data at hand indicate that some of the companies do not accept as risks those of certain races. A number have stated that their experience had been so unfortunate in insuring persons of one or more of certain races specified that they no longer accepted them as risks. Those engaged in certain hazardous occupations are not ac- cepted, but these non-insurable occupations are comparatively few. Some companies have reported that they write no business in certain com- munities because of unsatisfactory health or moral conditions. More frequently the business does not extend to a community because the prospective profit is not sufficiently attractive. Health* and accident policies are renewed by payment of the premiums. They lapse with failure to pay. They may, however, be can- celled by the company at any time by returning the unearned premium, and they are frequently cancelled when risks prove to be bad or unsatis- factor}", because of frequent disability or submission of unwarranted claims. Under the health and accident policies sold by casualty companies, various benefits ("indemnities" they are usually called) may be pro- vided. The most important, in fact the only important one, is that for "loss of time." The amount of the benefit per week or month is stipulated in the contract, but in order to prevent over-insurance, it is ordinarily fixed in a sum less than the income of the insured. Perhaps it will be not in excess of half, or two-thirds or three-fourths of his in- come. It is likely, however, to be larger than the benefits paid by es- tablishment " or trade union funds. The insurance company wishes to write the largest possible policy with the necessary margin of safety, while the establishment and union funds most frequently use a more or less customary sum fixed in vieAv of the minimum cost of living. The industrial policies most frequently sold provide for monthly "indem- nities" of $45 or $50 for "total disability." Policies providing for indemnities as low as $20 per month are not uncommon, however, while some providing benefits as high as $100 or $125 per month are sold. In some cases the rate of benefit increases with the life of the policy. This is designed to reduce the number of lapses. The commercial policies most frequently sold in Illinois, in case of "total disability,^' provide benefits for a period limited to 52 weeks. Benefits under most industrial policies are limited to 6 or 8 months. These are the more usual maximum periods for disabilities due to one or more of most diseases. The organized insurance business is conducted 129 for profit, and many of the policies restrict the payment of the usual weekly or monthly benefit in the case of certain chronic diseases and diseases of long duration to a fraction of the maximum period. Thus one rather liberal policy with a twelve months maximum limits payments in cases of paralysis, tuberculosis, cancer and locomotor ataxia to six months. Another policy, with six months as the maximum in any twelve, limits the benefits to one month in any one policy year in case the insured suffers total disability by reason of rheumatism, tuberculosis, paralysis, neurasthenia, sciatica, Bright's disease, apoplexy, locomotor ataxia, cancer, neuritis, sprains or strains, lumbago, orchitis, hernia, or any chronic disease. Some policies carry a still longer list of diseases for which the indemnity is limited to a fraction of the usual period. These are serious limitations from the point of view of adequacy, though the lower premium paid for such policies may give as much protection for the money paid as is given by the more liberal policies sold at higher rates. "Total disability" usually means one that confines the injured to the house or prevents him from attending to his business or occupation. Payments are made upon a doctor's certificate. The law of Illinois re- quires that upon request of the insured payment shall be made at least once in every 60 days of half or more of the "indemnity" which has accrued since the last pajnnent and that any balance remaining unpaid at the termination of the period for which the insurance company is liable shall be paid immediately upon receipt of due proof. Most of the policies sold in Illinois provide for the payment of installments of the benefit every 30 or 60 days. Less important than that just described are the partial disability, the convalescent, hospital, operation, nursing, and blindness and paralysis or other permanent disability benefits provided more or less frequently under health and accident policies. Most policies provide either the first or the second of these, the first for a limited period, usually falling within the maximum for total disability, the second usually limited to one or two months under industrial policies, and both at perhaps half the rate paid in case of total disability. Many of the policies provide for partial or complete reimbursement of the insured for his hospital ex- penses, and cost of operations. The allowance for operations is usually according to a scale the figures in which are lower than the fees com- monly charged by surgeons. The hospital "indemnity," usually limited to 3 months under industrial policies, may be the usual weekly benefit or a fraction of that sum. These two indemnities are frequently exclusive ; only the one or the other may be claimed. Payment to cover nursing care is infrequently provided for and in non-hospitalized cases ; the other indemnities, including medical treatment in cases of non-confining sickness, may be passed over as of little importance in showing the general character of this health insurance. The variations found in the treatment of accident cases need not be set out.^^ The health insurance provided by casualty companies differs eo greatly from that provided by the establishment funds, unions and • "An of these are adequately presented In Part II of this report, Special Report VI. — 9 H I 130 fraternal orders that few comparisons can be made between them. Moreover, there is no well-defined standard observed by any one set of carriers. It may be said, however, that the policy contracts of the in- surance companies have been liberalized until their provisions are on the whole as liberal in their coverage as the provisions of most of the other carriers. Whether we consider establishment funds, union benefit systems, fraternal orders or casualt}^ companies frequent instances are found in which those disabled by reason of certain diseases are not insured. In re- spect to the maximum period during which the benefits may be claimed and the rate paid, the insurance provided by casualty companies appears more nearly adequate. On the other hand, however, the casualty com- pany as a business institution disposes of claims in more strict accord- ance with the provisions of the insurance contract. This is not neces- sarily the case with the local fraternal order, the establishment fund, and the union fund. Here there is more -elasticity and a freer hand in administering the benefits so as to take care of needy cases. The chief advantage these carriers have over the company carrier is, however, found in the net cost of the insurance provided. The premiums paid for policies written by casualty companies can- not be compared directly with the dues paid into funds of these other carriers because of difi^erences in the protection afforded. Moreov^er, while the dues charged by other carriers are commonly fixed without regard to age, the premiums charged by casualty companies increase with age over fifty because of the greater hazard. Again, the premiums charged by casualty companies vary widely because of differences in occupational hazards. Yet a few comparisons can be made between what the insured pay and what they get collectively. If the diversion of union insurance funds to other purposes is excepted, the insured receive back what they pay in less the cost of administration which is most fre- quently less than 10 per cent and not infrequently only 1 per cent or nothing. In the case of establishment funds the relation between sums paid "in and the amount paid out varies with the method of support, but unless wages are kept on a lower plane because of the benefit system maintained, even in those cases where the members are the only con- tributers to the fund, all but a small percentage of what is paid in by all is paid out in benefits to the disabled. The fraternal carriers com- pare favorably with the unions. In the case of the casualty companies, however, the insurance is expensive and for obvious reasons. Combining the figures for Illinois business as reported by casualty companies to the Superintendent of Insurance for the four years 1913- 1916, it is found that the health and accident premiums (net) collected amounted to $12,655,973.18, the losses paid to $5,300,176.55. The ratio of losses paid to premiums collected was 41.88 for the four years. The premiums collected in 1917 were $3,848,485; the losses paid $1,891,894; the ratio of losses paid to premiums collected 49.16. Hence it may be said that less than 50 cents on the dollar has been returned by the casualty companies to policyholders in Illinois; during these years more than 50 cents plus the additions made to the collections through investment has gone to the companies to cover the expenses of business acquisition, the expenses of management — both of which are 131 necessarily large, and to constitute profit on the business, or has been added to the necessary reserve fund. Making allowance for the reserve fund perhaps half of the premiums have not been returned or credited to the policyholders. The reason why this kind of insurance is so expensive is found chiefly in the great cost of acquisition when individual policies are written. The agents, competing for "prospects,'^ must necessarily be paid high commissions. In the language of the profession this insurance is sold, not bought. The insured are not grouped as employees of a firm, or as members of a union or fraternal order. Prospects must be visited individually in the home or at the place of work. Moreover, it is said "statistics show that one out of every ten prospects properly approached becomes a policyholder."^'* Again, the premiums due from policy- holders must be collected. The '^Accident Insurance ManuaP for 1918 states (p. 4) that "relatively the commissions paid to the sellers of in- come insurance * * * ^pg higher than are paid to salesmen in any other legitimate calling," and, further, that "the renewal commissions, that is, the compensation paid to those who have originally sold this necessary of life and who have placed the annual or semiannual renewal of the contract, are constant — not reduced, as in other forms of insurance." A tabulation of the reports (for their entire business) submitted by 35 companies doing business in Illinois and reporting the health business separately shows that in 1917 they received $9,925,041.55 in net premiums and paid out $2,756,799.37, or 27.78 per cent of this sum in commissions and brokerage. A like tabulation of the reports sub- mitted by 22 companies reporting health and accident insurance com- bined shows that they received $13,744,294 in net premiums and paid out $4,100,018.15, or 29.8- per cent of this sum in commissions and brokerage. These percentages are averages. The commissions (when straight fees are paid and not a commission and a policy fee) sometimes run above 40 per cent, sometimes as low as ten per cent, but most fre- quently approximate 30 per cent or 30 cents on the dollar collected. At any rate such is the conclusion arrived at from an examination of sworn returns made to the Insurance Department of Wisconsin two years ago. Voluntary insurance written on individual policies is and must be expensive because of the conditions under which it is carried on. Partly because it is expensive the lapse ratio is high. Twenty-four of the companies reported to the Commission with reference to the life of their policies. The average longevity of commercial policies, according to these reports, would probably be about three years; that of the in- dustrial policies between six months and one year. From the survey made for the Commission it would appear that though health insurance written by casualty companies is comparatively new and the great majority of wage-earners are still ignorant of such merits as it has, it cannot be expected to become general if written on individual policies and not combined with life insurance. Several suggestions have, however, been made for writing it in group form. This is discussed briefly in section '8' of this chapter. " See Part II, Special Report VI. 132 The assessment associations, unlike the casualty companies, are mutual organizations operative on the assessment basis, and without a capital stock. Under the Illinois law they are authorized to write j health and accident insurance and to provide a funeral benefit of not to exceed $100. In 1917 there were 22 assessment associations writing insurance in Illinois. At the end of the year they had 228,000 certificates in force; during the year they received from their members for indemnity and expense purposes the sum of $2,067,324, and paid in death, permanent disability, sick and accident claims the sum of $1,032,312.37. i^bout 75 per cent of this latter sum was in settlement of sickness and accident j claims; most of the remaining 25 per cent was paid out in death or funeral benefits. Though a number of these associations write insurance chiefly for wage-earners and a few of them employ the weekly-premium method, no fewer than 178,875 of the 228,000 certificate holders mentioned above, were members of organizations limiting themselves exclusively or almost entirely to the insurance of business men and commercial travelers. Of the remaining 49,155 certificate holders, not to exceed 40,000 were of the wage-earning group. In essentials the health and accident insurance provided by these associations is very much the same as that provided by casualty com- panies. While it may be somewhat cheaper, as claimed by the officers of the associations, the expenses of some of the organizations special- izing in industrial insurance are relatively heavy, and the amounts ex- pended are small in comparison with the amounts collected. In one ex- treme case the collections in four years totalled $134,922; the Gum spent in the payment of death, sickness and accident claims was $41,075 ; the commissions and fees paid to its agents aggregated $51,969 ; the salaries paid to various officers amounted to $30,495. Another asso- ciation during this same period collected $225,859 from its members and paid $53,130 on account of claims presented. From the data available it appears that the number of lapses is large. Leaving out the organizations providing insurance chiefly for business men and commercial travelers, the number of policies written, restored, or revived in 1917 was 64,733; the number terminated (chiefly by lapse), 45,334; the number in effect at the end of the year, 49,155. (7) Industrial Life Insurance. Among the many subjects under investigation by this Commission, that of industrial life insurance has been of special interest for it is written chiefly on the lives of wage-earners and the members of their families and is designed to provide "funds necessary to assure a decent burial and the expenses for medical attendance during last illness.''^^ The industrial life insurance business of the older companies now engaging in it dates from the 1870's— about 45 years ago. It has grown rapidly in the United States especially during the last fifteen years, until in 1918 the number of industrial policies in force has been estimated at 38,000,000.i« The aggregate amount of industrial life 15 Quoted from Huebner. Life Insurance, p. 275. i« The Spectator, December 12, 1918, p. 23. 133 insurance in force January 1, 1918 was reported at $5,223,415,465;^^ by the end of the year it no doubt approximated five and a half billions. A large proportion of wage-earning families now make use of it, and it is more frequently found among them than the insurance provided by any other carrier. In this Illinois is no exception to the rule. With 11 companies writing industrial policies at that time, the number in force in the State December 31, 1916, was 2,306,458. The amount of industrial insurance was $306,616,086, which gives an average of $132.94 per policy. It is safe to say that making allowance for the fact that a considerable number of policyholders carry two or moi'C policies, there were at that time approximately 2,000,000 holders of industrial insurance policies, and that the great majority were wage-earner^ and their dependents. Industrial life insurance stands in contrast to "ordinary life'"' in several respects. Premiums on it are collected weekly and at the home ; on "ordinary life" they are usually paid semi-annually or annually and at the main office. The principal is adjusted to the weekly premium (3, 5, 10 or 15 cents, etc.) in the. case of industrial insurance; the premium is adjusted to the principal in the case of "ordinary life." In- dustrial life is written for both adults and children, while "ordinary life" is written on the lives of adults only. Some of the above contrasts are of importance in connection with points to be discussed below. Industrial life insurance, unless it is permitted to lapse, is a certain method of providing funds for the last illness and for burial. The num- ber who discontinue their insurance is by no means small. Yet the number of lapses in a year except among the newer policy-holders where it is great, is not large for unless a more substantial amount of insurance can be carried, this minimum is very much desired. Moreover, the agents are very much interested in preventing lapses, for their remuner- ation varies directly with the net amount they add to their total of weekly premiums. The chief criticism made of industrial life insurance is, however, that it is expensive. Now and then comparisons are made of the greatly different amounts of protection secured for a given outlay from industrial and from ordi- nary policies. Such comparisons have only a limited value, however, for the risks differ greatly. Partly because of the less careful selection of policyholders and partly because of the higher mortality among wage- earners and other classes for whom industrial insurance is written, "the number of Industrial deaths per 100,000 policyholders exceeds the num- ber of ordinary deaths at the same ages all the way from about 20 to 50 per cent."^^ More frequently, in this connection, comparisons are made between premiums collected and death claims paid.^^ Thus in Illinois during the six years 1911 to 1916, the premiums received on industrial policies amounted to $50,572,117.48, the losses paid, to $14,180,624.68. The corresponding figures for 1917 were $11,360,001.28 and $3,470,266.45. ^^ Ibid., September, 12, 1918, p. 143. " See Part II of this report. Special Report VIII. ^^ See especially Report on Health Insurance, Massachusetts Commission, 1917, p. 33. Thus the losses paid mmng the period 1911-1916 .were 28.04 per cenTT in 1917, 30.05 per cent of the premiums collected. Such comparisons, however^ greatly exaggerate the difference between what the policyholders pay to the company and what they in return receive from it, for they fail to take into consideration dividends, surrender values, and necessary reserves. The large companies now writing industrial life insurance have been mutualized; perhaps 90 per cent of the policies are participating, i. e. the policyholders receive dividends. Again, after a period of time the policies have surrender values; many discontinue their industrial insurance and take out ordinary policies and the surrender values are applied to them. And, finally, as in connection with ordinary policies, reserves must be carried to' cover the higher mortality as the adult policyholders increase in age. While the business is rapidly expanding the amounts added to reserve must be substantial. The importance of some of these considerations is shown by data for the three largest in- dustrial companies, for the year 1916. According to their reports to ' the aSTew York Insurance Department the three companies collected in premiums on their entire industrial business, a total of $151,367,823.57. The death claims amoanted to $49,937,632.65 or 32.92 per cent of this. The amount paid out in "surrender values^^ was $2,578,295.54, in divi- dends paid in cash or applied to insurance $14,651,022.81. These two sums bring the total returned for the year by these three companies to their policyholders up to $67,166,951, or 44.37 per cent of the premiums. An additional and substantial allowance must be made for necessary reserves. And, on the other hand, earnings from the premiums and invested reserves should be taken into consideration. Perhaps the fairest comparison made of what industrial policy- holders pay and what they in return receive is that prepared three years ago for the National Convention of Insurance Commissioners by its Committee on Social (Welfare) Insurance.^^ The following figures were presented for the three largest companies from the date of beginning of their industrial business down to December 31,1915. Total premium receipts, $1,811,843,770; total interest income, etc., $195,631,582; total receipts, $2,007,475,352; total payment to policyholders, $713,477,427; total funds credited to policyholders, $529,765,435; total payments and credits $1,243,242,862 ; pereenta2:e of payments and credits to receipts, 61.9. With fair comparisons, it may be said that not far from two-fifths of the money paid by policyholders is not returned to them. The explan- ation of this fact is found in the organization required for the conduct of the business as industrial policies have been written. Agents make the rounds of the homes in their several districts writing new policies and collecting the weekly premiums; for the three largest companies their commissions and the agency and supervisory expenses were in 1916 20.11 per cent of the premiums collected. Moreover, a complicated system of bookkeeping is required, and this, auditing and the other de- 20 The Commission is indebted to Rufus M. Potts, Chairman of the Committee, for the privilege of making use of this manuscript report. 135 tails in management, for the three largest companies, brought the entire expense up to 26.99 per cent of the premiums collected. The writing of industrial life insurance on individual policies is necessarih' expensive. At one time it and health insurance were com- bined, but not with satisfactory results. Such a combination, if success- fully worked out, would reduce the expense of management and make the life insurance less expensive. At present attention is being given to the development of group life insurance. Whether groups were written by private companies or under a state controlled system, the acquisition costs would be very much reduced. Group insurance is discussed in the next section of this chapter. It should be said at this point, however, that a large percentage of wage-earners are not brought together in their places of work in sufficiently large numbers to constitute insurable groups. It should be added, also, that under any system of insurance of wage-earners only, many persons now insured would find no place. In- dustrial insurance as now written is for wage-earners and others, in- cluding wives and children not gainfully occupied. Our block studies in Chicago show a larger number of dependents than of wage-earners carrying this form of insurance. (8) Group Insurance. Group insurance, as it is written to-day, is essentially a plan for selling insurance at wholesale rates to an employer to cover the risks of his employees. For the most part it is a cheaper method of providing life insurance than on individual policies. Only here and there are group health and accident policies being sold. However, a representative of the casualty companies has stated at the public hearings held by the Commission that group health and accident policies give a very desirable form of insurance and that the health and accident hazards of 60 per cent of the wage-earners can be covered in this way conveniently and at a relatively low premium cost. Because of the progress it is making in the field of life insurance and because of the prospects it is claimed to hold forth in the field of health and accident insurance, group insurance is of unusua.1 interest. Because of the wide-spread interest in and claims made for group insurance the Commission has made as extended an investigation of it as the circumstances would permit. The results of this investigation are set forth at some length in another part of this report.^^ At this point a brief summary of the results there presented will suffice. Group life insurance may be discussed first, and then a short statement added concerning the comparatively little group health and accident insurance now sold. Group life insurance. — Now and then group life insurance is written on individual policies for the employees covered, but the most general practice is to issue it on a "blanket" policy which covers the lives of the members of the group. The group insured, it may be said, may be of the salaried employees only, or of the employees of a certain department or of certain departments only, or of the employees of all departments of "See Part II, Special Report IX. 136 the business. It is written after a census or list of the employees is prepared giving their age, sex, etc., and after an inspection of the men, the plant, and the conditions under which the work is done. Medical examination of the employees is not made, but only such exceptions are permitted of men in a group of emplo yees as will not result in a selection of risks adverse to the insurance company. In other words, only such definite factors as age and length of employment may be used in making exceptions; those eligible must be included in the group of the insured. •With these safeguards and with a minimum of 50 or, more likely, 100 the group, medical examination may be dispensed with without a m 4 violation of actuarial principles. Occasionally, it is true, groups of less than 50 are insured but in such cases a medical examination, usually in modified form, is made of each of the men accepted. The policy is issued to the employer who pays the premium and assumes the responsibility for the collection of any part of the cost charged to the employees. Benefit certificates are generally issued to employees; the insurance may be paid directly to the beneficiaries named in each casC' but more likely payment of claims is made through the employer. Group insurance is usually term insurance and most frequently takes the form of a one-year renewable policy. The policy may carry a guar- antee of rates for a period of years, and, like individual life policies, may be participating or non-participating. The rates are based upon the risk involved in the given case and the premium paid is the sum total of the rates for the several employees on the list. This list is revised with changes in the personnel of the working force and adjustments are made periodically in the premium, the amount being increas ed or d ecreased as needed in view of changes in the group covered by the "policy? When an employee is laid off his insurance may or may not be continued while he is not on the pay-roll; the practice varies. When he is discharged or leaves the firm^s employment, however, his insurance under the group policy ceases. But in this connection it should be said that many, and perhaps a majority of the group policies in force contain a "conversion clause" under which such a man may upon application, say within 31 days, and without medical examination, obtain an individual policy (but usually not for term insurance), at the rate for his attained age^ The only advantage this right of conversion carries with it, is of course that it eliminates the usual medical examination. Because it saves the "bother" connected with this and enables some to qualify for insurance who could not pass the medical examination^ the right is sometimes re- garded as one of great value. As a matter of fact the opportunity offered by it is rarely embraced, for one reason because few when dis- charged or leaving a place of employment are in position (at just that time) to add to the insurance they carry on individual policies. It is chiefly those who leave one firm to accept employment at good wages with another for whom it has value. This is a brief, and because brief necessarily an inadequate, descrip- tion of group life insurance. From an insurance point of view it seems to be written with proper regard for good insurance principles. The 137 writing of such policies has been authorized in most states, with mini- mum groups of 50 or 100. Though older instances are placed in evidence, from a practical point of view group life insurance is a new device. It is commonly said to date from 1912 when a group policy was issued to a prominent Illi- nois mercantile firm. During the last five years it has made rapid progress in the United States. According to the Actuaiy of the Con- necticut Insurance Department, the number of men thus insured in this country Increased from 11,450 December 31, 1912, to 105,000 on the corresponding date in 1915, and to 325,000 June 30, 1917. The amount of insurance in force was $13,083,000, $83,920,000, and $250,000,000 for these three dates. Most of this insurance has been written by five companies; it is only recently that any considerable number of com- panies have undertaken to write insurance in this form. The five prin- cipal companies have reported to the Commission with reference to their policies in Illinois. Beginning with 2 in 1912, they had 31 in force December 31, 1916, and 66 December 31, 1917. For the second date the number of employees covered was 3,129, the amount of insurance, $2,809,676; for the last date the number of employees covered was 24,877, the amount of insurance, $20,092,851.^^ The amount of group life insurance written in Illinois previous to 1918 by other companies was negligible. It is evident therefore that it is only recently, during an abnormal state of the labor market and at a time marked by the spirit of cooperation, that much interest has been manifested in group in- surance, and that the most recent data available, though they indicate marked progress, show that the amount written is still small as compared to insurance written on industrial or other individual policies. Group life insurance is sold to the employer, not to his employees. Moreover, while the employees have elsewhere not infrequently paid a share of the premium, the reports from five companies referred to above indicate that under all of the contracts written by them in Illinois in 1917 the entire premium was paid by the employer. Detailed statements received from twenty-four employers carrying group policies were to the effect that no part of the premiums was collected from the employees. It is safe to assume, therefore, that there are few, if any, establish- ments in Illinois where employees contribute money to the payment of premiums on group life insurance. The employers assume the entire burden because the premium usually amounts to only $1 or less per month per man, because any division of the cost is likely to provoke trouble whether the participation in the plan is optional or compulsory on the part of the employees, and because any division of the cost is likely to defeat one of the ends in view — expression of appreciation by the employer and the development of industrial good-will. Correspondence and conferences with employers carrying group policies and with others who have it under consideration (and a very considerable number are studying it carefully) indicate that they as a group have at least a three-fold interest in this insurance. All are found 23 According to an official of The Travelers Insurance Company the number of employees now (March 1, 1919), covered by group policies is approximately 75,000, or three times the number December 31, 1917. 138 in other welfare plans. One of these, and very important, is the humani- tarian interest which causes them to desire that the employee's dependents shall be provided for in the event of his death. The employers appre- ciate, as every one must, the value of life insurance; they feel that too little is being carried ; they know that many of their employees have no insurance or only the usual industrial or fraternal policy ; they may feel that their employees cannot well afford to carry a desirable amount of insurance in view of the more immediate demands upon their incomes. Again, they may feel that they "owe" their employees, or a part of them, something more than wages paid at the current rate. This is a way of meeting the obligation felt in a manner appreciated by the employees. Another motive is to develop good will on the part of their employees, to attract a better class of applicants for w^ork, and, more especially, to retain desirable men in their employment and thus reduce the turnover of labor which involves considerable direct and indirect expense. Many hope that it will be worth more than it costs. It is altogether possible that, looking on beyond, they hope group insurance, as well as other wel- fare plans which may be combined with it, will assist both in preventing an organization of labor with its demands for higher wages and shorter v hours, and in handling strikes. No evidence of the presence of any such desire has been secured. It may not be out of point to state, how- ever, that the employers showing interest in group insurance and other welfare plans, with few exceptions, conduct "open shop" establishments. But, it must be added, union men look with suspicion upon most if not all welfare plans, so that their employers would naturally be less interested than others in group insurance. As stated, many employers hope that group insurance will pay for itself. The cost varies not only w^th age, race, working conditions and the like, but also with the amount of insurance per employee. The raies quoted vary between less than one per cent net to about one and a quarter per cent of the pay-roll w^hen the amount of insurance is one year's wages, but most frequently, it is near one per cent. It would appear, however, that there are variations from the rates usually quoted because with group insurance being actively "pushed" the competition in respect to rates as well as in respect to the terms of the policy is very keen. In any event the premium is considerably smaller than on in- dividual policies for the cost of acquisition, accounting and management are very much reduced. The men are insured wholesale; it is not necessary to visit prospects in their homes or elsewhere. Moreover, the insurance is usually sold by the main office, not through a local agent who must have a commission. High officials in one of the leading com- panies have stated that it costs from 7 to 10 per cent of the premium to write a group policy as against 35 or more to write individual industrial policies. In this connection it must, of course, be held in mind that the amount of insurance per man is less on industrial than under the group policies. The group insurance policies issued in Illinois have been shaped by the ends employers have in view. In some cases, as has been stated above, only salaried employees are insured; those newly added to the 139 pay-roll are generally excluded and in some cases only those who have been employed for three months, or six months, or a year are placed on the insured list. In about three cases in four where the details of policies are known, the amount of insurance increases with the period of service. This is because such men are regarded as more valuable to the film or it is felt that the firm "owes them more." The amount of insurance is usually a substantial sum, as tested by the amounts wage- earners carry. The average per man of the insurance in effect in Illinois December 31, 1917, though most of it had recently been issued, was a little more than $800. It may begin at $150, $250, or $300 or, more likely, $500, and in some cases it begins at $1,000. Additions with period of service may double or treble the amount in the course of six or seven years. Less frequently it is a flat and invariable sum, say $500 or $1,000, per man. Or it may be, and not infrequently is, a year's wages, with or without a maximum operative only in the case of high- salaried employees. It goes without saying that life insurance, averaging, perhaps, one j^ear's wages, is distinctly worth the while to the beneficiaries. It pays the cost of the last sickness and burial and usually leaves a substantial sum to cover the period of necessary readjustment. Nevertheless, group insurance has met with strong opposition, not only from insurance com- missioners and many insurance companies who in the past have been doubtful of the wisdom of eliminating medical examination in any case, but also from others. The fraternal orders have shown considerable opposition to it, no doubt in part because it competes with their own insurance. One of their representatives has said at the Commission's hearings that it frequently causes the workmen to cancel other insurance they carry or to fail to "take out" the insurance they otherwise would; and then to find themselves without needed insurance when discharged or quitting, when perhaps they cannot pass the necessary medical examin- ation or have become too old to secure insurance on acceptable terms. It was asserted, moreover, that the cost, and more, was after all borne by the workmen in the lower wages they receive. xA.nd, again, it was pointed out that the employer may discontinue the insurance at will. Organized labor is opposed to group insurance and for the same reasons that it is opposed to employers' welfare plans in general. In addition to such objections as those mentioned above it is asserted that it "ties a man to the job" and is aimed or tends to prevent the organi- zation of labor or to weaken it and defeat its economic ends — higher wages, shorter hours and better working conditions. And, again, it is said that it will place a premium on the physical examination of workmen and the rejection or possibly the discharge of the less desirable risks among them so as to keep the premium down to a minimum. The time has not come to pass judgment upon group life insurance in the light of evidence furnished by experience. The experience has been brief and limited practically to a period marked by a labor shortage and by rising wages even in the absence of organization. Most employers who have experimented with it are unable to say how much effect it should have on the turnover of labor and the development of good will 140 on the part of their employees. There can be no doubt that it has been provided in addition to wages as currently paid. Whether it would prove to be a substitute for higher wages and better conditions in the long run and if more general cannot be answered in the light of estab- lished fact. Group hmlth and accident inswrancp,. — "Group health and accident insurance" is a new name for what was formerly called "workmen's collective insurance." Under the older name it dates back perhaps thirty years in the United States and to 1882 in England. In the older practice a "blanket" policy was issued to an employer covering only occupational or occupational and non-occupational accidents to his em- ployees. This kind of insurance made little headway in this country because of union opposition, the comparatively high premiums charged for it, and the enactment of workmen's compensation laws before it became well known./ In Illinois little of it seems to have been written, but a few thousand dollars is still collected each year a? premiums on policies bearing that name. Perhaps the Aetna Company was one of the first to write health insurance on the group plan for as early as 1898 it was issuing combined health and accident contracts under the old name. Though originating 20 years or more ago and though its merits are urged upon the attention of those who may be interested, group health and accident insurance is written in the United States neither extensively nor in a standardized form. A well-informed insurance man special- izing in this branch of insurance states in a letter to the Commission that perhaps not more than $500,000 a year is collected in premiums on the group insurance (under the new name) in force. Three of the six companies reporting to the Commission that they wrote group life in- surance in Illinois, stated that they also issue group health and accident policies but only one of these had (in 1918) issued any in this State. In addition to these companies, a number of casualty companies are prepared to write such policies, but some of them still have their first policy to write. yMost of the contracts are written on forms specially drawn, not on standard forms in general use. Group health and accident insurance is still in the experimental stage, and among insurance men will be found those who have doubt as to its eventual success^ They fear that the problem of simulation and malingering will be difficult to meet, y Inasmuch as so-called standard forms developed are not widely used, it is difficult to describe group health and accident insurance accurately. From the data available, however, it may be said to incorporate pretty much the same standards as the individual policies issued by casualty companies. The policy will cover certain risks, perhaps with a 7 day waiting period and a 26 weeks or a 52 weeks maximum in the given case. It may be said, also, that being shaped pretty much by the wishes of the employer, its provisions are similar to those developed for establishment funds organized by the employer. The weekly benefit may be*a fraction of wages, most likely fifty per cent, or it may be a lump sum. Provision may or may not be made for medical attention. 141 Obviously it is impossible to state what percentage the premium foi- group health and accident insurance is of the pay-roll. It varies with the hazard and. the provisions incorporated in the contract. This in- surance is, however, considerably cheaper than that written on individual policies. The accounting and collection expense is reduced, and instead of the large commission paid agents as set forth above the commissions being paid vary from 7 to 10 per cent of the premiums. Obviously with equally good administration the cost would be somewhat larger than the cost under an establishment fund arrangement making the same provision in benefits. The cost of this insurance may be paid by the employer, or by the employees, or be divided between them. The advantages of health and accident insurance are great. When written on these group policies it is open to much the same criticism as group life insurance except that the tendency "to tie the employee to his ' job" is not so strong. Perhaps all that needs to be said is that it amounts to an establishment fund arrangement with an outside carrier and with this carrier and the employer, with little expression of preference on the part of the insured, determining the standards which shall be incor- porated in the contract. Possibly the question should be raised as to what it offers besides the assumption of the risk under the contract and the advertising by the carrier that will induce employers to make use of it rather than develop establishment funds. It does, however, com- bine the risks for the several firms for which contracts are written, it advertises health insurance, and provides a method of insurance for groups of sufficient size, i. e. 50, the minimum usually accepted. (9) Insurance as Found Among Wage-earners in Chicago. In addition to that secured from establishment funds, unions, fraternal orders, foreign societies, and insurance companies of various kinds, the Commission secured information relating to insurance from the families selected for study in Chicago. Of course the insurance situation differs greatly from one locality to another; hence the data secured in Chicago cannot be accepted as representative in all respects, but chiefl}^ in respect to the number of w^age-earners who are insured against loss of income due to disabling sickness. In most respects the data are probably fairly representative and are of value in indicating certain things not brought out in the above summary. First of all it should be said that in some cases the informant, most frequently the wife, did not know whether or not the husband had dis- ability insurance especially if it was provided by the establishment in which he was emplo3^ed. Moreover, in a considerable number of cases the informant's knowledge of insurance carried did not extend to the rate of benefit per week. Where there had been sickness, however, the in- formation desired was usually obtained fully and accurately. The following summary of details relating to disability insurance must be used with the limitations indicated. The families studied in the blocks selected as typical in Chicago contained 4,801 members who were gainfully occupied and for whom desired information was obtained — 4,456 as wage-earners and 345 on 142 their own account. Of the wage-earners 1,055 or 23,7 per cent were found to be insured against sickness or against sickness and accident. The corresponding figure for the smaller number working on their own account was 89 or 25.8 per cent. Of the 1,055 wage-earners insured, 978 reported 1,126 policies (or membership rights), for a considerable num- ber were insured in two, and a few in three organizations. Of the 1,055, 107 were insured for less than $5 per week; 688, for $5 but less than $10 (usually $5 or $7) ; 138, for $10 but less than $15 (most frequently $10) ; and 45, for $15 or over. Fairly complete information was secured where a wage-earner had been sick. The following table shows a number of significant things. Economic status. Number of wage- earners. Number losing wages for more than 1 week. Per cent wage- earners losing wages. Number paid sick benefits. Per cent of sick paid benefits. Average wage loss per man. Average benefit received. Per cent of benefit of wage loss. A 2,770 937 373 4,474 563 223 108 937 24.8 23.8 29.0 20.9 89 27 8 126 15.8 12.1 7.4 13.4 $119. 35 101. 93 141. 64 118. 76 $56.60 43.96 22.00 52.44 47.4 B 43.1 C 15.5 All* 44.1 * Includes wagre-earners in addition to these classed "A," "B" and "C." The significant facts shown by this table are: (1) That 20.9 per, cent of the 4,474 wage-earners lost wages for more than one week in the course of the year^ and that only 13.4 per cent of these received sick benefits ; (2) That the average wage loss was $118.76, and that the average benefit received was $52.44 or 44.1 per cent of the amount lost; (3) That, taking the group as a whole, the disability insurance re- ceived was less than 6 per cent of the wages lost because of disabilities lasting more than a week; (4) That the wage-earners in Class "C" (in the poverty class), less able to bear the financial loss connected with disabling sickness than those in Class B (with meager incomes) and in Class A (with moderate incomes), experienced the greatest amount of sickness and sustained the largest average loss of wages ; and (5) That, as has been frequently stated, those in the most insecure economic position had the smallest number insured and received in benefits the smallest percentage of wages lost. Of course the number of wage-earners included in the study is small. Yet they tend to confirm the conclusion that those most in need of dis- ability insurance are least well provided with it. In the table presented above all wage-earners in the families studied are included. In the table following data are presented for wage-earning husbands charged with family responsibilities, these being grouped by "economic status" — those with moderate incomes (A), those with meager incomes (B), and those with poverty incomes (C). 143 Economic status of husbands. Number. Number insured. Per cent insured. Number reporting amount of insurance. Average amount of insurance per week. A... B... C... All* 1,475 565 38.3 517 559 219 39.2 212 215 52 24.2 50 2,315 850 36.7 788 $7.37 6.46 5.58 6.98 * Includes 66 husbands not classed as A, B or C. This table shows the following significant facts: (1) That while the relative number of these "main bread-winners" insured was larger than that of all wage-earners (23.7 per cent as shown above), only 36.7 per cent had health insurance; (2) That the heads of families with smallest incomes as compared to needs, whose incomes could least well be sacrificed, were least fre- quently insured; and (3) That the average benefit (from one or more policies) was a little less than $7.00 per week, which is not more than a third of their wages as shown by the fact that 2,203 of them earned $2,226,904 or an average of $1,010. 8-5 each during the year in spite of considerable lost time. Turning to life insurance and funeral benefits, it was found that 7,193 or 57.8 per cent of the persons in the wage-earning and non-wage- earning families studied were insured in larger or smaller sums, the aver- age value of the 7,721 policies being $419.24. Of husbands, 74.8 were in- sured; of wives 58.8 per cent; of males over 14, other than husbands, 56.5 per cent; of females over 14, other than wives, 53.6 per cent; of children under 14, 48.8 per cent. The average values of the policies were $758, $474, $423, $307, and $101 for the five groups respectively. Noteworthy differences were found among the several nationalities, but one or more members in a majority of families had life insurance. The smallest percentage (57.8) of families with one or more mem- bers insured w^as found among the Italians; the largest (93.8) among the colored. There were marked differences, also, in the value of policies carried by the members of the several races. More important, however, was the relation found betw^een "economic status" and the amount of life insurance carried. As with disability insurance, so with life insurance was it found that the largest number of families without insurance and the smallest policies were among those with smallest in- comes as compared to needs. Of the "A" families, one or more members of 84.5 per cent of the total number had insurance ; of the "B" families, 85.1 per cent; of the "C" families, 73.2 per cent. Taking the total number of members in the families grouped into the three classes, 60.8 per cent of the first (A), 60.1 per cent of the second (B), and 50.7 per cent of the third (C) were insured. The average number of policies per policyholder in the first class was 1.08, in the second 1.05, and in the third 1.04. Taking the average values of the policies for three classes, they are found to be $467.34, $319.12 and $288.74, respectively. This means that the average amount of insurance per policyholder was approximately $505 in Class A, $335 in Class B, and $300 in Class C. 144 The life insurance carried by male heads of wage-earning families is of special interest. Of a total of 2,417, 1,865 or 77.2 per cent were insured. The total number of policies carried was 2,167; the value of 1,908 of these was $1,396,673 or an average of $732 each. In other words, 77.2 per cent of the male heads of families were insured for an average of approximately $850. Here, again, noteworthy contrasts were found as between the three economic groups. Of the male heads of 1,220 families with moderate incomes, 78.8 were insured for an average of approximately $854 each; of the male heads of 436 with meager incomes, 76.2 per cent, for an average of $765; of the male heads of 147 families with poverty in- comes, 68.4 per cent, for an average of $742. The number of policies and amount of insurance in insurance organ- izations of different kinds has been tabulated for male heads of wage- earning families only. The number of "ordinary policies" was 206, the amount $269,700; of "industrial policies," 578, the amount $286,605; of fraternal policies, 952, the amount $743,819 ; of union membership cer- tificates, 115, the amount $69,048; of other policies (in foreign benefit societies, etc.), 57, the amount $27,501. Thus almost half of the policies reported (952 of 1,908) and more than half of the insurance ($743,819 of $1,386,673) were in fraternal orders. This is not true of other members of these families. Nearly all of the insurance of children, for example, is "industrial." (10) The Existing Health Insurance Summarized. The summaries of the insurance activities of organizations of several different kinds presented above are designed to show the existing in- surance situation among wage-earners and their families in Illinois. Because they are summaries some needed qualifications and explanations may have been omitted. As stated above, more complete and more ade- quate reports on establishment funds, union benefit systems, insurance by fraternal organizations, provision made by foreign benefit societies, in- surance by casualty companies and assessment associations, industrial in- surance, and group life and disability insurance will be found in special studies printed in Part II of this report. ^^ In concluding this summary of facts the existing insurance situation may be stated in the fewest words. This may be prefaced by the remark that the number and greatest variety of existing institutions providing sickness and accident benefits and life insurance and funeral bene- fits evidence an appreciation of the problems connected with sickness, accident, and death, and the applicability of the principle of insurance to them in partially indemnifying the losses sustained. Our investigations show, first of all, that the majority of wage- earners, and especially of those who are heads of families, are provided with life insurance or with funeral benefits. More than three-quarters of the male heads of wage-earning families studied in Chicago had such 2« Inasmuch as the provision made for many public employees through existing pension funds has been under investigation by the Pension Laws Commission, no investigation of it was made by this Commission and only incidental reference is made to it in this report. For the results of this investigation made by the Pension Laws Commission see its forthcoming report. 145 provision, and there is reason to believe that these wage-earners are fairly typical of those of the State as a whole. Dependent members of Rvage-earning families are only less extensively insured for smaller amounts. Much of the life insurance carried by wage-earners, and especially by heads of families, is sufficient not only to cover funeral costs and the expenses of last illness, but also to leave something to defray necessary family expenses during the period of readjustment after the bread- winner's death. This is true of most of the life insurance provided by the fraternal orders (the greatest carriers) ; of nearly all of the group insurance being provided by rapidly increasing, but not as yet large, number of employers; of some of that provided by employers as a part of their welfare plans; and of a small part of the union insurance.' ^loreover, it would appear that a considerable percentage of the heads of families have ordinary life insurance policies with life insurance com-- panics. On the other hand, most of the insurance provided by unions, by establishment funds, by "foreign societies," and by companies writing industrial insurance, and a considerable part of that provided by frater- nal societies is intended to serve as a funeral benefit and, perhaps, to cover a part or all of the expenses incidental to the last illness. If we may asume the need of at least enough insurance to con- stitute a funeral benefit, the first defect in the existing insurance lies in the fact that a considerable number of wage-earners have none. The carrying of insurance being voluntary with comparatively few exceptions, some have not sought it; a smaller number have not been able to secure it, for, naturally enough, the carriers, with few exceptions, select their, risks; others because of financial strain or for other reason have per- mitted their insurance to lapse by non-payment of premiums or by the discontinuance of membership in an organization providing insurance for its members. Directly connected with this last consideration, it should be noted that almost always group insurance and that provided by establishment funds and by employers as a part of their welfare plans ceases with discontinuance of employment with the given firm or in the establishment. There is, as would be expected, more or less criticism of such insurance on the ground that "it ties a man to his job.'' Most of the insurance and funeral benefits are provided by mutual organizations. Only the industrial insurance wTitten on individual policies, very extensively employed to cover funeral costs, especially in the case of women and children, is criticized on the ground that it is relatively expensive. The premiums on industrial insurance (on in- dividual policies) are necessarily high because of the high cost of placing the insurance and of making the weekly collections. Because of these expenses the total of payments and sums credited to the policy- holders of the three largest companies writing industrial insurance had been only 61.9 per cent of the premiums collected and the income secured from the funds invested, from the beginning of business to December 31, 1915. Finally, whether or not it is to be regarded as a defect, it may be pointed out that with the exception of group insurance, that provided —10 H I 146 by employers, and some of that provided by establishment funds — a com- paratively small part of the whole — the entire cost of the insurance carried is borne by the insured.- Among wage-earners, sickness or health insurance, though more and more extensively prpvided, is much less frequently found than life in- surance and funeral benefits. As against all manual wage-earners and all other employed persons earning less than 160 pounds per year in Great Britain and nearly all wage-earners in Germany provided with sickness insurance under the compulsory laws in effect, perhaps 30 per cent of the wage-earners in Illinois have such insurance on a voluntary basis with one or more organizations of some kind or other. Important among these organizations are fraternal benefit societies, the casualty companies and assessment associations, unions, establishment funds, and foreign benefit societies. The estimate that "perhaps 30 per cent of the wage-earners of Illi- nois" have insurance against disabling sickness is a rough one. The possible errors entering into the making of any estimate are numerous. In the first place, it is possible to estimate the number of wage-earners only approximately — at 1,850,000. In the second place and more im- portant, the possible error in the estimated number of the wage-earning group insured through organizations of different kinds is large. Be- cause of the interstate employment of railway and certain other em- ployees, several incomplete reports, and a number of funds not studied, the estimated number insured through establishment funds must be set down as between the wide limits of 97,500 and 130,000. The number insured through union funds can be estimated more accurately at between 135,000 and 145,000. Estimates of from 250,000 to 300^000 and of 35,000 for fraternal benefit societies and independent foreign societies respectively are roughly made. The estimate of 100,000 for casualty companies and 40,000 for assessment companies are "outside figures.^' No estimate is ventured as to the number insured in church clubs for these were not studied except in the most incidental way. A further source of difficulty is found in the fact that a considerable number of the members of wage-earning families insured, except in establishment and union funds, are not themselves wage-earners but dependent wives or others. Perhaps any total arrived at by adding the number of insured through organizations of different kinds would have to be reduced by 50,000 because of this fact. And, finally, a further reduction would have to be made because some wage-earners are insured in two or more organizations. Just how large a reduction would be required is un- known. Our investigations of families in Chicago show that the total of membership certificates and policies exceeds the number of wage- earners insured against disabling sickness by approximately 15 per cent, some insurance men, however, have ventured the opinion that the number of certificates of membership in funds and policies would have to be reduced by a third to ascertain the number of persons insured. Of course some of the possible errors could have been diminished by more extended investigation. More extended investigations were not made to arrive at the most accurate general estimate because a difference of 147 even 5 per cent is of little importance when it is clear tliat ©nly a minority are insured against sickness. It would appear that because of the more frequent membership in societies that provide sickness benefits and because of the greater responsi- bility resting upon them, the main breadwinners are more frequently insured against loss of time caused by sickness and accident than are other wage-earners. With this important exception, there is reason to believe that those most in need of health insurance least frequently have it. There are a number of reasons why sickness insurance is less ex- tensively found than life insurance and death benefits. One of these is that the organized business of health insurance has developed more recently than the organized life insurance business. It has not been so frequently called to the attention of prospects and advertised. An- other is that the risk of sickness does not make such strong appeal as the risk of death. A third reason is found in the administrative diffi- culties which have been experienced in providing such insurance. The organizations which because of simulation or malingering, have dis- continued or limited their writing of health insurance are by no means few. A fourth reason is found in the fact that except in the majority of establishment funds and a few other instances, the entire cost has been borne by the insured, and when the cost is undivided, the necessary premiums are heavy. For example, many labor organizations have regarded the cost as prohibitive i. e. their memebrs regard necessary dues as too heavy. A fifth reason is found in the fact that most organizations providing loss of time indemnities or sickness benefits have had and have restrictive rules designed to protect their funds against those whose insurance would involve greatest risk. And, finally, most of the in- surance has provided rather meager benefits and these usually have been limited to a comparatively short period — most frequently to 13 weeks in the year, with the result that it has been less attractive than it would have been with more ample benefits. Most wage-earners have never had sickness insurance ; many of those who have had it have left the union, or the establishment, or the society providing it, or have failed to renew their policies by paying the premiums when due. The existing insurance varies greatly from one institution to an- other. The outstanding fact is that while better standards are being developed, it has not become standardized. Most frequently it provides only cash benefits for loss of time.' In some instances, though they are the exception and not the rule, the waiting period is in excess of a week and may be regarded as unduly long. Much more important are tlie limitations on the period which may be covered by claims of the insured. Though there are numerous exceptions, most frequently the maximum period is 13 weeks in the year. Where the maximum is only 13 weeks or less, the provision falls short of good standards for a considerable number of cases are of much longer duration and they involve the greatest financial strain. Just as important is the fact that while there are ex- ceptions, the benefits paid are usually inadequate sums. They average less than $7 per week and less than 50 per cent of wages. Equally im- 148 portant, from a social point of view, are the restrictive rules which pre- vent many from securing insurance. Most of the existing insurance against sickness is provided by mutual organizations democratically governed. Yet there are some exceptions to this where compulsion and pressure are exercised by private insti- tutions. Except in the case of establishment funds (and here there are ex- ceptions) and under the little group insurance provided by employers, the entire cost is borne by the insured. The public makes no contribution and the contributions made by industry are comparatively small when all cases are considered collectively. For the most part the cost of adminis- tration is not heavy; most of the money contributed in dues and assess- ments by the insured is returned in benefits to the disabled. The chief exception found is where individual policies are issued by insurance companies. The casualty companies, largely because of the great cost of writing policies and collecting the premiums, have paid out in the settle- ment of claims in Illinois less than 42 cents on the dollar collected in premiums. A number of the companies are now prepared to write group policies which would greatly reduce the cost of acquisition, but little group sickness insurance has been written by these companies and it is still in the experimental stage. The existing health insurance is chiefly for the partial compensation of wage losses. In few cases are maternity benefits provided. Provision for medical care, nursing and hospital treatment are infrequently made. Much more important than that which is provided by the various in- surance institutions is the provision being made by an increasing number of the leading employers through the development of their welfare and medical departments. To this summary statement two facts- should be added. While organized labor has been divided on the question of compulsory health insurance, it has been adversely critical of such insurance of working- men as is not provided by mutual organizations. The new Independent Labor Party has inserted in its platform as a part of the eighth of its "fourteen points'' a demand for "the establishment of governmental insurance against accident and illness." 149 CHAPTER V. THE COMMISSION'S FINDINGS, CONCLU- SIONS AND RECOMMENDATIONS. The Commission has given consideration to five main questions, viz: (1) What is the problem presented by sickness and death? (2) ^^^lat is being done in Illinois to control and prevent disease and to conserve health? (3) What is being done to care for the sick and the physically disabled? (4) What is being done to compensate for loss of earnings and to meet the bills caused by sickness and death? And, (5) What more, if anything, can and should be done to meet the situation as found by investigation ? The Commission's investigations have been carried on under the able direction of its Secretary in strict adherence to the policy outlined at the organization of the Commission, namely, that the investigations shall be as thorough as the limitations of time and money will permit with the single purpose of ascertaining the facts and with a strict regard to scientific accuracy regardless of what theory may be supported by them, and that not until the investigation shall be completed, the facts assembled and the completed data available, shall consideration be given by the Commission to the formulation of any conclusion or recommendation. Knowing the thoroughness, the singleness of purpose, and the manner in which the investigations were carried on, the Commission has the utmost confidence in basing its findings, conclusions and recommendations upon the results in so far as they cover the m.any phases of the problems under consideration by the Commission. To the local investigations made by the agents of the Commission under the Secretary's supervision have been added concise reports on compulsory health insurance in Great Britain and Germany and on the compulsory health insurance movement in the United States. These have been prepared by scholars selected as well qualified for the tasks. The results of the several investigations have been set out in necessary detail in the four chapters presented above by the Secretary and in the special reports which follow. In this Chapter the Commission presents its conclusions and its recommendations as to legislation needed to meet the situation as found by the investigation. The statute creating the. Commission limited its investigations to wage-earners and their families. With the population of the State, July 1, 1918 estimated by the Federal census at approximately 6,,300,000, and the proportion of these gainfully occupied who were employed as wage- earners in 1910 shown to be in excess of 29 per cent of the whole, the number of wage-earners in Illinois on July 1, 1918 is estimated at 1,850,000, and their dependents at something over 2,700,000. Accord- ingly the group embraced within the investigations required of the Com- mission may he estimated a^^fiOO,000 or more than seven-tenths of the entire population. It is apparent, therefore, speaking broadly, that what- ever affects the wage-earners and their families, is of concern to the people as a whole; and wiiatever affects the people as a whole affects the wage-earners and their families. It is evident, moreover, that where data are not available for that portion of the community comprised within the group of wage-earners and their families, data available for the entire community should have a considerable probative value. 1. The Pi'ohlem of sickness and Non-industrial Accident — Stated. The problem of sickness has been set out in terms of the number disabled by sickness, . the number ill and perhaps in need of medical treatment though not disabled, the duration and cost of sickness, changes in standards of living, poverty, and dependency. (a) The Number III at a Given Time. Seven investigations made by the Metropolitan Life Insurance Com- pany in as man}' communities show that 1.83 per cent of the 633,856 persons canvassed were unable to work because of sickness or non-in- dustrial accident on the days the enquiries were made. This percentage shows the number who may be expected to be disabled at a given time by reason of sickness or accident for following their ordinary pursuits. This, however, does not show the number who have disabilities which may impair efficiency and which may call for treatment. Medical ex- aminations made of 4,573 persons at Framingham, Massachusetts, showed that 25 per cent had what were classed by the examining physicians as "serious affections." Approximately 35 per cent of the 2,510,706 young men examined in the first draft were rejected as not meeting army standards. Returns of the results of the physical examinations of 69,171 applicants for work in Illinois shoAV that about the same percentage (33.1) were found to be diseased or defective and that 19 per cent of the 69,171 were rejected as not physically suitable for the work applied for. In all of the above cases it is disclosed that many of the affections, diseases or defects had existed since childhood. It therefore need occasion no surprise to find that 37,356 or 47.1 per cent of 79,383 Chicago school children examined in 1915 were found to be diseased or physically defective and that 32,860 of them were advised to secure treatment. Investigation has shown that the number of diseased and defective children is likely to be larger in rural communities than in such urban communities as Chicago. In connection with these facts it should be 'said that the percentage of rejections because of failure to meet a physical standard required for army service or some fonns of industrial work is not the percentage physically unfit for work of some other kind. The character of the service in connection with which a standard is established is always an important consideration. For example, many of those rejected in the first draft for failure to meet the standard required for active military service were nevertheless suitable for limited service and were later so classified and did carrv on duties connected with the armv org^anization which did not require the exacting physical demands of the active mili- 151 tary service. Xevertheless, it is safe to say that in addition to those disabled by sickness at any given time, between 20 and 30 per cent of all persons not so disabled may be expected to have disease or physical defects for which treatment would be beneficial. (b) Sickness Experience of a Year. Number sick. — In an effort to secure the most detailed information required for its purposes the Commission has had an investigation made of all families living in 41 blocks in Chicago, these being occupied chiefly by wage-earning families and carefully selected so as to be typical of the much larger number of wage-earning families in the City. These "Block Studies" covered 3,048 families with 12,450 members. It was found that 65.8 per cent of these families had one or more cases of serious illness during the twelve months ending with the date of the visit made by the investigators. "Serious illness" was defined so as to include all cases of disability for work or school for a week or more caused by sickness or non-industrial accident, all cases of serious chronic affections, such as tuberculosis, regardless of whether or not they caused such disability at any time for as much as a week, and serious affections, such as of the tonsils, of shorter duration provided a doctor or surgeon was secured to give needed treatment. Of the 2,708 wage-earning fami- lies in these blocks, 66.5 per cent had one or more cases of serious illness as thus defined. In 57.4 per cent, or more than half of the 1,802 wage- earning families with sickness one or more wage-earners had been seriously ill. Of the entire number of wage-earners 27.3 per cent had been ill and (counting only losses of a duration of a week or more) 20.9 per cent of them had lost a week or more of work because of their disabilities. The relative number of non-wage-earners in these families reported as having been seriously ill was somewhat larger — 28.3 per cent. An examination has been made of the records of a large number of mutual benefit associations of different types. Nine of these, covering the experience of 663,163 wage-earners, showed that 19.9 per cent of them were compensated in the course of a year for disabilities lasting for a week or more at a time, with an average period of disability of 27.4 days per case. Combining results obtained, it is probable that 20 per cent of all wage-earners Avill be disabled for more than 7 days in the! course of a year by a sickness or non-industrial accident, with an average of between 27 and 29 days for each wage-earner disabled. All disabling sickness of one day or more spread over the entire group would indicate an average loss of working time of between 8 and 9 days for each wage- earner. Duration of disability. — ^This average is, however, of limited value in stating the problem of sickness among wage-earners for the duration of the disability varies greatly from one case to another. The data collected and set out in detail elsewhere (in Special Eeport II, Part II) indicate that of each 100 disabled for more than a week, 65 will be dis- abled for less than 4 weeks, 19 for from 4 to 8 weeks, 7 for from 8 to 12 weeks, 6 for from 12 to 27 weeks, 3 for more than 6 months, and 1.29 for more than a year. Put in terms of lost wages, the investigations 152 made in Chicago show that 56.1 per cent of those losing wagesynosl less than 10 per cent and 76.2 per cent less than 20 per cent of what their annual earnings would have been had they not been reduced by dis- abling sickness. Expressed in the other way, it was found that of those who lost wages (which constituted one-fifth of the entire group) 43.9 per cent lost 10 per cent or more and 23.8 per cent lost 20 i^r cent or more of what their earnings would have been. Expressed in terms of the wage-earning group, it is indicated that 20 per cent will be disabled for more than one week, 13 per cent for more than one week and less than four weeks, 7 per cent for four weeks or more, 3.2 per cent for eight weeks or more, 1.8 per cent for twelve weeks or more, .6 per cent for more than six months; that of the entire group of wage-earners it may be ex- pected that 8.8 per cent will lose 10 per cent or more and 4.8 per cent will lose 20 per cent or more of what their earnings would have been but for disabling sickness. Cost of sickness. — In the investigation of wage-earning families in the residence blocks selected in Chicago, an effort was made to ascertain the money cost of sickness. The average wage loss of wage-earners dis- abled for a week or more at a time was found to have been $119 and 13.7 per cent of what their earnings would have been but for the disability. Spread over the 4,474 wage-earners in these families this represents an average loss of $24.95 per man and 3.33 per cent of his earnings for these averaged $750.37 for the year. To each dollar of lost wages it was found that approximately 25 cents must be added for medical bills paid. Of course the wage-earners bear the medical bills of their de- pendents also. This same investigation showed that for each wage- earning family in which there had been illness of the types recorded, the average cost for the year in wages lost at the time of disabling sickness and in medical bills paid was $97.98. Taking these losses and outlays and the medical bills paid where there was no serious illness, the cost in wages lost and medical outlays was found to approach $75 per family per year. This is more than 5.8 per cent of their incomes from all sources, for these were found to average $1,298 per family. If these figures can be applied to the entire State, it would mean that the cost of disabling sickness of wage-earners alone in Illinois would be about $57,000,000. If to this is added the medical bills paid for their de- pendents the cost of sickness in the wage-earning families of the State would be between $80,000,000 and $86,000,000 per year. Changes in standards of living due to sickness. — Any estimate arrived at in the manner here emploved, does not, of course, show the entire cost of sickness among wage-earners and their families. There may be losses because of reduced wages due to impaired efficiency; cer- tainly not all of the cost of treatment is paid for. In the family in- vestigations to which several references have already been made, it was found that in 14.3 per cent of the families with sickness (or 16 per cent of those with medical attention) the physician's services, in 7 per cent (or 57 per cent of those with nursing care) the nurses' services, in 10.5 per cent (or 50 per cent of those who received hospital care) the hospital facilities, in 19.3 per cent (or 60 per cent of those visiting dis- 153 pensaries) the dispensary treatment, in 4 per cent the medicines supplied had been without charge; These percentages, it should be added, do not include the free services of physicians at dispensaries or the nursing incidental to free hospital service, or the medicine in some ca^es supplied by the dispensary or the physician where no charge was made for treat- ment. It should be said, moreover, that where fees were paid for dis- pensary service these usually covered only a fraction of the cost. It is evident that no small part of the cost of sickness among wage-earners and their families is borne not by them but by the doctors, the nurses, the dispensaries, or by others. Our investigation of families shows that in a considerable percentage of cases the wife or others who had not been gainfully occupied sought emploj^ment to meet the emergency presented by sickness of those losing working time. It shows, also, that in spite of this, of added economy, and of other things involving a change in standards of living, 16.6 per cent of the wage-earning families with sickness had deficits for the year. That these deficits were largely due to sickness is indicated by the fact •that only 4.7 per cent of the families without sickness had deficits. In covering deficits sustained some had used savings, others had secured material relief from charitable agencies, had secured loans, or had used insurance received, while still others left bills unpaid. Material relief in the form of charity was received by 2.4 per cent of the families in which there had been sickness, or 1.8 per cent of the entire number of the families investigated. (c) Poverty and Dependency Eesidting from Sickness. The Commission was especially interested in ascertaining the ex- tent to which sickness and non-industrial accidents are responsible for poverty and dependency. If poverty is defined in terms of a family income too small to meet the test of a conservative subsistence budget, our investigations of families in the 41 Chicago blocks show that sickness was responsible for about one-fourth (25.3 per cent) of the 375 cases found in the grand total of 2,589 wage-earning families for which com- plete data in respect to incomes were obtained. In the investigation of the relation between sickness and non-in- dustrial accident and dependency, a study was made of the records of a number of charity organizations in the smaller cities of the State, and of three charitable agencies in Chicago — the former for the last fiscal year, the latter for a period of eight 3^ears. Sickness was found to have been a cause or an accompanying condition of dependency in from a third to half of the cases. Moreover, this study and the investigation of 628 families in receipt of material relief from Chicago agencies indicated that from 40 to 50 per cent of the cases where sickness was a cause or condition of dependency, the disability was due to tuberculosis or other chronic diseases — tuberculosis and other chronic diseases sharing about an equal degree of responsibility. The special problem of tuberculosis is discussed below. (d) A summary. — The above is presented as a summary statement of the more important facts bearing upon the problem of sickness as dis- 154 closed by our investigations. In a sentence we find: (1) that somewhat less than 2 per cent are disabled by sickness or accident at a given time ; (2) that the percentage not disabled but who have serious affections which may call for medical care is distinctly larger; (3) that approximatelv two-thirds of the wage-earning families will have one or more cases of' serious sickness or non-industrial accident in the course of the year; (4) that in something more than half of these families the illness will in- clude that of wage-earner; (5) that something more than a quarter of the wage-earners will be sick or sustain non-industrial accident in the course of the year and that about a fifth of the entire number will lose a week or more of employment because of the disability caused thereby; (6) that the loss of time by wage-earners will average between 8 and 9 days per year for each wage-earner in the entire group; (7) that the losses due to sickness and non-industrial accident are very unevenly dis- tributed among wage-earning families; (8) that the average loss in wages and medical bills connected with sickness and accident will approach $75 per year per family when spread over the entire group, amounting to 5% per cent or more of the average family income; (9) that the money cost» of sickness and non-industrial accident borne by the wage-earners of Illinois is probably between $80,000,000 and $86,000,000 per year; (10) that sickness and non-industrial accident are frequently accompanied by more or less important changes in the standard of living; (11) that they give rise to deficits in a substantial number of cases; (13) that in Chicago sickness and non-industrial accident would appear to be responsible for 25.3 per cent of the cases of poverty found in our investigations; (13) that sickness and non-industrial accident are found as a cause or as an accompanying condition of dependenc}^ in from a third to a half of the cases of dependency not giving rise to institutional care; and (14) that tuberculosis and other chronic diseases are each found in from 20 to 25 per cent of the cases where sickness is a cause or condition of dependency. 2. Illinois Vital Statistics. An examination has been made of the vital statistics of Illinois to secure such light as they might shed upon the problems which the Com- mission has had under investigation. Unfortunately the only reliable vital statistics for the State as a whole are those for the year 1917-18. These show that the general death rate (14.2 per 1,000) for the State as a whole corresponds closely to that for the entire registration area of the United States (14.0) as shown by the Census Mortality Statistics for 1916. This would indicate that there is nothing peculiar in the general problem of disease and fatal illness in Illinois. While acceptable data for the State covering a period of years are not available, there can be no doubt that in Illinois there has been a declining death rate, closely corresponding to that shown by the Census for the registration area. The reduction there shown is from 19.8 per thousand in 1880 to 14.0 per thousand in 1916. In Chicago where, fortunately, acceptable figures are available, the death rate decreased from 20.27 in 1887 to 14.92 in 1917. The seven other cities of the State which have been registration cities for a number of vears show in 155 general a similar decrease. The decrease in the rural communities of Illinois is not known, but the registration area as a whole shows that the decrease in the cities is greater than in the rural districts. In Chicago the period from 1887 to 1917 has witnessed a decrease in the death rates from typhoid, pulmonary tuberculosis, croup, diphtheria, scarlet fever, measles and whooping cough, but an increase in the death rates from pneumonia, cancer, Bright's disease, and heart disease. The improvement in the water, milk and food supplies and in sanitary con- ditions, a better understanding of matters affecting health, the control of communicable diseases, the advance in medical and surgical service and practice,- and the improvement in the hospital and other facilities for treatment and cure have all contributed to the reduction in the death rate. This is most marked in the reduction of deaths of children and has been not nearly so great in middle life. The death rate among persons past fifty years had increased. It is a question whether the increase in the death rate from degenerative diseases and of the age group past fifty years is to be explained by more accurate diagnosis and by the bringing to adult life of children of less than normal vitality who would have died in childhood but for the advance in disease control and treatment, thus increasing in the adult age groups the proportion of those with less than normal vitality, or whether the increase is indicative of a condition of modern life which can be corrected. While the general vital statistics available for Illinois show a favor- able result when compared with those for other cities and states, the data available for Chicago relating to deaths of children under 2 years of age from enteritis and diarrhea do not make a favorable showing. Tak- ing the death rates per 100,000 of total population in cities of 500,000 and over, the death rates from enteritis for Chicago have shown a tendency to increase since 1901 while in New York, St. Louis, Boston and some other cities they have been reduced materially. Xew York, for example, had an annual average for 1901 to 1905 of 145 deaths per 100,000, which was reduced to 58.1 in 1916. Chicago, on the other hand, had an incerase from 104.4 for 1901 to 1905 to 131 in 1914; 112.7 in 1915, and 141.4 in 1916. It would appear that considerable room for improvement is indicated by these figures for in 1916 the Chicago Health Department found that 3,450 or 40.9 per cent of the 8,421 deaths of children under 2 years of age were due to diarrhea and enteritis. 3. The Causes of and Responsibility for Disease. The cause of and responsibility for disease is here presented, not from a'medical viewpoint, but from a consideration of the claim that the community or State, industry and the individual are in varying pro- portions responsible for sickness and premature death. A case of typhoid may be traced to the failure of the municipality properly to control the purity of the water or milk supply ; but what of the typhoid cases otherwise caused? The failure of the public autliori- ties properly to control a contagious disease may contribute to its spread ; but what of the contagious cases caused by the insistence of the in- dividual upon his right of personal liberty and self-determination in 156 matters relating to disease and accepted medical treatment and control thereof ? A well-defined occupational disease may properly be considered as caused by the industry in which are employed those who suffer from the disease ; but what of the diseases which are commonly found in all with- out regard to occupation and which are not limited to those in a given occupation? Even though in a given employment, the incidence of dis- ease may be found in excess of the average for that disease among the people generally, and may indicate that there are conditions within the employment which are contributing to the disease, it is obvious that the responsibility of the particular establishment is not an index as to the responsibility of industry collectively. Assuming a working day of proper length for the normal worker, can it be properly said that exhaustion or resulting disability of the one unable to meet such standard is caused by the industry, and should it be held responsible unless each worker is examined to determine, if possible, whether he is physically suited for the job? In order to de- termine whether the worker is physically able to do the work which he would undertake, should industry be compelled in the interest of the worker to examine him physically before assignment to such work ? Un- less such examination is made with the right of control, is the industry to be held responsible for the result ? In our opinion nearly all disease is traceable in its ultimate caus- ation to the individual, to the violation, through lack of understanding or willfulness, of the well-recognized laws of health or hygiene; the re- fusal to use the facilities for correction of physical conditions which will become disabling; excesses in personal conduct; and a most im- portant factor, the inherent limitations of vitality which vary in indi- viduals from those merely able to keep alive the spark of life to those who are of the most robust ajid vigorous type. The foregoing is not intended as a complete statement of the causes of disease and responsibility therefor, but merely to illustrate what is indubitably the fact that causation or responsibilty for disease cannot be rationally assigned on the basis of a classification of diseases, with the possible exception of diseases to which workers in an occupation are ex- posed and which are not found among those who are not engaged in that occupation. Any statement of a proportional responsibility of the State, in- dustry or the individual as factors causing disease in the aggi'egate is without basis in ascertained fact or creditable evidence. 4. Health Legislation and Public Health Administration. ' The Commission has also given consideration to the effort which has been made to control disease and to conserve health. The State now has in effect much legislation designed to protect Health — the Gannent Law; the Blower Law; the Health, Safety and Comfort Law; the Occupational Disease Act, and a number of other statutes. However, two noteworthy gaps in the legislation now in effect are to be found in the absence of any State legislation relating to the medi- 157 cal examination, nursing and clinical treatment of school children and in the absence of a building code. Mandatory or permissive laws relating to the health supervision of school children are now found in no fewer than 25 of the States. It seems to be accepted opinion that not only should there be medical inspection of school children for the detection of cases of contagious diseases, but also annual physical examinations to detect other diseases and physical defects which should receive treatment, and to in- dicate needed adaptation to school work; also sight and hearing tests, nursing service, not only in the schools, but for follow-up work, and pro- vision in school clinics and the like for such medical, dental and ophthal- mic treatment as is needed to supplement that which the families provide privately for their children. The Commission is not prepared, however, to recommend for adoption in this State any definite legislation relating to this matter. First to be mentioned in public health administration is the De- partment of Public Health, which, as reorganized, was established by the Civil Code adopted in 1917. Though handicapped by a comparatively small appropriation, it is undertaking an important work in coordinating and standardizing the public health work of the State. For the great;er part, its powers and duties are investigative and advisory. The chief exception is found in the powders which are given it to suppress dangerous contagious and infectious diseases that have become epidemic and when local authorities have failed to act promptly and efficiently. Modern conditions call for a strong and liberally supported State Department of Pubic Health if disease is to be successfully combated and health conserved. Although in some of the municipalities, the local health administration is strong and efficient, this is not true in most of the localities and the State Department should be vested with power to direct and control in those matters which affect the health of the people generally. In many parts of the State the local health work has not been efficiently undertaken. An analysis made by the State Department of Public Health of reports from 343 health districts shows the limited public health nursing service ; the limited amount of public child hygiene work; a limited number of public child welfare stations; a large number of places in which no campaign has been made to secure a complete re- porting of births and deaths ; a number of cities without proper sewerage systems; the exceptional cases in which public provision is made for dis- posal of garbage ; the neglect of the water supply which frequently cannot be reported as safe ; the infrequent building codes ; the frequent absence of regulations relative to .privies ; the fairly general failure to inspect dairies with the result that the conditions in dairies arc frequently un- satisfactory or bad ; the frequent failure to report communicable disease fully ; the general absence of laboratories for health work ; and the short- comings in handling contagious diseases. The powers of the State Department of Public Health should be enlarged so that it may have more authority to direct and control matters affecting the public health. 158 TJie Tuberculosis Problem. Tuberculosis ranks first among the causes of death in Illinois, being assigned as cause of more than one death in each 11 in 1917-18. Pul- monary tuberculosis has its greatest incidence among adults between the ages of 21 and 45, and is of frequent occurrence, therefore, among workers when their family responsibilities are heaviest. Of the men rejected in the first army draft, 5.37 per cent were rejected because of tuberculosis. It is estimated that in Chicago there are 60,000, in the State outside of Chicago 50,000 active cases of pulmonary tuberculosis. Xot only is tuberculosis a very prevalent disease; it is also one of rela- tively long duration and frequently reduces families to poverty and de- pendency. As already stated, our investigations show that from 20 to 25 per cent of dependency is caused by tuberculosis. For these reasons this disease merits special consideration. Under laws now in effect, public sanatoria and dispensaries have been established by a number of the cities and counties of Illinois for the free treatment of the tuberculosis. The Department of Public Health has organized a division of tuberculosis which is organizing and directing a campaign against this disease. The educational activities of a number of organizations are also an important factor in the work being carried on. The problem which has not been and is not being solved, except by charity, is the fijiancial one of supporting the dependents of the tuber- culous wage-earner whose recovery requires that he should stop work while under treatment at the sanitarium or at home. It would appear that many of the tuberculous cannot be successfully treated if they con- tinue in their regular employment. Successful treatment, when it re- quires rest, is a relatively long process. If the tuberculous man re- mains at home he is, generally, a constant menace to the members of his family. The active tuberculous case should be treated, at least for a time, at a sanitarium, thereby removing the danger to others, as well as providing the best enviornment for his care and treatment. It appeared in evidence before the Commission by tuberculosis specialists with wide experience, that in not more than two or three per cent of the dispensary patients for whom rest or work for a limited num- ber of hours was advised, had the advice been followed, for the reason of the economic necessity of supporting dependents. A large number of localities have provided or have voted to provide sanatoria, the facilities of which are free to those who need tuberculosis treatment. Provision should now be made for the payment of those confined in such sanatoria of the amount of the earnings which they would be able to make but for such confinement, in order that the facilities provided may be more ex- tensively used. The State should say to the tuberculous man: "Your life, your health and that of your family and dependents is too important to be passed without an effort being made to save you from the disease which you have and your family and dependents from contracting that disease from you. In the view of society as it exists to-day, you are presumed to have the right to continue to do as you please in your own home, even tho\igh it may result in inflicting upon your wife and your children the 159 dread disease with which you are now affected, but if you are willing to g'lYe the months — it may be a year or more — which will be required for your treatment in a public sanitarium, Society in consideration of your so doing will pay to you the amount of the earnings which you otherwise would make during such periods of treatment. You give your time to the State for the period of treatment and the State will pay you for that time. You may completely recover. In any event, your family will not be subjected to the danger of contracting the disease which you have. It will be a good investment for you and for the State." In the opinion of the Commission the County Tuberculosis Law which provides for the establishment of sanatoria, should be so amended as to make provision for pa}Tnent to those therein confined to the extent that by such confinement earnings are lost, the limit of payment per case to be $750 per annum, which should be payable in semi-monthly install- ments by the County Commissioners of the County in which the sani- tarium is located upon certificate that the one to whom payment is made has for the period been confined in the sanitarium for treatment and has conformed to all of the regulations of the sanitarium. The certificate should be made by the medical officer in charge of the sanitarium. 6. The Prohlem of Venereal Disease. Another subject meriting special consideration is that of venereal disease. Congress has appropriated $2,000,000 to be used during the two-year period, July 1918 to July 1920, in venereal disease control. The $1,000,000 set apart to be used the first year is divided among the several states on the basis of population. Illinois' proportion for this first year is something over $60,000. This money is to be used for edu- cation in Social Hygiene and in the prevention and treatment of venereal diseases. In Illinois, this program is being carried out by the State Department of Public Health in cooperation with the United States Public Health Service. The amount of money available in Illinois the second year under the Act of Congress will depend, within limits, upon an appropriation of a like amount by the State. Thus an appropriation of $60,000 or less by the present General Assembly for venereal disease control in Illinois in 1919-20 will be augmented by a like sum from the national government. What further action Congress will take in the matter will no doubt depend largely upon the success of this experiment. Since June, 1917, the reporting of venereal diseases in Chicago has been required by ordinance. More recently the State Department of Public Health has made mandatory the reporting of these diseases throughout the State. The making of venereal diseases reportable and the appropriation of public money for their control and prevention are two steps of pri- mary importance in the campaign against these diseases. They mark the recognition of venereal disease as a community problem and the be- ginning of community action for their control and possibly their eventual eradication. The Commission recommends that the General Assembly now co- operate fully with the federal government by appropriating a dollar for 160 every dollar the federal government has shown itself willing to spend in^ Illinois in venereal disease control. ^ 7. Maternity Care and Infant Welfare Work. 9 For the most part the Commission's investigations of maternity j care have been incidental to the family investigation in Chicago. This \ investigation showed that in 30.5 per cent of the 695 confinement cases covered, all or a part of the care was furnished free to the family; that in 41.5 per cent of the cases a mid-wife was the attendant; that in most cases these midwives had a very limited training; that about 45 per cent of those who became mothers had the service of a nurse in the hospital, of a private nurse at home, or a visiting nurse. These facts obtained are set out in some detail elsewhere in this report. It is stated bv the Federal Children's Bureau that childbirth and conditions incident thereto cause more deaths among women between the ages of 15 and 45 years than does any disease except tuberculosis, and that though there has been a marked decrease in the death rate from many preventible diseases during the last decade or two, there has been no perceptible decrease in the death rate from childbirth and attendant con- 1 ditions. The total deaths from childbirth in Chicago during 1917 were 335, which was between five and six deaths per 1,000 births. The death rate of infants under one year of age is also high. Without going into further detail we may say that among preventible causes of death of women, childbirth and conditions incident thereto rank far too high inj Illinois as does the attendant infant mortality rate. Two Chicago in-' stitutions providing skilled pre-natal and obstetrical care to patients, chiefly in their own homes, show exceptionally low maternity and infant mortality rates. In both cases, the number of deaths in confinement has been materially less than one per thousand. The extension of such service in Chicago and throughout the State would greatly reduce the number of deaths of mothers and babies at the time of childbirth and from conditions closely related thereto. Accurate data relating to mortality among young children are avail- able for only a few cities in the State. Such data as are available and experience indicate, however, that there are great possibilities of reducing the death rate among children if known methods of care were more generally applied. Confidence in the possibility of preserving the life of babies has led a number of organizations, both public and private, to direct their energies into this work. The Elizabeth McCormick Memorial Fund is engaged primarily in an educational campaign. The Infant Welfare Society of Chicago is organized very largely for the purpose of caring for children under two years of age. It maintains infant welfare stations in various sections of Chicago and in 1917 employed 30 nurses. The records of the Society show that the mortality of babies coming under the care of its physicians and nurses has declined from 4.2 per cent in 1911' to 2.2 per cent in 1918. The City Health Department also operates four infant welfare stations. Xursing service has been an important factor in infant welfare work and the reduction of mortality. Work 161 similar to that described in Chicago is being carried on to some extent in other cities and towns of the State. Several organizations have been found that devote part of their attention to this problem. There are about 100 Public Health nurses outside of Chicago and a majority of these devote a part of their time to infant welfare work. In view of the facts enumerated above and presented in much more detail in Cha]|ter II the Commission recommends the appointment of a Commission to study and investigate the mortality of women in child- birth and of infants in the State; facilities for obstetrical service; and such other matters relating to pre-natal, obstetrical and post-natal care as affect the health and well-being of mothers and infants. 8. Hospital Facilities. Measured by the only available standard — the ratio of hospital beds to population in the United States as a whole — Illinois' hospital facilities are inadequate, being only 62 per cent as great as the average for the country as a whole. The ratio for Chicago is twice that for the rest of the State. The inadequacy is most marked in the smaller towns and in rural communities. Yet hospitals are so supported, constructed and I organized that their actual use by the community falls far short of their I capacit3\ Taking the State as a whole, less than 60 per cent of the maxi- mum facilities of the privately conducted general hospitals were used during the last fiscal 3'ear, notwithstanding the fact that the maximum facilities are inadequate in relation to the need. Studies made by the Commission of families in typical wage-earning communities in Chicago and comprising 41 blocks, show that 399 or 20.9 per cent of the 1,909 families reporting sickness costs had hospital service for one or more members during the 3'ear. Approximately 50 per cent of these families paid for the service and 50 per cent received it free. This and other facts I indicate the need not only for more hospital beds in Illinois, but for I increased free and moderately priced hospital service. Hospital facili- ties, both as to quanity and as to the amount of free and moderately priced service, are much more nearly adequate in Chicago than in the rest of the State. The Commission believes that a partial solution of the hospital problem in communities which do not have county hospitals lies in the establishment of public county hospitals. Such hospitals should be supported by the county out of public funds, should provide free service for those unable to pa3', but should also be available for patients who can pay. The county tuberculosis sanitarium could to advantage to its patients and staff be made a unit of the county hospital. Such a hospital should have an obstetrical department the facilities of which should be available for any woman in the county needing such service. In the county hospital should be x-ray and laboratory equipment and service avaiable for all physicians in the count3' — free for those patients need- ing it free and furnished for pay to others. Such diagnostic facilities may well be provided and maintained by the State Department of Public Health. Clinics should be held in these hospitals for the treatment of ambulatory patients needing free service and for others needing treatment —11 H I I J 162 which can be adequately given only in such an institution. Physicians who attend the free patients in such a county hospital should be com- pensated for their services. Such a hospital could well be the head- quarters of the county health officer and the county public health nurses- Such an institution would naturally become the health center of the county, serving the people of the county in the solution of problems affecting their health. The Commission recommends the enactment of such laws as may be necessary to enable counties to establish such hospitals, and the State to provide and maintain diagnostic facilities therein. 9. Public Health Nursing. Public health nursing is making a distinct contribution to health protection and conservation in Illinois. Yet outside of Chicago and two or three other cities this type of public health work is not well developed. Infant welfare work, protection of the health of school children, home care of the tuberculous, prenatal and obstetrical care in the home and other important phases of health work are dependent in large measure upon efficient and ample nursing service. Because of the importance of public health work and because of the value of nursing service as a part of it, the Commission recommends the provision of public health nursing in every county in the State. 10. Health Insuran ce . The Commission was instructed to investigate and report on exist- ing health insurance and on proposals made for adoption in this or other states. Among the proposals is compulsory health insurance. Compulsory health insurance is the phrase commonly used to desig- nate systems which exist in ten European countries under which partial insurance is provided against the losses attendant upon sickness. These countries and the dates the systems were established are as follows : Germany 1883 Serbia 1910 Austria 1888 Great Britain 1911 Hungary 1891 Russia 1912 Luxembourg 1901 Poumania 1912 Norway 1909 The Netherlands 1913 The essential elements of the systems are: (1) The com]3 alsorv insurance of wage-earners whose income is less than a statea amount. (2) Insurance may be carried in such organizations as conform to the established standards, but all not so covered are insured in state or district organizations created. (3) The cost is borne by the employe r, the employee and the state in varying percentages. In England, fof~example7me percentages are approximately 45, 35 and 20 per cent for these three respectively. (4) The benefits vary but generally include : a. A cash payment, generally from 50 to 60 per cent of the wage during the period of disability, but not to exceed 26 weeks. 163 b. Medical care and perhaps surgical and hospital services and medicines for the insured or for the insured and dependents. c. Special maternity benefits in a cash sum paid at the time of childbirth. d. A cash payment to cover the cost of burial of the insured. The foregoing is a brief and incomplete summary. It is presented here to indicate generally the nature of the established systems. In Chapter IV a more adequate statement will be found. The establishment of compulsory health insurance in the United States has been advocated for several years. Commissions to investigate the subject have been appointed in eight states. The Commissions of California, New York and Ohjo and one of the two in Massachusetts have reported in favor of compulsory health insurance. Those of Con- necticut and Wisconsin and the second Commission in i!ttassachusetts have reported agailist it. Bills providing for compulsory health insurance have been intro- duced in several states in this and previous years. No state has as yet;, passed such a law. Amendments to the state constitutions of^ Massachusetts and California were proposed so as to Justify the enact- ment of compulsory health insurance laws. The Massachusetts Consti- tutional Convention did not adopt the amendment proposed. In Novem- ber, 1918, the electorate of California defeated a proposed constitutional amendment providing for compulsory health insurance by a vote of about three to one. In determining whether compulsory health insurance should be adopted in Illinois, the country of its origin, the alleged motives of those who first advocated it or who have since urged or opposed it should be disregarded. These are irrelevant matters. Compulsory health insurance should be tested by what it has accom- plished; what would be the probable result in Illinois; whether in the light of the need for and the effects of a compulsory health insurance system it would be a sound public policy for Illinois. In arriving at a conclusion, the best interests of the State as a whole must be kept constantly in mind without regard to any special interest, whether it be that of the wage-earners, the employer, the person ' insured or the insurance organization, the non-medical practitioner or the licensed physicians and surgeons; that of those who would and of* those who would not be insured; of those now dependent upon charity and of those who are not; of those who would receive benefits and of those who would not, but who nevertheless would contribute to the cost of the system. Without further enumeration, it is^ apparentj that a com* pulsory healtli insuran?rfr-sfsteni 'co mes JncontacT wi th so i!!HTry in- teresfeofjfch^-dmmdAials or ^axtii ps who consti tute Society and_aiTegls them sojtally-4hAt4^e^quS demand'''oriiecessity and the welfare of the people of the State as a whole. Si ckness is certaiiU-t£L..^g«ct^ substanti al^m«jtm#v^-4^£-4h«-^age earners Tn~fTTeTourse of a year, because eitheTthey or those dependent upon them will be sick. Considering the group as a whole,. the proba- 164 bility for a year is susceptible of reasonable determination. Consider- ing the individuals of the group upon whom the incidence of sickness falls, there are wide variations in the period of disability and in the attendant losses caused by sickness. The uncertainty as to whether a given individual will be sick, and, if sick, as to the loss caused thereby clearly justifies the application of the insurance principle to the sick- nesfl hazard. The recognition of the application of the insurance prin- ciple to the sickness hazard is shown by the compulsory insurance systems of Europe and the voluntary insurance now provided by organizations of different types in Illinois. Insurance against the sickness hazard is now provided in Illinois by unions, establislmifioit funds of different kinds, fraternal and benevo- lent"^cieties, in dependent for eign societies, and by mutual an d stock companies. Some of the last named are writing insurance for groups of employees. As nearly as it can be estimated 30 per cent of the wage- earners of the State now have health insurance provided by one or more of these organizations, and the percentage so insured has been increasing. In the "Block Studies" in Chicago it was found that while only 23.7 per cent of all the wage-earners were insured, 36.7 per cent of those who were the main support of families had insurance against sickness or against sickness and accident. Of the wage-earners who were the main support of families, approximately three-fourths had life insurance in some form, averaging $750 per person. This ordinarily becomes* available for the pa3'ment of burial expenses as well as for meeting the needs of d^endents. For most of this voluntary insurance the e mployees pay the ent ire XQst. For some, however, the employers and the employees both con- tribute, or the employer pays the entire cost. The cash benefits paid in indemnification of wage losses vary from $2 to $15 or more per week, during disability, with a limitation generally of from 13 to 26 weeks. This, briefly, is the existing insurance situation as found in Illinois. Wliat has compulsory health insurance accomplished in those countries where it has been adopted ? There is no- evidence that compulsory insurance has resulted in an improvement in heal^ The death rates and morbidity statistics of the countries which do not have compulsory health insurance show a decline fully equal to that of the countries which have such systems. The explanation is probably found in the fact that compensation for wage losses caused by sickness hais a very minor effect upon health, that be- cause of the freedom of choice of physician for treatment' (which free- dom exists even under the compulsory system) the quality of medical ser\2ceis_iiat-ii£^)roved, that the advance in medical science, public health CQfrtroL educational movements for better personal hygiene, and the many factors which have entered into the prevention of disease, have operated with equal, if not greater vigor in those countries which do jiTot have compulsory health insurance. It seems clear that compulsoryj I health insurance is not an important factor in the prevention of disease yor in the conservation of health. 165 Compulsor}^ health insurance has standardized the insurance against losses attendant upon the sickness of wage-earaers. It provides partial compensation for the loss of wages, and provides medical care. To the- extent individual wage losses and medical costs are provided for a ^.^ material benefit results. Our investigations in Chicago show, however, that a large percentage of the cases of poverty caused or accompanied by sickness would not be avoided by compulsory health insurance of the kind that has been proposed. They show, also, that it would not prevent as much as a fourth of the cases of dependency upon charitable agencies for material relief. The systems of compulsory health insurance established and the proposals therefor advocated in this country provide for payment of the cost by percentages to be contributed by the employer, the employee and the State. Compens ation f or occupational disease sh ould be pro vided by the employ (}!' Ih Whose emplu3'menL the disease is Incurred. 'Occu- pational disease lb a liazu rd p^jci dlcii ' Lu iho inductry con cerned. It is caused by that industry. With non-occupational diseases the case i? different. Tnr histry neithpr (^puse^ snQh^ disea ses nor^do es it benefit from the insurance against the losses caused^ by {hem. Tne tae4s.«slK)uld be fairly met. If there is no rational basis for a contribution by the em-A ployer the requirement that he shall contribute is in effect an increase I in the wage scale established by law. Ten cents per day will provide the wage-earner with all the insur- . ance needed. With few exceptions, the wage-earners can meet the cosi/ if they desire. If the wage paid in a given employment is not sufficient, it should be increased, but all employers should not be charged with an increase in wages because of the failure of some to pay a living wage. Likewise the burden proposed to be placed upon the State and all employers for part payment of the cost of insurance for all disease of all wage-earners would compel the State and employers to pay for that which they did not causQ and for which they are not responsible in y^ any real or tangible sense. The proposal for proportional contribution is based \n its ultimate analysis solely upon expediency. It is tht expediency of obtaining for the apyMcation of the prin- ciple of compulsion the support of the immediate beneficiaries by the appeal that the cost to them will be in part borne by the State and the emploj'er; the expediency of compelling a financial interest in the system so that its machinery will have the alleged benefit of an enlarged judg- ment as well as the use of existing Jjusiness organization for the col- lection of premiums through the employer. The cost of compulsory health insurance in Illinois would be be- tween $50,000,000 and $60,000,000 annually, conservatively estimated on the basis of the investigation of sickness among wage-earners and the attendant costs. The annual premiums would be something more than the annual cost. If existing health insurance carriers were used and continued their present amount of insurance, there would remain be- tween $40,000,000 and $50,000,000 to be carried in State or local funds establshed. This would inevitably lead to political control and ]^imin^P- ^jnent. Payments from a State insurance fund and its operations would 1G6 not be similar to the expenditure of public moneys for purposes of government, or for public service, or for the construction of needed public works. Twenty per cent of the wage-earners would be entitled to cash payments each year from these public funds, which each year would be lepienished to the extent of $40,000,000. With the experience of doctois frequently asked to certify falsely to sickness disability under present insurance contracts, or the union expel lence o± sickness claims being used as a cover for unemployment, what conlidence could be had in a politically controlled and managed fund of such piopoitions with no practical check upon its disbursements annually to neaily 400,000 in the State? 'I'he honesty or integrity of public administrators is not in question. Nevertheless the necessary size of the proposed system, the difficulties I attendant upon proper administiation and the probability of inadequate supervision and contiol suggest considerations which are of the greatest irnportance. it is tiue, of course, that voluntary health insurance in Illinois is not standardized. In this regard, it is, however, not different from many forms of activity with respect to which it has not been regarded as necessary to interfere with the freedom of contract or conduct of the individuals concerned. Voluntary health insurance, ^ unlike life insur- ance, is of comparatively recent general development. It is to be ex- pected that health insurance will show a growth and tendency toward standardization as the importance of such insurance receives more general lecognition. Ceitam of the methods by w^hich the sickness hazard is insured agamsL aie of compaiatively recent origin and during the short period of their use have extended rapidly. The recognition of the importance of health insurance is glowing. It will continue to grow. More and moie of the waoje-earners each vear will be insured. The main difficulty at the present time is the unwillingness of wage-earners to insure because of the lack of appreciation of the relative importance of insurance and other things. Some are prudent; some are thrifty; some are impiovident. Few could not pay for the insurance if t they desired so to do. • *^ Society does not consider making it a legal requirement that the individual «hall each pay-day save a portion of his earnings to provide against the almost certainty of unemployment, or that he shall have life insurance to provide against the certainty of death. Not until the -. freedom of the individual threatens society in a direct and immediate / ay, is it considered a sound policy to compel the action of the individual. I Compulsion by law has freqeuntly resulted in conduct beneficial to the individual when considered solely as a physical betterment. But guardianship by government of the normal adult man or woman has sooner or later either ended in disaster for the government which ^-^ tempted it or in the servility of those so governed. Hence, unless^ Society is affected in an important w'ay, the conduct of the individual should be determined by his own understanding and not by the law or government. 167 The present cost of voluntary health insurance shows an element represented by the costs of acquisition. These acquisition costs are incurred in the writing of the insurance; when voluntary a campaign of education, persuasion and good salesmanship are necessary. The application of the principle of compulsion would decrease very materially the costs of acquisition. In this respect, however, insurance is not different from most social activity. The costs involved in creating a demand for or an appreciation of a given commodity are always present, except where the State by fiat of law determines that the individual shall conduct himself in a manner prescribed by law and shall conform to the standard thereby established. It is the opinion of the Commission that its findings do not justify it in recommending compulsory health insurance. ^. , 11. Occupational Disease. The subject of occupational diseases was not investigated by the Commission. This is a subject requiring special knowledge and the service of experts highly specialized and trained. Limitations of time and money and the inability to obtain the services of such experts during the war were such that in the opinion of the Commission it could not conduct an investigation of occupational disease such as the importance of the subject requires. In 1911, an Illinois Commission on Occupational Disease investi- gated and reported. That Commission indicated that the subject should have further study. This Commission is of the opinion that the losses attendant upon occupational diseases should, as a matter of fundamental principle, be paid by the industry causing the disease. However, the diseases which should be covered and the method by which payment should be made constitute an important and difficult probleni. The Com- mission is of the opinion that the Legislature should appoint an Occu- pational Disease Commission to thoroughly investigate and report as to the proper solution of this problem. 12. The Commission's Recommendations. Brought together, the Commission's recommendations are as follows : 1. That the authority and powers of the State Department of Public Health be enlarged in such manner as to give this Department the direction and control over public health administration in the State, including the administration by the local public health bodies as now constituted, required for a proper coordination, direction and control of matters pertaining to the public health. 2. That the County Tuberculosis Act be amended so as to provide for payments to wage-earners under treatment in the County Tubercu- losis Sanatoria. (A suggested bill is presented as "Exhibit 1.^') 3. That the Legislature appropriate the sum of $60,000 for the control of venereal disease in accordance with the program therefor initiated by the Federal Government. A like amount will thus be avail- able from the appropriation by Congress for this purpose. The im- portance of this subject is such as to indicate the desirability of the 168 Legislature's appropriating this amount which is the maximum to which the State of Illinois could be entitled. from the Federal appropriation. The amount of the Federal appropriation available for Illinois will be limited by the amount which Illinois appropriates. 4. That a Commission be created to study the problem of Occu- pational Diseases and the methods for the payment of compensation for losses occasioned thereby. 5. That a Commission be created to study and investigate the mortality of women in childbirth and of infants in the State; facilities for obstetrical service; and such other matters relating to pre-natal, obstetrical and post-natal care as affect the health and well-being of mothers and infants. (A suggested bill is presented as "Exhibit 2.''.) 6. That such legislation be enacted as may be required for the establishment of a county hospital in each county of the State, and for the provision and maintenance of diagnostic facilities tlierein by ^ the State. 7. That such steps be taken as may be necessary to provide public health nursing service in each county of the State. It seems appropriate at this place to call attention to the fact that at the time H. A. Millis undertook the work as Secretary for the Com- mission, at his request, it was made a condition of his so doing that he should not participate in the determination or formulation of the con- clusions and recommendations of the Commission. This condition has been complied with. Mr. Millis has not been present at any of the meet- ings of the Commission at which its conclusions and recommendations have been determined. Mathhew Woll, a member of the Commission, was called to Washing- ton, D. C, in September, 1918, in connection with work which required his continuous presence there. As a result, he has not participated in the determination of any of the conclusions or recommendations of the Commission. w1lli4m butterworth, Dr. E. B. Coolley, Edna L. Foley, Mary McEnerney, M. J. Wright, William Beye, Chairman. MINOEITY EEPORT. The undersigned members of the Commission concur in all the recommendations made by the majority of the Commission as set forth above in the section entitled, "The Commission's Recommendations." Yet we feel that the recommendations made fall far short of what is called for by the facts disclosed by the Commission's investigations. Moreover, we do not agree with the majority of the Commission in their conclusions relative to compulsory health insurance's set forth under the caption "Health Insurance." We believe that the results of the investigations made for the Commission are conclusive evidence 169 of the need for a system of compulsory health insurance which would be applicable to practically all members of the wage-earning group, would more equitably distribute the burden of the costs of sickness and would make more adequate provision for the, medical care of wage- earners and their dependents who become sick. Consequently, we dis-- sent from the conclusions reached by the majority of the Commission tnat '^It is the opinion of the Commission that its findings do not justify It m recommending compulsory health insurance." We believe that tnis conclusion of the majority of the Commission is founded on an m- aaequate and somewhat misleading interpretation of the facts dis- closed by the investigations made for the Commission. We set fortli m the following statements what we believe to be the logical conclusions to be drawn from these facts as summarized in Chapters I to IV of this report. 1. kSickness is a serious problem. — This is shown by its extent, duration, cost and its economic and social effects. ^^a) As to the extent of sickness, 65.8 per cent of the 3,048 fami- lies included in the investigation made of wage-earning families m Chicago had one or more cases of serious sickness in the year. In 571 tamilies serious sickness was confined to wage-earners or members other- wise gainfully occupied; in 543 families a gainfully occupied member and one or more dependents were sick; in 891 families the sickness was not that of a wage-earner. Granted that the families investigated were fairly typical, this means that two out of every three families (65.8 per cent) will have one or more cases of serious sickness in a given year. Jj^xpressed in another way, it means that the chances are two to one that a family will have one or more of its members seriously sick in a given year. Wage-earners and persons otherwise gainfully occupied were sick in 1,114 or 36.5 per cent of the 3,048 families. This means that more than one out of every three families will have one or more gain- fully occupied members ill in a given year. Five hlmdred forty-three wage-earning families had one or more gainfully occupied and one oi- more other members sick. This is 17.8 per cent of all the families. (b) The problem of sickness is serious because of the time loss it entails. — In Part I, Chapter I, attention is called to the fact that if sickness among w^age-earners were spread over the entire working popu- lation, it would produce an average loss of approximately nine days for eacli wage-earner. Assuming that this is correct, the fact has little significance because sickness does not so distribute itself. Nine-hundred- thirty-seven or 20.9 per cent of 4,474 wage-earners covered by the Com- mission's family investigations lost a week or more during the year be- cause of sickness. The average time loss for 901 of these was 7.35 weeks each. This is 14.1 per cent of a year. How unevenly this loss of working time is distributed is seen by the figures taken from the benefit associations and set forth in Part I, Chapter I. These figures show that of those disabled for more than seven days,^ 65 per cent will be sick for less than four weeks; 19 per cent from four to eight weeks; 7 per cent from eight to twelve weeks ; 6 per cent from twelve to twenty- 1 In the investigation made, this was 19.9 per cent of the number exposed. mo seven weeks; 3 per cent for more than six months; and 1.29 ;per cent for more than a year. (c) 21ie cost of sickness is another important factor in determin- ing its effect. — The direct losses due to disabling sickness are lost wages and costs of medical service. For 1,667 wage-earning families from which the Commission's investigators obtained complete data as to sickness costs, the average total cost of illness was $97.98 per family. This represents an average income loss of 7.5 per cent. The cost of sickness as well as the incidence of sickness was found to be highest in the group with lowest incomes, averaging $107.33 in families whose incomes for the year were not more than the equivalent of $850 for a family of man, wife and three children under fifteen. (d) Sickness is a serious problem in its economic and social effects — Two-hundred-ninety or 16.7 per cent of 1,744 wage-earning families in which there was sickness (not including 58 families who made in- complete reports as to income) had deficits or were unable to meet the year's expenses out of the year's income, as against 40 or 4.7 per cent of 854 families without sickness but . having deficits. These deficits were met in various ways. Out of 247 of the 290 families, 35 received charity, 64 made loans, 37 used previous savings, 104 left bills unpaid, 32 used money from insurance and 14 met the deficits in other ways. Deficits" due to sickness costs would have been considerably greater had not many of the families been recipients of free medical service. Of 1,909 families reporting sickness costs, 298 or 15.6 per cent had no medical service at all for disabling sickness of a week or more duration. Two-hundred-seventy-three families or 14.3 per cent had the free service of a physician. Thus 571 or 29.9 per cent of these families, excluding those who obtained treatment in hospitals and dispensaries, either went without treatment or received medical service as a charity. One-hun- dred-ninety-eight or 10.4 per cent of the families had hospital service for which they paid.^ As against these 201 or 10.5 per cent had free hospital service. Three-hundred-sixty-nine families or 19.3 per cent secured medical treatment in dispensaries. Though some of these dis- pensary patients paid small admission fees and fees to cover costs of medicines and appliances, they did not pay for medical service. The sum of the families who received free medical service directly from physicians or through hospitals and dispensaries is 843 or 44.1 per cent of the total number of families considered. Making a liberal allowance for duplication in the obtaining of this free service, one is fairly accurate in stating that 40 per cent or two out of every five wage-earning families who had disabling sickness of a week or more duration had recourse to medical charity sometime during the year. Of the 1,909 families, 213 or 11.2 per cent had nursing service from either a private duty nurse or a visiting nurse; 42.8 per cent paid in part or in full for this service and 57.2 per cent received it free. 2. Sickness is a problem calling for the application of the insur- ' ance principle. — Insurance is cooperative provision against individual losses. Sickness is a risk to which every individual is exposed. In- 2 This may or may not have included payment for physicians' services. 171 surance is a means of distributing losses. The losses due to sickness, if distributed over the entire wage-earning group and paid in weekly, semi-monthly or monthly installments, would not fall heavily upon any one individual, while on the other hand individual or family sickness costs frequently cause substantial deficits, lowered standards of living and other unfavorable results. The incidence of sickness in any con- siderable group is so constant as to make the risk insurable on a sound actuarial basis. 3. That sickness is an insurable risk is generally recognized — Evidence of this is seen in the number and variety of organizations pro- viding some form of health insurance. In Illinois such insurance is provided by numerous establishment funds, trade unions, fraternal societies, independent foreign benefit societies, casualty companies, and assessment associations. 4. In spite of the fact that there is this great variety of carriers in the State, the great majority of ivage-earners have no health insurance — The Commission's study of wage-earning families in Chicago shows that of 4,456 wage-earners, 1,055 or 23.7 per cent carried some form of dis- ability insurance. Of wage-earning husbands the percentage carrying disability insurance was 36.7. Thus over three-fourths of the wage- earners studied did not report themselves as protected by insurance against sickness risks. It was found, moreover, that the families in the lowest income group had the least health insurance. Our investigations show that only about 30 per cent of wage-earners in Illinois have health insurance of any sort and that of wage-earning families in Chicago there is even a smaller percentage, namely 23.7. 5. Much of the health insurance carried by wage-earners is inade- quate and costly. — Information obtained by the Commission's investi- gators leads to the following conclusions relative to the disability benefits received from the various sickness insurance carriers : (a) That though 20.9 per cent or 4,474 wage-earners lost wages for a week or more during the year, only 13.4 per cent of these received benefits partially indemnifying them for such loss. (b) That the average loss was $118.76 and that the average benefit . received was $52.44 or but 44.1 per cent of the insured wage-earner's 'loss. (c) That taking the group as a whole, the disability insurance received was only about 6 per cent of the wage loss caused by disabling sickness of a week or more in duration. (d) That not only was there most sickness and a greater average wage loss in the lowest income group but that the average benefit was lowest in the same group, being but 15.5 per cent of the wages lost as compared with 43.1 per cent and 47.4 per cent respectively in the two higher income groups. With the exception of a limited number of establishment funds, the whole cost of such insurance is borne by the wage-earner. It is our opinion that industry and the community are partly responsible for the losses sustained and should make contribution to the funds needed to cover them. Certainly such facts as are cited or referred to in section 172 7 of Chapter I of this report leave no reasonable doubt as to the responsi- bility of industry and the community for much of the illness among wage-earners and their families. Moreover, it cannot be denied that both industry and the community as a whole would benefit materially from any substantial improvement in the situation which obtains, whether in a reduction in amount of sickness and. impaired efficiency or in a lessened feeling of discontent. Health insurance provided by casualty companies is very expensive, as shown by the fact that less than half of the money paid in as premiums is paid out in cash benefits to the sick. 6. Most of the health insurance carried by wage-earners in Illinois provides p/artial indemnity for lost wages only. — It falls short of the de- sirable in that little of it includes any provisions for medical service. 7. There is distinct need for a better organization of medical service for wage-earners. — It is an indisputable fact that the well-to-do (outside of the wage-earning class) and those who have recourse to medical charity receive the best medical service. The fact that about 40 per cent of wage-earning families in Chicago, covered by our investigations, had recourse to free medical service in a vear reveals a condition which is unfair to both the wage-earners and the medical profession. 8. // the application of the insurance principle to the problem of sickness among wage-earners and their dependents is to be most effective it must be universal. — All experience shows that if such insurance is to be extended ip more than a mere fraction of the wage-earners, it must be compulsory. We believe that the above analysis of the facts disclosed by the in- vestigations made for the Commission is the only logical interpretation of these facts and would have justified the Commission in recommending the immediate adoption of compulsory health insurance in Illinois. In our opinion cash benefits partially indemnifying the loss of wages and the provision of medical care for Avage-earners and their dependents would be of great value. We see no reason why the organization of medical practice under compulsory health insurance could not be so effected as to promote the interests of the insured, the medical profession and the community as a whole. When health insurance is made compulsory all experience shows that most of it will be carried by such organization^ as those in which a minority are now insured and which will become standardized in order to qualify as carriers. It would perhaps be neces- sary to establish local mutual organizations for those who could not or would not join existing organizations, but what basis is there for assum- ing that these would be politically controlled? In view of the fact that the officials of these organizations would be elected by those who con- tribute to the funds, it seems to us that the assumption contained in the majority report that they would be so controlled is gratuitous. With reference to the point made in the majority report that com- pulsory health insurance has not been an important factor in the pre- vention of sickness, we would not claim thgifcompulsory health insurance is intended as a preventive medical measure. Like many other forms of insurance it is not intended to eradicate the risk against which it offers 173 protection. We would call attention, however, to the fact that the British Medical Society has expressed the opinion that the medical care of English wage-earners has been materially improved under compulsory health insurance. Grood medical care prevents much disabling sickness. Moreover, insurance supported in part by industry and the public may arouse a greater interest in the prevention of disease. Alice Hamilton, M. D. John E. Ransom. EXHIBIT I. A Bill For AN ACT to amend the title of and an Act entitled, ''An Act to author- ize county authorities to establish and maintain a County Tuberculosis Sanitorium, and branches, dispensaries and other auxiliary institutions connected with the same, and to levy and collect a tax to pay the cost of their establishment and maintenance/' approved June 28, 1915, in force July 1, 1915. Section 1. Be it Enacted by the People of the State of Illinois, represented in the General Assembly: That the title of an Act entitled,. •'An Act to authorize county authorities to establish and maintain a County Tuberculosis Sanitorium, and branches, dispensaries and othei auxiliary institutions connected with the same, and to levy and collect a tax to pay the cost of their establishment and maintenance,^' approved June 28, 1915, in force July 1, 1915, be amended so as to read, "An x4ct to authorize county authorities to establish and maintain a Count}' Tuberculosis Sanitorium, and branches, dispensaries and other auxiliar} institutions connected with the same, and to levy and collect a tax to pay the cost of their establishment and maintenance, and to provide for the partial support of those dependent upon those who are under treat- ment in a County Tuberculosis Sanitorium and the levy and collection of a tax to pay the cost thereof ;" and that said Act be amended by add- ing thereto a new section, to be known as Section 7%, to read as follows^ Sec. 7I/2 (1) A county in which there is established and main- tained under this Act, a County Tuberculosis Sanitorium, shall pay semi- monthly to each one who is confined in the Sanitorium and is therein receiving treatment for tuberculosis, an amount equal to one-twenty- fourth (l/24th) of his earnings for the year preceding his entrance into aaid Sanitorium, subject to the following conditions : (a) Payment shall be made only to one who was a resident of the county for one year previous to his entrance into the Sanitorium, and upon whom, at the time of entrance therein, a wife or child was depend- ent for support. (b) Any semi-monthly payment to any person shall not exceed the amount of Thirty Dollars. (c) Semi-monthly payments to any person shall not continue be- yond two years from the time of the first payment. (d) Payment shall be made only after the issuance of a certificate in accordance with the rules prescribed by the Sanitorium Board of 174 Directors, showing that the one to receive the payment has been under treatment in the Sanitorium during the period covered by the payment, and has conformed to all the rules and regulations of the Sanitorium. (2) A county which makes provision for the treatment of those who are tubercular by arrangements with another count)^ which maintains a County Tuberculosis Sanitorium, under the provisions of this Act, shall make semi-monthly payments to the residents of the first mentioned county whose treatment is provided for, which payment shall be made in the same manner as provided in this section for counties which main- tain a County Tuberculosis Sanitorium. (3) To provde for the payments as required by this section, a tax shall be levied and collected by the county in the manner provided for the levying and collection of taxes for county purposes, which said tax shall be in addition to all other taxes which said county is now or here- after may be authorized to levy on the aggregate value of all property within said county, and in reducing tax levies under the provisions of Section 2 of an Act entitled, "An Act to amend Section 2 of an Act entitled, ^An Act concerning the levy and extension of taxes,' approved May 9, 1901, in force July 1, 1901, and as subsequently amended, the tax authorized by this section shall not be considered as a part of the general tax levy for county purposes, and the same shall not be included in the limitation of the assessed valuation upon which taxes are required to be extended, as provided in said Act as subsequently amended. EXHIBIT 2. COMMISSION TO INVESTIGATE CONDITIONS CAUSING MATERNAL. AND INFANT MORTALITY. § 1. Creation and Duty. § 2. Members. § 3. Powers. A Bill For AN ACT to establish a commission to investigate conditions causing ma- ternal and infant mortality and the facilities for providing care for women in childbirth. Section 1. Creation and duty.] Be it enacted by the People of the State of Illinois represented in the General Assembly: 'J^hat a special commission is hereby created to be known as the Maternal and Infant Welfare Commission which shall investigate conditions causing death and disability of women from childbirth and conditions incident thereto and of infants. It shall investigate the facilities for the provision of prenatal, obstetrical and post-natal care, and other conditions which effect the health and well-being of mothers and infants in the State. The Commission shall hold public hearings in different parts of the State. The Commission shall submit a full final report, including such recommendations for legislation by bill or otherwise as in its judgment may seem proper, to the General Assembly of nineteen hundred and § 4. Cooperation of other Departments. § 5. Appropriation. 175 twenty-one and unless continued by such General Assembly, shall expire at the end of its regular session. Seo. 2. Members.] The Commission shall consist of two physicians, one nurse^, one social worker, one hospital superintendent and two other persons to be appointed by the Governor. The members of such com- mission shall receive no compensation for their services, but shall be entitled to their actual and necessary expenses incurred in the perform- ance of their duties. Seo. 3. Powers.] The Commission shall have power to elect its chairman and other officers, to employ a secretary, experts in the matters to be investigated, and all necessary clerical and other assistants, to purchase books and all necessary supplies, and to rent office room, and halls for hearings. Sec. 4. Cooperation of other departments.] The Department of Public Health, the Department of Public Welfare and the Department of Eegistration and Education are hereby directed to cooperate with the commission, to give it access to their records, and to render it any such proper aid and assistance as in their judgment may not interfere with the proper conduct of their respective departments. Sec. 5. Appropriation.] The sum of twenty-five thousand ($25,- 000) dollars or so much thereof as may be needed, is hereby appro- priated for the actual and necessary expenses of the commission in carrying out the provisions of this Act, and the Auditor of Public Ac- counts is hereby authorized to draw his warrant for the foregoing amount, or any part thereof, in payment of any expense, charges, or disbursements authorized by this Act on order of the commission, signed by its chair* man, attested by its secretary, and approved by the Governor. PART II Reports of Special Investigations -12 H I 179 SPECIAL REPORT I. A STUDY OF WAGE-EARNING FAMILIES IN CHICAGO. (By Ernest W. Burgess.) [Note -by the Secretary. — In order to secure exact data bearing upon the many phases of the problems under investigation, the Commission has had an intensive study made of a limited number of wage-earning families. The funds and staff available for investigation did not permit extending the study to communities out- side of Chicago. The secretary had the assistance of several experts in preparing for this intensive study. Among these was Dr. E. W. Burgess who was later in- duced to take immediate charge of this branch of the investigation. He has inter- preted the data and prepared the following report]. I. INTEODUCTIDN. The Family Study was undertaken by the Comn^ission to obtain data bearing upon sickness, medical service, and protection against health risks. The points ^poh which information was desired were numerous : the extent and the duration ofdllness, sickness costs, the nature and kinds of medical treatment, the extent and amount of insurance against sickness and death, variation in sickness and insurance by sex, age, nationality and economic condition, and the relation of sickness to poverty and to dependency. This introduction presents : first, an outline of the divisions of the study made; secondly, a description of the methods of investigation and tabulation; thirdly, a general classification of the families studied; fourthly, a statement of the method of determining "economic status;" and fifthly, an analysis of the population and income statistics for the families studied. (1) Divisions of the Family Study. Families were selected in three ways so that the Family Study falls into three parts: the block study; the nursing service study; and the charity study. The hloch study. — Since proposed systems of health insurance have as their objective the protection of wage-earners and their families from the risk of sickness and non-industrial accident, it was considered ad- visable by the Commission to secure from a representative group of independent wage-earners data relating to sickness, to existing: Tnethods of conserving health, and to insurance and other methods designed to meet the risks of sickness and death. Two alternatives were possible. One was to visit at random families throughout the city, the other to canvass every family living in certain blocks representative of the group of wage-earners in Chicago. The second plan was adopted because of the greater opportunity for the control of the selection of families and for the verification of the results secured. 180 Instead of the geographical block the social block was made the unit of investigation. By social block is meant the two sides of a residential street. Social and civic workers recognize that the social block repre- sents a natural social group and that the alley is a line of separation rather than of connection between families. The blocks studied were carefully chosen in order to be represent' ative of Chicago's wage-earning population. The investigations made by the School of Civics and Philanthropy into housing conditions in Chicago were utilized in the selection of blocks with known differences in physical structure, racial composition and economic condition. So far as possible a normal distribution of the different immigrant and racial grouj)s in Chicago was provided for. An attempt was also made to secure adequate representation of all degrees of economic condition from casual laborer to the skilled workman. The location of blocks with reference to dispensaries, hospitals and other welfare agencies was given special attention, and their geographical position in relation to the chief industries of the city w^as taken into account. In addition to fill- ing out a schedule for each family, the investigator was required to write a statement to cover each block, indicating the typical facts of its physical structure, its racial composition, the economic status of its families, the range of rents paid, accessibility to medical, charitable and welfare institutions, the attitude of its resideAts to medical and social agencies and in addition other facts significant for the study. The rmirsing service study. — The 304 families included in the survey of the Visiting Nurse Association cases were chosen by that organization. They are representative not only of the families which come under the care of this Association but also of the problems involved in the medical service secured. Inasmuch as all of the investigators for the .Com- mission in this study were themselves registered nurses at the time or previously on the staff of the Association and consulted the case records of the organization in addition to visiting the families, the data secured are of peculiar value from the standpoint of the sickness problem and medical and nursing service. Tli& charity study. — Through the cooperation of the United Chari- ties and the Jewish Aid Society 1,000 families were selected where sick- ness of a wage-earner or other member of the family was considered as a problem entering into dependency. The majority of these cases were "current," i. e. the families were still receiving material relief or super- vision from the organizations. A considerable number were "closed" cases, i. e. families which a short time previously had been receiving charitable aid but which were now again independent and no longer under the care of the social agency. These families were selected in the months of May and June, a period in which there are relatively few new cases coming to the attention of charitable organizations. It is therefore probable that in spite of the fact that a considerable number of "closed" case^ were included in the group, the families selected would not altogether represent the correct proportion of the different types of families seeking charity during the year. From the 1,000 cases selected by the charities, schedules for 628 families were finally available for use 181 in the study. The remaining 372 cases represent families that had moved, families that had disintegrated and families where acceptably complete information could not be secured. It is evident despite much in common tliat the three studies have three distinct purposes. The block study bears upon the problem of sickness and the existing protection against illness from the standpoint of the independent wage-earner. The nursing service survey provides the basis for an inquiry into the relation between medical and nursing service and the particular kind of disabling sickness. The charity study makes possible an analysis of disabling sickness in its relation to the problems of poverty and dependency. (2) Methods of Investigation Employed. The schedule used in the Family Study was common to the three divisions of the investigation' It was developed after an examination of schedules used in family studies in different sections of the country and with the assistance of several persons who are expert on the points covered in the study. It was first used in mimeographed form and then revised in the light of the experience gained in this way. The schedule form and the instructions issued to the investigators for the Commission are printed as an appendix to this report.^ In addition to the usual inquiries in regard to name, address, nationality, housing conditions and rent, the items of the schedule center about family composition; em- ployment, income, surplus and. deficit; value of property owned; the sickness history of every member of the family during the last twelve months ; the dispensary record for all members of the family during the last twelve months; provision, need and cost of dental v/ork; the amount and type of life and disability insurance carried by members of the family; deaths in the family during the year and cost of burial; births in family during the year; the employment of physician or mid-wife; and the cost of nursing care and hospital service. A most valuable part of the schedule was the page assigned to a history of the family known as - the "story" in which were entered significant facts not otherwise specifically called for, as, for example, the sickness experience of the family during a period of years, their attitude towards physicians, dis- pensaries and social agencies, changes in the standard of living during the year due to sickness, complete charity record, etc. The agents employed in making the block study were selected on the basis of background of social training, experience and success in social investigation, and command of language of the chief immigrant groups in Chicago. Advanced students in economics and sociology at the Uni- versity of Chicago and at the Chicago School of Civics and Philanthropy undertook the charity study for the Commission as field work in con- nection with classes in sociology, social work, and labor problems. By special arrangement with the Visiting In] urse Association the Commission was able to secure the services of registered nurses in making the nursing service study. Nearly all of the schedules in the block study were collected by four experienced investigators, on salary. ^ See pp. 313-17. 182 To each investigator was issued a card of indentification certifying to his appointment as an agent of the Commission. This was signed by tne cnaiiman of the Commission and countersigned by the Governor of the KState. Mimeogiaphed instiuctions covering in detail the items of the fccliedule weie given to each investigator. Before going into the held a conteience of agents was held for a careful and detailed inter- piCtation of the schedule and for oral instiuction in regard to methods of appioacli and the tecnnique of investigation. In practically all cases inexperienced mvestigatois weie given demonstration and supervision m tne field by supervisors for the Commission. Charity cases were fiist assigned to investigators, because of the greater difficulty in ap- pioachmg the families of independent wage-earners for the information desired. The visitois were instructed to state at once to the prospective informant the puipose of their visit and the object of the investigation so that they might secure the intelligent cooperation of the family in making out the schedule. Schedules filled out in the field were promptly edited for conference with the investigators in regard to the correction of inaccurate or incomplete entries. Less than one hundred schedules were discarded because of inaccurate or incomplete data secured by some of the student investigators. Univeisal interest in the problem of sickness and the fact that the investigation was undertaken under the authority of the State of Illinois were piobably the chief reasons for the full and relatively accurate re- turns secured by the investigators. Less than a score of over 4,000 families visited refused to give information. What inaccuracies and omissions appear in the answers to specific questions are due more to the inability than any unwillingness of families to give complete and detailed answers to these inquiries. For example, of the 2,708 wage-earning families in our "block study'^ only 110 gave incomplete reports of total family income, an entry considered one of the most difficult to secure. Sometimes the wife did not know the exact amount of the husband's earnings. Occasionally, as with casual work, or with change of em- ployment, during the year, or with loss of wages and time because of sickness and employment, it was practically impossible for the housewife to state either average earnings per week, or total earnings received dur- ing the last twelve months. The rise in wages during the year, partic- ularly in the Stock Yards and South Chicago areas, added to the difficulty of determining the total income for the year. In a few cases, chiefly, how ever, with families where the nonnal breadwinner was working on his own account, wives felt that the inquiry was too personal and so were disin- clined even when they knew the income to give a definite answer. The amount of deficit was discovered without difficulty sooner or later in the investigation. As one of the agents of the Commission states, "if the informant denied it at first she would usually ^come out' with it in emphasizing a big doctor's bill or the high cost of living or some other grievance." The returns on surplus are probably the most unsatis- factory of the answers to any item. Only Liberty Bonds — and in many families their presence brought the first surplus in years — were readily and patriotically admitted. While families were willing to state whether 183 they came out even or ahead, they were not inclined to state definitely the amount of the family surplus and to give necessary detail required to check it. It was surprising how definite, in most instances, was the knowl- edge of a family of most of the details connected with sickness. In the case of certain immigrant groups (the Italian, for example), how- ever, an understanding of the ailment was generally limited to the part of the body affected. In the charity group the records of the United Charities and the Jewish Aid Society contained in practically every case the doctor^s diagnosis. In the group of families from the Visiting Nurse Association the record given by the investigator was unusually definite and accurate. The items of cost of sickness, doctor's and hospital bills are, it is believed, quite correct because of the attention in the family economy which is given to these unforeseen expenditures. This statement applies also to cost of dental work. The cost of medicine can, however, be regarded as only a tolerably close approximation. Moreover, small outlays for medicines were probably not reported in a considerable number of cases. Dispensary entries, as found by com- parison with original records at the dispensaries, were quite satisfactory for all items except the nature of ailment. Information in regard to life and industrial insurance was easily obtained, first because the house- wife herself generally had charge of this matter, and, secondly, because she was always proud to tell about it. The weekly premium of in- dustrial policies was found to be more accurate than the amount of insurance carried. The amount, however, was computed from the premiums with the assistance of the resident officers of the Metro- politan Life Insurance Company. Less definite was the knowledge of the wife of the benefit features of the trade union to which her husband belonged, or of the establishment fund in which he was a participant. Only in case of sickness of wage-earner during the year was information likely to be complete on these items. The amount of insurance of all kinds received during the year was given accurately and in detail. The data as returned for inquiries concerning maternity were highly satis- factory. The Commission availed itself of every opportunity to verify and to correct the data secured by its agents in the field. The leading welfare agencies in Chicago maintain more or less complete records of all the families they serve. Practically all of the more important social agencies register their cases either with the Social Service Registration Bureau or with the Central Bureau of the Jewish Charities. Agents for the Commission cleared all the schedules collected in the family study through these two registration bureaus. Through the cooperation of the Cook County Agent all schedules were also cleared through his branch offices in order to verify the statement of the family of the fact of aid received and to determine the exact value in money of the monthly supplies issued. So far as the records made it feasible, all cases were also cleared through the different dispensaries of Chicago. The Municipal Tuberculosis Sanitarium gave valuable assistance to the Commission by reporting the exact medical diagnosis in all tuberculous cases recorded 184 by it. It should also be restated here that the records of the United Charities and of the Jewish Aid Society had been consulted by the agents for the Commission prior to their visit to the families. In addition to the obvious value of this pooling of all accessible data by clearing all cases through the different medical and charitable agencies of the city, two significant conclusions were derived. The first was the general confirmation of the completeness and the accuracy of the information obtained by the investigators for the Commission. Only in relatively few cases were there serious omissions or discrepancies requiring cor- rection. In the second place, records of dispensaries often made possible a precise medical defination of the nature of the ailment. The difference was one of precision rather than correctness of statement, however, be- cause the reports of the family were with but few exceptions confirmed by the examination of the medical record. The tabulation of the data collected was made by the statistical staff employed by the Commission. All the information appearing upon the schedule was taken off for the first rough tabulation. Because of the great mass of data secured and the many possible interrelations of different facts the Commission had neither the staff, time^ nor funds, to work out all the many possible final tables bearing upon the problem of sickness in its relation to other factors. Only the more important points such as age, sex, nationality, economic status, duration of sick- ness and sickness costs, nature and extent of protection against sickness, have been analyzed in detail. There remains in the possession of the Commission a mass of data unexploited but valuable from the stand- point of public health, economics and sociology. Of the 3,980 families studied 888 had dispensary records. The tables based upon the data secured relative to dispensary service are not presented in this study but form part of the special report on dispensaries.^ {3) General Classification of Families. The families in the different divisions of the Family Study are classified as follows : Depend ent and independent families. — The status of the families m the charity group is at once determined by their receipt of charity. Their status is dependency; the family is designated as dependent. With only few exceptions the families in the blocks studied and those from the lists of the Visiting Nurse Association are independent and fall into three distinct groups according to industrial status. Wage-earning families. — ^A wage-earning family is one in which the normal or the chief breadwinner is working for an employer for a stipulated wage paid most frequently by the week, but occasionally by the day or the month. Families ''on own account.'' — A family *''on own account'' is one in which the normal or chief breadwinner is "self-employed," i. e., gainfully occupied in an enterprise in which he has assumed the risk of the business. ''Retired'' families. — A "retired'' family is one no member of which is gainfully occupied either as wage-earner or self-employed. 2 See Part II, Special Report III. 185 (4) Determination of Economic Status. The total incomes of the families, without respect to size and com- position, do not provide a satisfactory basis for determining their eco- nomic condition. Nor do the wages of the normal breadwinners supply a more satisfactory criterion. Students of the relation between wages and standards of living have deserved reproach by not always taking into account all the sources of family income or of the necessary vari- ations in budgets with reference to family composition by number, sex, age and employment of its members. From the standpoint of family income, the number of wage-earners in the family and their contribution, as well as income from boarders and roomers, rent and all other sources must be included. In estimating family budgets significant variations occur not only by size of family, but also with age and sex of its memberc. For these reasons, it was considered desirable for use in certain con- nections to classify wage-earning families according to the relation be- tween the total family income from all sources and the requirements of budgets of different levels of expenditure. For the purpose of correlating sickness, the cost of sickness, in- surance and other details with economic "status" or position, our wage- earning families have been divided into three classes lettered "A," "B," and "C." For some purposes class "A" has been subdivided so as to give a fourth class lettered "W." In all cases basic figures have been taken for a family consisting of man, wife, and three children under 15 and these basic figures have then been reduced for smaller and increased for larger families in the way presently described. What was desired was to divide the families into three groups — those whose incomes could not meet the test of a poverty budget; those whose incomes would meet this test but not the test of a "decency budget ;" and those whose incomes would meet the test of a "decency budget." Such a classification we have, however, been unable to make. While a fairly satisfactory basic poverty budget figure ($850) was available as a guide, the cost of decent living had not been satisfactory studied and we did not have the time and funds required' to make the needed investi- gation. What has been done is to use a poverty budget to ascertain how many of the wage-earning families had deficient or poverty incomes. These families have been lettered "C." Their incomes are "deficient" as tested by a conservative budget. With Class C families separated out, a second basic figure, viz: $1,200, has been used to divide the remain- ing families into two classes. These are lettered "B" and "A." To be in Class B means to have a meager income, an income not to exceed approxi- mately 41 per cent more than the poverty budget would be. To be in Class A means that the income is less meager or that the family is better off than the family in Class B. Some have moderate incomes, others do not. Certainly many of them have incomes insufficient to cover the cost of decent living for that would be $100 to $200 more than the $1,200 basic figure employed in this classification. For most purposes this three-fold grouping has been used. At certain points, however, it has 186 been desirable to establish a fourth class, letter "VV." This has been done by using $1,500 as the basic figure. It is now apparent that in determining economic classes we have selected a povery budget, and then upon this have superimposed an inter- mediate and an upper budget level arbitrarily taken. The manner of finding a poverty or subsistence budget and of adapting it to the re- quirements of this study will be briefly described. In order to secure such a basic standard it was considered desirable to select a charity budget actually in use in Chicago. Social agencies in the city engaged in the work of family rehabilitation have for several years been working out what may be called poverty budgets in order to determine the smallest amount of pecuniary relief necessary to provide for the bare necessities of life. In order to secure such a standard the budgets in use in the year 1917-1918 by the United Charities, the Jewish Aid Society, and by the Funds to Parents Department of the Juvenile Court were consulted. All these budgets, although different in detail, were found to be variations of a basic budget prepared by Miss Florence Nesbitt, one of the leading authorities on budget making for needy families in the United States. After consideration of all these budgets, that prepared for the Funds to Parents Department of the Juvenile Court was selected for use with certain modifications. Two points had considerable weight in making this choice. It was the most conservative budget estimate of those at hand. Moreover, it was the only budget actually in use with all families under the care of any of the relief agencies of the city. The standard budget family, as understood in studies of the standard of living and of family budgets, consists of the wage-earner, his wife, one child between ten and fourteen years, and two children under ten years of age. The following table shows for various items necessary for subsistence, the figures of the Funds to Parents Budget and those adopted for our poverty or subsistence budget. Funds to parents budget. Subsistence budget used in family study. Food Clothing Rent Heat and light Household expenses and incidentals. Health Carfare Total subsistence budget . $475 80 132 00 120 00 66 00 42 00 15 00 $850 80 $475 80 131 00 120 00 66 00 42 00 15 00 $849 80 The estimates for each item are undoubtedly conservative for the year of the study because of the rise in the cost of living after the time of their determination according to prices in October, 1917. However, October would be quite close to the mid-point of the year of the study for our charity families while the mid-point of the year of the investi- gation for the block and Visiting Nurse Association families would be 187 closer to January, 1918. The amounts assigned to the various items taken together gave the irreducible minimum budget necessary to main- tain physical efficiency. The chief difference between the Funds to Parents Budget and our Family Study Budget figures is in the elimination of the item for health (since dependence on free medical service was assumed) and the insertion of a specified amount for carfare. The discrepancy of one dollar in the sums assigned to the item for clothing is due to a minor modification made necessary in simplifying the age-grouping as described under the item ^"clothing." A short statement may be made of the method of determining the different items included among the necessaries of existence. Food. — For food the allowance as fixed by the Funds to Parents Budget was based on current prices of foods necessary to meet scientifi- cally determined standards of food values in relation to adequate nutrition. The items vary with the age and sex of members of the family. Yearly- amount. Adult male, 15 years of age and over $130.00 Adult female, 15 years of age and over 101.40 Older child, 10 to 14 years, inclusive 88.40 Younger children (under 10 years of age) 78.00 Clothing. — The difference of one dollar in the subsistence budget used in the Family Study and that of the Funds to Parents Department is explained by the data in the following table : Family composition. Yearly amount for clothing. Funds to parents budget. Subsistence budget (used in family study.) Adult male, 15 years of age and over $45 146 Adult female, 15 years of age and over 30 30 Older children 10 to 14 years inclusive 24 24 Younger children (under 10 years of age) 16 Younger children 5-9 years inclusive Younger children 1-4 years inclusive In combining, for the Family Study, the two age-groups 5-9 years and 1-4 years, the sum of $16 for clothing was fixed upon. With one younger child of 9 years and another of 4 years the sum for the two would be $33 under the subsistence budget of the Funds to Parents Department, and $32 or one dollar less under that used in the Family Study. Rent. — In the Funds to Parents Budget no fixed amount had been assigned to rent. The usual phrase is rent "as has been paid" or "as necessary for good housing." Through the cooperation of Miss Edith Abbott of the School of Civics and Philanthropy a tabulation was avail- able for use in the Family Study of the rents actually paid by the families receiving pensions under the Funds to Parents Law. On the basis of the data from this study a scale of rents corresponding to size of family was worked out. For the family of five the average monthly rent was found to be $10 or $120 for the year. 188 Heat and light. — The item of %Q>^ per year for two stoves as given by the Funds to Parents Budget was accepted without modification, and was applied to all families regardless of size. Household expenses and incidentals. — This item, of necessity, varies with the size of family. Here again the amount as fixed by size of family in the Funds to Parents Budget was adopted. Carfare. — In the charity budgets no fixed amount was entered for carfare. The allowance made is according to what is regarded "as neces- sary.^^ Since the family study was dealing with groups rather than with individuals it was necessary to make an estimate of the average annual amount required for carfare in a wage-earning family. The irreducible minimum of expenditure for carfare was finally considered to be that necessary for the wage-earner in going to and returning from work. Assuming that there are 300 working days in the year and that only half of the wage-earners require transportation to and from work, $15 a year was added for each wage-earner in a family. The income figure ($850) necessary to meet a subsistence or poverty budget is, of course, applicable only to the standard budget family of father, mother, and three children under fifteen years of age. Using the standard budget family figure ($850) as a basis, other income figures were worked out by determining need according to size and composition of family by sex and age. From the standpoint of budget needs only four of the many possible groupings by age and sex were recognized: (a) adult males fifteen years of age and over; (b) adult females fifteen years of age and over; (c) older children between ten and fourteen years inclusive; (d) children under ten years. If we assume that every family has at least one adult, 15 years of age and over, the following represent the theoretical permutations in composition of the family according to its size ; with 1 member 2 combinations ; with 2 members 7 combinations ; with 3 members 16 combinations; with 4 members 30 combinations; with 5 members 47 combinations ; with 6 members 70 combinations ; with 7 members 96 combinations; with 8 members 124 combinations; with 9 members 150 combinations; or a total of 542 combinations, or types of budget families. For each of these 542 budget families a figure cor- responding to $850 was worked out. The method of determining a "minimum'^ standard of living for the bare necessities of life has been sufficiently described. In the absence of any acceptable study of the cost of "decent living,^^ an arbitrary flat rate increase over the figures of the subsistence budget was taken. For the standard budget family where the, subsistence budget figure was $850, the higher figure was fixed at $1,200 which represented an increase of 41.2 per cent. Twelve hundred dollars is a good round sum, about two-fifths higher than the actual standards of Chicago's charitable agencies, and therefore presumably making possible a margin of ex- penditure for some decencies over and above the absolute necessities of life. It is to be stated emphatically, however, that $1,200 was selected arbitrarily as a convenient amount, and not with the idea that it would cover the cost of what is known as "decent living." No doubt a "decency 189 budget/' as the term is loosely used, would have required an addition of $100 or $200 to the figure selected. Using this basic sum ($1,200), figures were accordingly worked out for the 542 types of families ranging from one to nine in membership by the addition of a flat increase of 41.2 per cent to the corresponding subsistence budget figures. This series of budget figures taken col- lectively will hereafter be known as the "intermediate" budget. By working out two budget levels in the way indicated, it became possible to group the families into three classes known as "A,'' "B," and Class C. Families with deficient incomes. — Where the total family income was insufficient to provide for the subsistence budget the family is classified under "Class C^' or "families with deficient income." Class B. Families with meager incomes. — Where the total family income was sufficient to provide for the subsistence budget, but was in- sufficient to provide for the intermediate budget, the family is classified under "Class B" or "families with meager income." Class A. Families with higher incomes. — Where the total family income was sufficient to provide for the intermediate budget, the family is classified under "Class A" or "families with higher incomes," or families "better off" than those in Class B. In certain sections of the study. Class A is further subdivided into two classes. The separating line between these classes is fixed at a still higher budget level which is designated as the "upper" budget. The "upper^^ budget is quite arbi- trarily fixed at 25 per cent higher than the "intermediate" budget. For the standard budget family of father, mother, an older child and two younger children, where the "subsistence" budget is $850 and the "inter- mediate" budget $1,200; the "upper" budget is, accordingly, $1,500. Families in Class A whose incomes were below the requirements of the "upper' budget are classified in sub-class "A," or families ^iDetter off;" families in Class A whose incomes were above the level of the "upper" budget are classified in sub-class "W" or "families still better off" or "best off," so that they may be spoken of as "well off." The term "well off" is used in a strictly relative sense and signifies "well off" as incomes go in the wage-earning group. In general, however, families 'better off" and those "well off" are grouped together in Class A. An objection may be made that the economic status assigned to many families is likely to be incorrect because reports of incomes in certain cases are too high or too low. The claim is not made that the determination of economic status is correct for each individual family. It is probably erroneous in a few cases of conscious or unconscious over- statement or understatement of wages and of occasional omission, in- tentional or unintentional, of certain sources of income. While, there- fore, not absolutely accurate for all individual families, the assignment of economic status does adequately characterize the relationship of income to need of broad groups of wage-earning families which is sufficient for most of the purposes of this study. The following table shows bv different budget levels both the amount assigned as determined for the standard budget family of five members 190 and the range of budget figures b)^ size of family for each selected type of its composition. BUDGET FIGURES AS DETERMINED FOR THE STANDARD BUDGET FAMILY AND BY LOWEST AND HIGHEST FIGURES ACCORDING TO COMPOSITION OF FAMILIES OF 1 TO 9 MEMBERS. 1 o Subsistence budget figures. Intermediate budget figures. Upper budget figures. Standard budget family. Lowest. Highest. Standard budget family. Lowest. Highest. Standard budget family. Lowest. Highest . 1 2 3 4 5 6 7 8 9 J849.80 $ 296.40 408. 40 520. 40 638. 40 750. 40 856. 40 963.40 1,092.80 1,211.20 $ 340.00 533. 00 726.00 925.00 1,118.00 1,305.00 1,498.00 1,685.00 1,856.00 $1,200 $ 418.60 576. 70 734.90 901. 50 1,059.60 1,209.30 1,367.50 1, 543. 10 1,710.30 $ 480.10 752. 70 1,025.20 1,306.20 1,578.70 51,500 1, 842. 80 2, 115. 30 2,379.40 2,635.00 $ 523.30 720. 90 918. 60 1, 126. 90 1,324.50 1,511.60 1,709.40 1,928.90 2, 137. 90 $ 600.10 940, 90 1,281.50 1,636.80 1,973.40 2,303.50 2,644.10 2,974.30 3,293.80 The distinction between normal and actual economic status. — In relating economic status to the problem of sickness, it is important to make the distinction between normal and actual economic status. Nor- mal economic status is determined by adding to the total actual family income for the year of the study the amount of wages lost by reason of sickness by wage-earners in the family. Actual economic status is de- termined by deducting from the total actual family income the costs of medical treatment. Year of the study. — The year of the study for each family visited was the twelve months ending with the date of the visit. For the charity families the year ended approximately with May 1, 1918, for the block and visiting nurse, cases with July 15, 1918. The unusual character of the year from an industrial standpoint must always be considered in the analysis and interpretation of the data presented in the Family Study. During the year the cost of living steadily rose, but this was more than offset by the favorable industrial conditions. Wages tended to rise, though not as universally as prices. However, in. general, actual incomes in wage-earning families appear to have been larger than in former years, in part because of wage increases, but in greater part because of regularity of work and persistent demand for labor. Unemployment during the year reached a low level. The data drawn from the family studies must be used holding in mind that the year was above normal for wage-earning families. (5) Population and Income Statistics. Before taking up the separate studies in detail, it is desirable to present the population and income data for the families in the block, nursing service and charity studies, relative to their nationality, age, sex, family composition, economic status, and income from wasres and other sources. Table 1 persents family composition by nationality and by size. The total number of families in our three studies is 3,980. The total members of these families is 17,475. The nationality distri- 191 TABLE 1 — ^FAMILY COMPOSITION BY NATIONALITY AND BY SIZE. o u ^a Total number members in families. Size of families by number of members. Nativity or race of head of family. O 6 Eh ^ Eh Block studv 3,048 12,450 106 559 718 609 400 293 178 97 55 15 12 6 United States, white 644 274 243 240 129 204 218 117 522 232 225 304 129 30 6 41 14 9 22 2,385 854 942 917 601 1,017 1 116 488 2,434 798 898 1,550 17 28 6 15 9 .... 3 3 19 5 2 142 105 38 51 14 29 25 11 55 54 35 15 194 61 67 52 19 31 24 32 118 58 62 61 125 34 57 52 26 39 37 27 105 56 51 58 78 18 43 26 16 23 40 22 76 18 40 55 43 15 • 20 19 23 28 39 10 69 13 14 47 21 5 5 11 10 28 30 7 45 7 9 26 10 1 4 11 4 13 10 5 29 7 3 16 13 4 2 3 3 8 6 1 United States, colored Bohemian 2 German Irish 2 1 3 3 2 2 Italian 1 Jewish 1 Lithuanian Polish 16 4 2 Scandinavian Other 11 4 6 2 7 Nursing service study United States, white United States, colored Bohemian 638 138 29 229 68 44 126 1 7 31 10 2 4 3 2 3 22 6 2 8 3 2 4 22 5 '"5 2 3 3 21 5 1 6 1 1 6 11 1 6 3 .... 5 1 1 4 1 German 5 1 2 3 3 1 2 1 Irish Italian 1 1 Jewish 2 2 1 Lithuanian Polish 13 14 26 628 79 62 137 3,475 4 5 2 103 3 3 9 106 '"2 4 113 2 1 4 82 17 5 2 8 4 14 6 1 14 1 10 3 1 — Scandinavian 2 1 1 43 2 4 63 Other 1 64 36 1 10 Charity studv 5 1 United States, white United States, colored Bohemian 115 23 15 69 46 79 39 8 126 27 81 590 128 92 355 211 507 221 41 776 113 441 .... 1 11 5 1 6 7 10 "io 5 11 21 3 4 10 13 8 4 1 20 10 9 24 3 3 15 7 8 10 "is 4 17 22 3 1 10 5 9 10 2 33 3 15 7 1 1 5 1 17 4 '"26 1 7 3 1 2 1 2 7 1 1 11 1 1 .... German 1 1 4 2 Irish Italian Jewish ■"'2 4 7 4 3 7 4 9 Lithuanian Polish 3 Scandinavian Other 7 192 Dution by race and nativity of father is United States White with 888 lamilies and 3,613 members; United States Colored with 327 families and 1,120 members; Poles with 661 families and 3,289 members; Bo- nemians with 264 families and 1,063 members; Germans with 350 fami- nes and 1,501 members; Italians with 292 families and 1,568 memoers; Jews with 279 families and 1,463 members; Scandinavians with 273 lamilies and 973 members; Irish with 189 families and 880 members; and Lithuanians with 125 families and 529 members. Where the fattier IS foreign-bom of other national group the families number 332 with 1,476 members. Nationality has been assigned to the foreign-born by mother-tongue rather than by country of birth. However, except with the Jewish, the nationality will correspond closely to the probable re- distribution in Europe. The average size of the family, with all divisions of the study taken collectively, is 4.4. This is just under the average (4.6) returned for Chicago by the United States Census in 1910. The average size of the family, however, is not uniform for the groups in our different studies. For the families in the blocks the average size is only 4.1, for the nursing service families 5.1, for the charity families, 5.5. Nor is the size of the family uniform by nationality. Arranging nationalities in descending order by average number of members we have: Italian, 5.4; Jew, 5.2; Pole, 5.0; Irish, 4.7; "Other Nationalities," 4.4; German, 4.3; Lithuan- ian, 4.2; United States White, 4.1; Bohemian, 4.0; Scandinavian, 3.6; CJnited States Colored, 3.4. Table 2 exhibits the distribution of the 17,475 members of the 3,980 families by sex and age. With the sex of 422 not reported, the total number of males is 8,342 ; of females, 8,711, or a ratio of 48.9 males to 51.1 females. The 1910 census showed a larger number of males than of females. The smaller ratio of males in our families is to be accounted for in part by the larger number of females in the charity group and by the large number of young men who were in the Army and Navy in 1917- 18 and therefore not included in the study. The age distribution in the charity cases shows a larger proportion of young children and old per- sons than in the block study. Distribution by age in the blocks corres- ponds, in general, to that shown by the United States Census, as indi- cated by the following table: Age groups. . Age group per cent of total population. Chicago— 1910 census. Block study. Under 5 years . . . Under 1 year 5-9 years 10-14 years 15-19 years 20-24 years 25-34 years 35-44 years 45-64 years 65 years and over Age unknown... 14.5 3.3 13.0 9.8 8.0 7.2 17.3 12.9 13.0 (2.4 1.9 193 -4^ a c^ f— ( CO X O T3 IM •^ CO ■^ S 1 V •^ c^ 1-H . ® *^ o (j; b. Ml o . < a CO O CO OS IMt- « CO IM CO CM T}< , 'f CO X 05 ■^ 10 I-H ^-t !N f-H »-t «8 O CO ^H ^^ s^ I— 1 rH ■ •^ 00 -^t^ •5t" C^ (M »-H t- •* CO CM^ lO CO c^ C^J r-H .-H 1-H (N I-H I-H T c^ T-^ 1— t 04 t-1 T-H cc 05 •^ ro lO (M CO 05 a> I-H (N t- in ■* lO 00 03 CO'O (N 1-H CO 1-H 1-H CO »-H f— 1 (N T-K 1— ( iC lO 1 05 c c» c^ C0 05 Tf eor-t CO ■^ 05 CO t^ « t^ CO CO N 1-H I-H •^ CSl-H lO C^(M ■* » CO CO ■^ 05 ■^ CO-H X in CM t~- -r CO CO CO IM o •J-J ■"^ ■^ CO coo CO 05 -"f CO in 1-H t- CM in O) rf in CO (M CO CO < CO -^ t-- CM'1< o « CO CO 05 10 •* 1-- CM 1-H I-H 'Xi 'C ' o CO f-H 7 t~- (N "O ■n T-* Tfl c CO-* CM in t- s ■^ CO 00 ,-110 ■^ cot- ■* X »o ■* cot^ c >-0i-0 1-- CM I-H s o 7 f^ 1— t o ^ii5 >c 05 Tf ^0 r- CM in ■r*l a> "o s 1-H ■n-45 CO •* O) « CO LO t - TfCO 1— 5o t3 T-4 r-l 7 ■^ CO oc co>o r— '3 S 1— t 05 CO oc lO (N Tjl 00 1-H 4< CR (N t- cot- CO CO r- CO CO CO CO OC lO c^ Ot-I iC t-l^ CD 1 o> 0505 (N coco 1-H in CO CM o .-I T-H "* -^ CO t^ •-' CO coo •T" XcO C3 CO -H (M *-H in COM CO t- X CO CO CO cc 30 00 (N ^H 1-H r- coco s •» », (N 1^- T— < CO ■^ 02 CD lOi-H 0: X -H X :3 '^ *— 1 1-H 05 t^ ot- in (MCO 1- X 05 ■* CO CO cs CO . (N.-H T-H 8 (N 00 3C 00 t> l^O •n in 05 O CO C- 05 X itt oc ^ 1-H O-H CO 3S CO coo oc lO CO (N 1-H 1-H . CM 1— ( ■>»< c^c^ 1-H v-4 1-H c^ *— 4 f— ( t>. c r^ 05 in Tf cc "■^Q i t- CO m —1 c5x (N CO CO 0* CO CO C 3J • CO coco ■<«• C-1'-' — H 1—i p-o-^ "5 IM —< 05 c C 03 — •^ CO CO m X O3 00 t--. ^ -- cs ft X 04 -^ in in CO cc t-- r-t-^ S f- -H I-H I-H *« ■s ^ co^r-^"^ oc^oo" 1-H OS iM CS kTco' in 1-H r- r- CO fig 3, > ■> 1 t: "5 1 ■c "O QQ > ^ c/- ■> c •4- c 5 > > Im ) c i & c £ > ■» 2 -*-; 05 c3 c r- K « P ) "■ 2? 2 C Cfl S^H 1 IT > 'I c: c ■1 > 4 a 2 •l cc > 1 -13 H I 194 In two age-groups the proportion of persons in the blocks differ greatly from the Chicago Census percentage. The relative number of children under 10 years of age is markedly higher in our block study. On the other hand, the proportion of persons in the age-group 20 to 24 years is much lower. The figures in Table 2 also present a relatively low number of males in the age-group of 20-24 years which roughly corresponds to the age period of the draft. Table 3 shows size of family classified by economic status in the blocks and nursing service cases. The essentials are presented in the following : Normal economic status. Families in block and nursing service studies. Families in block study. Families in nursing service study. Class A, the better off families Class B (families with meager incomes) Class C (families with deficient incomes) Class D (families with incomes not reported in full) Class O (families " on own account") Class R (families "retired") 3.66 3.61 4.97 4.89 5.90 5.43 4.26 4.24 4.27 4.20 2.34 2.32 4.30 5.58 6.69 5.50 5.0i 2.68 While the average size of the nursing service families is larger than that of block families, the variations by economic status are remarkably similar in both studies. The average size of the "retired" families is small. Table 3 shows that 62 per cent of them consist of one or two members. The average size of families in Class 0, or "on own account/' is 4.2 as compared with 4.1 for all block families, but is considerably higher than the average size (3.6) of families in Class A with the higher incomes and much lower than the average size (4.9) of families m Class B with meager incomes, or the average size (5.4) of families in Class C with deficient incomes. Table 3 presents in great detail the number and proportions of persons in families of different sizes according to economic status. These figures provide more opportunity for analysis than space permits. It is sufficient to call attention to the largest proportion of families accord- ing to number of members with reference to economic status. Com- bining the figures for the block and nursing service studies, the largest proportion of families in Class A (31.4 per cent) consist of three mem- bers; in Class B (23.3 per cent) consist of five members; in Class C (18.0 per cent) consist of seven members; in Class D (29.5 per cent) consist of three members; in Class (17.5 per cent) consist of four mem- bers; in Class E, "retired" (31.7 per cent) consist of one member; in the charity families (18.0 per cent) consist of six members. 195 U2 H < H u o z o o H Q < N i— I Q fa u CO fa I CO CC C^.-i(N^ ■ .... rH fl o ^-Cfe « a ^ H , c« •^i OJ IM C^ l>» t^ COCO -^ ^ lO c T-H © > _« K lO CScOiO^— t 1 CO CC f-i e< . • . o i-H . . • T-t C <» e^ "O o C35 COC^C^ T-H rH «o .fl ^ s W o s M 3 >. 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CO r-4 _l t—i rH t ■^ o OiO (M c^ • CO CO , 3 CO 05 t^ I *^ t^ lO lO C/3 3 o a t « 1— l- GO CO-H O o ■* •^ c^ (N m UO t^ t^ (N (N C-i (M • *— 1 f—* Oj «© e© ^ •31 C^ c^T 3 «& «© t^ CO ■* I-- t^ CD CO w • o o ■* ■«f CO CO o !N (N ■ (N e^ CO CO '^ , 1 PI bj c 0. i • ) • c '1 i o •3 > 1 1 a •- > "^ ' •- >> 3 C _t 3 C ' • > . e^ t^ > T geeai -emp ired. V 03)3 "> S^S: Ret nritv Wa: Self Ret ^^ ^c^ X 1 « 1 o 1 197 -a 3 o c o tH • 1 t^ r-< 05 c CO CO 5S S ; 8 CO f-H ; !5 s a^i r^ t^ a- i-H °i iC • ■«»< 00 °1 • o £^h »-H -H rt OC e^ IM • t~r t^ • CI cs «• ; «» • c fe-5 W9 »» o 03 M en >> CO (MCOOC CO CO • "o CO CC iC (N .a a"" « fe J 3 t^ 1-H CO c-» I^ 1-H 1 CO CO >n 1— 1 CO 1-H «C -H-f. CC CO • CO l^ t^ Oi 3 ft9 Jg" «% '. CO SI ■O 'S M c e3 , »-H CO -^ -^ CO -H (M . 00 1 coo C/i CO lO 3C cs oe^ • (M 1 'O^^ ^ 1 ■rf" 1-H CO ■* Z : CO s§ ^1 «« «^ 02 rt CM CC CO O CO ^ ;^ >o >0 (M X iM r- i-o CO cO § a J o ^ >0 CO a> •^ rj. o o ^ ] - 2 c o -* «00 •* f CO CO C/3 IM 05 i-H i-H «<» «« g 1-H «o o i: o J5?SS o CMOOO S8 Oi CO i-< o ■*-» .X t^ f lO CS CO COtNM 1 a o -^S (=i e ^- o ^ 3 a « o « 00 -rP -^ 'i^^c^'oo to cCOh- 0>_ (M CO'H' cT oT i-T o ■^ 03 !N C^l 1-H 1-H (>) r—* 1— ( ^a>i:og c3 CO 1-H ^ «© Hi S3 ■ . , , o ■3 3 3 g o «e «« §2 < ^ 1-H 1-H , o 1— ( . 1-H CC CO ■3 +J (M •(N >.'; lO 3 3 o a lO ■ in •* ^ ■>*• ro :l§ 1-H ^H c3 ^ a o o 3 c3 < t^ • t^ e^ cs t^a 6 ^ ^ ;z; 1 CT eo«o_ Of, >— ( •3 3 3 o a CO CO 1-^ 1-H t^ K u 1 • 03 «» «« X5 < ^ 1-H If t^ a 1-1 00 C3 "a 1 w 6 1-H ■^ f^ 1-H ^H • 00 coo" > SB coco • 1-H CO i i OC Si • • • • t. "3 CO ^s 1 --S : g5 -^^l • • — s « c< ^^ caxiu. >> o c a> ":; . ^s-i' 1 o 198 The following table shows by economic status the number of families with husband and wife present, and the number with husband or wife or both absent. Total number of families. Number of families with Per cent of Economic status. Husband and wife. Widower. Widow. Neither husband or wife. families with husband and wife. Block study 3,048 2,577 63 360 48 84.5 Class A . 1,687 631 280 110 267 73 304 1,458 563 226 84 217 29 285 38 5 1 4 10 5 164 60 52 21 33 30 18. 27 3 1 1 7 9 1 86.4 Class B 89.2 Class C 80.7 Class D 76.4 Class 81.3 Class R 39.7 Nursing service study 93.8 Class A 132 91 48 2 25 6 628 125 89 43 6 2 5 2 1 2 104 1 94.7 Class B 97.8 Class C 89.6 Class D 0.0 Class 24 4 518 96.0 Class R 66.7 Charity study 4 2 82.5 The proportion of families with both husband and wife is largest in the nursing service study, with 93.8 per cent of the total number; next largest in the block study, with 84.5 per cent of the total number ; small- est in the charity stud}-, with 82.5 per cent of the total number. The small difference between the percentages of disrupted families in the charity and block groups is to be explained largely by the transfer of widows with children to the care of the Funds to Parents Department of the Juvenile Court and to the institutional care of the widowed aged. It seems quite evident that the 304 cases in the nursing service study are not representative of Chicago's wage-earning population in this respect or in regard to the size of the family or to the nationality of the father. The variation in family composition by economic status is interesting. In the block families the largest proportion of families not disrupted by death or desertion of husband or wife is in Class B with 89.2 per cent, followed hy Class A with 86.4 per cent. Class with 81.3 per cent. Class C with 80.7 per cent, Class D with 76.4 per cent, and Class R with 39.7 per cent. The data for family incomes and deficits were worked out in detail. Table 4 presents an analysis of incomes by the industrial status of fami- lies classified as wage-earning, on own account, and retired. The various sources of the family income are separately indicated and income from wages and from business on own account are presented by the amount contributed by individual members of the family grouped as husbands, wives, unmarried males 16 years of age and over, unmarried females 16 199 years of age and over, and children under 16 years of age. A summary table giving totals and averages for family incomes and deficits follows. Type of family. Number Total Total of incomes Number Number number of families of Average of of Amount families reporting families family families families of investi- incomes report- income. without with deficits. gated. and balances. ing com- pletely. deficits. deficits. Average deficit for family with deficit. Block study Wage earning. . . Self-employed... Other Nursing service study Wage earning. . . Self-employed... Other Charity study Wage earning. . . Self-employed... Other 3,048 2,806 $3,713,746 $1,323.50 2,470 336 $66,086 2,708 2,559 3,331,022 1,301.68 2,269 290 44,692 267 191 349,351 1,829.06 170 21 10, 123 73 56 33,373 595.96 31 25 11,271 304 285 357,423 1,254.12 179 106 13,849 273 261 331,011 1,268.24 161 100 12,651 25 20 24,768 1,238.40 17 3 784 6 4 1,644 411.00 1 3 414 628 528 307, 139 581. 70 58 470 118,354 563 474 293,701 619. 62 56 418 101,202 25 21 11,797 561. 76 2 19 4,096 40 33 1,641 49. 73 33 13,056 $196. 68 154.11 482. 05 450.84 130. 65 126.51 261.33 138.00 251. 82 242. 11 215. 58 395.64 Both the detailed and the summary tables will have an interest for special students of the problem of family income quite beyond the field of the present study. While at this point no comment will be made upon the similarities and the contrasts evident in the tables, the data presented here provide the background for an understanding of the general eco- nomic situation of the different groups of families studied. With this introduction to the purpose, scope and methods of investi- gation and to the groups of families studied, we take up the further sections of the study. II. THE BLOCK STUDY. The central part of the Family Study is the survey of all families, predominantly wage-earning, in forty-one blocks in Chicago. Schedules were also obtained from a few other blocks which were not completely canvassed. Inasmuch as the families were taken as reached by the inves- tigators, these were included with the schedules of the blocks completely canvassed. The total number of block families from which schedules were obtained is 3,048 with 12,450 members. The object of this division of the study was to obtain from wage-earning families data upon the extent, the duration and the co st of sickn ess; the nature, the scope and the co sts of m edical care in the_home, at the dispensary and in the hospital ; and the kind and the extent of existin g provision and protection against the risks of JTsabling sickness and death. I The mode of selection and the social statistic^ of the blocks have al- ready been set forth in the introduction. The families studied appear to be not unrepresentative of the wage-earning group in Chicago in distribution by age, sex, natic malit y, com positio n and economic ^ status. In the tables which present the findings of the study in regard to costs, treatment and protection from risks of sickness, the data will be analyzed with reference either to nationality or to economic status. Since it was 200 not feasible for technical reasons to present the data to the reader accord- ing to both nationality and economic status, a table showing variations in economic status by nationality is introduced at this point. A study of Table 5 on the opposite page indicates wide differences in economic status by nationality and will be found of value for reference in connection with later tables. The largest proportion of families assigned to Class A is found among the Scandinavian (70.7 per cent), followed by United States White (62.9 per cent), Bohemian (59.3 per cent), United States Colored (58.4 per cent), German (56.7 per cent), Irish (56.6 per cent), Pole (53.8 per cent), "Other N'ationalities" (52.4 per cent), Lithuanian (50.3 per cent), Italian (37.3 per cent), and Jew .(32.6 per cent). In Class B, with meager incomes, the highest pro- portion of families by nationality is among the Italians (29.4 per cent), followed by the Poles (29.3 per cent), Jews (24.8 per cent), Lithuanians (24.0 per cent). United States Colored (21.9 per cent), "Other N'ational- ities" (21.3 per cent), Bohemians (19.3 per cent), Irish (17.8 per cent), United States White (15.2 per cent), Germans (15.0 per cent), and Scandinavians (10.3 per cent). In Class C, with deficient incomes, the largest proportion in the blocks studied is among the Italians (23.0 per cent), then, Irish (14.0 per cent), Jews (10.6 per cent), Poles (9.2 per cent), United States Colored (9.1 per cent), Germans (8.3 per cent), Bohemians (7.8 per cent). United States Whites (7.3 per cent), "Other Nationalities" (7.1 per cent), Lithuanians (5.1 per cent), and Scandi- navians (4.7 per cent). In Class 0, or the families where the normal breadwinner is working "on his own account," the Jews contribute by far a greater proportion of their families (25.2 per cent) than any other nationality. They are followed by Lithuanians (15.4 per cent), "Other Nationalities" (13.8 per cent), Germans (10.0 per cent). United States Whites (8.4 per cent), Scandinavians (7.8 per cent), Italians (6.3 per cent), Bohemians and Irish (each 6.2 per cent), Poles (4.2 per cent), and United States Colored (3.3 per cent). Although the number of families in Class D, those not reporting family 'income completely, is too small for generalization, ^t is important to note that the highest proportion (5.8) is with United States Colored, and the lowest pro- portion (1.8 per cent) is with the Jews. The number of families in Class R, "retired," is too small to permit of comparisons by nationality. Whether or not the distribution by economic status of the families of different nationalities in wage-earning residential areas of Chicago corresponds to that of Table 5, is of little consequence. What Table 5 exhibits is the relative proportion, distributed by nativity and race ac- cording to economic status, of families visited in the Block Study. Among 'these 3,048 families it is probably safe to say that the Scandi- navian and the United States White are, relatively speaking, well-to-do; that the Italian, Pole, Jew and Lithuanian have approximately one- fourth of their number in meager circumstances; that with the Italian and the Irish about one-fourth and one-seventh of their families, re- spectively, are in poverty ; that in one-fourth of the Jewish families and one-seventh of the Lithuanian families the normal bread-winner is work- ing "on his own account." 201 TABLE 5 — NUMBER AND PER CENT OF FAMILIES IN THE BLOCK STUDY CLASSIFIED BY NATIONALITY AND BY ECONOMIC STATUS. CO 1 O ki 1 Economic status of the family. Nativity or race of the Class A. Class B. Class C. Class D. Class 0. Class R. head of the family. a iz; a 4.S © o © Ph a © o t-l © a © o © Pn Xi © © © a 2 •1^ s All families 3,048 1,687 55.3 631 20.7 280 9.2 110 3.6 267 8.8 73 2.4 United States, white United States, col- ored 644 274 243 240 129 204 218 117 522 232 225 405 160 144 136 73 76 71 59 281 164 118 62.9 58.4 59.3 56.7 56.6 37.3 32.6 50.3 53.8 70.7 52.4 98 60 47 36 23 60 54 28 153 24 48 15.2 21.9 19.3 15.0 17.8 29.4 24.8 24.0 29.3 10.3 21.3 , 47 25 19 20 18 47 23 6 48 11 16 7.3 9.1 7.8 8.3 14.0 23.0 10.6 5.1 9.2 4.7 7.1 26 16 12 10 4 6 4 5 12 5 10 4.0 5.8 4.9 4.2 3.1 2.9 1.8 4.3 2.3 2.2 4.4 54 9 15 24 8 13 55 18 22 18 31 8.4 3.3 6.2 10.0 6.2 6.3 2.5.2 15.4 4.2 7.8 13.8 14 4 6 14 3 2 11 1 6 10 2 2.2 1.5 Bohemian 2.5 German 5.8 Irish 2.3 Italian 1.0 Jewish 5.0 Lithuanian .9 Pohsh 1.2 Scandinavian Other 4.3 .9 202 The data secured upon the problem of sickness in the block study will be presented here under four heads: (1) Sickness among Chicago wage-earners. (2) The cost of sickness. (3) The care of the sick. /' * (4) Existing protection against risks. (.1) Sickness Among Families in Wage-earning Blocks. Sickness as viewed by the Family Study usually denotes disabling illness involving cessation of work or confinement to the house for a period of at least a week. Illnesses of a duration of less than a week, including many minor disabilities, were usually excluded either by the agent in the field or in the editing of the schedules. Exceptions were made, however, in the case of serious shorter illness, as for example, bad tonsils requiring removal, and in other cases, where a physician was called. Moreover, all cases of tuberculosis and serious chronic diseases were recorded whether they resulted in complete disability or not. Table 6 (on the opposite page) presents the incidence of disabling illness analyzed by economic status of the family and by the industrial status of its members as gainfully or non-gainfully occupied. There was disabling sickness in 2,005 or 65.8 per cent of the 3,048 families living in the blocks studied. The variations in the relative number of cases of illness in the families by economic status is significant. Illness appeared in 63.4 per cent of families in Class A with the higher incomes, 73.0 per cent of families in Class B with meager incomes, 76.0 per cent of families in Class C with deficient incomes, in only 56.9 per cent of families in Class "on own account," and in 69.9 per cent of families in Class R "retired." However, when the total number sick is com- pared with total number in the familv, we discover more uniform ratios by economic status in Classes A, B, and C, with the respective per- centages of 28.9, 27.0 and 28.0. The number of persons sick in Class families was smaller (23.4 per cent). The highest proportion of persons sick is found in Class R (42.6 per cent). This seems to indicate that so far as wage-earning families are concerned, i. e. those in Classes A, B, and C, there was practically no difference in the proportion of the members ill although the percentage of families in which there was sick- ness varied directly with the lower economic status. The right half of the table shows relative proportions of families with sickness experience according to the industrial status of its members as gainfully or non-gainfully occupied. The largest proportion of fami- lies in which one or more persons gainfully occupied were sick is naturally found in Class R (100 per cent), followed by Class (47.4 per cent), Class C (45.5 per cent), Class B, (45.3 per cent), and Class A (41.6 per cent). These percentages refer to the proportion of families in which there was illness to total families. Considering only wage-earning families where complete income was reported, or groups A, B, and C, it was found that the number of families in which one or more persons gainfully occupied were sick was in Class A, 625, or 37.0 per cent; in 203 TABLE 6— FAMILIES IN WHICH THERE IS SICKNESS ANALYZED BY ECONOMIC STATUS AND BY THE INDUSTRIAL STATUS OF ITS MEMBERS. 1 a Sickness in the family according to the Families in 5 CO Members industrial status of its members. Families in Families in Families in which there fe sick. which which only members gainfully occupied are sick. which only Economic status of the family. a a O is sickness. Xi a a members gainfully occupied and others members non- gain fully occupied a 3 are sick. are sick. a 3 i^ -«>^ u -M * 4J C 1.^ • a a d d . © X> o Xi o pQ « as a 3 a 3 1 a d a 9 H ^ PUl ^ ^ P^ ^ Pli ;z; Pm ^ PLh Block study 3,048 2,005 65.8 12,450 3,450 27.7 543 27.1 571 28.5 891 44.4 Class A 1,687 631 1,070 461 63.4 73.i) 6,090 3,084 1,763 832 28.9 27.0 263 151 24.6 32.8 362 101 33.8 21.9 445 209 41.6 Class B 45.3 Class C 280 110 267 73 304 213 58 152 51 297 76.0 52.7 56.9 69.9 97.7 1,519 466 1,122 169 1,550 426 94 263 72 710 28.0 20.2 45.8 71 23 35 33.3 39.7 23.0 45 18 45 21.1 31.0 29.6 97 17 72 51 176 45.5 Class D 29.3 Class O 47.4 Class R tOD.O Nursing service study. . 104 35.0 17 5.7 Co 59.2 Class A 132 91 48 2 25 6 628 127 90 48 2 24 6 613 96.2 98.9 100.0 100.0 96.0 100.0 97.6 568 508 321 11 126 16 3,475 271 225 141 5 59 9 1,546 47.7 44.3 43.9 45.5 46.8 56.3 44.5 46 30 17 2 9 36.2 33.3 35.4 100.0 37.5 11 5 1 8.7 5.6 2.1 70 55 30 55.1 Class B 61.1 Class C 62.5 Class D Class O 15 6 95 62.5 Class R 100.0 Charity study 428 69.8 90 14.7 15.5 204 Class B, 252 persons, or 40.0 per cent; in Class C, 116, or 41.4 per cent; in Class 0, 80 persons, or 30.0 per cent. The proportion of wage-earners who were sick to all employed per- sons as compared with similar figures for all persons in wage-earning families is of interest. Of the 11,159 persons in wage-earning families, 3,115 or 27.9 per cent were reported as ill. Of those occupied, 1,222 or 27.3 per cent of 4,474 Wage-earners were reported with disabling sickness, as against 1,893 or 28.3 per cent of 6,685 persons not gainfully occupied in wage-earning families. The number and proportion by economic status, of wage-earners sick to their total number is indicated as follows : Normal economic status. Total number of wage earners. Number sick. Per cent sick. Class A 2,770 937 373 215 160 19 746 273 139 36 27 1 26.9 Class B 29.1 Class C 37.3 Class D 16.7 Class 16.9 Class R 5.3 Total 4,474 1,222 27.3 According to these figures, the proportion of wage-earners sick increased with descent in the scale of economic condition. The pro- portion of wage-earners sick in Class C was over one-third larger than in Class A. This is an interesting result in view, of the fact that the members of the poorer families as a whole showed no excess in the rate of sickness. Perhaps the failure to give attention to cases of actual sickness among non-wage-earners in the poorer families explains the ap- parently contradictory results arrived at. No comparison has been attempted between the relative amounts of sickness among the wage-earners and those working on their own account. As the blocks were selected to be representative of wage-earn- ing families, it is obvious that they would not be typical of the self- employed group. The agents of the Commission in the Block Study report that families with members working on their own account in these blocks are predominantly junk dealers, peddlers, proprietors of small shops in the block, of little or no higher economic standing than their wage-earning neighbors. N"ot infrequently, as where a wage-earner be- comes a small proprietor because of age or inability to stand the regular strain of industry, the economic standing of the family "on own account is lower than for the average wage-earning family. ?? (2) Sickness Costs m Families in Wage-earning Blocks. Sickness costs are of two kinds: direct and indirect. The direct costs are the outlays involving additional family expenditure caused by illness. The cost of medicine, the compensation for the attendance of the physician, expenditures for nursing service, for hospital care, dis- pensary fees, are items which severally, or in combination, are involved in practically every case of illness. These direct costs of sickness are 205 significant in the econoni}^ of the wage-earning family because they are seldom anticipated or included in the budget of expenditure. The indirect costs of sickness are many. Two costs, however, are outstanding, that of the loss of wages consequent upon enforced unem- ployment during illness, and that of reduced earning power because of permanently impaired ph^^sical condition. This lowered productive efficiency of the wage-earner is real but difficult to determine statistically in pecuniary terms. It can be measured in individual cases, but no data exist for computing in dollars and cents the loss to wage-earners and to» society of decreased industrial efficiency caused by illness not completely recovered from. Wage losses from sickness may, however, be readily determined from the rate of pay at the time of leaving work and from the number of weeks ill. The indirect costs of sickness will, therefore, be understood in the following discussion to refer only to the loss of wages caused by sickness. The costs of sickness among wage-earners and their families may be considered separately for the individual and for the family. Illness of the wage-earner involves in general both the direct and the indirect costs of sickness. Sickness of the non-gainfully occupied involves only direct costs. In disabling illness of the "self-employed" indirect losses may often result, but they are not readily ascertainable and have here been left out of consideration. Table 7 shows individual sickness costs according to the industrial status of the person sick, as wage-earner, "self-employed" or non-gain- fully occupied. Of the 3,450 individuals sick, 2,585 reporting sickness costs in full give a total loss from sickness 4)f $184,728, or an average of $71.46 per person ill. Since for wage-earners only are indirect costs of sickness present or ascertainable, the sickness costs will be given separately for wage-earners, for "self-employed" and for the non-gainfullv occupied. The proportion of the sick with illness costs varied significantly. Eleven hundred, or 90.0 per cent, of 1,222 wage-earners; 64, or 65.3 per cent, of 98 "self-employed:" 1,573, or 74.1 per cent of 2,130 non-gain- fully occupied who were sick during the year reported sickness costs. Of the 1,222 wage-earners sick 1,100 had sickness costs; but only 1,019 reporting in full gave the total indirect costs of illness (through wages lost) as $102,962 and the total of direct outlays for sickness as $24,749. This means that to every dollar lost by absence from work be- cause of sickness tAventy-four cents must be added for costs of medical treatment and care. The total direct outlays for sickness for 61 (64 with costs of the 98 sick) "self-employed" reporting in full were $3,037; for 1,505 (1,573 with costs of the 2,130 sick) non-gainfully occupied reporting in full, $53,980. For the wage-earning group a more intensive study was made of time and wages lost and cost of sickness. The results are shown in Table 8. Of the 1,222 sick wage-earners, 937, or 76.7 per cent, lost time on account of sickness; 285, or 23.3 per cent either did not lose as much 206 TABLE 7— INDIVIDUAL. SICKNESS COSTS BY INDUSTRIAL, STATUS OF PERSONS SICK IN THE BLOCK, NURSING SERVICE AND CHARITY GROUPS. Block study. Nursing service study. Charity study. Total number of individuals sick Total number of wage-earners sick Total number of ''self-employed " sick Total number non-gainfuily occupied sick Total number of individuals with sic&iess costs Total number reporting costs in fuU Total costs reported in full Wage-earners — Number with costs Number reporting costs in full Sickness costs Direct outlays Lost wages "Self-employed" — Number with costs Number reporting costs in full Sickness costs (direct outlays) Non-gainfully occupied — Number with costs Number reporting costs in full Sickness costs (direct outlays) 3,450 1,222 98 2,130 2,737 2,585 $184,728 1,100 1,019 $127,711 $ 24,749 102,962 64 61 $3,037 1,573 1,505 $53,980 710 148 10 552 576 555 $35,600 129 125 $16, 780 $ 5,066 11,714 3 3 $35 444 427 $18,785 1,546 602 22 922 708 632 $110,764 501 447 $104, 158 $ 5,530 98,628 6 3 $52 201 182 ^,554 TABLE 8 — LOSS OF TIME AND WAGES CAUSED BY SICKNESS OF WAGE- EARNERS REPORTING COMPLETELY. Block study. Nursing service study. Charity study. Wage-earners— Total number of wage-earners Number of wage-earners sick Per cent of wage-earners sick Number losing more than one week's time because of sickness Number losing less than one week's time Time and wages lost — Number of wage-earners losing more than one week's time and reporting completely Total number of weeks lost from work Total earnings from wages Total wages lost 4,474 1,222 27.3 937 285 901 6,632 $676,087 $107,338 409 143 35.0 116 27 115 737 $93, 986 $12,213 878 602 68.6 494 108 450 7,824 $183,841 $104, 493 207 time as a week or continued at work although ill. Of those away from work for a period longer than a week because of sickness, 901 reported 6,632 weeks and $107,338 in wages lost. This means an average loss of time of 7.3 weeks and an average wage loss of $119.13 (15.9 per cent of wages received) for those making complete reports. A special study was made of the direct costs of sickness as compared with earnings from wages of 685 wage-earners who were sick during the year. They reported for the year a total wage income of $492,883 and a total cost of medical treatment and of medicine of $24,411 or an ex- penditure of 5.0 per cent of earnings from wages to meet the direct out- lays of illness. The average cost ,of sickness so far as direct outlays are concerned for the 685 sick wage-earners making complete returns was $35.64. By reference to the figures presented in Table 7 it is prac- ticable to compare the direct outlays involved in sickness for persons sick by industrial status as wage-earner, "self-employed," or non-gainf uUy occupied, as follows: Industrial status. Number persons sick reporting direct outlays. Direct outlays reported. Average outlay for sickness. Wage earner Self-employed Non-gain fully occupied 685 61 1,505 $24,411.00 3,037.00 53,980.00 *$35. 64 49.79 35.87 * Apparently the cost of a case of sickness so far as direct outlays Is con- cerned is the same for the wage-earner as for the non-gainfully occupied. Up to this point we have considered total and average losses. A pertinent consideration is, of course, the proportion of losses of different amounts. Table 9 presents the number of sick wage-earners losing differ- ent proportions of their wage income. The number of wage-earners who were sick during the year was 1,222, those losing as much as a weeks's time from illness was 937,^ those losing less than a week including those losing no time because of illness was 285. Of the 1,151 sick wage- earners reporting in regard to weeks and wages lost by illness, 250 reported no loss for so long a period as one week, and 901 reported a loss of wage- income for a week or more. Of the 901 who lost wages for a week or more 286 or 31.7 per cent, lost less than 5 per cent of annual earnings; 221, or 24.4 per cent, lost 5 but less than 10 per cent; 82, or 9.1 per cent, lost 10 but less than 15 per cent; 99, or 11.0 per cent, lost 15 but less than 20 per cent; 83, or 9.2 per cent, lost 20 but less than 30 per cent; 46, or 5.1 per cent, lost 30 but less than 40 per cent; 17, or 1.9 per cent, lost 40 but less than 50 per cent ; 52, or 5.8 per cent, lost 50 but less than 75 per cent; 15, or 1.7 per cent, lost 75 per cent or more. The cost of the wage-earner's sickness is only a part, although a major part, of the cost of sickness which he bears. The wage-earner is a member of the family group, and the cost of sickness of its members not gainfully occupied falls upon him. 3 /See Table 8, p. 206. 208 r^ .^ TABLE 9— WAGE LOSSES OF SICK WAGE-EARNERS. Block study. Nursing service study. Charity study. Wage earners — Total number Total number sick Total number reporting weeks and wages lost Number losing percentage of weeks and wages — None* Less than 5 per cent 5 to 9 per cent 10 to 14 per cent 15 to 19 per cent 20 to 29 per cent 30 to 39 per cent 40 to 49 per cent 50 to 74 per cent 75 per cent and over 4,474 1,222 1,151 250 286 221 82 99 83 46 17 52 15 409 143 141 26 41 23 17 10 13 6 2 3 878 602 540 90 40 61 31 39 58 56 29 73 63 • None means that at no one time in the course of the year did the wage- earners lose as much time as six days. Hence among these cases are an unknown number who did lose time and perhaps wages, possibly for much more than a week, but who did not lose as much as six working days consecutively. This same factor should be held in mind in case of those reporting more than one week's lost time, for the lost time reported does not include such losses as proved to be of less than a week's duration. 209 The data on famil}^ sickness costs were tabulated in several different ways in order to answer the following inquiries : (1) What is the range of sickness costs? What is their variation by economic status? (2) What is the relation of average family sickness cost to capacity to bear the burden as indicated by economic status ? (3) ^Yh.8it is the distribution of family sickness costs by specific outlays ? Range of sickness costs by economic status. — The distribution of sickness costs among the families is shown in Table 10. Of the 1,909 block families reporting losses from illness, 978 reported costs less than $50 and 931 reported costs of $50 and over. That nearly one-half of these families had sickness costs of $50 and more indicates the serious financial strain connected with sickness. A careful studv of the table brings out the further fact that regardless of the economic status of the families, or their relative ability to pay, variations in sickness costs are remarkably uniform. Average cost of family sickness analyzed by capacity to carry. — The average cost of family sickness may be derived from the figures presented in Table 11. Seventeen-hundred-forty-four, or 67.1 per cent of the 2,598 block wage-earning families in Classes A, B, and C reported dis- abling sickness. The 1,667 wage-earning families in the block study reporting sickness losses in full had total costs of illness amounting to $163,340, or an average of $97.98. The sickness cost was 8.4 per cent of their wages and 7.5 per cent of their incomes. Of this amount the average per family of direct outlays was $43.03, of lost wages $54.95. Taken by economic status the average sickness cost was for families in Class A for direct outlavs $45.68, for lost wages $57.05, or a total of $102.73; for families iii Class B, for direct outlays $35.84, for lost wages $47.03, or a total of $82.87; for families in Class C, for direct outlays $45.18, for lost wages $62.15, or a total of $107.33. Evidently, families in Class B were in a favorable situation from the standpoint of the average amount of illness costs both in regard to direct outlays and lost wages. Two considerations are probably sufficient for explanation. Class B families are in a more favorable age-group relative to sickness than families in Class C and perhaps also than families in Class A. Then, too, the longer duration of illness in Class C families and the superior pecuniary capacity of Class A families to secure medical treatment re- sulted in comparatively lowered sickness costs in Class B. Of more significance is the fact that the average sickness cost of families in Class C was $4.60 higher than in Class A. In determining the actual weight of this somewhat heavier absolute burden of sickness cost upon Class C families, it is desirable to take into account the capacity to carry sickness costs as measured by average total family income, and by average income from other sources than wages. The average family income of the 1,667 wage-earning families re- turning complete information is $1,297.96. This is approximately $4 —14 H I 210 TABLE 10 — PECUNIARY BURDEN OF FAMILY SICKNESS (DIRECT OUT- LAYS AND LOST WAGES) BY ECONOMIC STATUS. o o Is dia Total number of families with sickness. Number with costs reported. Distribution of family sickness costs. Economic status of the family. d 1 4 >— 1 05 1 CO o g O Block study 3,048 2,005 1,909 978 368 172 106 111 76 39 59 Class A 1,687 631 280 110 267 73 •304 1,070 '461 213 58 152 51 297 1,048 440 179 42 162 38 268 507 233 91 26 96 25 112 213 90 27 3 29 6 49 87 47 20 4 10 4 34 67 16 9 2 11 1 14 57 23 17 5 7 2 22 54 13 6 3 25 6 3 2 3 38 Class B 12 Class C 6 Class D Class 3 Class R Nursing service study 10 9 18 Class A 132 91 48 2 25 6 628 127 90 48 2 24 6 613 121 77 40 2 23 5 408 39 36 26 25 12 5 17 12 3 1 1 42 6 5 2 11 6 8 2 4 3 1 1 11 Class B 1 Class C 3 Class D Class 10 1 99 6 1 51 i . 33 3 2 49 3 Class R Charity study / 43 34 57 TABLE 11— INCOMES AND SICKNESS COSTS OF WAGE-EARNING FAMILIES REPORTING INCOMES AND SICKNESS COSTS IN FULL. Economic status of of family. I © 03 © H © OT Cost of sickness. otal number w earning famili with sickness. —1 Xfl •^ 2 ©;^ d © 3S ;d ■^^ R © P xn «^ 3d Od d o 3 rect utlays. t CO © 03 CO O+J O-w o .:-i " O H H Eh ^ H « h5 Family incomes. 03 O E-t -. © 03 a o © .d Block study Class A Class B Class C Nursing service study Class A..... Class B Class C Charity study . . 1,744 7,294 3,021 1,667 $163,340 $71,733 $91,607 1,070 461 213 3,932 2,182 1,180 1,763 832 426 1,048 440 179 $107,666 36,462 19,212 $47, 874 15,771 8,088 .$59,792 20,691 11,124 265 1,380 637 245 33,497 21,907 11,590 127 90 48 563 506 311 271 225 141 121 80 44 $21,403 8,080 4,014 $13,648 6,388 1,871 $7,755 1,692 2,143 554 3,032 1,412 388 91,308 12,802 78,506 $1,575,496 457, 525 130, 747 311,970 $183, 696 89, 434 38,840 274,050 $1,953,439 $1,399,696 430,623 123, 120 289, 177 $210,329 $168,724 83, 837 36,616 252,547 $175, 800 26,902 7,627 22,793 $14,972 5,597 2,224 21, 503 211 less than the average income of all wage-earning families in the block study.* Marked clifferences appear when comparison is made by eco- nomic status. The average income per family in Class A was $1,503.34, in Class B $1,039.83 and in Class C $730.43. Clearly, then, an average Class C family ^^ith little more than one-half of the capacity (as measured by income) to bear the burden of sickness costs, as the average family in Class A is loaded with a somewhat larger pecuniary loss due to illness. This, however, does not disclose the entire disadvantage of families in Class C when compared with those in Class A. Upon consideration, it is apparent that families with a higher proportion, or larger amount, of income from other sources than wages will be favorably situated with reference to capacity to bear the burden of sickness costs. Income from other sources, unlike wages, is, presumably, undiminished by illness. One-thousand-forty-eight families in Class A reported total income of $1,575,496 of which $175,800 or 11.2 per cent, is from other sources than wages; 440 families in Class B reported total income of $457,525 of which $26,902, or 5.9 per cent, was from other sources than wages; 179 families in- Class C reported total income of $130,747, of which $7,627, or 5.8 per cent, was fl'om othei* sources than wages. While the smaller percentage of income from other sources than wages to the total family income indicates the unfavorable situation of Classes B and C families relative to those in Class A, the actual disadvantage of families in Classes B and C is not apparent until a comparison is made of the average annual income from other sources than wages: families in Class A $167.75," in Class B $61.14, in Class C $42.61. Distribution of family sickness costs hy specific outlays. — Of the 2,203 families in the Block Study with sickness costs, 1,909, according to Table 12, reported them, in full and in detail. Thirteen-hundred- thirty-eight, oi:^70.1 per cent, employed physicians at a total outlay of $60,457, or an average of $45.11 per family; 91, or 4.8 per cent, employed a nurse at a total expenditure of $2,665, or an average of $29.29 per family; 198, or 10.4 per cent, report hospital bills of $11,156, or an average of $56.34 per family; 143, or 7.5 per cent, report dispensary charges of $772 or an average of $5.40 per family; 1,533, or 80.3 per sent, report $24,395 expended for medicines, or $15.91 per family; -^738, or 38.7 per cent, report $96,403' in lost wages because of sickness or an average of $130.45 per family; 221, or 11.6 per cent, report other expenses in connection with sickness totaling $2,721, or an average of $12.31. • Of every dollar of sickness costs, 48.6 cents represented lost wages, 30.4 cents went to services of physicians, 12.3 cents for medicine, 5.7 cents for hospital bills, 1.3 cents to nursing service, 0.4 cents to dis- pensary charges, and 1.3 cents to miscellaneous outlays. An initial conclusion to be derived from an examination of these 'data, and one more likely than not to be confirmed by further study, is that the detailed items do not indicate excessive costs and that there is evidence, if anything, of undor-use rather than of over-use of existing *See p. 199. 212 TABLE 12— DETAILED ANALYSIS OF COSTS OF FAMILY SICKNESS FOR THE BLOCK, THE NURSING SERVICE AND THE CHARITY GROUPS. Block study. Nursing service study. Charity study. Total number of families Number with sickness Number with sickness costs Number reporting costs Total sickness costs of families reporting costs completely Analysis of sickness costs of families with complete reports — Families with expenditure for physician Amount Per cent of total sickness cost Families with expenditure for nurse Amount Per cent of total sickness cost Families with expenditure for hospital service Amount Per cent of total sickness cost Families with paid dispensary treatment Amount Per cent of total sickness cost Families with expenditure for medicine Amount Per cent of total sickness cost Families with lost wages Amount Per cent Families with other sickness cost Amount Per cent 3,048 2,005 2,203 1,909 $198, 569 1,338 $60, 457 30.4 91 $2,665 1.3 198 $11, 156 5.7 143 $772 .4 1,533 $24, 395 12.3 738 $96,403 48.6 221 $2,721 1.3 304 297 283 268 $.39,622 247 $15,377 38.8 96 $2, 167 5.5 60 $4, 828 12.2 105 $505 1.3 242 $4,696 11.9 97 $11,843 29.9 11 $206 .5 628 613 563 408 $99,733 168 $6,650 6.7 8 1146 .1 46 $3,152 3.2 19 $151 .2 210 $4,486 4.5 333 $84,834 85.0 35 $314 .3 213 facilities for medical treatment. The discussion of the care of the sick, however, is the next point to be taken up. In respect to family sickness costs, the data examined indicate first, that where there is sickness, the average burden is just under $100 in Chicago wage-earning families; secondly, that it is higher in Class C than in Class A, and much higher than in Class B ; thirdly, that Class C families are less than three-fourths as able as families in Class B, and not half as able as families in Class A to assume sickness losses. (3) The Care of the Side The costs of the different types of medical care of the sick in the block study have already been presented. The point of emphasis here is upon medical facilities available and utilized by families in wage- earning residence areas in Chicago. Table 13, on ^age 212, offers data upon both paid and free medical service obtained by these families last year. The attendance of physician, nursing service, hospital care, dis- pensary service, medicine are forms of medical treatment to be discussed. Attendance of physician. — The- directory of the American Medical Association reports 5,667 physicians in Cook County September, 1918. Even making allowance for the large number in 1917-18 in the military service of the United States, the number remaining was probably suf- ficient to meet the ordinary sickness demands of the civilian population of the city. Yet of 1,909 families (of a total of 2,005 with sickness) reporting sickness cost, 571, or 29.9 per cent, were without the paid service of an attending physician for disabling illness. In 273 families, the free services of a physician were secured. While a small number of families obtained both free and paid service, it may be stated that in up- ward of 298 families, or 15.6 per cent,^ that the person sick was (unless treated at a dispensary or hospital) without either free or paid attend- ance by a physician. Nursing service. — 'The nursing service at present available to wage- earning families in Chicago is of three types. The first is that of the registered or practical nurse to be obtained at a daily or weekly rate in almost all cases beyond the resources of the wage-earning family. The second is that offered in connection with the industrial policies of the Metropolitan Life Insurance Company and occasionally in connection Kvith benefit provision of other insurance carriers and business firms, by which limited nursing service is provided without cost, or for a nomi- nal sum. The third kind is that of the Visiting Nurse Association or of the field work of the Infant Welfare Society, of the School nurses, of the Municipal Tuberculosis Sanitarium affording limited and special nursing care which, depending upon the organization, is entirely free to all needing care as with municipal institutions, or is free to those un- able to pay and with a small charge to all others. Of the 1,909 families reporting in full in regard to medical care, only 91, or 4.8 per cent, paid for nursing serWce during the year. A somewhat larger number, 122, had free nursing service. At least 1,696, 6 The families with free service are from the total number (2,005) with sick- ness; the families with paid service are from a smaller total (1,909) of those reporting sickness costs in full and in detail. 214 or 88.8 per cent of the 1,909 families with sickness of a week or longer, were without the care of a nurse in the home, either paid or free; and only 198 families had hospitalized cases. While nursing service would not be required in all cases, the number in which it would be desirable is obviously far greater than the number of families securing it. Hospital care. — It is not wise to estimate the proportion of cases of disabling sickness which should be hospitalized. Only 198 families, or 10.4 per cent, had paid for and only 201 families had free hospital care for one or more of its ill members. Few will question that it would have been to the advantage of a number of the remaining 1,510, or 79.1 per cent, of the 1,909 families with disabling sickness, to have had the benefit of hospital treatment during the last year. Dispensary service. — Dispensary! service, of general and special types, is offered by many institutions. The dispensaries of the Munici- pal Tuberculosis Sanitarium make no charge for treatment. The other dispensaries, with few exceptions, limit their services to the poor. More- over, where the family is financially able, they often require the pay- ment of a small admission fee, and' almost always require payment to cover the cost of materials or medicines used. A separate investigation w^as made of dispensary cases in the Family Study and appears else- where as Special Report III. It may be noted here, however, that 143 families, or 7.5 per cent, report payment (usually a nominal fee) for dispensary treatment, and 22 G families report free service at dispensaries. At least 1,540 families, or 80.7 per cent, sent no members to dis- pensaries for treatment. Medicine. — In part, outlay for medicine represents self -medication. Fifteen-hundred-thirty-three or 80.3 per cent of 1,909 families reporting sickness costs in full, had outlays for medicine during the yeaT. This is 195 families more than those securing the paid attendance of phy- sicians. Making allowance on the one hand for the families where medicine was secured free or its cost was included in the bill of the physician, (as is often the case), and on the other to the services of free physicians and of the dispensaries we may conclude that a considerable proportion of families resorted exclusively (during the year) to self- medication. It is not necessary to point out the serious peril that may often be involved in the use of patent medicines or of prescriptions based upon the necessarily faulty diagnosis of laymen. This statistical survey of medical service among block families re- veals partial and inadequate use of existing facilities. What is the ex- planation? Does it lie in economic inability to secure the appropriate medical service? Is it the lack of medical service? Is it the absence of adequate medical provision by the community? Is it the mani- festation of habits of mind and social attitudes peculiar to the group studied? The comparative study of nursing service and of charity fami- lies may throw light upon these questions. (4) Protection Against Bisls of Sickness and Death. Many Chicago families in wage-earning residence areas are now protected to a greater or less degree against the risks of sickness, of 215 accident and of death. Data bearing upon the extent of this protection by insurance or otherwise, and the amount of sickness, accident or death benefit received were secured from • the families visited in the block study. The information obtained in regard to disability insurance was, probably, net as definite, or as accurate as that for life insurance. The housewife was usually the informant and did not always know posi- tively whether or not the husband had health and accident insurance, particularly when it was presumably provided by an establishment fund. Cash benefits received for sickness and accident during the year v.'ere readily remembered and accurately reported to the visitor. The data on life insurance of all types entered upon the schedules are usually complete and correct because of the practice of the agents for the Com- mission of consulting the policies held by members of the family. More- over, as already indicated, they have been checked by competent in- surance men. Health and accident insurance. — Data on disability insurance for rhe families in the block study cover the following points : number of persons insured classified by nationality and industrial status, number of main bread-winners grouped by economic status, the kinds of disability insurance and disability benefits received. Insurance against sickness or against sickness and accident is con- fined, with practically no exception, to persons over 14 years of age. Accordingly, Table 13 shows the disability insurance carried by persons over 14 years of age classified by nationality and by industrial status as gainfully or non-gainfully occupied. In the blocks there are 7,780 persons over 14 years of age. Of these 4,801 are reported as gainfully occupied and 2,979 as non-gainfully .occupied. Of the 4,801 gainfully occupied, 4,456 are wage-earners and 345 are working on their own account. Of the 4,456 wage-earners, 1,055, or 23.7 per cent, were re- ported as carrying disability insurance; of the 345 working on their own account 8^, or 25.8 per cent, were protected by insurance against sickness or against sickness and accident. Of the 2,979 non-gainfully occupied, only 262 or 8,8 per cent were returned as having disability insurance. A comparison by industrial status of the average number of policies carried per person insured and of the weekly amount of disability benefit provided in the policy is of interest. Of the 89 persons working on their own account and with disability insurance, 85 report 123 policies (or membership rights) or an average of 1.45 policies; of the 1,055 wage-earners insured, 978 report 1,126 policies or an average of 1.15 policies;- of the 262 non-gainfully occupied insured, 245 report 272 policies or an average of 1.11 policies. More significant is the average amount of weekly benefit and the number insured for different weekly amounts by industrial status as indicated in the following table. 216 ^ o O z Q < g o H < O > O o pq O p:; Q n. M Q H I— I < o I? m I— I pq < CO pq o 13 .2 a. 3 a c C3 be o Number insured for respective sums per week. •J9A0 pUB q\% CO 1 -e^ • : • f-4 • • 1-H • : : • T-t 'n%-Q\% 1-H . t^ .1-H •CM -1-4 ^ -^ 1.H 1— * ,(M . •6S-et 00 .-( I— ( t^ O lO CO 1-H O M iC 0> Oi M 05 •^ 1-H 1-H 1-4 •"^ rH 1-H I-H • .-H 1-4 J9PUX1 00COO50C -t^ '(NcOt^CS "<»< '-I'-l • • 1-1 CO • • o ■«»< •linj u] Suijjodaj jaqranj^ ^ c^ »o CM -^f (M i-H c^ c^ o "0 r- lO 00 >-H CO ■"»< eS 1-H C •* CO rH CO IM CM t- t- lO 03 1-H CO ■>*< (N 1-H C< CO 1-H rH rH CO CO 1-4 ^ • 1-4 • CO-* •jaqran^ 05 05 ^ t^ I-- 0> CM O 't CO CO -^ M CO CO lO CO CO i>- •^ r^O CO iC CO CO lO 05 OS OCM CO -^ Tfi ■* 1-H CO CO CM CM CM 1-H CM CM ■<»• CM CM CO i-H . ^COi-< ■I-H ^TJ4 3 O o 1 o a o Number insured for respective sums per week. •J9A0 puB ejj ■^ : ; : : . . TJ4 ' ' • I-H •^i$-oi« 00 1 i*""^ ■ CO -I-H '1-H •6«-es iM CO coe^ CO CO CM CM CO OS IC Tfi CO CM 1-H I-H 1-H J9PUX1 1-H i-H •COUO CM ! '. 1 1 ! "" 4 ' : : : •jgauaq Aj>[80Ai JO junomv ■*0 CO CO CO CO CO "^ CM CO O >C CM -^ OS 1-H lO 25 »c CO CO CO 1-H CM >0 CO •iO gl •S8I0I[Od JO jaquinjsi CO CO t^ OS 00 CM OS O 1-H lO CO CO CM Tf< 1-4 I-H 1-H I-H CO •linj ui sutajodaj jaqraii^j S CO CO -00 t^ CM ICO O lO CO ■«*| CM rt i-( rH 1-4 1— ( vH •pajnsui aaqmn^ g 00 CO 00 00 CM»0 O OCOCO «5 CM 1-H 1-H 1-H »— * cs ■* rH •i9quin>j ^ 00,-(C^CO -H CO (M (N IM ■* C^ CO CO »H I-H CO ^o CM CO J2 03 Number insured for respective sums per week. •J9A0 puB 9XJ 00 05 rH Tjl . .,-HCOCOCOI> CM 1-H •■ 1-H \ \ : \ •^T«-OI« 00 CO 00 -ti CO CM ^ 1-H CO O: CO lO CO O 00 CO -I-H I-H CM rt 1-Hi-HCMi-H e^ 1-H 1-H CO ■ •6$-e« i t-- ^ OS 05 IC 00 IC 05 t^ CO CM t^ COi-Hi-Ht^ CO 1-H CO CM -^ »0 CO CO lO •* CO 1-H 1-H 1— t 1-4 CO 1-4 IT CO •9« aapuxi oot^coTfc^eo -t^-^t^c^ CMCM ; "^ 1 * * : : : •jijauaq ^15198 Av JO :junorav CO iCOS CM CO OS O CO CO CO coo OS CO OS CO OS -^ t^ OC CM r^ Q CM OS t-1-HTtCO CMCOcO^O&iO •* OS ..H lOO ss ITS CO CO CO 1-4 •saioiiod JO jaqranjsj CO 1-4 CO COOO CO 00 CO OS CO O CM ^ CO O^OSCO lOCOOCMCMt^ CO 1-4 CM — 4 CM »-H r>. 00 1-H OS CM CO "5 ^osco ^ -Iinjm auTjJodaj J9qran>i 05 I-H 1-1 CO OS 00 CM CM ^ O -^ -^ OS Ot^OS-^ lO CO t^ ^ OS CO »o ^ 1-4 CM >C t^ — 4 OS CM CM ■* ^ t^ CO •pajnsui J9qran^ 1-t CO o 00 »o CM CO CM CM OS (N CO c:s CM OS OS »0 tH »0 CO l^ 1-H O CO CO i-( 1-4 CM 1-H OOSr-lO CO f-l CM CO I-H t^ CO •jaqran^ CO t-- OS CM CO 00 CM ^ O ■*! CO t^ 00 OOCMOOOOOOOM'OO'rJOO O 00 •* CO CO CM CO CO ^ t^ CO CM -^ OS O CM CO ^ Tf 00 CO 1*1 1-H r>- CM 1-H 1-H 1-H to CO CO ■-4i-(CM •paidnaoo iCipM^S i^jox 1-H t^ "0 CO COt^ t^ "O O O CO ^ lO CO -^ O <-H — 4 »H CO CO 1-4 t-- CO CO OS Tt< •>*< -"tl CM CO CO 1-H 00 CO CO •* lO -4 CO OS 00 UO 00 t^ •«}< rH t>. C^ I-H CM 1-4 CO 00 OS ^ »H M •fl J8A0 suosjad IB JOJ, C0C0OOcO0Sl0i*0 t^ 00"!j<-«lCOI^>O OS iC CO CO CO CO >C CO CM CO iC UO t- t-l 1-H ^ t^ 00 "O -*• CM CM CM 00 1-H (N CO CM CO CO 1-4 t^— to CM « t^ Nativity or race of head of family. > •d a CO 5 ) U.S., white U. S., colored... Bohemian German 1 CO • -H Ih I-H Cid oj CO Lithuanian Polish Scandinavian. . . other u > . g : 52 3 S5 > 6 1 u Bohemian German Irish c Is : c CO 13 t-»M J3 y. — o &4 05 •S 1 o 317 « M CC <-< -ti s 05 CO • cc ^ t^ rH i-H f-H • i-H T-H 00 ooo>-HM-^r-io CO Tti W Tt< .-1 •«!< ^ Ol ^ 1-H S5 CO -^ OJ Tt> rt Tf rt (M <-< rH ■*■<»• CO -^ •-< »0 i-H CO 1-1 i-H 1-I031— (C-4t~»5DO5CO-^C0O« IM ,H 1-H lO CO 3C ■»!< O (N »0 t^-H0CCO0O 1-H o 1-H . ,-H -H 1-H . . . .1/5 1 CS o>i-HcocDcO'reoo«oeoos ■^t^i-HC0i-HlO^i-Hi-H»-i (^ iO 05 ^ CO r~ e^ o3 r» 1-H Tjf CO o 00 1-H c^ ,-( oc 05i-< 1-H 8 CO 1-H 1-H -H 5^ ,^ C5 o-^t^iNt^-»tO'^e^o 8 s «0C0C 1-H ® •i.JI 1—1 00 •■H 1-H •-H 1-H ^H ■«fC000cCcOt^5Ot^0CCO»O ooioeo'ocoioi'-iotco 3 • • S fl J 35 '-^- - "i? ^ o c c ■ ■ o ' > 218 Number reporting in full. • Amount of weekly benefit. Average weekly- benefit per person insured. Per cent insured for respective sums per week. Industrial status. Less than $5. $5 to $9. $10 to $14. $15 and over. Working on own ac- count 85 978 245 629 6,643 1,046 7.40 6.79 4.68 12.9 10.9 45.7 72.9 70.3 48.2 9.4 14.1 4.9 4.7 Wage earner 4.6 Non-gainfully occupied 1.2 These data relating to the proportion of persons insured^ the average number of policies, the average weekly benefits, and the distribution by amounts of benefit indicate : (1) That nearly three-fourths of those working on their own account, and over three-fourths of the wage-earners do not report them- selves as protected against the risk of sickness. (2) That over nine-tenths of the non-gainfully occupied over four- • teen years of age are reported as unprotected by insurance against sickness. (3) That the insured among the persons occupied' on their own account are somewhat more favorably situated in the average number of policies, the average weekly benefits, and in the distribution by the . amount of benefits than are the wage-earners. Variations by nationality in the proportion insured indicate that differences in customs and habits of the various immigrant groups in Chicago affect decisively the number of persons insured. The per- centage of those insured against sickness among the 4,456 wage-earners is, as has been stated, 23.7 per cent; the proportion among the national and racial groups is highest with the Lithuanian (51.4 per cent), fol- lowed by United States Colored (44.3 per cent), Scandinavian (28.9 per cent), Pole (27.9 per cent), Bohemian (25.7 per cent), "Other Nationalities" (23.0 per cent), Jew (20.6 per cent), Itcilian (18.5 per cent), German (14.4 per cent), United States White (13.9 per cent), Irish (5.8 per cent). The distribution by nationality of non-wage- earners insured is not markedly different from that indicated for wage- earners. In the group of the non-gainfully occupied the most evident differences by nationality are the small proportion of United States White insured (2.6 per cent) and the still smaller proportions among the Jews (0.8 per cent), and the Irish (0.6 per cent). Quite complete information was obtained in regard to benefit re- ceived from sickness insurance carriers. Table 14 shows a comparison of the disability benefits paid with number of wage-earners sick, number losing wages, and the total amount of wages reported as lost. The total number of wage-earners, 4,474 includes 18 persons 14 years of age or less and is therefore larger than the number of wage-earners over 14 years as given in Table 13. Of the 4,474 wage-earners, 1,222 were sick, of this latter number 937 lost at least one week's wages and 126 received sickness benefits from 133 different carriers. The source of practically one-half (6G) of the disability payments received is found in fraternal 219 TABLE 14— SICKNESS OF WAGE-EARNERS, LOST WAGES AND DISABILITY BENEFITS RECEIVED, BY ECONOMIC STATUS. 1 =8 o t-l © ^ >-> o ® Eh M o i-i a Number losing wages for more than one week. Wages lost. ^ 9. a « Benefits received. ♦Number of sources of benefits received. Economic status. d t, 03 4.^ a < c ^ o 4-» O a a •6 ' B t^a o ..-4 'a ? ^ is » ^ . © a §a 1— t Block study 4,474 1,222 937 906 $107,595 126 125 $6,555 30 14 8 66 15 Class A ; 2,770 937 373 215 160 19 409 746 273 139 36 27 1 143 563 223 108 27 16 555 218 105 15 13 66,241 22, 223 14, 872 1,708 2,551 89 27 8 2 89 27 8 1 5,037 1,187 176 155 25 3 1 1 11 3 7 1 39 20 6 1 1? Class B ?. Class C 1 Class D Class Class R Nursing service study. . . 116 115 12,213 7 7 313 3 1 .... 3 .... Class A 202 130 64 8 3 2 878 76 41 20 4 2 65 31 16 3 1 65 31 16 2 1 $ 7,645 2,648 1,738 152 30 5 1 1 5 1 1 $ 196 99 18 1 1 1 1 3 Class B Class C Class D Class Class R . Charity study 602 494 456 105,438 54 51 2,834 8 13 29 9 * Total number of sources greater than number of persons receiving sick benefits, because in a number of cases one person received benefits from two or more sources. 220 orders. The other sources of payment on account of disability are em- ployer, 30; commercial carriers, 15; establishment funds, 14; unions, 8. Certain significant points are revealed in the following table which is based on the data in Table 14. Number Per Number losing cent Number Per cent Average Average Actual economic of wages wage paid of sick wage benefit status. wage for more earners sick paid loss per re- earners than one week. losing wages. benefits benefits man ceived Per cent of bene- fit of wage loss. A 2,770 937 375 4,474 563 223 108 937 24.8 23.8 29.0 20.9 89 27 8 126 15.8 12.1 7.4 13.4 $119. 35 101. 93 141. 64 118. 76 $56.60 43.96 22.00 52.44 47.4 B 43.1 C 15,5 ♦AH 44.1 • Includes 392 wage-earners in addition to those classed "A," "B," and "C." Important conclusions to be derived from a study of this table are : (1) That while 20.9 per cent of the 4,474 wage-earners lost wages for one week or more during last year, only 13.4 per cent of these received sick benefits. (2) That the average loss of wages was $118.76 and that the average benefit received was $52.44, or 44.1 per cent of the amount lost by the insured wage-earners. (3) That, taking the group as a whole, the disability insurance received was 5.9 per cent of wages lost because of sickness or accident disabling for more than a week. (4) That not only was the proportion of sickness greater (29.0 per cent) in Class C (the poverty group) than in Class B with meager in- comes (23.8 per cent), and in Class A with higher incomes (24.8 per cent), but also the largest average loss of wages was $141.64 for Class C as compared with $101.93 for Class B and $119.35 for Class A. (5) That the average benefit was markedly smaller with wage- earners in Class C ($22) than with Class B ($43.96) and Class A ($56.60), and that per cent of benefit to wages lost was much lower in Class C (15.5 per cent) than in Class B (43.1 per cent) and in Class A (47.4 per cent). Because of the acute economic strain usually resulting from the sickness of the main breadwinner in the family, a separate analysis was made for husbands gainfully occupied. The data indicating number insured, number of policies, and amount of weekly benefit provided are presented in Table 15. Of 2,542 husbands gainfully occupied, 925, or 36.4 per cent, have disability insurance. The proportion with pro- tection against sickness is somewhat higher with wage-earning husbands (those in Classes A, B, C, and D, 36.7 per cent) than with husbands working on their own account (Class 0, 33.3 per cent). The follow- 2-21 TABLE 15— DISABILITY INSURANCE OF HUSBANDS GAINFULLY OCCU- PIED, BY ECONOMIC STATUS. Economic status of the Total number of hus- bands. Num- ber in- sured. Num- ber re- porting in full. Num- ber of policies. Total benefit per week. Number of persons with specified number of policies. family. 1 2 3 4 and over. Block study 2,542 925 858 1,024 $6,065 737 100 17 4 Class A 1,475 559 215 66 227 271 565 219 52 14 75 67 517 212 50 9 70 58 615 241 52 9 107 67 $3,812 1,369 279 42 563 497 436 185 48 9 59 50 66 25 2 14 2 1 Class B Class C Class D Class 7 7 1 1 3 Nursing service study Class A 122 83 43 33 20 9 30 15 9 35 16 10 $297 98 63 25 14 8 5 1 1 Class B Class C Class D . Class 23 421 5 84 4 69 6 70 39 409 3 68 1 i Charitv studv 222 mg table brings out significant facts in regard to the disability insurance carried by 2,315 wage-earning husbands. Economic status of wage-earning husbands. Number. Number insured. Per cent insured. Number reporting amount of insurance. Average amount of insurance per week. A 1, 475 559 215 2,315 565 219 52 850 38.3 39.2 24.2 36.7 517 212 50 788 - t $7. 37 B 6.46 C 5.58 All* 6.98 * Includes 66 husbands not classed as "A," "B," or "C." The chief conclusions to be derived from a study of this table are : (1) That while the proportion of wage-earning husbands insured is 54.9 per cent higher than that of all wage-earners (23.7 per cent as shown above), only 36.7 per cent or not quite three in eight have health insurance. (2) That the heads of families in Class C (the poverty group) where loss of w^ages is followed by the greatest deprivation, are least frequently insured. (3) That the average amount of insurance received per week in case of sickness is considerably smaller for Class C ($5.58) than for Classes B and A ($6.46 and $7.37 respectively). By reference to Table 15 it is found that the difference by economic status in average amount of weekly benefit carried is explained for the most part by the larger proportion of heads of families with two or more policies in Classes A and B than in Class C. At all events, the dis- advantageous situation of heads of families in Class C is apparent. Life insurance. — As shown by Table 16, more than four families in five in the Block Study (2,496 out of 3,048) had one or more of their members protected by some form of life insurance. Of the 12,450 members in these families 7,193 or 57.8 per cent were policyholders. The total number of policies in force was 7,721 and the average benefit provided by the policies (on the basis of the amounts reported for 7,194 policies) was $419.24. Noteworthy differences in protection against the risk of death, both in proportion of families with insurance and in the average amount of death or funeral benefit, appear by nationality and by economic status. In the order of rank by percentage of families with insurance the United States Colored lead (93.8 per cent), followed by Bohemian (88.9 per cent), Polish (88.5 per cent), Irish (88.4 per cent), United States White (85.2 per cent), German (85.0 per cent), Lithuanian (79.5 per cent), Scandinavian (75.4 per cent), "Other Nationalities" (75.1 per cent), Jewish (63.8 per cent), Italian (57.8 per cent). Over against the proportion of families with insurance it is interesting' to note the variations in* average amount of the policy according to the nationality of the head of the family. In po far as protection against the risk o? death is to be gauged by the amount of death benefit, the best protected families are the Bohemian ($577.58), followed by United States White 223 TABLE 16— LIFE INSURANCE OF ALL KINDS FOR FAMILIES IN THE BLOCK STUDY, BY NATIONALITY AND ECONOMIC STATUS. Nativity or race of head family. of c "3 a 03 O cS s S.2 . C3 O o t-l a c3 o o . O C3 3 o C3 'cfl O Eh c3 +;> > o All families United States, white. United States, colored Bohemian German Irish Italian Jewish Lithuanian Polish Scandinavian Other. Economic status — All families Class A Class B ClassC Class D Class O Class R 3,048' 2,496 644 274 243 240 129 204 218 117 522 232 225 3,048 1,687 631 280 110 267 73 549 257 216 204 114 118 139 93 462 175 169 2,496 1,425 537 205 88 200 41 81.9 85.2 93.8 88.9 85.0 88.4 57.8 63.8 79.5 88.5 12,450 75.4 75.1 2,385 854 942 917 601 1,017 1,116 488 2,434 798 898 81.9112,450 84.5 85.1 73.2 80.0 74.9 56.2 6,090 3,084 1,519 466 1,122 169 10,421 2,066 798 860 812 549 627 730 396 2,254 633 696 10,421 5,281 ■2,667 1,114 379 94 7,193 7,721 1,565 710 596 596 463 306 259 249 1,581 419 449 7,193 3,700 1,853 770 281 507 82 1,685 789 616 635 484 311 274 327 1,647 490 463 7,721 i,005 1,948 803 302 577 86 7,194 1,599 701 594 588 462 283 270 246 1,572 448 431 7,194 $3,016,032 $856,355 141,237 343,082 244,895 235,953 114,316 125,574 41,914 555, 674 179,910 177, 122 3,016,032 3,746!$1,750,647 1,834 758 250 528 78 585,262 218,866 115,929 311,031 34,297 $419. 24 $535.56 201.48 577. 58 416. 49 510. 72 403. 94 465.09 170. 38 353.48 401. 58 410.96 419. 24 $467. 34 319. 12 288.74 463. 72 589.07 439.71 QO 24 TABLE 17 — DISTRIBUTION OF LIFE INSURANCE OF FAMILIES AMONG MEM NOMIC Nativity or race of head of family. tn .2 Husbands. n3 E ^ s .2 3 o '2 o 2 S be B 3 o ■#-■ o of po ngam e ii 1-1 ■M b. (-•^ 2 © c © sti ja ,Q s> x> X5 O "3 a a o a M 03 o 3 3 o 3 3 £ H ;z; ^ Pi Z Z 3 3 Wives. i .2^ •o •3 of polic ng amou 2 3 .3 O bl bi •tj ll u."3 © © c © ©1- ja .Q © X5 X5 O a a © © a 3 3 3 3 £ ;z; iz; ^ Z Z 3 d All families U. S., white... U.S., colored . Bohemian German Irish Italian Jewish Lithuanian Polish Scandinavian., Other Economic status- All families Class A Class B.... Class C... Class D . . . Class O . . . Class R . . . 12,450 2,640 1,974 74.8 2,325 2,045 2,385 559 455 81.4 539 485 854 211 185 87.7 208 179 942 200 163 81.5 172 165 917 194 147 75.8 176 155 601 92 79 85.9 96 92 1,017 1-96 91 46.4 93 72 1,116 200 124 62.0 138 134 488 111 75 67.6 144 93 2,434 497 392 78.9 438 389 798 178 128 71.9 176 152 898 202 135 66.8 145 129 12,450 2,640 1,974 74.8 2,325 2,045 6,090 1,497 1,162 77.6 1,374 1,218 3,084 568 427 75.2 486 425 1,519 227 149 65.6 162 145 466 86 65 75.6 75 56 1,122 234 155 66.2 210 187 169 28 16 57.1 18 14 11,551,017 $504, 164 52,363 142, 138 120,101 101,390 66, 613 84,436 16, 108 256, 125 108,691 98,888 2,942 624 266 232 226 119 201 215 115 514 212 218 1,551,017 2,942 $943,243 283,532 99,047 44,057 170,938 10,200 1,620 625 276 101 255 65 1,729! 58. 8 390!62. 5 231 86.8 174|75.0 143 63.3 99 83.2 4723.4 55 25.6 60 52.2 335:65. 2 94 44.3 101 1,729 46.3 58.8 959 59.2 397 63.5 153 55.4 58 57. 4 131 31 51.4 47.7 1,823 414 254 182 147 100 48 55 69 351 102 101 1,675 385 224 177 141 93 41 55 40 333 95 91 1,823' 1,675 1,010 417 157 65 142 32 940 381 142 52 131 29 $793,362 $187,505 47,312 131,958 56, 165 65,896 25,686 25, 108 13,344 170,516 29,377 40, 495 793,362 $437,113 170,334 59,689 30,850 79,021 16,355 225 BERS OF FAMILIES IN THE BLOCK STUDY, BY NATIONALITY AND ECO- STATUS. Unmarried males over 14. Unmarried females over 14. Children 14 an( i under. i to ^ .2 3 • i .2^ ■ i "4 H • • •-! o 3 u • 'rt O 3 Ui • •w^ o 3 iM V .a S o 3 "?> =§ a ■A b 3 V. .2 a 5 3 0) 3 O -1 iii 3 -i 3 3 o o d 3 .-4 — ^ O o 5f o 3 •t-< o oSf O 3 .^4 o »§■ t- u -•^ (_ t- '^ -^^ k. ii -i^ u, u'-3 -«-> u< u ♦J u> ui-rS •tj o o fl ^ © ®T^ ^ • « « 3 © <»t2 3 • XI Xi 3 3 2 S OS 3 3 a> 3 3 2 3 3 ^ «H O M Ah d 0< «^ Oh O h-t m ;« ^Q p p 12; H 05 H ^ o w URAN THE ^ /^ K M M w W H fe ^ W hj hj a ^ taunouiv •jaquiUN: CS 3 •^unomv •jaqmn^i .3 o •mnoiuv •aoquin^ •junouiB Sui -Ijodaj sapjiod JO J^q^In^^; •sapipd JO jaqmniij^ •juao J8J •pajnsm jaquinu i^^bx •^U80 J3J •jaquinu ^bjox •;^unomB Sui^jodaj sapiiod ioquihu \^%o:^ •saioiiod p jaquinu 'i^jox •sei[iujBj JO sp^aq' 6|Bm pajnsuT joquinu jb^oj, •soijimBj JO spBoq a[Bui'j6 jaquinu p^ox •3 o ,05 05 J2; 00 QO <2 CO CO (>« 00 o CO ■«tl CO I-- o o CO o GO o CO to o •I a .03 * t^ OO lO o OC CO lO t^ t^ O CO lO ^ CO CS CO t^ CS escoes es 00 lO o CS CO CCOO XCOt^CSOiCO'^'-lt^-sfOS CC CO CO CSCO ' t^ TjH t^ 05 CS CD O Q CSC ■^10 0*0 10 00 lO X 00 c» lO t^ CS CS CO t^COt>-t^'S'C^CS.— icOi-iCS •^ 1-H 1-H »— I 1-H CS CS CO o «o -^ t^ 00 CS i-HcoooQco>ooo5Lf:o Ol-^iOOOOt— oo-^>c ,— iTfcOiO-^'O'Ct^iOOt^ oit-i-Hcocca5cot^r^-*co •-H 05 CD CO CO CO t^ CO lO CS i-H CO t~ CO 00 00 03 t^ i-O o 00 00 CD t^ lO CO a> 00 lo o> 00 CD •<*< CO CTS o lo ic CS t^ IC »-H O500COO5lCC~-4CSQ'^r^O5 OOCSOcO>C-*OO^cDOsiO rt 1-H CS CS 00 iO t^ 03 •<*< o t^ CS 1-H COCS 1-H CSl^-COCS-* CO -"^ -^ -^ OJ 1-H T-H t^ CO -^l o CO 00 CO -^ coo irj CO Tti 1-H CS CO 1-H OOQOO "OOQiO----- _ ■"fOiOOOt^OOOOiOiO lO < ) o< 1 C < 8 8 i-HlOi— iCOOCSOi-HOO' lO I-H CO I-H CO CS CS 1 CS CO lO o S o 8 CO IC C<) CO 00 •^ CO CO »c ■*■ I-H CO 1-H UO C3 C-iOCSCDCOOQCcOCO ■^es»-Hi-H 1-1 coi— tt-H 00 o o^ CS t^ lO CO CO o t^ CO TT »C 02 CS -^ I-H r-H 00 CS CO CO C^ I-- 00 O r^ CS 00 o Tfi CO 00 t^ O 00 CO -^ CO O ■*! 00 XOCSiHi— ll-H 1— (i-HTJii-H^H CO CS •* O CS CO CO O IC l^ r-H ■^ ic 1-1 CS CSlOCO'<»<-^OOCS-*l-OCOCO esiocot^oocD-^cDot^r^ 000000t^00i**cOcCl^t^cD CS CO 00 CS If CO X 00 CD 00 >C en t^ t^ CD t^ CO csQ-^r^-^oo-*'i-Hi-(cooo cDOt^-focooesr^cx-'T'co TfCSi-Hi-H I-H COi-Hi-H CS CS o O CO t^ CS l^ CSCO -f CD "C CS iJT I-H 1-H CS Tft^OCSi-i'Oi-HTfOOifCO CS i-O O lO c^ t^ • CO l^00lOC<«C0'^ lOCOI^COt^ 000000000005 CD o t^ t- CO CO 00 ■ O O O O O 1 CS CScOOOiOOCCOt^CSlCiC cOC^OOOXOOOOOO iC CS CS rt T-H -H 1-H -* ^ CS CS CD 00 CS lO CS lO • Tf t^ I-H 00 CO • "O iC C^ CS • CS es 1-H o i-HiOI^CS-Hi-lOCi*iiOi-HiO OOt^COOt^COOOlt^CO lOCSi-HrHi-H I-H COi-Hi-H o 1-H -H o r^ OC o -n- O Tf Tf iC O -H CO •* I-H ^ C*< IC CD iC -H CS rf 1-H 1-H CS c^ ^H t^OOOCDCSOCOi-HCOXO r^cs^oooiO-HOOJi-H U0CSCSCS»-It-0 CS CS c» CS I-l :t5 *5 o HH> o3 H.J OQ (U ■<-» G u -o'a en OSa o u xf% trx xfi xj^ xfi xn c« (/3 c/i ya c/a w o3 c3 c3 rt o3 cfl ^-4 ^^ F-^ i~^ ^^ r™« ocoooo 229 families. Nearly all of the insurance of children, for example, is "industrial/^ The average value of insurance policies for all male heads gainfully occupied where the amount of death benefit was re- ported was $732. In the different types of insurance the average amount of the policv was naturally highest with the "ordinary life" ($1,352), followed by"^ fraternal ($769), union ($598), industrial ($526) and other \$4;:6). III. THE NURSING SERVICE STUDY. The families in the Nursing Service Study are a selected group. They were chosen as typical of cases under the care of the Visiting Nurse Association. They are, therefore, not representative of families taken at random from the wage-earning group in Chicago. The data have value because they tend to confirm important results obtained in the Block Study, especially as to the relation between insurance and economic condition. More important, they have a bearing on medical treatment and service, for these families are largely an American group while in the Block Study approximately seven in ten of the heads of families were foreign-born. In size the nursing service family is, on the average, larger than the block family. The age-grouping reveals a higher proportion of young children and of persons from twenty to forty-four. Relatively few of the families have been disrupted by death or desertion of the usual bread- winner. Another characteristic of the nursing service families is, as already suggested, the small proportion with parents foreign-born. They are, in general, a native-born group. The characteristic difference in eco- nomic status between the nursing service and the block families is that a smaller proportion of them are Class A families. The data secured from the nursing service group, as in the case of the block families, will be analyzed under four heads. (a) Sickness in nursing service families. (b) Individual and family sickness costs. (c) Care of the sick. (d) Existing protection against health risks. (1) SicJcness in Nursing Service Families. The method of selecting the cases is responsible for the fact that in 297, or 97.7 per cent of the 304 families, disabling sickness, usually for a week or more, was experienced.® That 710, or 45.8 -per cent, of the 1,550 persons in these families were sick as com'pared with 27.7 per cent in block families is to be explained in the same way. (2) Sichness Costs. Of the 710 persons sick in the nursing service families, 148 were wage-earners, 10 were otherwise gainfully employed, and 552 were not gainfully occupied.^ The sickness costs of the 555 (of 576 total with costs) returning complete reports total $35,600, or an average of $64.1-1: « See Table 6, p. 203, for detailed comparison. ^ -See Table 7, p. 206. 230 per person as compared with an average of $71.46 per person sick in the Block Study. This difference in sickness costs is in direct outlays rather than in lost wages as shown by the fact that 125 of the 129 wage-earners with sickness costs reported an average of $40.53 for sickness outlays and $93.71 for lost wages. The comparative per capita illness loss of wage-earners in block families was $24.29 for direct outlays, and $101.04 for lost wages. For the non-gainfully occupied the average direct sick- ness outlays for 427 reporting completely (out of 444 persons with sick- ness costs) was $18,785, or an average of $43.99. . Table 8^ shows that 143, or 35.0 per cent, of the wage-earners in the visiting nurse study were sick in the course of the year. The correspond- ing, but not comparable, figure in the block study was 27.3 per cent. The average time lost from work by the block wage-earner was 7.3 weeks; by the nursing service wage-earner, 6.4 weeks, a difference of almost one week. The percentage loss of wage on the basis of earnings was, therefore, less for the average nursing service than for the block wage-earner (13.0 per cent and 15.9 per cent respectively) ; but the percentage of direct outlay to wage income for illness was much higher (7.4 per cent and 5.0 per cent,^ respectively). This means that for the block family, the proportion of income expended in sickness costs was 48 per cent larger for the nursing service wage-earner than for the block wage-earner. The disparity in actual, not proportionate, direct outlay was still greater. The average cost of medical service to the sick block wage-earner was $35.64; to the ill nursing service wage-earner, $52.67. In family as well as individual sickness costs, higher expenditures were found with nursing service than block families. The following interesting comparison of the distribution of family costs of nursing service and block families is made from the data in Table 10. • Distribution of family cost . Per cent families with sickness costs. Block. Nursing service. Less than $50 51.2 19.3 9.0 5.6 5.8 4.0 2.0 3.1 41.8 $50 but less than $100 ; 18.3 $100 but less than $150 12.7 $150 but less than $200 5.2 $200 but less than $300 8.2 $300 but less than $400 3.7 $100 but less than $500 3.4 $500 and over , 6.7 This table clearly indicates that there is a larger proportion of fami- lies with somewhat higher costs of sickness among nursing service than among block families. The data presented in Table 11 make it possible to analyze in a more fundamental way this difference in sickness costs in the two groups studied. The average family income (where there was sickness) of the block wage-earning family was $1,297.96, of the nursing service wage- **Pag-e 206. ®A study of 88 wag^e-earners with sickness in nursing service families showed total wag-e earnings of $62,243 and total direct outlays of $4,635. See also p. 207. 231 earning family $1,273.34, and the average sickness costs of the block wage-earning family was $97.98, of the nursing service wage-earning family $136.72. In other words, while the income of nursing service wage-earning families was slightly lower, their illness outlays and losses were 39.5 per cent higher than block wage-earning families. This comparison does not tell the whole story. Although the aver- age of lost wages in the nursing service families was only $47.31 as against $54.95 for the block families, the average of direct outlays for sickness was $89.42 for the visiting nurse families, or over one hundred per cent higher than the average of $43.03 for the block families. It is also significant that with the nursing service families, contrary to block families, direct outlays increased absolutely (and to a smaller degree relatively) with the rise in the scale of economic status. The averages were $42.52, $79.85, and $112.79 for families of Classes C, B and A, respectively. An analysis of the specific forms of direct outlays for sickness throws further light upon the higher cost of sickness with nursing service fami- lies. The average family expenditure was found to be higher than with block families in the amount paid physicians ($62.26 as against $45.11) ; for hospital bills ($80.47 as against $56.34) ; for medicine ($19.40 as against $15.91) ; and for other outlays ($18.73 as against $12.31). The average family outlay was higher in only two items in block than in nursing service cases; in the average amount paid nurses ($29.29 as against $22.57), and in dispensary fees per patient ($5.40 as against $4.81). It is significant that the percentages of families with the differ- ent types of outlay were consistently much higher for nursing service than for block families with sickness for every item except "other out- lays;" for physicians, 92.2 as compared with 70.1 per cent; for nurse, 35.8 per cent as compared with 4.8 per cent; for hospital, 22.4 as com- pared with 10.4 per cent; for dispensary, 39.2 as compared with 7.5 per cent; for medicine, 90.3 as compared w^ith 80.3 per cent; and for other costs 4.1 as compared with 11.6 per cent. For every dollar of family sickness cost 38.8 cents was charged to payment of physicians; 29.9 cents to lost wages; 12.2 cents to hospital bills; 11.9 cents to medicine; 5.5 cents to nursing service; 1.3 cents to dispensary fees; 0.5 cents to other costs. The question why there were, on the average, higher sickness costs with the nursing service than with the block wage-earning family ($136.72 to $97.98)- despite the shorter average duration of sickness (6.4 weeks as against 7.3 weeks in the case of wage-earners) has already been raised but not completely answered. The somewhat larger size of the visiting nurse family as compared with the block family (5.1 as against 4.1) is not sufficient explanation. A minor fact entering into the ex- planation is that these cases included a relatively larger number of cases of serious illness among women and children. Another is that there was a more general observance of American standards. The biggest factor is, however, that the visiting nurse educates the family to a fuller and more adequate utilization of the medical facilities in the community. This is shown by the data relating to both paid and free service. 232 (3) The Care of the Sich. ^^^^^m ^ ^Ye have alread}^ seen that a larger proportion of the visiting nurse than of the block families had paid medical service last year. The per- centage with free service was also much larger for the nursing service group. For example, the percentages^ with free attendance by physicians was 27.6 for the one group as against 13.6 for the other; with free nurs- ing service 36.0 as against 6.1 ; with free hospital care 19.9 as against 10.0; with free medicine 1.7 as against 2.9; with free dispensary treat- ment 31.0 as against 11.3. The smaller proportion of nursing service than block families with- out certain types of service is indicated by the following comparisons i^^ without physician^ except at hospitals or dispensary, none as against 15.6 per cent; without nursing service except at hospital 31.6 as against 88.8 per cent; without hospital care 59.9 as against 79.1 per cent; without dispensary treatment 33.7 as against 80.7 per cent; without medicine 16.8 as against 19.7 {)er cent. H The superior provision in medical treatment for nursing service families was partially due, of course, to the fact that they were all Visit- ing J^urse Association cases, and, therefore, likely to be placed in contact with agencies providing free medical assistance. The extent of their use of medical facilities may be regarded as a rough standard of the minimum provision desirable for other families with sickness. The less general use of medical facilities by the block families may be taken as a conservative index of the inadequacy of existing medical treatment of sickness in wage-earning families in Chicago. (4) Protection Against Risks of Sickness and Death. ^ Insurance as a form of protection against morbidity and mortality hazards is of two general types : disability insurance against risk of sick- ness or accident and life insurance providing for death and funeo'al benefits. Disability insurance. — Of the total number, 797, of persons over 14 years of age^- in the nursing service families, 435 were gainfully occu- pied : 408 as wage-earners and 27 on their own account. Of the wage- earners, 69, or 16.9 per cent, carried insurance against sickness or against sickness and accident. The proportion insured of the smaller number working on their own account was 18.5 per cent. Both these percentages are smaller than the corresponding figures in the Block Study (23.7 per cent of wage-earners and 25.8 per cent of the self-employed). The smaller relative number in nursing service families insured is probablv due to the fact that they represent a relatively Americanized group. Of the 69 wage-earners 59 reported 66 policies (or membership rights), for a few were insured with two or more organizations. The amount of weekly benefit provided in the cases of the 59 wage-earners reporting was for $5 but less than $10 in 37 cases, for $10 but less than $15 in 20 cases, and for $15 or over in two cases. While the number of the nursing service wage-earners insured was small, it is significant to note that the »0/See Text Table, p. 243. "See Table 12, p. 212. "See Table 13, p. 216. 233 proportion in the group with weekly benefits of from $10 but less than $15 was much larger (33.9 per cent) than for those in the block families (14.1 per cent). A smaller relative number were protected by disability insurance for a somewhat higher benefit. Of the 116 wage-earners sick for more than a week, only 7, or ap- proximately six per cent, were reported as receiving benefits totaling $313 or an average of $44.71.^^ These figures stand over against 13.4 per cent of the wage-earners sick in the block studies receiving benefits averaging $52.44. The data thus far presented concern only wage-earners. The follow- ing table has been compiled from data presented in Table 15" to show the extent to which husbands of wage-earning families, upon whom the members are more or* less dependent, were protected by disability in- surance against the risks of sickness and accident: Economic status of husbands. Number. Number insured. Per cent insured. Number reporting amount of insurance. Average amount of insurance per week. A 122 83 43 248 33 20 9 62 27.0 24.1 20.9 25.0 30 15 9 54 $9 90 B 6.53 C 7.00 All 8.48 This table shows the following facts : (a) That while the proportion of "main bread winners" insured is larger than that of all wage-earners (16.9 per cent as shown above), only one-fourth (25.0 per cent) had health insurance. (b) That the percentage insured was much smaller than that of the husbands in wage-earning families in the blocks (36.7). (c) That, as in the block study, those less able to bear the costs of sickness were less frequently protected and for smaller amounts. (d) And that the average amount of the insurance per week pro- vided for benefit was larger ($8.48) than in the case of husbands with health insurance studied in the blocks ($6.98). Life insurance.^— A larger proportion of the 304 nursing service families (273 or 89.8 per cent) as shown by Table 19 than of the block families (81.9 per cent) reported one or more members insured against the risk of death. This is explained, in part at least, by the fact that the Visiting ?^urse Association has among its families served those with insurance with the Metropolitan Life Insurance Company. The total membership of the nursing service families was 1,550 of whom 1,044, or 67.4 per cent, were policyholders. The total number of policies was 1.142, or 1.1 policies per person insured. The average value of the 1,128 policies where this fact was reported was $327.78, or ninety dollars lower than the average amount per policy in the block families studied. This lower average value of the insurance policies is undoubtedly due to the larger proportion of children in the nursing service than in the block 13 See Table 14, p. 219. "See p. 221. 234 TABLE 19— LIFE INSURANCE OF ALL KINDS FOR FAMILIES IN THE NURSING SERVICE STUDY, BY NATIONALITY AND ECONOMIC STA- TUS. Nativity or race of head of family. o Number of fami- lies with insur- ance. Per cent. o C/3 (-1 © ss o © ©t3 fl © Eh Total number of policyholders. Total number of policies. Number of policies reporting amount. Total amount of insurance re- ported. Average amount per policy. All families 304 273 89.8 1,550 1,401 1,044 1,142 1,128 $369,730 $327. 78 United States, white United States, colored Bohemian 129 30 6 41 14 9 22 124 28 6 38 11 5 16 96.1 93.3 100.0 92.7 78.6 55.6 72.7 638 138 29 229 68 44 126 619 131 29 215 53 25 97 472 105 22 174 41 13 53 528 109 24 190 47 15 57 522 103 24 190 47 15 56 177,044 22,607 12,912 61,340 17,261 6,594 18,226 339. 16 219. 49 538.00 German 322.84 Irish 367.26 Italian 439. 60 Jewish 325. 46 Lithuanian Polish 13 14 26 304 10 11 24 273 76.9 78.6 92.3 89.8 79 62 137 1,550 62 45 125 1,401 44 33 87 1.044 44 37 91 1,142 44 36 91 1,128 12,517 13,913 27,316 $369,730 284.48 Scandinavian 386.47 Other 300.18 Economic status — All families $327. 78 1 Class A 132 91 48 2 25 6 125 81 41 2 20 4 94.7 89.0 85.5 100.0 80.0 66.7 568 508 321 11 126 16 535 463 282 10 101 10 402 345 201 10 78 8 457 374 208 10 85 8 454 367 204 10 85 8 $173,982 111,090 47,269 4,388 31,474 1,527 $383.22 Class B 302. 70 Class C 231. 71 Class D 438.80 Class O 370. 28 Class R 190.88 235 families (average size of the family 5.1 and 4.1 respectively) who almost without exception carry the so-called "industrial" insurance for relatively small amounts. The distribution of insurance among families by nationality was practically the same as for the block families so far as could be determined by the relatively small figures for the different groups. By economic status the slighter protection of families in the poverty group is again apparent. Some member of the family was insured in 94.7 per cent of the "better off^^ families in Class A, 89.0 per cent of families in Class B with meager incomes, and 85.5 per cent of the poor families in Class C. In other words^ while one out of seven families was without insurance in Class C, approximately one out of nine was without insurance in Class B, and only one out of nineteen in Class A. Taking the total number of members of the families grouped into these three classes, 70.8 per cent of the first (A), 67.9 per cent of the second (B), and 62.6 per cent of the third. (C) were insured. The disadvantage appears also in average num- ber of policies per policyholder — ^Class A, 1.14; Class B, 1.09; Class C, 1.03. The average value per policy for the three classes was $383.22, $302.70, $231.71, respectively. This means that the average amount of insurance per policyholder was approximately $437 in Class A, $330 in Class B, and $239 in Class C. The distribution of the life insurance among members of the family as presented in Table 20 brings out certain interesting comparisons with the block families. While the adult males were slightly better protected by life insurance in the visiting nurse than in the block families (79.4 per cent as compared with 74.8 per cent for married males and 57.4 per cent as compared with 56.5 per cent for unmarried male adults), women and children were much better insured in the visiting nurse than in the block families (71.0 per cent as compared with 58.8 per cent for married females; 66.1 per cent with 53.6 per cent for unmarried female adults; and 62.9 per cent with 48.8 per cent for children 14 and under). The average value of policies for persons insured in these five groups was $729 for married adult males, $374 for married adult females, $312 for unmarried adult males, $223 for unmarried adult females, $96 for children 14 years and under. Of great significance is the protection against death in the case of male heads of families as shown in Table 21. While of the gainfully occupied heads in the blocks three in four (76.2 per cent), in the nurs- ing service group four in five (80.0 per cent) were insured. The 207 wage-earning male heads insured carried 264 policies ; the value of 253 of these was $181,689, or an average of $718 ($14 less than the correspond- ing figure in the block study). In other words, approximately 80 per cent of the wage-earning male heads of families were insured for an average of about $915 (as compared with $850 for the wage-earning male heads of families in Chicago blocks). The customary marked differences by economic status are again found here. Of the male heads of 105 families with higher incomes, 84.0 per cent were insured for an average of approximately $942.98 ; of 230 TABLE 20— DISTRIBUTION OF LIFE INSURANCE OF FAMILIES AMONG ALITY AND ECO Nativity or race of head of family. OT •i-H I— ( s Husbands. Wives. C9 K rm CO ^ O t3 '3 ;=: o 1 (1 t3 © .He t-i O (0 en •^4 © 3 P- ::5 o aa <3 S o O bc o o C tuC -> (-1 ■•-> ll t- 3 a. o <» a (U ©X3 ct • © © c © ©•;3 XJ J2 o ^ XJ L s © ja X5 © .Q ■'^ b CU S a u s s^ o g £ 3 a a « a 3 c o p^ s ffi 3 s£ 3 3 © 3 3 © Eh ^ ^ Ph z :z^ fc-Tj +J Ui Ur -1-3 l-> k'f^ -^ IM t-. -^ Ui «h'J3 •^^ <£ Ol ci o X2 .O O a o Xi Xi o .Q X! O d ? a a O a a§< o ^ a o ag^ s« £ a o a a& fa fl 3 e d 3 2 S C3 d 3 t « tf p W H CQ M ^ t:^ > Q tf z w O i • . ■ 1 1 CO 1 • > ■ ^H C^ CO 1 CO • ■ • •jaqxun^ T : : : : : : g g : : 8i 588 :88S S SSS : .2 c •lunorav CO If 3 CM CO • >-l CO lO "^^^ CO^OO^t^ • 3~ -h" ■' CM CO CO CC 0« • •^H o CM —I . . ■ CM rH • s *%«*■■ 1 CS CO • • Tj^ ir 5i— ICO •r- Tft^- ••>»> t- • CO O • O • t^ C5 T}< ic lO • : ■0 • O l-l ■limoiuy c CMr-l iCO '00 00 COL--^ .; o • 3 1— t •jaquin^ C ^ TT i-H •!— 1 • • Oi "«■ CO "-I • s ? SS8S :SS :888 § 588 :; 5 : >> c 3 Tf OOOi •OlC -OlOO CO ^t^lfD .C 5 * o a . •jmiomy « r CO (N~^00*" ■'-i"5 •eM>Ct- CO t^-^Tt< .£ _^ * s .s^ a » to CO-H ., — t • § I • c£ 5 C-iO •1-H to • CM »0 CD c£ 3 lO t^ l-O • C ^5 • o •jaqran^ « 3 CO -H C£ 3 CO rt •junouiT? C 5 '-CO -.^CO CS CO lO -05 CO CO c < -H . rt CM 1^ CO OC ?; • c M • o §m:ijodaj c> 1 -^ • C^ ) —I CO S8ioi[od JO jaqtuiix • 'a " !>» ^5 •-£> CO IM CO CD ■ Ol T CO -a IC — 1 00 .J ~ , g •saioipd D CO CM ■* T- i-( . t-H CM 0( C* 3 cos: CO -C 4 >— 1 ■M • o s C3 JO jaquinK c > O OO CN C: r-tCTi .COCOOC . G ; ooc -H .c r. • TJ "iUdO J8tJ c ; -^ -^ Q Oi IT i--^ ic • oJ CO r~ c > -r Ci C^ ' C o • « 3 XQcSocr- lO o • CO oc t^ 0( : oc t^ t^ • t ■ : oc CO d -^ d > OS 02 o s» c O O • O C Q t> ■ t^ d t^ -L "3 • -o OO a i cs> o 0-. • c J5 • T— t rH t-H • »-H 1-H »-H *-* ^ > T-H o m t^ CM l^ O • CO CM t^ C CM • >^ i-H e^ 0? ) lc cr. CO • c O • oe > CM CM . CO ^ J CM 00 -^ • C M • •jaquinu {B^ox e^ 1 I-I CN 1 <-l •junouiB Sutjjodej CO -- CO CO CM CM CM TT-H CD i-O • 35 CO CO t^ r-< ■ rt CM t- U- CC CO . c cox CO -e M ' saiojiod JO jaqmnu ib;o j, C- 1 T— * • ^ •— < » X CM 'S' cocoes CD CO • aa -^ CO X ~. ^ X • c J , X CO CM Tt >— 1 >— 1 • -^ CM oc CO o; CO ■ c -) • •saioitod JO jaqmnu {B^ox (M r-H es / •saiiluiBj JO sptsaq ai^ui 00 CO IC -rC 05 COCM CO ■*! CO • a> o '-< cc H * pejnsui jaquinu i^^oj. CC CO t^ >oe> c -^ l-< , s 2-2 : O Is ; : : : io- : 1 : :«• :.i : Scr M ■(-a -u <3 53 J < ffldoc >« o 02 73 o5 en CO M CO M CO « « 5 B • CO V> to to CO !0 W2 1 ^ c3 ^ c3 c^ ^ 5ooS3o OS Pt>MO»i5 o * I ^ » IJ 239 the 71 with meager incomes, 79.8 per cent, for an average of $889.90; of the 31 with deficient incomes, 72.1 per cent, for an average of $628.81. The number of policies and amount of insurance have been tabulated for male heads by kind of insurance carrier. The number of "ordinary life'^ policies was 57, the amount $56,350; of "industrial" polioies, 92, the amount $38,629; of "fraternaP policies, 69, the amount $59,760; of union certificates of membership providing death benefits, 32, the amount $23,150; of other forms of insurance, 3, the amount $3,800. The largest number of policies, 92, or 36.3 per cent, was industrial. In aggregate amount of insurance the fraternal carriers rank first, closely followed by total amount of "ordinary life insurance," each of which accounts for just under one-third of the total amount of insurance ($59,760 and $56,350 out of a total of $181,689). IV. THE CHARITY STUDY. Like the nursing service families, the 628 charity families constitute a selected group. But the basis of selection is radically different. The nursing service families include not only "the poor," and those who in the emergency of sickness are depressed to the margin of poverty, but also wage-earnings families the majority of which are above the poverty- line. The charity families, on the other hand, all belong to the group of dependents, partially or completely supported by public or private relief. The differentiating characteristics of the charity as compared with the block family grow out of the causes' of dependency. They, too,' are an immigrant group and are therefore not markedly different from the block families in composition by nativity and race. The average size of the family is larger with the charity group, but large size of the family is one of the causes or conditions of poverty. There are a larger proportion of disrupted families, but death or desertion of normal breadwinner is another of the causes of poverty. Then, too, the normal economic status of the majority of charity families is in Class C, because it is easier, as we shall see later, for poor families with deficient incomes than for families with larger incomes to descend the economic scale into dependency. Further facts in regard to the size, distribution by nationality, and family income of the charity family may be found in Tables 1, 2, 3, and 4 in the Introduction.^*^ Comparisons with the block and nursing service groups that are pertinent will be made in taking up the analysis of the data for the charity families under the headings: (1) Sickness among Chicago wage-earners. (2) The cost of individual and. of family sickness. (3) The care of the sick. (4) Existing protection against health hazards. (1) Sickness Among Families in the Charity Group. There are 628 families and 3,475 persons in the charity group. The reason why serious sickness, usually disabling for a week or more, *«Pp. 191-97. appears in 613 families, or 97.6 per cent and with 1,546 peTsons, 44.5 per cent of the entire number, is that only families with sickness experience during the year were selected for study. In the 613 families with sickness, persons gainfully occupied were ill in 518, or 84.5 per cent.^''^ In other words, there were only 95, or 15.5 per cent, of the 613 charity families with sickness in which no person gainfully occupied wa^ sick as compared with a similar percentage of 44.4 for the block group and 59.2 per cent for the nursing service group. (2) Individual and Family Sickness Costs. Of the 1,546 individuals sick in the charity families, 602 were wage- earners, 22 were self-employed, and 922 were non-gainfully occupied.^" Of 708 with sickness costs — less than half of the number sick, 632 re- ported sickness costs in full, giving a total of $110,764 or $175.26 per person. For the wage-earner sickness costs both in direct outlays and in lost wages were higher than for the block and the nursing service group as indicated by the following table. Number wage Total Direct earners sickness outlays Lost wages Group studied. reporting costs per per wage sickness per wage wage earner. costs earner. earner. in full. Block families 1,019 125 $125. 33 134. 24 $24.29 40.53 $101. 04 Nursing service families 93.71 Charity families 447 233.02 12.37 220.65 This table shows the much higher average of sickness costs for the charity than for the block and nursing service families. From Table 8 a more detailed study of comparative sickness losses is possible. Of the 878 wage-earners in the charity group, 602 or 68.6 per cent were sick as compared with a percentage of 35.0 for the nursing service wage-earners, or 27.3 for the block wage-earners. Of the 494 wage-earners losing time because of sickness, 450 reported a total of 7,824 weeks lost or an average of 17.4 weeks. This long average duration of sickness stands out in marked contrast to the 7.3 weeks per block wage-earner ill, and 6.4 weeks per nursing service wage-earner ill. The following comparative table is of interest here. Group studied. • • Wage earners reporting time lost in full. Weeks lost per wage earner. Wages lost per wage earner. Wages lost per wage earner per week ill. Block families 901 115 450 7.3 6.4 17.4 $119. 13 106.20 232.20 $16. 32 Nursing service families : 16.59 Charity families 13.34 i"See Table 6. "See Table 7. 241 This table shows that wages lost were on the average higher for the block than for the nursing service group, and almost two times as much for charity as for the block wage-earner. 'The heavy wage-loss of the charity wage-earner was due to the length of illness not to a higher wage rate for this was lower. Xot only was the average wage loss higher in the case of the charity wage-earner, but his direct outlays for medical treatment were greater than those of the block wage-earner. A comparison of direct sickness costs was made possible by a special study of 685 block, 88 nursing service and 144 charity wage-earners who w^re sick and who made complete re- ports of direct outlays for medicines and medical treatment. The average direct cost of illness for the block wage-earner was $35.64, for the nursing service wage-earner $52.67 and for the charity wage-earner $37.04. The detailed evidence of the high wage losses is shown in Table 9.^® In comparing the charity with the block and nursing service groups it is evident that the number of charity wage-earners tends to remain uniform with the increase in proportion of wages lost, while the number of block and nursing service wage-earners tends to decrease with the increase in percentage of wages lost. Of the 450 charity wage-earners losing a week or more on account of illness, 40, or 8.9 per cent, lost less than 5 per cent of their wages; 61, or 13.6 per cent, lost 5 but less than 10 per cent; 31, or 6.9 per cent, lost 10 but less than 15 per cent of their wages; 39, or 8.7 per cent, lost 15 but less than 20 per cent; 58, or 12.9 per cent, lost 20 but less than 30 per cent; 56, or 12.4 per cent, lost 30 but less than 40 per cent; 29, or 6.4 per cent, lost 40 but less than 50 per cent; 73, or 16.2 per cent, lost 50 but less than 75 per cent; and 63, or 14.0 per cent, lost 75 per cent and over. In family sickness is included not only the cost of illness for the wage-earner but also direct sickness outlays for the members of the family who are self-employed, or not gainfully occupied. Table 10^^ provides the data for the following comparative table for the distribution of costs by increasing amounts of outlay and wage losses because of sickness. Percentage of families assigned to appropriate sickness cost group. Distribution of sickness cost. Block study. Nursing ser- vice study. Charity study. Less than $100 . . 70.5 29.5 14.9 9.1 5.1 3.1 60.1 39.9 22.0 13.8 10.1 6.7 36.8 $100 and over . 63.2 $200 and over 44.8 $300 and over 32.8 $400 and over 22.3 $500 and over . . 14.0 The specific amounts of sickness costs with the family as with the individual were higher among charity cases than among block and nurs- ing service cases. ^^ See p. 208. '^ See p. 210. —16 H 1 242 The high cost of sickness among wage-earning charity families to- gether with their relative and absolute inability to pay comes out most forcibly in a study of Tabl'e 11.^° No wonder that sickness compels appeal for relief when the average total family income is only $706.31 and the average total cost of sickness is $235.33. Comparison of family income and family sickness costs with the block and the nursing service families only sets off the more unfavorable situation of charity families with reference to th*e hazards of illness. The average income of the char- ity family was $706.31 as compared with $882.73 for families in Class C with deficient incomes in the nursing service study and $730.43 for families in Class C in the blocks. The average cost of sickness per wage- earning charity family (with sickness) was $235.33 as compared with $136.72 per wage-earning nursing service family^ or $97.98 per wage- earning block family. That the difference was mainly one of lost wages ($202.34 for charity, $47.31 for the nursing service and $54.95 for block wage-earning family) is apparent when a comparison is made of average direct outlays (only $32.99 for the charity, $89.42 for the nursing service, and $43.03 for the block wage-earning family.) A detailed analysis of the costs of family sickness in the charity group is based upon the statistics presented in Table 12.^^ Of 408 fami- lies reporting sickness costs in full, 168, or 41.2 per cent, • reported an average of $39.58 for attendance of phj^sician; 8, or 2.0 per cent, re- ported an average of $18.25 for nursing service; 46, or 11.3 per cent, reported an average of $68.52 for hospital bills; 19^ or 4.7 per cent, re- ported an average of $7.95 for dispensary treatment; 210, or 51.5 per cent, reported an average of $21.33 for medicines; 333, or 81.6 per cent, reported an average of $254.76 for lost wages; and 35, or 8.6 per cent, reported an average expenditure of $8.97 for other costs of sickness. The average sickness loss for each item was higher in the charity as com- pared with the block families except in expenditure for physician and nurse. In lost wages it was about 100 per cent higher. The proportion of families with the different items of sickness costs was lower for the charity families except for lost wages, (as compared with block families) for hospital treatment, and (as compared with nursing service families) for "other expenditures." Of every dollar of sickness costs for these 408 charity families 85.0 cents was charged to lost wages; 6.7 cents to physician; 4.5 cents to medicine; 3.2 to hospital bills, .3 cent to other outlays, .2 cent to dis- pensary treatment; .1 cent to nursing service. (3) The Care of the SicTc. The most marked difference between the care of the sick in the charity families in comparison with the block and nursing service families is in the larger proportion of free service. The following table indicates the chief types of free service available to the poor of the city, and the number and percentage of families. in the three studies utilizing them. 2«Sce p. 210. 21 See p. 212. 243 Kind of free medical service. Number with free medical service. Block study. Nursing service study. Charity study. Per cent with free medical service. Block study. Nursing service study. Charity study. Total number Physician Nurse Hospital: Medicine Dispensary . . . 2,005 273 297 82 613 247 13.6 27.6 122 107 166 6.1 36.0 201 59 276 10.0 19.9 59 5 80 2.9 1.7 226 92 239 11.3 31.0 40.3 27.1 45.0 13.1 39.0 Except for free nursing, in which naturally the nursing service group has the largest proportion, the charity families had the highest percentage for each of the kinds of free medical service. (4) Existing Protection Against Health Hazards. The charity group is made up of those in greatest need. Charity families sustained heavier burdens of sickness than those in the block and nursing service studies. It is important to ascertain whether these who are least able to bear the costs of illness and death were more or less protected by health and life insurance than families better off econom- ically. Conditions are particularly favorable for this study because of the reliability of the returns on disability and life insurance secured in each instance, both from a visit to the families and from prior con- sultation of the records of charitable agencies. Disability insurance. — ^The smaller number of charity than of nursing service and block families protected by health insurance is ex- hibited in the following table : PERSONS OVER 14 YEARS OF AGE CLASSIFIED BY INDUSTRIAL. STATUS. Wage earners. Self employed. Non-gainfully occupied. Group studied. Num- ber. Per cent with health insur- ance. Aver- age amount weekly benefit pro- vided. Num- ber. Per cent with health insur- ance. Aver- age amount weekly benefit pro- vided. Num- ber. Per cent with health insur- ance. Aver- age amount weekly benefit pro- vided. Block families 4,456 408 859 23.7 16.9 11.6 $6.79 8.46 5.52 345 27 27 25.8 18.5 7.4 $7.40 9.75 5.00 2,979 362 557 8.8 . 5.2 4.8 4.68 Nursing service families.. Charity families 7.17 6.13 The statistical facts here presented show : (1) The relative number of insured persons over 14 years of age in the charity group (no matter what their industrial status) was smaller than among the nursing service families and still smaller than among the block families. (2) The average amount of weekly benefit provided by policies (or membership rights) was less for charity families (regardless of economic 244 status) than for block families and much less than for nursing service families. (3) So far as wage-earners are concerned, only 11.6 per cent were insured for benefits averaging $5.52 a week, as against 16.9 per cent for an average weekly bnefit of $8.46 in the nursing service group^ and 23.7 per cent for $6.79 in the block family group. The relative number insured grouped by nationality of head of the the wage-earning family does not differ markedly from the proportion found in the block study. The proportion insured is highest with the United States Colored and lowest with the Irish. Differences according to the presumable effect of the pressure of poverty are perceived in the small decline in the proportion insured Avith United States Colored, Jew- ish, and German wage-earners, and the great reduction with United States White, Pole, Italian and Scandinavian. . A comparison is offered in the following table^^ of the health in- surance carried by wage-earners within the block, nursing service, and charity groups. Group studied. Num- ber wage earners. Num- ber losing wages for more than one week. Per cent wage earners losing wages. Num- ber paid sick bene- fits. Per cent of sick paid bene- fits. Aver- age loss per man. Aver- age benefit re- ceived. Per cent of benefit of wage loss. Block families Nursing service families Charity families 4,474 937 20.9 126 13.4 *$118. 76 $52. 44 409 116 28.4 7 6.0 106. 20 44.71 878 494 56.3 54 10.9 *231. 22 55.57 44.1 42.1 24.0 * The number of wage-earners reporting completely for the data presented in Table 14 is somewhat larger than the number making complete returns for data in Table 8. Significant facts indicated by this table are : ( 1 ) that the per cent of sick wage-earners paid benefits was smaller with the charity than with the block group (10.9 to 13.4) ; the per cent, however, for the nursing service families was still lower (6.0 per cent) ; (2) that, although the average wage loss of the charity wage-earner was almost double that of the block wage-earner, the average amount of sickness benefit received was only slightly larger ($55.57 to $52.44) and the per cent of benefit received to wage loss of the charity wage-earner (24.0) was slightly more than half that of the nursing service (42.1) and block wage-earner (44.1). Of the 54 wage-earners receiving sick benefits, 51 stated 59 sources. The larger number of these (29) received benefits from fraternal orders, followed by unions (13), commercial insurance agencies (9), and establishment funds (8). 22 This is a summary table based upon data in Table 14, p. 219. 245 A comparison of the health insurance carried by wage-earning husbands with famil^y responsibilities in the charity, nursing service, and block families is given in the following table.^^ Group studied. Number of husbands. Number insured. Per cent insured. Number reporting amount of insurance. Average amount of insurance per week. Block families Nursing service families Charity families 2,315 850 36.7 788 248 62 25.0 54 421 84 20.0 69 $6.98 8.48 5.93 This table shows that the main breadwinner in the charity family had less relative protection against risk of sickness both in the percentage insured (20.0 as against 25.0 with the nursing service and 36.7 with the block groups) and in the benefit provided ($5.93 as against $6.98 with the block and $8.48 with the nursing service main breadwinner). Three tables have now been presented showing by block, nursing service, and charity groups disability insurance for all persons over 14 years of age, all wage-earners, and wage-earning husbands. Obvious differences have been commented on. The contrasts pointed out between the charity and the block families are only those which w^ould be expected in view of the lower normal economic status of the former and the pro- tection health insurance is supposed to give against dependency. It is important to note in this connection the unusually large percentage (63,9)^* of the charity families in Class C. The relatively smaller num- ber insured among those in the lowest economic group (Class C) will be recalled. As already seen, in the block studies 38.3 per cent of the hus- bands in Class A and 39.2 por cent of those in Class B as against 24.2 per cent in Class C had health insurance. With the great majority of the dependent families drawn from Class C (normal status) the most significant thing shown by the tables is that among the de- pendent 11.6 per cent of the wage-earners had health insurance with benefits averaging $5.52 per week, that 20 per cent of the wage-earning husbands had insurance averaging $5.91 per week, and that 10.9 per cent of the wage-earners with sickness during the year had drawn benefits averaging $55.57 — evidently for an average of about 10 weeks in the year. While it may be that for every case of dependency in spite of health insurance carried, another case was prevented, it is obvious that health insurance in the amounts and of the kind carried did not serve as an adequate safeguard against dependency as a result of the disabilities sustained. As will be shown later most of the illnesses resulting in de- pendency were of a chronic type; most of the insurance now provided is limited to a fraction of the year, and is for small sums per week. What- ever might be accomplished in preventing dependency by health insur- ance covering a longer period and paying larger benefits than $5.52 per 23 The data presented are based upon Table 15 p. 221. ^* Supra, p. 276. 24G TABKE 22 — LIFE INSURANCE OP ALL KINDS FOR FAMILIES IN THE CHARITY STUDY, BY NATIONALITY. Nativity of race of head of family. <«-( 5R . 1 o «i-i VH o Vh o m °m O o o Ut II «- h l-i ;=) -M A o ^ ^.S o ft.. otal amoun insurance r ported. •30 umber of lies with ance. © a- otal num policyho] otal num policies. umber of reporting amount. &H Z Pn H H Eh Eh Z Eh a>. I— ( ® o Sfft > ft All families United States, white . United States, colored Bohemian German Irish Italian Jewish Lithuanian Polish Scandinavian Other 628 444 70.7 3,475 115 91 79.1 590 23 21 91.3 128 15 12 80.0 92 69 51 73.9 355 46 36 78.3 211 79 31 39.2 507 39 17 43.6 221 8 5 62.5 41 126 104 82.5 776 27 18 66.7 113 81 58 71.6 441 2,480 471 119 72 265 171 210 101 i 27 6451 75 324 1,720 358 90 47 210 141 96 22 17 444 52 243 1,810 383 98 50 220 151 97 23 19 455 52 262 1,714 380 88 50 205 143 91 20 19 429 44 245 $374,084 $86,978 13,074 15,206 41,583 33, 861 18,385 8,971 4,598 99,605 9,117 42,706 $218. 25 $228. 89 148. 57 304.12 202. 36 236.79 202. 03 448. 55 242.00 232. 18 207. 20 174. 31 247 week, health insurance covering only 24 per cent of wage losses and a smaller percentage of the larger sickness costs does not prevent poverty in a relatively large number of cases. Life insurance. — The following table^^ presents a comparison for the three groups studied of the proportion of families and of persons with life insurance and the average amount of death or funeral benefits per policy and per person. Group studied. Average Average Per cent Total Per number amount Total with in- members cent policies of in- families. surance. of insured. per surance families. person insured. per policy. Average amount of in- surance per person insured (approxi- mately.) Block study Nursing service study Charity study 3,048 81.9 12,450 57.8 1.07 $419. 24 304 89.8 1,550 67.4 1.09 327. 78 628 70.7 3,475 49.5 1.05 218. 25 1449 357 229 The table indicates that the charity families were the least pro- tected in the following ways : ( 1 ) in per cent of families with one or more members insured and in proportion of their members insured; (2) in average number of policies per person; (3) in average value of policy, and in the average amount of insurance per person. The relative numbers by nationality of heads of families with one or more members insured differ, though not markedly, yet quite significantly as indicated by the data presented in Table 22. The order of nationality with reference to proportion of families with life insurance was prac- tically the same as in the block study^^ with the United States Colored at the top and the Italians at the bottom of the scale. The per cent deviation by proportion insured according to nationality of the charity families from the corresponding relative numbers of the block families is important as indicating the degree to which poverty and dependency affect both the foregoing and (when once assumed) the surrender of the protection of insurance. The extent to which the proportion of charity families with insurance was lower than that of the block families with insurance is indicated by the following groups : under 10 per cent lower, United States Colored, "Other Nationalities,^^ Polish, United States White; from 10 to 24 per cent lower, Bohemian, German, Irish, Scan- dinavian, Lithuanian ; from 25 to 35 per cent lower, Jewish and Italian. In this connection it is significant to note that the proportion of families with life insurance was found to be lowest in all three studies with Jews and Italians. 25 Based on data in Table 16, p. ^^ See p. 223. 223 ; Table 19, p. 234; Table 22, p. 246. 248 TABLE 23 — DISTRIBUTION OF LIFE INSURANCE OF FAMILIES AMONG Nativity or race of head of family. a Husbands. Wives a CS OH OH § CO © o o o .S 3 =3a CO o o Xi 3 ft ftCS d ft ft<3 i n U •»H ->j Oh o rof ting OH o 1.^ .|H (H -(-» o rof ting <£> » rt « I-, fl ,? « 0) q a ®1- P! «,• a ® rt <0 «t^ 3 ; 4) <0 3 « X3 .Q O 3 S Xi ,Q © ,Q Xi o 3 d d l-c s ^ ^ Q H >^ H t-i w o OH < M H fa W B S g fa Op §^ n^ 8^ 3^ fa I— I < fa o w P -i i i-Hi-IOJM O O OOOt (N to OiO Q < CO coo »o C0 1-1 Tt< 1-1 CO 00 »o »« Tt< COt^Ot^lN ^ CT> lO lO t>- oo CO 05C< CO OS !N OOCTi .-( o-*co CO rH 1-1 rH(N tH»H CO CM COOJ T-I t» 1— I lO g5 Tj.i-i»o tOOt^i— l>OCOr-(i— I05i— I'f t» 1-t CO oo50or*OTt<.-(ooeoas oot-4 cocsies^ t^i-ico 05oo^»>ccoOJeOl-lcoeo■^ CO 1-1 coc^i-ii-< t^i-ieo C<»OCO> '5 o "3 •n 3 "3 G ES4 1— S BIocls; families Nursing sersdce families 1,908 253 222 10.8 22.5 4.1 30.3 36.4 52.7 49.9 27.3 33.3 6.0 12.6 7.7 3.0 1.2 2.2 $1,396,653 181,689 117,524 19.3 31.0 7:2 20.5 21.3 35.7 53.3 32.9 49.7 4.9 12.7 6.3 2.0 2.1 Charity families 1.1 The groups studied show characteristic differences in per cent of insurance policies carried: (1) The large proportion' of fraternal policies with the block fami- lies is, to a considerable extent, the result of the hold of immigrant societies providing insurance. (2) The much larger percentage of ordinary life insurance with the nursing service families is to be correlated with their more American character. (3) The larger proportion of industrial policies with the charity families means that these are evidentlv the last to be surrendered under the pressure of poverty and dependency. Y. SICKNESS AS A CAUSE OF POA^ERTY AND DEPENDENCY. INTRODUCTION. Sickness is not solely a medical problem, for disabling illness of the wage-earner means unemployment with loss of wages. The high cost of medical treatment and the reduction of income by the sickness of the wage-earner result almost invariably in economic strain and privation, frequently in lowered standards of living, too often in poverty and not infrequently in dependency. This relation of sickness to lowered standards of living, to poverty, and to dependency is a matter of common observation. However, an understanding of the nature and extent of the poverty and the dependency consequent upon sickness requires a survey of large numbers of persons and an intensive study of the effects of specific diseases. To secure as exact information as possible concerning the relation of sickness to poverty and dependency the Commission made a special investigation of this problem. 2» Based on data in Tables 18, 21, 24. 253 The investigation made included five sections, as follows : (1) A brief summary of the literature dealing with the relation of sickness to poverty and dependency. (2) A study of sickness as a cause of dependency in eight Illinois cities outside of Chicago based upon the returns from a questionnaire sent out by the Commission to the superintendents of the various charity organization societies in the State. (3) A study of the relation of sickness to dependency in Chicago and Cook County through an analysis of the data in the annual reports and records of the United Charities, Jewish Aid Society, and Cook County Agent. (4) An analysis of the nature and extent of sickness as a cause of dependency in the 628 charity families of the Family Study. (5) A study of sickness as a cause of lowered economic status and of poverty in the 2,708 wage-earning families in the 41 blocks of the Family Study. (1) A Summary of the Literature upon Sickness as a Cause of De- pendency and Poverty. The three important sources of information bearing upon the problem of the relation of sickness to poverty in the United States are to be found in the investigations of Amos G. Warner, of E. T. Devine, and of the Immigration Commission in its report on "Immigrants as Charity Seekers." Warner in his "American Charities'^ presents the results of his survey of the causes of poverty as found for 1890-92 in the records of charity organization societies in four cities of the United States. He concludes, "Sickness, though not the largest, is the most constant cause of poverty everywhere and at all times, * * * ^^^ according to all investigators.' In both American and English experience the percentage sinks but once as low as 15 and never quite reaches 28, the average being 21. This is one of the most significant facts brought out by these statis- tics and one not anticipated bv the writer when he began collating them."3o Devine in his ^"Misery and Its Causes" presents the results of his inquiry in New York "into the conditions present in five thousand fami- lies who came under the care of the district committees of the Charity Organization Society in the two years ending September 30, 1908." He concludes, "111 health is perhaps the most constant of the attendants of poverty. It has been customary to say that 25 per cent of the distress known to charitable societies is caused by sickness. An inquiry into the physical condition of the members of the families that ask for aid, with- out for the moment taking any other complications into account, clearly indicates that whether it be the first cause or merely a complication from the effect of other causes, physical disability is at any rate a very serious disabling condition at the time of application in three-fourths — not one- fourth — of all the families that come under the care of the Chnrifv *** Warner, American Charities, p. 51. 254 Organization Society — who are probably in this respect in no degree ex- ceptional among families in need of charitable aid."^^ The most extensive survey of dependency in the United States was made in connection with the study of Immigrants as Charity Seekers by the Immigration Commission, 1907-10. The investigation covered all recipients of charity, native as well as foreign-born, receiving assistance from charit}^ organization societies in 43 cities of the United States dur- ing the six months from December 1, 1908 to May 31, 1909. The total number of families furnishing complete data was 31,374. The total number of persons in these cases was 118,299.^^ For each family, in- formation was secured for the apparent cause or causes of need. The apparent cause of need is ascribed to "illness of breadwinnner" in 20.8 per cent of the families, and to "illness of another member of the family" in 17.6 per cent of the cases. If the number of persons in these families is taken as the basis for determining the proportion, we find that the report assigns as a cause of need "illness of breadwinner" in 19.7 per cent and "illness of another member of the family" 'in 21.7 per cent. The addition of the percentages where the cause of need is either "illness of breadwinner" or illness of another member of the family" in order to determine the proportion of families or persons where sickness is the apparent cause of need is not permissible because of the fact that for many of the families more than one cause was reported. The total of the causes of need is fifty per cent higher than the number of cases or of persons involved.^^ That these three studies by Warner, Devine, and the Immigration Commission are not comparable is evident. As the basis of com- parison Warner used the "chief cause" of dependency; Devine analyzed "conditions which accompany destitution" with no effort to deter- mine their relative weight as causes of dependency; and the Immi- gration Commission sought to ascribe dependency to the chief "apparent causes of need." A straight comparison between these studies is there- fore impossible. , Nevertheless a close if not exact common basis may be secured by considering the ratio of the causes and of the conditions ■attributed to sickness to the sum total of the assigned causes and con- ditions of dependency. The following table offers a comparative analysis of the studies by Warner, Devine and the Immigration Commission pre- sented in this way: " Devine, Misery and Its Causes, p. 54. 22 The Immigration Commission, Report, Vol. II, pp. 120-123. 33 Immigration Commission, Report, Vol. II, p. 115. 255 Total Number of families or cases studied. Sum total of all causes or conditions of de- pendency. Number of families or cases in which sickness is (a) "chief cause" (Warner); (b) "con- dition" (Devine); (c) "appar- ent causes of need" (Immigra- tion com- mission.) Percentage where the assigned cause or condition of dependency is sickness. study of dependency. Of total number of cases. Of total causes or conditions. Warner. Study of 7,225 cases from chari- ty organization societies of 4 American cities 7,225 5,000 1,000 31,374 *118,299 7,225 16,944 3,040 26.8 79.5 76.4 / t20. 8 1 :i7.6 / ,tl9. 7 \ ^21. 7 26.8 Devine. Study of 5,000 dependent fami- nes in New York City, 1906-08 Devine. Study of 1,000 dependent fami- lies in New York City, 1906-07 Immigration Commission. Study of char- ity seekers. 31,374 cases 3,876 764 22.9 25.1 } *=^5.5 j **26. 6 Immigration Commission. Study of char- ity seekers. 118,299 persons in these families * Persons. t, t The first percentage (t) refers to "illness of bread-winners" and the second percentage (t) refers to "illness of another member of the family." These per- centages, as explained earlier in the text could not be combined and so are pre- sented separately. ** The Immigration Commission made separate tabulations of families and of persons in these families.; for that reason the percentages for each are given. It is evident from an examination of this table that in all these in- vestigations sickness, whether designated as chief cause, or a cause, or a condition among other causes or conditions, maintains a fairly constant ratio of one in four of the sum total of causes and conditions of de- pendency. One-fourth of poverty of the type of dependency is, then, either primarily the result of physical disability (Warner), or physical disability as an apparent cause of need or a condition accompanying dependency appears once in four times among all causes and conditions (Devine and the Immigration Commission). This lack of uniformity in the methods of study by the three in- vestigators has, at least, one value. The different standpoints repre- sented by Warner, by Devine, and by the Immigration Commission suggest the desirability of determining approximately the extent of sick- ness as a causative factor in poverty (Warner) ; of recognizing that in any given case of dependency or of poverty that sickness may be one of a combination of causes (Immigration Commission) ; and of discovering and of dealing with sickness as a problem in itself as a condition accom- panying poverty and dependency, whether it be as cause, resultant, or coincidence. From the standpoint of the Commission there are, however, serious limitations common to all three studies. Conditions have changed since they were made. The investigations are now all out-of-date; Warner's study was made in the early nineties and those of Devine and the Immi- gration Commission ten years ago. Then, too, their findings are not * 256 necessarily applicable to Illinois and Chicago. Devine's studies were limited to New York. Chicago was not included in the cities covered by the survey of dependency made by Warner. While Chicago was one of the 43 cities selected by the Immigration Commission for its study of "Immigrants as Charity Seekers," the data obtained now have but limited bearing upon our problem. Moreover, all these studies stop at the point where the significant analysis of the relation of sickness to the problem of poverty and dependency should begin. They do not analyze the nature and extent of the economic loss due to the different types of physical disability in correlation with the facts ascertainable concerning the eco- nomic status and standard of living of the family. Finally, the findings of these studies cannot be generalized to exhibit the relation of physical .disability to poverty because they are all confined to the narrow area of dependency. It is unfortuate that for the United States^* we have no statistical evidence of the extent to which sickness enters as a cause into the condition of poverty. Because of these reasons the Commission made a study of the data furnished it by the charity organization societies of eight Illinois cities outside of Chicago and of the reports and records for Chicago of the United Charities, the Associated Jewish Societies, and of the Cook County Agent, and made a further analysis of the data secured in its Family Study from 628 charity families and from 2,708 wage-earning families bearing upon the relation of sickness not only to dependency but also to lowered economic status, to depressed standards of living and to poverty. (2) SicJcness as a Cause of Dependency: the Experience of Eight Illi- nois Cities. Questionnaires were sent out by the Commission to superintendents of the charity organization societies in Illinois cities. Thirteen replies were received. Of these, the returns from eight cities were in form available for tabulation. Table 25 gives the findings of the study setting forth the assigned causes for dependency of 1,464 families in these cities of the State: Blue Island, Champaign and Urbana, Kankakee, Kewanee, Pekin, Quincy, Rockford and Springfield. A comparison of the figures from the different cities indicates at once that the returns are not altogether uniform. Undoubtedly the factor of the personal equation in assigning causes of distress, and probably also, differences in the methods of record-keeping are as much responsible as diversities in local conditions, for the different results. Giving due weight to this fact, certain tentative conclusions may be ventured : 1. Physical and mental disability is assigned as a cause of depend- ency in 50.8 per cent and as the chief cause of dependency (excluding for this purpose the case where "other illness is a contributory cause") in 38.8 per cent of all the families reported. 2. Physical and mental disability, excluding injury from accident, is assigned as a cause of dependency in 45.7 per cent, and as the chief ^*For Engrland, there are the studies by Charles Booth and by Seebohm Rown- tree. See Booth. Life and Labour of the People of London, Pauperism and the Endowment of Age, etc. Rowntree, Poverty: A Study of Town Life. 257 TABLE 25— CAUSES OF DISTRESS IN DEPENDENT FAMILIES FOR THE YEAR 1917-18 FOR ILLINOIS CITIES OUTSIDE OF CHICAGO (AS RE- PORTED BY CHARITY ORGANIZATION SOCIETIES.) • •6 o ft « •1— 1 •t-t O a c! ■s Number of families where physical or mental disa- bility is the assigned cause of distress. -a fl s> 03 O tiysical Id age. Physical disability other than accident. 03 CO 03 § Total physical and mental disability. Cities outside of Chicago reporting in full. 1 3 EH Chronic diseases other than tuberculosis. Other illnesses. "3 O 03 C/3 .^^ m Sole or most important cause. O 5« Blue Island 437 98 65 31 52 132 223 426 57 11 3 5 4 5 37 43 107 11 2 12 8 7 13 21 30 10 4 5 16 14 26 94 23 9 2 '""'24 24 258 75 24 21 19 28 88 114 5 3 5 2 1 7 6 13 28 8 9 9 20 291 86 38 23 20 35 103 147 6 12 20 5 2 8 15 19 140 Champaign and Urbana Kankakee 7 Kewanee 3 Pekin 30 Quincy 89 Rockford 105 Springfield 260 Total 1,464 100.0 165 11.3 181 12.3 105 7.2 176 12.0 627 42.8 42 2.9 74 5.1 743 50.8 87 5.9 634 Per cent 43.3 —17 H I 258 cause of dependency (excluding again the cases where "other illness is a contributory cause'') in 33.7 per cent of all the families reported. 3. Physical disability, excluding injury from accident, is assigned as a cause of dependency in 42.8 per cent, and as the chief cause of de- pendency (excluding again the cases where "other illness is a contribu- tory cause") in 30.8 per cent of all the families reported. 4. In the group of physical disability other than injury from acci- dent as the assigned cause of dependency, chronic disease other than tuberculosis is reported for 181 cases; acute illness as a contributing cause for 176 families; tuberculosis for 165 families and acute illness as the sole or most important factor in 105 families. As stated 'in the introduction to this study, all findings^ for the year 1917-18 must be interpreted with reference to its unusual economic conditions. For example, the studies referred to in the literature are in general agreement that one-fourth of all the causes or conditions of dependency are attributable to physical and mental disability other than injury from accident; the Illinois study reports physical and men- tal disability other than injury from accident as the chief cause of dependency in one-third of all. cases. The larger proportion shown in this study is probably due not so much to local variations in Illinois as to the year of the study and the influence of other factors. Two infer- ences may perhaps be suggested: (a) that economic prosperity has a greater effect in reducing dependency from other causes than from physical and mental disability, and (b) that within the field of disease, the dependency from acute illness is more rapidly diminished than that which results from chronic illnesses such as tuberculosis and rheuma- tism. These inferences, while probably not unfounded, cannot be accepted as fact upon the basis of the statistics of dependency for one year. In order to determine as definitely as possible the changes over a period of years in the relation of sickness to dependency, the Com- mission made a study of the annual reports and records of three Chicago charitable agencies, namely, the United Charities, the Cook County x^gent, and the Jewish Aid Society. (3) A Study of the Changes in the Relation of Siclcness to Dependency During an Eight Year Period From the Data of Three Chicago Charitable Agencies. The eight charity years, 1910-1918, were selected by the Com- mission for a study of the changes in the relation of sickness to depend- ency as shown by the data in the annual records and reports of the United Charities, the Jewish Aid Society, and the Cook County Agent. The charity years signifies the fiscal and statistical year of each organi- zation. The charity year for the United Charities is from October 1 to September 30; for the Cook County Agent, December 1 to November 30; and for the Jewish Aid Society, May 1 to April 30. Because of radical changes in the method of record-keeping, introduced independently by each organization during 1909 and 1910, it was decided that it was impracticable to begin the study earlier than the charity year 1910- 1911. Table 26 presents by charity year for the three relief organiza- 259 TABLE 26 — CHANGES IN THE RELATION OF SICXNESS AS A CAUSE OR PROBLEM OF DEPENDENCY (AS SHOWN BY THE RATIO OF PHYSI- CAL AND MENTAL DISABILITY AS A CAUSE OR PROBLEM TO ALL OF THE CAUSES OR PROBLEMS OF DEPENDENCY FOR THREE CHI- CAGO CHARITABLE AGENCIES FOR EIGHT CHARITY YEARS, 1910-18.) Charity year. 1910-11 . 1911-12. 1912-13. 1913-14. 1914-15. 1915-16. 1916-17. 1917-18. Total number of "problems" (U. C.) or ''chief causes" (C. C. A. and J. A. S.)of dependency. el o =3 -4-> o Total number of cases where phy- sical and mental disabihty is assigned as prob- lem or chief cause of dependency. 14,215 18,983 16, 246 21,932 32,060 18,614 13,601 12,041 1910-18 147,692 10,654 12,635 9,487 11,867 17,253 9,356 8,527 6,714 86, 493 >> *^ p. o • o-S o «* O 1 wo Physical and mental disability per cent of total number of problems or chief causes. <0 o '^ o 1-1 2, 136 2, 362' 2,113i 3,056 4,034 2,688 1,937 1,715; 6,552 8,195 7,674 7,743 8,717 8,066 6,705 5,647 20,04159,299 Unemployment per cent of total number of problems or chief causes. wO >» 4^ ^ s 5? o * C o U* O 2,276 830 46.1 21.4 38.8 17.5 2,408 785 43,2 19.1 33.2 20.3 2,363 884 47.2 24.9 41.8 11.8 2,133 985 35.3 18.0 32.2 28.8 2,289 1,232 27.2 13.2 30.6 40.9 2,862 896 43.3 30.6 33.3 18.2 3,327 886 49.3 39.0 45.7 8.1 2,475 812 46.8 36.9 47.3 6.3 20, 133 7,310 40.2 23.3 36.5 22.3 21.7 29.5 18 38 51, 21, 5.7 4.7 27.8 16.7 25.4 17.0 35.1 44.1 30.8 10.3 10.4 26.8 260 tions, (a) the total number of families cared for, (b) the number of families where physical and mental disability was a "chief cause" or "problem'' of dependency, (c) the ratio of the cases where physical and mental disability was a cause or problem to the sum total of causes and problems of dependency, and (d) the percentage of the cases where unemployment was a cause or problem. In analyzing the figures in this table certain points in regard to the record-keeping of the different organizations should be clearly understood. (a) The difference in the months covered by the charity year is not serious for our purpose, since the six months from October to April provide the great body of applications for relief. (b) The three charitable agencies are not uniform in their inter- pretation of sickness or other conditions as related to dependency. The United Charities considers sickness and other conditions not as "causes'' but as "problems" connected with dependency. Therefore, the total number of the "problems" entering into dependency is, as indicated by the table, somewhat larger than the total number of cases cared for. The Cook County Agent and the Jewish Aid Society assign sickness and other conditions as the "chief cause" of dependency. The "chief cause" as given by the Cook County Agent is the one assigned at the beginning, as given by the Jewish Aid Society, the one assigned at the end of the statistical year. It should be noted here that for the two charity years 1910-12, the Jewish Aid Society reported as the "chief causes" the causes assigned at the beginning of the year together with causes of dependency as they changed during the year. Because of this lack of uniformity in the record-keeping of the different agencies, a basis of comparison is found in the ratio of sickness as a "problem" or "chief cause" to all the assigned "problems" or "chief causes" of de- pendency. (c) In the classification of conditions assigned as "causes" or "problems" of dependency there are, as would be expected, certain varia- tions in the practice of the agencies. In general, however, the system of case-counting is quite uniform. In only two instances is the diverg- ence great enough to be taken into account in the comparative use of the figures. Since the United Charities is the only one of the three agencies to enter "maternity" as a condition of dependency, it was excluded in arriving at the sum total of cases where physical and mental disability was assigned as a "problem" of dependency. Inasmuch as maternity is reported during the period of the eight charity years, as a problem in about one-tenth of the total number of problems, its inclusion as sickness would add an absolute 10 per cent to the percentage of physical and mental disability as a factor entering into dependency. Much more difficult from the standpoints of classification is the wide difference in the inter- pretation of "insufficient earnings" as a condition of dependency. With the United Charities ascribing only 4 to 6 per cent, the Jewish Aid Society 10 to 20 per cent and the Cook County Agent uniformly 25 per cent of the total of conditions and causes of poverty to "insufficient earn- mgs," it is obvious that the relative ratios assigned to other factors must be correspondingly affected. The low proportion of cases in the United 261 Charities where "insufficient earnings" is reported as a problem is due to its strict construction of the term. The chief statistician informed the investigator for the Commission that cases were assigned to this cause only where earnings were markedly below the current rate of wages or where the size of the family was larger than could be supported by the existing wage-scale ; in all other cases the underlying cause of insufficient earnings was determined and the case counted under that condition. The high pioportion of cases ascribed by the Cook County Agent to "insuffi- cient earnings'' is, on the other hand, undoubtedly due to a liberal con- struction of the term. Investigators for the Commission in reading over one hundred of the original records of cases applying to the County Agent for relief came to the conclusion that the phrase "insufficient earnings" was employed as an omnibus term, including conditions not only where earnings were below the current standard, or inadequate for families of large size, but also where physical disabilities of various types or personal and moral deficiencies or other factors lay back of the assigned cause. Although there was no feasible basis for the correction of this difference in classification, it is apparent why the percentages of physical and mental disability for the Cook County Agent are lower than for the United Charities or for the Jewish Aid Society. (d) The validity of the procedure of assigning causes, and par- ticularly chief causes, of dependency and poverty has been called into question. One of the objections raised is that since the assignment of cause is worth no more than the opinion of the person making it, (par- ticularly in the field of poverty and dependency) the factor of the per- sonal equation will render unreliable the data secured in this way. A second criticism is that inexperienced social workers are prone to report too often the apparent cause of dependency which in most cases, is not the fundamental cause. A third, and probably the most cogent, stricture is that the cause of poverty and dependency are complex and that any attempt to assign a chief cause is futile. While much may be said in support of all three of these objections, it is in point to state that they apply probably with less force to sickness than to the other conditions or causes of dependency. The development of medical service in connec- tion with the work of the charities has made the report of the diagnosis of disease and of the physical examination by the physician an indispens- able part of the records. Then, too, the elevation of standards and the rapid trend toward the professionalization of social work has removed much of the forces of the objections stated above. With this background for understanding the nature and differences in the record-keeping of the three charitable agencies, certain generaliz- ations may be suggested from the data presented in the table : (a) Increases or decreases in the total number of families or cases aided from year to year are invariably uniform for all three charitable agencies. This indicates that the pressure of poverty impinges with rela- tively equal force upon the relief-giving agencies of Chicago. (b) The absolute number of cases where physical or mental dis- ability is a condition or cause of dependency rises or falls in most but not all instances with the increase or decrease in the total number of cases aided. This rise and fall is absolute and not proportionate to the changes in the entire group of dependents. 2(j2 (c) The percentage of problems or chief causes where physical or mental disability is a problem or chief cause is relatively uniform for the United Charities and for the Jewish Aid Society^ except for the year 1914-15. For the eight year period the proportion of problem where sickness was a condition ranged for the United Charities (excluding 1914-15) from 35.3 to 49.3 per cent; for the Jewish Aid Society (not excluding 1914-15) from 30.6 to 47.3 per cent; and for the Cook County Agent (excluding 1914-15) from 18.0 to 39.0 per cent. For the last three years (1915-18) the Chicago charities have reported sickness as a cause or problem of -poverty in from 30 to 50 per cent of the causes or problems assigned for dependency. (d) The unusually large degree of unemployment in the year 1914- 15 exhibits its effect in an unprecedented increase in dependency. With all three organizations the absolute nmnber of cases where sickness is a problem also rises but the proportion of cases where sickness is a problem or a cause declines sharply. This is the natural resultant of the con- junction of sickness as the most constant and unemployment as the most variable cause of dependency. (e) The great reduction in dependency from unemployment in the two charity years 1916-18 has been accompanied by an absolute decrease in the number and by an increase in the proportion of causes or problems ascribed to sickness. (f) In general the percentage of problems or causes of dependency where sickness is a cause or a problem varies inversely with the total number of causes or problems. It is perhaps fair also to state that, aside from years of unemployment, the proportion of all the causes or problems of dependency assigned to sickness by Chicago charitable agencies ranges from one-third to one-half of the total number of causes or problems of dependency. The high ratio of sickness as a cause or condition of poverty in the experience of Chicago^s charitable agencies requires further analysis. The studies of Warner, of D'evine, and of the Immigration Commission, as we have seen, correspond closely in designating sickness as the cause or a condition of dependency in one-fourth as compared with the reports and records of Chicago's charities which assign to sickness one-third to one-half of all the causes and conditions of dependency. The explan- ation is not difficult. Interest in the study of dependency is at its height when the problem of poverty is acute. Fluctuations of the poverty cycle naturally follow its most variant factor, im employment. With wide- spread unemployment, the circle of poverty rapidly expands, thousands of families are pushed below the level of bare subsistence, and dependency reaches its maximum. Warner, Devine, and the Immigration Com- mission all made their studies in periods of unemployment. The factor of unemployment is reported in 29.6 per cent of Warner's 7,225 cases ;^^ in 69.2 per cent of Devine's 5,000 families;^® in 76.4 per cent of Devine's 1,000 families,^^ and in 43.2 per cent of the 31,374 cases reported by the Immigration Commissi on.^^ Only in the year 1914-15, long-to-be-re- 35 Warner, op. cit. p. 55. 8«Op. cit. p. 204. »^ Op. cit. p. 228. »8 0p. cit. p. 120-1. 263 membered in Chicago for an unprecedented volume of unemployment, is the percentage of 43.2 per cent of the Immigration Commission sur- passed and then only by two of the three Chicago charitable agencies. The percentages of unemployment reported by Devine, 69.2 per cent and 76.4 per cent, are never attained. The nearest approach to his ratio is the 59.4 per cent of unemployment found in the 22,105 cases,^^ aided by the United Charities in 1914-15. Even the relatively moderate ratio of unemploment, 29.6 per cent, reported by Warner is exceeded outside of the unemployment years 1913-15 in only one year by one organization. The conclusion seems unescapable that the periods of the investi- gations by Warner, Devine, and the Immigration Commission are ab- normal for the study of poverty. The unusual volume of relief from charity due to the variable factor of unemployment occasioned a corres- ponding drop in the proportion of the more constant causes of de- pendency. We, therefore, conclude that the period of eight years covered by this study more accurately reflects normal and usual conditions, than the one-year and two-year periods selected by earlier investigators. There need, then, be no hesitation on grounds of divergencies from previous investigation in accepting the report of Chicago's charitable agencies, that outside of years of unemployment, sickness is assigned as a chief cause or a serious problem in one-third to one-half of all the apparent causes and problems of dependency. The records and reports of the United Charities and the Cook County Agent made it possible for the Commission to isolate and com- pare the relation to dependency of the three types of physical disability (excluding injury from accident) : namely, tuberculosis, chronic dis- eases other than tuberculosis, and acute illness. Apparently only the two following conclusions may be drawn from Table 27 which exhibits the number and proportion of these three groups of physical disabilities by charity years : (1) In reporting the distribution of physical disabilities other than those arising from accident as a serious problem, the United Charities assigned roughly, one-half to acute illnesses, one-fourth to tuberculosis and one-fourth to chronic diseases other than tuberculosis; and the Cook County Agent attributed about three-fifths to acute illnesses ; one-fifth to tuberculosis, and one-fifth to chronic diseases other than tuberculosis. (2) The absolute number of cases classified imder the three types of sickness rise with the increase in unemployment and fall with the re- turn to normal working conditions apparently with no consistent vari- ations between the different sickness groups. An illustration will sug- gest the way in which the alternation of opposite factors will have no effect upon the ratio of dependency attributed to the disease. In times of economic stress, such as unemployment, the proportion of dependency caused by tuberculosis tends to rise; when normal conditions of in- dustrial life are restored, the ratio of the tuberculous reported by chari- table agencies tends to be maintained or even increased because of the chronic nature of the ailment. " This percentage is obtained, as stated, on the basis of the number of cases aided, not of the total of "problems" assigned. Note difference from percentage of unemployment reported in Table 26. 264 TABLE 27 — NUMBER AND PROPORTION OP THE THREE TYPES OF PHYSI- CAL DISABILITY (EXCLUDING INJURY FROM ACCIDENTS) BY CHARITY YEARS AS REPORTED BY THE UNITED CHARITY AND COOK COUNTY AGENT, 1910-18. Charity year. Number of eases where physical disability (excluding accident) is assigned as problem or chief cause of dependency. Total number. Is •a-s o <^ Tubercu- losis. o •a-s o * o <* O Chronic diseases other than tuber- culosis. >> ^ *» M a . s o >. .i^ to a s? c 3 • S c . 4^ c3 ;3 3 CO 04 0} SS in f am. ndency. SS not a ndency. B ^ ^^ 3f« ^ >> S5S ^ OT s eo a G, * c3 C3 ta >. A 3 -d 0.5 -t.3 3 «i3 ^ Eh :z; ;^ H ^ ^ Ph e ;z; ^ ^ CQ m United States, white. . 89 6 22 6 16 22 6 16 3 7 6 1 13 5 11 United States, colored 19 13 49 '"2 7 6 7 13 1 3 5 5 4 8 5 3 19 '"6 5 3 13 7 1 Bohemian .... 1 4 1 1 German 3 1 1 3 Irish 37 66 38 8 107 17 60 2 2 3 1 8 1 1 6 14 5 1 3 3 5 11 2 13 20 21 2 30 3 22 2 5 5 2 11 1 2 11 15 16 4 1 2 5 7 1 2 14 4 4 2 2 '"2 7 2 1 3 1 2 2 3 15 3 1 7 1 9 1 2 1 4 2 3 Italian 5 Jewish 2 Lithuanian 2 Polish 36 6 14 11 2 1 25 4 13 19 2 20 4 ""3 4 ■"2 3 2 2 4 Scandinavian 2 Other 5 Total 503 33 129 36 93 160 40 120 18 49 23 15 11 60 16 38 270 that the findings of this study exaggerate both the actual and the nor- mal proportion of dependency due to chronic as compared with acute diseases. This overstatement of the role of chronic diseases was due to two of the conditions of the study., 1. The actual proportion of acute diseases is undoubtedly higher than indicated by the table. In the first place, the time of year, late spring and early summer, when the 628 families were assigned by the United Charities resulted in an apparent disproportion of chronic cases. As is well known, the major part of dependency from acute illness occurs in the winter months. In the second place, where both acute and chronic illnesses were present during the year, the cause of poverty was invariably assigned to the chronic disability. In the third place, illnesses of members of the family other than the breadwinner, while assigned as principal causes of poverty in only 16 families, were found in a majority of the other families and contributed to an accentu- ation of the lowered economic condition. In this connection it should also be mentioned that the larger proportion of children's diseases are acute rather than chronic. In the fourth place, acute illnesses, especi- ally those without adequate medical treatment, predispose the indi- vidual, through a lowered physiological resistance, to chronic diseases. The difficulty of ascertaining this indirect effect of acute sickness is readily understood. 2. The normal proportion of acute diseases as causes of poverty is unquestionably somewhat higher than for the year of the study.^* The unusual industrial situation of 1917-18 must be taken into con- sideration in the interpretation of the figures in the table. The regu- larity of work, at wages relatively high, even in comparison with the increased cost of living, for all able-bodied, and indeed semi-able-bodied men, women and older children, presents a condition unprecedented for Chicago. All the charitable agencies of the citv — the United Charities, the Jewish Aid Society, the Cook County Agent — report a decrease in the number of families applying for and receiving aid. How would this increased income affect the distribution between chronic and acute illness as a cause of poverty? The poverty caused by chronic sickness would be only slightly if at all reduced, because of the inability of the breadwinner to work at all for the many weeks of his disability. On the other hand the few weeks lost by the wage-earner out of work from acute illness could be borne in many more families in 1917-18 than in previous years without appeal to charitable assistance. In addition to these facts it must be noted that a considerable number of those in the groups from which these dependents came had health insurance. As a rule, the benefits paid under it are small sums per week and are usually limited to a fraction of the year, ^o doubt it made it possible for a larger number of those afflicted with acute temporary illness than of those with chronic disease to get on without appeal to charity. The way in which the economy of family life is actually affected by the different tvpes of physical and mental disability may best be shown by summaries of the histories of families representative of the 44 For example, see percentages in Table 27, page 264 of this report. 271 465 families where physical or mental disability was the predominating cause of dependency. The factor of insanity is not unlike that of death or that of deser- tion of husband according as the abnormal mental condition is perman- ent or temporary. In fact, in practically every case of the 33 families re- ceiving support from charity because of the insanity of the normal bread- winner, the husband and father was confined in a hospital for the insane. How insanity disintegrates family life and involves social loss need not be illustrated by concrete cases. In 129 or 27.7 per cent of the 465 families dependent because of sickness or accident, the normal breadwinner had been completely or partially unemployed with loss of wages or had suffered reduced economic efficiency and earning power because of tuberculosis. From the standpoint of economic degradation, the families where the main breadwinner was tuberculous fall into two groups : 36 families where he was unable to work at all during the year, and 93 families where he was able to work from one to fifty-two weeks in the year. The former group is wholly dependent upon charity except where the wife or the older child go to work or where there may be some small source of income. In general, the economic degradation has here reached a lower level than where the breadwinner is still able to continue work. Case 4. Normal breadwinner tuberculous, fifty-two weeks dis- abling sickness. — This Czech family of four consists of father, mother, a boy of nine years, and a girl of four years. The whole family is affected with tuberculosis, the father having been in- capacitated for three years. Before his sickness he was an assistant foreman, earning $20 a week. The prior economic standing of the family is indicated by the fact that the husband has $1,000 policy in Catholic Foresters; the wife, $600 in St. Cecilia. Their first application for charity was three years ago, when the father became unable to work. They have had no steady income since. The mother has worked "off and on" as a saleswoman, three days a week. She seems to be a good worker, and has no difficulty in finding work, when the care of the family allows her to be away from home. Last year she earned something over $200. The father is also insured in the Carpenters' and Wood-workers' Union. Case 5. Normal breadivinner tuberculous, less than fifty-two weeks disabling sickness. — Large German Polish family of ten mem- bers, father, mother, and eight children — all under ten years of age. Father is working, though in bad condition with tuberculosis. During the year he earned around $1,000. All of the children ex- cept the baby have tubercular glands. The family manages to get something to eat, but not the right kind of food, and look pasty and under-nourished. They have almost no clothing, one child having nothing to wear but a little suit of underclothes. All are bare-foot, including the mother, and all very dirty. The husband is insured for $500 in St. Francis' Society, the mother, in St. Mary's for the same amount. The parents have kept up industrial insurance for all the children. 272 This case shows not only that the tuberculous father is a menace to the health of the little children in the family, thus further aggravating the sickness problem of the home, but also that the economic condition of the family, already low, will be very likely soon be further depressed by the physical inability of the breadwinner to continue at work. Not unlike the difference between complete and partial disability from tuberculosis is the economic degradation caused by "other chronic diseases" where the loss of income because of unemployment from sick- ness is "fifty-two weeks," or "less than fifty-two weeks." The ailments included under "chronic diseases other than tuberculosis" are varied; heart trouble, rheumatism, cancer, syphilis, etc. The dependency of 160 or 34.4 per cent of the 465 families studied was ascribed to chronic dis- eases other than tuberculosis. Forty of the wage-earners so disabled were totally incapacitated for fifty-two weeks. Case 6. Normal breadwinner, other chronic disabling sickness of fifty-ttoo lueeks. — This Greek family has eight members : husband, wife and six children, the oldest a boy of 12 years, the youngest a baby of five months. The father has been unemployed all year. He has done light jobs or errands for the United Charities, and has earned a few cents or a little food. At thirty-six years of age he is thrown upon the industrial scrap pile. This man suffers from heart lesion and rheumatism. On account of his heart the physician states that he will never be able to work hard or steadily again. The mother is too delicate to work. She has to spend all her time caring for the children. It is probable that the family will be charges on the United Charities until the boys are old enough to work. It is a fine family. They have never taken out insurance, nor does the husband belong to any lodge or benefit society. One case may suffice to illustrate the group of families where chronic disease other than tuberculosis of the normal wage-earner is responsible for partial unemployment during the year. Case 7. Normal hreadivinner, other chronic disabling sickness less than fifty-two weeks. — The family is composed of mother who keeps house and daughter, Mary, who is over thirty years of age and is the breadwinner for the two. Mary was operated on for car- cinoma of uterus at the Cook County Hospital over a year ago. This operation has weakened her, and the doctor says she must be very careful — cannot do any kind of hard work. Mary cannot secure a better position because the physical examinations the vari- ous firms make every employee go through are too rigid. She fails every time to pass such examinations. Only in factories where physical examinations are not required does she secure work. Mary would like to secure some additional work to do at home in the evening, such as addressing envelopes. The effect of physical defects is not unlike that of chronic disease in the process of economic degradation. Included under this term are not only blindness, deaf mutism, crippled limbs, but also severe hernias. In 18 or 3.9 per cent of the 465 families the dependency of the family was ascribed to physical defect of the chief breadwinner. The following is a cause of partial unemployment in the year due to hernia. 273 Case 8. Normal breadwinner, physical defect. — This family of father, mother, and five children under 15 years of age, came to the attention of the charities in November, 1917, because of distress due to illness of breadwinner. Man was referred to a dispensary. The case was diagnosed as hernia. He was operated on in Feb- ruary, 1918. Since then he was unable to work as plasterer and was given several positions. He worked four weeks for the railroad com- pany and lost his job because of an industrial accident. He re- ceived $100, compensation. This money the family spent for furni- ture to replace what was taken away by the furniture store when they failed to meet their contract and pay the installments on it. - After the man recovered from his accident he was "placed" in a biscuit factory, but was obliged to leave at the end of two weeks as work was too hard ; he was later found a position in a downtown de- partment store, w^here he worked one week and was discharged he- cause of illness. The family has lived upon the partial support of the charities and the man^s occasional earnings which amount to little over $100 for the entire year. Accidents, non-industrial or industrial, sustained by the normal breadwinner were assigned as chief cause of dependency in 49 or 10.5 per cent of the 465 families. Twenty-three of these cases were designated as industrial accident, fifteen as non-industrial, and in eleven cases the information did not disclose the circumstances of injury from accident. Accidents, involving disability, lead either to an acute but tem- porary economic depression or to a long time economic degradation. The following illustration of non-industrial accident shows how dis- ability from injury constitutes a crisis which may temporarily or perm- anently lower the economic and social standing of the family. Case 9. Normal breadwinner. Disabling injury by non- industrial accident. — Mr. F. is a laborer in the steel mills earning $26.60 a week. He was able to meet the ordinary requirements of home economy for wife and three little children 6, 4, and 3 years old until he was taken to a hospital on account of injury. This occurred the night the youngest child was born. He was way-laid by two men and so injured that an operation was necessary. It was five months before he was able to resume his work. This accounts for the aid given by the Charity Association, and the company and the help otherwise given. Moreover, it accounts, for the borrowed money and the doctor^«^ bill of $125. Had there been adequate health or accident insurance there would not have been the need for charity nor for borrowing money ($75 to pay the hospital bill), nor the large doctor^s bill, $125 still due. All these things are a handicap to the family now. Fortunately the father has recently received an increase in wages which will probably make it possible for the family to regain its normal economic independ- ence. At the time of the visit of the investigator the front room had nice clean curtains at all the windows, and the rug and floor were quite clean. —18 H 1 274 Although Illinois has made provision for compensation for in- dustrial accident, the menace of economic loss is not wholly removed for while the law is compulsory in "extra hazardous employments/' it is elective in other employments and a considerable number of firms do not come under it. Moreover, there are occasional instances in which there are delays in making settlements under the law. Among the cases included in the investigation were 23 growing out of industrial accidents. Acute illness of chief wage-earner was assigned as the predomina- ting cause of dependency in 60 or 13.0 per cent of the 465 families. Acute illness differs from chronic sickness in that the economic losses, though often large, are temporary. A series of acute illnesses of mem- bers of the family may involve serious cost. "x\in't been a week there ain't been a sickness in this house," was the statement of an old colored woman. Where thousands of wage-earning families live on the seven- day budget allowed by the weekly pay envelope, disabling sickness of the normal breadwinner, if only for a week, certainly where it is for several weeks, brings pecuniary stress and strain which may result in economic depression into dependency. The following case is not un- typical of this sickness group. Case 10. Normal hreadivmner, acute illness. — Mr. B and Mrs. B. were born in Hungary. Of five children the oldest is twelve. The family lives in a frame cottage badly in need of repair. The home is poorly furnished, the floors are bare, the windows cur- tainless, but everything is clean. The children and their mother are well and neatly dressed. The father, a worker in the railroad car shops for over four years, earns from $25 to $30 a week, but much of the money went for coal last year, Mrs. B. says, and each week the grocery bill is high. In April Mr. B. caught a severe cold and was ill in bed for three weeks, during which time he received no salary, and, as they live up to every penny, the family had no money during his illness, so they appealed to the charities. During the man's illness the wife received credit at the grocery store, and since his return to work, she has paid off the grocery bill, and also the doctor's bill. In only 16 or 3.4 per cent of the 465 families was the illness of some member of the family rather than disabling sickness of the normal breadwinner the major cause of dependency. The small number of families in this group indicates that the loss of wages of the normal breadwinner is in general more important as a cause of dependency than disabilities of other members of the family, even where the expenditure for medical care runs high. Economic stress and strain, severe retrench- ment, lowered standards of living, are involved, but seldom, as in the following case, actual dependency. Case 11. Sickness of other memher of family. — Mr. and Mrs. M. each came to America alone about five years ago. They have but few relatives in Poland and only a cousin of Mrs. M.'s in Chicago. They got along very well after they were married, and lived in a nice flat until Mrs. M. became ill before her first con- finement last September. Mr. M. had to give up his work as 275 chauffeur and his wages of $20 a week to care for her. She later went to a private hospital where the expense was $4 per day. This took all of Mr. M.'s earnings and involved him in a debt of over $300. The baby was born at the hospital and was sick afterwards for a long time. Finally it was taken to the Cook County Hospital. The family did not ask aid of the United Charities or any one, but were heard of and helped. Mrs. M. had $500 when she married. Mr. and Mrs. M. bought a lot upon which they still owe $130. The. baby is well now. Mrs. M. does janitor work in return for rent. The actual family income for the 5^ear was $636 instead of $1,000 as would normally have been expected. Mr. M. is saving his salary to pay debts. They are very anxious to move • to a better flat. They belong to a Polish church on the west side of the city, but do not have clothing now to go anywhere. They are ambitious and hopeful. In summing up the role of disabling sickness by types of disability in the process of economic degradation the outstanding conclusions may be restated: (1) In disrupted families where the normal breadwinner is dead or has deserted, disabling illness ought not to be considered as a cause, but rather as a condition of dependency. Indeed, investigation indi- cates that in these families sickness was often a result of an already degraded economic condition. (2) In families not disrupted disabling illness (of whatever type) of the breadwinner is preponderantly the cause of dependency. In only 16 cases out of 465, or 3.4 per cent, was sickness of a member of the family other than the normal breadwinner found to be the predomi- nating cause of dependency. In a larger proportion of families, sick- ness of a member other than the normal breadwinner is, of course, a contributing cause, and in nearly all families a condition, if not a result, of dependency. (3) Chronic sickness, including tuberculosis of the normal bread- winner, is clearly the type of disability resulting in the most complete and permanent economic and social degradation not only because of the size of the group affected (40 to 50 per cent of all physical disability aside from accident) but also because of the long-time nature of the consequent economic incapacity. (4) The vicious circle of sickness and poverty is fully exemplified by the circular interaction of tuberculosis and economic degradation. Lowered economic status, with reduced standards of diet, predisposes to tuberculosis; tuberculosis of the chief wage-earner in turn involves diminished earning capacity and loss of time and wages. This degraded economic status makes impossible the standards of housing, clothing and food necessary for improvement and recovery of health. Although medical treatment is now free (at the Municipal Tuberculosis Sani- tarium), the infection of the wife and children ("all except the babV') requires the special tuberculosis diet which augments the rapidly grow- ing disparity between his earnings and the income required to provide for the health needs of the family group. 276 (b) Relation of Dependency Caused by Sickness to Normal Economic Condition of Family. The Commission was interested in discovering not only the types of disabilities making for destitution, but also more especially the nature of the economic changes resulting both from sickness as a whole and from the various forms of disabilities. The effect upon standards of family life from a chronic illness such as heart disease, will be, in general, quite different from that resulting from a temporary acute ill- ness such as bronchitis. At the same time, families of different economic levels will be variously affected by the same type of illness. A loss of a week^s work may be only a temporary inconvenience to one family, but a long time economic degradation to another. Normal economic status of the family was based upon the actual family income augmented by wages lost by the sickness of wage-earner during the year. It should be distinguished from actual economic status — which is determined by the actual family income diminished by direct outlays on account of sickness. For finding out the relation of economic condition to sickness, the normal in preference to the actual economic status was selected since it was the usual income level as related to family needs and habits of life before the incidence of sickness. In order to grade differences in the normal economic status of the family with rough precision, the families were grouped into the following four classes :*^ Class A. Families with "higher income" sufficient to provide for the necessities and certain of the decencies of life. Class B. Families with "meagre income" sufficient to provide at least for the bare necessities of life. Class C. Families with "low income" insufficient to provide for the bare necessities of life. • Class D. Families not assigned to the above classes because of in- complete reports of annual income. The normal economic status as determined in this way for the 628 charity families was as follows: Class A, 68; Class B, 139; Class C, 401; Class D, 20. That nearly two-thirds (63.9 per cent) of the fami- lies were in Class C is due to the fact that "normal" economic status refers only to the year under study. No adequate data were available for ascertaining earlier family income completely. In cases of the death of the wage-earner before the present year, or in cases of one or more years of partial or complete disability from tuberculosis, the use of the present year for deciding economic status is open to criticism. If the income history of the family for a period of the last five years had been accessible as the basis for determining the normal economic status, the number of families in Classes A and B would have been increased, and the number in Class C correspondingly diminished. In the absence of data for a period of years, it was necessary to use the only available basis, that of the year of the study. *^ See the Introduction of this report for a detailed explanation of the exact method of arriving at the dividing lines between these four classes by economic status, pp. 185-90. 277 The distribution into classes by economic status of 2,708 wage- earning families in the blocks studied makes possible the following com- parison with the economic status of the 628 charity families.' Normal economic status. Number of families in Block study. Charity study. Per cent families in Block study. Charity study. Class A with higher income Class B with meager income Class C with deficient income Class D with income not reported Total 1,687 631 280 110 68 139 401 20 2,708 628 62.3 23.3 10.3 4.1 100.0 10.8 22.1 63.9 3.2 100.0 A superficial examination of this table indicates for block and charity families almost an exact reversal of the proportions in groups A and C with practically no change in the percentage in group B. Taking the proportions at their face value it would appear that families in Class C (with deficient incomes) were 6.5 times as likely as families in Class B (with meager incomes) and 35.9 times as likely as families in Class A (with higher incomes) to be depressed through sickness into dependency. These figures, however, exaggerate the relative pressure of sickness upon the poor (Class C). Class C in the charity group (in contrast to the block group) contains a large but indeterminate pro- portion of families where chronic diseases and other long-time disabili- ties had reduced the family from its normal economic level before the year of the study. It is, therefore, manifestly beside the point to make a straight comparison between the normal economic status of Class C families in the block and in the charity studies. The figures of the tables may be taken only as confirming the common sense observation (which is so obvious, perhaps, as to need no statistical demonstration) that families in poverty, close to the margin of destitution, are more easily pushed into dependency by sickness or other misfortune. The following table is significant as indicating the normal economic status (for the year of the study) of the charity families classified by the kind of distress assigned as the cause of dependency: 278 Cause of distress. Num- ber of fam- ilies. Normal economic status. Cla;ss A (higher in- comes). Class B (meager in- comes). Class C (defi- cient in- comes). Class D (not reporting as to income). Families disrupted — ^ By death of adult male breadwinner (before year). . H By death of adult male breadwinner (during year). . By desertion Families not disrupted — Disabihty of normal breadwinner cause of dependency— By old age By insanity By tuberculosis (not working in year) By tuberculosis (working in year) By chronic other than tuberculosis (not working in year) By chronic other than tuberculosis (working in year) By physical defect , By injury through accident ^ , By acute illness Disabihty of normal breadwinner not cause of depend ency — Sickness in family the cause Sickness not the cp,use All families 55 2 10 43 25 4 3 13 37 2 34 8 1 1 6 33 1 6 25 36 1 32 93 9 24 58 40 1 5 31 120 21 34 65 18 1 2 14 49 8 23 17 60 10 17 30 16 38 4 5 5 7 7 26 628 ■ 68 139 401 5 1 1 3 2 1 1 3 20 Note-worthy differences by causes of distress appear upon a study of this table. 1. In cases of disability for a period exceeding twelve months (i. e. tuberculosis and other chronic diseases and physical defects) the normal economic status for the year of the study is predominantly in Class C ("A'' cases 3.2 per cent, "B'' cases 7.4 per cent, "C" cases 81.9 per cent, "D" cases 7.4 per cent). 2. In cases of disability for a period, presumably of less than twelve months (i. e. injury through accidents, acute illness) the pro- portion in Class C is less than half ("A^^ cases 16.5 per cent, "B" cases 36.7 per cent, "C" cases 43.1 per cent and "D" cases 3.7 per cent.) The only conclusion to be drawn from this comparison is that the normal economic status for the year of the study does not denote the original normal economic status of the chronic cases where the disability begins before the twelve months covered by the study and that the normal economic status of families with temporary disability more adequately represents the economic level of families in the charity study before the appearance of the disability responsible for the present distress. The assumption that at least half of the families were in Classes A and B, above the subsistence level and successfully meeting all risks of life except sickness, finds corroboration in certain other facts. De- spite the families forced to give up policies because of need, 70.7 per cent had one or more members with life insurance. Of the husbands of wage-earning families, 56.9 per cent had life insurance. The per cent (20.0) of the wage-earning husbands of charity families with dis- ability policies (or membership rights) indicates their attempt to pro- vide against sickness" hazards within the present organization of health insurance. Many wage-earners in charity families were, or prior to sickness, had been members of trade unions. On the whole, the group 279 of 628- wage-earning families before the occasion of disabling illness seems not to have differed from the independent families in the block study except in the undoubtedly smaller proportion in Classes A and B and the larger relative number in Class C. In order to prove or disprove this tentative conclusion, additional data in regard to the economic standing of the charity families before the year of the study were secured. The story of the family, as en- tered on the schedule used in the study and compiled from the charity records and from visits to the homes, provided evidence of the economic standing of 291 (out of G28) families before the time when the last (in many cases the first) appeal was made for relief. On the basis of this information families were divided into the following groups by economic standing prior to present dependency. (1) Families normally indevendent. — Families known not to have been in serious economic distress or to have been dependent before the present condition of distress were classified as "families normally in- dependent." (2) Dependent families. — Families known to have been dependent or in economic distress before the present occasion for appeal for relief were classified as "dependent families." These dependent families were further divided into (1) families previously dependent because of illness, (2) families previously dependent without illness, and (3) families previously dependent with no report in regard to illness. Of the 291 families where information on this point was available, 149 were assigned to the group of normally independent, and 142 were entered as dependent prior to the last occasion of distress. The reasons for the dependency of 28 of these 142 were not ascertained. Of the remaining 114, 40 had been dependent because of sickness, 74 for other reasons. It seemed desirable, therefore, to combine the families nor- mally independent with the families dependent previously because of sickness and to present the data by detailed causes of dependency as indicated in Table 29. The following conclusions may be drawn from an examination of this table: (a) Of 291 families reporting earlier economic standing, 189 or 64.9 per cent had been able to maintain against all the risks of life except sickness an independent economic existence prior to the present occasion of distress; 74 families, or 25.4 per cent, were previously de- pendent without disabling sickness; for 28 families, or' 9.6 per cent, the cause of previous dependency was not recorded. (b) Of 195 families where physical disability (excluding old age) was the occasion of present distress, 135, or 69.2 per cent, were assigned as previously aside from sickness economically independent; 42 families, or 21.5 per cent, were previously dependent without disabling sickness; for 18 families, or 9.2 per cent, the cause of earlier dependency was not reported. (c) Although the numbers are small, it is quite significant that the proportion of families with prior dependency without sickness is highest where the present occasion of distress is "desertion'^ or ''sick- ness not the cause." 280 The three chief points brought out in the analysis of the relation of dependency caused by sickness to the normal economic condition of the family are as follows: (1) The poverty group (Class C), as expected, contributed to the condition of dependency a much larger relative number of its fami- lies than did the groups above the subsistence level (Classes A and B). (2) Yet, as indicated by families dependent because of temporary sickness, the original normal economic status of one-half or more of dependent families was undoubtedly in Classes A^and B. (3) Furthermore, a special study of 291 of the 628 families showed that at least 189 (64.9 per cent) before the present appeal for relief had been (except for sickness) economically independent. (c) Large Size of Family as a Factor Interrelated With Sickness in Causing Dependency. Sickness, even where a major cause of dependency may of course be only one factor in a combination of factors. Some other factor, such as large size of family, often raises the inquiry, is not this condi- tion in itself, without the complication of disease sufficient to account for the status of dependency? Or the question may be raised, shall we be satisfied with the statement of disabling sickness as a factor? Should we not look into its causal antecedents, into malnutrition, into housing, into conditions of work and into climate as underlying and permanent causes? The Commission realized that it had neither the time, funds, money nor staff to undertake an exhaustive investigation into these and other conditions as causes of poverty. However, it is possible to present here data upon the size of the family as related to sickness and to dependency. Largeness of family as a cause of dependency has never been satis- factorily treated by the students of the problem of poverty. Warner*^ concludes that "large families are a relatively unim- portant cause of destitution.^^ This generalization is on the basis of a classification of more than four thousand charity cases in Boston and New York "52 per cent had one to three children and only 18 per cent had more than five children.^^ No statement is given of the relative number of families without children, nor the age of the children; all crucial points in determining the relation of the size of the family to poverty and dependency. The Immigration Commission does not list large families as an apparent reason why any of the 31,374 families studied appealed for relief, 19.9 per cent of these families are reported*^ as with "insuffi- cient earnings" which may have included "large size of family" as well as many other conditions. Devine in his studies in New York introduces as a definition of large size of family "families with more than three children under fourteen." He found that 18.9 per cent of one group of 5,000 depend- ent families*^ and that 16.9 of another group of 1,000 dependent families*^ had more than three children under fourteen. In appraising «Op. cit. p. 59. «Op. cit. p. 120-1. "Op. cit. p. 204. "Op. cit. p. 228. 281 TABLE 29- -PRIOR ECONOMIC STANDING OF 291 FAMILIES, CLASSIFIED BY CAUSE OF DISTRESS. Cause of distress. Families with report of prior economic standing. Families normally inde- pendent or dependent sickness. Families dependent without sickness. Families dependent no report as to sickness. Families disrupted — By death of adult male wage earner (80) By desertion (37) Families not disrupted — Disability of normal bread winner cause of depen- dency — By old age (8) By insanity (33) By tuberculosis (129) By chronic disease other than tuberculosis (160). By physical defect (18) By mjury from accident (49) By acute illness (60) Disability of normal bread winner not cause of dependency — Sickness in family cause (16) Sickness not the cause (38) All families (628) 33 13 1 15 60 79 7 37 22 11 23 291 27 5 1 9 38 59 4 21 13 4 8 189 5 9 12 2 12 7 3 14 74 3 1 1 3 8 1 4 2 4 1 28 282 this finding by Devine, it is necessary to give due weight to the fact of the unusually high rate of unemployment in the year covered in his investigation which consequently lowered the normal proportion of all the more constant causes of dependency. The charitable agencies of Chicago, while they may report separ- ately the size of the family, do not list it among causes of dependency. The large family as a cause of dependency may of course be included under the term "insufficient earnings.^^ The ambiguity of this omnibus well-meaning but unmeaning phrase should long ago have led to its disuse by relief agencies. It is undeniably desirable to know whether "insufficient earnings" denotes "insufficient earnings because the wage- rate of employer is below the normal industrial rate," or "insufficient earnings because of the reduced earning capacity of wage-earner from specified causes," or "insufficient earnings because the normal rate of wages is inadequate to meet the needs of subsistence of a family of large size." For these reasons we have determined upon a definition of large size of familv from the standpoint of the relation between income from wages and requirements of a standard of living providing at least for the bare necessities of life, and in addition, if possible, for its decencies, and, to a limited extent, for its comforts. A large family was, there- fore, defined as one with more than three children not over fourteen years of age and in which there was only one wage-earner. The prin- ciple underlying the selection, by all students of standards of living, of three children under fourteen as the basis of the determination of the adequacy of wages was accepted and applied here. The presence of only one actual or potential wage-earner in the family is, however, an added limitation. Children fifteen years of age or over, even if not actually earning wages during the year, were considered as additional wage-earners. The following table indicates quite clearly the correlation between the size of the family and the actual economic status in our block and charity studies: Actual economic status or condition of dependency. Number of wage earning families. Large families; four or more children not over 14 years and only one wage earner. Number. Per cent. Block families Class W with highest incomes. Class A with higher incomes . . Class B with meager incomes . Class C with deficient incomes Charity families 2,598 893 644 686 375 628 252 9 22 101 120 229 9.7 1.0 3.4 14.7 32.0 36.5 This table provides data for the conclusion that the economic status of the family varies inversely with its size. At the same time the slightly higher proportion of large families in the charity as compared with the poverty (Class C) group apparently indicates that largeness of family is seldom an immediate cause of dependency. The relatively high proportion of large families in the poverty and dependency groups 283 calls seriously into question Warner's statement that "large families are a relatively unimportant cause of destitution." Or can a percentage for large size of families twice as high as that found by Devine be explained sufficiently by differences between New York and Chicago and by the unusual unemployment of a decade ago ? Our study of 291 charity families who furnished data in regard to economic standing prior to the present occasion of distress made possible an indirect study of the relation of large families to chronic dependency. Of the 291 charity families, 99 or 34.0 per cent had four or more chil- dren not over fourteen years of age. Of the 189 families who were previously independent, or dependent only because of sickness, 55, or 29.1 per cent were of large size. Of the 102 families either dependent without sickness or not reporting as to sickness, 44 or 43.1 per cent were of large size. The fact that the proportion of families of large size was 48.1 per cent higher where families had been dependent with- out sickness, including those where status as related to sickness is not known, than where families had been previously independent or depend- ent with sickness indicates a fundamental if not a direct relation between size of family and dependency. In an attempt to exhibit a certain definite interrelation between size of family and cause of dependency by type of distress, the following table has been prepared : • All families studied. Large families i. e. with one wage earner but four or more children not over 14 years. Large families per cent of total families. Families disrupted— By death of adult male wage earner B V desertion of adult male wage earner 80 37 8 33 129 160 18 49 60 16 38 628 16 6 14 57 67 4 17 27 5 16 229 20.0 16.2 Famifies not disrupted — Disability of normal bread winner cause of dependency— B V old age 00.0 Bv insanity 42.4 Bv tuberculosis ... 44.2 Bv chronic disease other than tuberculosis .... 41.9 Bv physical defect 22.2 By miury from accident 34.7 By acute illness 45.0 Disability of normal bread winner not cause of depen- dency- Sickness in family the cause 31.2 Sickness not a cause 42.1 All families . . 36.5 Although the number of cases is small for certain types of distress, larger numbers would in all probability validate the following con- clusions : (a) The proportion of large families where the cause of distress is insanity, tuberculosis, other chronic disease, acute illness and where sickness is not a cause, it uniformly high — over 40 per cent. (b) In disrupted families and in cases of physical defect the per- centage of large families is relatively low, that is, under twenty-five per 284 cent. The small proportion of dependent disrupted families with more than three children is perhaps to be ascribed, in part, to the extent that widows and deserted wives with children are provided for by allow- ances under the Funds to Parents Law. The small proportion of large families where the breadwinner is disabled by physical defect is, in great measure, to be attributed to the large number of cases in which the early appearance of the defect delays marriage, or its late origin occurs after one or more children are past fifteen years of age. (c) The moderate percentage of large families where the cause of dependency is assigned to injury from accident provides a lead for de- termining the interrelation of disabling sickness and the large size of the family. The proportion of large families where the cause for de- pendency is assigned to injury from accident is 34.7 per cent; to chronic diseases including tuberculosis, 42.9 per cent; and to acute illness, 45.0 per cent. In injury from accident, as well as in disabling sickness^ a large family will predispose to an acceleration of the process of economic degradation ending in dependency; but it is difficult to understand how a large family would predispose to accident. The fact, then, that the proportion of large families is from one-fourth to one-third greater in dependent families where the cause of distress is attributed to acute and chronic illnesses than where it is assigned to injury by accident suggests that the large size of the family predisposes to disabling sickness, or at any rate is correlated with it. This association is, of course, not a direct one ; it is mediated by the consequences almost invariably bound up with large families — lowered standards of living, malijutrition, over-crowding, underheating and. so forth. The vicious circle in this situation may be analyzed in some detail. An increasing family, if earnings remain stationary, automatically tends to lower the standard of living. When once the family income is sufficient to meet a budget adequate to provide for the existence minimum, malnutrition, overcrowding^ underheating, and deficient clothing, severally, or in combination, are inevitable. This lowered level of living depletes the physical vitality and diminishes the physiological resistance to disease. Consequent disabling sickness of the wage-earner, more often than not accompanied by illnesses of members of the family, entails loss of wages, and the costs of medical treatment. The desperate situation of the wage-earning family now dependent as a result of this process of economic degradation, is graphically described in the following instances. Case 12. Normal hreadwinner^ other chronic disablmg sicTcness of fifty-two weeks. — Mr. and Mrs. N. have seven children, all girls. The oldest is only twelve years old, the youngest nine months. Mr. N". has been working for a car shop during a period of five years. He had been doing heavy work, and soon developed heart trouble. Later his physican forbade him to work, but having a wife and children to support he kept his position until he was obliged to leave and apply for admission to the Cook County Hospital. He is not able to work, and is at present at home hoping for a time when he will be able to work again. His wife is not able to work- since the youngest of the children is only nine months old. The 285 County Agent provides the family with groceries and other necessi- ties, while the United Charities is paying their rent and also eight dollars a week for living expenses. The man and woman are, how- ever, in very low spirits seeing no way out of the situation. To get well the man would need to spend several months at least on some farm having plenty of fresh air and good meals. Both the father and mother say that they keep on struggling only for the sake of the children. The next case shows the difficulty of even an industrious and home- caring man to provide for a wife and eight children. ' Case 13. Normal hreadivinner, acute illness. — There are eight children in this Polish family, ranging in age from boy of ten to a nine-months baby. The father is thirty-seven and the mother thirty-one. He earns $15 a week as foundryman, but lost three weeks wages because of stomach trouble. Last year the total family income was only $745 which is only fifty-four per cent of the con- servative amount fixed by our conservative charity budget as neces- sary to provide for the necessaries of existence. The children have been in bad need of clothing as wife is unable to manage on the husband's wages. He is a sober man and always turns his pay en- velope unopened over to his wife. However, the family is Just kept from starvation. Only the children are insured for five cents each a week. (5) Sickness as a Cause of Poverty. A Study in Economic Strain and Lowered Standards of Living of 2,108 Wage^earning Families. The investigations of Warner, Devine and the Immigration Com- mission are studies of dependency, not of poverty. The analysis of the reports of Illinois charity organization societies, of three Chicago Char- ties, and of the 628 charity families in the Family Study were con- cerned with dependents rather than with the broader group of the poor. While it is not to be gainsaid that the facts of dependency throw light on the conditions and causes of poverty, it is not sufficient merely to apply without modification to the group of the poor the findings of the study of the dependent. The distinction between dependency and poverty has already been made.^*^ The dependent are those supported temporarily or perman- ently by State or private charity. The poor are those who live below a minimum standard of physical existence. Charitable aid as the cri- terion of dependency is easily applied. Existence below a physiological minimum as the criterion of poverty is not only more difficult to de- termine, but is less objective, and, in consequence, less readily- agreed upon by students of the problem. In fixing upon an income necessary for the bare necessaries of life, but relative to the composition of the family by number, sex, age, and employment, it was decided to employ a conservative budget already in use by Chicago's charitable agencies. As explained in detail i^ the introduction^^ to the Family Study, the sum below which an income would be regarded as deficient for a family ^ See p. 184. "See p. 185-88. 286 of father, mother and three children, not over fourteen years of age was fixed at $850. From the standpoint of this study "the poor" in our 2,708 wage-earning families living in the blocks surveyed in the Family Study are those whose actual economic status for the year 1917-18 was determined as Class C. The assignment of families to Class C as "the poor" is from the standpoint of their income only, not from that of actual living conditions. The point may be made as a concrete fact of social life that poverty is not to be determined in the arbitrary w^ay just described, that poverty is relative, and is more naturally represented by the acute distress caused by dow^nward revision in a customary standard of living. It is recog- nized that poverty may be regarded from both viewpoints, either of an income inadequate to provide for the bare necessities of life or as an abrupt reduction in income requiring radical changes in habits of ex- penditure. For this reason the analysis of the relation of sickness to poverty is taken up under two heads : (a) Sickness as a cause of lowered standards of living. (b) Sickness as a cause of poverty defined as income below stand- ards of a subsistence budget. (a) Sickness as a Cause of Lowered Standards of Living. A sudden shift such as that caused by sickness, unemployment or other misfortune, from an accustomed to a lower economic level, always constitutes a crisis, requiring adjustments in mental attitudes and habits of life. Deprivation, if not distress, is inevitably involved. The extent and the nature of the changes caused by disabling sickness are clearly seen in the relation of illness to change in economic status, to the high costs of sickness, and to family deficits. In 313, or 13.2 per cent, of the 2,598 wage-earning families, costs of sickness in lost wages and in direct outlays caused a shift to a lower economic status during the year. This change was measured by de- termining for the year of the study both the normal economic status (actual income increased by lost wages) and the actual economic status (actual income decreased by direct outlays for sickness). Of the 1,022 families in Class W, 129 or 12.6 per cent experienced a descent in eco- nomic-level, 112 making one shift to Class A, 15 two shifts to Class B, and 2 three shifts to Class C. Of the 665 families in Class A, 133 or 20.0 per cent were shifted downward by sickness, 121 making one change to Class B, and 12 two changes to Class C. Of the 631 families in Class B, 81 or 12.8 per cent descended one level to Class C. In any use of these shifts in economic status it must be understood^- that although the line of division between Classes "C" and "B" was determined by the income necessary to provide for a charity or subsist- ence budget, the dividing lines between Classes B and A and between A and W are arbitrary. Accordingly in many cases large sickness costs may occasion no change in economic status (taking place within the limits of an economic class), while a relatively small sickness cost in a family just above the dividing line between two economic classes will be ^"^ See Introduction, pp. 185-90 for a detailed explanation of method of arriving at the different groups by economic status. 387 sufficient to depress it into the lower status. Yet, on the whole, sick- ness costs occasioning shifts in status were of considerable size. In relatively few cases was the downward shift the result of com- paratively small sickness costs. Only 40 of these families or 11.7 per cent had sickness costs of less than $50 (averaging $26.38) ; 55 families or 16.0 per cent had sickness costs of $50 but less than $100 (averaging $76.36) ; 63 families or 18.4 per cent had sickness costs of $100 but less than $150 (averaging $122.46) ; 36 families or 10.5 per cent had sick- ness costs of $150 but less than $200 (averaging $179.67) ; 48 families . or 14.0 per cent had sickness costs of $200 but less than $300 (averaging $242.58) ; 35 families or 10.2 per cent had sickness costs of $300 but less than $400 (averaging $343.71) ; 23 families, or 6.7 per cent had sickness costs of $400 but less than $500 (averaging $438) ; 43 families or 12.5 per cent had sickness costs of $500 or over, averaging $681.91. The following table gives the grouping of wage-earning families excluding Class D by both '^normal" and "actual economic status." Normal economic status (income augmented by wages lost in 1917-18). Actual economic status (actual income less costs of medical treatment). Number. Per cent. Number. Per cent. Total wage-earning families 2,598 100.0 2,598 100.0 Reporting completely — Class W families with liberal income 1,022 665 631 280 39.3 25.6 24.3 10.8 893 644 686 375 34.4 Class A families with moderate income 24.8 Class B families with meager income Class C families with deficient income 26.4 14.4 As the outcome of the 343 shifts, we find that the difference be- tween normal and actual economic status is inconsiderable in Classes A and B, but considerable in Classes W and C. Other facts concerning the relation of disabling sickness to change of economic status are desirable. Data are available upon two points: (a) first, sickness losses causing change in economic status classified by the member of the family whose sickness was largely responsible, and (b) secondly, the types of illness chiefly responsible for shift to a lower economic level. The following table was prepared to show the change in economic status occasioned by the disabling illness of particular members of the family. In every case the illness of the assigned person entered definitely into the loss that occasioned the shift in economic level. In cases where disabling illness of more than one person is re- ported the disabling sicknesses of two or more members of the family were held jointly responsible. 288 Particular member or members of family whose disabling illness was the cause of shift to lower economic class. Number of shifts in economic status attributed to particular member or members of family. Normal bread winner (father) only Mother only '. Wage-earning child or children Unemployed child or children Dependent relative Normal bread winner (father) and mother Normal bread winner (father) and a wage-earning child or children Normal bread winner (father) and unemployed child or children Normal bread winner (father), mother, and unemployed child or children Normal bread winner (father), mother, and wage-earning child Mother and wage-earning child or children Mother and unemployed child or children Total 165 74 22 21 3 24 11 2 5 1 2 13 343 This table shows that the illness of the father as the normal bread- winner was assigned as full cause of the shift to a lower group in 165 out of 343 cases, and entered in 43 other cases in conjunction with ill- ness of other members of the family. A comparison similar to the last was prepared to indicate the rela- tive weight to be given to different types of sickness in the 343 cases of change to a lower economic class. Since in certain cases of shift the sickness of two or more members of the family was held responsible, it was necessary to apportion responsibility in certain cases among two or more disabling illnesses, considering each case as a unit. Type of disabiling illness causing shift to lower economic class. Type of disability held respon- sible for shift to lower economic status. Number of unit cases. Per cent. 11.0 3.2 138.0 40.2 111.0 ■ 32.4 31.0 9.0 30. .5 8.9 6.5 1:9 2.0 .6 1.0 .3 3.5 1.0 8.5 2.5 Tuberculosis Chronic diseases other than tuberculosis . . . Acute illnesses Confinement Accidents Physical defect Insanity Old age No disabling sickness, but cost of medicine Nature of illness, not reported Total 343. 100.0 The low proportion of cases of tuberculosis, strikingly smaller than the percentage reported by the United Charities and Cook County Agent as problems or causes of dependency, is, in part, to be explained by the assumption that families, in many cases, did not report the ail- ment as tuberculosis. The larger proportion of chronic as compared with acute illnesses is due to the disproportion of chronic acute ail- ments in the cases where sickness of mothers was held responsible for 289 the shift to a lower economic class. In only 3 out of the 343 cases did the disability^ held responsible for the shift continue fifty-two weeks. While acute and chronic diseases are considered responsible for nearly three-fourths of the shifts, attention should be given to the proportion of weight assigned to confinement as leading to lowered economic status. In 26 cases the entire and in 11 additional cases the partial reason for the shift was found in the expenses connected with maternity. A less artificial and arbitrary criterion of lowered standards of living than change in economic status is afforded by a study of sickness losses and of family deficits resulting from illness. The average cost of sickness of wage-earning families reporting was $97.98. A loss of approximately $100 per family is large enough to place a severe strain upon the great majority of wage-earning families. From the stand- point of lowered standards of living, deviations from the average^ and not the average sickness cost, are significant. Important also is capacity to bear sickness losses as indicated in our study by the grouping of families according to economic status. The following table indicates the distribution of sickness costs above the average among the wage- earning families in the blocks grouped by economic status : Sickness costs in excess of- Percentage of families reporting sickness costs in excess of SIOO. All. Class A. Class B. Class C. $100 $200 $300 $400 $500 30.4 31.3 26.6 21.1 16.6 12.3 9.2 11.2 7.0 5.4 8.0 4.1 3.4 3.6 2.7 34.1 17.9 8.4 5.0 3.4 Interpreting this table in the light of facts presented earlier in this report, we find: (1) although the proportion of sickness is higher with the poor than with those above the subsistence level (percentage of families with disabling illness, 76.0, 73.0 and 63.4 for Classes C, B, and /^53 respectively), the burden of sickness losses, as already determined, is much greater in the case of poor families than of those in meager and "better off'' circumstances (sickness cost relative to total family income 15.6 per cent for "C," 8.4 per cent for "B,'' and 7.5 per cent for "A'' families) ; (2) that as shown by this table the proportion of families in poverty with sickness costs in excess of $100 (greater than the aver- age for all families reporting, or $97.98) is somewhat greater than the per cent of families with higher incomes, and considerably above that of families with meager incomes (34.1 per cent, 31.3 per cent, and 26.6 per cent for families in Classes C, A, and B, respectively.) The fact that 3 out of every 10 families reporting state sickness losses in excess of $100 for the year suggests the degree of economic pressure placed upon a large proportion of wage-earning families. =3 See p. 203. —19 H I 290 Smaller sickness costs may perhaps often be met with little or no per- ceptible lowering of the standard of living. Large illness losses fre- quently compel wage-earning families, whether with or without the small protection of existing health insurance, to close the year with a deficit. A deficit at the end of the year even better than sickness costs is indicative of economic stress and strain. Important facts in regard to deficits — the - number and proportion of families failing to make ends meet, and the percentage of deficits of income are shown here b}^ economic status for the block, nursing service and oharity families 54 Economic status. Number Number of Number Per cent reporting Amount Amoimt families with with amount of of with deficit. deficit. of mcome. deficit. sickTiess. mcome. Per cent deficit of income. Block study Class A Class B Class C Nursing service study Class A Class B Class C Charity study 1,744 290 16.6 247 251,591 38,213 1,070 461 213 102 96 92 9.5 20.8 43.2 90 84 73 122,543 83,800 45,248 14,304 8,733 15,176 265 110 41.5 97 120,604 12,564 127 90 48 42 35 33 33.1 38.9 68.8 38 32 27 59,801 36,828 23,975 5,959 3,448 3,155 554 502 90.6 409 228,362 100,063 15.2 11.6 10.4 33.5 10.4 10.0 9.4 13.2 43.8 This table shows, first of all, the relatively large number of families with deficits in the charity and nursing service groups. This is, how^ever, only to be expected for they are selected groups. A sig- nificant fact is that while only 1 in 11 (9.5 per cent) of the Class A and only 1 in 5 (20.8 per cent) of the Class B families in the block study had deficits, the corresponding figure for Class C families was more than 2 in 5 (43.2 per cent). Another significant fact is that the deficits for C families were relatively much larger than the deficits of families in Classes A and B. The deficits of those in the first (Class C) group were 33.5 per cent of their incomes; of those in Class A, 11.6 per cent; of those in Class B, 10.4 per cent. These same variations, although to a smaller extent, are shown by the percentages presented for the nursing service families. That two-fifths of the wage-earning families in poverty had last year, in connection with sickness, deficits averaging one-third of their income suggests the pressure of sickness in pushing the poor into dependency. Naturally the question arises as to how far sickness was the cause of the deficits shown. A partial answer is given in the data collected. One fact shown is that the average sickness costs of families with deficits was much larger than the average for the entire group studied. Thus, the average of sickness costs for the block wage-earning families with deficits was $183.09 as against an average of $97.98 for the 1,667 reporting completely the data desired; that of the nursing service families with deficits, $214.79, as against $136.72 for the larger num- ber; that o f the charity families with deficits for the year (including ^ See also Table 30, p. 294. 291 nearly all of course), $274.63 as against $235.33 for the entire number. But after all what is most desired is a direct comparison of the amount of deficit and the sickness costs in lost wages and direct outlays in each case investigated. Making such a comparison for 83 A families in the block studies with sickness and deficits and for whom all data required could be obtained, 56 had sickness costs exceeding their deficits, 26 had deficits exceeding their sickness costs, while in one case the deficit and sickness costs were reported as the same. Taking 73 B families in the same study, 41 had sickness costs in excess of tlieir deficits, while 32 had deficits in. excess of their sickness costs. Taking 66 C families, in 34 cases the sickness costs were in excess of the deficits while in 32 cases the contrary was true. Comparing averages where sickness costs ex- ceeded deficits, the former were $345.41, the latter $104.23 for A families, $195.29 and $67.02 for B families, and $220.59 and $84.26 for C families. Comparing averages where deficits exceeded sickness costs, we have $303.69 as against $110.15, $165.88 as against $44.81, and $255.88 as against $46.06 — the averages of deficits and sickness costs for A, B and C families respectively. These data merely put into statistical form what every one knows, viz., that sickness is a very important but not the only cause of family deficits. That 1 in 6 of all the wage-earning families with sickness in the blocks studied had last year lost wages and direct outlays caused by illness avel-aging $183.09 does not tell the whole story. The data thus far presented must be supplemented by other information, for sickness costs are more or less frequently accompanied by exhaustion of savings, by retrenchment and deprivation, by incurring of debt, by gainful em- ployment of wife or older children, by charity and dependency. In practically every case of illness the cost of medical treatment had not been foreseen or calculated upon as part of the family . expenditure. All of the 1,744 families, approximately two-thirds of the entire gi-oup of 2,598 families who reported disabling sickness, apprehended if they did not actually experience the menace of an imperiled standard of living. The exhaustion of savings to meet the losses of sickness would not, from a purely economic standpoint, be considered a change in ihe standard of living. From the point of view of family security and social attitudes, however, it generally involves a descent in the scale of social life. In a considerable number of our charity families use of savings preceded appeal for aid. In the families in the blocks thirty- seven report drawing upon savings to meet costs of illness. Retrenchment and deprivation almost invariably accompany and follow sickness. Illness in most cases means unforseen and increased expenditure often concurrent with a reduction in income through loss of wages. The emergency in the family economy must be met. Among all independent wage-earning families the most common method is retrenchment and deprivation. Not infrequently the retrenchment is in medical service requisite for the treatment of the disease. Case 14. Retrenchment and deprivation. — A young* Polish- American couple with a child three years of age, live in a rear 292 apartment of three rooms renting for $6 a month. Last winter when the father was home ill with rheumatism the mother was employed two weeks at piece work, earning about $6 a week. This was the only time she had worked since her marriage. They wanted to have a doctor for him, but "it cost too much'' and "he got well without it." Several striking illustrations of deprivation of medical service might be presented. There is the woman, a Jewish immigrant from Eussia, who because of retrenchment due to illness of husband, was compelled to give birth to her child at home instead of at the hospital as had been arranged. In a German Polish family, because of the disabling sickness of the father, there was so little money that the mother had neither physician nor midwife at the time of childbirth. Most often retrenchment takes the form of deprivation in needed food, clothing and heat. More than one family reported to our investi- gators that as a result of sickness of wage-earner "they lived on black coffee and bread'' and in one instance our visitor found that in a family where the breadwinner had been disabled for twenty-five weeks the noon-day meal for father, mother and three children, seven, five and three years old, consisted of bread and beer. A special form of retrenchment is the change in standard of living involved in moving to cheaper quarters. Retrenchment in food and warmth, even in -clothes, does not carry with it the sense of Social defeat implied in the act of moving to a poorer dwelling. An agent of the Commission in her report on a certain block commented on the disgrace experienced in this descent in social status. "An interesting situation was revealed in the case of the few Americans in the block. They live in the poorest and cheapest dwellings on the street, and have come there apparently to hide from their friends until their circumstances are bettered. In two cases, prolonged sickness was the drawback. As a rule, the Americans, considering themselves superior, do not mix with their neighbors." How sickness costs may compel moving to a cheaper location and the possible social consequences upon childhood is well indicated in the following case: Case 15. Retrenchment and deprivation. Moving to cheaper quarters. — This is an American family of the standard budget type, father, mother and three children. This mother is decidedly an exceptional woman. She told the visitor that three years ago the family lived in a $20 flat in one of Chicago's suburbs; they had plenty of space and there was fresh air for the children. However, the children became sick; they had measles together, then they caught scarlet fever, and no sooner were thev better than the baby got infantile paralysis. For the whole year, practicallv, the chil- dren were ill, and the doctor bills and other debts increased con- tmually. The father worked steadily, but by the time the children were entirely recovered, the family was badly in debt. The first thing the mother did was to move to this $11 flat, and she has scraped and economized every possible way during the last two years 293 to get out of debt. She says it is only the last two months that they have paid up every penny owed. Not infrequently moving to cheaper quarters denotes moving to houses in bad condition. AY here the combination, as in the next case, of sickness, loss of economic productivity and of bad housing occurs, the family has reached the depths of destitution and degradation. Case 16. Retrenchment and deprivation. Moving to bad hous- ing conditions. — This family of father, mother and five children under fourteen years of age, is in very bad circumstances. Mr. B. has been tuberculous for several years, and within the last year has been forced to go to the Municipal Tuberculosis Sanitarium for treatment, thus being unable to contribute to the support of the family. Mrs. B. is his second wife, and the step-mother of the three oldest children. For some time she was not allowed to work, owing to the fact that her children needed her at home. However, she managed to work about two days a week, for about half of the year, earning under $100, when she was able to leave the children (those not going to school) with a friendly neighbor. The home to which the family w^as forced to move by the father's sickness, is a sorry sight, situated in the rear of another house. It is a wooden structure, and could easily be mistaken for a common woodshed. Directly in the rear of this house is a railroad track upon which . the oldest son goes to pick up stray pieces of coal. With retrenchment and deprivation, sometimes without it, comes debt. The resistance of wage-earning families against going into debt is strong. Agents for the Commission quote families as having a "horror of debt,"^^ or willing "to go without food rather than go into debt.^'^^ Yet many families were forced to leave bills unpaid, or to seek loans be- cause of sickness. Table 30 presents an analysis of deficits of the wage- earning families with sickness in the block, nursing service and charity groups. Of the 1,744 block families with sickness in Classes A, B and C 290, or 16.6 per cent, had deficits at the end of the year as against 40, or 4.7 per cent, of 854 families^'' without sickness who failed to make ends meet. Of the 290 families with deficits, 104 left bills unpaid, and 64 made loans, and the remainder drew upon savings, used principal of insurance received, etc. Case 17. Going into debt. — ^The mother and sister of the wife live with this young colored couple, who have no children. When the husband lost ten weeks by sickness, the wife went to work. Out of her earnings she was able to pay only for food, oil, light and three months rent. The back rent was gradually paid up out of the earnings of the husband when he returned to work. They are now square with the world. As long as the credit of the family is good and the grocer, landlord and physician do not press for payment, as often, especially where there is sickness in the family, they are willing to do, the family is able to maintain its self-respect and confidence. Occasionally, however, the chattel mortgage and the "loan shark'' obtain a hold upon the family. 'K'U. S. I. 23. "G. 12. " See also Summary Table, p. 199. 294 00 iMoox eo icosoi CD I CO a>r-ici ^ Ttiioc > t^ OS (Nxoo c^ t^co^ a> 1 • •junouiy ■^"^ • O • O o g O "* O— 1 o • o • ?- ■-I Tf> t>. IC • lO T}< •:)anouiv IM" rt" oT 03 «» «9 !** ui 3 en 1 -<»< (N-<1<00 ^1 • r~i • rH l-H ■J9qLUUM i-H C^ 1-1 O -^ (M '^ -^ -^ •>* O C<1 'A lo r-r-o o cooi^ lo -4-d "2 n c^cc ^ oo- ^ X en 1 •ijunomv oc~ c-Tc^'cc" ic" (m'-^".- 0) «« 4« «« rr* J4 b£ g-" 1 s l» Of^CS -"f OiOO o 1 c '■♦J •J9qran2>i 5 '*'■*e>^ o cocN rH ir > OCO (>« tf 5 0>C O rt< 't-^ c 5 (N —t^ C 3 iC t^ 00 -"l* • ^H a CO • c 5 COt^ "H •»4 a o3 PL, M t> ^ TfcM If 5 C*l i-i Ci c 5 0» rH r-^ a ; 00 lij lo u- > lO X (M -^ :• 05 o 00 c: 5 O O lO rH O 05 S < CO O lO CJ 5 CO t^ lo ei '3 CQ •^unomy r gfe^TiM" c< =" s to t3 h3 ^ 1 O 05 OS C i (N .-1 .H ev 5 ,-H ic t^ •»»» 1 ««-4 o •jaqran^i «: J rH eo T) < »0 05 O tf 5 • . Ifl Tt< 1 CO O D — < cc cc c 5 •CO M 1 >> • u; 5 Tjt o o CO "3 08 Si a •junouiv S ir > iC t^C9 t- H ■ -< »o •jaqiuti^ c > c^ 1 S c< J -^ CO o e^ 1 OlQCiO CO < OMt^ C£ J iC -f »o O 5 O ■»*< rH O ^ 1 rc t^ .H ir - •jiogap JO }unorav 2 ; — 1 rH t- r lo'co'^co'^ o «<; > «» M r < re o oc -j • i-H OC' i-O (N a 5 OCSIt^ O ir ! iC 00 (N C£ > OC X 0> CO ainoouT JO :junonrv r— r (NTfo^'-rr c r c^to:' r otT ir ) (M 00-* O 1 UOCOS^ (N 1 C^ i CM X 1 •>* 030Ct>. c s coco CS o •;£taj9ldTnoo c\ 1 >* 3uT}jod9J jaquiTiM ) c^ o c^ c s C * Oi .- 1— t t— > C^i-OC^ {SJ < ■* CO oc 4 s IT ogap qiiAv jaquin^ •^ 00 »0 -H ir. ) lo ic ir: e CSl CJ Tt •ssaini OTS qjTAv saniniBj t^ O -^Cl CS rH U5 s unuB a-a2BA\ JO J9quin»sj r-( oc t^r-<0 >- OlrHX O a- oc CC 00 t^ CO o>-* r?S •sanini^J IT. O O IM CN .-H jS 3UTU iBa-93i JAijo j9qinriuiBjox (N 1-H ■4-> V4 O > CO 3 . c^ • a >» a > ' 3 CO o o •fJ CO CO a bi 5 CO CO o: >» CO CA & ^ 03 cS cC 9—t ^H 1-^ *J W ooo C^C^O cS Xi 1 « ;z; O 1' 295 Case 18. Mortgage on furniture.^ — This is a Jewish family of six members: father, mother, a daughter of 17, a son of 16, and two girls of 13 and 11. When the husband was ill, the wife was forced to mortgage the furniture, including the piano. This debt of $200 worries the mother and she intends to get some sort of light work in order to help pay it off. The two older children both have appendicitis and the doctor has urged an operation, but the children are afraid and the parents cannot afford to pay for opera- tions. The mother would not allow them to go to a dispensary. The mother has had several operations within the last three years, but all without cost. She is not able to do much work. The two older children Avorked for a time in the summer, but will return to high school in the fall. When the wife or children under 16, or older children, go to work because of illness in the family, the standard of living is lowered at still another point. The imminence, if not the actual pressure of desti- tution, because of the disabling sickness of her husband, drives the wife to work to prevent or lessen deprivation. Her enforced absence from the home may lead to loss to the family and to the community. In 74 families or 4.2 per cent of 1,744 wage-earning families in the block study where sickness was recorded, the wife (39 cases), or children under 16 (19 cases), or older children (16 cases), went to work io ^ supplement the family income, reduced by loss of wages and depleted by sickness expenditures. The following case indicates the drain upon the physical strength of the wife and mother by reason of the double function of housewife and breadwinner : Case 19. Substitution of wife for disabled husband as bread- u^nner. — -This Polish family consists of four members, father, mother and two children, 12 and 8 years old. The father is a cement worker by trade. The first fifteen weeks of the year he earned 30 cents an hour or $14.40 a week. Then early in November he caught a severe cold from which pneumonia developed. This laid him up until the first of March. Just as he was starting to work again, he feH and dislocated his shoulder, which kept him at home another month. After his fall, the mother took a "job^^ as dishwasher in a restaurant at $8 a week. She is not very strong and the work was too hard for her. In April and in May she was at home two weeks at a time with colds. The last of March the father, whose shoulder had still not entirely recovered, started to w^ork as flagman on the tracks at $15 a week. He is far from well and has had to stay at home twice this summer for about eight days at a time. He never remains away from work long enough to receive any sickness benefit. The first of July the mother gave up her work at the restaurant and is staying at home now. She has decided there is no use in her. trying to work any longer, as it is altogether too hard for her. About four months ago, the family took a lodger, who pays them $3 a month. As indicated in the last family history, the taking in of a lodger is one method by which the wife increases the family income and re- 296 mains at home. Several of our reports refer to the real lowering of standards in wage-earning families consequent upon the presence of a roomer. Overcrowding, the disturbance of the privacy of the home, and even the disintegration of the family are mentioned as results of letting a room to a lodger as a method of meeting the costs of sickness. After exhaustion of surplus, where one exists, after retrenchment and deprivation, after all means of self-help, such as the going to work of wife or older child, are inadequate, the family as a last resort appeals to charity. Fifty of the 2,708 wage-earning families, in the blocks re- ceived relief from Chicago charities last year, 44 of them in connection with sickness. Elsewhere^^ in this report the social degradation involved in dependency has been described. Wliile individual and racial atti- tudes in regard to help from charity differ, the average Chicago wage- earning family seems to prize its independence. As a sturdy Slovak woman said, "I would rather work hard for my own money than have to beg it from the city." The following case, while perhaps not typical, is certainly not exceptional in its indication of the attitude of families toward seeking and receiving aid from charities. Case 20. Appeal to charity. — Mr. D. has been tuberculous for more than a year. He seemed quite reluctant to admit that he had had to apply for aid. When he was out, his wife told me that she had applied to the charities to help her in caring for Louise, her daughter. Louise was to be brought home from the Municipal Tuberculosis Sanitarium but the visiting nurse would come daily to dress her side. Mrs. D. seemed grateful for help, and said that she could not manage without help. The Municipal Tuberculosis Sanitarium had screened their porch and equipped it with beds. Their home was in good order and well finished. Not infrequently families are found where sickness had ultimately resulted in personal, economic and social degradation. Its forms are various : permanently lowered physical efficiency of the person ; reduced economic capacity of the wage-earner; pauperization; family disinte- gration. From the analysis of shifts in economic status, of sickness costs, of deficits and from the description of concrete changes in the economy of family life the conclusion seems unescapable that disabling sickness yearly causes sharp economic distress and depressed standards of living in a relatively large number of wage-earning families in Chicago. How large this proportion is may be gauged in some degree by bringing to- gether the different figures already presented. (1) Of the 2,598 wage-earning families 343 or 1 in 8 (13.2 per cent) or approximately 1 in 5 (19.7 per cent) of those with illness during the year experienced a shift to a lower economic level because of sickness. In the great majority of cases this resulted from substantial losses. (2) Family sickness costs in excess of one hundred dollars were borne by 3 out of 10 families reporting completely. (3) Approximately 1 in 6 families with sickness (16.6 per cent) had deficits. ^See pp. 265-75. 297 (4) A large proportion of families with sickness in Class C carried a relatively high burden in sickness costs and over two-fifths were left at the end of the year with deficits. The family readjustments required to meet sickness losses, difficult to present completely by statistical data, have been described in terms of depletion of savings, of retrenchment and deprivation, of debt, of child and woman labor, of destitution and dependency, of physical ineffi- ciency and reduced economic power, of pauperization and family dis- integration. A brief discussion will now be given of the extent to which sickness causes poverty defined as income insufficient to meet the stand- ards of a subsistence budget. (b) Sickness as a Cause of Poverty. Of the 2,598 wage-earning families (excluding Class D) in the 41 blocks of our Family Study reporting income, 375, or 14.4 per cent, were assigned according to actual economic status to Class C, or the poverty group. These families with deficient incomes, could not, no matter how sober the husband nor how careful a housekeeper the wife, on the income received last year meet the requirements of the subsistence budget, nor, presiimably, maintain a minimum standard of physical efficiencv. Ninety-five, or 25.3 per cent, of the 375 poor families were in Class C because of disabling sickness during the year. If these 95 families had been safe-guarded, by whatever means, against the loss of wages and the costs of medical treatment consequent upon illness, their eco- nomic status above the level required for physical efficiency would have been maintained and one-fourth of the poverty in. these Chicago blocks would have been eliminated. An analysis of the normal economic status of the 95 families who were shifted by disabling sickness to Class C or the poverty group with income insufficient to meet the standards of a subsistence budget dis- closes significant details, as indicated by the following table : Normal economic status. Number of families. r Families shifted from Classes W, A, and B to Class C because of sickness costs. Number. Percent. Class W with liberal incomes 1,022 665 631 2 12 81 .2 Class A with moderate incomes 1.8 Class B with meager incomes 12.8 Of course these shifts have little significance unless supported by the sickness costs involved, for 81 of the 95 were from Class "B" to Class "C^^ where insignificant sums might account for the change from the one group to the other. The fact is, however, that in only 15 cases of the 95 were the costs less than $50, the average for the 15 being $27.43. As against these 15, there were 13 with costs of $50 but less than $100, averaging $76; 18 with costs of $100 but less than $150, averaging $118.39; 8 with costs of $150 but less than $200, averaging $177.75; 398 16 with costs of $200 but less than $300, averaging $243; 7 with costs of $300 but less than $400, averaging $326.43 ; 5 with costs of $400 but less than $500, averaging $452.60; and 13 with costs in excess of $500, averaging $653.92. In more than five cases in six the sickness costs which resulted in the placing of these families in the poverty group were sub- stantial sums, and in the majority of the cases where the amounts were small absolutely, they cannot be said to have been unimportant to the families concerned. These statistics but reinforce all conclusions that have been obtained from the different parts of the investigation. The incidence of sickness, its duration and costs, its results in the lowering of standards^ its poverty and dependency risks all fall most heavily upon families of lower economic status in the wage-earning group. A brief resume of the chief conclusions of the section on "Sickness as a Cause of Poverty" follows : 1. The conflicting estimates of the weight of sickness as a factor in dependency in the literature of research were found to be due to the absence of a common basis of comparison. By supplying this defect, it was found that Warner, Devine and the Immigration Commission are agreed in ascribing to disabling illness one-fourth of all reported causes or conditions of dependency. 2. The reports of eight charity organization societies outside of Chicago attribute to sickness chief responsibility in upward of one-third of the cases seeking relief in the year 1917-18. 3. On the basis of a study of the experience of charitable agencies in Chicago (covering eight years), sickness was charged with one-third to one-half of all the causes or problems entering into dependency. The higher dependency ratio assigned to sickness in Chicago than obtained from the literature of the subject was found to be due to the extensive unemployment during the period covered by the earlier investigations. 4. An intensive study by the Commission of 628 charity families visited in the Family Study indicated that the majority of these families had been economically independent prior to disabling illness, that the dependency risk due to sickness varied directly with the lower economic status of the family, and that chronic diseases including tuberculosis were responsible for two-fifths to one-half of all dependency resulting from physical disability. 5. In the investigation of 2,598 w^age-earning families (excluding Class D) in the block study, it was found that sickness caused a change of economic status in 343 families or more than one-eighth of the total number or approximately one-fifth of the families with sickness. It was found that lowered standards of living, apart from change in eco- nomic status, due to illness could be measured by deficits and variations in sickness costs and were manifested in savings used, in retrenchment and deprivation, in debts to physican, landlord and grocer, in loans from friends and commercial agencies, in destitution and dependency, in de- creased physical capacity, and diminished earning ability. Finally, it was found that one-fourth of the poverty in Chicago in 1917-18 in the wage-earning families of the block study, was accounted for by the loss of wages and sickness costs involved in disabling illness. 299 This review of the interrelation of sickness to poverty and de- pendency indicates that a constant and more or less definite fraction of poverty and dependency is to be charged to the disabling sickness of the wage-earner and the members of his family. VI. HEALTH INSUEAN^CE AS A SOLUTION. In the preceding sections the problem of sickness has been analyzed. Data bearing upon its duration, its costs, the care of the sick, and exist- ing protection against its risks have been offered for the block,^^ nursing service*^^ and charity^^ families. An intensive study has been made of tlie causal interrelations^^ between sickness and poverty and dependency. Xothing at all has been said about a solution for the problem. The question naturally arises, what difference would an organized system of health insurance have made ? Health insurance of course has many aspects. Some of these are not revealed by such investigations as have been made of wage-earning families in Chicago. However, the data were collected and tabulated in such a manner that the question raised could be partially answered. In so far as the data contain an answer it is set forth in this section of the report. Several health insurance measures have been proposed for consider- ation and 'adoption. The best known of these is the "Model Bill" drafted by a committee of the ^American Association for Labor Legis- lation. The measure most actively urged for adoption has been drafted by the New York State Federation of Labor. This measure has been accepted as the fourth edition of the "Model Bill." Unfortunately it is impossible to apply all of the provisions of either of the bills mentioned to our data. Under the circumstances a health insurance measure is here set up incorporating "standards" drawn from the one measure or the other and slio^ht modifications introduced where necessarv in order to adopt the standards to the purpose in view. The assumed system of health insurance here applied contains the following provisions : 1. All employed persons engaged in manual labor in the State and all other employed persons earning $100 a month or less are insured. 2. A sickness or cash benefit, equal to two-thirds {^^ 2/3 per cent) of the weekly earnings of the insured person is paid beginning with the eighth day of disability on account of illness or non-industrial accident. It is paid only during continuance of disability, and is not paid to the same person for a period of over twenty-six weeks in any consecutive twelve months, or for more than twentv-six weeks on account of the same case of disability. 3. All necessary medical, surgical and nursing service is furnished to insured persons and the dependent members of their families from the first day of sickness, or the occurrence of the non-industrial accident, for not more than twenty-six weeks of disability in any consecutive twelve months. =9 Sec 2. The Block Study, pp. 199-229. ««Sec. 3. The Nursing Study, pp. 229-239. 61 Sec. 4. The Charity Study, pp. 239-252. «2 Sec. 5. Sickness as a Cause of Poverty and Dependency, pp. 252-99. * 300 4. Insured persons and the dependent members of their families are supplied with all necessary medicines, medical and surgical supplies, dressings, eye-glasses, trusses, crutches, and similar appliances, pre- scribed by the physican or surgeon. 5. A burial benefit of not to exceed $100 is provided to cover the actual cost of burial of an insured person. It will be noted that neither maternity nor dental benefits are in- cluded in the measure here assumed. Maternity care would, however, be provided under the medical benefit. With all manual wage-earners and all other employed persons earning not more than $100 per month insured, what difference w^ould such a system have made in view of the facts obtained from our investigation ? The answer to this question, so far as available data permit, will be offered under the following heads : (1) Organized health insurance as a substitute for existing health insurance ; (2) Organized health insurance as a substitute for lowered stand- ards of living; (3) Organized health insurance as a preventive of poverty and dependency. (1) Organized Health Insurance as a Substitute for Existing Health Insurance. Under sickness costs it is desirable to consider separately direct outlays and lost wages. In the program of organized health insurance assumed, full medical provision is made for the first twenty-six weeks of sickness beginning with the first day, while the sickness benefit to the wage-earner with its maximum period of twenty-six weeks, does not begin until after a waiting period of a week. In order to apply to wage-earners and wage-earning families the medical and sickness benefits provided for by the assumed organized health insurance measure, it is necessary to determine the compensable and noncompensable periods for direct outlays and for lost wages. « (a) Direct Outlays of Wage-earners and Dependent Members of their Families. The data furnished by 901 wage-earners reporting one or more weeks lost from work because of illness indicate, according to Table 9,®^ that only 67 lost more than 26 weeks. By means of the comparison made possible by Table 31^* it is found that while 901 wage-earners lost a total of 6,143 weeks in the first 26 weeks period, the 67 wage-earners lost a total of 489 weeks in the period in excess of 26 weeks. On the basis of these figures the sum total of weeks of lost work by sickness for which direct outlays would be provided for under the medical benefits is 6,143, while 489 weeks of illness would not be provided for. In per- centages this means that the medical benefit would apply to 92.6 per cent but not to the remaining 7.4 per cent of the time lost by illness. With no data at hand to indicate the actual distribution of sickness outlays during the period of illness, it seems conservative and not inapt to assume their equal distribution throughout the entire time the wage-earner was «3 See p. 208. '^ See p. 301. 301 TABLE 31- -WAGES LOST BY WAGE-EARNERS IN TOTAL AND COMPENS- ABLE PERIODS OF SICKNESS. Block study. Nursing service study. Charity study. Total number of wage earners Number losing time because of sickness Number reporting time and wages lost Total number of weeks lost Number weeks lost minus one week Number wage-earners losing time in excess of 27 weeks Number of weeks lost in excess of 27 weeks Total wage earnings of those reporting Wages lost in 26 compensable weeks Lost wages of those reporting 4,474 937 901 6,6S2 5,731 42 422 $676,087 86,227 $107,338 409 116 115 737 622 1 9 $93,986 10, 127 $12,213 878 494 450 7,824 7,374 106 1,240 $183, 841 87,338 $104,493 302 absent from work because of illness. In the absence of the tabulation of the number of weeks of sickness of the non-gainfully occupied members of wage-earning families, it has been assumed that for medical benefit the compensable period is also 92.6^ per cent of the entire duration of sick- ness. As indicative of the validity of this assumption is the very close averages of direct outlays for sickness of the wage-earner ($35.64) and of the non-gainfully occupied ($35.87).^^ (b) Lost Wages. The compensable period for sickness benefit in lieu of lost wages is also twenty-six weeks but beginning at the end of a waiting period of one week. Table 30 indicates that of the 6,632 weeks lost by wage-earners, 5,309, or 80.1 per cent, were compensable, and that 1,323, or 19.9 per cent were not compensable. The weeks not compensable include 901 weeks accounted for by the one-week waiting period and 422 weeks in excess of the first twenty-seven weeks in a year. We may say, therefore, that roughly four-fifths of the time lost from work by sickness is com- pensable. But the compensation allowed by the sickness benefit is partial, not full, and for two-thirds of the wages lost. So the compen- sation for the total of wages lost, is,, under the assumed plan of health insurance, 53.4 per cent, or slightly dver one-half. (c) Compensation for Siclcness Costs. Of the $107,338 in wages lost by 901 Chicago wage-earners last year because of disabling illness, $86,227 was lost in the twenty-six compensable weeks (See Table 31). Of the $86,227, only two-thirds, or $57,484.67, would be covered by sickness benefit. Of the $24,749 in direct outlays for sickness by 1,019 wage-earners, 92.6 per cent, or $22,918 would have been provided for by the medical benefit. One thousand six hundred and sixty-seven wage-earning families giving complete sickness costs report $71,733 in direct outlays, hence $66,425 would be provided for under the assumed system of organized health insurance. Of the $91,607 in lost wages,*^® assuming 53.4 per cent compensation, $48,918 would be covered by the amount received under the assumed plan. Of total sickness costs amounting to $163,340 (of 1,667 wage-earning families reporting in full), $115,343 or 70.6 per cent, would be met by a system of organized health insurance. It seems, therefore, to be conservative to state that with other conditions un- changed seventy cents of every dollar of existing sickness loss to wage- earning families would have been met under the system of organized health insurance assumed. Assuming that the wage-earning families reporting completely their incomes and sickness costs are representative of the whole group of wage- earning families (2,708) in the blocks studied, it is possible to make estimates of total incomes from wages, total sickness costs, and totaj sickness losses compensable under organized health insurance for the 2,708 wage-earning families. ^ See p. 207. "•These families do not include all of the 901 wage-earners mentioned above. 303 Total income from wages of 4,295 wage-earners and 2,708 wage- earning families estimated at* $3,524,949 Total sickness costs (both direct outlays and lost wages) of 2,708 wage-earning families estimated (understated) at $192,295 Total sickness cost percentage of total income from wages 5.46 per cent Average total sickness cost per wage-earning family (somewhat understated) $71.01 Total sickness cost compensable under organized health insurance estimated at $135,760 Total compensable sickness cost percentage of total income from wages 4.1 per cent Average compensable sickness cost per family t $50.13 The computations just made, while based upon actual sickness costs during the year, do not, and of course could not, take into account sev- eral minor factors that in their sum total w^uld, to some extent, though not considerably, affect the percentage arrived at. Chief among these disturbing elements is the effect upon eligibility to full benefit rights of unemployment during the year due to other causes than illness. For the twelve months of the study, however, there was practically no unem- ployment due to lack of work. (d) Comparison Between Organized and Existing Health Insurance. The data in regard to existing health insurance as obtained from the block study^^ make possible a comparison between organized and existing health insurance. For wage-earners and their families in the block, nursing service and charity groups the costs of sickness have already been determined. Consideration here will be limited, however, to wage-earning families in the block study. A comparison of the existing health insurance with the assumed plan of organized health insurance will be taken up under the following heads : organization ; proportion of wage-earners insured ; relative protection of insured persons; of wage-earners with sickness, and of wage-earning families with sickness. Organization. — A chief characteristic of existing health insurance is its lack of uniformity. Insurance against sickness risk is provided in various forms by several different types of organizations. Fraternal orders are carriers apparently for approximately one-half of the policies providing disability insurance held by the block families. Employers pay half or all of wages in a considerable proportion of cases where benefits are received. Many workingmen are insured by commercial carriers, by establishment funds and by small independent associations for the most part to be found among immigrant groups. Membership rights in trade unions not infrequently include benefits in case of dis- abling sickness. This variety of types is a natural result of spontaneous and independent efforts to meet the risk of disability. The assumed system of health insurance involves, of course, coor- dination of the participating asso(?iations or societies and the standard- ization of benefits and of medical treatment provided. Proportion of wage-earners insured. — The proportion of wage-earn- ers insured under the assumed system of organized health insurance would probably range somewhere between 90 and 100 per cent. All wage-earners except the relatively small number not engaged in manual * Estimated from Table 4, pp. 196-97. t These figures do not include allowance for burial expenses. There were 16 burials of wage-earners during the year. The total outlay was $3,428 ; the com- pensable amount would have been $1,585. ^ See pp. 214-29. 304 labor and receiving over $100 a month would come under the provisions of the plan. According to the findings of our block study a much smaller proportion, or 23.7 per cent of all wage-earners and 36.7 per cent of all husbands of wage-earning families, Avere insured last year against risk of sickness or of sickness and accident. These percentages do not, of course, include that particular aspect of life insurance that may be considered sickness insurance. The life insurance benefit received at death from "old line'^ companies or from fraternal orders may be as a matter of fact regarded as providing for three contingencies — for expenses of last illness, for funeral expenses, and for the surviving members of the families during the period of readjustment. How^ever, as the last sickness is but one among many illnesses, provision for this risk is only one of minor significance. Relative protection provided insured persons. — The protection of health insurance includes both a cash benefit to indemnify, in part, wage losses and a medical benefit. The assumed plan of health insur- ance, as already shown, would have provided for 53.4 per cent of the wage-loss to the group of 937 wage-earners sick and losing more than one week from work. The disability policies or rights in force last year actually provided benefits of 44.1 per cent of the wage loss to 126 or 13.4 per cent of the 937 wage-earners sick and losing more than one week from w'ork. The facts that while 23.7 per cent of the wage-earn- ers were found to have disability insurance and that only 13.4 per cent of those sick received benefits cannot be entirely explained except by the inadequacy of existing provision. Under organized health insurance 100 per cent of the direct outlays for the first 26 w^eeks of the illness of the insured wage-earner (as well as of all dependent members of his family) would be covered. The present carriers of disability insurance with the exception of only a few establishments, certain establishment funds, a few fraternal orders and independent societies, provide no medical benefit. An industrial policy in the Metropolitan Life Insur- ance Company does, however, give to the insured person the right to limited nursing service through an arrangement with the Visiting Nurse Association. With the assumed system of health insurance in force last year, the average amount of weekly benefit for an insured person when sick would have been $9.61 ; the actual average weekly benefit provided in the health policies was $6.79. With the assumed organized plan the weekly cash benefit would be after a waiting period of one week uniformly two- thirds of the weekly wages for the duration of sickness not to exceed twenty-six weeks in any one year. Under the existing situation the maximum benefit period varies from five or six weeks to a year but is most frequently thirteen weeks. The cash benefits are in general not a proportion of wages (except where the employer grants half or full wages during sickness, or an establishment fund determines benefit by a percentage of wages paid), but a flat rate not closely related or un- related to amount of lost wages. For example, 978 out of 1,055 wage- earners made insurance reports showing that while the average benefit was $6.79, 70.3 per cent of the benefits provided w^ere for sums between 305 $5 to $9 a week inclusive, 10.9 per cent were for less than $5, 14.1 per cent for $10 to $14 inclusive, and 4.6 per cent for $15 and over. Relative protection of wage-earners with sickness. — The sickness losses of wage-earners include both lost wages and direct outlays. The total wage loss last year of 937 wage-earners losing wages is estimated®* at $111,277. The amount of this wage loss that would have been in- demnified under the assumed system of organized health insurance was calculated at $59,422, or 53.4 per cent. The estimated amount^^ actu- ally received by 126 insured wage-earners was $6,607, or 5.9 per cent of the wage lost. The total direct outlays of 1,100 wage-earners for medical treat- ments and medicines during illness have been estimated^*^ at $26,716. Of this amount $24,739, or 92.6 per cent, would have been covered, according to our computation, by the medical benefit provided under the assumed plan of organized health insurance. Figures as a basis for an estimate of the medical service now performed by the existing carriers of health insurance are not available. It is not feasible to assign a cash value to the services of the physician provided by the establishment fund or by the industrial enterprise, or of the nurse employed by an arrangement of an industrial insurance company with the local field nursing association. The amount, while considerable, would be, as indicated by the small number of wage-earners with these services, a relativelv small fraction of the total sickness costs. Relative protection of wage-earning families with sichness. — The total sickness losses (including both wages and direct outlays) for 1,744 wage-earning families w4th one or more members sick was estimated at $170,885.'^^ The amount of this sickness loss that would have been covered, according to our calculations, by the application of the assumed plan of health insurance was $120,645, or 70.6 per cent, as against $7, 601,*^^ or 4.4 per cent indemnified by existing health insurance. This latter sum and per cent, while including estimated amount of disability insurance received by non-gainfully occupied members of wage-earning families, is undoubtedly an understatement. As already indicated, a medical benefit is now provided by certain carriers of disability insur- ance, the amount of which, while known to be not relatively large, can- not be definitely or even approximately estimated upon any satisfactory basis. The disadvantageous situation of poor families (Class C) under existing health insurance has been repeatedly indicated already.''^ (2) As' a Preventive of Lowered Standards of Living. Two statistical methods employed to show lowered standards of living among block families were by high sickness costs and by deficits. «» Estimated on basis of 906 reporting wage-losses of $107,595. See Table 14. p. 219. "Estimated for 126 wage-earners on basis of 125 receiving $6,555. See Table 14, p. 219. "Estimated for 1,100 (of 1,222 sick) on basis of 1,019 reporting completely. Sec Table 7. p. 206. '* Estimated on the basis of 1,667 of these families reoorting $163,340 sickness costs. " An estimate including benefits received bv non-gainfully occupied members of 1,744 wage-earning families, estimated at $994. '^ See pp. 204, 209, 211, 213, 220, 222, 226. 227. 231. 233. 235, 277, 278, 290. —20 H I 306 It seemed desirable, therefore, to calculate the approximate elimination or reduction of sickness costs and deficits by applying the standards of the assumed system of organized health insurance. Since the group of 343 families experiencing a downward shift in economic status represent, on the average, higher costs of sickness than the entire body of wage-earning families, it was chosen to illustrate the effect of the application of the health insurance system assumed. The following table shows by illness of the members of the families the percentage of sickness costs that would have been covered by the cash and the medical benefits received according to the standards of organ- ized health insurance assumed for the purpose of this study. Member or members of the family where illness was chiefly responsible Total cases. Percentage of total family sickness costs compensable by an assumed system of organized health insurance. for sickness costs. 1-24 25-49 50-59 60-69 70-79 80-89 90-99 KG Normal bread winner (father only) Mother, only 165 74 22 21 3 24 11 2 5 1 2 13 .----. 13 3 1 25 2 1 54 7 7 1 38 2 6 22 2 2 2 2 1 2 1 11 58 Wage-earning child or children Unemployed child or children 2 17 Dependent relative 3 Normal bread winner (father) and mother Normal bread winner (father) and wage- earning child or children 1 2 2 5 1 1 1 7 3 1 13 1 1 3 1 Normal bread winner (father) and imem- ployed child or children Normal bread winner (father), mother and unemployed child or children Normal bread winner (father), mother and wage-earning child Mother and wage-earnihg child or children Mother and unemployed child or children 1 1 1 12 Total number 343 100.0 ""o.'o 18 5.2 31 9.0 79 23.0 58 16.9 46 13.4 2.0 104 Per cent 30.3 This table indicates that, by an application of the standards of the assumed system of health insurance, all of the 343 families would have had at 'east twenty-five per cent of their sickness costs covered and that approximately three tenths (30.3 per cent) of the families Avould have had their losses covered in full. The cases where the entire costs of sickness are indemnified, involve, of course, no wage-loss and are, in general, as the table shows, those of the non-gainfully occupied members of the family. In only 14 out of 104 families where losses would have been compensated in full was the illness of a wage-earner partly or wholly responsible for the sickness cost. This distribution of families by percentage of sickness costs covered is significant. All but slightly less than 19 in 20 families (94.8 per cent, according to these figures, would have had at least half of their sickness losses covered; somewhat more than 17 in 20 families (85.8 per cent) would have had at least three-fifths of lost wages and direct outlays compensated. A comparison of the proportion of sickness losses indemnified by the particular member of the family whose illness was responsible, shows naturally that sickness costs would be covered in full in relatively few families where wage-earners were sick. In the 165 cases where illness of 307 Avage-earniiig husband (the normal breadwinner) was primarily re- sponsible for sickness costs, the largest number (54) is grouped under 60 to 69 per cent of losses compensated. Even in this group, however, it is calculated that organized health insurance would have met at least half of the costs of sickness in 92.1 per cent and at least three-fifths in 77.0 per cent of the cases. As significant as the elimination and reduction of sickness costs would be the probable effect upon deficits of the application of the stand- ard cash and medical benefits of the assumed system of health insurance. The following table shows the shift in the range of the amounts of deficits from the actual situation last year to the hypothetical condition under the assumed system of organized health insurance. Deficit as affected by the introduction of the assumed system of organized health insurance. Per cent of Range of deficit in wage- earning families dur- ing year of study. Total num- ber. Num- ber cov- ered. Number not covered classified by varying amounts of deficit remaining. deficits covered or of deficit Un- der $50. $50 to 99. $100 to 149. $150 to 199. $200 to 299. $300 to 399. $400 to 499. $500 and over. remain- ing under $50. Under $50 65 50 34 9 32 14 4 14 56 29 11 6 11 2 1 1 9 16 5 6 1 100.0 $50-$99 5 13 1 5 1 1 90.0 $100-$149 5 1 1 1 47.1 $150-$199 1 5 2 66.7 $200-$299 4 6 53.1 $300-$}99 1 2 21.4 $400-$199 ' 25 $500 and over 2 4 7 7 1 Total 222 117 52.7 37 16.7 26 11.7 8 3.6 8 3.6 12 5.4 3 1.4 4 1.8 7 3.1 69.4 Per cent Certain significant facts are shown in this table. 1. Over half the deficits (52.7 per cent) would have been covered had the assumed standards of organized health insurance been in force during the year of the study. 2. Practically 7 out of every 10 deficits (69.4 per cent would either have been eliminated (52.7 per cent) or reduced to an amount under $50 (16.7 per cent) carried, in most cases, without great economic in- convenience by the family. 3. The proportion of deficits entirely covered or reduced below $50 by indemnification of sickness costs under the assumed system of health insurance naturally varies with the amount of actual deficit during the year as follows: under $50, 100 per cent; $50-$99, 90 per cent; $100- $149, 47.1 per cent; $150-$199, 66.7 per cent; $200-$299, 53.1 per cent; $300-$399, 21.4 per cent; $400-$499, 25 per cent, $500 and over, 7.1 per cent. In analyzing these figures it should be kept in mind, as already shown/* that all of the deficit incurred is not necessarily because of sickness costs. - The calculation of deficits as worked out in the above table prac- tically took for granted that the additional outlay for premiums from "•* See pp. 290-91. 308 wage-earning families to carry the costs of the assumed system of organ- ized health insurance would have had no effect upon deficits. This assumption is probably correct for the great majority of wage-earning families. An added but foreseen outlay, especially if distributed throughout the year, can be met by a readjustment of expenditures without necessarily creating a deficit. The purchase of Liberty Bonds by wage-earning families who previously had succeeded only in making ends meet did not create many family deficits. It is the added but un- forseen outlay, such as that of sickness costs, which results in the sum of outlays in excess of family income. Nevertheless, the cost of administering an assumed system of organ- ized health insurance cannot be ignored, and the effect of its introduction upon deficits, if other expenditures had remained the same is a matter of interest though not of decisive importance. It will be recalled that last yearns sickness costs compensable under the assumed plan were calculated at 4.1 per cent of the total wage income of the entire group of 2,708 wage-earning families in the blocks studied. Despite economies possi- ble under unified organization and the possible though uncertain re- duction of the duration of sickness because of the more adequate treat- ment provided, the per cent of cost to wage income would probably have been closer to 5.0 than to 4.0 per cent of wages. This increase would result from the additional expenditure required to carry existing free medical service, from the provision of medical facilities and treat- ment more adequate than those existing, and from the probable in- crease in the average number of weeks lost from work because of the right to cash benefit during disabling illness. Assuming that 2.5 per cent (half of the cost) was charged against the wage-earner and the other half charged to industry, a calculation was made of the effect of this added outlay in connection with benefits provided under the assumed plan upon the deficits of the 222 families without any other change in expenditures. It was found that of the 222 families with deficits, the deficit would have been covered in 96 or 43.2 per cent of the cases (as compared with 52.7 per cent where no additional outlay for cost of the system was assumed). The deficits with allowance for the cost of the premiums would have been under $50 in the case of 33 families or 14.9 per cent of the total number (16.7 without premium) ; $50 but less than $100 in 32, or 14.4 per cent (11.7 per cent without premium) ; $100 but less than $150 in 11.4 per cent (3.6 per cent without premium) ; $150 but less than $200 in 2 or 0.9 per cent (3.6 per cent without premium) ; $200 but less than $300 in 17, or 7.6 per cent (5.4 per cent without premium) ; $300 but less than $400 in 5, or 2.2 per cent (1.4 per cent without permium) ; $400 but less than $500 in 2, or 0.9 per cent (1.8 per cent without premium) ; $500 and over in 10 or 4.5 per cent (3.1 per cent without premium). These calculations of the effects of the hypothetical application of the assumed standards of organized health insurance to the actual economic experience of wage-earning families have, of course, obvious limitations. The figures as given for sickness costs and deficits repre- sent the theoretical expectation, based upon sickness losses under exist- 309 iug conditions, of the situation under the assumed plan and must, accordingly, be taken only as presumptive and indicative. (3) As a Preventive of Poverty and Dependency. So far as poverty is considered as a relative matter, as a reduction in income or as an unusual and unprovided for outlay sufficient to require a radical adjustment in habits of expenditure, its condition as a result of sickness and as affected by the substitution of an assumed organized system for existing health insurance has just been considered under the discussion of the prevention of lowered standards of living. But poverty may also^^ be defined more objectively as existence below a minimum subsistence standard of living. The families in our block study in Class C are those whose incomes are insufficient to meet the requirements of a conservatively estimated charity budget.^^ The number of families in Class C according to normal economic status (actual income plus wages lost because of sickness) was 280. If the actual economic status (actual income minus direct outlays due to illness) of the families be taken the number of families in Class C is increased to 375. This additional num- ber of families, 95, represents those in Classes W, A and B who Avere de- pressed into poverty because of lost wages and direct outlays due to sick- ness. The application of the assumed standards of cash and medical benefits to each of these 95 cases in turn indicates that only 16 or 16.8 per cent would have been submerged below the minimum requirements of subsistence had organized health insurance been in force during the year. When combined with the data relating to the causes of poverty, this means that somewhat more than one-fifth of the poverty in the block wage-earning families would have been eliminated had the assumed system of health insurance been in force. On the other hand, the premium charged (2i/2 per cent of wages) would have depressed 6 or 1.0 per cent of the B families below the poverty line. The figure (6) and the figure (79) given above for families that would have been kept above the poverty level show the net effect the system assumed would have had upon the number of these families in the poverty (Class C) group. The consideration of the effect of the application of the assumed system of health insurance upon the reduction or elimination of de- pendency falls under two heads — medical charity and general charity defined as material relief. Application for free medical service, no matter how disguised, is, in fact, an appeal to charity. Of 2,005 wage-earning families with sick- ness in the blocks studied, 13.6 per cent had free service of physician, 6.1 per cent free nursing service, 10.0 per cent free hospital care, and 11.3 per cent free dispensary treatment."^^ At least one member of 588 families, or 29.3 per cent of the 2,005 families with one or more cases of sickness, secured some form of free medical service during the year. Moreover, there were a considerable number of other cases where the fees paid for the nursing or the dispensary service would cover only a part of the cost of providing it. These are semi-charity cases. "Page 286. T« For a fuller explanation, see pp. 185-88. "fifee p. 243. 310 * This large proportion (nearly three of ten families with sickness) which were found to have secured free medical treatment represents need rather than abuse. At any rate the dispensary study showed that less than one family in twenty was financially able to have paid for the kind of service obtained.'^^ The assumed system of health insurance would provide for the insured wage-earner and for the dependent mem- bers of his family all necessary medical benefits not to exceed twenty- six weeks of disability in any consecutive twelve months. We come finally to the question, how far Avould the assumed system of health insurance have reduced the number who were granted material relief? Or, in different words, to what extent would the assumed system have prevented dependency? The data obtained from the investigation of families included in the Block Study may be brought to bear upon this question. Of 2,708 wage-earning families studied, 50 were found to have received material relief during the year. In 6 of these 50 cases there had been no sick- ness; the dependency was the result of other causes. It was found, moreover, that while sickness entered into 14 other cases, it was of minor importance; the other factors present would have reduced the families to dependency anywa}', and the only ameliorative effect of health insurance would have been to reduce but slightly the extent to which they relied upon material relief. It was found, in the third place, that disability due to chronic disease of the normal breadwinner was the cause of dependency in 16 cases. In 9 of these 16 cases the normal breadwinner had not been able to work at all during the year, and usually for a longer period of time. Unless it carried with it invalidity benefits considerably in excess of twenty-six weeks, health insurance would have made little or no differ- ence in these cases. As against these, there w^ere 2 cases in which the normal breadwinner, though suft'ering from chronic illness, continued in employment with such regularity that he would not have been entitled to a cash benefit in partial compensation of his regular earnings, which were no doubt reduced by impaired efficiency. Finally, there were 5 cases in which the normal breadwinner was employed a part of the time and would have been entitled to a cash benefit when disabled. How far his losses would have compensated it is impossible to estimate, because the irregularity of his employment leaves doubt as to the extent of his insurance rights. It is evident, therefore, that the assumed system of health insurance would have prevented little of the dependency due to chronic illness, unless the medical care provided under it proved effective in preventing the illness or in reducing its seriousness: In the fourth place, and finally, there were 14 cases in which dependency was due to the acute illness of the normal breadwinner or other member of his family. In 4 cases the assumed system of health insurance with its cash and medical benefits (and premium of 2.5 per cent charged against wages) would have been insufficient to cover the material relief granted by charitable agencies, unless the system was effective in reducing the seriousness of the disability. There remain, "Special Report III. 311 then, only 10 cases where dependenc}^ would have been prevented, had the assumed plan been in force. In the light of this examination into each case of dependency among the wage-earning families in the blocks, we may briefly analyze the data gathered in our charity study and in the survey of the experience of Chicago charitable agencies. Of the 628 families investigated in the charity study,^^ physical disability other than that resulting from industrial accident was assigned as the cause of dependency in 409 or 65.1 per cent of the cases. Among these 409 cases there were 307 where the chronic disability of the normal wage-earner was ascribed as the chief cause of dependency. In 76 of the 307 families where the normal breadwinner had been unable to work at all during the year, and, in many cases, for a much longer period, little or no benefit under the assumed system of organized health in- surance could have been expected. In 106 additional cases where the period lost from work was in excess of the twenty-seventh or final com- pensable week in the year, a considerable part of the sickness cost, assum- ing eligibility to benefit, would have been entirely unindemnified. How- ever, in these 106 cases, as well as in the remaining 125 cases where the time lost from work was less than twenty-seven weeks, the question of eligibility to full benefit rights is crucial. Many of them are of the casual labor type and a large percentage of them would doubtless fail to maintain full benefit rights. At any rate, without the inclusion of an invalidity cash benefit extending over a much longer period than 26 weeks, health insurance would merely postpone and not prevent the appeal to charity in practically all cases of chronic disease. There remains, finally, the group of 102 families where acute illness or injury from non-industrial accident of the normal breadwinner was the cause of dependency. As already seen in the study of dependency in the block families, the appeal to charity in not all, but in the greater number of these would probably have been prevented. The experience of the United Charities for eight years may be con- sidered in this connection. In from one-half to two-thirds (according to the year considered) of the problems involved in dependency, sick- ness as a condition, does not enter. The average of the proportion of dependency charged to physical disability (excluding industrial accident), for the eight year period is 36.7 per cent,^*^ or • approximately three- eights. During these eight years the ratio of chronic to acute cases was 46.7 to 53.3.^^ If the conclusions arrived at above may be applied here, it is doubtful whether the assumed system of health insurance would have proved to be a complete substitute for charity in as many as one-half of the cases where material relief had been granted because of disabling sickness. We may, accordingly, expect a reduction of not to exceed one-half in dependency caused by disability and of not to exceed three- "The statistics in this paragraph are based upon data presented in Table 28, p. 269. «>For the eight year period, the average proportion for physical and mental disability was 40.2 per cent, from which 3.5 per cent is subtracted for mental disability and industrial accident. See Table 26, p. 259. " See Table 27, p. 264. 312 sixteenths in all dependency. Indeed, the actual outcome might fall con- siderably short of this estimate. The findings in this section may now be summarized. (1) The effect of the introduction of a system of organized health insurance would have had its most marked result in affecting the dis- tribution of the burden of sickness losses, in covering sickness costs and in eliminating or reducing deficits: (a) Approximately 70 per cent (as compared with about 6 per cent under existing health insurance) of last year's sickness costs in the block wage-earning families would have been covered at a cost, when distributed among all wage-earning families, of 4.1 per cent of wages received plus such allowance as would be required for administration, enhancement of costs, etc. (b) Of the 343 families experiencing downward shifts in economic status, 30 per cent would have had sickness costs completely covered, and approximately 85 per cent would have had them either covered or con- siderably reduced (60 per cent and over). (c) Deficits would have been eliminated in 52.7 per cent of the families with sickness failing to make ends meet (43.2 per cent if allowance were made for premium of 2.5 per cent charged against wages to cover the cost of the assumed system) ; deficits would have been elimin- ated or reduced to amounts under $50 in 69.4 per cent of these families (58.1 per cent with allowance for premium). (2) The assumed system of health insurance would have prevented' a considerable proportion of poverty and dependency caused by sickness, but a relatively small percentage of all poverty and dependency: (a) The reduction in poverty caused by the year's sickness would have been about three-fourths, in all poverty about one-fifth. (b) The highest reduction to be expected in the cases of dependency caused by sickness is one-half, and in all cases of dependency three- sixteenths. The findings of this section are not presented as absolutely con- clusive and final. They must be weighed in the light of the necessary limitations of the hypothetical application of assumed standards to an actual situation considered as unaffected by their introduction. Again, the evidence presented is largely circumstantial and presumptive, and should be accepted with due reservation for this fact. Moreover, in several instances the numbers upon which the findings have been based are small. While larger numbers probably would not materially affect the result (attested by the coherent testimony of the separate studies of block, nursing service, and charity families), they would have strength- ened the conclusions. While the data, then, cannot be regarded as sufficient to establish beyond question the findings arrived at above, they have been presented in some detail because they are suggestive, indicative and probable upon points of interest to the Commission and the public. 313 APPENDIX A. FAMILY SCHEDULE. On list of. Schedule number Investigator Date HEALTH INSURANCE COMMISSION. Family Schedule, F. 2. Nationality of family- Name, Address. House or apartment. Front or rear. Floor. Number of rooms. Number of persons. Condition of house : Good — fair — bad ; Clean — dirty — filthy. Rent per month. 4. Family Status and Employment. Members of Sex. Age. ■ Present or usual employment. Average earnings per week. Weeks unemployed last 12 months because of Earn- ings last 12 months. Number of em- ployers family. Sickness. Other reason. during last 12 months. Father Mother Children: 1. 2 t , 5. 6 5. Other sources of income (specify) 6. Total family income last year? Surplus or deficit?. 7. How was deficit met? (enter relief in full) 8. Value of property owned Encumbrance on same, 9. Other indebtedness 314 10. Sickness during last 12 months. Members of family. Nature of illness. Dura- tion. Doctor em- ployed (Co. or other). Doctor bill. Hospital care (name). Hospital bill. Nursing care — by whom and cost. Father Mother . . Children: 1 2 3 4 5 • 6 11. Dispensary record during last twelve months. Names of dispensaries visited with number of visits to each. Nature of ailment. Nature of treatment. Dispensary charges. Members of family. Admis- sion fee. Charge for medicines or operation (specify). Father ! Mother Children: 1 2 3 , . • 4 5 6 12. Doctor's fee for house visit. Office visit. Cost of medicine for the year. 13. How is dental work secured? Cost of dental work for the year?. 14. Note any neglect of dental work, 315 15. Insurance. Life insurance. Sickness insurance or sick fund. Members of family. Amount carried. Name of com- pany. Type of company — industrial, fra- ternal order, union, etc. Weekly premium. Name of carrier or fund. Weekly premium. Weekly benefit. Father Mother Children: 1 2 3. . 4 5. 16. Note lapses of insurance policies with reason, 17. For each member of family who received insurance during the last twelve months, specify amount received and state what was done with life or in- dustrial insurance policies paid. 18. What, if any, provision is made by any of the above institutions (in "15") for medical or nursing care?. 19. Has any death occurred in family in past year? If so, cost of burial?. 20. Has a child been born in family during past year? Physician or midwife employed?. , Fee of same. Nursing care and fee. Hospital service. Hospital bill. If employed, number of weeks absent from work before confinement?. If employment resumed, number of weeks after confinement?. 21. Note here any significant facts not entered above, such as: (a) illness of long standing and doctors employed and bills; (b) connection of doctors with dispensary; (c) quack doctors and patent medicines; (d) delay in securing treatment with reason; (e) attitude towards dispensary; (f) changes in standard of living due to sickness (moving to cheaper quarters, wife or children taking employment, etc.) ; (g) charity record, including date of first application and any information bearing on the cause of the situation, the income per' month while helped by charity during present emergency, etc. All of these points may possibly be combined into a story. 316 APPENDIX B. INSTRUCTIONS FOR INVESTIGATORS. General. The General Assembly of Illinois by Act approved June 23, 1917, created a special Health Insurance Commission. It is collecting data for its report. Data collected are for scientific use only ; all information must be regarded as confi- dential. In all cases these things should be explained and persons interviewed should be told that the facts given by them will not be used except in making up general tables. It should be made clear, also, that this is a government investi- gation. Each agent collecting data will have proper credentials, countersigned by the Governor of the State. Agents should secure accurate information bearing upon such points as find place in this schedule. Be careful to set down everything you learn of any importance for the purpose of the investigation. Pertinent infor- mation not fitting into any special place should be entered at the end of the schedule. Those collecting data for the commission should seek to develop the cooperative spirit on the part of those interviewed. Unless this is developed good data can- not be secured. Thought, patience, tact, and courteous treatment are indispensable. Investigators must not demand anything ; they should be able to command every- thing because of the tremendous importance of the data to everybody. Every question mwst have an answer. Where information cannot be ob- tained, write in "n.r." for no report. Where the question is not in point, either because of the answer to a previous question or for other reasons, draw a dash in the space for the answer. Write so that entries can be read. Detailed Instructions. "On list of" means United Charities, Central Free Dispensary, Block 4700 South Halsted, etc. Schedules of each investigator are to be numbered consecu- tively, beginning with 1. 1. Nationality. If white and native born, enter "U. S. White ;" if colored, enter "Negro;" if foreign born enter, as a rule, country of birth (e. g. Italy) but in case of Austria and Russia indicate race by entering "Russian Jew," "Galician Pole etc," Country of birth or race of father determines entry. 2. Enter H. or A. A house is a one family dwelling. The two following entries are not to be filled out for house : F. or R. (Front or rear). This refers to location of apartment in the house. If a middle or through apartment is found write that in. If apartment is in a rear house, that may be indicated by giving first location in the house and adding "R. H." Enter B or floor number. Enter number of persons including lodgers. 3. Enter G, F or B and C, D or F. 4. Enter only children living at home and children who have died within the last 12 months. Names of children should be entered and in order of birth. If father, mother or child is dead, enter that fact with date of death in space im- mediately following name. Present employment, earnings per week, lost time, and yearly earnings can be worked together. Average earnings per week means at present or when on last job. In general, the weekly and yearly earnings should check when proper allowance is made for unemployment. One exception to this is when the rate of pay has changed during the year ; another when women and children have started to work during the year. Either fact should be explained in note. If unemployed write in "unemployed" and give usual employment. If present employment differs from usual, give both. Give specific nature of job and industry, e. g. Laborer-Stock Yards. If man changes employers frequently enter "Casual" e. g. Labor-casual. Enter "o. a." if in business for self, e. g. "Grocer-o. a." Weeks unemployed is to be filled in for wage-earners only. Weeks unem- ployed because of sickness refers to sickness of wage-earner only. Unemployment because of sickness of others should be entered under "other reasons." "Other reasons" — do not specify reason. Give total weeks unemployed. Notice this does not include single days unemployment. Members of the family who did not start work until some time within the year are not to be counted unemployed for the time when that was their normal condition. If they work because of sickness of wage-earner, be sure to note that fact under "21." Number of employers during year-not jobs. Names of employers not wanted. 5. Enter amount from each source. Probable sources are boarders or lodgers, rent from property, insurance policies, sick benefits. Do not include relief or gifts. 6. Total family income will normally equal sum of earnings in 4 plus 5. When there are children of legal age whose earnings are not contributed to family in- come, put their contributions under 5 and explain in note why 6 does not equal 4 plus 5. Surplus or deficit — give amount. Where deficit is made up by relief in kind, estimate value if possible ; otherwise itemize things actually received. 7. Specify amount from each source ; get relief from U. C. from their records. Notice that other indebtedness (9) is repeated here unless incurred previous to last year. 8. Enter only value of real property owned. 9. Bills overdue but not current bills are to be entered. Specify nature and amount of each debt, e. g. "grocer, $20." 10. Make some entry for every member of family in order used in 4. Names need not be re-entered. Answer every question for every sickness. If one member of the family has had more than one sickness, use two lines and change number- ing at sides. As to what constitutes sickness, the investigator must use his best 317 judgment. Do not enter minor chronic complaints such as ordinary rheumatism, indigestion, etc., which do not incapacitate patient for usual work. Serious com- plaints such as tuberculosis should of course be entered even though patient is still at work. In other cases, do not count a wage-earner ill unless he is in- capacitated for work for a week or more and do not count others ill unless they are confined to bed for that same time. Exceptions to this rule should of course be made in any case of any important shorter illness, as e. g. removal .of tonsils. Maternity cases, including abortions, etc., are not to be included here but listed under 20. Duration. Usually time lost or confined to bed. Express in weeks. Cases in which patient is partially incapacitated present more difficulties ; duration may be counted from time patient stopped his usual for lighter work, from time of diagnosis if there is reason to think it was diagnosed reasonably early, or from time when patient first complained. If duration is over a year, express in years and months. Doctor. Specify county or other. Do not enter name of doctor. 11. Make entry for every member of family as in 10. Enter visits for ex- amination as well as for treatment. Nature of treatment. Be as specific as possible. 12. This means fee for each visit. 15. Make entry for each member of family under both life and sickness in- surance. Include insurance at present carried and insurance carried at time of death for members of the family who have died in the past 12 months. Care should be taken to get accurate information on these, questions. Amount. If children's insurance varies with age and length of time policy is held, give minimum and maximum. Name of Company. If there is not space to write out name, abbreviate and explain abbreviation in foot-note except for well-known companies, e. g. "Pru- dential," "Metropolitan." Under sickness insurance, weekly benefit means the benefit called for by the policy not the benefit actually received. Enter the amount of cash benefit and add "And medical attention" or whatever is necessary to indicate the rights of the insured. If more space is needed write "note" and describe fully at end of schedule or bottom of page. 20. Include still births, miscarriages and abortions. Enter "P" or "M." If nursing care given by association, e. g. "VNA" — specify. Enter name of hospital. 318 SPECIAL REPORT II. A STUDY OF THE DISABILITY DATA OF A SELECTED GROUP OF ASSOCIATIONS IN THE UNITED STATES. (H. W. Kulm, Ph. D.) [Note hy the Secretary. — This special report sets out dates collected relating to th« morbidity experience of establishment funds and other mutual organizations. The statistics contained in Part I were gathered by the Health Insurance Commis- sions of Ohio, Connecticut, Pennsylvania and Illinois. The statistics in Part II are for the Workmen's Sick and Death Benefit Fund of New York. Through the cour- tesy of Commissioner Royal Meeker of the United States Bureau of Labor Statistics, these data were compiled by the bureau and made available for use by the several state commissions. The collection and interpretation of the data have been done under the direc- tion of Professor H. W. Kuhn of Ohio State University and the report has been prepared by him. The tables presented add greatly to our knowledge of American sickness experience.] To estimate the cost of the cash benefits in a health insurance system paying sickness and non-industrial accident benefits, it is necessary to determine, as accurately as may be, the sickness and non-industrial accident rates for the groups of persons to be insured over the period during which benefits are to be paid. In this study the experience of organizations in the United States is used exclusively in attempting to determine these rates. It was impossible, of course, to make, within one year, a careful study of all the disability data available in this country and so it was necessary to select the group to be studied. In making this selection the Ohio Commission was fortunate in having the assis- ance of representatives of the Connecticut, Illinois and Pennsylvania health insurance commissions, as well as that of Mr. Boris Emmet, of the United States Bureau of Labor Statistics. NATURE OF THE DATA STUDIED. The study is divided into two parts. In Part I, with the exception of Table III, only cases of sickness and non-industrial accidents are used; in Part II, cases of industrial accidents are also included. Part I is based upon a study of 13 organizations. Association No. 11, however, is included only in Table I. An intensive study was made of the experience of compensated cases in 12 associations. For the pur- poses of this study the experience of three small associations is com- bined and is represented by Association No. 7 which, however, appears only in Tables V and VI. The data collected represent the experience over a period of 3'ears, varying from two to five, in the various associa- tions. Nine of these associations have their headquarters in Ohio, one in Illinois, two in Pennsylvania and one in Connecticut. The data rela- tive to the associations were secured by their own state health insurance commissions. Throughout the study the number of members, except in 319 Association N'o. 1/ is obtained by summing the annual average member- ships for the years covered. The number of cases is obtained in the same way. On this basis the total membership of the nine principal associations studied in Part I is 663,163 and the total number of cases of disability studied is 131,921. Only cases of disabilit}' lasting eight days or more were studied. None of the associations had a waiting period longer than one week and those associations with a shorter wait- ing period than one week are represented in this study only by cases lasting eight days or more. The benefit associations studied in Part I include employees in the following occupations: railroad transportation, manufacture of iron and steel products, textiles, general foundry work and letter carrying. These occupations with the exception of textiles, employ almost no women. The experience^ therefore, relates almost entirely to men. One association, however, (No. 8)' contains both men and women members. The distribution of cases of disability among men and women is presented in Table IV. The information from these organizations does not lend itself, readily at least, to a studv based upon the age of the members and no attempt was made to include this important element. Part II is a study of the data of the Workmen's Sick and Death Benefit Fund, a large association with headquarters in New York City, organized in 1884. The data represent the experience of the years 1912 to 1916 inclusive. The number of members and of cases, computed as in Part I, are respectively 184,985 and 43,488. The records of this association permit of a study of all cases of sickness lasting from one day to one year, as well as of those lasting more than seven days. It was also possible to tabulate these data so as to show disability by occu- pations and by ^ge groups. It was not possible, on the basis of the information furnished, to study sickness for each sex separately, but from the occupations of the members it is evident that the data relate largely to men. The study is presented largely in table form with some explanatory statements to make their meanings clear. The tables are of the follow- ing types : First — Tables showing the numerical distribution of cases by days of disability (Part I, Table I; Part II, Tables I and II). Second — Tables exhibiting the distribution of cases on a basis of 10,000 cases for each separate study and on a basis of 100,000. cases for the combined studies. Changing from the actual number of cases to 10,000 or 100,000 not only simplifies the study of the separate distribu- tions, but also facilities comparison and combination (Part I, Tables TI, III, IV, V and VI; Part II, Tables III and IV). Third — Tables summarizing the important facts obtained from a studv of the material collected (Part I, Table VII; Part II, Tables V, VI and VII). ^ Lack of time to complete the tabulations made it necessary to determine the membership of No. 1 by the actual number of cards handled. 320 METHOD. All distributions, except one, shown in the various tables are based upon compensated cases, and this one (Part I, Table I, No. 11) is not used in any of the other work. It should be noted, however, that these distributions are given with respect to the actual number of days dur- ation of the cases and not with respect to the compensated number of days i. e., the actual days of disability for cases lasting eight days or more is given and not merely the days of disability after the expiration of the waiting week. A definite range for all cases of sickness studied has been used throughout in calculating the average number of days of disability per case and per member per year. The range chosen includes all cases whose duration is eight days or more ; cases lasting longer than 189 days are included in the 189 day cases. For the cases of disability studied, the days of disability occurring within the first week are included. From the total days of disability thus ascertained, the average number of days disability per member has been determined. This, however, does not present the average days of disability for cases of all durations, but only for cases lasting eight days and over, inclusive of disability up to 189 days. Hence, it is less than the actual number of days disability per member. From the tables given in Part I and Part II it is possible to determine for other ranges the average duration of disability per case and per member. It is also possible to determine the days which would be compensated as the result of various waiting periods and lengths of time for which benefit might be payable. In comparing the study made in Part I with that made in Part II, it should be noted, as stated above, that Part II includes industrial acci- dents, while Part I does not. Attention may be dii^cted to two im- portant considerations. First — The distribution of 100,000 cases of disability by duration of disability is slightly different. In Part I only cases lasting eight days or more have been studied; in Part II, Table III, cases lasting seven days and more are included. Notwithstanding this slight variation, the distributions of the cases of short duration are in close agreement. Second— Th.Q average number of days of disability per case and per member are not strictly comparable with the corresponding figures in Part I since the disability rates for the Workmen's Sick and Death Benefit Fund include disability due to industrial accidents, while the data for the associations of Part I do not. This variation naturally increases the days of disability per member in the Workmen's Sick and Death Benefit Fund. The rate for this association is 6.3 days per member per year; the corresponding rate arrived at in Part I representing the com- bined experience of the associations is 6.0 days. Inasmuch, however, as the membership of the Workmen's Sick and Death Benefit Fund of America includes relatively few workers engaged in really hazardous industries such as iron and steel, construction, etc., the extent of indus- trial accidents among them is, it is thought by the tabulators of the data, relatively small. Eeference to the occupational classification of the mem- 321 bership shows that the bulk of the members are skilled mechanics work- ing in relatively small establishments.. SUMMARY OF FINDINGS. The data presented in Parts I and II show clearly that the bulk of the cases of disability are of short duration. Out of 100,000 cases of sickness and non-industrial accident lasting eight days or more, inclusive of disability up to 189 days, 34,660 lasted from eight to 14 days (Part I, Table VI) ; out of 100,000 cases of sickness, non-industrial accident and industrial accident combined, 34,321 lasted seven to 13 days (Part II, Table III). The cases of short duration are so numerous that not- withstanding the shorter duration per case, the cases of short duration account for more days of disability than the smaller number of longer cases. For example 34,660 cases lasting eight to 14 days account for 381,260 days of disability (including the first seven days ) ; 19,516 cases lasting 15 to 21 days account for but 351,288 days of disability. These two groups of cases account for 20.7 per cent of all the days disability among cases lasting eight days or more, inclusive of disability up to 189 days. This fact has the ntmost significance for a system of health insur- ance. It means that the compensation of the relatively small number of cases of long duration, for which compensation is most needed, does not increase the expenditure for cash benefits in proportion to the days duration per case. An analysis of the distribution of 10,000 cases each of sickness and of non-industrial accident in the same associations (N'os. 6 and 4) shows similiar distributions (Part I, Table II). Analysis of 10,000 cases each of sickness and non-industrial accident combined and of industrial acci- dent from the records of another association (No. 1) again shows sim- ilar distributions (Part I, Table III). It is probable, therefore that the inclusion of industrial accidents in the data of Part II does not greatly affect the distribution of cases as compared with the distribution in Part I (Part I, Table VI; Part II, Table III). The distribution of 10,000 cases of sickness and non-industrial acci- dent by duration among males and among females in the same associa- tion (Xo. 8) shows that a larger proportion of the cases among the males are of shorter duration than among females (Part I, Table IV). For example, out of 10,000 cases among males 4,098 lasted eight to 14 days; out of 10,000 cases among females only 2,773 cases lasted eight to 14 days. The records of this association also show that the average days of disability per year are greater for women than for men. The average number of days' disability per member per year (based upon the cases lasting eight da3^s or more inclusive of disability up to 189 days) is much higher in this association than in any other studied. This is due in part to the large number of women members and to the liberal treatment accorded them. The combined data of Part I indicates that in the course of a year 19.7 per cent of the members of the nine principal associations are dis- abled bv sickness and non-industrial accident for eight days or more (Part I, Table VII). The data for the Workmen's Sick and Death —21 H I 322 Benefit Fund show that in the course of a year 16.9 per cent of the members are disabled for eight days or more as a result of sickness, non-industrial and industrial accident (Part II, Table V), and that 23.5 per cent are similarly disabled for one day or more (Part II, Table IV). Data in both Part I and Part II give the average days of disability per case. In the nine principal associations the average duration per 100,000 cases of sickness and non-industrial accidents combined lasting eight days and over, inclusive of disability up to 189 days, is 35.3 per case (Part I, Table YI). In part II the average duration per case (in- clusive of industrial accident) lasting eight days or over, inclusive of disability up to 189 days, is 37.2 days (Part II, Table V). The average number of days disability per member per year (based on cases lasting eight days or more, inclusive of disability up to 189 da3^s) is 6.0 days for the nine principal associations studied in Part I (Part I, Table VI) ; the average days of disability (inclusive of indus- trial accidents) is 6.3 days per member per year for the Workmen's Sick and Death Benefit Fund (Part II, Table VI). Information from the Workmen's Sick and Death Benefit Fund for compensated cases of disability (inclusive of industrial accidents) lasting one day and over, inclusive of disability up to one year, makes it possible to compute more closely the total days of disability per member per year. The relatively small number of cases lasting less than seven days sls compared with those lasting seven days and over indicates that the compensated cases lasting less than seven days are probably below the actual number (See also Part I, Table I, Association Xo. 11), and hence that the estimated average days disability per member per year are below the actual days of disability. Subject to these qualification, the data indicate that each member is compensated on the average for 6.9 days of disability a year and that each member is disabled on the average at least 6.9 days a j^ear. Study of disability by occupation and age is possible from the data of the Workmen's Sick and Death Benefit Fund. Unfortunately, ac- curate comparison of sickness in the various occupations covered is im- possible because of the inclusion of disability due to industrial accidents, a hazard which varies from occupation to occupation. As a result in one occupation a larger proportion of disability days will be due to industrial accident than in another. For example, among the 724 freight handlers, the average days of disability per year (based on cases lasting eight days or more, inclusive of disability up to 189 days) is 9.2 days per person. Undoubtedly among the freight handlers disability due to industrial accidents accounts for a considerable proportion of the days of disability (Part II, Table V). Data showing the days of disability by age groups are much more comparable because the accident hazard does not vary so greatly from age group to age group. With increase in age, the duration of disability per case and per member increases regularly. For example persons 20 to 24 years of age are disabled on an average of 4.2 per year; those between 50 and 54 years of age, 7.3 days a j^ear (Part II, Table VI). The days of disability per member sick eight days and over, exclu- sive of the first seven days and of disability days beyond 189, for which no benefit is paid, are referred to as the average compensated days per 323 member. For the associations studied in Part I, the average compen- sated days per member arrived at are 4.8 (Part, I, Table VI) ; for the Workmen's Sick and Death Benefit Fund, 5.1 days per member (Part 11, Table V). From the data studied it is possible to estimate the number of com- pensated days for which an obligatory system of health insurance, pay- ing benefits for 26 weeks after the first seven days, would be liable. Allowing a margin of 25 per cent, the minimum number of compensated days per member per year, under these conditions, would be 6.0 days. By reason of the rather large amount of material used and also by reason of its careful selection and wide occupational distribution, the results arrived at are believed to be fairly trustworthy. Studies of the kind herein contained are of value not only to members of the com- missions and others Avho are considering the advisability of adopting a health insurance system but also to those in charge of existing systems of insurance. More comprehensive studies of the same kind for sick- ness, for non-industrial accidents and for industrial accidents separately, when based on the ages of the members, sex, occupation, etc., are needed. PAET I. A DETERMINATIOJST OF THE SICKNESS AND NON- IXDUSTRIAL ACCIDENT EATE APPLICABLE TO A STATE SYSTEM OF HEALTH INSURANCE BASED UPON A STUDY OF A SELECTED GROUP OF BENEFIT ASSOCIA- TIONS IN THE UNITED STATES. TABLE I — NUMBER OF CASES OF SICKNESS AND NON-INDUSTRIAL ACCI- DENTS, BY DURATION IN DAYS. ASSOCIATIONS 2, 10 AND 11. Number of cases. Duration in days. No. 2. No. 10. No. 11. 7 4,764 4,359 4,287 4,079 3,584 3,214 2,982 3,019 2,152 2,025 1,691 1,551 1,365 1,182 1,274 939 903 842 689 624 596 643 511 509 461 413 365 393 409 8 15 27 44 55 85 97 110 110 105 87 83 77 58 88 84 72 65 60 46 45 37 49 37 43 44 41 32 22 939 9 733 10 6a3 11 528 12 615 13 371 14 364 15 245 16 295 17 183 18 214 19 117 20 125 21 22 23 \ 468 24 25 26 ' 27 28 I 286 29 30 31 < 32 33 \ 250 34 35. .f Duration in days. Number of cases. No. 2. No. 10. No. 11. 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 308 24 285 26 277 31 . 283 21 233 29 260 35 268 26 185 26 • 206 16 217 25 212 21 204 10 183 15 190 11 168 17 167 19 172 15 129 11 . 139 16 127 8 159 17 110 11 123 8 114 17 96 13 131 9 123 9 124 12 94 10 132 166 74 63 48 37 324 TABLE I — Continued. Number of cases. Duration in days. No. 2. No. 10. No. 11. 65 79 117 85 74 64 89 78 63 77 58 55 62 71 60 52 64 58 58 58 52 48 66 51 44 59 51 51 67 40 42 34 49 36 48 51 40 34 35 32 36 45 28 28 30 27 27 40 27 20 27 36 27 25 29 26 38 24 32 26 14 21 19 17 20 16 24 24 10 13 21 17 20 6 5 12 11 10 5 2 6 12 5 4 8 4 3 6 9 6 7 5 5 10 2 7 3 4 5 1 7 1 1 2 5 5 8 3 3 4 6 1 5 3 2 8 4 2 2 4 1 2 4 4 4 37 66 1 67 68 I 19 69 70 71 ' 72 73 38 74 75 76 ■ 77 78 I 30 79 80 81 ' 82 83 I 10 84 85 86 ■ 87 88 i 11 90 91 ' 92 10 94 96 ' 97 98 i 11 100 101 *97 102 104 105 106 108 110 Ill 112 113 114 116 117 118 3 1 1 1 119 120 122 2 1 1 3 124 125 126 128 130 4 4 131 132 1 1 2 1 134 136 Number of cases. Duration in days 137 20 12 12 10 14 13 13 10 13 16 16 13 13 10 8 12 10 9 8 11 8 19 15 11 8 9 8 8 9 13 5 13 6 9 7 8 6 11 8 6 4 8 7 3 10 10 11 5 9 9 4 6 16 5 5 5 8 7 6 8 10 5 5 4 4 10 4 6 5 2 6 5 1 138 139 3 2 1 1 140 141 142 143 144 145 1 1 3 146 147 148 149 1 2 2 1 2 1 2 2 150 151 152 153 154 155 156 157 158 1 1 1 1 1 159 160 161 162 163 164 1 165 166 167 1 168 169 1 1 170 171 172 173 1 174 175 3 176 177 1 178 179 180 1 181 182 2 183 184 185 186 187 1 188 189 1 190 191 2 1 1 1 192 193 194 195 196 197 198 199 2 200 201 2 2 202 203 204 205 206 2 207 208 1 325 TABLE I — Continued. Number of cases. Duration in days. No. 2. No. 10. No. 11. 209 5 5 6 1 6 6 3 5 8 2 9 4 6 3 5 6 4 3 7 6 3 3 3 7 4 6 3 4 2 4 3 3 2 3 5 2 4 4 3 4 1 5 4 3 3 2 3 3 3 2 4 4 2 2 3 1 4 2 3 2 4 4 5 5 7 2 3 6 1 3 2 6 2 210 211 212 213 214 2 1 2 215 216 217 218 1 219 220 1 1 1 221 222 223 224 225 1 226 227 1 228 229 1 231 232 " ■ ■ 233 234 -1 1 235 236 237 238 239 2 240 241 243 : 244 245 1 1 1 246 247 248 249 1 250 251 252 2 253 254 255 1 256 257 258 259 1 261 262 263 264 265 1 1 267 268 269 1 1 1 270 271 272 273 1 1 274 275 276 : 277 278 1 279 Duration in days. Number of cases. No. 2. No. 10. No. 11. 281 2 2 4 3 1 3 2 2 5 4 3 9 2 4 2 1 3 6 2 3 2 5 2 282 283 1 284 285 286 287 288 289 290 291 1 2 292 293 294 295 296 297 298 299 300 I 301 302 303 304 305 4 2 2 4 3 2 3 4 7 5 4 1 3 2 5 4 2 4 4 3 1 4 2 4 1 3 5 5 4 2 6 3 2 1 3 4 4 1 1 4 4 4 3 6 4 5 7 10 306 1 307 308 309 1 310 311 312 313 . .. 314 1 315 316 317 318 319 320 1 1 321 322 323 324 325 326 1 327 328 329 . . 330 331 332 . . 333 334 335 336 337 338 1 1 339 340 341 . . .. 342 343 1 344 345 346 347 1 348 349 . .. 350 351 . 352 326 TABLE I — Concluded. Number of cases. Duration in days. No. 2. No. 10. No. 11. 353 2 4 5 5 3 8 354 : 1 355 356 357 358 359 Number of cases. Duration in days. No. 2. No. 10. No. 11. 360 6 4 7 2 9 694 361 362 363 364 365 76 ♦ This number includes cases lasting 100 days or more. The distribution of compensated cases under Xo. 2 and Xo. 10 illus- trate two t}^es that occur among the establishment funds studied. In Xo. 2 the number of cases decreases in a fairly uniform manner as the number of days duration increases. In Xo. 10 the number of cases first increases as the number of davs duration increases from 7 to 14, and then decreases. The distributions in Xo. 11 include all cases of sick- ness and non-indrretrial accidents (compensated and non-compensated) for a large manufacturing concern in Ohio that is unusually well organ- ized for collecting accurate data. It will be noticed that Xo. 2 and Xo. 11 agree in type. The distributions in Table I illustrate the form in which the data used in this report were tabulated. In the rest of Part I only compensated cases of sickness and non- industrial accidents are used. 327 TABLE it— DISTRIBUTION OF 10,000 CASES EACH OP SICKNESS, OP NOl^- INDUSTRIAL ACCIDENTS, AND OP SICKNESS AND NON-INDUSTRIAL ACCIDENTS, BY DURATION IN DAYS. ASSOCIATIONS NO. 6 AND 4. Case distribution per 10,000 cases. Number 6. Number 4. Duration in days. Sickness (based on 4,975 cases). Non-in- dustrial accidents (based on 1,622 cases). Sickness and non- industrial accidents (based on 6,597 cases). Sickness (based on 7,682 cases). Non-in- dustrial accidents (based on 826 cases). Sickness and non- industrial accidents (based on 8,508 cases). 8- 14 2,324 2,072 1,322 856 689 442 376 281 235 193 161 175 129 129 92 74 88 33 56 35 48 23 22 18 16 108 3,083 1,954 1,202 968 771 419 308 259 197 80 173 117 55 62 38 43 18 43 32 31 7 18 18 6 62 18 2,510 2,043 1,293 890 709 437 359 276 226 165 164 161 111 112 79 67 71 35 50 33 38 21 21 15 27 87 4,223 1,838 914 612 444 310 212 144 113 108 195 76 61 49 42 34 26 26 26 20 20 20 18 17 17 435 4,770 1,731 1,017 654 448 339 242 85 133 73 97 73 48 24 24 24 12 12 12 12 12 1 12 12 12 121 4,276 15- 21 1,828 22- 28 924 29-35 616 36-42 445 43-49 313 50-56 215 57-63 139 64- 70 115 71- 77 105 78- 84 185 85- 91 75 92- 98 60 99-105 47 10&-112 40 113-119 33 120-126 25 127-133 25 134-140 24 141-147 19 148-154 18 155-161 19 162-168 18 169-175 16 176-182 16 183-189 404 Total 10,000 10,000 10,000 10,000 10,000 10,000 328 TABLE III— DISTRIBUTION OF 10,000 CASES EACH OF INDUSTRIAL ACCt- DENTS AND OP SICKNESS AND NON-INDUSTRIAL ACCIDENTS, BY DURATION IN DAYS. ASSOCIATION NO. 1. Case distribution 10,000 cases. per Duration in days. Industrial accidents (based on 13,308 cases). Sickness and non-indus- trial accidents (based on 37,615 cases). 8-14 4,997 1,911 892 579 356 293 186 132 94 69 59 54 29 40 33 22 23 23 21 16 15 16 10 9 8 6 107 5,573 1,830 15-21 22-28 770 29-36 415 37-42 290 43-49 203 50-56 156 57-63 120 64-70 86 71-77 72 78-84 55 85-91 54 92-98 33 99-105 40 106-112 37 11.^119 21 120-126 22 127-133 15 134-140 12 141-147 13 148-154 10 155-161 9 162-168 12 169-175 ... . .. . 6 176-182 7 183-189 7 190- 132 Total : 10,000 10,000 329 TABLE IV^DISTRIBUTION OF 10.000 CASES OF SICKNESS AND NON- INDUSTRIAL ACCIDENTS FOR MALES. FOR FEMALES AND FOR MALES AND FEMALES. BY DURATION IN DAYS. ASSOCIATION NO. 8. Case distribution per 10,000 oases. Duration in days, • Males (based on 815 cases). Females (based on 1,006 cases). Males and females (based on 1,821 cases). 8-14 4,098 1,988 908 564 368 245 221 243 209 147 86 86 49 74 37 25 74 37 25 61 12 25 25 25 37 37 294 2,773 1,849 1,113 626 487 457 378 199 209 139 139 159 139 89 159 50 60 60 88 50 30 40 60 40 20 30 557 3,366 15-21 1,911 22-28 1,021 29-36 599 37-42 434 43-49 362 50-56 308 57-63 217 64-70 209 71-77 143 78-84 115 85-91 126 92- 98 99 99-105 82 106-112 104 113-119 .38 120-126 ; 66 127-133 49 134-140 60 141-147 55 148-154 25 155-161 33 162-168 44 169-175 33 29 183-189 33 439 10,000 10,000 10,000 # 330 'tABLE V— DISTRIBUTION OP 10,000 CASES OF SICKNESS AND NO^- INDUSTRIAL ACCIDENTS, BY DURATION IN DAYS AND BY ASSOCIA- TIONS. TWELVE BENEFIT ASSOCIATIONS. Case distribution per 10,000 cases. No. 1. No. 2. No. 3. No. 4. No. 5. No. 6. No. 7.* No. 8. No. 9. No. 10. Duration in days. CO OS OS ■^ ■ 00^ g-og ® JS o IS 5? c S3 OS en 2 C8 «? 00 00 a 6 CO 1 CO u-^ S"S - 003 cO~ CS 53 05 Oi g^ 1—4 00 1—1 g^ %^ CO cS 03 Oi CO^ «i tn 52 03 03 8-14 5,573 1,830 770 415 290 203 156 120 86 72 55 54 33 40 37 21 22 15 12 13 10 9 12 6 7 7 132 4,612 2,031 946 553 346 252 192 148 109 84 73 67 57 49 37 34 31 22 20 17 15 14 12 10 9 11 249 4,474 1,690 893 683 326 336 273 210 95 116 106 88 66 62 55 46 35 31 22 28 20 19 18 17 16 15 260 4,276 1,828 924 616 445 313 215 139 115 105 185 75 60 47 40 33 71 25 24 19 18 19 18 16 16 14 390 3,472 1,714 1,176 791 602 394 337 240 205 164 135 127 100 60 45 34 66 25 22 20 17 16 15 13 13 12 221 2,510 2,043 1,293 890 709 437 359 276 226 .165 164 161 111 112 79 67 71 35 50 33 38 21 21 15 27 20 67 2,383 1,937 1,491 783 533 609 468 185 294 174 98 141 98 65 44 44 33 44 11 22 53 33 11 22 11 413 3,366 1,911 1,021 599 434 362 308 217 209 143 115 126 99 82 104 38 66 49 60 55 25 33 44 33 29 33 439 2,384 2,272 1,289 785 448 433 357 280 188 173 137 132 87 102 66 61 51 46 46 66 31 41 36 15 31 51 392 1,610 15- 21 2,260 22-28 1,520 2^ 35 996 36- 42 714 43-49 461 50- 56 383 67-63 294 64- 70 219 71- 77 153 78-84 152 8^ 91 119 92-98 108 99-105 93 106-112 86 113-119 67 120-126 34 127-133 33 134-140 37 141-147 26 148-154 33 155-161 30 162-168 11. 169-175 22 176-182 15 183-189 8 190- 516 Total 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 I • Distribution No. 7 is the combination of the distributions given by three rela- tively small associations, each of which is organized and administered in such, a way as to give trustworthy results. Further information concerning nine of these benefit associations is given in Table VII. For the purpose of obtaining from the combined experience of these 12 associations, figures representative of sickness among the industrial population, it was decided not to weight in proportion to the members exposed because this would have given undue weight to the sickness experience in certain occupations heavily represented in the associations studied but not of equal numerical importance in the industrial popula- iton. In combining them, the experience of each association was given equal value. This leads to the first part of Table VI. ^31 'TABLE VI— DISTRIBUTION OF 100,000 CASES OF SICKNESS AND NON- INDUSTRIAL ACCIDENTS, BY DURATION IN DAYS. COMBINED EXPE- RIENCE OF TWELVE BENEFIT ASSOCIATIONS. All cases. Duration in days. Case distribution per 100,000 cases (based on 132,840 cases). Number of days of disability per 100,000 cases. Accumu- lated days of disability per 100,000 cases. 8-14 34,660 19,516 11,323 7,111 4,847 3,800 3,048 2,109 1,746 1,349 1,220 1,090 819 712 593 445 398 325 304 299 260 235 187 158 185 182 3,079 381,260 351,288 283,075 227,552 189,033 174,800 161,544 126,540 116,982 99,826 98,820 95,920 77,805 72,624 64,637 51,620 48,954 42,2.50 41,648 43,056 39,260 .37,130 30,855 27, 176 33, 115 33,852 581,931 381,260 15-21 732,548 1,015,623 1.243,175 22-28 29-35 36-42 1,432,208 1,607,008 43-49 50-56 1, 768, 552 57-63 1,895,092 64-70 2,012,074 71-77 2,111,900 78-84 2,210,720 2,306,640 85-91 ' 92-98 2,384,445 99-105 2,457,069 106-112 2,521,706 113-119 2,573,326 120-126 2,622,280 127-133 2,664,530 134-140 2,706,178 141-147 2,749,234 148-154 2,788,494 155-161 2,825,624 162-168 2,856,479 169-175 2,883,655 176-182 2,916,770 183-189 2,950,622 190- 3,532,553 Total 100,000 3, 532, 553 332 TABLE VI — Concluded. I Duration in days. Cases lasting 190 days and over. Case distribu- tion per 100,000 cases. Number of days of disability per 100,000 cases. Accumu- lated days of disability per 100,000 cases. 190-196.. 197-203.. 204-210. . 211-217.. 218-224.. 225-231.. 232-238.. 239-245. . 246-252. . 253-259.. 260-266. . 267-273.. 274-280.. 281-287.. 28^294.. 295-301.. 302-308.. 309-315.. 316-322. . 323-329... 330-336... 337-343... 344-350... 351-357... 358-363... 364-371... 372- . . . Total 127 24,511 114 22,800 102 21,114 98 20,972 91 20,111 82 18,696 78 18,330 73 17,666 77 19, 173 69 17,664 64 16,832 77 20, 790 . 64 17,728 59 16,756 57 16,587 61 18, 178 59 17,995 62 19,344 55 17, 545 55 17,930 57 18,981 50 17,000 48- 16,656 53 18,762 55 19,855 64 23,552 1,228 455, 588 3,079 951,116 2, 975, 133 2,997,933 3,019,047 3,040,019 3,060,130 3,078,826 3,097,156 3,114,822 3,133,995 3,151,659 3, 168, 491 3, 189, 281 3,207,009 3,223,765 3,240,352 3, 258, 530 3, 276, 525 3, 295, 869 3,313,414 3,331,344 3,350,325 3,367,325 3,383,981 3,402,743 3,422,598 3,446,150 3,901,738 The second part of this table distributes the 3,079 cases in the first part, that last longer than 189 days, through the following 26 weeks. The distribution of these cases was based upon the distributions (slightly smoothed) given by six of the ten benefit associations used in forming Table V. The number of days of disability for a given week was determined by finding the product of the number of cases by the average number of days duration for that week (c. g., 381,260==:34,660Xli). It is to be noted that the average duration in days per case as given by the distribution in the first part is about 35.3 while thai: given by the distribution in both parts is slightly greater than 39. 333 TABLE VII — AVERAGE DURATION OF DISABILITY IN DAYS PER CASE AND IN DAYS PER MEMBER. NINE BENEFIT ASSOCIATIONS. (The figures are based on cases lasting 8 days or more ; the cases lasting more than 189 days are counted as 189 day cases.) Benefit associations. Years covered. Number of cases. Number of members. Number of days of dis- ability. Average compen- sated days per member. Average days of disability. Per case. Per member. Number 1 . Number 2 . Number 3 . Number 4. Number 5. Number 6 . Number 8. Number 9. Number 10. Total... 1913-1917 37,615 *115,648 873,818 5.3 23.2 1913-1917 t55,343 276, 119 1,574,982 4.3 28.5 1915-1917 952 6,187 29, 481 3.7 31.0 1915-1917 8,508 70,697 280,411 3.1 33.0 1916-1917 tl6,432 100,000 557,065 4.4 33.9 1915-1917 6,597 47,605 241,521 4.1 36.6 1916-1917 1,821 6,946 73,872 8.8 40.6 1914-1916 1,963 13,019 82,363 5.3 41.9 1912-1916 2,690 26,942 117,023 3.6 43.5 131,921 663,163 3,830,536 4.4 29.0 7.6 5.7 4.8 3.9 5.6 5.1 10.6 6.3 4.4 5.8 * Membership is determined on the basis of cards actually handled. t Cases of disability do not include non-industrial accident. The number of days of disability was determined from distributions illustrated by those given in Table I. Information concerning the membership, the organization and other conditions pertaining to these associations, along with the distributions illustrated by Table I, leads one to conclude that one (at least) of the sickness rates in the last column is abnormally high, Avhile some others are abnormally low. The high rate for No. 8 is due to the fact that this association contains a large percentage of females in its membership and the organization has been liberal in its treatment of them. One sickness rate is too low on account of the fact that the percentage of cases of short duration is altogether too small. Another is too low because some of the members take their vacation during illness: they are given better pay during the vacation period allowed than they would get by claiming sickness benefits from the association. These three cases just cited are illustrations of the fact that full information of all conditions that pertain to a given organization is needed before a fairly accurate estimate can be formed of the value of its sickness rate. The study of the Ohio establishment funds which the writer of this chapter of the report made last spring and summer leads him to conclude that what may be termed the administrative part of these benefit asso- ciations is an important factor and needs careful consideration. Under administrative part it is meant to include not merely the attitude of the officers in enforcing the regulations of the association but also the atti- tude of the members in applying for benefits. If the above sickness rates are given equal weight in combining them, a sickness rate of 6.0 days results for the period stated. If these sickness rates are given weights equal to the number of members in- volved in each determination, a sickness rate of 5.8 days results. If Association No. 1, the data for which are incomplete, is omitted, the corresponding numbers are 5.8 and 5.4 respectively. But, as it has 334 m stated above, the unweighted average gives what is believed to be a more representative experience. The average number of compensated days per member can be easily ascertained from the average number of days disability per member. The total number of days of disability per 100,000 cases, 3,523,553, is divided by 6 days to ascertain the number of members. The number of members thus ascertained is 588,759. If the waiting period of seven days of disability for each of the 100,000 cases is subtracted from the total days of disabilit}^ 3,532,553, the re- mainder is 2,832,553, or the number of days for which benefit is paid. The total compensated days divided by the number of members gives the average compensated days per member, or 4.8 days. In the judgment of the writer^ considering all facts in hand, the following conclusion may be drawn : the study made in this part shows that the average number of days each member of the organizations investigated was disabled each year through sickness and non-industrial accident was about six days for cases of such disability lasting eight days or more — cases lasting more than 189 days being counted as 189 day cases. The problem of adjusting the result obtained through the study of these selected benefit associations to a state health insurance system must now be considered. The condition that would obtain in a state health insurance system would differ, very probably, from those that obtain in the associations considered. Some of the important differences that would likely occur may be stated as follows : I. A less favorably selected body of risks for any given age; II. A larger percentage of risks of advanced age; III. A larger percentage of female members; IV. A tendency to administer the funds in a more liberal manner. All of these would have the effect of increasing the sickness rate. Just what change in this rate would be produced by each of the stated differences and by any others that might be stated, it is impossible to determine with accuracy. Further, it is highly probable that competent dctuaries would differ in their estimates of the total effect. It is our judgment that a 25 per cent increase should be allowed to make the sickness rate arrived at in the study of benefit associations applicable to a state health insurance system. One actuary who has been consulted and who has devoted considerable attention to problems of this char- acter, holds the view that the increase should be at least 25 per cent to provide a proper safety factor. Applying a 25 per cent increase 7.5 days is obtained as the min- imum estimate of the sickness rate, for the occupations studied in Part I, applicable to a state system of health insurance paying benefits for a period not to exceed twenty-six weeks after a waiting period of one week. A 25 per cent increase in the number of compensated days yields 6.0 days as the minimum number which would be compensated in an obligatory system paying benefits for twenty-six weeks after the expir- ation of the first seven days of disability. 335 PART II. A STUDY OF THE DISABILITY DATA FROM THE WORKMEX^S SICK AND DEATH BENEFIT FUND FOR THE YEARS 1912-1916. TABLE I — NUMBER OF CASES OF DISABILITY, BY DURATION IN DAYS AND BY OCCUPATION. WORKMEN'S SICK AND DEATH BENEFIT FUND, 1912-1916. Number of cases. Duration in days. Barbers. Bar- tenders. Brick- layers and masons. Car- penters. Painters. Plast- erers. Plumb- ers and steam- fitters. Sheet metal workers. 1 4 10 18 12 8 5 21 9 11 8 3 2 6 5 3 2 5 3 1 2 2 1 3 3 6 13 12 8 7 3 4 5 2 2 1 1 4 1 2 1 1 1 7 4 9 11 19 12 11 31 12 14 9 10 15 6 16 10 2 8 8 8 2 12 4 2 11 4 6 1 24 28 11 16 7 4 3 8 4 8 2 3 5 1 2 1 6 5 2 1 1 6 3 15 10 20 25 23 35 13 27 19 16 21 7 22 9 14 11 10 10 4 19 6 9 9 10 3 8 27 23 14 18 16 11 6 2 3 2 3 3 2 2 1 2 7 3 6 2 2 6 13 54 81 118 122 90 25 94 111 73 85 71 53 137 61 49 52 50 43 34 85 31 36 40 22 28 23 163 139 97 89 63 54 39 30 21 14 28 16 16 7 8 5 41 27 20 14 8 13 7 14 42 38 42 25 86 28 32 25 21 29 13 36 18 24 16 11 14 6 24 12 9 14 15 12 11 55 50 38 15 24 16 13 7 13 6 3 5 4 4 2 2 15 14 3 7 2 4 2 3 3 9 6 5 10 3 3 4 3 8 2 3 \ 2 2 2 1 8 5 2 2 4 1 1 2 1 1 1 2 2 1 1 1 3 5 24 20 22 16 32 9 18 12 9 8 6 11 3 7 7 6 5 7 4 3 5 1 2 3 2 13 15 8 5 7 6 3 2 1 1 4 1 1 2 1 1 2 2 1 5 2 16 3 19 4 23 5 21 6 23 7 45 8 22 9 19 10 20 11 20 12 20 13 12 14 18 15 10 16 4 17 10 18 11 19 7 20 4 21 13 22 8 23 5 24 3 25 3 26 8 27 7 28-34 25 35-41 19 42-48 19 49- 55 11 56-62 7 63-69 10 70-76 6 77-83 3 84-90 5 91- 97 6 98-104 4 105-111 112-118 2 119-125 126-132 3 133-139 3 6 175-209 5 210-244 1 245-279 1 280-314 1 315-364 1 Number of cases Number of mem- bers 228 1,242 404 2,290 539 2,241 2,748 11,586 926 4,389 109 558 326 1,448 514 2,343 336 TABLE I — Continued. Number of cases. Duration in days. Other building construc- tion. Cooks and waiters. Engineers and firemen. Farmers, garden- ers and florists. Freight handlers. Laborers. Auto- mobile, etc., manu- factur- ing. Clay products. 1 1 5 5 5 5 5 16 4 6 3 2 7 4 4 1 2 1 2 3 2 1 2 5 5 4 2 3 2 3 1 1 1 2 2 2 1 1 1 6 13 12 18 20 16 42 15 20 12 17 15 13 20 11 7 7 13 5 7 10 6 7 4 3 9 4 29 15 14 13 15 9 11 6 4 3 1 4 2 4 2 1 4 6 2 1 6 4 10 32 30 42 29 76 31 28 21 24 25 19 34 15 9 16 18 13 8 14 8 12 6 10 11 8 34 36 17 21 15 9 9 10 8 5 9 4 5 5 1 4 8 4 1 4 2 2 2 3 7 7 13 7 30 7 11 16 7 4 6 6 4 7 9 6 3 3 8 2 3 5 4 2 17 11 4 4 1 4 4 1 1 2 2 1 2 1 1 1 1 1 1 1 1 5 3 4 4 4 14 4 4 7 6 5 9 17 5 4 3 3 4 2 8 3 4 2 2 1 13 8 10 9 4 3 1 2 1 1 4 2 1 2 5 1 3 1 33 103 173 238 274 196 433 171 200 154 142 165 124 220 98 92 92 83 90 73 128 49 69 51 42 42 51 287 218 133 112 69 91 46 32 25 2.7 23 36 19 10 14 15 46 32 15 11 5 14 1 4 8 8 14 5 13 4 7 8 8 2 4 9 7 9 4 2 4 2 1 3 2 8 7 9 6 2 1 4 1 2 3 1 1 2 3 1 2 5 3 4 4 4 5 3 6 7 7 17 8 9 4 1 10 g 11 2 12 5 13 4 14 9 15 4 16 2 17 2 18 2 19 1 20 3 21 2 22 2 23 2 24 2 25 2 26 2 27 1 28-34 12 35-41 6 42- 48 3 49- 55 2 56-62 3 63-69 1 70-76 4 77-83 3 84-90 91- 97 3 98-104 105-111 112-118 1 119-125 126-132 1 133-139 2 140-174 1 175-209 210-244 245-279 1 280-314 315-364 1 Number of cases •Number of mem- bers 122 588 484 2,339 766 3,378 243 1,203 199 724 4,866 17,700 180 735 144 652 337 TABLE I — Continued. Duration in days. Number of cases. Clothing manufac- turing. Dyers. Elec- trical workers. Food. Slaugh- tering and meat packing. Glass workers. Jewelers. Tanners. 1 2 3 4 5 6 7 8 9 10 11 !. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28-34 35- 41 42-48 49-55 56-62 63-69 70-76 77-83 84- 90 91-97 98-104 105-111 112-118 119-125 126-132 133-139 140-174 175-209 210-244 245-279 280-314 315-364 Number of cases Number of mem bers 6 29 33 34 44 27 89 36 28 32 22 18 15 40 13 13 16 14 20 9 29 11 15 11 7 7 6 50 40 30 21 16 13 10 13 11 6 5 3 3 7 1 6 7 4 3 3 3 4 883 4,847 1 5 11 7 5 20 11 4 3 5 4 2 6. 1 1 3 1 2 4 2 3 2 1 4 1 14 5 5 5 4 3 3 2 1 2 2 2 2 2 1 1 1 164 748 2 7 9 11 13 4 24 8 16 9 3 12 4 8 6 2 4 4 1 3 2 4 3 1 3 10 9 6 5 4 2 3 4 3 1 4 1 215 988 10 28 52 51 78 63 143 54 46 52 40 44 24 80 35 30 25 27 23 23 40 18 22 21 20 22 16 96 54 58 37 37 22 12 18 14 12 16 5 9 5 2 11 19 12 4 10 5 5 1,540 7,507 7 28 52 58 63 40 111 38 47 45 40 32 38 66 31 23 23 35 27 16 31 14 18 12 7 12 19 99 55 43 43 31 25 21 8 10 6 10 6 10 3 4 3 10 12 4 5 4 6 1,351 5,724 1 1 5 10 8 8 17 11 15 16 9 9 16 12 7 17 19 19 40 9 3 9 10 3 15 13 4 5 11 5 15 3 4 13 5 2 14 8 6 17 3 2 4 4 2 8 3 2 9 2 5 5 4 2 5 4 3 4 6 4 8 1 1 5 3 5 4 5 3 4 3 6 1 1 1 2 1 6 6 5 16 16 12 13 5 6 12 6 3 5 9 1 3 3 3 6 4 4 1 2 1 2 3 1 2 2 1 3 2 1 3 1 2 1 3 1 2 5 8 4 4 3 1 1 1 2 2 22 166 370 55 1,169 1,466 —22 H 1 338 TABLE I — Continued. Ntunber of cases. - Duration in days. 1 Leather workers. Liquor manu- facturing. Black- smiths. Machin- ists. Holders. Other metal workers. Printers. Stone cutters. 1 6 27 39 47 51 35 89 26 38 31 25 22 15 35 20 20 15 16 6 13 26 12 13 10 10 12 6 45 36 36 28 21 16 9 10 5 8 4 1 5 5 3 1 13 10 5 6 3 7 21 102 129 157 165 144 381 140 159 113 115 113 93 186 82 92 69 63 66 53 113 47 42 45 60 47 42 262 181 147 100 78 60 40 58 22 26 28 17 17 18 14 7 43 30 21 9 7 14 3 9 13 26 14 16 41 20 16 16 15 21 20 22 10 6 5 9 16 11 11 9 8 7 9 5 4 25 21 27 19 11 6 6 4 2 4 4 2 2 2 5 4 2 5 2 3 23 121 170 176 182 117 321 162 137 103 94 112 78 163 67 61 77 56 62 38 79 35 33 24 48 35 32 204 141 104 72 62 49 38 35 40 18 14 25 15 15 9 12 40 22 11 14 7 14 5 17 21 27 47 34 77 30 20 23 21 21 15 34 13 13 17 14 15 5 27 14 7 8 11 9 6 52 30 20 21 16 6 8 2 1 •? 5 2 2 1 1 5 4 1 9 39 66 75 99 63 142 57 47 62 50 56 37 72 31 36 41 23 24 21 33 19 17 20 20 17 14 100 60 48 31 29 30 17 9 22 14 10 6 6 3 3 2 12 2 7 3 1 1 6 16 26 35 31 19 47 18 15 11 20 23 7 24 11 7 13 8 7 6 12 6 ■ 8 6 5 i 37 19 20 16 10 12 11 5 4 3 7 1 4 2 5 6 9 9 4 7 3 4 2 3 7 9 4 6 5 16 6 6 7 26 8 14 9 13 10 11 11 9 12 6 13 2 14 19 15 2 16 8 17 5 18 3 19 4 20 3 21 6 22 3 23 2 24 7 25 26 2 27 3 28- 34 12 35-41 19 2 49- 55 5 56- 62 3 63- 69 5 70- 76 6 77-83 2 84-90 2 91-97 2 98-104 3 105-111 1 112-118 2 119-125 n 126-132 133-139 140-174 175-209 210-244 245-279 2 280-314 1 315-364 3 Number of Number of mem- bers 941 4,316 4,038 14,324 518 2,053 3,564 16,023 737 2,838 1,606 6,907 591 3,401 273 1 172 339 TABLE I — Concluded. Duration in days. NTimber of cases. Tex- tile manu- factur- ing. To- bacco. Other manu- factur- ing em- ployees. Miners. Profes- sional. Trade and clerical. Driv- ers. Rail- road em- ployees. Wood work- ers. All other occu- pations. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27.. 28- 34 25-41 42-48 49- 55 56- 62 63-69 70- 76 77- 83 84-90 91-97 98-104 105-111 112-118 119-125 126-132 133-139 140-174 175-209 210-244 245-279 280-314 315-364 Number of cases Number of mem bers 7 30 59 69 76 44 132 39 40 34 38 56 32 62 28 29 21 20 20 19 40 17 12 12 8 17 14 77 53 39 28 31 18 16 12 10 12 12 4 6 8 2 6 14 5 7 3 2 3 1,343 7,287 30 48 59 43 58 33 328 93 90 66 65 55 53 143 49 47 40 38 29 ■ 24 71 22 18 23 23 25 18 118 111 75 57 59 34 37 23 22 16 18 8 14 10 10 6 25 12 19 10 9 17 2,301 8,897 4 5 1 27 23 3 39 41 7 38 74 6 57 91 7 26 80 2 85 164 17 31 89 10 23 81 8 37 87 9 22 57 6 32 90 6 16 59 2 27 119 6 17 41 1 15 52 1 20 50 5 12 42 1 18 47 1 11 28 34 68 6 6 27 8 29 2 11 23 2 5 23 1 6 24 4 19 1 47 164 6 28 111 7 36 67 4 25 59 3 19 35 1 14 36 2 12 24 1 11 25 1 8 20 2 6 18 1 6 11 7 14 1 3 12 1 1 11 1 5 8 3 8 6 17 2 4 24 1 1 8 1 7 3 2 5 1 12 31 .62 47 51 23 87 48 38 29 28 28 20 31 21 18 11 15 11 8 23 7 5 12 9 14 5 56 39 27 19 12 17 5 12 6 3 8 6 6 5 4 3 10 7 3 5 4 4 876 4,164 2,220 7,068 146 1,192 956 5.591 5 5 33 7 24 57 8 61 76 14 41 97 10 68 76 5 47 156 11 111 71 8 43 59 3 43 55 6 41 61 5 38 49 6 42 46 4 27 107 9 54 44 4 22 34 5 30 33 4 27 39 2 28 40 3 26 29 19 45 3 38 27 2 19 22 2 15 19 1 18 17 3 11 22 2 13 29 1 11 132 6 80 106 4 57 67 8 37 53 4 41 41 4 29 35 17 22 3 16 20 7 16 27 1 13 16 2 10 9 7 15 2 5 8 7 5 5 5 5 4 6 22 3 24 16 11 11 1 8 4 9 5 3 7 6 1 4 1,977 177 1,336 6,890 691 6,093 13 66 85 107 97 90 179 86 64 72 60 61 50 88 43 45 29 33 36 35 51 27 28 15 20 26 16 125 86 60 43 41 34 23 23 15 10 14 9 5 8 7 6 24 20 10 12 8 4 2,109 9,258 340 TABLE II — ^NUMBER OF CASES OF DISABILITY, BY DURATION IN DAYS AND BY AGE. WORKMEN'S SICK AND DEATH BENEFIT FUND, 1912- 1916. Duration in days. 20 25 30 35 40 45 50 55 60 65 70 75 80 1.... 2.... 3.... 4 5.... 6 7.... 8-... 9.... 10.... 11 12.... 13.... 14 15 16 17.... 18.... 19 20 21 22.... 23 24 25 26 27 28- 34. 35- 41. 42- 48. 49- 55. 56- 62. 63- 69. 70- 76. 77- 83. 84- 90. 91- 97. 98-104. 105-111. 112-118. 119-125. 126-132. 133-139. 140-174. 175-209. 210-244. 245-279. 280-314- 315-364. Number of cases Number of mem- bers 4 5 6 14 16 8 22 11 13 10 12 8 2 8 9 4 3 3 4 7 3 4 4 2 2 1 15 8 6 3 2 1 2 1 1 224 786 5 21 29 35 41 15 71 20 27 16 15 16 10 19 9 11 6 6 91 10 14 6 8 4 4 10 2 25 18 12 10 6 6 5 4 3 3 2 3 1 1 2 1 1 1 543 5 36 46 50 57 51 106 49 44 25 27 22 12 47 16 13 16 17 15 8 23 12 5 13 5 7 6 35 29 21 15 13 6 7 7 6 5 3 2 4 3 2 15 4 1 1 2 2 916 2,367 3,978 8 33 51 59 66 37 105 65 31 30 46 41 16 53 19 29 18 17 17 8 29 11 7 10 10 15 12 64 42 27 21 13 11 8 11 10 6 6 9 3 2 2 5 4 4 3 2 5 1,101 5,043 8 44 57 74 73 38 138 47 43 50 36 53 30 59 31 24 23 19 23 16 29 17 10 11 15 17 16 85 39 49 30 32 21 18 10 9 7 2 9 7 5 4 5 9 8 4 3 5 5 1,367 6,144 6 29 47 59 59 48 149 53 43 43 37 45 34 73 31 29 31 27 20 29 28 12 21 10 15 18 20 79 68 39 42 23 26 14 13 16 5 9 15 5 3 3 4 14 5 5 5 3 2 1,414 6,404 4 22 34 54 55 46 114 35 44 38 40 41 40 64 34 24 23 24 14 25 36 12 23 19 16 15 11 86 64 48 42 21 27 14 16 11 9 5 7 9 6 4 3 19 13 6 5 5 3 1,330 5,789 4 12 21 26 31 34 89 30 36 33 18 25 27 50 24 16 13 16 18 18 32 9 5 15 18 9 10 64 51 44 30 32 27 13 18 12 4 9 3 10 6 3 4 18 19 5 3 4 8 1,026 1 3 9 14 8 11 42 22 10 15 14 15 9 13 5 6 8 13 9 4 17 4 9 5 4 4 6 35 25 24 13 12 13 9 5 4 6 7 6 6 4 1 1 13 7 5 4 2 7 489 4,200 1,982 I 1 1 6 4 5 3 13 6 1 3 2 4 8 7 1 3 2 3 1 2 6 3 2 1 1 1 1 13 14 11 6 6 7 2 1 4 2 4 2 2 1 2 3 2 1 1 177 661 1 1 1 2 2 1 2 1 1 1 1 3 1 1 1 1 21 70 1 1 1 1 1 5 18 1 1 341 TABLE II — Concluded. Duration in days. Un- der 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 VO- Vb- 20. 79 AU ages. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28- 34 35-41 42- 48 49-55 56-62 , 63- 69 70-76 77-83 84- 90 91- 97 98-104 105-111 112-118 119-125 126-132 133-139 140-174 175-209 210-244 245-247 280-314 315-364 Number of cases... Number of members . . 1 6 9 10 14 11 8 6 3 5 6 8 4 2 1 2 4 1 2 2 9 3 2 2 3 1 1 1 127 406 17 71 110 117 148 54 189 75 82 69 60 57 20 67 39 27 27 27 35 12 33 18 12 12 20 17 11 95 63 44 33 24 17 11 13 9 7 5 3 4 3 3 1 5 4 2 3 3! 35 136 196 212 254 113 391 162 164 115 121 117 57 158 60 73 69 53 41 32 84 33 41 36 32 30 22 163 130 82 72 58 38 23 19 13 12 19 8 6 10 7 4 21 19 12 11 5 5 1,778 3,574 7,168 15,267 51 45 40 169 167 185 281 254 254 266 325 313 312 338 358 197 222 237 516 618 648 213 250 252 200 232 280 152 225 222 148 195 206 157 187 251 81 142 149 224 262 314 85 129 152 74 145 124 106 119 123 82 107 122 86 101 135 43 71 89 121 139 191 61 55 80 44 65 86 50 68 80 42 60 69 47 63 82 27 51 76 245 348 425 167 274 296 125 145 226 90 141 151 55 115 124 53 80 104 39 51 88 29 43 71 25 39 53 20 34 43 17 35 36 15 32 45 9 28 28 15 13 29 11 16 18 8 17 15 38 42 72 24 32 59 12 26 30 13 20 25 6 8 17 11 23 31 4,862 6,197 7,104 21,886 27,496 30,746 30 132 215 257 279 269 649 238 229 227 209 208 174 335 138 165 150 149 110 112 194 93 100 63 81 80 76 448 338 254 195 148 106 83 84 66 47 50 43 27 23 30 18 74 47 34 27 22 24 7,150 31,579 26 75 141 186 206 225 503 169 181 184 157 166 173 313 136 111 112 101 102 102 170 71 75 88 68 68 74 400 279 234 176 136 127 99 73 67 49 49 35 40 29 13 30 90 47 26 23 18 21 6,044 25,484 16 6 3 48 22 2 86 31 9 109 42 6 1 135 33 10 1 128 46 7 3 316 138 35 2 135 62 12 3 141 41 14 114 47 10 2 90 44 10 1 96 61 12 112 48 13 2 218 73 27 4 88 21 9 79 31 8 1 63 36 4 1 66 27 6 2 68 41 8 2 58 19 7 131 57 20 53 17 7 51 26 7 50 16 7 1 59 16 8 44 20 3 41 23 7 267 127 45 3 230 94 33 2 163 78 23 3 135 54 28 4 99 50 22 87 64 19 64 35 13 1 60 29 10 1 54 17 11 5 36 19 12 3 31 29 11 1 35 20 1 40 15 6 21 13 5 19 13 3 21 13 6 1 75 45 13 54 27 6 27 23 6 1 22 21 2 1 11 8 5 22 21 6 1 4,168 1,859 557 53 16,229 6,686 1,843 170 10 49 271 1,014 1,587 1,846 2,089 1,503 4,017 1,580 1,570 1,371 1,247 1,318 971 2,005 862 841 811 745 729 546 1,144 490 508 473 455 456 408 2,576 1,910 1,381 1,081 836 695 508 433 359 283 283 237 203 161 133 134 476 320 197 167 104 168 43,502 185, 167 343 TABLE III— DISTRIBUTION OP 10,000 CASES OF DISABILITY LASTING SEVEN DAYS OR MORE BY DURATION IN DAYS FOR SELECTED AGE GROUPS. Duration in days. Case distribution per 10,000 cases lasting seven days or more. 20-24 25-29 30-34 35-59 40-44 1-6 4,100 4,377 1,856 975 753 500 349 261 190 135 87 103 71 66 40 24 32 24 24 8 40 31 16 24 24 3,600 4,288 1,849 1,058 620 495 312 274 221 145 88 72 49 46 72 30 23 38 27 15 80 72 46 42 19 19 3,558 4,091 1,952 1,093 683 466 349 251 153 148 109 81 70 56 47 42 25 41 31 22 106 67 33 36 17 31 2,788 3,816 1,927 1,034 718 565 299 291 237 165 105 89 80 71 72 66 58 27 33 35 87 66 54 41 17 47 2,426 7- 13 3,512 14-20 1,852 21-27 1,161 28-34 743 35-41 518 42- 48 396 49- 55 264 56-62 217 63- 69 182 70- 76 154 77-83 124 84- 90 93 91-97 75 98-104 63 105-111 79 112-118 49 119-125 51 1 26-1 32 31 133-139 27 140-174 126 103 210-244 52 245-279 44 280-31 4 30 54 10,000 10,000 10,000 10,000 10,000 TABLE III — Concluded, Duration in days. Case distribution per 10,000 cases lasting seven Case distri- days or more. bution per 100,000 cases lasting seven days 45-49 50-54 55-59 60-64 65-69 or more, all ages. 1,981 1,657 1,432 1,072 712 23,613 3,241 2,957 2,754 2,627 2,038 34,309 1,942 1,884 1,755 1,477 1,327 18,581 1,151 1,184 1,177 1,042 1,135 11,179 751 771 732 756 866 7,320 566 538 631 560 635 5,427 426 451 447 465 442 3,924 327 339 370 322 538 3,072 247 262 271 298 423 2,376 178 245 239 381 365 1,975 139 191 176 208 250 1,443 141 141 165 173 193 1,230 111 129 148 101 212 1,020 79 95 99 113 231 804 84 94 85 173 212 804 72 68 96 119 19 673 , 45 77 109 89 115 577 39 56 58 78 97 457 50 25 52 77 58 378 30 58 58 77 115 381 124 174 206 268 250 1,353 79 91 148 161 115 909 56 50 74 137 115 560 45 44 60 125 38 475 37 35 30 48 96 296 40 41 60 125 115 477 10,000 10,000 10,000 10,000 10,000 10,000 1- 6.. 7- 13.. 14- 20.. 21- 27.. 28- 34.. 35- 41 . . 42- 48. . 49- 55. . 56- 62.. 63- 69.. 70- 76. . 77- 83.. 84-90.. 91- 97.. 98-104.., 105-111... 112-118... 119-125... 126-132... 133-139... 140-174... 17.5-209... 210-244... 245-279... 280-314... 315-364... Total 343 TABLE IV— DISTRIBUTION PER 100,000 CASES, OF CASES OP DISABILITY, DAYS OF DISABILITY, AND ACCUMULATED DAYS OF DISABILITY. BY DURATION IN DAYS. juration in days. Number of cases. Case dis- tribution per 100,000 cases. Davs of disaDility per 100,000 cases. Accumu- lated days of disability per 100,000 cases. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18- 19. 20. 21. 22. 23. 24. 25. 26. 27. 28- 34. 35- 41. 42- 48. 49- 55. 56- 62. 63-69. 70-76. 77- 83. 84- 90. 91- 97. 98-104. 105-111. 112-118. 119-125. 126-132. 133-139. 140-174. 175-209. 210-244. 245-279. 280-314. 315-364. Total . 271 1,014 1,587 1,846 2,089 1,503 4,017 1,580 1,570 1,371 1,247 1,318 971 2,005 862 841 811 745 729 546 1,144 490 508 473 455 456 408 2,576 1,910 1,381 1,081 836 695 508 433 359 283 283 237 203 161 133 134 476 320 197 167 104 168 43,502 623 2,330 3,648 4,243 4,802 3,455 9,234 3,632 3,609 3,152 2,867 3,030 2,231 4,609 1,982 1,933 1,864 1,713 1,676 1,255 2,630 1,126 1,168 1,087 1,046 1,047 938 5,922 4,391 3,175 2,485 1,922 1,598 1,168 995 825 651 651 545 467 370 306 308 1,094 736 453 383 239 386 100,000 623 4,660 10,944 16,972 24,010 20,730 64,638 29,056 32,481 31,520 31,537 36,360 36,389 64,526 29,730 30,928 31,688 30,834 31,844 25,100 55,230 24,772 26,864 26,088 26, 150 27,222 25,326 183,582 166,858 142,875 129,220 113,398 105, 468 85,264 79,600 71,775 61, 194 65,751 58,860 53,705 45, 140 39,474 41,888 171,758 141,312 102, ,S.U 100,346 70,983 131,240 2,958,744 623 5,283 16,227 33,199 57,209 77,939 142, 577 171,633 204, 114 235,634 267, 171 303, 531 339, 920 404,446 434, 176 465, 104 496,792 527,626 559,470 584, 570 639,800 664,572 691,436 717,524 743,674 770,896 796,222 979,804 1,146,662 1,289,537 1,418,757 1,532,155 1,637,623 1,722,887 1,802,487 1,874,262 1,935,456 2,001,207 2,060,067 2,113,772 2,158,912 2,198,386 2,240,274 2,412,032 2,5o3,344 2,656,175 2,756,521 2,827,504 2,958,744 344 TABLE V— AVERAGE DURATION OP DISABILITY PER CASE AND PER MEMBER BY OCCUPATION. (These figures are based on cases lasting eight days or more; cases lasting more than 189 are counted as 189 day cases.) Occupation. Number of cases. Number of Number members. 2-^t7A°^ disability. Average compen- sated days of dis- ability per member. Average duration in days. Per case. Per member. Barbers Bartenders Bricklayers and masons Carpenters Painters Plasterers Plumbers Sheet metal workers Building and construction Cooks and waiters Engineers and firemen Farmers, gardeners and florists. Freight handlers Laborers Auto, etc., manufacturing Clay products Clothing manufacturers Dyers Electrical workers Food Slaughtering and meat packing Glass workers Jewelers Tanners Leather works Liquor manufacturers Blacksmiths Machinists Molders Meial workers Printers Stone cutters Textile manufacturers Tobacco Manufacturing employees Miners Professional Trade and clerical Drivers Railroad employees Wood workers All others* Total 150 307 408 2,245 672 71 204 362 80 357 543 174 164 3,416 127 104 621 115 145 1,115 992 162 103 253 647 2,939 396 2,454 509 1,113 411 203 926 1,702 600 1,742 103 643 1,477 122 979 1,472 31, 328 2,290 2,241 11,586 4,389 558 1,448 2,343 588 2,339 3,378 1,203 724 17,700 735 652 4,847 748 988 7,507 5,724 955 1,169 1,466 4,316 14,324 2,053 16,023 2,838 6,907 3,401 1,172 7,287 8,897 4,164 7,068 1,192 5,591 6,890 691 6,093 9,258 184,985 6,569 13,629 16,036 83,829 27,897 3,352 6,992 13,050 3,693 14,375 20,293 5,753 6,676 117,053 4,598 3,878 23,418 4,786 4,353 42,906 36,676 5,907 4,046 10, 113 26,537 107,591 14,468 89,483 15,840 36,471 19,490 8,295 33,648 66,885 21, 160 61,870 3,349 24,504 55,366 4,921 39,746 55,491 .1,164,993 4.4 43.8 5.1 44.4 5.9 39.3 5.9 37.3 5.3 41.5 5.1 47 2 3.8 34 3 4.5 36.0 5.3 46.2 5.1 40.3 4.9 37.4 3.8 33.1 7.6 40.9 5.3 34.3 5.0 36.2 4.8 37.3 3.9 37.7 5.3 41.6 3.4 30.0 4.7 38.5 5.2 37.0 5.0 36.5 2.8 39.3 5.7 40.0 5.1 41.0 6.1 36.6 5.6 36.5 4.5 36.5 4.3 31.1 4.2 32.8 4.9 47.4 5.9 40.9 3.7 36.3 6.2 39.3 4.1 35.3 7.0 35.5 2.2 32.5 3.6 38.1 6.5 37.5 5.9 40.3 5.4 40.6 4.9 37.7 5.1 37.2 5.3 6.0 6.0 4.8 5.6 6.3 6.1 6.0 4.8 9.2 6.6 6.3 6.2 3.5 6.9 8.8- 2.8 4.4 8.0 7.1 6.5 6.0 6.3 * More than 80 occupations are included under this heading. 345 TABLE VI — AVERAGE DURATION OF DISABILITY PER CASE AND PER MEMBER, BY AGE GROUPS. (These figures are based on cases lasting- eight days or more ; cases lasting more than 189 days are counted as 189 day cases.) Age. Number of cases. Number of members. Number of days of disability. Average compen- sated days of dis- ability per member. Average duration in days. Per case. Per member. Under 20 . . 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 70-74 75-79 80 and over Total.. 76 1,072 2,237 3,070 4,228 5,069 5,319 4,682 3,330 1,541 485 46 9 2 31,170 406 7,168 15,267 21,886 27,496 30, 746 31,579 ._25,484 16,229 6,686 1,843 170 49 6 185,011 1,855 30,406 69,720 97,345 143,710 185,596 197,827 185,852 144,666 78,234 25,221 2,454 443 227 1,163,556 3.3 3.2 3.5 3.5 4.2 4,9 5.1 6.0 7.5 10.1 11.8 12.5 7.8 35.5 5.1 24.4 28.4 31.2 31.7 34.0 36.6 37.2 39.7 43.4 50.8 52.0 53.3 49.2 113.5 37.3 4.6 4.2 4.6 4.4 5.2 6.0 6.3 7.3 8.9- 11.7 13.7 14.4 9.0 37.8 6.3 346 TABLE VII — AVERAGE DURATION OF DISABILITY PER CASE AND PER MEMBER BY SELECTED AGES. (These figures are based on cases lasting eight days or more ; cases lasting more than 189 days are counted as 189 day cases.) Number of cases. Number of members. Number of days of disability. Average compen- sated days of dis- ability per member. Average duration in days. Age. Per case. Per member. 20 149 326 565 742 935 1,017 1,001 809 401 144 18 4 786 2,367 3,978 5,043 6,144 6,404 5,789 4,200 1,982 661 70 18 3,405 9,585 18,502 29,402 32, 738 35,680 39,154 35,578 19,849 7,107 1,186 119 3.0 3.1 3.7 4.8 4.3 4.5 5.6 7.1 8.6 9.1 15.1 5.1 22.9 29.4 32.6 39.6 35.0 35.1 39.1 44.0 49.5 49.4 65.9 29.8 4.3 25 4.0 30 4.7 35 5.8 40 5.3 45 5.6 50 6.8 55 8.5 60 10.0 65 10.8 70 16.9 75 6.6 Total 6,111 37,442 232,305 5.1 38.0 6.2 347 SPECIAL REPORT III. DISPENSARIES AND CLINICS IN ILLINOIS. [Note by the Secretary. — Because of the importance of the public dispensary in meeting the needs of the sick poor and because of tlie question of abuse frequently- raised in connection with the admission of patients, the Commission planned to make an inclusive investigation of the dispensaries in the State. Mr. Harold Fish- bein was assigned to this special investigation. Before his report was completed, however, he was accepted for military service. His data have been presented in summary form by Mr. Ransom, a member of the Commission.] Medical charity in most communities of considerable size may be afforded in one or more of several ways. Most doctors have private patients who are unable to pay for the service rendered them and con- sequently receive it gratuitously. Counties, townships or municipalities may employ physicians to give medical service to indigent persons in their own homes. Hospitals both public and private furnish free service to the poor. Dispensaries and clinics provide medical treatment for large numbers of poor people. Because of the importance of dispensaries and clinics and the ques- tions raised as to the place they should occupy in the provision for medical care, the Commission has sought to investigate them as thoroughly as possible. As com^plete data as could be obtained with the conditions under which the investigation was made were secured from these institutions. The Dispensary investigation did not, however, cover certain types of institutions. Those excluded were (a) dispensaries operated by city and county physicians, (b) clinics affiliated with the Schools of Chiropody, of which there are three in Chicago, (c) Infant Welfare stations of which there are many in Chicago and a smaller number in other cities of the State, (d) hospital out-patient departments main- tained by corporations for the treatment of employees, and (e) out- patient departments of the U. S. Marine Hospitals at Cairo and Chicago maintained for the treatment of members of the Merchant Marine. In Chicago all dispensaries are operated subject to control by the Department of Health under a city ordinance. Hence, it was possible to easily obtain a list of all Chicago dispensaries. Elsewhere in the State no official lists of such institutions were available, but by use of directories and with the help of hospitals and public health authorities practically all of the dispensaries in the State were located. Ninety- eight dispensaries and clinics of the various types were located and studied. Nine others had ceased operation during the last year be- cause of the enlistment of many of their staff members in the Medical Corps of the Army and Navy.' Location and classification. — Of the 105 dispensaries studied, 60 are in Chicago and 45 in other parts of the State. Dispensaries may be 348 divided into two classes— general and special. A general dispensary is one which does not limit its service either as to class of diseases or types of patients. A special dispensary may treat only one disease- as tuberculosis, or one group of patients— as children, or may use a specialized form of treatment— as osteopathy. Special dispensaries may be further classified as in the table below, which shows the location and types of dispensaries included in this investigation. CHICAGO. 1 Q General dispensaries Special dispensaries — ' „ Eye, ear, nose and throat ^ Women and children * Children * Obstetrics 5 Venereal disease ^ Osteopathy, chiropractic, etc o Dental 1 J Tuberculosis ° '*-'■ 60 ILLINOIS OUTSIDE OF CHICAGO. General dispensaries 8 Special dispensaries — Tuberculosis 18 Infantile paralysis 11 Other special dispensaries 8 37 45 Other factors than convenience to the public have in many ways determined the location of the dispensary. Those connected with medical schools have had their location fixed by the location of the schools which in turn are located in relation to hospitals. In Chicago there are two fairly well defined medical centers, one on the West Side and one on the South Side. In these two rather restricted areas are located eight of the larger general dispensaries and two large dental clinics. For the Municipal Tuberculosis Dispensaries and school dental clinics the city has been divided into districts and the dispensaries located so that all, or nearly all parts of the city are served. The location of other dispensaries has been determined by that of the hospitals, churches, social settlements, etc. The result is that there are large areas in Chicago in which the population has no ready access to dispensaries, while in other areas patients may choose among several such institutions which are conveniently accessible. Support and control. — As to their support and control dispensaries may be classed as public and private. Most of the tuberculosis dis- pensaries are supported out of public funds. The same is true of in- fantile paralysis clinics, school dental clinics and a few others. In some public dispensaries patients who are able to do so pay fees, the money thus obtained going to augment the public appropriation for the support of these institutions. Private dispensaries are controlled by private corporations or organizations. Their support may come from one or more of several sources. Those connected with medical and dental schools may be supported in part by the schools. Out-patient departments of hospitals are supported out of the same funds as are the other departments in the hospitals with which they are connected. 349 -Other dispensaries may be supported privately as charitable institutions by people interested in this form of philanthropy. In many dispensaries patients pay small fees which go to the support of these institutions. Insufficient and uncertain financial support has been a potent factor in checking the development of dispensaries. There is frequently in- adequate service because the money is lacking to properly construct, equip, administer and man these institutions. Dispensaries in Chicago are subject to certain supervision and control by the Department of Health under a city ordinance. This ordinance makes certain speci- fications as to sanitary conditions, records, isolation of contagious cases, reporting of cases of reportable diseases, etc. All dispensaries in the city are subject to inspection by the Department of Health and must pay an annual license fee of twenty dollars. Except as indicated above, the Commission's investigation em- braced every type of dispensary and clinic — the general and the special, the medical and the dental, the public and the private. Questionnaires were sent to all the dispensaries located, with the exception of the Chicago Tuberculosis Dispensaries (information about which was obtained through the dispensary Department of the Municipal Tuberculosis Sani- tarium for which we are indebted), and the Infantile Paralysis Clinics maintained by the Department of Public Health. Where schedules were incomplete, personal visitations were made; these visits also enabled the Commission to obtain information not readily secured by the ques- tionnaire method such as relates to how records are kept and what in- formation they contain, conditions and equipment of clinics, methods followed in administration and treatment and the like. The "block studies" made in Chicago by the Commission show something as to the extent to which dispensaries are used, the attitude of people toward the dispensaries and extent of "dispensary abuse" (the use of medical service of dispensaries by those able to pay for treatment). The various types of dispensaries investigated were found to serve a large number of persons. The number of visits made to them by patients during the last year approximated 860,000. Of this number 835,000 visits were made to Chicago dispensaries. How many different patients were treated cannot be so accurately estimated because of the system of records kept. There is a quite general acceptance among dispensary officials of the estimate of an average of four visits per patient. On this basis 215,000 persons in Illinois sought treatment last year in dispen- saries. Of this number 208,750 visited Chicago dispensaries. Taken in relation to population these figures indicate that in the State as a whole seven out of every 200 people sought medical service in these institutions. In Chicago the figures were 17 out of every 200. What it costs to serve these patients cannot be estimated with any degree of accuracy. Nine of the dispensaries with 222,803 visits and with receipts from patients amounting to $55,942, reported expenditures totaling $106,389. The expenditures reported do not, however, in the larger number of cases, include sums spent for heat, light and rent, which are donated by the affiliated institutions. In fact the figures given show little more than a part of the operating expenses. In this 350 connection it is to be remembered also that most of the service of physi- cians is donated. The dispensaries and clinics of Chicago exclusive of tuberculosis and dental clinics, which are operated in a different manner and are dealt with especially in this report, have on their staffs 742 physicians of whom only 37 are paid. Three dispensaries outside of Chicago reported 47 physicians on their staffs, all donating their services. The amount of time given by the many physicians varies considerably. In some cases it is only one hour, in others several hours per week. Dispensary administration, procedure and class of treatment differ from one institution to another, for there are dispensaries and dis- pensaries; the good and the bad; those operated at a loss and those that make a profit; those which treat every one irrespective of ability to pay and those which make close inquiry into financial status; those which give every form of treatment from the removal of a splinter to treatment by hydrotherapy; there are institutions which use every known thera- peutic agency grading down to those which use a specialized form of treatment as yet in an experimental stage. An adequate discussion of the subject of dispensaries must take each type into consideration. For this purpose the following outline will be used : I. Medical Dispensaries — E'xclusivb op Tuberculosis Clinics AND Infantile Paralysis Clinics. A. The General Dispensary — treating all cases, (1) those with specialized departments and (2) those without specialization. B. The Specialized Dispensaries. (1) Eye, ear, nose and throat; (2) maternity; (3) women and children; (4) children; (5) venereal disease; (6) osteopathic C. Chiropractic, Naprapathic, and Nature-cure. II. Tuberculosis Dispensaries. A. Municipal B. County III. Infantile Paralysis Clinics. IV. Dental Clinics. The general dispensary. — The departments usually found in the general dispensary are (1) General Medicine, (2) Surgery, (3) Genito- urinary, (4) Dermatology, (5) Laryngology, (6) Paediatrics, (7) Gynecology, (8) Neurology, (9) Opthalmology. There may be further specialization within these various departments with such sub-depart- ments as orthopedic surgery, oral surgery, rectal surgery, tuberculosis, obstetrics, massage, speech and hydrotherapy. Some dispensaries have only a few of these departments, grouping all cases under the heads of General Medicine, Surgery, Gynecology, Paediatrics, Genito-Urinary and Dermatology, while in others all the departments named are main- tained. • As shown in the table above, 27 of the 105 dispensaries found in the State are general dispensaries. Nineteen of these are in Chicago and one each in Springfield, Peoria, Evanston, Oak Park, Eock Island, 351 Eockford, Argo and Blue Island, respectively. The dispensary in Oak Park is maintained by Cook County. Those in Eockford and Peoria are maintained by social settlements. The others in cities outside of Chicago are hospital out-patient departments. Of the nineteen general dispensaries in Chicago which gave 334,649 treatments last year, eleven are affiliated with medical schools. These combined treatment of patients with instruction of students. To these eleven institutions 252,449 visits were made last year. The total comprised 46 per cent of the treatments given in Chicago dispensaries, exclusive of the tuberculosis and dental clinics. Five of the general dispensaries are maintained as hospital out- patient departments. One of the five, the Emanuel Mandel Memorial Dispensary, though the out-patient department of Michael Eeese Hospital, is located in a different section of the city from the hospital. These five dispensaries had 72,741 visits last year. The three other general dispensaries are maintained by charitable organizations, two by church settlements, and one by the Salvation Army. The number of visits made to these three dispensaries last year was 9,459. Buildings and equipment. — Few dispensaries occupy quarters espe- cially designed for the examination and treatment of patients. The Emanuel Mandel Memorial Dispensary and the Maxwell Street Dis- pensary of the Chicago Lying-in Hospital have buildings used exclus- ively for dispensary work. Dispensaries affiliated with medical schools use rooms in some of the college buildings which may or may not be well adapted to the work for which they are used. Hospital out-patient depart- ments are usually located in basements of the affiliated hospitals. Dispen- saries operated by churches and settlement houses make temporary use of the rooms in those institutions. The Sanitary Code of Chicago requires each dispensary to provide a suitable room for the isolation of cases of contagious disease until such patients shall have been taken charge of by the Department of Health. Such rooms must have both "separate toilet facilities and a supply of running water." Some dispensaries have one general waiting room from which patients are assigned directly to physicians. Others have a general waiting room and smaller departmental waiting rooms. In eleven out of sixteen of the larger dispensaries in Chicago, the general waiting rooms are in the basements, making proper lighting and ventilation difficult and in some instances unobtainable. In some dispensaries wait- ing rooms are frequently overcrowded. The rooms used for treatment of patients were in general found to be well lighted and ventilated. The Commission did not obtain much detailed information con- cerning the equipment of dispensaries studied. In general we may say that those dispensaries affiliated with medical schools and hospitals are well equipped for laboratory, x-ray and other diagnostic work. In most other dispensaries, if such service is required, patients are referred to other clinics or to physicians with whom the dispensary has arranged . for such service. Equipment in modem, scientific, diagnostic and therapeutic pro- cedure is essential to the best medical service, and those dispensaries 352 which can place such facilities at the command of their physicians will, other things being equal, give their patients the best institutional medical^ service. Supervision. — ^Efficient dispensary service is dependent in part upon competent management. If those who control a dispensary's policies and direct its activities, realize the significance of the work the institution can perform and plan to make that work commensurate with public health needs, such an institution will be an important part of the com- munity's medical facilities. If there is not management of this type, and too frequently there is not, a dispensary's value may be very limited. From the standpoint of the community, the value of a dispensary de- pends upon the type and quality of its medical service, upon the con- tribution it makes to the health and physical well-being of the people it serves. Its relation to medical school, church, social settlement or other organization is significant only in relation to this primary function. Management of a dispensary is usually in the hands of a Board of Directors especially if the institution is a separate entity. Dispensaries which are integral parts of other institutions such as medical schools, hospitals or institutional churches, etc., are usually under the control of a committee of the Board of the institutions concerned. If the dis- pensary is of considerable size it is likely to be better managed if it has a supervisor giving his full time to the work. Two Chicago dispensaries have paid superintendents; in other institutions the supervisor may be the secretary of an affiliated medical school, a nurse assigned by the hospital to its out-patient department or the senior physician of the dis- paisary staff. These supervisors, of course, can give only a part of their time to dispensary affairs. Admission and registration. — ^The admission system of a well organ- ized dispensary should fulfill three functions: 1. To register all patients with sufficient information concerning each that indentification will be possible at any future time; 2. To obtain sufficient information concerning each patient's com- plaint that he may be assigned to the proper clinics ; 3. To ascertain whether or not each patient is financially qualified for treatment in a dispensary. In the registration and assignments of patients the first two of these functions seems to be well taken care of in most of the Chicago dispensaries. With reference to the fina.ncial status of patients con- sidered eligible for dispensary service, standards vary from one insti- tution to the other. Some dispensaries exercise care in this matter, while others admit practically all who apply. Reports. — Dispensaries must report to the local health authorities all cases of contagious disease diagnosed by their physicians. In Chicago all dispensaries must make a monthly report to the Department of Health giving the number of new and old patients treated and classified as to sex and age group. They are required to report in considerable detail all patients under their treatment for venereal disease. They must also file an annual report classifying all patients under their re- spective diagnosis. 353 Records. — Chicago dispensaries are required by law to keep a record of each patient stating age, sex, occupation, diagnosis and other essential facts. Two or three Chicago dispensaries have well organized record systems from which statistical information can be drawn. Most of the others have too limited a clerical force to make possible proper keeping of records. Dispensary service. — The quality of medical service furnished by a dispensary depends upon several factors. Of primary* importance is the staff. The Commission made no inquiries concerning the qualifi- cation of physicians serving on dispensary staffs. Those dispensaries connected with high grade medical schools probaby have an advantage in attracting medical men of ability. As mentioned above, equipment and other facilities affect the quality of the work an institution performs. Dispensary patients frequently complain of the long time they have to wait in order to see a doctor. With the present organization of most dispensaries much of this waiting is unavoidable. Doctors can give only limited amount of their time to dispensary work. If a dispensary renders good service its clinics are sure to be crowded. A greater diffi- culty than having to wait is likely to befall the patients in the more widely patronized dispensaries— that of receiving but a few minutes of a busy doctor^s time. In many dispensaries there are either too many patients or too few doctors to make for satisfactory service from the standpoint of either patient or physician. Ten Chicago dispensaries hold night clinics, but six of these are for venereal disease patients only. One dispensary has established an evening clinic for working people. With these few exceptions, dispensary facilities are unavailable for the working man or woman who is sick but not too sick to work. As men- tioned earlier in this report, the dispensaries of Chicago are located chiefly in two rather restricted are&s. The block studies show that those families living in the vicinity of dispensaries take much greater advan- tage of dispensary treatment than do those who live at any considerable distance from such institutions. Social service. — Since unfavorable social conditions may cause, accompany, or result from sickness, the treatment of these conditions becomes an important part of efficient medical treatment. Recognition of this fact has led to the establishment of social service departments in many of the better hospitals and dispensaries. Such a department aims to supplement the work of the doctor by giving attention to various elements in the patient^s environment which need correction, to problems in the solution of which he needs help if the doctor^s work is to be cur- ative rather than palliative. The dispensary social department is usually charged with the re- sponsibility of seeing that patients who need to continue under treat- ment for some time come to the institution as long as observation and treatment seem necessary. This work is commonly known as "follow- up." The patient suffering from disease which requires a considerable period of treatment gets little benefit from one visit or a .few visits. Efficient "follow-up" through securing the cooperation of the patient, —23 H I 354 through writing to him or visiting him if he interrupts his treatment, has greatly increased dispensary efficiency. Correction of living and working conditions are often essential to successful medical treatment. Seeing that such corrections are made is another function of the Social Service. Arrangements for dental service, for hospital care, for con- valescent care, for home nursing, etc. are frequently made through a social service department. Through this department, acting as a clear- ing house, patients may be referred to any of the community's social organizations whose service they may need. Agencies such as nursing organizations, relief societies, child welfare agencies, and the like refer many patients to dispensaries for diagnosis and treatment. Social service departments see to it that these agencies are informed as to the diagnosis and prognosis of patients so referred. Six Chicago dispen- saries maintain social service departments. In four others a visiting nurse is employed to do home nursing. In five others affiliated with charitable organizations, social workers do some dispensary work in connection Avith other duties. Twelve dispensaries have no social service or follow-up work of any sort. In dispensaries outside of Chicago social service for patients is frequently secured through cooperation with public health nurses, organized charity Avorkers and the like. Social service registration bureaus. — Chicago has two social service registration bureaus or confidential exchanges as they are sometimes called. One is operated in connection with the United Charities and the other by the Associated Jewish Charities. Various social and philanthropic agencies register the persons whom they sevYe with one or the other of these bureaus. From such registration any agency may ascertain what other agencies or institutions are serving or have served an individual or family. The use of these bureaus by dispensaries would give them valuable data concerning their patients, and would acquaint other agencies with the fact that persons in whom they are interested are under dispensary medical treatment. At the time the investigation was made five of the privately conducted dispensaries and the Municipal Tuberculosis Dispensaries were registering their patients with these bureaus. Dispensary abuse. — As dispensaries have increased in number and as their work has increased in volume, there has been the not infrequent criticism on the part of individual physicians and medical societies, that dispensaries bestow medical charity upon people who have no valid claim to it and who can well afford to pay for medical service. As long as dispensaries are primarily charitable institutions in which doctors receive no financial compensation for their services, they should be care- ful, as should other charitable agencies, to see that only those who need such free service, receive it. Dispensaries differ greatly from each other as to the care they exercise in limiting their service to bona fide mem- bers of the charity group. Some admit every applicant; others make financial investigations of practically all their patients and exclude all whose incomes are above a fixed standard ; still others fall between these two extremes, taking what seem to them to be reasonable precautions to keep out the financially ineligible. Careful investigations have been made at different times in Boston, New York, St. Louis and other cities of a considerable number of dis- pensary patients, to ascertain their claim to fiee medical service. These investigations have shown that only a small percentage, from two to five, of dispensary patients are really able to pay for the medical service they seek to obtain free or at nominal cost. In our study of 2,869 (heie are included only those families for whom complete statements could be obtained) families in Chicago (charity cases excluded) it was found that 511 families, or 17.8 per sent, had received some foim of dispensary service for one or more ^mem- bers within the preceding twelve months. Budget studies made in North Chicago and investigations made by the Bureau of Labor Statis- tics and by the War Labor Board indicate that for a family of five (man, wife and three children under 15) an income of $1,700 per year is necessary to meet all normal family expenses including average sickness costs. tJsing this figure as a basis of classification of the 2,869 families, we find that 1,717 had incomes of $1,700 or over, or equivalent sums for smaller or larger families, as against 1,152 with smaller incomes. Of the 511 families receiving dispensary service, 102 were in the group with the larger incomes (with a minimum of $1,700 or its equivalent). Of these 102 families, 24 were given service in municipal tuberculosis clinics, infant welfare stations or in special clinics established for aftercare of infantile paralysis, which institutions for obvious reasons do not limit their services to any economic group. This leaves 78 families in the higher income gi'oup receiving medical advice and treatment in dis- pensaries which in general confine their service to people of very limited income. These 78 families are 15.2 per cent of the 511 families with dis- pensary records. It is well to bear in mind, however, that the type of medical service needed is important in determining whether or not a patient is worthy of dispensary treatment. One may be well able to pay a general prac- titioner for treatment of a minor ailment or one of short duration, but unable to pay for a specialist's service if needed or for treatment con- tinuing through a long period of time. On the basis of type of service needed these 78 families divide into 55 whose condition of illness indi- cated the need of specialist service and 23 who presumably could have obtained all needed service from a general practitioner. From this analysis we may conclude that 23 families out of a total of 511, or 4.5 per cent, were recipients of medical charity which their economic status did not justify. This figure closely approximates the findings of the the investigations in Boston, New York and . St. Louis mentioned above. The public health dispensaries, for example those conducted by infant welfare organizations and by public or private agencies for the treatment of tuberculosis, usually treat all who apply regardless of financial ability. If pay clinics are established and with them a system of compensating dispensary physicians for their services, the question of dispensary abuse will tend to disappear. 356 i^ee^.— Dispensaries vary considerably in the charges patients are asked to pav, either for service, drugs or appliances. Some institutions make no charges whatever, while others request patients to pay lees approximating the cost of private service. In practically all cases those who cannot pay admission or other fees are treated free. Most dispen- saries act on the principle that small payments on the part of patients make for better cooperation between patient and institution. (a) Admission fees.— ^ome dispensaries have no admission fee; some charge ten cents to cover cost of registration; some make a flat rate qf twenty-five cents to cover both admission and prescription fee. The accounts of most dispensaries were found to be so kept that it is impossible to obtain the proportion of patients paying these fees. (b) Bmgs, — Charges for drugs vary from ten cents included m the admission fee to a rate of 25 to 50 cents for prescription up to the cost of drugs. Some charge 10 per cent more than cost to pay a part of the overhead expenses. This is done by dispensaries which charge a small admission fee or have no such fee at all. (c) G^/fls^e^.— Institutions which secure glasses for patients charge a rate varying from the cost price up to the cost plus 10 per cent. The common policy is to charge dispensary patients the wholesale rate. Some dispensaries refer patients who are unable to pay for glasses to charity bureaus some of which have arranged with optical concerns for free glasses for their beneficiaries. Some dispensaries have arrange- ments with optical companies which furnish glasses to dispensary patients at gveatly reduced rates. (d) Wassermcmn tests, salvarsan, etc. — The charges for Wassermann tests vary from 50 cents up to regular charge of $5. If patients cannot pay, such tests are made free of charge in some dispensaries. Other in- stitutions refer all indigent patients needing Wassermann tests to the Health Department Laboratory at the Iroquois Memorial Hospital which makes such tests free of charge. Charges for salvarsan treatment vary from $2 to $7.50. A few dispensaries furnish such treatment free to patients who cannot pay for it. (e) X-rays. — The charges for x-ray service vary from one dollar up to the regular rate charged by x-ray laboratories. Some dispensaries charge simply the cost of the service; one charges cost plus 10 per cent, while in another patients are given a 25 per cent discount from the regular commercial price. Some dispensaries give x-ray service to patients who cannot pay. (f) Tonsillectomies. — Dispensaries which are affiliated with hos- pitals perform tonsillectomies, arranging for the patient to stay at least twenty-four hours in the hospital. Charges for this service range from $3 to $10 including hospital bed fee. In some dispensaries such service is given to patients who are unable to pay for it. Accounts — receipts and expenditures, deficits. — Only one or two dis- pensaries investigated were operated at a profit. In fact practically all of them are dependent upon other sources of income than patients for a considerable part of their operating expenses. The accounting systems in general were found to be poor. Frequently dispensary accounts are not 35: beparated from accounts of the affiliated institutions. Actual cost of maintenance is therefore impossible to obtain. The average cost per patient's visit was found to vary from 11 cents in institutions in which costs of heat, light, rent, etc. were not included, to 78 cents in the case of one Chicago dispensary with all such expenses included. It must be borne in mind, however, that practicaJly all of the medical service in dispensaries is given free of charge by the attending physicians. In Springfield, the county of Sangamon maintains a dispensary as the out-patient department of St. John's Hospital. The hospital furn- islies several rooms for dispensary work and provides drugs and special forms of treatment at reduced rates. The hospital is reimbursed by the county for the amount thus spent. The dispensary treated 10,061 patients last year and was reimbursed by the county in the amount of $4,107.05. Conclusions. — The Commission's investigation has shown that dis- pensaries are important factors in providing medical service for the poor, and for people of moderate means. The location of Chicago dis- pensaries is not well adapted to the needs of the people for ready access to such institutions. Many dispensaries need improved quarters, equip- ment and record systems, and more doctors, social workers, clerks, etc. Fundamentally the problem of better dispensary' service is a question of more generous support on the part of the community. Dispensaries are a part of the community's equipment for protection against disease and for health conservation, and in the long run a community's health bears a close relation to what it is willing to spend for such protection and con- servation. The following table has been made to show in summary form for the more important dispensaries investigated in Chicago, certain outstanding facts. 358 SUMMARY TABLE FOR CERTAIN GENERAL General dispensaries. o a Equip- ment. Physicians. Admission fees. D o Vi CO 5 ® -v. 4.3 tJ CJOT eceipts patient xpendil light, h salaries supplie >> ab ora- tory. o a umber paid. m > 2 r- TO G Eh « W X ^ 1 ;z; Z Ph « Drugs. a O K) CO 3 5 ® a> ©:-H Equip- ment. 08 • O ui .Q O Physicians. <9 05 . ,Q .Q-O a a -3 s S Ph iz; iz; Admission fees. CO E^ rj CO S CO © > Drugs. © CO © ft CO © O leChiro... 17 Nature Cure 18 Naprap 19 Dental 20 Dental 21 Dental 22 Dental 23 Dental 24Tbc 11,000 1,500 7,000 Yes. No. 6 6 $1.00 $1.00 2,400 5,220 88,000 N. R. N. R. N. R. N. R. N. R. N. R. Yes. No. Yes. No. No. Yes. 6 2 30 6 2 30 $1 per week $20.00 for 36 visits 32,000 N. R. N. R. Yes. Yes. 15 6 3,012 N. R. N. R. Yes. Yes. 2 2 60,000 N. R. N. R. Yes. Yes. 12 12 49,420 N. R. No. No. 10 10 63,587 343,444 No. No. 20 20 No. No. No. Yes. i Cost of material Cost of material Cost of material Cost of material Cost of material 361' AND SPECIAL DISPENSARIES IN CHICAGO — Concluded. Glasses. O IM O Q, o 03 Wassermaiin tests. 05 P5 Tonsillec- tomies. ■ ^ X-ray. 03 OJ Social service. (-1 s o Dispensary hours. 03 4.9 xi No. No. No No. No. No. No. No. No. Yes. No. $5.00 No. No. Yes. Yes. $8.00 and up $3.00 up No. No. No. No. No. No. No. No. No. No. Yes. Yes. 25c to 50c 25c No. No. No. No. No. No. No. No. No. No. No. Yes. No. No. Yes. > No. No. Yes. 2-3 2-5 3-4 9-5 9-5 10-12; 1-6 9-5 9-3 9-5 Tu.-Fr. 7-9 6-8 Tu.-Fr. 7-9 362 Tuberculosis dispensaries.— The treatment of tuberculosis by the dispensary method has been greatly developed in Illinois within the last few years. The State Campaign against Tuberculosis is elsewhere treated in this report.! So far as institutional treatment of tuberculosis is con- cerned, this work was formerly done chiefly in a department of a general dispensary, but as specialization in the treatment of this disease developed ajid as organizations both public and private assumed the task of pro- viding treatment, special tuberculosis dispensaries and sanitaria have been established. In the State of Illinois there are at present 26 tuberculosis dis- pensaries. Eight of these are in Chicago, five are in Cook County outside of Chicago and thirteen are in the State outside of. Cook County. The eight Municipal Tuberculosis Dispensaries in Chicago are operated by the Dispensary Department of the Municipal Tuberculosis Sanitarium. No charge is made to patients treated; nurses visit the homes of all patients treated and give instruction as to care and hygiene. Twenty full time physicians are employed, their salaries ranging from $2,500 to $3,500 per year. Dispensary hours are from 9 to 5 daily except Saturday and Sunday^9 to 1 Saturday, and on Tuesday and Friday evening clinics are held. One physician is on duty in each dispensary during dispensary hours while from each dispensary one physician is visiting patients' homes or doing survey work. In 1917 these dispensaries treated 17,953 new patients giving 56,394 clinical treatments, total num- ber of visits made by patients was 77,978. The cost of this dispensary service to the people of Chicago for the year 1917 was $343,443.74. Cook County, through its Bureau of Social Service and the Chicago Tuberculosis Institute conjointly support and control five tuberculosis dispensaries outside of Chicago. These are located in Argo, Blue Island, Oak Park, Arlington Heights and Oak Forest. These five institutions were recently organized and as yet have not been extensively utilized. They are open from one to three hours on certain days of the week. Phy- sicians in these dispensaries are not paid. Social service and follow-up work is done by nurses either in the service of the County or Chicago Tuberculosis Institute. In the State outside of Cook County there are thirteen tuberculosis dispensaries. All of these dispensaries, with the exception of the one in Springfield, have been organized within the two years. In 1917, 4,253 treatments were given in five of these dis- pensaries. The other five make no report as to the number of new patients or the number of visits to the dispensary. No charges are made to patients and physicians for the most part donate their services although in three dispensaries one salaried physician is employed. These dis,- pensaries are open on certain days of the week and at certain specified hours. Visiting nurses, charity organizations and other agencies co- operate with these dispensaries. The treatment of tuberculosis differs from the treatment of most other diseases in the regularity and frequency of the treatment neces- sary. A person of even moderate circumstances has difficulty in meet- ing the expenses of constant treatment, and the campaign against * Part I, Chapter II, Section 4. 363 tuberculosis has such general acceptance that there is little opposition to the granting of this dispensary service to all who apply. Hence the question of dispensary abuse is rarely raised. As counties are rapidly taking advantage of their power to levy an extra tax for the maintenance of tuberculosis work, the number of tuberculosis dispensaries in the State will show a marked increase in the next few years. Infantile paralysis clinics. — (From the Report of Dr. C. W. East to the Department of Public Health.) The Division has conducted clinics for the after care of infantile paralysis at weekly and bi-weekly intervals at Springfield, Chicago Heights, Blue Island, Oak Park, Evanston, Joliet, Ottawa, Eock Island, Moline and Quincy. Our bi-weekly clinics show that we have averaged 175 patients per clinical week in the territory of the State outside Springfield. The Springfield clinics averages 30 patients per week which brings the aver- age bi-weekly clinical attendance to 235. If averaged on a weekly basis, this Division of your department ministers directly and personally to 117 crippled patients per week. Our figures show that of this at- tendance upon the clinics 80 per cent were crippled by infantile paralysis, and 20 per cent by other diseases such as tuberculosis, rickets, cerebral palsy, and injury. County and city authorities, clubs and individuals have contributed to the brace and supply fund, which has been administered by local agencies, and to such a degree of completeness that no child for whom a brace, surgical operation or hospitalization has been necessary has had to do without it. About $2,500 has been thus contributed entirely by local initiative. Your representative has not passed the hat. The people have come to the clinics, they have heard and seen and have pro- vided fully all supplies needed. Several cities are now urging the establishment of clinics, offering us complete hospital and follow-up facilities. The needs are as wide as the extent of the crippled population of the State. These needs are yearly augmented by fresh crops from epidemic paralysis. Dental Clinics. — Differing greatly from the medical dispensary as to the nature of their administration are the dental dispensaries. There are four regular dental clinics in the city of Chicago, and until recently there were fourteen dental clinics for school children operated by the division of Child Hygiene and the Department of Health. Besides these there is one dental clinic in LaSalle County also conducted for school children. Three of the Chicago dental clinics are departments of regular dental schools. In these clinics all clinical operations are performed by students. Patients, unless referred by charitable organi- zations, pay the cost of all materials used. No charges are made for ex- tractions, and no inquiries are made concerning the financial standing of patients. These three clinics, which are open from 9 a. m. to 5. p. m. daily, have fifty-seven dentists on their staffs of whom 48 are paid. These dentists do little of the treatment work; however, 180,000 treat- ments were given in these three institutions last year. A fourth clinic 364 is operated by a school of mechanical dentistry. Eegular doctors of dental surgery perform all extractions, make fillings, impressions, etc. Students make plates and bridge work from these impressions. Patients are charged minimum prices. Three thousand and twelve treatments were given in this institution in 1917. The school clinics operated by the Chicago Department of Health employed 10 dentists in 1917 working full time in ten clinics located in different sections of the city.^ In 1917, 49,420 treatments were given in these clinics. School health officers make examinations and advise parents of dental defect. The school nurse then follows up this noti- fication to the parents. If the family is unable to pay for dental work, the work is done in the school dispensary. The Hygienic Institute in LaSalle does a similar work. No statistical information was available from this clinic. ' The number of cUnics vrsis reduced to 6 in 1918. 365 SPECIAL REPORT IV. OCCUPATIONAL DISEASES IN ILLINOIS. (By Alice Hamilton, M. D.) [Note hy the Seci'etary. — A special Commission created by the Illinois Legisla- ture made an investigation of occupational diseases in Illinois and reported its findings in 1911. Only a very extensive and most thorough investigation by this Commission of such diseases would have been justified. Neither the time nor the funds were available for such an investigation. Moreover, it would have been im- possible to obtain the services of experts in this field during the wai-. Accordingly, the Commission decided it advisable not to make an investigation of occupational diseases in Illinois. But, fortunately, the Commission had among its members Dr. Hamilton who eight years ago directed certain of the investigations for the Illinois Commission on Occupational Diseases. For years she has been employed by the U. S. Bureau of Labor as an expert investigator in this field, and her investigations for that Bureau have enabled her to keep in touch with the situation in Illinois. Beca.use of these qualifications Dr. Hamilton was asked to prepare a summary statement of occupational diseases in this State. Her summary statement is made in response to this request, and is presented here.] It is difficult to say just what is an occupational disease. Cases of poisoning from a substance which is used in industry, and which sets up a definite train of symptoms, can be easily recognized and present no difficulty. If a steel foundry man falls unconscious, overcome by carbon monoxide gas from a blast furnace^ the case is accepted without question as caused by the occupation. But if a presser in a poorly ventilated tailor shop, where the air is contaminated with carbon monoxide from the gas jets, is suffering from anaemia and neurasthenia it is very hard to establish a connection between his occupation and his sj^mptoms. It is easy to diagnose lead poisoning in a painter with colic and wrist drop, but much harder to recognize it in a compositor who has general harden- ing of the arteries. Acute occupational poisoning is a fairly simple problem. Chronic occupational poisoning is much more difficult. But most difficult of all is an occupational disease that is caused not by a poison, but by some other form of injury. Industrial tuberculosis is one of the occupational diseases which presents great difficulty, because, though there are some dusty trades with a tuberculosis rate so greatly in excess of the average as to show beyound doubt that the occupation is in some way related to the disease, yet it is hard to prove- that any indi\ddual case is to be attributed to the man's work and not to something in his life outside of the work shop. Even more difficult is it to establish the responsibility of an industry when the factors that produce disease are fatigue, over- work and low wages. We know that fatigue lowers resistance to the germs of disease, and that chronic fatigue brings in its train serious dis- turbances of nutrition and of the nervous system. But to prove that an over-long working da}^, or too heavy work, is responsible for these symptoms in any one man or woman, is well nigh impossible. The same thing is true of the ill-health which is caused by low wages. That low 366 wages mean insufficient or improper food, poor living quarters, un- healthful recreations and worry, nobody would deny. Nor would they deny that all of these things affect the health, but it would never be possible to say with certainty that an anaemic, emaciated woman, with indigestion, constipation, neuralgia and sleeplessness is suffering from an occupational disease because she is working for less than a living wage. Therefore, we can never make the term occupational diseases cover more than a small fraction of those that are really set up or influenced by occupation. We can venture to include under this head only those that are caused by poisons, by very injurious kinds of dust, by extremes of heat and cold, by sudden excessive exertion resulting in acute dilation of the heart by infection with anthrax or sometimes hookworm and by compressed air. There will have to be a great deal more intensive in- vestigation in this field before we can bring under this head other causes o'f disease which we know to be affective but of whose affectiveness we have not yet sufficient proof. Even the cases of occupational disease which would come under the list given are not by any means all diagnosed as occupational In the State of Illinois a law known as the "Occupational Disease Law" came into effect July 1, 1912. This law requires physicians to be employed in establishments smelting lead and zinc, manufacturing or handling lead compounds, brass and compounds of arsenic or in which poisonous chem- icals, minerals or other substances are used or handled. These phy- sicians must make physical examination of the workmen once a month and report monthly to the Factory Inspection Department the cases of occupational disease which they discover. The law was one of the first of its kind passed in the United States and represented a decided step forward, but is very imperfect; it does not enumerate nearly all the oc- cupational poisons and, as pointed out by the Department, it does not cover workmen such as journeyman painters and plumbers who do not work in factories and are not examined or reported on. Xor does it apply to physicians who are not attached to manufacturing plants and who yet may see many cases of poisoning from these plants. There should be compulsory reporting of all industrial diseases by all physicians and hospitals. Probably the law works as well in the lead industries as can be ex- pected, and yet it would be a great mistake to think that the number of cases of poisoning reported to the department represent the actual num- ber of those poisoned with lead in any one industry. For various reasons, physicians employed by manufacturing estahlishments often report only a small proportion of the cases that occur in the plant, as has been pointed out in a Federal inquiry.^ The working of the Illinois law, therefore, does not result in records of occupational poisoning that are complete. The requirements to re- port cases should apply to all physicians. But in addition to this some check would have to be applied to the company doctors. It would be well if phy sicians connected with the State Factory Inspector's office 1 BULLETIN 141, U. S. Bureau of Labor Statistics, p. 79. 367 could, at certain intervals, go through the plants, examine the men and check up the company doctor^s reports. LEAD POISONING. This is universally considered the most important of the industrial poisons. The Illinois Commission on Occupational Diseases made a necessarily incomplete study of the lead trades in the State during the year 1910, and found that lead poisoning had occurred in no less than 70 occupations. Three hundred and eight cases of lead poisoning were found to have occurred during 1910, but this figure was known to repre- sent only a small fraction of the real number. The records of the Factory Inspection Department following the passage of the law con- cerning examination and reporting, show a gratifying reduction from year to year in the number of cases. Year. Firms reporting. ' Average nvimber employees. Number cases. Per cent of cases. 1912-3 , . . . . H'^'' 40 135 H 257 135 150 1,880 5,320 5,675 5,492 6,150 172 355 189 138 149 9.15 1913-4 6.67 1914-5 3.33 1915-6 2.51 1916-7 2.40 The lead industries reporting under this law are the smelting of lead, refining lead, the manufacture of leaden machine parts, wire, pip- ing, sheet lead, making solder and babbitt, lead tempering, lead burn- ing, making car seals and bearings, making tinware, lithotransfer work, the coiToding of white lead, grinding paint, roasting oxides, making stor- age batteries, making and using lead enamels. From the factory in- spection reports it is evident that the lead trades, well known to be dangerous, such as smelting and refining, making white lead, roasting oxides and making storage batteries, have been rendered much safer than the relatively harmless trades, such as making car seals and bearings and making tin cans. In 1913-14 four can-making establishments re- ported no less than 184 cases (the sum of cases reported in twelve months) of lead poisoning, although the combined payrolls numbered only 123. Vigorous efforts on the part of the Factory Inspection Depart- ment reduced this number to 10 in 1916-17, though the number of em- ployees was then almost 300. This industry, it must be remembered, is not inherently dangerous, for the lead that is used in soldering is not raised to a great heat and is not nearly as poisonous as are the compounds used in other industries. Large numbers of women are employed in soldering. Illinois has two dangerous lead trades not found in every state, the making of lithotransfer paper for decorating pottery, and the enamelling of sanitary ware. The former involves exposure to very finely ground lead colors, employs girls chiefly and has always had a fairly high rate of lead poisoning. The latter employ men who scatter a finely ground glass enamel containing soluble lead over the red hot 368 surface of the bath tub or sink. In 1911 an examination of 148 enamel- lers showed that 54, or 36 per cent had chronic lead poisoning and 38 men had highly suspicious symptoms.^ This industry reported no cases of lead poisoning in 1916-17," but there is reason to believe that it is still prevalent among enamellers. The painters' trade is not covered by the Occupational Disease Law except when it is carried on in a factory, and, for the most part, the painting done in factories involves less danger of lead poisoning than the work of the journeyman painter. It is true that a good deal of lead is used in the painting of carriage and automobile wheels, and on the bodies of the more expensive vehicles, and also in the interior of passenger cars, but machine painting is taking the place of hand work to a great extent and leadless paints are very largely used. Furniture, picture frames and mouldings, agricultural implements, farm wagons, are painted with leadless paint, and are usually dipped in tanks of paint. All of this work comes under the law. It would be impossible to discover how much lead poisoning 1?here is among the 28,000 journeymen painters, but we have records of two in- tensive examinations of small groups. Dr. E. E. Hayhurst, of the Illinois Commission, now of the Ohio State Board of Health, examined 100 working painters in Chicago in 1913. He did not find symptoms of acute lead poisoning in any case, but chronic lead poisoning was evident in 59 cases.^ If the same proportion holds good throughout the trade, 16,520 Illinois painters have their health more or less seriously impaired as a result of their work. In 1915 the physicians of the Factory In- spection Department examined 150 painters and found that 23 had had lead colic, 26 had active pulmonary tuberculosis and 10 more had it in an early or latent form, 49 had hypertrophied heart, 9 of these with valvular trouble, 22 had chronic nephritis and 25 rheumatism. This is the record of a very unhealthful trade, if we can assume, and there seems to be no reason why we should not, that these two groups represent the average journeymen painters in the State. In addition to the lead which painters handle, they are exposed to other poisons when they use quick drying paints or paint removers, or varnishes, which are likely to con- tain wood alcohol, benzol, carbon tetrachloride, and naphtha. Turpentine is also a poison to which painters are exposed, and they suffer besides from cold and dampness when working in new buildings, and some- times from the carbon monoxide gas which is generated by the salaman- ders, that is, the small charcoal burners used to dry the walls of new buildings. The amount of disability caused by an attack of lead poisoning may be great, or it may be fairly slight. Just how much disability and eco- nomic loss is involved, loss of wages during illness and earning capacity after recovery, it is hard to say. Acute lead poisoning usually seems to mean a sojourn of five to fifteen days in a hospital, after which the patient is discharged "cured." However, this does not always mean that the man is well enough to go back to work. Even in mild cases it may 2 BULLETIN 104, U. S. Bureau of Labor Statistics, p. 61. * BULLETIN 120, U. S. Bureau of Labor Statistics, p. 51. 369 be a month before he has recovered his strength, and many cases are not mild. If his attack has been accompanied by anaemia, great weakness or partial paralysis, or if there is marked paralysis and involvement of the brain, kidneys, blood vessels and heart, he may never completely recover and he will certainly be incapacitated for months at the best. In one lead smelter in 1913 as many as 30 per cent of the cases of lead poisoning were of this character. Fifty-three per cent of the cases of plumbism in American potters (men) were at least moderately severe, and 60 per cent of the sanitaiy ware enamellers who were poisoned suffered from organic or nervous symptoms.* But it is among painters, who are likely to remain long at their trade, that one finds the largest proportion of cases of serious plumbism. A study of 100 lead poisoned painters in Chicago showed that only 33 had had simple lead colic without complication, 42 had had palsy, 9 cerebral lead poisoning, 11 disturbances of vision and 11 general harden- of the arteries.^ Even simple acute lead poisoning, uncomplicated, may be slow to clear up. For instance, the records of 12 lead poisoned pasters in a storage battery factor}^, were traced for a year after their illness. These men had only been employed in pasting for two to eight months. Two of them had recovered from their lead poisoning at the end of three weeks^ time ; one at the end of four weeks, but the remaining eight were in poor health for periods running from five weeks to four months.^ OTHER OCCUPATIONAL POISONS. Zinc and brass. — Establishments making and handling brass come under the Occupational Disease Law, but only a few cases of occupational sickness are reported from them. The typical form of brass poisoning is hardly ever seen by a physician, for it lasts only a short time, the men are familiar with its symptoms, know that it will pass over, and do not send for a doctor. The vapors given off in pouring brass contain sublimed oxide of zinc, and a workman who breathes these fumes may be seized with an attack of what is called brass-founder's ague. It usually comes on some hours after work and consists in a feeling of weakness, languor, loss of appetite, and nausea, a condition much like sea-sickness. Then there is a violent chill lasting about an hour, the throat is parched, there are pains and cramps in the muscles of the legs and a feeling of deathly sickness. The chill is followed by profuse perspiration and relief from pain, but prostration which lasts several hours, and there may be some fever during this stage. The next morning the man may feel weak and have a loathing for food, but he usually reports for work. The same sickness is found among zinc smelters and founders and is known as "smelter shakes." Occasionally cases occur in welding zinc by the oxyacetyline flame. About 70 to 80 per cent of brass and zinc workers are susceptible to this form of poisoning, but it occurs only when the zinc is volatilized by heat. Workers with the solid metals are never affected in this way. What is often reported as brass poisoning * BULLETIN 104, U. S. Bureau of Labor Statistics, pp. 56-64. "BULLETIN 120, U. S. Bureau of Labor Statistics, p. 58. •bulletin 165, U. S. Bureau of Labor Statistics, p. 26. —24 H I 4 370 among brass polishers and buffers is really lead poisoning, for brass, which is an alloy of copper and zinc, often contains a. small proportion of lead. Lead poisoning has increased during the past year in Illinois zinc smelting because of the use of Australian ore which formerly was sent to Germany and which contains 7 or 8 per cent. of lead. The brass industry is not in any country considered as healthful as the average occupation. Hayhurst, who investigated brass founding in Illinois for the Occupational Disease Commission, interviewed 187 brass founders and obtained from 146 a history of illness which he attributed to their occupation. He found only 17 men oyer fifty years of age among 1,761 brass foundrymen in the city of Chicago.'^ Arsenic. — Arsenic is not an important poison in Illinois. There are a few factories manufacturing or handling the insecticides, Paris green and arsenate of lead. Thirteen cases of poisoning from arsenic were reported in 1913-14. Other sources of arsenical poisoning are the trades in which the heavy acids, nitris, muriatic, sulphuric, come in con- tact with iron or zinc, for metal and acid may both contain arsenic as an impurity. For instance, it is well known that lead burners, who use an oxyhydrogen flame may get arsenical poisoning because the hydrogen is produced by the action of muriatic acid on zinc. Makers of toy balloons that are filled with hydrogen may become poisoned in the same way. Antimony. — Antimony is used in type metal up to about 20 per cent, the harder the metal the greater the amount of antimony. The sulphides usually called "sulphurated antimony,^' are used to color rubber a red brown. In neither of these industries is antimonial poison- ing of any consequence. Phosphorus. — The phosphorous poisoning of match makers is now a thing of the past and need not be entered on here. " White phosphorous is used in the manufacture of certain explosives and fire works, but not so far as we know in Illinois. Mercury is used in the form of the nitrate in the manufacture of felt hats, and as a metal in the making of thermometers and vacuum pumps, but these are not important industries in Illinois. Miscellaneous poisonous gases. — Other industrial poisons which, in some states, are the cause of a great deal of sickness, are unimportant in Illinois. These are carbon disulphide, a nerve poison used in curing certain kinds of rubber; carbon tetrachloride, used in the same way; chlorine gas used to make bleaching powder and given off in the course nitric acid manufacture. Nitrous fumes, that great danger in the manu- facture of explosives, are a danger in one smokeless powder plant in Illi- nois and, to a slighter extent, in the plating of metals where nitric acid is used to prepare the metal for platting, and in the making of Prussian blue when, if the mass of blue catches fire, these dangerous fumes are given off. Ammonia gas has caused a number of cases of pneumonia, some of them fatal, when there has been accidental bursting of the pipes in refrigerating plants. ^ Kober and Hanson, Industrial Diseases, Philadelphia, p. 9. 371 Carbon monoxide. — By far the most important gas in industry is carbon monoxide, which causes an increasing number of cases of poisoning every year. This gas is dangerous in very small quanities, for so little as one part in one thousand paj'ts of air will cause disturbing symptoms, while two to three parts constitute a dangerous amount. The Factory Inspection Department of Illinois reports for 1915-16 seventeen severe cases of carbon monoxide poisoning, with seven deaths. An enormous number of workmen are exposed at times to these fumes in the course of their work, for they are given off whenever complete combustion is inter- fered with, or when there is leakage from chimneys, pipes and mains. Cases are reported from the blast furnaces in steel works; from ore smelters ; metallurgical plants ; foundries ; coke by products works ; brick kilns; enamelling furnaces; bakeries; laundries; steam power plants, in fact, any place in which producer gas is used for heat or power. An increasingly large number of cases occurs in the automobile industry, from the testing department, for the exhaust gases from motor cars con- tain a large percentage of carbon monoxide. Leaking gas mains are the cause of poisoning of electrical conduit workers, sewer repair men, and men repairing gas mains. This is acute carbon monoxide poisoning. Usually the man has warning symptoms, pressure and throbbing in the temples, roaring in the ears, a "ca\4ng-in" at the knees, but sometimes he drops unconscious to the ground without any premonitory sj^mptoms. Earely he dies with- out recovering consciousness, usually he comes to, but not completely, and, if he recovers, several days may pass before he is quite normal again. He may escape any lasting injury but a large number of cases of "gas- sing'^ from carbon monoxide, especially during cold weather, develop ' pneumonia shortly after. Another very distressing sequence is mental deterioration, with various nervous disorders. There are a number of cases now on record of carbon monoxide poisoning followed by loss of memory, inability to find one's way about, loss of desire to work and of ability to follow out a mental process. This condition may persist for months, and probably it may be permanent, although most of the cases are still too recent for this point to be determined. Chronic carbon monoxide poisoning is probably much more common than the acute, but is not nearly so well recognized. This is found among people who work in rooms with naked gas jets, unless there is abundant natural ventilation, or a system of exhaust pipes to carry off the gas fumes. Linotypists, electrot3'pers, stereotypers, monotype casters, solderers in Canneries and other places, pressers in tailor shops, men em- ployed in making metal castings, all these may be exposed to slow poison- ing with carbon monoxide if, as is usually the case, heat is supplied by naked gas jets. The symptoms of such poisoning are dullness and lassi- tude, headache, inability to concentrate the mind, loss of appetite, poor nutrition, loss of weight, neurasthenic disorders. The condition under- lying these symptoms is poverty of the blood, a pronounced loss of red blood corpuscles. The amount of ill-health and lessened working capac- ity, and predisposition to infectious diseases that is caused by chronic 372 carbon monoxide poisoning, has never been estimated, but it is probably large. Among the men exposed to carbon monoxide gas in the steel mills the investigators for the Illinois Occupational Disease Commission found a deficient muscular power. The investigators used the hand dynamo- meter and obtained the following results after examining 400 men. They compared Avith the men exposed to carbon monoxide gas another group employed in the same steel works, but not at occupations which exposed them to gas. This table shows the comparison of the muscular strength of the hand of those of the two groups. Ages 20-40. Ages over 40. Workers not exposed to carbon monoxide, average strength. Workers exposed to carbon monoxide, average strength 134. 43 117. 13 113. 01 94.3 The Occupational Disease Commission in its report stated that is is important to determine whether the loss of power noted is due to carbon monoxide. Coal tar products: — Of late years a new class of occupational poisons has appeared in American industry and is taking an important place. These are the coal tar products, benzol, nitrobenzols, toluol, nitrotoluols and a great variety of products derived from these, the most important of which is aniline. These are poisons which act on the blood and the central nervous system, producing alarming symptoms in acute cases, 'vague and not easily recognizable symptoms in chronic cases. None of them so far is of as great importance in Illinois as in some of the other large manufacturing states, but their use is increasing all the time. Ben- zol is largely taking the place of the less harmful petroleum derivatives, gasoline, naphtha, and benzine. It is used in large quantities in rubber manufacture, in one method of sealing cans, in the rubber cement used for making straw hats, in type and roller cleaners, to some extent in dry cleaning establishments. Because benzol is now recovered in coke by- products works a new danger has been added to this particular industry. Aniline is used in compounding rubber, in type and roller cleaners and, in one plant, in the making of aniline dyes. Toluol is recovered from coal tar in gas works. Its most important compound, trinitrotoluol, or T. N. T., is not manufactured in this State. Wood alcohol was first recognized as an important industrial poison in 1906 when, in hearings before the Ways and Means Committee of Congress on removing the revenue tax from denatured alcohol, the hat- workers' union presented affidavits from 75 felt hat makers who had suffered impairment to health or sight from using shellac made with wood alcohol. Since then it has been recognized that wood alcohol may be absorbed through the skin or through breathing fumes, and that it may cause, not only serious gastric and nervous symptoms, but partial or even total blindness. The largest number of severe cases have occurred in the varnishing of the interior of brewery vats. Cases have also oc- 373 curred in many industries where varnish is used or removed. It is also an ingredient of paint removers. It is used by electrotypers and photo- engravers, in dyeing artificial flowers and feathers, in making shoe polish and in manufacturing celluloid and aniline dyes. The Factory In- spectoi*^s report for 1915-16 mentions five cases of wood alcohol poisoning contracted in cabinet finishing and in painting. DISEASES CAUSED BY PHYSICAL AGENTS. This is a very incomplete list of the industrial poisons used in Illi- nois, but it comprises the most important ones. Even if the list were complete and if we were able to say exactly how many workers had suf- fered from each form of poisoning we should have only a small percentage of the sickness in this State that is wholly or partically occupational in character. We should have to add to it the injury to health caused by exposure to excessive heat in foundries, to heat and humidity in bakeries, kitchens, canneries and laundries, and to damp cold in the pickling and salting departments in meat packing plants. Repeated efforts requir- ing over-strain may result in gradual or sudden dilatation of the heart with leaking valves. In the early days of the war the Germans found that the men who developed sudden acute heart failure after forced ex- ertion were chiefly the ones who, in civil life, had done very heavy manual work. Caisson disease is undeniably occupational in origin, for it follows exposure to compressed air. It occurs among divers and men working in construction work under water, where compressed air is used to keep out water and prevent the walls from caving-in. The workman in a caisson experiences little trouble on entering the compartment filled with compressed air or while he is at work there, except possibly pain in his ears from pressure on the drums, but when he returns to the ordinary atmosphere, he runs great risk of trouble unless the transition is made slowly and gradually. The compression has increased the amount of air held in the blood and tissues and when the pressure is removed, gas. mainly nitrogen, is released in the form of bubbles in the blood and tissues, and the mechanical pressure of these bubbles in a delicate tissue like the spinal cord or the retina of the eyes may cause more or less serious injury, even death. Bassoe found 161 men with a history of caisson disease and six deaths which had occurred during 1909 in Illinois. The men were working chiefly in the construction of tunnels for water and freight, constructing sewers, building bridges, and more rarely, laying the foundations of buildings.^ The symptoms of caisson disease usually come on within an hour after returning to the ordinary air. There are severe pains in the legs and lumbar region, known as "the bends '/' more rarely, dizziness known as the "staggers," and sometimes great difficulty in breathing, known as "the chokes." Among the 161 cases examined by Dr. Bassoe were some who had experienced the severe s}Tnptoms years before, but had been left with permanent impairment of health. Three had some form of paralysis, 12 symptoms of disease of the spinal cord, 11 stifl'ness and pain ' Illinois Commission on Occupational Disease, Report, p. 127. 374 in bones and joints, and 65 impaired hearing. Caisson disease is not reportable in Illinois. DUSTY TRADES. ^ It is impossible in the space of this summat^ statement to do more than mention the dusty diseases, pulmonary tuberculosis, fibroid phthisis, and pneumonia. Undoubtedly these are much more numerous than any other class of industrial diseases, but the occupational element, though long recognized by physicians^ is necessarily less clear than in the case of ; those diseases resulting from poisons. What follows is a very brief state- ment of the chief facts concerning sickness in the dusty trades. According to an estimate made by Frederick Hofftnan^ of the Prudental Life Insur- ance Company, it appears that of the 44,130,000 men and women wage-earners in America, 9.06 per cent work under conditions more or less detrimental to health because of the presence in the atmosphere while they are at work of various dusts which predispose to some form of pul- monary disease, or render more serious any disease of the respiratory tract.^ These are the workers exposed to metallic dust, mineral dust, vege- table fibres and dust, animal dust and mixed dusts. The different . varieties differ in their effects, but all produce some effect on the respira- tory tract. If their action is mechanically irritating, tuberculosis or acute pneumonia is likely to result. Such irritating dusts are the metallic dust from knife-grinding and metal polishing; the dust from the harder varieties of stone, especially flint and granite and carbor- undum; sharp bits from straw, jute, burlap^ linen and cotton, fur and hair, and also mixed metal and stone, such as is produced in wet grinding of agricultural implements when the air grows foggy with tiny droplets carr}dng sandstone dust and particles of steel. Another occupation which involves exposure to very injurious dust is sand-blasting metal to prepare it for painting, plating or enamelling. Very firm sand is driven with great force against the metal surface and the particles rebound, filling the air. It is important to remember that the dust that does the real injury must be very fine, for coarser particles do not reach the lungs. If the effect of the dust is only mildly irritating, the tuberculosis rate will not be high, but there may be a very high death rate from pneumonia, and there may be a great deal of asthma. The softer, more easily diffused dust, of which coal dust is the best-known instance, does not directly injure the lungs, but by its pressure it sets up a slow process of hardening in the tissues, a condition known usually as "miner^s con- sumption" or fibroid phthisis. Sometimes a tuberculous infection may develop upon this process, but more often the man dies of a lobar pneu- monia, because the hardening of the tissue has made it impossible for the lung to get rid of the inflammatory process and the pneumonia cannot clear up as it could in a normal lung. If dust is poisonous as well as mechanically irritating, its harm- fulness is g reatly increased. An instance of this combined effect is seen "BULLETIN 231, U. S. Bureau of Labor Statistics, p. 12. 375 in the hatter^s trade. The fine hairs from the rabbits' fur \vhich has been treated with nitrate of mercury render' this trade one of the most un- healthful of modern industries, with a high tuberculosis rate. All lead dust, also, has this double effect, and it is notorious that lead and tubercu- losis go hand in hand.^" « The harmfulness of a dusty trade does not depend on the character of the dust alone ; it depends also on the surroundings of the workers and on their own powers of resistance. A dusty process carried on out of doors is far less harmful than the same sort of work done indoors. This has been recognized by the Granite Cutters' Union, which has insisted on having the mechanical surfacers that grind the surface of the stone moved from the shed to the outside, and by the sandblasters of steel cars at an Illinois plant, who now do all their work in the open air. If the dusty work is cari'ied on indoors the harmfulness is increased by heat and humidity, because these lower the resistance of the worker. The Illinois factory inspectors recognize as dusty trades the follow- ing: metal polishing, coal mining, cigar making, stone cutting, glass manufacture, cement Avorking, the bakers' trade, working in jute flax, textile establishments, porcelain manufacture, polishing mother of pearl. The connection between occupation and disease is still imperfectly L-nderstood, although each year adds to our knowledge of the importance of industrial prosesses and industrial surroundings on the health of the workers. The effects of dangerous work are really now in a fair way to be generally recognized, the effects of ordinary work — such as are pro- duced by faulty lighting, jarring noise, too great humidity, stagnant air, cramped posture, dusts that are almost imperceptible, and other factors which slowly undermine health — these are not yet generally recognized. Et is safe to say that the greater part of industrial sickness, of which in- dustry is either an exciting or a contributary cause is not yet recognized as industrial nor provided for by law. ^" Elnamelling sanitary ware is a striking example. The men scatter a finely grround glaze, containing soluble lead over red hot metal. Sharp dust particles, lead, and excessive heat combine to make a very dangerous industry. 376 SPECIAL REPORT V. HEALTH OF ILLINOIS COAL MINERS. (Abstract of a Report by Emery R. HayJiurst, Ph. D., M. D.) In 1915 only Pennsylvania and West Virginia ranked above Illinois as producers of coal. With 51, or half of the counties contributing, her total production for the fiscal year ending June 30, 1917, was 78,983,527 tons. The total number of persons employed in the mines during the first six months of 1918 was in excess of 90,000. Though certain features of ventilation^ temperature and humidity, and especially explosions and sudden disasters such as asphyxia, in coal mining have been investigated by the United States Bureau of Mines, state mining departments, and associated institutions, comparatively little has been done to ascertain the health hazards of bituminous coal miners. In the survey made by the Illinois Commission on Occupational Diseases in 1910, nystagmus alone was investigated. Because of the importance of the industry in this State and the limited knowledge of the conditions affect- ing the health of those engaged in it, the Commission employed Dr. Emery R. Hayhurst, Ph. D., M. D., Assistant Professor of Hygiene, Ohio State University, to make an investigation of the health of Illinois coal miners. Dt. Hayhurst brought to this research a valuable ex- perience gained in a like invesigation in his own state. Somewhat earlier, in 1913-14, he had investigated industrial health hazards and occupational diseases in Ohio for the State Board of Health, the results of which were published in a well-known report. In his investigation in Illinois, and especially in the survey of housing conditions and local health' administration. Dr. Hayhurst was ably assisted by Mr. Paul L. Skoog, Director of Surveys of the Department of Health of this State. The investigation has, therefore, been a joint one for the Department of Health and the Health Insurance Commission. The extent and nature of the investigation' made are set forth in the following abstract of the report prepared by Dr. Hayhurst. Unfortun- ately, because of the necessity of reducing the size of this volume, the complete report submitted cannot be printed. I. INTRODUCTION. In order to obtain an accurate knowledge of health hazeards, health conditions, and public health administration in coal mining communities, and to find what provision is made for meeting sickness and death, the Health Insurance Commission assigned these subjects for investigation to Mr. Paul L. Skoog, Director of Surv^eys of the State Department of Health, and the writer. By way of preparation for the invesigation 377 conferences were held with some of the operators, with the President of District XII of the United Mine Workers, with the Director and Assist- ant Director of the Department of Mines and Minerals, with Dt. C. St. Clair Drake and Dr. George T. Palmer, Director and Assistant Director, respectively, of the State Department of Health, and with certain other officials and informed persons. The itinerary for the trip of investi- gation included representative centers in each coal district of the State and each of these, mine inspectors, physicians, mine managers and others were interviewed and fifty-six mines w^ere visited and examined. Table I shows at a glance the distribution of the sources of information. TABLE I— SOURCES OF FIELD INFORMATION. District number. Number counties com- prised. Principal city or cities in district. Number of miners (1917). Number cotmties visited. Number mines visited. Number of men at mines visited. Number phys- icians inter- \iewed. I 9 6 7 5 5 4 3 2 4 1 3 2 II Ill IV V VI VII VIII IX X XI XII Total 51 LaSalle Peoria Canton Springfield Danville, Pana Hillsboro, Staunton. Centralia, Edwardsville Belleville DuQuoin Benton Eldorado, Harrisburg.. Marion 7,431 3 7 1,953 3,772 4 6 993 3,524 7,690 6,859 9,001 5,420 1 2 3 2 2 4 5 6 4 6 728 2,042 1,544 1,625 1,813 6,761 1 5 401 5,511 10,511 3 1 3 2 590 1,672 5,007 1 3 721 9,306 1 5 1,727 80,893 24 56 15,809 5 6 2 10 4 5 3 4 2 3 4 5 53 In addition to the above, mortality statistics were compiled from records in the district office of the United Mine Workers, and the status of sickness and death benefit associations was obtained from a question- naire sent out by the Commission to the various local unions as well as by field inquiry. The selection of mines was made so as to include mines of large, medium and small production and those adjudged by inspectors or others to be good, fair and bad in respect to working conditions. Furthermore, the investigation covered typical examples of housing conditions and included a study of the various methods used in mining communities to cope with sickness and death. The investigators traveled by automobile for a four weeks' period during July and August, 1918, thei itinerary covering 24 principal coal mining counties in which 54 cities and towns were visited. • The vast majority of Illinois coal miners (96.09 per cent) in 1917 worked in the 324 shipping or commercial mines, leaving 3.91 per cent who worked in the 486 small mines or those supplying the local trade. The chief coal-producing counties are, in descending order: Franklin, Williamson, and Saline (southern) ; Sangamon, McCoupin, Madison and St. Clair (central and western) ; LaSalle, Bureau, Fulton, and Peoria (northern) ; and Vermilion (eastern). 378 II. WORKING CONDITIONS AND HEALTH. The discussion of working conditions and health must be introduced by a few more or less technical details, and few data relating to the race and age of miners. The shaft type of mim and room-and-pillar style of development are the principal forms of mines in Illinois. Long-wall mining, in which ventilation is a little easier to maintain, characterizes three or four of the northern counties. Illinois is considered a localty of deep mining. Mines in general vary in depth from those upon the surface which are simplv stripped, to 700 feet, but one mine, at Assumption, is 1,004 feet deep. " All geological seams from Nos. 1 to 7 are worked, the principal ones being Nos. 6, 5, and 2 (the deepest known seam is designated "No. 1''). The distance to the working face in older mines runs as high- as three miles from the foot of the hoisting shaft. The power used for hoisting is usuallj^ steam, but some large mines are electrically equipped while smaller ones, particularly drifts, use animal or man power. Haul- age in mines is principally by electric motors with mules for terminal work. The barns needed may be located above or below ground. Min- ing machines undercut about two-thirds of the coal produced, the balance being mined by hand. There are a trifle over six times (24,951) as many "miners" (working by hand), exclusive of loaders (24,529), as there ^ are men mining coal with machines (3,957). Machine mining has not come into vogue so much in Illinois as in Ohio and elsewhere. The chief Hasting substance used is black powder, ranging in sizes from 26/64ths (CC) to 9/64ths (FF). In the southern counties "per- missible explosive" is used extensively while in the long-wall mines of the north, where the shooting down of a rocky roof is necessary, much dynimite is used. The State law requires that the blasting of coal be done outside of working hours, and, in mines of a stated size, specially trained men, called "shot-firers," perform this duty. With the ex- ception of mines under 100 feet or so in depth Illinois mines are classed as dry mines. They are dryer in the winter than in the summer, and sprinkling of roadways is a common procedure to prevent the explosion of dust. The chief mine gases are of three types: fire damp (methane, CH4) which is explosive but not dangerous to health; black damp (where car- bon dioxide and nitrogen are increased at the expense of oxygen) ; and white damp (carbon monoxide). The first two "damps" occur naturally in mines, and artificial ventilation, which is promoted as a rule by means of large blow fans, is necessary to keep these gases sufficiently diluted to prevent explosions and to supply enough oxygen to the workmen for breathing purposes and for the burning of lamps. The State mining laws are very specific with reference to this artificial ventilation of mines and through the inspection system and the employment of mine examiners by the opei-ators, a high degree of success in ventilation is usually obtained. The mines of the southern part of the State tend to produce fire damp and many explosions occur, but, on the whole, mining men state that Illinois mines are not classed as particularly "gassy" (meaning fire- 379 damp) . Unlike many British mines there is not one in Illinois in which safety lamps have to be used exclusively. White damp occurs in mines in connection with fires and explosions and the blasting of powder when the air supply is insufficient. It is always the result of incomplete com- bustion. It is the dangerous component of "after damp" which occurs after fires, etc., and which has rather more effect on canaries or mice than upon men so that the former have been used as test animals. The col- lections of this gas are insidious and the miner has no ready means of detecting it. "Feeders" or "blowers" of illuminating gas, such as used for domestic purposes, are little known in Illinois. Gasoline locomotives, from which the dangerous exhaust fumes characteristic of gasoline motors occur, are used in less than ton mines in the State and apparently these are gradually being replaced with devices less dangerous to the atmosphere. Miners usually work two in a room, or at least in pairs, in two or more rooms, and an especial feature of ventilation is to split the air cur- rents entering the mine so as to pass fresh air in a method of even dis- tribution to these work rooms. The law requires that no men be allowed to work in rooms or advancing entries more than 60 feet "ahead of the air," which means the distance from a definite air current of given volume. An effort is made to keep this air current equal to 100 cubic feet per man per minute with a 50 per cent increase in gassy mines and a 500 per cent increase for each animal. The temperature of mines is fairly constant. Shallow or wet mines with a temperature ranging between 50 and 60 degrees at the working face are the coolest. Mines from 300 to 600 feet deep have tempera- tures ranging from 60 to 70 degrees, those from 600 to 1,000, tempera- tures ranging from 70 to 80 degrees. Slight seasonal variations occur. The air always increases in temperature on its passage through the mine. The humidity of mine air is invariably high since even air carrying minimum amounts of water vapor into the mine, as in the winter time, still leaves the mine nearly saturated, for it absorbs moisture out of the coal and strata. "The humidity of return air in Illinois mines through- out the year averages 96 per cent and the temperature averages 65 degrees F. The average humidity of the outside air in Illinois is 72 per cent and the average temperature 52 degrees." Hence, the physical con- dition of mine air, with the exception of dust, is ideal for work. The chemical condition is rendered so through close obedience to the mine laws on ventilation. Dust is the chief bane of coal mine air for the vast majority of miners, and, speaking from a health point of view, the health hazard is in proportion to its composition as it varies from coal to granite dust. The mine inspection system of the State is concerned chiefly with the prevention of accidents, especially explosions, fires, asphyxiations, and the collection of statistics. For the purpose, the State is divided into twelve districts beginning with jSTo. I at the north and ending with No. XII at the south, with a full time inspector in charge of each, and with an inspector in each county to assist him. Each mine also has one or more mine examiners. This supervision redounds as much to the 380 general health as to the prevention of the disasters mentioned, since ade- quate ventilation is an important object of the inspection system. Practically all mines are infested with rats or mice, and sometimes both, but in the absence of epidemics, such as plague, they have little significance as a health hazard to miners. Gnats or small flies are also found, but they are few in number and consequently of small menace in the mines. In the absence of sanitary privies on the surface the carry- ing of disease from excrement to food and to houses by these agents con- stitutes a considerable menace. The eight-hour day obtains in the mines, although some "company men" may work as long as ten hours. Overtime is very infrequent, and night work is limited to some of the big mines. Absenteeism averages about 10 per cent per day and this percentage is about doubled for a day or two following payday, which occurs twice a month. Injuries cause about 2 per cent of total absences. The lubor-turn-over is much more pronounced in large mines and mining centers^ and amounts to from 2 to 30 per cent per month. In the northern and west central coal districts Italians predominate, while Eastern Europeans, principally Austrians, Poles and Slavs, form 25 to 75 per cent of employees in the other districts. Colored employees are found in a few northern and central mines and constitute as high as 75 per cent in a couple of large mines in the southern part of the State. An inquir}^ into the ages of 13,889 employees (top and bottom) at 49 mines visited showed 2.6 per cent over 70 years of age; 3.5 per cent between 60 and 69; 86.6 per cent between 22 and 59; and 7.3 per cent between 16 and 21. Wages are good and with the present steady work the pay envelope is large; jiist now poverty and pauperism are practically unknown. In previous years, however, many mines were shut down for some months each year . As a consequence investigators for the "Springfield Survey" in 1915 found that many mining families had great difficulty in making ends meet throughout the year. Health hazards vary from one occupation to another. The occu- pational distribution of the 78,056 coal mine employees reported in 1917, was as follows : Cagers 753 Shot-firers 546 Drivers 4,263 Timbermen . 1,422 Laborers 5,660 Trackmen 2,178 Loaders 24,529 Trappers 1,251 Machine men " 3,957 TJn-classified . 8,546 Miners 24,951 ^ The surf. ice workers, including trackmen and some of the unclassi- fied above, totaled 7,'.J07. Investigation showed the health hazards for each of the above classes to be as follows: Cagers. — Cagers breathe the air after it has made the complete circuit of the mine (provided the return air is by way of the hoisting shaft, which is usually the case). A brisk air movement is also present. 381 Fine dust, gasoline motor fumes (when such motors are used,) and get- ting wet with water drippings, are other features. Drivers. — The drivers,including motormen, trip-riders and mule drivers, are usually youths. The work is dusty, in strong drafts, and hazards exist in connection with motor (fumes or electric flashes). Laborers. — These are scattered about the mme and have the hazards of the places in which they happen to work. Loaders. — These workmen are subjected to air conditions of the distant interior (work rooms), and to immense amounts of dust. Their work is laborious, ' on the tonnage basis, and when slack periods occur they are apt to sit around in cool, damp places. Machine men. — These men have the ventilation hazards of the work rooms, and are the most subject of all workers .to breathing fine dust (bug dust). Most of the work is laborious and much is done in awk- ward positions. Miners. — The work of the miner is much less difficult than before the days of the extensive use of powder. They have the ventilation hazards of the work room. The dust hazard is great. Their work is laborious, on the tonnage basis, and rather monotonous with consider- able jar, much spurt work interspaced with spells of waiting for mine cars, when they are apt to sit around in cool atmospheres and damp places. Shot-firers. — Their chief hazards are the breathing of dust and oftentimes white damp after shooting. Timber men. — These men have the "ventilation hazards of work rooms and entries, more or less dust, also in many mines more or less wet work. Trappers. — Much of the trappers' time is spent in waiting at the doors, which they watch, or the switches. They may be in strong drafts carrying various amounts of dust. They are usually youths, but some- times old men. Tipple men. — These workers at the surface of the coal mine have the hazards of weather exposure, but, more especially, the breathing of a great deal of coal dust; occasionally, also, smoke and fumes from the burning dump piles where these exist. The weighmen are usually in enclosed quarters. Track men. — Are exposed »to the weather, and the breathing of a great deal of coal dust. Hoisting engineers. — These men are apt to be exposed to excessive temperatures (often 100° to 140° F.) where steam hoists are used. This is a dangerous feature since they must be constantly on the alert, as with their levers they guide the raising and lowering of cages by means of signals from bells or whistles. Coal washers. — In the case of these men we find weather exposure with wet work and a great deal of dust from the crushing processes. Noise is a marked feature. Child labor. — Is practically no feature in Illinois mines for youths under sixteen are prohibited by law from entering a mine. One hazard 382 is that youths begin work in mines without preliminary physical examin- ation to determine whether they are fit for such work. Stripping mines. — The chief health hazards are weather exposure, particularly heat in the summer time while working in low places. Also men in steam shovels are considerably exposed to heat from furnaces. Some Special Hazaeds need discussion. These appertain to the work of most miners. Illumination. — Illumination is no longer a hazard for miners since much of the bottom is supplied with electric lights (207 mines in 1915) and miners use the modem carbide lamps. Oil lamps have all but dis- appeared. Safety lamps, with their imperfect illumination, are fortun- ately not required in Illinois mines. Heat. — Illinois miners, with few exceptions, are not exposed to high working temperatures. Seventj^-eight degrees was the highest noted underground, which was at the upcast in the deepest mine (1,004 feet). Hoisting engineers may have undue exposures-. Cold. — The temperature of Illinois mines is invigorating — most so in the shallow, cool mines. As long as workers keep active, the low tem- peratures, unless combined with work in mud and water are no hazard. Fatigue. — Faulty postures and work of jarring, vibrative character, heavy lifting at times, and a certain percentage of men ill-fitted physically for the work are the chief hazards. Honrs of loorTc. — The eight-hour day, with very little overtime, obtains at mines. Some company men (laborers) work ten hours. Infections. — The disposals of stools in the gob, as is the prevailing method, can be made safe. Illinois mines are too dry to afford much hazard in the spread of hookworm disease. The extent to which coal mine dust may transport virulent germs, as from spitting, has not been investigated; the hazard is probably insignificicant. Diseases from animals, such as anthrax, glanders and lockjaw, do not appear to exist. In the presence of the black plague the rats and mice in mines would be a great menace. Injuries which miners receive are, (if not more free), at least as free from secondary infections as in most kinds of work. Electricity. — In addition to burns and shocks, and occasionally electrocutions, the witnessing of brilliant electric flashes, occasions some electrica ophthalmia — a painful swelling of the eyes which may persist up to fourteen days. Poisons. — These concern mine gases principally {q. v.) Occasion- ally sulphurous waters cause dangerous inflammation of the eyes when they gain access to them. Assuaging of thirst. — Questionable water supplies in many instances lay miners liable to typhoid fever, dysentry, and water borne diseases. Alcholic beverages are not permitted while at work. Personal hygiene.— Miners are in great need of instruction in matters of personal hygiene and the prevention of sickness. A large number of miners' illnesses could be avoided by this means. 383 Geneeal Sanitary Conveniences at mines may be summarized under a few headings as follows: Wash houses. — Practically all mines have wash-houses located near the entrance to the mine. This is required by law. A majority of them are not of sufficient capacity and also are not separated from clothes- drying quarters, which should be the case. Most have shower baths; many have simply pans, buckets or tubs, especially where water is scarce. Complaints of insufficient heating of bath-houses are frequent. They are also often poorly ventilated. Drainage from them is frequently dangerous to water supplies. Their use has greatly increased so that at present upwards of 70 to 95 per cent of the employees use them. By tradition, miners bathe completely every day where opportunity is offered. In the past this was done at the home. Wash-house quarters are supplied and maintained by the operators. The employees furnish soap, towels and locks. Clothing provisions. — A place to hang clothes is provided at prac- tically all mines. In the vast majority of cases this provision is in the wash-house. Lockers were found about as often as ceiling hooks or hangers upon w^hich the clothes are hung and pulled up to the ceiling by means of a rope and pulley. Many mines have neither, in which case the men use nails or pegs along the walls of the wash room. Too great crowding was frequently noticed. Lack of screens against flies wa^ common. The ideal arrangement is a room partitioned off from washing quarters, equipped with ceiling hooks for work clothes and lockers for street clothes. Water supplies. — Water for drinking purposes is usually not ob- tained at the mine, but is brought by the employees in their lunch buckets. Wells in the neighborhood of the mines, oftentimes in very poor sanitary condition, are the usual sources of water for drinking pur- poses. In many districts the prevailing type of well is boxed around at the top and left open, with a rope and bucket for drawing water. Un- doubtedly much typhoid fever and dysentery in mine districts are due to lack of attention to the source of drinking water supplies. Scarcity of water is serious in some districts. Hydrochloride disinfection could be provided at small expense at every mine. Sewage disposal. — Mines do not have toilet facilities below ground. The men at work simply use the gob piles. In dry mines there is little hazard from this practice, provided care is taken by each miner to cover his stool. In many mines portable trench buckets, or closets mounted on trucks, could be used. At the surface, where from a few to fifty men are employed, the vast majority of mines provide nothing in the way of a latrine, much less a sanitary one, for the workmen. Instead, the latter usually seek the neighboring dirt piles, fields, timber or hillsides. On account of this lack the flies and insects about mines and mining towns are special menaces as disease carriers. A standard privy for the surface workers at a mine could be constructed at very little cost. Lunch provisions. — Each employee at a coal mine invarably carries his own lunch in a specially constructed miner^s lunch bucket, which is provided with a water compartment. The 30-minute lunch hour pre- 384 vails. Occasionally workmen at the surface may have opportunity to lunch at home. III. HOUSING CONDITIONS AND LOCAL HEALTH ADMINISTRATION. The community has a large place in determining the diseases of miners. Very often the chief afflictions are favored by unsanitary housing conditions, unsafe water supplies, poor sewage disposal, poor food supervision and weak local health administration. The hygiene aud sanitation of dwelling places is important since it involves about one-third of the normal day for the worker and most of the time for his family. While some Illinois mines, as, for instance, those at Springfield, Belleville, and about Peoria and La Salle, are lo- cated in or close to large cities, as a rule mining towns are composed of a store or two around which very plain frame dwellings or shanty houses group themselves. While one or two communities, as the one at Divernon, are found model in regard to building construction and ar- rangement, and upkeep, and while the men in a few other communities are not poorly housed, the great majority of the mining centers present a housing problem. Moreover, safe sanitary standards as regards both water supplies and sewage disposal were nowhere encountered. The typical mining town consists of rows of dingy houses, all built after one or two patterns, often located on hillsides, with rows of privies located close to wells or draining toward the wells on the next street. Often small ditches of water act as open sewers, and seldom is any provision made for the disposal of garbage. Screens for houses are usually pro- vided by the occupant if present at all. Many mining towns are unincorporated. Often there is no local health officer. The board of health consists of the mayor and two or more members of the council in the larger towns. In many cases, only the township supervisor arrangement prevails. Very often the health officer is not a physician and is entirely unskilled in matters of hygiene and sanitation. Very often he belongs to the old type of health officer, who lays stress on rubbage, ash-dumps, foul smells, and fumigation, but pays little attention to wells, privies, screening, milk supply, or the prompt isolation and concurrent disinfection of a case of communicable disease. To the above notes, a few excerpts from a report by Mr. Skoog may be added. "The drainage from the mines was found to be rather unsatisfactory m most cases. Open ditches were generally used for the removal of w^te water. Where creeks were in close proximity to the mine, the effluent was directed to them. In many cases manure was found in large quantities near the shaft and flies were noticeable in large quantities. In very few cases were sanitary flush toilets found on the surface at the mines. "The public health protection as afforded in 98 per cent of the towns visited was found to be very unsatisfactory. The methods of handling communicable diseases is old and not in accord with modern 385 methods. In some communities persons quarantined were required to pay for fumigation and in other communities the health officer or under- taker did this at a cost to the town of $5 for fumigation. "A large per cent of the towns visited were without sewers and con- sequently privies were the common method of excreta disposal. Shallow wells were also in use. "The housing conditions vary. In Divernon, for exampe, the coal company has constructed 100 four-room bungalows. The style of archi- tecture varies and there is not the monotony usually found. The sur- roundings are comparatively clean and attractive. In most other com- munities the houses are poorly cared for. The general sanitary con- ditions were found to be unsatisfactory. "Generally speaking, the living conditions in coal mining communi- ties are poor and unattractive. The working conditions of the miners are much better than the living conditions." IV. SICKNESS TYPES AND EXTENT. There are two methods of inquiry into types and extent of sickness : first, statistics, and second, opinions of persons qualified, through- ex- perience or practice, to impart information. Practically no statistics are available concerning sickness among Illinois coal miners. Unfortunately, the bookkeeping of vital statistics has not extended this far. Some of the local unions and benevolent associations can supply certain limited statistics but these are too local to warrant drawing conclusions therefrom. The exoneration (the non- dues-paying) lists of the State organization (U. M. W. A.) do not separ- ate sickness from other causes of the members not being at work. Hos- pital statistics in mining districts are not representative, however complete they may be, since an unknown percentage of miners go to hospitals when sick. No insurance companies have to date taken out group policies covering sickness, among other disabilities, among miners. Under the circumstances we must rely chiefly on physicians in mining centers for the information desired. The experience of physi- cians, scattered throughout the district, particularly where they agree quite unanimously, are probably more likely to be a close analysis of the sickness situation than any conculsions which might be drawn from statistics. The following is a summary of statements entered on the questionnaire by which physicians were personally interviewed in min- ing communities: (a) Disease rarely found among miners. — Certain diseases reputed to be prevalent among miners elsewhere or to be suspected, were found to be practically absent among Illinois miners. These are lockjaw, anthrax, glanders, hookworm, rat-bite disease, and nystagmus. (b) Disease found less frequently than usual. — Pneumonia (except among Xegro miners where it seems to be more prevalent) ; tuberculosis (that which occurs is generally of a very slow progressive type, difficult to separate from miner's asthma) ; and venereal diseases. However, it must be noted that according to death certificates filed by coal miners —25 HI 386 in the State, pneumonia exceeds the prevailing percentage for this dis- ease in the populace while tuberculosis approximates it. This is greatly emphasized if the deaths from violence are excluded. (c) Diseases having the usual frequency. — Acute rheumatic fever; afflictions of the upper respiratory tract, such as colds, tonsilitis, middle ear diseases, nose, throat and sinus affections, acute broncnitis, eye afflict- ions, although the communicable disease, trachoma, or granulated eye- lids, was frequent in some localities; skin affections; foot affections; deformities; nervous affections; hernias; varicose veins; other chronic diseases in general ; malaria ; epidemic diseases such as influenza, small- pox and summer diarrhoea. (d) Diseases with occupational earmarh. — These are "rheumatism," asthmatic afflictions, and afflictions due to alcoholic beverages. The "rheumatism" is of the type unassociated with, fever, called musculo- articular, of which lumbago is the chief form, and so-called "sciatica" the next. Exposure to cool damp atmospheres, drafts, the weather, and sudden straining efforts on the part of men not physically adapted to their work, are underlying causes. Asthma is a disease decreasing in frequency. Bad ventilation including dust probably still plays the chief part in its cause, but organic heart disease or other chronic dis- eases are becoming principal reasons for what asthma is found. Asthma is rarely found in individuals under forty years of age. About one or two working men in a hundred are reported as asthmatics. Alcoholism is exceedingly common, perhaps more so than in other industries, since it seems to be traditional among a considerable number of miners to take a day or so off after each pay-day for an alcoholic debauch. Other afflictions are dust plugs in the ears (of no consequence but causing some temporary deafness) ; eyes flashed by electric short circuits ; "sul- phur" ulcers due to getting sulphurous waters in the eyes ; callosites on knees and sometimes elbows, hands and shoulders, mostly in "low coal" districts; "gassing^' due principally to accidental breathing of white damp after blasting, fires or explosions; and premature aging — though this not in a marked degree. General summary of diseases. — There is no reason for believing that the usual afflictions, outside of the respiratory system and the mus- culo-osseous system, are more frequent among miners than among other employees. In fact, they are, as a class, probably healthier than the average type of factory worker. Top workers, exposed to the weather, are said to have more sickness than those in the mine. Alcoholism is far and away the chief bane. It is said, however, to be decreasing — a fact explained by one physician as due to education, increasing cost of alco- holic drinks, their present bad quality, and the extension of prohibition. Of the respiratory afflictions, chronic bronchitis associated with asthmatic symptoms, and often complicated by a chronic form of tuberculosis, are undoubtedly more prevalent than among agriculturists. Some comment was made on the number of draftees returned to coal mining counties, but inquiry at the State Department of Health showed that most of these, curiously enough, were agriculturists rather than miners. The num- bers, however, were too few to warrant deductions. Hospital experience, 387 as at the West Frankfort Miners' Hospital, showed that the principal medical afflictions for which the miners came into the hospital were typhoid fever, malaria, pneumonia, tuberculosis and rheumatism. At the company hospital at Zeigler the physician in charge listed as most prevalent chronic bronchitis with emphysema and asthma, some acute iheumatic fever, sacro-iliac affections, acute bronchitis, ear plugs, and nasal sinus afflictions, with typhoid epidemics at times and trachoma fairly common. There had been but one case of lockjaw in six years experience, in spite of the fact that anti-tetanic serum was only rarely administered. "Flashed eyes" were fairly common; malaria frequent. In this place no case of hookwomi was ever discovered in a miner. V. MORTALITY. Illinois leads all other states in having available (through the efforts of the United Mine Workers in the State) figures on the average number of employees at a given time in the soft coal industry and a record of each coal miner's death for the past ten years. These records have resulted from the insurance maintained by the organization by which the sum of $250 is paid to the beneficiary on the occasion of the death of any miner in good standing. In order that former or un- employed miners may remain in good standing and thus insure the burial payment an "exoneration" (non-dues-paying) list is maintained to which 7 per cent of the total number of miners now belong. The exoneration list has recently been extended from 5 per cent of the total membership to 7 per cent, because of the exonerations allowed for War Service. These records have enabled the Commission and the writer to com- pile the fallowing Tables (II, III, IV, V, VI) : TABLE II — MORTALITY AMONG ILLINOIS COAL MINERS. (February 1, 1912, to July 21, 1918.) Fiscal year. Number of deaths. Average yearly member- ship. Deaths per annum per 100,000 employed. Feb. 1, 1912-1913 Feb. 1, 1913-1914 Feb. 1, 1914-1915 Feb. 1, 1915-1916 Feb. 1, 191&-1917 Feb. 1, 1917-Jan. 1, 1918 Jan. 1, 191S-July 1, 1918 742 73, 955 800 75, 161 825 76,093 784 70,903 832 74, 942 893 83,489 555 93,651 1,003 1,064 1,071 1,105 1,110 1,167 1,185 The last column in Table II shows the death rate for Illinois coal miners has been constantly increasing since 1912. 388 TABLE III— MORTALITY OF ILLINOIS COAL MINERS BY SELECTED CAUSES OF DEATH. (FEBRUARr 1, 1912, TO JuLY 21, 1918, Approximating 6^ Years.) Cause of death'. International list No. (s). For the four year genod . 1, 1912, to Jan. 31, 1916.* For the geriod . 1, 1916, to July 21, 1918.t Total number of deaths Feb. 1, 1912, to July 21, 1918. Percentage distribution of deaths, per cent. Deaths per annum per 100,000 employed. t Typhoid fever Malaria Tetanus Tuberculosis Cancer Cerebro-spinal diseases . Circulatory diseases Pneumonia Other respiratory dis- eases Liver cirrhosis . Geiiito-uriiiary venereal) Suicide Violence** All others (non- Total. 1 4,4a 24 28 to 35... 39 to 46.. 60 to 79.. 77 to 85... 91 and 92. 86 to 90 93 to 98 113,113a , 119 to 127.. 155 to 163.. 164 to 186.. All others . 104 6 5 277 109 153 212 252 158 47 124 102 1,205 408 3,162 50 5 1 221 98 135 .190 239 55 41 129 58 790 254 2,266 154 11 6 498 207 288 402 491 213 88 253 160 1,995 662 5,428 2.8 0.2 0.1 9.2 3.8 5.3 7.4 9.1 3.9 1.6 4.7 3.0 36.8 12.2 100.1 30.8 2.2 1.2 99.4 41.4 57.5 80.3 98.1 42.6 17.6 50.5 31.9 398.2 132.1 1,083.9 * From figures compiled by Duncan McDonald, former Secretary-Treasurer, U. M. W. A., District of Illinois. t From death claim records at office of Walter Nesbit, Secretary-Treasurer, U. M. W. A., compiled by the Commission. t The average monthly number of employees throughout the whole period of approximately six and one-half years was 77,051. ** "Violence" includes all external causes other than suicide. Some deductions based on Table III may be made by comparisons with "percentage distribution of deaths" in other groups, which have been computed elsewhere, as: (a) The United States Eegistration Area for 5,663 "miners and quarrymen'' as given in Mortality Statistics, United States Bureau of Census, 1909, Table VIII, pages 402-403 (see Tables IV and V below) ; and (b) The United States Eegistration Area for 210, 507 "occupied males 10 years of age and over" as given in Mortality Statistics, United States Bureau of Census, 1909, Table VIII, pages 388-389 (see Tables IV and V below). ^ 389 TABLE IV- -PERCENTAGE RATES OF CERTAIN CAUSES OF DEATH FOR ILLINOIS COAL MINERS AND OTHER GROUPS. Causes of deaths.* 5,428 deaths among lUinois coal miners, 1912-1918— per cent. 5,663 deaths among miners and quarry- men, U. S. Reg. Area, 1909— per cent. 210.507 deaths among occupied males, U. S. Reg. Area, 1909— per cent. Typhoid fever Tuberculosis Cancer Cerebro-spinal Circulatory disease Pneumonia Other respiratory diseases Liver cirrhosis Genito-urinary (non-venereal) .Suicide Violencef 2.8 9.2 3.8 5.3 7.4 9.1 3.9 1.6 4.7 3.0 36.8 2.3 t8.8 3.3 4.9 8.8 8.2 4.3 1.0 4.0 1.5 39.1 2.2 tu.s 5.5 9.8 16.1 8.0 10.2 1.8 **8.5 2.6 10.6 * See Table III for corresponding International List Numbers, t See Note 4, Table III. t Tuberculosis of lungs, only. ** Bright's disease. While it is true that comparisons as arranged in Table TV are not quite logical, principally because periods of even date are not compared, but also because soft coal miners have not been separated out, they are the best that can be had at present. Violence as a cause of death of Illinois coal miners ranks 2.3 points less than that of "miners and quarrymen^' in the Registration Area. This cause, however, for both Illinois coal miners and "miners and quarrymen" is greatly in excess of the violence percentage in "occupied males" in the Registration Area (10.6 per cent of all deaths). But one other occupation, "Steam railway employees," with 53.6 per cent of all deaths due to violence, surpasses "miners and quarrymen." The occupation ranking next is "lumbermen and raftsmen" with 29.9 per cent (United States Mortality Statistics, 1909, Table VIII). The marked excess in this cause of death nullifies to a large extent any com- parisons possible between the other causes of death and the figures given under "occupied males" in the last column. It does not however affect comparisons between "Illinois coal miners" and "miners and quarrymen." By eliminating the distortion due to violence as a cause of death and then comparing the purely medical causes (plus suicide) a clearer insight is obtained of the relative importance of certain prominent death causes. 390 TABLE V— PERCENTAGE RATES OF CERTAIN CAUSES OP DEATH FOR ILLINOIS COAL MINERS AND OTHER GROUPS, VIOLENCE EXCLUDED. Causes of deaths. 5,428 deaths among Illinois coal miners, 1912-1918— per cent. 5,663 deaths among miners and quarry- men, U. S. Reg. Area, 1909— per cent. 210,507 deaths among occupied males, U. S. Reg. Area, 1909— Ijer cent. -.4 4 Typhoid fever Tuoerculosis Cancer Cerebro-spinal Circulatory diseases Pneumo lia Other resoiratory diseases Liver cirrnosis Ge 1 to-urinary (non-ver ereal) Suicide 4.4 14.6 6.0 8.4 11.7 14.4 6.2 2.5 7.4 4.7 3.8 *14.4 5.4 8.0 14.5 13.5 7.1 1.6 6.6 2.5 I 2.5 *16.6 6.2 11.0 18.0 8.9 11.4 2.0 t9.5 2.9 • Tuberculosis of lungs, only, t Bright's disease. As compared with "miners and quarr}^men" in general, Illinois coal miners rank ( 1 ) about the same with respect to tuberculosis and cerebro- spinal diseases; (2) more favorable with respect to circulatory diseases; and "other'' respiratory diseases ; and ( 3 ) less favorable with respect to typhoid fever, urinary (non-venereal) diseases and suicide. As com- paied with "occupied males/' in general, Illinois coal miners rank (1) about the same with respect to cancer and liver cirrhosis; (2) more favoiable with respect to tuberculosis (which is more pronounced when total tuberculosis is considered), cerebro-spinal diseases circulatory dis- eases, "other" respiratory diseases, and genito-urinary (non- venereal) diseases; and (3) much less favorable with respect to typhoid fever, pneumonia and suicide. Unfortunately, similar, more recent figures have not been compiled by the Census Bureau, nor does this agency compute "death rates" among employed persons. Mortality statistics for soft coal miners or groups with similar hazards in other states have not been prepared. Table VI, however, permits some conclusions to be drawn from the "death rates" ascertained. 391 TABLE VI — MORTALITY OF ILLINOIS COAL MINERS BY CAUSES AND AGE-GROUPS. (July 22, 1916, to July 21, 1918.) r Age groups. Causes of death.* 15-24 25-34 35-44 45-54 55-64 65 or over. Age not given. Total. is? B * 3 * a o Ph a 3 +- c o o Ph ©gTS 1/1 P? Tuberculosis . 26 14.6 47 7 9 17 36 6 2 9 26.4 9.2 7.6 11.2 18.1 3.3 5.4 8.8 35 15 24 18 39 4 9 11 19.6 9.7 20.5 11.9 19.6 8.8 24.3 10.7 33 20 25 36 49 11 8 19 18.6 26.3 2L3 23.8 24.7 24.4 21.6 18.6 24 22 27 38 38 7 12 38 13.4 28.9 23.0 25.1 19.1 15.5 32.4 37.2 13 12 22 36 26 16 3 22 7.3 15.7 18.8 23.8 13.1 35.5 8.1 2L5 178 76 117 151 198 45 37 102 49 676 260 9.4 4.0 6.1 7.9 10.4 2.3 1.9 5.3 2.5 35.7 13.7 106.5 Cancer 45.4 Cerebro-spinal dis- eases 9 6 10 1 3 2 7.6 3.9 5.0 2.2 8.1 1.9 1 0.9 70.0 Circulatory diseases 90.3 Pneumonia . 118.5 Other respiratory diseases 26.9 Liver cirrhosis. . . . 22.1 Genito-urinary non-venereal Suicide 1.0 61.0 29.3 Violencef 404.6 All others 41 15.7 55 21.1 44 16.7 141 15.7 32 12.3 42 16.1 5 1.9 155.6 Total 1,889 99.2 1,130.2 * See Table III for corresponding International List Numbers t See Note 4, Table III. J The averag-e monthly employment vv^as 83,537 men. ** % here means the distribution of deaths by age-groups, per 100 deaths from the given cause. ft % here means the distribution of deaths by causes, per 100 deaths. Table VI is valuable in two ways : ( 1 ) It shows the age-groups in wliich certain diseases are emphasized in Illinois coal miners, and (2) when related lo Table III, it indicates the increasing or decreasing im- portance of certain diseases as causes of death. (1) Tuberculosis shows its main emphasis in the age-group 25 to 34, with a gradual decline thereafter throughout the balance of the age- periods. Pneumonia shows a gradual increase with age up to the age-period 45-54, then a gradual decline. The figures for other respiratory diseases are too small for de- ductions, but in general show most emphasis later in life. Cancer and cerebro-spinal diseases both show a marked incraese in the age-period 35 to 44, then a more gradual increase to age 64, after which there is a decline. Circulatory diseases are emphasized from 45 years of age up. For Liver cirrhosis the figures are too limited for speculation al- though the majority of deaths occur in the age-periods between 35 and 64. The non-venereal genito-urinary afflictions (principally Bright' s disease) show a gradual increase by age-period up to and including the age-period 55-64. ^^^^^^I^^P 392 ^l^^^^^^^^^^^l ^^Tke figures for mioide and violence were not obtained by age^ periods. i . xi. All other diseases have a very even distribution throughout the age- periods, there being emphasis on the period 25-34 and less emphasis m the period 55-64. (2) Comparing the last column in Table VI which shows death rates by cause for the years 1916-1918 with the last column in Table III, which shows death rates by cause for the years 1912-1918, it is found that the rates per 100,000 employed have increased for the following afflictions: tuberculosis (from 99.4 to 106.5), cancer (from 41.4 to 45.4), cerebro-spinal diseases (from 57.5 to 70.0), circulatory diseases (from 80.3 to 90.3, pneumonia (from 98.1 to 118.5), liver cirrhosis (from 17.6 to 22.1), and genito-urinar}^ (non-venereal) diseases (from 50.5 to 61.0). Deaths from the folowing causes show decreasing rates: other respiratory diseases (from 42.6 to 26.9), and suicide (from 31.9 to 29.3). Violence (increasing from 398.2 to 404.6) did not change substantially. The 1889 deaths occurring in the two-year period, July 22, 1916 to July 21, 1918 (see Table VI) were classified also by the twelve dis- tricts composing the coal field of the State. Without exhibiting the table, the following could be deduced: (a) The total of 5 deaths from malaria all occurred in the last four (southern) districts. .(b) The total of 42 deaths from typhoid fever were distributed, 12 in Franklin county, 9 in Williamson and Johnson counties, (these two constitute a district) , and the balance scattered. (c) All the remaining causes of death were fairly evenly distributed in proportion to the number of employees in the several districts. Summary of mortality statistics. — The annual death rate of Illinois coal miners has been increasing since 1912. Death rate comparisons with exactly like groups elsewhere cannot be made because similar statistics elsewhere have not been compiled. The per cent of deaths from different causes shows that rates for Illinois miners are about the same as for "miners and quarrymen" in the Eegistration Area, 1909, and that for this class of employees, external causes (violence and suicide) account for two-fifths of the deaths. When violence is excluded typhoid fever and pneumonia stand out with prominence, particularly when com- pared to occupied males in general. It is hardly more than speculation to attempt to state to what the increase in mortality among Illinois coal miners is due. Working con- ditions are undoubtedly getting better from year to year. Unquestion- ably it cannot be charged to any single factor, such as alcoholism, which has been decreasing throughout the period covered in the Tables; nor fatigue, since work hours have decreased while the assistance of blasting powder and machinery have increased ; nor, with the exception of certain diseases like typhoid and malaria, has geographical distribution in the State anything to do with it. It is probable that more are reaching the later age-periods when deaths are more frequent, since the industry is not, in its present dimen- sions, more than a generation old in Illinois. It is probable also that a 393 change in racial composition with a greater percentage of foreigners is a factor. It is more than likely that greater congestion of population and its attendant evils, without a corresponding increase in health super- vision of housing and living conditions are potent and basic factors. The death rate of Illinois coal miners (Table III) when compared with that of the entire United States Registration Area (Mortality Statistics, p. 19, 1916) is directly excessive for the following afflictions: Typhoid fever, 30.8 vs. 13.3; Cirrhosis of liver, 17.6 vs. 12.3; Suicide, 31.9 vs. 14.2; and Violence 398.2 vs. 90.9. VI. HOW MINERS COPE WITH SICKNESS AND DEATH HAZARDS. In many industries the management has taken a leading part in the organization of sick and benevolent associations and similar institutions. Thib has, however, not been the case in the mining industry of Illinois. Though some thought has been given the matter, very little has been done by the operators. No doubt this is closely connected with the fact that the miners have been thoroughly organized and in better position than most workingmen to make organized provision for themselves. However this may be, in reporting on organized aid the important details relate to what the unions are doing and to the provision made by fraternal orders and the foreign societies in which the miners may have mem- bership. Some years ago the State organization of the United Mine Workers planned to pay disability benefits in case of sickness or accident as well as to provide death benefits. It was felt, however, that with the entire expense resting upon the workmen, the dues required would be so heavy as to create dissatisfaction and the plan was given up. Except for the death benefit of $250 paid by the State organization, any provision made by the miners' organization is through the local union. Whether or not organized provision by the local union is found, depends very largely upon (1) the size of the working force in the mine or mines; (2) the location of the mine in respect to towns and cities; (3) the racial composition of the membership of the local; and (4) the attitude of the union officials. Where only a few men are employed and a benevolent association is found in the community, the local likely does nothing in the way of providing disability benefits. Where the mine or mines are located in a populous community, so many of the miners may belong to fraternal orders and foreign societies, that the need for provision by the local is lessened, and if made, is seriously interfered with. Again, where a majority of the miners are foreigners, most of them have show^n a preference for membership in the foreign societies, which besides paying sick and burial benefits, are more or less religious in aspect, and other organizations find it difficult to gain a foothold. Finally, where a local union does organize a disability fund or association, it is usually optional with its members whether or not they shall join, and a considerable percentage of the men may remain outside of it. To take an extreme case, a local was found with 1,714 members, only 220 of whom belonged to the benefit association affiliated with it. It should 394 be said however, that reports from 38 other locals with a total member- ship of 13,805 showed a total of 13,554 in the benefit funds maintained by them. ' . i . . x- In the various districts the following general information was secured relating to the extent to which sick benefit associations are main- tained by the local unions : District I : Very few locals have sick benefit societies. District II, III, VII, and VIII: A considerable number of the locals have such associations. District IV: About one-fourth of the locals have such associations but the number was reported as decreasing. District V : About half of the locals have such associations. District VI, IX, X, XI, and XII : Most locals have such associations. The Commission received replies to a questionnaire from 123 of the 305 miners' locals in the State. The summarized results indicate foughly to what extent they have made provision for sickness and death benefits. Of the 123 locals reporting, 37 had made regular provision for the payment of sick-benefits in stipulated sums per week; 15 levied assess- ments upon their members to assist those in need; 19 reported that they "passed the hat" to assist needy members ; while 52 reported that nothing was done by the union as such. The number of members in the 37 locals was 13,670; in the 15 locals 5,868; in 19 locals "passing the hat,'' 4,305. The 52 locals reporting that nothing was done by the union as such, had a combined membership of 16,937. The standards adopted by the 37 locals with definitely organized benefit systems, varied greatly. Seven had no waiting period whatever; 1 a waiting period of less than 7 days; 2 a waiting period of 7 but less than 14 days ; 5 a waiting period of 14 days; 3 a waiting period of more than 21 bijt not to exceed 30 days. The number of consecutive weeks for which benefits were paid was be- tween 5 and 8 in five cases; 9 and 12 in five cases; 13 in ten cases; 14 to 25 in ten cases; and 27 or more in five cases. Taking the maximum number of weeks in the year for which a member might draw benefits, it was between 5 and 8 in one case; 9 and 12 in four cases; 14 weeks in six cases; between 15 and 25 weeks in thirteen cases; and 52 weeks in nine cases. The other locals did not report definitely on this point. The benefit paid was not to exceed $4 per week in three cases; was $5 in twenty- three cases; $6 in six cases; $7 in two cases, and $8 in the other case where information was furnished. The State organization pays a death benefit of $250 in case of the death of a miner himself. To this the locals frequently add a second sum and possibly pay benefits in cases of death of wife or other de- pendent. There are 305 locals in the State with a membership of a little more than 90,000. Usable returns were obtained from 123 of these locals with a combined membership of 40,780. Of these 123, eighty-six with a membership of 30,660, added something to the State death benefit. The remaining 37 with a membership of 10,120, did not. Of those paying an additional benefit in case of death of member, 1 paid a benefit of $25; 11 a benefit of $50; 9 a benefit of $75; 27 a benefit of $100 or $125; 15 a benefit of $150 or $175; 7 a benefit of $200 to $399; and 6 395 a benefit of $500 or more. Fourteen^ all told, paid a benefit in case of death of wife of member. In two cases this was from $50 to $74; in three cases from $75 to $99 ; in seven cases $100 to $149 ; in one $300 to $399; in one $500 or more. Eleven of these locals paid benefits in the case of the death of children also. In one of these the benefit was less than $25 ; in four from $25 to $49 ; in six from $50 to $74. Whether or not this union provision is becoming more or less ex- tensive it is impossible to say. Complete records are not available and the statements made by those more or less familiar with the matter are contradictory. New associations have been organized here and there, while many of those organized have been abandoned after a time. The new ones have been organized to meet a need distinctly felt and to get rid of the irregular assessments and ^^passing the hat." Some have been abandoned because of the decreased need for them when compulsory compensation for accidents was adopted, a few because the dues re- quired were felt to be too heavy^ and still others because of the "bother" they gave in administration. This partial, unstandardized provision made by the local unions is supplemented by or is supplementary to the insurance provided by fraternal orders, foreign societies, and insurance companies. It was found that the fraternal orders are well represented in the mining districts. It could not be said that any one of these is univers- ally strong among the miners. At one place it is the "Odd Fellows" who predominate and at another the "Eed Men" or the "Moose," etc. The per cent of miners carrying sick benefits in such associations could not be accurately obtained in this inquiry, but many whose opinions were asked put it in the neighborhood of 50 per cent. Separate and distinct from these English-speaking fraternals are the societies among the "foreign classes." It was the universal statement that practically all foreigners belonged to some one or more of these orders. They seem more appreciative of insurance protection than the native Americans. Many of them have received their initiation into community insurance schemes abroad in the various countries from which they have come. In two or three districts it was found that a few insurance companies were making a special effort to write sickness insurance among miners There was nothing extensive in this direction. Some of the companies were making a feature of carrying miners at no greater risk than the balance of the populace. The usual forms of industrial insurance were everywhere present in the mining districts, through which children, in particular, are covered for funeral benefits. Summarizing, it may be said that through the union benefit asso- ciation, the fraternal order, the foreign society, and the insurance com- panies writing disability contracts, the majority of the miners are in- sured against sickness, acceptably or unacceptably as the case maye be. In some localities nearly all have disability insurance; in few cases does the percentage fall below fifty. It may be added, also, that many of the miners, perhaps the foreigners more than the others, carry sickness in- 396 suraiice in several organizations, so that the statement was frequently made that a man while sick might draw more money in sick benefits collected than he did while well and at work. All miners are entitled to death benefits from one or more sources. Their dependents are usualy provided with burial insurance. The above has been limited to pecuniary benefits in cases of sickness and death. Nothing has been said concerning provision for medical and hospital care for seldom do the organizations providing insurance provide anything more than cash benefits. However, some exceptional cases are noted in the next section of this report which relates to com- munity medical facilities. VII. COMMUNITY MEDICAL FACILITIES. First wid. — By State Law, all mines of certain size are required to have at least a minor first-aid equipment, consisting of litter, blankets, kit of bandages, simple instruments, antiseptics, etc. Furthermore, all mine managers (mine bosses and, as a rule, mine examiners, are required to have first-aid training for which they receive a license. Some large mines have first-aid teams. Occasionally a separate first-aid room with operating table and other appliances is at hand, and sometimes an emergency hospital room or building is found near the tipple. Some companies own ambulances. "Safety First" is always to the fore in mines. A refuge room or space is required by law near the foot of the hoisting shaft. Manholes or refuge places on haulage roads occur every 60 feet and must be on the side opposite the trolley wire on motor haul- age roads. At Marion, the miners' locals own an ambulance and main- tain an undertaking establishment for their own use. Sick quarterTs. — ^Men hurt or taken suddenly sick in the mine are rushed to the surface — usually to the engine room, the wash-house or the mine office. In the meantime the physician who is called by tele- phone has usually arrived. After first-aid attention is given the afflicted man is taken home where he goes under the supervision of the physician of his choice. Control of epidemics. — ^In the presence of an epidemic the mining company and the local union follow the policy of non-interference, leav- ing it quite entirely to the supervision of whatever local health authority is at hand. Insistence on vaccination against smallpox has been at- tempted at some mines. Closing of the wash-house may also be ordered. Stability of medical practice. — Inquiry showed that physicians in mining districts are just as likely to locate permanently, perhaps for life, as they are in other localities. They appeared to get less oppor- tunity for vacation periods than elsewhere. Physicians were practically always native Americans. •Contract practice. — As is well known, contract practice for so-much per-man-per-month is looked upon with disfavor by county medical societies. This feeling seems to be shared by the local unions also. As a result of this disfavor, contract practice is less extensively found than formerly in the mining districts. Of the 53 physicians interviewed, three maintained a contract practice on the basis of $1 per month per 397 family, or 50 cents per month in the case of single men. At one place where a large per cent of negroes are employed, the plan seemed to be running very smoothly, due largely to the energy of the colored phy- sician himself and the support he received from the operating company. Prevailing fee-rates. — The rates charged miners were the same as for other inhabitants in each district. In some smaller southern towns fee-rates were low but in general they vary little from one end of the State to the other. The usual fees were: for calls at the house, $2; night calls, $3 and up; office calls, $1 and up, usually with medicine included; milage, 50 cents a mile after the first mile, or, certain rates to certain places; confinement cases from $15 up. Whether the phy- sician looked to the operating company, the insurance company or the individual, remuneration was quite invariably upon the merit basis — so much for so much service rendered. For some forms of surgical work a fee schedule previously agreed upon with an insurance company was followed. Inquiry seemed to show that there was little haggling about the question of fees in State compensation cases or complaint about securing reasonable payment of bills from insurance companies. Mileage covered by physicians. — The mining physician covers a radius of about five miles in his practice. Variations depend upon rail- road facilities and other local conditions. Ratio of physicians to population. — The results of inquiry into this point were tabulated and showed that in normal times and considering the proximity of many mining centers to large cities, there is no dearth of licensed practitioners at hand and that (with one or two places ex- cepted) the ratio of physicians to the population is adequate to the present demand for their services. The actual ratio is, however, not quite so favorable as one physician to every 739 of the population as reported (1918) for the entire United States. Proximity to neighbor- ing large cities usually compensated for dearth of physicians locally. Non-medical practitioners. — Except in the larger mining cities there was almost an entire absence of osteopaths, chiropractors, neuro- paths, optometrists, mental and faith healers, etc. Licensed midwives were practically absent. Women practicing midwifery unlicensed, es- pecially in foreign communities^ were mentioned here and there. How- ever, foreigners were invariably desirous of getting a "good doctor" in maternity cases. With some instruction, many of these women could be trained to be of great practical service to busy mining physicians, although but few of them could meet the educational requirements of the law for a licensed midwife. Nurses and nursing. — The trained nurse is almost an unknown person in practically all mining communities even in non-war times. Whole counties were reported as without the services of a trained nurse, public or private. The number of practical nurses was found to be very limited also, but most physicians explained that there were two or three "handy" women in the vicinity to help out. Many persons expressed the opinion that a community organization to assume part or all of the cost of a trained nurse^s services would be advisable. 398 Diagnostic facilities. — While an X-ray was most apt to be readily available, still for such a convenience, as well as for most laboratory work, recourse was usually had to large cities. Such methods were reasonably prompt, but some physicians said that much more scientific medicine would be practiced were diagnostic facilities more convenient. Hospitals.— The proximity aad availability of hospitals to mining communities varied greatly. The accessibility of a hospital means much more to the physician and the patient's family and friends than it does to the patient, who may be taken easily enough to a hospital fifty miles or more away. But physicians cannot afford the time or the expense of trips to distant hospitals. Consequently, where hospitals are in the mining community itself, the extent of their use by coal miners and their families is much greater than when they are at a distance, and much of the physician's time is saved. It was found that miners rarely resort to hospitals for treatment, and members of their families even less so. The foreigner seems to appreciate the advantages of hospitalization more than does the American. • A cooperative miners' hospital is maintained by the various miners' locals at West Frankfort, in Franklin County, which is rather unique because of the fact that it is practically the only example of workmen's efforts in this direction in the country. It is a first-class hospital, managed by a board of trustees from among the miners, with an orofan- ized physician's and nursing staff. It is a busy place and receives both miners and members of miners' families, the hospital expenses beinor xnet by tl^e local unions. The only strictly mining company hospital was reported at Zeigler and was also visited. It is thorousrhlv equipped and manned, the hospital's expenses being met principally by the operating company. Organized aid and the physician. — The effects of the sick benefit association in relation to the physician is worthy of comment. Mem- bers of these associations, as well as of lodges and fraternals furnishing sick benefits, usually expect most of the fee for medical services to be met by the weekly cash benefit. In order to enable the afflicted one to secure this benefit, the physician fills out a certificate of illness. These financial arrangements were commented upon as often uninviting. Where a miner belongs to several lodges or societies, he presents several cer- tificates, usually each week. Sometimes health insurance companies and some of the fraternal societies require extensive blanks to be filled out. In practically all cases, physicians stated they made no charge for this service, and that they did the same because the patient was in their regular clientele and that they could not well do otherrvqse. A couple of physicians stated that they charged from 50 cents to $1 for such service. Nearlv all physicians interviewed complained that the multi- plicitv of certificates to be filled out s^ratis was the '^ane of their exist- ence." Two physicians in partnership in a busy mining community stated that between them at least eight hours per week were spent in this filling out of sick benefit certificates. Many physicians commented also upon the evident attempts at malingering which were associated with collections from benefit societies, 399 » and particularly where a workman was over-insured by carr}dng policies in several societies. Most physicians stated that they would like to see some other system adopted for the present sickness insurance relation- ship. For instance, the submission of bills directly to the benefit so- ciety and the dealing with a limited number of societies per patient were mentioned. Xone, however, attempted to devise a workable plan. The physician feels safer as to his own remuneration when he is dealing with an organized body, such as a lodge or society, than when he is deal- ing directly with many of the patients who seek his services in mining communities. Economics of medical practice. — There was no evidence to the effect that miners are not as good pay as any other class, considering race, locality and civil state. The general average of collections was about 65 per cent in nonnal times, and only somewhat better at present. Some physicians reported their collections as low as 50 per cent, but stated that they were not good collectors. Others, who had more business system, claimed collections as high as 90 to 95 per cent. Collections were better in isolated localities, as a rule. An interesting observation was made by a prominent physician in LaSalle, who stated that prac- tically all physicians^ bills there and in that vicinity were good because it was the result of twenty years' education of the populace to look upon them the same as upon grocery bills and to pay them promptly. In one place the business men of the town, including the physicians, kept a confidential list of persons, classified as good, average and bad bill payers. Increased labor turn-over at the mines was blamed for many fail- ures to collect. In many communities it was stated that slow pay was a bad feature, and particularly so in normal times when the mines were idle for a number of weeks or months each year. One physician in Saline County said he always got an order on a man's pay before he agreed to attend him or his family. Accident compensation has re- sulted in better collections and more prompt demand in the case of treatments for injuries. Multi-treatments, or the practice of calling one physician after another, or perhaps having two or more at the same time, each unknown to the other, was mentioned as frequent in communities of foreigners. All physicians had some charity patients, the number increasing in hard times. Chronic invalidism from sickness was not above the average. Many maimed indi^dduals are to be seen in all large mining towns. Physicians emphasized the great extent to which quackery and the practice of charlatans prevailed. Here and there counter-prescribing in which the druggist prescribes something instead of sending the afflicted one to a physician was mentioned. Also the fact that physicians' pre- scriptions were filled repeatedly without the physician's sanction, and perhaps for different sick persons. The old-time street medicine vendor has quite disappeared from most of the mining districts of the State. However, the practice of self-treatment, which embodies self-diagnosis, has undoubtedly extended, and unquestionably increases the spread of communicable diseases and the incidence and severity of all afflictions. It is especially fostered in mining districts by various types of nostrum 400 • propaganda, in which full use is madft of the advertising columns of newspapers, billboards, and the mails. Its most important cause is un- questionably lack of ready funds with which to pay for legitimate treat- ment. Another important cause is that the treatment is felt to be too expensive. VIII. GENERAL SUMMARY. By means of direct field survey, in which fifty-six mines and their associated communities in the twelve coal districts of the State were visited, and by means of questionnaires, the status of the health of Illi- nois coal miners was invesigated during the summer of 1918. Soft coal only is mined. The coal mining industry in the State is steadily in- creasing and employs over 90,000 workmen. Working conditions in Illinois coal mines are as good as, if not above the average found in most industries. While the mines are of deep character, they are dry, as a rule, with cool, even, and invigorating temperatures and the State mining inspection system succeeds generally in maintaining a good quality of atmosphere in the mines. The laws and regulations when followed appear to be adequate, although, un- doubtedly, minor amendments are constantly advisable. Practically all mines have wash-houses more or less adequate. A glaring omission is absence of latrines for workers about the top at a majority of the mines. A serious, common fault is lack of examination of drinking water supplies which miners use. There is practically no overtime even in the present stress. The eight-hour day prevails. All coal miners belong to the United Mine Workers of America. Foreigners, principally Italians and Eastern Europeans, predominate. But 6.1 per cent of 13,889 employees in 49 mines visited were found to be over 60 years of age. Wages are good but, in normal times many mines are idle for weeks and months each year because of the uneven demand for coal. Dust appears to be the chief health hazard which remains for the Illinois coal miner to-day. Physical strain, any evil effects of which could be frequently avoided if men were selected for their jobs by physical examinations, causes a train of musculo-osseous and possibly circulatory afflictions of incapacitating character. Housing conditions, community neglect, bad forms of recreational hygiene and especially alcoholism, undoubtedly constitute the chief causes of most sickness. This whole situation^ is due largely to the inadequacy of community health organization and prophylactic measures against diseases. Rheumatism, asthmatic afflictions and alcoholism constitute the chief forms of sickness. With the exception of tuberculosis, venereal diseases and possibly pneumonia, all common afflictions are of usual fre- quency in the practices of physicians in mining districts. Mortality statistics, on the other hand, show tuberculosis is more frequent than physicians suppose and that pneumonia is really excessive when compared to occupied males in general. Several diseases supposedly of industrial 401 character among miners, such as hookworm, nystagmus, and lockjaw were found to be non-existent. Mortality statistics show a gradually increasing annual death rate, beginning with 1,003 per 100,000 employed in 1912 (fiscal year) and rising to 1,185 for the first half of 1918. About two-fifths of all deaths are due to external causes (violence and mishaps) and, consequently, the prevalence of any other afflictions such as tuberculosis are overshadowed, when viewed from the cause of death. However, as compared to the United States Registration Area for 1916, the Illinois coal miner's death rate is directly and very decidedly excessive from typhoid fever, cirrhosis of liver, suicide, and violence. Illinois miners compare favorably with miners and quarrymen in the Registration Area (1909) as regards deaths from various causes. Geographical distribution in the State appears to have little relationship to death rates, except for malaria and typhoid — both pronounced in the south. The cause for the increasing death rate is not clear. Miners as a body, or as groups, cope with sickness and death hazards in many different ways, with greatly varying success, and with no very efficient methods. All sorts of schemes exist, depending upon localit}^, race, size of mining district, etc. Many miners' local unions maintain optional sick benefit societies, but all manner of modes of pro- cedure exist. Many of them are on the decline, due largely to the effects of State compensation for accidents. The miners' State organization pays a death benefit of $250 in case of the death of a miner. To this the locals frequently add a second sum. Occasionally, members of miners' families are included. The various national fraternal orders have strong representation in mining districts. Miners often belong to several and may derive over-insurance therefrom. No operating com- panies take a direct interest in benefit societies as with some other in- dustries. ]N'o insurance companies provide group insurance covering sickness for the employees of a mine. Industrial insurance by private companies, providing a small burial fund for children, is extensive. Community medical facilities are no more than fair. First-aid provisions at mines are good. Hospital facilities are very scarce. Local health administration is in a very bad way. Prophylaxis and preventive medicine is hardly known in most districts. There is great need of in- structions, also, in the fundamental facts of personal hygiene. Most dissipations were found to be the result of a misconception of what constitutes recreation. Medical practice in mining centers is maintained b)^ a set of steady, hard-working native American physicians, very few of whom engage in contract practice. Fee-rates for miners are the same as obtain for others, which rates do not vary much from one end of the State to the other, with the exception of a few smaller towns in the southern part. With the present demand for their services, there are enough physicians to the population in mining centers, especially in normal times. Trained nurses, and, in fact, practical nurses, are practically unknown persons in mining districts. Diagnostic facilities are meagre and most labora- —26 H I 402 tory work is sent to larger cities. More scientific medicine would be practiced in these districts were more laboratory and hospital facilities at hand. Physicians are not satisfied with the present relations which, they have with persons insured in various benefit societies for whom the physician must certify as to sickness before cash benefits ^re forthcoming and before the physician can receive his remuneration. Malingering is also a con- siderable feature, and many physicians were of the opinion that where an individual has a sick benefit in a lodge or society, an improvement in the situation might be made by submitting bills directly to the society instead of to the jiatient; also, that the number of societies in which a workman may insure against sickness could be limited to great advantage. In normal times miners, do not work steadily throughout the year in most districts, so that physicians have periods of decreased collections, although the miner pays as well as any other industrial class. Nostrum and quackery propaganda flourishes in mining districts. There is a very limited number however, of non-medical practitioners belonging to the various cults. There is much room for improvement. To a great extent it involves education in ideals. Some organized corrective efforts are undoubtedly advisable. Stress should certainly be laid on the application of means to prevent sickness as well as extension of means to cope with the sick- ness which exists. 403 SPECIAL REPORT VI. INSURANCE BY CASUALTY COM- PANIES AND ASSESSMENT ASSOCIATIONS. (By W. M. Duffus.) [Note hy the Secretary. — A very important part of the Commission's work was to ascertain as fully as possible the extent and character of existing health in- surance in Illinois. The Investigations made in this connection related to insur- ance in establishment funds, labor organizations, fraternal societies, independent foreign societies, and the many types of insurance companies and associations. A large part of this work was done by Professor W. M, DufCus, on leave from, the University of Kansas where he is Associate Professor of Economics. Professor Duffus has drafted the four special reports which immediately follow, relating, respectively, to Insurance by Casualty Companies and Assessment Associations, Fraternal Life and Disabilty Insurance, Industrial Life Insurance, and Group Life and Group Disability Insurance.] PART I. INSURANCE BY CASUALTY COMPANIES. (1) Introductory. The laws of the State of Illinois authorize the organization of casualty insurance corporations. These corporations may restrict them- selves in the purpose of their organization to "insuring any person against bodily injury, disablement or death resulting from accident, and providing benefits for disability caused by disease/^ or may also write other kinds of insurance such as fidelity and surety, workmen's com- pensation, burglary, plate glass, and credit insurance. The laws permit the admission into Illinois of similar corporations organized under the laws of other states or the laws of foreign governments.^ Stock life insurance companies, upon compliance with certain conditions, may engage in the health and accident business. Of the 73 "casualty com- panies" possessing licenses to transact a health and accident insurance business in Illinois on December 31, 1917, 25 were authorized to transact this kind of business only while 48 were writing one or more other lines of insurance. Eight of the companies were Illinois corporations, 57 were corporations of other states and 8 were corporations of foreign govern- ments.^ Casualty companies may be organized in Illinois on either the stock or the mutual plan.^ Two of the Illinois companies were mutual companies ; the six remaining Illinois companies and all of the companies of the other states and foreign governments were stock companies.* Information concerning the health and accident insurance business conducted by casualty companies in Illinois was obtained through a questionnaire sent directly to the companies by the Insurance Superin- ^ Insurance Laws of the State of Illinois, 1917, compiled by the Department of Trade and Commerce of the State of Illinois, Insurance Division, Chapter VII, p. 114. ^ Official Statement Showing the Financial Condition and Bitsiness of the Mis- cellaneous Insurance Companies for the Year Ending December SI, by the Depart- ment of Trade and Commerce of the State of Illinois, Division of Insurance. ^Insurance Laws of the State of Illinois, 1917, pp. 114-117 and 137-143. "iSee Note 2. 404 tendent acting in cooperation with this Commission, by correspondence and personal interviews with representatives of the companies and from the testimony of the latter and of other persons at the public hearings held by the Commission. Considerable information was obtained also from the family studies described elsewhere in this report.^ Up to the present time the casualty companies have been of minor importance in Illinois as carriers of health and accident insurance for wage-earners. It is true that the companies do carry a large volume of workmen's compensation and employer's liability insurance for em- ployers of labor in Illinois, but these kinds of insurance, notwithstanding their importance to the wage-earners of the State, cover only a part of the accident hazards and few of the sickness hazards to which they are constantly exposed. It is also true that some of the companies maintain "industrial departments" and have devised health and accident policies especially designed to meet the needs of wage-earners and that these com- panies do most of their business with wage-earners. Policyholders of this class, however, are in the minority in the total number of holders of health and accident policies issued by casualty companies in Illinois. For the purposes of the present investigation the casualty companies are more important because of the possibilities for increased usefulness to wage-earners in the future which the spokesmen of the companies allege are found in their plan of providing health and accident insurance than because of past service and accomplishment in providing wage-earners with insurance. It is impossible to state exactly the number of persons in Illinois who carry health and accident insurance with casualty companies. The companies are not required by law to report the number of outstanding policies in the State or to report the number of policyholders to the In- surance Superintendent, and only about one-third of the companies have provided this Commission with detailed information requested on this particular point. Some of the companies have reported that they have no records which would give the information; others that they have been unable to compile the information because of a shortage in office help due to war conditions; while a number in returning the blanks sent them have omitted the statement requested without comment. In this re- grettable absence of complete statistics the Commission can only esti- mate the number of health and accident policies outstanding against casualty companies in Illinois. Because of the insufficient data obtainable and the variety and com- plexity of the health and accident insurance policies which are written in Illinois it is difficult to make an accurate estimate of the number in' force in the State. In fact it is possible to make only a rough guess at the exact number. Estimates of the average cost per year of the health and accident policies written by casualty companies vary from $15 to $20.® The total amount collected by the casualty companies for health and accident insurance in Illinois in 1917 was $3,489,330.32.^ If the " See Part II, Special Report I. ' Report of the Social Insurance Commission of the State of California, 1917, p. 240. ''Insurance Report Illinois, 1917, Part III, pp, 7 and 8. 405 $20 estimate is accurate for Illinois the nuniber of policies in force in the State in 1917 was about 175,000; if the $15 estimate is accurate the num- ber was about 235,000. It seems desirable to estimate only the upper limit of the number of policies and to err, if at all, on the side of over- statement rather than on that of understatement. Approaching the matter in this way and using such data as are available the Commission has come to the conclusion that the total nimiber of health and accident policies (including the combined health and accident policies as well as the policies which provide health insurance or accident insurance only) which were in force against casualty companies in Illinois on December 31, 1917, did not exceed 250,000.^ The number of policyholders was, of course, somewhat less because of the fact that some policyholders — how many it is impossible to ascertain — carry more than one policy. • The foregoing estimate has to do with the number of all persons of all economic classes in Illinois who are insured with casualty insurance companies against sickness and accident and is not restricted to the num- ber of wage-earners so injured. In order to get information as to the relative importance of wage-earners among the policyholders a question was included in the questionnaire sent by the Insurance Superintendent to the companies regarding the percentages of Illinois policyholders who were "wage-earners or members of wage-earning families." Answers of scientific accuracy were not expected and were not received but it is believed that the answers which were received can be relied upon, in the aggregate, to throw some light on the situation. A large proportion of the health and accident policies sold by casualty companies in Illinois are purchased by business and professional men and by salaried persons. Some companies confine their business entirely to members of these classes. Others accept wage-earners as policyholders but do not actively solicit their patronage. A few com- panies in recent years have specialized chiefiy in the sale of health and accident insurance to farmers. A number of companies, however, de- pend upon wage-earners for the greater part of their business and make especial efforts to attract wage-earner policyholders. Returns of the questionnaire sent out by Insurance Superintendent Potter were received from 44 casualty companies. One of these com- panies began business in Illinois in February, 1918, and its experience is therefore insufficient to serve as the basis for any conclusions. Of the remaining 43 companies 9 either made no statement as to the percentages of wage-earners or members of wage-earning families among thier policy- holders or reported that they had no records which would show these percentages. Of the 34 making definite replies 5 stated that "none'' or "practically none" of their policyholders were members of the wage-earning class while the others reported various percentages of their policyholders, ranging from 5 to 100 per cent, as being of this class. It would perhaps »It is worth noting, for purposes of comparison, that the number of assess- ment, accident and health association certificates in force in lUinois on December 31. 1917, is reported as 228,030. See Superintendent of Insurance Fred W. Potter's Summary of the Standing, December SI, 1917, of the Assessm,ent Life, Accident, or Health Associations Transacting Business in Illinois. 40(5 not be inaccurate to say, after making allowances for the looseness with which some of the companies have obviously interpreted the term "wage- eamei*"' in making their returns, that about 100,000 of the Illinois holders of the health and accident policies outstanding against the companies on December'31, 1917, were members of the wage-earning class. In order to understand the full significance of the foregoing state- ment in its relation to tlie problem of health insurance it is necessary to consider the composition of this group of wage-earners and to compare it numerically with the total membership of the wage-earning class in Illi- nois. In general it may be said that the health and accident insurance provided by the casualty companies is so expensive that only the more highly paid wage-earners, chiefly mechanics and other skilled laborers and employees occupying positions of responsibility, feel that they can afford to purchase insurance of this kind. The reasons for the high cost of thi^ insurance will be discussed later. (2) Policij-Coiitract used by Casualty Companies. Three kinds of policies are used by casualty companies in selling health and accident insurance: health policies, accident policies, and combination health and accident policies. Each of the first two classes, as the names indicate, provides only the kind of insurance named; the combination health and accident policies insure the policyholder in one contract against both accident and sickness. Some companies write all three kinds of policies; others issue only the combination contracts. The health and accident policies of the casualty companies are also classified as "commercial" and "industrial.^^ Commercial policies com- monly provide weekly benefits to compensate for loss of time from dis- ability due to sickness or accident, as the case may be, ranging from $10 to $50 or more and other benefits which are correspondingly high, and are usually sold on the annual premium plan.^ Industrial policies provide smaller benefits, ranging from $20 to $125 per month for disability re- sulting from accident or disease, and are usually sold on the monthly premium plan although some are purchased by quarterly and many by weekly premium^. The commercial policies are designed to meet the needs and preferences of business and professional men and the better- paid salaried employees. The industrial policies, as the name suggests. are intended to attract wage-earners. Health and accident policies, like life insurance policies, may be written on individual risks or a group of persons may be insured under a blanket contract. So far little has been accomplished in the attempts that have been made to develop the use of gronp health and accident con- tracts in the United States. The discussion which follows in the present chapter is therefore limited to the business in individual policies and group health and accident insurance is left for consideration in the re- port on group insurance.^^ » Some policies are sold to farmers in Illinois who prefer to purchase in that way on the three-year basis as fire insurance is often sold. "See Part II, Special Report IX. 407 11 (3) Benefits Promised in Health Insurance Contracts. The health insurance policies formerly sold by casualty companies insured against disability resulting from only a limited number of dis- eases, which were enumerated in the policy, but contracts which insuro against nearly all diseases are now sold by most companies. The dis- eases most commonly excluded are diseases "contracted" * * * "while the insured is engaged in military or naval service," diseases* caused by accidental injuries, disease "contracted and suffered without the limits of the United States, Canada and Europe," or diseases contracted within the tropics or within certain parts of them, as the Philippine Islands or the Panama Canal Zone, and diseases contracted in Alaska and "the British possessions in America north of the 55th degree of North Latitude," "sickness resulting from the use of intoxicants, or narcotics," "any illness not common to both sexes," any "sickness for which the insured is not regularly treated by a legally qualified and registered physician" and venereal diseases. Some policies contain only the re- striction against venereal diseases; few if any of the policies offered for sale in Illinois contain all of the restrictions enumerated above. Although most health insurance contracts issued in Illinois by casualty companies cover many and frequently nearly all diseases, there is some sale in the State of a type of contract which covers certain specified diseases only and is therefore cheaper than the contracts which are more inclusive in their coverage. Several companies offer this "limited sick- ness contract" to the public in Illinois in combination with an accident insurance contract and one company offers the contract in a separate health policy. One company insures, in the combination policy to which reference is made, against disability arising "from any one or more of 50 diseases ;"^^ a second insures against disability resulting from any one or more of 42 diseases; and a third insures against disability resulting from any one or more of 29 diseases. The health insurance policies written by casualty companies provide for a number of benefits to cover money losses which occur in various wa3's as the result of sickness. The most important of these benefits is that for "loss of time." It is the object of this to indemnify the insured for the money loss which he suffers through disability which incapacitates him, wholly or partially, for the performance of the duties pertaining to the occupation upon which he depends for his livelihood. For this reason health insurance has been called "income insurance." The sum paid in a given case is not determined, however, by the amount of income ^^ The discussion in this section applies to the "siclcness benefit" or "illness indemnity" provisions of the combined health and accident policies as well as to the policies which provide health -insurance only. It is bashed larg-e!y upon a study of sample policies submitted to the Commission by the casualty companies doing business in Illinois in response to a request for a complete sample set of all policies being offered for sale within the State. ^2 The 50 diseases covered are as follows : "Acute cerebral meningitis, Addi- son's disease, aneurism of aorta, angina pectoris, appendicitis, Asiatic cholera, Bright's disease, calculus (renal), cancer, chicken pox, cirrhosis of liver, colitis, systitis, diabetes, diphtheria, dysentery, endocarditis, enteritis, enterocolitis, enteric catarrh, epilepsy, erysipelas, felon, gall stones, gastric catarrh, gastralgia, gas- tritis, gastro-entertis, hemorrhoids, intussception, malignant pustule. meaHles, mumps, pericarditis, peritonitis, phlebitis, pleurisy, pneumonia, Pott's disease, pye- litis, scarlatina, scarlet fever, small-pox, typhlitis, typhoid fever, typhus fever, varioloid, vesicle calculus, volvulus, or yellow fever." 408 actually lost by the insured through illness— the "loss of time" benefit may be paid if there is no loss of income whatever — but is fixed by the terms of the policy at a definite amount per week or month regardless of the effect of the disability suffered upon the income of the insured. The only relation which prevails between the loss of time benefit provided by a given policy and the income of the insured is that the indemnity is ordinarily fixed at a figure somewhat less than that of the income. This is insisted upon by the insurance companies in order to avoid the moral hazard always present in over-insurance.^^ The (commercial policies most frequently sold in Illinois provide for weeky illness indemnities ranging from $25 to $50 payable for a period limited to fifty-two consecutive weeks, for "total disability/' or "total loss of time/' as it is called in some policies. The industrial policies most frequently sold provide for monthly indemnities of $45 or $50 for "total disability." Industrial policies providing for indemnities as low as $20 per month are not uncommon, however, while some insuring payments as high as $100 or $125 per month are sold. "Total disability" is usually defined in the health insurance policy as disability which "shall continuously totally disable and prevent the Insured from transacting every kind of duty pertaining to his occupation and shall necessarily and continously confine him in the house where he shall be regularly visited by a licensed physician" or in similar language of the same intent. In addition to the benefit for total disability just described most health insurance policies provide an indemnity for disability suffered dur- ing the period of convalescence (or a limited portion of it) following a totally disabling and confining sickness. The disability suffered during convalescence may be total or partial. Some policies provide indemnity for the first form of disability, usually called "non-confining total disabil- ity" in the contract, and some provide indemnity for the second form which is commonly called "partial disability." "JSTon-confining total disability" is defined as total disability which does not necessarily confine the insured to the house. In some policies pa}Tnent for this kind of disability is to be made only when it is a result of the confining and totally disabling disease which it follows; in other policies payment is also to be made for "non-confining total disability" which follows a confining and totally disabling sickness but is the result of another disease; and in still others payment is to be made for "non-con- fining total disability" caused by any disease not specifically excluded, whether it follows a confining and totally disabling sickness or not. "Partial disability" is variously defined in different policies but practically all the definitions agree in making inability to perform a greater or smaller portion of the regular duties of the occupation of the insured the test of partial disability. To illustrate, one company de- fines partial disability in one of its health insurance contracts as disability "following a period of total disability * * * (which) shall con- tinuously disable and prevent the Insured from performing the duties of his occupation for at least half of his business time each day;" another "See below, p. 421. 409 compart}^ in one of its policies defines "partial illness — disability" as dis- abilit}^ which "continously prevents the assured * * * from per- forming any important duty pertaining to his occupation;" and a third company defines partial disability as disability, not total, which causes the insui'ed to suffer "a material loss of his business time." Partial dis- ability benefits are promised in some policies for partial disability which does not follow a period of total disability. The amount of the indemnity paid per week or month for non-confin- ing total disability and for partial disability is usually one-half of the indmnity paid for total and confining disability, although in some policies and under certain conditions a larger proportion is paid. The payment of the indemnity is limited in most commercial policies by a provision which fixes the maximum number of weeks for which indemnity may be paid on account of sickness, total and partial disability combined, or total confining disability and total non-confining disability combined, at 52 weeks. That is to say, the maximum number of weeks for which the indemnity for partial disability or total non-confining disability may be paid is the dift'erence between 52 weeks and the number of weeks for which the indemnity for total, confining disability has been paid. In industrial policies the period covered by the indemnities mentioned varies somewhat more than in the case of commercial policies but most industrial policies sold in Illinois limit the total maximum length of time to be covered by the total and partial disability indemnity to- gether to six or eight months and provide further that the partial dis- ability indemnity or the non-confining total disability indemnity, as the case may be, shall be paid for not to exceed one or two months. An attempt has been made in the foregoing discussion to describe provisions governing the payment of indemnities for loss of time result- ing from illness disability that are typical of the health insurance poli- cies sold by casualty insurance companies in Illinois. No attempt has been made, or can be made within the limits prescribed for this report, to describe all of the various loss of time indemnities offered for sale in health insurance policies in the State. Some attention should be given, however, to certain loss of time benefits^ other than those already mentioned, which are more or less frequently found in the health insur- ance policies now being sold. Some policies do not require that a disability suffered by the insured confine him to the house in order to entitle him to the full weekly or monthly payment for total disability but provide that the full indemnity shall be paid for total disability resulting from non- confining illnesses. A few commercial policies do not limit the pay- ment of the weekly benefits to 52 weeks of continuous total disability or total and partial disability but promise the payment of one-fourth of the full weekly benefit "as long as the insured continuously suffers" total disability from an illness, which of course may be for the remainder of his life. Some policies provide specifically that the full loss of time indemnity shall be paid if the insured is totally disabled by "carbun- cles, boils or felons" or "carbuncles, boils, felons, abscesses or ulcers,'^ to quote the longer list found in a few policies, regardless of the fact 410 that his disability may not confine the insured to the house. Several policies promise to pay an "indemnity for quarantine" equal to the full weekly benefit (double it in one policy) for a period not to exceed ten weeks in case the insured is quarantined by order of the "civil authori- ties" because of an "infectious or contagious disease" which he has contracted and "by reason of said quarantine is prevented from per- forming any and every kind of duty pertaining to his occupation." Finally many of the policies restrict the payment of the usual weekly or monthly indemnity in the case of certain chronic diseases and dis- eases of long duration by providing that the indemnity shall be paid for only a fraction of the maximum period. Thus one industrial policy which promises the payment of a monthly illness indemnity for a maxi- mum of six months for most diseases, restricts the payment of the indemnity to "a period not exceeding one month in any one policy year" in case the insured suffers total and confining disability "by reason of rheumatism, tuberculosis, paralysis, neurasthenia, sciatica, Brighf s disease, apoplexy, locomotor ataxia, cancer, neuritis, sprain or strains, lumbago, orchitis, hernia, or any chronic disease." A policy issued by another company carries a similar restriction but adds "lame back," vaccination, diabetes, appendicitis, varicose veins, dementia, and insanity to the list of diseases excluded from liability for full benefit. A third policy, issued by a third company, has a more liberal clause governing "special diseases" in which the maximum period for which the weekly benefit may be paid is reduced from twelve months to six months and only four diseases — paralysis, tuberculosis, cancer and locomotor ataxia — are included.^* In addition to the benefits paid for loss of time which have Just been described, many of the health insurance policies sold in Illinois promise one or more of a number of other benefits to cover money losses or money expenditures caused or necessitated by sickness. These include payments to reimburse the insured, within specified limits, for hospital expenses, the cost of surgical operations and the cost of medical attendance or of the services of a trained nurse, and payments for blindness and paralysis or other permanent disability and for funeral expenses. Of these indemnities, those for hospital expenses and sur- gical operations are most common; in fact they are the only ones of those named which are included in many policies.^^ The hospital benefit clause provides for the payment of a weekly or monthly indemnity in addition to the disability benefit in case the illness of the insured (usually within 90 days or three months of the beginning of the illness or the disability) necessitates his confinement in a hospital.^* In some policies the hospital allowance is fixed at one- half the regular weekly or monthly benefit; in others, it is made equal "The use of the words "more liberal" is not intended to disparage the sale of policies with less liberal special disease clauses. The merits of any particular insurance policy should always be considered in relation to the premium paid for the policy. "Some policies do not contain any of the indemnities enumerated above. "Many policies containing the hospital indemnity clause limit the payment of the indemnity to cases where the insured is confined in a "regularlv incorporated" or a "licensed" hospital. 411 to the regular benefit; frequently it is made to cover the hospital charges exactly in so far as they do not exceed one-half the regular sum. The duration of the period for which the hospital allowance will be paid is limited, in diiferent policies, to a maximum which ranges from 10 to 26 weeks for the commercial policies and which is commonly three months for the industrial policies. In policies which also pro- vide for the payment of specific sums for surgical operations it is often stipulated that no hospital allowance shall be paid if the insured claims the benefit of the surgical operations clause. The surgical operations clause usually promises the payment of a fixed amount of money, which varies according to the nature of the operation and the amount of the weekly or monthly disability benefit, in case the insured has io undergo any one of a number of specified surgical operations, as the result of the illness which has disabled him, within a specified time (usually 90 days in commercial policies) after the commencement of the illness. Sometimes, however, the surgical operations clause provides for the payment of the full cost of the oper- ation, regardless of its nature, in so far as the cost does not exceed a certain multiple, e. g. double, the regular disability indemnity. The policies which promise the payment of surgical indemnities of fixed amounts according to the nature of the operation commonly enumerate from 30 to 40 operations.^^ Three policies stipulate that the insured shall not receive indemnity for more than one operation for any one sickness or disease; if he has to undergo more than one operation he " The following' schedule is fairly typical, as respects both operations included and amounts payable, of the health insurance policies which promise surgical operation indemnities. Schedule of Operations to the Insured. Amounts payable in addition to other benefits for each Five Dollars of weekly indemnity. Appendicitis ( see Laparotomy) Aneurism (Tumor of Artery — Ligation $10.00 Abscess or Boil — Incision 1.00 Bone Abscess — Trephining- 5.00 Bronchotomy, Thyrotomy, Laryngotomy, Laryngotracheotomy, or Trache- otomy 10,00 Carbuncle — Incision and Treatment 1-00 Eye. Ear. Nose And Throat — Any cutting operations 2.00 Felon — Incision 1-00 Ganglion (Cystic Tumor of Tendon Sheath) — Incision and Curetting 3.00 Hernia (Abdominal) — Any ovitting operation for the radical cure of the Reducible. Irreducible or Strangulated form 20.00 Hydrocele — Tapping — Incision or Excision of Sac 5.00 Ingrowing Toe Nail — Removal . • 2.00 Intestinal Obstruction (see Laparotomy) Kidney — Fixation or removal 20.00 Laparotomy (opening of the abdominal cavity for an operation on any organ contained therein, or for Exploratory Incision) 20.00 Lithotomy (operation for removal of stone in bladder) — any cutting 20.00 Mastoiditis — Operation for 10.00 Oesophogotomy for Structure or other cause 20.00 Parentecis — Tapping of Abdomen 5.00 Bladder 5.00 Ear Drum on nn Peritonitis (see Laparotomy) 20.00 Rectum — Operation for — Hemorrhoids (external or internal) — Excision or Ligation 5.00 Prolapsed — Operation for 5.00 Fistula in Ano — Incison 5.00 Polypus — Extirpation onnn Malignant Stricture — Excision or Colostomy 20.00 Tumors — Extirpation from any part of the body — Benign 3.00 Malignant ^nn Varicose Veins — Ligation or Excision 5.00 Varicocele — Acupressure — Ligation or Excision 5.U0 412 . is usually either paid for that operation for which the allowance is largest or, which amounts to the same thing, he is given the privilege of choosing the operation for which he is to be indemnified. The "medical attendance" or "medical treatment" clause is found more commonly in accident insurance contracts than in the health policies. but some of. the latter contain the clause/^ The clause as used in commercial health policies usually provides for the reimbursement of the insured for expenditures for the services of a physician to an amount not exceeding the weekly benefit promised in the policy, in case the insured suffers an illness which requires medical treatment or medical attendance but does not result in disability. A few policies provide for the payment of a limited amount to cover nurses' fees in lieu of the hospital allowance in cases where the insured, while suffering disability from illness, is attended by a grad- uate nurse although not confined in a hospital. The amount of the indemnity is usually subject to the same limitations as the amount of the hospital indemnity. ^ext to the allowances for hospital expenses and surgical opera- tions the "blindness and paralysis" benefit or the "permanent disability" indemnity, as it is called in some policies which do not limit the forms of disability for which the indemnity is to be paid to blindness and paralysis, is the most conmion of the minor benefits promised in the health insurance policies sold by casualty companies. This benefit is a payment for permanent, total disability. Its nature can perhaps best be made clear by quoting a typical section which provides for it from a policy sold in Illinois by a well-known casualty company. This sec- tion reads in part as follows: ''Special indemnity for blindness or paralysis. — In the event that any disease for which indemnity is payable under the terms of this policy shall result, independently of other causes, in the irrecoverable loss of the entire sight of both eyes or in permanent paralysis whereby the insured shall lose the use of both hands or both feet, or of one hand and one foot, and on account of either of said conditions be permanently unable to engage in any labor or occupation, the company will pay said weekly sickness indemnity for the period of such blindness or paralysis, but not extending beyond one hundred and four weeks from the com- mencement of the illness or disease causing the blindness or paralysis. "No payment under the terms of this part * * * shall be due or payable until such permanent blindness or paralysis has continued for one year ; further payments, if any, shall then be due and payable every sixty days but no payment whatever shall be due or payable except upon proof of the continuance of the blindness or paralysis during the period for which payment is claimed." The above section further provides that the special indemnity for blindness or paralysis and the regular weekly benefit for sickness shall not be paid "for any concurrent time," that is, that the payment of the regular weekly benefit for sickness shall cease when the payment of the special indemnity begins. " In accident policies the clause often reads "Surgeon's Fees" instead of "Medi- cal Attendance." 413 The policies which cover permanent and total disability from other causes as well as from blindness and paralysis vary somewhat in their terms. Most of these policies, however, cover permanent and total dis- ability arising from the permanent and entire loss of the *'use of both hands or both feet, or one hand and one foof ' as the result of sickness in addition to permanent and total disability arising from "insurable paralysis."^^ A few of the industrial policies which have been submitted to the Commission cover permanent total disability arising from any cause for which the ordinary (temporary) total disability benefit is pay- able in a clause which provides for the payment of a fraction (for ex- ample, one-fourth) of the regular monthly sum for as long a time as the total disability continues. In policies which provide for health insurance only, the amount to be paid under the "blindness and paralysis'^ or the "permanent dis- ability''' section is usually stated in terms of the maximum number of weeks or months for which the regular sickness benefit will be paid from the commencement of the illness including the period for which the regular indemnity is ordinarily payable, as in the policy quoted above. The maxium is fixed at 104 weeks in most commercial policies, but it is frequently fixed at 100 weeks and sometimes at 150 weeks, 156 weeks (three years) or 200 weeks. In combination health and accident policies the sum paid for perma- nent disability resulting from sickness is sometimes stated in the same terms as in the health policies and sometimes as a fraction of the "principal sum," which is the amount payable under the terms of an accident policy for death resulting from accidental bodily injuries.^^ When stated m the latter way the amount is usually fixed at one-fourth, one-third or one-half of the principal sum and made payable in full at the end of the first year of total, permanent disability. Only five of the 44 casualty companies which returned the question- naires sent them on behalf of the Commission reported that they provide funeral benefits in case of death by sickness in policies sold in Illinois. Two of these companies are Illinois stock companies which are authorized by their charters to engage in the life insurance business and which write a funeral benefit clause in some of their health contracts in return for the payment of a life insurance premium to cover the cost. Another company is a mutual casualty company organized under the laws of this State; and the laws of Illinois permit mutual casualty companies to in- clude provision for funeral benefits in their health insurance policies.^^ The remaining two companies are stock companies organized under the laws of other states. Both are life insurance companies with charter powers to do health and accident business. The amount paid as funeral benefit is $100 in the case of each of the five companies mentioned ex- cept that two of the companies provide for the payment of smaller sums if death occurs within one year of the date of the policy. ^' A few policies include disability caused by insanity, if insanity results from a disease for which the insured is entitled to receive indemnity, in the permanent disability clause. ^^ See p. 414 below. ^ See Insurance Laws of the State of Illinois^ 1917, pp. 137 and 138. 414 (4) Benefits Promised in Accident Insurance Contracts. The accident insurance policies sold by casualty companies resem- ble in many respects the health insurance contracts which have just been described. It will therefore be necessary in this section only to indicate the similarities and to describe briefly the points of contrast. It is the purpose of accident insurance to protect the insured, to quote a typical insuring clause, "against loss resulting directly and in- dependently of all other causes, from bodily injuries effected solely through external, violent and accidental means, suicide (sane or insane) not included.^^ The principal losses covered are loss of time, loss of sight, loss of limb and death. One of the most important respects in which the typical accident insurance policy differs from the typical health insurance policy is in the provision in the former for the payment of a sum called the "princi- pal sum" in the "event of the death of the insured from accidental means. ^^ It will be recalled that only five companies writing health insurance re- ported to the Commission that they included provision for funeral bene- fits in health policies issued by them and that the maximum amount paid was, in each case, $100. The amount stipulated as the principal sum varies with the nature of the policy and, for a given class of risks, with the amount of the premium paid for it. Commercial accident policies commonly carry $5,000 or $7,500 as the principal sum for every $25 of weekly indemnity for disability resulting from accidental injury. Industrial policies differ widely in respect to the amount of the principal sum; one com- pany, for example, writes industrial policies which provide for the pay- ment in the event of accidental death of sums ranging from $100 to $1,200 according to the class of risk and the premium paid for the policy. The sums paid for loss of sight and loss of limb in the typical accident policy are fixed in terms of the principal sum. The schedule usually runs as follows : For loss of.* Indemnity. Both hands The principal sum Both feet The principal sum One hand and one foot The principal sum Entire sight of both eyes The principal sum Either hand or either foot One-half the principal sum Either eye fOne-third the principal sum • "Loss" Is defined in a typical policy as meaning "with regard to hands and feet, dismemberment by severance at or above wrist or ankle joints ; with regard to eyes, entire and irrecoverable loss of sight" * * *. t One-half in some policies. Some policies also provide specific indemnities in terms of the prin- cipal sum for the loss of either arm or either leg, the loss of either hand or foot and the sight of one eye, and the loss of the thumb and index finger of either hand. The indemnities for these losses have not been as well standardized as the indemnities for the losses indicated in the above table; in general they vary from two-thirds or three-fourths of the principal sum payable, in some policies, for the loss of an arm or leg^® ^ Some accident policies do not provide for the payment of a principal sum. ^ "Loss" with regard to arms and legs means severance at or above the elbow or knee. 415 to one-fifth or one-sixth which some policies promise for the loss of the thumb and index finger of either hand.-^ Most policies provide that the dismemberment and loss of sight in- demnities shall be paid only if the losses occur within ninety days of the date of the accident or, if the injuries continuously disable the insured from the accident to the date of the loss, within 200 weeks. The reason for this time limitation has been stated as follows by a representative of the casualty companies.^^ ^'Experience has shown that if the loss is remote in period of time from the accident it will probably be contributed to by disease, or by causes other than accidental and, therefore, not contemplated being covered by the policy, and it is to afford the company protection against liability for such complicated cases that the time within which the loss must be incurred is thus limited and qualified.'^ In addition to the specific indemnities for death, dismemberment and loss of sight, accident policies provide for the payment of the weekly or monthly benefit for total disability which continues from the date of the accident to the date of the occurrence of one of the losses mentioned.-^ The weekly or monthly indemnity for total disability in accident policies is similar in amount (and also in respect to the conditions under which it becomes payable) to the weekly or monthly payment for total disability in health policies. The former differs from the latter, how- ever, in the time limit placed upon its payment, which ranges from two years in some policies to "so long as the insured lives and suffers such total disability^ in others, instead of being fixed at six or eight months as in most industrial health policies or 52 weeks as in most commercial health policies. Partial disability is defined in about the same terms in accident policies as in health policies. Payment of the indemnity for partial disability from accident is usually limited to one-half of the amount paid for total disability and to 26 or 52 weeks time. The weekly and monthly payments for total disability described above are paid for injuries which do not result in any of the specific losses indicated in the table and discussion on page 416. The insured is usually given the option, however, of claiming the payment of certain fixed sums, called "elective" or "optional indemnities," in lieu of the weekly or monthly indemnities in case he suffers certain* injuries which are specified in the policy and which include loss of fingers or toes, dis- locations and fractures. This option gives the insured the opportunity to secure an immediate settlement of his claim in full without waiting for the payment of the regular weekly or monthly indemnities — an ^ "Loss" as here used means "severance at or above the metacarpo-phalangeal joint." ^ F. Leroy Templeton in chapter on "The Policy" in Dunham's Biosiness of In- surance, Vol. II, p. 24. 2^ Accident policies usually provide that only one of the specific indemnities mentioned shall be paid for injuries from a given accident and that the policy shall terminate with the payment of this indemnity. 416 opportunity which may prove desirable to an injured person hard pressed for cash.^^ The hospital, surgical operation and medical treatment indem- nities in accident policies are similar to those in health policies. The surgical operations schedule in the accident policy necessarily differs from that in the health policy because of the inclusion in the former of operations to reduce fractures and dislocations, amputations and the treatment of gun-shot wounds and the like, but where the same operation occurs in both schedules the amount allowed is usually the same for the same weekly or monthly indemnity.^^ Accident policies which contain the surgical operation indemnity feature commonly stipulate that any operation for which an allowance is paid must be performed within ninety days of the date of the accident, just as health policies make a "The following- schedule is typical of the elective indemnities provided in com- mercial accident policies : Schedule of elective indemnities. The amounts specified in the following- "Sched- ule of Indemnities" are payable i fthe policy is issued for a single weekly indemnity of twenty-five dollars ($25) ; proportionate amounts being payable if the policy is issued for a larger or smaller amount. For Loss of Certain Members by Removal : Within ninety days after injury, viz. : Of one or more fingers (at least one entire phalanx) $150.00 Of one or more entire toes 200.00 For Complete Hernia, caused solely and directly by accidental injury 70.00 For Complete Dislocation, viz. : Of the shoulder 100.00 Of the elbow 100.00 Of the wrist 125.00 Of the hip 300.00 Of the knee 150.00 Of any bones of foot 150.00 Of the ankle 150.00 Of two or more toes 50.00 Of two or more fingers 50.00 For the Complete Fracture of Bones, viz. : Of the skull, both tables 325.00 Of the lower jaw 75.00 Of the collar bone 150 00 Of the pelvis 250.00 Of the thigh 300.00 Of the leg 200.00 Of the knee cap 200.00 Of the arm between elbow and shoulder 30o!oO Of the forearm between the wrist and elbow 150.00 Of two or more ribs 100.00 Of the foot 125.00 Of the hand 125,00 Of two or more toes .*...!.!*.!.*!....,.. 100.00 Of two or more fingers !.*.!!'.!!. 10o!oO 28 Tj^g following schedule is fairly typical, as respects' bo'tti* operations included and amounts payable, of th'e accident insurance policies which promise surgical operation mdemnities. The amounts specified are payable if the policy is issued for a weekly indemnity of $25 ; amounts proportionately higher or lower are payable if the policy is issued for a larger or smaller amount. Schedule of Operations. Amputation of : Foot, hand or forearm ■. $ 25 00 Leg, at or below knee 50 00 Arm, above elbow '. 50 00 ™sh ::::::::::: :■.::*.::::: : 100:00 Fingers, one or more entire 10 00 Toes, one or more entire 25 00 Reduction of Dislocation of : Shoulder, elbow, hip, knee or ankle 25 00 Wrist or jaw 1500 Fingers, ojie or more * ! i n no Excision of: ■^"•"" Shoulder, hip, or knee-joint 100 00 Elbow, wrist, or ankle-joint 50 00 Laparotomy: (Opening of the abdominal cavity for ari operation' on any organ contained therein) ^qq qo Incision for: Synovitis (inflammation of the lining membrane of a jointV.*.* 25^00 Injection of: Anti-tetanic serum into frontal lobe of brain. . 100 00 Sequestrotomy : (Removal of dead bone) 3500 417 similar stipulation with, respect to the date of the commencement of the disabling sickness. The medical or surgical treatment indemnity of the accident insurance policy is the counterpart of the medical attendance or medical treatment indemnity of the health insurance policy, usually covering the cost of the treatment provided it does not exceed the amount of one week's benefit. Like some health policies a few accident policies have clauses which make specific provision for total disability resulting from paralysis. In these policies it is provided that if paralysis of a character to produce total disability occurs within ninety days of the date of accident or dur- ing a period of continuous total disability caused by accidental injuries a specified sum shall be paid in addition to the accrued weekly benefit and in lieu of all other indemnity. The amount of the paralysis in- demnity varies in different policies from one-third or one-half to 100 per cent of the principal sum. A number of policies pay the same amount for loss of speech or hearing and a number pay it for insanity resulting from accidental injuries. The "loss of sight" indemnity, which corresponds to the "blindness'^ indemnity in health policies, has already been described. Accident insurance was originally designed to cover the hazards of travel by railroad and steamboat. This original purpose is still shown in many policies by provisions which call for the payment of double indemnities for loss of life, limb, sight or time through accidents of travel. (5) Other Features of Health and Accident Policies. In order to encourage the insured to renew his policy from year to year, or month to month or, in the case of policies on which premiums are payable monthly, to pay his premiums annually or semi-annually in advance, many accident contracts and a few health contracts contain an "accumulations" or "annual increase" clause. In commercial acci- dent policies the clause commonly provides that the principal sum, and consequently the sum payable for death, loss of limb or loss of sight, shall be increased 10 per cent of its original amount each year if suc- cessive premiums are paid annually in advance until the principal sum Reduction of Fracture of : Nose, lower jaw, collar bone or shoulder blade $ 25.00 Breast bone 10.00 Rib or ribs 10.00 Upper arm 35.00 Forearm, one or both bones 25,00 Wrist or hand 15.00 Fingers, one or more 10.00 Pelvis or Sacrum, any of th'e bones of 50.00 Coccyx 10.00 Thig-h 75.00 Knee cap 50.00 Leg bones, one or both 50.00 Foot, two or more bones not toes 15.00 Toes, one or more 10.00 Gunshot Wounds : Removal of shot or bullet 25.00 Skull Trephining : For fracture 100.00 Suturing wounds 5.00 In addition to the operations enumerated above some policies include one or more of the following : abscess, incision of ; aneurism, tying of artery ; eye, ear, nose or throat, any cutting operation; hernia (abdominal), any cutting operation for the radical cure of the reducible, irreducible or strangulated form ; and hydrophobia, Pasteur treatment. —27 H I 418 has been increased by 50 per cent after which tliere shall be no further increases. If premiums are paid semi-annually or^ in some policies, quarterly the clause provides that the rate of increase shall be 5 instead of 10 per cent with. the same maximum aggregate accumulation of 50 per cent. In some of the industrial policies which contain an accumu- lations clause the clause provides that the principal sum shall be in- creased 5 per cent, up to a maximum aggregate of 50 per cent, ^*for each full three months (for each month in some policies) immediately preceding the date of the accident that this policy shall have been maintained in continuous force." In other industrial accident policies and in some commercial accident policies the accumulation feature is applied to the monthly or weekly benefit for disability; sometimes it is also applied to the indemnities specified in the schedule of minor injuries and the schedule of surgical operations. In industrial accident policies in which the accumulation feature is applied to the monthlj^ indemnity the payment of the increased sum is usually a reward for the payment of premiums annually or semi-annually in advance. When the accumulations clause is included in a health policy it is applied to the weekly or monthly disability indemnity, rarely to other indemnities. The "identification indemnity" clause is a feature of many health and accident policies. The clause commonly provides, to quote the language of a typical combination health and accident policy, that "if the insured, by reason of injury or illness, shall be physically unable to communicate with friends, the company upon receipt of a. telegram or other message giving the number of the policy, will immediately transmit to his relatives or friends any information respecting him and will defray the expense necessary to put the insured in the care of friends, within the sum of one hundred dollars."^^ The terms "weekly" and "monthly" as used in describing benefits for disability resulting from accidental injuries or illness have refer- ence merely to the rate of indemnity and do not indicate the time at which, or the frequency with which the payment in question is to be made to the insured. The time or frequency of payment of the dis- ability indemnity may be a matter of great importance to the insured. For that reason the law of Illinois requires that upon request of the insured payment shall be made at least once in every 60 days of half or more of the indemnity which has accrued since the last payment and that any balance remaining unpaid at the termination of the period for which the insurance company is liable shall be paid "immediately upon receipt of due proof."^^ In accordance with the law most policies sold in Illinois provide for the payment of instalments of the disability benefit every 30 or 60 days or the nearest equivalent in weeks or months. The duration of the insurance contract is usually limited to one year in the case of commercial health and accident policies,^ ^ and to one month in the case of industrial policies. The insurance company, how- ever, usually reserves the right to cancel the policy at any time upon 29Sorne policies limit the "identification indemnity" to four times the weekly indemnity ; a number of industrial polices fix it at not to exceed twenty-five dollars. ^Insurance Laws of the State of Illinois, 1917, p. 129 "Accident policies are frequently written for shorter periods, especially policies which cover the hazards of railway travel. j- i^ xu co 419 repayment to the insured of the unearned premium and it permits the insured to renew his polic}' upon its expiration, unless the company- desires to discontinue the risk, by simply paying" the premium for a new term. The purpose of the cancellation privilege is to p^rotect the company against an adverse change in the risk upon which it had not counted in fixing its rates. In deciding as to the eligibility of an applicant for health or acci- dent insurance casualty companies consider his sex, age, color or race, phj^sical characteristics and condition, occupation, place of residence, other health or accident insurance carried by him and the relation between his income and the total amount of weekly or monthly in- demnity which he could claim under all policies which he carries in case he were disabled by illness or accidental injuries. Some companies accept "male risks" only; others accept "female risks" under certain contracts drawn exclusively for women; while still others insure men and women on the same terms. The companies which do not insure women and those which restrict women to special policies claim that there are substantial grounds for discriminating against women, asserting that the recorded experience with female risks is too inadequate to serve as the basis for scientific rates, that it is more difficult to detect malingering and simulation in the case of women than in that of men, that women are more frequently disabled than men or that there is a great moral hazard in the insurance of women against loss of time because disability in the case of women frequently does not influence the amount of income received by them and hence may be used as the basis for what is really an unjust claim f or» indemnity. The age limits within which applicants for health and accident insurance are accepted as policyholders vary for the two kinds of insur- ance and between different companies for the same kind of insurance. Most companies do not accept applicants for health insurance who are less than 18 years of age nor more than 60 or 65 years of age at the nearest birthday; a few, however, accept applicants as young as 16 or 17. The lower age limit for accident insurance is also usually 18 but the upper limit is frequently as high as 70 years. Several casualty companies have reported to the Commission that they consider persons of certain races as undesirable risks but the Commission is unable to state the extent to which casualty companies generally discriminate against wage-earners in Illinois on account of race in soliciting "prospects." The races mentioned by one or more of the companies reporting on this matter as undesirable from an insur- ance standpoint include the Hebrew, Hungarian and Negro jaces, "laborers from Southern Europe," "certain classes of Greeks, Italians and other foreign races," and "foreigners who do not speak English, French, German, or Swedish." The reason assigned for their attitude toward the races named by the companies which stated a reason was that the moral hazard of insuring individuals of these races was too great to make it desirable to accept business from them. The company which referred to "certain classes of Greeks, Italians and other foreign races" as undesirable risks charges that they "often take insurance for 420 speculative purposes rather than for protection" and that the result is the evil of fraudulent claims. The company which mentioned "for- eigners who do not speak English" or one of the other languages named explained that persons in this class often feign a misunderstanding of the contract, that they often lack "moral sensibility/' that they resort to "substitution" (that is, presumably, they attempt to collect insurance for injuries or illnesses sulliered by uninsured persons under policies held by other persons), and that physicians of foreign nationalities are sometimes unscrupulous in making out certificates concerning accidental injuries or illnesses for members of their own race. Health and accident insurance companies do not, like life insurance companies, require a medical examination of all applicants for insur- ance but limit such examinations to applicants who appear from their applications or other evidence to be physically of doubtful desirability as risks. The reasons for this practice have been set forth as follows by a physician who has served as a medical examiner and adjuster for accident insurance companies: "Medical examination * * * of each individual applicant for health or accident insurance has not found favor among accident com- panies for several reasons. First, because of the expense, the addition of two or three dollars in examiners' fees to the cost of securing a policy appearing to the underwriters as an unnecessary burden. Second, owing to the fact that accident policies are based upon a schedule of warranties or statement of facts in the application which becomes the assured's contract with the company and upon the truth of which the policy is issued, medical examination, by such examiners as are now available, not only fails to help materially in the estimation of a risk, but may prove the means of depriving the company of the ability to avail itself of a defense of breach of warranty in certain cases wh^ such defense might prove invaluable in the prevention of imposition. Third, the adoption of universal examinations by the accident com- panies as now practiced in life insurance, would lead, no doubt, to legislation and court decisions calculated to limit the right of cancella- tion by the companies, for it is but reasonable to suppose that the inauguration of the plan of examining all risks would, naturally, be met by the demand that the policy be maintained in force to the end of the term for which it was originally issued. Fourth, the report fur- nished by the average examiner seldom conveys to the experienced accident underwriter information which is in any way comparable to what he can acquire through bureau records, inspection reports, corre- spondence with other companies, his own ability to read between the lines of an application and, in the event of claim, through the informa- tion obtained from the claim department and the careful scrutiny of the claim papers. Fifth, owing to the present plan of appointing medical examiners * * * their reports of examinations prove of little service and are often positively ludicrous when seen through the eyes of the experienced home office underwriter. Sixth, the general examination of applicants for accident and health insurance would 421 increase the difficulty of securing new business and lead to trouble with the agency force."^- The occupation of an applicant for accident or health insurance is a factor of prime importance in determining his eligibility for insur- ance as well as the rate of premium which he will have to pay if he is given the insurance for which he is applying. Comparatively few occupations, however, are classed as"not insurable;" the "Accident In- surance Manual" for 1918 so classes only about 70 occupations among the three or four thousand included in its classification of occupations.^^ The other occupations are graded according to the hazards which they are believed to involve, as described in a later part of this report, and a premium rate believed to be sufficient to cover the hazard is adopted as the basic rate for each occupation. This rate, it should be noted, may be high enough for certain of the more hazardous occupations virtually to put them in the "not insurable" class for workingmen receiving average or less than average wages. Place of residence may be an important factor in determining the eligibility of an applicant for health insurance but so far as the Commission could learn casualty companies in Illinois do not as a rule discriminate against applicants for insurance or "prospects" on the ground that they are residents of a particular town, city, county, or section of the State ^but base such discriminations as they may make with regard to residence upon conditions which exist in the immediate environment in which the applicant or "prospect" lives. One company, however, informed the Commission that it had found it advisable to restrict its health insurance business in East St. Louis and Granite City, "both from a health and moral standpoint." In order to prevent "over-insurance" and the temptation to simu- lation, malingering and fraud which over-insurance is likely to create, casualty companies require applicants for health or accident insurance to state in their applications certain details as to other health and accident insurance which they may carry or for which they have ap- plied. For the same reason the companies require applicants either to state in their applications that their income per week or month exceeds the gross amount of weekly or monthly indemnity payable under all policies carried by them or to specify the exact amount of their income. As, a further safeguard against over-insurance resulting from the taking out of several policies in the same company or in different companies many policies now contain the following provisions authorized bv the Standard Provisions Law (Insurance Laws of the State of Illinois, p. 131) of 1915: "17. If the insured shall carry with another company, corporation, association or society other insurance covering the same loss without giving written notice to the insurer, then in that case the insurer shall be liable only for such portion of the indemnity promised as the said ^W. Edward Magruder, M. D., in chapter on "Medical Examinations" in Dun- ham's Business of l7isurance. Volume II, pp. 105-106. 23 The Spectator Company's Accident Insurance Manual for 1918, pp. A3-A66. The following- are typical of the occupations classified as "not insurable" : acid maker, sulphuric, user or custodian of ; army officer, war service ; cartridge maker ; common sailor, lake or ocean ; dynamite maker ; electric line man ; current on ; jockey ; prospect mining. 422 idemnity bears to the total amount of like indemnity in all policies covering such loss, and for the return of such part of the premium paid as shall exceed the pro rata for the indemnity thus determined/' '^19. If a like policy or policies, previously issued by the insurer to the insured be in force concurrently herewith, making the aggregate indemnity for loss of time on account of disability in excess of $ weekly, the excess insurance shall be void and all premiums paid for such excess shall be returned to the insured/' The precautions just described make it possible for the insurance companies to limit the insurance granted applicants in the great ma- jority of cases to an amount less than the income of the applicant; nevertheless, it is stated by representatives of some of the companies that the evil of over-insurance has not yet been eliminated and that legislation is needed to control the evil. (6) The Cost of Casualty Company Insurance, The merits of casualty company insurance as a means of meeting the need of wage-earners for health and accident insurance depend to a considerable extent upon its cost to the insured. The cost depends partly upon sickness and accident hazards and partly upon the business acquisition expense, the expense of management and loading for profit. The assets of a prudently managed company are greatly increased through the judicious investment of its funds. The premium receipts and investment earnings comprise its loss and expense fund. The busi- ness of the casualty companies is organized upon a highly competitive profit-seeking basis.^"* As so organized the business depends for its sales upon the employment of a large sales force who possess relatively high qualifications as salesmen and can therefore command relatively large remuneration. It is a commonplace among insurance agents that health and accident insurance is sold, not bought. "Nobody buys it over the counter. It must be explained, and the one who needs it must be interested and convinced of that which really is essentially a necessary of life.''^^ The work of "explaining'' health and accident insurance to the public as it is done by solicitors for the casualty companies is neces- sarily a costly business. Most persons solicited do not purchase insur- ance; "statistics show that one out of every ten prospects" properly approached becomes a policyholder."^^ This means that the policy- holders of an insurance company must pay not only for their own education as to the merits and service of the insurance which they pur- chase but also for the expensive attempts made to educate those who do not buy. A considerable part of the so-called educational activities of health and accident insurance agents is directed, moreover, not toward the diffusion of a knowledge of the general principles of these classes of insurance but toward the creation of a belief that the policies of this or that company are better bargains than the policies of all other "Exception to the use of the term "profit-seeking" should perhaps be made in the case of the mutual companies. The term is not employed in an invidious way. "Business" is primarily "profit-seeking." »« The Spectator's Company's Accident Insurance Manual, for 1918, p. 4. " Same, p. 5. The italics are the present writers. 423 companies. There is much duplication in the efforts of agents; persons who purchase health and accident insurance are frequently solicited several times by each of several agents representing different companies having practically identical policies to sell.^^ The policyholders pay not only for the genuinely educational activities of health and accident insurance agents but also for their purely competitive struggles for "prospects." The competition which has prevailed in the health and accident insurance business in the past has been advantageous to policy- holders in a number of respects. It has been a potent factor in liberal- izing policies, although not, as is sometimes assumed, the only factor, and it may have hastened the present development of the business. The following table compiled from recent annual reports of the Insurance Superintendent of the State of Illinois^^ shows the relation which exists between the premiums paid in Illinois to the casualty com- panies and the losses paid by them in Illinois. HEALTH AND ACCIDENT INSURANCE PREMIUMS RECEIVED AND LOSSES PAID IN ILLINOIS BY CASUALTY COMPANES, 1913-1917, INCLUSIVE. Year. Premiums received. Losses paid. Ratio of premiums received to losses paid — per cent. 1913 $ 3,003,063 3,013,418 3, 150, 162 3,489,330 3,848,485 $1,176,929 1,367,665 1,245,806 1,509,777 1,891,894 39. 19 1914 45.39 1915 . . 47.93 1916 : 43,27 1917 49.16 Total for 5 year period, 1913-1917 $16,504,458 $7,192,071 43.58 The comparison here made is not entirely fair. With an expand- ing business of course the casualty company must carry a reserve to cover its heavier claims in the future. Yet this reserve requirement is a factor of minor importance in explaining the disparity between pre- miums received and losses paid during these years. The acquisition expense of the business (largely commissions paid agents) accounts in large part for the fact that the casualty companies returned to health and accident policyholders during these years less than half the amount of money collected from them in premiums. "The agent^s commission," the Spectator Company says in its "Accident Insurance Manual" for 1918 (page 7), "is usually ten or twelve times as much as the com- pany's underwriting profit." The same authority states (page 4) that "relatively the commissions paid to the sellers of Income Insur- ance (and that is what health and accident benefits really are) are higher than are paid to salesmen in any other legitimate calling" and " "Remember every one who you find has already provided himself or herself with 'Income Insurance' was doubtless solicited, not once but several times, by not one but several solicitors lilce yourself. Many policyholders turned down a dozen men once and one man a dozen times, until the rig'ht salesman sold him the policy he has today." The Spectator Company's Accident Insurance Manual for 1918, pp. 6-7. ^Insurance Reports Illinois 1914, Part IIL p. 6 ; 1915, Part III, p. 6 ; 1916, Part III, p. 7 ; 1917, Part III, pp. 7-8 ; 1918. 424 calls attention to the fact that "the renewal commissions, that is, the compensation paid to those who have originally sold this * * * necessary of life and who have 'placed the annual or semi-annnal re- newal of the contract/ are constant — not reduced, as in other forms of insurance." Of 36 companies filing statements with the Insurance Department of Wisconsin in 1916, 20 paid no commissions in that state less than 25 per cent; 11 of the 20 paid no commissions less than 30 per cent; and 5 paid a uniform commission of 35 per cent. One of the 20 com- panies paid commissions ranging from 30 to 50 per cent; 6 paid com- missions ranging from 25 to 35 per cent; and one paid commissions ranging from 25 to 33i^ per cent. Sixteen companies, as indicated by the foregoing, paid some commissions of less than 25 per cent but 14 of these companies also paid some commissions of 25 per cent or more — one company ranging as high as 371/2 per cent, three others as high as 35 per cent, two others as high as 33^3 per cent, and three others a^ high as 30 per cent. The two companies remaining in the sixteen paid commissions of from 15 to 20 per cent plus the policy fee, which may make the maximum compensation more than 25 per cent in most, if not all, cases. The lowest commission reported by any of the thirty-six companies first mentioned was .71/2 per cent. This was paid by one company whose maximum commission is 35 per cent. Five companies report minimum commissions of 10 per cent with maximum commissions of 30 per cent or more. In some cases the minimum commissions mentioned appear to have been paid for the writing of group policies but the Commission is unable to state whether or not this is true in all cases. The explanation of the great variation in the commissions paid agents is to be found partly in differences in the territory and business of different agents and partly in the exigencies of the competition for agents which prevails among casualty companies. The following quota- tions from the secretary of an Illinois company will suggest the nature of this competition: "The easiest thing in the world is to get agents, but after a few weeks' trial it dawns on the new manager that there are agents and agents, but what he needs is men who will produce applications. Some inducement in the way of extra compensation, extended territory, of which he has much to give, or the held-out proposition of advancement with a new company will secure from agencies of larger concerns an initial force of application producers for a small company .''^^ "The best managed company with the most loyal force of agents will frequently find that its business is being transferred to another company, for it is one thing to secure a good agent, another to hold him against all the allurements offered by other companies, the most enticing of which is an excessive compensation for his work, and the manager must determine from the agent's past record whether or not he can meet the offer of the othei: company."*^ w Alfred E. Forrest, secretary North American Accident Insurance Company, in chapter on "Agency Management" in Dunham's Business of Insiirance, Vol. II, p. 96. «Same. pp. 100-101 425 Data relating to net premiums collected and agents' commissions and brokerage were obtained for 1917 from the statements filed by 57 companies with the Insurance Department of this State. These data, which are for the entire business of the companies and not merely for the business in Illinois, indicate that 35 companies reporting health in- surance separately received an aggregate of $9,925,041.55 in net pre- miums and paid commissions and brokerage totaling $2,756,799.37, or 27.78 per cent, and that 22 companies reporting health and accident insurance combined received an aggregate of $13,744,294 and paid commissions and brokerage totaling $4,100,018.15, or 29.8 per cent. Health and accident insurance policies differ so much in their pro- visions that it is difficult to make a satisfactory summary statement showing the accounts of the premiums charged for them. At the same time the limitations of space do not permit detailed descriptions of policies in explanation of differences in premiums. It must suffice therefore to say that a commercial disability policy, covering both ac- cident and sickness hazards, which provides for the payment of a princi- pal sum of from $5,000 to $7,500 and a weekly indemnity of $25 is likely to cost a "select" risk about $60 per year,'^^ varying more or less from this amount according to the features included in the policy. It is impossible to make even as general a statement as the foregoing with respect to industrial disability policies because of the greater variation in their provisions. The following table, which shows the rates charged by a certain company for a fairly tj^ical industrial policy, will, how- ever, be useful for purposes of illustration.*^ (Table next page.) It will be observed that the cheapest policies available according to this table cost $3 the first month and $1 per month thereafter, making a total of $15 the first year and $12 every year the policy is continued after the first y§ar until age 51 is reached.*^ In Class I the premiums mentioned will purchase a policy which provides for a monthly benefit of $60 for sickness or accident and a principal sum of $600 pay- able for accidental death or the loss of any two limbs or both eyes. In Class 2 the benefit purchasable for the premiums mentioned are, re- spectively, $10 and $100 less than in Class 1 and the reductions in bene- fits continue from class to class, although not always at the same rate, until the final class (Class 9) is reached. In Class 9 a payment of $3 the first month and $1 per month thereafter will pay for benefits of bnly $15 per month for sickness and accident disability and only $100 for accidental death or loss of any two limbs or both eyes. In explanation of the difference in the indemnities provided in re- turn for a given premium it should be said that the classification indicated in the table reproduced above is based upon occupations. Applicants for health and accident insurance are classified by casualty companies according to Avhat is assumed to be the relative sickness and accident "See the Spectator Company's Accident Insurance Manual for 1918 for data concerning policies issued by the principal accident' and health insurance companies of the United States. *2 The rates shown apply only to men between the ages of 18 and 50 inclusive. The rates for men between the ages of 51 and 60 inclusive are computed by adding 10 per cent to the rates shown for each year over 50. The age limit is 60. Women are insurable under this policy for an indemnity not exceeding $50 per month and in no case covering the first week of sickness at rates one class lower than the classification for men in the same occupation. *' See preceding note. 426 MONTHLY PREMIUM HEALTH AND ACCIDENT POLICY- INTDEMNITIES ANT) RATES. -TABLE OP (The Rates for the First Month Include a Policy Fee of $2.) Indemnity and Cost in Indemnity and Cost in Class 1. Class 6. « Monthly accident and sickness indemnity. Accidental death or loss of any two limbs or both eyes. $60.00 70.00 80.00 90.00 100.00 125,00 Cost per month. Initial or first month. Suc- ceeding months. Class 2. Class 3. Class 4. "First week of sick- ness" rider (addi- tional). $600.00 $3.00 $1.00 700.00 3.25 1.25 800.00 3.50 1..50 900.00 3.75 1.75 1,000.00 4.00 2.00 1,500.00 4.50 2.50 $0.60 .70 .80 .90 1.00 1.25 $ 50.00 $ 500.00 $3.00 $1.00 $0.50 60.00 600.00 3.25 1.25 .60 70.00 700.00 3.50 1.50 .70 80.00 800.00 3.75 1.75 .80 90.00 900.00 4.00 2.00 .90 100.00 1,000.00 4.25 2.25 1.00 120.00 1,200.00 4.75 2.75 1.20 $40.00 $400.00 $3.00 $1.00 $0.45 50.00 500.00 3.30 1.30 .55 60.00 600.00 3.60 1.60 .65 70.00 700.00 3.90 1.90 .80 80.00 800.00 4.20 2.20 .90 90.00 900.00 4.50 2.50 1.00 $35.00 $3.50.00 $3.00 $1.00 $0.45 40.00 400.00 3.20 1.20 .50 50.00 500.00 3.50 1.50 .60 60.00 600.00 3.85 1.85 .70 76.00 700.00 4.20 2.20 .80 80.00 800.00 4.50 2.50 .90 Class 5. $30.00 $300.00 $3.00 $1.00 $0.40 35.00 350.00 3.25 1.25 .50 40.00 400.00 3.50 1.50 .60 50.00 500.00 3.90 1.90 .70 60.00 600.00 4.35 2.35 .80 Accidental death or loss of any two limbs or both eyes. Cost per month. Monthly Accident and sickness indemnity. Initial or first month. Suc- ceeding months. "First week of sick- ness" rider (addi- tional). $25.00 30.00 35.00 40.00 50.00 60.00 $250.00 300.00 350.00 400.00 500.00 600.00 $3.00 3.25 3.50 3.75 4.25 4.75 $1.00 1.25 1.50 1.75 2.25 2.75 $0.35 .40 .50 .60 .70 .80 $15.00 20.00 25.00 30.00 35.00 40.00 50.00 Class 7. $20.00 $100.00 $3.00 $1.00 $0.30 25.00 100.00 3,30 1.30 .35 30.00 150.00 3.60 1.60 .40 35.00 150.00 3.90 1.90 .50 40.00 200.00 4.20 2.20 .60 50.00 250.00 4.75 2.75 .70 60.00 300.00 5.35 3.35 .80 Class 8, $20.00 $100.00 $3.00 i $1,00 25.00 100,00 3.40 1,40 30.00 100.00 3,75 1.75 35.00 100.00 4.10 2.10 40.00 100.00 4.50 2.50 50.00 100.00 5.00 3.00 Class 9. $100.00 $3.00 $1.00 100.00 3.50 1,50 100.00 4,00 2.00 100.00 4.50 2,50 100.00 5.00 3.00 100.00 5,50 3,50 100.00 6.50 4,50 $0,30 ,35 .40 .50 ,60 .70 $0,25 ,30 .35 .40 .50 .60 .70 427 hazards of the occupations in which the}^ are engaged.** Class I in the table includes occupations which are believed to be less hazardous. If all wage-earners had occupations listed in Class 1 or in the first two or three classes the problem of health insurance would be a less difficult one than it is, for adequate health insurance would then be more nearly within the reach of the average wage-earner. But the first two classes*^ are almost entirely made up of the occupations of business and professional men, their salaried employees and certain salaried em- ployees of the federal, state, or city governments. Class 3 is almost entirely made up of the occupations of business and professional men, salaried employees and skilled workmen. The occupations of the great majority of wage-earners are classified in Classes 4 to 9 inclusive, which require the highest health and accident insurance premiums. In general it ma}" be said that health and accident insurance premiums are highest for those occupations which are most poorly remunerated. The follow- ing table showing the classification of certain occupations in the Specta- tor Company^s "Accident Insurance Manual" for 1918 is offered in support of this conclusion.*^ ** Accident hazards appear to have greater weight as a rule than sickness hazard? in determining the classification of a given occupation. *^ The data here presented with respect to the classification of occupations are derived from the classification in the Spectator Company's Accident Insurance Manual jor 1918. ^« The Manual explains its classification as follows (p. A2) : "Each $1,000 of Insurance carries with it $5 weekly indemnity unless otherwise specified. * * *. Occupations are classified by letter, numeral and title, following, prevailing practices of various companies. The classification "A Special" is herein entitled "Select." The classification "Extra Medium" is herein entitled "Special." The classification "Sub Standard" is herein entitled "Hazardous." The classification "Perilous" is herein entitled "Special Hazardous." The classification "Extra Peril" is herein entitled "Extra Special Hazardous." The numeral 2, herein adopted, signifies classification "BS," or "Extra Pre- ferred." As used in this Manual, the following table shows the designations which signify the same classificaton of risks. Al Select. D 4 Medium. F7 Extra Hazardous. B2 Preferred. DS5 Special, G8 Special Hazardous. C3 Ordinary. E 6 Hazardous. H9 Extra Special Hazardous. Limit of Occupation.* Class. risk. Agricultural laborer (farm hand) F 7 Extrahazardous.. $ 1,000 Asphalt floor or street layer DS 5 Special 1, 500 Baker, driving wagon D 4 Medium 2,000 Baker, shop and counter work only C 3 Ordinary 3,000 Beef handler, in warehouse D 4 Medium 1,500 Boiler maker DS5 Special 1, 500 Can maker D 4 Medium 2,000 Can maker, not using die t C 3 Ordinary 3,000 Cannery, packer, solderer or boiler C 3 Ordinary 2,000 Car builder, shoj) work only DS 5 Special 2,000 Car repairer, in yards E 6 Hazardous 1,500 Car repairer, shop work only DS5 Special 2, 000 Carpenter, framing, not bridge carpenter E 6 Hazardous 2,000 Carpenter, shop work, using machinery E 6 Hazardous 1,500 Carpenter, inside or shop work only, not using machinery D 4 Medium 2,500 Cigar or cigarette maker C 3 Ordinary 2,000 Delivery wagon driver, light parcels only D 4 Medium 2,000 Drayman, not teamster in woods E 6 Hazardous 1,500 Engineer, stationary engine D 4 Medium 2,500 Gasfitter D 4 Medium 2,000 Grocery plerk, delivering goods or soliciting orders with wagon.. D 4 Medium 2,000 Groceryclerk, not delivering foods or soliciting orders with wagonC 3 Ordinary 3,000 Grocery clerk, counter duties only (large city store) B 2 Preferrea 3,000 * In considering this table the large proportion of wage-earners who fall under the classification of common laborer must be borne in mind. The fact that the occupations of most business men, professional men and salaried persons fall under the first three classifications shown in Note 2, p. 53, also re-inforces the statement that in general health and accident insurance premiums are highest for those occu- pations which are most poorly renumerated. 428 f It is evident from the forgoing data that the purchase of health and accident insurance from a casualty company imposes a relatively heavy financial burden on the wage-earner — a burden which is, in fact, so heavy that the great mass of wage-earners do not purchase the insurance at all. It is therefore in point to enquire if it is not possible to reduce the premiums on this insurance to a level which will place the protection within the reach of wage-earners generally and induce them to purchase it in amounts adequate to their needs.*^ In considering this question it is necessary to divide the premium into two parts^the net premium and the loading — and to consider each part separately. The net premium of a policy is the amount assumed to be necessary with accrued interest to pay that polices share of the accident and sickness claims which the insurance carrier must meet. The loading is the amount added to the net premium to provide the margin from which the company is supposed to pay its costs of doing business and dividends on its stock (if it is a stock company) and pro- vide for contingencies. In practice a company may pay part of its costs of doing business and part of its dividends from savings in the net premiums it collects arising from a sickness and accident experience which is more favorable than the experience assumed in calculating the net premiums. The net premium depends upon the sickness and accident experience and the rate of interest on invested funds assumed by the company in calculating its rates. If this experience corresponds fairly closely with the actual experience of the company the net premium can only be re- duced by increasing the rate of interests on investmenis or decreasing the amount and severity of the disability from accidents and sickness suffered by policyholders of the company. The possibility of decreasing the amount and severity of disability from sickness among wage-earners is considered elsewhere in this report.*^ An important question is, cannot the acquisition cost which is such an important factor in determining the cost of this insurance, be materially reduced. Several answers have been suggested to this question. One of these, the group insurance plan under which wage-earners are insured in groups by their employers instead of individually at their own expense and at Hat or cap maker C 3» Ordinary $ Hod carrier E 6 Hazardous Laborer, common (state nature of work) E 6 Hazardous Lathe hand DS 5 Special...."!!;!!! Laundryman c 3 Ordinary Machinist DS 5 Special. Molder, pourer E 6 Holder, not pourer : !!!! DS5 Motorman , street railroad : ! ! ! ! ! D 4 Packing house employees (8 occupations) C 3 Packing house employees (15 occupations) D 4 Medium.!!!!!!!!! l! 500-3,' 000 Packing house employees (5 occupations) DS 5 Special 1^000-2^000 "The suggestion made in some quarters that the general wage level be in- creased so that wage-earners may be able to purchase casualty company insurance SL^f1.?Kff^^?o^°y '^ interesting but of little value in view of the fact that no ?S|gesttoi increasing the general level of wages is presented with the *' Part I, Ch. I, Section 9 ; also Ch, II. 2,000 1,000 1,000 2,000 2,000 2,500 2,000 2,000 2,000 Ordinary 2,000-5,000 6 Hazardous . Special.. Medium. 429 premiums reduced in view of the reduced cost of getting and handling the business, will be considered in the report on group insurance.*^ Another suggestion is that health insurance be sold by life insur- ance companies in connection with life insurance. Mr. Miles M. Dawson in urging this plan argues that insurance against loss of time by sick- ness or accident "is essentially a part'' of life insurance and that "in connection with a life insurance policy, it is possible to furnish at a much lower cost, because of lower expense in the payment of commis- sions, indemnity for the whole course of the disability, renewable with- out increase of premium and at the option of the insured.^' The policies sold by casualty companies, Mr. Dawson says, "are subject to * * * serious objection'^ among which is the fact that "the premiums contain a large surcharge of expense, the same commission being paid to agents each year.'^^^ A third suggestion for reducing the cost of providing health and accident insurance is that the casualty companies sell these forms of insurance on the level premium, non-cancellable, continuing policy plan instead of on the annual or monthly contracts now used.^^ If this suggestion were adopted policies would be offered which would continue in effect until the insured reached, say, age 65 and on which the annual or monthly premium would remain the same throughout the life of the policy. The advantages of the plan as respects the cost of insurance would appear in the saving in the renewal commissions paid agents, 'because, as is the case in life insurance, the agent would have little, if anything to do in the premises; a loading of 30 per cent (of the net premium) should be ample to meet all proper expenses."^^ One of the leading advocates of this plan asserts that it is "sure to come — probably sooner than many of us now think possible — ^and it will give tremendous impetus to the business transacted by the companies.'^^^ Several attempts have been made to apply the second plan in whole or in part. In the early history of industrial life insurance in the United States insurance against sickness was combined with insurance against death. This experiment was a failure. "Experience proved,^' says Mr. John F. Dryden, late president of the Prudential Insurance Company of America, in explanation,^^ "that under present conditions the operations of an Industrial company must of necessity be limited to the assurance of a sum certain payable at death, while the assurance of a stipulated sum during sickness can only with safety be transacted, and then only in a limited way, by fraternal organizations having a perfect knowledge of and complete supervision over the individual members.^^ * * * Accordingly, after a few years the business was *9 See Part II, Special Report IX. "The quotations in this paragraph are taken from pp. 244-245 of The Business of Life Insurance, published in 1905, by Miles M. Dawson, Consulting Actuary, Actuary of the New York Legislative Committee for the Investigation of Life In- surance, etc. Mr. Dawson's other objections to casualty company health and accident insurance are stated later in this report. "iReinard S. Keelor, M. D., Liability Underwriter United States Casualty Com- pany and former secretary Philadelphia Casualty Company, in chapter on "Sickness Insurance" in Dunham's Business of Insurance, Vol. II, pp. 123-126. "Same, p. 126. 53 Same, p. 124. " Addresses and Papers on Life Insurance and Other Subjects, by John F. Dry- den, pp. 31-32 and 38. ^ Mr. Dryden overlooked the commercial success of a number of casualty com- panies in the field of health insurance at the time (1903) he wrote this statement. 430 limited to the insurance of a sum certain payable at death/' Accident insurance which provides indemnities against accidental death is a "limited form of life insurance/' as it has been called, as is also the relatively small amount of health insurance sold in Illinois on policies which provide for the payment of funeral benefits.^^ Attention should also be called to the fact that some life companies engage in the health and accident business. A few life insurance companies now offer com- bination policies providing insurance against death, sickness and acci- dent, but it would appear that only a few such policies have been written. Another suggestion is that if this insurance was written on a few standardized forms provided by law, there would be a clearer under- standing of rights by the insured and less dissatisfaction over the dis- position of claims. A greater degree of satisfaction on the part of the insured, however secured, would increase the volume of insurance written by the agent and reduce the acquisition cost and the premium charge. (7) Possibilities of Casualty Company Insurance as a Solution for the Health Insurance Problem of the Wage-earner. It should be evident from the preceding pages of this discussion that casualty company insurance has not yet reached a stage of develop- ment where it can be accepted as an agent of great importance in meet- ing the need of the great body of wage-earners in Illinois for health insurance. Nevertheless casualty company insurance may have possi- bilities of further development which may make it more serviceable in this particular. The fact that this might prove to be true is indeed the principal reason which led the Commission to make a detailed investi- gation of this type of insurance. Casualty company health insurance is a comparatively new form of insurance. Although a number of companies were organized in the United States for the purpose of writing health insurance prior to 1850, when two of these companies were authorized by the legislature of Massachusetts to write accident insurance as well as health insurance," health insurance as it is sold to-day by casualty companies developed as a feature of accident insurance. The pioneer health insurance com- panies appear to have failed and retired from both the health and acci- dent business because of poor selection of risks, loosely worded contracts and serious errors in the calculation of premium rates.^^ The accident insurance business was revived in the 1860's following the chartering in Connecticut of the Travelers Insurance Company in 1863 and the appearance shortly after of a number of rival companies^^ and it has had a continuous development since then. "The business of sickness insurance in the United States (after the pioneer period referred to above) lapsed into a condition of innocuous desuetude, relieved only by the sporadic attempts of a few life insurance companies in the decade following 1860, to create an interest in such insurance, until about 1894, when a little rider, covering only eight zymotic diseases and attached 66 See p. 483. 87 Sylvester C. Dunham, former president of the Travelers Insurance Company, in chapter entitled "Historical Sketch" in Dunham's Business of Insurance, Vol. II, pp. 8-9 and Remard S Keelor, M. D. in chapter on "Sickness Insurance" in the same work. Vol. II, p. 121. "Same reference, pp. 11 and 121, respectively. "Same reference, pp. 11-15. 431 as an adjunct to accident policies, made its appearance, and from this rider, by the process of gradual evolution, sickness insurance as we now know it, took its rise. Beginning cautiously (and very properly so), with a separate policy covering a limited number of diseases * * * stress of competition soon caused the list of named diseases to be grad- ually extended, until finally the policy covering any sickness made its appearance/'^^ Accident insurance in the United States thus has a continuous history of more than half a century while health insurance has a con- tinuous history about half as long. The development of these two types of insurance is characterized by an increasing liberalization of policy contracts, the growth of an improved technique for the prevention and detection of malingering and simulation and the placing of the health and accident insurance business generally upon a sound, profit-making basis for the investor. Policy contracts have been liberalized in two ways: first, by the inclusion of more generous and more numerous indemnities — a matter which has been sufficiently discussed in preceding pages — and secondly, by the elimination, by certain companies which formerly used them, of provisions designed unfairly to discourage the presentation of claims or prevent their collection when presented. The president of a casualty company, writing six or seven years ago, describes the unfair contracts formerly used by some of the com- panies selling industrial health and accident insurance as follows : ^'The primary object of this sort of protection was and should be, to provide an income to the wage-earner when his wages are cut off by unfortuitous circumstances. The principal object of the first under- writers seemed to be the production of something that could be sold. Therefore, in order to furnish a marketable commodity they sought to issue a policy at a popular price and the almost universal price was $1 per month. The attempt was made to confine the benefits promised to what a dollar would pay for, but lack of experience made it prac- tically impossible to determine with any degree of accuracy just what could be promised for such a premium, having in mind the great diversity in the occupations and habits of the insured; and as the com- petition increased, greater and more fanciful promises were made until the policy became more of a literary and insurance monstrosity than the product of scientific underwriting. As one company would add a liberal provision to its policy, the other companies would try to outdo it, until finally the policies were so prepared that it would require a mathematician to determine what, if anything, a policyholder was en- titled to in case of a claim. The policy would provide for a certain amount of indemnity in case of accident or sickness, then in some hidden clause there would be a provision that only a fraction of the amount promised would be payable under certain conditions and a different fraction under slightly different conditions, and so on, imtil a study of the policy forms in general led one into a maze from which he was' only able to extricate himself by giving the matter up in disgust. This condition existed until within a very few years, when by the aid of *" Keelor, in Dunham's Business of Insurance, Vol. II, pp. 121-122. 432 accumulated experience, the disadvantage and undesirability of these added curiosities became apparent and it was soon demonstrated that the companies must prevent the loss which a liberal construction of such policies would entail. This was attempted by cutting down the claims and refusing payment on the slightest technicality/'^^ if The Standard Provisions laws enacted in a number of states have been a material aid in eliminating unfair and misleading provisions in accident and health insurance contracts and in standardizing the pro- visions which are now used. Limitations of time and space forbid a detailed discussion of the Standard Provisions Law of Illinois/^ but the main outlines of the law may be briefly described. This law pro- vides, among other things, that all accident and health policies "shall contain certain standard provisions,'' fifteen in number, the phraseology of which is set forth in the law and which must be followed exactly word for word. These provisions prescribe the documents which are to constitute the contract of insurance, the method of reinstating the policy after lapse, the time within which the insured must file notice of claim with the company, what shall constitute sufficiency of notice of claim with the company, the method and time within which the insured must furnish proof of loss to the company, the method and time within which the company must pay the indemnities due the insured, the rights of the beneficiary under the policy, and the time within which suit may be brought upon the policy. The required standard provisions also define the right of the company to examine the person of the insured during the pendency of a claim and to make an autopsy in case of death and the right of the insured upon change to a less hazardous occupation to demand and obtain the cancellation of his policy and the return of the unearned premium upon it. In addition to the standard provisions which all accident and health policies must contain, the Standard Provisions Law of Illinois prescribes certain "optional standard provisions" which must be used if the policy contains any provisions governing the subject matter of these so-called optional provisions. The section of the law which prescribes the optional provisions reads in part as follows: "No such policy shall be so issued or delivered which contains any provision (1) relative to cancellation at the instance of the insure/; or, (2) limiting the amount of the indemnity to a sum less than the amount stated in the policy and for which the premium has been paid; or, (3) providing for the deduction of any premium from the amount paid in settlement of the claim; or, (4) relative to other insurance by the same insurer; or, (5) relative to the age limits of the policy, unless such provisions which are hereby designated as optional provisions, shall be in the words and in the order in which they are hereinafter set forth, but the insurer may at its option omit from the policy any such optional standard provision."®^ •* Reinhold R. Koch, president American Assurance Company, in chapter on "Industrial Accident and Health Insurance" in Dunham's Biisiness of Insurance, Vol. II. pp. 138-139. ^Insurance Laws of the State of Illinois, 1917, pp. 125-134. This law went into effect January 1, 1916. ** Insurance Laws of the State of Illinois, 1917, p. 130, section 4. 433 The problems arising from fraudulent claims, malingering and the simulation of- injuries and disability are serious problems which will have to be faced under any form of health and accident insurance so long as human nature remains substantially as it is at present con- stituted. The casualty companies have had valuable experience in deal- ing with these problems and this experience should be utilized in any attempt that may be made to secure a more general use of health and accident insurance by wage-earners or others. The nature of the prob- lems, some of the means used by casualty companies in meeting them and other means which have been proposed may be set forth most accu- rately by quoting from . statements made by officials of casualty com- panies who have written on the subject: "Policies have been obtained with the intent to defraud," says the president of a casualty company. "Few companies have remained im- mune to these attempts. * * * So skillful were some that they ended in success. At times, murder and suicide enter into the scheme, but usually it takes the form of self-mutilation. Strange as it may seem to a normal mind, men actually do shoot off a hand or a foot, or destroy the sight of an eye for the sole purpose of collecting indemnity from an accident insurance company. * * « Ii^ many instances persons of eminent respectability make excessive claims utterly oblivious of inten- tional wrong-doing. They may be charitably designated as ^uncon- scious malingers.^ Some otherwise fair-minded persons pervert the meaning and intent of the contract provisions and maintain that their claims should be paid because to disapprove them is to impeach their integrity. Not infrequently the agent who secured the risk writes to his company that his business will be ruined if a particular claim is not paid; while many insurants and some agents imagine that to whisper the words, ^man of influence in the community,' is sufficient to cause the company to abandon well settled principles in claim adjustment. It must not be thought * * * ^^lat the percentage of dishonest claims is large; quite the contrary; the overwhelming majority of claims presented are honest. Yet the dishonest and exorbitant claims cost time and money ."^* "The most important single element in the consideration . of acci- dent and health claims by insurance companies is the unfavorable atti- tude of the attending physicians, as they alone can, without injvistice, be held responsible for inspiring nearly all of the claims which prove troublesome to insurance companies, either through suggestion or as a result of their strong desire to please rather than arouse the opposition of those from whom they gain their livelihood. The extremes to which medical men of unquestioned standing and ability will go in order to assist their patients in the collection of claims against insurance com- panies is really appalling. In many instances, claims which would not come to the attention of the companies, except through the assistance and ingenuity of the family doctor, are so well prepared to meet the "* Edson S. Lott, president U. S. Casualty Company, in chapter on "Premium Rates" in Dunham's Bit,siness of Insurance, Vol. H, pp. 49-50. It will be noted that Mr. Lott is speaking- of experience with accident insurance only. —28 H I 434 requirements of the policy that many of them are paid by the claim departments without question. "It is only fair to say, in behalf of the attending physician that, although he is to a greater or less degree responsible for every case in which the companies are imposed upon by claimants, under accident or health policies, he almost always renders this service to his patient without the thought of any direct financial benefit to himself. He makes the mistake either through his desire to accommodate his patient and avoid the trouble of a conflict with him over what appears to be trivial matter, or he has learned by experience that, in order to hold his practice, he must comply with the wishes- of his patients in the filling of claim blanks, wherever possible, under penalty of having them go to some competitor who will give them the service which they desire. * * * "The attorneys who prey upon insurance companies and corpora- tions and are conspicuous for their activity both in securing the claims of individuals for collection and in the methods to which they resort for the accomplishment of their purposes, could not exist without the aid of the medical men for, without the certain knowledge that they can always find one or more physicians in each community willing to go on the witness stand in support of almost any contention they may make, they would immediately lose their activity and efficiency as re- sourceful damage suit lawyers. * * « "The time is probably near at hand when the companies will have to give more attention to personnel and training of their medical exam- iners for, with the existing competition, the liberalizing of the insurance contracts, and the increasing ingenuity of claimants, more attention will have to be given to the validity of claims presented. * * * With more attention paid by the companies to the selection and handling of their medical advisors over the country, they can develop a corps of officials whose ability and loyalty can be counted upon in the protec- tion of their interests and the prevention of imposition on the part of claimants, attending physicians and attorneys. "Competent examiners can save the companies money on almost every claim and, under both accident and health policies, it is quite likely that medical investigations will eventually be ordered by all companies in nearly every case of illness or accidental injury immedi- ately upon receipt of notic,e.''^^ "It is one of the conditions of the sickness insurance policy that indemnity shall only be paid for the period covered by regular medical attendance, and here we encounter a very difficult problem; the doctor had no personal relation with nor interest in the insurance company, but the claimant (his patient) is one of the community in which the doctor earns his income, and human nature asserting itself, the doctor resolves all doubts in favor of his patient, and prepares his certificate accordingly. The writer would not have it understood that disregard of the company's interest is the rule in the preparation of claim blanks, •"W. Edward Magruder, M. D., Medical examiner and adjuster for accident in- siirance companjes, Baltimore, in chapter on "Medical Examinations" in Dunham's Business of Insurance, Vol. II, pp. 112-114 and 118. 435 but it is ill evidence in a considerable number of the claims handled. Some companies endeavor to overcome this difficulty by employing a physician other than the claimant's attendant to make an examination and report respecting the nature of the sickness, the extent and duration of the disability, and the probable antecedent physical condition of the claimant. But here again, the same influences are to some extent present; the claimant is not the examiner's patient, but the examiner may nevertheless regard such relation as not only desirable but one of the possibilities of the future : the claimant may become a regular con- tributor to the doctor's income, while the insurance company pays him a single fee of modest proportions; what is more in accord with human nature than that the examiner will 0. K. the -certificate of the regular medical attendant? '^One of the greatest needs of sickness insurance as a business, is a corps of dependable medical examiners covering the territory in which the several companies operate. The common employment of such exam- iners would, perhaps, bring sufficient compensation to make them more or less indiipendent of local support, and would result in a considerable saving in the settlement of claims.""® The development of the health and accident insurance business of well-managed casualty companies into a safe and profitable business need not be described nor the extent of the profits made by the com- panies discussed. It is sufficient to say that the history of the casualty companies proves that it is possible for private enterprise operating upon a profit-seeking basis to furnish health and accident insurance of a fairly satisfactory nature at rates that are within the means of persons of substantial incomes. The principal defect of casualty company insurance as a means of meeting the needs of wage-earners is its cost. The cost of casualty company insurance restricts the usefulness of this insurance among wage-earners in two ways. In the first place it makes the purchase of the insurance in anything like an adequate amount and character im- possible for the great mass of wage-earners. In the second place, it discourages a large proportion of those wage-earners who make an attempt to carry the insurance from persevering in the attempt. The lapse ratio among industrial policy-holders is much higher than the lapse ratio among the holders of commercial policies. In the questionnaire sent to the casualty companies operating in Illinois the Commission asked for statements of the "approximate aver- age longevity of the policies issued by them in Illinois and the "approxi- mate lapse ratio" in Illinois* Of the 44 companies which returned the questionnaire 24 gave the information requested ; some of the remaining companies stated that they did not have the information while others gave no explanation of their failure to comply with the request of the Commission. The greatest average longevity reported was 5 years — reported by two companies which sell insurance only to members of certain fraternal orders ; the shortest average life reported was 3 months ««Reinard S. Keelor, M. D., Liability Underwriter United States CasuaUy Com- pany, etc., in chapter on "Sickness Insurance" in Dunham's Btisiness of Insurance, Vol. II, p. 131. 436 — reported by three companies fgr industrial policies sold on the monthly premium plan. The average longevity of commercial policies for all of the 24 companies would probably be about 3 years if the data returned to the Commission are accurate; while the average life of the industrial policies for those companies of the 24 which write industrial insurance would probably be between 6 months and 1 year. There are a number of other factors to be considered in explaining the lapse ratios of health and accident insurance policies, such as the failure of the policyholder to appreciate the importance of his insurance after the first enthusiasm kindled by the agent has subsided, the re- moval of the policyholder from the territory of the agent who sold him his insurance or his transfer to another company, but there is little doubt that inability to continue the payment of premiums is one of the im- portant causes of lapses among wage-earner policyholders. Although the cost is the principal defect in casualty company health and accident insurance as a means of protecting wage-earners against the losses which result from sickness and accidents there are other im- portant defects which will have to be remedied if this form of insurance is to be modified so as effectively to meet the needs of the greater num- ber of wage-earners. Mr. Miles M. Dawson has stated these defects as follows : "These policies (that is, the health and accident policies of the casualty companies, are renewable only at the pleasure of the company, which means that if the insured becomes liable to frequent disablement through failure of health, renewal will not be permitted. "The company has power to vary the premium rates from year to year. "Indemnity for any one disability is limited to a fixed term ; in case of sickness to twenty-six weeks * * * >^67 In connection with the first defect mentioned by Mr. Dawson the following statement from Dr. Eeinhard S. Keeler, an authority who like Mr. Dawson is an advocate of "continous policies,^' should be noted: "It is the common practice when making settlement of a claim for sickness due to a disease of recurring character, or a disease likely to leave a troublesome sequel, to insist upon the elimination of liability on the part of the company for sickness resulting directly or indirectly from such disease, as a condition precedent to the continuation of the insurance. Some companies accomplish this by use of what is called an eliminating draft in payment of the claim; others prepare a rider or indorsement and attach it to the policy, and this is, doubtless, the better plan, but the company should make sure that it is signed hy the policy- holder, and that it is actually attached to the policy. Thus the scope of the insurance may in course of time be considerably narrowed by a process of elimination — something that could not be done under con- tinuous policies having no cancellation clause.''^® "Miles M. Dawson, The Business of Life Insurance, 1905, pp. 244-245. Mr. DawRon does not confine himself, in the remarks quoted, to the needs of wage- earner.s but makes his criticism f?eneral. «* Reinard S. Keeler, M. D., Liability Underwriter United States Casualty Com- pany, etc., In chapter on "Sickness Insurance" in Dunham's jSw^iness of Insurance, Vol. II, p. 132. 437 It is perhaps significant that the only progress achieved by the casualty companies in the fourteen years since Mr. Dawson made the criticism quoted above in remedying the defects noted by Mr. Dawson is in the lengthening of the term for which indemnity for loss of time resulting from sickness is paid from 26 weeks to 52 weeks for most commercial policies. ^^ In most industrial policies the term is still limited to 6 or 8 months. PART II. INSUKANOB BY ASSESSMENT ACCIDENT AND HEALTH ASSOCIA- TIONS. (1) Introductory. The laws of the State of Illinois define an assessment accident association as a "corporation organized to insure against the contin- gency of death or other physical disability of the assured thereunder resulting from accidental injuries, and which provides for the payment of policy claims, the accumulation of reserve or emergency funds, and the expenses of the management and prosecution of the business, by pay- ments to be made, either at periods named in the contract or upon assess- ment as required by persons holding similar contracts, and wherein the insured^s liability to contribute to the payment of benefits accrued or to accrue is not limited to a fixed sum."^^ By an act of the legislature approved June 4, 1909, assessment accident and health associations are authorized to amend their articles of incorporation so as to include among their corporate powers "the authority to insure against disability resulting from sickness or disease, and to pay to the beneficiaries of * * * deceased members a funeral benefit which shall not exceed one hundred dollars ($100) in event of death of any member/'^^ Assessment accident and health associations have no capital stock and in this respect they differ from the casualty companies with which they compete, to some extent, in the sale of health and accident insur- ance. These associations are in form mutual companies similar, in some respects to mutual life insurance companies and, in other respects, to mutual fire insurance companies. They are frequently referred to as "mutual accident and sick benefit associations."'^^ The law in Illi- nois provides that the associations incorporated in the State "shall be managed by not less than five directors, trustees or managers, a majority of whom shall be residents of the State of Illinois, who shall be selected from and by the members * * * f^^ svich. period not exceeding three years as may be provided for in the by-laws and may be eligible for re-election."'^ The law further provides that the "board of directors, trustees or managers shall fix the amount of salary or per cent to be paid to all officers and managers of such corporation" and that they shall not "take or receive any of the money or funds of such corporation «» It is assumed without investigation that Mr. Dawson's statement of the time on the payment of sickness indemnity at the time he wrote is correct. '"^Insurance Laws of the State of Illinois, 1917, compiled by the Department of Trade and Commerce of the State of Illinois, Insurance Division, Chapter V, p. 88. "Same, pp. 95-96. " See, for example, the Spectator Company's Accident Insurance Manuel for 1918, p. 215, and the Insurance Year-Book for 1916, pp. A365 to A385 of the volume on Life, Casualty and Miscellaneous.' "/See Insurance Laws of the State of Illinois, 1917, p. 85. 438 in excess of the amount of salary or per cent so fixed" which is not to be changed "during the term for which such officers or managers are selected/^^^ || Assessment accident and health associations differ in form from the ' fraternal societies which provide sick and accident benefits in the absence of the lodge system with ritualistic work and ceremonies and the repre- sentative form of government which characterize the latter/^ In prac- tice the management of the assessment association is less democratic than the management of the fraternal societies, resembling in this respect the management of the mutual life insurance companies. Little has been written concerning the history of these associations. A survey of the "directory of mutual accident associations^^ and the "directory of mutual sick benefit associations" in the Insurance Year- Book shows that three associations were organized prior to 1880 — in 1869, 1870 and 1872, respectively — but that the great majority have been organized since 1900. "^^ In Illinois only three of the 20 assessment accident and health associations reported by Superintendent of Insurance Potts as operating in the State in 1916 were organized prior to 1900; these three date back, respectively, to 1885, 1890 and 1897." Five of the Illinois associations and one of the "associations of other states" included in the 20 associations mentioned were organized after 1910. The principal portion of the Illinois law now governing the assessment associations was enacted in 1893.'^^ These facts indicate that the assess- ment accident association plan has been in use in the United States for at least half a century and that it still is a plan to be reckoned with in the insurance world. Indeed the assessment associations have been increasing in membership fairly steadily and rapidly during the past two decades. According to the Insurance Year-Book for 1916, sixty-one mutual accident associations doing business in the United States had 725,399 certificates in force on December 31, 1915, and 116 mutual sick benefit associations had 633,969 certificates in force on the same date. During the year 1915 the two types of associations collected from their members in premiums or assessments and other payments, $6,862,167 and $5,217,- 375, respectively, and returned to their members in the payment of claims $4,228,611 and $2,726,503, respectively. The business of the associations increased steadily, with the exception of several years when decreases from the business of the preceding year were experienced by one type or the other, from 1901 to 1915. At the end of the year 1901 the accident associations had only 156,185 certificates in force and the mutual sick benefit associations only 153,907, aggregating about 23 per cent of the aggregate number in force for the two types of associations at the end of 1915.^9 "Ibid., p. 86. "Ibid., pp. 88-89 and 97. pp. 11^5^7 AZsl^''''^''''^ ^'''' ^^^^' '^''^''"'^ '''' "^'^^' Casualty and Miscellaneous," 'J Insurance Report Illinois, 1917, Part III, pp. 398-430 8 Insurance Laws of the State of Illinois, 1917, pp. 84 ff. or not al o?tSf assVn^ffnn^'^^l'^^^ ^?^ ^^^^ ^" ^^^ Insurance Yearbook whether or noi ail or tne associations shown in it are strictlv comnarnhip witvi t>io TiiiTir>iQ assessment accident and health associations '"-"'^^^^ comparable with the niinois 439 (2) Assessment Accident and Health Associations in Illinois. The following table shows the important statistical details of the history of the business of the assessment accident associations in Illinois during the years 1913 to 1917, inclusive.^^ Year. Certificates in force Dec. 31. Received from members for indemnity and expense purposes. Death, permanent disability, sick and accident claims paid during year. Certificates written during year. Certificates terminated during the year. By death. By lapse, surrender, etc. 1913. 1914 1915 1916 1917 158,530 169, 766 191, 150 206,551 228,030 $1,421,292.10 1, 557, 797. 91 1, 782, 801. 50 1,883,905.24 2,067,324.05 $1,094,847.81 1, 263, 101. 90 1,265,033.56 1,032,312.37 49,032 670 56,120 684 73,988 712 81,726 750 102,733 35, .526 45, 802 51,693 59, 278 t75,331 * Data not available. t "Policies terminated," presumably for all causes. ^ It is apparent from the table that the business of the assessment associations in Illinois has been increasing steadily and rather rapidly. The number of certificates in force at the end of 1917 was 43.8 per cent greater than the number of certificates in force at the end of 1913. Information as to the distribution of the business between health insur- ance and accident insurance is, unfortunately, not available. Many of .the contracts written by the associations are combination contracts, pro- viding both kinds of insurance, and most of the associations which re- turned the questionnaire sent them on behalf of the Commission reported that they were unable to supply separate data for the two kinds of in- surance. The fourth column in the table shows the total amount paid 'each 3^ear after 1913 by all the associations operating in the State for death, permanent disability, sick and accident claims. A very large propor- tion of the total is paid for sick and accident claims; a minor fraction for death claims and an insignificant percentage for permanent dis- ability claims. In 1916, for example, $941,220.70, or approximately 75 per cent of the total amount of $1,265,033.56, was paid for sick and accident claims, $319,812.86 was paid for death claims and only $4,000 for permanent disability claims.^^ The following table shows the assessment accident and health asso- ciations transacting business in Illinois in 1917 together with some of the more important statistical details of the business done by them in the State durinoj the vear.*- ^ Compiled from the Reports of the Insurance Superintendent of Illinois for 1914 to 1917, inclusive, and the Summary of the Standing, December 31, 1911, of the Assessm,ent Life, Accident, or Health Associations Transacting Business in Illi- nois compiled in 1918 by Superintendent of Insurance Potter. ^^ Compiled from Insurance Report Illinois, 1917, Part III, pp. 398-430. *- Prom the Su7nmary of the Standing, December 31, 1917, of the Assessvnent Life, Accident, or Health Associations Transacting Business in Illinois, compiled, 1918, by Superintendent of Insurance, Fred W. Potter. 440 m Name and location of association. Policies written, restored, etc. Policies term- inated. Policies in force end of year. Received from members during year. Claims paid during year. ILLINOIS ASSOCIATION. American Indemnity Co., Chicago.. Arcanian Accident Assn., Chicago. Bankers Accident Insurance Co., Springfield Bankers and Merchants Accident Assn. of Illinois, Canton Bankers Mutual Accident and Health Co., Freeport Central Business Men's Assn., Chi cago Clover Leaf Life and Accident Insur- ance Co., Jacksonville Commercial Health and Accident Co., Springfield Great Northern Casulaty Co., Chi- cago Illinois Commercial Men's Assn., Chicago (accident only) Illinois Traveling Men's Health Assn., Chicago Insurance Assn. of Railway Em- ployees, Chicago Washington Life and Accident Assn. of America, Chicago Total. ASSOCLA.TIONS OF OTHER STATES. Business Men's Accident Assn. of America, Kansas City, Mo Fidelity Health and Accident Co., Benton Harbor, Mich.-. Fraternal Protective Assn., Boston, Mass Hoosier Casualty Co., Indianapolis, Ind Inter-State Business Men's Accident Assn., Des Moines, Iowa Masonic Mutual Accident Co., Springfield, Mass Mutual Benefit Health and Accident Assn., Omaha, Neb National Accident Society, New York Woodmen Accident Co., Lincoln, Neb Total Aggregate. 4,384 20 2,845 711 776 8,821 25,755 3,416 523 16,607 6,973 670 20, 291 91,792 3,520 36 95 689 1,980 1,831 640 137 4,325 1,194 121 5,023 19,145 445 15,332 5,038 15,120 66,520 617 2,173 10,941 102,733 2,434 45 51 1,034 2,170 838 292 1,947 8,811 4,375 413 2,643 2,251 942 12,917 9,376 2,971 523 118,977 38,551 670 13, 914 208,523 5,446 15 198 512 2,984 2,413 756 7,183 19,507 75,331 228,030 $ 4,339.88 4, 156. 45 48,904.80 32,483.69 18,892.87 156,772.75 68,328.13 12,653.66 2,902.63 1,006,800.25 426,530.25 1,340.00 93,241.60 $1,877,346.96 $59,840.36 55.30 2,121.55 8,768.18 34,902.86 21,684.46 6,876.99 55,727.39 $189,977.09 $2,067,324.05 $ 387. 66 719. 20 9, 170. 72 10,929.27 1,936.66 63,017.15 16,572.84 V 627. 98 523,769.11 294, 215. 54 23,980.26 $945,326.39 $26, 558. 75. 512.25 1,113.46 4,255.57 13,470.72 10,664.05 1,045.88 29,365.30 $86,985.98 $1,032,312.37 It is appareut from the large proportion of the total membership of the assessment accident and health associations in Illinois which is found in the two associations of traveling men that only a minor frac- tion of the membership is composed of wage-earners as distinguished from salaried persons, business and professional men. The three asso- ciations whicli employ the name "business men's, association" use the term correctly, for one reports that it confines its business "strictly to business and professional men," a second, that not more than 10 per cent of its members are wage-earners, and the third, that "25 per cent or more" arc wage-earners. One association reports that its members are "nearly all farmers and residents of small towns and villages in northern Illinois." Several associations, as their names indicate, includ- ing the Fraternal Protective Association, confine their membership to 441 the members of certain fraternal societies and the proportion of wage- earners among their policyholders will therefore depend somewhat upon the character of the societies from which they are drawn. One of these associations states that 78 per cent of its members are wage-earners. Two other associations, not mentioned above, of the eleven which re- turned replies to the questionnaire of the Commission, stated that prac- tically all of their policyholders were wage-earners. All things consid- ered, it seems reasonable to conclude that no more than 40,000 wage- earners carried health and accident insurance with assessment associa- tions in Illinois at the close of the year 1917. (3) Policy Contracts Used hy the Assessment Accident and Health Associations. The limits of time and space do not permit a detailed description of the contracts used by the associations in Illinois, but it may be said that in general they resemble the contracts of the casualty companies in the benefits provided. Insurance is written by some associations against loss of time from sickness or accident injuries, loss of sight from accident or disease, and loss of life or limb from accident, with provision for surgical, hospital, quarantine and identification benefits similar to those found in the policies of casualty companies. Some of the policies written by the associations provide for death benefits or funeral benefits for loss of life by sickness as well as for loss of life by accident. Individual policies may contain part or all of the benefits mentioned above and health and accident policies may be written sepa- rately or in combination. Most of the policies contain the standard provisions prescribed by the Standard Provisions Law of 1915.^^ The payments made to the associations by their members usually include a membership or policy fee and quarterly or annual payments of specified amounts. The membership fee varies, in the contracts which have been submitted to the Commission, from $2 to $5. The quarterly or annual payments are divided into two parts, often separately stated, of which one is to cover expense and the other the pro rata cost of the benefits paid on the claims. Although the associations frequently state the amounts of the periodical contributions in definite terms, they possess the power, under the assessment association law,^* to call upon the policyholders for further contributions if the latter are necessary to meet the liabilities of the association. In some associations the maxi- mum amount of each contribution or assessment is fixed, but the fre- quency of payment left to be determined by the board of directors in accordance with the needs of the association. In other associations, as, for example, in one of the business men's associations, the cost of the insurance is paid by the member in a single annual premium, the amount of which is definitely stated in the policies and advertising literature used by the association. One association which replied to the questionnaire of the Commis- sion writes a weekly payment policy which is especially designed to appeal to wage-earners. This policy provides a death benefit payable ^Insurance Laws of the State of Illinois, 1917, pp. 125-134. 8* Same, p. 88. 442 whether or not death results from accident, a weekly indemnity for loss of time from disability caused by accident or disease, and specific additional indemnities for loss of hand, foot, sight or hearing. Women are prom- ised a maternity benefit equal to the sickness indemnity for one week. Information concerning the amounts of the benefits and their cost was not furnished. (4) Cost of Assessment Association Health and Accident Insurance. The assessment associations claim that they provide insurance at considerably lower rates than do the casualty companies. The Com- mission has not had the time necessary conclusively to verify or disprove this claim, which is a somewhat difficult thing to do in view of certain differences in the type of protection provided. Eeference to the table on page — shows that during the years 1914 to 1917, inclusive, the associations returned to their members approximately two-thirds of the amounts collected from them and in 1917 approximately half. Eefer- ence to the table on a preceding page, however, will show that the pro- portion for the associations as a group does not hold true of all the individual associations. The association mentioned above as specializing in weekly-premium insurance for wage-earners collected about four times as much from its members in 1917 as it returned to them in 1917. During the four years 1913 to 1916, inclusive, this association collected from its mem- bers and applicants, as shown by the annual reports of the Superintend- ent of Insurance, the sum of $134,9.21.53, net, and returned to its members in death, sick and accident benefits the sum of $41,075.43, or 30.4 per cent of the amount collected. During the same period it paid commissions and fees to its agents amounting to $51,968.86, or 126.5 per cent of the amount paid* to its members, besides salaries of man- agers or agents amounting to $6,627.26. This high ratio of expenses to claims paid may be partly due to the fact that the association is young, but it is largely the result of an agency and ^weekly collection system which is necessarily costly. Another association which has been oper- ating in Illinois for more than 20 years and which writes industrial health and accident insurance, collected from its members and appli- cants during the j^ears 1913 to 1916, inclusive, the amount of $225,- 859.65, net, and returned to its members $53,129.81, or 23.5 per cent of the amount collected. (5) Value of Assessment Insurance. It is apparent from the foregoing discussion that it is possible to persuade a limited number of wage-earners to buy assessment accident and health insurance even though collectively they receive in benefits considerably less than half, sometimes less than a third, of the amount they contribute to the associations. But it is also obvious that insurance which is so costly that a payment of from two to three dollars is required to insure a cash benefit of one dollar cannot be of material assistance in solving the problem of health insurance for wage-earners. 443 SPECIAL REPORT VII. FRATERNAL INSURANCE. I. Introductory. Among the voluntary insurance institutions which serve the wage- earners of Illinois the fraternal orders stand first in the amount, the variety and the general efi'ectiveness — in spite of some defects — of the insurance provided members of this class. It is impossible to say definitely how many wage-earners in the State are insured in these orders for the available records of the orders do not reveal this informa- tion and it is availiable nowhere else. According to the report of the Superintendent of Insurance for 1918, the "fraternal beneficiary societies authorized to do business in the State of Ilinois^' had an aggregate mem- bership in the State on December 31, 1917, of 1,043,469 persons.^ All or practically all of the members included caried life insurance in the orders of which they were members. Many were insured in the orders against sickness and accidental injuries. The "fraternal beneficiary societies" covered in Superintendents Potter's report include only those societies which provide life insurance. There are a number of other fraternal orders operating in Illinois which do not provide life insurance but which do furnish their members or some of their members with sick benefits in return for the payment of dues designed to cover the cost of the benefits. Many fraternal orders, of course, give charitable donations through the local lodges or otherwise to members who are in distress ; but charity is not insurance, however commendable it may be in purpose and results, and it will occordingly be omitted from the discussion in this study. Some persons are members of two or more fraternal beneficiary societies and are thus counted twice or more than twice in Superin- tendent Potter's report. Allowance must be made for this double count- ing in using the report as a basis for estimating the number of wage- earners and members of wage-earning families in Ilinois who are insured in the fraternal orders. On the other hand account must be taken of persons who are insured for "sick benefits" in those fraternal orders which are not included in the Superintendent's report. Finally, an estimate must be made of the proportion of the total number of persons insured in the fraternal orders who are members of the wage-earning class. After giving careful consideration to all the elements mentioned, the conclusion has been reached that it is safe to assume that the fra- ternal orders in Ilinois provide insurance of one or more kinds for at least 750,000 persons — men, women and children — of the wage-earning class. The fraternal orders vary greatly in the number and character of the insurance "benefits" which they provide for their members. An order may offer — subject to such legal restrictions as may be in force ^Insurance Report Illinois, 1918, Part II, pp. 67-71. 444 in the State in which it is chartered or licensed to do business — one or more of the following indemnities: death benefits (life insurance), funeral benefits, 'Svliole family protection^' (juvenile life insurance), old age and disability benefits, sick and accident benefits, maternity benefits. The fraternal orders have had a long and varied experience with some of the forms of insurance mentioned and the results of this ex- perience should be of great value in the consideration of any detailed plans which may be proposed for the solution of the problem of health insurance for wage-earners. The orders are organized on a democratic and cooperative basis; their activities in providing their members with insurance thus constitute a "great experiment in the possibilities of a democratic, cooperative, non-profit-seeking organization of the business of personal insurance. These facts and the fact that the orders are now providing some 750,000 persons, more or less, in the wage-earning class in Illinois with one or more forms of personal insurance warrant, the Commission believes, the detailed study which has been made of fraternal insurance. The information upon which this study is based was gathered by personal interview, correspondence and investigation of the records of the Superintendent of Insurance and the literature of fraternal insur- ance. One or more officers of the grand lodges of 45 of the 62 fraternal life insurance orders which had their headquarters in Chicago or else- where in Illinois on December 31, 1917, were interviewed by a repre- sentative of the Commission. The Chicago or Illinois representatives of a number of life insurance orders whose grand lodges are located outside of Illinois and the Chicago or State officers or representatives of a number of orders which furnish sick benefits or sick and accident benefits only were also interviewed. Questionnaires calling for detailed information concerning the character and amount of the death benefits or life insurance, the sick benefits and other benefits furnished by the grand lodge or the sub- ordinate lodges in Illinois were sent to the officers of the grand lodge of each of the 149 fraternal life insurance orders which were operating in the State at the close of the year 1917. Satisfactory returns were received from 125 of the 149 societies and the information for one society was obtained from the local representative in Chicago. The 126 societies thus accounted for represented on December 31,1917, 95 per cent of the Illinois membership of the fraternal life insurance orders in Ilinois. Of the 23 societies which failed to return the information re- quested by the Commission, six were small Illinois societies with an aggregate membership in Illinois on December 31, 1917, of 11,011 and 17 were small out-of-State societies with an aggregate membership in Illinois, on the date named, of 46,003. Questionnaries similar to those sent to the fraternal life insurance orders were sent to a number of fraternal socieites which furnish sick benefits but do not furnish life insurance and whose officers had not been interviewed personally by representatives of the Commission. Finally questionnaires to the number of 4,900 were sent, with the cooperation of the grand lodges, to the local lodges of a number of orders 445 in which the provision of sick benefits is left to the local lodges. The Commission received 1,871 replies, and, though it regrets that the number is not greater, it feels that the replies received are fairly representative of the conditions under which sick benefits and other forms of insurance are provided in Illinois by the local lodges of the fraternal orders concerned. II. Fraternal Life Insurance. (1) History. — Historically, fraternal life insurance seems to have appeared in the United States largely as the expression of a protest against the maintenance of legal reserves by the "old-line" life insur- ance companies and the unfair treatment given withdrawing policy- holders by these companies before the non-forfeiture laws, first enacted in Massachusetts in 1861, became general.^ Opposition to the main- entance of the reserve was based partly upon ignorance of the functions of the reserve and partly upon the practice then follow^ed by many com- panies of returning no portion of the reserve pertaining to his policy to the policyholder who was compelled to lapse his policy. A reserve in life insurance, the promoters and friends of fraternal insurance asserted, was as unnecessary as ''the fifth wheel of a wagon."^ Originally the plan of the fraternal societies was to collect "the amount of a claim * * * after the death of the insured by levying an assessment upon the living^ members."* "There is no doubt that this practice of post-mortem assessments * * * came into use because of men's unwillingness to part with their money until it is needed and as a result of suspicion of the accumu- lation of money in the hands of the regular companies. This sentiment caused the adoption of the following motto : The best place for a dollar — (that is, until required) — is the pocket of the man who made it. The idea was to call in money as needed and not a moment before ; and the assessments were originally a certain sum upon each living mem- ber at the death of a member. The benefit paid at the death of a mem- ber was collected in this way by one assessment."^ The first fraternal order to undertake the provision of life insur- ance in the United States, according to most historians of fraternal insurance,^ was the Ancient Order United Workmen. This order was organized at Meadville, Pennsylvania, October 27, 1868, by John J. Upchurch. "The object and purposes of the Order when founded were first to bring employer and employees together in a common fraternal home. Its members w^ere limited to mechanics and their helpers, artists and their assistants of the various branches. Protection of the home by way of insurance was provided for after the Order had a membership of one thousand, but the insurance feature was secondary .^^^ ^ Miles M. Dawson, Assessment Life Insurance, pp. 9-14 ; Solomon S. Huebner, Life Insurance, p. 231. '. *■ Quotations from Miles M. Dawson, work cited, pp. 3, 4. ** Miles M. Dawson, work cited, p. 3. " Sec Miles M. Dawson. Assessment Life Insurance, p. 23 ; A. R. Talbot, Fra- ternal Tjife Insurance in Dunham, Business of Insurance, Vol. 1, pp. 438-439. ""'The Loyal Workm,an," Official Org'an of the Ancient Order United Workmen Dcs Moines. Iowa, Jubilee Number, October, 1918, p. 2. 446 For the purposes of the present study the details of the history of fraternal life insurance in the United States need not be presented. Mention will be made, however, of certain important influences which have affected the development of this form of insurance in the United States. The success of the Ancient Order United Workmen during the years following its organization in 1868 "caused a large number of similar organizations to spring up, first in Pennsylvania and then wherever the new and flourishing order penetrated.^^^ The growth of the new form of life insurance was due largely, as has already been explained, to popular opposition to the maintenance of legal reserves and the retention of funds contributed by withdrawing policyholders or dividends on these funds by the "old-line" life insurance companies. The failure of 71 "old-line" companies during the decade from 1868 to 1887, inclusive,^ gave an added impetus to the fraternal insurance movement. The "startling disclosures" which were made "as to the methods followed by some of the most prominent among them" showed that "extravagance and mismanagement ran riot; self-interest dominated official conduct and utter recklessness characterized the investment of funds."i« Under the circumstances it w^as natural, if unfortunate, that the battle cry of "Keep, your reserve in your own pocket"^^ should control the insurance plans of the new societies and result in the establishment of fraternal insurance upon a high unscientific basis. Various plans for collecting funds were adopted, including the assessment of all mem- bers alike, regardless of age, and the assessment of members according to age at entry. Many of the societies failed; others survived only because of the strong fraternal spirit which animated them or because of other unusually favorable circumstances. The experience of the fraternal societies in their attempt to provide cheap insurance by dis- regarding the fundamental principles of actuarial science has been described as follows by Dr. B. H. Meyer : "It would be a thankless task to rehearse the long tale of failures among fraternal societies. Besides, old line companies and other de- partments of the mercantile world have had their epidemics of financial ruin. Yet, excepting paper money crazes, history probably affords no parallel to the blind and persistent adhesion which so many people in all parts of the United States have shown to hopelessly unsound schemes of fraternal insurance. An examination of many such schemes leaves upon one the impression that their promoters thought of certain sums of money to be paid as benefits under certain conditions on the one hand, and of certain contributions which it might be convenient to make on the other, without apparently reflecting upon a possible casual connec- tion between the two. The history of such organizations is quite gener- ally the same. A rapid increase in the membership, possibly also a simultaneous reduction in the average age; a gradual increase in the » Miles M. Dawson. Assessment Life Insurance, p. 23 •Lester W. Zartman, History of Life Insurance in the United States in Yale Readings in Insurance, Personal Insurance, p. 89. „ ,."\^^ ^^S*^^^' ,^^^^ Insurance by Fraternal Orders, Annals American Academy Pohtical and Social Science, Vol. 24, (1904), p. 478. "Abb Landis, work cited, p. 479. 447 death rate, accompanied by increasing difficulty in securing new mem- bers; an increase in assessments or rates and loss of members, or an attempt to slide along without raising assessments; and finally, finan- cial failure. That some fraternal societies are thoroughly sound, finan- cially, and that others have successfully advanced rates and maintained the integrity of their organizations does not affect this general state- ment. On the other hand, the very fact that an increase in contri- butions was found necessary in various societies is prima facie evidence that the original scheme was financially unsound."^^ Fortunately for the fraternal orders, the original lack of an actu- arily sound, basis for the insurance which they offered the public is not a defect which was inherent in the fraternal plan. The leaders of many of the orders have recognized the necessity for the aid of actuarial science in the computation of rates and for the establishment of ade- quate reserves and in a considerable number of cases have persuaded the rank and file of the membership to adopt "adequate rates.'^ In other cases the societies are struggling toward this ideal which was so abhor- rent to the original and many later promoters of fraternal insurance. To encourage or to compel progress in this direction the so-called Mobile and New York Conference bills have already been enacted into law in a number of states, and presented to the legislatures of other states for consideration. Details of these model bills will be discussed later in this study. "In trying to reorganize their scale of rates the societies are encoun- tering much opposition from their members and are experiencing much difficulty in educating them to an understanding of the situation. The problem involved is a serious one since many of the societies have been in existence for many years and, owing to their inadequate rates during the whole of their existence, are now obliged to increase their rates enormously in order to meet current claims. In other words, their problem is to find some way of meeting the situation which has grown out of the accumulating deficits of past years. And in trying to solve this problem the societies must contend with the conflicting interests of different classes of members. The older members naturally favor the retention of the old methods, since the raising of rates at the older ages to an adequate basis would, in many instances, mean an unbearable burden. The younger members, on the other hand, feel that they should not be asked to contribute for the benefit of the older members, and are therefore not so inclined to oppose a more equitable rate adjustment. In their attempts to reform their rating systems the societies have in most instances tried to compromise between these two classes of mem- bers, i. e. when deficiencies made it necessary rates were increased but the increase was greater at the older ages than at the younger ones. Many feel that, the only solution available ig * * * ^^q g^ regulate the inequality between the groups that additions to the young member- ship can be kept up until such time as the rates can step by step be finally raised to an adequate basis.' ^'^^ ^^B. H. Meyer, Fraternal Insurance in the United States, Annals American Academy Political and Social Science, Vol. 17, (1901), pp. 261-263. "Solomon S. Huebner, Life Insurance, p. 269. Dr. Huebner's quotation is from Walter S. Nichols, Yale Readings in Insurance, Personal Insurance, p. 378. 448 The following table'* shows the growth of fraternal life insurance in the United States in recent years. Year. Number of societies. Insurance written during the year. 1901. 1902. 1903. 1904. 1905. 1906. 1907. 1908. 1909. 1910. 1911. 1912. 1913. 1914. 1915. 1916. 1917. 489 580 509 575 570 590 543 547 645 497 396 397 509 498 472 523 Insurance in force at end of year. Number of certificates. Amount. S 799, 1,278, 1,313, 1,015, 1,026, 1,111, 1,212, 1,120, 1,203, 1,331, 1,200, 1,023, 1,065, 1,079, 922, 1,115, 822, 626,678 267,000 432,520 889,021 308, 429 906,048 382,432 569, 228 403,691 552, 713 633, 063 726, 087 071, 108 569, 596 890,579 784,564 041,734 4,518,955 4,947,370 5,644,619 6,054,296 6, 118, 938 6,890,564 7,282,416 7,887,365 7,909,626 8,558,093 10, 122, 169 9,963,019 8,058,317 7,868,554 7,695,944 8,674,996 7,456,551 $5,656, 6,115, 6,606, 7, 273, 8, 150, 8, 136, 8, 079, 8,438, 8,920, 9,562, 9,839, 9,472, 9,622, 9,171, 8,694, 9, 162, 9, 129, 453, 465 735,000 608, 321 069,328 350, 736 201,919 743, 281 204,968 716,227 511,910 909,282 232, 473 276, 590 284,227 449,483 111,616 974,447 With the number of certificates outstanding in 1917 reduced some- what as an effect of the war, the number of certificates approached the number of policies outstanding against the "old-line" life insurance companies, for the number of such policies was recently estimated at 7,800,000.15 (2) Fraternal life insurance in Illinois. — Illinois stands first among the states in the number of fraternal life insurance certificates in force and has the distinction of being the home of a number of the largest fraternal insurance orders in the country, including the Modern Wood- men of America, which is the largest of all. The following table shows the Illinois membership of the fraternal life insurance orders each year during the five-year period 1913-3 917, inclusive, together with other important details of the business done in Illinois by these orders.'^ Year ending Dec. 31. Illinois business. Number of members Dec. 31. Amount of indemnity in force Dec. 31. Received from members in Illinois for mortuary indemnity and expense purposes. Amount of [claims paid in I Illinois. 1913 1914 1915 1916 1917 983,538 992,346 1,010,350 1,017,183 1,043,469 $1,153,283,100 1,153,255,974 1,158,546,228 1,143,550,832 1,164,471,525 (*) (*) (*) $14,858,409 15,298,170 (*) (*) (*) $13, 121, 251 14,086,344 • Data not shown in the Reports of the Insurance Superintendent until 1916. "From the Insurance Yearbook for 1916, p. 376. '•"' News Items in The Spectator, December 12, 1918. "Compiled from the Reports of the Superintendent of Insurance of Illinois, 449 The fraternal life insurance orders which operate in Illinois are a variety of types. A large number are open to all white persons of "good moral character" who are not engaged in prohibited occupations and who are not outside the age limits specified for initiation as members. The qualifications for membership in other societies may involve race, nationality or knowledge of a foreign language, sex, religious affiliations, or occupation. The Poles, Bohemians, Croatians, Jews, Swedes, Italians, Germans, and Negroes have two or more fraternal societies each, and each of several other races are represented in Illinois bv at least one fraternal life insurance order. Adherents of the Roman Catholic faith have their choice of a number of orders, some of which have race qualifications and some of which do not. Lutherans have a similar but more restricted choice. Persons following especially hazard- ous occupations are commonly excluded from membership, and persons employed in saloons or in other enterprises connected with the traffic in intoxicating liquors are frequently excluded. A few orders restrict their membership entirely or largely to persons engaged in a single occupation or in a group of closely related occupations. There are several societies of this type among railway employees and several among commercial travelers. Many orders admit persons of both sexes to membership but a considerable number restrict membership to one sex or the other. All fraternal life insurance orders have age qualifications for admis- sion to beneficiary membership for this is essential as a matter of insur- ance practice. The minimum age requirement ranges from 12 to 21 but is usually 16 or 18. The maximum age requirement varies from 45 to 60; the ages most commonly fixed as the maximum are, in the order named, 50, 45, 55 and 60. (3) The life insurance contract in fraternal insurance. — The prin- cipal differences between the policies used by the "old-line" life insur- ance companies and the benefit certificates used by the fraternal life insurance societies have been described as follows : "The ordinary life-insurance policy is simply a definite promise to pay, in return for a fixed consideration, a stipulated sum on the occur- rence of the specified contingency, and contains all the conditions which govern the parties to the contract. In this respect fraternal societies follow a radically different plan. Although the certificate is issued on the basis of an application which is similar to that required by regular old-line companies, the benefit certificate differs from an ordi- nary policy in three important particulars : 1. The certificate is comparatively brief, usually stating that the holder thereof is a member of the society, that he is entitled to all its privileges and to a certain portion of the beneficiary fund, and that the society^s promise in this respect is conditioned on the member's com- pliance with the constitution and laws of the society, which are declared to be a part of the contract. In other words, the benefit certificate, unlike an ordinary life-insurance policy, does not specify in detail the conditions which govern the indemnity agreement; instead these are found in the society's rules. —29 HI 450 2. The certificate merely recognizes the holder's rights as a member in the society for a specified amount. The certificate remains the prop- erty of the member, who is usually given the right under the rules to change the beneficiary at will, while the ordinary life-insurance policy is the property of the beneficiary designated therein unless the insured has expressly reserved the right in the contract to change such beneficiary at will. Usually the holder of a benefit certificate can only name as bene- ficiary some member of his family or other dependent. 3. The certificate, according to the laws of most states, cannot be an agreement promising the payment of a definite amount for a, fixed premium as is the case with old-line companies. From a practical point of view the most important difference between fraternal and old-line insurance has been the failure of the formber to maintain a reserve suffi- cient to guarantee the pa^Tuent of all obligations as they mature^ In fact, until recently, the reserve idea was bitterlv opposed by most fra- ternal orders as an unnecessary overcharge. Instead of accumulating adequate reserves, the societies proceeded on the plan of charging low premiums (which experience soon demonstrated to be Avoefully inade- quate) and reserved to themselves the right, in case the funds on hand should prove insufficient to meet current claims, either to assess their members for an amount equal to the deficit or to scale down the amount of the benefit so as to make its payment possible with the funds on hand. In reality, therefore, the benefit certificate does not constitute a promise to pay a definite amount for a definite consideration. Since they have not promised to pay more than the funds on hand together with the assessments which they are able to collect from their members enable them to pay, fraternal societies, considering the matter from a purely theoretical standpoint, cannot become insolvent. Yet a very large number of such societies have passed out of existence as utter failures because they were unable to obtain sufficient funds through assessments upon their members to pay the benefits upon which the members were relying for the protection of their families in case of death and for which they had been contributing for years.''^'^ The face value of the benefit certificates written by fraternal life insurance orders operating in Illinois range from $100, in the case of a number of societies, to $10,000, in the case of at least one society. More commonly the certificates are for amounts ranging from $250 to $2,000 or $3,000. In some of the societies the largest certificate issued is for $1,000; this is true, for example, of a number of Bohemian and Polish societies. The average amount per certificate in force in Illinois on December 31, 1917, was $l,116.i8 The kind of certificate most frequently written is the whole-life certificate but certificates are also written on the term, limited pa>Tiient and endowment plans although most societies do not offer all of these forms. Most certificates now issued provide for level rates; -some, how- ever, are written on the step-rate plan. The premiums or assessments are usually payable monthly but some societies collect them 8 or 10 "Solomon S. Huebner, Life Insurance, pp. 264-265. "Compare data shown in the table on p. 448. 451 times a year and a few permit them to be paid annually, quarterly or monthly at the option of the insured. (4) The cost of fraternal life insurance. — The cost of fraternal life insurance naturally varies with the quality of the insurance. Poor insurance can be purchased at low rates; good insurance on the basis of rates sufficient to create an adequate reserve costs more. The follow- ing table shows the net cost per $1,000 of life insurance at different ages on the basis of the Xational Fraternal Congress Table of Mortality and an assumption of 4 per cent interest. ^^ NET LEVEL RATES — NATIONAL FRATERNAL CONGRESS TABLE— FOUR PER CENT INTEREST. Age. Annual. Monthly. Age. Annual. Monthly. 25 $11. 92 13.96 16.62 20.11 $1.04 1.22 1.45 1.75 45 $24.72 30.98 39.36 51.13 $2.16 30 50 . 2.71 35 55 3.44 40 60. 4.47 Note. — No provision is made for expense loading in these rates. Definite information secured by the Commission shows that at least 78 of the 149 fraternal life insurance societies which were operating in Illinois in 1917 have adopted the rates illustrated by the above table or higher rates. -^ In some societies the rates adopted apply to old members as well as to new members; in other societies the rates apply to new members only. The expense of management is eared for in various ways. The most common method is to levy a per capita tax, frequently 10 or 15 cents per month or the equivalent rates per quarter or per year. Sometimes an expense loading is added to the regular premium. Entrance fees, certificate fees, and funds derived from the sale of supplies are used to defray part of the expense of management in some orders. A por- tion of the assessments for the first year or the first few months of the life of a certificate is also used for the same purpose in some orders.^^ Reference to the report of the Superintendent of Insurance for 1918"- shows that the fraternal life insurance societies which transacted business in Illinois in 1917 received from their Illinois members the sum of $15,298,169.51^^ and paid claims in Illinois amounting to $14,- 086,343.79 durinsj the vear. These data cover sick and accident benefits, permanent disability benefits and other benefits provided by the grand lodges of certain fraternal societies as well as the life insurance pro- vided by all of them, but it is probable that the ratio of claims paid to receipts from members on the entire business in Illinois will be approxi- mately accurate for the life insurance business alone. This ratio is 92.1 "Compiled from table in Statistics Fraternal Societies, 1918 edition, p. 225. 2° Twenty-one societies use higher rates than those illustrated in the table for part or all of the certificates which they now write. ^^ Statistics Fraternal Societies, 1918 edition, pp. 7-192. "Insurance Report Illinois, 1918, Part II, pp. 57-61. -3 This sum includes only payments made for insurance furnished by the grand lodges. It does not include dues paid for other purposes either to the local lodges or to the grand lodges. 452 per cent for the year 1917. The amount received by the fraternal societies in 1916 from Illinois members was $14,858,408.64 and the amount paid in claims in the State in the same year, $13,131,251.37,-* making a ratio of 88.9 per cent for 1916. Similar data for earlier years are, unfortunately, unavailable. The report of the Superintendent of Insurance for 1918^^ shows the following totals for the entire business in the United States and else- where of the fraternal societies which transacted business in Illinois in 1917: Paid by members • • • • ^-"^^'ooo'c^Ann From other sources 16,233,560.99 Total receipts $139,530,226.75 Disbursements — » «„ „^. ..„ .- Paid to members $ 93,994,117.41 Expenses ■ 24,866,265.33 Total disbursements $118,860,382.74 The ratio of the "amount paid to members" (claims paid) to the amount paid by members for the entire business of the societies, as shown in the table, is 76.2 per cent, which, it will be noted, is con- siderably lower than the corresponding ratio for the Illinois business alone. The ratio of the amount paid to members to the total receipts is 67.4 per cent. The ratio of expenses to the amount paid by members for the entire business is 20.2 per cent; the ratio of expenses to total receipts is 17.8 per cent. The ratio of expenses to total receipts was 14.4 per cent in 1916 and 13.8 per cent in 1915.^® No data are avail- able to show the expense ratios for the Illinois business alone. The aggregate membership, as distinguished from the Illinois mem- bership, of the fraternal life insurance societies which operated in Illi- nois in 1917, was 7,277,659 on December 31, 1917.2^ The division of the $24,866,265.33 shown as expenses in the foregoing table among this number of members would indicate an expense of $3.42 per member for the year 1917. This amount is much higher, it should be said, than the amounts reported in the 1918 edition of "Statistics Fraternal Socie- ties" under the item "cost of management per member^' for most of the societies which operated in Illinois in 1917. In fact, according to the compilation cited, the "costs of management" for only a few of these orders were in excess of $3.4^2 per member while the "costs of management" of a considerable number were less than $1 per member. It appears from a detailed examination of the records for individual societies in the report of the Superintendent of Insurance and in the 1918 edition of "Statistics Fraternal Societies" that the term "expenses" as used in the former includes some items that are excluded from the classification "costs of management" as used in the latter. It is impossible, however, to determine the exact difference between the two classifications. But whatever these differences may be, it is safe to say that the fraternal life insurance orders furnish life insurance at a rela- tively low operating cost. "* Insurance Report Illinois, 1917, Part II, pp. 81-85. ^^ Insurance Report IlUnois, 1918, Part II, p. 61. ^Insurance Report Illinois, 1917, Part II, p. 15. ^Insurance Report Illinois, 1918, Part II, p. 13. • 453 The comparatively low cost of operation in fraternal life insurance societies is due to a number of causes. The organization of the societies on the basis of the lodge system makes for low acquisition of business and collection costs. The fraternal spirit, which is strong in some of the societies, also aids in various ways in keeping down expenses. The salaries and other compensation paid the officers and employees of the fraternal societies are low as compared with those paid the officers and employees of "old-line" life insurance companies. There are only a few fraternal societies in the United States in which the total compensation of all the officers and trustees will equal $50,000 per year, yet there is reason to believe that the officers of some of the larger orders are equal in ability to the officers of some of the larger "old-line" companies in which the president alone is paid a salary of $50,000 or more per year. As compared with stock companies in the life insurance business, the fraternals claim that they have an advantage in not being compelled to pay dividends to stockholders. (5) The advantages and disadvantages of fraternal life insurance. — The chief advantage of the fraternal societies as carriers of life insur- ance appears to be the relatively low operating cost which has just been discussed. Another advantage, which is important in influencing some "prospects," is the fraternal spirit which is said to influence the rela- tions between the insured and the insurer in fraternal insurance as contrasted with the commercial spirit which controls the relations between the insured and the insurer in "old-line" life insurance whether the carrier be a stock company or a mutual company. Concretely, the fraternal spirit is said to manifest itself in such ways as the payment by the local lodges of the life insurance assessments of sick or indigent members or, to take a recent illustration, the assumption by the mem- bers of the entire order of the burden of the war risk arising from the enlistment of members for military service.* Incidental advantages afforded by fraternal life insurance include the opportunities for social intercourse and the "training for citizen- ship" which are to be had in the local lodges. The privilege, offered in many societies, of participating in sick and accident benefits and, when necessary, of receiving charitable assistance from the societies is also an important advantage of the fraternal insurance plan. The chief disadvantage of fraternal life insurance has been its unreliability. The causes responsible for this characteristic have been sufficiently discussed in previous pages and the remedies proposed will be considered shortly. To some persons the social, fraternal and char- itable aspects of the activities of the fraternal societies, which appear advantageous to the rank and file of fraternal society membership, are not attractive and such persons commonly prefer the more "business- like" methods of the old-line companies. Whatever the relative merits of fraternal and old-line insurance may be, it seeems reasonable to infer from present indications that both types will persist for an indefinite time to come. The fact should also be recognized that, so far as wage-earners are concerned, each type of insurance occupies a more or less distinct place. While a considerable amount of "ordinary" insurance is sold to wage-earners by the old-line 454 companies, the majority of wage-earners who have anything approaciP ing adequate life insurance protection — and most of it is far from adequate — carry it with the fraternal societies. The industrial life insurance sold by some of the old-line companies is little more than burial insurance^^ and is not to be compared with the more ample protection commonly purchased by the holders of fraternal certificates. A considerable part of the industrial life insurance, according to the testimony of officers of fraternal societies, is sold to persons who are able to buy only the cheap- est and least desirable form of life insurance. Much of the industrial life insurance, moreover, is written on the lives of children and the fraternal societies until verv recentlv have made few attempts to enter the field of child insurance. From the standpoint of the broad problem of finding ways and means of improving the provision of health and allied forms of insurance for wage-earners it is therefore more im- portant to consider possible remedies for the defects of fraternal life insurance than to continue a discussion of its merits as compared with other forms of life insurance. (6) The movement for the establishment of adequate reserves. — As has already been stated, the leaders of many of the fraternal societies have recognized the need for the establishment of adequate reserves and at least 78 of the 149 societies which were operating in Illinois in 1917 have adopted rates for new members, if not always for old members, which are based on the National Fraternal Congress table and an assumption of 4 per cent interest or on higher standards. There is, however, much yet to be accomplished. It is still possible to organize new societies in Illinois to sell insurance on inadequate rates, a large number of the societies in operation have not adopted rates even for new business, and a considerable number of those which have adequate rates for new business are still charging inadequate rates on their old business. A recent report of the Commissioner of Insurance for Wisconsin con- tains a "valuation exhibit" for the fraternal societies authorized to trans- act business in Wisconsin. This exhibit shows (1) the "total net value of outstanding certificates (required reserve,'' (2) "the total assets available for payment of future death claims,'' (3) the ratio of (2) to (1). Among the societies included in the exhibit are 42 which were operating in Illinois as well' as in Wisconsin on December 31, 1917, the latest date shown in the exhibit. Of the 42 societies 13 had total assets available for the payment of future death claims which equalled or ex- ceeded the total net value of outstanding certificates and 29 had total assets which showed deficits ranging from 97.5 per cent, in the case of one society, to 14.3 per cent, in the case of another, with the remainder of the 29 fairly well scattered between the two extremes. The progress which has been made towards the establishment of adequate rates and reserves among the fraternal orders in recent years has been accompanied and partly caused by the enactment in most of the states of legislation designed to hasten and enforce this progress. The meausres enacted commonly follow one or the other of two model bills known, respectively, as the Mobile Bill and the New York Conference Bill. 28 For the discussion of industrial life insurance see Part II, Special Report VIII. 455 The Mobile Bill was adopted by the National Convention of In- surance Commissioners, at Mobile, Ala., September 28, 1910. It was concurred in by Conference Committies representing the Associated Fraternities of America and the National Fraternal Congress, and recom- mended by them for enactment into law in the various states. The New York Conference Bill consists of the original Mobile Bill as modi- fied by amendments adopted at the meeting of the National Convention of Insurance Commissioners at New York, December 11-12, 1911, in conference with representatives of the National Fraternal Congress and the Associated Fraternities of America and amendments adopted at latei* conferences in New York between the Insurance Commissioners and representatives of the fraternal organizations mentioned. The bills are designed to provide a complete chapter in the statutes for the "regulation and control of fraternal benefit societies." The societies are to be exempt from all other insurance laws on the statute books and no laws enacted in the future are to apply to the societies un- less they are specifically mentioned in the laws. The bills therefore set forth conditions under which fraternal benefit societies may be organized or admitted into a state and regulations governing the char- acter of benefits which may be provided, the choice of beneficiaries, membership requirements, the nature of the certificates issued, the in- vestment of funds, the liability of officers of a society for the payment of benefits (not liable), etc. The most important provisions of the bill, for the purposes of this study, are those which relate to the valuation of the certificates outstanding against the societies and the "provisions to insure future security .^^ These provisions have been described as follows : The bill may best be described as a compromise, concessions having been made on both sides. It does not undertake to fix the net rates for any order; instead, present inadequate rates are to be increased grad- ually, and this policy is to be expedited through the education of the fraternal membership to the necessity of such an increase. The bill, as originally drawn, provided that after 1912 each benefit society was to report to the insurance department a valuation of its certificates, the minimum basis of the valuation to be the National Fraternal Congress table of mortality. Since such a valuation is sure to show a heavy de- ficiency in many of the societies, the bill further provided that the valu- ation was not to be considered as a test of financial solvency. The re- sults of the valuation, however, including an explanation of the system, were to be furnished to the members of the societies beginning in 1914, with a view to educating them to the need of higher rates. It was also provided that the valuation of December 31, 1917, must be reported to the insurance departments, and that if the admitted assets at that time prove to be less than 90 per cent of the reserve and other liabilities, the deficit must "show a reduction of at least 5 per cent at each triennial valuation thereafter," and that "if such a reduction has not been made, and no good reason exists the insurance department may proceed to can- cel the society^s license, or begin proceedings for the society's dissolution.^' It is thus seen that the bill grants a society many years, in case of a large deficit, in which to place itself in a technically solvent condition. Under the bill societies are also enabled to group their membership. New mem- bers and such old members as care to enter the plan may be charged 456 adequate rates with mathematical reserves, while the older members may be permitted to continue in what practically amounts to a separate order. -^ The New York Conference Bill, including amendments of 1911, 1912 and 1913, provides (section 23a) that '^if the valuation of the cer- tficates * * * Qj^ December 31, 1917, shall show that the present value of future net contributions, together Avith the admitted assets, is less than the present value of the promised benefits and accrued liabili- ties, such society shall thereafter maintain said financial condition at each succeeding triennial valuation in respect of the degree of deficiency as shown in the valuation as of December 31, 1917.^° If at any succeed- ing triennial valuation such society does not show at least the same con- dition, the Superintendent shall direct that it thereafter comply with the requirements herein specified. If the next succeeding triennial valuation after the receipts of such notice shall show that the society has failed to maintain the condition required herein, the Superintendent may, in the absence of good cause shown for such failure, institute pro- ceedings for the dissolution of such society * * * "si According to the 1918 edition of ^^Statistics Fraternal Societies" (page 207) "at the beginning of 1918 the Mobile and New York Con- ference bills were in operation in the several states as follows: New Yorh Conference Bill: Arizona, Arkansas, California, Con- necticut, Florida, Georgia, Idaho, Indiana, Kentucky, Louisiana, Mary- land, Massachusetts, Michigan, Mississippi, Missouri, Montana, New Hamphire, New York, North Carolina, North Dakota, Oregon, Rhode Island, Tennessee, Texas, Utah, Virginia, Wisconsin, Wyoming. (28 states.) Mobile Bill, without the New York Conference amendments: Ala- bama, Colorado, Ohio, Washington. The folowing states have the old National Fraternal Congress Uniform Bill, which in principle is the same as the New York Con- ference Bill, except as to those sections relating to valuation and public- ity: Iowa, Maine, Minnesota, Oklahoma, Vermont. In South Carolina the Mobile Bill is practically in force through departmental rulings." The experience of the past half century has demonstrated the fact, which was well known to actuaries from the beginning, that neither private, profit-seeking enterprise nor the cooperative enterprise of the fraternal societies can provide satisfactory life insurance at equitable rates and at the same time disregard fundamental principles of sound insurance practice. The old-line companies are compelled by law to provide adequate reserves. The' ethics of fair competition between the fraternal societies and the old-line companies demand that such fra- ternal socieites as have not already done so be compelled to make similiar provision. But such action on the part of the fraternal socieites is even more urgently demanded for the protection of the purchasers of fra- ternal certi ficates, most of whom, it is safe to say, are unable in advance " Huebner, Life Insurance, p. 270. •« The date may be varied according to date of enactment of the bill. 81 Solomon S. Huebner, Life Insurance, p. 270. Italics by the present writer. 457 of experience, to distinguish good fraternal insurance from poor fraternal insurance. In connection with the problem of health insurance it may be said that the usefulness of the fraternal orders as carriers of this form of insurance would undoubtedly be considerably increased if all of the fraternal life insurance orders operating in Illinois which have not al- ready done so were to take effective steps towards the creation of ade- quate reserves. Such action should make it much easier for the fra- ternal societies to increase their membership and hence reach more of the members of the wage-earning class who are without health insurance. As the situation stands the fraternal societies which have adopted ade- quate rates and created or planned effectively for the creation of ade- quate reserves have to suffer from the poor reputation which the unreliability of the insurance provided by other fraternal societies has earned, in the minds of many persons, for fraternal insurance in general. The enactment of the Xew York Conference Bill or the Mobile Bill in the states which have been enumerated will eventually, if the measures as they stand on the statute books are not weakened by amend- ments, compel most of the orders operating in Illinois, as they have already induced some, to adopt adequate rates or to withdraw from the states which have enacted the measure mentioned. The enactment of one of these bills in Illinois, or of an effective substitute, would hasten the progress being made by the fraternal societies towards the establish- ment of all fraternal life insurance on a scientific basis. It would also affect some orders which are now operating only in Illinois as well as prevent the further increase of unsound fraternal insurance in the State. It is well known that some societies in Illinois would have difficulty in inducing their members to meet the requirements of the measures under discussion. All reasonable consideration should be shown such societies but the fact should be recognized that the welfare of the mem- bers of fraternal societies as a whole and the need of the State for sound insurance are more important than the difficulties of individual societies which have persisted in attempting to accomplish what has long been demonstrated to be impossible. III. Whole Family Protection. (1) Nature of the plan. — "Whole family protection," or juvenile or child insurance as it is sometimes more accurately called, is a very recent development in the field of fraternal insurance. It is so recent, in fact, that the statistical data gathered by the Commission with reference to the operation of the plan in Illinois have little significance except as they show the number of societies which had made provision for the plan at the time the data were gathered. The discussion which follows will therefore be confined chiefly to a description of the nature and purposes of the plan. Briefly stated, the primary purpose of whole family protection is to enable members to secure from the societies the assurance of funeral benefits for their children or for children for whose care they may be responsible. Because the death of children is the frequent result of sickness in the families of wage-earners as well as the cause of more or 458 less serious drains on their financial resources the Commission deemed an investigation of whole family protection advisable. An argument used by the fraternal societies in urging the passage of legislation permitting the societies to furnish this new form of in- surance is that the insurance is needed to supplement that provided by the industrial life insurance companies which have heretofore, with a few exceptions, been the only carriers Avho insured the lives of children. As stated in a Ibrief which has been presented to the legislatures of a number of states by representatives of the National Fraternal Congress. "Industrial companies insure the lives of children, but they confine their operations to congested districts. Under their methods for col- lecting premiums it is impractical for them to operate in sparsely settled communities; in fact, their activities are confined to cities or urban communities. The expense, if their business were extended to rural districts, would be prohibitive. In these circumstances persons who did not live in cities are deprived of the privilege of insuring their children. * * * rj^j^g Fraternal Benefit Societies operate largely in the rural districts and the members pay their assessments to the clerks of local lodges. It would require but little additional expense to have these clerks collect dues for members^ insured children, the machinery for the same being already in operation.^^ Two motives other than the desire to provide juvenuile insurance for members living in country districts appear also to have actuated the fraternal societies which have adopted the whole family protection plan. The first has been a desire to increase the membership of the societies by making a wider appeal to adults but especially by accustom- ing the children of the memlDcrs to the nature and spirit of fraternal insurance so that they will be ready to become members when they reach the age of eligibility. The second motive has been a desire to meet the competition of the industrial life insurance companies more effectively in cities like Chicago as well as in smaller cities where the fraternal societies and the industrial companies come into more or less competition with each other. The secretaries of the grand lodges of several societies have informed representatives of the Commission that they expect to compete successfully with the industrial companies because of the superior economy claimed for the fraternal society plan of soliciting business and collecting dues. The details of the whole family protection plan can perhaps best be made clear by a reading of the simple language of the model whole family protection bill which was enacted into law in Illinois at the last session of the Legislature. This bill was prepared by the National Fraternal Congress and approved by the National Convention of Insur- ance Commissioners at New York City on December 13, 191 6. The bill as enacted into law in Illinois follows: "Section 2a. Any fraternal benefit society authorized to do business in this State and operating on the lodge plan, may provide in its consti- tution and by-laws, in addition to other benefits provided for therein, for the payment of death or annuity benefits upon the lives of children between the ages of two and eighteen years at next birthday, for whose support and maintenance a member of such society is responsible. Any 459 such society may at its option, organize and operate branches for such children and membership in local lodges and initiation therein shall not be required of such children, nor shall they have any voice in the man- agement of the society. The total benefits payable as above provided shall in no case exceed the following amounts at ages at next birthday at time of death, respectively, as follows : two. Thirty-four Dollars ; three, Forty Dollars ; four. Forty-eight Dollars ; five, Fifty-eight Dollars ; six, One Hundred and forty Dollars; seven. One Hundred and sixty- eight Dollars; eight, Two Hundred Dollars; nine, Two Hundred and forty Dollars; ten, Three Hundred Dollars; eleven, Three Hundred and eighty Dollars; twelve. Four Hundred and sixty Dollars; thirteen to fifteen. Five Hundred and twenty Dollars ; and sixteen to eighteen years, where not otherwise authorized by law. Six Hundred Dollars. "Section 2b. No benefit certificate as to any child shall take effect until after medical examination or inspection, in accordance with the lav/s of the society, nor shall any such benefit certificate be issued unless the society shall simultaneously put in force at least five hundred such certificates, on each of which at least one assessment has been paid, nor where the number of lives represented by such certificate falls below five hundred. The death benefit contributions to be made upon such certificate shall be based upon the "Standard Industrial Mortality, Table" or the "English Life Table Number Six" and a rate of interest not greater than 4 per cent per annum, or upon a higher standard : Pro- vided, that contributions may be waived or returns may be made from any surplus held in excess of reserve and other liabilities, as provided in the by-laws : And, provided further, that extra contributions shall be made if the reserves hereafter provided for become impaired. "Section 2c. Any society entering into such insurance agreements shall maintain on all such contracts the reserve required by the standard of mortality and interest adopted by the society for computing contri- butions as provided in section 2b, and the funds representing the benefit contributions and all accretions thereon shall be kept as separate and distinct funds, independent of the other funds of the society, and shall not be liable for, nor used for the payment of the debts and obligations of the society other than the benefits herein authorized : Provided, that a society may provide that when a child reaches the minimum age for initiation into membership in such society, any benefit certificate issued hereunder may be surrendered for cancellation and exchanged for any other form of certificate issued by the society: Provided, that such surrender will not reduce the number of lives insured in the branch below five hundred, and upon the issuance of such new certifi- cate any reserve upon the original certificate herein provided for shall be transferred to the credit of the new certificate. Neither the person who originally made application for benefits on account of such child, nor the beneficiary named in such original certificate, nor the person who paid the contributions, shall have any vested right in such new cer- tificate, the free nomination of the beneficiary under the new certificate being left to the child so admitted to benefit membership. "Section 2d. An entirely separate financial statement of the busi- ness transactions and of assets and liabilities arising therefrom shall be 460 made in itse annual report to the Insurance Superintendent by any society availing itself of the provisions hereof. The separation of assets, funds and liabilities required hereby shall not be terminated, rescinded or modified, nor shall the funds be diverted for any use other than as specified in section 2c, as long as any certificates issued hereunder remain in force, and this requirement shall be recognized and enforced in any liquidation, reinsurance, merger or other change in the condi- tion of the status of the society. Section 2e. Any society shall have the right to provide in its laws and the certificate issued hereunder for specified payments on account of the expense or general fund, which payments shall or shall not be mingled with the general fund of the society as its constitution and by-laws may provide. "Section 2f. In the event of the termination of membership in the society by the person responsi'tia for the support of any child, on whose account a certificate may have i)cen issued, as provided herein the cer- tificate may be continued for the benefit of the estate of the child: Provided, the contributions are continued, or for the benefit of any other person responsible for the support and maintenance of such child, who shall assume the payment of the required contributions. (In force Julv 1, 1917). "32 (2) Present status of whole family protection in Illinois. — The in- formation upon which the present discussion of whole family protection is based was gathered at various times during the months from July to September, inclusive, in the year 1918. The data obtained show that of the 149 societies authorized to write life insurance in the State, at least 27, with 311,273 members, had taken steps to provide this whole family protection. Nine of these, with 150,952 members, had already placed the plan in operation. As has been indicated above, the whole family protection law did not go into effect in Illinois until July 1, 1917. After the law went into effect societies desiring to take advantage of it had to adopt the plan at their regular conventions or otherwise as prescribed in their laws, if they had not already authorized its adoption. Several societies have had the plan under consideration for some time but have postponed its adoption because of war conditions or because of conditions incident to attempts to change their business from an inadequate to an adequate rate basis. Because of these facts the experience with whole family protection in Illinois up to the time at which the Commission closed its investigation of this subject was too limited to make a detailed exam- ination of this experience of any value. (3) Advantages and disadvaiitages of the whole family protection plan— It is apparent from a reading of the model whole family protec- tion bill as embodied in the Illinois law quoted above that this new form (.r insurance has been well safe-guarded by the terms of this measure. The insurance is placed on a legal reserve basis and the maximum amount which can be carried on the life of a child is properly limited in accordance with the age of the child in order to eliminate the moral h azard which may exist if a child is over-insured. The rates *^Inaurance Laws of the State of Illinois, 1917, pp. 98-100. 461 charged by fraternal societies which have adopted the plan for nse in Illinois appear to be relatively low as is indicated by the following state- ment of the rates charged by a society which reported that it was to begin the writing of certificates under the plan in Illinois during the snmmer of 1918 : RATE OF MONTHLY ASSESSMENT FOR CHILDREN. Ordinary Whole Life Certificate — Monthly Ratb^ 25c — Schedule of Benefits. Amount payable if certificate has been in force for — Age next birthday at date of certificate. 10 11 12 13 14 15 16 1st 6 months. 2nd 6 months 1 year 2 years 3 years 4 years 5 years 6 years 7 years 8 years $17 $ 20 $ 24 $ 29 $ 38 $ 50 $ 63 $ 75 $ 80 $ 78 $ 75 $ 73 $ 70 $68 34 40 48 58 70 90 125 150 160 155 150 145 140 135 40 48 58 70 90 125 150 165 48 58 70 90 125 165 175 58 70 90 125 165 185 70 90 125 165 195 90 125 165 200 125 165 205 165 210 215 $65 130 The above certificate may be continued at 25c per month after age 16 until death for maximum amount, based on age at entry. TERM CERTIFICATE. Term to Age 16 — Monthly Rate, 15c — Schedule of Benefits. Amount payable if certificate has been in force for — Age next birthday at date of certificate. 10 11 12 13 14 15 16 1st 6 months 2d 6 months. 1 year 2 years 3 years 4 years 5 years 6 years 7 years 8 years 9 years 10 years 11 years 12 years 13 years 14 years $17 $ 20 $ 24 $ 29 $ 35 $ 42 $ 50 $ 60 $ 71 $ 83 $ 96 $110 $125 $125 34 40 48 58 70 84 100 120 142 166 192 220 250 250 40 48 58 70 84 100 120 142 166 192 220 250 250 250 48 58 70 84 100 120 142 166 192 220 250 250 250 58 70 84 100 120 142 166 192 220 250 250 250 70 84 100 120 142 166 192 220 250 250 250 M 100 120 142 166 192 220 250 250 250 100 120 142 166 192 220 250 250 250 120 142 166 192 220 250 250 250 142 166 192 220 250 250 250 166 192 220 250 250 250 192 220 250 250 250 220 250 250 250 250 250 250 250 250 250 $125 250 The above rate provides for insurance until age 16 only when the benefits and payments terminate. N"o important disadvantages in the whole family protection plan have been, brought to the attention of the Commission. All things con- sidered, it seems safe to conclude, as did the Legislature of 1917, that the plan is one that promises to be of material assistance to the wage- earners of the State and others interested in securing the insurance of funeral benefits on the lives of children. 462 IV. Fraternal Health and Accident Insurance. (1) Nature and developmeiit of fraternal health and accident in- surance. — The principal forms of health and accident insurance pro- vided by the fraternal orders are the "sick and accident benefits" which are paid in many of them for loss of time resulting from sickness or accidental injury. Frequently the term "sick benefit" is used to include both types of insurance — a practice which is explained by the fact that tlie same benefits are commonly paid for loss of time resulting from accidental injuries as for loss of time resulting from sickness. In addi- tion to sick and accident benefits, benefits for specific losses, such as loss of limb, sight or hearing, and benefits for total and permanent disability or old age disability are provided in a considerable number of societies. The history of fraternal sick and accident benefits in the United States has yet to be written. It is impossible, without a more detailed investigation than the time at the disposal of the Commission permitted, even to sketch the outlines of this history. It must suffice to say that the fraternal societies in the United States have had a long experience ill the provision of sick and accident benefits during which they have paid many millions of dollars in these benefits to their members and that to-day they are providing more wage-earners with health insurance than any other class of insurance carrier in the country. (2) Fraternal health and accident insurance in Illinois. — In Illi- nois, as in the United States as a whole, the fraternal societies are the ]irincipal carriers of health and general accident insurance^^ for wage- earners. The sick and accident benefits provided by a society may be paid by the grand lodge or by the local lodges or they may be paid by both, as the constitution and by-laws of the society may direct or per- mit. The provision of benefits by the local lodges may be made com- pulsory upon them in the constitution and by-laws of the society or it may be left optional with them. In some societies, of course, neither the grand lodge nor the local lodges pay sick or accident benefits. No reports of the sick and accident benefits paid are made to the Superin- tendent of Insurance in this State, except in the case of societies which provide these benefits through the grand lodge, and only a few of the societies in which the benefits are paid by the local lodges have collected statistics of the amounts so paid. The Commission, as stated on a previous page, sent questionnaires to 4,900 local lodges and received returns from 1,871 of them. It is therefore impossible to present com- plete and exact data in respect either to the amount of health and acci- dent insurance carried by the fraternal societies for members of the wage-earning class in Illinois or the number of persons in this class who are protected by this insurance. The report of the Superintendent of Insurance for 1918 shows that 50 fraternal insurance societies which transacted business m Illinois during the year 1917, and which had, on December 31, 1917, a total membership of 265,799 persons in the State, had made provision for anoir.Jf^fr,!?,^'" "general accident insurance" is here used to distinguish ordinary acclaent insurance from workmen's compersation. 463 the payment of sick and accident benefits^* for their members through their grand lodges. Six of these societies paid no sick and accident benefits in Illinois during the year mentioned; the remaining 44, with a total membership of 263,832 persons, paid 6,842 claims, amounting to $242,440.57 to Illinois members during the year.^^ The term "sick and accident benefits" as used in the reports of the Superintendent of Insurance includes both indemnity paid for loss of time and indemnity paid for specific injuries, such as the loss of a limb or the loss of sight or hearing. The reports do not separate the amounts paid for the two classes of benefits and it is impossible to obtain complete information in this matter from any other source. The Commission has information, however, which shows that at least 12 of the 50 societies do not pay benefits for loss of time. These societies, with an aggregate membership in Illinois of 92,600 persons on December 31, 1917, paid specific injury benefits amounting to $25,870.95 on 268 claims in Illi- nois during the year 1917. ^'^ Of the remaining 38 societies 29 advised the Commission that they pay benefits for loss of time. These societies had a total membership of 141,832 persons on December 31, 1917. Some of these societies pay sj^ecific injury indemnities as well as benefits for loss of time but data are not available to show how much they paid in each class of benefit in 1917 or in any other year. The foregoing discussion leaves 9 societies of the 50 unaccounted for. Of the 9, one has informed the Commission that the sick and accident benefits which it pays through the grand lodge are paid "in case of need and misfortune of members" — which suggests that they are paid as a matter of charity rather than as insurance; another has reinsured its members in an assessment accident and health association and has ceased doing business; and a third still pays sick and accident benefits on certain old contracts but does not write new certificates pro- viding for such benefits. No information has been obtained concerning the character of the sick and accident benefits provided by the remain- ing 6 societies. In addition to the 50 societies shown in the report of the Superin- tendent of Insurance for 1918 as having made provision for the pay- ment of sick and accident benefits 3 small societies not so shown have reported to the Commission that they paid such benefits in 1917 and that they still make provision for them. These societies, with a total membership of 7,325 at the close of the year mentioned, paid 760 claims amounting to $31,604.42 during the year.^^ The sick and accident benefits paid by these societies are for loss of time only. 3* A number of the societies pay benefits for accidents only. One society shown in Superintendent Potter's report is excluded from the statement above for the reason that it had no members in Illinois at the end of the year. Data shown in statement obtained from Insurance Report Illinois, 1918, Part II, pp. 373-619. 2^' Averages based on these figures are omitted because they are of little signifi- cance. Only part of the members are insured against sickness and accidents — and it IP impossible to say how many — and the benefits paid vary considerably in chaiacter. 2" These benefits were paid by 8 of the 12 societies; the remaining 4 paid no specific injury benefits in Illinois in 1917. The membership of the 8 societies was 90,633 on December 31, 1917. "One society, with a membership of about 4,000 on December 31, 1917, paid 657 of the 760 claims amounting to $27,450.69. 464 Summarizing the above discussion, it may be said tha-t the data available to the Commission show definitely that 32 fraternal life insur- ance societies which operated in Illinois in 1917 provide benefits through their grand lodges for loss of time resulting from sickness or accidental injuries, and indicating that few, if any of the remaining 117 societies make such provision for their members. Returns showing in more or less detail the character of the pro- vision, if any, made for sickness and accidents, were received from 122 of the 149 fraternal life insurance orders which operated in Illinois in 1917,^® including the 32 mentioned above. These returns throw a good deal of light upon the nature of the health and accident insurance carried by the fraternal orders. The following table contains a classi- fication of the 122 societies according to the kind of insurance provided and the method of administration used. Classification of societies. Number of societies.* Aggregate member- ship in Illinois, Dec. 31, 1917. Societies in which the grand lodge provides sick and accident benefits for loss of time Socieites in which the grand lodge provides specific injury benefits % Societies in which the provision of sick benefits** is compulsory upon the local lodges Societies in which the provision of sick benefits** is optional with the local lodges Societies in which no provision is made for sick, accident or specific injury benefitsft 146,495 255, 881 56,797 686,762 130,139 • Some societies appear in two or more classifications ; totals are therefore omitted as meaningless. t Tw^o societies provide accident benefits only. }. Usually apply only to accidental injuries, but in some societies cover losses occasioned by disease as vi^ell as those occasioned by accidental injuries, as, e. g., loss of sight or hearing or paralysis resulting from disease. *• The "sick benefits" provided by the local lodges usually cover loss of time from accidental injuries as well as loss of time from sickness. ft One society has an auxiliary association which, among other things, main- tains a tuberculosis sanatorium for members who can afford to pay for its services as well as for indigent members. Information similar to that shown in the foregoing table was sought from a number of fraternal societies which are not classified as life insurance orders but which were known or thought to be providing sick benefits through the local lodges. Because of the lack of time and funds required to make a personal canvas of these societies the investiga- tion of their activities was made chiefly by correspondence. A number presented the Commission with all the information asked for by it but unfortu nately a number of others failed to make any reply to the " Information incomplete for 4 of the 126 societies mentioned on p. 3. 465 requests made of them. Data obtained from nine societies show the following results : Classification of societies. - Number of societies. Aggregate member- ship in Ilhnois, 1918. Societies in which the provision of sick benefits is compulsory upon the local lodges 4 4 1 146, 752 Societies in which the provision of sick benefits is optional with the local lodges Societies in which sick benefits are provided by auxiliary sick benefit associa- tions 55,791 *2,000 Total 9 204,543 * Membership of parent society. Membership optional in auxiliary societies and number of members not reported. (3) Sick and accident benefits provided by the grand lodges. — Reference to the last table but one will reveal the fact that 32 of the 122 fraternal life insurance societies included in the table provide sick and accident benefits for loss of time through the grand lodges. Data regarding the nature and amount of the benefits provided for loss of time resulting from sickness and accidental injuries and the rules governing eligibility to receive these benefits were gathered through the questionnaires returned by these societies. These data show that in 17 of the 32 societies members eligible for health and accident insurance may exercise their option in purchasing it while in 10 societies member- ship as a beneficiary member (that is, a member carrying life insurance) ipso facto entitles a member to health and accident insurance and requires him to pay for it. The information received for the remaining 5 societies indicates that almost all of their members carry the sick and accident benefits provided but does not disclose whether such action is optional or obligatory. In some of the societies where the benefits are optional with the members less than 10 per cent — in two less than one per cent — take advantage of them; in others, a large proportion make use of the privilage. All in all, the questionnaires returned to the Commission in- dicate that an aggregate of about 60,000 persons carry loss of time dis- ability benefits of one kind or another with the 32 societies which furnish these benefits through the grand lodges. How many of these are members of the wage-earning class it is impossible to say definitely, but it is probably safe to say that at least two-thirds of the 60,000 or about 40,000, can be so classified. Benefits paid by the grand lodges for loss of time are usually ex- pressed as so much per week but they are sometimes fixed at so much per month or so much per day. The range of the benefits reported to the Commission by the 32 societies mentioned above is from $2.50 per week, which was one of several benefits provided by one society, to $120 per month which was the largest benefit paid by another society. Two societies reported minimum benefits of $3.50 per week, one a minimum benefit of $4 per week, ten a minimum benefit of $5 per week, one a minimum benefit of $15 per month, one a minimum benefit' of $20 per —30 H I month and the remainder minimum benefits of larger amounts ranging as high as $25 per week (in the case of two orders whose members are largely salaried persons). These benefits, it should be stated, are for the period of disability during which full benefits are paid; as will be ex- plained later, they are frequently scaled down after a certain number of weeks and months. Seventeen of the 32 socieites under discussion reported benefits which vary in amount in accordance with the dues paid by the insured member or in accordance with this factor and the occupational or other classification of the member. One society, for example, oSers benefits of $4, $6, $8 or $10 per week; another offers benefits of $5, $7.50, $10 or $15 per week; a third, benefits of $1, $2, or $3 per day; and a fourth, benefits varying from $15 to $100 per month. Twenty-nine of the 32 societies reported rules requiring a mini- mum duration of disability before a member can claim sick benefits. Three societies prescribe a "waiting period^^ of two weeks; one society prescribes a waiting period of eight days; one, five days, and one, one day. Another prescribes a waiting period of seven days for certain classes of members and a waiting period of one day for other members. All the others have a waiting period of one week. The insistence upon a moderate waiting period makes the cost of the sick benefits less without working severe hardships upon the members; it also probably reduces very considerably the danger of simulation for this reason that it is more difficult to simulate illness successfully for several days or a week than for a day or two. Where sick benefits, so-called, are paid indiscriminately for loss of time whether it results from sickness or from accidental injuries, the same waiting period rule naturally applies to both types of cases. Where distinct accident benefits are paid for loss of time, however, the benefits are commonly paid from the day of the accident. In some societies sick benefits are paid for the waiting period if disability lasts beyond the waiting period ; in others they are not. Ten of the 32 societies reported that they pay benefits from the date the dis- ability begins or the date of the first visit of the attending phj^sician, one that it pays from the date the disability is reported, and ten that they pay from the end of the waiting period. Two of the 32 societies pay no loss of time benefits until the disability has lasted six months and one pays no loss of time benefits until the disability has lasted 13 weeks. In all three of these societies the constitution and by-laws provide that the local lodges shall pay benefits to disabled members until they are entitled to receive benefits from the grand lodge. The returns from the remain- ing eight societies fail to disclose the practice with respect to the pay- ment of benefits for the waiting period. The combination of local and centralized administration of sick benefit funds by the three societies just mentioned is a fact of con- siderable significance in the study of fraternal health and accident in- surance. One of the dangers of the plan of providing benefits entirely through the local lodges is that the "law of the averages,'' which is very important in insurance, will not apply because of insufficient numbers in the average local lodge and that consequently individual lodges will be overwhelmed financially by the burden of caring for cases of chronic 467 or protracted illness ui* accident disability or that these cases will go uncared for. On the other hand one of the dangers of the plan pro- viding disability benefits through the gi*and lodge is found in the diffi- culty of detecting cases of simulation and malingering from a distance. The combination plan used by the three societies represents an attempt to combine the broader insurance basis afforded by the carrying of the risks in the grand lodge with the close supervision of claimants of bene- fits which is possible when benefits are administered by the local lodges. Although it is possible, by charging enough for the insurance, to provide for the continuous payment of sick benefits for a sickness of any duration, however long, none of the 32 societies at present under dis- cussion and few of the other fraternal societies from which information was received attempt to do this except, perhaps, in certain cases of permanent and total disability. The table on the next page shows the time limitations imposed by 37 of the 32 societies upon the payment of sick benefits. The remaining five societies are excluded from the table be- cause three^^ pay accident benefits only and the other two failed to report definitely the time limitations on their benefits. In most of the societies shown in the table disability from acci- dental injuries is reated as a form of sickness and is indemnified by the ordinary sick benefit for loss of time. In some of these societies, however, there are specific benefits for specific injuries or losses and in a number the loss of time resulting from disability caused by accidental injuries is indemnified by a special accident benefit which differs from the sick benefit. The benefits for specific injuries and losses are dicussed in a later section of this study. Five of the societies provide indemnities for loss of time from accidental injuries which differ from those which they provide for loss of time from sickness. In four, the accident bene- fit may be paid for a longer period of time than the sick benefit ; in one, this relation of the time limit is reversed. The rates of benefit paid for disability from sickness and disability from accidental injuries differ in two of the societies. One society pays benefits ranging from $7 to $20 per week for total disability from acci- dental injuries and 40 per cent of these benefits for partial disability from accidental injuries, while it pays benefits ranging from $8 to $15 per week for total and confining disability from sickness and one-fifth of these benefits for partial disability from sickness. The other society pays sick benefits ranging from $10 to $120 per month and accident benefits ranging from $20 to $80 per month. The conditions under which members of the fraternal societies which pay sick and accident benefits through the grand lodges may be insured for these benefits vary so greatly that it is impossible to state a general rule.*° Twenty-three of the 32 orders receive both men and women as members. Two of the 23 report the exclusion of women from ** Two of these three orders are composed chiefly of traveling salesmen and have, therefore, practically no wage-earners among their members, in the sense in which the term "wage-earner" is used in this report. The- other order is composed of em- ployees in the United States railway mail service and may properly be called an association of wage-earners, although its members are more highly paid than most of the wage-earners with whom the investigation of the Commission has been con- cerned. This society reports that it pays benefits of $21 per week for a maximum period of 52 weeks in case of disability from accidental injuries. *° The conditions governing admission to membership in fraternal societies are discussed on page 449 above. 468 participation in the sick or accident benefit plans. One of these reports that women are insured for death benefits only, the other that the wives of members are excluded from participation in the sick and accident benefits. The total number of females in the two orders in Illinois on December 31, 1917, was 515. Of the nine orders which do not admit both sexes to membership, one is for women only, and eight are for men only. Maximum continuous period for which benefits may be paid by grand lodge. Number of societies. Amount of benefit per week. Remarks. 5 years, 6 months 2 years 1 year, 28 weeks.. 1 year, 6 months. , lyear. 1 year. 1 year. 1 year. 50 weeks. 10 months. 40 weeks . . 30 weeks.. 6 months. 6 months. 6 months. 6 months. 6 months. 24 weeks . . 16||weeks.. 15 weeks.. 15 weeks.. 12 weeks. 12 weeks. 12 weeks. 10 weeks. 10 weeks. $ 5.00 6.00 6. 00 or $9. 00. 5.00 "3'56toVl4.0b 7. 00 to $21. 00 7. 00 or $14. 00 4. 00 to $10. 00 10. 00 to $120.00 per month 10.00 6.00 20. 00 per month. 5. 00 to $25. 00 5. 00 to $20. 00 5. 00 to $15. 00 15. 00 to $100.00 per month 6. 00 to $12. 00 5.00 or $7.00 5. 00 or $10. 00 5.00 8. 00 to $15. 00. 5. 00 to $15. 00. 6.00 2. 50 to $10. 00. 5.00 No reduction in benefit. No reduction in benefit. Grand lodge begins payment after local lodge has paid for 3 months. Benefit reduced to one-half after 40 weeks. No reduction in benefit. Grand lodge begins payment after local lodge has paid for 6 months. Data regarding benefits incomplete. Benefit reduced to one-half after 6 months. Benefit reduced to one-half after 6 months. Benefit reduced to $20.00 or $40.00 per month after 6 months. Ten year benefit certificate entitles holder to 5 weeks' benefits per year. Benefit undrawn in one year may be drawn in any subsequent year, hence the maxi- mum stated. Eight months for total and confining dls- abihty, 2 months for partial disability. Benefit reduced to one-half after 26 weeks. Benefit reduced to one-half after 15 weeks. No reduction in benefit. Grand lodge begins payment after local lodge has paid for 6 months. No reduction in benefit. No reduction in benefit. No reduction in benefit. No reduction in benefit. Benefit reduced to one-half after 12 weeks. No reduction in benefit. No reduction in benefit. Benefit reduced to S3.00 at end of fifth week and to S2.00 at efld of tenth week. If disability partial, benefits are one-fifth those stated. Data regarding benefits incomplete. No reduction in benefit. No reduction in benefit. No reduction in benefit. Twenty-eight of the 32 societies report that the age qualifications for admission to participation in sick and accident benefits do not differ from those for admission to participation in death benefits. Thirteen of the 28 have a minimum age qualification of 16 years for beneficiary members; one prescribes 17 years as the minimum; and 14 place the minimum at 18 years. The maximum age reported as qualifying an applicant for tnitmtion into a society ranges for the 28 societies from 45 to 60 years; ten societies report 50 years as the maximum; six, 60 years; five, 45 years; five, 55 years; one, 54 years; and one, 59 years. Ihe maximum age for initiation, however, is not necessarily the maxi- mum age at which members of an order in which sick "benefits are optional may insure against sickness nor the age at which sick benefits purchased at an earlier age must cease. A study of the constitutions 469 and by-laws of a number of the societies under discussion indicates that at least a considerable proportion of them place no maximum age limit on the carrying of sick benefits; the failure of other societies to provide the Commission with copies of their constitutions and by-laws makes it impossible to make a more general statement of the practice of the societies in this respect. Two of the four remaining societies which reported that they furnish sick or accident benefits through the grand lodge have special age limits for these benefits. In one of them persons between the ages of 16 and 60 are admitted to beneficiary membership in the order but male members who are 55 years of age or more and female members who are 40 years of age or more are ineligible to become "relief members/' as the members who participate in sick and accident benefits are called. In the other society the age limits for entrance to the order as a bene- ficiary member are also 16 and 60 but members under 18 and over 45 years are not eligible for admission to participation in the sick and acci- dent benefits plan. In the first society membership in the "relief depart- ment" terminates automatically for male members when they reach the age of 60 years and for female members when they reach the age of 50 years. In one of the 28 societies mentioned previously the right of mem- bers to receive sick benefits ceases when they attain the age of 60 years,, which is the maximum age for admission to the society. Two societies failed to report the age qualifications for participation in their sick bene- fit funds. In a few societies members of the older ages are permitted to partici- pate in sick benefits but are limited to the smallest benefits provided. In one society, for example, "every male and female member may insure himself or herself up to the age of 45 years for either $1 or $2 sick benefit a day" but "members who are over 45 years of age can insure themselves for $1 sick benefit a day only." Another society which provides sick benefits of $3.50, $7 and $14 per week restricts "persons between 45 and 50 years of age" to the "lowest class of sick benefits." As a rule the occupational restrictions which govern admission to the sick and accident benefit funds of the societies which administer these funds through the grand lodges are stated in the requirements for ad- mission to the order as a beneficiary member (that is, as a member carry- ing life insurance in the order). The general nature of these require- ments has been described on a previous page.*^ All of the 32 orders under discussion require medical examinations of the applicants for admission to the sick and accident benefit funds, but in most, if not all, of these orders the examination given for life insurance in the order is accepted as sufficient for these other forms of insurance. The practice usually followed by those orders in which mem- bership in the sick or accident benefit department is optional with the members of the order when the latter apply for sickness or accident benefits some years after having been examined for life insurance is not clear from the data presented to the Commission. It appears, however, that at last come of these orders require a new medical examination. *i Page 449. above. 470 Like the health insurance written by the casualty companies/^ the sick benefits provided by the fraternal orders do not cover all forms of sickness. Venereal diseases, diseases resulting from the intemperate use of alcoholic liquors or narcotics, diseases not common to both sexes, and diseases resulting from unnecessary exposure are the diseases most com- monly excluded from coverage. In some societies reduced benefits or no benefits at all are paid for certain chronic or other diseases such as "rheu- matism, neuralgia, lumbago, varicose veins, chronic hermorrhoids, fistula, hernia, nervous prostration, fits, crick, gout," to quote from a rather full list published in the constitution of one order. Some societies with women members pay benefits for disability resulting from pregnancy and child-birth, others do not; the practice of the societies with respect to maternity benefits will be discussed in a subsequent section.^^ Thirty-nine societies, including some of those which have been dis- cussed in the foregoing pages and some of those which have been mentioned, reported to the Commission that they make provision for the payment of specific injury benefits through their grand lodges. These societies had an aggregate membership of 255,881 persons on December 31, 1917. This membership is confined to no racial, religious or occu- , pational gi'oup but is broadly representative of the various groups which make up the fraternal life insurance world. There are no doubt a variety of reasons which have influenced the societies mentioned to make provision for specific injury indemnities. In some societies the members are exposed to peculiar hazards of occupation ; this is true of a nmnber of societies whose membership is not confined to persons engaged in the same occupation as, for example, one order which reports a large number of miners among its members, and another which is composed largely of farmers. In other societies specific injury in- demnities appear to have been adopted in recognition of their value to the membership in general— for insurance of this kind is desirable if not too costly— or as a competitive device for use in attracting and holding members. The time and space available for the preparation and publication of this study do not permit a detailed description of the character of the specific injury indemnities offered the public by- the fraternal societies operating in Illinois nor the presentartion of statistics showing the amount of this insurance which is carried by wage-earners in the State. It must suffice to say that the specific injuries covered vary more or less ^^°??/°^^®^y to society; that they include in the aggregate not only loss i!:^' T^ ' ^^^^'^ ^'' h^^^g fi"^^ accidental injuries, but also loss of sight or hearing and paralysis resulting from disease and insanity; and that the policies or certificates used and the by-laws which govern the indemnity contract seem to have been considerably influenced by the con- tracts used by the casualty companies. Reference may be made in support of this statement to the schedule of benefits shown on pa^e of this study. When specific injury benefits are paid for losses or injuries resulting e ither from sickness or from accidental injuries the society *'8ee pp. 407, Part II, Special Report VI « Pages 478. 480 below. p «- vi. 471 is usually relieved of the necessity of paying disability benefits in the same case for loss of time. This, it will be remembered, is in accord- ance with the practice of the casualty companies.''* Only a few of the societies which provide sick and accident benefits through the grand lodges attempt to furnish medical treatment for mem- bers except as a matter of charity, either before or during disability; in most of these societies the choice and payment of a physician are left entirely to the individual member. Two societies report that they furnish medical treatment to all members needing it. A study of the constitution and bv-laws of one of these societies indicates, however, that the functions of the society physicians in this order, one or two of whom are elected by each local lodge, are largely to investigate claims for the society and check malingering and simulation; when a member requestes the services of the physician elected by his local lodge the fees for these services are assessed against him as a special charge. Seven other societies report that the provision of medical treatment is left to the local lodges; in one of these societies some of the local lodges levy an assessment of 25 cents per month to pay for medical treatment; in another some of the local lodges provide medical and surgical treatment for members who have sustained accidental injuries, although the society reports that similar provision is not made in cases of sickness.^^ In some of the societies under discussion specific benefits are paid to cover costs of surgical operations. The foregoing pages have revealed the fact that the health and accident contracts''^ used by the fraternal societies which furnish health and accident insurance through the grand lodges are of great variety. Because of this situation it is hardly possible to sepak of typical con- tracts or to compare their cost with the cost of similiar contracts written by the casualty companies. The claims made for the superior economy with which the fraternal orders assert that they conduct the business of life insurance have already been noted ;*^ in so far as these claims may be valid they apply about equally well to the health and accident in- surance business as conducted by the grand lodges of fraternal orders. Although there are no contracts which are thoroughly typical of all or even of most of the contracts used by the fraternal societies which write health and accident insurance through their grand lodges the following schedule of benefits and charges may have illustrative value. This schedule is used by one of the larger societies which issues a contract similar in some respects to the contracts used by casualty companies. "Upon the furnishing of satisfactory proof, this Society agrees to pay benefits under this certificate, according to its grade and the Class of the ** See Special Report VI, pp. 415. *° It is possible that the provision of medical or surgical treatment in some of the societies referred to here is made as a matter of charity rather than in com- pliance with an insurance agreement. ^•^ Some of the societies to which reference is made furnish their members with special certificates containing the agreement with respect to sick and accident bene- fits ; others add special clauses governing these benefits to the life crtiflcates ; some appear to furnish no written evidence of the contract except that contained in the constitution and by-laws of the society. *^ Pages 453 above. 472 occupation in which tlie member is engaged, as indicated in the column marked with an^X in the following table. Disability. First grade. Preferred. Ordinary. Medium. Second grade. Preferred. Ordinary Medium. . Accidental death or loss of two limbs or both eyes 2. Loss of hand, foot or eye 3. Total disability from accident, weekly benefit 4. Partial disability from accident, weekly benefit 5. Funeral benefit 6. Totaldisabiliiy from sickness, weekly benefit, after first week 7. Partial disability from sickness, weekly benefit, after first week. 8 Total disability from sickness, bene- fit first week 9. Partial disability from sickness, bene- fit, fijTst week 5 S600.00 300.00 $450.00 225.00 $300. OO' 150.00 $400.00 200.00 $300.00 150.00 20.00 15.00 10.00 15.00 10.00 9.00 100.00 6.00 100.00 4.00 100.00 6.00 100.00 4.00 100.00 15.00 15.00 12.00 10.00 10.00 3.00 3.00 2.40 2.00 2.00 7.50 7.50 6.00 5.00 5.00 1.50 1.50 1.20 1.00 1.00 1 $200.00 100.00 7.00 2.80 100.00 8.00 1.60 4.00 .80 "Double Benefits. Above benefits under (1), (2), (3), and (4), axe doubled if the injuries are sustained while the member is riding as a passenger on a passenger train propelled by steam or electricity, and inside a coach or passenger car thereof, or by the burning of a hotel, public hall or theatre while the member is stopping at such hotel as a guest or while in attendance at a public meeting or performance in such hall or theatre other than as an employee. "Age at Entry. Above benefits are payable when entry age is be- tween 16 and 50. Sixty per cent only of the above benefits under (5), (6), (7), (8), and (9), are payable when entry age is between 50 and 55.'' The constitution of this society provides that the certificates shall be divided, as indicated in the schedule, into two grades and that the rates shall be $1.50 per month for certificates of the first grade and $1 per month for certificates of the second grade. The classification of risks into "preferred, ordinary and medium" is based upon, occupational hazards and adjustment is made for age differences by reducing certain of the benefits, as stated in the schedule, to 60 per cent of the amounts shown. The payment of sick benefits is limited, for both total and partial disability, to 12 weeks in any one year and the payment of accident benefits for total and partial disability to 26 weeks in any one year. All certificates held by male members terminates at age 60 and all certifi- cates lield by femaJe members terminate at age 50 "unless sooner ter- minated by lapsation, cancellation or otherwise." In considering the rates shown in the above schedule it should be remembered that they pay not only for sick and accident benefits for loss of time but also for accidental death, specific injury and funeral benefits. It should also be remembered that this contract is more important as an illustration of the possibilities of fraternal insurance than as a typical fraternal contract. Many of the contracts used by the fraternal societies have a more limited coverage and differ in other respects which are too numerous to describe in detail. 473 (4) Sick and accident benefits provided hy the local lodges in so- cieties in which such provision is compulsory. — The reports of the Super- intendent of Insurance show only those sick and accident claims which are paid by the grand lodges of the fraternal societies. In discussing the sick and accident benefits provided by the local lodges it is therefore necessary to rely upon data gathered directly by the Commission. As indicated in the tables given above/^ information was secured from 21 fraternal societies operating in Illinois which make the provision of sick benefits compulsory upon the local lodges. Of these societies 17 were life in- surance orders with a total beneficiary membership 56,797 on Decem- ber 31, 1917, and four were orders which do not provide life insurance, with a total membership in 1918 of 146,752. Estimates made by the grand secretaries of the 17 life insurance orders indicate that fully 45,000 of the 56,797 members of these orders should be classed as members of the wage-earning class. This conclusion is supported by the fact that 13 of the societies are composed chiefly of immigrants or native-born persons of immigranl: parentage, and three of negroes. Similar estimates are available for only two of the four non-life-in- surance orders comprising but one-seventh of the total meilibership of the four and it is therefore impossible to arrive at a definite conclusion as to the proportion of wage-earners among the total membership of these orders. In the light of such information and such estimates as are available, however, it does not appear unreasonable to assume that the total number of wage-earners among the members of the four orders is between 75,000 and 100,000. Some of the members of some of the societies under discussion probably do not participate in the sick benefit plans adopted by the local lodges but the data available to the Commission do not permit a statement of the number of such members or of the rules governing participation in the benefits. It is also impossible to state the total amount of the sick benefits paid during 1917, or any other year, by the local lodges of the 21 societies. In some of the societies no reports of the benefits paid are made to the grand secretary. Other societies for one reason or another failed to furnish the Commission with all of the information requested. Definite information concerning the amount of the sick benefits paid in 1917 is available, however, for 4 of the 21 orders, including the largest one of all, with an aggregate membership of 123,773, or 60.9 per cent of the 203,549 members of the 21 orders which reported that the payment of sick bene- fits was compulsory upon the local lodges. These 4 societies paid a total of $190,227.18 in sick benefits in the year 1917. About 94 per cent of this amount was paid by the society to which reference has just been made. The following table, compiled from data furnished by the secretary of the Grand Lodge of Illinois, shows the experience of this society in the payment of sick benefits in Illinois during the year mentioned. *8 Pages 465-465. 474 ^^^^^^^^^ lodges in Illinois, Jan. 1, 1918 ^^^^^^^^^^i n « q? I .Jtembcrs in Illinois, Jan. 1, 1918.. .-••• tIJS Members receiving sick benefits in 1917 : • • ■ j ' 2' " i-" ' - ' y ' li. <,<3t Amount paid in sick benefits in 1917 (exclusive of donations, death benefits and other relief necessitated by sickness. $178,bU7.51 Average amount of sick benefits received by each sick member 47*~i Average duration of sickness a aays Average cost per member to pay sick benefits (exclusive of donations, death benefits and other relief) ^i.K)i) In explanation of the data shown in the table it should be stated that the local lodges of this society in Illinois are required to pay sick benefits of not less than $2 per week and are permitted to pay sick bene- fits as much larger as they care to provide for in their by-laws. It is apparent from the average amount of sick benefits received per sick member and the average duration of sickness that the average weekly sick benefit paid by the local lodges of the order exceeds the minimum of $2. The secretary of the grand lidge for Illinois advises the Commission that "possibly the average rate of sick benefits in Illinois would be about $3 per week" but states that "many lodges pay as high as $5 per week." The local lodges are required to pay sick benefits continuously as long as a sick member is disabled, unless he is admitted to the home maintained by the order, "but the rate may be changed by by-law." More Or less detailed information concerning the nature of the sick benefits paid by the local lodges was obtained from 17 of the other 20 orders which reported the provision of sick benefits as being com- pulsory upon the local lodges. This information is presented in part in the following table, numbers being substituted for the names of the several orders. Society number. Sick benefits, amount and limitations.* Dues for sick benefits. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 16 16 17 Not less than $5 required 12 per week for 6 months, $1 per week for 6 months more; $78 maximum for life $5-$12; most lodges pay J6; a few, $7; 13-18 weeks per year $5-$7; 15-26 weeks per year $5 for 13 weeks; $2.50 for 13 weeks; not more than 26 weeks in 3 years $5 the minimum; lodges often pay $6 or $7 or for member in hospital, $10. Limit 6 monthsf $5 per week, or more than 6 months, after which local lodge may continue benefit $20 or $10 per month if funds warrant $4-$5 for 6-12 weeks per year $l-$5; most lodges pay about $5; some reduce from $5 to $2.50 after 13 weeks Men $3, women $2.50 for 5 weeks, then at half rates " and the order keeps up the dues of sick member" $5 for 25 weeks Not more than $5 for not more than 13 weeks per year. . Usually $5-$7 for 13 weeks per year Not less than $2 required $5 for 13 weekst Average $1 per day " ." Not less than $2 required No report. 50c quarter. 50c-$l month. 50c month. 50c month. 50c-75c month. No report. 25c-35c month. No report. No report. 50c month. No report. Usually 50c-70c month. No report. Vary as needed. Average $75c-81 month. 25c month and up. • Unless otherwise indicated the rate shov^m is the rate per week, t After the local lodge has paid benefits for the maximum period indicated the grand lodge pays such further benefits as may be payable to the sick member. The above table ilustrates the lack of standardization which is characteristic of the sick benefits provided by the fraternal societies. It also illustrates the inadequacy of the benefits provided by the local 475 lodges for it is obvious that benefits averaging not more than $5 or $6 per week and limited in most cases to 13 weeks or 6 months of sickness are inadequate.*^ It should be said^ however, that some wage-earners are members of several fraternal societies and are thus able to secure protection which is more nearly adequate in amount per week or month if not in the number of weeks or months for w^hich it may be paid. In fact evidence has come to the attention of the Commission which indicates that a few wage-earners are actually over-insured against sickness in as- much as the aggregate amount of weekly or monthly indemnity pay- able to them by fraternal societies, and, possibly, casualty companies or other carriers, in case of sickness exceeds the amount of their weekly earnings. But such cases are rare and it is safe to say that the majority of wage-earners who carry sick benefits in the local lodges of the fraternal orders under discussion have insufficient protection in respect both to the amount of the weekly or monthly indemnity and the length of time for which it is payable. The explanation of the inadequacy of these benefits*^ appears to lie largely in the cost of the insurance. Adequate protection in these societies would cost the average wage-earner more than he is able or willing to spend for health insurance. This is not io say that the rates charged by the local lodges are excessive, for the sick benefits are managed by the lodges on a cooperative basis and the members, in the absence of dishonest or inefficient management, get what they pay for. The diffi- culty is one which appears to be fundamental in all forms of voluntary health insurance now in' operation in the United States. In most of the 21 societies under discussion the sick benefits provided by the local lodges cover loss of time from disability resulting from acci- dental injuries in precisely the same way as they cover loss of time result- ing from disability from sickness. In three societies the grand lodges make provisions for the payment of specific accident indemnities, and when such benefits are paid they are commonly paid in lieu of all other benefits. But in these three societies cases of accidental injuries which are not of such a character as to require the payment of specific accident indemnities are treated as cases of sickness. Data with respect to the waiting period were submitted by five of the 21 societies. Two reported a waiting period of one week in all lodges, one a waiting period of two weeks in all lodges, one a waiting period of one week in some lodges and a waiting period of two weeks in others, and one reported that the local lodges had no waiting period. In two of the societies in which a waiting period was required sick benefits, when payable, were payable from the first day of sickness ; this was true in some of the lodges in a third order but not in all of them. In- formation is not available concerning this detail for the fourth order which reported the requirement of a waiting period. *' The characterization of the benefits under discussion as inadequate is not in- tended to reflect in any way on the societies which provide them. These societies in fact deserve great credit for having done as much as they have to meet the needs of their members for health insurance. 476 Infoi-mation concerning age qualifications for membership were re- ceived from 19 of the 21 orders under discussion. The minimum age qualifications range from 16 to 21, with seven^^ societies reporting 16 years, and ten, 18 years, as the minimum. The maximum age quali- fications range from 45 to 55, with seven societies reporting 45, seven, 60, and three, 55 years as the maximum. These qualifications, it should be emphasized, are for original admission to the societies. They do not necessarily govern admission to the sick funds but what the actual practice of the societies is in this respect the information available does not disclose. Two societies reported that the local lodges provide medical care for sick members at an expense per member of, respectively, $1 and $1.50 per year. Another society reported that the local lodges provide hospital service, when necessary, for sick members. A fourth society stated that most of the local lodges have "lodge physicians" who are usually com- pensated at the rate of $1 or $2 per member per year. (5) Sich and accident benefits provided by the local lodges in so- cieties in which such provision is optional with the local lodges. — Infor- mation was obtained from 56 fraternal societies operating in Illinois which leave the provision of sick benefits optional with the local lodges. Of these 52 were life insurance orders with a total beneficiary member- ship of 686,762 in Illinois on December 31, 1917, and 4 were orders which do not provide life insurance, with a total membership in the State in 1918 of 55,791. The information which the Commission has with respect to the total number of persons who carry sick benefits with the local lodges of these societies, the proportion who are members of the wage-earning class, and the aggregate amount of sick benefits paid in a year through these local lodges is so incomplete that it is impossible to present reliable statistics bearing upon them. The Commission found it impossible to get com- plete information. In only a few cases did the secretaries of the grand lodges have the data desired, for, as most of them explained, in most societies what the local lodges do in providing optional sick benefits is no concern of the grand lodge. It was therefore necessary to ask the secretaries of the local lodges for information. Because of the large number of local lodges in Illinois which might, under the laws of their societies, provide sick benefits if they so wished, it was necessary to request this information through coiTespondence. The Commission ac- cordingly prepared a questionnaire which it sent with the cooperation of the secretaries of the grand lodges, to the secretaries of about 4,900 local lodges in various orders operating in Illinois., Satisfactory or serviceable replies were received from 1,871 of the local lodges repre- senting 35 fraternal orders in all but 4 of which the provision of sick benefits is optional with the local organization. Of the 1871 local lodges replying, 56 were in societies in which the payment of sick benefits is made compulsory by the constitution or laws merr^UrVanYh'ylVri'ior^^^^ ^^' qualification is 16 years for female 477 of the grand lodge. The deduction of this number leaves 1815 replies which bear on the subject of this section. Of the 1815 local lodges in societies in which the payment of sick benefits is^ optional with the local organization, 1788 reported their membership, giving data which show a total membership for the 1788 of the 230,081 persons, including 212,258 men and 17,823 women. Only 525 of the 1815 lodges, or 28.9 per cent, reported that they paid sick benefits. These 525 lodges, as nearly as can be determined from a summary of the membership statistics reported by them, have an aggi'e- gate membership of approximately 63,000 persons or about 27 per cent of the total reported membership of 230,081. The number 63,000, how- ever, does not necessarily represent the number of members in the local lodges paying sick benefits who are actually insured for these benefits, for in some of the lodges some of the members do not participate in the sick benefits. If the percentage just mentioned holds true of the entire 56 fraternal orders which reported to the Commission that they leave the provision of sick benefits optional with the local lodges about 200,000 members of these orders are affliliated with lodges which provide sick benefits. It would appear that about 70 per cent of these are of the wage-earning group. The amount of the sick benefit paid by the 525 lodges mentioned! above ranges, according to the information received from the lodges, from $2 or $3 per week, to $10 per week reported by one lodge which io the only lodge reporting more than $7 per week. The amount commonly paid is $5 per week; but a considerable number of lodges pay $4, $6 or $7 per week. Where the membership is confined to women the benefits are likely to be lower than those paid where the membership is mixed or restricted to men. In one of the women's orders, for example, the sick benefits paid by the local lodges reporting range from $2.50 per week to $4 per week. In most of the lodges a member cannot claim sick benefits until he has been a member for three months or more. The requirement most frequently reported is 26 weeks. Many lodges have a requirement of 13 weeks, and a considerable number report a requirement of 4 weeks. One lodge reports that it pays benefits at any time after initiation ; one lodge reports that new members must wait 52 weeks before claiming benefits and another, perhaps through a misunderstanding of the question con- cerning the matter, reports that new members must wait 104 weeks before claiming benefits. A considerable number of the local lodges require no waiting period. The great majority, however, provide for a waiting period of 7 or 14 days. Other lodges report waiting periods which vary from 2 or 3 days to (in the case of one lodge) 42 days. In most cases the benefits when paid are counted either from the day sickness begins or is reported or from the beginning of the second week of disability. The payment of sick benefits to a member is commonly limited to a maximum number of weeks per year, varying from 6 to 52, with 13 weeks at the limit most frequently fixed. ^^^S amount of the weekly benefit is commonly reduced to one-half S initial amount after half the maximum numbers of weeks for which the benefit may be paid has elapsed, but tliere are some variations, both in the amount of the reduction and the time at which it takes effect. Many of the lodges failed to report on the methods used in determin- ing the validity of claims for sick benefits; those that did report usually stated either that the certificate of a physician or the report of a com- mittee of tlie lodge, or, sometimes, that both were required in support of claims. The benefits are usually provided according to the statements re- ceived from the local lodges^ from the proceeds of monthly assessments ranging from 25 cents, for the smaller benefits, to 50 cents, the amount frequently paid for the more common benefit of $5 per week. In a few locals in which the sick benefit is $3 per week or less the monthly assess- ment is only 10, 15 or 20 cents. In some locals in which the benefits are relatively large in amount or are payable, if necessary, for a relatively long period the assessments may run as high as 75 cents per month or, where assessments are paid annually, the equivalent $9 per year. In some lodges additional funds are sometimes secured from the proceeds of dances, picnics or other entertainments. Of the 525 lodges which reported the payment of sick benefits, 515 stated that the benefits covered disability from accidental injuries as well as disability from sickness. Ninety-five, or about 18 per cent, of the 525 lodges reported that they employ physicians to give medical care to sick members and 9 re- ported the employment of nurses for a similar purpose. No information of value was secured with respect to the arrangements made for the compensation of the physicians and nurses employed, except in state- ments from a few lodges that the lodge physician received $1 per member per year. (6) Fraternal life insurance societies ivhich provide no sick or accident benefits. — Nineteen fraternal life insui'ance societies which operated in Illinois in 1917 reported to the Commission that they pay no sickness or accident benefits in Illinois through either the grand lodge or the local lodges. These societies had an aggregate membership of 130,139 on December 31, 1917, of whom 66,441, or 51.1 per cent, were members of societies for women only and the great majority of the remainder members of the societies open to both men and women. The greater difficulty of successfully administering a plan of sick benefits for women no doubt is an important factor in the explanation of the absence of provision for sick benefits in the plans adopted by the societies mentioned. (7) Miscellaneous benefits provided bij the fraternal societies. — In addition to life insurance and indemnities for specific injuries and for loss of time from sickness or accidental injuries some of the fraternal societies provide other benefits. Among these are death or funeral bene- fits of relatively small amounts (as distinguished from life insurance), old a^e benefits, permanent disability benefits, and maternity benefits. J 479 Funeral benefits, as distinguished from life insurance, are sometimes provided by the local lodges of both the life-insurance and the non-life- msurance orders. As reported to the Commission, they range in amount from the cost of carriage or automobile hire and flowers for the funeral to $100, -^dth amounts of $50 or $75 perhaps more frequently than any other. In a few societies the provision of funeral benefits is compulsory upon the local lodges. In most of the societies from which the Com- mission secured definite information on the matter, the provision of the benefits is optional with the local lodges. In most of the societies in which funeral benefits are optional with the local lodges, only a minority of the lodges appear to make such pro- vision. The grand secretary of one women's society with an Illinois membership of about 40,000 stated that probably no more than 6 or 8 lodges in the entire State paid funeral benefits. Similarly in a society with a mixed membership of about 43,000 In Illinois the grand secretary repoi-ted that olny a few lodges paid funeral benefits. In some societies, however, a large proportion of the lodges make this provision. A Ger- man order, with 1,200 members in Chicago alone, advises the Commission that about half of its members in Chicago carry funeral benefits. Re- ports received by the Commission from 79 local lodges of a Polish order of mixed membership, wdth 216 local lodges in the State, show that 31 of the 79 provide funeral benefits. Similar reports from 29 of 40 local lodges of a Swedish order show that 17 of the 29 make such provision. The total number of fraternal societies, both life-insurance and non-life- insurance, known to the Commission to have one or more local lodges paying funeral benefits in Illinois is 33. All things considered, it is apparent that tlie provision of funeral benefits by the local lodges of fraternal societies in Illinois reaches only a minority of the membership of these orders in the State. This fact is probably to be explained in large part by the superior attractiveness of the life insurance provided by the grand lodges of the life insurance orders which can be purchased, in some cases, in amounts as low as $100 or $250. One Scandinavian order reports through its grand lodge that al- though it provides no funeral benefits for its members through either the grand lodge or the local lodges, these benefits as well as sick benefits are provided through two auxiliary benefit societies to which members of the fraternal order may belong if they choose. These auxiliaries pro- vide death benefits, respectively, of $200 and $100. In some of the societies the grand lodge pays the funeral expenses of a deceased member, not exceeding a fixed amount, as $100, upon receipt of the death certificate and undertaker's bill from the secretary of the local lodge, and deducts the amount so paid from the death benefit pay- able to the beneficiary of the deceased. This practice appears to be de- signed chiefly to insure re-imbur^ment of the local lodge for money advanced for funeral expenses or 'to protect the local lodge from loss on payments which it has guaranteed to undertakers. 480 The laws of Illinois authorize fraternal beneficiary societies to pay benefits to members who are not less than 70 years of age for disability arising from old age. Twenty-five societies reported that they make provision for the payment of such benefits. In some societies old age disability is treated as any other kind of total and permanent disability; in others special provision is made for it. In some societies old age disability payments are made at the rate of 10 per cent annually ^^ of the face value of the death benefit certificate held by the member until the value of the certificate is exhausted or reduced to a specified minimum reserved for a funeral benefit. In other societies, a member attaining the age of 70 may, if he chooses, discontinue the payment of assessments or premiums and receive a sum equal to the reserve on his certificate or some other specified sum or a paid-up cer- tificate for a reduced amount. In the latter societies attainment of age 70 seems to be accepted as conclusive presumption that a member is totally and permanently disabled, regardless of his physical condition. The foregoing description applies to old age benefits paid by certain societies from which the Commission received fairly complete information. Whether or not it also applies more or less accurately to the old age benefits paid by other societies is not known. Seventeen societies reported the provision of total and pennanent disability benefits. In one society these benefits are merely specific injury indemnities. In other societies the benefits are paid for permanent and total disability arising either from sickness or from accidental injuries and are charged against the amount promised in the death benefit cer- tificate. In most of the societies members have the option of paying extra for permanent and total disability benefits or of purchasing cer- tificates without these benefits; in one or two societies the benefits are features of all contracts written. The amount paid for permanent and total disability and the manner of its payment varies from society to society. One society pays 10 per cent of the value of the death benefit certificate each year until this value is reduced to $100 which is reserved for a funeral benefit. Another society pays the benefit at the rate of $12.50 per month per $1,000 of hfe msurance carried until the amount of the insurance is exhausted, or, m the case of term insurance, until the term for which the certificate was written has expired. Another society pays a lump sum, varying from $125 to $500 according to the rates paid for the certificate" for pennanent and total disability caused by chronic illness or permanent, total paralysis. Nine fraternar societies which operated in Illinois in 1917 reported to the Commission that they make provision for maternity benefits. One society pays $10 for the first 30 days after confinement and the regular sick benefit of $1, $2, or $3 per day, according to the rate paid by the member, thereafter. Another reports that it pays a maternity benefit (t $10. A third pays sick benefits for two weeks in maternity cases. A lourth makes the most ample provision for maternity benefits which has bmib^ht to the attention of the Commission. This societv amended "Sometimes discounted to present value. 481 its laws in 1917 to enable it to pay a maternity benefit of $50. Members under 40 years of age, who carry at least $500 of life insurance in the society and can furnish a certificate of good health, are eligible to partici- pate in the benefit plan upon payment of an assessment of 60 cents per month. (8) The fraternal societies as an aid in the solution of the health insurance proiem. — It is apparent that the fraternal societies have not found a complete solution of the problem of providing wage-earns with insurance against sickness and non-industrial accidents. The loss of time benefits which they provide, although usually of material assistance, are far from adequate in amount and are often inadequate in the length of time for which they may be paid. These defects are due chiefly to the fact that wage-earners in the fraternal orders cannot or will not pay for adequate benefits. They are defects which are common to all forms of personal insurance purchased by wage-earners in the United States except funeral benefits of small amounts provided by the fraternal societies and industrial life insurance companies and in certain other ways. But even if the benefits provided by the fraternal societies were adequate to meet the needs of the members of the societies, they would still fall far short of a complete solution of the problem of providing wage-earners with health insurance unless means could be devised of persuading all wage-earners, not otherwise insured, to apply for membership in fraternal societies and of assuring their election to membership. It can be said, therefore, and without giving offense to members of the fraternal societies, for they recognize and admit this fact, that fraternal health insurance at best can only be an aid in the solution of the problem. But, it may be added, if properly improved, fraternal health insurance may be a very material aid in actually solving the problem as it has been in attacking it. One of the greatest needs in fraternal health insurance at the present time is standardization on the basis of the best practice the societies have developed. The array of insurance plans now used by the fraternal societies providing insurance against sickness is bewildering even to those expert in insurance. Standardization of benefit plans would not only aid wage-earners in selecting plans best suited to their needs but it would also aid in the development and improvment of those plans. Com- petition among fraternal societies for members and competition between these organizations and other carriers would take place upon a higher plane and would probably have greater reference to costs of management than it does at present. Standardization of the kind here suggested does not mean deadening and stagnating uniformity any more than does standardization of life and fire insurance contracts and practices. It means progress along intelli- gent and intelligible lines in the genuine improvement of benefit contracts and the diminution of opportunities for the incompetent promoter of fraternal insurance who occasionally makes his appearance in Illinois. Another need in fraternal health insurance is a greater degree of supervision. This especially true in respect to the sick benefits provided by the local lodges. In some societies the local lodges pay benefits and collect dues for them that are more or less subject to the control of the —31 HI 482 grand lodge to whom the local lodges report the amount and number of claims paid. But this supervision is very loose — it does not, so far as the Commission has learned, extend in any society to the auditing of the books of the local order nor to the examination of the assets available for the payment of benefits. In most of the societies which authorize the payment of sick and other benefits by the local lodges even the loose degree of supervision described above does not prevail. In fact, as has been pointed out in an earlier portion of this study, the oJ0B.cers of most of the grand lodges do not even know what local lodges pay benefits and what lodges do not pay them except in those societies which make the payment of benefits compulsory upon the local lodges. Finally, in view of the great importance of the fraternal orders in the provision of health and allied forms of insurance for wage-earners at the present time and their probable importance in the future, it would seem desirable to place the Superintendent of Insurance in a position to exercise closer supervision over the activities of the orders, especially the activities of the local lodges, and to give him the power and funds necessary to permit him to encourage the further development of sound and beneficial forms of health insurance in the fraternal orders. 483 SPECIAL REPORT VIII. INDUSTRIAL LIFE INSURANCE. (By William Duffhis.) I. Introductory. Industrial life insurance has been defined as "life insurance for small amounts, ichiefly on the lives of wage-earners and members of their immediate families, with premiums payable weekly and collected from the houses of the insured."^ It is often referred to simply as "industrial insurance." The adjective "industrial" is used because this form of insurance is "especially designed to meet the requirements of the wage-earning or industrial population/^^ Industrial life insurance might well be called "burial insurance" — a name which is sometimes applied to it — if a more accurately descriptive term were desired, for term"its primary purpose is to provide * * * an absolutely certain method of acquiring the funds necessary to assure a decent burial and the payment of the expenses for medical attendance during the last illness/'^ The Commission deemed an investigation of industrial life insur- ance desirable for the following reasons : first, this form of insurance is designed, as has just been indicated, to provide indemnity for some of the results of sickness and accidents and it is thus closely allied to health insurance; second, the problems of industrial life insurance and industrial heath and accident insurance are similar at many points; third, the suggestion has been made that the industrial life and the industrial health and accident insurance businesses might be combined in the interest of economy;* and, fourth, it has been alleged that the industrial life insurance companies "absorb the greater part of the available resources for insurance purposes in families of small income" and leave little or nothing for the purchase of health insurance.^ II. Belative Importance of Industrial Life Insurance. Industrial life insurance business of the United States is a business of vast proportions. Exact data as to the number of industrial life insurance policies in force in the United States at the present time are not available but a recent estimate places the number at 38,000,000® and this estimate would appear to be fairly accurate. The same esti- 1 John P. Dryden, late president of the Prudential Insurance Company of America. Addresses and Papers on Life Insurance and other Subjects, p. 85. 2 Solomon S. Huebner, Life Insurance, p. 275. »Ibid., p. 275. * See the study of Casualty Companies, p. 403. '^ Charles Richmond Henderson, Industrial Insurance in the United States, 1908, p. 162. _ ^ 8 News item in the Spectator, December 12, 1918. p. 23. Forrest F. Dryden, President of the Prudential Insurance Company of America, states in an article published in June, 1918, that conservatively estimated there were at the time he wrote about 36.000.000 industrial policies in force in the United States "providing not less than $5,000,000,000 of insurance protection." North American Review, Vol. 207, pp. 862-867, June, 1918. 484 mate places the number of ordinary life insurance policies outstanding against the old-time companies in the United States at $7,800,000. The industrial policies in force therefore outnumber the ordinary policies by almost five to one, if the latter estimate is correct. When the amount of insurance in force on the two types of contracts is considered, how- ever, the situation is reversed because of the small amounts carried on the industrial contracts. The aggregate amount of ordinary life insur- ance in force for the life insurance companies of the United States on January 1, 1918, was $21,965,594,232 while the aggregate amount of industrial life insurance in force on the same date was only $5,223,- 415,465/ The first company successfully to attempt the provision of life insurance for wage-earners on the industrial plan in the United States was the Prudential Insurance Company of America organized in N'ewark, New Jersey, in 1875 as the Prudential Friendly Society. The Metro- politan Life Insurance Company and the John Hancock Mutual Life Insurance Company began writing industrial policies in 1879.^ The following table shows the growth of industrial life insurance during the first forty years after the beginning in the United States in 1875.^ Number of companies. Insurance written daring the year. Insurance in force at end of year. Year. Number of policies. Amount. 1876 1 3 3 9 11 18 20 22 25 24 24 $ 727, 168 34,768,035 93,736,727 242,250,959 380,832,362 566,037,936 661,097,015 749,717,264 999,079,322 1,013,676,330 1,047,036,454 $ 4,816 228,357 1,360,376 3,875,102 6,943,769 11,215,531 16,869,758 23,044,162 33,370,638 35,780,316 38,373,272 $ 443,072 19,590,780 144,101,632 428,037,245 01 Q KOI K7Q 1880 1885 1890 1895 1900 1,468,474,534 2,309,886,554 3,179,489,541 4,431,754,866 4, 803, 856, 730 5,193,830,295 1905 1910 1915 1916 1917 Little comment on this table seems necessary. The data shown clearly indicate that industrial life insurance has found a rather rapidly increasing sale among the wage-earners of the country and that a large proportion of wage-earning families now make use of it. It is evident from the next table that industrial life insurance plays a very important part in Illinois in aiding wage-earners to make provision for meeting the expenses of the last illness and burial and that the use of this form of insurance is steadily increasing. It is impossible, however, to say definitely how many wage-earners or how many wage- earning families are provided with industrial life insurance for the reason that some policyholders carry two or even several policies and for the further reason that in some families all of the members are insured while in others some of the members are without insurance. *The spectator, September 12, 191-8, p. 143 j^^ ®^®^*^l^.r^;.?°""^^"' ^^tory of the Prudential America, pp. 115-116. •Compiled from the Insurance Year-Book for 1916 p 273 Insurance Company of 485 This table shows the growth of industrial life insurance in Illinois during the years 1913 to 1917, inclusive.^" Year. Number of compan- ies. Insurance written during the year. Number of policies. Amount. Insurance in force at end of year. Number of policies. Amount. Average per policy. 1912 8 6 10 11 11 13 1913 1914 1915 1916 1917 327,869 349,279 403,313 447, 102 434,756 449, 183 $50,726,299 54,575,097 55,762,246 62,248,412 62,795,481 65,597,182 1,642,649 1,802,171 1,951,700 2,113,177 2,306,458 2,518,815 $227,916,345 245,080,388 261,259,249 279,764,403 306,616,086 336,825,822 $138. 75 135.99 133.86 132. 39 132. 94 133.72 Attention should be called to the average size of the policies in force in Illinois. This is shown in the last column of the table for December 31st of each year. It will be noted that the average ranges from $132.39 to $138.75 — a fact which emphasizes the very modest service rendered to the individual wage-earner by industrial life insurance. In this connection, however, two things should be borne in mind : first, that the wage-earner may insure members of the family other than himself and, second, that the averages shown are influenced by the restrictions placed upon the amounts for which children may be insured — a matter discussed later in this study. III. Policy-C ontracts in. Industrial Life Insurance. Although industrial life insurance is similar in many respects to ordinary life insurance it has certain distinctive characteristics which should be noted. These characteristics have been stated as follows : "1. The premiums are payable weekly whereas in ordinary life in- surance they are payable annually, semi-annually or quarterly. This may be regarded as the most important difference since the feasibility of industrial insurance depends upon, and the organization of the company's agency system must be adapted to, this particular method of paying premiums. Experience has demonstrated the necessity of very frequent premium collections if life insurance is to be widely disseminated among the wage-earning class. "2. The premiums, instead of being payable at the office of the company as is usually the case in ordinary life insurance, are collected weekly by the companies' agents from the homes of the insured. "3. The amount of the insurance is "adjusted to the unit of premium,'' customarily five cents, or a multiple thereof, up to seventy cents. Thus in industrial insurance we speak of five, ten or fifteen cent policies, and the amount of insurance available for that weekly premium will vary according to age of entry and will represent odd figures. In ordinary life insurance, on the contrary, the unit is the amount of insurance. We thus refer to $1,000, $2,000, etc., policies, and the factor that varies with the age of entry is the premium. " Compiled from the Reports of the Insurance Superintendent of Illinois. 486 ^^^^The insurance is extended to every member of the family, an^ the companies therefore issue both adult and infantile policies, while in ordinary life insurance the business is confined almost wholly to adult risks. In nearly all the companies industrial insurance is made to comprise all ages between one and seventy. Some of the smaller companies even insure childm before they are one year old."" Industrial life insurance is written on whole life/^ limited payment life and endowment policies which resemble closely, in most respects, the policies used in ordinary^ life insurance. The industrial life policies differ from ordinary policies, however, in the fact that if the policy- holder dies within six months of the date of the contract the amount pavable is usually only one-half of the amount of the insurance and in the further fact thai no cash surrender values are payable until the policy has been in effect for ten years or so.^^ There are also a number of minor differences which need not be noted here. Industrial life insurance policies, like ordinary life insurance policies, may be written on either the participating or the non-partici- pating plan, that is, the policyholders may or may not be given the right to share in the dividends of the insurance company. Until the past few years most industrial life policies were written on the non-participating basis but it had been the practice of the two leading companies for years to distribute "large-surplus accumulations to their policyholders in the form of voluntary dividends, which might otherwise have been paid to the stockholders."^* In 1915 the Metropolitan Life Insurance Company, of New York, which leads all other companies in the writing of in- dustrial life insurance, and which had up to that time been a stock com- pany, retired its capital stock and became a mutual company. In the same year the Prudential Insurance Company of America, which is the closest competitor of the Metropolitan in the writing of industrial life insurance, practically completed its mutualization.^^ The company which stands third in the sale of industrial life insurance is the John Hancock Mutual Life Insurance Company. It and several of the smaller com- panies in tlie industrial field are mutual companies. It is therefore safe to say that approximately 90 per cent of the industrial life insurance policies in force in the United States are now on a participating basis. "Some companies give the insured, in case he is dissatisfied with his contract, the privilege of surrendering the same within two weeks after its issue and receiving a refund of the premium. Other companies, again, give the insured the opportunity of converting his industrial policy into one on the ordinary plan, provided that when application for such con- version IS made the insured has attained a stated age (usually 18 or over), has paid all his premiums for ten or some other stipulated number of years, and can offer satisfactory evidence of insurability. In making such conver sions it is customary to give the full legal reserve as a sur- " Solomon S. Huebner. Life Insurance, pp 277-278 Of 70 o? 7?""^ °' ^^^ so-called whole life policies the premiums cease at the age " Solomon S. Huebner. TAfe Insurance, p 282 " Solomon S. Huebner. Life Insurance, p" 282* "According to the Insurance Year-Book fnr iqir n oat *-h^ *^„^+^ ^> +v,fl. 487 render value and to apply the same in payment of premiums on the ordi- nary policy."^^ Mention should be made of two features of industrial life insurance that are of importance in the insurance of children. One of these features is the limitation of the amount of insurance that may be carried on the life of a child to what is supposed to be sufficient to pay the normal ex- penses of the last illness and burial; the other is the fact that the in- surance purchasable for a given weekly premium increases with the age of the child until the age of 10 is reached. The amount of insurance which may be carried on the life of a child is closely limited in order to avoid the moral hazard which might exist if children were insured for amounts greatly in excess of the probable ex- penses of the last illness and burial. The limit set varies according to the age of the child. The fact that the amount of the insurance purchasable for a given premium increases with the age of the child until age 10 is reached is explained by the fact that the mortality of children normally decreases from- birth to about age 10, after which it increases constantly to the high- est age which is attainable. For this reason the policies issued hy the industrial life insurance companies are divided into two general classes: the "infantile policies" applying to chilldren under 10 and the "adult" policies applying to all insurable persons from age 10 to the highest in- surable age. IV. Cost of Industrial Life Insurance . As compared with the premium rates for ordinary life insurance the premiums charged. for industrial life insurance are high. Industrial life insurance is necessarily an expensive form of insurance. The reasons for this fact have been set forth as follows : "In the first place, Industrial policyholders, as a class, are from the point of view or mortality, worse risks than Ordinary policyholders. The adults of the Industrial classes are engaged in more hazardous trades, and often do not receive the same care and medical attention during periods of illness as do most Ordinary policyholders. The higher mortality is clearly observed when we compare the number of deaths expected from the American Experience Table with that from the Standard Industrial Table at corresponding ages."^^ "It will be seen at once, from a comparison of the figures in the last column of each of the tables, that the mortality of Industrial policy- holders is much higher than that of Ordinary policyholders at the cor- responding ages. Thus, at age 25 there are 953 Industrial deaths as against 807 Ordinary deaths for every 100,000 living policyholders. This difference becomes even more marked in the later ages. Thus, at age 45, although there are about 10,000 fewer living among the Industrial risks, there are nearly 300 more deaths among them in that one year. "Solomon S. Huebner. Life Insurance, p. 281. " Lee K. Frankel and Louis I. Dublin, The Principles of Life Insurance, A Course of Instruction for the Agents of the Metropolitan Life Insurance Cotnpany, Lesson IX, 1917 edition, p. 6. 488 Keduced to a basis of 100,000 living, at that age, there are 1,735 In- dustrial as against 1,116 Ordinary deaths."^® -j American experience mortality table. Age. Number living. Number dying. Deaths per 100,000. Standard industrial mortality table. Number living. Number dying. Deaths per 100,000. ^ 25 30 35 40 i5 50 55 60 89,032 718 807 83,2.57 793 85,441 720 843 79,028 917 81,822 732 895 74,319 %5 78,106 765 979 69,413 . 1,017 74, 173 828 1,116 64,157 1,113 69,804 962 1,378 58,316 1,262 64,563 1,199 1,857 51,614 1,469 57,917 1,546 2,669 43,782 1,717 953 1,160 1,299 1,465 1,735 2,164 2,846 3,922 "* ^ * You will see that the number of Industrial deaths per 100,000 policyholders exceeds the number of Ordinary deaths at the same ages all the way from about 20 to about 50 per cent. "The cost of Industrial insurance is still further increased by the expense involved in collection and supervision. In Ordinary insurance, the policyholder usually pays the premiums at the office of the Company, but in the Industrial department weekly house to house collections are the rule. Moreover, the weekly pa}anent of premiums makes necessary a very complicated system of bookkeeping, with a large office staff to look after the many details of the business. "These factors make the loading on Industrial policies much higher than is necessary on the Ordinary plan. Thus, the management ex- penses of Ordinary life insurance companies approximate 20 per cent of the premium receipts. The same item in Industrial companies, on the other hand, is considerably higher. In some of the smaller ones in which most of the business is new, the expenses rise to over 50 per cent of the premium receipts. The larger companies, where conditioQS of the business are more settled, have been able to reduce this item to less than 40 per cent, and in the Metropolitan, where the rate is lowest, it is about 35 per cent. * * * "The higher cost of Industrial insurance is, therefore, justified on these grounds. The workingman must pay a higher price for his in- surance, as for everything else which he buys in small quanities and pays for in installments. He pays for the service rendered to him, a service which is neither required by nor furnished to Ordinary policyholders.''^^ The following table shows the premiums received and the losses paid with respect to industrial life insurance in Illinois for each year from 1911 to 1917 inclusive, for all of the companies writing this form of insurance within the State.^" J»/Wd., Lesson II, 1916 edition, pp. 9-10 tlon. p^*?^ ^' ^''"^"^^^ ^"^ ^°"^s I- Dublin, work cited above. Lesson IX, 1917 edi- 1917*and"l91^8^ ^^^^ *^® iZeporfs of the Insurance Superintendent of lUinois for 489 Year. Premiums received. Losses paid. Ratio of losses paid to pre- miums received — per cent. 1911 $ 6,692,755.77 7,445,708.00 8,084,626.70 8,629,522.33 9,445,216.31 10,274,288.37 11,360,001.28 $2,009,579.01 2,205,337.00 1,544,337.11 2,560,984.56 2,777,308.12 3,083,078.88 3,470,266.45 30.03 1912 29.74 1913 19.10 1914 29.67 1915 29.40 1916 30.01 1917 30.05 For purposes of comparison with the ratios of losses paid to premiums received with respect to industrial life insurance shown in the last column of the table the corresponding ratios for ordinary life insurance in force in Illinois during the same period are worthy of note. These ratios are as follows: 1911, 31.78 per cent; 1912, 30.14 per cent; 1913, 29.55 per cent; 1914, 36.39 per cent; 1915, 34.94 per cent; 1916, 37.65 per cent; 1917, 31.65 per cent. In interpreting the significance of the ratio of losses paid to premiums received in industrial life insurance in the years indicated in the above table it is necessary to call attention to the fact that the "losses paid" do not include all payments made by the companies to their policyholders. As was stated on a previous page^^ it had been the practice of the two leading companies for years preceding their mutual- ization to pay "voluntary dividends'^ to their industrial policyholders and the dividends so paid and the dividends paid since mutualization are not included in the losses shown in the table.^^ In 1916 the Hon. Eufus M. Potts, then Insurance Superintendent of Illinois, received a special report from the life insurance companies doing industrial life insurance business in Illinois with respect to the relation between the total payments made to the companies since they began business by all industrial policyholders and the total payments made and funds credited by the companies to these policyholders or their beneficiaries during the same time. Mr. Potts has presented the data so gathered with respect to the three largest industrial life insurance companies to the Commission in the form of the following table and accompanying discussion: AMOUNTS PAID AND CREDITED TO INDUSTRIAL POLICYHOLDERS AND AMOUNTS OP PREMIUM RECEIPTS AND ACCUMULATIONS ON THE FUNDS OF INDUSTRIAL POLICYHOLDERS, FOR THE THREE LARGEST INDUSTRIAL LIFE INSURANCE COMPANIES IN THE UNITED STATES. FROM THE BEGINNING OF EACH COMPANY'S INDUSTRIAL BUSINESS TO DECEMBER 31, 1915. Total premium $1,811,843,770 Total interest income, etc 195.631,58:^ Total receipts $2,007,475,352 Total payments to policyholders $ 713,477,427 Total funds credited to policyholers 529,765,435 Total payments and credits $1,243,242,862 Percentage of payments and credits to receipts 61.9 21 Page 6. ^ Some of the policies issued before mutualization contained an agreement to pay cash dividends. The Prudential began writing such policies in 1897. Frederic L. Hoffman, History of the Prudential Insurance Company of America, pp. 235-237. 490 X tie percentage of total payments and credits to receipts varied iix the different individual companies whose business is included m this table from 57.9 per cent to 64.5 per cent. The average results for the last ten years' business of these companies were slightly better than for the whole period * * * used in the above calculations. "This [table] shows that * * * the total amount paid by policyholders for insurance is $2,007,475,352, but that the sum of $1,243,242,862 only was returned to the policyholders. Consequently, for each one hundred dollars that the policy holder received from these life insurance companies, he paid $161.47."^^ In the light of the data shown in Mr. Pott's statement and in the statement of Messrs. Frankel and Dublin of the Metropolitan quoted on a previous page (page 9) it seems safe to assume that from 35 to 40 per cent of the contributions of policyholders to the industrial life insurance companies, including interest earnings on funds paid in by policy- holders, are consumed by expenses of management. Because of the payment of dividends and the varying bases upon which they are calculated it is impossible to show exactly what an in- dustrial policyholder will get in the future for a five-cent premium paid for a given policy taken out at a given age. The following tables taken from the "Unique Chart for 1917"^* show the benefits promised by the companies indicated, exclusive of dividends, in policies written for per- sons of the agea stated and sold for unit premiums of three, or five cents per week. INFANTILE WHOLE LIFE. (One Company.) Payment of premium ceases on first anniversary of date of issue after insured reaches age 74. Amount payable provided death occurs after policy has been in force for the following periods. For a weekly premium of 5 cents. Age next birthday. Less than 6 months. 6 months. 1 year. 2 years. 3 years. 4 years. 5 years. 6 years. 7 years. 8 years. 2 3 4 6 « 7 8 9 125 $25 $34 $40 $48 $58 $70 $110 $150 25 34 40 48 58 70 110 150 208 25 25 40 48 48 58 58 70 70 110 110 150 150 194 201 29 58 70 110 150 187 35 70 110 150 180 55 110 150 173 75 150 167 $214 " Mr. Potts includes, very properly, interest on funds contributed by policy- holders and held in reserve for them as part of the cost of the insurance to the I)ollcyholder. " The Unique Comparative Chart of Premium Rates, of the Regular Life /»- aurance Companies, copyright by Sampson Dawe, Boston, pp. 366-369. 491 ADULT TABLES. (Condensed to Show Every Fifth Year Only.) One company. Age. ♦Whole life, 3 cents. Endow- ment at 80, 3 cents. 25 year endow- ment, 5 cents. Another company. Age. Whole Ufe. 3 cents.** 5 cents.** 20 annual pre- miums, 5 cents. 10 15 20 25 30 35 40 45 50 55 60 65 $97.20 81.00 67.80 57.60 49.20 41.40 34.80 28.80 22.80 18.00 13.20 9.60 $69.60 59.40 52.20 47.00 41.40 36.00 30.60 25.80 21.00 16.80 13.20 10.20 $56 53 52 51 50 47 44 40 10 15 20 25 30 35 40 45 50 55 60 $89 $149 74 124 62 104 53 89 46 77 40 66 33 55 27 45 21 35 16 27 11 18 $97 83 72 65 58 53 47 41 35 • Premium ceases on first anniversary of date of issue after insured reaches age 74. •♦Premium ceases at age 70. V. Industrial Life Insurance, and the Health Insurance Problem. In the introductory remarks of this study it was pointed out that industrial life insurance and health insurance are closely allied in that both forms of insurance are designed to provide indemnity for the re- sults of sickness. It might be added that no form of health insurance can be considered adequate to the needs of wage-earners unless either it or some other form of insurance provides indemnity to cover the ex- penses of the last illness and burial. It is therefore in point to con- sider briefly the advantages and disadvantages of industrial life insur- ance as it is being written to-day. The more important advantages which are claimed for industrial life insurance may be summarized as follows : 1. It provides absolutely safe insurance. 2. It provides insurance for every member of the family. 3. The premiums and the system of collection are adjusted to the needs and the convenience of wage-earners. 4. It is voluntary and democratic. 5. It develops habits of thrift among wage-earners. 6. It familarizes large numbers of wage-earners with the nature of insurance and some of them are thereby induced to provide them- selves with other and more adequate forms of insurance. 7. About ninety per cent of the industrial life insurance in force is now on the mutual basis and therefore subject to the control of the policy- holders. • The first advantage claim.ed — that of absolute assurance that the promises made by the insurance company to the insured will be carried out to the letter — must be acknowledged. This advantage is of great importance when industrial life insurance is compared with some of the 492 many unscientific insurance plans that have been tried among wage? earners in the past. The fact that industrial life insurance makes provision for the insurance of all members of the family from infants to persons of age 70 — except those who are considered undesirable risks — constitutes one of the strongest claims advanced for a favorable verdict in behalf of this form of insurance. Until the recent adoption of the so-called "Whole Family" plan of insurance by some of the fraternal insurance societies" the industrial life insurance companies were the only legally recognized and regulated insurance agencies which provided life insurance for the entire family. The claim that the premiums and the system of collecting them are adjusted to the needs and the convenience of wage-earners may be granted with the reservation that further improvement may conceivably be possible. The argument that industrial life insurance is desirable because it is voluntary and democratic is most commonly used in opposition to pro- posals for compulsory state or government insurance of wage-earners. It is beyoimd the scope of the present study to pass upon the merits of this argument. The claim that industrial life insurance develops habits of thrift among wage-earners is obviously true to a certain extent as the large num- ber of industrial life insurance policies in force in Illinois and in the United States generally^, indicates. It has not yet been proven, however, that the effects of these habits of thrift so developed are felt to any im- portant extent outside the field of industrial life insurance although allegations are frequently made by enthusiasts over this form of in- surance that the effects are widespread. In this connection the following opinion of the average wage-earner's ability and inclination to save money is worth noting: "That the average workman is little capable of continued thrift without supervision is shown by the methods adopted by industrial life insurance companies in collecting premiums. Agents are sent to call each week to collect driblets of surplus earnings. An obligation assumed will not be met unless the workman is constantly reminded of it and unless it is brought to his attention as a payment that must be met. By the method of collection he is brought to realize that the insurance must be paid before other expenses are reckoned. His resolution must be kept up to the point of action by weekly visits. * * * "The success of industrial insurance is due to the system of persistent collection, which compels the workman to provide first for his insurance out of his weekly earnings. Where lapses occur, it is because the com- pulsion is not strong enough ; the appreciation of the need has weakened under the reatization of the cost."^* The claim that the use of industrial, life insurance familiarizes large numbers of wage-earners with the nature of insurance and leads some of them to provide themselves with better forms of life insurance " See Special Report on Fraternal Insurance, pp. 457. "Robert Morse Woodbury, Social Insurance, pp. 24-25. 493 can be substantiated. The insurance companies instruct their agents to sell ordinary life policies or the so-called intermediate policies (poli- cies sold in units of $500 for premiums based upon industrial mortality tables and payable annually, semi-annually or quarterly) whenever the circumstances of the insured will permit him to purchase insurance of either of the kinds mentioned. But it is not to be expected that any large proportion of wage-earners will be able to provide themselves with ordinary or intermediate policies however much they may appreciate the superiority of these forms of insurance over the expensive industrial insurance. The argument that the industrial life insurance business is now al- most altogether in the hands of mutual companies and that the conduct of the business is therefore subject to the control of the policyholders will make a strong appeal to many persons who are enthusiastic over the possibilities of voluntary cooperation as a solution of the economic problems of the day. The fact that the mutualization of the leading companies practically eliminates the payment of profits in the form of stock dividends to private individuals will meet with the approval of other persons who object to the business of providing funds for the decent burial of wage-earners becoming a source of private profit. It will be well, however, not to expect much in the way of democratic con- trol of the great industrial life insurance companies. With from thirteen to sixteen million or even more policyholders each, they cannot be con- trolled democratically by their policyholders. It is to be expected that the self-perpetuating bodies of officers and directors in control of the largest companies will continue indefinitely in control and doubtless it is to the interests of the policyholders that this should be so. The principal disadvantage of industrial life insurance is its high cost. Another disadvantage is that the lapses are many in spite of a system of remuneration under which the agents are as much interested in preventing lapses as they are in writing new policies. Though com- paratively few surrender their policies after they have been carried for a few years, except in exchange for ordinary policies, many of the newer policies are permitted to lapse by failure to keep up the weekly premiums. The following table makes possible certain comparisons for the 13 com- panies writing industrial life insurance in Illinois in 1917.^^ Number. Amount. Policies in effect at beginning of year Policies issued, restored and increased during year . Policies terminated during year (a) Policies terminated by death (b) Policies terminated by maturity and disability (c) Policies terminated by expiry (d) Policies terminated by surrender (e) Policies terminated by lapse and decrease Policies in force at end of vear $32,613,257 5,898,596 3, 522, 051 412,990 11,221 73,773 185,988 2,838,079 34,989,802 $4,412,061,643 879,944,368 524, 476, .504 53,148,924 1,110,480 12,716,329 29,185,561 428,315,210 4,767,529,507 Thus, as against 5,898,596 policies issued, restored and increased by these companies in 1917, 2,838,079 were terminated by lapse or decrease. The number lapsed or decreased was 48.1 per cent of the "Compiled from Tables 8 and 9 of Illinois Insurance Report, 1918. number issued, restored and increased, 7.5 per cent of the total of those in force at the beginning of the year and of those added less the number terminated otherwise than by lapse or decrease, and more than four times as large as the terminations by death, maturity and disability, by expiry, and by surrender. What proportion of those issued are carried until death or maturity or are surrendered in exchange for other policies, and what proportion lapse we are unable to state. In addition to the defects of high cost and numerous lapses, in- dustrial life insurance falls somewhat short of the ideal in the matter of inclusiveness because of the considerable proportion of members of the wage-earning class who are excluded from its benefits. The following extracts from instructions issued by a leading company to its agents with respect to the selection of applicants for insurance will serve both to describe and to explain the situation: "The subject of hazard or risk in life insurance is one which should be of great interest to the agent. Thousands of applicants are rejected each year, and many more are not granted the form of insurance for which they applied. * * * "The favorable selection of applicants and the lower mortality which results from it, make it possible for the Company to decrease perceptibly the cost of insurance. If, on the other hand, the officers of the Company and its agents were to let up in their vigilance in the least, large numbers of undesirable persons would enter and soon bring about a higher rate of mortality, which would necessarily increase the cost of insur- ance. * * * "What, then, are the factors that determine an average or standard risk? They are as follows: 1. Physical condition. 2. Moral condition. 3. Family history. 4. Personal history. 5. Occupation. 6. Insurable interest. * * * "The physical condition of the applicant is covered by the medical examination. The Company will, in no case, insure on standard plans any one who is suffering from any organic trouble such as lung or heart disease, from any disease of the kidneys or other ailment which tends to shorten life. * * * The agent * * * should, in no case, write applications for persons who are blind, crippled or dis- eased. * * * "Almost as important as the physical condition is the moral con- dition of the applicant. This includes the habits of the insured. It is needless to say that those who associate with wild company and indulge in loose living usually break ^o\\u at an early age and give the highest mortality, even though their physical condition may be good at the time of their application. * * * In those cases where there is the slightest suspicion as to the moral hazard; the applicants are investigated by special inspectors, who report on the habits and general environment of the prospect. This has been found to be an extremely effective method 495 in eliminating undesirable applicants. Some companies obtain such reports for all Ordinary applicants. * * * "Under the head of moral hazard, we mav also consider the so-called lapse hazard. It is obvious that the purpose of the life insurance idea is not served unless the business written is of the kind that remains in force. Persons of a roving disposition shiftless or unsteady habits or purposeless lives, are, therefore, to he avoided as possible prospects. It is often easy to induce such persons to sign an application and to pay an initial premium, but as they have no real faith in insurance and no real desire to maintain it, they lapse their policies when a renewal premium is due. The loss sustained by the Company and the agent in such a lapse is more than financial, for only too often does a person who has lapsed a policy, no matter what the reason may be, fancy that he has a grievance against the Company, which in the airing tends to breed distrust among those who are being canvassed, and discontent among those already insured. * * * "Together with the family histor}^ habits and present physical con- dition of the applicant must be considered his personal or previous medical history. * * * Yoy instance, those who have had repeated attacks of articular rheumatism in the last few years are no longer standard risks. Neither are those who have kidney or gall stone colic. A man of light build with doubtful family history, whose work is in- doors and who has been laid up with bronchitis, pneumonia, or pleurisy, is nowhere near as good a risk as one with a worse family history who is of robust physique, works out of doors and has never been ill. * * * "It must not be supposed that those who fall below the standard in any one of the first five of the above six considerations are necessarily rejected. In the earlier days of life insurance, when the companies were small, thy could not assume risks in which there was even the slightest amount of extra hazard. To-day, on the other hand, many companies, because of the large number of their policyholders, can well afford to be liberal in their attitude in this regard. Accordingly, only a small per- centage of applications [accepted by agents?] is rejected outright. In most cases where there is any question as to the safety of the risk, a higher priced or shorter term policy may be offered." The above instructions are quoted in no spirit of adverse criticism of the company which issued them. All successful life insurance com- panies follow the policy set forth in the instructions and much is to be said in favor of their continuing to do as long as life insurance continues to be provided on a voluntary, individualistic basis where each person insured is supposed to pay for his own risk Nevertheless, in the con- sideration of the problem of insurance for wage-earners the fact that there are a considerable number of persons in this class who^ because of an impaired physical condition, either cannot obtain insurance at all or can obtain it only at an increased cost which may put it beyond their means, is a fact which cannot be ignored. It might be said, in- deed, that the need of the "impaired risks" for insurance is more urgent than that of the good risks. 496 The high cost of industrial life insurance is inherent in the system of individual solicitation and weekly, house to house collection of premiums which characterizes this form of insurance. There is no evi- dence available to 'the Commission to show that the high cost is due in any appreciable degree to wasteful management or exorbitant commis- sions paid to agents In fact such evidence as is available is to the con- trary effect. It has been suggested that the cost of industrial life insurance might be reduced by providing for the payment of premiums monthly instead of weekly. Men experienced in the business scoff at the suggestion. The following statement was written twenty years ago but it is no doubt as true to-day as it was when it was written : "Weekly payments of premiums, instead of quarterly or even monthly installments of annual premiums, are a necessity. We may grieve that it is so; no part of the business so greatiy increases the ex- pense; but it is so, and the part of wisdom is therefore to meet the necessities of the situation, and not to worry over them. The history of life insurance is full of the failure of monthly installment plans. No one of them has ever succeeded, despite earnest and enthusiastic effort. * * *. There is no teacher like experience. There is no need even to reason about it. We know that weekly premiums are a success ; we know that monthly installments of annual premiums are a failure. * * *. When you call for a monthly premium you won't get it — it is either too large or too small. The industrial policyholders will pay weekly, but not monthly; the more well-to-do will pay quarterly but not monthly."^^ »« Haley Fiske, Vice President of the Metropolitan Life Insurance Company, Industrial Insurance, in the Charities Review, March, 1898. 497 SPECIAL REPORT IX. GROUP LIFE AND GROUP DISABILITY INSURANCE. (By William Duffus.) I. Introductory. Group insurance, as it is written to-day, is essentially a plan for selling insurance at wholesale rates to employers to cover the lives or persons of employees. Usually, although not always, group insurance is issued on a single or "blanket^ ^ policy which covers the entire group of employees, and provides or assumes provision for the collection of premiums from the employer and the distribution of indemnities by him to beneficiaries. Sometimes, however, group insurance is written in the form of an individual policy for each individual in the group and sometimes the indemnities promised are payable by the insurance com- panies directly to beneficiaries without passing through the hands of the employer.^ As a rule the employer pays the entire premium — one insur- ance company which is a leader in the sale of group life insurance adver- tises its group insurance as being for sale only on these terms — but employees sometimes pay part of the premium and there are a few cases on record where benefit associations of employees are paying the entire premium.^ The group plan is used chiefly in life insurance but it is also used by a few companies in the health and accident insurance busi- ness and its adoption is being considered by others. The Commission deemed an investigation of group insurance desirable for two reasons: first, group life insurance provides indemnities 'for wage-earners which may be used to cover the ordinary expenses of the last illness and burial in addition to the cost of temporary maintenance of dependents; and, secondly, group health and accident insurance, if its development con- tinues, may constitute an important partial solution of the health insur- ance problem of the wage-earner. II. Group Life Insurance. (1) History. — At present, in so far as volume of business is con- cerned, group life insurance, as suggested above, is much the more important form of group insurance. In fact the term "group insurance'' is frequently used without modification or explanation to refer solely to group life insurance. * Edward B. Morris, Actuary Life Department, Travelers Insurance Company, states that "one company in particular has made a specialty of writing group insurance on the basis of individual contracts." Proceedings Casualty Actuarial and Statistical Society of America, 1916-1917, Vol. 3, p. 151. 2 Attempts have been made to apply the group plan to the insurance of groups not composed of the employees of a single employer, as, for example, the members of a local lodge of a fraternal order, but insurance of such groups is impossible under the statutory definitions of grou 3 life insurance adopted in certain stages and the definition approved by the National Convention of Insurance Commissioners (see Note 1, p. 9). —32 H I 498 "Group life insurance is the result primarily of a demand from large employers of labor, aided in its development by representatives of insur- ance companies, for a form of life insurance adapted to the needs of their employees and available for them in quantity lots at quantity prices. These employers have felt that the "ordinary" and "industrial" forms of life insurance sold on individual policies were either beyond the economic reach of their employees or, if within their means, that they were inadequate to their needs. Plans for the insurance of em- ployees are by no means new among employers." "The files of most insurance companies will prove that a great deal of time has been spent on problems that pertain to this subject — time very poorly spent if the premium return were considered. Such insur- ances originally involved the issuance of individual contracts with med- ical examination. The cost invariably proved to be greater than the employer cared to stand and most of such propositions remained in the correspondence files of the companies."^ Two motives appear to have been responsible for the action taken by employers who have made use of group insurance in their establish- ments. The first is a humanitarian motive — a genuine, largely dis- interested desire to be helpful to employees in their efforts to attain greater economic security for themselves and their dependents. It is impossible of course to measure the force of this motive or the extent to which it has operated but there can be no question that it has been of very great importance in the minds of those employers who have come to regard themselves as being, in a broad sense, trustees for the public. The second motive is economic — a desire to improve the rela- tions existing between the employer and his employees in order to pro- mote the greater prosperity of the business. Employers who advocate group life insurance for the sake of its economic advantages to them- selves lay greater stress on the effect which they believe it has in reduc- ing the labor turnover and in developing a greater interest among employees in the welfare of the business establishment in which they are employed. The advantages claimed for group insurance are discussed in detail in another portion of this chapter. The first use of the group plan in life insurance is said to have been made when a group policy was written by "the first chartered American life insurance company on seven hundred coolies during their transpor- tation from China to Panama.* This initial application of the plan appears to have had little, if any, influence in the subsequent history of life insurance. The group life insurance of to-day seems to be largely, if not entirely, a development of the past decade. The Travelers Insurance Company of Hartford, Connecticut, has been credited with the preparation "in the fall of 1910 (of) a group contract of the One Year Renewable Term plan in blanket form * * * involving prac- tically all the principal features of the present-day contract" but a group » Edward B. Morris, Actuary Life Department, Travelers Insurance Company, "Group Life Insurance and its Possible Developments," Proceedings Casualty Actuarial and Statistical Society of America, 1916-1917, Vol. 3, pp. 149-150. * Ralph H. Blanchard in chapter on "Group Insurance" in Huebner's Life In- surance, p. 304. Hon. Burton Mansfield, Insurance Commissioner of Connecticut, states that "two or three so-called group policies were issued many years ago covering the lives of coolies in order to indemnify sjiippers transporting these coolies over the high seas." Proceedings National Convention Insuurance Commis- sioners, 1912, p. 235. 499 insurance contract which the Equitable Life Assurance Society of New York City wrote for Montgomery Ward and Company of Chicago in July, 1912, is "generally known as the first important contract of this kind actually issued.^ The group insurance plan, as it is usually applied to life insurance, reduces the cost of insurance by eliminating the soliciting and the med- ical examination of individual "risks'^ and by providing for the collec- tion of premiums in lump sums from employers instead of separately from individual wage-earners.^ The details of the plan will be explained in subsequent sections of this chapter; at this point it is sufficient to state that the comparatively low cost of group life insurance is largely responsible for its increasing use. For a number of years after 1912 the growth of the group life insurance business was slow. Only a few insurance companies were ''pushing'^ the group plan; other companies were doubtful of its practi- cability or of its desirability as an addition to other plans of insurance in which they were interested. Many employers were (and still are) sceptical of the merits claimed for the plan as a specific for "industrial unrest" and kindred ills; several State superintendents or commissioners of insurance refused to permit the sale of group insurance within the states over which they had jurisdiction or postponed action on petitions for the approval of group policy forms, '^ and the laws of a number of states forbade the insurance of "any life without a medical examination'^ or placed other obstacles in the way of the promoters of the plan. The insurance companies which were interested in the possibilities of group insurance continued, however, to urge its adoption by large employers and the efforts of the insurance companies were re-enforced by the efforts of original adherents or converts to the plan among employers who preached its merits to fellow employers. The growth of group life insurance in the United States during the first five years of its history has been summarized as follows by Mr. H. Pierson Hammond, actuary of the Connecticut Insurance Depart- ment, in an address delivered before the National Convention of Insur- ance Commissioners, August 28, 1917 : "By far the greater proportion of group insurance in the United States has been written by less than ten insurance companies. These companies are financially strong and efficiently managed * * *. "As will be seen in the following table, group insurance starting in 1912, without any appreciable momentum derived from previous expe- rience, has developed until on June 30, 1917, there were approximately 325,000 employees in this country insured under this plan for over $250,000,000 in the aggregate, an average of over $760 per employee insured. If we assume that an average family consists of five persons, or possibly four, it is safe to say that probably one million five hundred thousand individuals are directly interested in this form of insurance. " Edward B. Morris, paper cited above, pp. 150-151. * See pp. 507 below for a statement of modifications of these details in some policies. ''Proceedings National Convention Insurance Commissioners, 1912, p. 72; 1917, pp. 125 and 221. 500 In force. Number of employees. Amount of insurance. Dec. 31, 1912 Dec. 31, 1913 Dec. 31, 1914 Dec. 31, 1915 Dec. 31, 1916 June 30, 1917 11,450 30, 125 56,625 105,000 202,000 325,000 $ 13,083,000 28,235,000 50, 605, 000 83,920,000 155,300,000 250,000,000 "These figures indicate that the volume of group insurance has steadily increased since 1912. If you will compare the business in force at the end of 1916, with the corresponding figures as of June 30, 1917, you will see that a large volume of insurance is being written this year (1917)^'« In order to get as complete, as recent and as authentic information as possible regarding the nature and growth of group life insurance in the United States and in Illinois the Commission addressed a ques- tionnaire to all life insurance companies in the United States known or thought to be writing group insurance. The following companies furnished the information requested: Aetna Life Insurance Company, of Hartford, Connecticut; Equitable Life Assurance Society of the United States, of New York; Guardian Life Insurance Company of America, of New York; Metropolitan Life Insurance Company, of New York; Prudential Insurance Company of America, of Newark, New Jersey ; and the Travelers Insurance Company, of Hartford, Connecticut. One company, the Guardian Life Insurance Company of America, re- ported that it had discontinued writing group insurance; the five other companies enumerated were all engaged in the business at the time they made their reports to the Commission. The Commission has been unable to learn how many companies other than those named above have written or are now writing group life insurance but it feels safe in saying that by far the greater part of the group life insurance which has been written in the United States has been sold on policies issued by the companies named. The six life insurance companies which provided the Commission with information regarding their group life insurance business reported the year of entering upon the business as follows : one company, 1911 ;^ one company, 1912; two companies, 1913; and two companies, 1916. The same companies reported the year in which their first group life policy was written in Illinois as follows : one company, 1912 ; one com- pany, 1914 ; two companies, 1915 ; one company, 1916 ; and one company, 1918. Three of the six companies reported that they write group health and accident insurance as well as group life insurance. The total number of groups covered on December 31, 1917 by insur- ance issued by the six companies was 1,148, including about 336,000 employees insured for an aggregate of about $255,000,000.^° A com- parison of these figures with data shown in the table above will indicate the relative importance of the six companies in the group life insurance business of the United States. *The Economic World, July 13. 1918, p. 57. •Compare with statement quoted from Edward B. Morris, p. 3. above. "Although not absolutely accurate these figures are approximately correct. 501 (2) Group life insurance in Illinois. — Five of the six companies mentioned above reported group life insurance policies outstanding against them in Illinois on December 31, 1917." The following table summarizes data presented to the Commission by these five companies: GROUP LIFE INSURANCE WRITTEN FOR EMPLOYERS IN ILLINOIS, 1913-1917.* Year ending Dec. 31. Number of groups insured. Number of employees covered. Amount of insurance. Total of premiums collected. 1913 2 t31 t66 333 442 707 3,129 24,877 $ 277,500 683,634 1,011,352 2,809,676 20,092,851 % 72,366.15 63.953.42 1914 1915 59. 372. 96 1916 83,604.62 159,757.45 1917 * The data shown in columns 2, 3 and 4 represent the policies in force on December 31 of the years indicated. These data are only approximately correct because of differences in the methods of compilation used by different companies. t Two of these groups include employees of an industrial life insurance com- pany which insures its own employees. The most striking feature of the above table is the very rapid increase indicated in the use of group insurance in Illinois since 1915. Comparisons of the two tables above shows that the increase has been much greater in Illinois than in the United States as a whole. However it should be noted that on December 31, 1917, only 24,877 of the wage- earners of Illinois were covered by the group insurance shown in the table. The average amount of insurance per employee insured on December 31, 1917, was about $808. The average premium collected per employee cannot be calculated from the data presented in the table because of the fact that these data do not show the varying numbers of employees covered during the year, but it is evident from the table, as will be shown more definitely later,^^ that the pl-emium per employee is com- paratively small. The average number of employees per group, it will be noted, increased greatly from 1916 to 1917; to be exact, the increase was from 101 members per group on December 31, 1916, to 377 mem- bers per group in 1917. The reports from the five companies covered by the table show that all of the group life insurance contracts written by them in Illinois in 1917 involve the payment of the entire premium by the employer. De- tailed statements received by the Commission from 24 employers in Illinois who have adopted the group life insurance plan show that in each case the employer pays the entire premium. It is therefore safe to assume that there are few, if any, establishments in Illinois where employees contribute money to the payment of premiums on group life insurance. The reasons for the assumption of the entire premium burden by employers (in so far as the making of money payments is concerned) appear to include the following: first, the cost per employee of the insurance is comparatively small, averaging probably not more than "The sixth company began writing group life insurance in Illinois in 1918. '^ See pp. 510 below. 502 $1 per month in most establishments and in many considerably les™ second, the division of the premium between employer and employee involves difficulty in making the plan universal in an establishment, whether participation in the plan is made optional or compulsory on the part of the employee; third, group insurance is probably more effective as a means of getting the good-will of employees if the pre- mium is paid entirely by the employer than it is if the employees are compelled to pay part of the premium; and fourth, the advocates of group insurance contend that it ''pays for itself by the increased loyalty and efficiency of employees which is alleged to follow the adoption of the plan. (3) The group life insurance policy. — Usually, as has already been stated, group life insurance is issued on a "blanket" policy which covers the lives of all members in the group.^^ The most common type of group life contract is the one-year renewable term contract. Occasionally group life insurance is written on other types of contract, such as the five or ten-year term, the endowment or the whole-life plan. /fOt the 24 em- ployers in Illinois who furnished the Commission with detailed infor- mation concerning group life insurance plans which they have adopted, four stated that the policies which they hold are "whole-life" policies but it is possible that in some cases this statement was made through a mis- apprehension as to the distinction between whole-life policies and renew- able term policies which may be continued from year to year during the greater part of a life time. The general preference given the one-year contract has been explained as follows : "From the standpoint of the employer the renewable term plan has the advantage of covering these insurances at the lowest possible cost during the period in which the employer desires the coverage, namely, during continuance of employment. T e int iii&aiiai»ce has the further merit of not involving surrender values, or causing the employer to pay the extra sum required on the whole life level premium plan, when it is a foregone conclusion that in many cases the employment will be only temporary. While the individuals in any one group on the renewable term plan will of course be rated each year at a successively higher rate, it does not necessarily follow that the aggregate rate of the group will increase materially. Conditions of active employment in themselves require certain age distributions which practically assure an aggregate premium on the term basis which will vary within narrow limits from year to year."^* "The National Convention of Insurance Commissioners have attempted to standardize the group life insurance contract by the recommendation of certain standard provisions and the adoption of the following definition of group life insurance : "Group life Insurance is the form of life insurance covering not less than fifty employees, with or without medical examination, written under a policy issued to the employer, the premium on which is to be paid by the employer or by the employer or employees jointly, and insuring only all of his employees, or all of any c-luss or classes thereof determined by conditions pertaining to the emplovment lor amounts of insurance based upon some plan which will preclude individual selection for the benefit of persons other than the employer, provided however. that when the premium is to be paid by the employer and employee jointly and the benefits of the policy are offered to all eligible employees, not less than seventy- five per cent of such employees may be so insured." "William J. Graham. "Group Insurance" Transactions of the Actuarial Society of America, 1916, Vol. XVII, Part II, No. 56, p. 267. 503 Group life policies may be participating or non-participating^ that is, they may or may not provide for the distribution of dividends to the policyholder (the employer). In the non-participating policies the insurance company "guarantees the rate" for a term of years, usually five or ten but sometimes twenty/^ that is, the company guarantees, in effect, that the premium charged annually or at other intervals shall not exceed a sum agreed upon between the company and the policyholder. At the end of the term of years specified the insurance company may, if it sees fit, readjust the premium, increasing or decreasing it as ex- perience with the risk and other considerations may warrant. In participating policies the company may "guarantee its gross rate in perpetuity, adjustments to experience being effected by the payment of dividends,"^® or it may provide as in the non-participating policies for a periodical readjustment of rates. Some group life policies are renew- able annually at the option of the employer for 50 or more years^ subject only to the right of the insurance company, in policies where the right is reserved, to revise the premiums at the end of the guarantee period agreed upon; other policies contain no time limitation on the renewal privilege.^^ In either case the employer may, in effect, cancel the con- tract at will on any anniversary by simply discontinuing the payment of premiums. The advantage of the guaranteed premium rate and the renewal privilege to the employer is that it enables him to make long-time cal- culations with respect to his group insurance costs. Provisions of this kind are essential aids to the salesman of group life insurance for an employer may reasonably feel that it would take several years to demon- strate conclusively the value of group insurance as a means of develop- ing good-will and increased efficiency among his employees. The right of the employer to discontinue the policy at will on any anniversary permits him to drop group life insurance altogether if he thinks that it is not worth its cost or to substitute a cheaper or better policy for the one he holds whenever a cheaper or better policy appears on the market. This possibility has led insurance companies writing group insurance to scale down rates "voluntarily" in a considerable num- ber of cases on group policies outstanding even though the readjustment anniversary of the policy had not been reached. This action is perhaps one of the factors responsible for the very small percentage of cancel- lations among group life insurance policies.^^ In its details the group life insurance policy is similar to life in- surance policies issued to individuals except where special provisions are necessary to adjust the contract to the group plan. ^5 Edward B. Morris, paper cited above, p. 156. "Ralph H. Blanchard in chapter on "Group Insurance" in Huebner's Life Insurance, p. 307. "Edward B. Morris, paper cited above, states, pp. 158-161, that as far as he has been able to learn "no company actually provides for cancellation inside of fifty years" and that "some of the companies do not even limit the contract in this respect." Sample policies submitted to the Commission by some of the companies writing group life insurance support this statement. 18 Edward B. Morris, paper cited above, remarks, on page 157, that it is "sur- prising what a relatively small number of group contracts have been cancelled by the employer" and states that of some 300 group policies issued by the Travelers Insurance Company up to the time at which he wrote "but two contracts have been discontinued and these for reasons which have no bearing on the desirability of the insurance." 504 "One contract, or group policy, is issued to the employer, which makes reference to necessary supporting detail of each life covered, con- tains schedules of rates — and where other than term, schedules of loan and surrender values — for each age, and otherwise conforms to provisions for similar insurances on individual lives. Supplementary certificates of insurance, commonly issued to each member of the group, state the fact of the insurance, the name of the individual insured, the amount of the insurance, the name of the beneficiary,, and the conditions under which the insured continues in force/^^^ The following is an outline of the principal provisions of the group life insurance policy used by one company which writes group life insur- ance in Illinois. The outline is reproduced exactly as it was furnished the Commission by the insurance company except that the name of the company is omitted and the word "Company'^ inserted instead of it. Group Life Insurance. a brief outline of the principal provisions of the policy. Plan. — There must be determined upon some general plan of in- surance based upon salary, length of service, age or other general con- dition. The insurance may be arranged to increase automatically at stated intervals, on account of lengthened term of service, or on account of increase of salary. No medical examination of the persons insured is required. Application. — An application is made on a blank provided by the company, in which is set out the plan determined upon. On anothei blank are set down the name, address, residence, sex, occupation, length of employment of each person to be insured, the initial amount of insur- ance, and the name and relationship of the beneficiary. Policy. — One policy is issued to the employer and attached is a list of employees insured and amount carried for each. The insurance for men and women is precisely the same. Certificate. — A certificate is issued by the insurance company, to each person insured, stating the amount of his or her insurance and the name of the beneficiary. It states that the insurance will only be paid in case death occurs while the insured is in the employ of the employer securing the insurance. Premium. — The premium is payable monthly, but, if desired, it may be arranged to be paid yearly, half or quarter yearly. It is the sum of the individual premiums computed according to a schedule embodied in the policy. Period of grace. — Thirty-one days' grace are granted the employer for payment of each premium after the first. Policy renewable. — If the policy is issued on the One-year Term plan, the employer may renew it each year at rates increasing with the ages, but the company guarantees that schedule of rates shall not be changed for five years. Insurance — how payable. — At death insurance is payable to bene- ficiary designed by insured. "William J. Graham, paper cited above, p. 267. J 505 Dwahility benefits. — Should an employee become fully and perman- ently disabled before attaining the age of 60 years, no further premiuin is payable in respect of him; his insurance matures and the Company will pay the amount of it in installments, with interest, over a period of time, and should he die before they are all paid, will pay the remaining installments to his beneficiary. Mistatement of age. — Correction to be made in amount of premium for error caused by mistatement of age of an insured, but the amount of insurance payable to the beneficiary remains unchanged. Insurance to he discontinued. — Employer to report names of persons upon whom insurance is to be discontinued, such discontinuance to take effect on the first day of the month after receipt of such notice. If premiums are payable otherwise than monthly all unearned premiums paid on such discontinued insurance will be refunded to the employer. Insurance of new employees. — jN'ew employees may, from time to time, be embraced in the policy on the same basis on which the insurance w^as originally issued. Military or naval service. — If any insured engages in military or naval service in time of war, his insurance ceases, but within thirty-one days thereafter he may have issued to him a separate policy, in certain forms, on paying the premium applicable to him. Change of beneficiary. — Any insured may change the beneficiary to receive his or her insurance. Participation. — The policy is a participating one and the company will annually ascertain and apportion any devisable surplus accruing to the individual insurances under the policy and will pay same in cash to the employer, or, if desired, apply in reduction of any premium then due. The above outline is in large part self-explanatory and comment and additional explanation will be made only where necessary. The amount for which a given employee is insured is usually either the amount of a j^ear's wages or salary, with a maximum limit of from $3,000 to $5,000,2^ or a scheduled sum which increases by stipulated increments with length of service. Sometimes, however, the amount of insurance is a flat sum, as, for example, $1,000, which applies to all employees alike, regardless of yearly earnings or length of service, and sometimes it varies according to sex or marital condition. The plan under which the insurance of the employee increases with length of service is illustrated by the following schedule taken from a statement made to the Commission by an Illinois employer : For employment less than 3 months No insurance For employment 3 months and less than 1 year I 500 For employment 1 year and less than 2 years 600 For employment 2 years and less than 3 years 700 For employment 3 years and less than 4 years 800 For employment 4 years and less than 5 years 900 For employment 5 years and less than 6 years 1,000 For employment 6 years and less than 7 j^ears 1,100 For employment 7 years and over 1,200 (maximum) Some of the schedules used by other employers in Illinois who pro- vide group life insurance on the length of service basis vary from the ^ Office employees, foremen and superintendents and even general officers of a corporation may be covered by the group insurance plan. 606 foregoing schedule in the minimum length of service accepted the length of time required to reach the maximum amount of insurance as entitling an employee to insurance, and the amount of the initial insurance. Of 16 employers reporting the provision of insurance on the length of service basis, one reported a minimum length of service requirement of 30 days, one a requirement of one month, 7 a requirement of 3 months, one a requirement of 4 months and a 6 a requirement of 6 months. The initial insurance provided employees was reported by 14 employers ; nine start the insurance for their employees at $500, two at $300, one at $250, one at $200, and one at $150. The maximum insurance pro- vided employees on the length of service basis was reported by 13 em- ployers, 9 of whom reported a maximum of $1,000, one each a maximum, respectively, of $2,000, $1,500 and $1,200 and one a maximum limited to the salary or wages of the employee. The maximum could be attained in the greater number of cases in 5 years but in some the time required was 6 or 7 years. It was indicated above that 16 of the 24 employers who furnished the Commission statements concerning the group life insurance with which they provide their employees have adopted the length of service basis as the method of determining the amount of insurance for the individual employee. Four of the remaining employers reported that they insure their employees for the amount of a year's wages and one that it insures its employees for a fixed sum — the amount not stated. Three employers failed to make definite statement in the matter. The argument in favor of the length of service basis of determining the amount of an employee's insurance is obvious. Those who favor the adjustment of the amount of insurance according to the wages of the employee, with a maximum limit of $3,000 or $5,000, contend, however, that their plan is more satisfactory than the first mentioned plan. "It takes automatic account of all changes in the payroll in the way of increases or decreases, and there is no discrimination between individuals other than that which already naturally exists. All em- ployees are insured according to a standard already in existence which is familiar to them. The salary received by an employee is based not only on the quality and character of his service but upon length of service as well. When a new employee is engaged at the same salary as that paid to an old employee, it is a fair assumption that the new employee is a more valuable one."^^ The statement in the outline that "no medical examination of the persons insured is required"^^ can be explained best by describing the method by which the groups covered by group life insurance are selected. This has been done by an authority on group life insurance as follows: ^ "The cardinal principles of group selection are, roughly : (a) To obtain a body of risks selected for purposes requiring physi- cal and moral fitness ; (b) To see that the group is acceptable as a whole, or in classes not inferior in point of insurability to the group as a whole ; »* Ralph Barnard Trousdale, of the Equitable Life Assurance Society, Annals American Academy Political and Social -Science, Vol. 70, pp. 94-95, March, 1917. " Some companies have required a medical examination for new employees added to the orit^inal group. See Ralph H. Blanchard's chapter on "Group Insur- ance" in Huebner's Life Insurance, p. 305. 507 (c) To grade the risk properly at the standard rate or at a com- mensurate extra premium rate for acceptable additional hazard. "The mere statement of these three general subdivisions governing selection narrows down the acceptances of groups without medical exam- ination closely to (a) employees of one employer; (b) where all or sub- stantially all lives must be included in the group except as certain whole departments or sexes or probationers are excluded; and (c) where the grade of employees and the occupational and incidental hazards measure up to required standards or else can be adjusted by commensurate extra premium ratings within the range of reasonable additions to the stand- ard rates. "Careful inspection of each group is made to determine the facts as above outlined. Such inspections include investigations of employees and plants. Sex, nationality, wage, sobriety and requirements for em- ployment are important personal factors. Trade dusts and trade dis- eases are important in character and in ratio to the number of the whole so exposed. The buildings and surroundings are studied with view to proper air, sanitation, hygiene, pure drinking water, etc., and with refer- ence to accident and panic hazards. "Group insurance must carefully guard against adverse individual selection. Hence the necessity for insuring the group on a basis which does not leave with the individual the power to decide whether or not he or she shall enter the group. This militates against the acceptance of a group in which the insurance is paid for by the individual employee. "An}^ attempt to apply group insurance to less than the whole avail- able class to whom it is offered involves the danger of adverse selection entering to the degree of making the whole uninsurable. An even more vital point of insurability would be involved if individuals were privi- leged to choose to continue in the group or not. Again the group plan contemplates the elimination of individual solicitation. Where indi- vidual action is necessary to bring the whole to a point of insurability, a soliciting cost is introduced that militates against the practical applica- tion of the group idea. For these reasons group insurance is in a large degree restricted to the insurance of employees of one employer where the employer pays the entire premium.^^^^ The minimum number of individuals who will be accepted without medical examination for group life insurance has commonly been fixed at 100 by the life insurance writing group insurance although in one or two states a minimum of 50 lives has been recognized-* and this mini- mum has been accepted as sufficient by the National Convention of Insurance Commissioners. In practice group life insurance has not always been restricted to groups complying with^ the minimum require- ments as to numbers. "As a matter of fact, group policies are issued on less than one hundred lives by giving a modified form of medical examination. This modified examination increases in severity as the group shrinks from the full hundred until full medical examination and rigid judgment of the same is accorded all risks where the number decreases to the arbitrary 23 William J. Graham, paper cited above, pp. 264-265. 2* H. Pierson Hammond, Life Insurance in Groups, 1912-17, address before National Convention of Insurance Commissioners, August 28, 1917, reprinted in The Economic World, July 13, 1918, p. 57. 508 minimum — usually twenty-five lives — required for any form of group or blanket insurances. Necessarily such modified groups may exclude one or more lives upon the medical showing."^^ • The number of employees in a group will necessarily vary from time to time as deaths, withdrawals and additions occur and the group life insurance policy accordingly makes provision for readjusting the pre- mium to compensate for the changes in numbers, ages, amounts of insur- ance for individual employees, and other details. As the outline states, the premium paid by the employer "^is the sum of the individual pre- miums computed according to a schedule embodied in the policy.'^ Employees for whom group life insurance is purchased are given the right of naming their beneficiaries. Employers sometimes ask insur- ance companies to name them as the beneficiaries of the employees for whom they purchase insurance in order that they may administer claims when they arise but insurance companies do not consider it good practice to grant such requests because of the possible moral hazards involved in some cases and the legal questions of insurable interest which might arise. ^*^ The insurance companies, however, commonly send the checks or drafts used in the payment of claims to the employer for distribution by him to the beneficiaries. The insurance payable on the death of an employee may be paid to his beneficiary either in a lump sum or in installments as is the case with life insurance on individual policies. When payable in installments payments are often spread over a period of twelve months, instead of over a longer period, with the idea of continuing the employee's wages, or a considerable portion of them, after his death until his dependents have had an opportunity to arrange for their own support. The disability benefits for which some group life insurance policies provide are similar to those which have been introduced in recent years in many life insurance policies sold to individuals. The following dis- ability clause from a sample group life policy submitted to the Commis- sion by one of the insurance companies which writes group life insurance in Illinois is fairly typical: Si.^ months after proof is received at the Home Office of the com- pany (that is, the insurance company) that any person insured hereunder has become wholly, continuously and permanently disabled and will for life be unable to perform any work or conduct any business for com- pensation or profit, provided that such disability occurs while the insur- ance upon such life is in full force and before 'the insured has attained the age of sixty years, then, in lieu of all other benefits herein provided, the company will waive further payment of premium for the insurance upon such life and will pay immediate disability benefits. The mode of settlement shall be that one of the following optional methods that shall be designated by the employer. Fir^f.— Payment of the full sum insured in installments to the person disabled. The installments shall be payable monthly, quarterly, semi-annually, or annually, and shall cover a period of fivej ten, fifteen or twenty years, the first payment to be made immediately. Any install- ments rema ining unpaid at the death of the insured shall be payable "William J. Graham, paper cited, Note 1, p. 10, p 265 "William J. Graham, paper cited above, p. 269. 509 as they become due to the beneficiary designated in the application for this policy, who shall have the right to commute such remaining install- ments into one sum on the basis of interest at three and one-half per cent (31/2%) per annum. TABLE SHOWIJ^G THE AMOUNT OF INSTALLMENT AND TERM FOR WHICH IT WILL BE PAID. These amounts are based on a single payment of one thousand dol- lars of insurance. Installments payable for insurance of a greater or less amount shall be proportionate. Years. Annually. Semi- annually. Quarterly. Monthly. 5 $214. 00 116.00 84.00 68.00 $107.00 58.00 42.00 34.00 $53.50 29.00 21.00 17.00 $17.83 10 9.67 15 7.00 20 5.67 When an employee terminates his employment the insurance com- pany, upon receiving notice from the employer, will discontinue the in- surance of the employee and credit the employer with the unearned portion of any premium paid on account of the employee. If an em- ployee is temporarily absent from duty because of illness or on a leave of absence granted by his employer the latter usually continues the insurance of the employee. If an employee is "laid of!" temporarily because of lack of work the employer may be or may not continue the insurance. Illinois employers who have adopted group life insurance have done so, with few exceptions, during the present period of pros- perity and most of them have had no occasion to adopt a settled practice with respect to the carrying of insurance for emploj^ees temporarily idle because of lack of work. The policies which employers adopt in this matter when the occasion for decision does arise in the future will be of great* importance in determining the value of group life insurance as an agency for meeting the need of the wage-earner for insurance. When an employee retires from employment because of old age or because of disability not covered by a disability clause in the group policy the employer may, if he desires, under the terms of some group policies^^ continue the insurance of the employee. The privilege of applying to the insurance company writing the group policy for individual insurance without medical examination may be given employees discontinuing employment if the employer so desires. Usually the privilege must be exercised within 31 days after the termin- ation of employment. The employee is usually permitted to select any type of policy except a term policy. He must, however, pay the regular rate for his attained age and the conversation privilege is therefore of no value to him except as a means of escaping a medical examination which might debar him from insurance. Most of the employers who presented data to the Commission with respect to group life insurance plans which they had adopted stated that their policies contained pro- 2^ This may be possible under all group life insurance policies now in use but the absence of complete data forbids a positive statement to that effect. 510 visions permitting employees withdrawing from service to take out individual life insurance policies without medical examination. The data show, however, that very few employees have availed themselves of this privilege. One employer explained that although "employees discharged or leaving the firm would be entitled to individual policies without medical examination" the firm had not "pushed this feature." Illinois experience with the conversion privilege seems to be in line with the experience in other states. (4) The cost of group life insurance. — Group insurance, as was said in the opening statement of this study, is essentially insurance at wholesale. It is insurance in quantity lots which can be sold at quantity prices because of the elimination or reduction of the expenses which have to be met when insurance is sold in the ordinary way on individual policies. "Large economies are achieved under the group system. Agency work is reduced by being centralized. Individual members of the group are not solicited. Commissions and renewals are fixed at about one- third of the usual rate for the same form of individual insurance. The elimination of all accounting, correspondence and premium collection with the individual greatly reduces the cost of caring for the business. All accounting is centralized in the one periodical statement to the em- ployer. In this statement the changes occurring during the period are carried forward in total only and without detailed restatement."^^ The elimination, in most cases, of the expense of individual medical examination of the candidates for insurance should also be mentioned for this is an important item in the first-year expenses on individual insurance policies. Another reason for the comparatively low rates at which group life insurance is sold is the expected favorable mortality resulting from the care used in inspecting groups for whom group insurance is sought,"^ and the relatively high standards of health and physical fitness fre- quently demanded by the nature of the employment. "The employer is vitally interested in the physical selection of his employees and there is a growing disposition among progressive estab- lishments to add some form of medical examination to the usual re- quirements. In certain establishments this medical examination far exceeds in comprehensiveness the physical examination for life insur- ance, including such important points as hearing, eyesight and careful examination of teeth. Even where there is no medical examination of the applicant for employment there is always a shrewd and more or less unconscious phy- » William J. Graham, paper cited, p. 270. Edward B. Morris, paper cited above, p. 153, explains that group life insurance is usually sold by salaried specialists In group insurance from the home office of the insurance company and that the commissions which have been paid "have hardly averaged as high as commissions for renewals on life policies — perhaps 5 per cent." " Ralph H. Blanchard in chapter on "Group Insurance" in Huebner's Life In- surance, p. 306. A study of the "Joint Mortality Experience of the Aetna Life and Travelers Insurance Companies on Group Policies," by E. E. Cammack and E. B. Morris, will be found in a recent number of the Transactions of the Actuarial Society of America. This study, a copy of which was furnished the Commission in advance of publication, indicates that the actual mortality has generally been favorable in groups in some industries and unfavorable in groups in certain other industries. 511 sical size-up by the employer. Employment departments select healthy people in order to get the work done properly. The physically inferior have smaller chance of employment in modern industries than the physi- cally strong. Futhermore, if employed, the test during the first few days of competition with the physically strong serves to adjust the em- ployei'^s misjudgment where the risk has been over-rated on appear- ance."^° The premium rates for group life insurance on the lives of em- ployees of a given age issued on a given type of policy will vary from establishment to establishment according to the nature of the group hazards, occupational and environmental, which are believed tp influence the mortality within the group. It is said that premium rates also vary somewhat according to the exigencies of competition between the insur- ance companies which write group life insurance. The following table, taken from a sample policy furnished the Com- mission by an insurance company which writes group life insurance on the non-participating basis, shows the group rates to be charged according to the terms of the policy, for employees for each age from 16 to 95, inclusive : TABLE OF TERM PREMIUM RATES FOR ONE THOUSAND DOLLARS OP INSURANCE. RATES FOR INSURANCE OP A GREATER OR LESS AMOUNT WILL BE PROPORTIONATE. Age nearest birthday. Annual premium. Age nearest birthday. Annual premium. Age nearest birthday. Annual premium, Age nearest birthday. Annual premium. 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 $8.16 36 $ 9.00 56 $ 22.89 76 8.20 37 9.12 57 24.52 77 8.24 38 9.26 58 26.38 78 8.28 39 9.43 59 28.48 79 8.31 40 9.64 60 30.92 80 8.36 41 9.90 61 33.71 81 8.39 42 10.22 62 36.86 82 8.43 43 10.^4 63 40.35 83 8.48 44 11.13 64 44.19 84 8.51 45 11.67 65 48.38 85 8.56 46 12.25 66 52.92 86 8.59 47 12.88 67 57.81 87 8.63 48 13.57 68 63.05 88 8.65 49 14.37 69 68.87 89 8.67 50 15. 26 70 72.30 90 8.70 51 16.31 71 78.24 91 8.73 52 17.47 72 84.64 92 8.78 53 18.70 73 91.61 93 8.84 54 19.98 74 99.20 94 8.91 55 21.37 75 107.46 95 $116.31 126. 09 136. 56 147. 85 160. 19 173. 46 187. 78 203. 15 219. 79 237. 60 256.69 277. 18 299.07 321. 76 345 86 371. 35 398. 24 426. 65 456.33 487. 41 It is not possible to say, on the basis of information available to the Commission, how closely the above rates are adhered to in actual practice by the company publishing them. The fact that these group rates are actually higher for the ages 16 to 30 inclusive and 46 to 57 inclusive than the rates published in the Unique Chart for 1917^^ for individual, *»Wm. J. Graham, paper cited above, p. 272 ^ The Unique Comparative Chart of Premium Rates, of the Regular Life In- surance Companies, 1917-18. Sampson, Dawe, Boston, Mass. Some of the rates shown in the chart for the individual policies mentioned are as follows: age 16, $7.79; age 20, $7.94; age 25, $8.82; age 30, $8.61; age 35, $9.23; age 40, $10.17; age 45, $11.73; age 46, $12.19; age 50, $14.79; age 55, $20.69; age 57, $24.35; age 58, $26.57. 512 non-participating, renewable and convertible one-year term policies issued by the same company is hardly to be explained by the inclusion of a disability clause in the group policy and its absence in the individual policy. It seems probable that the rates shown in the table are designed to apply to the poorer group risks accepted by the insurance company and that lower rates are charged for the better risks. Otherwise there would be no advantage to the employer in purchasing a group policy instead of individual policies for his employees except in the possibility of covering employees who might be excluded by the individual medical examinations and the saving of more or less clerical work and labor of supervision. The table of rates is included in this discussion not be- cause it stows accurately the group rates usually paid, but because it illustrates the way in which the group rate is obtained and the way in which the rates on individual employees increase with their ages. The rapid increase of the per employee cost of group life insurance during certain age groups, as, for example, from 50 to 65, is a fact which must be borne in mind in discussing the merits of group life insurance on the one-year renewable term plan as a partial solution of the problem of meeting the wage-earner^s need for insurance. The cost of group life insurance is frequently stated by the insur- ance companies which write this form of insurance in terms of a per- centage of the employer's payroll or a percentage of the total amount of insurance purchased for the group, if this differs from the amount of the payroll. The estimates most frequently made range from less than one to one and a quarter per cent of the payroll or total amount of insurance. "For preliminary purposes, and before the foregoing information (that is, information concerning details of the group risk) is available, the rate is usually quoted as one dollar per month for each thousand dollars of insurance. On a percentage basis, this w^ould amount to a premium of 1.2 per cent on the total amount of insurance."^^ "A very satisfactory group plan can be secured for approximately ll^ per cent of gross payroll.'^^^ "There will be at some time a final inventory taken of each em- ployee. Are his years of loyal service not worth a charge of approxi- mately 1 per cent of his annual wage, to provide for at least another year's wage to his wife and children after his death and to represent the human element of wear and tear?"^* "In industrial plants policies providing insurance for one year's wages average in cost less than 1 per cent of the total payroll."^^ "The Equitable's experience with many group risks would place the gross estimate of cost of approximately 1^4 per cent. In the past the net cost has approximated 1 per cent on most groups of standard occupation. Translated into cost per 1,000, this means an outlay of per- '"Ilalph Barnard Trousdale, of the Equitable Life Assurance Society, article cited above, p. 95. " Lawrence C. Wood, representing the Equitable Life Assurance Society, Group Life Insurance, paper prepared for the Annual Meeting of the Natural Gas Associa- tio of America, May 16, 1916, p. 9. »* The Employer and the Employee, pamphlet published by the Travelers Insur- ance Company, p, 3. »» Group Insurance, pamphlet published by the Aetna Life Insurance Company, p. 4. 513 haps from 80 cents to $1 a month for most groups. The Equitable Group plan is a participating plan and premium refunds thus far paid back to the employer in the form of annual dividends have substantially reduced the gross premium cost."^^ Another estimate places the average cost of group life insurance, including, presumably, insurance issued on the basis of wages, the length of service basis and the uniform amount basis, at "not usually over two cents per employee per day/'^^ )^ (5) Advantages and disadvantages of grouy life insurance. — The advantages claimed for group life insurance are usually stated from the point of view of the employer for it is to the employer that the appeal must be made in finding purchasers for this type of insurance. The insurance companies make the appeal on two grounds. They call atten- tion, in the first place, t(3 _the c ommon lack of adequate provision or of | any, provision at all, for life insurance among wage-earners and urge resort to group life insurance for humanitarian reasons. The insurance companies contend, in the second place, that it j)ajs the employer as a ^ inatter of business, without any regard to humanitarian considerations, to purchase group life insurance for his employees. Much more use is made of the second argument than of the first, y Two assertions are made in developing this argument : first, that group life insurance reduces the labor turnover and second that it creates or increases good-will for the employer among the permanent employees. -■'_. The effect of group life insurance is therefore to increase the efficiency of employees and thus to pay for itself in increased output. "It may be properly suggested that the correct instruction to the accountant, when group insurance is purchased by the employer, no matter what the motive for its purchase may be, is ^debit payroll and credit cash^ for labor or service have been received and cash has been paid out."^^ "Group insurance is viewed as an expenditure for which adequate returns are secured, rather than as an expense.^'^^ "Group insurance attracts the desirable classes of labor. It appeals particularly to married men with families — the less migratory class — and from ahnost every point of view in days of extreme pressure this is the most satisfactory class of men to carry on the payroll. But what is just as important, group insurance helps to hold labor. Five minutes ^ consideration of the plan will convince and employer that this claim can be substantiated. The testimony of Aetna group insurance policy- holders is that the cost is more than offset by the resulting increase in efficiency, and by the reduction of loss involved in replacing trained and skilled employees — men accustomed to the practice and work of the factory — by new and untried hands.'^*" " Group Insurance at a Glance, pamphlet published by the Equitable Life Assur- ance Society, p. 2. • ""What is Group Insurance?" an article by J. A. Peck, reprinted from The American Hatter by the Travelers Insurance Company, 1918, p. 3. " The Employer and the Employee, pamphlet published by the Travelers Insur- ance Company, p. 2. ^ Group Insurance at a Glance, pamphlet published by the Equitable Life As- surance Society, p. 2. ^** Group Insurance, pamphlet published \>y the Aetna Life Insurance Company, p. 3. The italics are by the present writer. —33 H I 514 The claims made by the insurance companies for the efficacy of group life insurance as a means of increasing efficiency in establishments making use of the plan are sustained by opinions expressed by many employers as quoted in the advertising literature of the insurance com- panies. To get the views of Illinois employers known to be making use of group life insurance the Commission included a question relating to the effect of group life insurance on the labor turnover in the question- naire which it sent to these employers. Replies to the question were received from twenty employers. Of these employers six stated in substance that they were unable, because of their short experience with group life insurance or because of the abnormal labor conditions pre- vailing, to speak positively one way or the other of the effect of group life insurance on the labor turnover; seven stated in substance that, so far as they could see, group life insurance had had no appreciable effect as yet on the labor turnover ; and seven thought that the plan had been of some benefit in reducing the labor turnover or that it would prove of some benefit in this direction in the future. On the whole the opinions expressed by the Illinois employers above mentioned seem inconclusive; they merely prove, if they prove anything, that group life insurance has no magic power to produce the desired results instantaneously or to over- come all temptations in the form of higher wages, shorter hours or purely personal considerations that lead employees to leave their em- ployers and seek work elsewhere. Several of the employers who replied to the question with respect ^to the effect of group life insurance on the labor turnover described or discussed the attitude of their employees toward the plan. The follow- ing are receipts from the replies of these employers. "We consider the group insurance very effective among the Ameri- can class of help but rather indifferent among the foreign element, of which we employ quite a number.^' "Employees have generally shown indifference in accepting the policies, (benefit certificates), and in a few cases almost a refusal. How- ever, we have faith in the project and intend to continue it till some- thing like stable conditions are resumed.^' "■As a rule the employee and especially the Trades Union employee has not and does not take kindly to any proposition even though offered in the best of faith tending to benefit his condition by making him in- terested in the business of the employer either by the distribution of a bonus, percentage of profits, or otherwise. As soon as these bonus systems are put in effect the employees take it as a matter of course and as a part of their wages. They immediately notify their fellow- workers in other factories and members of the union in general and the result is a general increase in wages all along the line and the object of the benefit sought is defeated ; namely, the inducing of the employee to become more interested in the production end of the husiness. * * *. "Our employees are largely foreigners and while we believe many of them appreciate the insurance feature there are others who do not regard it in the light of any value to themselves; that is, they would probably leave our employ for the addition of a cent or two per hour of wage 515 increase, going to a factory where their insurance would not be carried rather than remain to work for the lower wage." "When this insurance was first presented quite a few (employees) were suspicious that the Company was trying to put something over on them (as they expressed it) etc., but we insisted on carrying them until we could prove our stand and as the first man to die was the principal objector and as his family did not have any money when his estate was paid the amount the deceased person was insured for, all came into line, many expressing appreciation of what the Company was trying to do." Other employers stated that their emloyees were "very much inter- ested" in the group plan or "very appreciative" of it. In general it would seem fair to conclude, on the basis of the in- formation available to the Commission, that the experience of Illinois employers with group life insurance has been too brief to determine the value of the plan as an antidote for "labor unrest." If we turn to the arguments advanced in favor of group life insur- ance from the point of view of the employee we find that there are two arguments to be considered : first, that group life insurance — now com- monly paid for by the employer alone — is provided not as a partial sub- stitute for wages but as an addition to wages and, second, that under the gFoup plan insurance is available for some employees who could not pass the medical examination required of applicants for individuaal insurance. The first argument is supported by the statement that employers who have adopted the group life plan have not reduced wages when they put the plan into operation. The second argument requires no proof, but the argument is re-inforced by estimates of the percentage of em- ployees in the average establishment who would be unable to pass the medical examination for individual insurance. A representative of an insurance .company Avhich writes group life insurance asserts that "it is a well known fact that some 15 per cent of individuals applying for personal insurance cannot be accepted" and that "an average of 10 per cent of the employees of any office or plant would be rejected."*^ Few arguments urged against group life insurance by employers have come to the attention of the Commission — employers who are opposed to the plan or doubtful of its efficacy commonly content them- selves with an assertion that the plan will have little or no effect in en- listing the good-will of employees and reducing the labor turn-over or that the effect secured will not be worth the cost. A number of arguments against group life insurance have been made from the point of view of the employee. The most important of them may be summarized as follows : 1. It "ties the workman to his job." 3. It is designed and used to prevent the organization and the success of trade unions among employees. 3. The operation of- the plan will make it difficult for the poorer "risks" among working people to find and retain employment. 4. Employees insured under the plan are likely to drop other in- surance. 5. The plan is paternalistic and autocratic. ^^ Lawrence C. Wood, paper cited above, p. 8. 516 6. The future of the plan, because its use is entirely voluntary with employers, is uncertain. The first argument, the group life insurance "ties the workman to his job," is based upon the claims made for the plan by the insurance companies and its advocates among employers as described in preceding pages of this discussion. The truth of this argument, in so far as group life insurance succeeds in accomplishing its purposes, cannot be denied. The question to be considered is whether it is a good or a bad thing for employees to be "tied to their jobs" by group insurance. Representatives of employees who object to group insurance contend that it is a bad thing. They say, in effect, that it permits employers to maintain wage standards and other conditions of employment which are unfavorable to the interests of employees and which they could not maintain if em- ployees felt free to change employers at any time. Group life insur- ance, according to this view, is purchased by the employee at the cost of low wages, long hours, unsanitary working conditions, and the like. The second argument, that group life insurance is used to prevent the organization and success of trade unions, has much the same basis in the theory as the first argument. The fact that the premium rates which an employer will be called upon to pay for group life insurance will vary ultimately with the mor- tality experience of the group is the basis for the third argument. In detail the argument runs to the effect that the employer will be tempted to discharge the poorer "risks" among his employees whenever a con- venient pretext offers itself and to refuse employment to all persons who appear to be poor "risks." The discrimination against working people in the higher age groups will be especially severe. ^^ The argument that employees insured under the group plan will be tempted to drop other insurance which they may be carrying needs no explanation. The argument that group life insurance as now administered through the employer is paternalistic and autocratic is so obviously true as to require neither explanation nor proof. In no case which has come to the attention of the Commission have the terms under which group life insurance is offered to the employees by the employer been the sub- ject of genuine collective bargaining. But this statement does not dis- pose of the matter. The real question is whether paternalistic and auto- cratic control of the wage-earner's insurance by the emplover and the insurance company is desirable or undesirable. The argument that the future of group life insurance is uncertain is based largely upon the fact that the adoption of the plan in the first place and its continuance after its adoption are entirely voluntary with the employer. The following statement taken from the benefit cer- tificate issued to its employees by a company which has adopted ffroup life insurance illustrates this fact: "This action is voluntary on the part of the Company. It constitutes no contract with any employee, and confers no legal rights on either. * * *• "The Company pays all costs, and the title to all Dolicies vests It. « Compare the table on page 23 above and the discussion on page 24 following 517 absolutely in the Conlpan3^ The Company reserves the right to alter or abrogate the plan if future legislation or other circumstances render this advisable." It is also argued that the future of group life insurance is uncertain because this form of insurance "is not based upon the scientific principle of individual physical examination." The first four arguments against group life insurance which have been stated above involve questions of fact which the Commission is unable to answer from the data available to it. In advance of the ver- dict of the facts, it is fair, however, to predict that the truth of the argu- ments mentioned will eventually have to be disproved if group life insurance as now written is to receive the approval of organized labor in Illinois. The force of the argument that group life insurance is paternalistic and autocratic depends in the main upon the truth of the first four argu- ments. Judgment must therefore be reserved upon the real issues raised by this argument. The argument that the future of group insurance is uncertain is obviously true. This is not, however, because of the elimination of the medical examination in the selection of group risks for there is no reason to doubt the actuarial soundness of the group plan. The future of group life insurance, as a voluntary plan, is uncertain because this form of insurance is still an experiment with employers. It has been adopted by only a small minority of employers and these employers, with few exceptions, have turned to it in a period of rising wages and *'labor unrest." To a considerable extent the employers who have adopted the plan have done so for the sake of the advantages they think that it affords them in competing for men in a labor market where the competition for men has been unusually keen. Before the State can place much reliance upon voluntary group life insurance as a means of meeting the need of the wage-earner for insurance some evidence must be forthcoming that employers who adopt the plan will not abandon it as soon as the conditions which have prevailed in the labor market of the last few years have given way to conditions more nearly normal. Evidence must also be forthcoming that the plan will be adopted by many more employers than have yet adopted it in Illinois. In conclusion it should be pointed out that voluntary group life insurance at best will not meet the needs of all wage-earners now un- provided with life insurance for the successful operation of the plan is practically limited to groups numbering 50 or more employees and there are many employees in Illinois who are not employed in such groups. III. Group Health and Accident Insurance. (1) History. — The terms "Group Health Insurance" and "Group Accident Insurance" seem to have been applied in imitation of the term "Group Life Insurance," and to have come into use only in the past few years. The group plan, however, has been used in accident insurance for a much longer time than the name and the plan was attempted in health insurance before the name was attached to it. 518 So far as the Commission has been able to ascertain, the first group policies which appeared in the health and accident insurance field were the so-called 'Workmen's collective insurance'^ policies.^^ Workmen's collective insurance has been defined as "the accident insurance of a number of workmen collectively under one policy, as contrasted with the individual policy for each man * * * the personal accident insurance of workmen by wholesale instead of by retail."'^* It will be noted that the definition confines the term to accident insurance. One insurance company which attempted to write health insurance on a collective policy before the term "group health insurance" came into use failed to find any demand for the policy and finally withdrew it.*^ The Aetna Life Insurance Company, however, states that it "had written blanket accident and health contracts as early as 1898. Workmen's collective insurance is said to have originated, under a different name, in England in 1882.*® Information as to. the first ap- pearance of this form of insurance in the United States is not available. Workmen's collective insurance for reasons which will be stated pres- ently, has never been of much importance either in Illinois or the United States as a whole. It is discussed here because of the light its history may throw upon the possibilities of group health and accident insurance. Workmen's collective insurance has been written on two types of policies: first, and most important from the standpoint of amount written, policies covering occupational accidents only, and, second, policies covering both occupational and non-occupational accidents. Typical benefits provided under workmen's collective insurance run as follows : "(a)' In the event of death within ninety days from the date of the accident, a sum equal to, but not exceeding one year's wages limited to $1,500. "(b) For the loss of two limbs or two eyes, a sum equal to the amount payable under the policy at death. "(c) For the loss of one limb, a sum equal to one-third the amount payable under the policy at death. "(d) For the loss of one eye, a sum equal to one-third the amount payable under the policy at death. "(e) In the event of temporary total disability, .a sum equal to but not exceeding one-half the weekly wages for a period not exceeding twenty-six weeks, such sum not to exceed $750 in respect to any one person injured during the policy year. "The usual rates are for the foregoing benefits only, covering acci- dents of occupation during working hours only. "If the benefits under clauses (a), (b), and (c) be reduced one-half, the rate is 15 per cent less. * * *. "If the policy is) written to cover the whole twenty-four hours, i e., the exposure of the workman to accidents while away from work as wel( ^ " ?u^ ^^^\ ^®^® Pr.?^r^"t®^ ^^ workmen's coHective insurance are taken chiefly TT^ir^H • a (a a (-1 o O 0*j o CJ . 03 u d >< C(M C! o C«* c** X 03 TS _ m ^g 03 X3 >> 03 & X o b3 © X. C C8 «T3 a CO ^ .n"^ c -tJ X) o o +J *j ■^ « ■I-' o +J « -M <» X3 3 IM ^ Q'P. •M 2 T) -t^ £o +; S •*-* 3 a o o ti c o o a c ® o o o a> o o fj 03 -tJ ^ Z ^ ;^ P^ W ^ S s S 2^ S s ^ S O Croatian 3 1 3 1 2 1 1 2 1 1 2 1 2 1 1 Crnat i A Ti -r^7PoVi 1 Czechoslovak 57 18 9 33 • 4 8 2 6 2 1 7 1 2 1 6 15 14 6 28 2 7 2 4 1 1 6 1 2 1 1 13 9 4 22 1 "i 2 1 1 4 ♦ 2 1 1 2 5 * *5 1 5 1 2 *14 9 2 ♦11 2 *6 1 4 '"4 t t9 3 1 2 .... 10 9 4 6 1 2 4 14 13 4 20 2 7 2 2 1 — 2 G erman 1 1 8 .... 1 Greek Italian 22 12 10 2 Jewish Lithuanian . . • . 7 2 7 2 4 1 7 2 4 Lithuanian-Polish - Magyar 4 1 1 4 4 Polish 1 1 3 1 1 1 Russian Scandinavian 2 3 ♦ 2 1 * 2 1 5 1 Serbian Slovak 2 2 2 2 Slovenian 1 1 Miscellaneous 1 1 1 1 Total 161 95 65 24 58 19 7 44 43 1 71 i 22 1 32 26 6 • Some Bocietiees did not report the length of the waiting period and are there- fore omitted. t One Greek Society begins to pay the sick benefits from the 3d day, and one from the 4th day of sickness. t Three Italian Societies are paying sick benefits from the 2d day of sickness. A comparison of the number of societies with sickness benefit with the number of societies studied, by race, would indicate that the tendency to make such provision is much stronger among some races than among others. Noting details in systems maintained, 65 were found with a wating period of not to exceed a week as against 24 with one or more than a week. Some reckon benefits from the first day of disability when that exceeds the waiting period, others irom the end of the waiting period. The number of weeks for which benefits may be paid may be limited for a given illness and for all illnesses during a year. Frequently there are 529 two benefit periods, one at the full or normal sum. As shown by Table IV, the maximum number of weeks at the full rate or for any benefit as the case may be, is not to exceed six weeks in 7 cases, more than six but not to exceed thirteen in 44 cases, more than thirteen but not to exceed twenty-six in 43 cases, and more than twenty-six in the remaining one. The weekly benefits paid for a disability within these limits varies all the way from $2.50 as a minimum to $15 as the maximum. It is not in excess of $5 in 71 cases, is more than $5 but not in excess of $10 in 22 cases. Only one society pays a benefit of as much as $15 per week. Of the 95 societies, 32 pay benefits in reduced amount during a second period, the sum paid being half of the normal except in 6 cases. Three further comments must be added in connection with the sickness benefits provided by these societies, (a) Under the rules of some societies a member whose sickness experience is very unfavorable or whose disability is unduly long so that his claims to benefits are ended for the time, may be paid the death benefit to which he is entitled and his membership cancelled, (b) In connection with the limitations mentioned above, it must be remembered that these societies are not mere insurance carriers. Donations are frequently made in cases of disability and death to meet problems presented when claims to benefits have been satisfied. In other words, these societies* like the fraternal orders, are charitable as well as insurance organizations. Finally (c) it should be said that claims may not be made for sickness benefits in the case of venereal disease or disability due to careless or immoral conduct. The administration of benefits is the same as in the fraternals. Claims may be made only for disabling sickness. As a rule, but not al- ways, claims must be accompanied by a physician^s certificate, and the sick are visited weekly by a committee. Where a second claim is presented, the member may be visited by a new committee. If a disabled member is absent from the city, statements in support of his claim have to be sworn to before a notary. Data relating to the number of claims acted upon favorably and the amounts paid in 1917 were obtained from 84 societies with a com- bined membership of 11,377. The number of claims paid was 1506, the amount expended in sick benefits $32,328.77. Medical Care and Hospital Treatment. As indicated earlier, most of the independent foreign societies limit themselves to the payment of the pecuniary benefits described and to charity to the needy — in so far as their activities come within the scope of this investigation. However, 19 of the societies with a membership of 2,545, provide for medical care and five of these and four others make provision for hospital treatment as well. The medical care is given by the "society doctor." The general rule is to- collect $1 a year from each member to meet the expanse involved. In some cases the $1 per member is paid to the doctor; in other cases he is paid a salary from a fund re- plenished by assessment. One Croatian and eight Greek societies with a membership of 1,535, were found which have made provision for hospital treatment. —34 H I 530 The arrangement is either to pay all hospital bills (two Greeks socie- ties) or to pay so much per week. In the second type of arrangement, from $7 to $15 per week is allowed for six, eight, ten, twelve, twenty- six, or (in three cases) an idefinite number of weeks. The Undertaker, Saloon-keeper and Doctor as Members. §M Rather prominent as members of the foreign societies are the^ undertaker, the saloon-keeper and the doctor. Though they may take a prominent part in the affairs of the society, it is not to be concluded that they are actuated merely by business motives. While business interests have something to do with the matter, another factor is found in the place they occupy in the community. The doctor is by education a leader; the undertaker stands out prominently in the group; the saloon-keeper is likely to play an uncommonly large part in community affairs because the saloon carries with it something of the position the inn and the Gast-Haus occupy in the life of the native lands. The Mortality of Foreign Societies. An effort ha& been made to ascertain the death rate of these foreign societies, but without much success because of the absence of earlier lists of them and the impossibility of compiling such lists of earlier societies now. It has been learned that of 155 of those studied, 13 were organized before 1890; 5 between 1890 and 1895; 17 between 1895 and 1900; 27 between 1900 and 1905; 33 between 1905 and 1910; 41 between 1910 and 1915; and 19 in 1915 and the subsequent years. This, however, shows merely that a majority of those studied have been organized during the last thirteen or fourteen years. It does not assist in determining how many have ceased to be independent foreign societies because they decayed and died or because they were absorbed by the fraternal orders. Under the circumstances one must rely upon the personal knowledge of those informed. One of these is authority for the statement that of 125 societies in existence 25 years ago in a certain district only 12 remain today. Such statements as this bear out the general feeling that the average life is unfortunately short. No doubt it is much shorter than that of the ordinary fraternals for the factors causing the foreign society to disappear are more numerous. Perhaps the most important cause of the disappearance of foreign societies as such is their absorption by fraternal orders — a matter already mentioned. What were independent Polish, Croatian, Serbian, Slovak and Slovenian societies are now in large numbers affiliated as locals with national fraternal organizations. In this case the insured gain by the change from the one to the other for they have membership in a larger and more stable organization. But, unfortunately, many decay and die. An important cause of the frequent decay and death of foreign societies is that their members are for the most part the foreign born. As these become Americanized they may lose interest in the society and drop their membership. Again, the centers in which the foreign born settle undergo rapid change. A given race, closely settled and exten- sively organized, sooner or later scatters and perhaps surrenders its locality to another — the society decaying and disappearing in the pro- cess. Again, the native offspring do not generally join the order of 531 their fathers. Unless there is a movement into the community from the outside, there is not the needed succession of young lives. The average age of the members increases and the risk becomes greater. Though reserves may be carried, as with most of the fraternals, good insurance principles are not generally observed; the dues are not fixed so as to cover the entire life of the existinp" membership and prove to be more or less inadequate. Sooner or later the dues or the assessments must be increased. Other younger and perhaps better managed insti- tutions then prove more attractive to those eligible to membership. The membership declines and the period of decay sets in. This course has been avoided by some societies; it has been traversed or is to be tra- versed by a larger number. The insurance business conducted by the society is not its exclusive business; frequently it is the less important part of it. Naturally be- cause of this and the small size of the organization the management is usually not very able. Though in the typical case considerable care seems to be exercised in the management of affairs, the financial officers "bonded" and the books more or less well audited, the handicap re- mains. These appear to be the chief causes of the mortality and sources of weakness in the foreign society. Of course some of the investments prove unsound and now and then a private bank in which the funds may have been deposited has failed and resulted in substantial loss. These, however, have been the less important factors in the situation. The Foreign Societies as Insurance Organizations. Little need be said in addition to what has already been introduced incidentally with reference to these foreign societies as insurance or- ganizations. First of all, it should be said that most of them are in excellent^ position to meet the problems of malingering in connection with dis- ability benefits. Moreover, they are not limited to the terms of a definite insurance contract ; like the fraternal order and the labor union, they can and frequently do extend aid where there is no claim under the benefit rules. Their chief shortcoming is in their instability and in their voluntary character. This defect of instability is, however, of chief concern in connection with the death benefits promised. Unfortu- nately all too frequently the expected benefits are not realized because of decay and death. In such cases the insurance proves to be term insurance with premature expiration. It is relatively inexpensive and the pecuniary loss is not great because of the small sum promised. The loss, however, is frequently sustained and those who sustain it may be handicapped by age or by physical defect in obtaining insurance with other carriers. If the societies were founded on good insurance prin- ciples, were larger, and there was a greater guarantee of efficient man- agement, their value would be distinctly greater because of a more suc- cessful appeal to those eligible to membership and the less frequent cases of disappointment and loss. 532 SPECIAL REPORT XL ESTABLISHMENT FUNDS IN ILLINOIS. (By A. E. Suffern, Pli. D.) [Note by the Secretary. — Special Reports XI and XII, relating to Establishment Funds and Union Benefit Systems, have been prepared by A. E. Suffern, Professor of Economics in Beloit College. Because of space limitations the reports are pre- sented in summary form. Though an effort was made to secure complete data from employers and unions, the effort was not entirely successful.] The study of establishment funds in the State of Illinois as a part of the investigation carried on by the Health Insurance Commission has shown that they are one of the most important means of providing sick- ness and other benefits. They have become numerous and some of them have provisions which compare favorably with the comprehensive pro- visions ordinarily embodied in national compulsory health insurance schemes. Both employers and employees have used various devices for meet- ing the burden of sickness and death among the workers. Employers have naturally interested themselves in the relief of the distress of their oldest and most valuable employees. This may have been accomplished by continuing their wages for a certain length of time, a practice of a not inconsiderable number of employers at the present time. The employees by "passing the hat" have extended relief in a modest way to ^their comrades in cases of sickness, accident or death. This frequently occurs. But in a large number of cases employers and employees have come to appreciate the need of making provision in a systematic way and have resorted to the use of insurance for this purpose. More and more emphasis has been placed by the employers upon group insurance* which, however, infrequently covers temporary disability caused by sickness. Of more importance is the establishment fund by which regular and systematic provision is made. Various studies have been made of establishment funds. The features of a particular fund have frequently been a subject of inquiry and individuals interested in taking advantage of the experience of many establishments have made nation-wide surveys.^ The Federal Government and various states have considered them of sufficient im- portance to collect extensive information relating to their provisions and operation.^ In making a survey of provisions against sickness, accident and death, the Commission sought to ascertain the number and operation of establishment funds in the State of Illinois. A general questionnaire » The most Important of these has been made by W. L. Chandler. See Industrial Management, January to June, 1918. r«^«"/^^Q;?f^^^"^,i^® J?^®r*^v''**^^ ^:^^^<'^ Report of the U. 8. Commissioner of i2'o;'i.a'L'^i?i!Vgust.''r9n"''' ""'^^'^^ ""' ^' ^^^«^*^«^* of Labor, Bureau of 533 was sent out through the Illinois Manufacturer's Association and the Associated Employers. From returns thus secured, by direct communi- cations with the operators of public utilities and mines, and through per- sonal enquiry and correspondence with many establishments 134 funds were located. It is likely that other funds could be found in the State, but it is probable that the number located would not be greatly increased by their inclusion. Of the 134 found, 115 have been studied in detail, and the more important facts have been reduced to a comparable basis and made a matter of record for the Commission. It has been impossible to arrive at an accurate estimate of the number of wage-earners in Illinois with membership in establishment funds. As just indicated, not all of these funds have been studied. Again, a considerable number, like those maintained by railroad com-r panics, are interstate in their operation and in some of these cases it has been impossible to separate the membership in this State out of the total. Finally' in a few cases repeated requests for information needed have not met with the desired response. Nevertheless, it can be said that the number of Illinois wage-earners with membership in the 134 funds located is not less than 150,000 and not more than 200,000. This is be- tween 7^ and 10 per cent of the estimated number of wage-earners in the State. As would be expected, the extent to which establishment funds are found varies greatly from one industry to another and as between differ- ent parts of the State. If laborers are organized into unions, welfare plans find little place in the establishments in which they work. Sick- ness, accident and death benefits are likely to be provided by the union if provided at all. Only the larger establishments are in position to make satisfactory and systematic provision for such benefits and large scale' business is found chiefly in certain industries and in certain parts of the State. Again» a very important example has counted for much. If one prominent establishment sets an example, the other establishments in the industry or in the locality are likely to follow it. For Guch reasons as these most of the funds found are in the iron and steel plants, large establishments engaged in the manufacture of agricultural im- plements, the meat-packing plants and the large stores of Chicago, or are operated by the railroad, telephone and other utility companies. They find practically no place in coal mining and the building trades where the men are well organized into unions, and in the many industries and businesses conducted on a small scale. The organization of establishment funds has gained impetus within the last few years. Yet the scheme is by no means a new one. No fewer than twenty of the 115 studied have been in operation for twenty years or more> and one of these has been in operation since 1874. While a number of the funds have been in operation for a good many years, •it is important to note that most of those located have been started within the last eight or ten years, and that the list is being added to yearly. While new funds have been organized, a considerable number have been discontinued for one or more of several reasons. In some instances the opposition of employees who had established a union has caused the 534 lapsing of a fund. A few cases have been found where unions have been formed and made provision for disability and death benefits and the men have objected to two systems of insurance. Or it may be that the employer, confronted by union demands, has changed his labor policy and given up his welfare plans. Some funds were discontinued when Workmen's Compensation was adopted and the old provision for cases of industrial accident was no longer needed. Finally, to mention only the more important causes, some have been discontinued because the benefits expected have not been realized. As already stated, detailed information has been secured from 115 of the 134 establishment funds known to exist in the State. The details show a bewildering variety in membership rules, in benefits provided, in method of support and in administration. In some cases member- ship is compulsory, in others voluntary. Where voluntary, the rules relating to admission may be restrictive or fairly free from limitations. Collectively they compensate for wages lost by reason of disabling sick- ness or accident, provide funeral, benefits and life insurance* and make organized provision for medical and surgical treatment, hospital care, nursing, medical and surgical supplies, and dental care. Thus every feature of a fuU-fiedged health insurance program is found. But taken separately in no case are all of the benefits thus enumerated provided. In most cases only cash benefits are paid, frequently in small sums for a comparatively short time; in only a few cases are extensive medical* nursing and dental benefits found. In some cases the entire cost is borne by the employees; in some cases it is divided in some proportion or other between them and the firm ; while in still other cases it is borne entirely by the employers. The administration may be in the hands of the employees, in the hands of the employer, or be shared in or con- trolled by both. The details relating to membership, benefits, method of support, and experience are presented at some length in the later sections of this report. The widely varying arrangements found among the funds studied are easily understood, for these funds are the result of initiative taken by employer, employees, or employer and employees to meet differeing situations by rule rather than by "passing the hat" or by continuing wages to a part of those who fall ill. In the absence of compulsion and standardizing agency, some funds have been like Topsy — just "growed;" others have been worked out with some care; still others are the product of past experience; many have been copied with or without serious revision; and how much it would cost has usually been a consideration of importance. While the establishment funds studied present the greatest varia- tions in detail, they are after all of three main types, which may be called employees', joint, and employers' funds. Those in which the support is entirely provided by the employees may be designated as Employees Establishment Funds. Generally the administration of these is completely in the hands of the employees. Where these two characteristics are present, but in conjunction with which the dues are collected by the firm from the pay-roll, the basis has been laid for what may be properly termed Joint Establishment ^ o r* Funds. The firm in functioning thus as a collector of dues has defi- nitely taken on one of the chief items of expense in the administration of the fund, and this service may rightly be counted as a contribution to the fund. From this point it is only a matter of elaborating the assistance which the firm may give in administering claims, sharing in the joint official responsibilities, and in making definite money contri- butions to the fund each year. When these features are present, we have what is ordinarily thought of as Joint Establishment Funds in the fullest sense of the term. Of those studied 22 may be classed as Em- ployees Funds and 82 as Joint Funds. In the third type, here called the Employer's Fund, and totalling 11, the employer makes the entire contribution to the fund and has charge of the administration of it. Under such circumstances the burden of sickness, as in the case of insurance against accidents under the workmen's compensation laws, becomes a charge upon the business. As illustrative of the nature of establishment funds one of each type has been selected and the main provisions are set forth. An em- ployees' fund with a membership of 38, provides a sickness benefit only. The fund is supported by contributions from members of 50 cents per month. There is a waiting period of 14 days before members are en- titled to benefits, but if sickness continues beyond this fixed period, benefits are "naid from the first day of sickness. The fund provides $10 per week for 13 weeks for any one disability and a maximum of 39 weeks in any one year. No medical, hospital, or nursing care is pro- vided, nor is any funeral or death benefit paid. Over against this voluntary fund administered entirely by the employees may be placed an employers' fund, membership in which is compulsory. The total number of employees covered is 6,975. The entire support is borne by the employer and the fund is managed as a regular part of the business. The waiting period is 3 days and the benefits begin on the fourth day of disability. The fund provides a benefit of two-thirds wages for a period of 10 weeks. In addition to the sickness benefit a death benefit, that increases from $500 to $1,000 with length of service, is paid. Medical treatment is furnished at the plant and is also frequently extended to the home of the members. Hospital care is frequently furnished when there is urgent need. Two nurses are provided at the plant, but no definite arrangements are made for visiting nurses. Dental care is confined to examination and advice. The firm maintains a pension fund for the employees and for widows of former empoyees in addition to its care of sickness. Between these two types a joint fund has been chosen in which the management is shared by employer and employee. The one chosen for study had in 1917 a membership of 26,759 in 23 plants. It provides a waiting period of 7 days. Benefits, beginning on the eighth day, are paid for 52 weeks. The amount of the benefit is one-half wages. Medical care is confined to the plant. One nurse is employed at each of the plants and in one locality arrangements are made with a Visiting Nurse Association to visit employees at their homes when needed. A death benefit of 1 years' wages with a maximum of $2,000 in case of sickness, and 2 years' wages in case of accident, is paid. The fund pays a maternity benefit of 3 months' earnings to those who have been mem- 536 bers for a period of 9 months. To the support of these benefits the firm contributes a definite lump sum and assists in the management of the fund. In addition to the above benefits, tuberculosis cases promising beneficial results receive sanatorium treatment in excess of the 52 weeks provided by the fund. The support of the treatment is divided equally between the firm and the fund — the fund charging its share to "ex- pense" rather than to benefits. I. Membership, Eleven of the 115 funds studied are maintained by the employers. In these cases all of the employees who can meet the qualifications set up have membership in the funds. The same is true of the 18 joint funds in which membership is compulsory. In several other cases the pressure brought to bear upon workmen to seek membership is so great that little option is left. Combining these cases, a considerable number of instances are found in which all, or all but a comparatively few of the employees are insured. Over against these stand the larger number of funds in which membership is purely voluntary. Whether the mem- bership in these funds is relatively large or small depends upon num- erous factors such as the interest displayed in securing new members, the terms on which they may secure benefits, the nature of the benefits, and other opportunities available for insurance. The investigation shows precentages of membership varyinp* all the way from close to 100 down to 24 per cent. Taking 88 funds of the various types together, it was found that the membership was 65 per cent of the total number of employees. Great importance attaches to the qualifications for or restrictions upon membership. The more important of these are summarized in Table I. TABLE I— MEMBERSHIP IN ESTABLISHMENT FUNDS. • o 3 a 3 :25 Limitations on admission. Membership lost because of— Dependents admitted to member- ship. Type of fund. o < a cA dX3 1 a 03 « . © n ll Period of em- ployment. 1 § ..-4 03 •a Branch of em- ployment. Salaried employees. 02 s a •^ 3 ft i 03 03 ft ■•-> a 3 a§ a" t— 1 a i Employees 22 11 82 4 1 21 11 2 42 2 9 7 4 26 12 5 31 16 33 1 3 6 '"2 1 5 2 3 20 47 6 8 58 14 10 77 10 8 31 1 3 1 2 EmDloyers Joint...........:::: Total 115 26 5,5 11 37 48 49 4 8 6 5 67 72 101 49 4 3 This table, based upon an analysis of the constitutions and by-laws of establishment funds, shows that a great variety of conditions are set up for membership. Few cases are found in which a number of limita- tions are not present, and in some instances they are decidedly restric- tive in their effects. 537 The most frequent qualifications ioT membership are with reference to age and personal habits. Most of the age limitations are designed to debar the older men from securing membership and drawing upon the funds greatly in excess of the contributions they make to them. For the same reason the rules in approximately half of the cases provide specifically for the exclusion of those of immoral habits. The passing of a medical examination is another protective device found in almost a third of the funds. Incidentally it excludes those most in need of the benefits provided. Following lodge practice, initiation fees are charged in many cases (49). In a few cases certain races are barred from mem- bership. In a very few instances restrictions prevent the admission of salaried workers (6 cases) or those whose earnings fall below a certain amount (5). In the one case, it may be claimed that those with large earnings are individually able to take care of sickness, while in the other the benefit may exceed the wage of the employee and thus encour- age malingering. Restrictions based upon the length of service and on physical con- dition as shown by a medical examination have become increasingly important. Even in the voluntary associations a period of probation may be set up by the older employees in the association in order to discover what sort of risk a new employee promises to be, before he is admitted to membership. For the employer a period of probation serves two purposes. By this means he is freed from risk of sickness benefits arising in connection with the casual and shifting body of his employees. And, in the second place, the promise of benefits after a period of faith- ful service, may result in longer tenure, thereby reducing his labor turn- over and increasing the efficiency of his force. In the employer's funds studied the period of probation ranged from 3 months to 2 years, while in the employees' and joint funds it ranged from 1 week to 3 months, the most common period being one month. Of the 104 employees' and joint funds 43 fixed the period of probation at one month. The importance of medical examination as a form of restriction is seen in its use by 7 of the 22 employees' funds, by 4 of the 11 em- ployers' funds and by 26 of the 82 joint funds. Medical examination may be used not only as a means of eliminating chronics as a drain on the fund but it may also be used to prevent a drain from the appearance of contagious diseases. Its importance as a means of restricting mem- bership can not be judged solely by the number of funds that have this specific provision. A numebr of establishment funds were found in connection with firms that required a physical examination as a condition of employ- ment. Where funds are so situated, there has already been a selection of workmen on the basis of health and physical fitness. Instead of a medical examination as a condition of membership, the annlicant may be required to file a health certificate from the employment department. If the fund provides an additional medical examination, it means that a further selection is made and the sickness experience of such funds can not be taken as a basis for conclusions that will apply to workmen generally. 538 While rules restricting membership in some form appear in almost all of the funds studied, there has been no means of estimating the extent to which they have actually limited admission to them. Along with the restrictive rules there may be also pressure, especi- ally in employee and voluntary joint funds, to include as large a number of members as possible. Funds in small plants providing few and meagre benefits may be successfully operated with voluntary member- ship. But as more elaborate and adequate benefits are provided, the expense of operation becomes increasingly heavy. The desire to reduce the burden of this expense and thereby protect the amounts available for benefits is a strong force in extending the membership to include as large a number as possible. After an employee has been admitted to a fund, he may lose his membership as the result of a variety of stipulated penalties. Failure to pay dues is followed by loss of membership in 67 of the 104 employee and Joint funds studied. As soon as membership becomes compulsory or when the dues are deducted from the pay roll, there is no occasion for the use of this penalty. Immoral conduct is another cause which may result in loss of mem- bership. What constitutes immoral conduct is different in nearly every association that has adopted this provision. However, it is of enough significance to appear in the constitutions of 49 of the 115 funds. Fraud, giving false information and disobedience of the rules of the association may be cited as causes which may call forth this penalty. A *^ay off^' and discharge are usually followed by loss of member- ship. In 72 of the funds studied, a "lay off," and in 101 discharge would call forth this penalty. But in some instances the penalty is tempered by allowing the employee to retain his rights to benefit for a period of time by keeping up the payment of his dues.^ Provisions for the retention of these rights by discharged workmen are not likely to find favor among the members of these funds, for employees engaged in another occupation may introduce another degree of risk to sickness. For this reason and because protection against sickness is regarded as the affair of a particular establishment, such provisions, are not likely to become prevalent. When an employee has lost his membership for one reason or an- other, provision for reinstatement upon the payment of a fee is found in 18 funds. These fees range from 25 cents to $10 — the majority being about one dollar. Sickness henefits. — The sickness benefits paid are in some instances fixed in amount while in others they vary with amount of salary, length of service, number of weeks the benefits are paid, or in accordance with some other standard. Fixed benefits are accompanied by fixed dues, and graded benefits by graded dues. These facts are shown in Tablell. In 63 of the funds fixed benefits are paid and these range from $4.06 to $14 per week. The majority of them paid $7 to $10 per week. In 57 of th e funds graded benefits were paid which ranged from $1.50 •The most striking case found permitted the retention of membership for one year upon the payment of dues. 539 to $19.98 per week. In a majority of the cases the minimum benefits are close to $3.50 per week and the maximum about $11.50. TABLE II— RATES OF WEEKLY ACCIDENT AND SICKNESS BENEFITS CLASSIFIED ACCORDING TO TYPES OF FUNDS. vi ^ Fixed rates .* Graded rates.* c3 t3 Si O X T3 to Accident. Sickness. Accident. Sickness. -fj .c -^ Type of fund. © % £s 8 R R Mini- Maxi- Mini- Maxi- ^ en S -^ R R ^ mum. mum. mum. mum. fl •c -o 5£ 3 o 8 <^ ni CO la o — , © C ^" o s o 8 o c S O 8 2 c Of-" 8o^ 1^ 2s 8o> H ^ £h t^ «# ^ ^ fe «« ^ 4^ ^ s^ ^ ^ Employees ?? 18 4 5 4 7 .5 5 8 1 1 1 1 1 3 2 2 Emcloverst 11 1 fio 1 1 Joint 82 115 t44 16 9 23 16 2 14 16 13 16 14 16 14 16 Total 63 **51 22 13 7 29 21 10 15 17 14 17 15 19 J6 18 * These "Fixed Rates" are variable in amount only as between funds while "Graded Rates" are variable in amount within the same fund as well as between funds. The data under these headings are merely a tabulation of details where given. The variation in totals from the general totals is due to the fact that not all funds provide accident benefits and that detailed information on graded rates was not given in every case. t All of the Employers funds except one were graded in rate benefits according to amount of salary, length of service, and number of weeks benefits were paid. $ Benefits consisted of medical care among three hospital funds and are not included in the figures for the rates of benefits. One joint fund did not report benefits. * Six joint funds provided percentages of wages for variable periods. One joint fund did not report benefits. The statement of the benefits paid raises the question of their adequacy. The need of the wage earner and his dependents is even greater in time of sickness than in health. But in determining the amount he shall receive and how soon he shall get it, the possibility of malingering must be considered. Testimony has been given by one who has had large experience that sickness beneiits may be as high as 90 per cent of the wages and still not encourage malingering.* This state- ment is corroborated by the experience of employers' funds which pay full wages for a certain length of time. Of course such a provision is supplemented by an effective system of administration which enables a firm to check up absence and sickness of its employees. The establishment of a waiting period before a sick member is entitled to benefits is an additional check on malingering. The wait- ing period found in connection with the funds studied varies from half a day to 14 days, but the most common period is 7 days. Three funds had no waiting period, one had one-half day, one had 1 day, two had 3 days, three had 6 days, twentyseven had 7 days, and three had 14 days.^ There is also a difference in the practice as to whether the bene- fits date from the first day of sickness or from the end of the waiting period. There were 38 funds in which benefits are paid from the first * Chandler, Industrial Management, April, 1918, p. 293. ^ See Table III. 540 day of sickness, but the most common practice is to pro\ide benefits from the end of a 7 day waiting period. Forty of the 115 funds showed disability from sickness and compensation during the year. Of this number 13 pay benefits from the first day of sickness, providing the sickness lasts for the stipulated waiting period.^ Eleven of these 13 funds are joint funds and 2 employees' funds. Certainly an employee is less apt to pretend to be sick if he does not receive pa3^ment for the waiting period. If he does receive payment he is likely to remain away from work a day or two longer to fill out the time necessary .to receive benefits. The only way such contingency could be dispensed with would be to provide a very efficient system of medical examination which would compel the employee to return to work as soon as he is able. Much the same problem of administration is present when the waiting period is two or three days, and even fixing the payment of benefits from the end of the waiting period does not entirely dispense with this problem. On the other hand, the requirements in connection with the waiting peripd may be so stringent as to deprive the member of the protection he needs. A 14 day or longer waiting period will eliminate a large per- centage of the cases of sickness. This objection to a long waiting period is offset by some associations by the payment of the regular benefit from the beginning of the period or the pa}Tnent of from $1 to $3.50 for the first week of the waiting period and the regular benefit for the second week and thereafter. Another problem is the number of weeks a member may receive benefits during any disability, and in any one year. The rules governing these questions have a very important bearing upon the extent of the protection the member receives and upon the solvency of the fund. Tak- ing all of the funds into consideration, the number of weeks that benefits are paid for any one disability varies from 2 to 104, but the length of time most commonly found is 13 weeks.'^ When the benefits are paid for a period of only 13 weeks cases of prolonged illness can not be properly cared for. Nor is a member better off w^hen the rules provide benefits for a stated number of weeks in one year, unless there is a very liberal provision to take care of sicknesses of long duration. Among 12 funds an attempt has been made to care for prolonged disability by providing benefits for 52 weeks,^ and in some of these provision is made for an extension of benefits at the discretion of a board of directors or officials. Of those funds that make provision for a rather limited period for a given disability or for disability in any one year, 43 claim to make further extensions of benefits in special cases. Unfortunately, there is no record of the adequacy of such extensions but apparently when pro- vision is made the benefits paid are usually at a greatly reduced rate. The benefits paid by employers' funds are often governed by the length of employment with the. firm and the amount of wages or salary received. The simplest arrangement provides for full or half salary for a fixed per iod. In others the greater the length of service up to a • See Table III. p. 542. » The actual distribution was as follows : one, 4 weeks ; three, 6 ; one, 7 ; five, ^"' V^ 12: thirteen, 13 ; one, 14 ; two, 15; one. 17; six, 26 and five, 52 weeks. » These firms provide benefits for 104 weeks. 541 certain number of years, the longer the employee may draw benefits. The most liberal provision for aid in case of prolonged sickness found among the employer's funds studied is a guarantee of half salary until the employee is able to resume work. There is a great variety of rules governing the payment of benefits in case of chronic diseases. Where there is no medical examination as a condition for membership, there are usually lax arrangements for the payment of benefits. This situation is likely to be found among em- ployees' funds. Out of 32 employees' associations 17 pay benefits in cases of chronic diseases. However, the burden upon the fund from this pro- vision is generally greatly lessened by the limitation upon benefits for any one disability, or in any one year. The same statement is true for the 30 joint associations that provide for chronic cases, except among those which allow for an extension of benefits. Only 3 of the employers' funds pay for chronic diseases but 4 out of 11 have provision for ex- tension of benefits. Six of the 22 employees' associations and 33 of the 82 joint associations allow extension of benefits. In order to show the operation of these funds it will be well to con- sider briefiy the provisions for sickness among the 40 funds that furnished information concerning the number of employees, the number of members, the members receiving benefits, the extent of disability, the compensation paid and the cost per member. ^ For the year 1917 (the last year for which complete data could be obtained) there were be- tween 314,000 and 320,000 employees in the establishrdents where these 40 funds were located.^ The membership in these funds was 228',880. During the year there were 55, 467 cases of disability compensated, or 1 for each 4.1 members. The number of days of disability compensated was 1,265,846, or 22.8 days per case. Very few firms could furnish information concerning the total days of disability of their employees as no records were kept for the time lost that did not result in the granting of benefits. Only those firms which had no waiting period, and, there- fore, compensated for all time lost could state total disability due to sickness, and as there were only 3 such funds, conclusions based on their experience would be of little value. The benefits paid in the above cases amounted to $1,653,619 or $29.91 per case, which is equivalent to $1.31 per day of disability. If the costs of these benefits are spread over the entire membership, it would amount to $7.22 per member. However, these averages must be used with great caution and con- sidered in the light of the various influences that affect them. The amount of benefits paid, and therefore the averages, depend, as already indicated, upon the duration of sickness, the rate of benefits, the waiting period, the grading of benefits, and other similar influences. While these figures are unsatisfactory for showing sickness experience, they are of interest in the light they throw on the amount and adequacy of the care of sickness through establishment funds. Provision for maternity benefit is found in nine employees' funds, in 5 joint funds and in 1 employers' fund. * See Table III. Some of these establishments were doing an interestate busi- ness, and, therefore, the figures include employees outside of the State. The number of employees was not reported for five establishments, although the membership in the funds was given. In the 35 remaining establishments there were 314,032 employees. 542 TABLE III- -SHOWING DETAILS FOR 40 FUNDS CLASSIFIED BY LENGTH OF WAITING PERIOD. en >, eS •O c •^^ Num- •s ber of .^4 fund. 0) P. M 5 ■w •a ^ Benefit begins. "S CO O B a a XI a XI S X3 . Days of disability. (3 O en a o 03 ID > Si ^a > 9 <1 Benefits paid. 03 O o K 03 o (.1 « ft (1 P* o . ^a ^a 1 2 3 4 * 5 1 6 3 7 3 8 6 9 6 10 6 11 7 12 7 13 7 14 7 15 7 16 7 17 7 18 7 19 7 20 7 21 7 22 7 23 7 24 7 25 7 26 7 27 7 28 7 29 7 30 7 31 7 32 7 33 7 34 7 35 7 36 7 37. 7 38 14 39 14 40 14 1st day.. ..do ..do — . ..do ..do 4th day. ..do 7th day. ..do ..do 8th day. ..do ..do ..do ..do ..do ..do.... 1st day.. 8th day. ..do 1st day.. 8th day. ..do. . .. 1st day.. ..do 8th day. ..do ..do ..do 1st day.. ..do 8th day. ..do 1st day.. 8th day. 1st day.. ..do 15th day 1st day.. ..do 52 325 190 49 601 12.2 3.16 10 tt 375 60 3,108 51.8 8.28 6 130 125 42 462 11.0 3.69 7 65 40 57 172 3.0 4.30 14 709 293 138 2,243 17.3 17.62 13 4,935 1,014 445 1,290 2.8 1.27 10 16,033 5,342 1,943 25,444 15.9 4.78 52 73,446 53,385 12, 420 432,791 47.6 8.10 52 71, 162 J54,130 133,615 J399,050 19.3 7.37 53 47,349 39,690 4,608 124,687 24.8 4.19 **13 293 293 5 24 3.4 .08 ttl3 319 319 5 440 95.0 1.37 *13 106 106 17 438 32.4 4.07 ♦13 29,095 29,095 1,142 31,884 34.4 1.09 ♦13 15,043 15,013 2,960 98,312 40.0 5.53 26 ■t 43 10 296 29.6 6.90 26 ■t 392 26 641 30.6 1.63 6 1,250 1,250 253 3,501 13.8 2.80 13 5^ 56 15 173 17.5 3.09 12 175 70 15 554 36.9 7.91 13 715 290 31 993 32.0 3.42 13 105 40 2 26 13.0 .65 13 715 274 32 912 28.5 3.32 10 300 270 29 460 20.6 1.70 17 140 77 36 569 15.8 7.32 13 900 460 71 1,780 25.0 3.87 15 466 372 51 840 19.8 3.08 4 60 52 3 42 14.0 .80 10 704 149 17 309 30.0 2.07 26 4,850 2,743 469 10,780 23.0 3.93 10 950 930 325 2,975 9.0 3.2 13 250 250 8 64 8.0 .25 26 750 405 23 659 24.3 1.62 12 145 145 19 221 11.6 1.52 52 37,294 28,759 3,498 99,144 35.3 3.7 6 3,500 3,500 3,820 16,920 6.0 4.83 15 1,152 800 134 938 7.0 1.56 13 550 150 39 560 14.3 3.75 26 t" 133 21 775 36.9 5.22 26 tt 130 21 774 36.8 5.95 314,032 228,880 55,487 1,265,846 22.8 5.53 $ 510. 95 3, 041. 00 577.00 172.00 1,290.94 5,558.31 40,331.35 453,011.25 1583,141.64 151,732.00 91.18 1,065.77 381.00 73, 156. 00 153,221.00 491. 82 641.00 3, 057. 65 173. 50 551.50 1, 107. 15 15.70 912.00 460.00 426. 75 2,572.28 840.00 35.00 582. 08 7, 717. 10 4,649.76 64.10 593. 10 221.00 149,369.60 8,602.00 1,343.31 356.40 1,085.05 1,175.00 $1,625,536.19 S 10. 43 34.01 17.07 3.01 10.08 12.49 30.72 36.55 24.44 32.92 18.23 313. 13 34.17 64.03 51.80 49.18 24.65 12.08 11.56 36.76 35.71 7.85 28.50 20.60 11.85 34.82 16.47 11.66 34.24 18.45 11.23 8.00 25.78 11.63 42.73 3.06 10.02 9.14 51.67 56.00 $29.91 $ 2.68 5.44 4. 4. 4. 5. .61 ,30 .40 .48 :7.54 8.48 10.77 5.11 .31 3.34 5.48 2.51 10.19 11.43 ,63 ,44 09 87 ,81 ,39 ,38 ,70 ,54 59 ,08 ,67 ,90 ,81 ,99 ,25 1.46 1.52 5.58 2.45 2.23 2.37 8.15 9.03 1. 2. 3. 7. 3. 3! 1. 5. 5. 3. 3*. 2. 4. $7.22 ♦ (1) t (2) t (3) *♦ (4) tt (5) Pays full benefit for 14 weeks and 15 benefits until recovery. Firm paid also $26,714.45 to employees 5 years or more in service. Firm pays difference between salary and sickness benefit rates for 10 weeks. Data for 1916. Figures for 1917 not complete. Varies from 13 to 52 weeks according- to length of service. Numbers of employees not reported. The rules governing the payment of benefits when the disability is the result of immoral conduct are more lax in the employees' funds than in either of the other two. Eight employees' funds pay for disability in case of venereal disease, 5 for intemperance and 9 place no limitation upon immoral conduct. Among the joint funds the corresponding figures are 5, 3 and 3, and among employers' funds 1 pays for disability caused by intemperance. Another important aspect of the pa}Tnent of benefits is the prompt- ness with which the settlement of claims is made. From the returns 543 received it appears that immediate payment of claims is more common in the employers' than in the other two types of funds, while deferred payments are more common among employees' funds. The figures for those reporting on this point show that 7 of the employers' funds (all reporting), 4-i of the 73 joint funds reporting, and 3 of the 13 em- ployees' funds make immediate payments of claims, while 10 employees' and 39 joint funds make deferred payments. After the benefits have been allowed, the majority of the funds provide for weekly payments. Those that do not, pay monthly, or in a lump sum after the employee has recovered. Death benefits. — In addition to the foregoing benefits it has been found that in connection with a considerable number of firms a death benefit in some form has been provided, such as funeral benefits, death benefits, group insurance, etc. Benefits of this characcer nave, in some instances, been provided by the establishment fund, in others, by the firm itself. The funeral benefit is the simpliest form of death benefit and is provided by 16 of the 22 employees' associations, 60 of 82 joint funds, and 4 of the 11 employers funds. It seems to have originated in connection with employees' associations and probably antedated the payment of sickness benefits. The amounts paid are usually small, and do not ordinarily exceed $50 to $100. Two funds were found which pay $200 and $300 respectively. It is of interest to note that this form of benefit persists along side of rather liberal insurance schemes that are provided by some joint associations and employers' funds. In only 3 instances among the establishment funds studied are funeral benefits extended to the employees' wife or other dependent. Three joint associations have such a provision, but the benefits paid are small, ranging from $30 to $100 in case of the death of the wife and from $20 to $60 in case of death of other dependents. Some of the joint associations have provided out of the funds built up by the regular weekly contributions a death as well as a sickness benefit. In some instances compensation for accidents and deaths from accident is made out of this same fund. The payments may be either a fixed sum, as $1,000, or graded, with amounts ranging in case of death from sickness, from $200 to $2,000. Mne funds were found that make some provision. In some instances the burden of death benefit is borne by the em- ployer. This is done by providing group insurance through an insurance company. This method of providing against the contingency of death is of comparatively recent development among those firms with establish- ment funds. Thirteen were found that had taken out group insurance for their employees. From the character of the benefits, it would appear that -firms have taken out group insurance as a means of encouraging loyalty, length of service and efficiency on the part of their employees. As illustrative of the rules commonly found a $100 benefit may after one years' service increase $100 each year up to $1,500. The employees in 10 of the firms providing group insurance were free to leave their em- ployment and still retain the protection under an individual policy pro- vided they individually assumed the rate of premium which was re- quired at the attained age of the applicant. This privilege was granted to the employee without medical examination. In the establishments 544 furnishing group insurance either employees' or joint associations pay sickness benefits in addition to the death benefits from the insurance. It was also fund that 7 companies have provided, as a company fund, a death benefit for their employees, which ranges from $100 to $2,000. There were 6 employers' funds, paying sickness benefits, that provided a death benefit in case of death from sickness. The amount of the benefit varies with length of service. A typical arrangement is the payment of six months salary, not to exceed $2,000, when an employee has been with the firm for 5 years or more, and one year's salary, not to exceed $2,000, when employee had served 10 years or more. Other benefits found among establishments where the various types of sickness and death benefit funds are in existence are pensions, loans, profit-sharing, saving schemes, and general welfare work.^*^ Contributions. — It is in connection with contributions to the fund that we have to look for the basic differences among the various types of organization. Whether or not the firm contributes is the test that separates the joint and employees' funds. Although there is one case on record where the management of funds contributed entirely by the employees is in the hands of the employers,^^ we found no such instance in the State of Illinois. In only 10 cases where the contributions are joint is the management entirely in the hands of the employers. In 59 cases among joint funds the only contribution of the firm is the expense attached to collecting dues from the pay-roll and in 46 of these the management is conducted by the employees. In a number of cases the chief support given to the fun^ by the firm has been a contribution of a definite sum when the scheme was put into effect. This has usually been made to enable the fund to pay benefits sooner. But when the firm has promised to contribute a fixed sum annually, or an amount equal to a certain percentage of that provided by the employees, the fund has become typically a joint affair. This latter development is usually ac- companied by joint administration. There are 5 cases where the firm contributes a fixed sum annually, or a definite amount per employee and 17 cases of a percentage of the amount paid by the employees. The per- centages range from 10 per cent to 100 per cent but the most common one is 25 per cent. Of course in the 11 employers funds the whole ex- pense is borne by the firm. In 17 cases among the joint funds the firm guarantees that the benefits shall be paid. The actual distribution of the costs between employers and members of the funds is of interest. Information which will permit of a com- parison of the relative amounts contributed by the employer and em- ployee was received from 50 of the joint funds. These 50 establishments employed 338,473 workmen, and 244,528, or 72.2 per cent of these were members of the funds. During the year 1917 the sum of $4,357,529, or $17.82 per member was paid into the funds. Of this amount the em- ployers contributed $498,322, or 11.4 per cent, while the employees con- tributed $3,857,207, or 88.6 per cent. In other words the firms con- tributed $2.03 and the members $15.79 of the $17.82— the total contri- bution ]^er member. However, in 36 of these 50 funds the firms made were '"The respective number of cases in whicli such provisions were present 16 pensions, 5 loans, 2 profit-sharing, 3 saving schemes, and 2 welfare work. ^^ Monthly Review of U. S. Dept. of Labor, Bureau of Labor Statistics, August, 1917, p. 20. 545 no money contribution. In many of these cases tlie only contribution made was the "checking off" of dues from the wages of the members, thus reducing the cost of collection. In the remaining 14 funds the firms made a money contribution and the relative amounts contributed have been separately studied.^- There were 242,585 emplo^'ees and 167,431 members in these 14 establishments, or in other words 71.6 per cent of workmen and 68.4 per cent of the members of the 50 funds under con- sideration. During 1917 there was paid into these 14 funds — $3,895,- 917, or a total of $23.26 per member. The firms contributed $498,322, or 12.8 per cent while the members contributed $3,397,595, or 87.2 per cent. In other words of the total amount contributed per membed — $23.26— the firm paid $2.97 and the members $20.29. To the contri- butions of tlje firm should be added the cost of collection of dues and the contributions toward the administration of the funds concerning which no data were received. In only 9 cases does the firm require a release clause. as a condition of making its contribution. This undoubtedly is a persistence of the arrangement so prevalent before workmen's compensation came into effeot. Of course such a requirement is not applicable where the com- pensation is for sickness and non-industrial accidents which do not give the employee a right of action for damages. Even where there may be an attempt to handle the compensation of industrial accidents by such an arrangement it will not relieve the firm from damages unless the em- ployee definitely accepts the benefits as a settlement. The sources of income of establishment funds are the regular con- tributions from members and payment made by the firms — the character and amounts of which depend upon the type of fund. The contributions of the employees consist of dues, special assessments, and such supple- mentary sums as fines for breaking rules, fees for initiation and rein- statement, interest on loans and returns from special occasions held for the benefit of the funds. The dues are in some instances a fixed sum per week, the amounts ranging from 2% to 19 cents per week ; in other instances the dues are graded, the amounts ranging from 87% cents to $1.25 per week. There are 40 associations that charge graded rates. A number of considerations affect the variation of these rates. The rates may vary in accordance with wages earned, or with the degree of hazard of one group of employees as compared with that of another. For example, in the railroad business those employees engaged in oper- ating trains pay $1.25 per week in the highest class while those in the same wage class in other less hazardous lines of work pay 93% cents. Then, the dues may vary on account of the kinds of benefits furnished or the length of time benefits are paid. The collection of dues in em- ployees' funds is in every instance by the organization itself, while among joint funds the dues are collected from pay-roll except in five instances. Special assessments are an important source of income. In fact, in some of the funds it is the only form of income. In 48 cases special assessments in addition to dues are found. In 39 cases the assessment is used to provide sickness benefits, and in 22 to provide death benefits. "These 14 funds include 3 railroads, but the relative proportion of firms con- tributions is slightly less for these than the average of all the 14 funds. —35 HI 546 Thirteen associations use assessments for both sickness and death bene- fits. Thirty of the funds limit the amount of the assessments and these limits vary from 10 cents to $4. Some associations use assessments as a means of keeping a balance on hand that is regarded as adequate to meet the demands upon it. Another form of sickness benefit found in establishments is the hospital association, which provides treatment at a hospital instead of money benefits. Three such associations were located. They operate along the same general lines as the employers' and joint funds. The payment of a stipulated premium per month entitles a member to medi- cal and surgical treatment for sickness and accident for a definite period of time. Extension of such treatment beyond the time specified can be had only at the expense of the employee unless special exception has been made by the board of trustees. Employees were represented on this board in two of the three cases found. Physical care. — Within the last few years an increasing appreciation of the importance of proper medical care of employees has been develop- ing. In fact, the extent to which measures have already been taken in this direction is sufficient justification for classifying such efforts as a part of the benefits which accompany pecuniary aid. Naturally the first use of medical care accompanied the effort to relieve suffering in acci- dent cases. But the practical results obtained in the reduction of ex- pense to the firm and in the rapid recovery of the employee demon- strated the importance of extending such service to the care and pre- vention of sickness. Moreover, there is definite testimony to the bene- ficial effects that it has had on the general efficiency of the employee and to the encouragement it has given to more cordial relations between the employer and his working force.^^ It is very encouraging to find that medical care is taking on a larger asf)ect than the mere relief of distress. In fact, the same principles which are applied in conection with the relief and prevention of accidents are quite as effective in dealing with the burden of sickness. Those who are in the vanguard in this movement are convinced that the im- })ortance of hastening recovery of the disabled is no greater (if as great) than tlie prevention of recurrence. The cooperation of the physician and the safety engineer can do more than to locate the blame of the em- ployee or employer for accident or sickness. Not onlv can they bring a better regime of safety and sanitation in the industrial plant, but thev can reach out mto the home of the employee in a way that lessens their problems at the. plant. When a firm is able' to announce definitely tliat it has reduced through such measures the amount of time lost on account of sickness by 40 per cent the question has been taken out of the realm of theory and reduced to the level of practice.^* The use of medical examination is taking on a larger function than the mere discovery of disease and unfitness for employment. Those who appreciate Its possibilities are encouraging the employee to report at once to the doctor when he is feeling sick. This is proving as important an the require ment of immodin^o attention to scratches and slight acci- pp. 439^*4^9. ^^''^' '''"^*"' ''""'■'"'' ''^ ^"^°^ Statistics, Monthly Review, March, 1917, -}TontMy Review of U. 8. Bureau of Labor Statisti<.s, March, 1917, p. 446. 547 dents which may cause infection. Furthermore, frequent reexamination not only supplements efforts to attain the maximum of efficiency of each employee, but it also is a great aid in the prevention of contagious, chronic diseases, and permanent disability. Those who are making the wisest use of medical examination testify not only to the small per- centage of rejection of applicants for emplo}Tnent,^^ but appreciate the use to which it can be put in properly placing an employee at the time of his induction into the business and in re-placing him in his progress from one department to another. Information concerning the amount and character of medical treat- ment furnished employees was received from 115 firms where establish- ment funds were located. In only 43 instances was claim made that medical treatment was provided. This treatment is, in some instances, furnished by the fund and in others by the firm. In some cases the -expenses insurred are shared between the firm and the association, the firm caring for the disabilities arising during the course of employment, while the fund provides for those arising "off duty." In 17 of the 43 funds provision is made by the fund for medical treatment in some form. In 4 of these 17 cases the firm either Joins in the expense of this treat- ment or assumes the expense of a certain part of it, as indicated above. The treatment provided by the funds is in the main confined to the members, but in one case arrangements are made whereby members of the family receive medical attention at reduced charges. In 16 of the 17 funds providing medical treatment, one or more physicians are retained either upon salary (8 cases) or by definite agreement in respect to charges (8 cases). In 1 case there is no arrangement with physicians but treatment is provided when needed. In 11 cases this treatment is extended to the home of the disabled member, in 3 cases it is confined chiefly or wholly *to the establishment, and in 3 cases information on this point was not reported. In 13 cases surgical care is provided, but in some of these cases this care amounts to little more than first aid, or is provided in special cases, while in one case there is no limit on care given. In only 10 cases is there any claim to furnishing hospital care, and this usually by order of the association physician or by vote of directors of the fund. In one case provision for 3 weeks hospital care is made; in another the sick benefits can be turned to payment for hospital care, while in one the care is confined to tuberculosis cases. In a few instances provision is made by the fund for nursing and for medical supplies. However, these services are more commonly furnished by the firm and will be treated in that connection. In addition to the medical treatment furnished by the establishment funds it was found that a considerable number of the firms make pro- vision for treating their employees, especially in cases of emergency. This treatment is in some instances supplementary to treatment furn- ished by the fund and may have been undertaken in connection with the physical examination of applicants for employment. Of the 115 funds reporting, 72 made no claim of furnishing physical care. Of the 43 claiming to provide some physical care, such care amounts to little "Ibid., p. 441. r548 more than advice and first aid. Twenty-three maintain on salan^ one or more physicians. In 4 additional cases the firm joins with the fund either in sharing the expense of the physician, or in furnishing part of the medical treatment. In three other cases the firm makes provision for treatment when it is needed. In the remaining 13 instances the nature of the care was not reported. In 9 of these 30 cases this treatment is confined to the establish- ment except in cases of emergencies. In 15 of the cases the information indicates that the care is extended to the home of the employee. In a majority of these instances this care is, however, in connection with emergency cases and does not extend much beyond general medical advice and first aid. The same general statement holds concerning hospital care, nursing, medical supplies and dental care, furnished by the firm. It was found to be quite common for the firm to furnish hospital care in accident cases, but this is not customary in sickness cases. In 21 cases one or more nurses are retained to assist in medical treatment. Usually this service is supported wholly by the firm although in one instance the fund shared the expense. In some instances nursing is confined to first aid and emergency cases in the establishment, while in others the nurses visit the home of the disabled employee. In one case where a consider- able number of female employees were at work, provision is made for 3 nurses at the place of work and in addition 11 visiting nurses are em- ployed to visit the homes of the employees. In 30 cases medical sup- plies are furnished either by the firm or the establishment fund, but most commonly by the former. These supplies vary from first aid supplies to the filling of prescriptions free of charge. Finally, in 8 cases it was claimed that some dental care is furnished but with two ex- ceptions this care is in emergency cases only. Tw^ cases were found where dental work is furnished employees at cost and in one of these the cost is confined to cost of materials as the dentist is retained on salary by the firm. In addition to the medical treatment described above one benefit association has given special attention to tuberculous cases. Provision is made for care at a sanitorium. The amount and results of this treat- ment for the two years 1915 and 1916 compared with cases not so treated are shown in the following table. There was also found an association of employers that maintains a sanatorium in New Mexico, primarily for the care of tuberculous cases among employees and members of their families. Forty-one of the forty-four members of the association were located in Chicago. rreatment is furnished to employees at cost and in some cases where the employee cannot afford it, the expense is borne by the firm. It would appear, therefore, that many establishments do not do more m the way of medical treatment than to give advice and temporary re- lief for sickness at the plant. When further treatment is needed in the home the employee is advised to call his private physician. Many con- cerns pursue this policy to avoid opposition from the medical profession. rhey may, however, follow up a case to see that proper attention is given. 549 TWO YEARS ESTABLISHMENT EXPERIENCE WITH TUBERCULOSIS. Years. 1915 1916 With sanatorium treatment — Died at sanitorium Left sanatorium and died Lump sum settlement Left sanatorium with 52 weeks benefits. Recovered and returned to work Still disabled at sanatorium Left sanatorium but still disabled Total Without sanatorium treatment — Died Lump sum settlement Recovered and returned to work. Drew 52 weeks benefits Still disabled Total. 22 5 3 4 1 1 5 1 14 9 20 29 7 7 56 50 1 11 3 5 9 1 13 10 31 In only two cases were any data received as to how long the above services were extended without charge to the employee. Where replies were given they were in general terms such as "depends on extent of injury" or "as required." The duration of such .services without extra charge is of great significance, if benefits of this character are to be paid out of a fund established by premiums. Conclusion. — From the foregoing study of the methods of re- lieving the burden of sickness, certain conclusions can be dra^vTi. In the first place, the growth and elaboration of the provisions for relief of sickness through establishment funds is convincing proof of the felt need for such measures. It is also clear that this method of caring for sick- ness, developed on a voluntary basis, has after all been provided in only a relatively small number of plants and only for a relatively small pro- portion of the wage-earners of the State. A third feature is the great diversity of provisions. Some funds are well managed and have liberal benefits, others are poorly managed and the benefits are inadequate. 550 SPECIAL REPORT XII. TRADE UNION BENEFIT SYSTEMS. . (By A. E. Suff&rn, Ph. D.) JiLtruduciiuii. The Health Insurance Commission as a part of its investigation of voluntary mutual insurance undertook a survey of the provisions found among national, international and local trade unions. Similar surveys have been made by other states and by the Federal Government.^ Those by the states have been for the purpose of determining the extent of such arrangements in particular jurisdictions and those by the Federal Government to obtain information that would be representative of the situation in the country at large. Such provisions were first made by local unions and were grad- ually incorporated into the trade union program as unions in creased in size and became stable organizations. In fact it was early appreciated that mutual insurance would give a much-needed protection and en- courage cohesion and solidarity on the part of the trade union mem- bership. The earliest known attempt to make use of benefit funds is found among typographical unions which established death benefits in 1815.2 It was not until after the Civil War that unions attained sufficient control to establish benefit features national in scope. The national union to pioneer in this matter was the Brotherhood of Locomotive Engineers, which established death and permanent disability benefits in 1867.* With the rapid growth of national unions in the eighties and nineties many of them instituted the death benefit at the time of their organization. This is the form of benefit most frequently pro- vided, but during the last thirty years there has been a gradual widen- ing of the range of benefits so as to cover accident, sickness, permanent disability, superannuation, death of wife or other dependent, and un- employment. The local unions have followed much the same course of development during the last thirty years. Of the more than 110 important national and international unions in the United States 94: have reported to the Commission their mem- bership in the State of Illinois. All told, these 94 have 2,339 local unions in the State with a membership of 387,285. To these should be added tlie number and membership of locals affiliated with national and international organizations not reporting to the Commission and the number an d membership of locals without such affiliation. From the Review'^AuLl^T^^'^^ntlhi'^T^^ 5^^'"'"^ ^^ ^- -^^ ^°*^- °/ ^"^^^^ 1909' and Monthly « ri«ii^« *i'Jw V- ®^ \^o ^- ^- Bureau of Labor Statistics. •Ib?d S 244 ^ilt^^'li^^^V °^ Commissioner of Labor, p. 200. Unions ••>(>fcM;^««fc!«; n^L^l^P^^I: "Beneficiary Features of American Trade Series XXVI ^^^^^""^ University Studies in Historical and Political Science, 551 information at hand, it is estimated that the total number of locals in the State is somewhat more than 2,500, with a membership of 410,000 or more. Eighteen national and international organizations have made syste- matic provision for the payment of sick benefits. Fifteen of these are lepresented in Illinois with 336 locals and 33,208 members. Benefits are paid in sums varying from $3 to $12 per week, usually with a maximum of 12 or 13 weeks in the year, for disabilities lasting more than 7 or 14 days. Some of the locals of at least five of these fifteen organizations provide additional sick benefits ranging from $4 to $10 per week. These five nationals and internationals have a total of 183 locals with a membership of 17,097 in the State. There are perhaps 380,000 unionists in some 2,200 locals not affili- ated with those nationals or internationals which provide sick benefits.* By questionaires and by correspondence information was secured- from 898 of these mth 194,524 members. Of these, 223 with 70,443 members were found to have made provision for the payment of sick benefits ranging from $4 to $10 per week. Of this membership there were 58,391 who had met the various requirements set up by the unions, and were eligible for benefits. Our experience in securing information from these unions has led to the conclusion that the returns are fairly repre- sentative of the entire number of locals not affiliated with general organi- zations providing sick benefits. If such is the case, there would be some 136,000 unionists in the State with membership in local unions making provision for benefits paid out of local funds. In this way an estimate is arrived at that 41 per cent of the union men and women of the State are connected with unions maintaining national or local systems of sick benefits. It would appear that more than four-fifths of these are "bene- ficial" members. Hence it mav be said that about a third of the mem- bers of labor organizations in the State are paid sick benefits in accord- ance with the rules under which the funds are administered. Many national and international unions provide funeral benefits or death benefits amounting to life insurance. It was found that 64 national organizations, with 1,591 locals and a combined membership of 229,046 in Illinois, provide funeral benefits and life insurance rang- ing from $20 to $4,500. In connection with death benefits as well as sickness benefits, many local unions also pay something in addition to the amount provided by the national organization. This may range from $20 to $500. The request for information brought a response from 771 of the 1,591 locals among national organizations paying death benefits. Of these locals, 83 with a membership of 28,146 indicated that they paid additional death benefits varying as stated above. Among the important national organizations not providing death benefits is the United Mine Workers of America. In this case the State organization (District XII) pays a death benefit of $250. There arc *The Commission has reports on 1,923 such locals with a combined member- ship of 337,704. From available information it seems that there are perhaps be- tween 250 and 300 locals affiliated with national organizations not reported or without affiliation with any superior body. Hence the above estimates which can be regarded as only approximately correct. 552 305 miners' locals with a membership of 90,000 in the State. Of these 127 locals with a membership of 41,697 reported. In this organization many locals also pay additional death benefits ranging from $25 to $500 Of the 127 locals reporting it was found that 90 with a membership of 31,575 make this additional provision. Beturns were also received from 62 locals with a membership of 24,396 paying death benefits in sums ranging from $50 to $400. The national organizations of which these locals were members paid no death benefits. Combining data at hand it may be estimated that approxi- mately 7 in 8 of the members of unions in Illinois belong to organizations paying death benefits or providing life insurance out of the local, state, or national funds. The degree of protection in union funds can only be appreciated by a detailed study of the conditions under which a member may gain entrance to the fund, the provisions relating to the waiting period, the duration of benefits, the amount of benefit per w^eek, and the causes which may deprive him of benefits. The adequacy of such benefits is further affected by the extent of medical care which accompanies them. The method of administration of claims and the administration of the fund may be greatly affected by trade union policy and in the last ' analysis determine the degree of security which the member may have of receiving protection. These matters will be considered in the re- mainder of this report. Membership. The conditions under which membership may be obtained in trade union funds affect vitally the value of this form of insurance. In most of the national unions membership in the benefit fund is compulsory if the applicant can pass a physical examination.^ In many others membership merely entitles one to take advantage of the protection if he is free from chronic disease and if he meets the requirements of age and length of affiliation. Among 151 local unions^ reporting that they provide sickness benefits, 74 per cent make membership compulsory, but only 23 per cent of these require a medical examination. The amount of care in the selection of risks was found to be somewhat greater among locals permitting voluntary membership for thirty-seven per cent of these locals require a medical examination. Many of the national unions have set up age limits as a condition of membership, in the benefit funds the lower limits^which vary from 18 to 21 and the upper limits from 40 to 60. Practically the same variation exists among local unions with the emphasis upon an upper limit. Twenty-four per cent of the locals reporting have such a regula- tion. This requirement is often softened by admitting the member to trade privileges and partial benefits. Another qualifying factor in regard to membership is frequently found in connection with a minimum time of affiliation before the mem- 1 2if ***i^'^^^^f ^*^!^^^^ Report, V. S. Commissioner of Labor, p. 26. ^ . . .* petaUed reference to features of membership, benefits, revenues, and f u i"i5^'', ci°r °\ '°P^' unions are based upon more comprehensive information furn- ished by 151 locals from various unions in response to a second questionnaire. This waa sent to locals known to have sickness benefit funds 553 ber is permitted to receive benefits from the fund. Among both na- tional and local unions this requirement may vary from a few weeks to one year. The most usual periods are 3 and 6 months. A further limitation on membership is placed upon those suffering from chronic disease. Thirty-seven per cent of the locals reporting include this regu- lation. That these exclusions are effective is shown by the local records covering 1,917 men. There were 157 members who were excluded be- cause of the age limit, 573 because of too brief affiliation and 9 because of chronic disease, or a total of 739 among the grand total of 1,917. Temporary Disability Benefits. The two forms of temporary disability benefits which trade union funds provide are for sickness and accident. The rate of benefit is usually the same for both, but in many instances there is either no wait- ing period for accidents or the period is less than for sickness. Among the national unions providing temporary disability benefits three-fifths have a waiting period of seven days, the others fourteen days. It has been shown by a recent federal investigation^ of national union funds that the length of the waiting period has a very decided effect upon the extent of the claims upon the funds. A waiting period of fourteen days as against one of seven decreases the claim for disability by one-third. Among the local trade unions in the State reporting 18 per cent had no waiting period, 2 per cent had a period of less than seven days. For 53 per cent the period was seven days, for 14 per cent a period of four- teen days. The remaining 10 per cent was distributed among local unions having a waiting period of between seven and fourteen days, and one with a period of 21 days. The period during which benefits may be claimed is another im- portant factor affecting the degree of protection. Among national union funds^ it varies from six weeks to two vears, "with three months as the most frequent period. Practically the same variation is found among local union funds except that the range falls below six weeks in a few cases and that provision is frequently made for extension of benefits by donations. One union pays $7 a week indefinitely. Others pay the full rate for a specified period and then reduce the rates for further periods. Among national union funds the cash benefit per week varies from $3 to $12. The most frequent rate is $5 per week. Much the same may be said of local union funds. Here, however, in a few cases, the practice has been established of paying graded rates, the minima vary- ing from $3 to $7 and the maxima from $4 to $10. Not only are these money benefits inadequate to meet the needs of a family in time of sickness but there is almost a complete absence of medical and hospital care among national and local union funds. Four local unions report that the attending physician is paid by the union. A few others state that hospital care and surgical treatment is furnished in case of need. Practically all of the national unions provide for forfeiture of benefits in case temporary disability is caused by intemperance and im- moral conduct. Seventy-six per cent of the local unions reporting put ''Monthly Review of United States Bureau of Labor Statistics, August 17, 1917, p. 29. 8 Ibid., p. 29. 554 'jaqmaui jad 1803 dSBJOAY pdiqtssip J9d poAidaeJ )anoai« sSBJaAV •V'^'T^-yniOJ, ■paiesuddiuoo joqaiaai 8i£t3p 9)J8J8Ay 'Jdqmaui J9d ^^niQBSip sisp 93ej3Ay 'P9)BSU9dai09 iljniqBSip sXb'p lu'joi •yf^mq^sip '8)gaa9q 8ai -A]939J 93B)U93Je,I 's^gaaaq SJ9qiU3Ui Joquin^ §1 •uinui -JXBK •uinuiju{i^ •9}BJ poxg Xl3l30A\. 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CO r^co «) . »-l i-l CO »cc4e4e4cocoic«o COi- 'to irt ■>*< 25 t^ C^ CO (N rH ■»!< (NCOIM CO .-( C<1 lO T-i ■ -^ !£> too CO CO T-i to "O CO o osoooi-H 00 M 1— I T-( CO 1-t C^COtOCOtOOOiOtOC^OO ootocoooO'-ieoooeoco ^ 00 1-1 CO -^ c< CO t^ 8 £S?§?5^ l>C(N CO CO 1-H 1-^ OOO Tfi lO T-l o toi^ o »o (N IM CsiO ■0 t»'^t~00010St>-0 tOt^tO'*t>-CiOCOC'4 050iOOtO'-iiOO •* t>-i-i 1-t 00 ■^OOCO C^Oi-ItHCO'^i-I COt-HiO-^iCiOt ~ — " N '•'■' >- t ■>»'* >^f '^^ ^^^ ' — ' " ) TtiiC lO O C^ (N 00 1 o'cfi-Tc^Ti-r T-T 1-1 rH .-1 «0"3 (MO>OCOi-t»^OO^tDiO* Oi* i-IT)H(MOO* uOOtOOOI>* (M* 050* lOOOOCOTti^* lO 00 O »C CO 0> 05 1» O iS r-l 00 t>-00005 T-ICOCOt^O» t~- .-100 00O>tO-*>OfM 0 to OOCO CO .-I t-i (M i-l 00 OTj.>0 iO'^inTj!o6do6i-HCsc4deococoduidc>ieodddddc^i>t>^do6dc4c*T(5e^dd ea .-1 t-t r-l r-i i-t r-t T-1 i—l i-l CO CS T—l TH C^ CO CO rH i—l i— 1 rH rH rl iC<*'OOt»t^"5i-Hi005000000CO tO tO tO CO ■* Ol OU3«0'^»0'^t-t>-eOOOt^U5iC>dO»0'Ou5iOOOU5iOtOC'^J>t^'*l>.t^00.-ITl.rJt^OCOt^ rH F-l .-( i-( .-( rH „ rH rH i-l C<1 i-H rH ^^ »w i 8SS§g3Sgg:5;5SSSS2gi2n3 rH 1— ( rH O) rH t>> >OC<|iCQOOt--l>03rHiOTfOTt<>Oi— lC^t--T}'od'0'— (05t-»ioio >C^lOOOOt^005rHlOTl4rH(MtO* IC ^ ^^\ r-— i(-\ 1?^ ««4 »^s ^M *^i » — .^d r — «A .A ;k . — _._COt^»OiO-^U5(N?it>irpJ>.COCOo5 T-lOC0C010rHrHC!jrH rHTjf (NrH ocoot l-irHrH^^^C^CO^^ « a> _ Q 03 (HtOCOWWcOMOTtO |.S.S.2.2.S.S.S.S§ Kl ra CO OT u >M fc^ ;-■ o (U a> a> ^ C3 PLiPh CO o 03 M CO CO a; (h Jh (_, r*1 •^'JS'JOtOtOtOt^t^t-OOOOOJOJOOOrHrHrHrH Pi rt o d •rH -iH -rH .pH -— i_, ^Cdc3^^^fr-i4lj fL| Ph pL| fL, Ph P4 Ph M lOOOt^OO CO ^ rH rH 555 S ^ 00(N r^ o?(N m ■^ ^ lO 05 iO T^O CO si >-^ CO ;C w )lO CO io O CM -^ CO o c5 CO oo (N CO CO -^ r-l .-H ■^ o CO 8Si 80 O CO — ( o o CO <0 t— ro Tt< 05 C< t-- T-l O I— I •>*< O O ■* CO IM Q ■^ O Ol "O CO t^ o •>^ t^ c> o c^ o e^ Tfi Tf >— 1 1— 1 10 g CO CO O t— 30 CO CO -^ CO lO !0 CO w^ ^ '^ ^ I-H 1-1 1-1 CO -H O M COt>-CO -^ 1-1 CO 5 .-t CO CO "0 •* 1-" iOC50 T-i 1-1 c. Tf 05 O CO IM t>^ cx5 1-1 c5 lo t> >o 1-1 rH CO CO 1—1 05 -H in ■*! CO 1-1 0 t- t^ lO CO 1-1 0>ncOCOCD » t>» t^ t^ t" t» ,-1 .--< c c; c 5 -J -T CO -H '-0 C^ CO ^0 ■* ,-,rt COOJ 1-1 3 H <— 1 CO H ••-^ n ^ CO H S ?^ CSC 000 .^H -r^ .—4 C C G ^03 03 03 M o .a o " — 'xiA .c £ C Cftft « 5i 03 03 03 w 5 fcCtOtC C C O o o OS^ C^ CO (N CO CO CO 03 o ^ u a o o ;-• (V iC 0) CO 02 — o Oo o ^-: m C ■4-" aj ^ C GQ 0) 1-1 v,c! O !^ C^ 13 o,-, _, >< 0) CQ CO m a> o U3 ioO' d- o 'O CJ ■^ a ^ O u ■t-> 02, 0) c^ ^<2 m rrtai! 10 556 such a limitation upon their members while 62 per cent set up restrictions on conduct while the member is receiving benefits. Prohibitions against the use of liquor, engaging in any work, and disobeying doctors' in- structions are frequently found among these restrictions. In order that the variation and the nature of the provision made by different unions may be more fully comprehended it will be well to present certain features in tabular form from the data furnished by 44 locals for the year 1917.^ The schedules from these showed the number of members in the union, the members in the fund, the number of mem- bers receiving benefits and the amount spent for temporary disability. In connection with these data it is important to consider the length of the waiting period, the duration of payment, and the rate of benefit per week. All of these are factors affecting the adequacy and cost of protection. Out of a reported membership of 11,228 there were 10,148 or 90 per cent in the funds.^^ Of those in the fund 1,735, or 16 per cent, received benefits for temporary disability. The payments aggregated $40,002.41, or an average of $23.05 per case. This was approximately $1 per day per disabled member. This amount of protection was furnished at an average yearly cost of $3.76 per member. The members who received benefits were disabled for a total of 34,867 days, or an average of 23.8 days each. This average would not be changed greatly by including the disability of 270 members of three funds which failed to report on this matter. The report of 42,942 days as the total disability or an average of 4.72 days for the entire member- . ship, does not show the full number of days of disability. In the first place, seven funds did not report. Furthermore, all of the funds ex- cept two have waiting periods varying from 3 to 21 days. In most funds no attempt is made to keep a record of the disability of members who are not sick longer than the waiting period. The record of the 166 members in the funds without a waiting period is practically valueless as an indication of sickness experience. Too much stress should not be placed upon the use of averages as characterizing a particular fund or all the funds. The variation in the rate of benefit, the length of waiting period, and the duration of benefit are all modifying factors. Permanent Disability Benefits. The provision for permanent disability benefits supplementary to temporary disability is made by 19 national unions." The loss of a hand, foot or eye and paralysis are deemed sufficient basis for claim to this benefit. The amount paid for such disability is usually the same as that for death benefits. In some unions the receipt of permanent dis- ability bene fit deprives the member of any claim to a death benefit. In •flee Table I. »*Pund Number 117 Is a report of a Printers' Mutual Benefit Association which Includes members of many shops. The membership of 486 of this association brings the total of protected members up to 10,634 on nn^^*^i^;^'**r^jl^'I.H?i ^^KVi Vu ^^ Comrnissioner of Labor, p. 31. The tables abinty indicate that there are 22 unions paying for permanent dis- 557 others, he is entitled to reduced death benefits. Among some unions the amount paid varies with the number of years the member has been in good standing. For example, the United Brotherhood of Carpenters and Joiners pays from $50 to $400 in accordance with a variation of one to five years in membership. In other unions variations in amount of benefit is based on a classification both of length of membership and age. This is illustrated by the following scale established by the Amalgamated Association of Street and Electric Railway Employees. Members prior to Jan. 1, 1918. Under 45. 45-50 50-«0 Over 60. 2d year . 3d year . 4th year 5th year 6th year 7th year 8th year After... $100 $100 $100 $ 50 150 150 150 100 250 250 250 150 400 400 350 200 500 500 400 250 600 600 450 275 700 700 500 300 800 800 550 300 $ 50 75 100 100 100 100 100 100 Again such benefits may vary in amounts according to a classi- fication by age and the amount of monthly assessments paid into the fund. The plan is illustrated by the arrangement established by the Locomotive Firemen and Enginemen: Principal sum.* Weekly indemnity. Monthly assess- ments. Annual cost. $1,000 1,000 1,000 1,000 1,000 2,000 2,000 2,000 2,000 2,000 $7 $1.20 10 1.60 15 2.20 20 2.80 30 3.90 7 1.50 10 1.90 15 2.50 20 3.10 30 4.20 $14. 10 19.20 26.40 33.60 46.80 18.00 22.80 30.00 37.20 50.40 * The same principle is applied to the scale for amounts ranging to $4,000. Forfeiture of benefits occurs when the member engages in a more hazardous occupation, assumes "risks to which members of the trade are not usually liable," receives injury while intoxicated, or when he is in arrears for dues. There were 111,185 union men in the State of Illinois in 1917 in the national unions which pay for permanent disability. Death Benefits. There are nine national unions which provide death benefits under an insurance policy contract.^- All of these operate in the State of Illinois with a membership of $35,506. The minima of these contracts range from $300 to $1,500, and the maxima from $1,000 to $4,500. Membership in these funds may be either optional or compulsory, but " Twenty-third Annual Report, U. S. Commissioner of Labor, p. 30. 558 III tile majority of cases it is the latter, provided the member is within the age limit and can pass a physical examination. Some unions having compulsory insurance also provide for those who are unable to insure by paying a funeral benefit to non-beneficiary and honorary members. Among national and local unions paying funeral benefits members in good standing in the union are generally entitled to benefits. How- over, periods of membership varying from three months to a year are frecpiently made as a requirement before benefits are paid. In order to attract and hold members the plan of increasing benefits with length of membership has been put into effect in many cases. The amounts may increase for a period of ten years and run as high as $800. This arrangement may be accompanied by a requirement for medical examin- ation and by an age limit beyond which members may not enter into the scheme. As stated above, 173 locals reporting indicated that they paid death benefits in addition to those provided by the national union in sum ranging from $20 to $500. In cases where the local is an older organization than the national it is likely that the local death benefit was established prior to the national union benefit. A comparatively small number of locals (62) reported that their local benefit was the only one furnished by the union. Because of its easy administration the rapid adoption of this form of benefit by the national unions has met with little opposition. The payment of death benefits among the United Mine AVorkers in the State of Illinois presents rather a unique situation. Payment of death benefits has not been undertaken by the national union. The District organization, however, with its 305 locals and 90,000 members pays a benefit of $250. The Commission received reports from 127 of these locals. Ninety of them with a membership of 31,577 stated that they paid a local benefit in addition to the District benefit. The local benefit varies from $25 to $500, but $100 is the most frequent benefit paid. The local unions of Carpenters, Miners, Briekmakers, Painters and Street Railway Employees frequently pay a death benefit in case of the deatli of a member's wife or of his other dependents. The amounts imid in event of death of the wife varies from $25 to $125 and of children from $10 to $75. Forfeiture of death benefits is generally governed bv rules re- garding extra-hazardous occupation, taking risks other than the ordinary trade risks, death caused by intemperance, debauchery, or immoral con- duct and non-payment of dues.^* Bevcu ues. The financial support of these various benefits comes from entrance and re-instatement fees, special assessments and the regular union dues. 1 he ontrnnce fee paid to the national union may be either all or part of the fee paid to the local union.^* Where insurance certificates are issued " Twenty-third Annual Report, U. S. Commissionpr of T nhnr- r. "^i 559 and an insurance or benefit department is organized, fees are frequently paid to the union and to the department or fund. Special assessments are usually levied by the executive board or by a general vote of the members whenever the general or benefit fund has fallen below a stated sum. The use of this expedient introduces an element of safety which would not exist without it in most unions. Moreover, it avoids the necessity of close conformity to actuarial princi- ples. Also the unions in working out their main purpose of organizing trades improve the security of their funds by the steady induction of the young men into the union. The special assessment is also used by unions which make no attempt to establish definite benefits. Some locals follow the practice of voting a per capita tax whenever a member is disabled. Eighteen locals with a membership of 6,061 report such a provision, while ninety-five locals with a membership of 28,517 report cash donations of varying sums and tax their members to furnish these amounts. The main support of national and local unions is derived from the regular union dues. In several unions all the funds collected by the local "are retained in the local treasury, subject to the call of the national officers."^^ This arrangement is accompanied by a scheme for the equalization of funds. "In these unions only such funds as are necessary to the proper administration of the general affairs of the national union are sent to headquarters, the benefits being paid from the local treasury under the supervision of the general officers ; and when need occurs funds are transferred from one local to another at the direction of the general officers."^® Among the local unions in the State which have definite disable- ment benefits 52 per cent of those reporting establish a general benefit fund by the regular union dues. The claims for disablement are met out of the general fund. Forty-two per cent of the locals follow the practice of charging definite rates to establish a disablement fund. These rates vary from 2y2 to 18 cents per week. Three per cent of the unions set aside for the fund certain percentages of the regular dues varying from 5 to 331/3 per cent. The remaining 3 per cent made no report. The same rates are charged to all members unless they are divided into classes with definite rates for each class. Of the locals which reported on death benefits 60 per cent sup- port their funds from the regular union dues, and 28 per cent use special assessments. The others furnished no information upon this point. Moreover, only 50 per cent stated that a separate fund was kept for death benefits. This practically typifies the situation among national unions for in a majority of cases no separate benefit fund is established.^^ "In the majority of national unions members are not relieved from the payment of contributions, nor tnay their contributions to the national body be reduced for any reason; if the local deems the request for admission or reduction of contributions a worthy one it may act ac- cordingh', but the local must pay to the national body the full contri- ^^Ihid., p. 26. 18 17 IMd., p. 26. Twenty-third Ajimial Report, U. S. Commissioner of Labor, p. 27. Twenty-third Annual Report, Commissioner of Labor, p. 25. bution for the member. However, several of the national unions re- lieve sick or unemployed members from the payment of contributions."^^ Admitiistration. Among national unions the usual custom is to place the administra- tion of benefit funds in the hands of the regular officials. In some cases where there is a mutual benefit department, it is administered by separate officers." Under both systems the officers directly responsible for funds are generally bonded and hold their positions through election by a general convention or a general vote. Such officials, moreover, are sub- ject to supervision by the executive board or council. Of the locals reiEX>rting only 12 per cent stated that the adminis- tration of their local funds was supervised by the nationar organization. However, in 82 per cent of the locals it was reported that the funds were frequently audited. The period of audit varied from once a year to once ever}' month. In a majority of the cases audit was quarterly. The supervision of claims may be either in the hands of the officers or of a visiting committee, more frequently the latter. In 68 per cent of the locals reporting their efforts are supplemented by the requirement of a physician's certificate as proof of claim to benefits. The committee may be either elected or appointed and the members may be required to serve and to be subject to penalty for neglect of duty. The difficulties of this form of administration of claims are apt to be accentuated wherever the sickness benefits are paid by the superior jurisdiction. Laxity on the part of the local administration has been known to compel the national unions to institute campaigns against malingering in order to protect their funds and to remind locals that they would be subject to higher dues to meet the growing claims to benefit.^^ On the other hand where the local members are few in number and each is well known among his fellows there should be little difficulty in determining the validity of claims. At the same time it may be a means of preserving and developing the fraternal feeling so essential to unionism. In G2 per cent of the locals the member is given the right of appeal to the officials or to the union as to the validity of his claim. CoiK-lusion. What are the conclusions that may legitimately be draw^n from this survey of the operation of trade union funds in the State of Illinois? As a means of mutual protection and of encouraging allegiance to the union they have proven their worth. But considerations of adequacv immediately call attention to the need for further elaboration and greater comprehensiveness if the funds are properly to care for the burden of sickness. Among most funds the rates of benefit are too low to care adequatelv for the needs of the worker and his family when his wages are cut off. ^^" '^ ^^^ maximum period of payment long enough in most union »*Ibld.. p. 27. "R^norroT^th; SStIfn?v,"l^**'^^ Engineers and Letter Carriers. p. 42. Sixteenth Convention. 1917, Bakers and Confectionery Workers. 561 funds to provide for the cases where illness is prolonged. Although the length of the waiting period is usually short enough to include the greater number of short illnesses, there is still room for much improve- ment in this respect. Moreover, there is almost an entire absence of provision for medical and hospital care. Eyerything points to the need of such treatment to supplement the money payments which help the family to ward off poverty. More important than all these considerations is the fact that com- paratively few of the working population are protected by either trade union or establishment funds. As a rule it is only the skilled workmen that are protected by trade union funds and the majority of these are not insured against temporary and prolonged disability. Although a high percentage of trade unionists receive death benefits, in the great majority of cases the amount is small. In short there is every indication of a need for amplification of trade union benefits and for the inclusion of other features of pro- tection which will supplement what is already being done. —36 H I 562 SPECIAL REPORT XIII. THE PRESENT STATUS OF HEALTH WORK IN THE PUBLIC SCHOOLS OF ILLINOIS. (By W. G. Beeder.) INote by the Secretary.— The children of today will be workers of the next ireneration Their efficiency and mode of life then as well as their health while pupils depend to a considerable extent upon the medical care and supervision pro- vided by the school authorities. Realizing the importance of such provision, the Commission arranged with Mr. W. G. Reeder of the School of Education, the Uni- versity of Chicago, to ascertain what provision is being made by the school authori- ties of this State for medical inspection, nursing, and clinical treatment of school children. The results of his general survey are set forth in the following report.] I. Introduction. . Medical inspection, nursing and clinics in the schools are no longer in the experimental stage in Illinois, the United States, or in foreign countries. In this country medical inspection of school children is being widely practiced. It has been national in scope for many years in France, England, Belgium, Sweden, Switzerland, and Japan. It is found in some degree in Austria-Hungary, Bulgaria, Germany, Russia, Australia, Denmark, Norway, Roumania, Canada, Mexico, Argentine and Chile. Japan has long been one of the leaders in the school hygiene move- ment, as the following description of her system will attest. "The Japanese system of medical inspection extends all over the empire and reaches the most remote rural community. Thus the Japanese department of education is able to tell how many children are in the schools of the empire, how many are robust, medium, or weak, how many have defective eyesight, and what diseases are most prevalent at different ages of school life. The department can tell how many children in school, at the age of fifteen years, were 150 cm. tall, how many weighed 40 kg., and how many had a chest measurement of 75 cm. They can also tell the averages of all these statistics and the per- centages of robust boys or fat girls."^ English practice.— ~ln Europe, England furnishes the best example of legislative enactments under which theory and practice of educators and physicians have been crystallized in the field of school hygiene. In view of the fact that the English statute has been widely copied, es- pecially m the laws of other nations, it seems worth while to quote it in extenso. It is known legally as Section 13 of the Administrative Provisions of the Education Act of 1907, and reads as follows : 1 ^^' X CVx ^i^® powers and duties of a local education authority under Part HI of the Education Act, 1902, shall include; . o 03 CI 1 t-l ed in ng tests o o o t— 1 s TS a'C o o C3 s fl •^ cS e3 J3 , o OT fli t3 a o -§5 C/) CO en to >> ft C8 CO CO 1 students tr g sight and h > 'en a . CO ^ 2 M C -"-^ fa c3 fa =5 « 03 Cl a 'S'S O <» 8^ O o 5 o3 o k4 o g3 © CM <1 Q Q PL, E-t Z To what districts the law applies. California . . . Colorado Connecticut . Georgia Indiana Louisiana . . Maine Maryland . 9 Massachusetts . . . 10 Montana 11 Nevada 12 New Hampshire. 13 New Jersey , 14 New York 15 North Carolina . . 16 North Dakota . . . 17 Ohio 18 Pennsylvania . . . 19 20 21 22 23 24 25 Rhode Island.... 1911,15,17 1909 1909 1899,1907. 1914 1911 1908 1909 1914. 1906, 1908. 1917 1917 1913 1909 1910,1913. 1917 1915 1910,1913. 1911 Utah.... Vermont . Virginia. Washington West Virginia . . . Wyoming 1911. 1910. 1908- 1909. 1911. 1915. P. M. P. P. P. M. M. P. M, P. M. P. M M M P P. &M M. P. P. P. P. &M. M. S, S, s, S. & H, s, S. & H. s. S. or H S. & H S, s, s. s. S. & H, s, S. or H, S. s. • s. X X X X X X X X X X X X X X X Broad enough X X X X X X X X X X X X X X X X X X X Broad enough X X X X X x X Phys. X X X Xor Phys. Xor Phys. X X X Phys. X X X X X Phys X X X X X Where adopted. All. Where adopted. Where adopted. Where adopted. All. Cities under 40,000. Where adopted. All. Where adopted. All. Where adopted. All. All. All. Where adopted. Where adopted. Man. in 1st and 2d, per. in 3d and 4th class cities. Where adopted; sight and hearing all. All. Where voted; sight and hearing all. Where adopted. 1st class cities. Man in cities; per in rural districts. Cities and towns only. * In addition to the states indicated in the foregoing table, a few others give the boards of health legal right to promulgate rules and regulations. Since these go no further than the control of contagious diseases, especially in time of epi- demics, it does not seem worth while to include them in the list. The table is meant to give only a general idea of the different legislation, and for completeness and qualifications the laws themselves should be examined. Besides the dates when the several statutes were adopted and whether these are permissive or mandatory, the table shows : 1. The carrying out of tTie provisions of the law is usually placed in the hands of the school authorities; 2. Provision is made for physicians to examine pupils for con- tagious diseases and physical defects; a lesser number of laws provide for the examination of teachers, janitors, and school buildings; 566 3. Provision is made for the teachers to give sight and hearing tests, under proper direction; a lesser number of states provide that normal students be trained in giving these tests; 4. School nurses are specifically provided for, or else the law is broad enough to include them. Though a common vein runs through practically all the laws, they differ in detail, as in provision for : vaccination of pupils and teachers ; exclusion from school of pupils and teachers in times of epidemics, etc. ; penalty for violation of tlie law ; medical and dental care ; Chief Medical Director of Schools ; appropriations for the work ; communities to which the law applies; and follow-up work, and the duty of parents. Since the Massachusetts law has been used as the basis for a majority of the bills which have been presented in our state legislatures, it seems worth while to quote it in extenso. The law (Chapter 502, Acts of 1906) reads as follows: AN ACT RELATIVE TO THE APPOINTMENT OF SCHOOL PHYSICIANS. Be it enacted, etc., as follows: Section 1. The school committee of every city and town in the Commonwealth shall appoint one or more school physicians, shall assign one to each public school within its city or town, and shall provide them with all proper facilities for the performance of their duties as pre- scribed in this Act; provided, however, that in cities wherein the board of health is already maintaining or shall hereafter maintain substan- tially such medical inspection as this Act requires, the board of health shall appoint and assign the school physician. Section 2. Every school physician shall make a prompt examination and diagnosis of all children referred to him as hereinafter provided, and such further examination of teachers, janitors and school buildings as in his opinion the protection of the health of the pupils may require. Section 3. The school committee shall cause to be referred to a school physician for examination and diagnosis every child returning to school without a certificate from the board of health after absence on account of illness or from unknown cause ; and every child in the schools under its jurisdiction who shows signs of being in ill health or of suf- fering from infectious or contagious disease, unless he is at once excluded from the school by the teacher ; except that in case of schools in remote and isolated situations the school committee may make such other ar- rangements as may best carry out the purposes of this act. Section 4. The school committee shall cause notice of the disease or defects, if any, from which any child is found to be suffering to be sent to his parent or guardian. Whenever a child shows symptoms of small pox, scarlet fever, measles, chickenpox, tuberculosis, diphtheria or influenza, tonsilitis, whooping cough, mumps, scabies or trachoma, he shall be sent home immediately, or as soon as safe and proper convey- ance can be found, and the board of health shall at once be notified. Section 5. The school committee of every city and town shall cause every child in the public schools .to be separately and carefully tested and examined at least once in every school year to ascertain whether he is suffering from defective sight or hearing or from any other dis- ability or defect tending to prevent his receiving the full benefit of his 567 school work in order to prevent injury to the child or to secure the best educational results. The tests of sight and hearing shall be made by teachers. The committee shall cause notice of any defect or disability requiring treatment to be sent to the parent or guardian of the child, and shall require a physical record of each child to be kept in such a form as the state board of education shall prescribe. Section 6. The state board of health shall prescribe the directions for tests of sight and hearing and the state board of education shall, after consultation with the state board of health, prescribe and furnish to school committees suitable rules of instruction, test-cards, blanks, record books, and other useful appliances for can-ying out the purpose of this act, and shall provide for pupils in the normal schools instruction and practice in the best methods of testing the sight and hearing of children. The state board of education may expend during the year nineteen hundred and six a sum not greater than fifteen iiundred dollars, and annually thereafter a sum not greater than five hundred dollars for the purpose of supplying the material required by this act. Section 7. The expenses which a city or town may incur by virtue of the authority herein vested in the school committee or board of health, as the case may be, shall not exceed the amount appropriated for that purpose in cities by the city council and in towns by a town meeting. The appropriation shall precede any expenditure or any in- debtedness which may be incurred under this act, and the sum appro- priated shall be deemed a sufficient appropriation in the municipality where it is made. Such appropriation need not specify to what section of this act it shall apply, and may be voted as a total appropriation to be applied in carrying out the purposes of this act. Section 8. This act shall take effect on the first day of September in the year nineteen hundred and six. (Approved June 20, 1906.) Under the provisions of Section 7, many communities failed to make any appropriation, consequently no inspection service was established in some places. This section was repealed in 1908, so that now the work is carried out to some extent in nearly every city and town in the Commonwealth.® The experience of other states and countries suggests that new state legislation for the proper health supervision of srchool children should include the following:'' 1. Provision that the administration of the system be in the hands of the school authorities, but that they be empowered to delegate their authority to the local health officials, and that in the treatment of cases of contagious diseases the school and health authorities shall cooperate. Provision should be made for the Health Department of any city to continue the administration of the system, so long as the requirements of the law are met. 2. Provision for inspection by school physicians to detect and exclude those with contagious diseases. 3. Provision for annual physical examination of all pupils by school physicians to detect any physical defects which may prevent * Resume of the Present Status of Medical Supervision of School Children in Massachusetts, p. 5. ^Chiefly from Gulick and Ayres, Medical Inspection of SchoolSj ed., 1913, p. 171, et seq. 568 the children from receiving the full benefit of their school work or which may require that the work be modified to avoid injury to them. Provision for correcting such defects should be made. 4. Provision that teachers give sight and hearing tests annually, and under proper direction. 5. Provision that students in normal schools shall receive train- ing in giving sight and hearing tests. G. Provision that school physicians may examine teachers, janitors, and school buildings. 7. Provision for the employment of school nurses. 8. Provision for medical and dental care, and clinics, especially for indigents. 9. Provision for better standards in hygiene and physical training as now taught in the schools. 10. Provision for a Director of Educational Hygiene in the state, working in cooperation with the office of the State Superintendent of Public Instruction. 11. Provision for adequate funds to carry out the health super- vision policy, perhaps a separate fund.^ 12. Provision for enforcing the law. These provisions would be in general harmony with the spirit of resolutions adopted by the Conference of State and Provincial Boards of Health, Los Angeles, California, in July, 1911, as follows : "We endorse legislation providing for the medical inspection of schools, because extended and varied experience has demonstrated that efficient medical inspection betters health conditions among school children, safeguards them from disease, renders them healthier, happier and more vigorous, and aims to insure for each child such physical and mental vitality as will best enable him to take full advantage of the free education offered by the state. "It is our judgment that every law providing for the medical in- spection of schools should also make provision for frequent inspections ot the children by duly qualified school ph3^sicians to detect and ex- clude cases of contagious disease. "It should further provide for annual physical examinations of all the children by school physicians to detect any physical defects which may prevent the children from receiving the full benefit of their school work or which may require that the work be modified to avoid injury to the child. "It should empower school physicians to conduct examinations of teachers and janitors and to make regular inspections of buildings, premises and drinking water to insure their sanitary condition. "We endorse the school nurse as a most valuable adjunct of medical inspection and believe that provision for the employment of school nurses should be included in each law." II. What Illinois is Doing. The main body of this report presents the results of a study under- taken to discover what the schools of Illinois are doing to promote • Many superintendents In nilnols stated they were doing nothing in health woik because of lack of funds ; others stated they would do more if they had the funds. 569 health. The facts for the study were secured chiefly through question- naires. Some of the information, however, was gathered by personal visitation, and, in addition, a large body of statistics were obtained from the offices of the State Superintendent of Public Instruction and the State Department of Health at Springfield. The results of the study should be considered in the light of the meagerness of data bearing upon the problem, and the widely varying attention given to the health of school children throughout the State. In the absence of State legislation providing uniform standards of medical inspection, the health supervision of school children is left entirely to local authorities. The effectiveness of the supervision varies from the extensive work carried on by the Division of Child Hygiene in the Department of Health of Chicago, to the absence of any syste- matic supervision in the rural schools. In view of these widely vary- ing conditions this study can be but a rough survey and should be so regarded. The investigation has been divided into two parts, the one relating to urban, the other to rural schools. In order to secure information from all cities that are doing some- thing toward health promotion work in the schools, it was decided to send a questionnaire to the superintendent of schools in all places in the following groups: First, those cities with a population of 5,000 or over as shown by the census of 1910; second, cities and villages with a smaller population reported by the county superintendents as having school physicians or nurses; third, township high schools located in the cities of the first two groups. Questionnaires sent to 70 in the first group brought 65 replies ; to 30 in the second group, 24 replies ; to 32 in the third group, 21 replies. Thus, there were sent to city superintendents and high school principals 132 questionnaires from which 110 replies were received. To get a general survey of what the rural schools are^ doing in health promotion work, as well as to help make up the list of cities in the second group above, a short questionnaire was sent to each of the 102 county superintendents of schools. From these 99 replies were received. Though Illinois is one of the few states not having legislation for the health supervision of school children it may not be gainsaid that protection for the safety of these has been entirely lacking as the fol- lowing paragraph resume of legislation will attest. In 1877, the Legislature passed a bill to prevent and punish those doing wrongs to children. Subsequently, legislation has been enacted requiring the teaching of physiology and hygiene; and proper hygienic, sanitary, and safety conditions in all public school buildings (1909, 1915) ; prohibiting the use of a common drinking cup in all schools and public places (1911) ; providing for the education of crippled, deaf and dumb and blind children (1911, 1915); and requiring physical training in the public and in all the normal schools (1915). Illinois has also a very efficiently organized Department of Public Health, which has done much to promote health work in the schools. But the State 570 is still without legislation relating to the health supervision of school children. Without the stimulus of either permissive or mandatory legislative provision for health supervision of school children, what are the schools of Illinois doing in an exercise of their powers under the general school law? The following pages of this report will attempt to indicate the nature and extent of their activities. What the city and village schools are doing. — The Federal Census of 1910 reports in Illinois a total of 1,605 cities and villages with a population of 100 or over. Of these, 1,240 have populations between 100 and 999; 295 have populations between 1,000 and 4,999, and 70 have populations of 5,000 or over. This wide variation in population, with accompanying variation in school population, suggests a wide range of problems to be met in at- tempting to survey the present status of school hygiene work in this State, especially since there is no legislative provision for a standard plan. In this resume it is assumed that each of the above communities has a public school; those that do not are negligible in number, and are probably offset by those villages of less than 100 having a public school, but not included in the above list. In most phases of health work our data probably take account of practically all places doing systematic work in the various activities. In such activities as teach- ing hygiene and physical training, however, our data are probably repre- sentative only. School physicians and physical examinations. — The returns from the investigation show that 31 cities and villages, or about 2 per cent of the total, regularly employ school physicians. Many more indicate that they have had inspections in times of epidemics only; these, how- ever, in this study, are not credited with having school physicians, since it is emergency work, and is usually done by the local health officer, and without pay, except the little he gets as salary as health officer. Our tabulations, in Table II below, include only those cities that employ physicians regularly, either- part or whole time. Only 3 cities employ full-time physicians, while 28 employ part-time physicians. TABLE II— CITIES AND VILLAGES EMPLOYING SCHOOL PHYSICIANS, AND NUMBER EMPLOYED.! Number of physicians employed. Cities and villages employing number indicated. Total number employed. 1* 20 3 5 2 1 ♦20 1 •} 2* 4'in 3* *(i 8 full-time plus 149* 157 Total... 31 196 • Part-time employees. t Our data from most places were gotten in September just before the influenza epidemic. Data gathered .since would probably indicate a better showing in both ^# f^iP Pl^y«*c'*"» ^^^ nurses (for nurses, see Table VII), on account of the ravages 571 Table III indicates a gradual increase each year in the number of cities and villages having school physicians. Chicago introduced them as a regular part of the school activities in 18-9 5, being the first in Illinois, and the third city in the United States. Evanston folowed in 1900. TABLE III— NUMBER OF CITIES AND VILLAGES HAVING SCHOOL PHYSI- CIANS IN EACH YEAR, 1895-1918. Year. Number of cities and villages. 1895 1 1900 2 1910 4 1911 7 1912 8 1913 9 1914 10 1915 12 1916 14 1918 24 No date given (7) 31 Without attempting to discuss the question whether school phy- sicians should be under the supervision of the school or the health authorities, Table I has pointed out that it is the policy of most states to place them under the supervision of the former. The practice of Illinois cities, as Table IV shows, conforms to this policy of other states. Chicago is the best known example of health department direction in Illinois, and one of the best in the United States. TABLE IV— SUPERVISING AGENCY FOR SCHOOL PHYSICIANS. Supervising agency. Number of cities and villages. By school authorities By board of health By board of health and school authorities By private organization Total 25 2 1 3 31 As might be expected, the paying agencies are usually the same as the directing agencies; in one case only is there an exception to this custom. Table V shows the paying agencies in full. 572 TABLE V— PAYING AGENCY FOR SCHOOL PHYSICIANS. Paying agency. Number of cities and villages. School authorities Board of health Board of health and school authorities Endowment Gratis Total 25 1 1 3 1 31 From Table VI it is evident that in only a few instances is the salary sufficient to provide more than a small part of the physician^s living, which situation means that in most cases the physician will not be stimulated to study and improve himself in this phase of pre- ventive medicine. Moreover, he will tend to slight or neglect his school work when pressed with other duties, which primarily secure his living. More places pay fees according to service rendered than any other method. One city is unique in that it pays a given amount per pupil, the amount being 50 cents. TABLE VI— YEARLY COMPENSATION OF SCHOOL PHYSICIANS. Yearly compensation. Number of cities and villages. Part-time. Full-time. Gratis 1 1 10 Per pupil Fees according to services Endowed 1 t 100to$ 200 1 3 1 *2 201 to 300 301to 500 601 to 1,000 1,001 to 1,290 1 l,500to 2,000 1 Information incomplete 9 Total 28 3 Clans Se*^^ven'tn\h^' tabie^^^^ group, but only the salaries of the part-time physi- There is no common practice as regards the nature or frequency of the exammation given the pupil. In general, it seems to include the skm, defects of eye, ear, nose and throat, heart, lungs, and teeth; the general condition is noted also. In Chicago, the examination appears to be the most thorough of any city. From the information gathered, it is apparent that the examination varies in the different cities from superficial to thorough, and its nature and extent depend on the conscientiousness and ability of the examiner, the number of pupils to be examined, and the amount of time spent in the work. Usually, there is a going-over of all pupils annually at the beginning of the school year; a few communities have such examination two or more times during the year. Some places report that, aside from th€ regular examination, the principal may call the physician 573 at any time when his services are deemed necessary. In some half- dozen cases, the physical training director gives each pupil a complete physical examination each year. School nurses. — As shown by Table VII, there are 54 communities having the services of a school nurse. This means that about 3 per cent of the city and village school systems employ them. A few more stated their desire to introduce the work this school year, but were having difficulty in finding available nurses. TABLE VII — CITIES AND VILLAGES EMPLOYING SCHOOL NURSES, AND NUMBER EMPLOYED.! Number of nurses employed. Cities and villages employing number indicated. Total number employed. 1* 11 37 4 1 1 *11 1 37 2 8 4 4 120 120 Total... . 54 180 • Part-time nurses. t See note on Table II. The majority of communities employing nurses have populations of more than 5,000. Only ten places smaller than this employ them. There are 10 communities having the services of both physicians and nurses, while 75 have one or the other. The part-time nurses give a certain amount of time regularly, or else do work occasionally as emergencies or special work necessitates. One city (Waukegan) reports an employee who serves part time as school nurse, and part time as truant officer. Table VIII shows how the movement for school nurses, at first slow and gradual, has become in the later years increasingly rapid. As in respect to school physicians, so in respect to school nurses, Chicago was the first Illinois city to use them.^ Galesburg followed, with the employment of a part-time nurse, in 1909. »In 1901, nurses of the Visiting Nursing Association began to visit the crippled children in four of the public schools. It was not until 1908, however, that nurses were employed by the Board of Education. 574 TABLE VIII- -NUMBER OF CITIES AND VILLAGES EMPLOYING SCHOOL NURSES IN EACH YEAR, 1901-1918. Year. Number of cities and villages. 1901 1909 1910.. 101 1 . I I.: 1914 1915 1916 1917 1918 No date given (8) 1 2 5 7 8 9 14 20 29 35 46 54 As Table IX shows, in all cases the paying and supervising agencies are the same. The practice is to have the work directed and paid for by the school authorities. Interest is indicated in the school nursing movement by the activity of several private and endowed societies. TABLE IX— SUPERVISING AND PAYING AGENCY FOR SCHOOL NURSES. Supervising aud paying agency. Number of cities and villages under each agency indicated. School authorities Board of health .\...V....... Board of health and school authorities! \\[[\[[[[]i School and private societies }f' Philanthropic society !!!!!.!!!?" Total 43 2 3 3 3 54 Table X shows that salaries of full-time nurses range in Illinois from $490 in the lowest instance to $1,500 in the highest. More places are paying them at the rate of between $791 and $890 a year than any other amount. The average salary would fall within the group receiv- ing from $891 to $990. ^ ^ 575 TABLE X — YEARLY COMPENSATION OF SCHOOL NURSES. Yearly compensation. Number of cities and villages paying salary indicated. Full-time. Part-time. < 191 to $ 290 1 291 to 390 4 391 to 490 3 491 to 590 2 3 4 9 6 3 3 4 1 8 1 591 1 9 690 691 to 790 791 to 890 891 to 990 991 to 1 ,090 1,091 to 1 ,290 1,291 to 1 ,500 Endowed.. No information . ^ Total . . 43 11 The number of pupils under the supervision of each nurse depends in most instances on the size of the school enrollment, since most com- munities employ but# one nurse. Authorities generally agree that a feasible standard is about 2,000 pupils^° per nurse, but the size of the school system would need to be considered in setting a standard. As Table XI indicates, more cities have between 3,001 and 5,000 pupils per nurse than any other number. TABLE XI— NUMBER OF PUPILS PER NURSE. Pupils per nurse. Number of cities and villages having number indicated. Full-time. Part-time. Less than 500 . 501 to 1,000. 1,001 to 1,500. 1,501 to 2, 000. 2,001 to 2, 500. 2,501 to 3,000. 3,001 to 5,000. 5, 001 and over Total 4 3 1 1 11 In about half of the communities where nurses are employed follow-up work is carried out. This work, though its nature is not specified except in a few instances, generally has to do with advising the mother with regard to defects found in her child, accompanying pupils to places for treatment, securing glasses, etc. In one- third of the communities (18) the nurse visits each room daily; in 8, semi-weekly; in 10, weekly; in "2, monthly; and in 16, the frequency of visits varies. In most instances the general condition of the pupils is noted. Fifteen communities report that the pupils are " Terman, L. M., Report of the School Survey of Denver, Part V, p. 62. 576 examined by the nurses; the things usually looked for are skin dis- eases and pediculosis, contagious diseases, defects of eye, ear, nose and throat, and less frequently, the teeth. Dental climes. — Dr. William Osier, the distinguished English physician, said, "If I were asked to say whether more physical deter- ioration was produced by alcohol or by defective teeth, I should say un- hesitatingly, defective teeth." The fact that only eight school systems have dental clinics and employ dentists regularly — and all these on a part-time basis, excepting Chicago — shows that the State has not yet awakened to a realization of the truth and significance of Dr. Osier's statement. Statistics, which are presented later in this report, show that decayed teeth is the commonest of all physical defects among school children.^^ Moreover, there is probably no defect among school children which causes so much handicap, misery and disease. These consider- ations would suggest the advisability of accelerating the development of dental clinics. Eye clinics. — So far as our information goes, Chicago is the only city maintaining an eye clinic. At least three other cities have made provision for regular ophthalmic services on a part-time basis. Usually the ophthalamic services are given gratis to the pupils. So far as could be learned there are no other 'types of school clinics in operation in the State. Outlays for health work. — That there is wide variation among the different cities in the amount spent per pupil in health supervision is evident from the following table : TABLE XII— TOTAL EXPENDITURE PER PUPIL FOR HEALTH PROMOTION. Expenditure per pupil. Nothing spent f0.006to$0.0.=i .06 to .23 .26 to .45 .46 to .65 .86 to .85 .86 to 1.05 1.06 to 1.25 1.28 to 1.45 1.46 to 1.65 Information incomplete . Cities and villages expending the amount indicated. Total . 25 12 29 15 7 4 2 2 1 3 10 110 The term "expenditure,'' as used above, includes such items as salaries of physicians, dentists, ophthalmologists, and nurses, medical and dental supplies, printing, etc. It does not include capital outlays. The expense of health promotion work mav vary from the slight cost of a certam phase of the work, such as giving sight and hearing tests m one city, to the high cost of more extensive work, such as com- plete physic al examination and the follow-up work of nurses in another " See Table XXIIL 577 city. Since the scope of school health work varies so widely, it is best not to generalize too definitely concerning per pupil costs. The per pupil cost varies from 6 mills in the lowest case, where anything is spent, to $1.65 in the highest. More places are spending from 6 to 25 cents per pupil than any other amount. Out of the 85 communities that report having regular health supervision, 56 expend 45 cents or less per pupil. The best authorities report that the better systems of health supervision in the cities of the United States usually cost from 50 to 75 cents.^^ They add, however, that $1 or more per pupil would be a better standard, and that anything less than 40 cents is almost certain to be inadequate.^^ The percentage of the school budget spent for health supervision varies from 0.01 per cent in the lowest instance, where anything is spent to 5.0 per cent in the highest. More cities are spending between 0.1 and 0.6 per cent than any other amount. In a study of 25 eastern cities. Dr. Eapeer found that on an average 0.9 per cent of the school budget was spent in health promotion.^* This amount the better authorities say is usually too low. How the cities of Illinois compare, in percentage of budget spent, with the 25 eastern cities of Dr. Eapeer's study, as well as with one another, is evident from Table XIII. TABLE] XIII— PERCENTAGE OP SCHOOL BUDGET SPENT IN HEALTH SUPERVISION. Percentage of budget. Cities and villages spending per cent indicated. Nothing spent 25 Less than 0. 1 10 0. 1 to 0. 6 26 0. 7 to 1, 12 16 1. 3 to 1. 8 - - 11 1.9 to 2. 4 * 6 2. 5 to 2. 9 2 3. to 3. 5 2 Information incomplete 12 Total 110 Records. — Table XIV shows that of the 85 communities having school nurses or physicians, 39 keep health records of pupils. There was no way to judge the nature of the records kept, except that several places sent forms which they used. These forms show little or no uni- formity, and it would be utterly impossible to know accurately the health condition in a given community, and in scarcely any case could the nature and the efficiency of the work in one place be compared with that of others. ^ Terman, L. M., Report of the School Survey of Denver, Part V, d. 60. "Ibid., p. 60. " Rapeer, L. W., School Health Administration, p. 81. -37 H I 578 TABLE XIV— CITIES AND VILLAGES KEEPING HEALTH REvJORDS OF PUPILS. Number of cities and villages. Keeping records Not Keeping records — Information incomplete Total 39 66 5 110 Sight and hearing tests. — Since, as Table I has indicated, man}? states require that the sight and hearing of all pupils- be tested, annually, as a rule, it is pertinent to indicate what the schools of Illinois are doing without the stimulus of legislative enactment. This is done in Table XV. The data show that, where the testing is done at all, the most common practice is to do it annually; in about a half dozen cases it is done more often. TABLE XV— CITIES AND VILLAGES TESTING VISION AND HEARING OF Art with certain limitations. Is omitted from this discussion The number of persons insured in February, 1914, was 13,759,400; of this number 9,682,300 were men and 4,077,100 were women. Com- paring the number of insured persons with the estimated population be- tween sixteen and seventy years of age, there appear to have been in i'^ngland approximately 57 per cent of the adult male population insured and 22 per cent of the adult female population insured. The Insurance Fund. It has already been said that the British Insurance Act is a con- tributory scheme. The fund from which benefits are paid is derived from joint contributions of the employers, the insured wage-earners, and the state. The contributions are divided as follows: In the case of the men, the state contributes two-ninths, the employers three-ninths, and the men themselves four-ninths. In the case of the women, the state contributes one-fourth of the sum, and the remainder is divided evenly between the working woman and her employer. The actual contri- butions per week are as follows: 4:d. (8 cents) from the employed man and 3 J. (6 cents) from the employed woman ^^ the employer contributes 'id. (6 cents) in either case; and the state 2d. (4 cents) in either case. The contributions are uniform for all grades of labor with a single exception, which will presently be noted. The employer must pay a contribution even for employees who are themselves exempt from con- tributing. This is done in order that exempt persons may not be specially sought after by employers to the injury of other workers. The German "'^class system'^ of contributions and benefits was rejected on the ground that, if these were varied in accordance with variations in wages, the lower paid wage-earners would receive very inadequate benefits. Mr. Lloyd George, speaking in the House of Commons in 1911, said that he had not adopted the German system because in the lower classes "the benefits are so small that the workmen in Germany say they prefer to resort to parish relief as the benefits are much too inadequate. For that reason we have decided in favor of one class, because if you have a scale which is proportionate * * * ^^ would certainly not give them (the lowest class) a minimum allowance to keep their families from want." (Hansard V. 25, c. 616). Tlie British Insurance System Non-Contributory for Persons Earning Low Wages. From the beginning it was planned to make special provision for those receiving very low wages. When Mr. Lloyd George introduced his bill, he said that the flat-rate contribution would have to be modified for persons earning abnormally low wages. In such cases the contri- bution of the insured person was to be reduced, and the difference was to be paid not by the state but by the employer. In the words of Mr. 'In Ireland the normal weekly contribution from insured men is Zd. (6 cents) a week and from insured women only 2d. (4 cents). This is due to the fact that in Ireland a free state medical service has been provided since the year 1851, and therefore it was not necessary to provide medical benefit under the Act for Irish contributors. There are in Ireland 840 dispensary districts, in each of which there is a "dispensary doctor" who is the local public health officer as well as the salaried public medical attendant. Although the doctor is supposed to attend only "poor persons," as a matter of fact, dispensary tickets are given away freely and are used by the shop-keepers and small farming class as well as by weekly wage- earners. 604 Lloyd George, 'If you make the state pay the difference, then it means that the employers who pay high wages to their workmen will be taxed for the purpose of making up the diminished charge for workmen of other employers who are paying less * * *. We have come to the conclusion that the difference ought to be made up by the employer who profits by cheap labour, and therefore in the lowest case (in the case of 15s. a week and downwards) the employer will pay more * * *. Our scale of deduction for the workmen is a uniform one with the ex- ception of that descending scale when you come to the very lowest wages and where you really cannot expect a man to pay 4:d a week." As a matter of fact, if was finally provided that for those in the very lowest wage class, insurance was to be non-contributory and contributions were to be reduced in other classes as follows: Group 1. Persons over 21 years of age earning not more than Is. 6d. (37 cents) a day. Group 2. Persons over 21 years earning from Is. 7d. (39 cents) to 2s. (49 cents) a day. Group 3. Persons over 21 years earning from 2s. Id. (51 cents) to 2s. 6d. (61 cents) a day. For Group 1, insurance is made non-contributory so far as the wage- earner is concerned. The state contributes an extra weekly penny in such cases, and the employer is made to contribute an additional 3d. for the insurance of adult males and an additional 2d. for the insurance of adult females employed at such low wages. In Group 2, the wage-earner contributes only a penny weekly, the state contributes an extra penny, and the employer's contribution is increased by 2d. (4 cents) a week for men and Id. (2 cents) a week for w^omen employed at these low rates. In Group 3, there is no extra contribution by the state, but the male wage-earners in this class have their contributions decreased by one penny while their employers' contributions are increasing at the same rate. Machinery for Collecting Contributions. The contributions of employers and workmen are collected by means of special insurance stamps, which can be purchased at the post-office. Every employed person, man or woman, is given a card ; and at the end of the week the employer puts on the man's card a 7d. stamp represent- ing the 4d. which he deducts from the man's wages and his own con- tribution of 3d. The Post-Master General turns over the sums col- lected by the sale of insurance stamps to the Central Health Insurance Authority—the Insurance Commissioners. The card is supposed to remain in the hands of the insured person; but a workingman may leave his card with his employer. Employers may arrange with the Com- mission for the quarterly stamping of the cards. At the end of each quarter, members of Approved Societies send their cards to their societies. Each society prepares a quarterly re- turn for the Commission showing the number and value of the contri- butions on the cards for which the society claims credit. The societies are required promptly to furnish memVs with new cards, and the stamped cards, surrendered to the societies, are finally forwarded to the rommiFJ^ion. 605 Benefits. The benefits conferred on insured contributors are as follows: (1) ''Medical 'benefit": medical treatment and attendance including drugs and appliances; (2) '^Sanatorium benefit": care and treatment when suffering from tuberculosis or other diseases for which sanatorium care may be needed; (3) ''Sickness benefit'': the payment of a weekly cash allowance to insured persons when "rendered incapable of work by some specific disease or by bodily or mental disablement." The ordinary benefits payable in case of incapacity for work are 10s. ($2.43) a week for men and 7s. 6d. ($1.83) a week for women. Payments begin on the fourth day after such incapacity and may continue for a period of tAventy-six weeks; (4) "Disablement benefit": a cash payment of 5s. ($1.22) a week for men and women alike, which begins after the twenty- six weeks of sickness benefit have expired and may continue up to the age of seventy years^ when old age pensions are payable; (5) "Maternity ben- efits" : a cash payment of 30s. ($7.50) in case of the confinement of the wife of an insured person or of any woman who is herself an insured person. Medical and sanatorium benefits become available immediately, but full benefits are withheld until a specified number of payments has been made as follows: Sickness benefit is payable after contributors have been insured for 26 weeks and have paid 26 contributions. Maternity benefit, originally deferred for the same period of time, is, by the amending Act of 1918-, payable only to contributors who have been insured for 42 weeks and have paid 42 contributions. Disablement benefit is payable only after 104 weeks of insurance and the payment of 104 weekly contributions. Medical and sanatorium benefits are administered by the Insurance Committees. Sickness, maternity, and disablement benefits are ad- ministered through so-called "Approved Societies." For such benefits Mr. Lloyd George said he believed the old Friendly Societies of Great Britain had "a great tradition behind them and an accumulation of ex- perience which is very valuable when you come to deal with questions like malingering." However, not only Friendly Societies but trade unions, industrial insurance companies, and employers' provident funds may become "Approved Societies." Any surplus funds secured by a society through economical admin- istration may be used for additional benefits; such as, payment of sickness benefits before the fourth day of incapacity, medical attendance on the dependents of a society member, dental treatment, or the pay- ment of a superannuation allowance. Arrears. The English Act is liberal in the matter of arrears, for no contri- butions are required during periods of reported incapacity for work, and benefits are gradually reduced instead of being totally withdrawn when arrears accumulate. The provision of the original Act dealing with arrears proved difficult of administration, and amendments dealing with this subject were passed in 1913 and 1918. The original Act provided that a person could cancel the arrears by paying his own contributions and those of his employer for the missing weeks, but the Amending Act of 1913 made it necessary for him to pay only his own. Under the 1918 amendment the Insurance Commissioners may make regulations providing for the reduction, postponement, or suspen- sion of benefits (except medical or sanatorium benefit which remain available) for persons who are in arrears. But in calculating arrears the Act expressly provides that no account shall be taken of arrears accruing (a) during any period during when the insured person was incapable of work and of which notice was given within a prescribed time; or (b) in the case of an insured woman during two weeks before and four weeks after her confinement. Administration: Insurance Commissions and Committees. Four different Health Insurance Commissions were created for the purposes of separate administration in England, Wales, Scotland, and Ireland; but a Joint Committee exists for the regulation of certain common problems. Local administration is entrusted to local Insur- ance Committees which are organized in each county and county borough and to the health committees of county and borough councils. These committees may have from forty to eighty members, and due provision is made in the Act for the representation of the various interests concerned. Three-fifths of the membership of a local com- mittee are appointed in accordance with regulation made by the Xational Insurance Committee and must "secure representation both of the in- sured persons who are members of Approved Societies and deposit con- tributors ;" one-fifth of the membership is appointed by county or county borough ; two members represent the doctors, and one to three members (depending on the size of the committee) must be doctors; and the re- maining members are appointed by the national commissioners. Local Insurance Committees have the following duties: (1) Ad- ministration of medical benefit for all insured persons; (2) adminis- tration of sanatorium benefit for all insured persons and their depend- ents; (3) administration of sickness, disablement, and maternity benefits for deposit contributors; (4) furnishing reports to the National Insur- ance C^ommissioners; (5) responsibility for dealing with the causes of "excessive sickness" in any locality. Insurance is Carried hy Approved Societies. Insurance is carried through "Approved Societies," and any society may be "approved*' by the insurance commissioners if it satisfies certain conditions, the most important of which are (1) that it must not be a society carried on for profit; and (2) that its affairs must be "subject to the absolute control of its members." All contributions are paid into the Treasury, which in turn credits to each societv the contributions paid in respect to the members of that society. The utilization of the societies in the English scheme was believed to be a necessary expedient in view of their great strength. Mr. Lloyd GOT George estimated'' that between six and seven million people had made some kind of voluntary provision against sickness chiefly through Friendly Societies before the introduction of the compulsory scheme. An account of the organization of Friendly Societies for the purposes of insurance and of the effects of the Act upon the work of the societies will be given at a later point. Deposit Contributors. Approved Societies are entitled to reject any insured person who applies for membership, provided no applicant is rejected solely on the ground of age. The societies also have the right to expel members. Insured persons who are refused admission to any society and insured persons who refuse to join a society become "deposit contributors.'' Their contributions and their employers' contributions are credited to a special fund to be called the post-office fund; and their insurance is said to be carried by the post-office, although as a matter of fact they can hardly be said to be "insured" at all, since they receive in sickness, disablement or maternity benefit only the sums standing to their credit in the post-office fund. They do, however, receive medical benefit and sanatorium benefit. In 1914 there were under half a million deposit contributors. Such are the main provisions of the Act. The remaining portion of this report will deal with Health Insurance in Great Britain as it has actual^ worked out in practice. PART II. HEALTH INSURANCE IN OPERATION. The Act went into operation and the collection of funds began July 15, 1912. Benefits, however, were not to be granted immediately. Insured persons were to become eligible for a sanitoria benefit im- mediately, but the more important medical, maternity, and sickness benefits were not to be available until January 15, 1913, and disable- ment benefit, which only followed sickness benefit, could not begin until July 15, 1914 At the time when the war began, therefore, the Act had been in force only two years, and benefits had been in process of distribution for an even shorter period. It is important to keep this fact in mind, for many of the criticisms directed against the Act are due to con- ditions that inevitably arose in connection with the recent organization of so vast and complicated a piece of social machinery. Necessarily many details of organization were found to be unsatisfactory and changes were inevitable. The war has, of course, caused serious delays in the development of improved methods of administration and in the pro- vision of additional benefits. That the great machine continued to work smoothly throughout the war was e\'idence of the stability of organization that had been achieved in so short a time. * Hansard's Parliamentary Debates. May 4, 1911, col. 610. G08 Brifish Doctors and ihe Health Insurance Act. One of the first great problems that confronted the government after the passage of the Act was the attitude of hostility adopted by the Britisli Medical Association toward the provision for medical benefit. During the two years from 1909 to 1911, when a Health Insurance Bill was known to be in preparation, the British Medical Association had been preparing for a vigorous defense of the interests of the medical profession. In June, 1911, the Association had presented certain demands (called the "six points") that they wished incorporated in the bill. Certain of these demands, especially "free choice of doctor" and administration of medical benefit by insurance committees instead of by Friendly Societies were finally incorporated in the bill. Other dis- puted points (e. g., the question of remuneration) were left to be decided by the administrative authorities. In February, 1912, the British Medical Association again forwarded to the government certain peremptory demands, the most important of which related to the question of medical remuneration. The govern- ment had proposed an annual capitation fee of 4s. 6d. for doctors and l.v. 6d. for drugs and medicine. The Association claimed a minimum capitation fee of 8s. 6d. for doctors not including extras and medicine. In order to determine what was adequate remuneration, it was necessary to ascertain "the amount per head of the population which was ordinarily received by doctors in the course of their private practice." The books of the doctors in five important towns were examined by a committee of which Sir William Plender was chairman. The report, presented to Parliament July 11, 1912, showed that in the areas ex- amined, the annual cost of visits and consultation, taking private and contract practice together, was approximately 4s. 5^. per head of the population for consultation, for visits, and for drugs. Various qualif}^- ing factors were urged by the associated doctors, but the government remained firm in holding the demands of the Association to be unreason- able and impracticable. On July 19, 1912, the British Medical Association broke off all negotiations with the government, and a "doctors' strike" was practicallv on. The strike was ultimately broken by a compromise. On October 23, 1912, the government had announced some proposed grants-in-aid, additional sums which Parliament would provide for medical benefits. This made possible a capitation allowance of 8s. Qd. for drugs and medi- cine; and of this 6s. Gd. was assigned for the payment of doctors on the panel and the remainder for drugs, medicine, and appliances. On November 4, negotiations with the government were again opened by the British Medical Association, in part because of the govern- ment 8 new offer and in part because the doctors saw that their strike was certain to fail. The government had threatened the appointment of a sufficient number of salaried doctors in all districts where the panels were not filled, and these doctors were to be given permission to import a sufficient number of assistants for the local work and would therefore be given a threatened monopoly of local practice in areas where the doctors continued on strike. Doctors steadily joined the pane s ; and by January, 1913, there were nearly 14,000 doctors on the panels, and there were very few districts where panels could not be 609 formed. Thus ended the attempt on the part of the British Medical Association to prevent the Act from coming into force. The number of doctors on the panels has steadily increased, as will be seen from the following figures showing the strength of the English panels as pub- lished in the oificial report on the administration of the Insurance Act for the year preceding the outbreak of the war (1913-1914) :^ strength of panels on January 15, 1913 13,996 Strength of panels on April 14, 1913 15,659 Strength of panels on October 13, 1913 15,870 Strength of panels on May 31, 1914 16,059 The total increase in strength since the commencement of medical benefit is thus over 2,000. The Panel System at Work. Every insurance committee is required to prepare and to publish a list of doctors who have agreed to attend and treat insured persons. Every "duly qualified medical practitioner" has a right to be included in the panel; and every insured person is given a free choice of doctors subject to the consent of the doctor selected. According to the statute, medical benefit is defined as "medical treatment and attendance, in- cluding the provision of proper and. sufficient medicine, and such medi- cal and surgical appliances as may be prescribed by the Insurance Commissioners.'^ The statute provides, however, that "medical benefit shall not in- clude any right to medical treatment or attendance in respect of a confinement." The regulations of the Insurance Commissioners have put still further limitations upon the scope of medical benefit. Oper- ations requiring surgical skill are not required of panel practitioners, and X-ray diagnosis and pathological and bacteriological investigations are also excluded. Dentistry is left over as an additional service to be provided in the future, and the treatment of the eyes and ears is held to be specialist service not required of the panel practitioners. As a matter of fact, therefore, medical benefit has up to the present under the contracts with the doctors been held down to the treatment that does not require the services of a specialist. This is in part the basis of the charge that the British system does not provide proper medical care for insured persons. Mr. Lloyd George, however, had promised the provision of the services of consultative experts and surgeons, and it is reasonable to suppose that the medical service would have been developed to include these services but for the interruption of the war. Certain other criticisms of medical benefit under the British Act should be examined. Two drawbacks to the panel system that were early revealed by the English Act are (1) the uneven distribution of doctors in proportion to the population; and (2) the uneven distri- bution of work among such doctors as there are. An investigation made by the English Fabian Society in 1913-14 called attenion to the fact that in pleasant suburban towns, it was not uncommon to find one doctor for every 500 persons, whereas in the industrial communities there might not be one doctor for every 3,000 people. Further the Fabian report says: ' Great Britain. Report for 191S-U on the Administration of National Health Insurance (Cd. 7496), p. 176. —39 H I 610 "Nor can we say that we have noticed much tendency to this geo- grapliical inequality of service being remedied by 'an inrush of doctors to the slums. There is, in fact, a distinct shortage of doctors, and this is, in itself, militating against the success of the Insurance Scheme." As regards the second point, it has been said that free choice of doctors by the insured population will inevitably lead to uneven lists of patients among the panel practitioners. But the difficulty might, of course, be remedied by limiting the number of insured persons allowed to each panel doctor. This change would probably be opposed by the doctors ; but it appears to be necessary to safeguard the interests of the insured persons, who, according to Mr. Sidney Webb, have as yet shown no capacity for using their privilege of "free choice of doctor'' . intelli- gently. In the words of the Fabian report already referred to, the insured contributors have "simply added their names to the list, how- ever crowded, of the best-known practitioners in their neighborhood. In town after town for which we have the figures, about one-fifth of the doctors on the panel are coping with half of the total of insured persons, whilst four-fifths of the doctors divide among them, in comparatively small numbers, the other half.'' These points are also discussed by the English Health Insurance Commissioners in their official report. They report that "as regards the sufficiency of the number of panel doctors available for the country as a whole, there can be no possible doubt * * *. The average number of insured persons per panel doctor is only about 750, a number for which responsibility can, except under abnormal conditions, be accepted by a single doctor with the greatest ease" (Report for 1913-14, Cd. 7496, par. 469). As to the actual distribution of insured persons among the doctors, the Commissioners say that "it is natural to expect that the forces of competition would result in the existence of lists ahove and below the average in size; and properly so, since it is right that competence and thoroughness in attendance should be recognized and rew^arded by a large practice and corresponding remuneration." The Commissioners make the following further statement as to this situation. "The early circumstances of medical benefit were, however, such as to disturb for the time being the operation of the competitive forces. In some districts doctors delayed coming on the panel at the outset, with the result that many selections were made before the panels were complete, and no opportunity subsequently arose for a change of doctor until the end of the year. Nevertheless, the actual position as it existed prior to the first opportunity for change was far from unsatis- factory. Taking the figures of 100 Insurance Committees of a repre- sentative character, it appeared that at the end of 1913 over 50 per cent of the panel practitioners had 500 or less insured persons on their lists, 70 per cent had 750 or less, 80 per cent had 1,000 or less, 90 per cent had 1,500 or less, while over 96 per cent had no more than 2,000. While the nnmhor of insured persons from whom a panel practitioner can properly accept responsibility will, of course, varv with his personal competence and the extent of his private practice, lists of the size above mentioned could not, save in exceptional circumstances, be deemed 611 excessive; and as regards the isolated instances in which doctors' lists greatly exceed these figures, it i/5 generally the case that the practice is shared with a partner or assistant. There are doubtless cases, how- ever, in which a redistribution of panel patients could be effected with advantage to the patients themselves and the standard of the service afforded. Eeforms in this respect are taking place, and will continue to do so, as the insured population become aware, and avail themselves, of their opportunities of changing their doctors; and the whole question is attracting the careful attention of Insurance Committees and the medical profession locally" (Keport for 1913-14, Cd. 7496, par. 470). It should not be overlooked that the British panel system repre- sents a series of concessions to the doctors and has the advantage of enabling panel doctors to retain their private practice. Some of the difficulties that are encountered under the panel system are due to the attempts that have been made to preserve the conditions of private practice. The relations between the panel doctor and the insured patient remain very much like the old private relations between doctor and patient. It is inevitable therefore, as the Health Commissioners have noted in an official report, that as regards the standard and quality of treatment given this must inevitably vary under a system which admits to the panel all qualified practitioners without selection. There appears to have been singularly little complaint of the relations be- tween panel doctors and their insured patients, and according to the last report issued before the war "complaints are comparatively rare in most districts; while reports from all parts bear witness to an in- creasing spirit of mutual undertsanding.'^ There seems to have been little or no complaint as to the arrange- ments with the druggists or as to the quality of the drugs furnished. It is interesting that a letter from England dated April 5, 1913, published in the Journal of the American Medical Association (Vol. 60, p. 1268), calls attention to the decrease in the sale of nostrums and the simple remedies stored by pharmacists. The decrease was estimated at 20 per cent or more. In some working-class centers the nature of the pharmacy business has almost completely changed. In places where the amount of dispensing had been almost negligible, 60 or 70 perscriptions and even a 100 in some cases are dispensed daily. Finally, as to medical benefit, it should be said that a newly organ- ized service with 16,000 doctors giving service to millions of panel patients cannot work without causing some dissatisfaction to some of the individuals concerned. Moreover, no system can be devised that will serve 14,000,000 people to the entire and continued satisfaction of each. Some of the criticisms of the service given under the medical benefit regulations may well be attributed to this fact. Successes as well as failures of the system should be noted. The Second Annual Report of the Insurance Commissioners contains the following encouraging statement: "The history of medical benefit since the publication of the last Report is a record of continuous improvement in the relations between the medical profession and the authorities administering the x\cts, and of steady progress and cooperation, on the part of all concerned in the work of perfecting the administrative fabric, not only by means of the 612 elimination of defects revealed by experience or unavoidably due to the circ 11 instances attending the inception of the benefit, but also by means of the extension and adaptation of the machinery so as to secure a more complete enforcement of the rights and duties already established" (Heport for 1913-14, Cd. 7496, p. 156). Significant, too, is the further statement by the Commission that "signs are not wanting that definite tendencies .are in operation, origi- nating with the medical profession themselves and fostered by the re- sponsible authorities, to raise the standard of the whole of the industrial practice of the country and to enhance the value of the insured service." Further evidence of the steady progress that has been made toward improving the administration of medical benefit has come more recently from the British Medical Association. This testimony of June 1917, is significant in view of the recalcitrant attitude maintained by the Association toward the Act in its earlier stages. In an Interim Eeport on the "Future of the Insurance Acts," which was based on replies to a questionnaire widely distributed among the Branches and Divisions of the British Medical Association and the local Medical and Panel Com- mittees, the "Insurance Acts Committee" of the Association makes the following statement: "On a subject which five years ago was the most highly controversial that had ever been before the (medical) profession, * * * it is found (i) that many matters which at the beginning of the controversy gave rise to most apprehension have assumed a position of quite minor importance; (ii) that the general system by which the state provides medical advice and treatment under the insurance scheme is in the main approved, and that criticisms have a tendency to concentrate on a com- paratively few points which * * * are, after all, matters of detail which ought to be capable of adjustment; (iii) that there is a large body of opinion in favor of the extension of the health insurance system both to kinds of treatment not at present provided for and classes of persons at present excluded therefrom."* It is of further significance that the results of the questionnaire were said to reveal a remarkable unanimity of opinion among the medi- cal profession supporting this changed point of view toward the insur- ance system. The present attitude of the British Medical Association seems to be one of approval of the insurance system and of fear that the government in pressing forward its plans"^ for school medical services, maternity centers and tuberculosis dispensaries "has resolved to allow the National Insurance scheme to die from inanition, or by gradual undermining in favour of a system of whole time state medical officials.''^ Approved Societies and the Inmrance Act. . Memhership.—Attev the passing of the Insurance Act, the old Friendly Societies and Trade Unions organized state sections of their organizations which became "Approved Societies" under the law. New Approved Societies were formed very hastily, and many of these were for special groups of workers who had in the past failed to join such *BriHah Medical Journah June 23, 1917, Supplement p 687 .. 'Se« letter from the Insurance Acts Committee of the British Medical Associa- tion to National Health Insurance Joint Committee, British Medical Journal, Supple- ment, 1917, p. 101. 613 organizations. But vast numbers of workers who had heretofore been uninsured were drawn into the new organizations formed by the com- meicial insurance companies. The Piudentiai for example, quickly formed six "Prudential Approved Societies/^ which enrolled more than three million members. Similarly the "National Amalgamated Approved Society^' (formed by ten other commercial companies) enrolled over a million and a half members, and smaller companies appear to have foi-med similar "state sections'^ as Approved Societies. This activity of the commercial companies was undoubtedly not forseen by those respon- sible for the Act and appears to be undesirable since they are not really democratically controlled as the Act intended the Approved Societies to be. The following table shows for the United Kingdom the number of members (men and women) of the .different types of Approved Societies as published in the report for 1913-14, the last report issued before the outbreak of the war, when conditions were still normal. Men. Women. Total. Friendly societies with branches Other friendly societies Trade unions Industrial assurance companies and collecting societies. Employers' provident funds Total Deposit contributors. Total insured persons. 2,468,119 2,456,747 1,233,570 3,115,270 87, 238 9,360,944 665, 358 931,719 233,010 2,173,291 23,460 4,026,838 3,133,477 3,388,466 1,466,580 5,288,561 110,698 13,387,782 472,272 13,860,054 Over-insurance. — The National Insurance Act carries a provision against double insurance. No person can become an insured person under the Act, i. e., with contributions from employer and from the state added to his own, in more than one society ; but he may, of course, be a member of several societies independently of the Act. It apnears to be not uncommon for a man to carry insurance through the "state side'' of one society and additional insurance through the private or voluntary side of that or another society. In the old Friendly Societies the great majority of the members (in general about 90 per cent or more) continued their full contribution and were insured both on the "state side'' and the "voluntary side." As a result, insurance for a sum in excess of the normal wage of the person insured is now by no means un- common. An insured person may therefore draw a larger income when he is "on sick benefit" than he earns when at work. Should over-insurance be allowed? In considering this question it must not be forgotten that expenses are greater in time of illness, that special and more expensive food is required, and that more care is needed. Nevertheless, this argument applies only to eases of genuine illness, and the fact remains that a temptation to draw sick benefit unnecessarily may exist in cases where more monev can be drawn in this way than by remaining in work. Administration of Siclcness Benefit. The greatest problem that arose in connection with the adminis- ss8n5[DTS 9AISS80X8 ^Bq; uoT^eSanB aq; sbav ^ijauaq ssanjfois jo uoi;bj^ G14 claims were being made. Early in 1913 it appeared that claims made upon the Approved Societies for sickness benefits were in excess of the estimates made by the government actuaries. In the summer of iai3, therefore, a Departmental Committee on Sickness Benefit Claims wsls appointed in order to determine whether these alleged excessive claims were due to defects in the machinery provided for establishing claims upon the sickness fund, or to "malingering'^ amonff insured persons, or to errors in the acturial estimates. The machinery for establishing sickness benefit claims. — In consid- ering the possibility of defective administrative machinery as an explan- ation of excessive sickness claims, it should be pointed out that although the Approved Societies are obliged to pay claims for sickness benefit as prescribed in the Health Insurance Act, difl;erent societies may adopt different methods for making or proving such claims. Opportunities for differences in policy are especially likely to arise as regards such points as the definition of the term "inability to work ;" the questioning of doctors' certificates of incapacity; the system of visiting the sick in their homes during the period when benefits are being paid; or the dis- cipline imposed on mWbers receiving benefits.^ The meaning of the term "incapacity for work'' is all important in the allocation of benefits. Sickness benefit in the statute is defined as "periodical payments whilst rendered incapable of work by some specific disease or by bodily or mental disablement." This has not been interpreted literally as complete incapacity but merely an incapacity rendering members "unable to follow their ordinary employment." The practice of the societies is to accept medical certificates of incapacity given by panel doctors as the proof of a claim for sickness benefit. A difficult question of policy is met at the point. Shall the officials of an Approved . Society question doctors' certificates? The official report on the Administration of Health Insurance, 1913-14, called attention to the fact that Parliament had virtually placed the safety of the societies at the mercy of the panel doctors, since the expenditure on sickness benefit was dependent on sound certi- fication, and that the doctors had not shown themselves worthy in all cases of the confidence reposed in them. Similarly the Eeport of the Departmental Committee on Sickness Benefit Claims noted that the doctors under the Act adopted a new attitude toward the Friendly Society. "While formerly doctors were ready to look after the funds, they are not now prepared to consider the society at all * * *. With regard to those doctors who are now engaged in this kind of work for the first time, there is reason to believe that with some exceptions they do not correctly apprehend the nature of their task, the value to be placed on their certificates, the relation in which they should stand to the society or their responsibility to the working of the whole machine." . <>n the other liand, the Friendly Societies appear to have changed their earlier policy of cooperation with the doctors in passing on sick- ness claims. In the old days the- officials had followed the practice of notifying d octors of any suspicious behavior on the part of members who • These questions of policy were dealt with at length in the Revort of the De- partmental Committee on Sickness Benefit Claims. (Cd 8396) ^^^""'^ ""^ ^''^ ^^ 615 had been certified as incapable of work ; and there was a constant check on the doctors' reports, and "the intimate knowledge which they had of their fellow-members and their close relations with the doctor enabled them to exercise a very real and effective check on the certificates re- ceived/' Under the National Insurance Act the problem of the societies had grown more difficult, in part because of the increase in the size of their organizations and in part because the new membership was drawn from those large sections of the population who were new to the principle of sickness insurance. The panel doctors and the societies. — Serious difficulty appears to' have been caused by the fact that the large body of certifying doctors had had no experience \vith Friendly Society practice. Under the old system, when the medical man was an officer of the society dealing with patients whose characteristics both he and the officials knew more or less intimately, there was less scope for conflicts of opinion as to certifii- cation than under the new system, when patient, doctor, and official were comparatively ignorant of and out of close relationship with each other. For the new difficulties of certification, the Approved Societies were, however, in large part responsible; the new societies had not adopted and the old societies had often relaxed the policy of questioning the certificates, and without the helpful scrutiny of the officials of the society, the doctor was powerless to certificate and discharge satis- factorily. This may be illustrated by one of the cases brought to the attention of the Departmental Committee on Sickness Benefit Claims : "In this case an insured person who was earning only 225. a week but was insured for 34s., with a previous record of obtaining ten weeks' benefit a year, claimed sickness benefit after preliminary inquiry to satisfy himself that he was in benefit to the full amount. In this case the local secretarv and the sick steward were both satisfied that the man, who beguiled the tedium of his leisure by attending to his pigs, 'did not seem ill in the least,' yet they professed themselves obliged to pay benefit because he produced a certificate from a doctor, who accord- ing to belief entertained by the local secretary, 'gives a certificate to any- one who asks him for one.' Apparently, no attempt was made to com- municate to the doctor the grounds on which the society's suspicions were based." In such cases it is apparent that the doctor and the society are alike at fault. It is clear also that the difficulties are largely due to the fact that the system is new and that the administrative machinery is not yet satisfactorily organized. All that is necessary is that the officials of Friendly Societies revive their old practice of utilizing their knowl- edge of the habits and the behavior of the insured person as evidence which must be taken into consideration along with the medical certificate, if necessary after consultation with the doctor, before a decision is arrived at on the question of paying the claims. Excessive sicJcness claims and the pi'oblem of fraud. — Among the witnesses, medical and others, who testified before the Departmental Committee on Sickness Claims, there was a unanimous agreement that 616 there- was no "appreciable amount of fraud" in claiming sick benefit ; eome testimony was given, however, both by doctors and by representa- tives of Approved Societies showing that without any deliberate fraud there was some evidence of difficulty "in getting an insured person who had once declared on the funds to declare off,"— a kind of unwillingness on the part of insured persons "to bring the period of incapacity to an The desire to claim sickness benefit during convalescence may be a reasonable one, but the Committee found it necessary to emphasize the fact that under the terms of the National Insurance Act, sickness benefit was not properly payable during convalescence, nor was it payable on the ground that a period of rest would be "good for" the insured person. Under the Act, sick benefit can be paid only to meet loss of wages because of incapacity for work owing to sickness or mental or bodily disablement. Some testimony was offered to show that persons were less willing to declare off the sick funds when they had no work to go to. This tendency to use or continue sick benefit as a kind of unemployed benefit had been fostered in the old Friendly Society days, and it was said that "successive generations of society officers have winked at the practice." Excessive sickness claims and the novelty of insurance. — Excessive claims were also said to be due to the novelty of insurance. For large sections of the adult male population and for practically all gainfully employed women, the right to draw "sick pay" in lieu of wages when unable to work was an entirely new experience. In the beginning the situation was not clearly understood, and most of the insured persons knew only that they were making weekly pa3^ments of small amounts in order that they might draw out weekly benefits of large amounts. Tliere was also, said the Committee Eeport, "a certain amount of evi- dence of an int-ention to get the most out of the Act, pointing rather to an overkeenness of business instinct than any attempt at dishonest practices." On the whole therefore, in so far as there were unnecessary claims for sick benefits, the Committee laid the blame chiefly upon faulty ad- ministration. "The claims," it is said, "tend to excess in those cases in which the inexperience of the administrator, or his over-experience in bad methods provide an inefficient machine;" and, further, it is noted that "a laxity on the part of the society leads inevitably to an excess of claims on the part of the insured member." Obviously and fortunately, such administrative faults are remedial, and the most recent official report on the administration of Health Insurance notes an improvement, ♦luring the period 1914-17. During this period the claims for sickness benefit decreased, and wlnle special causes arising out of the war are held to be largely re- sponsible for this decrease nevertheless some part of it is to be attributed to improvements in administration which should be permanent. The statement of the Insurance Commissioners on this point is as follow^s: "While special causes have produced much of the improvement in the claims, it cannot be doubted that administration has also exercised an important influence. There is good reason to think that some part 617 of the high cost of sickness among women in 1913 and 1914 was not normal, but was due to a certain extent to the application of inex- perienced supervision to the claims of a class to whom any sickness in- surance was in the nature of a novelty. Careful management should do much to prevent a recurrence of the high rate of claims which pre- vailed during these years."^ Excessive sickness claims and the actuarial estimates. — Excessive sickness claims might also, of course, be attributed to errors in the actuarial estimates. The Act provides for a fiat-rate of contribution, but the actuarial estimates were based on a general average expectation of sickness for the whole insured population. The actuaries could not, in advance, make proper allowance for the fact that the population was not to be insured as a whole but was to be divided into separate societies in which there would be cases of the segregation of persons who were "bad risks" from the insurance standpoint. As a matter of fact, Ap- proved Societies differ greatly not only in the type of organization adopted but in the character of their membership. The large societies contain fairly representative groups of the whole insured population. Some societies, however, are exclusively made up of women or of men. In other societies the membership is selected on some special basis such as a common occupation, residence in a particular locality, church mem- bership, or the practice of total abstinence. Persons in trades that are hazardous and likely to produce sickness will, if associated in a single society, bring a high sickness rate to that society. It is clear, therefore, that when a society exceeds the actuaries' estimate of the expected sickness rate, this may be due to the fact that the membership contains "an abnormal proportion of lives of a particular type exposed to a sickness risk in excess of the general sickness risk of the whole population." On the whole, it appeared that as regards men and even as regards women, the actuarial provision had been adequate but the sickness claims of married women had been in excess of the actuarial provision. But the experience of different societies ■ inevitably differed and differed widely. In some, the claims greatly exceeded the actuarial estimates, and in others thev were well within the actuarial allowance. These difficulties were inevitable under the democratic British system, which recognized the great insurance organizations that had been built up by the people and gave to the insured free choice of carrier. Did Mr. Lloyd George commit a grave error in utilizing Approved Societies as insurance carriers? Can administration by independent Approved Societies be made sound and efficient? Already steps have been taken to remedy the difficulties caused by the segregation of risks, but the principle is apparently not to be changed. A Departmental Committee on Approved Society Finance and Administration was ap- pointed in January, 1916,^*^ and this Committee emphasized the fact that a flat-rate of contribution under conditions permitting the segre- ' Great Britain. Report on Adtninistration of National Health Insurance, 1914- 17 (Cd. 8890), p. 12. ^'^ Interim Report of the Committee (Cd. 8251), May, 1916; Further Report (Cd. 8396), October. 1916; Final Report (Cd. 8451), December. 1916. 618 gation of insured persons "into societies of distinctive occupational hazard" had certain defects. The Committee recommended, however, that these defects should be remedied not by the abolition of Approved Society Administration but by additional exchequer grants toward a special risks fund. The National Insurance Amendment Act of 1918 has met the situation by the creation, with the aid of special Parlia- mentary grants, of a Central Fund and a Women's Equalization Fund to protect the societies in which an abnormal rate of sickness prevails. Effect of the insurance act on friendly societies. — Will the attempt to administer the Insurance Act injure the Friendly Societies instead of strengthening them, is another question that may be raised in connection with the Approved Society problem. The testimony of work- ing-class leaders seems to be that there is grave danger that the Act may destroy what was most valuable in the old Friendly Societies. Testimony before the Departmental Committee on Sickness Benefit Claims was to the effect that "as the various organizations grew, the intimate personal cooperation on which they were based tended to become weaker.'' It was said that the sentiment on which Friendly Societies were built was a "dying spirit." "There has been a tendency for what was originally the expression of a bond of good fellowship and a desire to help one another to pass to some extent to a matter of mere business. The active members have been fewer in numbers; the social side has not been so prominent as fonnerly." A working-class leader who was a member of the Committee on Sickness Benefit Claims said : ^^The administration of a compulsory state insurance is a burden, and not a help, to Friendly Societies and Trade Unions. The energies of these democratic insti- tutions are strained to the breaking-point and the time of many of their ablest officials is spent on matters foreign to their true aims" (Cd, 7687, p. 85). It is apparently difficult to find a way of preserving local pride and interest with the centralized control and supervision necessary to effi- cient management. Strengthening the central government is likely to destroy local enthusiasms and to produce local ignorance and indiffer- ence, "the decay of local spirit, the carelessness of the individual as regards the prosperity of his society, the dehumanizing of the whole machine." The hreakdomn of democratic control. — ^In the opinion of some working-class representatives the-theory of democratic control upon which the administration of the Act by large numbers of independent Approved Societies was based has broken down. This plan wfes originally adopted in order to meet the wishes of the working classes, but their opinion seems to be that it has not been wholly successful. One of their repre- sentatives said, for example, in testifying before a Parliamentary Com- mittee : "In theory, this plan of administration was excellent. It was hoped by this method to secure democratic self-government by insured persons of insured persons. The funds were to be protected bv identitv of interest and the extension of the old Friendly Society snirit into State Insurance. To secure those advantages a contributorV scheme was reluctantly accepted by a majority of the working-class representatives. 619 For these advantages economy, simplicity, uniformity of management, and the pooling of risks over the whole community were sacrificed."^^ In practice, however, the ideals of democratic government and absolute control by members of their own affairs have frequently been non-existent. In the large industrial insurance companies which hastily secured the membership of more than a third of all insured persons, the members cannot be said to have any effective control over the organi- zation ; and in the old Friendlv Societies the old forms of local self- government seem to have been giving place more and more to centralized systems of eontrol. Eadical changes in administration may yet prove to be necessary. Working-class leaders fear on the one hand the dis- organizing effects of the Act upon the workingmen's societies and resent on the other hand the undemocratic methods of the commercial in- surance companies. The Administration of Sanatoriwm Benefit. Sanatorium benefit is largely a tuberculosis benefit, and on the administrative side, it is a question of cooperation with the local author- ities in providing the necessary dispensaries and sanatoria. A special Departmental Committee on Tuberculosis was appointed in February, 191.2, and the two reports issued (April, 1912, Cd. 6164, and March, 1913, Cd. 6641) recommended the adoption of comprehensive schemes for providing adequate care for the w^iole population through the cooperation of Insurance Committees with the Public Health authori- ties and local government agencies such as the County Councils. The government therefore undertook the making of grants-in-aid not to the Insurance Committees but to the local authorities. That is, in place of a scheme for insured persons and their dependents organized by In- surance Committees and financed out of their income supplemented by contributions from the Exchequer and the rates, the plan came to be, in the words of the Annual Eeport for 1913-14, ^^comprehensive schemes for whole areas organized by the local authority and financed partly out of rates and partly by the aid of contributions from Insurance Com- mittees and the Exchequer. Before the outbreak of the war more than a hundred Councils had submitted to the Local Government Board, schemes looking toward com- prehensive treatment, including the provision of dispensaries, sanatoria, and hospitals, both for insured and uninsured members of the popu- lation. In spite of the delays and interruptions caused by the war, the tuberculosis schemes have been carried forward. The number of tubercu- losis dispensaries had increased, for example, from 255 in June, 1914, to 370 by August, 1917; the number of beds in approved residential institutions had increased, from 9,200 in June, 1914, to 11,700 in Au2^st, 1917. Criticisms of the inadequacy of provision for tuberculosis appear to be very general in spite of the progress that has been made. Indeed, in view of the magnitude of the problem, it could not be expected to be otherwise. The Insurance Acts Committee of the British Medical Asso- " Great Britain. Report of the Departmental Committee on Sickness Benefit Clai7ns (Cd. 7687), p. 83. 620 ciation reported general agreement to the effect "that the public funds provided are not sutticient to enable proper provision to be made lor all tubercular persons needing help to obtain suitable treatment. It is probable that such funds as are available are not always used wisely. * ♦ *. The administration of some Insurance Committees and of some Public Health Authorities in this matter is far less efficient than that of others, and the fact that these two bodies^ have dual and over- lapping powers is inconvenient and undesirable." Further testimony as to the unsatisfactory character of the pro- vision for tuberculosis may be found in the report of a Committee (February, 1017) appointed by the Faculty of Insurance to consider the National Insurance Act. This Committee cordially endorsed the results of the medical, sickness, and maternity benefit but reported as to the sanatorium benefit that the Act had been disappointing; "that the tuberculosis scheme cannot be regarded as a success and that, in all probability much better results would be obtained were the existing system of overlapping control brought to an end and the whole re- sponsibility vested in one public health authority." The Administration of Maternity Benefit. This benefit has been perhaps the most popular feature of the In- surance Act and the one that has presented the fewest problems from the administrative standpoint. The Act originally provided for the payment of a lump sum of 30^. ($7.30) in case of the confinement of the wife of an insured person or a woman who was herself an insured person whether she was married or not. An insured woman was under the original Act also entitled to sickness benefit or disablement benefit after her confinement. A further provision of the Act was that where the husband was an insured person and the maternity benefit was payable in respect of his insurance, the maternity benefit was "the husband^s benefit." The Act did indeed provide for the punishment of the husband if he failed to make provision for his wife's care, but this was like lock- ing the stable after the horse had been stolen. An Amending Act in 1913 made the maternity benefit in every case the "mother's benefit" j)ayable only to the woman herself or to the husband on her order. The provision in the original Act giving a woman who was herself an insured person the right to sickness benefit during' confinement in addition to the husband's maternity benefit when her husband was also an insured person did not work very smoothly. In the actuarial scheme of the Act, an incapacity of four weeks was allowed for, which with the sick benefit for women of 7s. M. a week would have meant a payment of 30». as sick benefit in addition to the 30s. maternitv benefit. Many societies followed the policy of giving an additional 30s. as a lump sum in such cases irrespective of the period during which the insured woman was mcapaciated for work by reason of her confinement, whereas the Act obviously intended this special form of sickness benefit for insured married women to be subject to the same conditions as are attached to sickness benefits generally, viz., a weekly sum payable only so long as the society is satisfied that the woman is actually incapable of work. 621 Since the policies of the different societies varied so much with regard to the payment of the additional 30s., the Amending Act of 1913 provided in place of sick benefit for insured married women an additional maternity benefit of 305. payable without any proof of "incapacity for work" being required. On this basis maternity benefit is being dis- tributed at the rate of. approximately a million pounds annually, 305. going to every mother who has an insured husband and 6O5. to every mother who is herself an insured woman. Until the passage of the Amending Act of 1918 maternity benefit was payable after an insured person had been 26 weeks in insurance and had paid 26 contributions (in the case of voluntary contributors 52 weeks and 52 contributions). The 1918 amendments made maternity benefit pay-able only after a period of 42 weeks' membership and 42 con- tributions (uniform for compulsory and voluntary insured persons). The extension of the period of 26 weeks was found to be necessary in order to prevent " ^constructive' entrance to insurance for the purpose of drawing maternity benefit." It was believed that the addition of 16 weeks and 16 contributions would be "an effective deterrent to a growing tendency to engage in work for a few days in order to secure maternity benefit."'^^ The maternity benefit has been regarded with almost universal approval. Criticisms made by such organizations as the Women's Co- operative Guild and the Fabian Society^^ cover two points. 1. That the scope of the Act is not wide enough and that there are still too manv uninsured mothers. 2. That maternity benefit does not insure adequate attendance at child-birth, with adequate provision for infant care. The proposal has therefore been made both by Mr. Sidney Webb's Fabian Committee of Inquiry and by the Women's Cooperative Guild that the care of both pregnancy and maternity should be taken out of the insurance scheme altogether and given to the local public health authorities assisted by grants-in-aid from the government. The strain on the funds of societies which have women members would be re- moved by this change, and proper care would be given to every mother and child regardless of whether or not either or both parents happen to be insured persons in good standing. This would practically make maternity and infant care a non-contributory form of state aid, and it is probable that such provision will be made under the proposed Minis- try of Health. Attention should, however, be called to the opposition of the British Medical Association to this plan. The Association is not in favor of withdrawing any benefits from the Insurance Act and sub- stituting a system of universal provision under whole time state medical officials.^* " See comments in the Supplement to the British Medical Journal, November 17. 1917. p. 708. " See The New Statesman Special Supplement on the Working of the Insurance Act, March 14, 1914, p. 24. " See extract from letter by Insurance Acts Committee of the British Medical Association to National Health Insurance Joint Committee. British Medical Journal, Supplement, 1917, p. 101. Whatever changes the future may bring as to the. extension of maternity benefit, such assistance as the Insurance Act now provides has been greatly appreciated by those who know conditions of life among working women. E. g.. Miss Margaret Llewelyn Davies, of the Women's Cooperative Guild, wrote recently: "The Maternity and Pregnancy Sickness Benefits of the Insurance Acts are important steps in the direction of the mothers' economic in- dependence. With the advent of a Ministr}^ of Health, in connection with which we hope to see a strong Maternity and Infancy Department, largely staffed by women, an opportunity arises for deciding the relation which Public Health and Insurance should have in provision for maternity * * *. But Maternity Benefit has been an epoch-making reform, not only because it is the recognition by the State of the claims of motherhood, but because it has been made the mother's own property."^ -^ Conclusions. How far has the British Health Insurance experiment succeeded? Much can be said in criticism of various points of administration, and attention is too often concentrated on these controversial points. Mr. Sidney Webb, whose criticisms of the Act have been perhaps too fre- quently quoted in this country, said that he had dealt largely with what he believed to be the defects of the scheme in order that alterations and amendments might be brought under discussion. He was emphatic, however, as to the value of the Act as a whole and said in the opening paragraph of his well-known Fabian report: "We cannot pretend to measure the advantage, to individuals or to the community, of the really gigantic provision thus made for the periods of incapacity — however far short of completeness or perfection the pro- vision may be deemed. However faulty in plan we may consider the scheme to be, and however defective in operation, the allocation of so large a sum as twenty millions [pounds] per annum must necessarily relieve a vast amount of personal suffering and mitigate the dire pov- erty of innumerable families in their hour of need. Moreover, though it is as yet too early to enable any statistical evidence to be obtained, it is scarcely possible to doubt that the results in connection with public healh and infant mortality must be advantageous." The following table summarizes the expenditure of the Approved Societies on Sickness, Maternity, and Disablement Benefits in the United Kingdom from the beginning down to the year 1917. Sickness benefit. Maternity benefit. Disablement benefit. 1913 1014 1915 1916 Total Total. £ 6,554,687 7, 210, 472 6,303,942 5,792,731 25,861,832 £ 1,265,556 1,470,252 1,318,898 1,260,268 192, 180 841,649 1,145,989 £ 7, 820, 243 8,872,904 8,464,489 8,198,988 5,314,974 2,179,818 33,356,624 ^^ Women and the Labour Party (edited by Marion PhiUips), p. 32-33. 623 The expenditure on Sicknes^^, ^laternity, and Disablement Benefits alone during tlie first four years in which the Act Avas in operation reached a total of more than thirty-three million pounds, and this entire sum represents money paid directly into the homes of the workers to relieve and prevent the destitution that would otherwise be caused by illness. It is these benefits which have been in part responsible for the decline of poor relief in various parts of England. It has been said for example of the Liverpool dock-hands that "In 50 per cent of the cases where sickness benefit has been granted^ the home would have been broken up, the furniture sold, and the family engulfed by the workhouse if it were not for the sickness benefit granted by the Act. Generally also, it is said that there is less of what the doctors call "walking sickness'' since the Insurance Act has come into force, and the man who should really be in bed instead of struggling with pain and weakness at his daily task is able to give the doctor a fair chance of making a good job of his case." The Act has been severely criticized by Dr. Brend in his book on Ilealth and the State on the ground that it is a public health measure, that its main object was to improve the health of the working part of the community, and that it must be judged solely by its effect on public health. Aside from the fact that it is much too soon to measure the effect of the Act on public health, these criticisms ignore the purpose of the Act in preventing destitution. The National Health Insurance Act is a public health measure obviously, but it is also, and perhaps primarily, an Act to prevent destitution and pauperism. Mr. Lloyd George, in introducing the bill, said that it was a direct consequence of the Old Age Pensions Act, which had revealed a mass of poverty "too proud to wear the badge of pauperism." As the Old Age Pension Act had been a bill to prevent pauperism among the aged, so the National Health In- surance Act was designed to prevent the pauperism of the sick and to remove the workingman and his family from the poor law during periods of illness. Dr. Brend concludes his chapter on Health Insurance by saying that "in taking a broad view the advantages of the Act must not be minimized. . The weekly payments of sickness benefit have undoubtedly lielped many poor people through a period of distress. Maternity bene- fit has been a substantial benefit to mothers and disablement benefit has constituted a small pension for incapacitated persons." Xevertheless these benefits are held to be negligible by Dr. Brend because he believes that the effect of the Act on the public health during the few years in which it has been in operation "has probably been almost nil/' The medical service is said to be no better than "that which .preceded it, "and the fact that this service is available now to several million people who had not enjoyed the advantage of Friendly Society Medical Service in the past is considered of no importance. The medical service under the panel system has its defects, and some of them have been referred to in this report ; but the Health Commissioners in their Second x\nnual Report stated the case very fairly as to medical benefit with all its drawbacks, when they said : 624 "At the lowest estimate of the position, an enormous number of men and women are now receiving treatment for their ailments who pre- viously were accustomed to go without; while on the other hand, in- sured persons have been enjoying at the hands of the more conscientious and competent doctors, a service of the standard of that accorded to re- munerative patients of the well-to-do classes." Further, the social value of the Act should not be overlooked. On this point we can do no better than quote Miss Mary Macarthur, presi- dent of the largest of the women's trade unions, who said in an official . report : "There can be no two opinions as to the great social value of the Act, in revealing the conditions of the mass of working women, and the effect which their low wages have upon their health — questions which up to now have been almost totally neglected. As has been shown, even doctors in poor practices have been amazed at the amount of unexpected and unrelieved suffering that has been brought to light. The Act has shown the country what poverty means. It has shown that people who are underfed, badly housed, and overworked are seldom in a state of physical efficiency; and has expressed in terms of pounds, shillings and pence the truth, that where an industry pays starvation wages, it does, in literal sober fact, levy a tax upon a community'' (Cd. 7687, p. 86). In conclusion, emphasis must again be laid upon the fact that the Health Insurance Act in Great Britain had been in operation only two years, and that the most important benefits had been administered for only a year and a half, when the war broke out. Inevitably there were many inperfections to remedy and before the necessary changes could be made, the great war began to absorb the resources, the time, and the thought that might otherwise have gone into the business of perfecting the schemes of social reform that had been launched by Mr. Asquith's government. The effect of the war in retarding the development of the Health Insurance Organization has already been referred to. In the budget of 1914, the supplementary estimate contained the following proposed Health Insurance Grants from the National Exchequer: AU S^^P^^ Benefit (Women) (Grant in Aid) £500,000 CII) Medical Referee Consultants, etc ^0 000 (III) Supplementary Medical Service roonn ^}YA Nursing Grants (Grant In Aid) 100 000 (V) Sanatorium Benefit (Grant in Aid) '..'.'.'.'.'.'.'.'.'.'.['.'.['.'.'.'.'.]'. lOo'oOO Owing to the outbreak of the war it was considered inexpedient to proceed with any of these new proposals. It soon became apparent that all the work of the depleted staffs of the National Health Insurance Commission as well as the work of the seriously depleted staffs of the local Insurance Committees and Approved Societies would have to be dovoto^d entirely to the continuance of routine work under the Act. On the whole It IS clear that the war has had a definite effect in retarding !l nn^r^^" . ^^^ t ^^T"""'"' ^^^ '^ '' ^^b' fair that due allowance should be made for the setbacks caused by the war in assessing the re- sults of this great British experiment. 625 SPECIAL REPORT XVI. THE HEALTH INSURANCE MOVE- MENT IN THE UNITED STATES. (By John R. Commons and A. J. AUmeyer.) [Note by the Secretary. — Feeling the need for it the Commission employed Professor John R. Commons to prepare a brief history of the health insurance movement in the United States. He was selected because he is without question the leading authority in this country in the field of labor legislation and adminis- tration. Professor Commons is Professor of Political Economy in the University of Wisconsin, a former president of the American Economic Association, and a member of the first Industrial Commission of Wisconsin. He has been assisted by Mr, Altmeyer, an Associate in the University of Wisconsin, in gathering the data pre- sented in the report which follows.] The term "social insurance" in its widest sense includes all insur- ance, since insurance is but the social distribution of individual loss. But the term as here used applies to those forms of insurance, made more or less universal by governmental compulsion or subsidy which pro- tect the wage-earning class against personal hazards. Social Insurance is universal compulsory insurance of workers' welfare. In Germany, the term first used was Arbeiterversicherung rather than Soziale Ver- sicherung. In this country the first men to write comprehensive treatises on the subject used the term workingmen's insurance. Social insurance at present covers unemployment, accident, sickness, invalidity, old age and death^ or rather survivors' insurance. These different forms shade one into another somewhat. Old age may be con- sidered a form of invalidity and, in fact, is included in Germany with invalidity. Invalidity may be considered extended sickness and, accord- ingly, in England, is included with sickness. Early WHtings on Social Insurance in the United States. The first ^mter in this country who made a comprehensive study of social insurance was John Graham Brooks. His book was published in 1893 as the Fourth Special Report of the Commissioner of Labor.^ It was the result of three years'^ study of social insurance in Germany, made at the request of Carroll D. Wright, then Commissioner of Labor. Dr. Brooks was very favorably impressed with the working of the German system. Hi? conclusions were: "The three branches of the German nationl workmen's insurance — the sickness, accident, invalidity and old age insurance — supplement- ing each other mutually, from a complete organization and have resulted in the formation of a new workingmen's code, which in the inevitable fluctuations of 'modern industrial life, will afford to all those in need of assistance a welcome aid, and in its further development cannot fail iJohn Graham Brooks, Fourth Special Report of the Commissioner of Labor, "Compulsory Insurance in Germany," Washington, 1893. —40 H I 620 to exercise a great and salutary influence in the economical and social conditions of the working people; indeed, on the whole nation." The report by Brooks does not seem to have aroused much interest. The next book on the subject was that of Dr. W. F. Willoughby, published in 1898.2 rjij^-g ^Qj.j, covered the entire social insurance movement in Europe. The author did not unqualifiedly recommend the adoption of the entire program of social insurance for this countr\-. He states, "As regards insurance against sickness, nothing short of absolute necessity would seem to warrant the intervention of the state. The arguments in favor of compulsion are much stronger in the case of insurance against accidents."* Accident Compensation. The first form of social insurance to come into prominence in this country wag accident compensation, generally termed w^orkmen's com- pensation. Willoughby had suggested that this might be made com- pulsory, but Dr. Adna F. Weber of the New York Bureau of Labor was the first to present a detailed study. His report was published in 1899 and seems to have been the first contribution that definitely separated out workmen's accident compensation from other forms of social insur- ance."* Prior to that time agitation had been confined entirely to measures designed to broaden the employer's liability laws. As Wil- loughly remarked in 1898, "The most depressing feature of the situation lies in the fact that the very" principles involved in this gradual evolution from the limited liability of employers to that of the compulsory in- demnification by them of practically all injured employees, are as yet not even comprehended in the United States."^ It was not yet clearly perceived that extension of the law of negli- gence would not avail. Xo analysis of accident statistics had been made in this country to show the large proportion of accidents not due to any one's negligence, either that of the employer, the employee, or a fellow- servant. Even had this been realized, public opinion was not 5^et ready to admit tliat industry, as represented by the employer, must pay, re- gardless of negligence. In 1899 an effort was made in N'ew York to pass a bill based on tlie principle of absolute liability and compensation, but it failed on account of the contemporaneous demand for a more stringent liabilitv law.*' • It is significant that the agitation for workmen's compensation in this country took definite shape immediately after the passage of the British Workmen's Compensation Act of 1897. Undoubtedlv, the move- ment here was stimulated by the passage of that act and"^ subsequent amiMidatory acts, including the Workmen's Compensation Act of 1906. All of tlie British acts provided for compensation to be paid largelv with- out ro.irard to individual responsibility. l^llr f- willoughby. Workingmbn's Insurance, 1898 • Ibid., p. 344, . ' pp. 55^7-1162''*'"''* ^""""^ Report of Bureau of Labor Statistics of New York, 1899. ly^i- ^- WniouKhby, Workingmeti's Insurance, 1898, p. 329. Charles R. Henderson, Industrial Insurance in the United States, 1909, p. 144, 627 The cnide, inadequate and unworkable law of Maryland in 1902 marks the beginning of workmen's compensation legislation in this country."^ The Federal Workmen's Compensation Act of 1908 was the first workable compensation act, inadequate though it was. In 1909 the states began to appoint special legislative commissions to study the problem. The report of these commissions, together with the report of the United States Bureau of Labor in 1909, furnished an abundance of information.® In 1910 bath Montana and N'ew York passed acts which were later declared unconstitutional. The year 1911 marks the date of the first permanent state laws. In this year the following ten states in the order named passed compensation laws; Washington, Kansas, Nevada, New Jersey, California, New Hamphire, Wisconsin, Illinois, Ohio and Massa- chusetts. To-da}' there are thirty-seven states and three territories with such laws.^ Dr. Weber in 1902^° and Professor Seager in 1910^^ both ventured the opinion that the English system of workmen's compensation, wherein the employer is permitted to select his insurance carrier, rather than the German system of compulsor}^ insurance in mutual societies, was best suited to conditions in this country. Their opinions seem to have gauged the American attitude correctly, since in thirty of the states the employer is given an option as to the method of insuring his risk^^ and in twenty- eight states self-insurance is permitted.^^ Occupational Diseases. While the states were still in the process of passing compensation acts covering accidents, agitation was begun to include occupational dis- eases. Possibly the fact that certain occupational diseases were covered in the British Compensation Act of 1906 may have had some influence on this discussion. In 1910, Dr. John B. Andrews, Secretary of the American Association for Labor Legislation, said: "No intelligent per- son can go far in the study of compensation for industrial accidents without realizing that a logical consideration of the facts must lead to compensation for industrial diseases."^* The logic of providing compensation for occupational diseases is apparent from the definition, "Occupational diseases are morbid results of occupational activity traceable to specific causes or labor conditions, and followed by more or less extended incapacity for work."^^ The great obstacle to legislation along this line is the difficulty of administration. In some states the word "injury" in workmen's compensation acts has been construed bv the commissions and courts to include diseases. This is so in the case of Massachusetts and the Federal Government. In ''U. S. Bureau of Laboi' Statistics, Bulletin No. 240, "Comparison of Work- men's Compensation Laws of the United States," 1918, p. 10. * Twenty-fourth Annual Report, U. S. Comimssioner of Labor, 1909, 2 vol. »U. S. Bureau of Labor Statistics, Bullp:tin No. 240, 1918, p. 9. ^" Employer's Liability and Accident Insurance, Political Science Quarterly , Vol. XVII, 1902, p. 282. "Henry R. Seager, Social Insurance, 1910, pp. 74-75. "U. S. Bureau of Labor Statistics, Bulletin 240, 1918, p. 15. "Ibid., p. 40. "^^ Bulletin on Industrial Diseases and Occupational Staiidards, May, 1910. ^^ American Labor Legislation Review, Vol. 1, No. 1, January, 1911, pp. 125-143, Memorial on Occupational Diseases. 628 California and Hawaii the inclusion of occupational diseases has been brought about by statutory enactments." No state has followed the British plan of providing a definite schedule of compensatable occu- pational diseases. This method is considered by the Committee on Occupational Diseases of the :N'ational Conference of Commissions on Uniform State Laws as "the only practicable way of dealing with the matter."^^ The British Act of 1906 covered six occupational diseases, which number has since been increased to twenty-eight. Only .the most appar- ent occupational diseases can be included (such as anthrax, lead poison- ing, glass blower's cataract) and even then the responsibility is often htSd to fix. When the onset of the disease is gradual, as in the case of lead poisoning, it is hard to determine which employer is responsible, if the workman has been employed by more than one. If it is difficult to fix the responsibility in the case of those diseases to which the public at large is not subject, it is practically impossible to do so in the case of "diseases to which the public is subject, but which" mav be caused or aggravated or accelerated by specific conditions of labor."" Undoubtedly, workers in the so-called "dusty trades" have an ex- cessively high death rate from tuberculosis, but it is impossible to establish the causal connection in individual cases. It is also true that monotony of work, speeding-up, a long work day, and inadequate wages undermine one's health and resisting power, but these facts could hardly be made the basis for legal action. A way out of the difficulty, which has been proposed, is to make industry responsible for all occupational diseases, the causes of which can be definitely allocated, and to provide compulsory contributory health insurance for all employees. Health insurance would then take care of occupational diseases not compensated. Advocates of compulsory health insurance point out that in the two states where occupational diseases are covered by the workmen's com- pensation law, the number of cases for which compensation is allowed is negligible.^® While compulsory health insurance may be regarded as a logical development of accident compensation, it is more than an extension. Underlying both accident compensation and compulsory health insurance is the theory of social solidarity. In accident compensation the purpose was to make industry bear the cost of the damage and destruction of the ««• ®' ^"reau of Labor. Bulletin 240, 1918. p. 45. " Proceedings of the Twenty-seventh Annual Meeting of the National Conference of Commissloner.«j on Uniform State Laws. " See classification of the Committee on Occupational Diseases, whose report na.«>i been referred to above. T ^ "^.^'i A^'^'^P'^'i" Massachusetts, of 135,257 personal injuries reported to the Indv - Accident Board in the year 1915-16, onlv 2029, or 1.5 per cent, were cases or ' tlonal di.sease. (Annual Report of the Massachusetts Industrial Accident Board, July 1. 1915 to Juno 30. 1916, p. 70) In California, in 1915, 67,538 injuries were reported to the Industrial Accident Commission, but from the time the law requiring' the reporting of occupational diseases went into effect, August 8, 1915, K^'iVo»-A' ^^^®' °^^Y. *^\ ^'seases were reported. It was thought that these might «««« h^^*l.^® ^*^«"P*^V**"i^^ diseases, although at the time of the report the Commis- si J^c^? not definitely decided. (Report of the Industrial Accident Commission of the State of California from July 1, 1915, to June 30, 1916, pp. 42 and 43.) 629 human factor as it already did for machinery. Sickness, however, may exist entirely apart from industry The American Association for Labor Legislation. It is interesting to observe that agitation for health insurance began in this country in 1912, soon after the passage of the British National Insurance Act of 1911, just as agitation for accident compensation began soon after the passage of the British Workmen's Compensation Act of 1897. The first attempt to formulate a plan of compulsory health insur- ance adaptable to conditions in the United States was that of the American. Association for Labor Legislation m 1912. This association is a branch of the International Association for Labor Legislation, whose headquarters are at Basle, Switzerland. The International Asso- ciation, which is a federation of associations in fifteen different countries, was founded at Paris in 1900, to promote progressive industrial legis- lation in all nations and an international knowledge of labor laws. Prior to the world w^ar the International Association received subventions from twenty-two national governments, including a contribution on account of services from the United States Department of Labor. Its publi- cations are issued in the three languages, English, French and German. The American Association was founded in 1906 and affiliated with the International Association. Its objects were to sen^e as a branch of the latter, to promote uniformity in labor legislation among the several states, and to encourage the study of labor legislation.^*^ Health insurance is but one of the several activities of this association, other activities being legislation for protection against accidents and disease, the taxation of poisonous phosphorus matches out of existence, the pro- motion of the Federal Compensation Law, as well as workman^s com- pensation laws in various states, accident reporting and legislation to secure better administration of labor laws. In December 1912, the Association created its first national com- mittee on social insurance, which organized the First National Con- ference on Social Insurance, held in Chicago in June 1913. After extensive investigation and a number of meetings^ the Social Insurance Committee in the summer of 1914 issued a tentative statement of the essential lines it would follow in the drafting of a sickness insurance bill. Finally, in November 1915, with the cooperation of a committee of the American Medical Association, the first tentative draft of an act for health insurance was published. A few months later the measure was introduced in the legislatures of New York, Massachusetts and New *<*The President of the American Association for 1918 is Samuel McCune Lind- say. The Secretary is John B. Andrews of New York. The Executive Committee, which is representative of its membership composed of labor leaders, employers and scientific men, consists of : T. L. Chadbourne, Jr., lawyer. New York City ; Henry W. Farnam and Irving Fisher of Yale University ; Edmund N. Huyck, manufacturer, Albany, New York ; V. Everit Macy, capitalist, New York City ; Royal Meeker, Chief of the United States Bureau of Labor Statistics, Washington ; John Mitchell, former president of the United Mine Workers of America, Mount Vernon, New York ; Margaret Dreier Robins, president of the National Women's Trade Union League of America, Chicago; John A. Voll, president of the Glass Bottle Blowers' Association of the United States and Canada, Philadelphia. 630 Jersey.-^ This bill has come to be known as the "Standard_Bill" and will be discussed later." Jnvestigaiing Commissions. While in 1915 there were three legislatures in which the standard bill was introduced, there were, in 1917, twelve state legislatures that considered health insurance bills. Altogether, the legislatures of eight states have appointed commissions which have investigated the subject. The first commission to report was that of California., appointed in May 1915. While it was authorized to make a study of social insurance, it concentrated on health insurance. _The Commission, in its report to the legislature January 1917, was unanimous in favoring compulsory health insurance. The second commission to report was that of Massachusetts, created in 1916. This commission investigated sickness, unemployment, old age and hours of labor. Its report, submitted in February, 1917, endorsed the principle of health insurance unanimously. Five of the members favored the immediate adoption of compulsory health insur- ance of the type usually proposed. Two felt that there should be more investigation, while two more felt that if a compulsory system were adopted, the employee should not be required to contribute. New Jersey had appointed a Commission in 1911 to invesigate old age insurance. This Commission submitted a report in November 1917, stating its belief that "health protection should precede any pro- vision for old age.-^ It, therefore, recommended the adoption of a health insurance measure, presumably compulsory. The Commission felt that the need for such a measure was especially great at that time, because of the war situation. Meanwhile, Massachusetts had created another Commission to concentrate, this time, on health insurance. This second Commission reported January 15, 1918. Nine members voted against compulsory health insurance and two voted in favor of compulsory health insur- ance with no contributions from the employee. From a perusal of the report it would seem that the Commission was concerned particularly with the problem of ascertaining the attitude of different interests. The report states that "an analysis of the evidence reveals no growing demand in the Commonwealth for compulsory contributory health legislation." At present, January, 1919, there are six Commissions still at work -which will report at the next meeting of the legislatures. They are: California (reappointed), Connecticut, Illinois, Ohio, Pennsylvania, and Wisconsin. The house committee authorized in New Hampshire has "John B. Andrews: Address before Twelfth Annual Meeting of the National Association for the Study of the Prevention of Tuberculosis, Mav, 1916, » The members of the Committee on Social Insurance that drafted this bill were : Miles M. Dawson. Consulting Actuary ; Edward T. Devine Director New York School of Philanthropy; Carroll W. Doten, Secretary of the American Statis- tical Association ; S. S. Goldwater, formerly Commissioner, Department of Health, City of New York ; Henry J. Harris, Chief, Division of- Documents, Library of Congress; Alexander Lambert, Chairman of Social Insurance Committee, American Medical Association; I. M Rubinow. Actuary and Statistician; Henry R. Seager. Professor of Economics, Columbia University; Lillian D. Wald, Head Resident, Henry Street Settlement : John B. Andrews. Secretary, American Association for Labor Legislation. "Report on Health Insurance by the New Jersey Commission, 1917, p. 4. 031 not* been appointed. These C^ommissions have held two national con- ferences, one in December 1917 at Philadelphia and one in May, 1918, at Cleveland, to discuss problems and methods.^* It would seem that we have reached the same stage in health, in- surance legislation as was reached in accident compensation legislation nine years ago ; the period of legislative investigating Commissions. As yet no bill providing for compulsory health insurance has been passed. Basis of Agitation for Compulsory Health Insurance. It is not intended here to discuss the merits of the proposals for compulsory health insurance, but in order that the attitude of the differ- ent interests may be proper h^ understood, it seems advisable to state briefly the main arguments which have been advanced pro and con. Underlying the agitation for compulsory health insurance is the belief that there exists an excessive amount of sickness; that such sick- ness is one of the principal causes of poverty ; and that existing agencies are inadequate either to prevent or distribute equitably the cost of such sickness. As evidence of the amount of sickness or disability prevalent, the Report of the Provost Marshal General on the First Draft under the Selective Service Act in 1917, is cited. From this report, (pp. 44, 45) it is estimated that about 35 per,cent of those registered were rejected, as physically disqualiSed for service. The investigation made for the Federal Commission on Industrial Eelations by Dr. B. S. Warren and Edgar Sydenstricker, regarding industrial conditions and the public health, led to the conclusions that, among the thirty-odd million wage- earners in the United States, there is an average of nine days a year lost through sickness, a total wage loss of $500,000,000, and a medical cost of $180,000,000.25 Responsibility \''>v -ickric— i- -vnerally attributed to three factors. The industry is held responsible for a certain portion, as indicated by the varying rates of morbidity and mortality for different occupations. The health hazard of some occupations (judging from the rate of in- surance companies) is double that of the least hazardous occupation. The community is held responsible for the portion of sickness due to conditions under its control, such as housing, food, water supply, sewage disposal, and the community enviornment in general. Such diseases as typhoid, scarlet fever, diptheria and other epidemic diseases are clearly susceptible to community control. But it is impossible to go into a man's house and force him to observe the rules of personal h3'giene, so that the individual is responsi- ble for that portion of sickness due to failure to observe the rules of right living. Because of the joint responsibility of these three factors, all three are assessed, in most of the schemes proposed, a portion of the cost of compulsory health insurance. The partnership of disease and poverty is considered by the ad- vocates of compulsory insurance as a matter of common observation and 2* Reports of these conferences are contained in Vol. VIII, 1918, Nos. 1 and 2 of the A^nerican Labor Legislation Review. ^ Final report of the Commission on Industrial Relations, 1915, p. 202. N 632 the studies of infant mortality made by the Children's Bureau are pointed to as showing that the rate of infant mortality varies inversely with the family income. Likewise it is argued that the extra expense and the loss of wages caused by sickness often wipe out any surplus in the family budget and force the afflicted family on charity. Devine states that of the destitute families coming under the care of the Charity Organi- zation Society in New York City, three fourths were found to be desti- tute wholly or partly on account of sickness.^^ It is asserted that those who are sick, being unable to afford it, do not receive adequate medical attention. The Health Survey made by the City Club of Milwakee states that 40,000 persons were sick at the time of the survey. Of these, 25,700 or 64.7 per cent would have been entitled to medical care under a compulsory health insurance bill such as the one introduced in New York and Massachusetts. Of those who would have been entitled to medical aid, only 11,000 were under a doctor's care. On the other hand, the sickness surveys of the Metro- politan Life Insurance Company do not show a large percentage of those sick without medical care. Their percentage of cases of sickness with- out medical attendance range from 24.2 per cent in Pittsburgh to 39 per cent in Rochester, N. Y.^^ It is contended by many who favor compulsory health insurance that contributions by the three factors responsible will distribute the burden equitably. It is claimed that the one who is sick will then be assured adequate medical attention and the family's income will not entirely cease, by reason of cash benefits to be provided. Advocates of compulsory health insurance believe that existing voluntary insurance carriers cannot take care of the problem, because not enough people are insured and those who are insured as a rule carry only enough insurance to provide funeral expenses. Studies made of family budgets show that a majority of families carry insurrance of some sort. Chapin found, however, that the insurance was "not a pro- vision for a rainy day, but a provision for meeting a single contingent expense; viz. the cost of burying the dead."^^ Mrs. More found that "the insurance invariably goes to meet the expenses of the funeral or of the last illness."^^ It is also contended that the cost of voluntarv insurance is excessive, especially in the case of industrial insurance. The assertion is made regarding industrial accident and health insurance that only about one- third^° or two-fifths of the premiums are returned in the form of bene- fits to the insured. The excessive cost is considered inevitable because of the necessity of loading premiums to cover the necessary expense of secur- ing and conducting the business. With wholesale compulsory health in- surance, it is believed that competitive and retail costs will be eliminated. "E. T. Devine, Misery and Its Causes, 1910, p. 54. "See pamphlets issued by Metropolitan Insurance Company, covering sickness surveys of I^'ttsburgh. Penn. ; Principal cities in Pennsylvania and West Virginia ; Chelsea Neighborhood, N. Y. City : and Kansas City, Mo. ; also reprints published by the U. S. Public Health Service of sickness surveys of North Carolina and Rochester. N. Y., made by officers of the same company. "R C. Chnpln. The Standard of Living in New York City, 1909, p. 192. ••I.oulse B. More. Wagc-carncrs' Budgets, 1907, p 43 •"I. M. Rublnow, Social Insurance, 1913, p. 296 633 Another advantage claimed for compulsory health insurance is that it will have a preventive effect. It is stated that, just as the number of accidents was reduced when workmen's compensation laws went into effect, so will the amount of sickness be reduced when the employer and employee see that it pays to take precautions against sickness. XJie co,si_QJL healt h insurance is generally estimated as a percentage jd the pa3Toll. The estimate usually given is 4 per cent. This cost varies directly with the benefits provided. Advocates of compulsory health insurance point out, however, that the costs are only made visible and distributed equitably. They contend that a rational method of carrier does not increase the cost, but may lighten it, as has been the case with workmen's compensation. Doctors have been paying in the form of charity work; emploj^ers because of decreased output, due to worry and neglected cases of sickness among the employees ; employees through reduced earning power ; and the whole community through contributions to charity and in increased amount of sickness. Arguments Agcdnst Compulsory Health Insurance. The opponents of health insurance assert that the mortality and morbidity experience of this country is more favorable than that of Germany, the first country to adopt compulsory health insurance. "Thus, for Boston, Mass., the average sickness loss for males is only 6.3 days per annum, and for Rochester, N. Y. the loss is 7.0 days, against more than 9.2 days for Germany and 9.5 for Austria."^^ It is also claimed that the mortality experience among the industrial popu- lation is as favorable as that of the population at large.^^ The increase in the amount of savings banks' deposits is ojffered as proof that wage-earners' budgets are sufficient to provide for proper care and needs of dependents. Existing insurance agencies are considered adequate and more effi- cient than a state owned or controlled system. These voluntary agencies are believed to encourage thrift and foster independence. It is also contended that prevention is not the function of insurance. Therefore, it is urged that public health administration and preventive medicine be developed instead. As positive objections to compulsory health insurance it is claimed that such a system is not in accord with our theory of government ; that it is Prussianistic, Socialistic or paternalistic in its nature; that it restricts personal liberty. It is also alleged that the moral effect on the workman will be bad and that it will lead to malingering. Finally it is urged that the status of the medical profession will be lowered, because of overwork, burdensome details, suppression of initiative on the part of physicians, and insufficient remuneration. The following specific counter-suggestions have been made: 1. Development of state medical care to provide care for all. 2. Development of public health agencies. 3. Education in personal and public hygiene. »* Frederick L. Hoffman, Facts and Fallacies of Compulsory Health Insurance, Prudential Press, 1917, p. 89. 32 Magnus W. Alexander, "Some Vital Facts and Considerations in Respect to Compulsory Health Insurance," Bulletin, March, 1917, p. 7. 634 4. Development of institutional and group facilities for the treat- ment of disease: hospitals, dispensaries, diagnostic stations. 5. Compensation for occupational diseases. 6. Development of voluntary insurance carriers. 7. Development of institutions to encourage thrift. 8. Shorter hours, better pay and better conditions for labor. The Standa/rd Bill. The Standard Bill of the American Association for Labor Legis- lation, as published June 1916, covers all manual employees and all other employees receiving less than $1,200 per annum. Home-workers and casual workers may be included by administrative order. It pro- vides benefits for all sickness, accidents, and death not covered by work- men's compensation. The cash benefits are &&% per cent of the wages for a period not to exceed 2& weeks in any consecutive twelve months. The medical benefits consist of medical, surgical and nursing assistance and treat- ment; medicines and therapeutic appliances costing not more than $50 in any one year; hospital care; medical and surgical treatment and medicines to dependents. Maternity benefits are provided for insured women and the wives of insured men, consisting of cash and medical benefits to the former and medical benefits to the latter. If the hospital care is given the insured, the cash benefits are re- duced to one-third of the wages. Funeral benefits up to $50 are allowed. Employers are obliged to contribute 2/5, employees 2/5 and the state 1/5 of the expenses. If the earnings of the insured are less than $9 a week, his contribution is reduced. Employees earning less than $5 a week contribute nothing. In such cases the employer makes up the difference. ' The bill provides for the organization of local funds. In cities where there is a large enough number of employees in a trade, trade funds are to be organized. Each of these funds is to be managed by a committee composed of representatives of employers and employees. This committee in turn elects a representative board of directors to carry out its policies. Xon-profit making insurance carriers, such as fraternals, labor unions and establishment funds may come into the system under rather discouraging conditions. The employer's contribution except in the case of establishment funds must be paid into a state guaranty fund, instead of to the society. If the operation of such a society endangers the existence of a local or trade fund, it may be compelled to discon- Tinup. Commercial insurance companies are excluded entirely. The medical service, to be provided may be along either of the fol- lowing lines: 1. A panel of physicians to which all legally qualified physicians may belong, with freedom of choice of physician on the part of the insured. The number of persons on the list of any one physician may not exceed 1,000. ^ r . 635 2. Salaried physicians lu the emplo}' of the carriers, with reasonable free choice of physician by insured. 3. District medical officers engaged for the treatment of insured persons in prescribed area^. 4. A combination of above methods. The method of^ compensation for medical service is not prescribed. Medical officers must be employed by the carriers to certify to claims and to supervise the character of the medical service. _ Arbitration com- mittees, both state and local, to be composed of the various interests, are provided to adjust disputes between the insured and the physician or between the fund and the physicians. There is to be a Social Insurance Commission, one member of which shall be a physician, to carry out the provision of the act. This Com- mission is to be advised by a Social Insurance Council, consisting of employers and employees. A Medical Advisory Board, chosen by the state medical societies, is to be consulted on medical matters and is to have the right to review disputes regarding medical matters which have been appealed to the Commisson.^^ The above bill is termed a "tentative draft" and has been modi- fied in some respects. The bill as submitted to the Conference on Social Insurance, December 1916, was more specific.^* The medical organi- zation is much more complete, _due_to the cooperation of the Social In- surance Committee of the American Medical Association.- In addition to the local arbitration committees, there are created Local Medical Committees, elected by the physicians. "To this com- mittee come all the disputes in regard to medical benefit or any charge made a^inst a physician because of his work, before it is sent on to the board of directors of the fund."^^ Public health officials are given a place both on the Local Medical Committee and on the State Medical Advisory Board, so that the neces- sity for sanitation and preventive medicine may not be lost sight of. A State Nurses' Advisorv Board is also added. In all, the American Association for Labor Legislation has pub- lished in 1915 and 1916 three successive drafts of the Standard Bill, and as a result of further suggestions and deliberations by its Com- mittee on Social Insurance, has adopted in lieu of a fourth tentative draft, the provisions- of the Nicoll Bill introduced in the l^ew York Legislature in 1918 and discussed below. Other Proposals. The California Commission, while it approved of the principle of compulsory health insurance, rejected two of the items in the plan of the American x\ssociation for Labor Legislation. The Commission be- lieved that only insurance for medical benefits should be in a prescribed carrier and that the cash benefits should be furnished by voluntary insurance carriers. It also disapproved of placing the administration 33 For more detailed information, see The American Labor Legislation Review, Vol. VI, No. 2. 3*U. S. Bureau of Labor Statistics, Bulletin 212, 1917, p. 663. 35 Ibid., p. 647. 636 80 largely in the hands of local committees, composed of employers and employees, believing that there would be too much friction and that there could be no assurance that the local officials possessed the neces- sary ability. The Commission would still have state and local advisory boards, to allow for representation of interests. The administration, however, would be centralized in the State Commission created to carry out the provisions of the law. Under the California plan, a state fund would be established, which would be practically the only carrier providing medical benefits, only trade and establishment funds being allowed to carry their own medical benefits. This fund would also provide cash benefits to those who cared to insure in it rather than in a voluntary association. Under this plan, the entire contribution to the state fund would be borne by the employers and the state. The medical organization under this scheme would consist of local panels, including all licensed physicians, under the supervision of district medical inspectors. The Nicoll Bill, introduced in the N^ew York legislature in Febru- ary, 1918, has been endorsed and widely distributed by the American Association for Labor Legislation in lieu of a forth edition of its tenta- tive draft of a Standard Bill.This bill differs in some important particu- lars from the draft of the Standard Bill discussed above.This bill, which is fostered by the New York State Federation of Labor, excludes volun- tary insurance carriers (except establishment funds) from the system. This was not because the Federation was opposed to voluntary, insurance carriers, but because it believed that the system would operate more ouccessfully, if these societies were allowed to supplement the compul- sory system in furnishing additional benefits over and above those allowed under the compulsory system.^^ The Committee on Health appointed by the New York State Federation felt that it would be difficult for the fraternal associations and trade unions to rearrange their rates so as to provide the benefits required by the act. Consequently, they introduced the important modification of a very low cash benefit to be paid under the compulsory scheme, so that opportunity might be left for fraternals and trade unions to furnish mainly the cash benefits, leaving the medical and hospital treatment to the compulsory system. Under this proposed arrangement, the functions of fraternals and trade unions would be the _^ ••Pamphlet, Official Endorsement of New York State Federation of Labor, 1918. The Committee on Health to date has issued five reports : the one just referred to ; a second, Diacuaaion of Bill Endorsed by New York State Federation of Labor; a third, Advantagea to Industry; a fourth, A Demand for the Passage of a Health Insurance Law ; a fifth. Progress Toward Health Insurance Legislation. The mem- bers of this committee are: James M. Lynch, formerly President of the Internat- ional Typographical Union and now chairman of the Industrial Commission of New York ; William Rander. organizer for the Brotherhood of Painters and Decorators ; '^?^Ji ^^^ ^^I'^'ll*?"' '"^^J",^^ of the Troy Typographical Union ; Charles H. Stevens ^J^^ Buffalo Cigar Makers; Richard H. Curran of the Rochester Holders; Nellie Kelly of the United Qament Workers; Rose Schneiderman of the Women's Trade Union League ; James P. Boyle of the- Brooklyn Bookkeepers', Stenographers' and Accountants Union; and Roswell D. Tompkins, secretary of the New York United Board of Business Agrents. 637 providing of additional cash benefits, while the compulsory scheme would provide the minimum medical and cash benefits. In the Nicoll Bill, the insurance is made compulsory for all em- ployees, the cash contribution by the state is eliminated, and the con- tribution by the employer and the employee are made equal. The decision to eliminate the contribution by the state is interesting, be- cause some labor organizations object to any contribution on the part of the employee. Of twenty-two labor representatives who testified before the Massachusetts Commission on Social Insurance, which reported January 15, 1918, all were in favor of some form of health insurance, but only one cared to go on record as favoring a contributory plan. The State Federation of Massachusetts also declared for a non-contributory system. Attitude of Organized Labor. It will be seen that the Xew York State Federation of Labor has taken a definitely aggressive position in favor of a plan of compulsory health insurance, drafted bv its own committee as a modification of the "Standard Bill.^' Outside New York, organized Labor has not studied the subject long enough to have committed itself definitely either for or against compulsory health insurance. The official attitude of individual unions, as expressed in the form of resolutions, sometimes depends upon the opinion of whoever happened to present the resolution. Not being immediately concerned with the subject, the resolution may be passed without close scrutiny. A case in point is that of the International Typographical Union. At its Scranton metting, in August 1918, two conflicting resolutions were introduced. The first resolution favored the inclusion of occupational diseases in workmen^s compensation laws (proposition 72) but was opposed to health insurance, saying: "* * * the system of health insurance is advocated mainly by socialists and theorists, who, for the most part are not affiliated with the labor movement.'^ The second resolution favoring health insurance (proposition 118) was adopted later in the session and carried this clause : "Resolved, That the Scranton Convention of the International Typo- graphical Union herewith endorse health insurance for wage-earners and their dependents, with equal contributions from employers and employees, the funds democratically administered." The Executive Council of tlie American Federation of Labor has been distinctly opposed to compulsory health insurance, but has favored investigation of its merits.^^ This appears from the annual reports made by the Council to the Annual Conventions of the Federation. In 1915, the report contained the following clause :^^ 3^ The Executive Council is elected at the Annual Conventions of the American Federation of Labor, and, for the year 1917-18, was composed as follows: Samuel Gompers, James Duncan, James O'Connell, Jos. F. Valentine, John R. Alpine, H. P. Perham, Frank Duffy, William Green, W. D. Mahon, Daniel J. Tobin, Frank Mor- rison. At the Convention in 1918, T. A. Rickert and Jacob Fischer were substituted for James O'Connell and H. P. Perham. ^ Report of the Proceedings of the Thirty-sixth Annuai Convention of the American Federation of Labor, Baltimore, 1916, p. 145. ( 638 "We strongly recommend that the subject of social insurance in all its phases be given greater consideration and extension by the unions and preferentially by the national and international unions, as well as by the local unions, and in any event, in so far as social insurance by the state and national governments is concerned, if established at all, shall be voluntary and not compulsory/' In its Report to the Convention at St. Paul in June, 1918, the Executive Council made the following comment and recommendation :^^ "The organized labor movement approved the enactment of work- men's compensation legislation. Their approval of that legislation was based upon the theory that when the earning power of a worker was impaired by reason of an industrial accident, that he or his dependents should be compensated during the time he was suffering from said injury. The same rule holds good when the worker becomes incapacitated through illness — particularly illness due to trade or occupation. He and his family suffer through the impairment of his earning power just the same when he is ill as when he sustains an injury. The organized labor movement of America ought to formulate a program upon this subject. "We therefore recommend to this convention that it authorize the Executive Council of the American Federation of Labor to make an in- .vetigation into the subject of Health Insurance, particularly as it applies to trade or" occupational disease. If approved a model bill be formulated and reported to the A. F. of L. for approval. We urge that as part of such legislation there should be embodied fundamental princi- ples of democratic administration and guarantee to the workers of an equal voice and equal authority in the administration of all its features. "It was decided that the E. C. recommend to the convention that it authorize the E. C. to appoint a committee to make a study and report on the desirability of enacting laws providing for the payment of sick benefits .during time of illness.'' The Annual Convention of the American Federation of Labor is composed of delegates from the national and international trade unions * and from state federations and certain local labor federations. The number of delegates in 1918 was 448. At the Baltimore Convention, 1916, the Convention unanimously approved the recommendation of its Executive Council, as quoted above, in opposition to compulsory social insurance. It also passed this resolution : "Resolved, That the American Federation of Labor ir. Thirty-sixth Annual Convention assembled, declares against private insurance or insurance for profit, as it may apply to industrial, social or health insurance."*^ At the Convention in 1918 a resolution introduced from the floor and approving "a comprehensive national svstem of social insurance" was voted down on the ground that it did. not provide for the investi- gations which "should necessarily precede a definite conclusion or pro- gram on th e subject." The Convention, at the same time, approved the ^1^-w^^'"^^^^ *^^ Pj'oceedings of the Thirty -eighth Annual Convention of the American Federation of Labor, St. Paul. 1918, p 94 A^ll.?P%^ A^^ }^^ P/oce^tiings of the Thirty-sixth Annual Convention of the American Federation of Labor, Baltimore, 1916, p. 216. 639 recommendation of the Executive Council above quoted^ and instructed tlie Council to make the investigation.*^ Through inquiries made by correspondence with the secretaries of labor organizations, it has been found that the following national and international unions have placed themselves on record as favoring com- pulsory health insurance: Brotherhood of Kailway Carmen of America; Journeymen Stone Cutters' Association; International Brotherhood of Pulp, Sulphite and Paper Mill Workers of the United States and Canada; International Fur Workers' Union of the United States and Canada; International Ladies' Garment Workers' Union; International Seamen's Union; International Stereotypers' and Electrotypers' Union of ^orth America; International Union of Steam and Operating Engineers; Inter- national Union of Mine, Mill and Smelter Workers ; International Typo- graphical Union; National Women's Trade Union League; and United Brewery, Flour, Cereal and Soft Drink Workers of America. Sixty- two secretaries of national and international unions replied that no action had been taken by their organizations. The Brotherhood of Locomotive Enofineers was the onlv national or international union that reported having' passed a resolution against compulsory health insur- ance.^- In addition to the above, the Xew York State Federation of Labor reports the following national and international unions as favor- ing compulsory health insurance: American Wire Weavers^ Protective Association; International Glove Workers' Union of America; Spin- ners' International Union ; Eetail Clerks' International Protective Asso- ciation. Correspondence Avith the secretaries of State Federations of Labor furnishes the following list as favoring compulsor}^ health insurance :. The State Federations of Labor in Arkansas, California, Colorado, Indiana, Massachusetts, Minnesota, Missouri, Xew York^ Pennsylvania, and Wisconsin. There were ten State Federations that reported no action taken. Xone reported having passed a resolution against com- pulsory health insurance. The New York State Federation of Labor reports these additional State Federations as favorable to compulsory Health insurance."*^ State Federations of Labor in Alabama, Con- necticut, Marvland, District of Columbia, Illinois, New Jersev and West Virginia. Whatever opposition to compulsoiy health insurance exists on the part of organized labor arises partly from the belief that such a measure might undermine union activity and prove to be only a palliative and > a substitute for better wages, hours and conditions of labor. Thus, ' Samuel Gompers, President of the American Federation of Labor, has said :** «oi a«L,?!H? • ^*^%"^!^^^M^^"^ Chemists' Association of the United States : Nsit- mohIA^i A oc. «. /?£ Cotton ISIanufacturers ; National Association of Manufacturers ; ?ni^o^L^^^°„^».^^'°V T?^ ^^''l ^Manufacturers ; National Automobile Chamber of ?f^I?3i^ri;.5o?^ T^^"^' ^°St *^"*^ ^^^^ Manufacturers' Association : National Council ^.«Hnn" M^L^t^^"^ V ?^*.l^°"^^ Erectors' Association ; National Founders' Asso- ?lnorn«'roJl^i 2mI ¥^}^\ J""^^^! Association; Rubber Association of America, Incorporated . Silk Association of America ; United Typothetae of America. 641 but no employer should he assessed therefor in any greater degree than he would be for any other burden that falls generally upon the com- munity. The National Association of Manufacturers has not taken any positive action for or against compulsory health insurance, although ^ it has had a committee investigating the subject since 1915. At its Annual Convention in that year it approved of the appointment of a Committee on Industrial Betterment, to study the problems of social legislation; particularly, the questions of the minimum wage, insur- ance against sickness, and unemployment. This Committee stated in its 1916 report that "sickness insurance should be made to cover workers independent of whether the cause of the sickness arose out of or in the course of employment. The report also stated that, "The plan must contain the elements of compulsion, direct or indirect, as a matter of expediency in securing the acceptance of the act,"*^ The Committee on Industrial Betterment for the year 1916-1917 had a slightly different personnel, William P. White replacing^ F. C. i. Schwedtman, as chairman. Its report at the 1917 Convention carried the following paragraph :^" "Your Committee is not convinced from its study of the available data on the subject that the creation, establishment, and operations of a state-goverened system of compulsory sickness insurance is either necessary, wise, or desirable." The report of the Committee on Industrial Betterment for 1917- 1918 contained the following statements:*^ "Sickness is not only a problem for the community as a whole,, to be treated as an administrative function of the State, but it is also a problem arising out of industry." *Tt would seem to your Committee that, prior to the consideration of a compulsory form of industrial sickness insurance, the question of voluntary insurance should be carefully reviewed, especially the study of the existing systems ^n operation in many of our industrial and transportation companies. "The Massachusetts Commission on Social Insurance has declared itself to be ^unanimously of the opinion that the principle of insur- ance is a desirable one for application on a sufficiently wide scale to safeguard every wage earner in the Commonw^ealth from certain of the evils of sickness * * *.' With this principle your Committee thoroughly agrees, for insurance is the proper method to distribute the losses of sickness, and is so generally recognized." "We hazard the opinion that unless sickness insurance is demo- cratically administered, equitably worked out, and extended to cover practically all kinds of wage workers, there will be enacted into law compulsor}' sickness insurance — a proceeding which your Committee at the present time feels would be some reflection on the high standards *' Proceedings of Twenty-first Annual Convention of the National Association of Manufacturers, 1916. pp. 33-39. *'' Proceedings of the Twenty-second Annual Convention of the National Asso- ciation of Manufacturers, 1917, p. 21. ** Proceedings of the Twenty-third Annual Convention of the National Asso- ciation of Manufacturers, 1918, p. 162-164. —41 H I 642 of industrial conduct which characterize the safeguarding of American workers." None of the above reports were adopted; they were accepted and ordered printed. Attitude of Medical Profession. The Board of Trustees of the American Medical Association ap- pointed in January 1916 a special committee to investigate social in- surance. This committee issued a series of pamphlets, dealing chiefly with health insurance. In June 1917, the House of Delegates of the American Medical Association passed a resolution encouraging further work on the subject and instructing its Council on Health and Public Instruction to cooperate when posssible "in the molding of these laws that the health of the community may be properly safeguarded and the interests of the medical profession protected^^ and to "insist that such legislation shall provide for freedom of choice of physicians by the insured; payment of the physician in proportion to the amount of work done; the separation of the function of medical officials supervision from the function of daily care of the sick; and the adequate repre- sentation of the medical profession on the appropriate administrative bodies." This resolution, it will be noted, is neither for nor against com- pulsory health insurance and is the only resolution on the subject ever passed by the House of Delegates of the American Medical Asso- ■ciation. The medical organization proposed in the Standard Bill is in harmony with this resolution. This would necessarily be so, since the Committee on Social Insurance which presented the resolution to the Medical Association for approval was represented by Dr. Alexander Lambert on the Committee of the Association for Labor Legislation which drafted the provisions of the Standard Bill. - The state medical associations, for the most part, have taken no action in the matter. Of thirty-four state associations replying to questionnaires, thirty-one had not gone on record; one (Wisconsin) had passed a resolution favoring the principle of compulsory health insur- ance; and two (Illinois and Delaware) has passed a resolution opposing it. In New York, the Chairman of the Committees on Legislation and Economics of the State Medical Society appeared before the Judiciary Committee of the State Senate to oppose the Nicoll Bill. Dr. H. L. Winter, Chairman of the Committee on Economics, stated that he had communicated with all the county medical societies in the state and that they. were unanimously opposed to the bill. At the Second Annual Meeting of the American Association of Industrial Physicians and Surgeons in 1917, including mainly mem- bers of the profession employed by corporations^ the report of the Com- mittee on Health Insurance which stated "that the principle of health insurance which makes proper provision for the prevention of sickness as well as proper provision for the relief of sickness is a sound one" was unanimously adopted. Tliis resolution had reference to compulsory health insurance 643 Public health physiciaoSj, while they seem generally to favor the establishment of governmental systems of health insurance, believe "That in any scheme for health insurance, all activities looking toward the active conservation and promotion of health should be entrusted to the regularly established health conservation agencies, which should be reorganized or reinforced for that purpose, if necessary."*^ Dr. B. S. Warren, of the United States Public Health Service would have the state health commissioner made a member of the health insurance Commission. He would also have the referees who supervise the medical benefits, in the employ of the health department. It is doubtful whether the medical profession would submit to this control. As with the physicians, all the other interests affected: nurses, dentists, druggists, oculists, and hospitals, demand that they shall be represented. The public health nurses do not object to the scheme, if we may take as representative the sentiments expressed by Mary Beard, President of the National Organization for Public Health Nursing: "We public health nurses have more conclusive evidence than any other group in America (of the need of health insurance) * * * Health insurance is advancing more and more certainly."^^ The American Hospital Association at its meeting^ September 27, 1918, adopted this resolution: '^Resolved, By the American Hospital Association that the im- portance of health insurance investigation be recognized by this body and the Board of Trustees be directed to make a study of the subject in its relation to the hospitals and dispensaries; that the Board of Trustees give such assistance as may be requested in the formulation of plans and of legislative bills ; that the members of this Asociation and . the State Hospital Association be urged to give the subject careful study and to cooperate wherever possible in the effective solution of the problems unsolved.'^ Attitude of Druggists. In as much as compulsory health insurance will mean more or less wholesale distribution of drugs, it would be expected that druggists would not take kindly to the plan. The American Pharmaceutical Association passed the following resolution at its 1917 convention: "The American Pharmaceutical Association desires to express its disapproval of the Compulsory Health Insurance Bills introduced in different state legislatures during the past winter. It is quite likely that, in the interests of wage-earners of very limited income some- thing in the way of social insurance should be provided under the super- vision of the state, but the present plan goes much too far and is open to many vital objections.'^ The National Association of Retail Druggists at its 1918 convention passed this resolution : ** Resolution adopted at the Fifteenth Annual Conference of State and Territorial Health Officers with the U. S. Public Health Service, 1917. ^" Quoted in the Fifth Report of the Committee on Health of the New York Federation of Labor. 644 "Whereas, The Proponents of compulsory health insurance con- tinue their activities in an effort to force such a measure upon the people of the several states, and "Whereas, We believe such Prussiani zed le^slat ion to be inimical to the practice of pharmacy ; thereTore be it Resolved, That the National Association of Eetail Druggists be and hereby is requested to reiterate its opposition to such obnoxious measures and to lend its assistance to the pharmacists of the various states in their efforts to prevent the enactment of compulsorv^ health inpurance laws." The "floating six-pence" of the British Health Insurance Act^ a plan whereby the physicians' fund benefits by reduction in the amount of drugs prescribed, is responsible for much of the hostile feeling on the part of druggists. Attitude of Insurance Companies. The interest most deeply affected adversely by compulsory health insuran|ce would be the commercial insurance compan}'. The majority of labor organizations that have gone on record as favoring health insurance, declare themselves opposed to commercial insurance carriers. The plan submitted by the American Association for Labor Legislation likewise excludes the commercial insurance carriers. The industrial insurance companies w^ould suffer most of all, since they in reality supply what amounts to burial insurance. The Insurance Year-Book for 1918 states that industrial insurance companies have issued 38,373,272 industrial policies in the amount of $5,193,830,295. The average policy is tlierefore about $138. The casualty companies would be affected somewhat, but their business is not so directly connected with wage- earners. The commercial insurance companies are conducting a well organized and extensive propaganda against compulsory health insurance. Per- Iiaps tlic most pronounced opponent of compulsory health insurance is Br. Frederick L . Hoffman, Statistician and Third Vice-President of the Prudential Insurance Company. His pamphlet, "Facts and Fallacies of Compulsory Health Insurance" published by the Pmdential Press, Newark, N. J., has been widely distributed and forms a large part of the arguments and statistical data of the opponents of compulsory health insurance. P. Tecumseh Sherman, New York attorney and former Commis- sioner of Ubor of that state, has issued a pamphlet, "Criticism of a Tentative Draft of an Act for Health Insurance." Mr. Sherman fre- quently appears at legislative hearings as counsel for insurance companies. The fraternal insurance associations also feel that their interests would suffer. At the National Fraternal Congress of America 1918, it was resolved "That the constituent societies of the Congress use all honorable means to prevent the enactment into law in any form of a plan for social insurance through ^tate or National control." Other propaganda agencies supporting the insurance companies are: The Workmen's Compensation Publicity Bureau (New York), 645 The Insurance Economics Society of America (Detroit), and the Cali- fornia Research Society of Social Economics (Los Angeles). Attitude of Other Interests Affected. Most of the foregoing discussion has been confined to an analysis of the attitude of the major interests directly affected. However, there are some groui^s and associations;, representing interests indirectly affected or which arc more or less detached interests, which should be mentioned. The majority of charity workers seem to favor compulsory health insurance. Eugene T. Lies, until recently Superintendent of the United Charities, Chicago, believes "Health Insurance would bring to wage- earners prompt medical care, cash benefits to tide them and give them an early chance for recovery, all for a small insurance premium."^^ J. W. Magmder, general secretary, the Federated Charities, Baltimore, Md., says "The charity organizations, however, will be the more able to accept the responsibility for the relatively small group of unfortunates (not covered by health insurance. )^'^^ The socialists claim to .be the first political party in this country ^ to adopt a. compulsory insurance plank. The Social Democratic party in 1900 .had a plank providing for "I^ational Insurance of working people against accident, lack of employment and want in old age."' The 1904 platform of the Socialist Party carried a plank "for the insurance of the workers against accident, sickness and lack of employment ; for pensions for aged and exhausted workers." The 1908 plans added death insurance. The 1912 and 1916 platforms had the following provisions: ^'X general system of insurance by the state of all its members against unemployment and invalidism and a system of compulsory insurance by employers of their workers without cost to the latter, against industrial diseases, accidents and death." Tlie-PxQgresaives_.W£re the second national party to endorse health insurance, declaring in the 1912 platform for: "^ The protection of home life against hazards of sickness, irregular employment and old age through the adoption of a system of social insurance adapted to American use. ThejChristian Scientists are opposed to compulsory health insur- ance because they believe it is unjust to compel them to contribute toward the support of a system which is repugnant to their religious beliefs and from which they can receive no benefit. They played an influential part in the defeat of the California Constitutional Amend- ment. The N'ational Consumers' League at its recent meeting in 1918 passed the following resolution : Whereas, The wartime experience of women as wage-earners taking the places of men has greatly emphasized the need of compulsory health insurance; therefore be it "Resolved, That the National Consumers' League endorse in prin- ciple the prompt passage of health insurance by the state legislatures." ^'^Proceedings of National Conference of Social Work, p. 552 '^^U. S. Bureau of Labor Statistics, Bulletin 212, p. 636. C46 The National Civic Federation, which is designed to represent organized labor, organized industry and the general public, began in 1913 what was expected to be a five year investigation of social insurance in this country and abroad. The Committee on Preliminary Foreign Inquiry, a sub-committee of the Social Insurance Department, sub- mitted a report in 1914 covering the operation of social insurance in England. Further foreign investigation was cut short by the war. The report on England on the whole was unfavorable and the committee concluded "that the entire Aovement as it has thus far advanced in England is still too young to afford any permanent conclusions upon its human or social economic values.^' The members of this committee were: J. W. Sullivan, representing the American Federation of Labor; Arthur Williams, representing employers; P. Tecumseh Sherman, At- torney and Social Insurance Specialist. Mr. Sherman has been men- tioned before as author of a pamphlet criticizing the Standard Bill and as an attorney representing insurance companies. The Social Insurance Department of the National Civic Federation on February 20, 1917, published the following resolution : "Resolved, That the Social Insurance Department of the National Civic Federation, composed of representatives of organized labor, organ- ized industry and the interests of the general public, emphatically declare itself opposed to the contemplated legislation with reference to com- pulsory health insurance, as inimical to the best interests, present and future, of the workers of the nation."^^ A month before this resolution was adopted the annual meeting of the National Civic Federation had been held under the auspices of the Social Insurance Depai-tment. At this meeting, which was devoted to Compulsory' Health Insurance, all of the addresses with the exception of those descripti^^ of establishment funds, were in opposition. The California Referetidum. At the last election (November 1918) there was submitted to the people of California for a referendum vote an amendment to the state constitution, which was designed to give the legislature power to pass social msurance legislation. This amendment had been offered by the Social Insurance Commission whose report has already been mentioned above. The amendment failed of passage by a vote of more than two to one. The Christian Scientists are said to ha^^ been a potent factor in bringing about this result. In addition to the opposition of Christian Scientists, the fraternal and commercial insurance companies assisted in defeating the amend- ment. Some of the large fraternal organizations sent a personal com- munication to each of their members, asking that they vote against the amendment . In this way over 200,000 voters are said to have been PWpr4d*b?%'hr£^iriX1v«^?^n?S^ttl^''^"^^"^^ Department. Reprint May 26. 1917, f?Sldlnt of Met7S?ol?«n rSn^r^^ o^ Lee K. Frankel, Third Vice- jS^Sluonot^^Srlcu!l^^^^ chairman; A. Parker NeVin, National Ch5J?man o? the^oSarinSriinf^rf ""^.^r^' American Federation of Labor. The iSem'Suon^' Brother'llSLd' of^Lo^c^mo'^^^^^^^ S- ^tone. Grand Chief 647 reached. The Associated Fraternal Societies of California also issued literature under the auspices of the California Eesearch Society of Social Economics, which has already been mentioned as one of the propaganda agencies supporting the commercial insurance companies. ^ 14 DAY USE RETURN TO DESK FROM WHICH BORROWED DOCUMENTS DEPT. This book is due on the last date stamped below, or on the date to which renewed. Renewed books are subject to immediate recall. m 2 2 1 562 uix INTER-LIBRARY — torn 14 DAYS AFTER RECEIPT JUN 8 1962 11 PI a v.u.L.A. niiF ^A DAYS AFTER RECEIPT INTERLIBRARY LOAN MAY 3 1967 LD 21-20m-8,'61 (Cl7958l0)476 General Library University of California Berkeley yc 34978 >f^/^<^3 UNIVERSITY OF CALIFORNIA LIBRARY * ,