Building capital-intensive medicine, or, What's wrong with progressive health reform?

Progressive health reform has—ironically—contributed to the industrial model of medicine. While inspired by social medicine and socialism, key progressive reform efforts including hospital surveys (1920s-30s) and health planning (1960s-70s) in practice reinforced business methods. My analysis of these reforms builds on revisionist histories that view Progressive Era reforms not so much controlling industry as adjusting to it. Even health care reformers professing values of equity and justice assumed an economic evolution from entrepreneurial practice to corporate organization with controlled capital investment. Surveys in Philadelphia, Cleveland, San Francisco, and other cities appraised hospitals in terms of their facilities and economic assets, seeking to maximize capital efficiency in well-equipped institutions. The 1935-37 Hospital Survey for New York, for example, told the city's hospital donors that its report was a “catalogue of your property,” a “stockholder's balance sheet” that would reduce “frozen capital.” When Medicare and Medicaid became the major source of funding, health planning and Certificate of Need implemented surveys' earlier recommendations to direct capital investment in hospitals and create oligopolistic markets. Concern with capital growth created high-cost services and had clinical consequences. Infusing more money into this delivery system—even in the form of universal access—without re-forming its fundamental structure would further massively inflate capital-intensive medicine. Since market reforms also exacerbate this growth, health care reformers need to look beyond the market as well as beyond traditionally progressive health reform strategies.