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Health care reformer Dr. Michael Shadid speaks to future founders of Group Health Cooperative in Seattle on August 14, 1945.

On August 14, 1945, Dr. Michael Shadid (1882-1966), a pioneering health care reformer, speaks at Seattle's Roosevelt Hotel to some 50 people, including the future founders of Group Health Cooperative. Dr. Shadid is the founder of the nation's first cooperatively owned and managed hospital, which is located in Elk City, Oklahoma. He is a crusader whose mission is to overthrow the traditional fee-for-service practice of medicine dominated by solo practitioners, expensive specialists, and private hospitals and clinics. Instead he advocates affordable, prepaid healthcare through the cooperative ownership of hospitals staffed by physicians -- practicing as a group -- who promote the new idea of "preventive" medicine. Dr Shadid is brought on a speaking tour of Seattle and towns in Eastern Washington, Idaho, and Oregon by future Group Health founders Addison "Ad" Shoudy (d. 1993), manager of Puget Sound Cooperative, a West Seattle grocery, and R. M. "Bob" Mitchell (d. 1947), founder of the giant Pacific Supply Co. Coop established in Walla Walla in 1933.
File 7411: Full Text >

Physicians purchase Seattle's Medical Security Clinic, a prepaid practice soon to become part of Group Health Cooperative, on September 27, 1945.

On September 27, 1945, a group of idealistic physicians purchase Seattle's Medical Security Clinic, a prepaid practice soon to become part of Group Health Cooperative. The Medical Security Clinic has an enrollment of some 20,000 individuals, mostly workers building ships and airplanes for the war effort (World War II). The values and practices of the clinic, including physicians sharing expertise and cooperating in the care of patients, an emphasis on preventive care, and the very idea of prepaid medical care, is opposed by the local branch of the American Medical Association, the King County Medical Society.
File 7410: Full Text >

Group Health Cooperative of Puget Sound incorporates on December 22, 1945.

On December 22, 1945, the founding board of the Group Health Cooperative of Puget Sound (GHC) files incorporation papers with the State of Washington. After many years of struggle and despite active opposition by the medical establishment, Group Health will become one of the nation's largest consumer-directed health care organizations.
File 2747: Full Text >

Kirkland forum spurs Group Health Cooperative on March 14, 1946.

On March 14, 1946, Group Health Cooperative attorney Jack Cluck meets William "Sandy" MacColl, M.D., a pediatrician with the Medical Security Clinic, at an East Side Forum on health care reform. The two health care visionaries hit it off and begin formulating a merger of their organizations, which will spur development of the Group Health Cooperative of Puget Sound.
File 2911: Full Text >

Group Health Cooperative's Acting Board of Trustees votes in principle to purchase Medical Security Clinic on August 14, 1946.

On August 14, 1946, Group Health Cooperative's Acting Board of Trustees votes in principle to purchase Medical Security Clinic (including a 50-bed hospital). The Medical Security Clinic is a prepaid practice, unusual at the time, owned by a group of idealistic doctors who believe in the new idea of preventive medicine. Group Health Cooperative is a recently formed non-profit corporation that will soon have a member-elected board of trustees (the inaugural membership meeting will take place in three weeks). Creation of Group Health (which at this early point has members but no doctors) was inspired by Dr. Michael Shadid (1882-1966), a crusading Lebanese-born physician who had established America's first cooperative hospital in Elk City, Oklahoma. The marriage of the two organizations, giving the doctors patients and Group Health members doctors, will proceed with difficulty due to the opposition of Dr. Shadid.
File 7448: Full Text >

Group Health Cooperative holds first formal membership meeting and passes bylaws on September 4, 1946.

On September 4, 1946, the newly formed Group Health Cooperative holds its first formal membership meeting in downtown Seattle and passes bylaws. The preamble to the bylaws sets forth principles and objectives that will guide Group Health's future evolution, including a commitment to quality care, preventive medicine, an aggressive outreach program, the consumers' cooperative plan, physician autonomy, workers' rights, health education, and public health advocacy. In an oversight, the bylaws omit the principle of nondiscrimination, which will be added a few weeks later. Group Health will become one of the nation's largest consumer-directed health care organizations.
File 7409: Full Text >

First Group Health Cooperative baby is born on November 15, 1946.

On November 15, 1946, Trygve Erickson is born at St. Luke's Hospital on Seattle's Capitol Hill and Group Health announces him to be the first baby born under Group Health ownership of the hospital (which is later renamed Group Health Hospital). Group Health Cooperative is not quite two years old and is in the process of purchasing the hospital from the Medical Security Clinic.
File 7412: Full Text >

Group Health Cooperative formally begins offering medical care and hospital services on January 1, 1947.

On January 1, 1947, Group Health Cooperative of Puget Sound officially opens the doors of its first downtown Seattle clinic and a small hospital, St. Luke's, on Capitol Hill. The member-governed Cooperative is barely two years old. It acquired the hospital and other facilities by purchasing the physician-owned Medical Security Clinic, an existing prepaid service, in 1946.
File 2912: Full Text >

Virginia Mason Clinic and Group Health Hospital begin collaborating in 1947.

In 1947, Seattle's Virginia Mason Clinic and Group Health Cooperative begin collaborating. This is the year, two years after its founding, that Group Health begins offering medical services.
File 7415: Full Text >

Group Health Cooperative expresses solidarity with Boeing machinists by granting them membership on a deferred-dues basis during their strike that begins on April 22, 1948.

Between April 22 and September 13, 1948, the newly founded Group Health Cooperative expresses solidarity with Boeing Co. machinists (International Association of Machinists, or IAM) by granting them membership on a deferred-dues basis. This action solidifies Group Health's relationships with labor, but results in the Boeing Company's longterm enmity toward Group Health.
File 7426: Full Text >

Group Health Cooperative opens its first satellite clinic, in Renton, on July 6, 1948.

On July 6, 1948, Group Health Cooperative opens its first satellite clinic, in Renton. The town south of Seattle is the stronghold of many of the union and grange leaders who had helped to found the health care cooperative, and Group Health has 376 members in the area. Also, Group Health anticipates access to the Renton Hospital. However, opposition to the consumer-oriented health care organization by the King County Medical Society (the local branch of the American Medical Association) will result in Group Health doctors being barred from Renton Hospital.
File 7413: Full Text >

Group Health Cooperative holds its first district-based board election on November 5, 1949.

On November 5, 1949, Group Health Cooperative holds its first district-based election for its board of trustees. This is a crucial reform in Group Health's governance. The new policy provides for a board with five district-elected candidates and four at-large candidates. It will increase member participation and democracy in the health care co-op, and will also have the effect of increasing the clout of the Renton district, which represents one-tenth of the membership and includes some of the most active supporters.
File 7418: Full Text >

Group Health Cooperative, succumbing to Red Scare fears, rejects the membership application of William Pennock on September 19, 1950.

On September 19, 1950, Group Health Cooperative, succumbing to Red Scare fears, rejects the membership application of William Pennock. Pennock is a well-known member of the Communist Party. Some board members question the ethics of rejecting a potential member because of political convictions, but they are in the minority.
File 7420: Full Text >

Washington State Supreme Court finds for Group Health in its suit against King County Medical Society on November 17, 1951.

On November 17, 1951, the Washington State Supreme Court rules in favor of Group Health in its suit against King County Medical Society. (The society is the local branch of the American Medical Association.) King County Medical Society barred Group Health doctors from membership while declaring nonmembers "unethical." The society caused local hospitals (Renton Hospital, Swedish Hospital, Seattle General, and others) to refuse staff privileges and assistance to Group Health doctors, made it impossible for Group Health doctors to buy insurance in the United States, and in other ways opposed and fought Group Health, which it called a "socialist group." Group Health charged that King County Medical Society engaged in a conscious conspiracy to monopolize contracts for its own doctors. The court ruling in favor of Group Health was unanimous and the court took the extraordinary step of placing King County Medical Society under effective probation for three years, during which any further interference with Group Health would be deemed contempt of court.
File 7414: Full Text >

Group Health Cooperative formalizes a Joint Conference Committee to work out differences between medical staff and Board of Trustees on October 25, 1952.

On October 25, 1952, Group Health Cooperative formalizes a Joint Conference Committee to work out differences between the medical staff and Board of Trustees. Group Health was organized as a non-profit corporation with a member-elected board responsible to members and bylaws, not as a true cooperative in which members own equity shares. The medical staff, acquired when Group Health purchased the Medical Security Clinic in 1946, manages its own affairs. It has its own bylaws, chief of staff, standards for hiring and dismissing, and other professional criteria. By 1952, significant conflicts create severe tensions between Group Health's medical staff and its board of trustees. The Joint Conference Committee is formed to work out these tensions.
File 7423: Full Text >

Group Health Cooperative dedicates Northgate Clinic on March 22, 1958.

On March 22, 1958, Group Health Cooperative dedicates the Northgate Clinic. The clinic is designed by Paul Kirk and will win honors from the American Institute of Architects. Dr. William "Sandy" MacColl, a Group Health founder and its first pediatrician, becomes the Chief of Staff for the Northgate Clinic.
File 7421: Full Text >

Group Health Cooperative dedicates new hospital on Seattle's Capitol Hill on October 8, 1960.

On October 8, 1960, Group Health Cooperative dedicates its new hospital on Seattle's Capitol Hill. The 173-bed hospital, located on E John Street and 15th Avenue E, was financed by a fundraising campaign, Operation Zero Mortgage, that raised the entire $3.2 million cost of building the hospital.
File 7422: Full Text >

Group Health Cooperative magazine publishes a letter from a member asking that smoking be banned in clinic waiting areas in March 1964.

In March 1964, the Group Health Cooperative magazine, View, publishes a letter from a member asking that smoking be banned in clinic waiting areas. This letter, from Mrs. Millard Petersky, is the first shot fired on a new public health front.
File 7563: Full Text >

Group Health Cooperative mental health advocate Dr. Bernice Sachs is elected president of the American Medical Women's Association in October 1964.

In October 1964, Dr. Bernice Sachs, Group Health Cooperative's leading champion of the notion that mental health services should be offered as part and parcel of medical care, is elected president of the American Medical Women's Association. This honor may have helped to persuade Group Health to approve the hiring of its first full-time psychiatrist the following month. The American Medical Women's Association was founded in 1915 with the mission of helping women advance in the field of medicine and advocating for women's health.
File 7428: Full Text >

Medicare becomes available on July 1, 1966, and Group Health Cooperative begins accepting older patients.

On July 1, 1966, Medicare becomes available following the signing of the Medicare Act into law by President Lyndon B. Johnson. The new law begins a revolution in health care, but its compromises result in a system that institutionalizes fee-for-service care. This in turn will spur chronic increases in health-care costs, since the system, instead of controlling costs, pays physicians' "usual and customary" fees, which inevitably begin rising. Institutions with an incentive to keep down costs like Group Health Cooperative (where service is provided based on advance payments, not fee for service), are at a disadvantage. Nevertheless, Group Health advocated the reform, works to improve it, and begins accepting Medicare patients.
File 7606: Full Text >

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