On March 14, 1946, Group Health Cooperative attorney Jack Cluck meets William "Sandy" MacColl, M.D., 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.
Jack Cluck (d. 1983) was a longtime leader in the cooperative movement who served as corporate counsel for the incorporation of Group Health in December 1945. Sandy MacColl (d. 1989) was a pediatrician with the older Medical Security Clinic, with offices in downtown Seattle and a small hospital, St. Luke's, on Capitol Hill. After the forum in Kirkland's old Lake Washington High School, the two men retired to have a beer and discuss how their organizations might join forces.
The Medical Security Clinic was established in 1938 to offer prepaid care to workers. It also evolved into one of the state's first group practices, in which physicians jointly owned and managed both a small clinic in Seattle's Securities Building and St. Luke's Hospital on Capitol Hill.
Not A Match Made in Heaven
Group Health had only been incorporated in December 1945 by a coalition of cooperatives, granges, and labor unions. It immediately attracted several hundred members and had the prospect of garnering many more through participating unions, but for the lack of medical staff or facilities.
Medical Security Clinic had both, but it faced dwindling enrollment as defense industries scaled back after World War II. A merger of the two groups seemed natural, but it sparked a heated debate on both sides. Medical Security's staff feared the loss of physician control, and Group Health supporters feared that the doctors would overrule members in setting rates and policies.
A compromise was finally approved on November 8, 1946, in which Group Health paid approximately $250,000 for Medical Security's assets, name, and enrollment of 8,500 subscribers. Medical staff retained professional autonomy, while affirming the right of Group Health members to control costs and general policies. Group Health's new medical staff began treating its members on January 1, 1947.