Posts Tagged ‘A.B. Ordway’

Injured on the job! The history of Kaiser Workers’ Compensation care

posted on April 16, 2014

Lincoln Cushing
Heritage writer

Part one of a two-part series

Unless one has the unfortunate experience of being injured on the job, one is usually unaware of a parallel health care system – the medical treatment provided as a benefit through the Workers’ Compensation Insurance system.

Regular health issues (diseases or injuries suffered while not at work) are handled through fee-for-service doctors or their insurance/health plan counterparts. But if something bad happens on the job, another set of rules apply. Employers are legally required to provide benefits to employees, including medical coverage, and treatment for these injuries is carried out by a separate system of insurance or self-insurance. Care is usually delivered by physicians specializing in Occupational Medicine. 

Early in the 20th century industrial injuries were rising, organized labor was becoming more powerful, and legislation was sought to mitigate the medical and legal consequences of on-the-job accidents. California’s first workers’ compensation law was the voluntary Compensation Act in 1911, followed by the Workers’ Compensation, Insurance and Safety Act of 1913 (the Boynton Act). For the first time, employers were required to provide benefits for all employees injured on the job. The employers benefited from expanded limitations on their legal liability. The Act also established a competitive state insurance fund, and it remains the foundation for workers’ compensation in California today.

Dr. Sidney Garfield’s desert experience

Worker-patient at Contractors General Hospital, under the care of Dr. Sidney Garfield, circa 1934.

Worker-patient at Contractors General Hospital, under the care of Dr. Sidney Garfield, circa 1934.

When Kaiser Permanente founding physician Dr. Sidney Garfield (along with partner Dr. Gene Morris) first set up his 12-bed Contractors General Hospital way out in the Mojave Desert in 1933, he wasn’t trying to revolutionize health care practice in America. He was simply a young doctor taking on a reasonably safe business opportunity, serving the medical needs of some of the 5,000 men working on the Colorado River Aqueduct Project who were insured through workers’ compensation.

Dr. Garfield soon found his practice foundering because the workers’ compensation insurance companies handling industrial injuries were sending the most serious – and most profitable – cases to favored Los Angeles hospitals. They also challenged many charges as unnecessary and were often late in paying. In addition, the remote setting of the work camps meant that these hospitals were the only place the workers could be treated for non-industrial diseases – something for which they could rarely afford to pay full fee.

Industrial Indemnity Exchange (which was one-third owned by Henry J. Kaiser) was the largest insurance company affiliated with the aqueduct project, and underwriter Harold Hatch offered a creative and mutually beneficial solution. In exchange for half of the 25 percent insurance premium that Industrial would have paid out for treatment, Industrial would pay that up front to Garfield and he’d promise to provide the requisite industrial care.

Garfield figured out that he could get the workers to also prepay a small, affordable amount (five cents a day), and he’d extend his services to cover comprehensive medical care.[i] 60 percent of Garfield’s income would eventually come from payroll deduction, 40 percent from workers’ compensation. The plan worked very well, and became one of the cornerstones of the Kaiser Permanente model.

Caring for wartime workers

Ambulances at Kaiser Richmond shipyard first-aid station, circa 1944.

Ambulances at Kaiser Richmond shipyard first-aid station, circa 1944.

This unusual integration of industrial and non-industrial medical care under one roof continued when Garfield directly partnered with Kaiser and operated the hospital at Grand Coulee Dam (1938-1941) and later at the seven West coast shipyards and one steel mill (Fontana) during World War II employing almost 200,000 workers.

Health care posed a significant challenge in operating the yards; because most of the able-bodied healthy men (the typical demographic for this industry) were serving in the military, those available for homefront needed job training and medical care.[ii] The option of affordable comprehensive health care was extremely attractive to the new workforce, and demand outstripped availability. Permanente Health Plan organizers struggled to add enough staff and facilities to handle new members.

Despite the superficial appearance to the end user that it was a single health plan, under the hood it still involved the bureaucracy and bookkeeping of two separate entities. The Health Plan Manual for the staff of Sidney R. Garfield, M.D., (circa 1942) clearly stated:

 Q. If a member is hurt while working on the job is he covered under the Health Plan?

A. No. The Health Plan does not cover Industrial accidents. These are covered under Workman’s Compensation.

Q. What is meant by Workman’s Compensation and how are we connected with it?

A. Under the Workman’s Compensation Act of California, most employers are required to provide medical and hospital care as well as weekly compensation to employees injured while working. The shipyards contracted with private insurance companies to provide and administer these benefits to the employees. We in turn made arrangements with the insurance companies to provide the medical and hospital services for a certain fee.

The combined health plans proved to be a powerful medical and economic engine. In August of 1943, A.B. Ordway, Vice President of the Richmond Shipyards, sent a report to B.K. Ogden, Director of the Division of Insurance, United States Maritime Commission, in Washington, D.C. He observed:

The shipyard management further realized that the type of medical and hospital care necessary to secure and maintain the best morale and productive results for shipbuilding could not be made available from the possible income that could be derived from industrial cases only.

Therefore, early in 1941 a plan was devised for offering to the employees of the above yards a Medical Health Plan at a fixed price per week. The possible income that could be secured through an Industrial medical plan and a medical Health plan was of sufficient size to justify expenditures of large amounts of money for buildings and equipment and to better enable the holder of the medical contracts to secure the large staff of doctors and nurses needed to adequately provide the best medical and surgical attention possible.

…Medical costs on industrial cases are lower than would be possible were it not for the fact that one organization handles industrial and non-industrial cases, and the industrial costs are controlled through one contract method.

Kaiser Richmond shipyard first aid station, circa 1944

Kaiser Richmond shipyard first aid station, circa 1944

In terms of running a huge industrial network, the advantages of a healthy workforce were obvious and quantifiable. Henry J. Kaiser himself noted:

In 1943, the average male industrial worker lost 11.4 days and the average female industrial worker 13.3 days of work due to sickness and injury. By far the greater proportion of this loss – 80 percent in men and 90 percent in women – was believed to be due to common ailments. This means that in the U.S. today there is a loss of more than 600,000 man-days annually. This is 47 times the amount of time lost through strikes and lock-outs of all kinds during 1943.[iii]

Kaiser used the above argument – and his successful experience with running industrial medical care programs – as the basis for a bold proposal for a nationwide pre-paid medical plan as the war waned in 1945. Dr. Paul Cadman, in an addendum to the proposal, laid out the premise:

The Health Insurance Plan follows the general pattern of the Workman’s Compensation Law, a law which has been in effect for over thirty years and has been found to be practical and workable.

Alas, the proposal never went anywhere, but Henry J. Kaiser’s health plan continued to grow bigger and better.


Next: Postwar evolution of Kaiser Permanente’s worker health care

Short link to this story: http://bit.ly/QdEFCz


Special thanks to Dr. Doug Benner, Coordinator of Regional Occupational Medicine Services (1993 to 2011) and Connie Chiulli (Director of Operations, Occupational Health Service Line, Regional Occupational Health, TPMG) for help with this article.

[i] A slightly different percentage is described by Rickey Hendricks in A Model for National Health Care: “Since Garfield was losing money yet providing needed services and model facilities, Hatch proposed that Industrial Indemnity prepay Garfield 17.5 percent of premiums, or $1.50 per worker per month, to treat industrial injuries.”

[ii] “…In 1944, with the [shipbuilding] program in full swing, it was rare to find a yard of five thousand employees or more who could boast of more than 5 per cent of workers with previous experience in shipbuilding.” “Health and Safety in Contract Shipyards During the War,” by Philip Drinker, Ch.E., in Occupational Medicine, April, 1947.

[iii] “Proposal for a Nation-Wide Pre-Paid Medical Plan Based on Experience of the Permanente Foundation Hospitals” Henry J. Kaiser, March 3, 1945.

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Latest Kaiser Permanente signature hoisted to the heights

posted on February 7, 2012

By Lincoln Cushing

Heritage writer

New Kaiser Permanente signage on The Ordway building, 12/20/2011; photo by Lincoln Cushing

On January 18 of this year, executives and contractors gathered in a top floor conference room a block away from The Ordway building in downtown Oakland, California. As darkness settled, brief speeches were made, a ceremonial switch was flipped, and huge Kaiser Permanente signs on both sides of the structure’s summit lit up with the energy-efficient brilliance of thousands of light emitting diodes.1

This was the first signage ever mounted on The Ordway, and it represents the most current appearance of the Kaiser Permanente logo, a copyrighted symbol that brands everything from pill bottles to skyscrapers. The new signs can be seen from across the city at night, and with the 1950 Franklin building, present two pairs of KP illuminated signatures on the Oakland cityscape.

“Family of four” logo, 1972

The Ordway, constructed in 1970, was named after Henry J. Kaiser’s first employee and long-time and trusted operations manager A.B. (Alonzo Benton) Ordway. “Ord,” as Kaiser called him, was hired in 1912 –100 years ago – when Kaiser was with the Canadian Mineral Rubber Company.

The Ordway is adjacent to the Kaiser Center at 300 Lakeside, Henry Kaiser’s pride and joy in 1960, which at 28 stories was the tallest building in the East Bay at the time it opened. Formerly the Kaiser Industries headquarters, the center still carries a sign that simply says “Kaiser.” The Ordway, Kaiser Center and the nearby 1950 Franklin St. building accommodate many of KP’s administrative offices.

KP brand identity evolved over decades

Sporting a consistent and polished brand signature is relatively new in Kaiser Permanente’s 67-year existence.  During World War II, Permanente Metals, which operated a medical care program for its wartime workers, did not develop a separate logo for the health plan. Rather, the Permanente Metals logo of three ship hulls inside a compass rosette appeared on the health plan brochure. The trio of ships likely represented the three West Coast wartime shipyards where Henry Kaiser built warships.

Although the health plan evolved on its own after the war, there is no evidence leaders sought any brand identity other than adopting for Kaiser Permanente’s signage the same typeface and style used to identify each of the Kaiser Industries companies.

‘Family of four’ mark emerges in 1970s

In the early 1970s, a silhouette nuclear “family of four” mark began to appear in publications and signage for the Kaiser Permanente Medical Care Program. In 1982 the Southern California Region hired Boyd Communications of Los Angeles to produce its own regional logo. Douglas Boyd designed a mark that featured one of the human figures but also integrated a stylized “K” for Kaiser Permanente.

Pre-1984 logo

The idea of a unified graphic representing all Kaiser Permanente’s regional health plans did not emerge until 1984, when a corporate identity committee was formed. The committee included Kaiser Foundation Health Plan and Hospitals Chairman and President James A. Vohs, Don Duffy, head of Corporate Communications, corporate identity experts, KP regional managers, and medical directors.

Logo design sparks debate in the 1980s

Southern California leaders had this logo created in early 1980s.

Kaiser Permanente was growing, and the “family of four” graphic that had been used by several – but not all – KP regional health plans was not only amateurish and antiquated, it had been imitated by competitor health care organizations because it was not protected by copyright. Vohs reflects on some of the challenges involved:

“As with almost any issue in Kaiser Permanente, there was a range of opinions about a new logo.  Quite often the leaders of the medical groups had different views from the leaders of health plan.  Also, the Southern California Region felt that the organization should adopt the logo they were using.

In addition, consultants from a previous design firm felt that we should change the name of the organization.  They thought strongly that ‘Kaiser Permanente’ as a title for a health care organization was a negative, and urged us to abandon it. (They were concerned that the name “Kaiser” was too closely identified with Henry J. Kaiser’s steel and aluminum industry, not with patient care and wellness).”

Vohs continues: “But from my point of view there were really just two concepts that needed to be reflected in any logo: that the arrangement between the ‘partners’ in the enterprise, the health plan and the Permanente Medical Groups, be recognized; and that there be just one style of logo used consistently throughout the organization to reinforce that Kaiser Permanente is one single multiregional and national enterprise.”2

1984 version logo

The resulting logo, created by Boyd Communications, was a distillation of concepts that reflected KP’s mission.  When the new graphic identity was released in 1985, a brochure was distributed explaining some of the design parameters and solutions:

“It had to convey: a feeling of warmth and caring; a sense of quality and professionalism; concern and commitment to one another; the partnership we share in providing health care to the community; and a progressive feeling.

“. . . The sense of community is there in the three figures. They can represent the three entities which make up our program (the Kaiser Foundation Health Plan, Kaiser Foundation Hospitals, and the Permanente Medical Groups), the families we serve, and the communities we’re located in. The radiating light transmits a sense of health and healing. The sunburst also reminds us of our roots in the desert, where (KP founding physician) Sidney Garfield started providing prepaid medical care more than 50 years ago (1933).”

Signature suits company’s mission

Current Kaiser Permanente logo

Boyd, who has created logos for many international businesses such as Apple, Hilton and Toyota, is humble when describing his team’s part in designing the KP logo. He likens his role to a “tailor” who simply put a nice “suit” on Kaiser Permanente.

“To be somewhat objective, it’s what the organization has done that makes the logo,” Boyd said. “A logo can’t make a company. And Kaiser (Permanente) has done an extraordinary job at becoming the best in the country at providing health care.”3

In 1999 the “family” symbol was slightly revised, this time under the direction of Landor Associates, another world-class strategic brand consulting and design firm, as part of the most comprehensive identity system KP had ever rolled out. This included a revised logo called the “signature”.

The 17 rays of light in the image were reduced to 14 and the typeface of the words “Kaiser Permanente” was changed. KP also standardized the horizontal configuration of the logo and type. Subsequent additional tweaking by the design firm of Kate Keating and Associates used even fewer rays in the “people” for enhanced legibility in specialized applications such as embroidery, pharmacy labels, and large signage.

Fittingly, during the centennial of A. B. Ordway’s hire, the towering edifice named after him glows with the most modern Kaiser Permanente symbology.

 

1 The energy-efficient sign is specially designed to illuminate white through the blue lettering for enhanced visibility at night.

2 Email correspondence with author 1/30/2012

3 Interview 12/2011 with Boyd by KP communications associate Kathleen Haley

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