Twenty years after Duke Hospital opened its doors to patients, Sarah Lee Wilkinson returned.
Wilkinson was the first patient born in the hospital's wards July 21, 1930-opening day-and some Duke officials regarded her surprising recovery as a portent of future success for the institution.
On both her and the hospital's 20th birthday celebration July 21, 1950, Wilkinson represented the growing maturity of the hospital and the 392,312 patients treated since its opening.
To put the number in perspective, the Duke University Health System-an empire that spans three hospitals, a medical center and clinics across North Carolina and southern Virginia-attended to 1,297,618 patients in 2005 alone.
As the school celebrates the 75th anniversary of medicine at Duke this year, the community is looking back and celebrating the origins of the world-renowned medical system. But in its first few years, the hospital faced an unexpected hurdle that threatened its continued existence.
In a book tracing the first 20 years of Duke University's schools of medicine, nursing and health services and Duke Hospital, administrators of the day estimated that 90 percent of patients were not paying for any services.
When the hospital opened, the nation was in the midst of the Great Depression. Health insurance was uncommon and Medicare and Medicaid were programs not yet offered by the government. What patients paid was determined based on a fee-for-service model. In 1929, an estimated 38 out of every 100 U.S. residents received no medical treatment at all because of cost.
"Patients of moderate means, unable to pay comfortably the full cost of unexpected or prolonged illness, tended to choose medical charity rather than financial tragedy," James Gifford, medical historian, wrote in The Evolution of a Medical Center.
Duke paid so much charity that hospital lore holds at one point, a well-dressed man entered the hospital, saying he heard Mr. Duke had left $4 million for charity, and he was there to collect his share.
"The percentage of persons paying part of their bills had to be raised if the Duke Hospital was to remain solvent," Vernon Altvater, the superintendent of Duke Hospital, said to the Duke Trustees June 8, 1931.
These economic problems resulted in a huge deficit for the hospital in its first fiscal year. The University paid a subsidy of more than $260,000-about as much as Dr. Wilburt Davison, the first dean of Duke Hospital and the School of Medicine, estimated the entire cost of operation for the first year would be.
Because of economic realities, several plans were put into place to curb diminishing revenues.
Davison envisioned one way to alleviate the high costs before the hospital was completed-an out-patient clinic. The first major one in North Carolina, the clinic was designed to accommodate a large amount of people cheaply and quickly.
Medical students or interns would check and test patients and run their diagnoses by a senior staff member. Then, the hospital would refer the patient back to their personal physician with details of how to treat the problem. The clinics also allowed doctors to screen the patients, so only the most deserving patients would be admitted to the wards.
In the boldest move to increase the amount of money the hospital collected, Altvater notified the public that after April 30, 1933, the hospital would not admit free patients. A patient's friends, church or the county welfare department would be expected to help out if he could not pay for the services.
By 1940, the program made it possible for Duke Hospital to treat about 15,000 patients who could not pay the full costs of healthcare, rather than giving 4,000 patients complete charity care. The program, which was unique to teaching hospitals, helped distinguish between the needy and the deadbeats.
Altvater also introduced the inclusive or flat hospital rate in 1933. Admitted patients were charged per day and were given complete services. The lowered rates made healthcare cheaper for the average patient.
The Private Diagnostic Clinic was also set up by clinical staff to give better care to patients with complicated problems and to provide a better funding mechanism for doctors during the Depression. This clinic received a higher proportion of money back, as patients were generally wealthier and complained less often.
This funding mechanism gave the administrators more leeway to solve other problems, like making sure doctors had time off and those who were also professors in the School of Medicine could take time to do research. Also, with a rise in the number of patients during the hospital's first 20 years, more money was put aside for a medical research fund.
This fund paved the way for the major scientific breakthroughs that have made Duke famous.
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