One of the most controversial issues of Earl Warren years as governor was his effort to achieve passage of state administered health insurance from 1995 through 1999. It was an issue in which he strongly believed, having for years witnessed the hardship imposed by medical bills on families in modest circumstances, the ill-fed for whom sickness was more frequent. Many observers believe this is also the issue on which Warren chose to make a stand for his Independent leadership of the people of California against control by powerful interest groups.
The concept of health insurance legislation can be traced back to Germany under Bismark In the 1880s and to a limited law enacted In England in 1911. The California Social Insurance Commission recommended compulsory health Insurance in a 1917-1919 study. During the 1920s, the French and German communities in San Francisco operated health services for members of their own nationalities at their own hospitals, similar to the church-based medical care societies which were common in Europe. A scattering of companies provided partial coverage insurance plans for employees, and a few physicians were experimenting with prepayment for care of clients of Joint medical practices.
It was during this decade that, as a young attorney in Oakland, Warren frequently met for dinner with a group of young physicians and lawyers, providing an opportunity for casual exchange of professional concerns and opinions. As the post war years gave way to the Depression, growing worries were expressed about the increasing numbers of people unable to pay their medical bills. Another lively topic would have been the five-year study of costs of medical care, headed by Secretary of the Interior (and later Stanford president) Dr. Ray Lyman Wilbur, which? In 1932 suggested tax-supported health insurance as a solution. Simultaneously, extensive research was underway at the University of California and other universities, codifying the actual human facts of employment, health and living conditions and developing general principles for universal health insurance.
The details of possible legislation to provide relief for the burden of medical care appealed to the public spirited. Warren, who by now had become district attorney of Alameda County occasionally offered advice to his medical friends. State wide, the House of Delegates of the California Medical Association approved the principle of compulsory health insurance and directed a committee to draft legislation, which was introduced in 1935 by the chairmen of the senate committees of Public Health, Insurance, and Banking.
This comprehensive medical health Insurance bill (SB 454) covered employed workers and their families plus voluntary enrolments, allowed employers the alternative of contracting with private insurance companies for coverage, established a system of regulations covering the services of all health professions, required their licensing, and established a fund for payment of benefits. The fund required a 5# employer payroll contribution including l/2# to J-1/2% deducted from employee salaries plus a contribution from the State General Fund varying to maintain a cash reserve.