Cleveland Clinic Case Study

Introduction Since it’s founding in 1921, by four Cleveland, Ohio physicians: Dr. George Crile, Frank Bunts, William Lower, and John Phillips, the Cleveland Clinic has been making advances in the medical community that had previously been unprecedented (“Cleveland Clinic Celebrates”, 2011). The Cleveland Clinic started with a total staff of 12 people: six surgeons, one radiologist, four internists, and one biophysicist. From the beginning the founders knew that it was important to have a diverse staff with varying degrees of specialty in order to provide the best care for their patients (“Cleveland Clinic About Us”, n.d.). The founders were all military veterans that were inspired by the system and practices used in the military style of medicine.

The economy grew between 1920 and 1929 and the national wealth nearly doubled during that time. Some important innovations and discoveries that came during the time were the first commercial radio station, the electric refrigerator, the automobile, and penicillin (“The Roaring Twenties”, 2010). The Roaring 20s also had an effect on the hospital industry. Before this time hospitals had a negative connotation. Hospitals were a place that people went to die, not a place to receive treatment. Once hospitals started marketing their facilities as a “happy” place to go to receive treatment the hospital system began to change. With this change and the growing economy it is no surprise that the prices of items and services also grew. The total cost of hospital care for families rose from 7.8% to 13.9% between the years of 1918 and 1929 (Gorman, 2006). Hospitals were now clean, they employed educated professionals, and the treatments given were effective. To address the rising cost of healthcare the American Medical Association (AMA) attempted to address this issue during the 1926 convention. At the time, even though the economy was increasing as were people’s incomes, the rising cost of medical care made it difficult for people to receive the treatment that they needed. By 1927 the AMA estimated that the national healthcare spending was at 4% of the national income (Gorman, 2006). Their solution to this problem was to increase the amount of resources going into the medical community. During the 1920s there was also an increase in the physician’s incomes and prestige was established for the physicians (“Healthcare Crisis”, n.d.). With all the innovations, discoveries, and the growing economy, the 1920s was a perfect time for the Cleveland Clinic to join the medical