Henry Kaiser’s Permanente

When I moved to California, I had to refigure how to apply my Medicare benefits. After a couple of false starts, I was pointed to Kaiser Permanente. It seemed to be a better-integrated system — meaning less paperwork.

I’ve been using Kaiser Permanente for several years. Then, while my wife and I were watching our grandson, we visited the Rosie the Riveter National Historical Park in Richmond.

I was amazed to discover that the story of my health-care system had began, in large part, right there.

Richmond sits on an extraordinary deepwater port. During World War II, it became the site of four enormous shipyards built by an industrialist named Henry J. Kaiser.

But Kaiser’s story began long before the shipyards.

Born in 1882 in upstate New York, Kaiser left school after the eighth grade and went to work. He eventually headed west, getting into construction and road building. He had an unusual combination of qualities: enormous ambition, an instinct for publicity, a willingness to take risks and, apparently, an almost boundless confidence that a difficult problem could be solved if you organized people and technology properly.

His breakthrough came during the Depression.

Kaiser became part of the Six Companies consortium that built Hoover Dam. The project was completed in five years rather than the expected seven. Kaiser and his partners went on to major projects including Bonneville Dam and Grand Coulee Dam. His companies became masters of building enormous things quickly.

But Grand Coulee produced an unexpected consequence.

Thousands of workers needed medical care, and the conventional system was expensive and inadequate. Kaiser was introduced to a young doctor, Sidney Garfield, who had already experimented with a radical idea while treating workers on the Colorado River Aqueduct: workers would prepay a small amount for medical care, allowing doctors to concentrate on keeping people healthy rather than simply treating them after they became sick.

Kaiser and Garfield put the idea to work at Grand Coulee. Then came World War II.

Kaiser plunged into shipbuilding, despite having no previous experience in the industry. His Richmond yards became famous for mass-production techniques. Sections of ships were built separately and then assembled, allowing Kaiser workers to produce ships at a breathtaking pace.

But there was a problem. Kaiser needed workers to keep building ships, and many of the people arriving at his shipyards had never had adequate medical care. So Kaiser called Garfield.

The result was the Permanente Health Plan, offering prepaid medical care to Kaiser workers. By 1945, more than 200,000 workers and family members were enrolled. The system emphasized preventive care and group medical practice — ideas that were unusual, even controversial, at the time.

And then there is the name. It turns out “Permanente” was not dreamed up by a corporate marketing department.

Henry and his wife, Bess, owned a lodge near Permanente Creek in Santa Clara County. Early Spanish settlers had called the stream *Ria Permanente* because it flowed year-round, providing a dependable source of water. Bess loved the creek and suggested that Henry use its name for the medical program.

Henry liked what the word suggested: something dependable that endured.

“Permanente” had already become associated with some of Kaiser’s industrial enterprises. Now it became attached to his experiment in health care.

In 1945, as the war ended and Kaiser’s shipyards began closing, Kaiser and Garfield faced a choice: let the medical experiment disappear with the shipyards, or see whether it could work in peacetime.

They chose the latter. On July 21, 1945, the Permanente Health Plan opened to the public. In 1953, it adopted the name we know today: Kaiser Permanente.

Standing in Richmond, I found myself looking at my Kaiser card differently. I had thought I was using a California health-care company.

Instead, I was using the legacy of a man who built roads, dams, cement plants and ships — and who apparently believed that if you could figure out how to build a dam or a ship efficiently, perhaps you could figure out how to organize health care, too.

The ships are gone. The Richmond shipyards are largely history. But the experiment that began there is still treating patients.

~ Al Zagofsky