Palo Alto Centennial
Publication Date: Wednesday, April 13, 1994

Medicine in the '30s: a different way

by Don Kazak

Dr. Milt Saier remembers meeting Dr. Russel Lee for the first time in the hallway outside the operating room in the brand-new Palo Alto Hospital. The year was 1931.

Lee had started an informal partnership with three other doctors a year or so before, which also would soon have its own new building and a new name--the Palo Alto Medical Clinic. The problem was that the workload for the four doctors had grown heavy enough that they needed another doctor. So Lee talked Saier into joining the young partnership.

Dr. Saier was thus the fifth of the original founding partners of the clinic. He joined a team that included Lee, Esther Clark, Edward Frederick (Fritz) Roth, and Blake Wilbur, son of physician and then Stanford University President Dr. Ray Lyman Wilbur.

Lee and Saier had no way of knowing at the time that the clinic they founded would become one of the largest and most innovative group practices in the country, or that the modern, five-story Palo Alto Hospital would be a precursor to one of the most prestigious hospitals in the world, Stanford Hospital.

The former Palo Alto Hospital, off Palm Drive near El Camino Real, is still in operation as Hoover Pavilion at Stanford Hospital. And the Palo Alto Medical Clinic building constructed in 1931, known as the Roth Building, still is part of the Palo Alto Medical Foundation. But that may change. The foundation this year filed plans with the city to build an entirely new facility in the Urban Lane area.

In July 1931, when Saier joined Lee and the others, the new clinic building wasn't finished. So the doctors set up shop in a two-story former residential building at the corner of Bryant Street and Hamilton Avenue in downtown Palo Alto, site of the Great Western Bank building.

Saier, who practiced internal medicine, was an allergist, the first between San Francisco and San Jose, so he brought many new patients to the partnership. When Saier started with the group, his "office" was the former kitchen in the second-story apartment of the Bryant-Hamilton building, but the five physicians soon moved into the new clinic building.

Although the country was in the midst of the Great Depression, the 1930s was far from a bad time to practice medicine. The only thing the Depression affected "was how much we made, not how much we did," Saier said in an interview with the Weekly in 1988. The city had about 15,000 or so people then, and the type of medicine that was practiced was far different from today.

"You knew everyone you took care of," he said. "It was a family way of doing things. It was wonderful." Back then, night house calls were part of being a doctor, and Saier said patients could easily reach him by calling the clinic during the day or his home at night.

The clinic was innovative in several ways. At the time, group practices represented a radical idea that wasn't uniformly popular among other physicians. There was some resentment among members of the Santa Clara County Medical Society, although Saier says those tensions weren't as great as sometimes reported. "The other doctors didn't seem to mind," he said.

At the clinic, decisions were made informally by the partners sitting around a table. Lee, the driving force behind the clinic, had a unique way of determining how much each doctor earned--he let them name their salaries. Lee would tell them to write down how much they wanted to make in the coming year. In a few cases, Lee had to give them more then they asked for because their requests were too modest.

"We got along well," Saier said of the clinic's founding partners. "We were pretty much a Stanford group of doctors."

The hospital was subsidized by the city. The city had purchased an older private hospital in 1921 with funds raised through voter-approved bonds, and entered into an agreement with Stanford University to operate it. When the wooden hospital on Embarcadero Road was outgrown by the city's needs, voters passed a second bond measure in 1929 to build a hospital on Stanford land that would be operated by the university under a 99-year agreement with the city.

In November 1934, the City Council voted to subsidize Palo Alto residents to the tune of $2.50 per day toward the cost of hospitalization, then about $5 per day. At the time, clinic patients were charged $3 per office visit, $4 for a house visit, and $10 for a night house call.

During the Depression, both the clinic and the city helped local residents financially. The clinic's doctors either didn't charge for some visits, didn't charge much or didn't worry about collecting the bills.

After the war brought prosperity back to the area, a funny thing happened. Unasked, people began coming in to pay bills owed for eight and 10 years, bills recorded in books that had been buried away in the basement of the clinic and forgotten.

It's kind of hard to imagine something like that happening today, but those days were different. "It was more personal then," Saier remembers. "It was the best medicine you could practice."