In the wake of the assassination of UnitedHealth CEO Brian Thompson, Americans are wondering out loud why we’re getting ripped off by giant insurance companies when every other developed country in the world has healthcare as a right and pays an average of about half of what we do — and gets better outcomes.
As I point out in The Hidden History of American Healthcare: Why Sickness Bankrupts You and Makes Others Insanely Rich, and brought up with Joy Reid on her program last week, America is:
— The only developed country in the world that doesn’t recognize healthcare as a human right,
— The only country with more than two-thirds of its population lacking access to affordable healthcare and a half-million families facing bankruptcy every year because somebody got sick,
— The only country in the developed world where over 40% of the population carries $220 billion in medical debt,
— And the only country in the developed world that has, since its founding, enslaved and then legally oppressed and disenfranchised a large minority of its population because of their race.
These things, along with UnitedHealth’s $370 billion in revenue and $32 billion in profit, are connected.
Roughly 60 percent of Americans would have had to take out a loan or otherwise borrow or beg for money to deal with a single, unexpected $1,000 expense.
Yet annual family medical copays and out -of-pocket deductibles averaged $6,575 in 2023, when the Kaiser Family Foundation did a comprehensive survey of Americans. This strikes minorities particularly hard, which, it turns out, is not an accident.
The simple fact is that, were it not for slavery, white supremacy, and the legacy of “scientific racism,” America would have had a national, single-payer healthcare system in 1915, just 31 years after Germany put into place the modern world’s first such program.
At the center of the effort to prevent a national healthcare system — or any form of government assistance that may even incidentally offer benefit to African Americans — were Frederick Ludwig Hoffman and the Prudential Life Insurance Company, which promoted his “science based” racial theories to successfully fight single-payer health insurance.
Racism is the main reason that America doesn’t consider healthcare a human right and provide it to all citizens, in contrast to every other developed country in the world. Racist whites, particularly in the South, have worked for over a century to make sure that healthcare is hard for Black people and other minorities to get.
And their biggest ally, their founding spokesperson in the post–Civil War era, their biggest champion right up to the 1940s, was a man that most Americans have never heard of.
In 1884, 19-year-old Frederick Ludwig Hoffmann left Germany for America after failing at a number of job attempts and being rejected for the German Army because he was “physically deficient” and frail, standing five-foot-seven and weighing a mere 110 pounds. He arrived in New York with $4.76 in his pocket, speaking “not a word of English” but determined to prove wrong his mother’s assessment that he was a “good-for-nothing.”
From this humble beginning, Hoffmann went on to become one of America’s most influential statisticians and analysts of public health, making numerous consequential discoveries about how industrialization was killing American workers.
He dropped the last n in his last name, became so fluent in English that his accent was nearly indistinguishable, and married into an upscale Georgia family. By 1920 he was an American citizen, vice president of America’s largest insurance company, and a national authority on the now-discredited pseudoscience called scientific racism.
In 1908, his article “The Mortality from Consumption [tuberculosis] in the Dusty Trades,” published by the US Department of Labor, produced the first national efforts to reduce lung damage in the workplace. He also published the first work (1915) linking tobacco to lung cancer.
From this, he became vice president of the National Tuberculosis Association (today known as the American Lung Association) and later demonstrated the connection between exposure to asbestos and the disease that killed my father, mesothelioma (a bit of data that asbestos companies worked to keep hidden for the next 80 years).
But Hoffman’s most controversial lifelong obsession was with the relationship between disease, race, and society.
On one of his first trips to Georgia, he wrote, he came across a book by Dr. Eugene R. Corson, a Georgia obstetrician, titled The Vital Equation of the Colored Race and Its Future in the United States. It was apparently an updated or shortened version of Corson’s widely read “The Future of the Colored Race in the United States From an Ethnic and Medical Standpoint,” published in 1887 in the New York Medical Times.
This was just after the failure of Reconstruction, and a widespread topic of speculation, particularly in the South, was whether Black people would soon outnumber white people in that part of the country.
The Ku Klux Klan and others calling for wholesale slaughter and suppression of Black people claimed that they were more likely to have larger families because they were “more prolific,” code for “excessively sexual,” a charge that had persisted from the earliest days of slavery and led to the murder of Emmett Till (among others).
However, the “scientific” racists of the day, like Corson, thought differently. Corson led a movement suggesting that people of African ancestry, now lacking “the protective womb of slavery,” would die out for the simple reason that the Black race was “inferior to whites.”
Corson promoted the Klan’s argument that “the simpler the organism, the simpler the genesis and the greater the prolificness.” But, he said, white people would prevail because they were less likely to die of disease, citing Herbert Spencer’s Theory of Population Deduced from the General Law of Animal Fertility.
While Black people might have more children, Corson wrote, white people would still outnumber them because Black fecundity “is more than compensated for by the ability [of white people] to maintain individual life.”
Enslaved people from Africa had found themselves in a civilization “of which [they are] not a product” and thus were less likely to be successful in “the struggle for existence.” Therefore, Corson wrote, Black people “must suffer physically, a result which forbids any undue increase in the race.”
The discovery of this theory, called the racial extinction thesis, electrified Hoffman, and he spent the rest of his life promoting it, while campaigning to stop any sort of movement toward a national health insurance program that might prevent or slow down the extinction of Black people in America.
In August 1896, the American Economic Association published a book that represented a turning point in Frederick Hoffman’s life and sealed the fate of single-payer health insurance in America. It was Hoffman’s magnum opus, summarizing decades of compiled statistics on Black versus white mortality, proving, according to Hoffman, once and for all, that for Black people, “gradual extinction is only a question of time.”
In Race Traits and Tendencies of the American Negro, Hoffman set out not only to repeatedly make and statistically prove the above claim, but also to prove that anytime white people tried to help Black people, particularly by offering them healthcare services, the result was disaster for both.
Noting that “the Negro has failed to gain a foothold in any of the northern states,” Hoffman wrote, “he is in the South as a permanent factor . . . with a tendency to drift into the cities, there to concentrate in the most undesirable and unsanitary sections . . . and the evil effect will be more felt by the cities which are thus augmented in population of an undesirable character.”
In great detail, Hoffman spent about 300 pages documenting, with exhaustive tables and statistics, the fact that Black people were more likely to die as a result of everything from malaria to tuberculosis to childbirth.
And it was all because of their race, Hoffman argued:
“The decrease in the rate of increase of the colored population has been traced first to the excessive mortality, which in turn has been traced to an inferior vital capacity. . . . This racial inferiority has, in turn, brought about a moral deterioration . . . sexual immorality . . . diminished social and economic efficiency . . .”
And that represented a danger to white people, Hoffman wrote.
The participation of freed Black people in the contemporary labor pool and in society overall, he wrote, “in the course of years must prove not only a most destructive factor in the progress of the colored race, but also in the progress, social as well as economic, of the white race brought under its influence.”
Slavery had actually been good for Black people, Hoffman believed, and the abolition of slavery at the end of the Civil War was only going to speed up the demise of that race.
“Nothing is more clearly shown from this investigation,” he wrote, “than that the southern black man at the time of emancipation was healthy in body and cheerful in mind. He neither suffered inordinately from disease nor from impaired bodily vigor.”
But with abolition, formerly enslaved people were “tending toward a condition in which matters will be worse than they are now, when diseases will be more destructive, vital resistance still lower, when the number of births will fall below the deaths, and gradual extinction of the race will take place.”
While Hoffman pioneered linking causal conditions such as asbestos and carcinogen exposure to sickness, he was so blinded by racism that a modern reader of his book constantly finds himself shouting, “But these things are also true of poor whites! These are caused by discrimination and poverty!!”
At the time, though, the vast majority of white Americans agreed with him. He was echoing the white cultural and scientific consensus of the late 19th and early 20th centuries when he wrote:
“Given the same conditions of life for two races, the one of Aryan descent will prove the superior, solely on account of its ancient inheritance of virtue and transmitted qualities which are determining factors in the struggle for race supremacy. The lower races, even under the same conditions of life, must necessarily fail because the vast number of incapables, which a hard struggle for life has eliminated from the ranks of the white races, are still forming the large body of the lower races.”
And, according to Hoffman and the other white “scientific racists,” the problem wasn’t just physical inferiority. The deepest “problem of the Negro,” Hoffman wrote, was moral:
“All the facts prove that a low standard of sexual morality is the main and underlying cause of the low and anti-social condition of the race at the present time. . . . The conclusion is warranted that it is merely a question of time when the actual downward course, that is, a decrease in the population will take place. In the meantime, however, the presence of the colored population is a serious hindrance to the economic progress of the white race.”
For those well-intentioned white people who wanted to help out the people who were a mere generation or two away from slavery, Hoffman and his colleagues had one simple bit of advice: Don’t even try.
In 1980, David Koch famously ran for vice president of the United States under the banner of the Libertarian Party, an organization founded a few decades earlier by big business to give an economic rationale and political patina to their simple theory that economics were more important than democracy, and the quality of life of working people should be decided in the “free marketplace” instead of by unions or through democratic processes via government regulation.
In this, Koch and his Libertarian friends were echoing Frederick Hoffman.
In his 1896 book Race Traits, Hoffman laid out his “scientific” assertion that when government steps in to help people, it invariably ends up hurting them instead. Not only should there be no government assistance given to help African Americans recover from three centuries of property theft, forced labor, and legal violence, but it is scientifically wrong to even consider the idea.
White people and government programs to better the lives of Black people, Hoffman wrote, deserve “the most severe condemnation of modern attempts of superior races to lift inferior races to their own elevated position.”
The damage done to Black people by offering them any sort of help, government assistance, or even a minimum wage, he wrote, is “criminal” behavior for a “civilized people.”
Hoffman pointed to Native Americans to prove his point:
“Few races have made such a brave struggle for their own preservation; few races can boast of so high a degree of aboriginal civilization. . . . An iron will can be traced upon the countenance of nearly every Indian of note.”
But it was government help, Hoffman wrote, that destroyed the American Indian.
It wasn’t “adulterated whiskey nor the frightful consequences of sexual immorality, spread around the forts and settlements of the whites,” that was “sufficient” to destroy Native Americans. It was charity.
“The most subtle agency of all,” he wrote, sounding like Ronald Reagan or David Koch, “governmental pauperism, the highest development of the theory of easy conditions of life, did what neither drink nor the poisons of venereal disease could do, and today the large majority of the tribes are following the Maories and Hawaiians towards the goal of final extinction.”
White Americans rationalized their brutality toward Native Americans and African Americans by saying that it was simple evolutionary biology: only the strong survive, and when the weak are allowed to propagate, it weakens the overall human race.
“Easy conditions of life and a liberal charity are among the most destructive influences affecting the lower races,” Hoffman concluded, “since by such methods the weak and incapable are permitted to increase and multiply, while the struggle of the more able is increased in severity [by the increase in taxes and regulation].”
And it’s not just charity.
“All the facts prove,” Hoffman wrote, “that education, philanthropy, and religion have failed to develop [among Black people] a higher appreciation of the stern and uncompromising virtues of the Aryan race.
“Instead of making the race more independent, modern educational and philanthropic efforts have succeeded in making it even more dependent on the white race at the present time than it was previous to emancipation.”
Free education — as any Libertarian can tell you — is more dangerous to the souls of people than slavery. And free healthcare is even worse.
Sounding like a modern-day acolyte of Ayn Rand, Hoffman wrote:
“Instead of clamoring for aid and assistance from the white race, the negro himself should sternly refuse every offer of direct interference in his own evolution. The more difficult his upward struggle, the more enduring will be the qualities developed.”
And, like Ayn Rand, David Koch, and Ronald Reagan, Hoffman believed that these were eternal truths independent of race:
“No missionary or educator or philanthropist extended aid or comfort to the English peasant class during its darkest days, to the earliest settlers on the coast of New England, or the pioneer in the forests of the far West. . . . [I]t is extremely rare to find a case where easy conditions of life or liberal charity have assisted man in his upward struggle. Self reliance . . . must be developed, and thus far have not been developed by the aid of charity or liberal philanthropy.”
This libertarian ideal is still pervasive in our modern fragmented healthcare system, and in the midst of the COVID-19 crisis in 2020 it resulted in thousands of daily American deaths, disproportionately hitting racial minorities.
The “compulsory health insurance” (what today we’d call Medicare for All) movement of the early 20th century was as much (and possibly more) about getting paid sick leave as it was about covering doctor visits and hospitalization, because healthcare was so cheap that an unpaid week at work was a bigger hit to the wallet.
But workers wanted both.
The most successful effort of the era came out of an organization that a small group of progressive economists put together in 1905 and 1906, known as the American Association for Labor Legislation (AALL).
Their initial efforts were directed at paid sick leave, workers’ compensation insurance, child labor laws, and workplace safety standards. To that last end, they were actively using the kinds of statistical analysis that Frederick Hoffman had both used and popularized to do everything from laying out his theories on race to showing an association between tobacco use and lung cancer.
Hoffman joined the AALL to promote their efforts…at least that was his claim.
A charitable reading of his motivations was that his statistical research on workplace phosphorus poisoning and lung disease overlapped with their efforts, and they were an organization that, at that time, was held in high regard. He did, after all, consider himself — and was, in a very real way — a major force for reform in public health and workplace safety arenas.
A less charitable motivation is posited in Daniel T. Rodgers’s 1998 book Atlantic Crossings: Social Politics in a Progressive Age. Rodgers wrote:
“On the AALL social insurance committee, he became the [Prudential] company’s mole. . . . Hoffman took credit for blocking the drafting of any resolutions at the AALL’s social insurance conference in 1913. During the framing of the association’s model health insurance bill, he dragged his feet, obstructed, pressed in vain for company initiatives in the medical insurance field, and informed his employers — more and more certain that public health insurance was ‘distinctly pernicious and a menace to our interests.’”
Despite Prudential and Hoffman’s efforts, government-funded health insurance was gaining popularity in America (and being adopted across Europe).
In 1912, Theodore Roosevelt made a third-party bid for the presidency, forming the Progressive Party (with its Bull Moose logo), and called for “the protection of home life against the hazards of sickness, irregular employment and old age through the adoption of a system of social insurance.”
Jane Addams (Hull House founder), dressed in suffragette white, seconded Roosevelt’s nomination to wild cheers and applause; Roosevelt rallies routinely drew tens of thousands of people, and more than 200,000 people showed up in Los Angeles to support him and the party.
Roosevelt’s endorsement of “social insurance,” including health coverage, both reflected and reinforced a growing national sentiment, and in 1915 the AALL called for every state to support a program of health insurance. Prudential hadn’t yet gotten into the business of insuring health (they would in 1925), but they could see the writing on the wall.
In 1916, the AALL endorsed health insurance provided through a network of local and statewide mutual companies and called for those policies to also provide a small death benefit to cover funeral costs, which would have competed directly with the funeral coverage that was Prudential’s main cash cow.
Hoffman wrote to the company, “We, of course, cannot compete with Compulsory Insurance, including a death benefit of, say $100.” He then resigned “in disgust” from the AALL and began a campaign, sponsored by Prudential, to stop state-funded health insurance.
Hoffman and Prudential weren’t alone in their concern: the Insurance Federation of New York told their members:
“This is only the entering wedge; if once a foothold is obtained it will mean attempts to have such State Insurance of all kinds...”
The AALL produced model legislation that was taken up in 1916 by eight states, including California and New York, the former via a ballot initiative and the latter in the New York legislature. In addition to calling for policies that would pay all costs of healthcare, the AALL’s legislation called for up to 26 weeks of paid sick leave.
Picking up steam, the American Medical Association endorsed the AALL’s model legislation as well. The battle was joined.
Hoffman’s Prudential-sponsored campaign to prevent any state from adopting a statewide nonprofit health (and death benefit) insurance program went into overdrive through 1916–1920. He traveled to Germany several times to chronicle, in minute detail, the failings of the kaiser’s system that had been operating since 1885.
Prudential, in 1905, had been swept up in New York’s Armstrong Investigation, and so, as historian Beatrix Hoffman (no relation to Frederick) wrote, “[b]ecause of their industry’s public image problems, insurance executives knew their opposition to compulsory health insurance would be perceived as brazen self-interest.”
They needed a front man, and the guy who was famous for discovering the causes of numerous public health crises was perfect. Thus, Frederick Hoffman became the most well-known face of a massive, multiyear effort to stop the AALL’s campaign. He was remarkably effective.
In the years between 1916, when he resigned from AALL, and 1920, when nonprofit state-funded health insurance finally died, Hoffman wrote numerous pamphlets trashing the German single-payer government health system, “exposing” corruption in the British efforts at a National Health Service, and arguing that America’s healthcare system would be thrown into chaos and crisis if the AALL’s programs were adopted.
His work was widely distributed, as historian Daniel Rodgers noted: “The Prudential saturated the state capitols with his pamphlets.”
His 1917 pamphlet Facts and Fallacies of Compulsory Health Insurance, and the subsequent More Facts and Fallacies of Compulsory Health Insurance, published two years later, were his most widely cited and most consequential writings.
Historian Beatrix Hoffman wrote that the Facts pamphlet “resembled Race Traits and Tendencies in its impressive presentation of statistics and graphs alongside passionate polemics.” Frederick Hoffman refuted every figure the Progressives used in defense of their plan, from “Misleading Data on German Longevity” to “Misleading Estimate of Cost” and “Disregard of Actuarial Methods.”
Appealing to the Daniel Boone mythos of rugged, independent individualism that didn’t require assistance from government, Frederick Hoffman wrote in More Facts and Fallacies of Compulsory Health Insurance:
“The ever-present menace to democracy and liberty is the perversion of the legislative function [toward providing health insurance].”
Hoffman’s writing and speeches shook America’s political systems, particularly as this German-born “man of science” warned of the dire consequences to American liberty and democracy represented by universal health insurance.
In 1918, John R. Commons — one of the AALL’s cofounders — wrote that almost all the nation’s anti–compulsory health insurance propaganda “originates from one source; all of the ammunition, all of the facts and statistics that may come across, no matter who gives them to you, will be found to go back to the Prudential Insurance Co. of America, and to Mr. Frederick L. Hoffman.”
Prudential paid to transport Hoffman all across America, from media events to congressional hearings to a trip to England to document the horrors of their National Health Service system, which had gone into effect in 1911.
He wrote from London, in a widely read paper, that because of the British National Insurance Act, “The fine spirit of the English working classes, at one time the finest people of that type in the world, is gone, entirely gone.”
Historian Beatrix Hoffman wrote:
“His agitation was tireless, his influence widespread. . . . His reputation as an expert allowed Hoffman to participate in the deliberations of the health insurance commissions of Illinois, Wisconsin, and Connecticut, and to successfully persuade commission members to vote against the plan.”
In 1920, in large part because of Prudential’s efforts and Hoffman’s warnings, California’s voters resoundingly turned down a voter initiative in that state to provide health insurance, and, although New York’s Senate passed the bill, it died in committee in the Assembly.
While the AALL continued to campaign for state-funded health insurance until their dissolution in 1946, they never again gained enough traction to get their proposal before any state legislatures or the US Congress.
Having succeeded in killing state-funded health insurance, Hoffman, in the later 1920s, turned his attention back to his theory that Black people would eventually die out, joining the Eugenics Research Association (whose work was later used by Hitler to justify racial separation and his “final solution”).
In 1929, Hoffman asserted, in the African American publication Opportunity, that “the white race is almost solely responsible . . . for the health progress which the South has made during the last generation” and that Black people moving in large numbers into cities would “lead to a thoroughly unwholesome state of affairs which unquestionably will express itself in course of time in a lower birth rate and a higher death rate.”
Hoffman’s influence lasted long past his death in 1946 (which satisfied his stated desire to live long enough to see FDR out of office). As late as 1984, according to reporting in the Wall Street Journal, Prudential was still collecting premiums from African Americans that were “in some instances more than a third higher” than those paid by whites.
We even see an echo of it in the opposition of southern white racist Senators to Medicare in 1965, arguably leading to the 20% hole in that system that requires MediGap policies to fill.
Were it not for “scientific racism,” America would have long ago joined the rest of the developed world with a competent and efficient national healthcare system. Instead, we’re stuck with for-profit health insurance giants sucking our blood like giant leeches attached to our backs.
NOW READ: Inside the DOGE billionaires' plan to kill Medicare