Evening star., 1937-11-06
PARLEY TO DECIDE
ON LEGAL STATUS
OF GROUP HEALTH.
Garnett and Seal to Thresh
Out Association Law
Compliance Question.
GROUP DISQUALIFICATION
LICENSING is ORDERED
Corporation Counsel Holds Home
Loan Bank Enterprise Engaged in
Medical Practice or Insurance.

District Attorney Leslie c. Garnett
and Corporation Counsel Elwood H.
Seal are scheduled to confer Mon
day at 10 am. to determine finally
whether Group Health Association,
Inc. now is in compliance with law,
or what steps it must take to meet
legal rules.
The conference was called after Mr..
Seal-at the end of a day of thumbing
through legal records-announced he
had decided the association either was
e corporation engaged in the practice
OF medicine or was corporation en-
gagged in insurance business.
Mr.. Seal also revealed that his office
had advised another group health as
sociation, Group disqualification, Inc,
that it was engaging in the insurance
business and must be licensed by the
District Insurance Department and
must maintain capitalization and a
reserve of considerable" sums.
Hit by Medical Group.
Revelations of the interests of the
District Government in the two cases
came yesterday after the subject was
discussed at meeting of the District
Medical Society, which this week ap-
proved report by the American Med
ical Association holding that the
Group Health Association, Inc, was
system in which a corporation was
Illegally" engaged in the practice of
medicine.
The question of "socialized medi-
cine" has been agitated here since
last February "a, when the incorpora-
tion papers of the G. H. A. were filed
with the District Recorder of Deeds.
MIR. Seal acted yesterday on a request
from Health Officer George C. Ruh-
land for an opinion on the operations
Of the G. H. A. 1t was said last night
this request was filed August Is.
Jurisdiction Hangs on Decision.
After studying the corporation pa
pers and legal records, Mr.. Seal stated:
1T is my belief that the Group Health
Association either is a corporation
engaged in the practice Of medicine or
that it is engaged in the insurance
busineSs-one or the other. If it is
decided finally that it is case Of a
corporation engaging, or offering to
engage, in the practice of medicine,
then the course of action to be taken
must be determined by the District
Attorney. If it is finally determined
that 1t Is case of corporation en-
gaging in the insurance business, then
the decision will be up to me, as legal
adviser of the Commissioners. If
this is the case, then the association
must obtain a license from the Dis
trict Insurance Department and must
maintain the necessary legal reserves,
or it will face prosecution"
Already Doing Business.
The G. H. A. now is open to en-
ployes Of the Federal Home Loan
Bank Board and affiliated agencies,
and their families, but the charter of
the corporation, according to Mr.. Seal,
leaves the door open to other Federal
employees, whose families also could
partake of the services of the medical
staff of the corporation.
While the association service is to
be placed on a self-supporting basis
later, it now is receiving a subsidy
from the United States.
Spokesmen for the G. H. A. said
yesterday that legal advisers for the
F. H. L. B. B. had studied legal ques-
tions and had decided the corporation
was not an insurance company but
merely corporation engaged in SELL
ing service.