Donald F. Schaller, M.D.

Donald F. Schaller, M.D., of Scottsdale, a founder of one of Arizona's first health plans and the architect of a 1980s turnaround of the Arizona Health Care Cost Containment System, passed away March 13. Dr. Schaller was born June 1, 1925, in Rochelle, Ill., to Dr. and Mrs. C.H. Schaller.


After two years at the University of Illinois, he transferred to the University of Texas, where he graduated with a mechanical engineering degree and chose his commission in the U.S. Marine Corps. Following World War II, he followed his father's footsteps and was accepted to the University of Illinois Medical School in 1950 but was called back into the Marines. He saw action in Korea as a lieutenant and received a Purple Heart for a shrapnel wound.


Following the war, he resumed his medical education and graduated from the University of Illinois in 1956. Dr. Schaller came to Arizona for an internship at Good Samaritan Hospital in 1956 and 1957. He was in private practice in Phoenix until mid-1971, when he co-founded and was medical director of Arizona Health Plan (AHP), one of the state's first health plans which ultimately became part of CIGNA.


AHP's success led former Gov. Bruce Babbitt to appoint Dr. Schaller in 1983 to reorganize AHCCCS, the nation's first statewide Medicaid program based on managed care. With AHCCCS stabilized, Dr. Schaller co-founded Schaller Anderson, Inc., (SAI). Dr. Schaller retired from SAI in 1998 and then focused his attention on his family and hobbies.


His sparkling blue eyes and his snow-white hair and beard made for a perfect likeness of Santa Claus. He had a quirky sense of humor that often bubbled to the surface when least expected.


Dr. Schaller was an early volunteer and First Committee member of the Fiesta Bowl and served as the team physician. He was a renaissance man who had varied interests as an artist, sailor, gardener, builder of model ships and collector of military memorabilia.


His best and longtime memories were of his Kodachrome slides of life that he shot during the war in Korea. Dr. Schaller used the color slides – somewhat rare for the time – to make presentations to veterans groups and school children. Known as "Doc" or "Don," he touched the lives of countless people, most of them unknowingly but all of them better for it. 

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