Palo Seco Leper Colony

Colonia para Leprosos de Palo Seco

Below are the catalog entries of all known tokens relating to the Palo Seco Leper Colony. This leprosarium was located in the Canal Zone in Panama. These entries are part of the larger catalog for Panama Tokens which lists all known commercial and private tokens related to Panama or the Canal Zone. Please me if you have any additional information you would like to share.

Establishment of Palo Seco

The Palo Seco Leper Asylum was established on April 10, 1907. In 1904 the United States of America and the new Republic of Panama ratified the Panama Canal Treaty. By that treaty the United States became responsible for the public health of the Canal Zone, and to a certain extent the public health of Panama City and Colon. This responsibility had been sought by the United States in order to effectively combat the diseases of yellow fever and malaria which had contributed greatly to the failure of the French attempt to build the canal. The American doctors in 1904 discovered a group of 13 outcasts suffering from Hansen's disease (leprosy) were living precariously on a beach near Panama City. A financial arrangement was made with the Panamanian government, whereby the United States would provide for the housing, food and care of any Panamanian lepers in exchange for 75 cents a day per patient. The group was temporarily moved to Empire. Funds were allocated in 1905 and the Palo Seco facility was opened in 1907.

Palo Seco (the name means "Dry Stick" in Spanish) was an ocean-side 500 acre fruit farm about six miles from Panama City. The fruit farm was isolated, and initially access was only by boat (even though it was part of the mainland). In order to be more homelike, the facility was built like a Panamanian village. It had a plaza with a chapel one one side and the dwelling houses on the other side of the plaza. It was surrounded by trees, which also grew among the buildings.

The lepers were allowed to eat at a mess the food prepared for them or to draw their ration uncooked and do their own cooking. If they wished to do any farming, implements and seeds were provided. The produce was purchased by the facility for the use of the colony. Similarly, they were allowed to raise chickens.

The following excerpts are quoted from Dr. William Gorgas, writing in his book Sanitation In Panama in 1915:

"Another sanitary precaution that the Health Department determined upon was the segregation of lepers... We established a colony on a beautifully located peninsula running out into the bay of Panama, and almost as isolated as if were on an island. Here they could have gardens, chickens, fruit-trees, etc. The location is naturally one of the prettiest on the bay. We now have there some fifty lepers who are living contented and happy... Dr. Henry R. Carter devoted a great deal of time and attention to the establishment of this colony, and it was due to his painstaking personal care that the matter turned out so successfully."

Growth and Change

Over time as people heard good reports about Palo Seco, more people suffering from Hansen's disease came out of hiding and petitioned to join the colony. Around 1945 Palo Seco reached its peak of 127 patients, which included 10 Americans. In 1965 Palo Seco still had 100 patients of which 68 were men and 32 women. The Palo Seco facility was rebuilt in 1938 and 1945, and unfortunately lost that "village" atmosphere. Still it sounded pleasant. The facility built in 1945 was described as follows in the May 1969 issue of the Panama Canal Review:

"Palo Seco was a wind swept quadrangle of nine buildings consisting of living quarters for single patients, each with a room to himself, married patients' apartments, two churches and a building with a kitchen and two dining rooms, one for patients and one for employees. Next door was the administrative office, dental clinic, commissary and storerooms, a hospital to take care of those more seriously ill, and a clinic and treatment room. There was a laundry that could handle 200 pounds of laundry a day and a maintenance shop operated by patients. One of the most important components of the hospital was the recreation building where movies were shown and where patients hold dances and parties, play pool, and entertain friends."

The name of the facility also changed over the years. Palo Seco opened as the Palo Seco Leper Asylum in 1907. A few years later it was known as the Palo Seco Leper Colony In 1948 the name was changed to the Palo Seco Leprosarium. In 1964 the Palo Seco Leprosarium was renamed the Palo Seco Hospital. The Palo Seco Hospital was closed in 1972.

The buildings were used by Catholic nuns to house elderly poor displaced by Operation Just Cause from 1989 to 2000. From 2000 to date I've heard that Palo Seco is the residence of a group of expatriate Americans.

History of the Tokens

In 1919 it was decided that because it was necessary for the Palo Seco patients to handle money to issue a special currency which would be good only at Palo Seco. Outstanding Palo Seco currency was covered by deposits of actual United States currency in the custody of the superintendent. A 1965 letter from Dr. Ezra Hurwitz, Superintendent of the Palo Seco Leprosarium gave the reasons as follows:

  1. The idea of money that has been handled by patients having leprosy was repugnant and the possibility of contagion by this means was thought to be by no means absent;
  2. Patients having ordinary money could buy rum or other prohibited articles from bootleggers, or by other illegal means;
  3. Not being able to accumulate money that is legal outside of the institution was considered to be a deterrent to those wishing to escape.

The tokens have a simple design which says "PALO SECO CANAL ZONE" on the obverse. In view of the name changes over the years, choosing to simply say "PALO SECO" on the tokens this was an excellent choice! The reverse says "REDEEMABLE FOR xx CENTS IN MERCHANDISE". The denomination appears both written out (e.g. "FIVE") and as a number (e.g. "5"). The one cent and five cent denominations are made of brass and have a center square hole. The other four denominations (10 cents, 25 cents, 50 cents and one dollar) are made of aluminum and have a round center hole. Each token is approximately the same size as the equivalent United States coin. Mintage was 2000 of the one cent denomination, and 1000 of each of the other denominations.

Below are some recollections of the daughter of the paymaster who visited Palo Seco:

"My Dad told me that the lepers would carry a string that had a button on one end and a loop on the other that they threaded through the hole in the center of the coins so they could keep them under control. Most of the lepers had horribly disfigured and missing fingers which made handling of the coins difficult for them.

There was a Catholic church at the colony and the lepers would put coins into the collection basket. The nuns that keep the church and linens clean would also clean the coins in alcohol and then present them to the paymaster for U.S. currency on the colony payday."

In 1952 the Palo Seco tokens were withdrawn from circulation. On November 28, 1955 most of the tokens were destroyed by the Maintenance Division in Balboa. Of the $1800.00 in tokens issued, $1492.75 were recorded as being destroyed at that time. Quoting Dr. Ezra Hurwitz again, the reasons were as follows:

  1. It became recognized that leprosy is very mildly contagious and is not likely to be transmitted by the handling of money;
  2. There had been great improvement in the condition of the patients since the introduction of sulfones in treatment;
  3. Silver money is thought to be in itself "self-sterilizing."

The dies used to mint the Palo Seco tokens are still extant. The obverse dies are in one private collection, and the reverse dies in another.

Links for More Information

  • The University of Virginia has an interesting document describing the early history of Palo Seco in their Philip S. Hench Walter Reed Yellow Fever Collection.
  • has photos and short personal stories from patients at Palo Seco (and other institutions).
  • has medical history articles of Panama written in Spanish. I found the Palo Seco articles very informative. There are two articles related to Palo Seco. The first article is the history of Dr. Hurwitz (quoted above) and his wife and their work at Palo Seco. The second article is the general history of the Palo Seco Hospital.


Palo Seco tokens are rare due to the destruction of the majority of the tokens as well as 33 years of circulation. Examples known were probably kept as souvenirs by the few visitors and administrative personnel. They are much sought after by Panama specialists, leprosy specialists and others.

Collecting Palo Seco Tokens

The good news is that the series is small - only six coins. The bad news is rarity and price. I know of at least ten complete sets that have been put together. With patience, luck and about $2000, it can be done. With a smaller budget, you may need to be satisfied with an example of either the one cent or five cent denominations.


Pricing is based on several factors, which ultimately are supply and demand. How many specimens are available and how many collectors want them. With the Palo Seco tokens, the supply is low and the demand is higher than usual for Panama tokens. So a Palo Seco token with 12 examples known is priced higher than another Panama token with 12 examples known. Due to the nature of auctions, similar specimens will sell at very different prices depending on the demand of the moment. This makes it hard to develop an "accurate" catalog value. The values below are my best effort at balancing the various factors.

Numbering System

All the Panama tokens have been designated with the letters "PT", and grouped by issuer and then by type. Each group is given a unique number. Within each group, each piece is given a unique number based on its denomination in cents. I have selected group number 500 for the Palo Seco tokens. Permission is hereby granted to anyone to use the numbers below in referring to these tokens, in print or electronic media, by calling them Plowman's PT-500.xx at least once, or referencing

Click on the image or catalog number below to go to the full listing for that piece.

Palo Seco Leper Colony Tokens
Image # Description Rarity 2007 Catalog Value
Fine Very Fine Extra Fine
PT-500.01 PALO SECO 1 cent C (23) $ 200.00 $ 260.00 $ 400.00
PT-500.05 PALO SECO 5 cents C (21) $ 225.00 $ 300.00 $ 450.00
PT-500.10 PALO SECO 10 cents C (14) $ 250.00 $ 335.00 $ 500.00
PT-500.25 PALO SECO 25 cents C (14) $ 300.00 $ 400.00 $ 600.00
PT-500.50 PALO SECO 50 cents C (13) $ 480.00 $ 600.00 $ 960.00
PT-500.100 PALO SECO 1 dollar C (10) $1500.00 $2000.00 $3000.00