History of Health Insurance in the US: Part III

The battle continues.

• The New Dealers attempts for national health insurance was dealt a final death blow in 1939 with the defeat of the Wagner Health bill by the U.S. Congress.
• The outbreak of World War II buried the issue of national health insurance for the time period.
• The National War Labor Board (NWLB) freezes wages to head off labor disputes so employers offer health insurance coverage as a means to attract workers.
• Between 1945 and 1952, President Truman attempts to pass legislation for federally funded medical care but can only block legislation that would have required a poverty test for those seeking insurance aid and legislation that would have expanded the influence of the Blue Cross Blue Shield system.
• During the Eisenhower administration hospital and medical costs rose at a rate that created public pressure for federally funded relief. The AMA agreed to work with the Eisenhower administration to relieve the situation. As a result, in 1960 the Kerr-Mills bill passed which provided funding to the states to assist with the health costs for the elderly.
• In 1961, the AMA helped to defeat the King-Anderson bill which would have paid for hospitalization for the elderly through the Social Security system.
• John Kennedy included federally funded health insurance in his New Frontier programs but he was defeated in Congress.
• In 1964, President Johnson too was defeated in his attempt to pass his hospitalization program.
• A change in the makeup of Congress in 1965 created a climate that allowed for passage of Medicaid and Medicare.

To learn more about the history of health insurance in the United States, click here and here.

Our history of health insurance is not a pretty one. For the most part, the patchwork of programs and plans that we have today is the result of organizations with different agendas having control at different times. These organizations for the most part represent two camps. One that desires profit and another that desires comprehensive universal coverage.

Rather than “do the right thing” our leaders in business and politics have done their thing. It’s time to agree on the definition of the “right thing” and make it happen.

The History of Health Insurance in the US: Part II

Part II takes us through the passage of the Social Security bill in 1935. Social Security was intended to be “social security” including unemployment insurance, a national health plan, national health insurance, accident and disability insurance, old age pensions, and industrial accidents insurance. It never materialized to be true social security because of opposition from so many groups such as the AMA. Roosevelt only presented to Congress what he knew would be accepted. Unfortunately Congress didn’t have the same strength-of-character that Roosevelt had.

• By 1917 most medical professionals and agencies supported the need for health insurance legislation at the federal level. There was also opposition from sectarian groups because they were excluded and pharmacists who thought it would cost them business while they would have to contribute to their employee’s health insurance.
• In 1917, the president of the American Federation of Labor (AFL), Samuel Gompers, stated before the U.S. House of Representatives that when it came to federally funded health insurance, workers would rather rely on themselves than the government. He actually said that federally funded health care would promote workers to leave jobs because they would be guaranteed insurance wherever they worked.
• At the same time, many of the private health insurance companies formed the Insurance Economics Society of America which blocked passage of any health insurance legislation.
• The gains of the AALL were halted in 1917 by our participation in World War I.
• Opponents of mandatory federal health insurance used the rising tide of anti German sentiments to stop all legislation by claiming that federal health insurance was a German concept and should be avoided at all costs.
• The outpouring of anti German sentiment, fear of anything sounding like socialism, and higher physician incomes prevented any growth in federally funded health care through the 1920’s.
• The depression in 1929 started a steep decline in hospital receipts and physician incomes and a renewed interest in health insurance within the medical community.
• In 1929, the first modern group health insurance plan was established. Justin Ford Kimball, vice president of Baylor University in Waco, Texas, headed the Baylor College of Medicine, School of Nursing, College of Dentistry, and the university hospital. He developed a health plan that guaranteed teachers 21 days of hospital care for 50 cents a month. This became the prototype for the Blue Cross plans.
• In 1934, the cross symbol was first used in an advertisement for the Hospital Service Association, today known as Blue Cross and Blue Shield of Minnesota.
• In 1939, the Chicago-based American Hospital Association began using the Blue Cross symbol to signify that health plans across the country met certain standards.
• The Blue Shield concept grew out in the lumber and mining camps of the Pacific Northwest about the same time Justin Ford Kimball, vice president of Baylor University, created his plan. The plan would provide medical care by paying monthly fees to medical service bureaus composed of groups of physicians.
• The Blue Shield symbol was created in Buffalo, New York by Carl Metzger in 1939, and the first official Blue Shield plan was founded in California that same year.
• In 1935, the Social Security Act is passed but national health insurance is omitted.