History of Health Reform: Where We Started, Where We’re Heading
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History of Health Reform: Where We Started, Where We’re Heading

Mar 17 2017

Health care reform may seem like a relatively new idea.

But, in reality, the ideas behind health care reform in the United States and the various associated proposals have been a topic of debate for more than a century.

The real start to the national health insurance debate happened in the 1930s with President Franklin D. Roosevelt’s New Deal program.

Starting as far back as 1912 with President Teddy Roosevelt’s endorsement of social insurance, people have been debating how to approach health care. In 1915, Progressive Party reformers campaigned for a state-based system of compulsory health insurance, but were unsuccessful.

The real start to the national health insurance debate happened in the 1930s with President Franklin D. Roosevelt’s New Deal program. Yet, the push for retirement benefits and unemployment insurance outweighed national health insurance at the time, which was intentionally left out of the Social Security Act for fear it would weaken the bill. However, the Social Security Act did provide matching funds to states for expanded public health and maternal and child health services, starting the path toward national health insurance.

Moving forward to the late 1940s, the United States was coming out of World War II and President Harry S. Truman called upon Congress to pass a national program that would promise the right to medical care, part of his “Fair Deal” agenda.

Truman’s proposed plan was a single insurance system that would cover all American’s with public subsidies to support low income individuals. This plan, ultimately, did not move forward because there was concern that it would result in hospital desegregation, a huge topic at the time, meaning patients would no longer be separated by race.

During this time, businesses and labor unions began using private, employer-based health insurance that still exists today.

In the early 1960s, the elderly and poor populations became the focus for health reformers bringing forth Medicare and Medicaid. This was the beginning of Original Medicare which included hospital and medical coverage for individuals age 65 and older. Medicaid, on the other hand, gave states the option of receiving federal funding to provide medical insurance to low-income individuals receiving cash assistance. Both Medicare and Medicaid were incorporated into the Social Security Act in 1965.

During the 2008 election, both major party candidates pushed for comprehensive health care reform.

Throughout the 1970s, inflation and rising health care costs became a growing concern and resulted in more health care reform proposals. Two notable plans were Senator Ted Kennedy’s bipartisan national health insurance bill and President Richard Nixon’s Comprehensive Health Insurance Plan (CHIP). But the competition of multiple proposals, the complicated legislative process and the Watergate scandal overshadowed any opportunity for health reform during this time. While health care cost containment continued to be a priority under President Jimmy Carter, health care reform proposals failed to make much headway in the face of economic recession.

From 1992 to 1994, people began to worry about losing their health benefits and more plans surfaced including President Bill Clinton’s Health Security Act. This act called for universal coverage, employer and individual mandates, competition between private insurers, all to be regulated by the government to keep costs down. President Clinton’s plan did not pass through Congress.

During the 2008 election, both major party candidates pushed for comprehensive health care reform. In 2009, the House and Senate started working on legislation and in February 2010, President Barack Obama released his proposal for health care reform, bringing together elements passed in both chambers of Congress. A month later, President Obama signed the Patient Protection and Affordable Care Act. This statute ruled that all individuals are required to have health insurance beginning in 2014. This act outlined that:

  • The lowest income individuals would be covered under Medicaid expansion.
  • Those with low and middle incomes who do not have access to affordable coverage through their jobs will be able to purchase coverage with federal subsidies through new “American Health Benefit Exchanges.”
  • Individuals who do not secure health coverage would be required to pay a penalty.
  • Employers are not mandated to provide health benefits, however large businesses whose employees receive insurance subsidies will pay penalties.
  • Small businesses will be able to access more plans through a separate exchange.
  • Health plans will not be allowed to deny coverage to people for any reason, including their health status, nor can they charge more because of a person’s health or gender.
  • Young adults will now have the option of being covered under their parents’ plan up to age 26.
  • All plans must include 10 essential health benefits.

This brings us to the recent election of President Donald Trump and the latest round of health reforms. The American Health Care Act (AHCA) is the most recent proposal that is circulating Congress. The AHCA does not repeal the ACA as a whole but instead dismantles many of its components, including the mandates and many of the taxes.

Health care reform is not a new topic as the idea has been around for over a century. It’s important to understand where health care reform has been in order to understand what’s next.

To stay informed of upcoming announcements, proposals and changes, sign up to receive Priority Health’s health care reform alert updates.

*Editor’s Note: On Friday, March 24, House leadership pulled the American Health Care Act (AHCA) from consideration on the floor of the U.S. House of Representatives. As a result, the scheduled vote on the AHCA did not take place and the Affordable Care Act remains the federal law that governs the nation’s health care system.

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