The Origins of Health Insurance for the Aged (original) (raw)

1973, International Journal of Health Services

The evolution of the movement to enact a program of health insurance for the aged in the United States is examined in this article. The most popular conception of the origins and intent of Medicare is compared with empirical data drawn from the Medicare experience, and it is found to be wanting. The author presents politicaleconomic theory to explain the origins and actual operation of the Medicare program. The dynamics of this social innovation, as Seen from the political-economic perspective, are then discussed and their relevance to health policy is shown. A study of national health insurance on an international level reveals that the typical pattern of implementation of national health insurance in an industrial country is first, the insurance of industrial workers and their families, and then the progressive expansion of enrollment until all sectors of the population are covered. The aged, as a distinct group, are either insured at a much later date or are not insured at all (1). Considering this general rule, it is curious that the United States should choose to start its program of national health insurance exclusively with the aged. Since the passage of Medicare in 1965 with Title XVIII of the Social Security Act, many monographs and periodicals have been devoted to the history and interpretation of that legislation. Yet despite this apparent plethora of descriptive and analytical literature, little has been written of the reasons for switching from a drive for compulsory universal national health insurance to insuring only the aged. This paper attempts first, to explicate and evaluate the current "conventional wisdom" concerning the passage of Medicare, and then to develop a more adequate politicaleconomic explanation for the way national health insurance is evolving in the United States. The Final Report of the Committee on the Costs of Medical Care (CCMC) published in 1932 (2), long considered the manifesto of liberal health reform in the United States, advocated the group practice of medicine financed through either a public or private insurance mechanism. Response to the report by organized medicine ranged from pressure on state legislatures to enact laws prohibiting the group practice of medicine, to censure and blacklisting of physicians who attempted to establish or work in group practice clinics (3). Most health reformers at that time saw the solution to the problems of medical care delivery in the establishment of a compulsory national health insurance system. The system they proposed would have given the federal government enough control over medical care delivery, through fiscal leverage, to change the method of delivery to the mechanism of group practice advocated by the CCMC.' 'For a reasonably explicit. statement of lhis type of strategy, see the special issue of the International Journal of Health Services on social insurance as an influence on medical care patterns (Volume 1, Number 4, 1971), especially the introduction by Dr. Milton Roemer (pp. 309-311).