A Look Back on The Road to Medicare.

As we approach another Medicare Open Enrollment season, I thought it would be appropriate to look back on how it all began, and the steps it took to get there!

Nearly 60 years ago, in Independence Missouri, President Lyndon B Johnson signed the bill that became Medicare & Medicaid. The date was July 30th, 1965.

Prior to this landmark national health care legislation, people over the age of 65 had limited options available for private health insurance.

According to one report, by 1965 well over half of the general population had some form of hospital insurance as well as surgical insurance, and the market for major medical which includes primary or out of hospital care was rapidly growing.

Unfortunately, those numbers were closer to less than one half for the elderly population.

The first generation eligible for this new Medicare program had been through two world wars with the Great Depression in-between.

They also were among the first beneficiaries of the Social Security legislation in 1935.

But there were limited options for health insurance for the elderly which meant unplanned hospital and doctors’ bills could cause extreme hardship.

This economic threat from unplanned healthcare costs didn’t go unnoticed by our government leaders over the years.

As early as 1912 Teddy Roosevelt’s platform for the Progressive Party was social insurance for sickness. In 1915, a labor group proposed a medical insurance bill to certain state legislatures, but opposition by special interests led to its failure.

When FDR signed the Social Security Act in 1935, he wanted to include a health care bill. But the committee was afraid that this inclusion would lead to the entire bill’s demise.

In 1945, President Harrison S Truman proposed a national health care program. It made its way to Congress through a Social Security Expansion bill known as the W-M-D bill.

Special interest groups again rallied against it, fearing socialized medicine would lead to Communism and by the Korean War, this bill was also abandoned.

Although his bill never saw the light of day either, he did a good job of bringing the issue of health care in America to light on a national level. It’s been noted that Blue Cross-Blue Shield, the non-profit health insurance fund, gained over 33 million policies during his presidency.

Truman was also considered the “Daddy” of Medicare by Lyndon B. Johnson and was the first beneficiary to be enrolled into the program after the signing of the bill at the Harry S. Truman Library & Museum in Independence Missouri.

In 1958 a Rhode Island Congressman by the name of Aime Forand proposed a bill to cover hospital costs for the elderly on Social Security.

Of course, there was swift opposition from special interests for this bill too, mainly the American Medical Association who at the time was against any notion of government interference of the patient-doctor relationship.

At this time though there was a growing grassroots support from seniors that brought the issue of health care to a national level, and it became harder for opponents to sway the debate.

The Kerrs-Mill Act of 1960 sought to address the issues of healthcare by initiating federal grants to individual states to help the medically indigent elderly pay for medical services.

But it didn’t solve a lot of issues because state adoption was voluntary, and it was only available to people who could pass a stringent means test. This act was really the precursor to what became Medicaid.

Another bill was proposed called the King-Anderson bill in 1962 which included covering not only the hospital but nursing home costs for people ages 65 and older. This bill too was defeated, but by a very narrow margin.

The American Medical Association later proposed an expansion of the Kerrs-Mill Act called Eldercare which included broader benefits that included doctor services, which through a series of compromises became Medicare and Medicaid.

Fun Fact: If you ever wondered why Hospital Insurance and Medical Insurance is split up into two parts, it’s because of a compromise.

The original Medicare proposal was really just hospital insurance, but as the debate went on, it became clear that hospital insurance only would be inadequate. The comprise was to add a voluntary plan that covered doctor services, modeled after an Aetna health insurance policy.

It couldn’t be combined because the Hospital Insurance plan was to be compulsory, and the Medical Insurance plan had to be voluntary in getting enough votes to pass.

So that’s why your old Red, White, & Blue Medicare card has two separate parts, Part A which covers Hospital Insurance and Part B which covers Medical Insurance.

Over 19 million Medicare cards were issued the first year Medicare began.