“ In 1944, President Roosevelt included the right to adequate medical care and the opportunity to achieve and enjoy good health in his Economic Bill of Rights State of the Union Address. Also in 1944, the Social Security Board called for required national health insurance as a part of the Social Security system.”
Further bills and proposals were advanced under Harry Truman.“ In 1948, the National Health Assembly was convened by the Federal Security Agency,” Smith wrote.“ The final report called for voluntary health insurance, but also stated the need for universal coverage. That same year, the American Medical Association would launch a national campaign against [ Smith’ s italics ] national health insurance.”
A high-water mark was reached in 1965, a year after the passing of the Civil Rights Act. The Medicare and Medicaid programs were incorporated into the Social Security Act and signed into law by Lyndon B. Johnson.“ The bill had massive public approval, the support of the hospital and insurance industries, and no government cost controls or physician fee schedules within it,” wrote Smith. That brief consensus did not last. According to the Kaiser Family Foundation’ s“ Timeline: History of Health Reform in the US,” by the early 1970s, general inflation and unchecked healthcare costs were already a growing concern.“ Sen. [ Edward ] Kennedy’ s proposal for national health insurance was countered by President Nixon’ s own Comprehensive Health Insurance Plan. Other congressmen wrote more incremental plans, all of which splintered support for any one reform. Action on national health insurance was eventually overshadowed by the Watergate hearings and Nixon’ s resignation.”
For the next two decades,“ national health reform efforts were completely stalled in the face of an economic recession and uncontrollable health care costs,” the Kaiser history related, until“ making national health reform a priority early in his presidency, Clinton proposed a‘ managed competition’ approach, sending a detailed plan to Congress in 1993. It called for universal coverage, employer and individual mandates, competition between insurers, with government regulation to control costs.”
“ Support from key stakeholders was often limited and conditional,” the Kaiser history continued.“ The opposition was led largely by two groups: the Health
Courtesy of Kaiser Permanente Heritage Resources
Enrollment surpassed 300,000 people in the first 10 years of the program, thanks to support from the International Longshore and Warehouse Union and the Retail Clerks Union.
Insurance Association of America and the National Federation of Independent Businesses, both believing reform would create hardship for their smaller members. Congressional Democrats were divided in their support, and further splintered by a variety of alternative proposals that were then generated all of which blocked progress on the President’ s plan.”
It was not until 2010 that the House of Representatives passed the Senate bill, the Patient Protection and Affordable Care Act, voting 219 – 212 and sent it to President Barack Obama for the signature by which the law is widely know.
Meanwhile, what some have called the medical-industrial complex came into its own.“ In 1993, [ the year ] before the Blues went for-profit, insurers spent 95 cents out of every dollar of premiums on medical care, which is called their medical loss ratio,” wrote Rosenthal.
“ To increase profits, all insurers, regardless of their tax status, have been spending less on care in recent years and more on activities like marketing, lobbying, administration and the paying out of dividends,” she continued.“ The average medical loss ratio is now closer to 80 %. Some of the Blues were spending far less than that a decade into the new century. The medical loss ratio at the Texas Blues, where the whole concept of health insurance started, was just 64.4 % in 2010.”
Gregory DL Morris is an independent business journalist, principal of Enterprise & Industry Historic Research and an active member of the Museum’ s editorial board. In 2025, he joined the Museum of American Finance staff as a research associate.
Note
1. The Gaffney, Woohandler and Himmelstein study methodology is detailed in their study as follows:“ We used multiple historical and current data sources( including data from the American Medical Association, the American Hospital Association, government publications and surveys, and analyses of Medicare Provider of Services files) to classify health care provider ownership as: public, private( for-profit) and private( not-for-profit). We used US Census data to classify physicians’ employers as public, not-for-profit or for-profit entities or‘ self-employed.’ We combined estimates from the official National Health Expenditures Accounts with other data sources to determine the public vs. private share of health care spending since 1923; we calculated a‘ comprehensive’ public share metric that accounted for public subsidization of private health expenditures, mostly via the tax exemption for employer-sponsored insurance plans or government purchase of such plans for public employees.”
Sources
Gaffney, Adam, Steffie Woolhandler and David U. Himmelstein.“ Century-Long Trends in the Financing and Ownership of American Health Care.” Milbank Quarterly. June 2023.
Morrisey, Michael A. Health Insurance, 2nd Edition. American College of Healthcare Executives. 2013.
Rosenthal, Elizabeth. An American Sickness: How Healthcare Became Big Business and How You Can Take it Back. Penguin Press. 2017.
Rosenthal, Elizabeth.“ Insurance Policy: How an Industry Shifted from Protecting Patients to Seeking Profit.” Stanford Medicine. Spring 2017.
Smith, Katherine.“ A( Brief) History of Health Policy in the United States.” Delaware Academy of Medicine / Delaware Public Health Association. 2023.
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