Healthcare Technology Featured Article

May 17, 2011

What is Healthcare Reform?

Healthcare reform has had a long history in this country, going as far back as 1912, and some would argue, back into the 1800s.

But in 1912 Teddy Roosevelt and his Progressive party endorsed social insurance as part of their platform, including health insurance.

In the early 1930's, hard economic times called for social policies to secure employment, retirement, and medical care. President Franklin Roosevelt (Teddy Roosevelt's distant cousin) appointed a committee to work on all these issues, but in the end did not risk the passage of the Social Security Act to advance national health reform.

In the late 1930's President Roosevelt continued to support national health reform throughout his terms. His second push for national health insurance came after the Social Security Act passed. However, the momentum from FDR’s Technical Committee on Medical Care and a National Health Conference were not enough to overcome a Congress that was no longer supportive of further government expansions.

In 1943, in the midst of WWII, the War Labor Board ruled the wage freeze did not apply to fringe benefits, including health insurance benefits.

In 1945, President Truman picked up the mantle for a national health program just months after the end of World War II. His election in 1948 appeared to be a mandate for national health insurance, but the opposition, using fear of socialism, coupled with the power of southern Democrats who believed a federal role in healthcare might require desegregation, effectively blocked all proposals.

But it didn't end there. The '50's saw a slew of activity. In 1950, the National Conference on Aging is convened by the Federal Security Agency. In 1951, the Joint Commission on the Accreditation of Hospitals formed to improve the quality of hospital care through the voluntary accreditation of hospitals.

In 1952 the Federal Security Agency proposed health insurance for Social Security beneficiaries. And in 1953 the Federal Security Agency made a cabinet-level agency, the Department of Health, Education and Welfare. A year later, President Eisenhower proposed a federal reinsurance fund to enable private insurers to broaden the groups of people they would cover.

In 1956 the Military "Medicare" program started, providing government health insurance for dependents of those in the Armed Forces. Legislation was introduced a year later to provide health insurance for Social Security beneficiaries, and it was reintroduced in 1959.

The groundwork for the enactment of Medicare and Medicaid began in the late 1950s and early 1960s. As employer-based health coverage grew, private plans began to set premiums based on their experience with health costs and the retired and disabled found it harder to get affordable coverage.   Health reformers refocused their efforts toward the elderly.

Probably the most significant stab at modern-day health insurance came about through "The Great Society," established by President Lyndon Johnson, when Medicare and Medicaid were incorporated under the Social Security Act and signed in 1965 by Johnson with Truman by his side. The combination of Johnson’s political skills, a large Congressional Democratic majority, public approval, the support of the hospital and insurance industries, and the fact that no government cost controls or physician fee schedules were enacted contributed to the passage of the most significant health reform of the century.

In the '70's U.S. Senator Ted Kennedy drafted a national health insurance proposal, which was then followed by President Carter's own plan that would delay implementation until 1983. National health reform efforts were completely stalled in the face of an economic recession and uncontrollable healthcare costs.

In 1980 the Department of Health, Education, and Welfare was renamed the Department of Health and Human Services. A year later the federal government required states to make additional Medicaid payments to hospitals which served a disproportionate share of Medicaid and low-income patients. It also repealed the requirement that state Medicaid programs pay hospital rates equivalent to those paid by the Medicare program.

In the early '90's, 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. The opposition was led largely by two groups: the Health 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.

In 1996 Congress restricted the use of pre-existing conditions in health insurance coverage determinations, set standards for medical records privacy, and established tax-favored treatment of long-term care insurance.

Between 2005 and 2009 Massachusetts passed and implemented legislation to provide healthcare coverage to nearly all state residents.

Legislation required residents to obtain health insurance coverage and called for shared responsibility among individuals, employers, and the government in financing the expanded coverage. Within two years of implementation, the state's uninsured rate was cut in half.

One month following Massachusetts, Vermont passed comprehensive healthcare reform, also aiming for near-universal coverage. In addition to creating the Catamount Health Plan for uninsured residents, the plan focused on improving overall quality of care and the management of chronic conditions through the Blueprint for Health.

The City of San Francisco also created the Healthy San Francisco program, providing universal access to health services in the city for residents.

The 2008 presidential campaign focused early on national health reform, overshadowed later by the housing crisis and economic downturn, yet remained a key pocketbook issue throughout the campaign. Both major party candidates announced comprehensive health reform proposals.

Finally, in 2010, the House of Representatives passed the bill previously passed by the Senate, the Patient Protection and Affordable Care Act (voting 219-212), and sent it to the President for signature.

The act ensures that all Americans have access to quality, affordable healthcare and created the transformation within the healthcare system necessary to contain costs.

One year later, reforms under the Affordable Care Act have given Americans new rights and benefits, by helping more children get health coverage, ending lifetime and most annual limits on care, allowing young adults under 26 to stay on their parent’s health insurance, preventing insurance companies from denying coverage to people with "pre-existing" conditions and giving patients access to recommended preventive services without cost.

Deborah DiSesa Hirsch is an award-winning health and technology writer who has worked for newspapers, magazines and IBM in her 20-year career. To read more of her articles, please visit her columnist page.

Edited by Stefania Viscusi
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