The American healthcare system is a joke. Laughably full of grift and greed. Healthcare Insurance is a billion-dollar industry that profits off the backs of Americans and gives barely anything in return. Democrats spent decades trying to fix the system and install a government regulated insurance program, but failed every time because of lobbying and financial gains, and a smattering of moron politicians. Republicans, meanwhile, pushed reforms to the system that subsidized the health insurance industry in the hopes that those subsidies would ensure that the cost of health care would drop. By the mid 2000's the dream of a single payer system was dead, and the private insurance industry had cemented its grip on our health care system. In my opinion, the system needs to be burned to the ground, and we need to examine why it is that we feel the need for capitalism to exist in an area that is essential to the well-being of our nation and our society.
Starting at the beginning; our nation was not born with a health care system, quite the opposite. At its inception, our nation had a tangle of soothsayers, and self-proclaimed medicine men and women who touted things that were guaranteed to make all ailments better. Abortion medicines weren’t even advertised as intended for abortion, instead these things were advertised as a solution meant to restore a woman to her natural flow.(Able, 2022) Medical services were rendered by practitioners who were trained via another practitioner who, once they felt their apprentice had learned enough, would sign off on them to be a certified practitioner themselves. The best part? The student paid the teacher to study with them and learn from them. Payments came in the form of whatever the hell the patient could pay, and prices were always set by the “doctor.” (Griffin, 2020) That is not to say that real medical care did not exist, medical schools, such as the medical department of Kings College popped up in the 1760’s and the first medical degree was awarded in the 1770’s. (Griffin, 2020) Further still, proof of medical understanding can be seen in the story of how George Washington instituted the small pox vaccine for the continental army in order to keep his military strength while preventing the spread of the dangerous disease. (Aker, 2021)
Gradually, formal medical education became a thing in the United States and a degree from a reputable school meant more than a certificate from the old village doctor. Formal education and professionalization of the medical field led to the formation of medical societies. The most influential of these is the American Medical Association (AMA). (Griffin, 2020) I mentioned the AMA in the previous series on reproductive health, they were the organization that spearheaded the push to end legal abortion prior to Roe, they are also the organization that pushed propaganda that painted women as untrustworthy. (Able, 2022) My research has uncovered so much about the history of the AMA that I am amazed that they still exist as an organization to this day. We will talk more about the AMA later in this blog, but suffice it to say, they have quite a bit of responsibility for the healthcare system we all enjoy today.
Of course, with higher education comes higher costs and those higher costs were passed down to, you guessed it, the patient. The first thing that happened with this rise in cost was the change in how doctors accepted payment, instead of accepting things in lieu of monetary payment, doctors strictly adhered to accepting only money in exchange for their services. In order to pay for the rising costs in health care, the first forms of health insurance took shape. The earliest example of this is born out of a desire for a Washington lumber company to ensure that its employees had access to health care. (Health Markets, 2021) This form of “insurance” was called a “sickness fund” it was paid for by employees who would provide a percentage of their paycheck to ensure the fund had the money to cover them if they became sick or injured and were unable to work. (American College of Healthcare Executives, n.d.)
At the start of the 20th century, employers found themselves liable for workplace injuries if they were found to be the result of the employer’s negligence. Often, the employer would defend themselves with three strategies: the employee assumed the risk when they took the job, the injury was the result of the negligence of a co-worker, and finally, the injured employee was at least partially at fault. In the early 1900’s cases to determine liability were common, if not frequent. As a result, employers pushed for workers compensation laws throughout the nation. These laws established an insurance program that employers could purchase from the government. Coverage was optional and the laws had an interesting loophole: if employers purchased the coverage, then they would be able to use the three defensive strategies to contest employee claims, if an employer chose to forego the insurance, they would lose the ability to employ the defensive strategies and would be immediately identified as negligent in any injury claim. (American College of Healthcare Executives, n.d.)
Even as employers bought into workers compensation, the discussions around healthcare and who should pay for it began to pop up in the political scene and the first efforts to formalize health insurance took form. President Theodore Roosevelt, along with his progressive party came out in public support of something called social insurance (Aker, 2021), more on that in a bit. It was this governmental endorsement of social insurance that led to organizations like National Convention of Insurance Commissioners to develop and deliver to the states, a prototype of legislation that could be used to regulate health insurance. At the same time, another organization, American Association for Labor Legislation, proposed legislation that would make health insurance compulsory nationwide. (Aker, 2021)
Private insurance plans as we know them today, took shape during the great depression. This is where two of the largest providers of health insurance got their start. BlueCross began as a program instituted by the Baylor University Hospital in Dallas, Texas. The program was designed to provide local teachers with access to healthcare for $6 per month, allowing for a 21 day stay at the hospital for $5 per day. (Aker, 2021) Accounting for inflation, in today’s economy that comes out to $104.57 per month and $87.14 per day for 21 days. Still comically lower than what is paid by Americans today: $456 on average for individuals and $1,152 on average for families per month. (Porretta, 2022) I’ll dive deeper into health care costs in a later entry. Getting back to the topic, Kaiser Permanente got started when a man named Henry Kaiser came to an arrangement for his aqueduct workers to have access to healthcare at a local hospital at a fixed rate. (Aker, 2021) Throughout the 1930’s more of these plans began to sprout up and became known as “hospital service plans.” As with anything that develops over time, these programs began to professionalize, eventually forming committees run by hospitals across the nation. These committees developed rules to govern and regulate hospital service plans, they also developed a list of requirements for plan approvals. These committees grew to form the basis for the system of health insurance networks that Americans enjoy so much. (Health Markets, 2021)
In the late 1930’s discussion around a public health insurance program arose out of the poor economic situation resulting from the Great Depression. President Franklin Roosevelt established a Committee on Economic Security (CES) to study and establish a program to address old-age and unemployment issues, as well as medical care and health insurance. While it was tasked with finding a way to address health insurance as part of its mandate, the committee prioritized retirement benefits and unemployment insurance due to the desire to develop a program that would gain the most support in Congress. (The Henry J. Kaiser Family Foundation, 2009) The biggest program that resulted from the CES is the Social Security Act which established the Social Security Tax and the Social Security Administration to provide a stable income for the elderly, retired population. (The Henry J. Kaiser Family Foundation, 2009) (That’s another topic we will be visiting so I will leave that subject alone for now.) Roosevelt tried again to reform health care after the passage of the Social Security Act, this time convening the Technical Committee on Medical Care. The resulting recommendations for reform called for the establishment of a federally subsidized and regulated state-run system, though participation in this system was voluntary for individual states, citizens of states that participated in the program would be required to have health insurance. (The Henry J. Kaiser Family Foundation, 2009)
Roosevelt’s reforms failed to be ratified by Congress, primarily due to a shift by Southern Democrats who aligned themselves with their Republican counterparts who opposed the expansion of the federal government, an effort seen by Southern Democrats to protect segregation. (The Henry J. Kaiser Family Foundation, 2009)To completely seal the coffin and bury the National Health Initiative presented by Roosevelt, the AMA(yea, that organization)decided to raise its nasty little head and stick its nose into the political arena yet again. This time the AMA stood against any form of government provided health insurance plan on the basis that any such plan would result in doctors losing autonomy, being forced to work in group practice models and, the icing on the cake, limit a doctor’s income to a salary basis or limit their income with profit caps. (The Henry J. Kaiser Family Foundation, 2009)
In the 1940’s the story remained the same. The Truman administration introduced a bill that would have established a single payer health insurance plan that would provide subsidies to the poor and would have resulted in all Americans having equal and equitable access to health care services. Given the timeframe that this proposed system came about, it is only natural to understand why it never became reality. The AMA, oh hello there, once again stepped up to block passage of the bill. Taking advantage of the sweeping anti-communist rhetoric, the AMA spread propaganda that painted Truman’s single payer system as “socialized medicine.” (The Henry J. Kaiser Family Foundation, 2009)
The 1960’s saw some changes to the opposition to government health insurance programs. During the 1950’s and 1960’s employer provided health care insurance was the dominant force in the healthcare world. Increasing premiums and a shift to the use of “experience ratings” made it harder for the sick, elderly and poor to get the coverage they needed to ensure they could receive the care they needed. This allowed President Eisenhower to propose and pass legislation authorizing the federal government to provide subsidies to the states for the purpose of covering healthcare for the elderly poor. Unsurprisingly, the law proved to be a flop with only 28 states signing on to the plan. The late President Kennedy, followed by his successor, President Truman, made great strides to reform the Eisenhower law, introducing Medicare and Medicaid. At the same time other bills were proposed, the Eldercare Act, which would have expanded the law passed under Eisenhower and was supported by the AMA, seriously, they just keep popping up on the wrong side of history, and the Bettercare Act, which would have allowed for federal subsidies for the purpose of purchasing private health care insurance, this one was fittingly proposed by a private health insurance company (The Henry J. Kaiser Family Foundation, 2009), narcissistic much?
President “I am not a crook” Nixon, to stave off inflation, instituted wage and price freezes nationwide. These freezes targeted hospitals and doctors by placing specific limitations on their annual increases in the cost of providing care. (The Henry J. Kaiser Family Foundation, 2009) Nixon pushed a version of a national health care insurance system after Senator Ted Kennedy submitted a bill of his own. The difference between the two was that Kennedy’s bill would have established a single payer system, eliminating private health insurance all together, Nixon’s plan catered to the private health insurance industry by partnering with them, requiring businesses to pay for insurance coverage for their employees or pay into a government system. (Evans & Schiff, 2009) The Vietnam war and the scandal surrounding Nixon, aka Watergate, put an end to discussions around health care reform.
The political debate continued back and forth over the decades, Republicans putting forth bills that would subsidize the private sector, and Democrats trying, and failing, to pass legislation that would establish a single payer system. Although some progress was made: improvements to Medicare and Medicaid to include the creation of Medicare Advantage, a third part to Medicare that covered the gaps made by Medicare parts A and B, Congress also managed to pass the Health Insurance Portability and Accountability Act (HIPAA) which provided some protections to people with pre-existing conditions. (Health Markets, 2021)
President Bush, the son, managed to push through legislation that established healthcare savings accounts, a comical attempt to give health care access to individuals and families who would otherwise have to pay ridiculously high deductibles, think $1k plus. I call it comical because it established a system that forced families to pay more for health insurance while retaining an insurance plan that required them to pay for most care completely out of pocket. (Health Markets, 2021) Once again, Republicans cater to the private sector and provide them with a means to profit off of the less fortunate.
After the 2008 elections, President Obama, with the help of a Democrat Majority in both houses of Congress managed to pass the Affordable Care Act, which was a deviation from the historic pattern of repeatedly trying the same thing while getting the same result. This was not the single payer system that Democrats have dreamt of since Franklin Roosevelt; instead, ACA made health insurance compulsory nationwide. ACA created a massive pool of funding for the private insurance industry. Not to deny its merits, however, ACA did establish protections for individuals with pre-existing conditions, and allowed for children under the age of 25 to be covered by their parents plans, it even temporarily reduced the cost of insurance premiums. (American College of Healthcare Executives, n.d.) Unfortunately those benefits do not over shadow the fact that the ACA is more beneficial to the healthcare industry than it ever was to the average American citizen.
Political infighting being what it is, Republicans opposed ACA from the start, not because the law created a socialist healthcare plan, instead, Republicans hated ACA because the Democrats passed it. It is that simple. As a result, Republicans, under President Trump wasted no time taking ACA out at its knees: removing the funding it needed to regulate the industry, eliminating the compulsory coverage, and granting waivers on behalf of religious groups. (Center on Budget and Policy Priorities, 2021) Proving my point about the political reasons behind Republican opposition to ACA, when Republicans had the chance to repeal ACA and replace it with something different, they chose not to, instead leaving what remained of the law intact. (Kapur, 2022)
What the hell is wrong with our healthcare system? The answer to that question is complicated but our health insurance industry has contributed to the mess that we, as Americans, must navigate in order to ensure that we remain healthy. I will continue to dive into the healthcare system over the next few entries, so stay with me and maybe together we can find a way to fix it.
Works Cited
Able, C. (2022, August). Crayon Box Politics. Retrieved from crayonboxpolitics.com: https://www.crayonboxpolitics.com/blog/the-blog-2/reproductive-rights-part-1-2
Aker, J. A. (2021, August 16). Health.mil. Retrieved from www.health.mil: https://www.health.mil/News/Articles/2021/08/16/Gen-George-Washington-Ordered-Smallpox-Inoculations-for-All-Troops
American College of Healthcare Executives. (n.d.). Retrieved from https://www.ache.org: https://account.ache.org/iweb/upload/Morrisey2253_Chapter_1-3b5f4e08.pdf
Center on Budget and Policy Priorities. (2021, February 2). Retrieved from www.cbpp.org: https://www.cbpp.org/sabotage-watch-tracking-efforts-to-undermine-the-aca
Evans, J., & Schiff, J. (2009, August 26). Kaiser Health News. Retrieved from www.khn.org: https://khn.org/news/kennedy-health-care-timeline/
Griffin, J. (2020, March 27). J. P. Griffin Group. Retrieved from www.griffinbenefits.com: https://www.griffinbenefits.com/blog/history-of-healthcare
Health Markets. (2021, July 14). Retrieved from healthmarkets.com: https://www.healthmarkets.com/resources/health-insurance/american-healthcare-history
Kapur, S. (2022, October 2). Republicans abandon Obamacare repeal. NBC News.
Porretta, A. (2022, October 1). eHealth. Retrieved from ehealthinsurance.com: https://www.ehealthinsurance.com/resources/individual-and-family/how-much-does-individual-health-insurance-cost
The Henry J. Kaiser Family Foundation. (2009, March). Retrieved from www.kff.org: https://www.kff.org/wp-content/uploads/2013/01/7871.pdf
Great article! Profit is the problem with american healthcare .The AMA should have been dissolved decades ago. Also, please dig deeper into Medicare Advantage, it's a scam IMO.