The Lancet, Volume 386, No. 9991, p332–333, 25 July 2015
by Elizabeth Fee
50 years ago, on July 30, 1965, US President Lyndon B Johnson signed the Medicare Act into law. The law created two new programmes, Medicare for those who had reached the social security retirement age of 65 years, and Medicaid for those whose incomes were below specific levels. In the context of the long history of struggles to obtain national health insurance in the USA, this was a momentous act. Admittedly, the law applied only to part of the population, the old and the poor, but it was nonetheless an important advance.
Organised efforts to attain national health insurance in the USA began in the early 20th century, first by the Socialist Party, and soon after, by the Progressive Party and the American Association for Labor Legislation. At first, the American Medical Association (AMA) supported the idea of national health insurance, but then reversed its position. After the Russian revolution in 1917, thousands of people in the USA who were suspected of being communists were jailed or deported. In this changing political context, proponents of national health insurance were soundly defeated. Vocal support for national health insurance resurfaced during the Great Depression, when many could not afford the cost of medical care. The Social Security Act of 1935 provided old-age retirement insurance, unemployment insurance, and limited funds for specific groups: women and children, the physically disabled, and the blind. The old-age insurance was financed from taxes on employers and their employees. Initially, health insurance was intended to be part of the social insurance package, but it was dropped because of strong opposition, led by the AMA. The Journal of the American Medical Association presented national health insurance as a “revolutionary” and “Bolshevik” menace to the public health, undermining traditional American values of individualism and self-reliance.
Despite such claims, national health insurance became an increasingly insistent policy demand over the next decade and, in 1945, President Harry S Truman announced his support for a national health-care programme. This, he said, should encompass several areas: using federal funding to attract health-care professionals to rural and low-income areas; providing funds for the construction of hospitals; creating a board to establish standards for hospitals and to direct funds towards medical research; and developing a national health insurance plan, to be run by the federal government, and open to all Americans. Various bills were introduced to the US Congress but not one was successful. Few politicians wanted to provoke the ire of the AMA or face the opposition of the insurance industry, the pharmaceutical industry, and an array of conservative political forces that declared that this proposal for “socialized medicine” was probably inspired by Communism, and that the Truman White House staffers were “followers of the Moscow party line”. Facing strong and well-funded opposition, Truman backed away from the plan. With no politically viable alternative, private sector health insurance grew steadily, especially as unions insisted on including health benefits in bargaining agreements, as their best surviving option. Health insurance thus became tied to employment; retirees, the unemployed, and the underemployed were largely left out.