Medicare History

The history of the Medicare system begins all the way back in 1945 with a vision by then president Harry S. Truman. This was immediately after the end of World War II and the United States was ready to focus on prosperity and taking care of its citizens. In 1945, the United States had finally come out of the Great Depression, which has lasted for over a decade. The lessons learned during the Great Depression would help to create many of the public policy reforms that would try to prevent such a depression from ever happening again. The idea of a Social Security system along with unemployment insurance and banking reforms were just some of the programs that were introduced during the late 1940's.

As popular as the notion of public health care was immediately after World War II, Truman could not get Congress to act on his idea of what was eventually referred to as a public health insurance system. The Congress was rightfully more concerned with making sure that the country maintained the prosperity that began immediately after the end of the war. That meant developing policies that would help prevent a financial collapse before any public health insurance causes were taken up. For 20 years the idea of providing health insurance for citizens that did not have access to it sat dormant. That was until John F. Kennedy became president.

In 1961, President John F. Kennedy pointed out to the Congress that nearly 45 percent of all Americans over that age of 65 did not have health insurance. He warned the Congress of pending financial doom if the aging population was not properly cared for. After Kennedy's assassination in 1963, Vice President Lyndon Johnson became president and picked up the fight for public assistance programs that Kennedy had spearheaded. Finally, in 1965, the Congress passed the Social Security Act which created a long list of public programs to help the American public, including Medicare.

The Social Security Administration was created with the Social Security Act, and the SSA was put under the umbrella of the Department of Health, Education and Welfare. On July 30, 1965, President Johnson made the public health care plans of Medicare and Medicaid official by signing the Medicare and Medicaid Bill, which was a subsidiary part of the Social Security Act. It was decided that Medicare would be placed under the administration of the SSA. President Harry Truman, who had started the quest for public health insurance for the elderly and the poor 20 years earlier, was the first person in the United States to get a Medicare card.

When the Medicare and Medicaid Act was first signed into law, it was intended to offer health insurance for the elderly and the poor. The criteria for the elderly was that they had to be 65 years of age or older and not have health insurance from another source. The poor were generally regarded as the people that needed to be on the public programs that had just been established because they could not afford to pay their bills or they had experienced a serious illness or injury. In its earliest years of existence, the Medicare program had approximately 19 million enrollees and was already starting to expand its coverage to more and more Americans.

In the early 1970s, Congress had started to expand the pool of people that could be eligible for Medicare benefits by including those that were receiving cash subsidies from public assistance and those suffering from certain kinds of ailments. As the American public continued to age and the number of elderly people that did not have health insurance grew, the program had to be expanded further. The problem was that most Americans at the time had health insurance through their place of employment. Many would lose those health benefits once they retired. Congress stepped in to try and make sure that all elderly Americans that could not afford their own health insurance coverage received Medicare.

For 30 years, the Medicare system struggled to keep up with the changing face of the medical world. Prescription drug prices were starting to rise, the cost of offering medical treatment was going up due to the rising costs of malpractice insurance and many people were finding it more and more difficult to keep up with the changes that were going on in the health care industry. Just like the rest of the country, the federal government was also having problems keeping up with the changes and Congress knew that something had to be done.

In 2003, President Bush made the Medicare Prescription Drug Improvement and Modernization Act an update to the archaic system that was in place. The new rules allowed Medicare recipients to make more choices of their doctors, medications and forms of treatment. It allowed the Medicare system to keep up with the changes in the health care industry and offer ongoing health insurance to the elderly and the poor.

Medicare remains the country's national health insurance program and it is getting even more updates with health care reforms that were introduced by President Obama in 2009. Many of the Obama changes will alter who is eligible for Medicare and how Medicare will cover costs. It is just another way that the federal government continually tries to keep Medicare valid and relevant as good health insurance.