NCPA - National Center for Policy Analysis

It's Time to Rethink How We Manage, Pay for Care for The Sickest 10%

February 21, 2017

Senior Fellow Devon Herrick writes for Managed Healthcare Executive:

Health insurance has served different purposes over the years. Congress established the U.S. Marine Hospital in 1798 as a way to care for U.S. seamen, who were required to contribute a portion of their wages in return for access to services. However, most health insurance policies developed over the next century were designed to protect against income loss due to accidents rather than covering medical services.

It wasn't until near the end of the 19th century that companies from selected industries began providing coverage for medical services.

In the early part of the 20th century, progressive social reformers began advocating for a compulsory health insurance system. Reformers wanted to redistribute sick peoples' medical costs and wage losses among the rest of society through social insurance. 

Until the 1950s, most health insurance plans were mini-med plans, by today's standards. Benefits were limited to specific circumstances, such as a specific number of days, hospital stays or episodes of care, etc.

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