Sixty years ago this week, President Johnson fundamentally changed the American health care system by signing into law Medicare and Medicaid. Medicare and Medicaid remain far from perfect today, but it’s hard to find an achievement that has so directly improved people’s lives in the past sixty years. In the 1960s, around 30 percent of the elderly lived in poverty, health care costs were rising, and the private insurance market considered seniors a “bad risk.”
At the signing of the legislation, President Johnson said, “Older citizens will no longer have to fear that illness will wipe out their savings, eat up their income, and destroy lifelong hope of dignity and independence. For every family with older members it will mean relief from the often crushing responsibilities of care.” Medicare and Medicaid have meant economic security for people after retirement and continued engagement in work, volunteering, and family caregiving as a result of healthier aging. More people with physical and intellectual disabilities have been able to live in their homes and communities today, rather than in institutions, thanks to Medicare and Medicaid. And millions of low-income and middle-income children with high needs have been able to get treatment as a result of these programs.
Both programs have become the foundation of health care coverage in America, interwoven into the national economy and our country’s history. Medicare played a critical role in desegregating hospitals during the Civil Rights era. Within four months, thousands of hospitals across the United States integrated under threat of losing Medicare dollars. Through changes made under the Affordable Care Act, Medicare added payment adjustments to reward hospitals and health care providers for improvements in quality and the value of care they provided. Medicare’s coverage of telehealth visits during the COVID-19 pandemic prompted rapid expansion of telehealth’s use, with much of the employed-based market following suit. During my tenure as administrator of the Centers for Medicare and Medicaid Services (CMS), we were able to use Medicare to strengthen the requirements on hospitals for maternity care—even though Medicare pays for a small percentage of births a year—demonstrating how participation in the Medicare program drives improvement in quality for everyone. Most hospitals in rural or underserved areas, children’s hospitals, community health centers, and mental health providers are incredibly dependent on Medicare and Medicaid funding to keep their doors open.
Figure 1
Some of the programs’ great innovations in health care provision come to market for everyone, not just the Medicare or Medicaid population, because companies hope they will be covered by the two primary payers in the country. Medicare coverage (or Medicaid for treatments for children) can be a driver of decision making for device and drug companies about what types of innovative products to invest in with research and development. That is one of the key reasons that the drug industry supported the Affordable Care Act—covering more people through Medicaid and new ACA coverage—because more insured people meant the potential for better coverage of pharmaceutical products.
Over the past sixty years, more Americans have seen meaningful, affordable health care because of how much Medicare and Medicaid have adapted to meet changing needs and a changing world. Changes in how Medicare pays for services, prescription drugs, mental health, and other services have been added over the years. Medicaid went from an add on to other assistance programs, to expanding coverage of children and pregnant women in 1989, to the Affordable Care Act Medicaid expansion that helped close the coverage gap for adults without children. Ending pricing discrimination for people with pre-existing conditions through Affordable Care Act insurance coverage and expanding Medicaid across the country have been among the most important advances in getting people the care they need and saving lives in history.
Figure 2
These programs evolved because the nation’s health care system has evolved. As a nation, we understand that it matters that people have access to care at every stage of their life, not just when they are at their sickest or at their highest need for care. We can’t have healthier children if their moms don’t receive adequate health care, even before pregnancy. We can’t lower the costs of treating chronic conditions if people don’t get preventive and primary care.
This incredible legacy of expanding coverage and opportunity now, sixty years later, threatens to be brought to a screeching halt. Earlier this month, Republicans in the House and Senate passed and President Trump signed into law a bill that cuts over $1 trillion in health care spending to Medicaid and the Affordable Care Act coverage, which will cause 15 million people to become uninsured. The debate, to the extent there was one, was about who deserves help when they’re sick and who doesn’t. That’s a far cry from President Johnson’s vision of these programs, saying at the signing ceremony for the law, “[they] will help pay for care in hospitals. If hospitalization is unnecessary, it will help pay for care in nursing homes or in the home. And wherever illness is treated—in home or hospital—it will also help meet the fees of doctors and the costs of drugs. Its benefits are as varied as the techniques of modern treatment themselves.”
There is unfinished work to strengthen access to care in this country—whether through Medicare, Medicaid, Affordable Care Act coverage, or the employer market. But the closer we move to President Johnson’s vision, built upon by President Obama and President Biden, the more simple, affordable, and responsive our health care system is for everyone.
Tags: medicare, medicaid
Medicare and Medicaid Turn Sixty
Sixty years ago this week, President Johnson fundamentally changed the American health care system by signing into law Medicare and Medicaid. Medicare and Medicaid remain far from perfect today, but it’s hard to find an achievement that has so directly improved people’s lives in the past sixty years. In the 1960s, around 30 percent of the elderly lived in poverty, health care costs were rising, and the private insurance market considered seniors a “bad risk.”
At the signing of the legislation, President Johnson said, “Older citizens will no longer have to fear that illness will wipe out their savings, eat up their income, and destroy lifelong hope of dignity and independence. For every family with older members it will mean relief from the often crushing responsibilities of care.” Medicare and Medicaid have meant economic security for people after retirement and continued engagement in work, volunteering, and family caregiving as a result of healthier aging. More people with physical and intellectual disabilities have been able to live in their homes and communities today, rather than in institutions, thanks to Medicare and Medicaid. And millions of low-income and middle-income children with high needs have been able to get treatment as a result of these programs.
Both programs have become the foundation of health care coverage in America, interwoven into the national economy and our country’s history. Medicare played a critical role in desegregating hospitals during the Civil Rights era. Within four months, thousands of hospitals across the United States integrated under threat of losing Medicare dollars. Through changes made under the Affordable Care Act, Medicare added payment adjustments to reward hospitals and health care providers for improvements in quality and the value of care they provided. Medicare’s coverage of telehealth visits during the COVID-19 pandemic prompted rapid expansion of telehealth’s use, with much of the employed-based market following suit. During my tenure as administrator of the Centers for Medicare and Medicaid Services (CMS), we were able to use Medicare to strengthen the requirements on hospitals for maternity care—even though Medicare pays for a small percentage of births a year—demonstrating how participation in the Medicare program drives improvement in quality for everyone. Most hospitals in rural or underserved areas, children’s hospitals, community health centers, and mental health providers are incredibly dependent on Medicare and Medicaid funding to keep their doors open.
Figure 1
Some of the programs’ great innovations in health care provision come to market for everyone, not just the Medicare or Medicaid population, because companies hope they will be covered by the two primary payers in the country. Medicare coverage (or Medicaid for treatments for children) can be a driver of decision making for device and drug companies about what types of innovative products to invest in with research and development. That is one of the key reasons that the drug industry supported the Affordable Care Act—covering more people through Medicaid and new ACA coverage—because more insured people meant the potential for better coverage of pharmaceutical products.
Over the past sixty years, more Americans have seen meaningful, affordable health care because of how much Medicare and Medicaid have adapted to meet changing needs and a changing world. Changes in how Medicare pays for services, prescription drugs, mental health, and other services have been added over the years. Medicaid went from an add on to other assistance programs, to expanding coverage of children and pregnant women in 1989, to the Affordable Care Act Medicaid expansion that helped close the coverage gap for adults without children. Ending pricing discrimination for people with pre-existing conditions through Affordable Care Act insurance coverage and expanding Medicaid across the country have been among the most important advances in getting people the care they need and saving lives in history.
Figure 2
These programs evolved because the nation’s health care system has evolved. As a nation, we understand that it matters that people have access to care at every stage of their life, not just when they are at their sickest or at their highest need for care. We can’t have healthier children if their moms don’t receive adequate health care, even before pregnancy. We can’t lower the costs of treating chronic conditions if people don’t get preventive and primary care.
This incredible legacy of expanding coverage and opportunity now, sixty years later, threatens to be brought to a screeching halt. Earlier this month, Republicans in the House and Senate passed and President Trump signed into law a bill that cuts over $1 trillion in health care spending to Medicaid and the Affordable Care Act coverage, which will cause 15 million people to become uninsured. The debate, to the extent there was one, was about who deserves help when they’re sick and who doesn’t. That’s a far cry from President Johnson’s vision of these programs, saying at the signing ceremony for the law, “[they] will help pay for care in hospitals. If hospitalization is unnecessary, it will help pay for care in nursing homes or in the home. And wherever illness is treated—in home or hospital—it will also help meet the fees of doctors and the costs of drugs. Its benefits are as varied as the techniques of modern treatment themselves.”
There is unfinished work to strengthen access to care in this country—whether through Medicare, Medicaid, Affordable Care Act coverage, or the employer market. But the closer we move to President Johnson’s vision, built upon by President Obama and President Biden, the more simple, affordable, and responsive our health care system is for everyone.
Tags: medicare, medicaid