Health Benefits History - Timeline
Sunday, September 20, 2009
1798 - Marine Hospital Service Established
Congress creates the Marine Hospital Service to provide for sick and disabled seaman. It is the first prepaid medical care program in the U.S. and is financed with a compulsory employer tax. The image shows the nation's first marine hospital on Castle Island in Boston Harbor.
1870's - Industries Use Company Doctors
Railroad, mining, and other industries hire company doctors to treat their employees. Doctor salaries are funded by deductions from worker wages. The image shows the doctors of the Missouri Pacific Railroad Co.
1910 - Montgomery Ward Adopts Insurance
Montgomery Ward & Co. enters into one of the earliest group insurance contracts. The company pays half the cost. The other half comes from wage deductions. The image shows the Montgomery Ward Building in Chicago circa 1900.
1929 - The "Baylor Plan" Created
Baylor Hospital in Dallas, Texas creates the first prepaid hospital insurance plan when it agrees to provide services to a group of schoolteachers for a predetermined monthly cost. The plan is a predecessor of Blue Cross plans.
1939 - Internal Revenue Act Becomes Law
The Internal Revenue Code of 1939 creates a tax exclusion for compensation and damages workers receive from insurance or workers' compensation as a result of injuries or sickness. The image shows a turbine worker of the era.
1943 - National War Labor Board Rules
The NWLB says the national wage freeze does not apply to benefits. As a result, employers looking to attract scarce workers begin offering additional benefits, like health insurance. The image is a propaganda poster of the era.
1945 - Kaiser Health Plan Opens to Public
After WWII, the Kaiser shipbuilding company in California, like many industrial firms, sees its number of employees decline. To keep its Permanente Health Plan operating, the firm opens the plan to non-Kaiser employees. It becomes a forerunner of today's HMO plans. The image shows Kaiser employees signing up for the plan, which was the largest civilian medical care program on the Home Front.
1954 - Internal Revenue Act Becomes Law
The Internal Revenue Code of 1954 creates a tax exclusion for the contributions employers make to health insurance plans for their employees. This change opens the floodgates to employer-sponsored insurance in America. The image shows President Dwight D. Eisenhower, who signed the bill into law.
1965 - Medicare and Medicaid Born
Congress passes the Social Security Act, which establishes the Medicare and Medicaid federal health insurance programs. President Lyndon Johnson signs the bill into law, and former President Harry Truman becomes the first person to enroll in Medicare. The image shows Johnson signing and Truman watching.
1968 - Firestone Funds Health Benefits
Firestone Tire and Rubber Co. begins to self-fund health benefits. The image shows a Firestone advertisement of the era.
1973 - Health Maintenance Organization Act Becomes Law
The HMO Act creates rules for firms wishing to be designated federally qualified HMOs and requires firms that offer HMOs to offer a federally qualified plan. When President Nixon signs the bill, he says, "This legislation will enable the Federal Government to help demostrate the feasibility of the HMO concept over the next 5 years." Nixon is pictured.
1996 - Health Insurance Portability and Accountability Act Becomes Law
HIPAA sets national nondiscrimination and portability standards for individual health insurance coverage, HMOs, and group health plans. The image shows President Bill Clinton signing the bill. Senators Nancy Kassebaum and Edward Kennedy, who co-sponsored the bill, are among the observers.
1997 - CHIP and Medicare +Choice Established
The Balanced Budget Act funds the Children's Health Insurance Program (CHIP), a state-run program designed to make sure all children have health coverage. The BBA also gives Medicare beneficiaries the freedom to enroll in private health programs, including HMOs and PPOs. The image shows the logo for Utah's CHIP program.
CREDITS
History from: Employee Benefits Research Institute, BaylorHealth.com,
U.S. Government Printing Office, Kaiser Permanente, Medicare.gov,
The American Presidency Project, and The Kaiser Family Foundation.
Photos courtesy:
National Library of Medicine, Dr. Robert Gillespie of Railwaysurgery.org,
New York Public Library, TXGenWeb, National Archives, Kaiser Permanente, Firestone Tire & Rubber Company, Associated Press, and
the State of Utah.
