Should the United States government give everyone free health care? Millions of Americans have lost their health insurance. In Canada, and many countries in Europe, health insurance is guaranteed. Some experts here argue that universal health insurance can be successful. Other equally well qualified people counter that it would be too expensive or claim that the care would be poor. They believe that market forces will fix any shortcomings of the U.S. health care system.
Health insurance in the United States is a relatively new phenomenon. The first insurance plans began during the Civil War (1861-1865). The earliest ones only offered coverage against accidents related from travel by rail or steamboat. The plans did, however, pave the way more comprehensive plans covering all illnesses and injuries. The first group policy giving comprehensive benefits was offered by Massachusetts Health Insurance of Boston in 1847. Insurance companies issued the first individual disability and illness policies in about 1890.
In 1929, the first modern group health insurance plan was formed. A group of teachers in Dallas, Texas, contracted with Baylor Hospital for room, board, and medical services in exchange for a monthly fee. Several large life insurance companies entered the health insurance field in the 1930’s and 1940’s as the popularity of health insurance increased. In 1932 nonprofit organizations called Blue Cross or Blue Shield first offered group health plans. Blue Cross and Blue Shield Plans were successful because they involved discounted contracts negotiated with doctors and hospitals. In return for promises of increased volume and prompt payment, providers gave discounts to the Blue Cross and Shield plans.
Employee benefit plans proliferated in the 1940’s and 1950’s. Strong unions bargained for better benefit packages, including tax-free, employer-sponsored health insurance. Wartime (1939-1945) wage freezes imposed by the government actually accelerated...