History of Health Insurance in America

Health insurance has a long commercial and political history, with both beginning around the time of the Great Depression. While the commercial aspect widens around the time of World War II, the political side doesn't really have effects until the Kennedy era and then more so during the Reagan administration and beyond.

1929 to 1940

• Blue Cross is formed by Dallas Texas teachers becoming the first prepaid hospital plan. The precursor to Blue Shield, California Physicians Service begins offering coverage. The first national health insurance plan was defeated in Congress.

1940s

• Commercial insurance companies enter the health insurance field after the success of Blue Cross and Blue Shield. The Internal Revenue Service rules that health insurance payments are not taxable by employers, while the National Labor Relations Board rules that benefits are considered "wages" and can be part of collective bargaining.

1950s

• Millions are covered by commercial health insurance or Blue Cross/Blue Shield. Private health insurance covers 75 percent of Americans.

1965

• Medicare for the elderly becomes law. Medicaid also begins for low-income citizens.

1980s and 1990s

• COBRA is created to protect employees losing group coverage. The Health Insurance Portability and Accountability Act allows employees to keep coverage when switching jobs. The Children's Health Insurance Program is set up for low-income children.

Beyond 2000

• Prescription drug benefits are added to Medicare Part D as law is passed to expand health savings accounts by 2005. Massachusetts makes health insurance mandatory within a year afterward.