My PICC Line

The woman in front of me was looked like a scrapped sausage casing full of bones, her skin had lost color, her eyes had lost flicker. Here she was, not in a bed  but one of the hospital’s billing department offices being grilled. Over and over she would tell the man at the desk that her insurance covered this or that, and over and over he explained explained ‘not exactly.’ The first inclination is to point you’re rage at the bastard behind the desk for even questioning someone this ill, but he’s just doing his job. If he decides to pander to morality, his checks will soon be coming from the unemployment office.

So how did we get here? How did healthcare allow itself to be reduced to hounding the severely ill(and often “insured” mind you) about money? Below I’ve included five of the more important events in the evolution employee-based insurance in the United States.

1.The Beginning—In the 1890′s the seeds of employer based health insurance are planted in the blue collar work force. With the promise of patients(and therefore money) doctors begin to migrate to remote areas to care for rail and mine workers owners who need healthy employees to maximize profits. Medicine, however, is a bit rough around the edges. There are few standards to being a physician and medical technique lacks any consistent form. In his book Sick, Johathan Cohn writes of one scientist who remarked “It was about 1910 or 1912 when it became possible to say in the United States that a random patient with a random disease consulting a doctor chosen at random stood better than a fifty-fifty chance of benefiting from the encounter.”

2. Care becomes legitimate.. and expensive—By the 1920′s rural America is transitioning to urban America.The sudden increase in densely populated areas means less room for sick family members in the home. Facilities to treat the sick are in demand, medicine is progressing and so are the standards to becoming a physician. Better doctors demand better medical technology—both cost hospitals more money. The cost is shifted to the patient, and with the onset of the Great Depression,Cohn reports, the expense of a single week in the hospital surpasses what the average American is bringing in over the course of an entire month. People can no longer afford to be ill and hospitals are no longer viable business models. Innovation is sorely needed.

3. Solution in Dallas—In 1929 a group of Texas teachers and a local hospital offer it. The teachers of Dallas public system sign a contract with Baylor Hospital that offers them care if they make monthly pre-payments to the hospital. Baylor’s hospital administrator has concluded that if a large enough pool of teachers pay into the system, his hospital can not only sustain itself, but also afford to care for those who the teachers who did get sick or injured. The success in Dallas offers a model for others to implement.

4. Blue Cross emerges and explodes—In the early 1930′s Blue Cross, following the Dallas model, takes flight. The company is a non-profit dedicated to working on the public’s behalf; groups and workers are given community rates (meaning all the insured pay the same amount regardless of medical history), and no one is excluded. It’s influence spreads all over the United States, with affiliates follow the same strict non-profit guidelines. Dr. Ezekiel Emanuel writes in Healthcare Guaranteed, “Workers at one company subsidized those at another, the young supplemented the old, the healthy supplemented the sick and executives subsidized lower wage workers.” By the time WWII ends, Blue Cross and Blue Shield controls almost 80% of the private insurance market.

5. Health insurance goes commercial— Between 1940 and 1950 the number of persons enrolled in private health plans increases from 20.6 million to 142.3 million, according to the New England Journal of Medicine. Into the 1970′s private health insurance grows to the point where  it covers more than 80% of the population. With the success of the Blue Cross and Blue Shield, commercial insurers have begun to infiltrate the market in search of profits. By offering lower rates to companies with younger employees they are able to cherry pick the low risk population from the Blues. The system begins to fragment. Many employers welcome the cheaper premiums and cut ties with the Blues, who are struggling to keep up with the market. By the 1990′s  Blue Cross and Blue Shield folds under market pressure, and sign off on the conversion to for-profit status.

Tweet This Post