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[Coursework] Health Insurance, Private Market and (In)Equality (HPA101)

The inequality of living conditions is determined by deep social structures and processes. Inequalities are systematic and the result of social norms, policies and practices that tolerate or even favor an unfair distribution of power, wealth and other necessary social resources as well as access to them. This is particularly true with Health insurance in the United States.
Unlike other developed countries, in the United States, the right to Health Insurance is not acquired naturally as a result of a basic citizen's right, but is rather earned to the extent that citizens contribute financially. This contributory principle has played an important role in the debate on health policies and universal assurance, and continues to be a high point in justifying the exclusion of certain social groups. To better understand the debate about an inclusive system of universal health care along with the distribution of health care (including the influence of private markets), it was necessary to do additional research into some of the historical aspects of health insurance in the United States.
Decades after the creation of the first social security system in Germany, President Franklin D. Roosevelt announced his intention to create a similar program for U.S. citizens. This decision was mainly influenced by the aftermath of the Great Depression of the 1930s, which imposed a heavy economic burden on American families. The Social Security Act was signed in 1935. First, the law first established a pension system for workers over 65. In 1939 he extended benefits for dependents and survivors in the event of the worker’s premature death; in 1954 he implemented a disability insurance program, and in 1956 provided monetary benefits for disabled workers aged 50-65.
During the first decades of social security in the United States, the government directly participated in covering only one of the two dimensions of workers' health risk: protection against loss of wages due to illness or death. Health insurance to protect the worker against medical expenses accumulated due to illness was left to the private sector. Private health insurance in the United States began to develop after the 1920s, when costs for medical services, which were usually secondary, began to be more worrisome for the population and to pay similar attention to the loss of wages. The first private health insurance initiative was intended to cover hospital costs, and was due to a group of teachers from Dallas, Texas, who-in 1929- entered into a contract with Baylor University Hospital to provide up to 21 days of hospitalization for a fixed payment of $ 6 per year. This system of prepaid hospital services spread rapidly under the name of Blue-Cross plans that were sponsored by the American Hospitals Association. Similar prepaid systems were established in 1939 by groups of doctors to cover physician services, giving birth to Blue-Shield plans sponsored by the American Medical Association.
While initiatives by the American Association for Labor Legislation (AALL) to provide compulsory health insurance for all workers through social security emerged, they did not progress.  This reinforced the decision to distribute health insurance via the private market. The road taken by the government was to promote health insurance through incentives to the private sector. In early 1940, the federal government established a series of tax incentives for companies to offer health insurance to their workers. The Labor-Employee Relations Act, also known as the Taft-Hartley Act of 1947, placed health insurance as a component of labor benefits, and allowed the creation of health insurance for multiple employers, with the aim of ensuring coverage union employees during periods of temporary unemployment.
After World War II, thanks to the incentives of the Taft-Hartley Act, economic expansion and wage control, as well as the sales of private health insurance plans, increased notably through the largest and most powerful unions in the country. By 1954, nearly a quarter of private insurance purchases were trade union negotiations. However, as this system matures in the United States, the adverse outcome of this model was more evident. First, many types of health services were not covered by private insurance. Second, many people did not have any type of coverage; for example: workers in industries with weak unions, or non-unionized workers such as self-employed, small business, agricultural or domestic workers. Neither the unemployed population nor the population of retirement age were covered. By 1962, slightly more than 50% of the population aged 65 and over had some type of health service, and this was mostly only to cover hospitalizations.
While legislative initiatives to include health insurance within the social security system faded, private health insurance growth in the United States was strengthened by the development of the Blue Cross and Blue Shield plans and by its entry into the private health insurance market and its consolidation in the 1940s. The dominance of private health insurance would have permanent repercussions on the health system in the United States, since it would outline the role of government and social security in the health coverage of its citizens.
During the period from 1935 to 1952 the debate within the government against exclusively private health insurance became more fervent. In 1942, the Social Security Council expressed support for "a unified and comprehensive social insurance system, including health benefits." In 1943, what was the first of a series of bills that proposed compulsory health insurance funded with payroll taxes. The first bill did not thrive after vigorous opposition from the American Medical Association and the Pharmaceutical Research and Manufacturers of America, among other groups. The Wagner-Murray-Dingell bill of 1945 was the first national health insurance bill to be officially supported by a president. Despite President Truman's endorsement, and after an eight-year period of intense debate and opposition led by the American Medical Association, liberal congressmen, and several public figures inside and outside the government, the Wagner-Murray-Dingell bill was filed in 1952.
It would be until 1965 when an amendment to the Social Security Act would add two titles to offer public health insurance to the population over 65 and health care insurance to the poor. So President Lyndon B. Johnson signed the amendment into law on July 30, 1965, and created the national Medicare and Medicaid insurance systems with them.
The Medicare program was incorporated into the Social Security Act under Title XVIII, providing health coverage to social security recipients aged 65 or over. Medicare closed one of the largest gaps in the economic security of retirees, providing protection against the high cost of health. Originally, Medicare consisted of two separate programs. Part A, for hospital insurance, automatically covers every worker who is eligible for social security coverage of 65 years or older, and their dependents. Insurance premiums are covered entirely by social security, and cover hospital stay, stay in skilled nursing facilities, and asylum and hospice care. Part B, of supplemental medical insurance, is optional for any citizen of 65 years or older, or persons with disabilities, and does not require a history of social security contribution. It covers ambulatory services, diagnostic tests, radiotherapy, ambulance services and medical equipment. Insurance premiums are partially covered by social security, the beneficiary being responsible for both a percentage of the premium and copays and deductibles. While the original Medicare program covered a broad spectrum of medical care, as well as many services including preventive treatments relevant to this population as well as medicines were not included or were only partly covered. Again, the gaps discovered by Medicare public insurance were left to the private sector. Private insurance companies began offering Medicare supplement plans called Medigap.
The contributory principle establishes that the population, to the extent of its possibilities, must contribute economically to finance social security. However, in the United States this principle has usually been seen as a prerequisite for legitimizing the expansion of social benefits even for the low-income population. The conditioning of citizen rights to individual contribution is part of the fabric of American society and has been present in the widespread and bumpy debate about the incorporation of health insurance into American social security. Historically, the only socially acceptable way to obtain health benefits was through private negotiations between employees and employers. The amendment to the Social Security Act of 1965, which created the Medicaid medical assistance program, only perpetuated the vision of two paths of social policy: the path of rights gained through contributions, and the path of public assistance based on charity.
While the need for health reform rests on pragmatic grounds, because public health service expenditures are unsustainable and do not favor economic development; the ultimate foundation of health policies can not rest on instrumental reasons. In this regard, I consider that a strong moral justification of equity is required, which can not be reduced to an instrumental, utilitarian or pragmatic approach. These approaches, as we know, allow to sacrifice the welfare of the individual or the local community for the general welfare. Here is the need to ensure human rights, such as the right to health, respecting human dignity; of accentuating the social responsibility of the companies, multinationals, the governments, to empower civil society, especially to the most marginalized and less socially cohesive societies, to enable them to exercise their autonomy through democratic participation, and outside of bureaucracy, corruption, and conjunctures.
The understanding of the relationship between social inequality and health sheds light on how the social organization of material life even has psycho-social implications in health (chronic stress, social emotions and new diseases). The analysis on social inequality and health has made it possible to reformulate normative frameworks of justice in health while generating justified reforms of public policies in health. These policies have gained strength due to the limits of economic growth and the inequities resulting from the indiscriminate exploitation of individual benefits and public resources. And, while strengthening community relations, reciprocity and trust would avoid the psycho-social factors that produce disease; it is clear that the private market is the one of the main causes of these social inequalities.
Equality requires a strong non-discriminatory conception, which defends not only a postulated autonomy. Health reforms demand not only cultural and lifestyle changes, but fundamental policies aimed at universal income, participatory ownership, economic democracy, and market control for the elimination of inequalities.

"Universal health coverage is not possible without universal access."

Thanks for reading. 

International Labour Organization, “R069-Medical Care Recommendation, 1944 (No. 69)”, Website International Labour Organization, 1944-2012. Retrived from: Accessed on: October 6, 2017.

International Labour Organization, “C102-Social Security (Minimum Standards) Convention, 1944 (No. 69)”. International Labour Organization, 2012. Retrieved from: Accessed on: October 8, 2017.

The Henry J. Kaiser Family Foundation, “Key Facts about The Uninsured Population”, Website The Henry J. Kaiser Family Foundation, Estados Unidos, Kaiser Family Foundation, 2015. Retrieved from: Accessed on: October 6, 2017.

Stevens, Rosemary A. S. History and Health Policy in the United States: The Making of a Health Care Industry, 1948–2008. Social History of Medicine, Volume 21, Issue 3, 1 December 2008, Pages 461–483, October 2008. Retrieved from: Accessed on: October 10, 2017.

Summers, C. (N. D.), History and Health Policy in the United States: The Making of a Health Care Industry, 1948-2008, Industrial & Labor Relations Review, 2008, pp. 405-412.

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[Coursework] Health Insurance, Private Market and (In)Equality (HPA101)


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