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History of Medicare in the US

Paper Type: Free Essay Subject: Health And Social Care
Wordcount: 2718 words Published: 5th Aug 2019

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Health Care in America

When discussing the national health care crisis in America, we must mention, President Roosevelt (1912), whose proposal included health insurance and President Truman, who pushed the idea for a national health plan for all Americans during his presidency and gained steam (Anderson, 2018).  Six months into President Truman presidency, he wrote a letter to Congress asking them to create a health insurance plan open for all Americans (Anderson, 2018). Truman’s vision for this health coverage plan for Americans would pay for standard expenses such as doctor and hospital visits, laboratory services, dental care and nursing services (Anderson, 2018). Truman had no idea what would come about this push, but he knew that America had a problem and a possible solution so this action (push) is what’s needed. This being a bold move during this time and Truman’s drive for the topic seemed radical.   Although, Truman was unsuccessfully, the idea still stood, there was still a great need because two decades later a bill was signed into law for health coverage, even after President Kennedy failed attempt (Anderson, 2018).

The policymaking process in America is a continuous cycle of agenda setting, formulation, implementation, and evaluation. Let’s briefly discuss these four phases to understand how and why Medicare Part D has become so successful.

Beaufort Longest says it best, “agenda setting is a crucial initial step in the policymaking process, it describe ways in which a particular combinations of problems, possible solutions, and political circumstances emerge and advance to the next stage (Longest, 2016, p. 87). Keep this in mind; anyone can outline and write up a proposed bill, however only Congress can introduce it as a bill. A citizen that’s affiliated with a interest group can see a need that is beneficial to their neighbor, friend, and or family member, composes a summary in detail explaining the problem and solution with possible alternative solutions. Given to a congress member, they then become sponsors of the bill and introduce it to Congress. At any given time there can be many different problems or issues, resolutions, or modifications to current regulation pertaining to health.

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The second phase is formulation; in this phase the bill goes through carefully advised steps by the federal government for development in legislation called the legislative process. The legislative process is a series of steps the bill goes through to become law.  The will be referred to a committee in the House or Senate that will review the bill and either pass it a subcommittee if need be or kill it. The committee or subcommittee has the option to make changes to the bill after performing analytical study and research. If the bill pass and the committee or subcommittee votes on its recommendations the bill will then become a detailed written report, describing the intent and impact on existing laws and regulations. Floor action is then taken where congress debate and place their vote to accept, reject, or make changes to. In the formulation phase is where many bills die because of the rigorous steps it must pass.  If the bill still stands, rather amended or not by the House or Senate, it is sent to the President for final actions. If the President rejects a bill, the bill still has a chance because Congress can attempt to reverse the veto, requiring a two-thirds roll call vote of present members.

After the rigorous process of becoming law, the third phase is implementation. Implementing law requires management and evaluation of all finances, budgets and other resources that enable achievement of the goals and purpose of the law. It’s mandatory that we assess and analysis the progress or lack of progress that occurs when making a public change. Federal and state governments assign or in some cases create agencies, organizations and departments whose sole purpose is to carry out, maintain and bring to life the determined purpose of the law. During the implementation phase the law can change the physical and social environment people live and work in, people may experience behavior changes, and definitely the convenience of health services. Depending on the findings the bill can pose other problems and will need to be amended, which is why the policymaking process is a continuous cycle. If problems arise or the law is unsuccessful in fulfilling its purpose then modification will take place or the law will no longer be a law.

Decades in the making, Medicare as we know it day is the most popular federal government health insurance program because it provides benefits for America’s citizens aged 65 or older (Gapenski & Reiter, 2016).  Many Americans are unaware of who signed Medicare into law; President Johnson signed into law the bill that led to Medicare and Medicaid on July 30, 1965; and what is referred to as the “Original Medicare” consisted of only Part A, which is hospital insurance, and Part B, which is medical Insurance  (CSM, 2018). Individuals, who qualify for Medicare coverage receives access to physicians, hospitals or clinics, and other specialty doctors that accepts Medicare by paying a fee for each service—making Medicare a fee-for-service plan. An idea that took many years to create was finally fulfilled, from President Roosevelt’s platform to President Johnson’s signature making it a law.

The Evolution of Medicare

Getting an idea to become law is not an easy task in America. America policymaking decision is a daunting process that will require great strategy, beginning by identifying demander and suppliers. In America, demand and supply will flourish and evolve any business. The most effective demander in health policymaking are demanders, these are well organized interest groups or organizations whose sole purpose is to achieve their goal, by pooling together member resources and they are quite successful in what they do with the greatest impact than just individuals alone. It expresses the notion that working collectively will produce great gains in achieving outcome. Interest groups are used to speak for the people and to link the people with the government. With Interest groups as demanders, the government will supply or create a way, such as passing a bill or law to fulfill the demanded. Once an idea shows a great demand and supply it is then placed on the agenda for discussion. Policymaking is a cycle of formulation, implementation, and modification. This health care plan is now in the formulation phase, that’s composed of two parts: agenda setting and development of legislation or bill.

Agenda setting is the start of legislation. The idea must pose a problem, have a plausible solution and possess potential political circumstances. Check, check, and check; health care affordability will always be on the forefront in America. Health care is a concern then and that still stands true today.

At the time Medicare became law seniors was the population group living in poverty and about half were uninsured at the time (CSM, 2015).  During the implementation phase of Medicare, the Social Security Administration (SSA) was reorganized and the Bureau of Health Insurance was established on July 30, 1965 and by July 1, 1966 there were 19 million individuals enrolled (CSM, 2015). Years later after the use of analytical tools, Medicare made the modification to extend its eligibility to individuals under age 65 with long-term disabilities and to people living with end-stage renal disease (ESRD), and the process continues with implementing the new modifications until a new modification arise because many variable arise that can affect the current decision, like situations, preferences of individuals, science, technology, cultural and economic.

Thus far we have seen an idea manifest into law, Medicare has progressed tremendously since Congress established it in 1965. Over the years, Medicare has developed into four parts: Part A, which provides hospital and some skilled nursing facility coverage; Part B, which covers physician services, ambulatory surgical services, and outpatient services; Part C, which is manage care coverage offered by private insurance companies; Lastly, Part D, which covers prescription drugs (Gapenski & Reiter, 2016).

How is Medicare funded and how does it work?

Within the United States Department of Health and Human Services is a federal agency that runs Medicare—Centers of Medicare and Medicaid (CSM). Medicare is funded by a percentage of taxpayers money and by monthly premiums paid by recipients or beneficiaries, some older beneficiaries pay their monthly premiums by getting it withheld from their Social Security checks. In America employers and employees pay taxes and every year the government dictates how the taxes receive is allocated, but let’s also note that in 2015, there were 7.2 million Medicare beneficiaries who were QMBs (qualified Medicare beneficiaries), and Medicaid funding was being used to cover their Medicare premiums and cost-sharing, which is a great way to take the pressure off of American taxpayers (Anderson, 2018).

Focusing on Part D

Original Medicare, Part A and Part B does not cover prescription drugs, although in some cases drugs such as immunosuppressive drugs (for transplant patients) and oral anti-cancer drugs are covered, but at case by case situations (eHealthInsurance Services, Inc. , 2018).

In December of 2003, President Bush signed the Medicare Prescription Drug, Improvement, and Modernization Act (MMA), which modified the program to provide Medicare coverage of outpatient prescription drugs.  Prior to Medicare Part D, individuals were using discount cards to purchase their prescriptions at a lower cost or receiving a limited supply from their physician and some individuals was not receiving medications at all, due to the high cost of them and not being able to afford them. Until the passing of Medicare Part D, about 25 percent of beneficiaries receiving Medicare coverage did not have a prescription drug plan at all (Anderson, 2018).

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In U.S. legislation, in order for an idea to become a bill, there must be a need for it and there is surely a need.  Because of the creation of the new outpatient prescription drug benefit through private health plans as a option, MMA created competition among other health plans to embrace revolution and flexibility in coverage use, to covered new precautionary benefits, and to make numerous other changes. As implementations were underway, Medicare had 39 million beneficiaries enrolled (CMS, 2015, pg.8). Medicare Part D was not only beneficial to its beneficiaries but to its stakeholders as well. Physicians and pharmaceutical manufacturers and research organizations also capitalized on the new health coverage benefit of prescription drugs.  Medicare Part D was charged with two tasks, to make prescription drug coverage plans available and affordable.

 The Kaiser Family Foundation found that, in 2019, there will be 901 stand alone prescription drug plans available, which is a 15 percent increased of available prescription drug plans from 2018 and of the 901 stand alone plans, 215 will be without a premium to enrollees receiving a low-income subsidy or benchmark plan (Kaiser Family Foundation, 2018) Also come 2019 there will be a decrease of out of-pocket cost beneficiaries pays for brand name prescriptions drugs, in 2018 beneficiaries paid 35 percent, but in 2019 they will pay 25 percent (Kaiser Family Foundation, 2018). That’s a 10 percent out of-pocket savings for beneficiaries. Small victory.

One way Medicare Part D can help lower government spending of prescription drug is to drive the use of generic drugs. Generic drugs are less expensive than brand name drugs but what’s the issue, why don’t people like to buy generic drugs? Well I’ll tell you people don’t buy because by it being less expensive they feel like it is less quality. When stakeholders begin to capitalize on the use of generic drugs and make it a priority then government spending on drug cost will decrease. I believe its possible because people’s perception of generic drugs has changed. Personally, past years, I would only buy brand name drugs, but due to economic changes and a leap of faith on a few over the counter generic drugs I have found that generic drugs work just the same as expensive brand name drugs.

Medicare Part D has also lower hospital stays, meaning that now people can afford prescription drugs (brand name or generic), they are less likely to be admitted for issue that are preventable, lessening the use of Medicare Part A and Part B claims.  Smart changes in one area will become positive changes and benefits in other areas.

Medicare Part D has taken the financial burden off many senior citizens and given them the ability to have a happier healthier life.

This country has fought for health care plans like this for many decades. It started with the continuous efforts from past presidents who saw a need. Passing the rigorous policymaking process…now that was a shocker for me. I am shocked it passed because the decision-making process of policymaking gives so many opportunities for a bill to fail or get denied. But for Medicare to have passed says a lot about the future of America’s health and politics. Medicare Part D has helped to provide good health for seniors, lessening the financial stress and burden. Having the ability to afford prescription drugs and medication is not a luxury it’s a right.

With all of the achievements Medicare Part D has had it does not surprise me that it is America’s #1 Prescription drug plan available. It has taught us that you do not have to end policies to get the job done you simply amend it. Medicare has paved the way for other regulations like the Affordable Care Act. I am amazed at how far America has come pertaining to health care cover let alone prescription drug coverage. Although Medicare Part D has made amazing strides to improve the health of its beneficiaries, I would raise the bar even higher by increasing the enrollment of Part D. I would not be satisfy until everyone over the age of 65 are enrolled in a prescription drug plan—making it “mandatory” for seniors because when you are 65 or older you will need a prescription drug to prevent illnesses of treat. The older you get the more you body need to be reinforced with a good bill of health. 


  • Anderson, S. (2018). A brief history of Medicare in America. Retrieved December 8, 2018, from https://www.medicareresources.org/basic-medicare-information/brief-history-of-medicare/
  • CSM. (2018). 2019 Medicare Advantage and Part D Prescription Drup Program Landscape. Retrieved from https://www.cms.gov/newsroom/fact-sheets/2019-medicare-advantage-and-part-d-prescription-drug-program-landscape
  • CSM. (2015). Medicare and medicaid milestones. Retrieved from https://www.cms.gov/About-CMS/Agency-Information/History/Downloads/Medicare-and-Medicaid-Milestones-1937-2015.pdf
  • eHealthInsurance Services, Inc. . (2018). Original Medicare, Part A and Part B. Retrieved December 10, 2018, from eHealth Medicare: https://www.ehealthmedicare.com/original-medicare-articles/originalmedicare/
  • Gapenski, L. C., & Reiter, K. L. (2016). An Introduction to accounting and financial management. Chicago, Illinois: Health Administration Press.
  • Kaiser Family Foundation. (2018). An overview of the medicare part d prescription drug benefit. Retrieved December 9, 2018, from Henry J Kaiser Family Foundation: https://www.kff.org/medicare/fact-sheet/an-overview-of-the-medicare-part-d-prescription-drug-benefit/
  • Longest, B. B. (2016). Health policymaking in the United States. Chicago, Illinois: Health Administration Press.


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