Medicare History

[brix11]

On his website and in his book, The Revolution: A Manifesto, Ron Paul asserts:

In the days before Medicare and Medicaid, the poor and elderly were admitted to hospitals at the same rate they are now, and received good care.

Can anyone provide some information to back up this claim? Any good books about the history of Medicare?

[Simplicio]

This article addresses hospital enrollment for the elderly:

Medicare quickly expanded access to care for the elderly. Hospital discharges averaged 190 per 1,000 elderly in 1964 and 350 per 1,000 by 1973; the proportion of elderly using physician services jumped from 68 to 76 percent from 1963-1970. Currently, more than 94 percent of elderly beneficiaries receive a health care service paid for by Medicare. Similarly, Medicare has improved access for disabled enrollees.

Also, the poverty rate for the elderly plummeted during the late 60’s, in part because, the elderly used to foot the bill for much of their own care:

In 1965, the elderly were the group most likely to be living in
poverty nearly one in three seniors were poor [Figure 4]. Today,
the poverty rate for the elderly is similar to that of the 18-64 year
old group about one in 10 is poor. Before Medicare was enacted,
the elderly paid 53 percent of the cost of their health care. That
share dropped to 29 percent in 1975, and 18 percent in 1997.

As a practical matter, Medicare/Medicad make up almost half of US medical spending. Even if doctors are really generous, its unlikely they could provide their current sevices with only half the revenue.

[gonzomax]

Medicare costs 100 bucks a month. Then it pays for 80 percent of the care.

[brix11]

Thanks, Simplicio. Paul’s statement did not exactly ring true for me.

[anson2995]

The article the OP links has a few good points in it, hidden amongst some rambling and often contradictory assertions. But I point specifically to the sentence immediately after the one the OP quotes (bolding appears at the web page):

In the days before Medicare and Medicaid, the poor and elderly were admitted to hospitals at the same rate they are now, and received good care. Before those programs came into existence, every physician understood that he or she had a responsibility towards the less fortunate and free medical care was the norm.

In his book (from which the quote is taken), Paul goes on to say…

Laws and regulations that inflated the cost of medical services and imposed unreasonable liability standards on medical professionals even when they were acting in a volunteer capacity later made offering free care cost-prohibitive, but free care for the poor was common at a time when America wasn’t so “governmentish” (to borrow a word from William Penn).

This is straight out of the Libertarian playbook, the belief that private charity will fill the need that government insists on filling, if only they were allowed to. (Trying not to stray into GD territory here, just stating the facts.) As a historical fact, though, it’s hard to find any evidence that supports that.

Paul cites as his source a book by prominent Libertarian David Beito called “From Mutual Aid to Welfare State: Fraternal Societies and Social Services, 1890-1967.” That book has no footnotes, but does have a 13 page “bibliographical essay.” I can’t discern the original source to support Paul’s claim. I’m very dubious.

[Yeah]

It wasn’t just the doctors providing free care for the poor (of all ages), it was the insured and non-poor patients who subsidized the care of the poor. All hospitals, many of them non-profit providers of a great deal of free care, padded the bills of the paying patients to cover the cost of providing charity care. Medicare was supposed to be a better way of covering the cost of medical care to the poor elderly. It also converted a lot of people from being charity cases to being paying patients (even if the government was covering most of the tab).

I’m sure there were some good things about the good old days when benevolent doctors and hospital administrators could decide who deserved charity care and how much they deserved, but soaking the paying patients wasn’t one of them and it seems likely to me that a lot of people put off needed care when they could only get is as a charity patient.

[Wesley_Clark]

As a caveat, health care was far far less expensive (both in real dollars and as a % of GDP) back before 1965, when medicare and medicaid were created.

So you can’t really compare health care access in 2011 with health care access pre-1965, which Paul is trying to do. Today a broken bone can cost thousands of dollars if you go to the ER, and minor outpatient surgery can run into 5 figures. That wasn’t the case in the 1950s. The elderly in the 1950s probably could afford to see a doctor or go to a hospital w/o medicare, today that is far less likely to be the case. So you have to factor that in too, medical access w/o medicare or medicaid from the 1950s and early 1960s won’t give you info on medical access in 2011 since costs are so much higher.

As for the history of medicare, I believe it is an offshoot of attempts at universal coverage that were started under FDR and Truman. Eventually it was settled somehow that the elderly and poor would get universal coverage instead of everyone (which sucks, life would be a lot better if those programs were universal) so medicare and medicaid were created in the 60s.