Healthcare in the U.S. Before Government Involvement: A Look at the Early 1960s

Back in the early 1960s, healthcare in the United States was notably less complicated compared to today. Providers and patients navigated a workflow that was simpler and more direct. Here, we explore how healthcare was managed and the costs associated with it during that era. This period sets the stage for the profound changes that would occur in the following decades.

Costs and Services

Healthcare costs were, relatively speaking, much lower. One vivid example comes from the author's grandfather, who died in the hospital in 1959. The bill for 2 days in the hospital, the use of the operating room, the anesthesiologist, and the surgeon totaled $356.00. This amount was comparable to a month’s pay, illustrating the affordable nature of healthcare at the time. In contrast, a similar situation today would see a much higher bill.

The author recalls an incident from his nearly half-century experience, when he fell and incurred a head wound. The emergency room visit cost over $2,000, while a similar injury in the late 1950s would have resulted in a $20 bill at the doctor's office. These stark differences highlight how the nature of healthcare provision has evolved.

Extended Care and Technology

Even in the late 1950s and early 1960s, healthcare was more than just a day's visit or an emergency. For instance, the author's mother spent 6 weeks at the Mayo Clinic in 1960, where the bill was $7,000, which included extensive tests and one operation. While this sum no longer would buy you two days of care, it reflected the significant advancements in medical technology.

It is important to note, however, that while care was more accessible and affordable, it was also more basic. X-rays were widely available, but MRIs and CAT scans were still in the developmental stages. The tools and technology used in hospitals then were vastly different from those of today.

Before the For-Profit Era

Before the implementation of for-profit health insurance in 1973, healthcare coverage was managed differently. Blue Cross and Blue Shield were both nonprofit organizations that provided coverage for major medical expenses. These plans were administered through employers, and many individuals could enroll without medical underwriting, making benefits accessible to a wide range of people.

Employers started providing coverage as a benefit in the 1940s, driven by the need to attract workers during World War II. During the post-war period, there was a push for medical coverage for veterans only, which was later extended to all Americans with the introduction of Medicare and Medicaid in 1965.

The Transition to For-Profit Insurance

The early 1970s marked a significant turning point in healthcare. For-profit insurance companies were granted the ability to offer medical plans in 1973. This change ushered in new models of care that focused on reducing administrative costs and premium bases specific to covered employees. The shift towards for-profit insurers brought about a new landscape in healthcare financing and delivery.

By 1967, the healthcare landscape in the United States had become more complex. For example, when the author’s daughter was born, the stay in the hospital was for five days, and the bill was $600.00, reflecting a more commercialized approach to healthcare services.

The transition to for-profit insurance was driven by increased complexity in healthcare technology and higher costs. While the change marked a significant shift, it also initiated a new era of competition and innovation in the healthcare industry. This change paved the way for the healthcare system we see today, with a mix of public and private insurance options.

Today, healthcare is a MCMC (Major Costly Medical Care) system with a mix of employer-based and individually purchased insurance. The emergence of for-profit health insurance has brought about various challenges and benefits, including increased premiums and more complex coverage.

Despite these changes, it is worth noting that healthcare costs have significantly increased in the decades following the 1960s. The rise of for-profit insurance and the increasing specialization in medical care have contributed to higher premiums and more intricate insurance plans.

Conclusion

The healthcare landscape in the United States has undergone a dramatic transformation from the early 1960s. While the healthcare provisions in that period were simpler and more affordable, the need for increased coverage and medical advancements led to significant changes. The groundwork laid in the 1970s, with the advent of for-profit health insurance, reshaped the entire healthcare system. It is crucial to understand these historical changes to appreciate the current state of healthcare in America.