Chapter 8: Public Health Insurance Programs | Article

History of Insurance—Medicare Law

President Lyndon Johnson signed Medicare and Medicaid into law in 1965. He stood next to former President Harry Truman at the signing to honor Truman's leadership on the issue. Truman first proposed public health insurance in 1945.

One of Truman's first acts as president was to propose a new national health-care program. It was to be an optional program that Americans could join if they chose. He had five goals in mind:

• to bring health professionals to rural and low-income areas through federal funding;
  
  
  
• to construct more hospitals and create national standards to ensure their quality;
  
  
  
• to create a board of doctors and hospitals to develop standards and ensure hospitals met them; and
  
  
  
• to create a national health insurance fund to be run by the federal government.
  
  

National health insurance was forcefully criticized by the American Medical Association. The group played on public fears of Communism of the era, charging that Truman's idea of national insurance was socialized medicine. The outbreak of the Korean War ultimately forced Truman to abandon his push for national health care.

When President Lyndon Johnson signed Medicare into law in 1965, he enrolled President Truman as the first Medicare beneficiary and presented him with the first Medicare card.