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Health Care Policy of the Democratic Party
By Steve Hoenisch
Last updated on July 23, 2004
Copyright 1996-2008 www.Criticism.Com
This essay appears in The Encyclopedia of the American Democratic and Republican Parties, published by the International Encyclopedia Society. The encyclopedia won the Choice Outstanding Academic Book Award in 1997.
Table of Contents
1 Early Proposals
2 Franklin D. Roosevelt's Social Security Bill
3 Truman Advocates for Legislation
4 Eisenhower Thwarts Compulsory Insurance
5 Kennedy's Social Welfare Platform
6 Lyndon B. Johnson's War on Poverty
7 Medicare and Medicaid Established
8 Reagan Attacks
9 Clinton's Plan
10 Rifts Lead to Other Proposals
12.1 Democratic Party
12.2 Republican Party
13 Bestselling Books on the Democratic Party
Although the early proposals for federal health care were tendered by Republicans, health legislation soon became the domain of Democrats, who increasingly encountered opposition from Republicans weary of enlarging central government. With his proposals to expand the Public Health Service in the 1920s, Democratic Senator Joseph E. Ransdell opened the way for later generations of Democrats to fight for augmenting the federal government's role in health care. But these later generations of Democrats, often composed of Northern, liberal, and pro-labor congressman, found significant and often decisive resistance from conservative Southern Democratic brethren.
Federal health care began in 1798 with an Act for Relief of Sick and Disabled Seamen, which created the Marine Hospital Service, the progenitor of the Public Health Service, the name that the agency took following passage of the Public Health and Marine Service Act of 1902. The bill was enacted after Republican Senator John C. Spooner of Wisconsin asked for changes in the public health service. But partisan politics over health care did not take hold with full force until the beginning of 20th century.
In 1926, Democratic Senator Ransdell of Louisiana, the chairman of the Public Health Committee, introduced a bill to create a national institute of health. The proposal, however, languished in Congress for four years, encountering indifference from many members of Congress and facing determined opposition from Republican President Calvin Coolidge's Bureau of the Budget. During 1928, the Ransdell bill was also being kicked around the Senate, but Republican Senator Reed Smoot of Utah, an early opponent of federal health care, prevented its passage.
Also in 1926, Republican Representative James S. Parker of New York introduced a bill to expand the authority and services of the Public Health Service. In 1928, the Parker Bill passed both houses only to be vetoed by Republican President Calvin Coolidge over the question of executive authority.
In 1930, both the Parker and Ransdell Acts became law, determining the direction of the Public Health Service for the next 40 years. The Parker Act, officially known as the Public Health Service Amendments of 1930, enhanced the authority and operations of the service. The Ransdell Act was officially known as the National Institute of Health Act. The passage of the acts helped open the door for the more extensive health care proposals that were to follow.
In 1937, several Democrats teamed up to pass an act establishing and funding a cancer institute. The National Cancer Institute Act, which passed both houses unanimously, was proposed by Representatives Maury Maverich, a Texas Democrat, and Warren G. Magnuson, a Washington Democrat, as well as Senator Homer T. Bone, also a Washington Democrat.
Democratic President Franklin D. Roosevelt, with the backing of other Democrats in his administration, brought up the subject of a government health insurance program when he proposed his social security bill of 1935. But Roosevelt, fearing that such a controversial issue could endanger the overall social security bill and his chances of reelection, let the issue wither. Despite the lobbying efforts of some progressive Democrats for an expansion of federal health services and compulsory insurance, Roosevelt's New Deal included few other attempts to significantly expand federal health care, though it did manage to get aid for maternal and children's health and matching grants for state health departments. Yet it was Roosevelt's vision of a government health insurance program that formed the progenitor of the 1965 Medicare Act.
Further into the years of the New Deal, a rift emerged on health care within elected members of the Democratic Party. Between 1939 and 1943, three Northern Democrats -- Senators Robert F. Wagner of New York and James E. Murray of Montana and Representative John D. Dingell of Michigan -- repeatedly introduced measures for national health insurance. The bills, however, did not have strong support from the Roosevelt administration, which continued to be fearful that such controversial legislation could doom other aspects of its agenda. But the absence of administrative backing was not the bills' demise. Rather, they were blocked by conservative Southern Democrats, who had formed a strong coalition with Republicans.
The next battle over health care came in 1946, when Democratic Senators Lister Hill of Alabama and Harold H. Burton of Ohio introduced a bill to help defray the costs of hospital construction.
Senator Hill dedicated much of his Congressional career to proposing and fighting for health care legislation. As chairman of the Senate Committee on Labor and Public Welfare, Hill, working with Democratic Representative John E. Fogarty of Rhode Island, persuaded Congress to expand the National Institutes of Health into a comprehensive facility for medical research. Along with Representative J. Percy Priest, Democrat of Tennessee, and Senator Claude Pepper, Democrat of Florida, Hill was instrumental in moving the National Mental Health Act of 1946 through Congress.
But the influential Senator Robert A. Taft, an Ohio Republican, frowned upon the Hill-Burton bill because, he believed, it allowed for too much federal control. In order to gain his backing, Senator Taft wanted the measure to contain assurances of states rights and local control, money set aside according to state assessments of need, and matching funds for local hospital boards.
Within the Democratic Party, it was significant that Senator Hill, a Southerner, had introduced the bill. The measure appealed to many Southern conservatives in Congress, both Democrat and Republican, because it promised to funnel aid to their states. Even Senator Taft was eventually persuaded to back the bill by a funding formula that awarded the largest sums to the poorest states. The Hill-Burton Act, officially known as the Hospital Survey and Construction Act, became law in 1946.
Democratic President Harry S. Truman was a strong advocate of health care legislation. In his state of the Union speech of 1948, Truman announced that his goal was "to enact a comprehensive insurance system which would remove the money barrier between illness and therapy." For Truman, national health insurance was an issue of equality.
In early 1949, President Truman urged Congress to act on medical insurance. Soon thereafter, a bill drafted by Democratic Senators Wagner and Murray along with Democratic Representative Dingell was again presented to Congress, as it had been during previous years, when it usually met with Congressional refusal to hold hearings on it. The fate of the 1949 bill was much the same. Despite backing from President Truman, the bill met with strong opposition from a coalition of anti-Truman conservative Southern Democrats. They combined forces with Republicans to successfully block the insurance proposal; it was never reported out of committee.
Despite the dashed hopes for President Truman's insurance legislation, a group of Democrats teamed up with a Republican to gain passage of two acts that provided funding for medical research. Surgeon General Leonard Scheele joined Democrats Mary Lasker, Murray, and Pepper as well as Republican H. Styles Bridges of New Hampshire to pass the National Heart Institute Act in 1948 and the Omnibus Medical Research Act of 1950, which established new institutes for health research. The acts are indicative of Congress' strong bipartisan support at the time for medical research, which continued through the 1950s, resulting in increased funding for the National Institutes of Health in 1957 and 1958.
In 1950, '51, and '52, President Truman continued to push for compulsory health insurance. But the prospects for passage appeared bleak after 1949, as even Truman's advisers acknowledged, especially after the elections of 1950 reduced the Democrats' House majority from 263-171 to 235-199 and scarcely allowed them to maintain control of the Senate.
The 1952 election that installed Republican Dwight D. Eisenhower as president shattered all possibility of a Northern Democrat-supported compulsory insurance bill. In fact, under President Eisenhower, no substantial medical bill had a chance. Even after the Democrat Party regained control of Congress in 1954, the Democrats still lacked enough votes to ensure a favorable majority.
The year 1958 rekindled the debate over a national health insurance program. During that year, Aime J. Forand, a Rhode Island Democrat and a member of the House Ways and Means Committee, where at least one earlier proposal for national health insurance had died a quiet death, reintroduced an insurance bill. During the 1950s, statistics began to show that the aged had health and financial problems. Despite the statistics, the Forand Bill drew opposition from conservative members of Congress, including some Democrats, who argued that it was regressive and limited. They objected that it would not offer substantial assistance to those who needed it most while covering those who did not. Opponents further argued that Americans are not poor enough to warrant compulsory government health insurance. They added that the bill would encroach on states' rights, a oft-used objection by Republicans. Many Southern Democrats, though, also held states' rights in high regard, one reason they often found themselves voting with Republicans on issues of social welfare policy. Although Forand's bill was rejected by the House Ways and Means Committee in 1959 by a 17-8 vote, it did serve to revive the battle over federal health care.
In the wake of the Forand Bill, Senator Robert S. Kerr, an Oklahoma Democrat, and Democratic Representative Wilbur D. Mills of Arkansas, the powerful chairman of the Ways and Means Committee, sponsored and gained passage of a compromise bill in 1960 that gave states matching funds to help the needy.
An increasingly significant federal role in health care emerged with the dawn of the 1960s and the presidential election of Democrat John F. Kennedy, who campaigned on a strong social welfare platform. The Democratic Party platform of 1960 included a section on health that proposed to use the Social Security system to cover the hospital bills of those in need and to make it available to all retired persons without a means test.
In February 1961, true to his party's campaign promises, President Kennedy called for an extension of Social Security benefits to cover hospital and nursing home costs but not surgical expenses for those over 65. Senator Clinton P. Anderson, a New Mexico Democrat who was a high-ranking member of the Finance Committee, and Representative Cecil R. King, a California Democrat who sat on the Ways and Means Committee, introduced the president's proposal as the King-Anderson Bill.
The bill, however, lacked bipartisan backing, and Representative Mills, though a Democrat, was determined to consider in the crucial Ways and Means Committee only a proposal that had bipartisan support. Besides, the Kerr-Mills program was already in place, and it was unlikely they would cave in to the president's plans. Of course, President Kennedy could have chosen to pressure Chairman Mills into supporting the King-Anderson bill, but Medicare was only one of the president's priorities. As Mills had agreed to introduce several of the president's other measures, Kennedy could not demand Mills' support for the health bill. Democratic Representative Sam Rayburn of Texas, the Speaker of the House, however, did support the president's proposal, but that support would not be enough to overcome the influential Mills.
Besides Mills, there was another significant barrier to passage of the King-Anderson Bill. It was a coalition of five other Southern Democrats on the House Ways and Means Committee who, together with Republicans, formed a bloc strong enough to override the favorable votes of the committee's urban, pro-labor Democrats. The six "swing" Southern Democrats on the committee who opposed or were likely to oppose the Medicare bill in 1961 were Mills, a publicly announced opponent; Burr Harrison of Virginia, a conservative; John Watts of Kentucky; Frank Ikard of Texas, who had conservative tendencies; A. Sydney Herlong of Florida, who also tended to vote conservatively; and Representative Frazier, another conservative.
The aggregation of these factors -- opposition from the committee's Southern Democrats, especially Chairman Mills, President Kennedy's focus on other priorities, and the fact that the Kerr-Mills program was already in place -- effectively killed the Medicare bill without a formal committee vote. But the battle for a national program of health insurance was not over yet; it was only postponed.
Following the assassination of President Kennedy, the ascendancy of Democrat Lyndon B. Johnson to the White House brought a liberal administration committed to social reforms as part of a "War on Poverty." The Democratic Party's platform in 1964 contained a demand for including hospital care for older Americans in the Social Security program. More specifically, President Johnson's dramatic victory over Republican candidate Senator Barry Goldwater of Arizona could be seen as a popular mandate for Medicare, for Johnson had included a strong Medicare plank in his campaign while Goldwater had not.
The 1964 Democratic landslide also placed in Congress liberal Democrats who not only firmly supported the administration but also were interested in health legislation, greatly improving the prospects for a Medicare bill.
More important, the composition of the House Ways and Means Committee had changed during the preceding elections; three of the conservative Southern Democrats who had opposed Medicare in 1961 had been replaced by fellow Southern Democrats willing to back the King-Anderson bill. Richard Fulton, Pat Jennings, and Clark Thompson supplanted Frazier, Harrison, and Ikard. Moreover, following the 1964 election, the committee's ratio was changed to reflect the strength of the parties in the House as a whole, increasing the number of Democrats on the committee. Thus, in 1965, the Ways and Means Committee shifted from 15 Democrats and 10 Republicans to 17 Democrats and 8 Republicans, further ensuring a bloc favorable to Medicare. The fate of the reintroduced King-Anderson bill had changed from being a possibility to a certainty. The bill continued to include coverage of the aged, limited hospitalization and nursing home insurance benefits, and social security financing.
Republicans reacted to the reintroduction of the King-Anderson measure by starting to talk about alternative programs that they saw as more positive. The Republicans put forth the following arguments as grounds for opposing the King-Anderson Bill in favor of an alternative: It contained inadequate benefits, with too many exclusions and limits; it was too costly; and it did not distinguish between the poor and wealthy among the aged. To address these concerns, Republican Representative John W. Byrnes of Wisconsin, the ranking Republican on the Ways and Means Committee, proposed a bill for a voluntary system. Byrnes' bill was also driven by the desires of Republicans on the Ways and Means Committee to prevent the Democrats from taking exclusive credit for health insurance legislation.
Representative Mills, foreseeing that passage of the King-Anderson Bill was now inevitable, sought to build bipartisan consensus for it. In a brilliant legislative move that at once strengthened the proposal and brought Republican backing to it, Mills moved to draft legislation combining the King-Anderson hospital insurance bill with Byrnes' voluntary plan and an expanded state-administered Kerr-Mills program for all medically needy people. Thus Mills' succeeded in winning bipartisan support for his combination bill because it appealed to the Republicans, many of whom wanted, at most, a voluntary plan.
And Mills continued to guide the legislation through the House with expertise and diplomacy. "Throughout" the drafting of the combination bill, Theodore R. Marmor writes in The Politics of Medicare, "Mills left no doubt that he was first among equals--he acted as the conciliator, the negotiator, the manager of the bill, always willing to praise others, but guiding the `marking up' of H.R. 6675 through persuasion, entreaty, authoritative expertise, and control of the agenda." The combination measure became known as the Mills bill, and when the House convened on April 8 to vote on it, Mills received a standing ovation.
Yet Despite Mills' labors, in October 1964, a deadlock over the entire social security bill again postponed the possibility of Medicare until the following year.
In 1965, the Social Security Amendments of 1965 passed both houses and were signed into law by Democratic President Johnson, establishing Medicare and Medicaid and ending with victory for the Democratic Party a long, bitter fight for health insurance that began with the Roosevelt administration and spanned the administrations of Presidents Truman and Kennedy and part of Johnson's. Perhaps the most far-reaching health care legislation passed in U.S. history, the amendments included a hospital insurance program for Social Security recipients over 65, funded from payroll taxes, and voluntary medical service insurance for the same group, funding by small premiums and general revenues. It also expanded the Kerr-Mills program for all medically needy people.
The battle of a federal health insurance program, however, did not end with the passage of Medicare and Medicaid. The battle merely shifted -- to what the appropriate level of funding for such programs should be. The origins of Medicare during the 1960s also shaped the dispute over national health insurance in the 1970s, an era during which health policy continued to have strong appeal in Congress. Senator Edward M. Kennedy, a Massachusetts Democrat, and Representative Paul G. Rogers, a Florida Democrat, played key leadership roles on health legislation. Kennedy in particular has been the leading congressional advocate during the past quarter century for a universal health care system. In the 1970s, Senator Kennedy focused his efforts on passing a universal health care measure, but his attempts failed because a compromise could not be reached on the issue.
In 1971, President Nixon suggested a plan to cut health care costs and to spur development of health maintenance organizations for providing care for Medicare and Medicaid recipients. Although the plan eventually lost favor with the White House, it was embraced by several influential Congressional Republicans and Democrats, notably Senator Kennedy and Representative Rogers. Working with several key Republicans in Congress, they adopted Nixon's plan. After three years of legislative effort, the Health Maintenance Organization Act of 1973 established an experimental program to underwrite HMO development, becoming a forerunner to the debate over stimulating HMO development and use during the 1990s.
In 1972, President Nixon announced that he intended to end federal backing for the Hill-Burton Act and several other programs and to cut funding for other programs. He also said he would revoke funds already appropriated to certain health care programs. Congress reacted with anger, passing amendments to secure appropriations. Congress eventually secured the grant programs at least temporarily in the Special Health Revenue Sharing Act of 1975, passed over Republican President Ford's veto. Many members of Congress, resenting Ford's tactics, backed the congressional health care leaders.
The late 1970s saw the election of Democrat Jimmy Carter to the presidency and a simultaneous respite from the health care debate. During the 1970s, however, many in Congress, particularly Republicans, became increasingly concerned over the rising costs of health care and voiced those concerns during hearings.
Republican President Ronald Reagan, soon after his election in 1981, launched an assault on the federal health care system, announcing that he planned to consolidate all 26 the health services programs into two block grants. He also announced plans to slash spending on health by 25 percent. The president's announcement set off a battle in Congress, with Senator Kennedy, the Massachusetts Democrat, and Representative Henry A. Waxman, a California Democrat who was the new chairman of the House Health Subcommittee, leading the charge to retain federal health programs.
Despite formidable opposition from both conservative Republicans and conservative Democrats, Representative Waxman managed to negotiate three block grants and to retain several programs as categorical grants in the Omnibus Budget Reconciliation Act of 1981. But in the end the conservatives had won. The act reduced funding for all health services programs, collapsed funding for many categorical grant programs into block grants to states, and increased local and state governance over remaining programs.
One of the few victories during the conservative era that spanned the twelve years of the Reagan and Bush administrations came in 1991, when a coalition of three congresswoman joined forces to pass the Women's Health and Equity Act. Senator Barbara Mikulski, a Maryland Democrat, and Representative Patricia Schroeder, an influential Colorado Democrat, were instrumental in securing passage of the bill, which created an office for research on women's health at the National Institutes of Health.
The election of Democratic President Bill Clinton returned health care to the fore of national politics in 1992. Clinton ran on a plank of reforming the nation's health care system. Once elected, Clinton's goal soon became universal coverage, arguing that it was necessitated by rising costs of care and large numbers without insurance. True to his campaign promise, he unveiled a health care reform proposal in a speech to Congress and the nation on Sept. 22, 1993, saying that Hilary Rodham Clinton had consulted with government leaders of both parties and that many of the plan's principles had been embraced by Republicans as well as Democrats. He proposed a concept first conveyed by Republican President Richard M. Nixon -- that every employer and individual would be asked to contribute to health care.
Clinton's proposal would require that all legal residents be insured by choosing from at least three plans providing standard medical benefits: an HMO, a fee-for-service, or a combination plan. The plans would be administered by large corporate employers or by regional purchasing alliances. Employers would pay 80 percent of the insurance cost while individuals would pay up to 20 percent. There would be subsidies for small, low-wage employers and poor individuals. Clinton maintained that his plan would deliver security, simplicity, savings, and quality while retaining freedom of choice.
Also among the principles of Clinton's plan was an expansion of states' responsibilities. Other Democrats, however, have been distrustful of states' abilities to ensure high-quality health care. For example, Democratic Representatives Pete Stark of California and Waxman have written during the 1990s detailed laws outlining states' responsibilities to help low-income earners, nursing home residents, pregnant women, and children.
Despite Clinton's assurances of support for his plan from Democrats and Republicans alike, rifts soon developed not only between the two parties but also -- and significantly -- within the Democratic Party, spawning three separate Democratic proposals, including Clinton's, and three additional Republican ones.
A major split within the Democratic Party was between the backers of the administration plan and backers of a single-payer system, meaning a government-run universal health care system like Canada's. The split was significant because many analysts believed that for the Democrats to pass a plan, they needed to include those committed to extensive reform.
Backers of the single-payer system -- generally liberal Democrats -- argued against Clinton's plan on the grounds that managed competition was untested, overly complex, and possibly inefficient compared with a single-payer system. Many liberal Democrats also feared that money would be diverted from Medicaid and Medicare to help pay for Clinton's plan.
The single-payer system was proposed by Representative Jim McDermott, a Washington Democrat who has been pushing for a government-run program for some time. McDermott's plan would give all legal residents access to a standard medical benefits package, administered by the states, with the government paying the bills. It would cover all medically necessary procedures. The program would be funded through payroll taxes on employers; individuals would pay nothing. Supporters of McDermott's plan included Representative Stark, the California Democrat who was chairman of the House Ways and Means Subcommittee on Health. Among the 60 other advocates of a single-payer system in Congress is Democratic Senator Paul Wellstone of Minnesota, a cosponsor of the legislation. Wellstone and the other backers argue that Canada's system, in which federal and provincial governments share costs, is a proven and generally successful way of providing citizens with fairly high-quality care. They also argue that taxpayers would be willing to back a single-payer system once they realize that it would replace all other health insurance costs, adding that managed competition will actually prove more burdensome for consumers. The proposal for the single-payer system, however, led many in Congress to raise questions about rationing. Conservative Democrats and Republicans alike consider a single-payer system akin to socialized medicine.
A third plan was proposed by a conservative Democrat, Representative Jim Cooper of Tennessee. It would establish purchasing cooperatives to reduce the cost of insurance and make it more affordable. The government would pay premiums of those below the poverty line and subsidize others in need. Cooper believed the virtues of his more conservative plan lay in less federal bureaucracy and control. Conservative Democrats had criticized Clinton's plan as containing excessive controls. They also had concerns over requiring small businesses to buy insurance for their employees. Cooper's alternative would require no payments by employers.
But along with the other plans, Clinton's initiative died in Congress, unable to survive challenges from the strong Republican minority, which had garnered frequent support from conservative Democrats. The nearly century-old split in the Democratic Party between conservatives and liberals that had for so long undermined Medicare and stalled other federal health care proposals by liberal Democrats had struck again. Indeed, the death of Clinton's plan left unresolved the issue of health care and extent of government involvement, as it has remained since the early days of the 20th Century.
Bacon, Donald C.; Davidson, Roger H.; Keller, Morton; editors. The Encyclopedia of the United States Congress, New York: Simon & Schuster, 1995.
Eckholm, Erik, editor. Solving America's Health-Care Crisis: A Guide to Understanding the Greatest Threat to Your Family's Economic Security, New York: Times Books, 1993.
Johnson, Donald Bruce. National Party Platforms: Volume II, 1960-1976, Urbana, Ill.: University of Illinois Press, 1978.
Maisel, L. Sandy, editor. Political Parties and Elections in the United States: An Encyclopedia, New York: Garland Publishing Inc., 1991.
Marmor, Theodore R. The Politics of Medicare, Chicago: Aldine Publishing Co., 1973.
Porter, Kirk H. and Johnson, Donald Bruce. National Party Platforms: 1840-1964, Urbana, Ill.: University of Illinois Press, 1966.
Stevens, Robert and Stevens, Rosemary. Welfare Medicine in America: A Case Study in Medicaid, New York: Macmillan Publishing Co., 1974.
The New York Times, Health Care: Clinton's Plan and the Alternatives. New York: Sunday, October 17, 1993. Page 22.
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