President Lyndon Johnson Signs Medicare Bill

Speech excerpt

By: Lyndon Baines Johnson

Date: July 30, 1965

Source: "President Lyndon B. Johnson's Remarks with President Truman at the Signing in Independence of the Medicare Bill." Public Papers of the Presidents of the United States: Lyndon B. Johnson, 1965. Volume II, entry 394, pp. 811-815. Washington, D.C.: Government Printing Office, 1966. )http://www.lbjlib.utexas.edu/johnson/archives.hom/speeches.hom/650730.asp〉 (accessed February 1, 2006).

About the Author: Lyndon B. Johnson (1908–1973) served as the thirty-sixth president of the United States from 1963 to 1969.

INTRODUCTION

Until the early 1960s, elderly citizens in the United States were burdened with high medical expenses. Those citizens with low incomes or pensions were often hard-pressed to pay medical bills, and benefits provided by the Social Security Act of 1935 did not include certain medical coverage. The Medicare Bill—title XVIII of the Social Security Act, was passed in 1965 to ensure a comprehensive health insurance plan for the elderly. The act, which was signed into law by then president Lyndon B. Johnson, provided health coverage to most citizens aged sixty-five years and more.

Under the structure of Medicare, employees contributed a determined and relatively small portion of their salary towards health insurance. Employers also contributed. The accumulated sum over time enabled those reaching sixty-five years of age to be provided with hospital care, diagnostic care, and post-hospital home visits for certain periods, depending on the nature of the illness and/or care required.

Medicare consists of two main sections. The first section is known as Hospital Insurance (HI), or part A, which provides benefits during hospitalization. The second section is Supplementary Medical Insurance (SMI), or part B, which provides benefits for physician services, physical and occupational therapy, and some home health care.

Part A is generally provided automatically and free of premiums to persons age sixty-five or over who are eligible for Social Security benefits. Part A ensures pay for care in hospitals, skilled nursing homes, home health agencies, and hospice care. The period of care and benefits available vary depending on the type of care. For example, hospital care includes costs of a semi-private room, meals, regular nursing services, operating and recovery rooms, intensive care, inpatient prescription drugs, laboratory tests, x rays, psychiatric hospitals, and inpatient rehabilitation.

Part B of Medicare covers doctors' bills, out-patient medical care, and many other medical services not covered under Part A. These services include, as some examples, physician services, laboratory and other diagnostic tests, x-ray therapy, home dialysis supplies and equipment, ambulance services, flu, pneumonia, and hepatitis vaccinations. In addition, Part B also covers certain equipment that is certified to be medically necessary including wheelchairs, oxygen, and mobility aids such as a wheel chair.

All citizens enrolled under Part A are eligible for benefits under Part B on a voluntary basis, provided all services are either medically necessary or one of several prescribed preventive benefits. Any one who wishes to avail of these benefits must pay a monthly premium.

PRIMARY SOURCE

PRESIDENT LYNDON B. JOHNSON'S REMARKS WITH PRESIDENT TRUMAN AT THE SIGNING IN INDEPENDENCE OF THE MEDICARE BILL JULY 30, 1965

… It was a generation ago that Harry Truman said, and I quote him: "Millions of our citizens do not now have a full measure of opportunity to achieve and to enjoy good health. Millions do not now have protection or security against the economic effects of sickness. And the time has now arrived for action to help them attain that opportunity and to help them get that protection."

Well, today, Mr. President, and my fellow Americans, we are taking such action—twenty years later. And we are doing that under the great leadership of men like John McCormack, our Speaker; Carl Albert, our majority leader; our very able and beloved majority leader of the Senate, Mike Mansfield; and distinguished Members of the Ways and Means and Finance Committees of the House and Senate—of both parties, Democratic and Republican.

Because the need for this action is plain; and it is so clear indeed that we marvel not simply at the passage of this bill, but what we marvel at is that it took so many years to pass it. And I am so glad that Aime Forand is here to see it finally passed and signed—one of the first authors.

There are more than 18 million Americans over the age of sixty-five. Most of them have low incomes. Most of them are threatened by illness and medical expenses that they cannot afford.

And through this new law, Mr. President, every citizen will be able, in his productive years when he is earning, to insure himself against the ravages of illness in his old age.

This insurance will help pay for care in hospitals, in skilled nursing homes, or in the home. And under a separate plan it will help meet the fees of the doctors.

Now here is how the plan will affect you.

During your working years, the people of America, you, will contribute through the social security program a small amount each payday for hospital insurance protection. For example, the average worker in 1966 will contribute about one dollar and fifty cents per month. The employer will contribute a similar amount. And this will provide the funds to pay up to ninety days of hospital care for each illness, plus diagnostic care, and up to one hundred home health visits after you are sixty-five. And beginning in 1967, you will also be covered for up to one hundred days of care in a skilled nursing home after a period of hospital care.

And under a separate plan, when you are sixty-five—that the Congress originated itself, in its own good judgment—you may be covered for medical and surgical fees whether you are in or out of the hospital. You will pay three dollars per month after you are sixty-five and your Government will contribute an equal amount.

The benefits under the law are as varied and broad as the marvelous modern medicine itself. If it has a few defects—such as the method of payment of certain specialists—then I am confident those can be quickly remedied and I hope they will be.

No longer will older Americans be denied the healing miracle of modern medicine. No longer will illness crush and destroy the savings that they have so carefully put away over a lifetime so that they might enjoy dignity in their later years. No longer will young families see their own incomes, and their own hopes, eaten away simply because they are carrying out their deep moral obligations to their parents, and to their uncles, and their aunts…."

SIGNIFICANCE

Medicare, when first implemented in early 1966, covered most people with the age of sixty-five or more. However, by 1973, it was modified to include all people over sixty-five. Although the Medicare bill has undergone modifications since it was passed, the basic structure of the act remains the same. Beginning in January 2006, Medicare also offered a new prescription drug benefit program.

Medicare has become the largest health insurance program in the United States, and is often regarded as a significant success story in health care around the world. According to the Centers for Medicare and Medicaid Services (CMS), four million eligible citizens received hospital care totaling $2.4 billion under Medicare during the first year following implementation of the program, and 200,000 people also received home health services. As of 2006, according to the CMS, 95 percent of the sixty-five-plus population of the United States, or over thirty million people, are covered by Medicare.

By the year 2030, the amount of Medicare recipients in the United States is estimated to reach seventy-one million people, twice the current 2006 amount. As the Baby Boom population (babies born from 1945–1960) becomes eligible for Medicare and medical costs continue to rise, projected burdens on the system will challenge the ability of the Medicare system to provide its mandated services. Efforts to strengthen and modernize the Medicare system are underway and include streamlining paperwork, encouraging market-place competition from private health plans, and improving health care quality and efficiency.

FURTHER RESOURCES

Books

CCH Health Law Editors. Medicare Explained. Riverwoods, Ill.: CCH Incorporated, 2005.

Fenten, John H. and J. Stenken. All About Medicare 2005. Cincinnati, Ohio: National Underwriter Co., 2005.

Web sites

Centers for Medicare and Medicaid Services. "Medicare: A Brief Summary." 〈http://www.cms.hhs.gov/publications/overview-medicare-medicaid/default3.asp〉 (accessed July 15, 2005).

The White House. "Strengthening Medicare: A Framework to Modernize and Improve Medicare." 〈http://www.whitehouse.gov/infocus/medicare〉 (accessed July 15, 2005).