Throughout my childhood in the 1960s, my mother sat at the kitchen table once a month and wrote a check to Dr. Gnade, our family physician.
I assume that she caught up periodically, but owing him something was the normal state of affairs. In 1960, 60 percent of physician fees and nearly half of all health dollars came from the pockets of patients. We had health insurance, sure, but it was “major medical”—the plan paid 80 percent of the cost of hospitalization and we paid the rest. Twenty percent of the cost of my father’s 1969 heart bypass surgery was still a considerable sum.
The Great Society programs of Lyndon Johnson (creeping socialism!), began a sea change in health care finance.
The public health insurance share rose from 5 percent in 1965 to 21 percent only two years later. Today, the out-of-pocket share is 11 percent and public health insurance—principally Medicare, Medicaid and the Veterans Administration—pays 41 percent of the overall bill.
About 20 percent of hospital expenses were out-of-pocket in 1960—exactly the share my parents faced. The public sector’s share rose to 55 percent in 1996, declining slightly to 48 percent by 2016.