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Health Insurance Law

Early Days of National Health Insurance Law

National health insurance bills were introduced by Congress in the 1930’s and 1940’s but were not enacted. However, the Social Security Amendments Act of 1965 instituted the Medicare health scheme primarily for the aged, within which the Medicaid program catered for low income families, children and individuals, and many years later President Clinton introduced a bill of universal coverage in 1993 but failed to gain support for it.

The Medicare legislation was extended in 1973 to persons under the age of 65 with disabling conditions, and in 1988 congress passed legislation to further extend it to include prescription drugs. Due to the expansion being funded by a tax on elderly income, the bill was repealed the following year. In 2003, the Medicare legislation was amended for further reform to provide coverage of prescription medicines that had escalated in cost, to the detriment of the elderly. 

Indeed the wage freezes imposed by law were the catalyst to employers invoking health insurance as an incentive to attract workers during World War II, and the well established practice of employment based insurance was preserved by the Consolidated Omnibus Budget Reconciliation Act (COBRA) which was enacted in 1985 and guaranteed dependents of employees who had retired or become redundant, ex spouses of workers after death or divorce and children of workers their health insurance benefits.

Extending the provisions of the COBRA Act, and in order to address the issue of employers cancelling the health insurance of employees and their dependents when they ceased employment with them, the Health Insurance Portability Act of 1996 was introduced to guarantee portability and coverage of insurance benefits in the transitional period between employment opportunities.

As the states have been given authority by the Federal government to implement their Medicare and Medicaid funding within federal guidelines, some states such as Oregon have passed the Oregon Health Plan legislation to provide this funding to cover more people on a basis of a guaranteed type of care, rather than to provide care to people upon eligibility guidelines alone.

The Mental Health Parity Act of 1996 recognized the increasing incidence of mental illness and required that employers with in excess of 50 employees had to offer health care plans that offered mental health care on the same terms as physical care. Despite this, in many states employers circumvented this law by abolishing health insurance altogether, and the law said nothing in regard to employers passing on the cost of such extended health care to the employees themselves.

Californian Health Insurance Law

The Californian law defines insurance to be a contract where one party undertakes to indemnify the other against loss damage or liability arising from an unknown contingency or event,1and in California insurance fraud is a felony2.Accordingly, in Bates v Health Net Life Insurance Co., Ms Bates a breast cancer patient had her insurance rescinded and received a settlement of $9.3million.

Californian Governor Arnold Schwarzenegger has addressed the health insurance crisis in California to some extent, by protecting the interests of citizens against the might of the insurance companies, but a universal health system seems unlikely in the near future.

He has advocated for health care reform that allows individuals to take responsibility for their own insurance and one that prevents unfair practice by insurers in refusing cover to individuals. As is the case throughout most of America, a universal system of health care appears too costly and something of a mere suggestion at this stage. 

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