Challenges of Employer-based Healthcare

A Brief History of the U.S. employer-based Healthcare system

by Alice Faryna M.D.

The USA is unique in the industrialized world in avoiding a move to an equitable form of universal coverage, stemming back to the post depression era of the 1930’s. Blue Cross was created to help Baylor University’s troubled HC facilities, by offering prepaid hospital insurance to teachers. The concept was adopted by other states. Then the concept was expanded to outpatient services and individual contracts. WWII expanded this movement into defense industries and post world war, to factories and other large enterprises. Other players jumped in seeing an opportunity for great profits. BC/BS ultimately abandoned its non-profit charitable stance to join the competitive race.

The irony is that competition is going down as the mega-companies merge and gain massive pricing power. Meantime, the stagnation of wages for the middle income workers or those self employed makes it almost impossible for there to be affordable  comprehensive private insurance. As we know, there has been great resistance in Congress to address the problem adequately. They raise the specter of increased taxes as if high premiums/co-pays were a better option. My personal conviction is that employers would be better off just paying a predictable amount into the health insurance system and  restricting negotiations with employees  to wages and working conditions.

Dr. Faryna is certified in Internal Medicine and Rheumatology. She has 40 years of experience including private practice, Neighborhood health centers, the VA. Associate professor of Medicine at the Wright State University School of Medicine (now the Boonshoft School of Medicine) for 14 years, and 8 years as Medical Director for Medicare Part B, Ohio and West Virginia. She was on the panel of The Economics of Healthcare & Business, OSBC’s event in July 2016.

Learn more in Healthcare Resources for Ohio Businesses.