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Healthcare Evolution

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We all know that health insurance is a type of insurance where the insurer pays the medical costs of the person that is insured if he or she should become sick due to covered illness or causes, or due to accidents. The insurer may be a private organization or a government agency. Market-based health care systems such as that in the United States rely primarily on private health insurance. (SAAGII Corporation , 2005)

While most Americans unsderstand tht insurance has been around in their lifetime, they don't kow just how long this healthcare building has actually been around. The concept of health insurance was proposed in 1694 by Hugh the Elder Chamberlen from the Peter Chamberlen family in the late 19th century. (SAAGII Corporation , 2005) The term health insurance has a much more broader meaning than it did centuries ago. In the beginning early health insurance was actually more or less disability insurance, in the sense that it covered only the cost of emergency care for catastrophic injuries that could (and often did) lead to a disability. This type of model for insurance continued until the beginning of the 20th century. This insurance was known as accident insurance. The first comprehensive group policy was offered in 1847 by the Franklin Health Assurance Company of Massachusetts for insurance against steamboat and railroad accidents. The first individual disability and illness policies came along in about 1890. A little over twenty years later in 1929, the first modern group health insurance plan was formed. A group of teachers in Dallas, Texas, contracted with Baylor Hospital for room, board, and medical services in exchange for a monthly fee. (Northern California Neurosurgery Medical Group, 2007) In the 1930's and 1940's several large insurance companies entered into the health insurance arena including Insurance giant Blue cross and Blue Shield.

One of the biggest questions that most consumers have is trying to figure out exactly jusdt what is health insusrance. In a nutshell, health insurance is a way of offsetting the cost of medical treatment. The individual pays an annual fee (premium) to a health insurance company, and when treatment is needed the company pays the bills (Crystal Semantics Limited , 2005) There are various forms of insurance policies that an individual may choose. The group policy is the type of health insurance poilicy the would normally be sponssored by an employer. with a policy such as this one the indivisual and the employer would each pay a certain percentage for the policy. The premium is what the policy holder or individual will pay each month. The most common ration is 80:20 with the employer paying 80 and the individual responsible for the other 20 percent. There is also usually a deductible that has to be met out of pocket by the individual before the company will pay the rest. there is also an amount hat must be paid by an individual at the time of service which is known as the co-pay. Some people may have an individual policy that can be purchased directly from the insurance carrier. Usually self employed individuals and small bussiness owners will have these tpes of health insurance policies. Throughout the years as the economy rose and fell health insurance not only became a valuable necessity abut also a great recruitment tool. When employers could not offer large salaries , putting together a benefit package with very good health insurance benefits helped give companies considerable leverage at thge bargaining table. today that practice is still very much alive and well.

Government programs to cover health care costs began to expand during the 1950s and 1960s. Disability benefits were included in social security coverage for the first time in 1954. When the government created Medicare and Medicaid programs in 1965, private sources still



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