Health Care System Evolution Paper Essay Sample

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Health care system is one of the most controversial issues in the United States.  Although the country spends a larger part of its revenues on healthcare compared to other developed countries, United States continue to be ranked low in terms of health care. Over the years, there have been different changes in the health care system in the United States.  With the increasing cost of health care, the government came up with tax advantage for employers who purchased insurance coverage for their employees. However, the government later found that the poor and the unemployed were facing challenges in accessing medical services. Therefore Medicaid and Medicare were created in 1965 in order to take care of the poor and the aged. Over the years, the two programs have undergone several changes.  The evolution in health care system has various impacts on the Medicaid program.

In this paper we are going to review how the evolution of health care system has influenced the current health care systems in light of the Medicaid program.

How Medicaid has evolved

Since 1965, Medicaid has led to subsidization of sharing of Medicare cost for the low income beneficiaries.  The two programs, which were enacted as a part of the Social Security Amendments Act 1965,   have undergone a lot of changes to rhyme with the changing need of health care in the country (Diane, 2006).  Today, Medicaid has become the backbone for the backbone of the health care system in the country.

However, Medicaid was different from Medicare in that the program involved the federal government setting aside funds which were then given to different states   in order to administer their own programs (Kaiser Family, 2002).  The federal government also set the basic standards for individual who were to be covered through the program.  The states were also given the freedom to deicide whether they could broaden the coverage of the program or not.

In the beginning, Medicaid categories used to be defined by the status of the recipient of the welfare.  However this changed over the years from the mid 1980s and was ceased with the welfare reforms of 1990s (Diane, 2006).  Over the years, Medicaid has evolved from a simple program that provided health insurance to the population under welfare program to a robust catch all program proving health and long term care to more than 40 million people in the United States, with a budget of more than $170 billion. By the end of the century, Medicaid was the leading source of health care insurance to one of every four American children which was approximately 40% of all the births in the country.

Eligibility to the program has also been changing over the years.  In the beginning the program was for the “deserving poor’, medically need aged individuals, the blind, disabled, families with dependant children, and others under poverty.  Today, the program has evolved to cover more categories of people including pregnant women, children under the age of 6 years, qualified Medicare beneficiaries whose income does not exceed 100% of the set level of poverty, and disabled persons who have income below some set levels (Kaiser Family, 2002).

Administration of Medicaid funds have also changed over the years.  The original model provided the clients with freedom to choose their own providers.  However, this has changed since 1980s and states were calling for Medicaid recipients to enter Managed Care programs and this law was finally passed in 1997. Today Medicaid funds are administered through fee-for-service and through Medicaid Managed Care (Diane, 2006).

The benefits to the Medicaid recipients have also changed over time.  However, the benefits usually vary from state to state. Today there are more than 26 categories of services which are listed under Medicaid services.  The recent changes in 2002 on health care system  requires all the states to provide  Medicaid  recipients  with  inpatient services, outpatient services,  screening, laboratory and  X-ray services,  nursing facilities services, family planning, diagnostic and treatment, physician services, nursing  and midwife services. Medicaid has also evolved to cover long term care although states are given a varying degree of flexibility on the long term care provided. Due to the freedom of the states, some states also covers optional services like podiatry, dental care, dentures, and others (Diane, 2006).  As the population of the uninsured population increase in the country, Medicaid has become the main vehicle that provides coverage to the low income families.


Medicaid was enacted as a part of social security act that were meant to provide health care assistance to the poor, aged, and unemployed. Over the years, Medicaid has however evolved from its initial converge to become the backbone of the health care system in the United States. As United States struggle with problems of healthcare, the number of financial insecurity individuals is increasing each and every day. Medicaid has changed with the changes in the health care system.  Today Medicaid is the largest government funded program providing health care services to the poor people in the country.


Diane, R. (2006). Medicaid: Facing the facts. Retrieved 29th January 2009 from

Kaiser Family, (2002). Medicaid. Kaiser Family, 2002

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