The 48th anniversary of Medicaid and Medicare

By Jennifer Rosinski

UMass Medical School Communications

July 31, 2013

dougherty-terryForty-eight years after its passage to provide security for older Americans, the disabled and the poor, Medicare and Medicaid are poised for yet another major milestone in their storied and complicated histories.

The stroke of midnight on January 1, 2014 will signal a new era for the programs, when provisions of the Affordable Care Act (ACA) go into effect. Medicare, the federal program that covers hospital and medical costs for the elderly and some disabled Americans, will cover more preventative services, provide discounts for brand-name drugs and offer doctors support to better manage patient care. Medicaid, the joint federal-state health insurance program for low-income individuals and families, will undergo the largest expansion since its founding as the program becomes a major vehicle for insuring millions of Americans newly eligible for coverage under the ACA.

Signed into law on July 30, 1965, by President Lyndon B. Johnson, the Medicare bill enacted a health care security program for millions of Americans. In his remarks at the signing, Johnson said the new law would mean fewer Americans will be denied the “healing miracle of modern medicine.”

“If you didn’t have these programs it’s kind of hard to imagine what life in the last 40 years would be,” said Terry Dougherty (right), executive director of Health Systems Transformation within the Commonwealth Medicine division of UMass Medical School. “Most people just rolled the dice in terms of their health and thought, there but for the grace of God go I.”

An estimated 100 million Americans, or one-third the country’s population, currently receive benefits from both programs. That number is expected to jump next year, when Americans with incomes up to 133 percent of the federal poverty level will be eligible for Medicaid. “The ACA basically set a new national standard for Medicaid that will allow coverage for millions of childless adults who previously did not qualify for insurance under the program,” said Dougherty, who previously served as director of the Massachusetts’ Medicaid program MassHealth.

The change has been met with resistance in some states that previously set their own income standards. At least 21 states have opted out of expanding their Medicaid program next year, but Dougherty predicts many of those states will eventually change course when they realize that accepting the ACA changes—and the financial incentives the law offers—will serve their citizens in the long run.

For years, Commonwealth Medicine has been at the forefront of helping Massachusetts and other states design and manage health reform and Medicaid programs. Currently, the Center for Health Policy and Research’s Office of Health Policy and Technology is playing a lead role in assisting the development of the state’s next generation health insurance exchange and Medicaid eligibility system. The Commonwealth Connector Authority and MassHealth will begin launching the new system in October.