Speaker: R.H. Sprinkle
Abstract: Scholars and commentators lamenting most Americans’ dependence on employers’ sponsorship of group health insurance have conventionally blamed that dependence on federal intervention in healthcare finance during World War II. Within the health-policy community and in political debate, the charge against wartime federal intervention still resonates, warning against further federally initiated reforms. Working from primary sources, we examined this charge, finding none of its motivating beliefs well supported and its leading beliefs demonstrably baseless. We identified pivotal points of confusion and herein report findings apparently new to scholarship. Wartime federal intervention did not favor employers’ sponsorship of group health insurance either intentionally or inadvertently and does not now explain to any degree Americans’ healthcare-finance problems. Recurrent assertions to the contrary are ahistorical, lacking primary-source documentation, neglecting complex contextual factors, and diverting attention from different explanations. Non-wage benefits for employees as groups, but not as individuals, had been fully exempted from taxation since 1920. The actuarial attraction to employees as groups was strong, especially so from 1929 for local nonprofit hospital service plans, whose benefits were attractive yet modest and whose risk pools were small. Interest-group campaigns before and after World War II successfully blocked the maximum-risk-pool alternative, national health insurance. Subsequently during peacetime prosperity, a tacit complementarity of union, industry, and medical interests propelled group health insurance beyond the benefit restrictions of traditional service plans and ever further beyond the reach of Americans less well employed or not employed at all.
Research Seminar Series attendance is open to all interested faculty, staff and students.