The Cost Realities and Political Events’ Impact on National Healthcare Action
In the 1970s, bipartisanship began to break down as disagreement about the role of government in healthcare increased. With both Medicare and Medicaid costs rising well beyond what were projected, some Democrats began to push for a national healthcare system, while Republicans argued for market-based cost containment. In 1972, more income tax dollars were spent on health and education than on defense, prompting President Nixon to take steps aimed at curbing healthcare expenditures. This included freezing appropriations for already-authorized healthcare programs under a continuing resolution. The Nixon administration referred to its approach to healthcare policy and the period of diminished funding as “new federalism,” a philosophy of reducing federal support while moving administration and funding of healthcare programs to state and local governments. Congress passed the National Health Planning and Resources Development Act (NHPRDA) requiring any community or hospital that wished to build or expand a facility to first present evidence of need to the state health system agency. Congress also passed the Health Maintenance Organization Act (HMOA) encouraging local areas to develop an alternative to fee-for-service medical care by bringing together a comprehensive range of medical or healthcare services in a single organization.
KeywordsPresident Nixon Continuing resolution New federalism National Health Planning and Resources Development Act Health Maintenance Organization Act Budget and Impoundment Act
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