TABLE 2.1Key Dates in the Development of Employment-Based Health Benefits and Its Environment

1798U.S. Marine Hospital Service established; deductions from seamen's pay cover costs
1847First (short-lived) company to issue health insurance organized in Boston
1849New York passes first general state insurance law
1853French mutual aid society establishes prepaid hospital care plan in San Francisco
1863Travelers Insurance Company offers accident insurance in the United States
1870sRailroad, mining, and other industries begin to provide company doctors funded by deductions from workers' wages
1877Granite Cutters Union establishes first national sick benefit program
1906American Association for Labor Legislation founded to promote workers compensation and other social insurance programs
1910Flexner report on need for improvements in medical education
1910Montgomery Ward enters into one of the earliest group insurance contracts
1910sPhysician service and industrial health plans established in Northwest and remote areas
1912First model state law developed for regulating health insurance
1913International Ladies Garment Workers Union (ILGWU) begins first union medical services program
1915-1920Efforts to establish compulsory health insurance programs fail in 16 states
1927Committee on the Costs of Medical Care established
1929Stock market crash followed by Depression
1929Baylor group hospitalization plan founded (first Blue Cross plan)
1935Social Security Act passes without health insurance provisions
1937Blue Cross Commission established
1940Predecessor of Group Health Association of America established
1943War Labor Board rules wage freeze does not apply to fringe benefits
1945Kaiser Foundation Health Plan opens to non-Kaiser groups
1947Taft-Hartley Act requires collective bargaining on wages and conditions of employment
1948McCarran-Ferguson Act gives states broad power to regulate insurance
1949Supreme Court upholds National Labor Relations Board ruling that employee benefits are subject to collective bargaining
1954Revenue Act confirms employer-paid health benefits are not taxable as employee income
1965Medicare and Medicaid legislation adopted (effective 1966)
1968Firestone Tire and Rubber Co. begins to self-fund health benefits
1971-1974Economic Stabilization Program (wage-price controls) in effect for health sector
1973HMO Act requires most employers to offer federally qualified HMOs
1974Employee Retirement Income Security Act passed
1974Washington Business Group on Health organized (predecessor)
1978General Motors cost-containment reports initiated
1985Budget Act requires employers with 20 or more employees to offer continued health coverage to terminated employees and dependents for 18 or 36 months
1990Financial Standards Accounting Board requires companies to record unfunded retiree health benefit liabilities on balance sheets (effective late 1992)

SOURCES: Somers and Somers, 1961; Munts, 1967; Anderson, 1968; Wilson and Neuhauser, 1974; Brandes, 1976; U.S. Department of Health, Education, and Welfare, 1976; Starr, 1982; Stevens, 1989; Health Insurance Association of America, 1991b; Employee Benefit Research Institute, 1992c.

From: 2, Origins and Evolution of Employment-Based Health Benefits

Cover of Employment and Health Benefits
Employment and Health Benefits: A Connection at Risk.
Institute of Medicine (US) Committee on Employment-Based Health Benefits; Field MJ, Shapiro HT, editors.
Washington (DC): National Academies Press (US); 1993.
Copyright 1993 by the National Academy of Sciences. All rights reserved.

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