Key Milestones in Medicare and Medicaid History, Selected Years: 1965-2003

1965—Medicare and Medicaid were enacted as Title XVIII and Title XIX of the Social Security Act, extending health coverage to almost all Americans age 65 or over (e.g., those receiving retirement ben­ efits from Social Security or the Railroad Retirement Board), and providing health care services to low-income children deprived of parental support, their care­ taker relatives, the elderly, the blind, and individuals with disabilities. Seniors were the population group most likely to be liv­ ing in poverty; about one-half had health insurance coverage. 1966—Medicare was implemented on July 1, serving more than 19 million indi­ viduals. Medicaid funding was available to States starting January 1, 1966; the program was phased-in by States over a several year period. 1967—An Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) com­ prehensive health services benefit for all Medicaid children under age 21 was estab­ lished. 1972—Medicare eligibility was extend­ ed to 2 million individuals under age 65 with long-term disabilities and to individu­ als with end-stage renal disease (ESRD). Medicare was given the authority to con­ duct demonstration programs. Medicaid eligibility for elderly, blind, and disabled residents of a State could be linked to eligibility for the newly enacted Federal Supplemental Security Income Program (SSI). Eighteen million individu­ als were covered by Medicaid. 1977—TheHealthCareFinancingAdmin­ istration was established by Secretary Califano to administer the Medicare and Medicaid Programs. 1980—Coverage of Medicare home health services was broadened. Medicare supplemental insurance, also called Medi­ gap, was brought under Federal oversight. 1981—Freedom of choice waivers (1915b) and home and community-based care waivers (1915c) were established in Medicaid; States were required to provide additional payments to hospitals treating a disproportionate share of low-income patients (i.e., disproportionate share hospi­ tals [DSH] ). 1982—The Tax Equity and Fiscal Responsibility Act made it easier and more attractive for health maintenance orga­ nizations to contract with the Medicare Program. In addition, the act expanded the agency’s quality oversight efforts through peer review organizations. 1983—An inpatient acute hospital pro­ spective payment system (PPS) for the Medicare Program, based on patients’ diagnoses, was adopted to replace costbased payments. 1985—The Emergency Medical Treat­ ment and Labor Act required hospitals participating in Medicare that operated active emergency rooms to provide appro­ priate medical screenings and stabilizing treatments. 1986—Medicaid coverage for pregnant women and infants (up to 1 year of age) to 100 percent of the Federal poverty level (FPL) was established as a State option.