On the major developments that contributed to the modern model of health insurance - Research Paper Example

Health Insurance Insurance provided by an employer to the employees or the insurance provided by an association to the people in its membership is referred to as group coverage whereas the insurance bought by an individual on his/her own without the involvement of an association or employer is referred to as individual coverage (BCBSM, 2014). The fundamental difference between group coverage and individual coverage of health insurance is the person or entity who administers the insurance. Understandably, individual coverage provides an individual with more responsibility as well as freedom to manage his/her health plan compared to group coverage.

Major developments in health insurance include but are not limited to the Hill-Burton Act of 1946 and the HMO Act of 1973. The Hill-Burton Act of 1946 is directed at offering loans and federal grants in order to improve the physical plant of the hospital system in the nation. Another name for the Hill-Burton Act is the Hospital Survey and Construction Act. Since their start, the Democrats and the Republicans designed the HMOs with a view to eliminating the individual health insurance. The HMO Act was proposed by President Nixon and was passed by the Congress in 1973.

The HMO Act of 1973 established new and more cost effective health coverage which had constituted only a little portion of the market until then. The only main HMO till 1969 was Kaiser Permanente most of whose members would join only through unions (Holleran, 1999). The HMO Act together with Medicare ultimately eradicated the affordable individual health insurance market. References:Blue Cross Blue Shield of Michigan. (2014). Whats the difference between group and individual coverage? Retrieved from http://www.bcbsm.com/index/health-insurance-help/faqs/topics/buying-insurance/difference-between-group-and-individual-coverage.html. Holleran, S. (1999). The History of HMOs.

Retrieved from http://capitalismmagazine.com/1999/11/the-history-of-hmos/.