Private Health Insurance 1973 vs 2014


In 1973,  75% of all Americans were covered by private health insurance (

In 2014, 41 years later,  private insurance covered 70.4% of all Americans. (

Editor’s Note: In 1973 the average group medical rate for employee coverage was less than $20 per month. Family rates were as high as $45. Rates were guaranteed for two years, there was no underwriting, and employees could join the plan at will. In those days the only types of health plans sold were indemnity plans. Hospital room allowed rate was $15 per day for example. Then in the mid 1970’s along came a new health plan called Major Medical. We could add a $250,000 major medical umbrella over indemnity plans for less than $3 per month. There were no “networks” to access – insureds could go anywhere they wished. Balance billing rarely occurred. Since premiums were so low, most insurance agents refused to sell health insurance policies. But, with the advent of the Golden Age of employee benefits in the early 1980’s, the beginning of skyrocketing health care costs, insurance brokers took note and entered the market in droves. Some health insurance brokers in those days became millionaires through lucrative brokerage contracts that paid as much as 15% level commission for the life of the policies they sold. It was in their interests to sell rate increases. A 25% rate increase meant a 25% increase in commissions. Twisted incentives thus were spawned. It was only the beginning…………

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