ANNCR: Medicare — on today’s Congressional Moment

By the early 1950s, it was becoming apparent that a growing number of elderly Americans had no economic protection from the increasing cost of health care. Most people over 65 had very low incomes and few owned private health insurance of any kind.

Congress began a years–long debate on this issue of national health insurance for the elderly.

Critics in Congress feared Medicare would lead to substandard and overpriced care, and felt that it should serve only the indigent. They also predicted that, with growing numbers participating, it would eventually bankrupt the federal Treasury.

The legislative compromise that became the final Medicare Act – officially known as the "Social Security Amendments of 1965” – was part of President Lyndon Johnson's "Great Society" program. Today it protects more than 40 million Americans from the high cost of hospital care.

Much of the program's costs are covered by payroll taxes paid by workers. Yet costs quickly started to exceed expectations, and as Americans' life expectancy increased over the years, the Medicare program became even more expensive.

It has become a matter of national debate and a financial issue for every Congress and President since. Today it is still one of the fastest growing items in the federal budget. Nonetheless, Medicare remains a popular program, and a well–established part of the federal government's role in our society.

STANDARD CLOSE: This is Lee Hamilton. Congressional decisions impact all our lives. To find out more about how Congress works or to get involved in your government, visit the Center on Congress website at