THE INSURANCE COMPANY
Part of the evolution of the structure of medical care in the United States has been dependent on the development of means of paying for that care. The U.S. system is somewhat unique, in that health care is financed in a complex manner. Some is financed privately or by the patients themselves; some publicly, through federal, state, or local governments; and some indirectly, through a variety of insurance plans available either privately, through employers, or through workers' compensation.
This chapter will explore the development of coverage for medical care in the United States, the concept of insurance itself, and the incentives built into various insurance mechanisms. In addition, claims processing in workers' compensation will be discussed.
Insurance coverage for accidents first became available in the United States in the mid-nineteenth century. The first group health insurance plan became available to the employees of Montgomery Ward in 1910 (Jonas, 1981).