During World War II:

• The federal government froze wages.

• Employers started offering health insurance as a benefit to attract workers.

• The IRS made employer health benefits tax-free.

When Medicare and Medicaid were created:

• Millions of uninsured elderly and low-income Americans gained health insurance coverage.

• All hospitals were paid on a cost basis (as defined and limited by the government).

The elimination of uninsured healthcare allowed hospitals to expand and improve services.

• The Health Maintenance Organization Act expanded access to healthcare which encouraged a shift from fee-for-service medicine to prepaid, managed care models.

• Not-For-Profit Insurance companies were allowed to become For-Profit Health Insurance companies.

• Hospitals merged into large regional systems.

• Insurers consolidated into a few dominant companies.

• With fewer competitors, providers gained pricing power.

• Medicare/Medicaid shifted from cost-based to fixed-fee reimbursement for large hospitals.

• Due to EMTLA, hospital emergency rooms are required to provide care to anyone regardless of their ability to pay.

Private insurers often pay hospitals and clinics 150–250% of Medicare rates to compensate for services provided to the uninsured.

• Private equity ownership in healthcare expanded rapidly buying up physician practices, emergency medicine groups, anesthesia, dermatology, nursing homes, and hospitals.

• Private equity companies buy businesses, raise prices to increase their value, and then sell them