United States

Health and welfare

Despite the country’s enormous wealth, poverty remains a reality for many people in the United States, though programs such as Social Security and Medicare have significantly reduced the poverty rate among senior citizens. In the early 21st century, more than one-tenth of the general population—and about one-sixth of children under 18 years of age—lived in poverty. About half the poor live in homes in which the head of the household is a full- or part-time wage earner. Of the others living in poverty, many are too old to work or are disabled, and a large percentage are mothers of young children. The states provide assistance to the poor in varying amounts, and the United States Department of Agriculture subsidizes the distribution of low-cost food and food stamps to the poor through the state and local governments. Unemployment assistance, provided for by the 1935 Social Security Act, is funded through worker and employer contributions.

Johnson, Lyndon B.: MedicareFormer U.S. president Harry S. Truman (right) looking on as Pres. Lyndon B. Johnson signs the Medicare bill at the Harry S. Truman Library and Museum in Independence, Missouri, July 30, 1965.Lyndon Baines Johnson Library and Museum/NARA

Increasing public concern with poverty and welfare led to new federal legislation beginning in the 1960s, especially the Great Society programs of the presidential administration of Lyndon B. Johnson. Work, training, and rehabilitation programs were established in 1964 for welfare recipients. Between 1964 and 1969 the Office of Economic Opportunity began a number of programs, including the Head Start program for preschool children, the Neighborhood Youth Corps, and the Teacher Corps. Responding to allegations of abuse in the country’s welfare system and charges that it encouraged dependency, the federal government introduced reforms in 1996, including limiting long-term benefits, requiring recipients to find work, and devolving much of the decision making to the states.

Johnson, Lady Bird; Project Head StartLady Bird Johnson, the wife of U.S. Pres. Lyndon B. Johnson, visiting a classroom at the Kemper School in Washington, D.C., for Project Head Start, March 19, 1968. LBJ Library photo by Robert Knudsen

Persons who have been employed are eligible for retirement pensions under the Social Security program, and their surviving spouses and dependent children are generally eligible for survivor benefits. Many employers provide additional retirement benefits, usually funded by worker and employer contributions. In addition, millions of Americans maintain individual retirement accounts, such as the popular 401(k) plan, which is organized by employers and allows workers (sometimes with matching funds from their employer) to contribute part of their earnings on a tax-deferred basis to individual investment accounts.

With total health care spending significantly exceeding $1 trillion annually, the provision of medical and health care is one of the largest industries in the United States. There are, nevertheless, many inadequacies in medical services, particularly in rural and poor areas. At the beginning of the 21st century, some two-thirds of the population was covered by employer-based health insurance plans, and about one-sixth of the population, including members of the armed forces and their families, received medical care paid for or subsidized by the federal government, with that for the poor provided by Medicaid. Approximately one-sixth of the population was not covered by any form of health insurance.

The situation changed markedly with the enactment of the Patient Protection and Affordable Care Act (PPACA), often referred to simply as Obamacare because of its advocacy by Pres. Barack Obama, who signed it into law in March 2010. Considered the most far-reaching health care reform act since the passage of Medicare—but vehemently opposed by most Republicans as an act of government overreach—the PPACA included provisions that required most individuals to secure health insurance or pay fines, made coverage easier and less costly to obtain, cracked down on abusive insurance practices, and attempted to rein in rising costs of health care.

Pres. Barack Obama (centre left) and Vice Pres. Joe Biden (centre right) reacting after the U.S. House of Representatives passed the Patient Protection and Affordable Care Act, March 21, 2010.Pete Souza—Official White House Photo

The federal Department of Health and Human Services, through its National Institutes of Health, supports much of the biomedical research in the United States. Grants are also made to researchers in clinics and medical schools.