The Hill-Burton Act of 1946: America’s First Health Policy

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Julie A. Bargo
March 14, 2020

Health policy practitioners encounter two major issues when crafting policy solutions to healthcare problems: access and cost-containment. Like the relationship between supply and demand in Economics, the relationship between access and cost is the foundation on which health policy is built. This is especially true when trying to balance government healthcare programs like Medicare and Medicaid alongside private insurance plans driven by market principles. In trying to develop policy solutions that are viable from both the access and cost-containment perspectives, the best place to begin is to evaluate the policy interventions that have previously been implemented in order to learn what does work, what might work and what absolutely does not work. While this medium is not appropriate for a comprehensive review of the United States health policy compendium, we can look at one policy that is regarded as the beginning of the United States government’s foray into health policy intervention: The Hill-Burton Act of 1946.

It is safe to assume that the Hill-Burton Act is a lesser-known policy among the general public, yet it cannot be overlooked in its contribution to the historical record of policy interventions. Passed in 1946, Hill-Burton gave hospitals, nursing homes, and other health facilities grants for new hospital construction and modernization, and in return these healthcare entities agreed to provide health services to the individuals in the community regardless of their ability to pay. In a 1962 article published in The Review of Economics and Statistics, authors Paul Brinker and Burley Walker state that the Hill-Burton Act provided for a government expenditure of $75 million annually which was raised to $150 million annually in 1949. According to Brinker and Walker these grant funds were allocated to the states for either assessment surveys to determine hospital need or to fund healthcare facility construction. Brinker and Walker also state that the Hill-Burton Act led to the Surgeon-General’s establishment of hospital bed to patient ratios determining that 4.5 hospital beds were needed per 1,000 in population.

Ultimately, the Hill-Burton Act did improve hospital bed to patient ratios, especially in rural communities, but it only addressed one side of the health policy coin: access was improved, but cost was not addressed. According to HRSA website, Hill-Burton programs stopped providing funds in 1997, but approximately 140 healthcare facilities are still obligated to provide free or reduced-cost care under the program. Herein lies the first lesson learned; healthcare programs that are reliant upon federal funding are not sustainable. As happens with a lot of government programs, today’s program that is fully funded by an appropriations bill turns into tomorrow’s unfunded mandate which leaves hospitals, healthcare providers and essentially the individual to figure out how to cover the cost.

This is evident with contemporary policy interventions like the Affordable Care Act (ACA) of 2010. While the federal government was funding Medicaid expansion in most of the States, the programs remained viable. However, once the federal government stopped funding ACA Medicaid expansion, States were left without a way to fund the cost of the extra Medicaid recipients without substantial tax increases. Even states like Kentucky, which was lauded by the Obama Administration as exemplary in terms of the structure of its healthcare exchanges, ended up closing the healthcare exchanges after the federal funds stopped flowing because they could not be sustained on state tax revenues alone and the constituency was not in favor of increasing taxes to support the Medicaid expansion under the ACA. Thus, the movement of the health policy pendulum continues to swing, as it always has, between a regulatory approach (government) and a competitive approach (free market) without measurable success in either direction.

In the United States, our health policy focus has not evolved beyond these two, “Solutions,” and that has got to change if we are to create and implement a viable health policy that produces desired outcomes. The previous 70 years of policy interventions, with their minimal successes and obvious failures, do provide insight into where real solutions for addressing access to healthcare and cost-containment could be derived if we are serious about solving the problem rather than securing political power for political parties.

What we should have learned is that one-sided solutions that are either 100% government-funded or 100% laissez-faire have never worked and will never work. It is going to take an amalgamation of the two along with the actions of the individual to take charge of their own health by accessing preventative care via access to quality primary care in addition to adopting healthy lifestyles maintained by diet and exercise. Additionally, expanded research into the causes and prevention of chronic diseases like heart disease, diabetes and chronic obstructive pulmonary disease (COPD) should be pursued as complications from these illnesses. These complications contribute exponentially to the annual cost of healthcare, yet in a majority of cases these diseases are 100% preventable based on lifestyle modifications. Within the tripartite structure of a government, free market and individual-focused health policy lays the beginnings of improvement of not only the current healthcare system, but also the overall health of the American citizen. The Hill-Burton Act was the first health policy to help point us in that direction.

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Author: Julie A. Bargo holds two Bachelor of Arts degrees in Political Science and History from the University of Kentucky and a Master’s degree in Public Administration from Eastern Kentucky University. Julie is a member of the American Society of Public Administration where she is a member of the Students and New Administrative Professionals (SNAPs) Executive Leadership Team. She is also a member of the American Political Science Association, the Pi Sigma Alpha National Political Science Honor Society, the Pi Alpha Alpha National Public Administration Honor Society, and the Omega Nu Lambda National Student Honor Society.

Julie has worked in a public healthcare setting for over 14 years and currently focuses on how the field of Advanced Practice can contribute to sustainable solutions that address health care issues in the United States. E-mail: [email protected] Twitter: @Julie0285

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