Social Security Amendments Of 1965
President Lyndon Johnson signed Titles XVIII and XIX of the Social Security Act into law on July 30, 1965.
Title XVIII established Medicare, which provided public health coverage to seniors over the age of 65. The Medicare law consisted of Part A and Part B.
- Part A, which was universal for anyone receiving Social Security benefits, covered hospitalization. The recipient paid a deductible about equal to the first day of hospitalization, and Medicare then paid for the next 60 days. After 60 days, Medicare then paid part of the costs for up to 150 days of the hospitalization after 150 days, Medicare did not pay any costs. Medicare also paid the costs of 20 days in a skilled nursing facility after a hospital stay, and then part of the costs for up to 100 days. Medicare did not cover long-term care in a nursing home. Part A was funded by payroll taxes on current workers and their employers.
- Part B covered physicians’ and outpatient servicesâsuch as doctor visits, X-rays, and laboratory testsâafter the beneficiary met a small yearly deductible. About 25% of the funds for Part B came from premiums paid by beneficiaries, initially with all beneficiaries paying the same premium. The rest of Part B was funded out of the federal government’s general revenues. Enrollment in Part B was voluntary, but most seniors elected coverage.
When the Medicare program began in 1966, 19 million people enrolled. By 2015, 55 million people were enrolled in Part A and 51 million people in Part B.
Activity One Group A: Debating The Social Security Act
Review the Great Depression time line and the section entitled The Stock Market Crash and The Great Depression on The Historical Background and Development of Social Security page, and answer the questions below.
- How may the Great Depression have affected the lives of working class Americans?
- How may the Great Depression have affected older workers differently from younger workers?
Read the Preamble to the Social Security Act, and answer the questions below.
- How was the Social Security Act going to provide for Americans in a different way than they had previously been provided for?
- Why do you believe the Social Security Act identified these particular groups in its preamble?
- According to the preamble, what problem is the Social Security Act solving? Under this system, what does the federal government do and what do the states do? Why divide their duties in this way?
Read the following excerpt from President’s Message to Congress, January 17, 1935, New Deal Network and work collaboratively with the rest of your group to answer the questions that follow.
Social Security Act Of 1935
The Social Security Act was signed into law by President Franklin D. Roosevelt on August 14, 1935. It established Social Security benefits throughout the country that serve as a major source of income for elderly and disabled U.S. citizens and their dependents. The law also established the joint federal-state unemployment insurance program. Increases in population and life expectancy have caused Social Security to grow since the early years of the act, bringing about regular adjustments and several amendments since the original passage of the law.
The Social Security Administration estimated that 59 million Americans would receive a total of almost $870 billion in benefits by the end of 2015.
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Early Social Assistance In America
Economic security has always been a major issue in an unstable, unequal world with an aging population. Societies throughout history have tackled the issue in various ways, but the disadvantaged relied mostly on charity from the wealthy or from family and friends.
In the early 17th century, England established poor laws, acknowledging the governments responsibility to care for its less-fortunate citizens.
The Pilgrims brought these laws with them to the New World. Eventually, colonial governments created new laws to care for the poor and destitute, deeming which citizens were worthy or unworthy of different types of assistance. Poorhouses or outdoor relief were common means of public assistance.
Activity Three: Debating The Social Security Act On The Radio
Read a short overview of Social Security and African Americans and the New Deal.
Next, listen to, and read a transcript of Francis Perkins’ statements from a debate on the Social Security Act on December 19, 1935. In order to listen, follow these steps: 1. Go to 2. Right-click on “RealAudio Format” beneath “Remarks By Frances Perkins.” 3. Choose “Save Target As . . .” and save the file to your computer. Be sure to note where you are saving it . 4. Open the file using RealPlayer audio and video player. If you do not already have this program on your computer, you can download it from 5. Within RealPlayer, advance the music file to minute 11:20. 6. Proceed to listen through minute 14:50.After completing these steps, and reading the transcript of the speech below, answer the questions that follow.
- Why did Francis Perkins think that the Social Security Act was a good program?
- How did Francis Perkins describe the role of the states and federal government in administering this program?
- If you were listening to this speech as an audience member how would you have responded?
- How does George Sokolsky criticize the Social Security Act?
- How did George Sokolsky describe the role of the states and federal government in administering this program?
- If you were listening to this speech as an audience member how would you have responded?
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Industrial Revolution In America
According to the Social Security Administration, four changes beginning in the late 19th century helped abolish the economic security policies of the time: the Industrial Revolution, Americas urbanization, the vanishing extended family and a longer life expectancy.
Prior to the Industrial Revolution, many people were farmers and managed to support themselves during hard times, and extended family often lived together on family farms and cared for one another as they aged or struggled.
The Industrial Revolution, however, enticed people to flock to cities for jobs that were often threatened by layoffs and recession, leaving many without a way to support themselves if they lost their job. The urbanization of American also found many people leaving their extended family behind to fend for themselves.
As sanitary and general conditions in America improved, the life expectancy of its citizens did, too. When more and more people grew older, many were unable to work or became sick and required care.
Fact #: Social Security Is Particularly Important For People Of Color
Social Security is a particularly important source of income for groups with low earnings and less opportunity to save and earn pensions, including Black and Latino workers and their families, who face higher poverty rates during their working lives and in old age. The poverty rate among Black and Latino older adults is roughly 2.5 times as high as for white seniors. There is a significant racial retirement wealth gap, leading older adults of color to face more retirement insecurity than their white counterparts. Black and Latino workers are less likely to be offered workplace retirement plans, and they are likelier to work in low-wage jobs with little margin for savings. Social Security helps reduce the economic disparities between older white adults and older adults of color.
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Social Security Retirement Benefits
The cornerstone of the Social Security Act is the Social Security payments it provides current retirees. Social Security benefits are funded through payroll taxes collected by the IRS and entrusted to the federal Social Security Trust Funds. Full benefits are available to retirees at the age of 65, though early retirees, starting at 62, may receive reduced benefits. Social Security benefits are “earned entitlements” a typical worker must have worked ten years before qualifying. In addition to qualifying workers, the spouses and children of workers who have died are typically entitled to the deceased’s benefits.
Us Supreme Court Cases
Two Supreme Court rulings affirmed the constitutionality of the Social Security Act.
- Steward Machine Company v. Davis, 301 U.S, 548 held in a 54 decision that given the exigencies of the Great Depression, ” is too late today for the argument to be heard with tolerance that in a crisis so extreme the use of the moneys of the nation to relieve the unemployed and their dependents is a use for any purpose narrower than the promotion of the general welfare.” The arguments opposed to the Social Security Act articulated by justices Butler, McReynolds, and Sutherland in their opinions were that the Social Security Act went beyond the powers that were granted to the federal government in the US Constitution. They argued that by imposing a tax on employers that could be avoided only by contributing to a state unemployment-compensation fund, the federal government was essentially forcing each state to establish an unemployment-compensation fund that would meet its criteria and that the federal government had no power to enact such a program.
- Helvering v. Davis, 301 U.S. 619 , decided on the same day as Steward, upheld the program: “The proceeds of both taxes are to be paid into the Treasury like internal-revenue taxes generally, and are not earmarked in any way.” That is, the Social Security Tax was constitutional as a mere exercise of Congress’s general taxation powers.
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Fact #: Social Security Lifts Millions Of Older Adults Above The Poverty Line
Without Social Security benefits, about 4 in 10 adults aged 65 and older would have incomes below the poverty line, all else being equal, according to official estimates based on the 2021 Current Population Survey. Social Security benefits lift more than 16 million older adults above the poverty line, these estimates show.
An important study on retirement income from the U.S. Census Bureau that matches Census estimates to administrative data suggests that the official estimates overstate older people’s reliance on Social Security. The study finds that in 2012, 3 in 10 older adults would have been poor without Social Security, and that the program lifted more than 10 million older adults above the poverty line.
No matter how it is measured, its clear that Social Security lifts millions of older adults above the poverty line and dramatically reduces their poverty rate.
Activity Two: Selling The Social Security Act
View each of the following posters, which were produced by the federal government to build support for the Social Security Act among the American public.
- Poster 1: Social Security Poster: More Security for the American Family, Old Man
- Poster 2: Social Security Poster: More Security for the American Family, Mother and Child
- Poster 3: Social Security Poster: More Security for the American Family, Widow
For each image, answer the questions below.
- Why do you think this poster was created for the Social Security Act?
- Who is portrayed in the poster? Which Americans are NOT portrayed in the posters? Why might they be missing from these images?
- In order to “sell” the Social Security Act to the nation, why do you believe the Roosevelt administration chose these images? Identify the ways in which the federal government attempted to “sell” the Social Security Act to the American people. Explain the reasons for your answers.
- How else could the federal government have “sold” the Social Security Act?
This next image was not among those used by the government to promote the Social Security Act. Answer the questions below, which require that you compare this photograph to the three posters you have already worked with in this activity.
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Social Security Law: An Overview
Social security is designed, as the title suggests, to provide security. To protect individuals from unforeseen catastrophes, the government spreads certain risks among all members of society so that no single family bears the full burden of such occurrences.
In the United States, the Social Security Program was created in 1935 to provide old age, survivors, and disability insurance benefits to workers and their families. Unlike welfare, social security benefits are paid to an individual or his or her family at least in part on the basis of that person’s employment record and prior contributions to the system. The program is administered by the Social Security Administration . Since the establishment of the Medicare program in 1965, it and Social Security have been closely linked. While the original act used “Social Security” in a broader sense, including federally funded welfare programs and unemployment compensation within its scope, and the Medicare legislature took the form of amendments to that act, current usage associates the phrase with old age, survivors, and disability insurance.
While the Social Security Act governs an applicant’s right to benefits, state substantive law governs some of the family relationship issues that may bear on that right such as the validity of a marriage.
For greater detail on all these points visit the LII’s Social Security Library.
Types Of Social Security Benefits
Retirement Income
Retirement income makes up the bulk of the payments made by the Social Security Fund, accounting for approximately 71% of about 58 million people who receive social security benefits. For a person to qualify for these benefits, he or she must first meet the retirement age set by the government. The normal retirement age for a worker who was born in 1938 is 65 years.
The retirement age increases by two months for each ensuing year of birth until 1943. For people born from 1943 to 1954, they qualify to receive full benefits at the age of 66 years. For persons born between 1955 and 1959, two months are added for each additional year until those born in 1960 or later receive their benefits at the age of 67 years.
After the retirement age, retired workers receive increased disbursements for every year they delay receiving their benefits up to 70 years. The average retirement income is $1,294 based on the average earnings during the 35 years of work when an individual earned their highest income.
Survivor Benefits
Disability Income
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The Social Security Act Overview
Created by FindLaw’s team of legal writers and editors| Last updated June 20, 2016
The Social Security Act is America’s foremost social welfare law, designed to counteract the dangers of old age, poverty, disability and unemployment through a range of government programs and benefits. The Act was originally passed in 1935, as part of Franklin Delano Roosevelt’s Second New Deal. It has been repeatedly amended, expanded, and adapted since that point, particularly in 1965 under Lyndon Johnson, with the creation of Medicare and Medicaid.
Social Security Amendments Of 1972
President Richard Nixon signed Public Law 92-603 on October 30, 1972, which amended Title XVIII of the Social Security Act. The law expanded Medicare coverage to disabled people who had been receiving Social Security benefits for at least two years, as well as people with serious kidney disease, which the law legally classified as a disability.
Upon signing the legislation, President Nixon stated that it “reaffirms and reinforces America’s traditional efforts to assist those of our citizens who, through no fault of their own, are unable to help themselves. America has always cared for its aged poor, the blind, and the disabledâand this bill will move that concern to higher ground.”
The eligibility expansion in 1972 contributed to Medicare’s increasing costs. In 1967, Medicare’s yearly expenses were $4.2 billion by 1973, they had risen to $9.3 billion. In 2002, the average yearly cost to cover an elderly beneficiary was $6,002, but the average yearly cost to cover a person with serious kidney disease was $41,696.
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Fact #: Social Security Benefits Are Modest
Social Security benefits are much more modest than many people realize the average Social Security retirement benefit in January 2022 was about $1,614 per month, or about $19,370 per year. For someone who worked all of their adult life at average earnings and retires at age 65 in 2022, Social Security benefits replace about 37 percent of past earnings. Social Securitys replacement rate fell as the programs full retirement age gradually rose from 65 in 2000 to 67 in 2022.
Most retirees enroll in Medicares Supplementary Medical Insurance and have Part B premiums deducted from their Social Security checks. As health care costs continue to outpace general inflation, those premiums will take a bigger bite out of their checks.
Social Security benefits are also modest by international standards. The U.S. ranks just outside the bottom third of developed countries in the percentage of an average workers earnings replaced by the public pension system.
Social Security is important for children and their families as well as for older adults. Over 6.5 million children under age 18 lived in families who received income from Social Security in 2019. That number included nearly 2.8 million children who received their benefits as dependents of retired, disabled, or deceased workers, as well as others who lived with parents or relatives who received Social Security benefits.
Social Security lifted 1.1 million children above the poverty line in 2020, as the chart shows.
Activity One Group C: Debating The Social Security Act
Review the Great Depression time line and the section entitled “The Stock Market Crash and The Great Depression” on The Historical Background and Development of Social Security page, and answer the questions below.
Read the Preamble to the Social Security Act, and answer the questions below.
- How was the Social Security Act going to provide for Americans in a different way than they had previously been provided for?
- Why do you believe the Social Security Act identified these particular groups in its preamble?
- According to the preamble, what problem is the Social Security Act solving? Under this system, what does the federal government do and what do the states do? Why divide their duties in this way?
Read the following text, and work collaboratively with the rest of your group to answer the questions that follow.
- What role is assigned to government in the reading?
- Does the speaker believe that the Social Security Act will help or harm the people of the United States?
- What is the speaker’s reasoning for his or her argument? Pay particular attention to whether their position is based on evidence, logic, or economic and political ideology.
- Do you agree or disagree with the author of your document? Why or why not?
- Do you think contemporaries would have found his or her arguments convincing? Why or Why not?
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