In 1946, the United Mine Workers of America Health and Retirement Funds were created in a contract between the UMWA and the federal government. President Truman and his interior secretary, Julius Krug, negotiated the Funds' creation to end a national strike by the UMWA.

Before the Funds, the health care system in the coalfields was poor. An official medical survey of the coal industry, authorized by the 1946 agreement and directed by Rear Admiral Joel T. Boone, revealed that retired and disabled coal miners were living in conditions of inadequate housing and considerable poverty. Moreover, coal miner families experienced rates of tuberculosis and infant mortality considerably higher than national averages. The United Mine Workers took the position that the conditions described in the Boone Report were the natural consequence of working in the mines. The union called for alleviation of the unhealthy conditions and for assurance that future employment in the industry would not result in destitution in old age.

When the war ended in 1945, the UMWA had proposed a royalty of 10 cents per ton of coal to be paid to the union to provide medical services in the coalfields. The coal operators rejected the idea. But when negotiations began toward a new national contract in 1946, creation of a health and welfare fund for the miners was the union's top priority. Operators again rejected the idea, and the miners walked off the job on April 1, 1946.

Faced with the prospect of a long strike that could hamper post-war economic recovery, Truman ordered Krug to seize control of the mines and force the miners back to work. The miners refused; after a week Krug negotiated an agreement and the strike was ended. The deal created a welfare and retirement fund to make payments to miners and their dependents and survivors. Three trustees would manage the system, which would be financed by a levy of five cents on each ton of coal produced. The Krug agreement, worked out with UMWA President John L. Lewis, also created a separate medical fund to be managed by trustees appointed by the union. This fund was to provide cradle-to-grave health care for miners and their families.

The Funds eventually built 10 hospitals in West Virginia, Kentucky, and Virginia, greatly improving health care in the coalfields. By the 1980s, however, medical benefits for retired miners became a sticking point between the UMWA and coal industry management. Some companies operating in West Virginia and neighboring areas, such as A.T. Massey Coal and Pittston Coal, tried to avoid paying for retiree health care benefits. After the UMWA waged a lengthy strike against Pittston in 1989, Labor Secretary Elizabeth Dole appointed a commission to investigate the retiree health care issue.

The Dole Commission's work led Congress in 1992 to approve the Coal Act, authored by Sen. Jay Rockefeller. Under this law, all coal companies were required to pay for the cost of their retirees' health care. So-called orphan retirees, those whose last employer went out of business, would be funded out of coal industry taxes that otherwise support the Abandoned Mine Land Reclamation Fund.

Throughout the 1990s and into 2002, coal companies continued court challenges to the Coal Act. Congressman Nick Rahall of southern West Virginia sought legislation that would make the transfer of money from the Abandoned Mine Land fund to the miners health plan easier. The Funds continue to finance health care for more than 50,000 retirees and dependents.