foodconsumer.org: Government Healthcare Spending to Set All Time High

Government Healthcare Spending to Set All Time High
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admin on 02/07/2010 15:54:00
 
Federal actuaries for the Centers of Medicare and Medicaid Services (CMS)
predict that government programs next year will set a milestone as they will
account for more than half of all US healthcare spending.  They suspect that the
weak economy will send more people to seek Medicaid coverage and slow the growth
of private insurance.
Over the next ten years, national health spending is expected to grow to $4.5
trillion – up from $2.34 trillion in 2008 - growing the burden even further on
the federal budget which is running annual deficits of more than $1 trillion. 
In 2009, government spending on health care in the US is estimated to have
accounted for 8.4% of the Gross Domestic Product (GDP).
By the year 2020, it is estimated that about one in five dollars spent in the US
will go to health care, a proportion far beyond any other industrialized nation.
Medicaid programs are seeing the greatest increase, as more people are losing
private health insurance due to the high unemployment rate.  Many states are
already having trouble funding their Medicaid programs.  President Barack
Obama’s budget proposal for the new fiscal year beginning in October calls for
$25 billion in federal help for covering Medicaid costs.
In addition, the “baby boomer” generation will begin to reach the age of 65
in the year 2011, increasing the number of participants in the Medicare program.
 As the nation ages, the rising number of elderly will add to Medicare spending
as well.
Former Medicare official in the George H.W. Bush administration says that the US
will have to decide soon between raising revenue to pay for Medicare or reducing
benefits.  “It’s going to be a desperate issue five to 10 years out,” she
said.
In addition to Medicare and Medicaid, programs that support veterans, children
and others make up the remainder of federal health care spending.
The public option that would allow people to buy health insurance from the
government has stalled in Congress.
By Denise Reynolds