According to a recent Gallup poll, 55 percent of Americans want Congress to put health care reform aside for a while. Only 39 percent want the Democrats to struggle on.
The majority is right. The problem isn’t that the bills in the House and Senate are too sweeping. The problem is that they are so timid and stale that they can’t address the crippling problems our health care system faces just a few years down the road. The cold, hard reality that Congress has so far ignored is this: if we don’t radically and totally restructure health care over the next thirty years, we go belly up. The stakes in health care reform aren’t about covering the uninsured — though that is a worthy goal. At stake is whether and how this country can continue to provide good quality health care to anybody who isn’t rich.
Look at the chart below.
In 2007 roughly 15 percent of America’s GDP went to pay for our health care. By 2035 this cost of health care will be 31 percent of our total GDP. By 2082 health care will cost half our GDP. In other words, by the time today’s twenty-somethings are in their forties, Americans will be paying one third of their income for health care. Maybe they will pay it in taxes for a single-payer, government funded system. Maybe they will pay it in insurance premiums for a private system. Maybe they will pay it in fees and co-payments. But one way or another, one of every three dollars they make will go to pay health care bills. By the time today’s preschoolers hit their retirement, everyone in the country will be forking over half their income to pay for health care.
Medicare is going to be a particularly nightmarish problem. Medicare now constitutes roughly 20% of federal government spending. Project that thirty years into the future as the proportion and number of older Americans grows and as the costs of treatment for each older American rise, and the spending on Medicare is slated to grow from 4.1 percent of GDP in 2007 to 9 percent in 2032 (page 1), and almost 20 percent of GDP in 2082 (page 2). The federal government’s tax revenue has only rarely gone as high as 20 percent of GDP; barring enormous tax increases by 2032 roughly half the government’s tax revenue would go to Medicare alone and by 2082 Medicare would consume virtually every penny the government takes in — without very large tax increases or massive sustained deficits.This is just the cost of Medicare–health care for those older than 65.
Back when I was a hopeful young sprout in Pundit School, they taught us to be careful about making predictions. But I’m willing to go out on a limb here: this won’t happen. Come 2032, Medicare will not be eating up 9 percent of GDP, and health care overall will not be costing 30 percent of the country’s total income. The American people will not be paying over one of every three dollars they make to buy health care.
Something will happen. Either we will ration health care much more aggressively than we do now, or we will find much more efficient ways to provide health care. I vote for the latter, and I think most Americans agree.
This means that change, not stability has to be the number one goal of serious health care reform. This isn’t about propping up the current system for a few more years, or even about getting more people under the tent. It’s not even about ‘bending the cost curve’; it’s about whether the system will break down before today’s college students hit middle age. (more…)