PrintJanuary 7, 2011
Report on health care spending shows government with 44% share
The Centers for Medicare & Medicaid Services released its annual National Health Expenditure Accounts report Wednesday. The report contains "the official estimates of total health care spending in the United States." In 2009, health care spending in the U.S. totaled $2.486 trillion, up 4% versus 2008. That equates to 17.6% of our nation's Gross Domestic Product and $8,086 per person.
Federal, state and local governments disbursed nearly 44%, or $1.083 trillion, of all health care dollars spent while the amount paid directly by businesses and households was 21% and 28%, respectively.
In light of this data, liberals fussing about the various efforts underway to repeal ObamaCare are ignoring a few elephants in the room (and I don't mean Republicans).
For one, the market that Democrats argue is the most broken is the one in which government meddles most. By its own account, the government already accounts for nearly half of the nation's health care spending, even before ObamaCare takes effect. With that much government intervention, is it any wonder why the healthcare system seems in need of repair? All of that meddling has crowded out market forces and mucked-up this sector like no other in our economy. But what are the Democrats prescribing? An even bigger dose of what's ailing us.
Second, word is that Democrats are preparing to parade out a long line of victims, ones who will claim to be personally devastated if ObamaCare is repealed. Some stories will be compelling, no doubt, and all will be anecdotal, but leaving that aside, won't each of them, ipso facto, represent evidence that existing government-run healthcare schemes and programs -- ones touted with great fanfare upon implementation -- have failed? That is, what does it say about the massive government healthcare programs that already exist, like Medicare, Medicaid, CHIP, the VA, and others?
Third, some say 17% or thereabouts of GDP is too much to spend on health care. Other countries' lower percentages are cited to support this contention. I don't know what the "right" percentage is but proffer that as long as spending on health care is between a consenting consumer and provider, what does it matter how much is spent (as long as I'm not coerced to pay someone else's tab, and currently and admittedly, I am). Also, isn't health care a "good" thing usually and that a sizable amount spent on it is an indicator of a society's quality of life?
Michael F. Cannon at Cato Institute noted a few interesting aspects about the recently issued report. The government reclassified some "service and payer categories" since last year's report was issued. As a result, the report issued yesterday shows the percent of government-paid health expenditures in 2008 as 41.2% rather than 47.3% shown in the 2008 report. Cannon wonders whether that key figure got too close to -- or over -- 50% in 2009, provoking a retroactive change in presentation. Cannon also noted that while total health care spending grew by 4 percent overall in 2009, "government health spending grew by 9.9 percent and private spending shrank by 0.2 percent." Cannon quips, "And the feds are the guys who say they're going to control health care costs!"
