The U.S. spends more on health care coverage than any on the country on earth - a lot more. When you break down the actual costs, the United States pays out about $10,000 per each man woman and child.
This amounts to nearly 18 percent of the U.S. gross domestic product. The bulk of the health care budget is consumed by Medicare related costs.
Medicare and Medicaid account for more than 1 of every 3 dollars spent on American health care, and 1 of every 4 dollars in the federal budget. What is astounding is the fact that the cost of Medicare is still growing. Currently, the cost is growing at more than twice the rate of inflation. This growth curve is expected to become even more dramatic as the baby boomers age. Compounding the issue is the fact that, the percentage of Americans that are not of Medicare age is shrinking. The very demographic that pays for the cost of Medicare, is simply too small to continue to foot the bill for Medicare in the foreseeable future. It's no wonder the topic of the Medicare exponentially growing price tag, is a constant within the halls of congress.
Unfortunately, knowing that something needs to be done about the funding structure of Medicare, has not translated into real action being taking by the U.S. government. The ever-increasing cost of Medicare is still the elephant in the room that no one, political party, or president, wants to seriously take on. There have been plenty of proposals, and lots of grandstanding (especially around election periods). However, despite all the talk, hand wringing, grandstanding, and dire warnings, we have yet to see any concrete changes made to the Medicare system.
The solution is simple. We either pay a lot more to keep Medicare solvent, we dramatically cut benefits, or we dramatically cut the price we pay for benefits. Of course, a simple solution is not necessarily an easy one. In the case of Medicare, any potential solution will be both complex and exceptionally difficult.
Powerful players with competing interests.
There is a mind-numbing amount of competing interests to consider. And there are serious political ramifications, no matter which direction the solution takes. There are extraordinary powerful interest groups that have a big financial stake in any change made to the system. These groups have the financial and political heft to stymie any change to the system that they do not approve of. As it is now, no one wants to give an inch.
Coming soon: The U.S. Spends More on Health Care Than Any Other Country (Part 2).
Interesting Article: Medicare Supplement benefit changes for 2019