By SCOTT BITTLE and JEAN JOHNSON
The Republicans who will take control of the House this January have made it clear there are two things they hate: deficits and President Obama’s healthcare reform. They’ve promised to reduce the first and repeal (or at least hobble) the second. But if you’re worried about deficits, repealing the Obama plan won’t do any good unless you’ve got a better idea. In fact, the numbers say repealing it could make the government’s budget problems worse.
Despite the outrage over spending on the Wall Street bailout, the stimulus or the Iraq war, at least these costs are temporary. But the combination of an aging population and health costs that keep rising faster than inflation means that spending on Medicare, Medicaid and Social Security are going up – – and they’ll keep going up for years on end. With an aging population, there will be more older people eligible for these programs. The health care they need will cost more on top of it.
When people argue about the costs of an aging America, they often lump Social Security and Medicare together like they were the identical twins of public policy. If they are twins, they’re more like the 1980s movie Twins, featuring Arnold Schwarzenegger and Danny DeVito as the world’s most improbable pair of brothers. Maybe you remember the iconic movie poster. It shows the two dressed alike, but with an enormous Schwarzenegger looming over DeVito. In the budget world, Medicare and Social Security are both problems, but Medicare is definitely played by Arnold. Here’s why.
Health care spending has been rising faster than the inflation rate for decades. In 2007, the Consumer Price Index went up 2.8 percent, and health spending went up 6 percent. In 1997 inflation went up 2.3 percent, and health spending went up 5.4 percent. In 1990, when inflation was 5.4 percent, health spending climbed nearly 11 percent.
