U.S. health costs top $10,000 per person
Healthcare | The future of Obamacare is a central issue this election season
by Ciera Horton
Posted 7/14/16, 03:20 pm
At a new peak, the U.S. healthcare spending tab is projected to surpass $10,000 per person for the first time by the end of the year.
National health costs will spike to $3.35 trillion in 2016, according to a report from the U.S. Department of Health and Human Services, which adds up to $10,345 for every person. Obamacare spending has faced significant Republican criticism and become a central issue in the presidential election.
The report, published Wednesday in the journal Health Affairs, states, “growth in health spending is expected to be influenced by changes in economic growth, faster growth in medical prices, and population aging.”
As the baby-boom generation continues to age, both Medicare and Medicaid are expected to grow more rapidly. Healthcare spending will also increase because there is greater economic stability and people are more likely to spend money. Analysts project an individual’s medical care will cost $16,000 annually by 2025.
In June, congressional Republicans, led by House Speaker Paul Ryan, R-Wis., announced a new plan to repeal President Barack Obama’s signature healthcare law, the Affordable Care Act (ACA). The GOP’s plan would limit Medicaid and encourage a national market for health insurance while keeping some popular aspects of the ACA. But it still has the potential to be expensive. An outline is available, but the plan lacks financial specifics and dollar amounts.
“This isn’t a return to the pre-Obamacare status quo,” the plan states. “And it isn’t just an attempt to replace Obamacare and leave it at that. This is a new approach. It’s a step-by-step plan to give every American access to quality, affordable healthcare.”
Growth in healthcare spending slowed during the recession of the late 2000s, but picked up again in 2014. While expanding coverage was a significant part of the ACA, the law attempted to rein in spending by reducing Medicare payments to hospitals and insurance companies. But it also increased spending by providing coverage to millions who were uninsured.
Now the prognosis shows healthcare spending in the U.S. could represent 20.1 percent of the total economy by 2025.
Republicans have voiced concerns not only with the spending itself, but also with the administration’s authority to allocate some ACA funding. In May, a federal district court judge ruled in a case brought forth by House Republicans that the Obama administration had unconstitutionally directed money to insurance companies for subsidies without the approval of Congress. Ryan called the decision a “historic win for the Constitution and the American people.”
The Obama administration appears to acknowledge the problems with healthcare spending. On Monday, the Journal of the American Medical Association published an article by the president saying, “too many Americans still strain to pay for their physician visits and prescriptions, cover their deductibles, or pay their monthly insurance bills.”
Though the administration admits the existence of financial problems with Obamacare, the issue seems destined to fall to Obama’s successor. Presumptive Republican nominee Donald Trump has vowed to repeal Obamacare without cutting Medicare. Hillary Clinton says she would increase government healthcare provisions.
“No serious candidate for president can demonstrate fiscal leadership without having a plan to help address these costs,” said Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget. “No matter whether a candidate has an agenda that focuses on tax cuts or spending increases, there will be little room for either.”
Ciera Horton is a WORLD intern.