Source: Health Affairs
President Barack Obama promised that his costly Affordable Care Act — nicknamed Obamacare — would help combat the spiraling cost of individual healthcare.
Since it’s implementation, critics and health care professionals have called it a disaster.
The data proves them right — this year healthcare will cost tax payers over $10,000 for each man, woman and child in the United States, a record high according to experts.
According to a new report from the government released Wednesday, the nation’s health care tab this year is expected to surpass $10,000 per person for the first time. The new, embarrassing peak means the Obama administration will pass the problem of high health care costs on to its successor.
The report data, released by the Department of Health and Human Services, projects that health care spending will grow at a much faster rate than the national economy over the coming decade. That cost increase will squeeze the ability of federal and state governments — as well as employers and average citizens — to pay.
Cost increases are predicted to average 5.8 percent between 2015 and 2025, faster than in recent years that saw health care spending moving in step with modest economic growth.
National health expenditures will hit $3.35 trillion this year, which works out to $10,345 per American. The annual increase of 4.8 percent for 2016 is lower than the forecast for the rest of the decade.
According to a report by The Associated Press, faster growth in medical prices and an aging population are partly to blame for the trend. Medicare and Medicaid are expected to grow more rapidly than private insurance as baby boomers age. By 2025, government at all levels will account for nearly half of health care spending, 47 percent.
The analysis serves as a reality check for the major political parties as they prepare for their presidential conventions.
Usually in a national election there are sweeping differences between Democrats and Republicans on health care, one of the chief contributors to the government’s budget problems. But this time the discussion has been narrowly focused on the fate of Obama’s law and little else.
Republican Donald Trump vows to repeal Obamacare, while saying he won’t cut Medicare or have people “dying in the street.”
Democrat Hillary Clinton has promised to expand the expensive government health care benefits.
Both candidates have said they will authorize Medicare to directly negotiate prescription drug prices, which the data says will grow somewhat more slowly after recent sharp increases.
Obamacare attempted to control costs by reducing Medicare payments to hospitals and insurers, as well as encouraging doctors to use teamwork to keep patients healthier. But it also increased costs by expanding coverage to millions who previously lacked it. People with health insurance use more medical care than the uninsured.
Despite much effort and some progress reining in costs, health care spending is still growing faster than the economy and squeezing out other priorities, said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a bipartisan group that advocates for reducing government red ink.
“No serious candidate for president can demonstrate fiscal leadership without having a plan to help address these costs,” she said. “No matter whether a candidate has an agenda that focuses on tax cuts or spending increases, there will be little room for either.”
The $10,345-per-person spending figure is an average; it doesn’t mean that every individual spends that much in the health care system. In fact, U.S. health care spending is wildly uneven.
About 5 percent of the population – those most frail or ill – accounts for nearly half the spending in a given year, according to a separate government study. Meanwhile, half the population has little or no health care costs, accounting for 3 percent of spending.
Of the total $3.35 trillion spending projected this year, hospital care accounts for the largest share, about 32 percent. Doctors and other clinicians account for nearly 20 percent. Prescription drugs bought through pharmacies account for about 10 percent.
The report also projected that out-of-pocket cost paid directly by consumers will continue to increase as the number of people covered by high-deductible plans keeps growing.