What Rising Health Care Costs Mean to the Country

The trouble facing Democrats as they continue to push for health care reform is that, in a country of roughly 300 million people, almost 260 million already have health insurance, and of those who don’t, a vast majority likely won’t face any medical emergencies this year. Contrast that with those without jobs, who feel the pain of their condition each and every day. That distinction goes a long way toward explaining why Obama now says that jobs are his top priority, and why Senate Democrats, at least for the time being, have shelved health care reform in favor of legislation designed to curb unemployment.

It doesn’t mean, though, that health care reform should remain on that shelf for too long. Indeed, officials monitoring the nation’s health care spending provided further evidence that health reform isn’t simply a moral imperative, but an economic one. In 2009, Americans spent roughly $2.5 trillion on health care, according to the Centers for Medicare and Medicaid Services — a figure representing 17.3 percent of the nation’s economy, up from 16.2 percent the year before. And things are projected to get much worse. CMS economists project that health spending will jump to $4.5 trillion in 2019, representing 19 percent of the economy.

Washington Post columnist David Broder points out today that Medicare, Medicaid and Social Security, which currently represent 41 percent of federal spending, are projected to consume 60 percent of the federal budget in just 20 years — “crowding out almost everything else the country needs from government.”

Amid the flurry of numbers, Merrill Goozner discovered another bleak milestone. “Public sector involvement in health care this year will surpass private sector spending for the first time in U.S. history,” he notes today, attributing the growth to the recession-fueled decline in employer-sponsored health coverage. Fast forward a decade from now, and here’s what that means for the country:

In 2019, U.S. government agencies at the state and federal level ALONE will spend 10% of GDP on health. That’s a greater share of economic activity than many other highly industrialized nations that insure everyone, yet the U.S. will still have one in six or seven people without any coverage at all at some point during the year.

If this isn’t an economic case for health care reform, then nothing is.