The expected increase in the cost of Medicare is the largest single contribution to long-term budget deficits of the country, many estimates show. No cohort of Americans, with the exception of who pays very wealthy to cover enough Medicare taxes and premiums of Medicare cost, if any.
Much of the early public debate of the tax period will focus on the tax and the reduction in the tax rates in the last decades played a crucial role in creating the deficit. But reduce the question of how the growth of Medicare costs becoming increasingly important, because the population aged next and healthcare costs will continue to increase.
In the current tax talks, Republicans pushing for major changes to Medicare, in return for agreeing to the tax increases. Democrats argue that Medicare is not the most pressing budget Problem.Lesen more
What follows is a primer on Medicare costs.
Question: Is Medicare really a larger problem in the long term than social security or the military spending?
A. ja. In the next 25 years, the Congressional Budget Office projects that Medicare spending by 3.7 percent this year to 6.7 percent of the gross domestic product increase. (Other health care federal spending - such as Medicaid, which is insurance program mainly for families with low income - is expected to be 1.7 percent this year 2037, on 3.7 percent of the G.D.P. rise.)
Total health care should rise percentage of G.D.P. five points spending. Social security spending will rise to 6.2 percent in the 2037 expected to be only 1.2 percentage points. All other federal spending is likely to shrink by two percentage points to 9.6 percent.
These estimates assume that some current policies continue, instead, that the various tax increases and spending cuts expected to be January effectively occur and remain there are.
Is question: why Medicare the big problem?
A. receives as much attention as the ageing of population, the rise in the cost of medical care is a major concern of the household. The faster growth of Medicare costs, in terms of social costs, notes this difference.
Social security contributions are actually grow in the next few years the Government add to tax problems. But this cost grow not nearly as fast as Medicare as Medicare costs are a feature for the ageing society and the costs for the treatment of a person. Social expenses arise almost exclusively by the number of older people.
Payment question: most Americans not their Medicare benefits through payroll taxes during their working lives?
A. no, and it's not even close. Two married 66 years ends about income about her life, about $122,000 dedicated Medicare taxes through the payroll tax, including the part that your employer, after Eugene Steuerle, Stephanie Rennane and Caleb B. Quakenbush by Urban Institute pay pay. Expect couple can, about three times as much $387.000, inflation - benefits. The projected gap is even greater for younger people due to growing health costs.
In short, is the largest cause of long-term deficit that get the most much more people of Medicare, as they give him.
Grow question: why health costs are so fast?
A. for a good reason and a bad year.
The reason is that our medical system has made tremendous progress in the last few decades and can treat conditions that once would have killed people. Cancer treatment and cardiac care are two examples of areas with beneficial new treatments, which are often not cheap. An American who is 65 today expect almost 20 years on average by about 16 years 1980 to life.
Bad so that our health system wasted money. The United States spends about twice as much money per person on health care as many other rich countries, without much better results achieved. Americans receive better care in some areas (some types of cancer) and even worse, in other (higher error rates).
It's hard to make the case, the American health system offers a good return on the money that it spends. Life expectancy is higher and has grown among others in Australia, Britain, Canada, France, Germany and Japan, in the last 30 years.
Are question: what the possible solutions?
A. for the beginning, we could pay more taxes. Tax revenues are based on the G.D.P close to a 60-year low get a little to increase as the economy recovers and income, but not nearly enough for the growing cost of health care to pay.
Cover the future costs of Medicare and Medicaid alone through higher taxes would mean sharp increases--much larger than anything else, which will now be discussed. So, most budget experts believe that changes to Medicare must be part of the deficit solution.
Among the options to raise the eligibility age, which now is 65; Reduction of benefits for wealthy families; Introducing more competition; and quality of care rather than pay quantity.
Are question: what the top and cons of each?
A. we can occupy the options at a time:
The most important arguments for lifting the eligibility years old are that Americans are living longer than in the past and health 2010-law makes easier to get it for people, insurance, if they do not receive it from an employer. The main counterargument is that the increase in the life expectancy for people with low incomes, has been smallest, most likely benefit from Medicare coverage.
Reduction of benefits for families with high income has a cross-party support in the face of the recent price increases in income inequality. But some Democrats fear, that it will eventually undermine the Medicare could popularity, so it's like a social program.
Many Republicans are in favour of more competition in the health sector, pointed out that the competition has lowered prices and increased the quality of service in many industries. It has an uneven do in healthcare, partly because insurers often deny care can benefit.
Payment for quality instead of quantity has the support of many economists. But it is not always easy. Patients and doctors want to be often caution with high costs, even though research has shown no effect.
Must question: Medicare is at 01.01 be corrected?
A. obviously not. Many potential changes would gradually, and for years would bring no savings. Other changes like tax increases can have a faster effect on the deficit.
On the other hand, fixing Medicare will be never easy. Each budget negotiations between Congress and the President a chance for them is to move ahead tax problems that grows every year.
-By David Leonhardt
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