The Impending Public Plan Spending Disaster

Conn Carroll / April 17, 2009

In his Jimmy Carter-esque “New Foundation” speech Tuesday, President Barack Obama linked health care reform and deficit reduction claiming: “If we want to get serious about fiscal discipline … we will also have to get serious about entitlement reform. Make no mistake: health care reform is entitlement reform.”

Problem is, Obama’s health care reform plan includes a Medicare-for-all like public plan that will “compete” with private plans. The idea that the path to reduced health care spending must go through expanding Medicare is laughable. former Political Science professor at the U.S. Air Force Academy Jeffrey Anderson details why:

Since 1970, our overall national health expenditures (NHE) apart from Medicare and Medicaid have risen 83 percent in relation to the gross domestic product (GDP). Meanwhile, the cost of Medicare has risen 304 percent versus GDP–and that is without even counting the relatively new Medicare prescription drug benefit. The passage of decades hasn’t notably improved the government’s performance: Since 1990, NHE apart from Medicare and Medicaid has risen 19 percent versus GDP, while the cost of Medicare has risen 57 percent versus GDP. (more…)