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Myth: Federal government out of control

George Curry | 11/11/2013, 9:28 a.m.
The Republican push to reduce the federal deficit solely through spending cuts is based on mythology rather than fact. That ...
George Curry

I am not suggesting there are not some serious financial questions facing the nation. The rising cost of Medicaid is among those concerns. But it’s important to know why costs will rise rather than using it as an excuse to cut social programs.

“To be sure, Medicaid is projected to rise significantly in cost, relative to GDP, for several reasons,” said the report on low-income programs. “To begin with, costs throughout the U.S. health care system – in both the public and private sectors – have been growing faster than GDP for several decades. Medicaid isn’t the cause of this system-wide cost growth; over the past decade, in fact, per-beneficiary costs have risen more slowly in Medicaid than under private insurance, a trend expected to continue over the next ten years.”

It also noted, “A second reason that Medicaid costs will rise faster than GDP is the aging of the population. Older people have much higher average health care costs than younger people. Elderly and disabled beneficiaries account for 24 percent of Medicaid beneficiaries but 64 percent of program costs. As the population ages, the number and share of Medicaid beneficiaries who are elderly will increase, raising program costs.

“Another reason that Medicaid costs will continue to rise significantly is the continued erosion of employer-based health coverage. Over time, the share of low-income people able to get coverage through their (or their families’) employers has fallen, so more of them have turned to Medicaid for coverage.”

Yes, the federal government needs to pay close attention to future spending and revenue. But not because spending is out of control or the safety net is bankrupting the country.

George E. Curry, former editor-in-chief of Emerge magazine, is editor-in-chief of the National Newspaper Publishers Association News Service. He is a keynote speaker, moderator and media coach. Curry can be reached through http://www.georgecurry.com.