WASHINGTON - The introduction of the Medicare prescription drug benefit means that soon the government will be picking up almost half the nation's health care costs, a report released yesterday shows.
And private-sector spending on health care also will increase, according to economists and actuaries for the Centers for Medicare and Medicaid Services.
Writing in the Internet edition of the journal Health Affairs, the economists and actuaries predicted continuing increases in public and private health care spending would lead to "heightened pressure to find ways to slow cost growth without compromising quality of access."
The study measured the projected effect of last year's Medicare overhaul - including the new prescription drug benefit - between 2004 and 2014. The prescription benefit has been estimated to cost $724 billion in its first decade.
In other industrialized democracies, health care programs cover all citizens and are highly subsidized by government. The United States is the only large nation in which private payments exceed government spending on medical care.
According to the new report, that might change in the next decade. By 2014, the authors said, government would account for 49.5 percent of the nation's health spending.
At a news conference yesterday sponsored by the Henry J. Kaiser Family Foundation, Richard Foster, the chief actuary for the Centers for Medicare and Medicaid Services, pointed out that by 2014, only the leading edge of the baby-boom generation will have reached the age of Medicare eligibility.
"In the future, it is almost without doubt that the public share will cross over [50 percent of total spending] and continue to grow for at least 30 years," Foster said.
C. Eugene Steuerle, a senior fellow at the Urban Institute, a nonpartisan economic and social policy organization in Washington, said that if health care spending continues to increase at the rate predicted by the government actuaries, it would very soon place "enormous pressure" on the medical system.
Steuerle and Marilyn Moon, director of the health program at the American Institutes for Research, a behavioral and social science research group in Washington, said they feared the government would respond to the pressure by shifting costs to individuals, who in turn might forgo needed health care.
