Medicare is big. And as America gets grayer, the health insurance program for seniors and the disabled is going to get a lot bigger — and more expensive.
About 51 million Americans were covered by Medicare in 2012. at a cost of around $574 billion, or about 3.6 percent of the nation's gross domestic product. By 2023, about 70 million people will get health care paid for by Medicare, and their tab is expected to hit $1.1 trillion .
So what's behind Medicare's rising costs? There are lots of factors, but the biggies are obvious. "The growth in health spending, which affects all payers, is influenced by increasing volume and use of services, new technologies, and increasing prices," the Kaiser Family Foundation writes
in a primer about Medicare's finances.
Americans have some ideas, too. But many of the cost factors that people think are the most important pale in comparison to those that actually are, finds an analysis of six different polls that was published in a recent issue of the New England Journal of Medicine.
Mismanagement and fraud top the list. Too little spending on preventive care is also in the mix.
"People are more worried about not getting care they need than overuse of care," says Robert Blendon. who co-directs the Robert Wood Johnson Foundation/Harvard School of Public Health project on understanding Americans' Health Agenda. "People don't understand the basics about why it's more expensive."
Why People Say Medicare Costs Are Rising