The Government Excess expenditure on Health Care

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The Government Excess expenditure on Health Care

The United States spends more on health care than any other country worldwide, with a large chunk coming from the federal government. In 2007, the United States spent about $3.5 trillion, or 18 percentof GDP on health expenditure. The federal government finances 1.5$ trillion of the 3.5$ trillion CITATION Hea18 l 1033 (Health Care, 2018). Sources show that the federal government dedicates nearly 8% of the economy’s resources towards health care. The figure is expected to rise by 2.9% in 2028, which is not sustainable in the long run CITATION Hea18 l 1033 (Health Care, 2018). Hence, the federal government should consider trimming down Medicareexpenses by investing in its citizens’ essential and other required services. The government can also consider coming up with a health insurance fund to hedge the risk of rising health care costs.

The rising health costs threaten trust fund solvency and fiscal sustainability. Medicare program funded through the Hospital Insurance (HI)trust fund is financed primarily with a 2.9 percent payroll tax split between employers and employees CITATION Hea18 l 1033 (Health Care, 2018). Simultaneously, the continued rise in healthcare costs will increase federal borrowing, which is crucial in contributing to the unsustainable increase in debt. This debt is transferred to the public, and thus tax rates are increased to provide funds to help in debt financing. The result is a high cost of living, a massive tax obligation, and a reduced purchase power for the citizenry. As the debate continues over the Affordable Care Act’s repeal and what should replace it, most Americans have divided views on who’s responsibility it should be to ensure that all Americans have affordable health care coverage. From an angle, 60% of Americans say the government should be responsible for providing care coverage for all Americans, while 38% say it is the government’s responsibility CITATION Kri17 l 1033 (Bialik, 2017). Another debate that has ensued recently is whether private companies or the government should provide health care coverage. Health care could be termed as a basic need, thus making it essential. If left for private companies to handle, chances are the average citizen will not afford the luxury of securing one. Again, when left to the federal government without a proper framework, the public tax liability will surge, raising the tax margins and the cost of living.

References

BIBLIOGRAPHY Bialik, K. (2017, January 13). More Americans say the government should ensure health care coverage. Retrieved from Pew Research Center:https://www.pewresearch.org/fact-tank/2017/01/13/more-americans-say-government-should-ensure-health-care-coverage/

Health Care. (2018, May 16). American Health Care:Health Spending and the FederalBudget.RetrievedfromCommitteeforaResponsibleFederal Budget:https://www.crfb.org/papers/american-health-care-health-spending-and-federal-budget