Think there’s a Social Security crisis? Medicare’s impending shortfall is 7 times Social Security’s — $3.7 trillion short of what it needs to pay benefits over the next 75 years. But there’s little talk in Washington about fixing Medicare while politicians and lobbyists are falling all over themselves tackling Social Security.
Medicare costs $325 billion a year. It provides health care for 42 million Americans. It’s expected to be more expensive than Social Security by 2024. And Medicare is on track to start running up red ink in 2018 when it starts taking in less money than it’s paying out. That’s two years before Social Security runs into the same wall.
Washington’s Deafening Silence
But we’re not hearing much about Medicare reform in Washington. For one thing, the Bush administration added $724 billion to Medicare’s cost over the next decade when they added prescription drug coverage in 2003. Saying it needs to be reigned in right after taking the reigns off wouldn’t look too good in the off year elections.
Paying the Pipers
Social Security reform is driven by a campaign for private accounts. Not popular with the general public, but very popular with the Wall Street campaign contributors who’ve made big donations to politicians and stand to reap big returns.
But fixing Medicare’s problems are almost impossible without slapping some kind of controls on rising medical costs. And controlling medical costs would mean cutting into the profits of other campaign contributors in the health care sector.
So while Washington may be biting its collective tongue on Medicare, it’s clear that in Washington, money still talks.
[Crossposted at Watching Washington]