Why Government Healthcare Spending is Growing So Fast

The reason government spending on healthcare is outstripping other forms of health expenditures is that there is faster growth in the number of people requiring government assistance.

Over the past 25 years, the number of Americans relying on government help for healthcare has doubled. Meanwhile the number of people using private insurance has stagnated.

This is happening for two reasons: 1) The population is aging so a greater proportion of people qualify for Medicare and 2) Medicaid rolls have increased sharply with the introduction of Obamacare and a change in rules during COVID that made it so that people on Medicaid could not be dropped from Medicaid.

Simply, the number of people who are uninsurable - costing more than $10,000 a year in expenditures - is growing several times faster than the number of people with a cost profile that can be paid for out of a person’s income.