Where the Blame Isn’t

by Dave Schuler on January 2, 2011


Source: CBO

There’s an article over at the New York Times that, at least implicitly, blames the impending collapse of Medicare (or the whole healthcare system, take your pick) on the post-war generation from 1946 to 1968, the Baby Boomers:

About 13 percent of the population today is 65 or older; by 2030, when the last of the baby boomers are 65, that rate will have grown to 18 percent. In addition to testing the sustainability of entitlement programs like Social Security, this wholesale redefinition of old age may also include a pervading sense that life has been what might technically be called a “bummer.”

I’m not going to bother fisking the entire article. Bruce McQuain has already done a pretty fair job of that.

I’ve been pretty critical of the Baby Boomers myself but there are some things we simply can’t be blamed for and the unsustainability of Medicare isn’t one of them.

That the Baby Boomers would start turning 65 in 2011 has been common knowledge since 1965. It is no surprise and neither are the pressures that they would place on the U. S. version of the welfare state, such as it is. It is not their numbers, or their age or their alleged self-absorbtion that is responsible for those pressures. You do not blame the avalanche for destroying the village at the bottom of the hill. You can blame whatever started the avalanche or the placement of the village or the lack of retaining walls but you can’t blame the avalanche. The avalanche is only the avalanche. Once started its descent down the hill was inevitable. The rest was negligence, some inadvertent, much willful.

Consider the chart above. As the Baby Boomers turn 65 the real per capita spending on healthcare is more than six times what is was in 1965. If it had remained the same as in 1965 or even grown more slowly no one would be whining about the high cost of healthcare now (and lots more people would have health insurance without recourse to the PPACA).

Much of U. S. healthcare spending is on those 65 or older. That is not a law of nature. We are different from other OECD countries in that respect—we spend much more on those 65 and older and less on those under 65, particularly less on those from 20 to 35.

That cannot be blamed on the Baby Boomers, corporately. You can blame it on technology, on criminally foolish and self-serving elected officials, on greedy insurance companies and healthcare providers, and on any number of other factors but it can’t be blamed on the whole Baby Boomer cohort.

{ 2 comments… read them below or add one }

steve January 2, 2011 at 11:01 am

Costs have been going up faster for those under 65. (paywall)

http://content.healthaffairs.org/content/27/1/w1.full.pdf+html?sid=be24ec48-41a8-4064-935e-73c4c1237bb6

Otherwise, right on. Costs have gone up faster than GDP for a long time. Prior generations benefited immensely, but it is the Boomers who will have to start cleaning up the mess.

Steve

stuhlmann January 3, 2011 at 3:54 am

“Much of U. S. healthcare spending is on those 65 or older. That is not a law of nature. ”

I think you are at least partially wrong here. Older people have more health problems. I’m in my early 50s. I never missed a day of work due to illness before I turned 40. Since then I have missed 3 weeks due to pneumonia, two weeks for E. coli. and about 4 weeks for a couple rounds of eye surgery. I can’t seem to get through the winter any more without requiring at least one round of antibiotics. Based on my experiences, I expect to have even more heath problems when I turn 65. This is the work of nature – the demand side of our heath care spending.

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