Three decades of Medicare: what the numbers tell us.

The Medicare program was first implemented to meet a critical need in American society, and over its thirty-year history it has evolved into an integral part of the U.S. health care system. This DataWatch provides a broad overview of the program, outlining both historical and current trends in coverage, financing, payment mechanisms, beneficiary status, benefits, and spending.

National health expenditure projections, 1994-2005.

Using 1993 as a baseline and assuming that current laws and practices continue, the authors project U.S. health expenditures through the year 2005. Annual spending growth has declined since 1990, and, in the scenario reported here, that trend continues in 1994. Growth of health spending increases thereafter, but remains below the average experience of the past decade. Even so, health expenditures grow faster than the gross domestic product (GDP), and by 2005, account for 17.9 percent of the GDP. Unless the system changes, Medicare and Medicaid are projected to pay for an increasing share of total spending during the next decade.

National health expenditures projections through 2030.

If current laws and practices continue, health expenditures in the United States will reach $1.7 trillion by the year 2000, an amount equal to 18.1 percent of the Nation's gross domestic product (GDP). By the year 2030, as America's baby boomers enter their seventies and eighties, health spending will top $16 trillion, or 32 percent of GDP. The projections presented here incorporate the assumptions and conclusions of the Medicare trustees in their 1992 report to Congress on the status of Medicare, and the 1992 President's budget estimates of Medicaid outlays.