The biggest spending problem the US has is entitlement programs–Social Security, Medicare, Medicaid, Food Stamps, etc. Not only do we spend most of our budget on these programs but there is substantial fraud and waste. A Kaiser Family Foundation report gives projections just for Medicare spending over the next ten years. Medicare covers about 63 million people, or 20% of the US population. The number of people covered and percent of the population will go rapidly in the next few years, to 93 million in 2060. In addition to more people age 65 and over, they will be living longer on average. In 2021 Medicare spending was 13% of all federal spending. In 2022, Medicare spending was $744 billion, up from around $200 billion in 2000. According to KFF, this number will more than double, to $1.7 trillion in a mere ten years, 2033. (KFF Report)
Medicare currently has about half of beneficiaries in private health plans, which are more efficient that fee-for-service Medicare. Medicare should require that they all go into these plans, called Medicare Advantage. That would provide some administrative savings and Medicare should keep a tight rein on payments to the plans, which will lower total future Medicare spending. Raising the age limit for Medicare should be explored, just as it was for Social Security. And Social Security disability needs a very serious cleanup, there is immense fraud and waste there. People on Social Security disability also get Medicare, so kicking off people who are fully capable of working will help Medicare as well.
But no matter what we do, Medicare is in serious trouble, with the Part A trust fund likely to run out of money in a few years. And that projected rate of spending growth makes it very hard to get federal spending as a whole under control. Every American should be aware of these numbers and the impending crisis they reflect, but few are.