The nation's chief economist says the cost of health care will claim an increasingly larger share of consumer and government spending, unless something is done to curb it. Speaking at a Health Reform Summit in Washington on Monday, Federal Reserve Chairman Ben Bernanke said improving the nation's health care system is one of the biggest economic challenges facing the United States. VOA's Mil Arcega reports.
New medical technologies and treatments are allowing Americans to live healthier and more productive lives. But improving quality of life is becoming more expensive. Federal Reserve Chief Ben Bernanke told a meeting of health and government officials that without reforms, the cost of health care could spiral out of control.
"Per capita health care spending in the United States has increased at a faster rate than per capita income for a number of decades,” Bernanke said. “Should that trend continue, as many economists predict it will, the share of income devoted to paying for health care will rise relentlessly."
Americans now spend more on health care than for housing or food. Government estimates show that by 2020, health spending will exceed 22 percent of the nation's gross domestic output.
A major challenge is that 47 million Americans don't have health insurance. Bernanke says it is a problem that costs federal and state governments about $35 billion a year.
"To continue limiting the effects of rising medical costs on household budgets, the government may have to absorb an increasing proportion of the nation's total bill for health care, putting even greater pressure on government budgets than official projections suggest," he said.
Democrats are proposing a system of universal health care with the costs shared by all the participants.
Although Bernanke did not offer specific solutions, he said the challenges are daunting. "Because our health care system is so complex, the challenges so diverse, and our knowledge so incomplete, we should not expect a single set of reforms to address all concerns. Rather, an eclectic approach will probably be needed," he said.
Bernanke declined to comment on interest rates or the state of the U.S. economy. But the Fed chief said exploding costs for Medicare (for elderly people) and Social Security programs could damage the country's long-term vitality and hurt economic growth and stability.