Earlier today, Ben Bernanke, chairman of the Federal Reserve, expressed concerns about the staggering amount of money the US government is spending on health care and how current projections for growth in healthcare spending threaten the nation’s economic stability.

Fielding questions from the Senate Finance Committee in Washington, Bernanke mentioned the value of limits on debt and the nation’s deficit in correlation to interest rates, economic growth, and stability.  His concern is that, without change to the current US healthcare system, it may soon become impossible to maintain a strong, stable national economy.

Excluding interest payments on the current national debt, healthcare spending for programs such as Medicare and Medicaid takes the largest single chunk of taxpayer dollars, about 23% of the US gross domestic product (GDP).  Projections place healthcare spending at 35% of GDP in 2025 unless changes are made to the national healthcare system.  In 1975, the federal healthcare bill was just 6% of GDP.

Describing the US healthcare system as complicated, Bernanke says an “eclectic approach” to fixing the problem of American health care is most likely needed.  He does not expect any one set of reforms to be effective enough to cover all concerns with the current system that need to be addressed.  Bernanke cites access to medical care as the “first major challenge” that needs to be addressed when discussing healthcare reforms.

Source: Reuters