Medicare versus insurers

http://krugman.blogs.nytimes.com/2009/07/29/medicare-versus-insurers/

July 29, 2009, 2:13 pm
I notice from comments that a fair number of readers think that Medicare has had runaway costs. What you need to ask is, runaway compared to what?

Here’s the raw fact, from the National Health Expenditure data: since 1970 Medicare costs per beneficiary have risen at an annual rate of 8.8% — but insurance premiums have risen at an annual rate of 9.9%. The rise in Medicare costs is just part of the overall rise in health care spending. And in fact Medicare spending has lagged private spending: if insurance premiums had risen “only” as much as Medicare spending, they’d be 1/3 lower than they are.

We don’t have a Medicare problem — we have a health care problem.