Why Medicare Must be Reformed, in One Chart

by Veronique de Rugy

Based on the data from the Trustees’s Report and the CBO, the cost per capita of Medicare is expected to roughly double between now and 2040 and so is the number of enrollees.  Here is the chart:

Between 1975 and 2011, the number of Medicare enrollees doubled to 48 million, and the real cost per enrollee quintupled. By 2040, the Trustees calculate, the program will consume almost 6 percent of GDP (see pg.213), the cost will be nearly $21,000 for one beneficiary, and Medicare will cover about 88 million people.

This explains why free-market advocates have been demanding for years that Medicare be reformed and why it has been such a significant issue recently. There are different ways to reform the program, of course. You can see Yuval Levin’s detailed description of the Ryan plan last week; there are other options too. This chart is also the reason why I wrote last week that I hoped that when Republicans talk about “protecting Medicare,” they mean “reforming Medicare.”

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