Ask Doctor Kildare, Part 2Is our health system primarily private, or primarily public?

Click here for a guide to following the health care reform story online.

PRINTDISCUSSE-MAILRSSRECOMMEND...SINGLE PAGE

FacebookMySpace Mixx Digg Reddit del.icio.us Furl Ma.gnolia SphereStumbleUponCLOSE

Dear Dr. Kildare,

I've read more than once that government (federal, state, and local) accounts for a little less than half of all health care spending in the United States (46 percent) while private spending accounts for a little more than half (54 percent). I was therefore somewhat surprised to see Sen. Tom Coburn, R.-Okla., a leading opponent of health reform, claim that the government now controls fully 60 percent of all health care spending in the U.S.

"Defenders of the Reid bill say we need 'reform' to keep insurance companies honest," Coburn says. "A better question would be: 'Who's going to keep the government honest?' … Government is already the majority-shareholder in our health care system."

How did government's share of health spending jump from 46 percent to 60 percent in the blink of an eye?

Green-Eyeshade Guy

Dear Green-Eyeshade Guy,

Didn't you hear? Bernie Sanders staged a coup d'état at Kaiser Permanente!

Just kidding.

Coburn's source is a Congressional Research Service memo that, at Coburn's request, shifted the cost of various tax subsidies from the "private expenditures" column to the "public expenditures" column. The most significant of these subsidies is the tax exclusion for private health insurance premiums. This, CRS calculates, effectively causes the federal government to pay 15 percent of the bill. When you factor in all tax expenditures, then private spending drops from $1.2 trillion to $895 billion, while public spending rises from $1 trillion to $1.3 trillion. According to this reasoning, government (federal, state, and local) does indeed account for 60 percent of all health care spending.

PRINTE-MAILRECOMMEND...RSS

FacebookMySpace Mixx Digg Reddit del.icio.us Furl Ma.gnolia SphereStumbleUponCLOSE

Timothy Noah is a senior writer at Slate.

SPONSORED CONTENT

• Ask Doctor Kildare, Part 2
  Is our health system primarily private, or primarily public?
  Timothy Noah | Dec. 4, 2009
• Ask Doctor Kildare, Part 1
  Introducing an occasional series answering real questions from fake people about the Senate floor debate on Obamacare.
  Timothy Noah | Dec. 4, 2009
• Forget the Cost Curve
  Curbing medical inflation is no longer a plausible reason to pass health reform.
  Timothy Noah | Dec. 2, 2009
• Search for more Prescriptions articles
• Subscribe to the Prescriptions RSS feed
• View our complete Prescriptions archive