Medicare is a mess.
No doubt about it -- and if you wonder why Congressman Paul Ryan is suggesting such a dramatic reform of the program -- check out these numbers.
In the next decade, enrollment in Medicare will grow by a third and spending per enrollee will jump 50%.
By 2040 -- the picture darkens as boomers age and retire. By then, Medicare, if it operates as it does now, will cover 88 million people or more than one-in-four Americans.
And, it's cost will be three-times the amount it is today. The sources of Medicare's budget -- payroll taxes and premiums -- can't keep up with the costs of the program.
Once upon a time those sources covered two-thirds of the programs bills by 2040, they will only cover 30%. And, get this -- even with all this spending, Medicare still only covers about 50% of seniors' health-care costs.
Part of the problem is health-care inflation is on fire -- growing at a rate of more than 7% every year. Were milk prices to grow at that rate, your $3.36 gallon of milk would cost $4.76 in five years.
What's more Medicare pushes those costs higher as the single biggest buyer of health care services in our country. If we were really honest with ourselves we'd recognize that there is no free lunch and that without reform there will be no Medicare.
That's a terrible legacy for our children. While Democrats say the plan will hurt seniors, it's not at all clear that would happen if you closely read the plan.
At its heart, Ryan's plan looks a whole lot like Medicare Advantage. Basically the plan is this -- seniors will be given a subsidy to buy care in the private market from pre-approved providers.
That subsidy -- about $15,000-- is about what the government spends now per person.
That number would grow over time with inflation.
If you wanted more coverage -- you'd have to pay for it yourself. The program will save money because private insurers will have to compete for seniors' business.
By the way, the program is means-tested, so poorer Americans and those with catastrophic illness would get more money.
More government involvement -- as Obamacare suggests -- is not a way to fix the healthcare problems of this country.
A common sense plan, like the one pitched by Ryan, is. And one more suggestion, tune out the Medicare talk coming from people who like the status quo and read Ryan's plan for yourself at www.paulryan.house.gov.
Gerri Willis joined Fox Business Network (FBN) in March of 2010. Willis is an anchor and personal finance reporter for the network.