Aging Connection: March 2008 - Ohio Department of Aging

Aging Connection

March 2008

Senior Benefit Costs Rise 24 Percent since 2000

The cost of government benefits for seniors soared to a record $27,289 per senior in 2007, according to a USA TODAY analysis. Social Security, Medicare and Medicaid costs grew dramatically faster than inflation and the growth in the senior population.

The average Social Security benefit per senior in 2007 was $13,184. That's a 24 percent increase above the inflation rate since 2000. Last year, for the first time, health care and nursing homes cost the government more than Social Security payments for seniors age 65 and older.

The federal government spent $952 billion in 2007 on elderly benefits, up from $601 billion in 2000. States chipped in another $27 billion in 2007, mostly for nursing homes.

Other findings include:

Medicare experienced the most explosive growth from 2000 to 2007. The Medicare prescription drug benefit, started in 2006, accounts for about one-fourth of the increase in Medicare, which provides health benefits for people 65 and older.
Long-term care costs per senior have declined slightly in the last three years because of a move away from nursing homes to less-expensive home care.
About 35 percent of the federal budget is spent on senior benefits, up from 32 percent in 2004.

USA TODAY used a variety of government data to calculate the cost of providing Social Security, medical benefits and long-term care to an aging population. Billions of dollars paid to non-seniors (i.e. the disabled, children and others in the programs) were exempted to create an estimate that focuses exclusively on seniors.

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