The Department of Health and Human Services runs the huge and fast-growing Medicare and Medicaid. These programs fuel rising health costs, distort markets, and are plagued by waste and fraud. The department also runs other costly subsidy programs, including Head Start, TANF, and LIHEAP. Growth in HHS spending is creating a federal fiscal crisis, and the 2010 health care law sadly makes the situation worse.
The department will spend $1.110 trillion in 2016, or about $8,880 for every U.S. household. After adjusting for inflation, spending has increased 105 percent since 2000. The department employs 72,000 workers and operates more than 529 subsidy programs.
- Medicare Reforms. Medicare should be transformed into a system based on vouchers, individual savings, and competitive insurance markets.
- Medicaid Reforms. Federal spending on low-income health care should be converted to block grants for the states.
- TANF and Welfare Spending. Welfare reforms in 1996 created Temporary Assistance for Needy Families, but such aid should be provided by private charities.
- Head Start and Other Subsidies. HHS funds a vast array of other subsidy programs, many of which are wasteful and ineffective.
- 2010 Health Care Legislation. The law expanded Medicaid, added new taxes and subsidies, created new bureaucracies, and did little to reduce cost growth in health care.
James Madison. A paraphrase from Elliot’s Debates regarding a proposed subsidy bill, House of Representatives, January 10, 1794.