Generation gap widened in social spending for elders compared to children

September 14, 2004

Per capita social welfare spending for elders was four times greater than for children in 2000, compared with only a three-fold difference in 1980. The growing gap in expenditures was due primarily to higher per capita medical expenses for older people - a phenomenon called the "graying " of the federal budget.

A new study found the public spending gap between children and elders increased by twenty percent despite the fact the U.S. poverty rates among children have consistently exceeded those for the elderly, and that in absolute numbers, three times as many children live in poverty, compared to elders. Researchers from The Children's Hospital of Philadelphia examined trends in social welfare spending for children and elders from 1980 to 2000 and the relationship of national economic trends to public spending patterns. The results are published in the September/October issue of Health Affairs.

"The balance of spending on elders and spending on children, is an important issue in evaluating the allocation of public resources," said Susmita Pati, M.D., a general pediatrician at The Children's Hospital of Philadelphia and principal investigator of the study. "Though children represent an increasing proportion of the population living in poverty, the topic has received little attention."

Social welfare spending for each group as a percentage of the gross national product (GNP) remained relatively unchanged over the 20-year period - hovering between 4 and 5 percent of the GNP for children, and beginning and ending the period at 6.5 percent for elders. However, the gap in per capita spending between the two groups during this time period grew nearly 20 percent - from about an $11,000 difference in 1980 to a more than $13,000 difference in 2000.

The major component of social welfare spending for children has been in education, while for elders it has been in Social Security. The researchers obtained public spending data for social welfare programs, including social insurance, public aid, government health insurance, education and nutrition programs, for children and elders from U.S. federal agencies.

According to the authors, two other factors contributed to the increasing gap. During periods of recession, spending for children's programs suffered compared to spending on the elderly. In addition, federal budget policies have maintained guarantees of support for the elderly, while social welfare programs for children have devolved to state governments, where funding is less stable.

"Despite the economic expansion of the 1990s and persistent socioeconomic health disparities, the gap in per capita public spending between children and the elderly has continued to increase. A public discussion on the consequences of the current disparity in public spending structures for children and elders is necessary," said Dr. Pati.

The authors conclude that children represent an increasing proportion of the population living in poverty, and poverty has been shown to be associated with poor health outcomes. "Given that a large proportion of costly adult morbidities, such as cardiovascular disease and cancer, are associated with preventable childhood precursors, such as obesity and smoking, increasing and stabilizing investments in child health merit serious consideration," said Dr. Pati.

Co-authors of the study were Ron Keren, M.D., Evaline A. Alessandrini, M.D., and Donald F. Schwarz, M.D., M.P.H., all from The Children's Hospital of Philadelphia.
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Founded in 1855 as the nation's first pediatric hospital, The Children's Hospital of Philadelphia is ranked in 2004 as the best pediatric hospital in the nation in 2004 by U.S.News & World Report and in 2003 by Child magazine. Through its long-standing commitment to providing exceptional patient care, training new generations of pediatric healthcare professionals and pioneering major research initiatives, Children's Hospital has fostered many discoveries that have benefited children worldwide. Its pediatric research program is among the largest in the country, ranking second in National Institutes of Health funding among children's hospitals. In addition, its unique family-centered care and public service programs have brought the 430-bed hospital recognition as a leading advocate for children and adolescents from before birth through age 19. Children's Hospital operates the largest pediatric healthcare system in the U.S. with more than 40 locations in Pennsylvania, New Jersey and Delaware.

Children's Hospital of Philadelphia

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