The Direct Impact of Medicare Spending on Employment and Tax Revenue

Research Report

The Direct Impact of Medicare Spending on Employment and Tax Revenue

Abstract

In addition to financing crucial health care services for millions of Americans, Medicare benefits the broader economy. The funds disbursed by the program support the employment of millions of workers, and the salaries paid to those workers generate billions of dollars of tax revenue. We estimate that Medicare directly financed 3.7 million jobs in the health care sector in 2019, accounting for 22 percent of all health care sector employment. The program also generated $71.0 billion in federal tax revenues, including $29.3 billion in Social Security and Medicare payroll taxes, and another $10.4 billion in state tax revenue.

Cross-Center Initiative

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