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Restructure Medicare & Medicaid: Observations About America’s Healthcare System 1) High Expenses — however measured, the costs are high: a) total dollars; b) share of GDP relative to other countries; c) cost relative to ability to pay (government, business, or individual), and 2) Inefficiencies — both the data and the insights of doctors, nurses, patients, and healthcare professionals identify opportunities for more efficient communication, data sharing and cost saving. KP www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 269 Restructure Medicare & Medicaid: Mathematical Challenge Related to Government Healthcare Programs Facing USA Inc. per CBO Forecasts Medicare & Medicaid Have Been Crowding Out Spending for Other Federal Programs and are Projected to Exceed All Federal Revenue by 2080E Federal Revenue & Medicare / Medicaid Spending as % of GDP, 1965 — 2080E FE i Federal Revenue as % of GDP (forecast based on historical trend line) Federal Spending on Medicare & Medicaid as 5% % of GDP Federal Revenue & Medicare / Medicaid Spending as % of GDP 0% 1965 1975 1985 1995 2005 2015E 2025E 2035E 2045E 2055E 2065E 2075E P Source: CBO Long-Term Budget Outlook alternative fiscal scenario, 6/10. (@ EB) www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 270 HOUSE_OVERSIGHT_020976