government
CBO: Health spending will rise sharply under current law
NEWS IN BRIEF — Posted June 18, 2012
Spending on major federal health care programs will grow from more than 5% of the gross domestic product today to nearly 10% in 2037 and continue to increase after that if current laws remain in place, the Congressional Budget Office reported in its 2012 long-term budget outlook released on June 5.
“Altogether, the aging of the population and the rising cost of health care would cause spending on the major health care programs and Social Security to grow from more than 10% of GDP today to almost 16% of GDP 25 years from now,” the report concluded.
If lawmakers continue certain policies that have been in place for several years or modify other provisions of current law that they deem difficult to sustain for a long period, “the increase in spending on health care programs and Social Security would be even larger,” according to the report.
The findings underscore the failures of the health system reform law to keep costs down, according to statements from Republican lawmakers on Capitol Hill.
“This report’s findings are chilling: debt reaching 200% of our economy and potentially causing a full-blown financial crisis; health care spending rising unabated to record levels; and Medicare and Social Security on a glide path to insolvency,” said Sen. Orrin Hatch (R, Utah), the lead Republican on the Senate Finance Committee. Hatch highlighted a finding in the report that federal spending for Medicare and Medicaid rose from 2.2% of GDP in fiscal year 1985 to 5.6% in 2011.
Republicans, however, want to address federal spending “by ending the Medicare guarantee for seniors, unloading the financial risk of future health care cost growth onto elderly and disabled individuals,” said Rep. Chris Van Hollen (D, Md.), the House Budget Committee’s lead Democrat. He spoke during the panel’s hearing on CBO’s long-term budget outlook.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2012/06/18/gvbf0618.htm.