Health Care Spending Will Gobble the Federal Budget, Warns CBO

In a brief, slideshow analysis of
federal health care policy
, the Congressional Budget Office
warns that “federal spending for health care programs is growing
much faster than other federal spending and the economy as a
whole.” That’s partially because of the Affordable Care Act, though
the CBO points out that, even after Obamacare is fully implemented,
Medicare will continue to have the largest appetite for federal
dollars intended to support health care (intentions and results
aren’t the same thing, of course.) The CBO contemplates a few
cost-cutting tactics, few of which are likely to win fans, and some
of which might simply torpedo the provision of health care.

Health care expenditures

Ever-growing expenditures without revenues or even an economy to
match are a bit of a problem, as the CBO has attempted to explain in
the past, using words such as “unsustainable.”

Medicare spending growthDespite all of the attention paid to Obamacare‘s economic
idiocy, technical failures, and general incompetence as a piece of
policy, it doesn’t represent a big portion of the federal
government’s projected spending spree on health care issues. Most
of that money will go to the elderly, with Medicare expected to
consume $894 billion in 2023, compared to $560 billion for Medicaid
and CHIP, and $135 billion for Exchange subsidies and related

Using CBO numbers in 2009, the Mercatus Center’s Veronique de
prepared the graph
above, which shows Medicare spending turning
into the monster that eats…everything over the next few decades.
Note that projections of Medicare spending keep rising, and rather

Since all of this looks to get spendy—well,
spendier—really fast, the CBO contemplates a few
approaches for trimming the price tag which “might (or might not)
help the federal budget.” Among those are taxing, bribing, and
nagging people into healthier behavior, capping federal Medicaid
payments (an approach that would kneecap the current push to
expand Medicaid rolls), and paying less to medical

It’s a good thing crappy compensation from government programs
isn’t already an issue for physicians. Oh…wait.

Oh, yes. Look for the federal government’s forays into health
policy to be an ever-more expensive problem in years to come.

from Hit & Run

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