Budget Report Projects Cost of Health Care Over 10 Years

Federal News

Each year the Congressional Budget Office prepares “baseline” budget projections for the next 10 years. The newest report projects that government spending for Medicare, Medicaid and other health care programs will more than double over the next 10 years to $1.8 trillion, or 7.3 percent of the country’s total economic output. Health care spending increases are due mainly to the aging population and rising treatment costs. Medicare accounts for about half of the cost, Medicaid accounts for about one-third of the cost, and the rest is attributed to new federal subsidies to help lower income Americans purchase insurance under the Affordable Care Act. The report also includes an alternative scenario in which Congress extends all Bush era tax cuts are scheduled to expire at the end of 2012 and repeals automatic spending cuts scheduled for early 2013. Under this scenario, the budget office projects the national debt will increase by $11 trillion by 2022.

The report is available on the Congressional Budget Office website.