The Congressional Budget Office (CBO) has issued a report intended to assist Congress in upcoming deliberations about proposals that could substantially modify the U.S. health insurance system. The report includes estimates of the effects of various proposals on the federal budget, the number of people with insurance coverage, and healthcare spending.
The report notes that rising healthcare and health insurance costs pose a serious threat to the nation’s future fiscal condition, projecting that federal spending on Medicare and Medicaid will increase from around 4 percent of GDP in 2009 to nearly 6 percent in 2019 and 12 percent by 2050. Most of that increase will come from growth in per capita costs rather than from an aging population.
The report also notes that serious concerns exist about the efficiency of the healthcare system, but cautions that no simple solutions are available to reduce the level or control the growth of healthcare costs. Possible steps include restructuring the insurance market to discourage treatments that provide minimal benefits or changing incentives to encourage hospitals, physicians, and other providers to control costs. The report states that other approaches--including the wider adoption of health IT or greater use of preventive medical care--could improve people’s health but would probably generate either modest reductions in the overall costs of health care or increases in such spending within a 10-year budgetary time frame.
Read the report.
