What is the long-term outlook for federal health care spending?
Total health care spending in the United States has been growing faster than the economy for decades and is expected to continue to do so. CBO projects that total private and public spending on health care will rise from roughly 18 percent of the economy today to nearly half of the economy by 2080. This overall trend has direct and significant effects on the federal budget. CBO projects non-interest federal spending will increase from 19 percent of the economy in 2008 to 32 percent by 2080 under current law, with nearly all of that increase in Medicare and Medicaid. Specifically, Medicare and Medicaid combined spending will increase from 4 percent of the economy in 2008 to more than 17 percent by 2080, while Social Security will increase from 4 percent of the economy to just over 6 percent during the same timeframe. The Medicare and Medicaid projections are driven in part by the aging of the population, but more importantly by the fact that health spending per person is outpacing growt
