What are the Causes of Projected Growth in Spending for Social Security and Major Health Care Programs?
We’ve already noted that the media and many other got overly excited about a trivial delay in the date of the impending bankruptcy of the Medicare “trust fund”, as estimated by the Congressional Budget Office (CBO).
The CBO has followed up with a more sober article on its blog:
Under current law, spending for Social Security would increase from almost 5 percent of gross domestic product (GDP) in 2014 to more than 6 percent in 2039 and beyond (see the figure below). Even more of the anticipated growth is expected to come from the government’s major health care programs (Medicare, Medicaid, the Children’s Health Insurance Program, and subsidies offered through health insurance exchanges): CBO projects that, under current law, total outlays for those programs, net of Medicare premiums and certain other offsetting receipts, would grow much faster than the overall economy, increasing from just below 5 percent of GDP now to 8 percent in 2039.