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Congressional Budget Office
The Long-Term Costs of Major Health Care Programs:
Fiscal Implications and Projection Methods
Presentation to the Joint Network on the
Fiscal Sustainability of Health Systems,
Organisation for Economic Co-operation and Development,
Paris, France
February 16, 2015
Jessica Banthin, Ph.D.
Deputy Assistant Director, Health
Congressional Budget Office
1C O N G R E S S I O N A L B U D G E T O F F I C E
Who Makes Federal Budget Projections in the
United States?
■ Executive branch
■ Legislative branch
2C O N G R E S S I O N A L B U D G E T O F F I C E
What Projections Does the Congressional Budget Office Make?
■ 10-year baseline budget projections—three times per year
■ Long-term budget projections—once a year
3C O N G R E S S I O N A L B U D G E T O F F I C E
What Is the Purpose of CBO’s Budget Projections?
■ Illustrate implications of generally following current law
■ Serve as a benchmark for measuring proposed changes
4C O N G R E S S I O N A L B U D G E T O F F I C E
Federal Debt Held by the Public
5C O N G R E S S I O N A L B U D G E T O F F I C E
Debt Held by the Public, Total Spending, and Total Revenues
6C O N G R E S S I O N A L B U D G E T O F F I C E
Components of Total Revenues
7C O N G R E S S I O N A L B U D G E T O F F I C E
Components of Total Spending
8C O N G R E S S I O N A L B U D G E T O F F I C E
Federal Spending on Major Health Care
Programs, by Category
1999 2004 2009 2014 2019 2024 2029 2034 2039
0
1
2
3
4
5
6
7
8
Medicare
Medicaid, Children's
Health Insurance
Program, and
Exchange Subsidies
Percentage of Gross Domestic Product
Actual Extended Baseline Projection
9C O N G R E S S I O N A L B U D G E T O F F I C E
How is Health Care Spending Projected?
■ Next 10 years: detailed analysis of programs
■ Later years: fairly mechanical estimates
– Number of people who will receive benefits
– Growth in spending per beneficiary
10C O N G R E S S I O N A L B U D G E T O F F I C E
Changes in Population, by Age Group
11C O N G R E S S I O N A L B U D G E T O F F I C E
Causes of Projected Growth in Federal Spending for
Social Security and Major Health Care Programs
12C O N G R E S S I O N A L B U D G E T O F F I C E
Possible Approaches to Reducing Federal Health Care
Spending
■ Improve the health of the population
■ Reduce federal subsidies for health insurance
■ Reduce tax preferences for employment-based health insurance
■ Pay Medicare providers in different ways
■ Make larger structural changes to federal health care programs
■ Undertake other possible reforms

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The Long-Term Costs of Major Health Care Programs: Fiscal Implications and Projection Methods

  • 1. Congressional Budget Office The Long-Term Costs of Major Health Care Programs: Fiscal Implications and Projection Methods Presentation to the Joint Network on the Fiscal Sustainability of Health Systems, Organisation for Economic Co-operation and Development, Paris, France February 16, 2015 Jessica Banthin, Ph.D. Deputy Assistant Director, Health Congressional Budget Office
  • 2. 1C O N G R E S S I O N A L B U D G E T O F F I C E Who Makes Federal Budget Projections in the United States? ■ Executive branch ■ Legislative branch
  • 3. 2C O N G R E S S I O N A L B U D G E T O F F I C E What Projections Does the Congressional Budget Office Make? ■ 10-year baseline budget projections—three times per year ■ Long-term budget projections—once a year
  • 4. 3C O N G R E S S I O N A L B U D G E T O F F I C E What Is the Purpose of CBO’s Budget Projections? ■ Illustrate implications of generally following current law ■ Serve as a benchmark for measuring proposed changes
  • 5. 4C O N G R E S S I O N A L B U D G E T O F F I C E Federal Debt Held by the Public
  • 6. 5C O N G R E S S I O N A L B U D G E T O F F I C E Debt Held by the Public, Total Spending, and Total Revenues
  • 7. 6C O N G R E S S I O N A L B U D G E T O F F I C E Components of Total Revenues
  • 8. 7C O N G R E S S I O N A L B U D G E T O F F I C E Components of Total Spending
  • 9. 8C O N G R E S S I O N A L B U D G E T O F F I C E Federal Spending on Major Health Care Programs, by Category 1999 2004 2009 2014 2019 2024 2029 2034 2039 0 1 2 3 4 5 6 7 8 Medicare Medicaid, Children's Health Insurance Program, and Exchange Subsidies Percentage of Gross Domestic Product Actual Extended Baseline Projection
  • 10. 9C O N G R E S S I O N A L B U D G E T O F F I C E How is Health Care Spending Projected? ■ Next 10 years: detailed analysis of programs ■ Later years: fairly mechanical estimates – Number of people who will receive benefits – Growth in spending per beneficiary
  • 11. 10C O N G R E S S I O N A L B U D G E T O F F I C E Changes in Population, by Age Group
  • 12. 11C O N G R E S S I O N A L B U D G E T O F F I C E Causes of Projected Growth in Federal Spending for Social Security and Major Health Care Programs
  • 13. 12C O N G R E S S I O N A L B U D G E T O F F I C E Possible Approaches to Reducing Federal Health Care Spending ■ Improve the health of the population ■ Reduce federal subsidies for health insurance ■ Reduce tax preferences for employment-based health insurance ■ Pay Medicare providers in different ways ■ Make larger structural changes to federal health care programs ■ Undertake other possible reforms

Notas do Editor

  1. 2014 LTBO Figure 1-1
  2. 2014 LTBO Summary Figure 1, top panel
  3. 2014 LTBO Summary Figure 1, bottom panel
  4. 2014 LTBO Summary Figure 1, middle panel
  5. 2014 LTBO Figure 2-2