Health Care Cost Growth and Demographic Trends Drive the Long-Term Fiscal Challenge

Abstract

Our updated simulations continue to illustrate that the long-term fiscal outlook is unsustainable. (See fig. 1) Despite some improvement in the long-term outlook for federal health and retirement spending, the federal government still faces large and growing structural deficits driven primarily by rising health care costs and known demographic trends. In fact, the oldest members of the baby boom generation are now eligible for Social Security retirement benefits and will be eligible for Medicare benefits in less than 3 years. According to the Social Security Administration nearly 80 million Americans will become eligible for Social Security retirement benefits over the next two decades an average of more than 10,000 per day. Although Social Security is important because of its size, the real driver of the long-term fiscal outlook is health care spending. Medicare and Medicaid are both large and projected to continue growing rapidly in the future.

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Document Details

Document Type
Technical Report
Publication Date
Apr 01, 2008
Accession Number
ADA481278

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  • United States Government Accountability Office

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