Health Care Costs

Despite the rise in U.S. health care spending and its growing impact on the overall economy, there have been no significant improvements to life expectancy or other measures of public health, according to a commentary in the New England Journal of Medicine by Congressional Budget Office Director Peter Orszag and Senior Analyst Philip Ellis.

The authors found that the rise in health care spending can mostly be attributed to new medical technologies and therapies, not to an increase in disease prevalence. The study also notes that a decline in out-of-pocket payments has contributed to an increase in health care costs.

Orszag and Ellis recommend that policymakers develop cost-saving strategies to help alleviate the long-term impact of rising health care costs on the economy. These efforts must consider the role of health care reform and Medicare and Medicaid policy, according to the authors (Orszag/Ellis, New England Journal of Medicine, 11/1).

CBO released a study on the issue Nov. 13.