The document summarizes key points from a presentation on federal health spending. It notes that net interest outlays are projected to increase as the main contributor to growing total deficits through 2033. Primary deficits are projected to decrease slightly over that period. Federal spending on major health programs like Medicare, Medicaid, and marketplace subsidies are also projected to rise as percentages of GDP over the long term. The presentation discusses ongoing CBO analysis of issues like health insurance coverage, health care spending projections, and cost estimates of recent legislation. Areas being monitored post-pandemic include demand for services, telehealth, workforce issues, and Medicaid eligibility policies.

1. Presentation at a Trustee Briefing of the Committee for Economic
Development of The Conference Board
May 16, 2023
Carrie Colla
Director, Health Analysis Division
Federal Health Spending Update
For information about the meeting, see www.ced.org/people/trustees/briefings-public.

2. 2
The Budgetary Context

3. 3
Congressional Budget Office, An Update to the Budget Outlook: 2023 to 2033 (May 2023), www.cbo.gov/publication/59096. Years are fiscal years. Primary deficits exclude net outlays
for interest.
Total Deficits, Primary Deficits, and Net Interest Outlays
In CBO’s updated
projections, net interest
outlays increase by
1.1 percent of GDP from
2023 to 2033 and are the
main contributor to the
growth of total deficits.
Primary deficits decrease by
0.1 percent of GDP over that
period.
Percentage of Gross Domestic Product

4. 4
Health Care in the Budget

5. 5
Data source: Centers for Medicare & Medicaid Services.
National Health Expenditures
Health care spending in the
United States has grown
over time. Since 1960, it has
more than tripled as a
percentage of GDP.
0
5
10
15
20
25
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
Percentage of Gross Domestic Product

6. 6
Congressional Budget Office, The 2022 Long-Term Budget Outlook (July 2022), www.cbo.gov/publication/57971.
Federal Spending, by Category
Over the long term, net
spending for interest and
outlays for the major health
care programs and Social
Security are projected to rise
in relation to GDP; other
spending, in total, is
projected to decline.

7. 7
Projected
0
2
4
6
8
10
2008 2013 2018 2023 2028 2033 2038 2043 2048 2053
Medicaid, CHIP, and
Marketplace Subsidies
Medicare
Percentage of Gross Domestic Product
Data source: Congressional Budget Office. Years are fiscal years. FY = fiscal year; CHIP = Children’s Health Insurance Program.
Federal Outlays for Major Health Care Programs
Projections for Major Health
Care Programs for FY 2023
Billions of Dollars
Medicare 820
Medicaid 589
Marketplace Subsidies 81
Children’s Health
Insurance Program 18

8. 8
Congressional Budget Office, Federal Subsidies for Health Insurance Coverage for People Under 65: 2022 to 2032 (June 2022), www.cbo.gov/publication/57962.
Subsidies for Employment-Based Health Insurance Coverage
As a percentage of GDP,
federal subsidies for
employment-based
coverage are projected to
grow over the coming
decade.
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032
Percentage of Gross Domestic Product

9. 9
Health Policy After the Pandemic

10. 10
Ongoing Analysis
§ Budget baseline
– Impact of the coronavirus pandemic
– Demographics (fertility, mortality)
§ Insurance coverage
§ Projections of health care spending
Recent Reports
§ A description of who was uninsured in 2019
and why
§ Review of health care prices by payer
§ Single-payer series: budget impact,
financing, macroeconomic impact
§ Drug prices and innovation
Recent Analysis of Legislation,
Including Cost Estimates
§ Surprise billing
§ Legislation in response to the pandemic
– Medicaid continuous coverage
– Timing of the public health emergency
§ Expansion of Affordable Care Act (ACA)
subsidies in the American Rescue Plan Act
(ARPA)
§ Medicare expansions: dental, vision,
hearing
§ Drug price negotiation
§ Redesign of Medicare Part D benefit
§ Immunosuppressant drugs
Types of CBO Products About Health Care

11. 11
§ Demand for services
§ Telehealth
§ Workforce issues and their role in supply of care
§ Mental health and substance use
§ Continuous eligibility and redetermination in Medicaid
§ Other issues
Post-Pandemic Issues CBO is Monitoring