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Federal Health-Spending Growth Is America’s No. 1 Fiscal Challenge

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President at Paragon Health Institute
Brian Blase, Ph.D., is the President of Paragon Health Institute. Brian was Special Assistant to the President for Economic Policy at the White House’s National Economic Council (NEC) from 2017-2019, where he coordinated the development and execution of numerous health policies and advised the President, NEC director, and senior officials. After leaving the White House, Brian founded Blase Policy Strategies and serves as its CEO.
Senior Research Fellow at Paragon Health Institute
Drew Gonshorowski is a Senior Research Fellow at Paragon Health Institute. He brings a decade of experience conducting quantitative research and building models examining health policy and entitlement programs.
Over the next decade, total federal health-care expenditures will approach $25 trillion.

On February 7, the Congressional Budget Office (CBO) published its Budget and Economic Outlook with a sobering topline projection: Federal debt as a percentage of gross domestic product (GDP), or the size of the American economy each year, will reach a record amount in 2028 and continue to skyrocket thereafter. Other budget experts have written broadly about CBO’s budget outlook and how the actual situation is more dire for two reasons: (1) CBO must assume that current tax and spending programs expire, and Congress will almost certainly override the expiration for many of them, and (2) CBO assumes relatively low long-run interest rates, and if interest rates are higher, net-interest payments will increase. This post deals with the No. 1 problem: high and rapidly increasing spending on federal health-care programs.

Main Problem: Rising Cost of Federal Health-Care Programs and Interest Payments

Rising deficits and debt are largely the result of the growth in federal health-care programs and interest payments on the debt. While Social Security is also a problem, the program stabilizes as a share of GDP in the next decade under current law.

The full article can be found in National Review.

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