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An Uncertain Outlook for Medicare Spending
The Brookings InstitutionLink to more items from this source
Jan. 26, 2015

"[CBO] projects that net Medicare expenditures will increase from 2.9 percent of GDP in 2015 to 3.6 percent of GDP by 2025 -- an almost 25 percent increase in the share of GDP allocated to Medicare. But all of this increase can be accounted for by the aging of the baby boom generation: the total number of Medicare beneficiaries is projected to climb about 35 percent in the next 10 years.... [A]fter adjusting for inflation, Medicare spending per beneficiary is projected to rise only 1.2 percent per year over the next ten years ... Although some of this slowdown is well understood -- reflecting payment cuts under the [ACA] and the expiration of patents of a number of blockbuster drugs -- much of the slowdown in Medicare spending is not understood by analysts."

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