Slowing healthcare inflation may have removed the need to overhaul either Medicare or Medicaid as part of a grand-deficit reduction deal, according to the senior Senate Democrat overseeing federal entitlement programs.
Sen. Max Baucus (D-Mont.), chairman of the Finance Committee, challenged the long-held assumption on Capitol Hill that any agreement to rein in the $16 trillion historic federal debt must include the two federal healthcare programs because they comprise more than 25% of all federal spending.
Baucus, who has repeatedly advocated including the programs in any overhaul in the past, said he now thinks it may be no longer necessary since the rate of healthcare spending growth over the next 10 years is expected to slow and match the economy's growth rate, according to the Congressional Budget Office. Also, even after the next 10 years when Medicare spending is projected to grow 1.6% faster than the economy that is still slower than the 2.5% faster growth in health spending seen in recent decades.