Policymakers will be watching for a repeat of last year's good news when the Medicare trustees release their annual report to Congress on July 28.
Even if the recent spending slowdown continues, economists warn the trade-offs necessary to accommodate Medicare's growth as baby boomers move into the program will be difficult. Economists at the Altarum Institute warn that federal healthcare spending would need to grow 1 percentage point slower than the economy for tax revenue to remain less than 20% of the U.S. gross domestic product. The alternatives are tax increases, cuts to defense, education and transportation, or both, Altarum economists wrote last year.