New at Reason: Peter Suderman on Why ObamaCare Won’t Stop Rising Health Care Costs

July 30, 2010

Just days after President Obama first took office, Peter Orszag, in his new role as director of the Office of Management and Budget, held a fiscal summit in which he urged Washington policymakers to commit themselves to an agenda of fiscal responsibility. And for Orszag, the path to fiscal responsibility was through the nation’s rapidly growing entitlement programs—in particular, Medicare and Medicaid. Following up on an argument he’d made frequently as the director of the Congressional Budget Office, the nation’s top budgeteer declared that “the single most important thing we can do to improve the long-term fiscal health of our nation is slow the growth rate in health care costs.”  Reversing course on those projected costs, he said, “is the key to our fiscal future.”

If that’s so, writes Associate Editor Peter Suderman, then the door remains locked. There is now growing agreement that even under the rosiest assumptions, health care costs will continue to expand beyond the bounds of the budget, and that despite—or perhaps because of—the new health care law, the long-term fiscal problem remains.

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