Health care spending will consume about half of the U.S. economy in 75 years if nothing is done to curb growing costs, according to a Congressional Budget Office report released on Tuesday....

CBO Director Peter Orszag on Tuesday said that policymakers are focusing on the wrong issue by weighing the effects of the aging baby boom generation on health care costs rather than looking into treatment effectiveness and quality.

"The nature of the long-term fiscal problem has been misdiagnosed," Orszag said, adding that the aging population "is not by any means the main factor" behind the projected rise in cost growth. He noted that many new medical treatments and tests are "of dubious value." He said that in their efforts to stem the growth of health care costs, Congress and federal policymakers need to promote cost effectiveness and "evidence-based" medicine....

Orszag announced that CBO will begin releasing long-term budget projections that include health care spending estimates annually instead of biannually. He also said the office will be hiring 20 to 25 additional health analysts during this fiscal year, strengthening the current team of about 35. In the next few months, CBO will release other reports that show "levers and options" to curb rising health costs, Orszag said....

The CBO report is available online (.pdf). Click here for more on this event, including video of Orszag's presentation.

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