Health-Related Options for Reducing the Deficit: 2014 to 2023

December 5, 2013

This document is a reprint of Chapter 5 of Congressional Budget Office, Options for Reducing the Deficit: 2014 to 2023 (November 2013).

Most of the 16 options in this report would either decrease federal spending on health programs or increase revenues (or equivalently, reduce tax expenditures) as a result of changes in tax provisions related to health care. Some options would result in a reallocation of health care spending—from the federal government to businesses, households, or state governments, for example—and most would give parties other than the federal government stronger incentives to control costs while exposing them to more financial risk.

Eleven of the options are similar in scope to those in CBO’s previous volumes of budget options. For each of those options, the text provides background information, describes the possible policy change or changes, presents the estimated effects on spending or revenues, and summarizes arguments for and against the changes. The other five options—Options 1, 6, 7, 10, and 15—address broad approaches to changing federal health care policy, all of which would offer lawmakers a variety of alternative ways to alter current law.

* For options primarily affecting mandatory spending or revenues, savings sometimes would derive from changes in both. When that is the case, the savings shown include effects on both mandatory spending and revenues. For options primarily affecting discretionary spending, the savings shown are the decrease in discretionary outlays.