Health Costs Would Rise 1% Under Senate Bill

Americans would see only a modest rise in health costs under the Senate's plan to extend coverage to 34 million people, government economic experts say in a new report. The study found that health spending, which accounts for about one-sixth of the economy, would increase by less than 1% than it otherwise would over the coming decade—even with so many more people receiving coverage.

Over time, cost-cutting measures could reduce annual increases in health spending, offering substantial savings in the long run. At the same time, however, yesterday's report cited the tax on "Cadillac" health plans, as well as reductions in annual increases to Medicare providers, as having potential to hold down costs. But the authors were skeptical that Congress could stand the political fallout, noting that the Medicare cuts "may be unrealistic." (More health care reform stories.)