Perspective:

The rise of austerity politics has important implications for US health policy. Currently, there is broad agreement that the United States must slow rising health care costs. The new politics mean that the health care industry and medical providers should anticipate increasingly tough efforts to restrain spending on Medicare and Medicaid. However, the focus on limiting federal health care spending and generating budgetary savings may distract us from tackling the larger issue of restraining systemwide health care spending and not just federal spending. Rising spending on medical care is not only a problem of government budgeting, but also affects private insurers, employers, workers, and their families. To slow the rate of growth of health care costs and make both public and private insurance more affordable to individuals, reforms like raising Medicare’s eligibility age and reducing the federal share of Medicaid will not be sufficient. The United States needs meaningful and systemwide cost control in health care spending, not just budget gimmicks.