Goodsurance
ES

Costs & IRMAA

CBO: Federal Health Spending Will Rise 65 Percent by 2036, With Medicare Adding 900 Billion Dollars

A new Congressional Budget Office report projects total federal health insurance subsidies will climb from 2.4 trillion dollars in 2026 to 3.9 trillion dollars by 2036, with Medicare subsidies accounting for the largest single share of the increase.

By the Goodsurance editorial teamJuly 22, 2026

The Congressional Budget Office released its annual health-subsidy report on July 23, 2026, projecting that federal spending on health coverage will grow 65 percent over the next decade. In 2026, federal health insurance subsidies total an estimated 2.4 trillion dollars, equal to 7.4 percent of gross domestic product. By 2036, CBO projects that figure will reach 3.9 trillion dollars, or 8.4 percent of gross domestic product. The 10-year total across all federal health programs is projected at 33.6 trillion dollars.

Medicare is the single largest contributor to the growth, with subsidies projected to rise by approximately 900 billion dollars over the window. An average of 318 million Americans are projected to have health coverage in any given month over the period.

The report provides the baseline Congress uses when evaluating proposed changes to Medicare, Medicaid, and marketplace programs. For Medicare enrollees, the numbers underscore the program's central role in the federal budget and the pressure long-run spending growth places on program sustainability, premiums, and benefit decisions. CBO projections do not predict cuts; they frame the financial environment in which any future legislative changes would be made.

CBO projects Medicare will add 900 billion dollars to federal health spending by 2036, the largest single driver of a projected 65 percent rise.

In plain words

A government budget office says the federal government will spend much more on health coverage over the next 10 years. In 2026 it spends about 2.4 trillion dollars on health insurance. By 2036 that is expected to rise to 3.9 trillion dollars. Medicare causes most of that increase, adding about 900 billion dollars. This report does not predict benefit cuts. It is a forecast leaders use when discussing health spending.

Understand the basics first

Source: Congressional Budget Office
Read at the source →

More news

Other stories on what is moving in Medicare.

Costs & IRMAA

Medicare Finalizes 2027 Outpatient Rule, Cutting Drug Costs for Patients at Hospital Clinics

CMS issued a final rule November 4 that sets a 2.3 percent hospital outpatient payment increase for 2027 and lowers what Medicare pays hospitals for 340B-acquired drugs, projecting average savings of about 900 dollars for beneficiaries who receive a qualifying drug at a hospital outpatient department.

November 5, 2026

Costs & IRMAA

Nearly All Medicare Stand-Alone Drug Plan Members Will Face a Deductible in 2027, With Averages Up Sharply

A KFF analysis of 2027 Part D plan designs finds average deductibles rising to 643 dollars for stand-alone plan enrollees and 489 dollars for Medicare Advantage drug plan members, while the share of enrollees subject to any deductible expanded in both plan types.

October 30, 2026

Costs & IRMAA

CMS Finalizes 2027 Medicare Dialysis Payment Rate at 297 Dollars and 52 Cents, With a Larger Add-On for Home Dialysis Training

A final rule issued October 28 sets the per-treatment base rate for kidney dialysis facilities and raises the payment designed to encourage training patients to do dialysis at home.

October 29, 2026

Costs & IRMAA

Medicare's Hospital Fund Is Projected to Fall Short of Full Payment Capacity by 2033, Trustees Report Finds

The 2026 Medicare Trustees Report projects the Part A Hospital Insurance fund will be partially depleted in 2033, at which point incoming revenues would cover only 89 percent of covered costs, absent new legislation.

October 26, 2026

Costs & IRMAA

KFF: Nearly Half of Traditional Medicare Beneficiaries Hold Medigap, as Average Monthly Premiums Reach 244 Dollars

A KFF analysis released two days before open enrollment finds 12.9 million people carry supplemental Medigap policies, that average premiums rose 7 percent in a single year, and that Plan G now covers nearly half of all policyholders.

October 15, 2026

Costs & IRMAA

Social Security Confirms 3.6 Percent Benefit Increase for 2027, the Largest Since 2023

The Social Security Administration released its official cost-of-living adjustment today, finalizing a figure that carries direct implications for what Medicare beneficiaries pay for Part B coverage next year.

October 14, 2026