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Medicare, Obamacare future? Snip, snip, snip.

Medicare and the new federal health-insurance program will boost costs that Congress will have to rein in.

In this photo taken Jan. 23, 2011, Morty McKenna, is seen in his Pembroke Pines, Fla., home. Nearly a year after the national health care overhaul. Mr. McKenna and his wife are covered by a Medicare Advantage policy. The reform did not tackle rising costs in a meaningful way, which means that Congress will be forced to cut costs.

J Pat Carter/AP/File

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Congress is going to have to tackle rising health-care costs in Medicare and "Obamacare." House Republicans can try to repeal Obamacare or starve it for funds. Democrats can beat back such attempts. But the laws of economics still rule.

And so far health-care spending remains out of control. In 2009 it consumed 17.6 percent of the US gross domestic product, up one percentage point from the year before. It's more than twice as costly as what other advanced nations spend as a share of GDP. Yet America's average life expectancy is lower and it's advancing more slowly.

The high cost weakens America's international competitiveness. It also has hit poor people hard. Lawmakers thus must get more serious about cost controls. The question is how.

The health-care law passed last year was billed as a cost-cutter. It aims to extend health-care coverage to nearly all Americans without raising taxpayer costs too much.

The one reform Congress considered that really could have begun to change the cost equation – a so-called "public option" where government insurance would compete with the private sector – was dropped. The result: a system with far more bureaucracy and administrative costs than those of other industrial nations, says Wendell Potter, a former spinmeister for a major health insurance company. He calls the current bill "the Health Insurance Profit Protection and Enforcement Act."

Opponents of Obamacare are big obstacles to cutting health-care costs, says Mr. Potter, who is promoting his new book, "Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans."


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