First, HICP developments were affected by the recent increases in unprocessed food prices due to the BSE related health concerns and the measures taken to contain the outbreak of the foot-and-mouth disease. In addition, energy prices have remained volatile after the strong increases seen over 2000.
Over the past twenty-five years, however, per beneficiary Medicare spending has actually exceeded per capita GDP growth by about 2-1/2 percentage points per year. Thus, a significant slowing in the growth of medical costs per beneficiary will be needed to keep expenditures close to those projected in the CBO's intermediate-spending scenario.