WASHINGTON – If the United States can get private healthcare costs under control, federal budget deficits won't rise uncontrollably in the future, according to an  analysis released Thursday by the Center for Economic and Policy Research.

"The U.S. healthcare system is possibly the most inefficient in the world," said Dean Baker, CEPR's co-director. "We spend twice as much per person on healthcare as other advanced countries, but we have worse health outcomes, including a lower life expectancy. Without healthcare cost containment, such as allowing Medicare and a public option to negotiate directly with drug companies, it will be almost impossible to prevent exploding future budget deficits."

CEPR has created an interactive healthcare budget deficit calculator on its Web site that allows users to see that the bulk of projected U.S. budget deficits would disappear if the nation had the same per-person healthcare costs as any of 30 other countries, all of which enjoy longer life expectancies than the United States.

The U.S. government pays for approximately half of the country's healthcare – almost all of which is actually provided by the private sector – through programs like Medicare and Medicaid. Thus, the CEPR concludes, the bulk of projected rising U.S. budget deficits are due to skyrocketing healthcare costs.

The CEPR has updated its calculator to take into account new figures contained in the Congressional Budget Office's June 2009 Long-Term Budget Outlook.

CEPR officials note that while the current recession contributes to projected budget deficits, the calculator illustrates that the long-term budget implications are minimal in comparison to rising healthcare costs.

The Center for Economic and Policy Research is an independent, nonpartisan think-tank that was established to promote democratic debate on important economic and social issues.