The cost savings the Obama administration put in its 2010 health-care law and latest deficit-reduction proposal also may be difficult to deliver over the long haul, Reinhardt said. They include penalties for hospitals whose patients are readmitted too often, "accountable care" programs that pay bonuses to health providers who work together more efficiently, and an independent panel empowered to recommend cuts if Medicare spending exceeds targets.
As the years go by and the easiest efficiencies already are deployed, productivity gains may become more difficult to achieve, Reinhardt said.
The administration's approach to the long-term budget challenge that health spending poses amounts to "all these tweaks here and there and a lot of praying" that expected cost savings materialize, he said.
"You're either going to have to really drastically cut spending, which would mean really shifting costs to the elderly, or raise revenues," Reinhardt said. "The long-term needs a whole social contract negotiation, and that would require mature adults to do."