Bernanke warns of long-term economic challenge posed by U.S. healthcare spending

In a largely upbeat speech Friday, Federal Reserve Chairman Ben Bernanke warned that the United States' sky-high healthcare costs need to be kept under control if the nation is going to get its finances in order.

"To achieve economic and financial stability," Bernanke said at the Federal Reserve Bank of Kansas City Economic Symposium, "U.S. fiscal policy must be placed on a sustainable path that ensures that debt relative to national income is at least stable or, preferably, declining over time. … The increasing fiscal burden that will be associated with the aging of the population and the ongoing rise in the costs of healthcare make prompt and decisive action in this area all the more critical."

Bernanke reiterated that the U.S. has the world's highest healthcare costs but has worse outcomes than other industrialized countries, notably on longevity and childhood mortality. Still, he expressed confidence that those issues are well-known and can be addressed by policymakers.

"All of these long-term issues were well-known before the crisis," he said. "Efforts to address these problems have been ongoing, and these efforts will continue and, I hope, intensify."