Major government programs > Item 1 - Purpose and Function of Our Government - General > PART I > Government 10-K

Government 10-K PART I Item 1 - Purpose and Function of Our Government - General

Major government programs

Published on Mon, May 17, 2021 9:00AM PDT | Updated Mon, May 17, 2021 10:53AM PDT

These summaries are provided as background for this report and should not be used to determine eligibility for any government program.

Social Security

Fiscal year, except as otherwise noted

1980

 

1990

 

2000

 

2010

 

2017

 

2018

 

2019

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Old Age and Survivors Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total benefits paid (in millions, calendar year)

$

105,074

 

$

222,993

 

$

352,706

 

$

577,448

 

$

798,722

 

$

844,924

 

$

902,833

 

 

na

 

Number of recipients

 

30,631,213

 

 

35,441,163

 

 

38,676,621

 

 

43,621,258

 

 

51,191,697

 

 

52,448,921

 

 

53,813,045

 

 

55,018,400

 

Average monthly benefit per recipient

$

304

 

$

525

 

$

759

 

$

1,107

 

$

1,304

 

$

1,347

 

 

1,403

 

 

1,446

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Disability Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total benefits paid (in millions, calendar year)

$

15,437

 

$

24,803

 

 

54,938

 

$

124,191

 

$

142,740

 

$

143,656

 

$

145,049

 

 

na

 

Number of recipients

 

4,699,942

 

 

4,225,933

 

 

6,624,978

 

 

10,034,403

 

 

10,450,339

 

 

10,213,144

 

 

9,980,251

 

 

9,731,824

 

Average monthly benefit per recipient

$

269

 

$

437

 

$

625

 

$

922

 

$

1,038

 

$

1,066

 

$

1,104

 

$

1,126

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Social Security

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total benefits paid (in millions, calendar year)

$

120,511

 

$

247,796

 

$

407,644

 

$

701,639

 

$

941,462

 

$

988,580

 

 

1,047,882

 

 

na

 

Number of recipients

 

35,331,155

 

 

39,667,096

 

 

45,301,599

 

 

53,655,661

 

 

61,642,036

 

 

62,662,065

 

 

63,793,296

 

 

64,750,224

 

Average monthly benefit per recipient

$

299

 

$

515

 

$

740

 

$

1,072

 

$

1,259

 

$

1,302

 

$

1,356

 

$

1,398

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

We limited the data in this table to the years presented to provide the most recent data but to also fit the table to the page. Additional years of data and more detail may be found on our website. Click “More detail” to access it.

na An “na” reference in the table means the data is not available.

Social Security is a federal government program that provides a source of income for individuals or their legal dependents (spouse, children, or parents) if they qualify for benefits. The program collects taxes from employees and employers and deposits the receipts into the two Social Security trust funds – the Old Age and Survivors Insurance (OASI) fund and the Disability Insurance (DI) fund. While the two are legally separate, they are often referred to together as OASDI.

In 2018, Social Security payments were $988 billion or 16% of our Government’s aggregate expenditures. Partially offsetting Social Security expenditures (but shown separately as revenue in our income statement), is $873 billion of Social Security tax receipts, which comprised 16% of our Government’s aggregate revenue.

Eligibility and enrollment15

The Social Security program pays benefits to qualified individuals out of the trust funds. Qualified individuals include, among others, disabled workers, retirees and their surviving spouses, and surviving children of deceased workers. Social Security benefits are subject to federal income taxes using a two-tiered scheme if the recipient’s income exceeds certain thresholds. According to the Wisconsin Fiscal Legislative Bureau, in 2019: “A total of 30 states…exempted social security income from taxation. Fourteen states taxed social security benefits in 2019. Four states followed current federal practice and taxed up to 85% of benefits, including Minnesota, which provided a second separate state subtraction, subject to an income-based phaseout. An additional ten states provided their own taxation treatment.”5

Disability

The Social Security Administration uses a five-step process to decide if a person is disabled, including verifying that:

  • the applicant’s earnings average less than a certain amount each month;
  • the applicant’s medical condition significantly limits his or her ability to do basic work activities – such as lifting, standing, walking, sitting, and remembering – for at least 12 months;
  • the applicant’s medical condition is of at least a certain severity, preventing the applicant from completing substantial gainful activity, regardless of age, education, or work experience;
  • the applicant’s medical impairment(s) prevents him or her from performing any of his or her past work; and
  • there is no other work the applicant can do despite his or her impairment(s) given his or her age, education, past work experience, and skills.

In general, to get disability benefits, an applicant must also meet two earnings tests, one related to how recently the applicant has worked and the other related to the duration of the applicant’s work history.

There are special rules for people who are blind.

Retirement

Those who pay Social Security taxes earn “credits” toward Social Security benefits. The number of credits needed to qualify for retirement benefits depends on one’s birthdate. People born in 1929 or later need 40 credits (10 years of work).

The more a recipient has earned during a working career, the greater the retirement benefit. Retirement age also affects the size of benefit payments. Age 62 is the earliest possible Social Security retirement age, and those who retire at this age will have reduced benefits. Age 66 is the earliest age at which one can retire with full benefits. Each extra year of work thereafter adds another year of earnings to your Social Security record, increasing your benefits until you start receiving benefits or you reach age 70.

Spouses who never worked or have low earnings can get up to half of a retired worker’s full benefit. Those who are eligible for both their own retirement benefits and spousal benefits are paid their own benefits first. Those whose spousal benefit is higher than their own retirement benefit will get a combination of benefits equaling the higher spousal benefit. Divorced people aged 62 and older whose marriage lasted 10 years or longer may be able to receive benefits on their ex-spouse’s record even if the ex-spouse has remarried.

Social Security replaces a percentage of a worker’s pre-retirement income based on their lifetime earnings. The amount of average wages that Social Security retirement benefits replaces varies depending on one’s earnings and when one chooses to start receiving benefits. According to the Social Security Administration, if benefits start at age 67, this percentage ranges from as much as 75% for very low earners, to about 40% for medium earners, and about 27% for high earners. If benefits start earlier than age 67, these percentages would be lower, and after age 67 they’d be higher.

Survivor benefits

Widows and widowers may be eligible to receive Social Security benefits at age 60, or at age 50 if suffering from a disability that started before or within seven years of the spouse’s death. Widows and widowers can take reduced benefits on one record, and then switch to full benefits on another record later. For example, a woman can take a reduced widow’s benefit at 60 or 62, and switch to her own full retirement benefit at full retirement age.

Children’s benefits

Children whose parents are disabled, retired, or deceased may be eligible for Social Security benefits. Biological children, adopted children, and dependent stepchildren of the worker are eligible. To get benefits, a child must have:

  • A parent who is disabled or retired and entitled to Social Security benefits; or
  • A parent who died after having worked long enough in a job where the parent paid Social Security taxes.

The child must also be any of the following:

  • Unmarried;
  • Younger than age 18;
  • 18-19 years old and a full-time student (no higher than grade 12); or
  • 18 or older and disabled. (The disability must have started before age 22.)

Enrollment

A person needs a Social Security number to get a job legally, and this nine-digit number remains one’s first and continuous link with Social Security. Information on how to apply for a new or replacement Social Security number and card can be found at https://www.ssa.gov/. Having this number and beginning work at a job that participates in the Social Security program enrolls one in the program. When an individual is ready to make a claim, he or she can apply to receive Social Security retirement benefits on the above-referenced site.

Funding and financial condition of the program16

Funding

The Social Security program is funded primarily by a 12.4% payroll tax levied on employers and workers (each pay 6.2%, self-employed individuals pay the entire 12.4%). During the periods discussed in this report, there were two temporary tax rate reductions. For calendar year 2010, most employers were exempt from paying the employer share of OASDI tax on wages paid to certain qualified individuals hired after February 3. For calendar years 2011 and 2012, the OASDI tax rate was reduced by 2 percentage points for employees and for self-employed workers, resulting in a 4.2% effective tax rate for employees and a 10.4% effective tax rate for self-employed workers. Reductions in tax revenue due to these lower tax rates were made up by transfers from the general fund of the Treasury to the OASI and DI trust funds.

The payroll tax is levied on employee earnings up to a maximum taxable amount, which varies each year. Recent maximum taxable earnings were:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1980

 

$

25,900

 

1990

 

$

51,300

 

2000

 

$

76,200

 

2010

 

$

106,800

 

2017

 

$

127,200

 

2018

 

$

128,400

 

2019

 

$

132,900

 

2020

 

$

137,700

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

When the Social Security trust funds have surpluses, our Government generally uses the excess funds to purchase Treasury securities. Therefore, the trust funds earn some interest income.

Financial condition

Social Security funds are deposited in trust funds. The table below shows that at the end of 2019, the OASDI trust funds had an aggregate balance of $2.9 trillion.

Old-Age and Survivors Insurance and Disability Insurance trust funds

Fiscal year

(In millions)

1980

 

 

1990

 

 

2000

 

 

2010

 

 

2017

 

 

2018

 

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total cash income 1

$

117,439

 

 

$

307,921

 

 

$

561,321

 

 

$

788,061

 

 

$

992,091

 

 

$

992,568

 

 

$

1,051,120

Social insurance and retirement receipts (payroll taxes)

 

113,209

 

 

 

281,656

 

 

 

480,584

 

 

 

631,687

 

 

 

850,618

 

 

 

854,747

 

 

 

914,303

Intergovernmental receipts:

 

4,230

 

 

 

26,265

 

 

 

80,685

 

 

 

156,281

 

 

 

141,396

 

 

 

137,745

 

 

 

136,690

Government employer share of employee retirement

 

1,204

 

 

 

5,567

 

 

 

7,637

 

 

 

14,936

 

 

 

17,499

 

 

 

18,193

 

 

 

18,055

Interest

 

2,340

 

 

 

15,991

 

 

 

59,796

 

 

 

118,502

 

 

 

86,512

 

 

 

83,809

 

 

 

82,504

Other

 

686

 

 

 

4,707

 

 

 

13,252

 

 

 

22,843

 

 

 

37,385

 

 

 

35,743

 

 

 

36,131

Other cash income

 

 

 

 

 

 

 

52

 

 

 

93

 

 

 

77

 

 

 

76

 

 

 

127

Total cash outgo 1

$

118,559

 

 

$

249,705

 

 

$

409,473

 

 

$

706,351

 

 

$

944,904

 

 

$

987,904

 

 

$

1,044,606

Benefit payments

 

115,514

 

 

 

243,263

 

 

 

402,104

 

 

 

695,459

 

 

 

933,897

 

 

 

976,566

 

 

 

1,032,919

Payments to railroad retirement

 

1,442

 

 

 

3,049

 

 

 

3,697

 

 

 

4,392

 

 

 

4,523

 

 

 

4,943

 

 

 

4,946

Interest payments

 

 

 

 

1,082

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Administrative expenses

 

1,494

 

 

 

2,273

 

 

 

3,606

 

 

 

6,390

 

 

 

6,246

 

 

 

6,423

 

 

 

6,626

Beneficiary services and other

 

109

 

 

 

38

 

 

 

66

 

 

 

110

 

 

 

238

 

 

 

(28)

 

 

 

115

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Surplus (deficit)

$

(1,120)

 

 

$

58,216

 

 

$

151,848

 

 

$

81,710

 

 

$

47,187

 

 

$

4,664

 

 

$

6,514

Adjustment to balances

 

 

 

 

 

 

 

 

 

 

3

 

 

 

(2)

 

 

 

(1)

 

 

 

(1)

Fund balance, end of year:

$

32,259

 

 

$

214,900

 

 

$

1,006,852

 

 

$

2,585,484

 

 

$

2,889,545

 

 

$

2,894,208

 

 

$

2,900,721

Invested balance

 

31,251

 

 

 

215,222

 

 

 

1,007,226

 

 

 

2,586,333

 

 

 

2,889,869

 

 

 

2,894,655

 

 

 

2,900,916

Uninvested balance

 

1,008

 

 

 

(322)

 

 

 

(374)

 

 

 

(849)

 

 

 

(324)

 

 

 

(447)

 

 

 

(195)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dollar amounts in this table may not agree to amounts for the same program in our financial statements or narrative discussion as 1) the data in this table may be on a different year (e.g. fiscal vs. calendar) basis and 2) the data in this table may be drawn from a source that prepares the data on an accrual rather than a cash basis.

†† Source: Office of Management and Budget.

††† Our website shows the OASI and DI trust fund financials separately. You can find them here.

1 Offsetting collections from Federal sources that are credited to the OASI account are treated as offsets to cash outgo rather than as cash income.

The Board of Trustees of OASI and DI Trust Funds projects the OASDI trust funds may become depleted as early as 2031. You can see their projections in Exhibit 99.06.

Medicare17

Fiscal year

(In thousands)

1980

 

1990

 

2000

 

2010

 

2017

 

2018

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total enrollment by part: 1

 

28,433

 

 

34,251

 

 

39,688

 

 

47,720

 

 

58,683

 

 

60,147

 

 

61,222

Part A (Hospital Insurance)

 

28,002

 

 

33,747

 

 

39,257

 

 

47,365

 

 

58,344

 

 

59,794

 

 

60,857

Part B (Medical Insurance)

 

27,278

 

 

32,567

 

 

37,335

 

 

43,882

 

 

53,446

 

 

54,798

 

 

56,115

Part C (Private Insurer-Provided Medicare)

na

 

 

2,017

 

 

6,856

 

 

11,692

 

 

19,816

 

 

21,336

 

 

22,942

Part D (Outpatient Prescription Drug Insurance)

na

 

na

 

na

 

 

34,772

 

 

44,480

 

 

45,778

 

 

47,197

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dollar amounts in this table may not agree to amounts for the same program in our financial statements or narrative discussion as 1) the data in this table may be on a different year (e.g. fiscal vs. calendar) basis and 2) the data in this table may be drawn from a source that prepares the data on an accrual rather than a cash basis.

†† Source: Office of Management and Budget.

††† We limited the data in this table to the years presented to provide the most recent data but to also fit the table to the page. Additional years of data and more detail may be found on our website. Click “More detail” to access it.

na An “na” reference in the table means the data is not available.

1 Starting in 1983, includes amounts from Postal Service.

Medicare is our country’s health insurance program for people age 65 or older. People younger than age 65 with certain disabilities, permanent kidney failure, or amyotrophic lateral sclerosis (Lou Gehrig’s disease) can also qualify for Medicare. The program helps with the cost of healthcare, but it does not cover all medical expenses or the cost of most long-term care. As of 2013, on average, Medicare covered about 66%18 of the healthcare charges for those enrolled. A person can buy a Medicare supplement policy from a private insurance company to cover some of the costs that Medicare does not. Medicaid may also cover a portion of costs for those who are eligible.

In 2019, Medicare provided benefits to 61 million Americans, 86% (53 million) of whom were age 65 and older and 14% (9 million) of whom were disabled.

In 2018, Medicare payments (net of premiums of $100 billion) were $692 billion or 11% of our Government’s aggregate expenditures. Partially offsetting these expenditures (but shown separately as a payroll tax revenue in our income statement) were $265 billion of Medicare tax receipts, which comprised 5% of our Government’s aggregate revenue.

Programs

Medicare is the combination of two separate programs with three parts:

  • the Hospital Insurance (HI) program, also known as Medicare Part A:
    • Part A covers in-patient hospital treatment along with some other medical services, with 60 million enrollees as of 2018; and
  • the Supplemental Medical Insurance (SMI) program, also known as Medicare Parts B and D:
    • Part B covers much of what Part A does not, such as physician visits, out-patient hospital treatments, and some drugs, with 55 million enrollees as of 2018; and
    • Part D is the newest addition to the Medicare program (introduced January 1, 2006) and provides subsidies for prescription drugs, with 46 million enrollees as of 2018.

Medicare Part C (aka Medicare Advantage) is a privately-run health insurance option available via Medicare, with 21 million enrollees as of 2018. Part C enrollees pay premiums for their Part B, as well as additional fees to the private insurer, while the federal government covers an amount similar to what it would pay for the person to be enrolled in traditional Medicare.

Eligibility and enrollment

Part A

People age 65 or older, who are citizens or permanent residents of the US, are eligible for Medicare Part A at no cost if they:

  • or their spouse receives or is eligible to receive Social Security benefits or railroad retirement benefits;
  • or their spouse worked long enough in a government job through which they paid Medicare taxes; or
  • are the dependent parent of a fully insured deceased child.

If they don’t meet these requirements, they may be able to get Medicare Part A by paying a monthly premium. People who are already receiving Social Security retirement or disability benefits will be automatically enrolled in Medicare Parts A and B when they turn 65. Those who aren’t yet receiving Social Security benefits should enroll in Medicare Part A even if they don’t plan to retire at age 65. The enrollment period begins three months before the month of an applicant’s 65th birthday and continues for three months after the month he or she turns 65. One can enroll online at https://www.ssa.gov/, by phone, or by visiting a local Social Security Administration office.

Part B

Individuals eligible for Medicare Part A at no cost can enroll in Medicare Part B by paying a monthly premium. Some people with higher incomes will pay a higher monthly Part B premium. A person who is not eligible for Part A at no cost, can purchase Part B without having to buy Part A, if the person is 65 or older and is a US citizen or a lawfully admitted noncitizen who has lived in the US for at least five years. Those who fail to enroll in Part B when they are first eligible may be subject to a penalty if they enroll later. If, however, they are active employees past the age of 65 and are eligible for health insurance that their employer subsidizes, it may not be in their interest to enroll in Parts B or D until they retire.

Part C (Medicare Advantage)

Individuals who receive Part A and Part B benefits directly from our Government have original Medicare. Individuals who receive benefits from a Medicare Advantage organization or other company approved by Medicare have Medicare Advantage plans, which are offered by Medicare-approved private companies. Many of these plans provide extra coverage and may lower out-of-pocket costs. Individuals who have Medicare Parts A and B can join a Medicare Advantage plan.

Part D

Anyone who has Medicare Part A or Part B is eligible for Part D (Medicare prescription drug coverage). Joining a Medicare prescription drug plan, which charges an extra monthly premium, is voluntary. Some beneficiaries with higher incomes will pay a higher monthly Part D premium.

Participant costs

No part of Medicare pays for all of a beneficiary’s covered medical costs, and many costs are not covered at all. The program contains premiums, deductibles, and coinsurance, which the covered individual must pay out-of-pocket. Some people may qualify to have other governmental programs (such as Medicaid) pay premiums and some or all of the costs associated with Medicare. Deductibles and coinsurance are paid directly to providers and are excluded from this report. Premiums are reported in the financial statements within this report as reductions of Medicare expenditures rather than as revenues. See the overall discussion of what revenues are netted against expenses and why at Receipts that offset expenses above.

Most Medicare enrollees do not pay a monthly Part A premium, because they (or a spouse) have had 40 or more 3-month quarters in which they paid Federal Insurance Contributions Act (FICA) taxes. The benefit is the same no matter how much or how little the beneficiary paid as long as the minimum number of quarters is reached. Medicare-eligible persons who do not have 40 or more quarters of Medicare-covered employment (or a spouse who does) may buy into Part A for a monthly premium of:

  • $259 per month (as of 2021) for those with 30 – 39 quarters of Medicare-covered employment, or
  • $471 per month (as of 2021) for those with fewer than 30 quarters of Medicare-covered employment and who are not otherwise eligible for premium-free Part A coverage.

Most Medicare Part B enrollees pay an insurance premium for this coverage. Part B premiums for 2021 are $148.50 to $504.90 per month, depending on the enrollee’s yearly income, with the highest premium paid by individuals earning more than $500,000 or married couples earning more than $750,000.

Premiums for Parts C and D vary by plan, and some Part C plans do not charge premiums.

Funding and financial condition of the program

Funding

Each part of Medicare relies on different funding mechanisms:

  • Part A is largely funded by a 2.9% payroll tax levied on employers and workers (each pay 1.45%; self-employed individuals pay the entire 2.9%). Beginning in 2013, the rate of Part A tax on earned income exceeding $200,000 for individuals ($250,000 for married couples filing jointly) rose to 3.8% (paid 2.35% by employee and 1.45% by employer, or 3.8% by a self-employed individual), in order to pay part of the cost of the subsidies mandated by the Patient Protection and Affordable Care Act (PPACA).
  • Part B is funded primarily by revenue from the federal government general fund and by premiums paid by Medicare enrollees.
  • Part C is funded by the Medicare Trust Funds at a fixed amount per month, plus any additional premiums paid by Part C plan members.
  • Part D is financed primarily by revenue from the federal government general fund with small amounts coming from enrollee premiums (16% of funding in 2019) and transfers from states (12% of funding in 2019). In 2006, a surtax was added to Part B premiums for higher-income seniors to partially fund Part D.

Financial condition

Each of the three primary parts of Medicare (Parts A, B, and D) has its own account managed by trustees (a trust fund account). Part C does not have a trust fund.

Medicare trust funds financials

At the end of fiscal year 2019, the HI (Part A) trust fund had a balance of $199 billion and the SMI (Parts B and D) trust fund had a balance of $104 billion, for a combined balance of $303 billion.

Fiscal year

(In millions)

 

1980

 

 

1990

 

 

2000

 

 

2010

 

 

2017

 

 

2018

 

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total cash income

 

$

35,690

 

 

$

125,697

 

 

$

248,921

 

 

$

505,217

 

 

$

718,533

 

 

$

746,142

 

 

$

785,384

Social insurance and retirement receipts (payroll taxes)

 

 

23,217

 

 

 

68,556

 

 

 

135,529

 

 

 

180,068

 

 

 

255,930

 

 

 

260,659

 

 

 

277,572

Excise taxes (SMI)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,147

 

 

 

4,095

 

 

 

2,437

Intergovernmental receipts:

 

 

9,529

 

 

 

45,531

 

 

 

91,333

 

 

 

250,528

 

 

 

347,119

 

 

 

358,230

 

 

 

373,067

Government employer share for government employee retirement 1

 

 

249

 

 

 

2,153

 

 

 

2,630

 

 

 

4,042

 

 

 

4,416

 

 

 

4,478

 

 

 

4,479

Interest

 

 

1,477

 

 

 

9,370

 

 

 

13,630

 

 

 

17,602

 

 

 

9,769

 

 

 

9,733

 

 

 

9,673

Federal payment (OASDI taxes)

 

 

 

 

 

 

 

 

8,787

 

 

 

13,760

 

 

 

24,206

 

 

 

24,192

 

 

 

23,781

Federal contributions and other

 

 

7,803

 

 

 

34,008

 

 

 

66,286

 

 

 

215,124

 

 

 

308,728

 

 

 

319,827

 

 

 

335,134

Premium income

 

 

2,944

 

 

 

11,607

 

 

 

21,907

 

 

 

65,307

 

 

 

100,029

 

 

 

111,738

 

 

 

120,150

Other cash income 2

 

 

 

 

 

3

 

 

 

152

 

 

 

9,314

 

 

 

11,308

 

 

 

11,420

 

 

 

12,158

Total cash outgo

 

$

35,034

 

 

$

109,709

 

 

$

219,022

 

 

$

525,640

 

 

$

708,298

 

 

$

711,502

 

 

$

782,547

Benefit payments

 

 

33,937

 

 

 

107,172

 

 

 

214,867

 

 

 

518,832

 

 

 

699,784

 

 

 

701,888

 

 

 

772,844

Administrative expenses 3

 

 

1,080

 

 

 

2,298

 

 

 

3,042

 

 

 

5,279

 

 

 

5,527

 

 

 

6,660

 

 

 

6,660

Payments to the Patient-Centered Outcomes Research Trust Fund

 

 

 

 

 

 

 

 

 

 

 

 

 

 

131

 

 

 

144

 

 

 

145

Other

 

 

17

 

 

 

239

 

 

 

1,113

 

 

 

1,529

 

 

 

2,856

 

 

 

2,810

 

 

 

2,898

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Surplus (deficit)

 

$

656

 

 

$

15,988

 

 

$

29,899

 

 

$

(20,423)

 

 

$

10,235

 

 

$

34,640

 

 

$

2,837

Adjustment to balances

 

 

 

 

 

 

 

 

 

 

 

22

 

 

 

1

 

 

 

5

 

 

 

(63)

Fund balance, end of year

 

$

19,029

 

 

$

110,158

 

 

$

213,968

 

 

$

350,842

 

 

$

265,528

 

 

$

300,173

 

 

$

302,947

Invested balance

 

 

19,214

 

 

 

110,535

 

 

 

213,934

 

 

 

349,203

 

 

 

268,424

 

 

 

301,002

 

 

 

303,341

Uninvested balance

 

 

(185)

 

 

 

(377)

 

 

 

34

 

 

 

1,639

 

 

 

(2,896)

 

 

 

(829)

 

 

 

(394)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dollar amounts in this table may not agree to amounts for the same program in our financial statements or narrative discussion as 1) the data in this table may be on a different year (e.g. fiscal vs. calendar) basis and 2) the data in this table may be drawn from a source that prepares the data on an accrual rather than a cash basis.

†† Source: Office of Management and Budget.

††† Our website shows the HI and SMI trust fund financials separately. You can find them here.  

1 Starting in 1983, includes amounts from Postal Service.

2 For years after 1986, SMI receipts for kidney dialysis. For years after 2004, includes Medicare refunds, which were shown as offsets to cash outgo in years prior to 2005.

3 For 1989 and 1990, includes transactions and balances of the HI and SMI Catastrophic Insurance trust funds, which began in 1989 and were abolished in 1990.

The Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds project the Medicare HI (Part A) trust fund may become depleted as early as 2023. See their projections in Exhibit 99.07.

Medicaid and Children’s Health Insurance Program (CHIP)19

Federal fiscal year, except as otherwise noted

1980

 

1990

 

2000

 

2010

 

2017

 

2018

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Medicaid

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Spending (in billions) 1

 

$

25.2

 

 

$

72.2

 

 

$

206.2

 

 

$

401.5

 

 

$

600.0

 

 

$

616.1

 

 

$

626.9

Average monthly enrollment (in millions) 1

 

19.6

 

 

22.9

 

 

34.5

 

 

54.5

 

 

73.4

 

 

73.9

 

 

75.1

Spending per enrollee 1 (calendar year)

 

$

1,285

 

 

$

3,147

 

 

$

5,972

 

 

$

7,361

 

 

$

8,024

 

 

$

8,339

 

 

$

8,343

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total beneficiaries (in thousands of people) 2

 

21,605

 

 

25,255

 

 

41,212

 

 

63,730

 

 

na

 

 

82,940

 

 

na

Children

 

9,333

 

 

11,220

 

 

18,528

 

 

30,024

 

 

na

 

 

30,769

 

 

na

Adults

 

4,877

 

 

6,010

 

 

8,538

 

 

15,368

 

 

na

 

 

28,870

 

 

na

Disabled

 

2,911

 

 

3,718

 

 

6,688

 

 

9,341

 

 

na

 

 

9,062

 

 

na

Aged

 

3,440

 

 

3,202

 

 

3,640

 

 

4,289

 

 

na

 

 

6,086

 

 

na

Unknown

 

1,044

 

 

1,105

 

 

3,817

 

 

4,709

 

 

na

 

 

8,153

 

 

na

Total enrollees (in thousands of people, to the nearest 100,000) 3

 

19,600

 

 

22,900

 

 

34,500

 

 

54,500

 

 

73,400

 

 

73,900

 

 

75,100

Children

 

na

 

 

na

 

 

16,100

 

 

26,400

 

 

27,900

 

 

28,100

 

 

28,400

Adults

 

na

 

 

na

 

 

6,900

 

 

13,100

 

 

15,400

 

 

15,600

 

 

15,700

Newly eligible adults

 

na

 

 

na

 

 

 

 

 

 

12,200

 

 

12,200

 

 

12,600

Disabled

 

na

 

 

na

 

 

6,700

 

 

9,200

 

 

10,600

 

 

10,700

 

 

10,800

Aged

 

na

 

 

na

 

 

3,600

 

 

4,900

 

 

5,800

 

 

6,000

 

 

6,200

Territories

 

na

 

 

na

 

 

900

 

 

1,000

 

 

1,400

 

 

1,400

 

 

1,400

State fiscal year

 

1980

 

 

1990

 

 

2000

 

 

2010

 

 

2017

 

 

2018

 

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Medicaid share of state budgets (all federal and state funds) 4

 

na

 

 

 

12.5%

 

 

 

19.1%

 

 

 

22.2%

 

 

 

28.9%

 

 

 

29.2%

 

 

na

Medicaid share of state budgets (state general funds only; no federal) 4

 

na

 

 

 

9.5%

 

 

 

15.0%

 

 

 

14.8%

 

 

 

19.9%

 

 

 

20.0%

 

 

na

Medicaid as share of state budgets (all state funds; no federal) 4

 

na

 

 

 

6.9%

 

 

 

11.0%

 

 

 

11.6%

 

 

 

16.0%

 

 

 

16.3%

 

 

na

Children’s Health Insurance Program (CHIP) 5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average monthly enrollment (in millions)

 

na

 

 

na

 

 

2.1

 

 

5.4

 

 

na

 

 

na

 

 

na

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dollar amounts in this table may not agree to amounts for the same program in our financial statements or narrative discussion as 1) the data in this table may be on a different year (e.g. fiscal vs. calendar) basis and 2) the data in this table may be drawn from a source that prepares the data on an accrual rather than a cash basis. Details may not foot to total due to rounding.

†† Source: Centers for Medicare and Medicaid Services (CMS).

††† We limited the data in this table to the years presented to provide the most recent data but to also fit the table to the page. Additional years of data and more detail may be found on our website. Click “More detail on Medicaid” and “More detail on CHIP” to access it.

na An “na” reference in the table means the data is not available.

1 All numbers exclude CHIP-financed coverage. The amounts shown in this table may differ from those published elsewhere due to slight differences in the timing of data and the treatment of certain adjustments. The amounts may also differ from prior versions of MACStats due to changes in methodology by the CMS Office of the Actuary. Spending consists of federal and state Medicaid expenditures for benefits and administration, excluding the Vaccines for Children program. Enrollment counts are full-year equivalents and, for fiscal years prior to 1980, have been estimated from counts of persons served. Enrollment data for fiscal year 2017 is projected; those for fiscal years 2000 – 2019 include estimates for the territories.

2 Beneficiaries (enrollees for whom payments are made) are shown here because they provide the only historical time series data directly available prior to FY 1990. Most current analyses of individuals in Medicaid reflect enrollees. Beginning in fiscal year 1998, a Medicaid-eligible person who received only coverage for managed care benefits was included in this series as a beneficiary. Excludes Medicaid-expansion CHIP and the territories. Children and adults who qualify for Medicaid on the basis of a disability are included in the disabled category. In addition, although disability is not a basis of eligibility for aged individuals, states may report some enrollees age 65 and older in the disabled category. For fiscal years prior to 2017, this data does not recode individuals age 65 and older who are reported as disabled, due to lack of detail in the historical data. Due to the way eligibility is reported in the Transformed Medicaid Statistical Information System (T-MSIS), age must be used to separate beneficiaries eligible on the basis of age from those eligible based on disability. This means that the 2018 beneficiary count for the disabled category no longer includes anyone age 65 and older. Generally, individuals whose eligibility group is unknown are persons who were enrolled in the prior year but had a Medicaid claim paid in the current year. Due to the transition from the Medicaid Statistical Information System (MSIS) to T-MSIS, complete and valid data were not available for all states for several years and jumped to fiscal year 2018 because this was the most complete year of data available to develop the MACStats data.

3 The CMS temporarily stopped reporting numbers of beneficiaries in 2013. Accordingly, we also report enrollees. Details may not add up to the total. Total enrollees and enrollees by type were taken from two separate data sources.

4 The all federal and state funds category reflects amounts from any source. The state general funds category reflects amounts from revenues raised through income, sales, and other broad-based state taxes. The all state funds category reflects amounts from any non-federal source; these include state general funds, other state funds (amounts from revenue sources that are restricted by law for particular government functions or activities, which for Medicaid includes provider taxes and local funds), and bonds (expenditures from the sale of bonds, generally for capital projects).

5 CHIP numbers include adults covered under waivers. Enrollment for Territories for fiscal year 2000 and later is estimated.

Medicaid is a joint federal and state program that, together with the Children’s Health Insurance Program (CHIP), provides health coverage to more than 77.3 million Americans, including children, pregnant women, parents, seniors, and individuals with disabilities. Medicaid is the single largest source of health coverage in the US. States establish and administer their own Medicaid programs and determine the type, amount, duration, and scope of services within broad federal guidelines. Federal law requires states to provide certain mandatory benefits and allows states the choice of covering other optional benefits. Mandatory benefits include services like inpatient and outpatient hospital services, physician services, laboratory and x-ray services, and home health services, among others. Optional benefits include services like prescription drugs, case management, physical therapy, and occupational therapy.

In 2018, Medicaid and CHIP payments were $604 billion or 10% of our Government’s aggregate expenditures.

Eligibility and enrollment

In order to participate in Medicaid, federal law requires states to cover certain groups of individuals. Low-income families, qualified pregnant women and children, and individuals receiving Supplemental Security Income (SSI) are examples of mandatory eligibility groups. States have additional options for coverage and may choose to cover other groups, such as individuals receiving home and community-based services and children in foster care who are not otherwise eligible.

As of 2020, 37 states have expanded their Medicaid programs to cover all people with household incomes below a certain level. Whether you qualify for Medicaid coverage depends partly on whether your state has expanded its program through the Affordable Care Act.

  • In all states - You can qualify for Medicaid based on income, household size, disability, family status, and other factors. Eligibility rules differ between states.
  • In states that have expanded Medicaid coverage - You can qualify based on your income alone. If your household income is below 133% of the federal poverty level (FPL), you qualify.

Modified Adjusted Gross Income (MAGI), calculated as adjusted gross income (AGI) (gross income less adjustments as defined by the IRS at the time) plus untaxed foreign income, non-taxable Social Security benefits, and tax-exempt interest, is used to determine financial eligibility for Medicaid, CHIP, and premium tax credits and cost sharing reductions available through the health insurance marketplace. Eligibility is expressed as a percentage of the FPL and varies by state; a recipient’s MAGI must be below the stated threshold to qualify. The eligibility ranges, expressed as a percentage of the FPL (including states with expanded rates), are as follows:

Medicaid:

  • Children ages 0-1 – ranging from 139% in Utah to 375% in Iowa
  • Children ages 1-5 – ranging from 133% in Oregon to 319% in District of Columbia
  • Children ages 6-18 – ranging from 133% in 16 states to 319% in District of Columbia
  • Pregnant women – ranging from 133% in four states to 375% in Iowa
  • Adult parent/caretaker – ranging from 13% in Alabama to 216% in District of Columbia

CHIP:

  • Children from birth to age 19 with exceptions, including 15 states that don’t offer CHIP to children – ranging from 185% in Idaho to 400% in New York
  • Pregnant women – only six states offer – ranging from 200% in two states to 300% in two states

The FPL for 2020 ranges from $12,760 for individuals to $44,120 for a family of eight.

To be eligible for Medicaid, individuals must also meet certain non-financial criteria. Beneficiaries must generally be residents of the state in which they are receiving Medicaid. They must either be citizens of the US or certain qualified non-citizens, such as lawful permanent residents. In addition, some eligibility groups are limited by age, or by pregnancy or parenting status.

Applications are accepted at any time; there is no open enrollment period. Applicants may enroll electronically via https://www.healthcare.gov/ or at their local Center for Medicare and Medicaid Services or Medicaid office.

Funding and financial condition of the program

Medicaid is funded jointly by states and the federal government. Its federal funding source is among the mandatory expenditures in the annual federal budget. Congress could act to modify or remove the program’s funding, but otherwise, it will continue as scheduled. The program does not have a trust fund.

Medicaid is also funded by state funds and to a lesser degree, premiums and cost sharing. States may charge limited premiums and enrollment fees to certain groups of Medicaid enrollees with incomes above 150% of the Federal Poverty Level (FPL). States may establish cost sharing requirements for Medicaid enrollees, but allowable charges vary by income and service. In addition, children with incomes below 133% of the FPL generally cannot be charged cost sharing. Overall, premium and cost sharing amounts for family members enrolled in Medicaid may not exceed 5% of a family’s annual income. States can choose to impose limited enrollment fees, premiums, deductibles, coinsurance, and copayments for children and pregnant women enrolled in CHIP, generally limited to 5% of a family’s annual income.

Food assistance – Supplemental Nutrition Assistance Program (SNAP)

Fiscal year

1980

   

1990

   

2000

   

2010

   

2017

   

2018

   

2019

   

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total benefits (in millions)

 

$

8,721

 

 

$

14,143

 

 

$

14,983

 

 

$

64,702

 

 

$

63,711

 

 

$

60,917

 

 

$

55,622

 

 

$

74,205

Average monthly recipients (in thousands)

 

 

21,082

 

 

 

20,049

 

 

 

17,194

 

 

 

40,302

 

 

 

42,317

 

 

 

40,776

 

 

 

35,702

 

 

 

39,885

Average monthly benefits per person

 

$

34

 

 

$

59

 

 

$

73

 

 

$

134

 

 

$

125

 

 

$

125

 

 

$

130

 

 

$

153

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dollar amounts in this table may not agree to amounts for the same program in our financial statements or narrative discussion as 1) the data in this table may be on a different year (e.g. fiscal vs. calendar) basis and 2) the data in this table may be drawn from a source that prepares the data on an accrual rather than a cash basis.

†† Source: Department of Agriculture.

††† 2018 and 2019 participation and benefits totals exclude North Carolina's data.

†††† We limited the data in this table to the years presented to provide the most recent data but to also fit the table to the page. Additional years of data and more detail may be found on our website. Click “More detail” to access it.

The Supplemental Nutrition Assistance Program (SNAP) offers nutrition assistance to millions of eligible, low-income individuals and families and provides economic benefits to communities when recipients spend money on food locally. SNAP is the largest program in the domestic hunger safety net. The maximum monthly benefit for the first person in a household is $234, with the amount per additional person decreasing with each person. These maximum benefits are reduced by 30% of the net monthly income of the household, as SNAP households are expected to spend 30% of their resources on food. In 2018, SNAP payments were $61 billion or 1% of our Government’s aggregate expenditures.

Eligibility and enrollment20

SNAP benefits are available to US citizens and certain immigrants who meet certain tests, including resource, income, and employment tests.

The Food and Nutrition Service works with state agencies, nutrition educators, and neighborhood and faith-based organizations to ensure that those eligible for nutrition assistance can make informed decisions about applying for the program and can access benefits.

Resources

Households may have $2,250 in countable resources, such as a bank account, or $3,500 in countable resources if at least one person is age 60 or older or is disabled. However, certain resources are not counted, such as a home and lot, the resources of people who receive SSI, the resources of people who receive Temporary Assistance for Needy Families (TANF), and most retirement (pension) plans, as well as vehicles in certain states.

Income

Households have to meet income tests unless all members are receiving TANF, SSI, or in some places general assistance. Most households must have gross income and net income (gross income minus allowable deductions) of no more than 130% and 100% of the poverty level, respectively, except in Alaska and Hawaii, where income limits are higher. A household with a person 60 years of age or older or a person who is receiving certain types of disability payments only has to meet the net income test.

Employment

In general, people must meet work requirements in order to be eligible for SNAP. These work requirements include registering for work, not voluntarily quitting a job or reducing hours, taking a job if offered, and participating in employment and training programs, if assigned by the state. In addition, able-bodied adults without dependents are required to work or participate in a work program for at least 20 hours per week in order to receive SNAP benefits for more than three months in a 36-month period. Some special groups may not be subject to these requirements, including children, seniors, pregnant women, and people who are exempt for physical or mental-health reasons.

Immigrants

SNAP is available to most legal immigrants who meet the tests above and:

  • have lived in the US for five years; or
  • are receiving disability-related assistance or benefits; or
  • are children under 18.

Certain non-citizens, such as those admitted for humanitarian reasons and those admitted for permanent residence, may also be eligible for the program. Eligible household members can get SNAP benefits even if there are other members of the household who are not eligible. Non-citizens who are in the US temporarily, such as students, are not eligible.

Funding and financial condition of the program

SNAP is funded by mandatory expenditures in the annual federal budget. Congress could act to modify or remove the program’s funding, but otherwise, it will continue as scheduled. SNAP does not have a dedicated trust fund.

Unemployment Insurance21

Fiscal year

 

1980

   

 

1990

   

 

2000

   

 

2010

   

 

2017

   

 

2018

 

 

 

   2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regular Benefits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total # weeks claimed (in thousands)

 

 

148,952

 

 

 

115,954

 

 

 

96,007

 

 

 

203,149

 

 

 

87,582

 

 

 

79,298

 

 

 

75,958

Average weekly benefit (non-partial)

 

$

100

 

 

$

162