Entitlements

Entitlements

  • The Budget divides all spending into two broad categories. About 30% of federal spending is called “discretionary spending,” because the amount of spending flows from annual funding decisions by Congress’ Appropriations Committees.
  • The other 70% of the budget is called “mandatory spending,” because the amount of outlays flow from legal obligations of the federal government established in law.
  • Most mandatory spending is comprised of “entitlement” programs – such as Social Security, Medicare, and Medicaid – where eligibility formulas determine outlays.
    • Other types of mandatory spending include interest payments on the public debt, and programs where authorizing statutes mandate that the federal government “shall” make specified payments.
  • Following are links to background information on entitlements:
  • Social Security (Old-Age, Survivors and Disability Insurance)
  • Medicare [Medicare is national health insurance administered by the federal government for people 65 and over and disabled Americans. It is financed by payroll taxes, general tax revenues, premiums and copayments.]
  • Medicaid [Medicaid, financed jointly by the federal and state governments, is administered by the states. It is the major health program for low-income Americans. A large portion of Medicaid pays for long-term care for low-income elderly.]
  • Affordable Care Act Subsidies
  • Other Mandatory (Entitlement) Spending