[Congressional Record (Bound Edition), Volume 159 (2013), Part 2]
[House]
[Pages 2863-2866]
[From the U.S. Government Publishing Office, www.gpo.gov]




                   PUBLICATION OF BUDGETARY MATERIAL

  Mr. RYAN of Wisconsin. Mr. Speaker, at the beginning of this 
Congress, two additional requirements for the consideration of a 
concurrent resolution on the budget resolution were set forth in 
Section 3(e) of House Resolution 5 (113th Congress).
  The first requires the concurrent resolution on the budget include a 
section related to means-tested and nonmeans-tested direct spending 
programs. The second requires a statement from the Chair of the 
Committee on the Budget defining those terms to be included in the 
Congressional Record prior to the consideration of such concurrent 
resolution on the budget. Amendments to, and conference reports on, the 
concurrent resolution must also fulfill these provisions.
  Enclosed please find two tables prepared in order to fulfill the 
terms of section 3(e) referred to above. I have also included a 
communication and associated tables from the Director of the 
Congressional Budget Office, with whom I have consulted in the 
preparation of this material.
  Attached is a description of programs considered to be means-tested 
direct spending and nonmeans-tested direct spending. While the 
nonmeans-tested list is not exhaustive, all programs not considered 
means-tested can be considered nonmeans-tested direct spending.

       Attachment.

                                      Congressional Budget Office,


                                                U.S. Congress,

                                    Washington, DC, March 5, 2013.
     Hon. Paul Ryan,
     Chairman, Committee on the Budget, House of Representatives, 
         Washington DC.
       Dear Mr. Chairman: As you requested, enclosed are two 
     tables that show federal spending and average annual growth 
     rates for the federal government's major mandatory spending 
     programs that are primarily means-tested (that is, programs 
     and tax credits that provide cash payments or assistance in 
     obtaining health care, food, or education to people with 
     relatively low income or few assets). Table 1 shows CBO's 
     baseline projections for the 2013-2023 period; Table 2 shows 
     historical spending data from 2003 through 2012, along with 
     CBO's estimates for 2013.
       Those means-tested programs include all of the mandatory 
     programs that were highlighted in CBO's recent report on 
     means-tested spending, Growth in Means-Tested Programs and 
     Tax Credits for Low-Income Households (February 2013). In 
     addition we have included some smaller mandatory means-tested 
     programs that were not discussed in that report: the 
     Children's Health Insurance Program (CHIP), veterans' 
     pensions, foster care payments, and additional programs in 
     the family support category.
       The tables do not include data on mandatory programs that 
     are mostly not means-tested, but that have components that 
     are means-tested (for example, student loans and some 
     portions of Medicare, other than low-income subsidies for 
     Part D.) They also do not include means-tested programs that 
     are discretionary (for example, the Section 8 housing 
     assistance programs and the Low Income Home Energy Assistance 
     Program).
       In CBO's latest baseline projections, published in The 
     Budget and Economic Outlook: Fiscal Years 2013 to 2023 
     (February 2013), total mandatory spending (excluding 
     offsetting receipts) is projected to grow at an average 
     annual rate of 5.6 percent over the 2014-2023 period. In 
     those projections, the means-tested programs identified in 
     the enclosed tables grow more rapidly than the programs that 
     are not means-tested--by 6.2 percent, as compared with 5.3 
     percent (see Table 1).
       Overall, the growth rates projected for the coming decade 
     are slower than those experienced in the past 10 years--by 
     about one-half percent per year, on average. Over the 2004-
     2013 period, CBO estimates that total mandatory outlays will 
     have increased at an average annual rate of 6.1 percent--
     means-tested programs by an average of 6.7 percent per year 
     and non-means-tested programs by 5.9 percent per year (see 
     Table 2).

[[Page 2864]]

       A number of programs shown in Tables 1 and 2 have been or 
     are scheduled to be significantly affected by changes in law, 
     the recent recession, and the continuing recovery. As a 
     result, important aspects of the programs in the future may 
     differ significantly from historical experience, and those 
     differences may be the source of some of the variation 
     between the growth rates in the past 10 years and those in 
     the coming decade. For example, spending for Medicaid, CHIP, 
     health insurance subsidies, the Supplemental Nutrition 
     Assistance Program (SNAP), and the refundable portions of the 
     earned income and child tax credits has been or will be 
     significantly affected by program changes that unfold over 
     time:
       The difference in growth rates for Medicaid in the two 
     periods stems in part from policy changes that reduced those 
     rates for the past decade (when they averaged 5.1 percent) 
     but will increase them in the coming decade (when they are 
     projected to average 8.0 percent). For example, in 2006, 
     Medicaid spending contracted when spending for prescription 
     drugs for certain people was shifted to the new Medicare Part 
     D program. Projected rates of growth in Medicaid spending 
     over the coming decade are elevated, reflecting the expansion 
     of Medicaid coverage under the Affordable Care Act. CBO 
     expects growth to average about 11 percent per year over the 
     2014-2017 period, as the expansion is phased in, and then to 
     level off at a steady-state rate of about 6 percent per year 
     from 2018 through 2023.
       The difference in growth rates between the two periods for 
     CHIP (8.1 percent over the 2004-2013 period vs. -5.0 percent 
     over the 2014-2023 period) reflects the sunset of CHIP's 
     existing authority at the end of fiscal year 2015. Consistent 
     with statutory guidelines, CBO assumes in its baseline 
     spending projections that funding for the program after 2015 
     will continue at $5.7 billion, which is a significant 
     reduction from the amount available at the start of the 2014-
     2023 period.
       Payments of health insurance subsidies under the Affordable 
     Care Act are scheduled to begin in 2014, and the high rates 
     of growth beginning in that year reflect a startup period for 
     the new program. In the current projection, the number of 
     people gaining coverage through the exchanges rises from 7 
     million in 2014 to 24 million in 2016. CBO projects that, 
     after the initial startup, annual growth will average about 5 
     percent from 2018 through 2023.
       SNAP spending increased markedly during the recent 
     recession--particularly in 2009 and 2010--as more people 
     became eligible for those benefits. In addition, provisions 
     in the American Recovery and Reinvestment Act of 2009 (ARRA) 
     raised the maximum benefit under that program; those 
     provisions expire in October 2013. In addition, CBO expects 
     that SNAP caseloads will eventually fall as the economy 
     continues to improve.
       The outlay portions of the earned income and child tax 
     credits are expected to dip after 2018 because provisions 
     expanding the refundability of those credits (which were 
     originally enacted in ARRA and were recently extended) are 
     scheduled to expire on December 31, 2017.
       Finally, because of the unique budgetary treatment of the 
     Pell Grant program--which has both mandatory and 
     discretionary components--the growth rates for the mandatory 
     portions of that program give incomplete information. The 
     bulk of the funding for Pell grants is discretionary and is 
     provided annually in appropriation acts. In recent years, 
     spending for Pell grants also has included two mandatory 
     components that have allowed the discretionary budget 
     authority provided by the regular appropriation acts to 
     remain well below the full cost of the program.
       In keeping with procedures that govern CBO's baseline 
     projections, the projection for the discretionary portion of 
     the Pell Grant program is based on the budget authority 
     appropriated for fiscal year 2013, adjusted for inflation. 
     (Discretionary spending for the program is shown as a 
     memorandum item in both tables.) Thus, the baseline 
     projection for both discretionary and mandatory spending for 
     Pell grants does not represent an estimate of the expected 
     future costs of the program; such a projection also would 
     take into account such factors as changes in eligibility and 
     enrollment.
       I hope that you find this information helpful. If you have 
     any further questions, please contact me or my staff. The 
     primary staff contact is Barry Blom, who can be reached at 
     226-2880.
           Sincerely,
                                             Douglas W. Elmendorf,
                                                         Director.
       Enclosure.

                                                                   TABLE 1--MANDATORY OUTLAYS IN CBO'S FEBRUARY 2013 BASELINE
                                                                        [Outlays by fiscal year, in billions of dollars]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                       Average
                                                                                                                                                                                        Annual
                                          2013         2014         2015         2016         2017         2018         2019         2020         2021         2022         2023     Growth 2014-
                                                                                                                                                                                         2023
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Means-Tested Outlays:
    Health Care Programs:
        Medicaid....................          265          297          331          372          399          422          449          476          505          536          572         8.0%
        Medicare Part D Low-Income             23           25           28           33           34           34           41           45           49           58           60        10.0%
         Subsidies..................
        Health insurance subsidies,             1           21           42           74           95          106          111          115          122          128          134       22.9%a
         exchanges, and related
         spending...................
        Children's Health Insurance             9           13           14            8            6            6            6            6            6            6            6        -5.0%
         Program....................
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
            Subtotal................          299          356          416          487          533          569          606          642          683          727          772         9.9%
    Income Security:
        SNAP........................           82           80           79           79           78           76           75           74           73           73           73        -1.2%
        Supplemental Security Income           53           55           56           63           59           56           63           64           66           74           70         2.8%
        Earned income and child tax            80           83           84           83           83           84           73           74           75           77           78        -0.3%
         credits....................
        Family supportb.............           25           25           25           25           25           25           25           25           25           25           25         0.2%
        Child nutrition.............           21           22           22           23           24           25           26           27           28           29           30         4.0%
        Foster care.................            7            7            7            7            7            7            8            8            8            8            8         2.0%
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
            Subtotal................          268          271          273          280          277          273          269          272          276          286          285         0.6%
    Veterans' Pensions:                         5            6            6            7            7            7            7            7            8            8            8         3.9%
    Pell Grants:c                              18           12            7            7            9           11           11           11           11           11           11        -4.9%
            Subtotal, Means-Tested            590          644          701          781          826          859          893          932          977        1,032        1,075         6.2%
             Programs...............
Non-Means-Tested Programsd..........        1,730        1,770        1,859        1,984        2,071        2,163        2,304        2,437        2,584        2,779        2,911         5.3%
                Total Mandatory             2,321        2,414        2,560        2,765        2,897        3,022        3,197        3,369        3,561        3,812        3,986         5.6%
                 Outlays............
Memorandum
Pell Grants (Discretionary)e........           15           23           30           24           24           25           25           26           26           27           27         6.2%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Congressional Budget Office.
Notes: The projections shown here are the same as those reported in Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2013 to 2023 (February 2013). Some of the
  projections differ from those reported in Congressional Budget Office, Growth in Means-Tested Programs and Tax Credits for Low-Income Households (February 2013). For an explanation of those
  differences, see the footnotes in Table A-2 of that report.
The average annual growth rate over the 2014-2023 period encompasses growth in outlays from the amount projected for 2013 to the amount projected for 2023.
Projections on spending for benefit programs in this table exclude administrative costs that are classified as discretionary but generally include administrative costs classified as mandatory.
SNAP = Supplemental Nutrition Assistance Program.
aBecause payments of the health insurance subsidies do not begin until 2014, the average growth rate reported here reflects the average increase from the amount projected for 2014 to the
  amount projected for 2023.
bIncludes Temporary Assistance for Needy Families and various programs that involve payments to states for child support enforcement and family support, child care entitlements, and research
  to benefit children.
cIncludes mandatory spending designed to reduce the discretionary budget authority needed to support the maximum award level set in the appropriation act plus mandatory spending that, by
  formula, increases the total maximum award above the amount set in the appropriation act.
dDoes not include offsetting receipts.
eThe discretionary baseline does not represent projection of expected costs for the discretionary portion of the Pell Grant program. As with all other discretionary programs, the budget
  authority is calculated by inflating the budget authority appropriated for fiscal year 2013. Outlays for future years are based on those amounts of budget authority and also reflect a
  temporary surplus of budget authority provided in 2013.


                                                                              TABLE 2--MANDATORY OUTLAYS SINCE 2003
                                                                        [Outlays by fiscal year, in billions of dollars]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                       Average
                                                                                                                                                                         Projected,     Annual
                                          2003         2004         2005         2006         2007         2008         2009         2010         2011         2012         2013        Growth
                                                                                                                                                                                      2004-2013
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Means-Tested Programs:
    Health Care Programs:
        Medicaid....................          161          176          182          181          191          201          251          273          275          251          265         5.1%
        Medicare Part D Low-Income              0            0            0           11           17           17           19           21           26           20           23       10.9%a
         Subsidies..................

[[Page 2865]]

 
        Health insurance subsidies,             0            0            0            0            0            0            0            *            *            *            1         n.a.
         exchanges, and related
         spending...................
        Children's Health Insurance             4            5            5            5            6            7            8            8            9            9            9         8.1%
         Program....................
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
            Subtotal................          165          181          187          197          213          225          277          302          310          280          299         6.1%
    Income Security:
        SNAP........................           25           29           33           35           35           39           56           70           77           80           82        12.5%
        Supplemental Security Income           33           34           38           37           36           41           45           47           53           47           53         5.0%
        Earned income and child tax            38           42           49           52           54           75           67           77           78           77           80         7.7%
         credits....................
        Family support b............           26           24           24           24           24           25           26           28           26           24           25        -0.8%
        Child nutrition.............           12           12           13           14           14           15           16           17           18           19           21         5.4%
        Foster care.................            6            6            6            6            7            7            7            7            7            7            7         1.3%
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
            Subtotal................          141          147          164          168          170          202          217          247          260          254          268         6.6%
    Veterans' Pensions:                         3            3            4            4            3            4            4            4            5            5            5         5.1%
    Pell Grants:c                               0            0            0            0            0            1            2            4           14           12           18         n.a.
            Subtotal, Means-Tested            309          331          354          369          386          431          501          558          589          550          590         6.7%
             Programs...............
Non-Means-Tested Programsd..........          974        1,015        1,095        1,187        1,242        1,349        1,783        1,539        1,631        1,690        1,730         5.9%
                Total Mandatory             1,283        1,347        1,449        1,556        1,628        1,780        2,284        2,097        2,220        2,240        2,321         6.1%
                 Outlays............
Memorandum:
Pell Grants (Discretionary).........           12           13           13           13           13           15           13           20           21           21           15         2.2%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Congressional Budget Office.
Notes: The average annual growth rate over the 2004-2013 period encompasses growth in outlays from the amount recorded in 2003 through the amount projected for 2013.
Data on spending for benefit programs in this table exclude administrative costs that are classified as discretionary but generally include administrative costs classified as mandatory.
SNAP = Supplemental Nutrition Assistance Program; n.a. = not applicable.
* = between zero and $500 million.
aThe average annual growth rate reflects the program's growth from its inception in 2006 through 2013.
bIncludes Temporary Assistance for Needy Families and various programs that involve payments to states for child support enforcement and family support, child care entitlements, and research
  to benefit children.
cIncludes mandatory spending designed to reduce the discretionary budget authority needed to support the maximum award level set in the appropriation act plus mandatory spending that, by
  formula, increases the total maximum award above the amount set in the appropriation act.
dDoes not include offsetting receipts.


                                                                   TABLE 1--MANDATORY OUTLAYS IN CBO'S FEBRUARY 2013 BASELINE
                                                                        [Outlays by fiscal year, in billions of dollars]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                       Average
                                                                                                                                                                                        Annual
                                          2013         2014         2015         2016         2017         2018         2019         2020         2021         2022         2023     Growth 2014-
                                                                                                                                                                                         2023
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Means-Tested Outlays:
    Health Care Programs:
        Medicaid....................          265          297          331          372          399          422          449          476          505          536          572         8.0%
        Medicare Part D Low-Income             23           25           28           33           34           34           41           45           49           58           60        10.0%
         Subsidies..................
        Health insurance subsidies,             1           21           42           74           95          106          111          115          122          128          134       22.9%a
         exchanges, and related
         spending...................
        Children's Health Insurance             9           13           14            8            6            6            6            6            6            6            6        -5.0%
         Program....................
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
            Subtotal................          299          356          416          487          533          569          606          642          683          727          772         9.9%
    Income Security:
        SNAP........................           82           80           79           79           78           76           75           74           73           73           73        -1.2%
        Supplemental Security Income           53           55           56           63           59           56           63           64           66           74           70         2.8%
        Earned income and child tax            80           83           84           83           83           84           73           74           75           77           78        -0.3%
         credits....................
        Family supportb.............           17           25           25           25           25           25           25           25           25           25           25         0.2%
        Child nutrition.............           21           22           22           23           24           25           26           27           28           29           30         4.0%
        Foster care.................            7            7            7            7            7            7            8            8            8            8            8         2.0%
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
            Subtotal................          268          271          273          280          277          273          269          272          276          286          285         0.6%
    Veterans' Pensions:                         5            6            6            7            7            7            7            7            8            8            8         3.9%
    Pell Grantsc                               18           12            7            7            9           11           11           11           11           11           11        -4.9%
            Subtotal, Means-Tested            590          644          701          781          826          859          893          932          977        1,032        1,075         6.2%
             Programs...............
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
Non-Means-Tested Programsd..........        1,730        1,770        1,859        1,984        2,071        2,163        2,304        2,437        2,584        2,779        2,911         5.3%
        Social Security
        Medicare Eligible Retiree
         Health Care Fund
        Medicare (excluding Medicare
         Part D Subsidy)
        Federal Civilian and
         Military Retirement
         Programs
        Veterans Programs (excluding
         Veterans' pensions)
        Agriculture programs
        Troubled Asset Relief
         Program
        Deposit Insurance
        All other mandatory programs
         not included in the means-
         tested list above..........
                Total Mandatory             2,321        2,414        2,560        2,765        2,897        3,022        3,197        3,369        3,561        3,812        3,986         5.6%
                 Outlays............
Memorandum
Pell Grants (Discretionary)e........           15           23           30           24           24           25           25           26           26           27           27         6.2%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source, Congressional Budget Office.
Notes: The projections shown here are the same as those reported in Congressional Budget Office, The Budget and Economic Outlook Fiscal Years 2013 to 2023 (February 2013). Some of the
  projections differ from those reported in Congressional Budget Office, Growth in Means-Tested Programs and Tax Credits for Low-Income Households (February 2013). For an explanation of those
  differences, see the footnotes in Table A-2 of that report.
The average annual growth rate over the 2014-2023 period encompasses growth in outlays from the amount projected for 2013 to the amount projected for 2023.
Projections on spending for benefit programs in this table exclude administrative costs that are classified as discretionary but generally include administrative costs classified as mandatory.
SNAP = Supplemental Nutrition Assistance Program.
aBecause payments of the health insurance subsidies do not begin until 2014, the average growth rate reported here reflects the average increase from the amount projected for 2014 to the
  amount projected for 2023.
bIncludes Temporary Assistance for Needy Families and various programs that involve payments to states for child support enforcement and family support, child care entitlements, and research
  to benefit children.
cIncludes mandatory spending designed to reduce the discretionary budget authority needed to support the maximum award level set in the appropriation act plus mandatory spending that, by
  formula, increases the total maximum award above the amount set in the appropriation act.
dDoes not include offsetting receipts. List provided by House Budget Committee based on CBO's most recent Budget and Economic Outlook.
eThe discretionary baseline does not represent a projection of expected costs for the discretionary portion of the Pell Grant program. As with all other discretionary programs, the budget
  authority is calculated by inflating the budget authority appropriated for fiscal year 2013. Outlays for future years are based on those amounts of budget authority and also reflect a
  temporary surplus of budget authority provided in 2013.


[[Page 2866]]


                                                                              TABLE 2--MANDATORY OUTLAYS SINCE 2003
                                                                        [Outlays by fiscal year, in billions of dollars]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                       Average
                                                                                                                                                                         Projected,     Annual
                                          2003         2004         2005         2006         2007         2008         2009         2010         2011         2012         2013     Growth 2004-
                                                                                                                                                                                         2013
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Means-Tested Programs:
    Health Care Programs:
        Medicaid....................          161          176          182          181          191          201          251          273          275          251          265         5.1%
        Medicare Part D Low-Income              0            0            0           11           17           17           19           21           26           20           23       10.9%a
         Subsidies..................
        Health insurance subsidies,             0            0            0            0            0            0            0            *            *            *            1         n.a.
         exchanges, and related
         spending...................
        Children's Health Insurance             4            5            5            5            6            7            8            8            9            9            9         8.1%
         Program....................
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
            Subtotal................          165          181          187          197          213          225          277          302          310          280          299         6.1%
    Income Security:
        SNAP                                   25           29           33           35           35           39           56           70           77           80           82        12.5%
        Supplemental Security Income           33           34           38           37           36           41           45           47           53           47           53         5.0%
        Earned income and child tax            38           42           49           52           54           75           67           77           78           77           80         7.7%
         credits....................
        Family supportb.............           26           24           24           24           24           25           26           28           26           24           25        -0.8%
        Child nutrition.............           12           12           13           14           14           15           16           17           18           19           21         5.4%
        Foster care.................            6            6            6            6            7            7            7            7            7            7            7         1.3%
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
            Subtotal................          141          147          164          168          170          202          217          247          260          254          268         6.6%
    Veterans' Pensions                          3            3            4            4            3            4            4            4            5            5            5         5.1%
    Pell Grantsc                                0            0            0            0            0            1            2            4           14           12           18         n.a.
            Subtotal, Means-Tested            309          331          354          369          386          431          501          558          589          550          590         6.7%
             Programs...............
                                     -----------------------------------------------------------------------------------------------------------------------------------------------
Non-Means-Tested Programsd..........          974        1,015        1,095        1,187        1,242        1,349        1,783        1,539        1,631        1,690        1,730         5.9%
        Social Security
        Medicare Eligible Retiree
         Health Care Fund
        Medicare (excluding Medicare
         Part D Subsidy)
        Federal Civilian and
         Military Retirement
         Programs
        Veterans Programs (excluding
         Veterans' pensions)
        Agriculture programs
        Troubled Asset Relief
         Program
        Deposit Insurance
        All other mandatory programs
         not included in the means-
         tested list above
                Total Mandatory             1,283        1,347        1,449        1,556        1,628        1,780        2,284        2,097        2,220        2,240        2,321         6.1%
                 Outlays............
Memorandum
Pell Grants (Discretionary).........           12           13           13           13           13           15           13           20           21           21           15         2.2%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Congressional Budget Office.
Notes: The average annual growth rate over the 2004-2013 period encompasses growth in outlays from the amount recorded in 2003 through the amount projected for 2013.
Data on spending for benefit programs in this table exclude administrative costs that are classified as discretionary but generally include administrative costs classified as mandatory.
SNAP = Supplemental Nutrition Assistance Program; n.a. = not applicable.
** = between zero and $500 million.
aThe average annual growth rate reflects the program's growth from its inception in 2006 through 2013.
bIncludes Temporary Assistance for Needy Families and various programs that involve payments to states for child support enforcement and family support, child care entitlements, and research
  to benefit children.
cIncludes mandatory spending designed to reduce the discretionary budget authority needed to support the maximum award level set in the appropriation act plus mandatory spending that, by
  formula, increases the total maximum award above the amount set in the appropriation act.
dDoes not include offsetting receipts. List provided by House Budget Committee based on CBO's most recent Budget and Economic Outlook




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