This is the accessible text file for GAO report number GAO-12-28SP 
entitled 'The Federal Governmentís Long-Term Fiscal Outlook: Fall 2011 
Update' which was released on October 24, 2011. 

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GAO-12-28SP: 

United States Government Accountability Office: 

The Federal Government's Long-Term Fiscal Outlook: 

Fall 2011 Update: 

GAOís Long-Term Fiscal Simulations: 

Since 1992, GAO has published long-term fiscal simulations showing 
federal deficits and debt under different sets of assumptions. GAO 
developed its long-term model in response to a bipartisan request from 
members of Congress concerned about the long-term effects of fiscal 
policy. GAOís simulations provide context for consideration of policy 
options. They are not intended to suggest particular policy choices but 
rather to help facilitate a dialogue on this important issue. 

GAO regularly updates its simulations as new data become available from 
the Congressional Budget Office (CBO) and the Social Security and 
Medicare Trustees (Trustees). This update incorporates provisions of 
the Budget Control Act. As in the past, GAO shows two simulations: 

The Baseline Extended simulation follows CBOís August 2011 baseline for 
the first 10 years and then holds revenue and spending other than 
interest on the debt and large entitlement programs (Social Security, 
Medicare, and Medicaid) constant as a share of gross domestic product 
(GDP). Revenue as a share of GDP over the entire period is higher than 
the historical averages; discretionary spending is below average. 

In the Alternative simulation, expiring tax provisions other than the 
temporary Social Security payroll tax reduction are extended to 2021 
and the alternative minimum tax (AMT) exemption amount is indexed to 
inflation through 2021; revenues are then brought back to the 
historical average as a share of GDP; discretionary spending follows 
CBOís baseline for the first 10 years and thereafter gradually 
increases to the historical average. 

In both simulations, deficit reduction resulting from provisions in the 
Budget Control Act related to the Joint Select Committee on Deficit 
Reduction is applied to total annual deficits evenly from 2013 to 2021. 
It remains a constant share of GDP thereafter. 

In Baseline Extended, GAO uses the Trusteesí 2011 intermediate 
projections and CBOís June 2011 long-term projections for Medicaid 
adjusted to reflect excess cost growth consistent with the Trusteesí 
projections. In the Alternative, major health entitlement programs are 
based on the Centers for Medicare & Medicaid Services Office of the 
Actuaryís (CMS Actuary) alternative projections that assume reductions 
in Medicare physician rates do not occur as scheduled under current law 
and that certain cost containment mechanisms intended to slow the 
growth of health care cost are not sustained over the long term. We 
also show the outlook using CBOís long-term projections for Social 
Security and the major health entitlements; the results are consistent 
with our other simulations. 

Additional information on the fiscal outlook and federal debt is 
available at [hyperlink, http://www.gao.gov/special.pubs/longterm/].
For more information, contact Susan J. Irving at (202) 512-6806 or 
irvings@gao.gov or Thomas J. McCool, at (202) 512-2642 or 
mccoolt@gao.gov.

[End of section] 

The federal government's fiscal outlook has improved since GAO's last 
report, largely due to provisions in the Budget Control Act of 
2011.[Footnote 1] This Act requires at least $2.1 trillion in deficit 
reduction from 2012-2021. Nevertheless, GAO's simulations continue to 
underscore the need to address the longer-term outlook as soon as 
possible while still recognizing the current weakness in the economy 
(see fig. 1). Rising health care costs and the aging of the U.S. 
population continue to create budgetary pressure. The oldest members of 
the baby-boom generation are already eligible for early Social Security 
retirement benefits and become eligible for Medicare this year. The 
Social Security program, which historically ran large cash surpluses 
that helped reduce the need to borrow from the public to finance other 
programs, is now projected to pay more in benefits than it receives in 
tax income each year into the future. Budgetary pressure will increase 
in coming decades as more members of the baby-boom generation retire 
and become eligible for federal health programs. 

Figure 1: Debt Held by the Public under Two Fiscal Policy Simulations: 

[Refer to PDF for image: multiple line graph] 

Historical high=100 percent in 1946: 109. 

Fiscal Year: 2000; 
Baseline extended: 34.7; 
Alternative: 34.7. 

Fiscal Year: 2001; 
Baseline extended: 32.5; 
Alternative: 32.5. 	

Fiscal Year: 2002; 
Baseline extended: 33.6; 
Alternative: 33.6. 

Fiscal Year: 2003; 
Baseline extended: 35.6; 
Alternative: 35.6. 

Fiscal Year: 2004; 
Baseline extended: 36.8; 
Alternative: 36.8. 

Fiscal Year: 2005; 
Baseline extended: 36.9; 
Alternative: 36.9. 

Fiscal Year: 2006; 
Baseline extended: 36.5; 
Alternative: 36.5. 

Fiscal Year: 2007; 
Baseline extended: 36.2; 
Alternative: 36.2. 

Fiscal Year: 2008; 
Baseline extended: 40.3; 
Alternative: 40.3. 

Fiscal Year: 2009; 
Baseline extended: 53.5; 
Alternative: 53.5. 

Fiscal Year: 2010; 
Baseline extended: 62.2; 
Alternative: 62.2. 

Fiscal Year: 2011; 
Baseline extended: 67.334; 
Alternative: 67.334. 

Fiscal Year: 2012; 
Baseline extended: 71.203; 
Alternative: 71.355. 

Fiscal Year: 2013; 
Baseline extended: 72.758; 
Alternative: 74.852. 

Fiscal Year: 2014; 
Baseline extended: 71.568; 
Alternative: 76.283. 

Fiscal Year: 2015; 
Baseline extended: 68.732; 
Alternative: 75.946. 

Fiscal Year: 2016; 
Baseline extended: 67.19; 
Alternative: 76.884. 

Fiscal Year: 2017; 
Baseline extended: 65.754; 
Alternative: 77.966. 

Fiscal Year: 2018; 
Baseline extended: 64.319;	
Alternative: 79.108. 

Fiscal Year: 2019; 
Baseline extended: 63.103; 
Alternative: 80.521. 

Fiscal Year: 2020; 
Baseline extended: 62.043; 
Alternative: 82.199. 

Fiscal Year: 2021; 
Baseline extended: 61.02;	
Alternative: 84.021. 

Fiscal Year: 2022; 
Baseline extended: 60.787; 
Alternative: 86.954. 

Fiscal Year: 2023; 
Baseline extended: 60.737;	
Alternative: 90.463. 

Fiscal Year: 2024; 
Baseline extended: 61.103;	
Alternative: 94.594. 

Fiscal Year: 2025; 
Baseline extended: 61.722;	
Alternative: 99.436. 

Fiscal Year: 2026; 
Baseline extended: 62.589; 
Alternative: 104.933. 

Fiscal Year: 2027; 
Baseline extended: 63.638;	
Alternative: 110.809. 

Fiscal Year: 2028; 
Baseline extended: 64.767;	
Alternative: 117.092; 

Fiscal Year: 2029; 
Baseline extended: 66.254;	
Alternative: 123.891. 

Fiscal Year: 2030; 
Baseline extended: 67.78; 
Alternative: 131.049. 

Fiscal Year: 2031; 
Baseline extended: 69.569; 
Alternative: 138.581. 

Fiscal Year: 2032; 
Baseline extended: 71.404; 
Alternative: 146.382l. 

Fiscal Year: 2033; 
Baseline extended: 73.377; 
Alternative: 154.434. 

Fiscal Year: 2034; 
Baseline extended: 75.489; 
Alternative: 162.746. 

Fiscal Year: 2035; 
Baseline extended: 77.725; 
Alternative: 171.298. 

Fiscal Year: 2036; 
Baseline extended: 80.074; 
Alternative: 180.075. 

Fiscal Year: 2037; 
Baseline extended: 82.531; 
Alternative: 189.073. 

Fiscal Year: 2038; 
Baseline extended: 85.015; 
Alternative: 198.134. 

Fiscal Year: 2039; 
Baseline extended: 87.539; 
Alternative: 0. 

Fiscal Year: 2040; 
Alternative: 90.321; 
Alternative: 0. 

Fiscal Year: 2041; 
Baseline extended: 93.179; 
Alternative: 0. 

Fiscal Year: 2042; 
Baseline extended: 96.081; 
Alternative: 0. 

Fiscal Year: 2043; 
Baseline extended: 99.032; 
Alternative: 0. 

Fiscal Year: 2044; 
Baseline extended: 102.043; 
Alternative: 0. 

Fiscal Year: 2045; 
Baseline extended: 105.102; 
Alternative: 0. 

Fiscal Year: 2046; 
Baseline extended: 108.22; 
Alternative: 0. 

Fiscal Year: 2047; 
Baseline extended: 111.383; 
Alternative: 0. 

Fiscal Year: 2048; 
Baseline extended: 114.606; 
Alternative: 0. 

Fiscal Year: 2049; 
Baseline extended: 117.872; 
Alternative: 0. 

Fiscal Year: 2050; 
Baseline extended: 121.049; 
Alternative: 0. 

Fiscal Year: 2051; 
Baseline extended: 124.5; 
Alternative: 0. 

Fiscal Year: 2052; 
Baseline extended: 127.892; 
Alternative: 0. 

Fiscal Year: 2053; 
Baseline extended: 131.476; 
Alternative: 0. 

Fiscal Year: 2054; 
Baseline extended: 134.975; 
Alternative: 0. 

Fiscal Year: 2055; 
Baseline extended: 138.536; 
Alternative: 0. 

Fiscal Year: 2056; 
Baseline extended: 142.305; 
Alternative: 0. 

Fiscal Year: 2057; 
Baseline extended: 145.994; 
Alternative: 0. 

Fiscal Year: 2058; 
Baseline extended: 149.746; 
Alternative: 0. 

Fiscal Year: 2059; 
Baseline extended: 153.563; 
Alternative: 0. 

Source: GAO. 

Note: Data are from GAO's Fall 2011 simulations based on the Trustees' 
assumptions for Social Security and the Trustees' and the CMS Actuary's 
assumptions for Medicare. 

[End of figure] 

The timing of the debt buildup varies depending on the assumptions 
used: debt held by the public increases less rapidly in the Baseline 
Extended simulation than under the Alternative simulation. However, 
even with the improvement from the Budget Control Act, debt held by the 
public under the Alternative simulation exceeds the post-World War II 
high of 109 percent of GDP by 2027. 

The Budget Control Act set limits on discretionary spending for fiscal 
years 2012-2021 and created the Joint Select Committee on Deficit 
Reduction. Under the enacted discretionary spending limits, 
discretionary spending as a share of the economy would be lower in 2021 
than at any point in the last 40 years. The Act also provides for an 
additional $1.2 trillion in deficit reduction over the period--either 
through enactment of recommendations made by the Joint Select Committee 
or through automatic procedures that would reduce spending. Since the 
Joint Select Committee may allocate the deficit reduction between 
changes in tax and spending law as it deems appropriate, savings are 
applied to the total deficit in the simulations shown in this report. 
The simulations also assume that the savings as a share of GDP are 
maintained throughout the simulation period. To do this would require a 
sustained commitment extending beyond the time horizon and the goals 
specified in the Budget Control Act. As figure 2 shows, however, based 
on our simulations even this level of deficit reduction is not 
sufficient to ensure sustainability. 

Figure 2: Federal Budget Surpluses and Deficits under Two Fiscal Policy 
Simulations: 

[Refer to PDF for image: multiple line graph] 

Percentage of GDP: 

Fiscal Year: 2000; 
Baseline extended: 2.405%; 
Alternative: 2.405%. 

Fiscal Year: 2001; 
Baseline extended: 1.254%; 
Alternative: 1.254%. 

Fiscal Year: 2002; 
Baseline extended: -1.497%; 
Alternative: -1.497%. 

Fiscal Year: 2003; 
Baseline extended: -3.439%; 
Alternative: -3.439%. 

Fiscal Year: 2004; 
Baseline extended: -3.532%; 
Alternative: -3.532%. 

Fiscal Year: 2005; 
Baseline extended: -2.558%; 
Alternative: -2.558%. 

Fiscal Year: 2006; 
Baseline extended: -1.877%; 
Alternative: -1.877%. 

Fiscal Year: 2007; 
Baseline extended: -1.157%; 
Alternative: -1.157%. 

Fiscal Year: 2008; 
Baseline extended: -3.186%; 
Alternative: -3.186%. 

Fiscal Year: 2009; 
Baseline extended: -10.021%; 
Alternative: -10.021%. 

Fiscal Year: 2010; 
Baseline extended: -8.917%; 
Alternative: -8.917%. 

Fiscal Year: 2011; 
Baseline extended: -9.843%; 
Alternative: -9.843%. 

Fiscal Year: 2012; 
Baseline extended: -7.008%; 
Alternative: -7.14%. 

Fiscal Year: 2013; 
Baseline extended: -4.294%; 
Alternative: -6.41%. 

Fiscal Year: 2014; 
Baseline extended: -3.091%; 
Alternative: -6.421%. 

Fiscal Year: 2015; 
Baseline extended: -3.027%; 
Alternative: -6.806%. 

Fiscal Year: 2016; 
Baseline extended: -3.441%; 
Alternative: -7.523%. 

Fiscal Year: 2017; 
Baseline extended: -3.078%; 
Alternative: -7.492%. 

Fiscal Year: 2018; 
Baseline extended: -2.915%; 
Alternative: -7.666%. 

Fiscal Year: 2019; 
Baseline extended: -3.182%; 
Alternative: -8.232%. 

Fiscal Year: 2020; 
Baseline extended: -3.237%; 
Alternative: -8.635%. 

Fiscal Year: 2021; 
Baseline extended: -3.206%; 
Alternative: -8.954%. 

Fiscal Year: 2022; 
Baseline extended: -3.537%; 
Alternative: -9.63%. 

Fiscal Year: 2023; 
Baseline extended: -3.702%; 
Alternative: -10.357%. 

Fiscal Year: 2024; 
Baseline extended: -3.977%; 
Alternative: -11.115%. 

Fiscal Year: 2025; 
Baseline extended: -4.375%; 
Alternative: -11.911%. 

Fiscal Year: 2026; 
Baseline extended: -4.553%; 
Alternative: -12.513%. 

Fiscal Year: 2027; 
Baseline extended: -4.837%; 
Alternative: -13.125%. 

Fiscal Year: 2028; 
Baseline extended: -5.231%; 
Alternative: -13.851%. 

Fiscal Year: 2029; 
Baseline extended: -5.527%; 
Alternative: -14.491%. 

Fiscal Year: 2030; 
Baseline extended: -5.816%; 
Alternative: -15.131%. 

Fiscal Year: 2031; 
Baseline extended: -6.103%; 
Alternative: -15.775%. 

Fiscal Year: 2032; 
Baseline extended: -6.504%; 
Alternative: -16.422%. 

Fiscal Year: 2033; 
Baseline extended: -6.677%; 
Alternative: -17.075%. 

Fiscal Year: 2034; 
Baseline extended: -6.958%; 
Alternative: -17.735%. 

Fiscal Year: 2035; 
Baseline extended: -7.234%; 
Alternative: -18.396%. 

Fiscal Year: 2036; 
Baseline extended: -7.509%; 
Alternative: -19.063 

Fiscal Year: 2037; 
Baseline extended: -7.9%; 
Alternative: -19.849%. 

Fiscal Year: 2038; 
Baseline extended: -8.159%; 
Alternative: 0. 

Fiscal Year: 2039; 
Baseline extended: -8.413%; 
Alternative: 0. 

Fiscal Year: 2040; 
Baseline extended: -8.661%; 
Alternative: 0. 

Fiscal Year: 2041; 
Baseline extended: -8.908%; 
Alternative: 0. 

Fiscal Year: 2042; 
Baseline extended: -9.153%; 
Alternative: 0. 

Fiscal Year: 2043; 
Baseline extended: -9.398%; 
Alternative: 0. 

Fiscal Year: 2044; 
Baseline extended: -9.645%; 
Alternative: 0. 

Fiscal Year: 2045; 
Baseline extended: -9.897%; 
Alternative: 0. 

Fiscal Year: 2046; 
Baseline extended: -10.286%; 
Alternative: 0. 

Fiscal Year: 2047; 
Baseline extended: -10.547%; 
Alternative: 0. 

Fiscal Year: 2048; 
Baseline extended: -10.806%; 
Alternative: 0. 

Fiscal Year: 2049; 
Baseline extended: -11.064%; 
Alternative: 0. 

Fiscal Year: 2050; 
Baseline extended: -11.192%; 
Alternative: 0. 

Fiscal Year: 2051; 
Baseline extended: -11.597%; 
Alternative: 0. 

Fiscal Year: 2052; 
Baseline extended: -11.876%; 
Alternative: 0. 

Fiscal Year: 2053; 
Baseline extended: -12.159%; 
Alternative: 0. 

Fiscal Year: 2054; 
Baseline extended: -12.45%; 
Alternative: 0. 

Fiscal Year: 2055; 
Baseline extended: -12.752%; 
Alternative: 0. 

Fiscal Year: 2056; 
Baseline extended: -13.061%; 
Alternative: 0. 

Fiscal Year: 2057; 
Baseline extended: -13.229%; 
Alternative: 0. 

Fiscal Year: 2058; 
Baseline extended: -13.679%; 
Alternative: 0. 

Fiscal Year: 2059; 
Baseline extended: -13.993%; 
Alternative: 0. 

Fiscal Year: 2060; 
Baseline extended: -14.166%; 
Alternative: 0. 

Source: GAO. 

Notes: Data are from GAO's Fall 2011 simulations based on the Trustees' 
assumptions for Social Security and the Trustees' and CMS Actuary's 
alternative assumptions for Medicare. Discretionary spending is based 
on discretionary caps in Title I of the Budget Control Act through 
2021. Additional deficit reduction resulting from provisions related to 
the Joint Select Committee on Deficit Reduction is allocated evenly 
from 2013 to 2021 and remains a constant share of GDP thereafter. 

[End of figure] 

One of the key drivers of the federal government's long-term fiscal 
imbalance is federal health care spending, which has been growing 
faster than the overall economy. Several provisions under current law, 
including provisions in the Patient Protection and Affordable Care Act 
(PPACA)[Footnote 2] were designed to control the growth of health care 
costs. The full implementation and effectiveness of these cost-control 
provisions, which are reflected in the Baseline Extended simulation, 
would slow the growth in federal health care spending over the long 
term. Under the Baseline Extended simulation, spending on Social 
Security and major health care entitlements grows from a little less 
than 10 percent of GDP in 2010 to 13.5 percent by 2030 (see fig. 3). 

Figure 3: Spending on Social Security, Medicare, Medicaid, Children's 
Health Insurance Program (CHIP), and Exchange Subsidies under the 
Baseline Extended Simulation: 

[Refer to PDF for image: multiple line graph] 

Fiscal Year: 2010; 
Social Security: 4.8288; 
Medicaid, CHIP, and exchange subsidies: 1.934; 
Medicare: 3.07663. 

Fiscal Year: 2011; 
Social Security: 4.8068; 
Medicaid, CHIP, and exchange subsidies: 1.87516; 
Medicare: 3.15716. 

Fiscal Year: 2012; 
Social Security: 4.9074; 
Medicaid, CHIP, and exchange subsidies: 1.71654; 
Medicare: 3.00989. 

Fiscal Year: 2013; 
Social Security: 5.017; 
Medicaid, CHIP, and exchange subsidies: 1.76763; 
Medicare: 3.16465. 

Fiscal Year: 2014; 
Social Security: 5.027; 
Medicaid, CHIP, and exchange subsidies: 2.06028; 
Medicare: 3.19015. 

Fiscal Year: 2015; 
Social Security: 4.9455; 
Medicaid, CHIP, and exchange subsidies: 2.25197; 
Medicare: 3.11715. 

Fiscal Year: 2016; 
Social Security: 4.9475; 
Medicaid, CHIP, and exchange subsidies: 2.45784; 
Medicare: 3.20618. 

Fiscal Year: 2017; 
Social Security: 5; 
Medicaid, CHIP, and exchange subsidies: 2.54011; 
Medicare: 3.15909. 

Fiscal Year: 2018; 
Social Security: 5.0763; 
Medicaid, CHIP, and exchange subsidies: 2.57809; 
Medicare: 3.12244. 

Fiscal Year: 2019; 
Social Security: 5.1642; 
Medicaid, CHIP, and exchange subsidies: 2.63406; 
Medicare: 3.25378. 

Fiscal Year: 2020; 
Social Security: 5.2619; 
Medicaid, CHIP, and exchange subsidies: 2.69616; 
Medicare: 3.34525. 

Fiscal Year: 2021; 
Social Security: 5.355; 
Medicaid, CHIP, and exchange subsidies: 2.78406; 
Medicare: 3.4345. 

Fiscal Year: 2022; 
Social Security: 5.505; 
Medicaid, CHIP, and exchange subsidies: 2.95902; 
Medicare: 3.54706. 

Fiscal Year: 2023; 
Social Security: 5.605; 
Medicaid, CHIP, and exchange subsidies: 2.89965; 
Medicare: 3.65961. 

Fiscal Year: 2024; 
Social Security: 5.6975; 
Medicaid, CHIP, and exchange subsidies: 3.04965; 
Medicare: 3.77217. 

Fiscal Year: 2025; 
Social Security: 5.7875; 
Medicaid, CHIP, and exchange subsidies: 2.97502; 
Medicare: 3.88472. 

Fiscal Year: 2026; 
Social Security: 5.87; 
Medicaid, CHIP, and exchange subsidies: 3.02034; 
Medicare: 3.9836. 

Fiscal Year: 2027; 
Social Security: 5.9425; 
Medicaid, CHIP, and exchange subsidies: 3.06957; 
Medicare: 4.08172. 

Fiscal Year: 2028; 
Social Security: 6.005; 
Medicaid, CHIP, and exchange subsidies: 2.99657; 
Medicare: 4.17765. 

Fiscal Year: 2029; 
Social Security: 6.065; 
Medicaid, CHIP, and exchange subsidies: 3.14412; 
Medicare: 4.26979. 

Fiscal Year: 2030; 
Social Security: 6.11; 
Medicaid, CHIP, and exchange subsidies: 3.06888; 
Medicare: 4.35653. 

Fiscal Year: 2031; 
Social Security: 6.1425; 
Medicaid, CHIP, and exchange subsidies: 3.22336; 
Medicare: 4.43575. 

Fiscal Year: 2032; 
Social Security: 6.1725; 
Medicaid, CHIP, and exchange subsidies: 3.15069; 
Medicare: 4.50771. 

Fiscal Year: 2033; 
Social Security: 6.195; 
Medicaid, CHIP, and exchange subsidies: 3.18266; 
Medicare: 4.57445. 

Fiscal Year: 2034; 
Social Security: 6.2075; 
Medicaid, CHIP, and exchange subsidies: 3.22817; 
Medicare: 4.63742. 

Fiscal Year: 2035; 
Social Security: 6.2175; 
Medicaid, CHIP, and exchange subsidies: 3.2625; 
Medicare: 4.69789. 

Fiscal Year: 2036; 
Social Security: 6.22; 
Medicaid, CHIP, and exchange subsidies: 3.29824; 
Medicare: 4.75215. 

Fiscal Year: 2037; 
Social Security: 6.2125; 
Medicaid, CHIP, and exchange subsidies: 3.34689; 
Medicare: 4.79746. 

Fiscal Year: 2038; 
Social Security: 6.2025; 
Medicaid, CHIP, and exchange subsidies: 3.38617; 
Medicare: 4.83314. 

Fiscal Year: 2039; 
Social Security: 6.185; 
Medicaid, CHIP, and exchange subsidies: 3.41518; 
Medicare: 4.86227. 

Fiscal Year: 2040; 
Social Security: 6.165; 
Medicaid, CHIP, and exchange subsidies: 3.58173; 
Medicare: 4.88812. 

Fiscal Year: 2041; 
Social Security: 6.145; 
Medicaid, CHIP, and exchange subsidies: 3.60915; 
Medicare: 4.90946. 

Fiscal Year: 2042; 
Social Security: 6.1175; 
Medicaid, CHIP, and exchange subsidies: 3.63738; 
Medicare: 4.92666. 

Fiscal Year: 2043; 
Social Security: 6.095; 
Medicaid, CHIP, and exchange subsidies: 3.66701; 
Medicare: 4.94142. 

Fiscal Year: 2044; 
Social Security: 6.0825; 
Medicaid, CHIP, and exchange subsidies: 3.69861; 
Medicare: 4.95575. 

Fiscal Year: 2045; 
Social Security: 6.065; 
Medicaid, CHIP, and exchange subsidies: 3.72115; 
Medicare: 4.97144. 

Fiscal Year: 2046; 
Social Security: 6.045; 
Medicaid, CHIP, and exchange subsidies: 3.7562; 
Medicare: 4.9868. 

Fiscal Year: 2047; 
Social Security: 6.025; 
Medicaid, CHIP, and exchange subsidies: 3.78017; 
Medicare: 4.99928. 

Fiscal Year: 2048; 
Social Security: 6.0125; 
Medicaid, CHIP, and exchange subsidies: 3.81422; 
Medicare: 5.00896. 

Fiscal Year: 2049; 
Social Security: 5.995; 
Medicaid, CHIP, and exchange subsidies: 3.83693; 
Medicare: 5.01703. 

Fiscal Year: 2050; 
Social Security: 5.9825; 
Medicaid, CHIP, and exchange subsidies: 3.72167; 
Medicare: 5.02525. 

Fiscal Year: 2051; 
Social Security: 5.9725; 
Medicaid, CHIP, and exchange subsidies: 3.87908; 
Medicare: 5.03344. 

Fiscal Year: 2052; 
Social Security: 5.9625; 
Medicaid, CHIP, and exchange subsidies: 3.75913; 
Medicare: 5.04043. 

Fiscal Year: 2053; 
Social Security: 5.9525; 
Medicaid, CHIP, and exchange subsidies: 3.91901; 
Medicare: 5.04687. 

Fiscal Year: 2054; 
Social Security: 5.95; 
Medicaid, CHIP, and exchange subsidies: 3.79142; 
Medicare: 5.05544. 

Fiscal Year: 2055; 
Social Security: 5.95; 
Medicaid, CHIP, and exchange subsidies: 3.80646; 
Medicare: 5.06752. 

Fiscal Year: 2056; 
Social Security: 5.95; 
Medicaid, CHIP, and exchange subsidies: 3.96479; 
Medicare: 5.08128. 

Fiscal Year: 2057; 
Social Security: 5.9425; 
Medicaid, CHIP, and exchange subsidies: 3.84025; 
Medicare: 5.09406. 

Fiscal Year: 2058; 
Social Security: 5.94; 
Medicaid, CHIP, and exchange subsidies: 3.85707; 
Medicare: 5.10533. 

Fiscal Year: 2059; 
Social Security: 5.94; 
Medicaid, CHIP, and exchange subsidies: 3.87422; 
Medicare: 5.11577. 

Fiscal Year: 2060; 
Social Security: 5.9325; 
Medicaid, CHIP, and exchange subsidies: 3.88402; 
Medicare: 5.1265. 

Fiscal Year: 2061; 
Social Security: 5.93; 
Medicaid, CHIP, and exchange subsidies: 3.89561; 
Medicare: 5.13691. 

Fiscal Year: 2062; 
Social Security: 5.93; 
Medicaid, CHIP, and exchange subsidies: 3.90112; 
Medicare: 5.14669. 

Fiscal Year: 2063; 
Social Security: 5.9225; 
Medicaid, CHIP, and exchange subsidies: 3.77463; 
Medicare: 5.15631. 

Fiscal Year: 2064; 
Social Security: 5.92; 
Medicaid, CHIP, and exchange subsidies: 3.93093; 
Medicare: 5.1666. 

Fiscal Year: 2065; 
Social Security: 5.9125; 
Medicaid, CHIP, and exchange subsidies: 3.94384; 
Medicare: 5.17822. 

Fiscal Year: 2066; 
Social Security: 5.91; 
Medicaid, CHIP, and exchange subsidies: 3.81204; 
Medicare: 5.19009. 

Fiscal Year: 2067; 
Social Security: 5.91; 
Medicaid, CHIP, and exchange subsidies: 3.82026; 
Medicare: 5.20001. 

Fiscal Year: 2068; 
Social Security: 5.91; 
Medicaid, CHIP, and exchange subsidies: 3.97681; 
Medicare: 5.20815. 

Fiscal Year: 2069; 
Social Security: 5.9175; 
Medicaid, CHIP, and exchange subsidies: 3.99444; 
Medicare: 5.21566. 

Fiscal Year: 2070; 
Social Security: 5.92; 
Medicaid, CHIP, and exchange subsidies: 3.85061; 
Medicare: 5.22239. 

Fiscal Year: 2071; 
Social Security: 5.92; 
Medicaid, CHIP, and exchange subsidies: 3.85614; 
Medicare: 5.22836. 

Fiscal Year: 2072; 
Social Security: 5.92; 
Medicaid, CHIP, and exchange subsidies: 3.86297; 
Medicare: 5.23381. 

Fiscal Year: 2073; 
Social Security: 5.9275; 
Medicaid, CHIP, and exchange subsidies: 3.86489; 
Medicare: 5.23884. 

Fiscal Year: 2074; 
Social Security: 5.9375; 
Medicaid, CHIP, and exchange subsidies: 3.86858; 
Medicare: 5.24087. 

Fiscal Year: 2075; 
Social Security: 5.94; 
Medicaid, CHIP, and exchange subsidies: 4.02328; 
Medicare: 5.24089. 

Fiscal Year: 2076; 
Social Security: 5.94; 
Medicaid, CHIP, and exchange subsidies: 4.0243; 
Medicare: 5.24102. 

Fiscal Year: 2077; 
Social Security: 5.9475; 
Medicaid, CHIP, and exchange subsidies: 4.02619; 
Medicare: 5.24049. 

Fiscal Year: 2078; 
Social Security: 5.9575; 
Medicaid, CHIP, and exchange subsidies: 3.88523; 
Medicare: 5.23859. 

Fiscal Year: 2079; 
Social Security: 5.96; 
Medicaid, CHIP, and exchange subsidies: 3.88834; 
Medicare: 5.23513. 

Fiscal Year: 2080; 
Social Security: 5.9675; 
Medicaid, CHIP, and exchange subsidies: 3.89226; 
Medicare: 5.23092. 

Fiscal Year: 2081; 
Social Security: 5.9775; 
Medicaid, CHIP, and exchange subsidies: 4.04701; 
Medicare: 5.22646. 

Fiscal Year: 2082; 
Social Security: 5.98; 
Medicaid, CHIP, and exchange subsidies: 4.04792; 
Medicare: 5.22177. 

Fiscal Year: 2083; 
Social Security: 5.9875; 
Medicaid, CHIP, and exchange subsidies: 4.05534; 
Medicare: 5.21669. 

Fiscal Year: 2084; 
Social Security: 5.9975; 
Medicaid, CHIP, and exchange subsidies: 4.0534; 
Medicare: 5.21096. 
	
Fiscal Year: 2085; 
Social Security: 6.0075; 
Medicaid, CHIP, and exchange subsidies: 4.0534; 
Medicare: 5.20484. 

Source: GAO. 

Note: Social Security and Medicare projections are based on CBO's 
August 2011 baseline through 2021 and the Trustees' 2011 intermediate 
assumptions thereafter. Projections for Medicaid, the Children's Health 
Insurance Program (CHIP), and state health insurance exchange subsidies 
are based on CBO's short-term estimates (from August 2011) and long-
term projections (from June 2011) of outlays for those programs, 
adjusted to reflect excess cost growth consistent with the 2011 
Trustees intermediate assumptions. This figure does not take into 
account any changes to these programs that may result from the 
provisions in the Budget Control Act related to the Joint Select 
Committee on Deficit Reduction. 

[End of figure] 

However, the Trustees, CBO, and the CMS Actuary have expressed concerns 
about the effective implementation of certain cost-control measures 
over the long term. For example, they have noted that reductions in 
physician payment rates scheduled to occur under current law have 
routinely been overridden. They have also questioned whether a 
provision in PPACA that would restrain spending growth by reducing the 
payment rates for certain Medicare services based on productivity gains 
observed throughout the economy is sustainable over the long term. 
These concerns are reflected in our Alternative simulation, which, 
consistent with CBO's and CMS Actuary's alternative projections, 
assumes the Medicare physician rate reductions do not occur and that 
certain cost-containment mechanisms intended to slow the growth of 
health care costs are not sustained over the long term. As figure 4 
shows, spending on health care grows much more rapidly under this more 
pessimistic set of assumptions, putting pressure on the rest of the 
federal budget. Absent changes to these programs, spending on Social 
Security and major health care entitlements under the Alternative 
simulation grows to 14.5 percent of GDP by 2030. 

Figure 4: Spending on Social Security, Medicare, Medicaid, CHIP, and 
Exchange Subsidies under the Alternative Simulation: 

[Refer to PDF for image: multiple line graph] 

Fiscal Year: 2010; 
Social Security: 4.8288; 
Medicaid, CHIP, and exchange subsidies: 1.934; 
Medicare: 3.07663. 

Fiscal Year: 2011; 
Social Security: 4.8068; 
Medicaid, CHIP, and exchange subsidies: 1.87516; 
Medicare: 3.10259. 

Fiscal Year: 2012; 
Social Security: 4.9074; 
Medicaid, CHIP, and exchange subsidies: 1.71654; 
Medicare: 3.07533. 

Fiscal Year: 2013; 
Social Security: 5.017; 
Medicaid, CHIP, and exchange subsidies: 1.76763; 
Medicare: 3.28413. 

Fiscal Year: 2014; 
Social Security: 5.027; 
Medicaid, CHIP, and exchange subsidies: 2.06028; 
Medicare: 3.31293. 

Fiscal Year: 2015; 
Social Security: 4.9455; 
Medicaid, CHIP, and exchange subsidies: 2.25197; 
Medicare: 3.24098. 

Fiscal Year: 2016; 
Social Security: 4.9475; 
Medicaid, CHIP, and exchange subsidies: 2.45784; 
Medicare: 3.3426. 

Fiscal Year: 2017; 
Social Security: 5; 
Medicaid, CHIP, and exchange subsidies: 2.54011; 
Medicare: 3.30641. 

Fiscal Year: 2018; 
Social Security: 5.0763; 
Medicaid, CHIP, and exchange subsidies: 2.57809; 
Medicare: 3.28192. 

Fiscal Year: 2019; 
Social Security: 5.1642; 
Medicaid, CHIP, and exchange subsidies: 2.63406; 
Medicare: 3.43609. 

Fiscal Year: 2020; 
Social Security: 5.2619; 
Medicaid, CHIP, and exchange subsidies: 2.69616; 
Medicare: 3.54262. 

Fiscal Year: 2021; 
Social Security: 5.355; 
Medicaid, CHIP, and exchange subsidies: 2.78406; 
Medicare: 3.64578. 

Fiscal Year: 2022; 
Social Security: 5.505; 
Medicaid, CHIP, and exchange subsidies: 2.96255; 
Medicare: 3.79217. 

Fiscal Year: 2023; 
Social Security: 5.605; 
Medicaid, CHIP, and exchange subsidies: 3.00988; 
Medicare: 3.93857. 

Fiscal Year: 2024; 
Social Security: 5.6975; 
Medicaid, CHIP, and exchange subsidies: 3.05959; 
Medicare: 4.08496. 

Fiscal Year: 2025; 
Social Security: 5.7875; 
Medicaid, CHIP, and exchange subsidies: 3.09479; 
Medicare: 4.23136. 

Fiscal Year: 2026; 
Social Security: 5.87; 
Medicaid, CHIP, and exchange subsidies: 3.14576; 
Medicare: 4.541. 

Fiscal Year: 2027; 
Social Security: 5.9425; 
Medicaid, CHIP, and exchange subsidies: 3.2009; 
Medicare: 4.67555. 

Fiscal Year: 2028; 
Social Security: 6.005; 
Medicaid, CHIP, and exchange subsidies: 3.24407; 
Medicare: 4.80907. 

Fiscal Year: 2029; 
Social Security: 6.065; 
Medicaid, CHIP, and exchange subsidies: 3.28572; 
Medicare: 4.93974. 

Fiscal Year: 2030; 
Social Security: 6.11; 
Medicaid, CHIP, and exchange subsidies: 3.3299; 
Medicare: 5.06467. 

Fiscal Year: 2031; 
Social Security: 6.1425; 
Medicaid, CHIP, and exchange subsidies: 3.3775; 
Medicare: 5.1847. 

Fiscal Year: 2032; 
Social Security: 6.1725; 
Medicaid, CHIP, and exchange subsidies: 3.42838; 
Medicare: 5.30285. 

Fiscal Year: 2033; 
Social Security: 6.195; 
Medicaid, CHIP, and exchange subsidies: 3.46723; 
Medicare: 5.42125. 

Fiscal Year: 2034; 
Social Security: 6.2075; 
Medicaid, CHIP, and exchange subsidies: 3.52091; 
Medicare: 5.54099. 

Fiscal Year: 2035; 
Social Security: 6.2175; 
Medicaid, CHIP, and exchange subsidies: 3.56258; 
Medicare: 5.65324. 

Fiscal Year: 2036; 
Social Security: 6.22; 
Medicaid, CHIP, and exchange subsidies: 3.60571; 
Medicare: 5.75466. 

Fiscal Year: 2037; 
Social Security: 6.2125; 
Medicaid, CHIP, and exchange subsidies: 3.66249; 
Medicare: 5.84523. 

Fiscal Year: 2038; 
Social Security: 6.2025; 
Medicaid, CHIP, and exchange subsidies: 3.70895; 
Medicare: 5.92959. 

Fiscal Year: 2039; 
Social Security: 6.185; 
Medicaid, CHIP, and exchange subsidies: 3.74412; 
Medicare: 6.01171. 

Fiscal Year: 2040; 
Social Security: 6.165; 
Medicaid, CHIP, and exchange subsidies: 3.92028; 
Medicare: 6.08885. 

Fiscal Year: 2041; 
Social Security: 6.145; 
Medicaid, CHIP, and exchange subsidies: 3.9536; 
Medicare: 6.1614. 

Fiscal Year: 2042; 
Social Security: 6.1175; 
Medicaid, CHIP, and exchange subsidies: 3.98815; 
Medicare: 6.23175. 

Fiscal Year: 2043; 
Social Security: 6.095; 
Medicaid, CHIP, and exchange subsidies: 4.02439; 
Medicare: 6.30245. 

Fiscal Year: 2044; 
Social Security: 6.0825; 
Medicaid, CHIP, and exchange subsidies: 4.06298; 
Medicare: 6.37589. 

Fiscal Year: 2045; 
Social Security: 6.065; 
Medicaid, CHIP, and exchange subsidies: 4.09129; 
Medicare: 6.44921. 

Fiscal Year: 2046; 
Social Security: 6.045; 
Medicaid, CHIP, and exchange subsidies: 4.13261; 
Medicare: 6.51863. 

Fiscal Year: 2047; 
Social Security: 6.025; 
Medicaid, CHIP, and exchange subsidies: 4.16119; 
Medicare: 6.58455. 

Fiscal Year: 2048; 
Social Security: 6.0125; 
Medicaid, CHIP, and exchange subsidies: 4.20092; 
Medicare: 6.64886. 

Fiscal Year: 2049; 
Social Security: 5.995; 
Medicaid, CHIP, and exchange subsidies: 4.22849; 
Medicare: 6.71413. 

Fiscal Year: 2050; 
Social Security: 5.9825; 
Medicaid, CHIP, and exchange subsidies: 4.25599; 
Medicare: 6.77978. 

Fiscal Year: 2051; 
Social Security: 5.9725; 
Medicaid, CHIP, and exchange subsidies: 4.2807; 
Medicare: 6.84388. 

Fiscal Year: 2052; 
Social Security: 5.9625; 
Medicaid, CHIP, and exchange subsidies: 4.30554; 
Medicare: 6.90763. 

Fiscal Year: 2053; 
Social Security: 5.9525; 
Medicaid, CHIP, and exchange subsidies: 4.33219; 
Medicare: 6.97489. 

Fiscal Year: 2054; 
Social Security: 5.95; 
Medicaid, CHIP, and exchange subsidies: 4.35062; 
Medicare: 7.04763. 

Fiscal Year: 2055; 
Social Security: 5.95; 
Medicaid, CHIP, and exchange subsidies: 4.37188; 
Medicare: 7.12278. 

Fiscal Year: 2056; 
Social Security: 5.95; 
Medicaid, CHIP, and exchange subsidies: 4.39442; 
Medicare: 7.1964. 

Fiscal Year: 2057; 
Social Security: 5.9425; 
Medicaid, CHIP, and exchange subsidies: 4.41695; 
Medicare: 7.26818. 

Fiscal Year: 2058; 
Social Security: 5.94; 
Medicaid, CHIP, and exchange subsidies: 4.43949; 
Medicare: 7.3393. 

Fiscal Year: 2059; 
Social Security: 5.94; 
Medicaid, CHIP, and exchange subsidies: 4.46293; 
Medicare: 7.41155. 

Fiscal Year: 2060; 
Social Security: 5.9325; 
Medicaid, CHIP, and exchange subsidies: 4.47822; 
Medicare: 7.48375. 

Fiscal Year: 2061; 
Social Security: 5.93; 
Medicaid, CHIP, and exchange subsidies: 4.49569; 
Medicare: 7.55536. 

Fiscal Year: 2062; 
Social Security: 5.93; 
Medicaid, CHIP, and exchange subsidies: 4.50614; 
Medicare: 7.62729. 

Fiscal Year: 2063; 
Social Security: 5.9225; 
Medicaid, CHIP, and exchange subsidies: 4.5318; 
Medicare: 7.7007. 

Fiscal Year: 2064; 
Social Security: 5.92; 
Medicaid, CHIP, and exchange subsidies: 4.54881; 
Medicare: 7.77673. 

Fiscal Year: 2065; 
Social Security: 5.9125; 
Medicaid, CHIP, and exchange subsidies: 4.5676; 
Medicare: 7.85333. 

Fiscal Year: 2066; 
Social Security: 5.91; 
Medicaid, CHIP, and exchange subsidies: 4.58813; 
Medicare: 7.92676. 

Fiscal Year: 2067; 
Social Security: 5.91; 
Medicaid, CHIP, and exchange subsidies: 4.6011; 
Medicare: 7.99774. 

Fiscal Year: 2068; 
Social Security: 5.91; 
Medicaid, CHIP, and exchange subsidies: 4.61518; 
Medicare: 8.06827. 

Fiscal Year: 2069; 
Social Security: 5.9175; 
Medicaid, CHIP, and exchange subsidies: 4.63862; 
Medicare: 8.13772. 

Fiscal Year: 2070; 
Social Security: 5.92; 
Medicaid, CHIP, and exchange subsidies: 4.64678; 
Medicare: 8.20615. 

Fiscal Year: 2071; 
Social Security: 5.92; 
Medicaid, CHIP, and exchange subsidies: 4.65664; 
Medicare: 8.27404. 

Fiscal Year: 2072; 
Social Security: 5.92; 
Medicaid, CHIP, and exchange subsidies: 4.66811; 
Medicare: 8.34154. 

Fiscal Year: 2073; 
Social Security: 5.9275; 
Medicaid, CHIP, and exchange subsidies: 4.67359; 
Medicare: 8.4037. 

Fiscal Year: 2074; 
Social Security: 5.9375; 
Medicaid, CHIP, and exchange subsidies: 4.68121; 
Medicare: 8.46291. 

Fiscal Year: 2075; 
Social Security: 5.94; 
Medicaid, CHIP, and exchange subsidies: 4.84728; 
Medicare: 8.52323. 

Fiscal Year: 2076; 
Social Security: 5.94; 
Medicaid, CHIP, and exchange subsidies: 4.85097; 
Medicare: 8.58231. 

Fiscal Year: 2077; 
Social Security: 5.9475; 
Medicaid, CHIP, and exchange subsidies: 4.85558; 
Medicare: 8.63882. 

Fiscal Year: 2078; 
Social Security: 5.9575; 
Medicaid, CHIP, and exchange subsidies: 4.86826; 
Medicare: 8.69253. 

Fiscal Year: 2079; 
Social Security: 5.96; 
Medicaid, CHIP, and exchange subsidies: 4.87465; 
Medicare: 8.74517. 

Fiscal Year: 2080; 
Social Security: 5.9675; 
Medicaid, CHIP, and exchange subsidies: 4.88221; 
Medicare: 8.79758. 

Fiscal Year: 2081; 
Social Security: 5.9775; 
Medicaid, CHIP, and exchange subsidies: 4.89115; 
Medicare: 8.84966. 

Fiscal Year: 2082; 
Social Security: 5.98; 
Medicaid, CHIP, and exchange subsidies: 4.89496; 
Medicare: 8.90103. 

Fiscal Year: 2083; 
Social Security: 5.9875; 
Medicaid, CHIP, and exchange subsidies: 4.90663; 
Medicare: 8.95112. 

Fiscal Year: 2084; 
Social Security: 5.9975; 
Medicaid, CHIP, and exchange subsidies: 4.90669; 
Medicare: 9.00045. 

Fiscal Year: 2085; 
Social Security: 6.0075; 
Medicaid, CHIP, and exchange subsidies: 4.90669; 
Medicare: 8.99156; 

Source: GAO. 

Note: Projections for Social Security are based on CBO's August 2011 
baseline through 2021 and the Trustees' 2011 intermediate assumptions 
thereafter. Projections for Medicare are based on the CMS Actuary's 
alternative assumptions. Projections for Medicaid, the Children's 
Health Insurance Program (CHIP), and state health insurance exchange 
subsidies are based on CBO's short-term estimates (from August 2011) 
and long-term projections (from June 2011) of outlays for those 
programs, adjusted to reflect excess cost growth consistent with the 
2011 Trustees intermediate assumptions. This figure does not take into 
account any changes to these programs that may result from the 
provisions in the Budget Control Act related to the Joint Select 
Committee on Deficit Reduction. 

[End of figure] 

Concluding Observations: 

The United States recently suffered from the most severe recession 
since the end of World War II. The economic downturn along with the 
federal government's response to it and other actions taken to 
stabilize financial markets contributed to a rapid buildup in federal 
debt held by the public--increasing from roughly 36 percent of GDP at 
the end of 2007 to roughly 62 percent at the end of 2010--adding to the 
size and urgency of the federal government's long-term fiscal 
challenge. Our simulations show that the Budget Control Act of 2011 
will help reduce deficits. However, the longer-term fiscal challenge 
remains. The Joint Select Committee has the opportunity to improve the 
federal budget outlook by making changes to the structural imbalance 
between revenues and spending. Addressing the long-term fiscal 
challenge will not be easy. It will likely require difficult decisions 
affecting both federal spending and revenue. The challenge is made 
greater by the need to balance the fragile economic recovery with the 
need to act soon to change the path. 

Changes since the Last Update: 

Our long-term federal budget simulations were updated to incorporate 
the most recent estimates for Social Security and Medicare spending 
that were released in May 2011 and CBO's most recent budget and 
economic projections that were released in August 2011.[Footnote 3] We 
also include information from CBO's Long-Term Budget Outlook that was 
released in June 2011. 

CBO's recent budget estimates reflect the effects of the Budget Control 
Act of 2011, which enacted caps on discretionary spending for fiscal 
years 2012-2021. The Act also created the Joint Select Committee on 
Deficit Reduction and tasked it with proposing legislation that would 
reduce the deficit by $1.5 trillion over the period. The Act specifies 
that the Joint Select Committee vote on a report no later than November 
23, 2011. If legislation based on the committee's proposals fails to 
reduce the deficit by at least $1.2 trillion, automatic procedures will 
reduce federal spending by the amount needed to reach this goal. 
Consistent with CBO's baseline, we reduce the total deficit in each 
simulation by the same amount from 2013 to 2021. We make no assumptions 
about the allocation between spending and revenues and so do not change 
the spending and revenue paths; rather, as CBO does, we apply the 
savings to the deficit. After 2021, we hold the amount of deficit 
reduction constant as a share of GDP in both simulations. 

We also changed our method and assumptions for GDP growth in our 
simulations. Previously, GDP in our model was determined by growth in 
the labor force, capital stock, and total factor productivity after the 
first 10 years, and projections of Social Security spending were 
adjusted accordingly. Beginning with this update, our GDP growth 
assumption matches the Trustees' intermediate assumptions over the long 
term. This GDP growth assumption is more consistent with the growth in 
labor force, wages, and other factors underlying the Trustees' Social 
Security and Medicare estimates used in our simulations. 

Key Assumptions in Our Federal Simulations: 

Table 1 lists the key assumptions incorporated in the Baseline Extended 
and Alternative simulations for the simulations based on the Trustees' 
assumptions. 

Table 1: Assumptions for Baseline Extended and Alternative Simulations 
Based on the Trustees' Assumptions for Social Security and Medicare: 

Model inputs: Revenue; 
Baseline Extended: CBO's August 2011 baseline through 2021; thereafter 
remains constant at 20.9 percent of GDP (CBO's projection in 2021); 
Alternative: CBO's estimates assuming expiring tax provisions other 
than the temporary Social Security payroll tax reduction are extended 
through 2021 and the 2011 alternative minimum tax (AMT) exemption 
amount is indexed to inflation for years 2012-2021; 
thereafter is phased into the 40-year historical average of 18.0 
percent of GDP. 

Model inputs: Social Security spending; 
CBO's August 2011 baseline through 2021; thereafter based on 2011 
Social Security Trustees' intermediate projections; 
Alternative: Same as Baseline Extended. 

Model inputs: Medicare spending; 
Baseline Extended: CBO's August 2011 baseline through 2021 that assumes 
cuts in physician payment rates will occur as scheduled under current 
law; thereafter 2011 Medicare Trustees' intermediate projections; 
Alternative: Based on CMS Actuary's alternative scenario that assumes 
that physician payment rates grow with inflation (using the Medicare 
Economic Index [MEI])[A] and other policies that would restrain 
spending growth begin to phase out after 2019. 

Model inputs: Medicaid, CHIP, and exchange subsidies; spending; 
Baseline Extended: CBO's August 2011 baseline through 2021; thereafter 
CBO's June 2011 long-term projections adjusted to reflect excess cost 
growth consistent with the 2011 Medicare Trustees' intermediate 
projections; 
Alternative: CBO's August 2011 baseline through 2021; thereafter CBO's 
June 2011 long-term projections adjusted to reflect excess cost growth 
consistent with CMS Actuary's alternative scenario and CBO's 
alternative assumption that a policy that would slow the growth of 
subsidies for health insurance coverage is not in effect. 

Model inputs: Other mandatory spending; 
Baseline Extended: CBO's August 2011 baseline through 2021; thereafter 
remains constant as a share of GDP at 2.2 percent of GDP (implied by 
CBO's projection in 2021); 
Alternative: Baseline Extended adjusted for extension of certain tax 
credits through 2021; thereafter is phased back to 2.2 percent of GDP 
by 2025 (same as Baseline Extended). 

Model inputs: Discretionary spending; 
Baseline Extended: CBO's August 2011 baseline through 2021, which is 
based on discretionary caps in Title I of the Budget Control Act; 
thereafter remains constant at 6.1 percent of GDP (CBO's projection in 
2021); 
Alternative: Same as Baseline Extended through 2021; thereafter 
gradually phases into 7.5 percent (the 20-year historical average). 

Model inputs: Additional deficit reduction related to the Budget 
Control Act[B]; 
Baseline Extended: Follows CBO's August 2011 baseline through 2021, 
which applies savings evenly from 2013-2021; does not allocate savings 
to revenue, discretionary or mandatory spending; thereafter deficit 
reduction held constant as a share of GDP; 
Alternative: Same as Baseline Extended. 

Source: GAO. 

Notes: CBO's projections are from The Budget and Economic Outlook: An 
Update (August 2011) and CBO's 2011 Long-Term Budget Outlook (June 
2011). Trustees' projections are from The 2011 Annual Report of the 
Board of Trustees of the Federal Old-Age and Survivors Insurance and 
Federal Disability Insurance Trust Funds and The 2011 Annual Report of 
the Boards of Trustees of the Federal Hospital Insurance and Federal 
Supplementary Medical Insurance Trust Funds, which were both issued on 
May 13, 2011. Projections from the CMS Actuary are based on "Projected 
Medicare Expenditures under an Illustrative Scenario with Alternative 
Payment Updates to Medicare Providers" (May 13, 2011). We assume that 
Social Security and Medicare benefits are paid in full regardless of 
the amounts available in the trust funds. 

[A] Since 2003, Congress took a series of legislative actions to 
prevent reductions in physician payment rates that would otherwise 
occur under law. Physician fee updates set by Congress have averaged 
1.0 percent per year over this period. Growth in MEI is projected to 
average 1.9 percent from 2012 to 2020. Thus, the assumption used by CMS 
implies physician payment rates will grow almost two times faster than 
they have since 2003. 

[B] The Budget Control Act created the Joint Select Committee on 
Deficit Reduction and tasked it with proposing reductions that will 
amount to at least $1.5 trillion in budgetary savings over 10 years. If 
legislation based on the committee's proposals fails to reduce the 
deficit by at least $1.2 trillion, automatic procedures will reduce 
federal spending by the amount needed to reach this goal. Additional 
deficit reduction in our simulations is based on the latter amount--the 
amount tied to enforcement. 

[End of table] 

Table 2 shows the key economic assumptions that underlie all of our 
simulations. GDP is held constant across simulations and does not 
respond to changes in fiscal policy. Also, the interest rate on federal 
debt held by the public in our simulations is held constant over the 
long term even when deficits climb. With large budget deficits, there 
could be a rise in the rate of interest and a more rapid increase in 
federal interest payments than our simulations display. 

Table 2: Key Economic Assumptions Underlying All of GAO's Long-Term 
Federal Simulations: 

Model inputs: GDP growth; 
All simulations: CBO's August 2011 baseline through 2021; thereafter 
averages 2.1 percent based on the intermediate assumptions of the 2011 
Social Security and Medicare Trustees Reports. 

Model inputs: Inflation (percentage change in GDP price index); 
All simulations: CBO's August 2011 baseline through 2021; 2.0 percent 
thereafter (CBO's projection in 2021). 

Model inputs: Interest rate (on publicly held debt); 
All simulations: Rate implied by CBO's August 2011 baseline net 
interest payment projections through 2021; 5.2 percent thereafter 
(based on CBO's June 2011 long-term projection). 

Source: GAO. 

[End of table] 

A more detailed description of the federal model and key assumptions 
can be found at [hyperlink, 
http://www.gao.gov/special.pubs/longterm/fed/aboutlongterm.html]. 

The simulation results depend largely on what is assumed about growth 
in large entitlement programs. As in previous updates, we also show the 
Baseline Extended simulation using both Trustees and CBO estimates for 
long-term spending on Social Security and major health entitlement 
programs (Medicare, Medicaid, and others). In addition, we show the 
Alternative simulation using different assumptions about certain health 
care cost-containment provisions based on CBO and CMS Actuary 
alternative projections. As figure 5 shows, the results under either 
set of assumptions are unsustainable. 

Figure 6: Debt Held by the Public under Two Fiscal Policy Simulations 
with Different Assumptions for Major Entitlement Programs: 

[Refer to PDF for image: multiple line graph] 

Fiscal Year: 2000; 
Baseline: Trustees intermediate Social Security and Medicare: 34.7; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 34.7; 
Baseline: CBO Social Security and baseline health: 34.7; 
Alternative: CBO Social Security and alternative health: 34.7. 

Fiscal Year: 2001; 
Baseline: Trustees intermediate Social Security and Medicare: 32.5; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 32.5; 
Baseline: CBO Social Security and baseline health: 32.5; 
Alternative: CBO Social Security and alternative health: 32.5. 

Fiscal Year: 2002; 
Baseline: Trustees intermediate Social Security and Medicare: 33.6; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 33.6; 
Baseline: CBO Social Security and baseline health: 33.6; 
Alternative: CBO Social Security and alternative health: 33.6. 

Fiscal Year: 2003; 
Baseline: Trustees intermediate Social Security and Medicare: 35.6; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 35.6; 
Baseline: CBO Social Security and baseline health: 35.6; 
Alternative: CBO Social Security and alternative health: 35.6. 

Fiscal Year: 2004; 
Baseline: Trustees intermediate Social Security and Medicare: 36.8; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 36.8; 
Baseline: CBO Social Security and baseline health: 36.8; 
Alternative: CBO Social Security and alternative health: 36.8. 

Fiscal Year: 2005; 
Baseline: Trustees intermediate Social Security and Medicare: 36.9; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 36.9; 
Baseline: CBO Social Security and baseline health: 36.9; 
Alternative: CBO Social Security and alternative health: 36.9. 

Fiscal Year: 2006; 
Baseline: Trustees intermediate Social Security and Medicare: 36.5; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 36.5; 
Baseline: CBO Social Security and baseline health: 36.5; 
Alternative: CBO Social Security and alternative health: 36.5. 

Fiscal Year: 2007; 
Baseline: Trustees intermediate Social Security and Medicare: 36.2; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 36.2; 
Baseline: CBO Social Security and baseline health: 36.2; 
Alternative: CBO Social Security and alternative health: 36.2. 

Fiscal Year: 2008; 
Baseline: Trustees intermediate Social Security and Medicare: 40.3; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 40.3; 
Baseline: CBO Social Security and baseline health: 40.3; 
Alternative: CBO Social Security and alternative health: 40.3. 

Fiscal Year: 2009; 
Baseline: Trustees intermediate Social Security and Medicare: 53.5; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 53.5; 
Baseline: CBO Social Security and baseline health: 53.5; 
Alternative: CBO Social Security and alternative health: 53.5. 

Fiscal Year: 2010; 
Baseline: Trustees intermediate Social Security and Medicare: 62.2; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 62.2; 
Baseline: CBO Social Security and baseline health: 62.2; 
Alternative: CBO Social Security and alternative health: 62.2. 

Fiscal Year: 2011; 
Baseline: Trustees intermediate Social Security and Medicare: 67.334; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 67.334; 
Baseline: CBO Social Security and baseline health: 67.334; 
Alternative: CBO Social Security and alternative health: 67.334. 

Fiscal Year: 2012; 
Baseline: Trustees intermediate Social Security and Medicare: 71.203; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 71.355; 
Baseline: CBO Social Security and baseline health: 71.203; 
Alternative: CBO Social Security and alternative health: 71.355. 

Fiscal Year: 2013; 
Baseline: Trustees intermediate Social Security and Medicare: 72.758; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 74.852; 
Baseline: CBO Social Security and baseline health: 72.758; 
Alternative: CBO Social Security and alternative health: 74.852. 

Fiscal Year: 2014; 
Baseline: Trustees intermediate Social Security and Medicare: 71.568; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 76.283; 
Baseline: CBO Social Security and baseline health: 71.568; 
Alternative: CBO Social Security and alternative health: 76.283. 

Fiscal Year: 2015; 
Baseline: Trustees intermediate Social Security and Medicare: 68.732; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 75.946; 
Baseline: CBO Social Security and baseline health: 68.732; 
Alternative: CBO Social Security and alternative health: 75.946. 

Fiscal Year: 2016; 
Baseline: Trustees intermediate Social Security and Medicare: 67.19; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 76.884; 
Baseline: CBO Social Security and baseline health: 67.19; 
Alternative: CBO Social Security and alternative health: 76.884. 

Fiscal Year: 2017; 
Baseline: Trustees intermediate Social Security and Medicare: 65.754; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 77.966; 
Baseline: CBO Social Security and baseline health: 65.754; 
Alternative: CBO Social Security and alternative health: 77.966. 

Fiscal Year: 2018; 
Baseline: Trustees intermediate Social Security and Medicare: 64.319; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 79.108; 
Baseline: CBO Social Security and baseline health: 64.319; 
Alternative: CBO Social Security and alternative health: 79.108. 

Fiscal Year: 2019; 
Baseline: Trustees intermediate Social Security and Medicare: 63.103; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 80.521; 
Baseline: CBO Social Security and baseline health: 63.103; 
Alternative: CBO Social Security and alternative health: 80.521. 

Fiscal Year: 2020; 
Baseline: Trustees intermediate Social Security and Medicare: 62.043; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 82.199; 
Baseline: CBO Social Security and baseline health: 62.043; 
Alternative: CBO Social Security and alternative health: 82.199. 

Fiscal Year: 2021; 
Baseline: Trustees intermediate Social Security and Medicare: 61.02; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 84.021; 
Baseline: CBO Social Security and baseline health: 61.02; 
Alternative: CBO Social Security and alternative health: 84.021. 

Fiscal Year: 2022; 
Baseline: Trustees intermediate Social Security and Medicare: 60.787; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 86.954; 
Baseline: CBO Social Security and baseline health: 60.676; 
Alternative: CBO Social Security and alternative health: 86.829. 

Fiscal Year: 2023; 
Baseline: Trustees intermediate Social Security and Medicare: 60.737; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 90.463; 
Baseline: CBO Social Security and baseline health: 60.461; 
Alternative: CBO Social Security and alternative health: 90.206. 

Fiscal Year: 2024; 
Baseline: Trustees intermediate Social Security and Medicare: 61.103; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 94.594; 
Baseline: CBO Social Security and baseline health: 60.606; 
Alternative: CBO Social Security and alternative health: 94.104. 

Fiscal Year: 2025; 
Baseline: Trustees intermediate Social Security and Medicare: 61.722; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 99.436; 
Baseline: CBO Social Security and baseline health: 61.072; 
Alternative: CBO Social Security and alternative health: 98.828. 

Fiscal Year: 2026; 
Baseline: Trustees intermediate Social Security and Medicare: 62.589; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 104.933; 
Baseline: CBO Social Security and baseline health: 61.759; 
Alternative: CBO Social Security and alternative health: 103.862. 

Fiscal Year: 2027; 
Baseline: Trustees intermediate Social Security and Medicare: 63.638; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 110.809; 
Baseline: CBO Social Security and baseline health: 62.707; 
Alternative: CBO Social Security and alternative health: 109.309. 

Fiscal Year: 2028; 
Baseline: Trustees intermediate Social Security and Medicare: 64.767; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 117.092; 
Baseline: CBO Social Security and baseline health: 63.748; 
Alternative: CBO Social Security and alternative health: 115.32. 

Fiscal Year: 2029; 
Baseline: Trustees intermediate Social Security and Medicare: 66.254; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 123.891; 
Baseline: CBO Social Security and baseline health: 65.046; 
Alternative: CBO Social Security and alternative health: 121.811. 

Fiscal Year: 2030; 
Baseline: Trustees intermediate Social Security and Medicare: 67.78; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 131.049; 
Baseline: CBO Social Security and baseline health: 66.624; 
Alternative: CBO Social Security and alternative health: 128.845. 

Fiscal Year: 2031; 
Baseline: Trustees intermediate Social Security and Medicare: 69.569; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 138.581; 
Baseline: CBO Social Security and baseline health: 68.401; 
136.052. 

Fiscal Year: 2032; 
Baseline: Trustees intermediate Social Security and Medicare: 71.404; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 146.382; 
Baseline: CBO Social Security and baseline health: 70.394; 
Alternative: CBO Social Security and alternative health: 143.626.
 
Fiscal Year: 2033; 
Baseline: Trustees intermediate Social Security and Medicare: 73.377; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 154.434; 
Baseline: CBO Social Security and baseline health: 72.606; 
Alternative: CBO Social Security and alternative health: 151.669. 

Fiscal Year: 2034; 
Baseline: Trustees intermediate Social Security and Medicare: 75.489; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 162.746; 
Baseline: CBO Social Security and baseline health: 74.938; 
Alternative: CBO Social Security and alternative health: 159.886. 

Fiscal Year: 2035; 
Baseline: Trustees intermediate Social Security and Medicare: 77.725; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 171.298; 
Baseline: CBO Social Security and baseline health: 77.591; 
Alternative: CBO Social Security and alternative health: 168.379. 

Fiscal Year: 2036; 
Baseline: Trustees intermediate Social Security and Medicare: 80.074; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 180.075; 
Baseline: CBO Social Security and baseline health: 80.369; 
Alternative: CBO Social Security and alternative health: 177.049. 

Fiscal Year: 2037; 
Baseline: Trustees intermediate Social Security and Medicare: 82.531; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 189.073; 
Baseline: CBO Social Security and baseline health: 83.472; 
Alternative: CBO Social Security and alternative health: 186.099. 

Fiscal Year: 2038; 
Baseline: Trustees intermediate Social Security and Medicare: 85.015; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 198.134; 
Baseline: CBO Social Security and baseline health: 86.541; 
195.194. 

Fiscal Year: 2039; 
Baseline: Trustees intermediate Social Security and Medicare: 87.539; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 89.816; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2040; 
Baseline: Trustees intermediate Social Security and Medicare: 90.321; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 93.283	
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2041; 
Baseline: Trustees intermediate Social Security and Medicare: 93.179; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 96.905; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2042; 
Baseline: Trustees intermediate Social Security and Medicare: 96.081; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 100.759; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2043; 
Baseline: Trustees intermediate Social Security and Medicare: 99.032; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 104.65	
Alternative: CBO Social Security and alternative health: 0. 	

Fiscal Year: 2044; 
Baseline: Trustees intermediate Social Security and Medicare: 102.043; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 108.675; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2045; 
Baseline: Trustees intermediate Social Security and Medicare: 105.102; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 112.838; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2046; 
Baseline: Trustees intermediate Social Security and Medicare: 108.22; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 117.239; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2047; 
Baseline: Trustees intermediate Social Security and Medicare: 111.383; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 121.78; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2048; 
Baseline: Trustees intermediate Social Security and Medicare: 114.606; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 126.563; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2049; 
Baseline: Trustees intermediate Social Security and Medicare: 117.872; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare:0; 
Baseline: CBO Social Security and baseline health: 131.489; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2050; 
Baseline: Trustees intermediate Social Security and Medicare: 121.049; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 136.461; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2051; 
Baseline: Trustees intermediate Social Security and Medicare: 124.5; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 141.78; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2052; 
Baseline: Trustees intermediate Social Security and Medicare: 127.892; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 147.386; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2053; 
Baseline: Trustees intermediate Social Security and Medicare: 131.476; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 153.25; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2054; 
Baseline: Trustees intermediate Social Security and Medicare: 134.975; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 159.373; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2055; 
Baseline: Trustees intermediate Social Security and Medicare: 138.536; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 165.658; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2056; 
Baseline: Trustees intermediate Social Security and Medicare: 142.305; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 172.107; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2057; 
Baseline: Trustees intermediate Social Security and Medicare: 145.994; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 178.721; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2058; 
Baseline: Trustees intermediate Social Security and Medicare: 149.746; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 185.603; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2059; 
Baseline: Trustees intermediate Social Security and Medicare: 153.563; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 192.754; 
Alternative: CBO Social Security and alternative health: 0. 

Fiscal Year: 2060; 
Baseline: Trustees intermediate Social Security and Medicare: 157.432; 
Alternative: Trustees Social Security and CMS Actuary alternative 
Medicare: 0; 
Baseline: CBO Social Security and baseline health: 200.079; 
Alternative: CBO Social Security and alternative health: 0. 

Source: GAO. 

[End of figure] 

Table 3 shows the CBO assumptions incorporated into the simulations 
that were used in the comparison shown in figure 5. 

Table 3: Key Assumptions Underlying GAO's Simulations Using CBO's 
Spending Projections for Major Entitlement Programs: 

Model inputs: Social Security; spending; 
Baseline Extended: CBO's August 2011 baseline through 2021; thereafter 
based on CBO's June 2011 long-term projections for Social Security; 
Alternative: Same as Baseline Extended. 

Model inputs: Medicare; spending; 
Baseline Extended: CBO's August 2011 baseline through 2021; thereafter 
based on CBO's June 2011 long-term projections under its extended-
baseline scenario; 
Alternative: Based on CBO's projections under its alternative fiscal 
scenario that assume physician payment rates are maintained at 2011 
levels through 2021 and that policies to restrain growth are not in 
effect after 2021. 

Model inputs: Medicaid, the Children's Health Insurance Program, and 
exchange subsidies; spending; 
Baseline Extended: CBO's August 2011 baseline through 2021; thereafter 
based on CBO's June 2011 long-term projections under its extended-
baseline scenario; 
Alternative: CBO's August 2011 baseline through 2021; thereafter CBO's 
June 2011 projections under its alternative fiscal scenario in which a 
policy that would slow the growth of per-participant subsidies for 
health insurance coverage is assumed not to be in effect and 
eligibility thresholds are assumed to be modified to maintain the share 
of the population eligible for subsidies. 

Source: GAO. 

Notes: CBO's projections are from CBO's 2011 Long-Term Budget Outlook 
(June 2011). CBO assumes that full benefits are paid regardless of the 
amounts available in the trust funds. 

[End of table] 

This product is part of a body of work on federal debt and the long-
term fiscal challenge. Related products can be found at [hyperlink, 
http://www.gao.gov/special.pubs/longterm/past/]. 

We conducted our work from August 2011 to October 2011 in accordance 
with all sections of GAO's Quality Assurance Framework that are 
relevant to our objectives. The framework requires that we plan and 
perform the engagement to obtain sufficient and appropriate evidence to 
meet our stated objectives and to discuss any limitations in our work. 
We believe that the information and data obtained, and the analysis 
conducted, provide a reasonable basis for any findings and conclusions. 

(450928): 

[End of section] 

Footnotes: 

[1] GAO, The Federal Government's Long-Term Fiscal Outlook: January 
2011 Update ([http://www.gao.gov/products/GAO-11-451SP], Mar. 18, 2011) 

[2] Pub. L. No. 111-148, 124 Stat. 119 (Mar. 23, 2010), as amended by 
Health Care and Education Reconciliation Act of 2010, Pub. L. No. 111-
152, 124 Stat. 1029 (Mar. 30, 2010). 

[3] These reports are available at [hyperlink, http://www.ssa.gov], 
[hyperlink, http://www.cms.gov], and [hyperlink, http://www.cbo.gov]. 

[End of section] 

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