•Medicaid/CHIP. Medicaid provides medical assistance to needy families with dependent children and the aged, blind, and disabled who have low incomes. Beginning in 2014, states will be required to expand coverage to able-bodied individuals under age 65 with incomes below 133% of the federal poverty guidelines. A large share of Medicaid expenditures pays for nursing home care for the elderly and disabled. The State Children's Health Insurance Program (CHIP) allows states to cover targeted low-income children with no health insurance in families with income above Medicaid eligibility levels. In addition, when certain conditions are met, states may extend CHIP coverage to pregnant women and parents of Medicaid and CHIP-eligible children. In FY2011, Medicaid/CHIP outlays of $284 billion accounted for 7.9% of all federal outlays and 1.9% of GDP.
•The health insurance tax credit, created by the 2010 health care reform law,3 will help certain individuals and families purchase health insurance beginning in 2014. Under the 2010 health reform law, individuals and families not otherwise covered will be able to purchase health insurance from state-based "exchanges." Families with incomes below 400% of the poverty line will have their out-of-pocket premium payments capped at a certain percentage of their incomes.4 The remainder of the premium cost would be paid for through an advance-payable, refundable tax credit. The refundable portion of that tax credit is considered a federal outlay.
•Supplemental Nutrition Assistance Program (SNAP, the program formerly known as food stamps) provides low-income families with an income supplement to enable them to purchase a minimal cost, nutritious diet. SNAP is available to all low-income households regardless of their demographic composition, though benefits for able-bodied adults without dependents and who are not working is time-limited and certain noncitizens are excluded.5 SNAP benefits are uniform nationwide for families of a given size except in Alaska, Hawaii, and the territories. In FY2011, SNAP outlays of $78 billion accounted for 2.2% of all federal outlays and 0.5% of GDP.
•Student Financial Assistance, mostly Pell Grants, provides funds to students from low-income families to help meet the cost of post-secondary education. Awards are based on a need analysis that considers both the cost of education and financial resources of the student's family. In FY2011, outlays for student financial assistance of $38 billion accounted for 1.1% of all federal outlays and 0.3% of GDP.
•Compensatory Education (Title I-A of the Elementary and Secondary Education Act) provides aid to school districts based on their number and percentage of economically disadvantaged children. The purpose of this aid is to ensure that each child has a high-quality education and reaches, at a minimum, proficiency on state academic achievement standards and assessments under the No Child Left Behind Act. In FY2011, total outlays for compensatory education grants of $19.5 billion accounted for 0.5% of all federal outlays and 0.1% of GDP.
•Housing Assistance, as categorized for this report, includes federal outlays for project-based rental assistance and tenant-based vouchers (under the Section 8 program); other support for public housing; and housing assistance for the elderly, the disabled, and American Indians. In FY2011, housing assistance outlays of $40 billion accounted for 1.1% of all federal outlays and 0.3% of GDP.
•The Earned Income Tax Credit (EITC) represents the refundable portion of the earned income tax credit. It provides an earnings supplement for low-wage earners, with the size of the credit dependent on family type and earnings. The bulk of EITC dollars goes to families with children. Historically, the bulk of refundable EITC dollars was delivered through tax refund checks. Beginning in 2012, all "advance payments" of EITC benefits are ended, and all refundable EITC dollars will be paid through refund checks. In FY2011, EITC outlays of $56 billion accounted for 1.5% of all federal outlays and 0.4% of GDP.
•The Additional Child Tax Credit (ACTC) represents the refundable portion of the child tax credit. It assists eligible parents of children who have earned income above a certain threshold but whose tax liability is too small to fully benefit from the regular non-refundable child tax credit. It is delivered to families through refund checks when they file their taxes. In FY2011, ACTC outlays of $23 billion accounted for 0.6% of all federal outlays and 0.2% of GDP.
•Supplemental Security Income (SSI) provides a federally funded cash income floor for low-income persons or couples who are aged, blind, or disabled. Federal SSI benefits are based on uniform nationwide eligibility and benefit rules, and they are paid with federal funds. States may supplement SSI with their own funds. In FY2011, SSI outlays of $56.5 billion accounted for 1.6% of all federal outlays and 0.4% of GDP.
•Family Support, as categorized for this report, includes outlays for the Temporary Assistance for Needy Families (TANF) block grant, the Child Support Enforcement (CSE) program, and federal grants to help support state child care subsidy programs. In FY2011, family support outlays of $28.4 billion accounted for 0.8% of all federal outlays and 0.2% of GDP.