Social Security: Another 20 percent of the budget, or $707 billion, paid for Social Security, which provided retirement benefits averaging $1,175 per month to 34.6 million retired workers in December 2010. Social Security also provided benefits to 2.9 million spouses and children of retired workers, 6.4 million surviving children and spouses of deceased workers, and 10.2 million disabled workers and their eligible dependents in December 2010.
Medicare, Medicaid, and CHIP: Three health insurance programs — Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP) — together accounted for 21 percent of the budget in 2010, or $732 billion. Nearly two-thirds of this amount, or $452 billion, went to Medicare, which provides health coverage to around 47 million people who are over the age of 65 or have disabilities. The remainder of this category funds Medicaid and CHIP, which in a typical month in 2010 will provide health care or long-term care to about 60 million low-income children, parents, elderly people, and people with disabilities. Both Medicaid and CHIP require matching payments from the states.