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Medicaid - Public health insurance program
that provides coverage for low-income
persons for acute and long-term care. It is
financed jointly by state and federal funds
(the federal government pays at least 50
percent of the total cost in each state) and is
administered by states within broad federal
guidelines.

Medicare - Federal health insurance
program for virtually all persons age 65 and
older, and permanently disabled persons
under age 65, who qualify by receiving
Social Security Disability Insurance.

Mortgage-Backed Securities (MBSs) -
Securities issued by financial institutions to
investors with the payments of interest and
principal backed by the payments on a
package of mortgages. MBSs are structured
by their sponsors to create multiple classes
of claims, or tranches, of different seniority,
based on the cash flows from the underlying
mortgages. Investors holding securities in
the safest, or most senior, tranche stand first
in line to receive payments from borrowers
and require the lowest contractual interest
rate of all the tranches. Investors holding the
least senior securities stand last in line to
receive payments, after all more senior
claims have been paid. Hence, they are first
in line to absorb losses on the underlying
mortgages. In return for assuming that risk,
holders of the least senior tranche require
the highest contractual interest rate of all the
tranches.

National Commission on Fiscal
Responsibility and Reform - A bipartisan
commission created by President Obama to
address the nation's fiscal challenges. The
Commission is charged with identifying
policies to improve the fiscal situation in the
medium term and to achieve fiscal
sustainability over the long run. Specifically,
the Commission shall propose
recommendations designed to balance the
budget, excluding interest payments on the
debt, by 2015. In addition, the Commission
shall propose recommendations that
meaningfully improve the long-run fiscal
outlook, including changes to address the
growth of entitlement spending and the gap
between the projected revenues and
expenditures of the Federal Government.

Net Interest - In the federal budget, net
interest comprises the government's interest
payments on debt held by the public (as
recorded in budget function 900), offset by
interest income that the government
receives on loans and cash balances and by
earnings of the National Railroad Retirement
Investment Trust. See budget function and
debt.

Office of Management and Budget (OMB)
- White House office responsible for
devising and submitting the president's
annual budget proposal to Congress.

Organization for Economic Co-operation
and Development (OECD) - An
international organization of 31 developed
and emerging countries (see list on slide
354) with a shared commitment to
democracy and the market economy.

Other Post-Employment Benefits (OPEB)
- An accounting concept created by the
Governmental Accounting Standards Board
(GASB) by pronouncements designed to
address expenses that entities may or may
not be legally bound to pay, but pay as a
moral obligation (such as retirees'
healthcare costs).

Pay-As-You-Go (PAYGO) - Procedures
established in House and Senate rules that
are intended to ensure that laws that affect
direct spending or revenues are budget
neutral. The Senate and the House have
had such rules in place since 1993 and
2007, respectively.

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