2011 Technical Panel on Assumptions and Methods: Report to the Social Security Advisory Board

The 2011 Technical Panel on Assumptions and Methods was convened by the Social Security Advisory Board in September 2010 to review the assumptions specified by the Board of Trustees and to evaluate the methods used by the Office of the Chief Actuary to project the future financial status of the Old-Age and Survivors Insurance and Disability Insurance Trust Funds. As noted by the 2007 Technical Panel, “The Social Security actuaries and the Trustees of the Old Age, Survivors, and Disability Insurance (OASDI) Trust Funds have perhaps the most difficult analytical task in government – projecting demographic and economic developments over the next 75 years.” We appreciate the enormity of the task and note that much of what is done in this process is fundamentally sound. We have focused on identifying areas where change might be warranted as well as on articulating the justifications for such proposed changes. As part of the process, we have examined the assumptions adopted by the Trustees in the 2010 and 2011 Trustees Reports, along with changes to the Trustees’ assumptions since issuance of the last Technical Panel report in 2007. We have also assessed the status of recommendations made by earlier Technical Panels. In cases where the 2011 Technical Panel concurs with earlier Technical Panel recommendations, we have so noted in our report. Following the 2007 Technical Panel, we begin with an assessment of the methods used to evaluate the financial status of the OASDI Trust Funds and to communicate those results to the government, the media, and the public. This includes a section on the implications of health care reform for the financial status of the OASDI program. We then turn to the key demographic and economic assumptions.