After a half-year of work, the commission has agreed on broad contours of three plans to redesign Social Security, relying on private retirement accounts and an array of other strategies to keep it from running out of money, according to the Washington Post.
Social Security faces increasing strains because the large baby boom generation will start retiring in about a decade and because many Americans are living to older ages.
"There is no pain-free way of 'solving' Social Security," said Richard D. Parsons, the panel's co-chairman and co-chief operating officer at AOL Time Warner Inc.
The 16-member commission will give Bush its final recommendations next month, according to the Post.
The individual investment accounts that Bush asked the commission to design are proving so politically volatile that Republican leaders in Congress have made clear they plan to defer the issue until after the midterm elections next fall.
Under the most simple alternative considered by the commission, the program would allow workers to deduct 2 percent of their Social Security taxes and invest them privately, perhaps with a contribution from general budget revenues for young workers who open such accounts.
In exchange for the higher earnings that private investments might bring, people with their own accounts would forfeit 3 1/2 percent of their ordinary retirement benefits when they stop working.
Even without additional changes, several panel members said, private accounts would alleviate the program's financial stresses, an argument key Democrats disputed.
The second alternative would allow investments of up to $1,000 a year in private accounts, and is the plan that would, in essence, curb benefit increases by linking them to the rate of inflation.
The third, most intricate plan similarly would let people deduct up to $1,000 for their own accounts, but only if they invested up to 1 percent of their earnings.
This alternative is the one that would rely on a permanent infusion of money from the rest of the federal budget -- a change from Social Security's tradition of operating largely on payroll taxes with its own trust fund.
The two more ambitious alternatives also attempt to increase retirement security for two groups that tend to be particularly vulnerable in old age: widows and the poor.
Both proposals would increase benefits for surviving spouses and, to varying degrees, create a new floor in benefits for retirees who have worked throughout their lives but earned little income.
White House commission assigned the task of proposing changes in the nation's retirement system will go even further than President Bush did in his election campaign, when he advocated allowing workers to invest some of their payroll taxes in the stock market.