Can we continue to support our disabled citizens?
The Social Security funding for people with disabilities is, after more than half a century, facing a deficit. Unless Congress and the President can find a way to agree on new funding and possible reforms, changes may be implemented to the Social Security Disability Insurance program that will impact the monthly benefits counted on by millions of disabled workers and their families. A payroll tax of 1.8 percent, and the interest from the program’s trust fund, has, until the past several years, financed the program successfully. To the dismay of a great many, however, the trust fund peaked in 2008 at $216 billion, but fell to just $60 billion in assets by the end of 2014.
Changes to Social Security Disability benefits might include expanding incentives for individuals to work rather than rely on benefits for their sustenance. At present, approximately 11 million people in the United States receive SSDI benefits; most of these individuals (9 million) worked previously, but have been deemed no longer able to engage in gainful employment. With program expenses exceeding payroll tax revenues by 26 percent during the past year, the projections for the future are dire. Most suggest that the trust fund will become totally depleted by late 2016 or early 2017, resulting in significant cuts in benefits to a population that cannot function without them.
There are several reasons for this disturbing news. One problem with maintaining the assets for Social Security Disability Insurance is the disparity in decision-making to qualify individuals for benefits. Research has shown significant variations in award rates determined by examiners, who evaluate applications, and judges, who consider appeals. Clearly, if this process could become more standardized, greater efficiency and lower cost would result.
Evidence of the discrepancies involved are found in the fact that half of the applicants for disability benefits who were initially denied them appealed the decision, and 60 percent of those individuals were eventually granted benefits. This means that almost 40 percent of decisions to award SSDI benefits were made on appeal. The hiatus between initial application time and final decision is not only inefficient and time-consuming, but may further harm applicants in terms both of their opportunities in the workplace, and their inability to receive benefits in a timely fashion.
Other factors contributing to depletion of funds in the SSDI program include:
- Economic hardship generally and wage inequality in particular
- Increased eligibility criteria for benefits, especially subjective ones (e.g. back pain)
- Aging of the Baby Boomer generation
- Increased number of women in the work force whose employment record makes them eligible for benefits
Recommendations for reform to stabilize and increase funds for the SSDI program include
- Introducing more frequent evaluations of clients’ eligibility for disability benefits and possible increased capacity to work
- Increasing the financial incentive for those receiving benefits to return to the workforce
- Intervening sooner to assist individuals before they lose their ability to be gainfully employed
- Giving employers a financial incentive to assist employees by contracting with private disability insurance companies
Investigations to discover other means of increasing funding for Social Security Disability benefits are ongoing and crucial to the maintenance of a social net for the millions of genuinely disabled people in the United States who are unable, not unwilling, to populate the workplace.
If you, or someone close to you, is dealing with a disability issue, our compassionate and knowledgeable attorneys are available to help you. Serving the entire Central Valley, California area, we can be reached for a free consultation at 559.439.9700.