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The Future Of Social Security Disability Benefits

The Social Security Disability program has seen significant growth in both costs and the number of beneficiaries in the last 25 years. Since 1990, the working-age population receiving disability benefits has more than doubled—from about 1 in 40 individuals to about 1 in 20. Government spending on the Social Security disability program has doubled since 2000.  Some of this growth is due to aging baby boomers applying and receiving disability benefits.  Some of the growth is due to a greater number of working women becoming insured under the program and to the Social Security retirement age increasing slightly  over the past decade.

About one-third of the drop in labor force participation from 2007 to 2013 is due to 2.1 million more Americans going on Social Security Disability Insurance.  This may be because individuals turned to the program as an early retirement and long-term unemployment program,  particularly during the recession.
The problem with this is that when those with marginal or temporary disabilities succeed in getting on SSDI, they tend to stay in the program—and over time their skills erode.  As individuals age it also becomes more difficult to find a job.

In this year presidential election year, the issue has been raised as to how to address SSDI’s impending trust fund shortfall.  The SSA has already spent significant amounts of money and resources attempting to root out fraud in the program (although there is very little evidence that they have done anything more than waste resources and time) and they have attempted to manipulate the administrative law system by  reviewing every ALJ decision (both favorable and unfavorable) throughout the nation, which places a judge’s decision in the hands of a non-lawyer to be reviewed for conformity, rather than merit.  The SSA’s efforts are misplaced, as they should seriously consider replacing permanent benefits with a period of disability that better reflects the individual’s disabling condition and acknowledges the possibility of future work capacity.   Disability benefits should not be eliminated or replaced, but Congress should acknowledge that many people have temporary disabilities and they could return to the workforce if given vocational rehabilitation and the incentive to do so.

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