Monday, October 20, 2014



Social Security Disability Beneficiaries facing potential 20 percent cuts in monthly benefits

The Social Security Disability Trust fund is expected to run short of its ability to meet its obligations in 2016. If Congress doesn't address the problem, individuals who currently receive Social Security Disability benefits may face a 20 percent cut in their monthly benefits.

So far, there's hardly a peep out of Congress about this rapidly approaching issue. And, increasingly, it looks like this may be another round of political hardball between republicans and the current White House administration.

What members of Congress should keep in mind, however, is that, unlike SSI, Social Security Disability is a program for which recipients have paid into the system through deductions taken out of their paychecks. From the point of view of disability beneficiaries, and rightly so, they are receiving an earned benefit. They worked, paid their taxes, and are now receiving benefits to which they are entitled as a result of becoming disabled.

Congressional Republicans who choose to take advantage of the impending situation as a virtual hostage (i.e. letting SSD beneficiaries face a drastic 20 percent cut in monthly benefits unless unless certain political demands are not met) may find themselves making a terrible calculation for several reasons:

1. Even the appearance of choosing political maneuvering over people's financial stability and well-being just doesn't sit well with most Americans.

2. SSD benefits are not welfare; they are an earned entitlement. They were paid for.

3. If SSD beneficiaries have their benefits cut, it will negatively affect not only them, but their families as well.

For quite a few years now, Congressional Republicans have pointed t to the increase in disability claims as proof that something is wrong with the program. They insinuate that the process is too easy, that judges are too lenient, and that the system over-awards benefits. However, if you were to survey a thousand people who had actually gone through the process of applying for disability, they would tell you that the process is long and difficult, their claims were routinely denied despite solid medical evidence, and that judges are typically anything but rubber stampers.

With all this in mind, I have wondered when it was that AARP would choose to get involved. Their membership is comprised of retired Americans; however, some of those individuals have physical and mental impairments that are disabling and many recognize that based on their age and limitations, becoming disabled as a result of an injury or illness is not an improbable scenario.

Recently, AARP sent a letter to Senators Ron Wyden and Orrin Hatch, respectively the Chairman and Ranking member of the Senate Committee on Finance. Here are two excerpts:

"...the highest priority in the near term is to ensure that SSDI beneficiaries -- most of whom are older Americans -- are not at risk of a 20% benefit cut in the very near future."

"...interest income specified for the DI program is sufficient to support 80 percent of program cost after trust fund depletion in 2016, increasing slightly to 81% of program cost in 2087." CBO maintains similar projections."

"Many experts, including the Congressional Budget Office, have estimated the shortfall is largely due to: 1) general population growth, 2) women’s entrance into the labor force and consequent eligibility for SSDI benefits, 3) the increase in the Social Security normal retirement age from 65 to 67, and 4) the aging of the Baby Boom population leading to a higher percentage of older people vulnerable to illness and disability. All of these factors also contribute to other challenges in the SSDI program."

In other words, the Social Security Disability program is facing a shortfall due largely to demographic changes. In addition to the workforce getting wider, America is getting older and grayer. And people, as they get older, tend to have a higher chance of becoming sick or injured. It is a simple fact of life. The program is not facing shortfalls, as the Republicans have falsely impugned, because large numbers of Americans are choosing to pursue disability benefits versus seeking employment.

I don't know what the effect of this letter may be. And I don't what else we may hear from AARP on this issue as we draw nearer to 2016. However, I think certain members of Congress should choose to do what is right and guarantee that Americans who have paid into the system and are now collecting the disability benefits that they have earned continue to receive them in full. I certainly don't recall members of Congress volunteering any cuts in their own extensive package of benefits, which are cadillac-level by anyone's estimation.

Return to My Disability Blog