We realize it may be a stretch for ordinary people to want to keep up with the comings and goings of the Social Security Administration, but sometimes circumstances permit where someone does want to follow the latest news regarding the agency due to a possible retirement or disability interest. This blog is an ongoing piecemeal of recent stories that have involved Social Security. Some are tidbits and some are important things that should be known in the world of retirement or disability and others are just interesting stories and nothing more.
Less People Collecting Social Security Disability These Days
The Center for Retirement Research at Boston College recently issued a study on the factors that have led to less people collecting Social Security disability benefits than just a few years ago. Since 2015 the number of individuals collecting Social Security Disability Insurance (SSDI) benefits dropped compared to the previous two decades and the trend is continuing. Below are some key points from the conducted study and gives some insight as to why less people are receiving disability benefits than there used to be.
This drop was caused by a wave of terminations, as beneficiaries aged into the Old-Age and Survivors Insurance (OASI) program, combined with a steep decline in the incidence rate (the number of new DI awards relative to the insured population). Yet, the forces driving down the incidence rate remain poorly understood. Prior studies suggest that three factors could have played a role: 1) a strong economy following the Great Recession; 2) demographic shifts due to population aging and the decline in manufacturing; and 3) policy changes at the Social Security Administration (SSA). Using data provided by the SSA’s Office of Disability Programs, this study examines how each of these factors contributed to the drop in the incidence rate.
The paper found that:
- A strong economy accounted for about half of the drop in the incidence rate.
- Policy changes – specifically the retraining of Administrative Law Judges – also
accounted for about half the drop.
- Population aging put slight upward pressure on the incidence rate.
- In terms of the total number on the disability rolls, the impact of aging on terminations
far exceeds its impact on new awards.
The policy implications are:
- The time may have come to somewhat rebalance the goals of DI from encouraging labor
force participation to protecting vulnerable people.
- Congress may want to consider merging the DI and OASI trust funds.
