Social Security disability reform: An issue that can’t wait

When it comes to shoring up the Social Security Disability Insurance (SSDI) trust fund, one thing is certain: Time is running out.

The Social Security trustees recently released their annual report on the financial state of the trust funds, and the findings confirmed what many have known for a long time – that the SSDI trust fund faces imminent depletion. Lawmakers have a little over one year to figure out how to fund scheduled disability benefits before the program is forced to enact across-the-board cuts of nearly 20 percent. As former chairmen of the House Ways and Means Subcommittee on Social Security, we see this as both a serious issue that needs to be quickly addressed as well as an opportunity to make improvements to the program.

ADVERTISEMENT
The trustees first made their prediction about the 2016 exhaustion date 20 years ago; little has changed for the program’s finances since. Failure to act on these warnings has left policymakers with limited options to avoid DI insolvency, which serves as a reminder of the dangers of delaying decision-making on Social Security financial challenges. The recent Trustees report warns that the old age and survivors trust fund faces greater long-term shortfalls than the disability trust fund, with the expected depletion in combined insolvency date in 2034.

This 20 percent cut scheduled next year would be devastating to the 11 million SSDI recipients – most of whom are workers with disabilities who rely on SSDI benefits to make ends meet. The overwhelming majority of those receiving support because of their inability to work depend upon this program. In most cases it is the only income they have.

Luckily, both Democrats and Republicans have made clear their opposition to this cut, and there is a potential for bipartisan agreement on action to avoid imminent depletion of the trust fund accompanied by reforms that improve the SSDI program and lay the foundation for larger reforms as we learn what works.

Yet, if lawmakers pass only a “clean reallocation” of payroll tax revenue from Social Security’s old age program to its disability program, they will have missed the opportunity to improve the SSDI program. As the Social Security Public Trustees explain, “Any necessary resource reallocation that does occur should not be regarded as a substitute for action to sustain the finances of DI and Social Security as a whole, nor enacted in a manner that has the effect of further postponing those required corrections.”

Yes, the upcoming deadline represents a challenge. But more importantly, it represents an opportunity. Much can be done to improve the SSDI program. The determination process could be streamlined to reduce waiting periods and improve accuracy. Fraud and incorrect payments could be reduced. Those who are already on the program could be given more support in efforts to return to work. And those not yet on the program could be given more opportunities to keep collecting a paycheck instead of a Social Security check.

And while no one has all of the answers to how we can best improve SSDI, that’s not a reason to delay.  

It is for this reason that the two of us launched the McCrery-Pomeroy SSDI Solutions Initiative nearly a year ago – to help provide lawmakers and administrators with a menu of ideas that can improve the program for millions of Americans with disabilities and their families. We’re extremely pleased with the progress so far, and we’re excited to share more about the 12 papers we’ve commissioned in our upcoming August 4 conference.

Our initiative has already identified areas where policymakers can make the program work even better for beneficiaries, including early intervention, determination and adjudication reform, interaction with other programs, and structural reforms to the program. While these improvements alone will not stop the trust fund’s impending depletion, they are ideas that can be paired with temporary measures delaying trust fund depletion that lay the foundation for long-term efforts to enhance SSDI’s effectiveness and helpfulness for people with disabilities.

In their report, the trustees agree that the upcoming shortfall is an opportunity for reform, stating that while “legislation may now need to include some reallocation of resources between the two trust funds. Reallocation of resources in the absence of substantive reforms might, on the other hand, serve to delay DI reforms and much needed corrections for OASDI as a whole.”

We hope that Wednesday’s report amplifies this message: Action is needed, and steps to make sensible reforms to the program should accompany any short-term funding measures.

McCrery served in the House from 1988 to 2009. Pomeroy served in the House from 1993 to 2011.