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Economy
See other Economy Articles

Title: Disability Applications Plunge as the Economy Strengthens
Source: New York Times
URL Source: https://www.wral.com/disability-app ... -economy-strengthens/17639836/
Published: Jun 20, 2018
Author: Nelson D. Schwartz, New York Times
Post Date: 2018-06-20 09:12:32 by misterwhite
Keywords: None
Views: 28
Comments: 1

The number of Americans seeking Social Security disability benefits is plunging, a startling reversal of a decades-old trend that threatened the program’s solvency. It is the latest evidence of a stronger economy pulling people back into the job market or preventing workers from being sidelined in the first place.

The drop is so significant that the agency has revised its estimates of how long the program will continue to be financially secure. This month, the government announced that the program would not run out of money until 2032, four years later than its previous estimate last year. Two years ago, the government had warned that the funds might be depleted by 2023.

In addition to stronger economic growth, the drop reflects newly tightened standards for eligibility and the increasing number of baby boomers who are leaving the program because they have become eligible for Social Security retirement benefits and Medicare.

Fewer than 1.5 million Americans applied to the Social Security Administration for disability coverage last year, the lowest since 2002. Applications are running at an even lower rate this year, government officials say.

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All told, 8.63 million workers received disability benefits in May, down from a peak of 8.96 million in September 2014. A drop of several hundred thousand may not sound like much. But it is a sharp turnaround from what seemed to be an inexorable rise, in which the disability rolls more than doubled over the past 25 years. That increase led some conservative lawmakers to criticize the program as wasteful and riddled with fraud.

The Social Security Administration expected the number of applicants to decline after the recession when the total number of beneficiaries topped out, but even government number crunchers were caught off guard by the steepness and duration of the fall.

“It has just kept dropping, by a much greater extent than we anticipated,” said Stephen C. Goss, the agency’s chief actuary. “We’re still not done — we should have a little bit more good news in 2018.”

When the economy is strong and growing, there tends to be more lower-skilled jobs available that do not require manual labor — the kind of work that many people with modest disabilities are best suited for.

“When the economy gets better, employers are more willing to look to other labor pools and be more accommodating,” said Eric Kingson, a professor of social work at Syracuse University. “Some people with disabilities also have a sense there may be something out there that fits with their needs.”

Of course, other factors have contributed to the decline in disability applications. As aging baby boomers receive Social Security retirement benefits and Medicare, fewer require disability benefits. People in the disability program receive an average of $1,200 a month and get health insurance through Medicare.

What’s more, with the expansion of Medicaid in 33 states and the District of Columbia as well as improved access to insurance coverage under the Affordable Care Act, many experts argue, fewer people see the disability program as a way to obtain health care.

Finally, the Social Security Administration has been making it harder to qualify for benefits, according to scholars and advocates.

In some cases, just applying has become more arduous, said T.J. Sutcliffe, senior director of income and housing policy at the Arc, an advocacy group for people with disabilities. Budget cuts have taken a toll, she said, with 67 Social Security field offices closing since 2010.

A 2017 study by Manasi Deshpande of the University of Chicago and Yue Li of the State University of New York at Albany found that “field office closings lead to large and persistent reductions in the number of disability recipients.” Applicants with “moderately severe conditions, low education levels and low pre-application earnings” were hardest hit.

Applicants also face an increasingly uphill battle appealing rejections, with the administrative law judges who handle these cases taking a much more skeptical stance.

“If you make it harder, people just run out of gas,” said Richard Browdie, chief executive of the Benjamin Rose Institute on Aging in Cleveland. “There are a whole bunch of new impediments, and I think the process has become overly restrictive.”

The internal changes were spurred by a deluge of criticism in the media and in Congress. Exposés on “60 Minutes” in 2013 and in The Wall Street Journal in 2011 depicted widespread abuse and fraud as millions signed up for benefits.

“Some in Congress refuse to acknowledge that the disability programs are broken and in dire need of significant oversight,” Sen. Tom Coburn, R-Okla., who led an investigation into the program, warned in 2013. “People who are truly disabled will pay the price of our dithering.”

In response, the Social Security Administration analyzed why some of its judges were approving a much larger proportion of appeals than others, said Nicole Maestas, a Harvard economist. Judges were retrained, and those who approved appeals at higher rates were singled out for special instruction, she said.

Overall, the odds of a successful appeal fell to 48 percent in 2015, from 69 percent in 2008. The move to tighten standards for disability claims was quickly felt. For example, Binder & Binder, a law firm based in Hauppauge, New York, that had once flooded the airwaves with ads offering help in filing disability claims for years, declared bankruptcy in 2014 and laid off most of its staff in 2017. The Social Security Administration tightened the approval process “behind the scenes” without a big announcement, said Mark Duggan, director of the Stanford Institute for Economic Policy Research. “In part, it was a response to the media spotlight and subsequent investigations,” he said.

Whatever the cause — demographic, economic or driven by policy — the postrecession narrative of an out-of-control entitlement program has been upended, said Torsten Slok, chief international economist of Deutsche Bank.

“This is a big deal,” Slok said. “We thought the numbers for disability would go up forever.”

Slok said he saw a deeper significance in the falling number of claims — he said it suggested there may be more workers on the sidelines than many experts estimate. If he is right, the Federal Reserve might not need to rush to raise interest rates, despite the unemployment rate falling to 3.8 percent in May, an 18-year low.

Still, as the labor market tightens, not only are less-physically demanding jobs more widely available, but employers are more willing to consider workers they might have overlooked in the past.

During boom and bust alike, Christian Borrero always wanted to work full time. Born with cerebral palsy, Borrero, 31, had been receiving Social Security checks in one form or another for nearly his entire life. A program sponsored by a nonprofit organization enabled him to work at a bank answering phones, but the salary in that part-time job was low enough that Borrero still qualified for disability payments.

In 2015, a landscape supplies and waste-to-energy company offered him a full-time job as a receptionist. Borrero turned it down — twice. “I knew deep down if I took it, I would lose my benefits,” he recalled. “I was terrified.”

Friends persuaded him to reconsider. So when the firm, Kurtz Bros. in Independence, Ohio, made him a third offer, he took a few days to consider it and eventually said yes. “I was still terrified of going off disability, but I’d never had a job with real benefits and real hours,” he said.

After he was on the job for several months in 2016, what Borrero had feared came to pass — the Social Security Administration informed him that his disability benefits would soon stop because he had a full-time job.

Borrero was so determined to keep working, he resigned himself to finding a second job to replace the $895 a month in disability benefits he would no longer receive. But when Kurtz Bros. got wind of his plan, it gave him additional responsibilities and a raise that made up for the lost money.

“Unemployment is down, and it can be incredibly difficult to find good people,” said Jackie Repicky, human resources director for Kurtz Bros. “So when we find people who work hard and have a great attitude, we try to keep and promote them.” For Borrero, the experience has been life-changing. “It’s very, very rewarding,” he said. “They treat me like a regular employee. They never baby me.”

At the bank, he said, “I was never going to move anywhere. They were supportive, but I wanted to move from a supportive environment to a competitive one.”

“I haven’t had an easy life,” he said. “But I love the feeling of earning enough money to pay my bills and do what I want to do. I feel very blessed.”

Other disabled workers may not be so fortunate to find a position that enables them to forgo disability benefits, he added, “but my example shows they can try.”

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#1. To: All (#0)

What does one have to do with the other? Either you're disabled or you aren't. This is bullshit.

Social Security Disability Insurance (SSDI) is part of Social Security. It uses the same pool of money. Meaning, for every dollar paid to a "disabled" person, that's one less dollar for retirees.

Currently, the federal government pays out nearly $200 billion in SSDI payments to around $10 million "disabled". That's $20K per year tax-free per individual. To sit at home.

This is in addition to the $60 billion paid (from the general revenue fund) to another 8 million people under the Supplemental Security Income (SSI) program.

Way too many people in the cart and not enough pulling.

(By the way, the numbers are down because Trump is cutting the funding for both programs and tightening up on eligibility. A lot of fraud.)

misterwhite  posted on  2018-06-20   9:31:34 ET  Reply   Trace   Private Reply  


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