Skip to content

Joint Hearing on Work Incentives in Social Security Disability Programs

September 23, 2011

As my colleagues have discussed, today’s hearing examines the effectiveness of work incentives administered by the Social Security Administration (SSA) designed to help people with disabilities go to work.   

Chairman Johnson and Ranking Member Becerra focused on the effects especially on individuals who receive disability checks from the Social Security Disability Insurance program.  As Chairman of the Human Resources Subcommittee, I want to discuss the implications for people on the Supplemental Security Income or SSI program, which falls under our Subcommittee’s jurisdiction.  

This is our first hearing this year specifically on the SSI program, and I can’t think of a more appropriate topic than how we help people go back to work and whether those efforts are succeeding.

Since SSI first started paying benefits in 1974, this means-tested cash assistance program has always encouraged work and earnings by reducing benefits by only one dollar for every two dollars in earnings.  In other words, SSI by design tries to overcome disincentives to work inherent in a benefit program for disabled people with very low income. Even though SSI recipients have less work experience than SSDI recipients, an average of five percent leave the SSI rolls each year due to income from work or other sources – this is 10 times the rate for SSDI recipients.

Still, 5 percent is a very low rate.  The key questions we have today are do current programs and policies actually promote work?  And if not, what else should we be doing?

Our focus is on working-age disabled individuals, nearly 40% of whom have expressed an interest in working.

Disability applicants spend months, and in most cases years, proving they are disabled enough to merit benefit payments. Once they successfully prove they are too disabled to work, we encourage them to try work with the goal of leaving the benefit rolls again.

If it sounds complicated and contradictory, that’s because it is.  SSA manages a complex system of work incentives that include various exemptions, exceptions, and disregards that are both difficult for beneficiaries to understand and for SSA to efficiently administer.  This confusing diagram displaying just the SSI work incentives says it all:

A similarly confusing chart exists for the SSDI program.

What this all suggests is we need more balance. Balance for the beneficiary when it comes to easing the transition to work while reducing complexity that has become an obstacle to work.  And balance for the Social Security Administration in administering complex work incentives efficiently and effectively. Ultimately, this involves a balance of taxpayer dollars, too. What is the right balance of incentives for individuals who are unable to work due to disability, and who receive cash benefits, health coverage, and support from a range of other assistance programs?  Is there more assistance that would better help them work?  Or would more assistance make it even harder for them to work, if the benefits of not working increasingly outweigh the benefits of working?  What is the right balance?  

This discussion is why today’s hearing is so important. Encouraging work and self-sufficiency improves the well-being of individuals and families, regardless of their disability status.  We need to look deeper into these programs to hold SSA, current work incentives, and ourselves accountable for achieving this goal in a fiscally responsible manner. We cannot continue to just “do more” and “spend more” and hope that it helps. We need to start by reviewing whether what we are already doing is working to help beneficiaries, so we can ensure taxpayer resources are properly targeted.
We have an excellent panel of witnesses with us today to discuss these complicated issues and more, and we look forward to all of their testimony.