A FEW WEEKS AGO, a bill to reform the Disability Insurance program of Social Security was signed into law. It may be a measure of the political sensitivity of making tough, reasonable changes in entitlement programs such as this one that it was felt the entire enterprise had to be conducted with very little publicity. But that is unfortunate: the bill is a good one, and it is evidence that the president and Congress can work together to make sound money-saving changes in the vast entitlement programs of the federal government.
Disability Insurance was established in 1956, on the theory that some kind of income protection should be given those who, before they reach retirement age, become too disabled to work. At that time, a person had to be at least 50 years old to qualify, and no benefits were provided for dependents. Over the years, the categories of people covered and of benefits provided were considerably expanded, so that a large part of the money was finally going to young persons who had met with accidents or disabling illness early in their working lives. The basic structure of the program, however, was not changed, and the program was not working well for young people. A combination of provisions made it very difficult for people to try to go back to work once they were admitted to the program. Disability benefits were relatively high compared with what one might earn on return to a job, and going back to work meant giving up Medicare privileges and the chance to return to the rolls if the job didn't work out.
This bill changes the work incentives for the young disabled. It provides a promise of continued Medicare coverage for nearly four years after the person returns to work and an assurance that even after that the person can re-enter Medicare if his condition deteriorates. For severely disabled people, this promise of medical coverage is even more potent than for the general population, because the danger of encountering serious medical problems is considerably greater. But the bill also puts a lower ceiling on benefits available to disabled workers and their families. This change makes benefits much more like those paid in private disability programs. c
All in all, the legislation contains new federal costs and some savings. On balance, it will cut back on federal expenditures increasingly over the years: in 1981, less than $50 million in savings is projected, but by 1985 the savings will be in the billion-dollar range. Savings will continue to increase as people enter the rolls under the new rules.
This is the kind of change in entitlement programs that makes sense. It is to the creidit of both Congress and the president that they went ahead with this difficult and technical but genuine reform in the midst of the heat of election-year politics.