It was one of the several big looming deadlines Congress is confronting as it hurdles towards the end of the year: The exhaustion of the part of Social Security that supports disabled people when they're unable to work.
It was also an opportunity. Over the past year, as lawmakers puzzled over how to shore up the fund, they also entertained a host of ideas for how to make the program better. Primarily, as we wrote last week, they were hoping to make changes that would support beneficiaries as they transitioned back to employment, given the abysmally low number of people who do that now.
Well, turns out congressional leadership was working up a budget deal that would take a crack at both things. The current draft borrows from another part of Social Security to replenish the disability fund for about seven years, and also authorizes a number of tweaks that could amount to the biggest adjustments the disability insurance program will see for years.
Several of the changes are aimed at rooting out waste: The bill expands the use of investigation units that partner with local law enforcement agencies to track down people who might be gaming the system. It also forbids ex-felons from making disability benefits determinations, beefs up penalties for fraud, and instructs the Social Security Administration to move everyone onto electronic recordkeeping, in an effort to avoid overpayments.
The thing that advocates for the disabled had advocated was a way to smooth out the "cash cliff," which is shorthand for how benefits disappear if a disabled person decides to work and makes more than $1,090 per month for more than nine months. The budget deal orders up a test to see what happens when you make that cliff into more of a slope, by decreasing a person's benefits by $1 for every $2 they earn. (A similar experiment has been underway for years, yielding moderately greater earnings for participants; this change would allow for the offset to kick in even when people make less than that $1,090.)
Now, this return-to-work incentive probably wouldn't save much money in the short term, even if it were to be implemented more generally. "I don’t have much confidence that ending the cash cliff with a one for two programs is likely to do much to reduce the rolls," says Cornell University professor Richard Burkhauser, who studies the economics of Social Security. "It is more likely to increase the number of people on the rolls but increase the share who do some work."
That might be good for disabled people and the economy writ large, which would benefit from their participation in the workforce. But Burkhauser thinks the more effective route would be to help people stay at work if they're able before ever needing to apply for disability insurance, since returning to a job after an extended period away can be extremely difficult. There are a number of ways to do that, including asking employers to pay more of the cost of disability insurance, which would incentivize them to provide better accommodations for injured or sick employees.
Congressional aides expect the disability insurance tweaks in the budget will save $5 billion over 10 years, which is peanuts compared to the program's $141 billion annual cost. The fact that Republicans didn't win bigger cuts, however, is a victory for the Obama administration and a relief for disabled people and those who work with them.
More thoroughgoing reforms may have to wait for another year, or another Congress. Without the specter of the disability trust fund running out, there's less pressure to make programmatic changes -- and in a still-Republican Congress, it appears that the changes that were going to happen have happened in this budget.