The Biden administration recently released its first official budget plan, which recommends a 9.7 percent increase in the administrative budget of the Social Security Administration (SSA). This increase in top-line funding would partially reverse the chronic underfunding of the agency by Congress (SSA’s core operating budget, adjusted for inflation, fell 13 percent from 2010 to 2021, while the number of beneficiaries SSA serves grew by 22 percent). However, problems with SSA’s administrative funding go beyond insufficient funding of top-line numbers.
Increasingly, Congress has directed funding away from service delivery to disability reviews that remove individuals from the rolls based on SSA’s assessment of medical improvement. This trend came about because of a peculiar “Inside the Beltway” dynamic where SSA was desperate for administrative funds and Congress saw reviews as a politically acceptable way to reduce the disability rolls. Using the argument that disability reviews, on net, saved the government money, Congress exempted their administrative costs from budget caps. Last year, the appropriators earmarked $1.6 billion of SSA’s administrative budget for disability and other reviews.
While budget caps end with this fiscal year, disability reviews have now become ingrained in SSA’s work culture, even at the expense of fulfilling its core mission as a benefits paying agency that keeps millions of elderly and disabled Americans out of poverty.
SSA plans to increase the number of full medical disability reviews next year by 36 percent and increase the number of Supplemental Security Income (SSI) redeterminations by 23 percent.
Congress should support the Biden administration’s top-line funding number for SSA, but it should also pause increases in disability reviews and redeterminations for at least a year to study the problems with the review process itself.
Interestingly, it was regulatory overreach by SSA that revealed these problems.
In response to a regulatory proposal last year to increase the frequency of reviews, which proved to be controversial and was withdrawn by the incoming Biden administration, disability advocates argued that SSA’s current review process is often harmful and unfair. They presented compelling human stories of individuals with cognitive impairments not understanding complex medical and legal issues and of individuals in chaotic circumstances (poverty, domestic abuse and homelessness) who unsuccessfully struggled to keep up with SSA’s review process as they managed serious disruptions in their daily lives.
It is not easy to dismiss these human stories as anecdotes because studies and large-scale data collections back them up. SSA recently published a study that found more than 800,000 disability applicants over the period 2007-2017 experienced homelessness. Even for disabled persons who have more settled circumstances and who are interviewed in household surveys of the federal government, the complexity of daily life is evident. About 40 percent of Social Security disability beneficiaries face food insecurity or an inability to pay utility or housing bills. One quarter were hospitalized during the year.
Many Americans have little difficulty running errands or managing daily tasks, but nearly 60 percent of disability beneficiaries have difficulty walking as short a distance as three blocks, and almost 40 percent have trouble concentrating long enough to finish everyday tasks.
The difficult circumstances of disability beneficiaries might be less of a concern with regard to reviews if these individuals had help or representation. However, only 5 percent to 20 percent have representatives to help in appealing unfavorable decisions.
Congress should consider a remarkable statistic before it assumes that the current review process scientifically determines medical improvement: If a disability beneficiary understands that the initial decision can be reconsidered and gets paperwork in on time, a different disability examiner will overturn the initial examiner’s finding of medical improvement 65 percent of the time.
The problem of involved paperwork requirements is also evident in other statistics. In 2019, SSA suspended payments to 137,000 SSI beneficiaries because they failed to “furnish” some required paperwork. The suspensions have increased 250 percent in the last 10 years.
SSA plans to accelerate disability reviews next year so the agency can rapidly get back to being “current” on conducting the maximum number of reviews allowed by regulations. However, the agency shows no similar urgency on being “current” on other program integrity workloads.
It has been 10 years since SSA mailed the Social Security Statement to workers under the age of 60, hampering their ability to challenge incorrect earnings in SSA’s system or to find out about disability and survivor benefits. In addition, SSA has identified a large number of “potential entitlements” (agency language for not paying benefits that are legally due to individuals) and shows very little interest in being current on that workload.
SSA is also dealing with a serious crisis in the SSI program, where applications and awards have collapsed due to field office closures. The declines have been largest among the very elderly and persons with limited English proficiency and other groups needing help in the application process. To its credit, the agency is working on the problem, but its plans to spend $1.35 billion in administrative funding on reviews of SSI recipients, while only spending $96 million in SSI outreach and application assistance, represent a misallocation of resources given the agency’s core mission.
Congress needs to pause increases in disability reviews and redeterminations until it can study — and possibly reform — the administrative process. That will also have the beneficial effect of allowing SSA to focus on service delivery as it begins to find its footing following the pandemic.
David A. Weaver, Ph.D., is an economist and retired federal employee who has authored a number of studies on the Social Security program. The views in this article do not reflect the views of any federal agency.