Senate Holds Hearing on Social Security and Barriers to Work

The Senate Committee on Finance held a hearing on the barriers to work faced by Social Security Disability Beneficiaries.

The Senate Committee on Finance held a hearing June 21, 2007 on the barriers to work faced by Social Security Disability Beneficiaries. The Committee Chairman, Sen. Max Baucus (D-MT) and Ranking Minority, Sen. Charles Grassley, (R-IA) have a history of working together on many issues, but their opening statements at the hearing, while both recognizing that very few beneficiaries return to work, had distinctly different emphases.

Sen. Baucus, after observing that only 6 out of every 1,000 Social Security Disability Insurance (SSDI) beneficiaries returned to work in 2004, noted that fear plays a large role; i.e., fear that they will lose health insurance, fear of having to repay overpayments resulting from untimely processing of earnings reports, fear that it will take a long time to return to the program and fear that their work effort will be used against them when they reapply for benefits. Another factor mentioned by Sen. Baucus was the decline in health while people wait long periods without access to health care while they await a determination of their application for SSDI or Supplemental Security Income (SSI) Disability benefits. He also mentions the lack of rehabilitation services, the complexity of existing work incentives and the unrealistic restriction on earnings in both SSDI and SSI as well as the restriction on assets in SSI.

In contrast, Sen. Grassley warned against “an unsustainable policy of extending disability benefits to those who are able to work well beyond the substantial gainful activity level.”

The lead-off witness at the hearing was Sue Suter, Associate Commissioner for Employment Support Programs at the Social Security Administration (SSA) who outlined existing employment incentives. She was followed by Allen Jensen, Director of The Work Incentives Project at the Center for Health Services Research and Policy of George Washington University who stressed three themes as a framework for policy development: Security, Simplicity and Sustainability. His major policy recommendations included:

• Continued attachment to programs in non-benefit status as long as the disability continues;

• Gradual reduction in benefits as earnings increase as opposed to the “cash cliff” of the current SSDI program, which provides for a complete cessation of cash benefits when earnings reach a certain threshold;

• All for increased savings in SSI;

• Comparability between SSI and SSDI work incentives;

• Increase capacity of SSA to administer work incentives and provide timely and accurate adjustment of benefits; and

• State and local systems change initiatives that support infrastructure development, work incentive counseling and services.

The other witnesses were David C. Stapleton of the Cornell University Institute for Policy Research and Jim Brown who recounted the difficulties he encountered when he went on SSDI after breaking his neck in an accident. Mr. Stapleton took the view that there is a need for a transformation of federal disability policy and that the SSDI program is unduly burdened because “it is trying to meet the needs of significant numbers of workers with disabilities who would be better served by a program that helps them continue to be self-sufficient through work.”

For further information, contact Gerald McIntyre in the NSCLC Los Angeles office.