SSDI: Sustaining Our Lifeline for Decades to Come!
As The Arc celebrates Social Security’s 80th anniversary this August, we kick off the month by marking the 59th anniversary of Social Security Disability Insurance (SSDI). Signed into law on August 1, 1956 by President Dwight D. Eisenhower, SSDI insures nearly all American workers and their families in the event of life-changing disabilities. Without SSDI, many families with members with significant disabilities – including people with intellectual and developmental disabilities (IDD) – would face financial dire straits and often unthinkable choices.
Our Social Security system has withstood the test of time. But this bedrock of our nation’s economy requires periodic maintenance to remain strong.
Today, our SSDI lifeline stands at great risk. Here are three facts that people with IDD, their families, and friends need to know about SSDI and the action that Congress must take:
1. Congress must act by the end of 2016 to prevent a 20% across-the-board cut in SSDI benefits.
Congress from time to time needs to adjust Social Security’s finances to account for population and economic shifts. The need to replenish the Social Security’s Disability Insurance (DI) fund in 2016 to account for long-term trends, such as an older workforce now in its disability-prone years, has been expected for several decades. Without Congressional action, at the end of 2016 the DI fund’s reserves will be depleted, leaving only incoming payroll contributions to pay for benefits. As a result, unless Congress acts, SSDI beneficiaries will face benefit cuts of 20% at the end of 2016.
2. Two ready, sensible solutions can prevent SSDI benefit cuts: merging Social Security’s trust funds, or ‘reallocation”.
Over the last 5 decades, Congress has repeatedly, on a bipartisan basis, used a simple, commonsense solution to address shortfalls in either of Social Security’s two funds (the Old-Age and Survivors Insurance or OASI fund, and the DI fund). A temporary shift to direct more Social Security revenues to the DI fund – called “reallocation” — will extend the solvency of the DI fund for almost two decades, through 2034. Congress has made similar shifts 11 times in the past, about equally increasing the percentage going into one fund or the other. Reallocation does not require any new taxes. Additionally, the solvency of the overall Social Security system stays the same, with the combined funds remaining fully solvent through 2034.
Another approach – proposed in the One Social Security Act (H.R. 3150) – would merge Social Security’s OASI and DI funds into a single Social Security Trust Fund. This would align Social Security’s finances with the program’s reality: an integrated system of retirement, life, and disability insurance paid for by a single payroll tax. It will eliminate needless crisis points, such as the pending 2016 depletion of the DI fund. And it will better enable Congress to consider the system as a whole to develop responsible ways to strengthen benefits and finances over the long-term, to ensure that Social Security will be there for generations to come.
3. Congress can secure SSDI’s finances while rejecting harmful approaches.
Unsurprisingly, Americans overwhelmingly support preserving and strengthening Social Security, and oppose benefit cuts. Fortunately, Congress can secure SSDI’s finances while rejecting approaches that would harm people with disabilities and their families.
- Congress needs to reaffirm the Security in Social Security, and reject short term solutions to the shortfall. Artificial crisis points, such as the one currently faced by the DI fund, cause great alarm for beneficiaries and their families who are forced to live for years with the fear of major cuts to benefits that often mean the difference between financial security and extreme hardship. Short-term patches to the DI fund would force SSDI beneficiaries and their families to live in a perpetual state of fear and uncertainty.
- Congress should reject any proposals that cut eligibility, benefits, or coverage. SSDI benefits average only about $40 per day, making up the majority of income for most beneficiaries and the only source of income for one in three beneficiaries. It’s hard to imagine how anyone could get by if these extremely modest benefits were cut.
As the end of 2016 grows near, Congress must hear from people with IDD, their families, and friends that we want Congress to sustain our SSDI lifeline for decades to come.
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