The Sure Way to Protect Social Security Disability

Congress should act to protect the solvency of Social Security to ensure that disability and retirement benefits are secure for this generation of workers and the next.

The headlines have been filled in the last few years with stories detailing the precarious state of the Social Security program in this county. For years, we have been warned that both the retirement program, formally known as the Old-Age, Survivors Insurance (OASI) program, and the Social Security Disability Insurance (SSDI) program have financial problems.

These programs provide benefits that are essential in the lives of millions of Americans. More than 70 percent of older individuals and 48 percent of older couples rely on the retirement payments from SSA to make up 50 percent or more of their income. For disabled American workers, SSD benefits are literally a lifeline. If you are unable to work, federal disability benefits may be your only source of income, and many would be left homeless and destitute without these payments.

Change overdue

Unfortunately, the funding mechanism for OASI and SSDI has remained essentially unchanged for more than 20 years. Congress has bizarrely refused to deal with the issue in a straightforward manner. There is constant talk of rooting out “fraud and abuse,” making changes to the system, even calls for privatization.

The banking crisis of 2008 and the near meltdown of the world’s financial system seem to have diminished the call for outright privatization. While there is still incessant commentary complaining of “fraud and abuse,” most of the actual evidence shows that the disability system experiences very low rates of fraud, primarily due to the rigorous vetting process used to administer SSD benefits.

What should be done to make the system solvent?

The basic problem is that there is more money going out of the program than is coming in. Last year, Congress made 11th-hour changes to the allocation of money between OASI and SSDI because the SSDI trust fund was in danger of being exhausted. Had this not happened, a real crisis would have resulted, as the exhaustion of the SSDI trust fund would have left SSA about 20 percent short for every disability beneficiary.

A 20 percent cut to those receiving SSD would have been critical and severely damaging. It is likely that it would have left some disabled workers in a position where they could have lost their housing or worse.

A temporary fix

The problem is the fix is temporary. The SSD trust fund will still run out of money in 2023. The combined OASDI trust fund is projected to be exhausted by 2034. This is not new, as it has been the projected date for most of the last two decades. Politicians have been able to ignore it, as in the late 1980s and early 1990s, it seemed like a very distant date.

It is no longer very far away. The children born this year will graduate from high school in 2034. The good news is we still have time to implement a permanent fix that will keep the system solvent and prevent more of the disabled and seniors from falling below the poverty line.

Higher taxes, but guaranteed solvency

The bad news is it will require higher taxes. However, most people can afford these taxes. And what everyone should recognize is that you only pay the tax if you are working and by paying that tax, you are eligible for SSD benefits and when your retire, you will receive the OASI benefits.

For a family earning about $52,000 a year, the tax increase that would protect their OASI and SSDI benefits work out to a modest $147 per month. If that seem too much, check to see what private disability insurance would cost; which is the reason so few American have private disability insurance.

This seems like a reasonable price to pay for the ensuring that Social Security is truly secure for all Americans.

Need help?

Because of the demanding nature of the SSD application process, if you need help with your SSD claim, the attorneys at Law Offices of Ogle, Elrod & Baril PLLC can provide knowledgeable assistance will all of your questions and can help if you need to appeal a denial or attend a hearing.