GOP plans overhaul for Social Security disability
By Joseph Lawler | February 23, 2015 | 5:00 am
Republicans are planning to do something about the looming exhaustion of the trust fund for Social Security disability insurance, and their intentions have Democrats and Social Security advocates worried.
What Republicans have in mind for the massive program that serves some of the most vulnerable people in the country hasn't been spelled out yet, and there is little precedent to provide guidance.
Republicans, including House Ways and Means Chairman Paul Ryan, have just begun sketching out their priorities for the reform they say they want, even though they have set up a confrontation over disability insurance this year, just before the program's trust fund is projected to run out of money in late 2016 and force nearly 20 percent cuts for all beneficiaries, according to Social Security’s trustees.
Speaking to reporters before Congress left for the Presidents Day week break, the Wisconsin Republican sketched out three broad possibilities for slowing costs and keeping people working rather than in the program. He said that “we’re engaging with the disability community to see if we can find a way forward.”
The first is improving programs meant to help people who are able to work find jobs and leave the rolls.
Congress has tried similar measures in the past, including the “Ticket to Work” program passed in 1999 that provided incentives for companies or agencies to help beneficiaries find work. Few disability recipients, many of whom spent several years proving that they were incapable of working, are willing to trade the security of a monthly check for the risks of entering the job market.
Of the nearly 9 million disabled workers receiving benefits in 2012, the most recent year for which data is available, 193,042 tried working, according to the Social Security Administration. Only 31,591 beneficiaries, or roughly a third of 1 percent of everyone on the rolls, worked enough to earn enough income to be taken off the rolls, according to the latest statistics.
Ticket to Work was “poorly executed and complicated” and worth revisiting, Ryan said.
The second set of options, Ryan said, would be shortening the time it takes for disability applicants to receive a decision on their applications for benefits. It can takes years for workers to get a final decision on whether they get benefits, and while their application is being considered, they can’t work for fear of demonstrating that they are not disabled.
Lastly, Ryan suggested that Republicans would be interested in improving program integrity. “There are people who are getting benefits who shouldn't, and that hurts the people who need it,” he said.
Republican lawmakers have highlighted the number of judges with extremely high rates of granting benefits and some cases of outright fraud. While the Government Accountability Office has found that fraud in the program is low, the Obama administration in its budget suggested more frequent reviews of existing beneficiaries.
One of Republicans' first moves this year was to rule out the straightforward solution to the immediate problem of the trust fund's insolvency favored by Democrats, namely reallocating payroll taxes from the Social Security retirement fund to the disability fund. That maneuver, which has been done a number of times in the past, would make the combined funds solvent through 2033, but House Republicans wrote a rule prohibiting it unless steps were also taken to shore up Social Security’s overall finances.
Next, Republicans scheduled hearings on the subject. Rep. Sam Johnson, R-Texas, said the House Ways and Means Social Security subcommittee he heads will hold a hearing on disability insurance Wednesday to “start the much-needed conversation on responsibly addressing the looming insolvency” of the program.
Sen. Mike Enzi of Wyoming, chairman of the Senate Budget Committee, held a hearing on the program last week. During the hearing, Enzi called the approaching exhaustion of the trust fund a “crisis” and chastised President Obama for not acting, saying that “his effort to paper over the problem is a classic example of Washington ducking a real American need.”
But Enzi’s own prescriptions didn't go beyond saying that disabled beneficiaries “deserve a long-term solution so that the program doesn’t once again flirt with disaster.”
The GOP’s moves have elicited stark warnings from Democrats, for whom former President George W. Bush’s attempt to partially privatize Social Security’s retirement program is a fresh memory.
Sen. Bernie Sanders, the self-identified Vermont socialist who is Enzi’s counterpart on the Budget Committee, said Republicans are “manufacturing a phony crisis in Social Security in order to cut the earned benefits of millions of the most vulnerable people in this country.”
The reality is that there will have to be a reallocation of the payroll tax to the disability fund, or some other funding increase, before 2016. The timeline is too short for the kinds of long-term changes many economists have said are needed to overhaul the program to address its rapidly increasing size and cost.
Nevertheless, Republicans and some experts believe that the time is now to insist on major changes, with the program having grown to 11 million beneficiaries and accounting for about $145 billion in spending annually, or about as much as the Departments of State, Education and Homeland Security combined.
“The right time to have this debate would have been 20 years ago,” said Marc Goldwein, senior policy director at the Committee for a Responsible Federal Budget, a nonprofit group that advocates for smaller deficits and debt.
In 1994, Goldwein noted, Congress passed legislation authorizing a reallocation of payroll taxes under the logic that it would buy time to address the underlying issues that were leading more workers to go on the disability rolls and increase spending on the program. Twenty years later, however, Congress still hasn’t acted.
Just how large a change Republicans want now remains to be seen. They could set a numerical target: Enzi suggested that it would take $352 billion to fully replenish the trust fund to pay out all claims over the next 10 years.
That amount is not likely to materialize. One of the few pieces of legislation introduced by Republicans, a bill to prevent people from “double dipping” with disability benefits and unemployment insurance, would save just $2 billion over 10 years. That measure was introduced by Senate Finance Committee Chairman Orrin Hatch, Johnson, and Ryan.
The most likely outcome, said Goldwein, is a payroll tax reallocation, "accompanied by changes that move in the direction of reform, but don’t really solve the financial issues or the broader issues people are concerned about.” That could include demonstrations or trial projects meant to test reform alternatives.
"I think there are going to be some temporary financing transition measures that will have to be probably included in this, but our goal is to improve the viability of the program and bring it into the 21st century," Ryan said.
http://www.washingtonexaminer.com/gop-plans-overhaul-for-social-security-disability/article/2560440
