Beneficiaries
Number and Trends
At the end of 2020, there were 9.7 million Americans receiving benefits from the SSDI program. This included 8.2 million disabled workers, 1.4 million children of disabled workers, and 0.1 million spouses of disabled workers.https://www.ssa.gov/legislation/2021FactSheet.pdf Children and spouses are sometimes referred to as auxiliary beneficiaries because they receive benefits based on their relationship to a disabled worker, not because they are necessarily disabled. The number of beneficiaries grew rapidly between 1990 and 2010 before leveling off and then declining in recent years. Two schools of thought developed to explain the rapid growth in the program during the 1990s and early 2000s. According to David Autor andCharacteristics
Social Security disability beneficiaries have high poverty rates relative to other Social Security beneficiaries. About 24 percent of disabled workers have family income below the official poverty level in the United States compared to only 7.1 percent of retired workers (the largest group of Social Security beneficiaries). About 31 percent of disabled widow(er) beneficiaries and 36 percent of disabled adult children are poor. In total, 2.4 million disabled worker, widow(er), and adult child beneficiaries are poor. In addition, about 38 percent of Social Security disability beneficiaries experience material hardship, defined as having low or very low food security or an inability to pay utility bills or housing costs. About 72 percent of Social Security disabled workers are between the ages of 50 and 66 and about 28 percent are under the age 50 (at Social Security's "full retirement age" (currently age 66), the Social Security Administration reclassifies disabled workers as retired workers). Twenty-four percent of disabled workers are African American. As expected from a program that is restricted to persons with severe disabilities, Social Security disability beneficiaries, relative to the general working age population in the United States, have very high rates of health problems and very high rates of hospitalization and medical visits. The work capacity of Social Security disability beneficiaries has been the subject of several studies and policy debates. Some have argued, despite their impairments, many disabled beneficiaries could return to work whereas others have argued the work capacity of Social Security disability beneficiaries is very limited due to the wide distribution of severe health problems among the population.Monthly benefit amounts
In 2019, the average monthly benefit amount paid to disabled workers was about $1,260. Approximately 36 percent of disabled workers received a monthly benefit that was under $1,000. The monthly benefit amount a disabled worker receives depends on the person's earnings in Social Security covered employment prior to becoming disabled. For each disabled worker, a Primary Insurance Amount (PIA) is computed that depends on the worker's past earnings, wage growth in the economy prior to the worker's disability onset, and a benefit formula that gives greater relative weight to low earners. The disabled worker receives a benefit equal to 100 percent of the PIA. An eligible spouse or child can receive 50 percent of the PIA as a benefit amount but total payments to a family are subject to a maximum. Monthly benefits in the Social Security program have three general features. They replace a larger share of past earnings for low earners and they are increased with price inflation once a person is on the benefit rolls. Initial benefits are computed using wage indexing, which allows for initial benefits to reflect wage growth in the economy that occurred during the worker's career. Monthly benefit amounts for disabled adult children depend on the earnings in Social Security covered employment of the retired, disabled, or deceased parent and amounts for disabled widow(er)s depend on the earnings of the deceased spouse.Application, Initial Determination, and Appeals
Application
An application must be filed with the Social Security Administration (SSA) before an individual can receive SSDI. Individuals can apply for SSDI by: * Calling SSA's national toll-free number (1-800-772-1213) or * Contacting a local Social Security office or * Submitting an online application SSA will determine whether the applicant is "insured" for Social Security disability benefits. Generally, this depends on whether the applicant has worked "long enough – and recently enough - and paid Social Security taxes" on earnings. With regard to disabled widow(er) or disabled adult child Social Security benefits, however, the applicant does not have to be insured based on the individual's own employment history. Rather, in those cases, the deceased spouse or the parent of the disabled adult child must have worked in Social Security employment and achieved the required insured status. SSA will also determine whether the individual is performingInitial Determination
The decision about disability is based on a sequential evaluation of medical and other evidence. The sequence for adults is: :1. Is the applicant performingAppeals
In fiscal year 2020, state DDSs denied 61 percent of initial claims.https://www.ssa.gov/budget/FY22Files/FY22-JEAC.pdf SSA provides for three levels of administrative appeal if an applicant is initially denied by a state DDS. At the first level, the applicant may request a reconsideration of the initial decision. In the reconsideration, a different DDS examiner will review the case. If the claim is denied at this stage, the applicant can request a hearing before an Administrative Law Judge (ALJ). ALJs are not state employees but rather federal employees of the Social Security Administration. If the claim is denied at this stage, the applicant can request a review of the case by the Appeals Council of the Social Security Administration. Administrative appeals are non-adversarial and new evidence can be submitted by the applicant. After an applicant has exhausted the administrative appeals process, the individual may appeal the case to the federal courts. Federal court findings may pertain to the individual case, but may also result in required changes in SSA's policies and procedures if the court concludes those policies and procedures do not conform to federal law or the U.S. Constitution.Legal representation
Applicants may hire a lawyer or non-attorney representative to help them apply or appeal. There are two primary types of organizations: companies with trained specialists experienced in handling SSDI applications and appeals in some or any local community across the country and law firms which specialize in disability-related cases. Most SSDI applicants—about 90 percent according to the SSA—have a disability representative for their appeal. An August 2010 report by the Office of Inspector General for the Social Security Administration indicated that many people submitting an initial disability application for SSDI might benefit from using a third-party disability representative when they first apply for benefits. It indicated that having a disability representative earlier in the process significantly improves the chances of those with four major types of disabilities getting approved for SSDI. The fee that a representative can charge for SSDI representation is set by law and is limited to 25 percent of the retroactive SSDI benefits awarded. While some representatives may charge fees for costs related to the claim, such as photocopy and medical record collection expenses, the vast majority of disability attorneys and representatives do not charge a fee unless they win the case. Prior to 1991, social security administration regulations required attorneys and representatives to submit a "Fee Petition" itemizing time spent on the matter. The SSDI applicant had the opportunity to agree or object to the fee requested, and the social security decision-maker often approved less than the full fee amount requested by the attorney/representative. In 1991 the social security administration implemented the "Fee Agreement" process. If the attorney/representative contract limited the fee to no more than $4000, a detailed review and approval of time spent on the case via the "Fee Petition" process was no longer required. Social security regulations require that the fee agreement conform to specific standards. This attorney fee cap for the "Fee Agreement" process was increased to $6000 effective June 22, 2009. Because of the reduced administrative burden afforded by the "fee Agreement" process, and the time delay for approving and disbursing fees under the "Fee Petition" process, the majority of disability lawyers and representative primarily use the "Fee Agreement" process. If an SSDI applicant is approved quickly and does not receive a retroactive award, the SSA must review and approve the fee a representative will charge the individual. Disability representatives do not charge a fee if they are unsuccessful in obtaining a claimant's disability benefit. Representatives may decline to represent you if, after reviewing your situation, they do not believe you are likely to meet the requirements for SSDI. Most representatives will provide this screening at no cost to you. Typical reasons individuals do not meet the requirements are: their disability is not severe enough or the applicant does not have a sufficient work history (and did not pay enough into FICA - theWait time for decisions and hearings
The amount of time it takes for an application to be approved or denied varies, depending on whether it is an initial decision or a decision based on an appeal. In fiscal year 2019, it took an average of 120 days for SSA to make an initial determination on a disability claim. The figure increased following the COVID-19 pandemic and, for months in fiscal year 2021, the average wait time for an initial decision is 165 days. The high number of cases and long wait times for a hearing before an Administrative Law Judge has drawn significant attention from Congress in recent years. Congress provided additional funding for this workload and the number of cases and wait times have declined. In fiscal year 2020, the average wait time for a hearing was 386 days (down from 605 days in fiscal year 2017). For some cases, SSA will expedite disability determinations. These include Quick Disability Determination (QDD) and Compassionate Allowance cases. These are cases where statistical models or medical diagnoses indicate the person has an extremely severe medical condition. These cases can often be processed in under 30 days. Additionally, many cases involving military veterans are expedited. Congressional concern over wait times has focused, to some extent, on the number of individuals who die or become bankrupt while waiting for a disability determination. The Government Accountability Office (GAO) found that from fiscal year 2014 through fiscal year 2019, about 48,000 individuals filed for bankruptcy while awaiting a final decision on their disability appeal and, for fiscal year 2008 through fiscal year 2019, about 110,000 individuals died prior to receiving a final decision regarding their appeal.Likelihood of receiving benefits
Considering all levels of adjudication, about 4 in 10 SSDI applicants are awarded benefits. Slightly more than 50 percent of applicants who meet technical requirements of eligibility are determined to be medically eligible. The number of cases and percentage allowed at each stage of adjudication for all types of disability cases in fiscal year 2020 are as follows:Denied Applicants
One study found that 12.4 million Americans or about 6.2 percent of the U.S. population ages 18–66 are denied SSDI applicants. The study also found these individuals had high rates of health problems and a high rate of hospitalization compared to the general population. About 52 percent of denied applicants reported difficulty standing for one hour compared to about 5 percent for the general population. About 21 percent of denied applicants were hospitalized during the year compared to about 6 percent for the general population. Denied applicants had a high poverty rate (38 percent) and a high rate of material hardship (43 percent). Material hardship was measured as having low or very low food security or an inability to pay utility or housing costs. A baseline study of denied SSDI and SSI applicants who sought benefits on the basis of mental impairments found denied applicants had low-income and had "multiple mental health and general medical conditions, low quality of life, and low functional ability." The baseline population is composed of individuals who are part of the Social Security Administration's Supported Employment Demonstration. The goal of the demonstration is to test whether employment support and health interventions can improve outcomes for denied applicants.Payee assignment
Generally, the person qualifying for benefits is determined to be capable of managing their own financial affairs, and the benefits are disbursed directly to them. In the case of persons who have a diagnosed mental impairment which interferes with their ability to manage their own finances, the Social Security Administration may require that the person assign someone to be their representative payee. This person will receive the benefits on behalf of the disabled individual, and disburse them directly to payers such as landlords, or to the disabled person, while providing money management assistance (help with purchasing items, limiting spending money, etc.). The representative payee often does not charge a fee for this service, especially if it is a friend or relative. Social service agencies who are assigned as payee are not prohibited from charging a fee, although the maximum fee is set by Social Security. The fee is the same for ALL recipients, except it can be larger for those with severe substance abuse problems (Social Security determines when a higher fee can be charged, not the representative payee.) Some states and counties have representative payee agencies (also called substitute payee programs) which receive the benefits on behalf of the disabled person's social worker, and disburse the benefits per the social worker's instructions. A payee can be very helpful in the instance of homeless individuals who need assistance paying down debts (like utility bills) and saving for housing. About 10 percent of disabled worker beneficiaries have representative payees and about 5 percent of disabled widow(er)s have representative payees. The figure is much higher for disabled adult children, with about 73 percent of these Social Security beneficiaries having representative payees.Regulatory changes
The "treating physician rule" gave "controlling weight" to determinations of the treating physicians.(2013)Related programs
Regardless of a person's age, after receiving SSDI benefits for 24 months, they are eligible for Medicare, including Part A (hospital benefits), Part B (medical benefits), and Part D (drug benefits). The date of Medicare eligibility is measured from the date of eligibility for SSDI (generally 6 months after the start of disability), not the date when the first SSDI payment was received. Individuals receiving SSDI may qualify forImpact
According to a 2021 study, which used variation induced by an age-based eligibility rule as a way to draw causal inferences, SSDI substantially reduced the financial distress of disabled individuals. The study finds that SSDI "reduces the likelihood of bankruptcy by 20 percent, foreclosure by 33 percent, and home sale by 15 percent."References
Further reading
*External links
* ttp://www.ssa.gov/disability/ Disability Programs Social Security Administration