The Rising Cost of Social Security Disability Insurance

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Executive Summary

Social Security Disability Insurance (SSDI) isone of the largest federal programs, and it is oneof the most troubled. The programs expendi-tures have doubled over the last decade, reach-ing an estimated $144 billion this year. Spend-ing has risen so rapidly that SSDIs trust fundis projected to be depleted just three years fromnow.

SSDI was originally created as a modest safe-

ty net aimed at severely disabled workers whowere close to retirement age. But Congress hasexpanded benefit levels over the decades, and el-igibility standards have been greatly liberalized.The result is that people capable of working areinstead opting for the disability rolls when con-fronted with employment challenges. Once onthe disability rolls, experience shows that indi-viduals are likely to remain there, which is badfor the individuals, taxpayers, and the economy.

The process for determining eligibility fordisability insurance benefits has become a bu-

reaucratic nightmare. Applicants often pursue

a lengthy and litigious appeals process if theirinitial applications are denied. And there is agrowing reliance on subjective considerationsin evaluating claims, which has exacerbated thedifficult task of determining whether an indi-vidual is truly disabled. Specialty law firmsworking on a contingency fee basis have takenadvantage of the complex system and its incon-sistencies to reap a financial bonanza at taxpay-

er expense.Instead of providing a wage-replacement

backstop for the disabled workers who are per-manently incapable of working, disability in-surance has become more like permanent un-employment insurance or a general welfareprogram. SSDI has become financially unsus-tainable and economically damaging, and poli-cymakers should pursue major spending cuts tothe program. They should also explore the po-tential to transition responsibility for disabilityinsurance from the government to the private

sector.

The Rising Cost ofSocial Security Disability Insurance

by Tad DeHaven

No. 733 August 6, 2013

Tad DeHaven is a budget analyst on federal and state budget issues for the Cato Institute.


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Policymakershave liberalized

eligibilitystandards for

SSDI repeatedlyover the decades,

with the resultthat many people

who are capableof working

choose instead toremain idle andreceive benefits.

Introduction

The goal of the federal Social SecurityDisability Insurance (SSDI) program is toreplace a portion of a workers income in the

event that he or she is unable to work as aresult of a severe disability. The program issupposed to provide support to people whocannot work because they have a medicalcondition that is expected to last at least oneyear or result in death.

The number of people enrolled in SSDIhas expanded rapidly in recent years, even asthe share of the U.S. working-age populationreporting a severe disability has remainedstable.1 In addition, medical advances haveaided people with disabilities and fewer

workers are engaged in hard physical labor.The number of SSDI beneficiaries jumpedfrom 4.3 million in 1990, to 6.7 million in2000, to 10.9 million in 2012.2 The ratio ofSSDI beneficiaries to all working-age peoplehas doubled in the last two decades.

Accordingly, the taxpayer costs of SSDIhave ballooned. Figure 1 shows that totalspending will have doubled from $72 billion

in 2003 to an estimated $144 billion in 2013.3

In real (inflation-adjusted) dollars, SSDI ex-penditures will have roughly doubled since2000. SSDIs benefits are funded by a 1.8percent tax on workers wages as part of the

broader Social Security tax, but because ben-efit payments are outpacing tax revenues thesystem is running deficits and the SSDI trustfund will be exhausted by 2016.4

The growing numbers of people on dis-ability is also increasing Medicare spendingbecause SSDI recipients qualify for the fed-eral health program. Medicare benefits forSSDI recipients cost the government about80 percent as much as the SSDI benefitsthemselves, which translates to more than$100 billion a year in further taxpayer costs.5

Policymakers have liberalized eligibil-ity standards for SSDI repeatedly over thedecades, with the result that many peoplewho are capable of working choose insteadto remain idle and receive benefits. That isnot only bad for taxpayers, but also for thebroader economy because skilled and pro-ductive people are being lured into long-term government dependency.

$56$61

$66$72

$79$86

$94$100

$107

$118$126

$132$139

$144

0

50

100

150

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Figure 1Social Security Disability Spending

Source:Budget of the U.S. Government, Fiscal Year 2014, Historical Tables, Table 13.1.

Fiscal Years

Bil

lionso

fDo

llars


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Once establishedfederal subsidiefor the disabledincreased steadiover the decadesas policymakersthought of newways to expandbenefits.

The liberal eligibility rules for SSDI, theexpansion of benefits, and the systems per-missive court rulings have made the pro-gram rife with abuses. Many individualswho could be gainfully employed are receiv-

ing government support and not workingbecause the system is tilted in favor of pro-viding benefits to new applicants. Indeed,the system has a multi-level appeals pro-cess that enables people with questionableclaims to succeed in winning benefits if theyare persistent.

This study describes the history of SSDIand the structure of the program today. Itexplains how the complex process of deter-mining eligibility has become an adminis-trative nightmare, and it discusses the evi-

dence that many people capable of workingare using SSDI as essentially a permanentunemployment or welfare program, which itwas not intended to be.

With todays huge federal deficits, tax-payers simply cant afford the skyrocketingexpenditures for this $144 billion federalprogram. In the short term, policymakersshould pursue cuts to sharply reduce theprograms high price tag. In the long run,policymakers should explore possible pathsto phasing out the system and leaving the

provision of long-term disability insuranceto private markets.

A Brief History of SSDI

When the Social Security system was cre-ated in 1935, disability insurance was notincluded.6 A federal program for disabilitybenefits was considered in the 1930s, butmany policymakers thought that it wouldbe too expensive and that disability subsi-

dies would create an incentive for people todrop out of the workforce.7

However, there was growing supportamong federal officials for a government dis-ability program. The Social Security Board(renamed the Social Security Administrationin 1946) actively advocated in favor of add-ing benefits for the disabled.8 Supporters

believed that a nationalized disability systemwould be more efficient than the existingprivate system. But private disability insur-ance providers at the time argued that thepolitical system would lack the discipline

to manage a federal program efficiently. In-surance executive M. Jarvis Farley said: Theprofit motive provides that discipline in aprivate organization . . . but I know of nosubstitute in government administration. Ibelieve that a government would fail to obeythe moral hazard.9 Sadly, Farley turned outto be right, as the exploding growth in SSDIhas made clear.

In 1943 legislation was introduced toexpand federal social insurance to includetemporary and permanent disability bene-

fits, as well as unemployment compensationand health insurance.10 This legislationtheWagner-Murray-Dingell billnever made itout of committee.11 After that, World WarII put efforts to introduce federal disabilityinsurance on hold. Also, a major obstacleto the creation of federal disability insur-ance was the American Medical Association,which opposed any steps that it believedwould lead to nationalized health care.12

In 1948 a Social Security Advisory Coun-cil recommended to Congress a plan to ex-

tend benefits to the permanently disabled.13Based on the Councils recommendation,the House added disability coverage topending Social Security legislation in 1949,but this plan was rejected by the Senate. In-stead, the upper chamber supported federalgrants to the states for assistance to the dis-abled, and this approach was signed into lawin amendments to Social Security in 1950.14Once established, federal subsidies for thedisabled increased steadily over the decadesas policymakers thought of new ways to ex-

pand benefits. In 1954 policymakers createda disability freeze on Social Security ben-efits, which allowed workers to omit periodsof disability from the calculation of their re-tirement benefits.15

In 1956 SSDI was born when Social Secu-rity was amended to create a federal disabil-ity insurance program. Initially, the program


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It isnt possibleto determine withprecision whether

an applicant istruly unable to

work, or whetherthe disability is

temporary orpermanent.

was just for individuals between the ages of50 and 65 who had a substantial work his-tory. Children who were disabled before theage of 18 and who were dependents of a re-tired or deceased worker were also eligible.16

The benefits were financed by a 0.5 percentpayroll tax on the wages of workers in theSocial Security system. President DwightEisenhower initially opposed the legisla-tion, which was engineered by congressionalDemocrats and Social Security Adminis-tration (SSA) officials. In the end, however,Eisenhower signed the bill.17

Under SSDI, an individuals initial appli-cation for benefits was made at a local SocialSecurity office. However, the determinationas to whether an individual was severely dis-

abled and unable to engage in substantialgainful activity was determined by a stategovernment office.18 State involvement inthe new disability program was needed to al-lay concerns from doctors and others aboutthe growing size and scope of the federalwelfare state.19

Those concerns proved well founded asSSDI began to expand. In 1958 the programwas broadened to include the dependents ofthe disabled. In 1960 age restrictions were re-moved and benefits were extended to people

of all ages.20 In 1965 the qualifying determi-nation for disability was liberalized. Previ-ously, an individuals disability had to be oflong-continued and indefinite duration. 21But under the new rules, a worker becameeligible for benefits if the disability was ex-pected to last just 12 months or longer.

In 1967 Congress adopted a more precisedefinition of disability, partly in response toconcerns about rising program costs.22 Butthe new rules actually expanded eligibility incertain ways, and efforts to bring more rigor

and uniformity to the disability definitionwere hindered by inconsistent administra-tion by the states.

That same year SSDI was expanded again,this time by adding in benefits for disabledwidows. In 1972 policymakers reduced thewaiting period for SSDI benefits and ex-panded the definition of eligible disabled

children. They also extended Medicare ben-efits to SSDI recipients.23

Also in 1972, policymakers created a sisterprogram for SSDI called Supplemental Secu-rity Income (SSI). In general, SSDI provides

benefits for individuals with work historieswhile the new SSI program was designed toprovide benefits for low-income elderly anddisabled people without substantial workhistories. In 2011, 16 percent of SSDI ben-eficiaries also received SSI benefits.24 SSI isfunded by general federal revenues.

SSDI expanded rapidly during the 1970sIn constant 2012 dollars, the programsannual cost soared that decade from $14billion to $38 billion. The SSA points to acombination of factors that fueled the cost

increases during that period:

[H]igh unemployment rates; chang-es in attitude toward disability; highbenefit levels that encourage personswith impairments to stop workingand apply for benefits; and variousadministrative factors, such as themassive nature of the disability deter-mination process, tremendous pres-sures for timely processing of claims,disparity in adjudication among the

States and at different levels of admin-istrative review, and other factors.25

A federal official who was involved withdefining disability noted that disability isan elastic concept, which is the root of alot of cost problems.26 It isnt possible todetermine with precision whether an appli-cant is truly unable to work, or whether thedisability is temporary or permanent. Thisproblem is illustrated by the wide variancein SSDI benefit claims in different regions

of the country and under different adminis-trative law judges (ALJs), as discussed below

The problem is also illustrated by the rap-id expansion of SSDI during periods of highunemployment, such as during the 1970sand recent years. More people dont actu-ally become disabled during recessions, butmany more decide to try to claim disability


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While SSDIenrollment andcost growth hadslowed during

the early 1980s,by the late-1980senrollment andcosts were risingagain and havecontinued torise rapidly andnonstop sincethen.

in order to receive federal benefits.By the 1980s, SSDI was a freight train

out of control. An official history says thatthe disability rolls were substantially larg-er than had been anticipated and that the

massive nature of the programs complexadministration was creating serious prob-lems.27 In 1978 President Jimmy Carterssecretary of health, education, and welfare,Joseph Califano, called SSDI a caricatureof bureaucratic complexity.28 According toCalifano, the program had drifted into cri-sis and was in urgent need of fundamentalreassessment and overhaul.

President Carter tried to solve some ofthose problems and signed reform legisla-tion in 1980 that tightened benefits in vari-

ous ways.29

One provision required that stateadministrators reexamine non-permanent-ly disabled beneficiaries once every threeyears to see if they were able to reenter theworkforce. Prior to this requirement, littlewas done to remove able-bodied people fromthe SSDI rolls. The Government Account-ability Office (GAO) estimated at the timethat one in five recipients was no longer eli-gible for disability benefits.30 The SSA esti-mated that the figure was one in four.31

Following the Carter administrations

lead, the incoming Ronald Reagan adminis-tration initially focused on trimming SSDIcosts. However, a political backlash eruptedwhen newspapers began reporting horrorstories about individuals who had theirdisability benefits terminated. Some mem-bers of Congress pounced on the stories andheld dozens of hearings to highlight them.32Also, the attempted removals from SSDI ledto a growing number of appeals to ALJs, andultimately rising backlogs of cases. Soonstate administrators of SSDI joined the

rebellion against the Reagan administra-tions attempt to prune the rolls and manystopped reviewing beneficiary eligibility.33

The backlash led to the Social SecurityDisability Benefits Reform Act of 1984,which effectively reversed the 1980 reforms.The 1984 law required the SSA to developnew standards, which ultimately led to loos-

er eligibility requirements. As one example,the new rules allowed people to gain SSDIbenefits if they had numerous nonsevere dis-abilities that, combined, reduced their workcapacity, rather than having a single severe

impairment.

34

Economist David Autor not-ed of the 1984 changes, A key consequencewas that applicants with difficult-to-verifydisorders such as muscle pain and mentaldisorders could more easily qualify for ben-efits.35

According to social insurance historianEdward Berkowitz:

Although billed as a reform, there-fore, the 1984 law stopped the longer-run reform process cold. Concern had

shifted from containing the futurecosts of the system to protecting thepresent rights of the disabled. Whereonce policy highlighted the growth ofthe rolls, it now centered on protect-ing the rights of people already on therolls . . . Where once reform soughtto streamline disability determination,more bureaucracy was now added tothe system through such measuresas face-to-face reconsideration hear-ings.36

While SSDI enrollment and cost growthhad slowed during the early 1980s, by thelate-1980s enrollment and costs were risingagain and have continued to rise rapidly andnonstop since then.

SSDI Basics

SSDI is administered by the SSA, whichhas over 65,000 employees and over 1,300 of-

fices across the nation.37 As previously noted,the program is financed by a 1.8 percent pay-roll tax on all covered workers in the SocialSecurity system. That tax rate is more thantriple the rate of 0.5 percent when SSDI wasfirst established.38 The tax is applied to earn-ings up to a certain level ($113,700 in 2013).Unlike unemployment insurance or workers


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The real, orinflation-

adjusted, costsof SSDI have

exploded over thelast two decades.

compensation, employers pay the same taxrate regardless of how much their employeesutilize the system.

The programs finances are accounted forin the federal budgets SSDI trust fund. Theaccounts of the trust fund show that the pro-grams expenditures are expected to be $144

billion in 2013, of which about $141 billion isfor the payment of benefits and $3 billion foradministrative expenses.39 As Figure 2 shows,the real, or inflation-adjusted, costs of SSDIhave exploded over the last two decades.

In 2013 the SSDI trust fund is expected totake in $111 billion in revenue, and thus thefund would have a deficit of $33 billion.40Deficits are financed by redeeming nonmar-ketable government securities that were ac-cumulated over the years when the programhad a surplus. The government spent the

surpluses on other government programsand credited the fund with the securities. Be-cause the securities are simply IOUs (mean-ing they are not invested in assets that willproduce future financial returns), they haveto be redeemed with the use of general fed-eral revenues when a program deficit occurs.The trust fund has been running annual def-

icits since 2009. Those deficits are projectedto persist and the trust fund is scheduled tobe exhausted in 2016.41 In present value, theSSDI trust fund has an unfunded liability of$1.2 trillion over a 75-year horizon.42

There are currently 10.9 million Ameri-cans collecting SSDI benefits.43 Of that total

8.8 million are disabled workers and 2.1 mil-lion are spouses and children. The averagemonthly benefit, which depends on a work-ers earnings history, for a disabled workeris $1,130.44 To be considered disabled, aworker must possess the inability to engagein any substantial gainful activity by reasonof any medically determinable physical ormental impairment which can be expectedto result in death or which has lasted or canbe expected to last for a continuous periodof not less than 12 months.45 As will be dis-

cussed, however, this definition is often sub-jectively applied.

Soaring Expenditures

The growing number of people on SSDIhas led to an explosion in expenditures since

0

50

100

150

1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

Figure 2Social Security Disability Spending

Fiscal Years

Bil

lionso

f2013Do

llars

Source:Budget of the U.S. Government, Fiscal Year 2014, Historical Tables, Table 13.1.


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Whenunemploymentis rising,applications for

SSDI tend toincrease, while astrong economycoincides withfewer SSDIapplications.

the late 1980s. That increase has occurredeven though the share of the U.S. working-age population reporting a severe disabilityhas remained stable over the years.46 Fur-thermore, the share of the working-age pop-

ulation that reports having a work-limitinghealth condition has remained steady overtime.47 In addition, medical advances haveenhanced the ability of people with disabili-ties to function in many workplaces, and theeconomy has become less reliant on labor-intensive blue-collar jobs.

With this good news about Americanshealth, one would think the ratio of SSDIrecipients to working-age population wouldhave remained stable or fallen over time.Instead, as Figure 3 shows, there has been a

large increase in the ratio of SSDI recipientsto active workers. This ratio has doubledsince the early 1990s, which is a remarkabledevelopment.

If Americans are not becoming less ableto work because of health problems, whyare the disability rolls increasing? Econo-mists David Autor and Mark Duggan notethat the rapid growth of Disability Insur-ance does not appear to be explained by atrue rise in the incidence of disabling illness,

but rather by policies that increased the sub-jectivity and permeability of the disabilityscreening process.48 Similarly, economistRichard Burkhauser calls the explosion inthe number of people gaining federal dis-

ability benefits a policy-driven epidemiccaused by rule changes that have made it fareasier to gain entry to these benefit rolls.49

Evidence of this stems from the fact thatthere have been large increases in SSDI ap-plications when the economy is poor, ashas been the case in recent years. As Figure4 shows, when unemployment is rising, ap-plications for SSDI tend to increase, while astrong economy coincides with fewer SSDIapplications. Marginally disabled people whocould perform work may decide to try for

disability benefits when employment condi-tions deteriorate. Indeed, a recent study onthe work disincentive effects of SSDI foundthat employment of the marginal programentrant would be on average 28 percentagepoints greater in the absence of SSDI benefitreceipt two years after the initial determina-tion.50

The inability to define disability preciselyhas thus resulted in a program that partlyacts like permanent unemployment insur-

0

10

20

30

40

50

60

70

80

1970 1975 1980 1985 1990 1995 2000 2005 2010

Figure 3Disability Recipients per Thousand U.S. Workers

Disa

bilityRecipientsperT

housan

d

U.S.

Workers

Source: Social Security Administration and Bureau of Labor Statistics.


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Unlikeunemploymentbenefits, which

are fixed induration, a

person who goeson the disability

rolls can staythere indefinitely.

ance or welfare. One problem with that isthe longer an individual remains out ofwork on SSDI, the more difficulty that per-son will experience in finding employmentlater on.51 Unlike unemployment benefits,which are fixed in duration, a person whogoes on the disability rolls can stay there in-

definitely. Indeed, that is typically the case.The Congressional Budget Office projectsthat as a result of the most recent recession,the number of disability insurance benefi-ciaries will continue to rise over the next fewyears by more than otherwise would have oc-curred, contributing to the long-term trendof rising enrollment already under way.52

Policymakers have fueled rising enroll-ment by embracing ever more liberal eligibil-ity standards for SSDI. Originally, the ideawas that people would only be eligible for

SSDI if they could not work at all, but todaythe standards for ability to work are muchlooser. For example, after Congress relaxedeligibility standards in 1984, awards basedon nonexertional restrictionsa mentalcondition such as depression or physicalpain stemming from a musculoskeletal con-ditionjumped 323 percent in the subse-

quent 20 years.53 Today, the majority of ap-plicants who are awarded benefits by an ALJare determined to possess a nonexertionalrestriction.54

Law professor Richard Pierce explainsthat it is practically impossible to prove thatthese conditions constitute a complete in-

ability to work:

There are no objective diagnostic crite-ria that can be used to verify or refutea claim that an individual has a nonex-ertional restriction. Moreover, all suchrestrictions are matters of degree. TheSocial Security Act renders an individ-ual eligible for disability benefits onlyif he has an impairment of such sever-ity that he . . . cannot . . . engage in any. . . kind of substantial gainful work

which exists in the national economy.Yet, there are no objective diagnosticcriteria that can be used to measurethe degree of an applicants anxiety,depression, or pain. Finally, nonexer-tional restrictions are ubiquitous. TheNational Institute of Medicine hasfound that 116,000,000 Americans

-25%

-15%

-5%

5%

15%

25%

35%

45%

55%

65%

1970 1975 1980 1985 1990 1995 2000 2005 2010

Disability Applications U.S. Unemployment Rate

Figure 4Percent Change in Disability Applications and in U.S. Unemployment Rate

Source: Social Security Administration and Bureau of Labor Statistics.


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SSDI is moreand more like ageneral welfareprogram, not a

last-resort safetynet for the smallgroup of peoplecompletelyunable to earna living becauseof a medicaldisability.

suffer from chronic pain, while theNational Institute of Mental Healthhas found that 61,000,000 Americanssuffer from mental disease. It is arare person who reaches my age (68)

without having experienced anxiety,depression, and/or pain over some sig-nificant periods of time. Thus, at somepoint in his life, almost every personcan make a plausible claim of eligibil-ity for permanent disability benefitsbased on nonexertional restrictions.55

Pierce blames ALJs for helping to pushup the costs of the SSDI system.56 A singlejudge in Pennsylvania, for example, over-ruled the SSA on 2,285 benefit applications

in a four-year periodapplications that theSSA had declined. That single judges ac-tions have cost taxpayers more than $2 bil-lion.57 Another SSDI expert, James Taylor,thinks that another problem is the deep in-stitutional bias within the SSA that encour-ages favorable determinations at every levelof the process.58 For one thing, SSA benefitawards are generally not open to public scru-tiny, so officials are likely biased to be gener-ous to applicants out of sympathy, ratherthan feeling accountable to taxpayers. The

result of all this is that SSDI is more andmore like a general welfare program, not alast-resort safety net for the small group ofpeople completely unable to earn a living be-cause of a medical disability.

A Complex and SlantedProcess

The SSDI application process beginswhen workers submit paperwork to a local

SSA office. The office determines if the ap-plicant has worked long enough to be con-sidered insured under SSDI and is notcurrently earning above the substantialgainful activity limit ($1,011 a month in2012). If the applicant meets those require-ments, a state Disability DeterminationService (DDS) then follows a step-by-step

process to determine whether the workersmedical condition warrants disability bene-fits. At any step, the applicant can be deniedbenefits.

The DDS first decides whether the dis-

ability is severe enough to limit basic life ac-tivities. If the answer is yes, a determinationis made as to whether the disability meets oris the equivalent of a condition in the SSAsListings of Impairments. If the answeris yes, the applicant qualifies for benefits.If the answer is no, the applicant may stillqualify for benefits after some additionalsteps: First, the DDS determines whetherthe applicant can perform work from anyprevious occupations. If the answer is no,the DDS determines whether the applicant

can perform other work that exists in thenational economy. If the answer is no again,the applicant qualifies for benefits.

The SSA first introduced Listings of Im-pairments in 1968 in order to expedite theclaims process. There are 14 categories orga-nized by major body systems. When subcat-egories are included, the list of impairmentsexceeds 100.59 However, the share of initialclaims allowed based on the listings hasdropped from 93 percent in the early years toaround 50 in the past decade.60 Nowadays,

the Medical-Vocational Guidelines, used inthe final evaluative step, are four times morelikely to determine eligibility.61 The SSA hasdeveloped a grid containing more than 80options that take into consideration factorssuch as age, education, and the ability toperform some level of work. The Grids al-low for more subjective considerations whendetermining eligibility, which has resultedin people being declared disabled who areactually capable of performing work or whohave a disabling condition that has a good

chance of being temporary.62

Applicants who are approved becomeeligible to receive benefits five months fromthe time the disability began.63 In addition,successful SSDI applicants can also startreceiving Medicare health coverage after 24months. The Congressional Budget Officesays that Medicare benefits cost the federal


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The data thusindicate that

once workers geton the disabilityrolls, they rarely

leave and go backto work.

government on average more than 80 per-cent as much as their [disability insurance]benefits, which translates to more than$100 billion in 2012.64 Disability benefitscontinue until the individual reaches nor-

mal Social Security retirement age, at whichpoint he is covered by regular Social Secu-rity, or the individual is able to resume work.

The SSA conducts periodic reviews to de-termine if a beneficiary is still disabled. Thefrequency of the reviews depends on howlong an individuals condition is expected tolast. In 2011, only 3.6 percent of workers onSSDI had their benefits terminated becauseof medical improvement. Almost 90 percentof people had their benefits stopped becausethey either died or reached retirement age.65

The data thus indicate that once workers geton the disability rolls, they rarely leave andgo back to work.

Applicants who are denied benefits canappeal. Indeed, the appeals process hasfour levels, and at each level the individualreceives another chance to convince a gov-ernment official or judge to grant benefits.Thus, individuals with questionable claimsof disability have up to five tries at receivingbenefits and they just have to succeed once.

The process can be very cumbersome and

costly. A rejected applicant can first ask theSSA for a reconsideration of his or herclaim from a different group of SSA officials.If rejected again, the applicant can requesta hearing before an ALJ. These hearings donot include a government representative toquestion the claim on behalf of taxpayers.66Meanwhile, the SSDI applicant in the greatmajority of cases uses the services of lawyersworking on a contingency fee basis.67 It is aprocess slanted in favor of program expan-sion and higher spending.

If the ALJ denies the claim, the quest forfederal benefits is still not over. The SSDIapplicant can request a review from the So-cial Security Appeals Council. If the councileither denies the claim or decides against re-viewing it, the applicant can then file a law-suit in a federal district court. In 2011 over14,000 new civil actions were filed.68

In 2010 there were 2.9 million total ap-plications for SSDI benefits. Only 35 percentwere awarded benefits.69 However, that fig-ure includes applicants who were denied fortechnical reasons or where a final decision

was still pending. The overall allowance ratebased on medical decisions was 55 percent.70

For medical decisions made at the hearingslevel or higher, the allowance rate was 76 per-cent.71

Administrative Nightmare

The federal government faces huge andgrowing problems in administering SSDIbecause of the programs size and inherent

complexity. In particular, there is a massivebacklog of disability claims at the hearingslevel. Since 1977 the number of appeals tothe ALJ level has tripled.72 Claims awaiting ahearing before one of 1,400 ALJs grew from12,000 cases in 1999 to 817,000 cases in2012.73 The Social Security Administrationhas effectively instituted quotas on judgesto reduce the backlog. However, the Associa-tion of Administrative Law Judges says thatbecause of the quotas, many administra-tive law judges are pressured to grant more

claims than they otherwise would, as it sim-ply is faster and easier to grant claims thanto deny them.74

The backlog for continuing disability re-views (CDRs), which are conducted to makesure an individual collecting SSDI benefits isstill eligible, is another problem. At the endof 2010, the SSA had a backlog of almost 1.5million CDRs. The SSAs inspector generalestimates that between $1.3 billion and $2.6billion in unnecessary disability paymentscould have been avoided in recent years had

CDRs been conducted on time.75 The GAOnotes that between 2004 and 2008, the num-ber of CDRs conducted annually decreasedby almost 65 percent.76 In 2009 only 1.3 per-cent of SSDI recipients received a review.77

The SSA notes that a full review costs $1,000per case and in most cases the agency simplyascertains continuing eligibility by mailing


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The huge,complex, anddifficult-to-audit systemis a perfectbreeding groundfor awardingand continuingbenefits topeople whoshouldnt be onthe disabilityrolls.

the recipient a questionnaire.78 Less than 1percent of recipients who are reviewed havetheir benefits terminated.79

The inability to sufficiently monitorwhether individuals are still entitled to ben-

efits has contributed to a large volume of un-justified benefit payments and great deals offraud and abuse. The SSA inspector generalsoffice says that fraud is an inherent risk inSSAs disability programs.80 While the SSAdoes not generally release information onparticular SSDI awards, voluminous exam-ples of waste and fraud can be found fromdocument releases in court cases. An editorof a disabilities legal publication, James M.Taylor, dug through court documents indisability cases and found many appalling

examples of the SSA awarding benefits whenindividuals clearly were not too disabled togain employment.81

Indeed, a casual Internet search revealsmany articles about SSDI fraud. Not only areindividuals bombarding the system with bo-gus claims for benefits, but shady health careprofessionals are helping them. For example,a San Diego psychologist recently pled guiltyto falsely certifying dozens of individuals asbeing disabled, resulting in the governmentpaying out over $1.5 million in unwarrant-

ed benefits. The doctor admitted that ap-proximately 33 percent of his patient filescontained fabrications, false statements, andfalse certifications of disability.82

When individuals convicted of commit-ting fraud are caught, the SSA does not do agood job of recouping ill-gotten benefits. AnSSA inspector general audit examined 272beneficiaries who had been convicted of de-frauding the SSA and found that 96 of thoseindividuals were still collecting benefits. Theaudit noted that often the payment terms

agreed to by SSA are so unfavorable thatSSA will never fully recover the amountsowed from these individuals.83

The GAO has found that the SSA toooften overpays benefits. In 2010 SSDI ben-efit overpayments were $1.4 billion, and theGAO says that the figure could be even larg-er than SSAs data detect.84 The GAO has

been critical of the SSAs efforts to recoveroverpayments and notes that although debtcollections have increased, the overall debthas gone from $2.5 billion in 2001 to $5.4billion in 2010. That excludes $4 billion in

overpayment debt that the SSA wrote off.

85

Given the subjective and convoluted na-ture of determining SSDI eligibility, its like-ly that erroneous and unjustified paymentsare far larger in volume than just outrightfraud. The huge, complex, and difficult-to-audit system is a perfect breeding ground forawarding and continuing benefits to peoplewho shouldnt be on the disability rolls.

According to the GAO, the list of impair-ments used to determine if an applicant hasan eligible disability is outdated and the SSA

has been slow to revise it.86

Mental disorders,for example, have grown to become the sec-ond-largest impairment cited for awardingdisability benefits (19 percent), behind mus-culoskeletal system and connective tissue(34 percent).87 In terms of initial and recon-sidered claims allowed based on the SSAsmedical listings, mental disorders are by farthe largest category.88 However, the GAO re-ports that it has been at least 27 years sinceSSA finalized comprehensive revisions for . . .mental and neurological disorders.89

The SSAs concept of disability is alsooutdated. Workplace accommodations andassistive devices can enable many of todaysdisabled people to function in a job, but theSSA does not always consider them in itsassessment of disability.90 For example, theSSA says that assistive devices are incorpo-rated into the medical listings once they be-come standard in the medical community.But when asked if wheelchairs are consid-ered standard in the medical community,and whether consideration is given to how

individuals with wheelchairs might func-tion in todays more white-collar economy,SSA officials gave the GAO conflicting in-formation.91

Because of the subjectivity and complex-ity involved in determining if a medicalcondition warrants disability benefits, out-comes at the appeals level show a high de-


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The complicatedprocess for

seeking disabilitybenefits has

become a boonto legal firms

that specialize indisability claims.

gree of variation. When the SSA inspectorgeneral (IG) examined the four impairmentsthat are most frequently accepted for reviewat the appeals level, it found that the varia-tion could be large even within the same city.

The IG noted that one hearing office in theChicago Region had an allowance rate of 83percent for cases with Disorders of Back, butanother hearing office in the Chicago Re-gion had an allowance rate of 45 percent forcases with the same impairment.92

The differences are even larger for casesreviewed by an ALJ. The IG cited an examplewhere one judge approved 97 percent of hiscases that involved back disorders, while an-other judge only allowed 15 percent of hiscases with that health problem.93 Judges are

largely independent and possess broad dis-cretion to award or deny benefits. They arealso hard to fire, which means an appoint-ment can amount to a lifetime position.

A recent Senate oversight committee in-vestigation reviewed 300 cases from a coun-ty in three different states. The investigationfound that benefit award decisions made atthe ALJ level were fraught with problems:

These problems ranged from basingdecisions on evidence of questionable

value, to citing insufficient evidenceto support the decision made, mis-using expert testimony, and holdingperfunctory hearings. The result wasa large number of poor quality deci-sions, raising questions about wheth-er they were decided correctly.94

Other findings from the investigation in-cluded:

Some judges awarded benefits even

though the claimant was able towork.95

The SSA discourages the introductionof evidence in support of a claim lessthan 10 days before a hearing. In oneregion, it is mandatory not to admitevidence that isnt received five days inadvance. However, in some cases evi-

dence was allowed by an ALJ as late asa few hours before the hearing.96

When contradictory evidence was pro-vided by different sources, both DDSofficials and ALJs were more likely to

cite the evidence more favorable to theclaimant.97

Judges who spoke to investigators point-ed to the heavy workload and the fact thatrules used to determine eligibility have be-come so complex. One result of judges tryingto expeditiously complete case loads is highapproval rates of about 60 percent on aver-age.98 In 2011, 130 ALJs awarded benefitsin 85 percent or more of the cases heard.99

A judge in West Virginia awarded benefits

in all but four of the 1,284 cases he tried in2010.100 Overall, the Wall Street Journalfoundthat in 2011, 1,334 judges made more awardsthan denials, while only 439 judges had theratio the other way around.101

The SSA has started performing focusedquality reviews on random samples of de-cisions made by ALJs. A 2011 report foundthat more than one in five decisions con-tained errors.102 Although an error does notautomatically mean that disability benefitswere incorrectly awarded, 82 percent of the

decisions were remanded to the originat-ing hearing office for further review becausethe record was not sufficient to render a de-cision.103

The complicated process for seeking dis-ability benefits has become a boon to legalfirms that specialize in disability claimsThe vast majority of applicants who appeala denial of benefits to the ALJ level have legalrepresentation.104 For some impairmentsback disorders, for examplerepresentationcan exceed 90 percent.105 These lawyers typi-

cally work on a contingency fee basis, whichmeans a large amount of taxpayer moneyends up in the pockets of thousands of dis-ability lawyers.

An applicant whose appeal is successful isawarded payments dating back to the onsetof the disability. The lawyer typically receives25 percent or up to $6,000 of this back pay.


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The NPRreporter aptlyrefers to thecollaborationbetween thepublic andprivate sectorsto expand thedisability rolls a

the Disability-IndustrialComplex.

While that amount may not be enticing togeneral law firms, firms specializing in dis-ability claims can make millions of dollarsbased on a high volume of cases and know-ing how to work the system. According to

SSA data obtained by the Wall Street Journal,fees paid to lawyers and other representativesof SSDI applicants went from $425 millionin 2001 to $1.4 billion in 2011.106 Legal firmsare aware of which judges are more likely toaward benefits and try to steer their clientsaccordingly.

The Wall Street Journal profiled the na-tions largest disability advocate, the firmBinder and Binder.107 The rise of the firmstems from a 2004 federal law that madeit easier for non-lawyers to represent appli-

cants. The motivation for this legal changewas to nurture advocacy organizations thatwould help move applicants through thecomplicated process and thus reduce thebacklog of claims. Binder and Binder quicklymoved to hire cheaper nonlawyers and start-ed advertising nationally. According to oneformer Binder case manager, the firm is likea warehouse whose employees objective isto see how much money they can make.108In 2010 the SSA paid Binder $88 million infees. Binder and Binder has a reputation for

withholding information that could damagea clients case, but the SSAs commissionersays that we are not so much in the businessof, quote unquote, monitoring law firms.109

Law firms are not the only private inter-est making money off of the SSDI system.In a special report on federal disability pro-grams, National Public Radio recently high-lighted the firm Public Consulting Group(PCG), which provides consulting servicesto state governments.110 One of the servicesPCG provides is helping states move people

from cash welfare, which is partly fundedwith state money, to SSDI, which the federalgovernment fully pays for. For example, a re-cent contract with the state of Missouri willpay PCG $2,300 for every person it helps ob-tain SSDI benefits. With that kind of moneyto be made, PCG goes to great effort to getpeople on the disability rolls:

The PCG agents help the potentiallydisabled fill out the Social Securitydisability application over the phone.And by help, I mean the agents actual-ly do the filling out. When the poten-

tially disabled dont have the rightmedical documentation to prove adisability, the agents at PCG helpthem get it. They call doctors offices;they get records faxed. If the rightmedical records do not exist, PCG setsup doctors appointments and callsapplicants the day before to remindthem of those appointments.

PCG also works very, very hard tomake the people who work at the So-cial Security Administration happy.

Whenever the company wins a newcontract, Coakley [a PCG employee]will personally introduce himself atthe local Social Security Administra-tion office, and see how he can makethings as easy as possible for the ad-ministrators there.

We go through even to the point,frankly, of do you like things to bestapled or paper-clipped? he told me.Paper clips wins out a lot of timesbecause they need to make photocop-

ies and they dont want to be takingstaples out.111

The NPR reporter aptly refers to the col-laboration between the public and privatesectors to expand the disability rolls as theDisability-Industrial Complex. And sheaccurately notes that It has just one goal:push more people onto disability.112

Conclusion

With massive and ongoing federal deficits,policymakers need to pursue spending cutsin every area of the budget. The Social Secu-rity Disability Insurance programs soaringexpenditures desperately need to be tackled.SSDIs trust fund is expected to be exhaustedin just a few years. While some policymakers


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SSDI is a classicexample of a

well-intentionedeffort to providemodest support

to truly needypeople that

has explodedinto a massive

entitlement thatis driving up the

federal deficit.

might favor higher SSDI taxes to bolster thetrust fund, that would further punish work-ers and damage the economy in order to propup a structurally flawed program that is col-lapsing under its own weight.

SSDI spending should be cut sharply.That can be achieved by cutting SSDIs aver-age benefit levels and instituting stricter eli-gibility standards to discourage claims frompeople who could be working. Other chang-es might include imposing a longer delayfor the initial receipt of benefits to discour-age frivolous applications, and reducing thelarge number of appeal opportunities forpeople who are denied benefits. Steps couldalso be taken to ensure greater quality con-trol and consistency of decisions by SSA of-

ficials and judges. The administrative lawprocess should include a role for a taxpayeradvocate to challenge any dubious claimsmade by applicants and their lawyers.

Continuous disability reviews of peoplereceiving benefits should be vigorously ap-plied. During 1980 and 1983 when the SSAreexamined large numbers of SSDI recipi-ents, it found that 40 percent were not suffi-ciently disabled to be receiving benefits.113 Itwould not be surprising if that share is highertoday. The experience of the 1980s shows that

SSDI spending can be cut when policymak-ers focus on saving taxpayer money. It is alsotrue, however, that SSDI spending bouncedback with a vengeance after the 1980s as poli-ticians reverted to their spendthrift ways.

Today, reforms are needed more thanever.114 Reining in SSDI would not only savetaxpayer money, it would also give margin-ally disabled people who have valuable skillsan incentive to reenter the workforce.115Once people get on SSDI, they rarely leavethe program and go back to work, even

if their health improves. Indeed, only 3.6percent of workers on SSDI had their ben-efits terminated in 2011 because of medi-cal improvement.116 With the U.S. work-force shrinking because of the retirement ofdroves of baby boomers, the economy can-not afford policiessuch as excessively gen-erous SSDIthat suppress work incentives.

In sum, SSDI is a classic example of awell-intentioned effort to provide modestsupport to truly needy people that has ex-ploded into a massive entitlement that isdriving up the federal deficit. Federal poli-

cymakers should pursue major cost-cuttingreforms to SSDI, but they should also beginconsidering ways of moving the provision oflong-term disability coverage to the privatesector.

Notes1. U.S. Census Bureau, Americans with Dis-abilities, various years, www.census.gov/people/disability/publications/reports_briefs.html.

2. The Board of Trustees, Federal Old-Age and

Survivors Insurance and Federal Disability In-surance Trust Funds, The 2012 Annual Report ofthe Board of Trustees of the Federal Old-Age and Survi-vors Insurance and Federal Disability Insurance Trust

Funds (Washington: Government Printing Of-fice, 2012), Table V.C5, p. 131, www.ssa.gov/oact/tr/2012/tr2012.pdf.

3. Budget of the U.S. Government, Fiscal Year2014, Historical Tables (Washington: Govern-ment Printing Office, 2013), Table 13.1.

4. The tax rate was temporarily reduced from1.8 percent in 2011 and 2012 in an effort to stim-ulate the economy.

5. Congressional Budget Office, Policy Op-tions for the Social Security Disability InsuranceProgram, July 2012, p. III.

6. Title X of the Social Security Act did autho-rize grants to the states for aid to the blind.

7. Edward D. Berkowitz,Americas Welfare StateFrom Roosevelt to Reagan (Baltimore: John Hop-kins University, 1991), pp. 15859.

8. Social Security Administration (SSA), A His-tory of the Social Security Disability Programs,

January 1986, www.ssa.gov/history/1986dibhistor

y.html.

9. Edward D. Berkowitz, Disabled Policy: Americas Programs for the Handicapped (New York: PressSyndicate of the University of Cambridge, 1987),p. 55.

10. Berkowitz,Americas Welfare State, p. 51.

11. SSA, www.ssa.gov/history/corningchap3.html


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15

12. Berkowitz, Americas Welfare State, pp. 16465.

13. House Ways and Means Committee, Com-mittee Staff Report on the Disability InsuranceProgram, July 1974, pp. 108109, www.ssa.gov/history/pdf/dibreport.pdf.

14. House Ways and Means Committee, Com-mittee Staff Report on the Disability InsuranceProgram, July 1974, pp. 10910, www.ssa.gov/history/pdf/dibreport.pdf.

15. Ibid., pp. 10910.

16. Ibid., p. 112.

17. Berkowitz,Disabled Policy, pp. 7377.

18. Berkowitz,Americas Welfare State, p. 165.

19. Ibid., p. 166.

20. Ibid., p. 169.

21. House Ways and Means Committee, p. 115.

22. SSA, A History of the Social Security Dis-ability Programs, January 1986, www.ssa.gov/history/1986dibhistory.html.

23. Berkowitz, Americas Welfare State, p. 176.

24. SSA, Annual Statistical Supplement to theSocial Security Bulletin, 2012, Table 3.C6.1, Feb-ruary 2013.

25. SSA, A History of the Social Security Dis-ability Programs.

26. Berkowitz,Disabled Policy, p. 44.



29. Ibid., pp. 11422.

30. Citied in Berkowitz, ibid., p. 124.

31. Cited in Berkowitz, ibid., p. 125.

32. Berkowitz,Disabled Policy, pp. 12836.

33. Ibid., pp. 14043.


35. David Autor, The Unsustainable Rise of theDisability Rolls in the United States: Causes, Con-

sequences, and Policy Actions, National Bureau ofEconomic Research (2011): 5, http://economics.mit.edu/files/6880.


37. SSA, Annual Statistical Supplement to the

Social Security Bulletin, 2012, Tables 2.F1 and2.F2.

38. The Board of Trustees, Federal Old-Age andSurvivors Insurance and Federal Disability Insur-ance Trust Funds, Table V.C6, p. 138.

39. Budget of the U.S. Government, Fiscal Year2014, Table 13.1.

40. Ibid.

41. The Board of Trustees, Federal Old-Age andSurvivors Insurance and Federal Disability Insur-ance Trust Funds, p. 2.

42. Ibid., p. 64, www.ssa.gov/oact/tr/2012/tr2012.pdf.

43. SSA, Table 2. As of March 2013.

44. SSA, Table 2. As of March 2013.

45. 42 USC 423(d)(1)(A).

46. U.S. Census Bureau.

47. Richard V. Burkhauser and Mary C. Daly,The Declining Work and Welfare of People with Dis-abilities (Washington: AEI Press, 2011), p. 38.

48. David Autor and Mark Duggan, TheGrowth in the Social Security Disability Rolls: AFiscal Crisis Unfolding, Journal of Economic Per-

spectives (2006): 7194.

49. Richard Burkhauser, Reforming SocialSecurity Disability Insurance, Rippon Forum,Spring 2011.

50. Nicole Maestas, Kathleen Mullen, and Alex-ander Strand, Does Disability Insurance ReceiptDiscourage Work? Using Examiner Assignmentto Estimate Causal Effects of SSDI Receipt, Uni-

versity of Michigan Retirement Research Center,Working Paper no. 2010-241, August 31, 2012, p.29.

51. See Chris Edwards and George Leef, Fail-ures of the Unemployment Insurance System,Cato Institute, June 2011, www.DownsizingGovernment.org.

52. Congressional Budget Office, Social Securi-ty Disability Insurance: Participation Trends and


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16

Their Fiscal Implications, July 22, 2010, p. 7.

53. Richard J. Pierce, What Should We DoAbout Administrative Law Judge Disability De-cisionmaking? George Washington UniversityLaw School Public Law Research Paper no. 573,

July 20, 2011, p. 4.

54. Ibid., p. 4.

55. Ibid., p. 4.

56. Ibid., p. 4.

57. Richard J. Pierce, Errata, Regulation 34, no.4 (Winter 20112012): 7.

58. James M. Taylor, Facilitating Fraud: HowSSDI Gives Benefits to the Able Bodied, CatoInstitute Policy Analysis no. 377, August 15,2000.

59. Office of Inspector General, SSA, The So-cial Security Administrations Listing of Impair-ments, A-01-08-18023, March 2009, p. 1.

60. Ibid., p. 3.

61. Minority Staff Report, Senate PermanentSubcommittee on Investigations, Committeeon Homeland Security and Government Affairs,Social Security Disability Programs: Improvingthe Quality of Benefit Award Decisions, Septem-ber 13, 2012, p. 88.

62. See Jeffrey S. Wolfe and David W. Engel,Restoring Social Security Disabilitys Purpose,

Regulation 36, no. 1 (Spring 2013).

63. See Umar Moulta-Ali, Social Security Dis-ability Insurance (SSDI): The Five-Month Wait-ing Period for Benefits, Congressional ResearchService, RS22220, January 24, 2013.

64. Congressional Budget Office, Policy Op-tions, July 2012, p. III.

65. SSA, Annual Statistical Report on theSocial Security Disability Insurance Program,2011, Table 50, p. 126.

66. Wolfe and Engel, pp. 5253.67. Ibid., pp. 5354.

68. SSA, www.ssa.gov/appeals/court_process.html.

69. SSA, Annual Statistical Supplement to theSocial Security Bulletin, 2012, Table 6.C7.

70. SSA, Annual Statistical Report Table 59,

p. 142. Data include concurrent applications forSocial Security Disability Insurance and Supple-mental Security Income (SSI); they do not in-clude SSI-only applications.

71. Ibid., Table 62, p. 148. Data include concur-rent applications for Social Security Disability

Insurance and Supplemental Security Income(SSI); they do not include SSI-only applications.

72. Burkhauser and Daly, The Declining Work andWelfare of People with Disabilities (Washington: AEIPress, 2011), p. 52.

73. Government Accountability Office (GAO)Social Security Disability: Management of Dis-ability Claims Workload Will Require Compre-hensive Reporting, GAO-10-667T, April 272010, p. 1; and SSA, Performance and Account-ability Report for Fiscal Year 2012, p. 182, www.ssa.gov/finance/2012/Full%20FY%202012%20PAR.pdf.

74. Letter from D. Randall Frye, President, Association of Administrative Law Judges to Caro-lyn W. Colvin, Acting Commissioner, SSA, April9, 2013, www.aalj.org/system/files/documents/colvin_letter_of_april_9_final_1.pdf.

75. Office of Inspector General, SSA, Full Med-ical Continuing Disability Reviews, A-07-09-29147, March 2010, p. 2.

76. GAO, Social Security Disability: Manage-ment of Disability Claims Workload Will RequireComprehensive Reporting, p. 10.

77. Mark Duggan, Understanding the Project-ing the Rise in SSDI Enrollment, presentationto Social Security Advisory Board forum on SSDIreform, March 8, 2013, slide 13, http://ssab.gov/Portals/0/2013Forum/Presentations/1.2%20Duggan%20Forum%20slides.pdf.

78. SSA, Performance and Accountability Re-port for Fiscal Year 2011, pp. 7374.

79. Congressional Budget Office, Social Securi-ty Disability Insurance: Participation Trends andTheir Fiscal Implications, 2010, p. 4.

80. Office of the Inspector General, SSA, Disabil-ity Insurance Beneficiaries Convicted of Crimesagainst the Social Security Administrations Pro-grams, A-06-06-16132, September 2007, p. 3.

81. Taylor.

82. Office of the Inspector General, SSA, SanDiego Psychologist Admits Falsifying Social Se-curity Disability Reports in $1.5 Million FraudScheme, August 2, 2012.


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83. Office of the Inspector General, Disabil-ity Insurance Beneficiaries Convicted of Crimesagainst the Social Security Administrations Pro-grams, pp. 23.

84. GAO, Disability Insurance: SSA Can Im-prove Efforts to Detect, Prevent, and Recover

Overpayments, GAO-11-724, July 2011, p. 13.

85. Ibid., pp. 1517.

86. See GAO, Modernizing SSA Disability Pro-grams: Progress Made, but Key Efforts WarrantMore Management Focus, GAO-12-420, June2012.

87. SSA, Annual Statistical Report Chart 10,p. 93.

88. Office of Inspector General, The Social Se-curity Administrations Listing of Impairments,p. 3.

89. GAO, Modernizing SSA Disability Pro-grams: Progress Made, but Key Efforts WarrantMore Management Focus, GAO-12-420, June2012, p. 10.

90. Ibid., p. 28.

91. Ibid., pp. 2829.

92. Office of the Inspector General, SSA, Dis-ability Impairments on Cases Most FrequentlyDenied by Disability Determination Services andSubsequently Allowed by Administrative Law

Judges, A-07-09-19083, August 2010, p. 11.

93. Ibid., p. 12.

94. Minority Staff Report, p. 20.

95. Ibid., p. 99.

96. Ibid., p. 105.

97. Ibid., p. 118.

98. Damian Paletta, Disability-Benefits Sys-tems Faces Review, Wall Street Journal, December15, 2011.

99. Damian Paletta, Ex-Judges Disability Rul-ings Probed, Wall Street Journal, November 25,2011.

100. Ibid.

101. Paletta, Disability-Benefits Systems Faces

Review, 2011.

102. Minority Staff Report, p. 14.

103. Ibid., pp. 1415.

104. Burkhauser and Daly, p. 53.

105. Office of the Inspector General, DisabilityImpairments, p. 5.

106. Damian Paletta and Dionne Searcey, TwoLawyers Strike Gold in U.S. Disability System,Wall Street Journal, December 22, 2011.

107. Ibid.

108. Ibid.

109. Ibid.

110. Chana Joffe-Walt, Unfit for Work: TheStartling Rise of Disability in America, NationalPublic Radio, March 22, 2013, http://apps.npr.org/unfit-for-work/

111. Ibid.

112. Ibid.

113. Richard J. Pierce, What Should We DoAbout Social Security Disability Appeals?Regu-lation, Fall 2011, p. 38.

114. For a discussion of reform alternatives, seeJagadeesh Gokhale, Reforming SSDI, Regula-tion 36, no. 1 (Spring 2013).

115. See ibid. Gokhale cites two studies thatfound that labor-force participation rates wouldbe higher in the absence of SSDI.

116. SSA, Annual Statistical Report, Table 50,p. 126.


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The Rising Cost of Social Security Disability Insurance

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Transcript of The Rising Cost of Social Security Disability Insurance