The Social Security 2013 Trustees Report Is Out... But What Does It Mean for People With Disabilities? Eight Things You Need to Know

Here are 8 things you need to know about the 2013 Trustees Report and what it means for people with disabilities.
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The Social Security Trustees have released their annual report on the current and projected financial status of the Social Security trust funds. The report will get a lot of attention in the media, so be warned: it's critical to sort out the truth from the hype. Here are 8 things you need to know about the 2013 Trustees Report and what it means for people with disabilities.

1. The key takeaway from the Trustees' findings is that our Social Security system has continued to operate well for the American people, including people with disabilities and their families. The long-term projections of the 2013 Trustees Report remain unchanged from 2012: our Social Security system can continue to pay all scheduled old age, survivors, and disability benefits for more than the next 20 years. With modest adjustments, Social Security can continue to pay full benefits for generations to come.

2. The 2013 Trustees Report shows that Social Security is fully solvent until 2033. After 2033, it faces a moderate long-term shortfall. In 2012, Social Security took in about $54 billion more than it paid out. Its reserves are projected to be $2.7 trillion in 2012, and to grow to $2.9 trillion by the end of 2021. If Congress takes no action, beginning in 2033 the reserves would be drawn down, and revenue coming into the trust funds would cover about 77 percent of scheduled benefits. The 2013 Trustees Report also continues to project that the Disability Insurance (DI) trust fund by itself will be able to pay all scheduled benefits until 2016 when, if Congress takes no action, the DI trust fund will be able to pay about 80 percent of scheduled benefits.

3. Like the rest of the Social Security system, the long-term growth in Social Security Disability Insurance (SSDI) has been predicted for many years and is largely due to demographics. As I've discussed before, on average Americans are living longer but with more disability, and the baby boomers are now in their high disability years. Compared with several decades ago, more workers are now insured for SSDI due overall population growth as well as women entering the workforce in large numbers in the 1970s and 1980s. The rise in Social Security's full retirement age - from 65 to 66 - has also increased costs for the DI trust fund, as disabled workers continue receiving SSDI longer before switching over to retirement benefits. Importantly, growth in SSDI has already begun to level off and is projected to decline further as the baby boomers age into retirement.

4. Congress has traditionally reallocated payroll tax rates between the Social Security trust funds to address anticipated shortfalls. Reallocation has occurred nearly a dozen times in the past, about equally in both directions - from the DI to the OASI trust fund, and from the OASI to the DI trust fund. Action is once again needed to address the projected shortfall in the DI trust fund. Social Security's Chief Actuary has testified that a modest reallocation of the total OASDI payroll tax enacted prior to 2016 would allow both programs to pay full scheduled benefits through 2033 -- their current combined depletion date. Reallocation can put OASI and DI on an even track so that Congress can take action to ensure the long-term solvency of both Social Security trust funds.

5. Modest adjustments can ensure long-term solvency for our Social Security system. As noted by the Consortium for Citizens with Disabilities (CCD) Social Security Task Force, the National Academy of Social Insurance (NASI) and others, the long-term solvency of our Social Security system can be readily addressed by modest adjustments to premium contributions. One option is to raise the Social Security payroll tax cap so that the 6 percent of workers who earn over $113,700 a year contribute on all of their wages just like everyone else. Another option is to modestly increase the payroll tax rate paid by employers and workers, by about 1 percent. If implemented right away, either approach on its own would be nearly sufficient to ensure full 75-year solvency.

6. Surveys consistently show that Americans value Social Security as a safe, efficient and reliable system - and are willing to pay for it. In a recent national survey conducted by NASI, large majorities of Americans across all generations, incomes and political affiliations supported protecting and expanding Social Security - and contributing more in payroll taxes to do so. The CCD Social Security Task Force supports thoughtful approaches to ensuring the long-term solvency of the overall Social Security system, while preserving and strengthening the vital role that Social Security plays in supporting people with disabilities, seniors and their families.

7. Maintaining our Social Security system isn't just about dollars and cents - it's about strengthening economic security and dignity for all Americans, including people with disabilities and their families. As CCD has pointed out, benefits for disabled workers are modest but vital, averaging just over $1,100 a month in April 2013. About 3 in 10 men and 1 in 4 women become disabled before reaching full retirement age. More than half of SSDI beneficiaries rely on Social Security for at least 75 percent of their income, and the vast majority receive 90 percent or more of their income from these benefits.

8. Social Security is our nation's most reliable source of disability, life, and retirement insurance. Access to private disability and retirement insurance is extremely limited. Only about one-third of workers have long-term disability insurance through their employer, traditional pension protections are greatly diminished, and 401k plans are unreliable. As a column in The Hill put it, Social Security acts as a "giant and indispensable economic shock absorber." Social Security's modest but vital assistance makes it possible for people with severe disabilities to live independently, keep a roof over their heads and food on the table, and pay for needed, often life-sustaining medications and other basic expenses. The alternatives are often unthinkable.

Too often, people talk about making changes to our Social Security system without considering the impact such changes would have on real people. Let's instead work together to strengthen and preserve our nation's Social Security system for all Americans, including people with disabilities and their families.

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