Welfare State Madness

Social+Security+Disability+LawAnother dubious record has been set during the Obama administration. As of the end of December, a staggering 10,988,269 Americans were receiving federal disability benefits, a number that exceeds the entire population of Greece. The December totals mark the 202nd straight month that the number of disabled workers in the nation has increased. Furthermore, according to the latest Annual Statistical Report on the Social Security Disability Insurance Program, “mental disorder” is the top “diagnostic group,” comprising 35.5 percent of all disabled beneficiaries. Within that category, “mood disorders” is the most prevalent affliction, at 14.1 percent.

Though it is the latest report released, the statistics compiled represent the disabled beneficiaries as of December 2012, when approximately 88,000 fewer Americans were receiving benefits. The overall number of disabled beneficiaries has nearly doubled since December 1995. The Social Security Administration (SSA) defines a disabled worker as a “beneficiary who worked in covered employment long enough to be insured and who had been working recently in covered employment prior to disability onset.” A spouse eligible for benefits must have a child under age 16 or a disabled child in his or her care, or be at least 62 years old. A divorced spouse is also eligible if the marriage lasted at least 10 years. 

As of December 2013, the average monthly benefit paid to a disabled worker also hit a record high of $1,146.43, as did the monthly payouts to spouses and children, reaching $308.13 and $341.42 respectively.

No doubt many Americans may wonder why the number of disabled is growing so rapidly. Many analysts contend it is due to a Baby Boomer generation that is now entering retirement and dealing with health problems associated with aging. On the other hand, Mark Duggan and Scott Imberman, disability researchers at the National Bureau of Economic Research, have reached an entirely different conclusion. In a study, “Why Are the Disability Rolls Skyrocketing?” the authors reveal that aging accounted for the growth disability benefits in only 13 percent of male recipients and 4 percent of female recipients, with the relatively recent increase in women entering the workforce accounting for the discrepancy. The biggest driver of growth, at 45 percent for men, and 36 percent for women, was the relaxation of medical eligibility criteria. Relaxed criteria that has made it possible for otherwise able-bodied Americans to get a lifetime’s worth of government paychecks. 

Unsurprisingly, politics played the principal role in expanding the definition of “disabled.” In his last year as president, Jimmy Carter signed the Disability Amendments Act of 1980, encouraging stricter oversight of Social Security disability benefits. When Reagan assumed the presidency, he asked the SSA to step up enforcement of the law. As a result, one million Americans lost their benefits. The political backlash led to Congress unanimously passing the Social Security Disability Benefits Reform Act of 1984. The law instructed government to give an applicant’s self-assessment of a disability greater consideration, especially in the areas of pains and discomfort. It also allowed assessments by one’s own doctor to take the place of medical assessments made by the government, and it eased the screening criteria for some categories, including mental illness.

The effects were dramatic. Since subjective assessments by an applicant enabled many people to claim disability — while medical advances lowered the number of disabling medical conditions — disability benefits dramatically increased for people with musculoskeletal and mental disorders, even as benefits for those suffering from conditions such as cancer, strokes, or heart attacks remained constant.

Duggan and Imberman also charted the correlation between the number of disabled and the second biggest driver of growth, increased government payouts. The SSA pays out benefits based on what someone made while they were working, plus means testing. They noted that due to the expansion of income subject to Social Security taxes, and a growth of income dispersion, low-income Americans gain higher levels of disability payments relative to their previous income.

In addition, Americans who qualify for disability insurance via the Social Security program automatically qualify for Medicare after two years, regardless of age. Aaron Yelowitz of the National Bureau of Economic Research and the University of California published research indicating that “13 to 20 percent of the rise in SSI participation may be due to increases in the value of Medicaid.”  

Given these realities, it is unsurprising that disability claims have skyrocketed over the last three decades. Adding to the momentum, a report by National Pubic Radio’s (NPR) Chana Joffe-Walt paints a disturbing picture of what she calls a “disability-industrial complex.” It amounts to little more than members of the legal and medical professions dedicating themselves to getting as many Americans on disability as they possibly can.

The surge in disability recipients is also exacerbated by economic downturns. During the last three recessions, applications for Social Security Disability Insurance (SSDI) have increased in conjunction with the unemployment rate. “It’s primarily economic desperation,” said former Social Security Commissioner Michael Astrue in 2011. “People on the margins who get bad news in terms of a layoff … have no other place to go and they take a shot at disability.”

NPR’s Joffe-Walt confirms that assessment, noting that “disability has also become a de facto welfare program for people without a lot of education or job skills.” This is due to the reality that the difference between a minimum wage job and disability payments is only $2000 per year, and the jobs probably don’t include health insurance. Thus she concludes that “disability may be a better option.” 

That option, absent a legitimate disability, amounts to gaming the system. An egregious example of gaming the system was recently uncovered in New York. More than 100 retired cops and firemen allegedly gamed the system out of $400 million in fraudulent disability claims dating back to 1988. Over half the claimants blamed 9/11 for a variety of mental ailments after being coached how to describe their symptoms by four individuals who oversaw the scheme. “Specifically they instructed them on how to intentionally fail memory tests, how to dress when they presented themselves and how to present their demeanor,” said Manhattan District Attorney Cyrus Vance Jr.

They are hardly an anomaly. A report published by the Senate’s Permanent Subcommittee on Investigations following an 18-month investigation reveals that in over a quarter of the cases they reviewed, evidence confirming disabilities was “insufficient, contradictory, or incomplete.” A 2011 internal investigation by the SSA revealed an almost identical error rate at 22 percent. Senator Tom Coburn (R-OK), a medical doctor, reviewed 100 cases personally. “In about 75 percent of the cases I went through, people were not truly disabled,” he concluded. He further noted huge inconsistencies regarding how administrative judges reviewed evidence contending that “you could flip a coin for anybody that came before the Social Security commission for disability and get it right just as often as the judges.”

The Heritage Foundation’s James Sherk contends that the rise in SSDI participation accounts for a reduction of almost one-third in the workforce participation rate between 2007 and 2001. He also implies that gaming the system is part of the equation. “Studies show that a significant number of workers who apply for disability benefits are not entirely disabled,” he writes. “They have medical conditions that qualify them for benefits, but under other circumstances they could work at some type of job. Given the option of receiving benefits, however, they take them.”

And once Americans begin taking disabled benefits, most never return to the labor force. As Sherk reveals, only 9 percent of SSDI recipients who quit the system do so because their health has improved to the point where they’re no longer eligible. As for people who voluntarily leave the system, a “Ticket-to-Work” program created in 1999 that allowed recipients to return to work — while keeping their health insurance — netted fewer than 1,400 claimants over the following seven years.

Given the rapid expansion of claimants and payouts, it should surprise no one that SSDI will run out of money by 2016. Thus, reforming the system would seem to be an urgent priority. Tad DeHaven, a budget analyst at the Cato Institute, illuminates the reason why it will prove quite difficult for Congress to do so. “Do you want to be the member that has the quote, unquote, ‘disabled’ activists outside of your office protesting?” he asks. “It’s like any other program, you’ve got to be willing to stick your neck out and you’ve got to be willing to find people to go along.”

Another report, “How Some Legal, Medical and Judicial Professionals Abused Social Security Disability Programs for the Country’s Most Vulnerable: A Case Study of the Conn Law Firm,” may provide a great deal of impetus in that regard. Once again Sen. Coburn led the charge. “In just two years, the Social Security Disability Trust Fund could be depleted,” he explained. “That means millions of disabled Americans will face benefit cuts while every American could see an increase in their payroll taxes. That is unacceptable. What is also outrageous…is how well-heeled and well-connected lawyers, doctors, and judges have gamed the system for their own benefit. Every bogus claim made on behalf of someone who is not truly disabled robs taxpayers and denies or delays benefits for someone who is truly disabled.”

That’s what the “disability-industrial complex” is all about. Most Americans have no problem whatsoever helping the truly disabled, even as most Americans bristle at the thought of underwriting able-bodied frauds. 

A solution for the problem may be simpler than most people think. As columnist Jonah Goldberg notes, everyone in Great Britain receiving their version of a disability payment was recently asked to submit to a medical examination to confirm they were too disabled to work. A third of them simply dropped out of the program rather than be examined. More than half of those tested were found fit for work, and 25 percent were fit for some work. He suggested the United States do the same thing, believing the results “would be interesting too.” In a nation where “victimhood” has become a way of life, they might be fascinating.

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  • Hassan

    Something is seriously wrong with the USA. It consumes nice people and spits out drug addicts and criminals. I guess that is the inevitable consequence of lack of morals.

  • Bamaguje

    “SSDI will run out of money by 2016… Tad DeHaven, a budget analyst… illuminates the reason why it will prove quite difficult for Congress…. “Do you want to be the member that has… ‘disabled’ activists outside of your office protesting?” – Arnold Ahlert.

    May be the disability program should be allowed to run out of money and collapse on its own weight. Americans would then become more amenable to reforming the disability cesspool.

    • Michael7117

      When does any government ever run out of money? It’s too easy to just raise taxes or print more money.

  • bobsoper

    If the author of this sloppy hit piece did any research, he would know that the increase in SSDI claims since 1995 is largely attributable to two things: baby boomers reaching the age where people are statistically much more likely to become disabled, and the 2007-2014 (so far) recession and jobless recovery. Many people who meet the criteria for disability prefer to work, but if those jobs are gone (thanks to offshoring and a GOP intent on preventing a strong recovery in order to hurt Obama and the Democrats), then those folks have no other option than to claim benefits.
    By the way, ask people who work with the disabled just how “easy” it is to get approved for benefits. It isn’t.

    • rxpc

      Actually, I think the author addressed both of your complaints. He points out that some studies have shown that those 2 reasons alone cannot account for the rate of increase. Hence, the other possible causes.

      • bobsoper

        Baby boomers (especially those whose income is at or below the poverty level) are in general experiencing poorer health than their parents. They’re more sedentary and obese, & diabetes is now endemic. Some of this can be blamed on increasing poverty itself, and the current lack of access to preventative care which wasn’t as much of a problem 30 years ago. Idiots like Rick Perry and Rick Scott aren’t helping matters by blocking the PPACA’s Medicaid expansion in their respective states. They’re leaving the poorest (and sickest) with no option but to seek benefits when their health collapses.
        With some notable exceptions (such as the corrupt NYC cops, and those hillbillies mentioned in the NPR/Planet Money hit piece –which the author of this hit piece refers to), all in all it is not an easy matter for people to get approved for SSDI benefits. However, the sheer volume of relatively unhealthy people reaching their unhealthiest years has increased the program… which the administrators of the SSA have long been aware of. The recent near-depression that began in 2007 (and continues to this day) made the wave of SSDI claimants that much bigger… again, my point is that many claimants would rather be working, and as long as they did have a job they stayed out of the SSDI system.

        • cheechakos

          The largest group of recipients are mentally ill.(read the article) This includes anorexia ,obesity, addictions,cutting,mood disorders ADD/ADHD,autism etc.
          These people do not wake up one day and their health collapses.

          The next largest group is musculoskeletal ;this includes muscle pain,back issues,carpal tunnel syndrome,joint replacements etc.

          You are spouting political rhetoric instead of looking at the medical issues.

          Paying obese people to lay around,alcoholics to do nothing all day and people with back pain to have children is ridiculous. There are millions of people abusing the system .They are easy to find if you stop lying to yourself and look.

          • bobsoper

            Alcoholism and drug addiction have not been criteria for SSDI in many years. In fact, many administrative law judges will deny benefits to an applicant who meets the criteria but can be shown to be actively using illicit drugs or abusing alcohol. But you’re not here to discuss the facts; you’re here to repeat what you saw on Hannity.

      • nick

        Yes he would know that if he bothered reading it in its entirety.

        • bobsoper

          I read it. Did you? Nah, didn’t think so.

          • nick

            and you make that point because I made a false claim in the comments section re. the contents of the piece written. Oh no that was you wasn’t it?

    • Lynne

      I worked for job and family services before I had a family. The people that knew how to work the system brought home more money on a monthly basis than I did. The ones that really knew how to work the system would have their kids tested as soon as they became school age for a ” learning disability.” Tell a 5 year old he/she can’t learn so why bother to try? The government will take care of your needs. The only thing wrong with the article is people can qualify for SSI without ever paying a dime into the system. Truly disabled people must fight for their benefits while the obese, mood disorders, gender confused slugs get a ticket to the front of the line to collect benefits for the rest of their lives. I could write a book on the atrocities I saw when working in this field. It’s down right sickening.

  • oldtimer

    just another way for the dems and obama to destroy SS for future retirees.

  • Rdlake

    And we wonder how we manage to waste $200 billion a year.

  • redheart

    Cloward-Piven, over-burden the system to collapse it.

  • RonTakeOne

    Poor neighborhoods are being taxed more than they are receiving in aid. http://www.deftnews.com/?p=6635

    • JTK

      Neighborhoods are not taxed. Individuals are taxed. Persons who pay taxes are not the same who are receiving aid.

      • RonTakeOne

        Neighborhoods aren’t made up of individuals?

        • Debbie G

          So what if the neighborhood is paying out more tax than receiving aid. It just means that some hardworking families are subsidizing others. The point of this discussion is handouts, period.

  • John Davidson

    It is about time this subject is brought front and center. The Liberals are actually encouraging folks to be dependents for very obvious reasons.

  • Erudite Mavin

    You can also see in the senior citizen high rise bldgs., a large per cent are Senior Russians, Chinese, etc. Came here as Seniors and never put a dime in the system and live in Section 8 Apts. on Medi Cal, food stamps, and SSI, this by the tens of thousands in American Cities.

    Then you have the Somails to you name it by the tens of thousands in some cities, mostly young and middle age and living in Section 8 Apts. food stamps, Medi Cal the seniors on SSI, and all the other benefits.
    Thank Ted Kennedy for his 1964 bill, come one and all to live off the tax payers..

  • xkn

    Disability skyrocketed for a simple reason that there were no jobs left in vast portions of the US. The factories, providing good paying manufacturing jobs, were dismantled and shipped overseas. Unemployment benefits last certain time but disability benefits last lifetime. Given that there is no interest in nomenklatura to reverse the trend of wholesale job exportation, there is little incentive or for that matter choice for a vast number of people. They understand that their jobs are gone, and no replacement jobs are coming – ever! With the little money earned on a side and vast opportunities for receiving a need-based benefits ranging from free cell phones to free scholarships at Harvard, the disability simply is the most economical choice for majority of people.

  • Danny

    The Democrats would never allow people to be tested to see the extent to which they are fit to work. That would be oppressive and probably racist too (everything is nowadays).

  • Seek

    Back in the 90s I can remember the term for SSDI payments: “crazy cash.” All someone had to do to qualify was play at being crazy. Apparently, a lot of people since have mastered the art.

  • SoCalMike

    The recipients are only secondary and tertiary beneficiaries.
    The primary beneficiaries are the career politicians who the secondary beneficiaries vote for and the career parasite bureaucrats who administer the “help” because people need “help.”
    Nice gig.

  • CaoMoo

    After being convinced to apply for disabillity as I didnt want to even face the fact my health had betrayed me and it was against my work ethic, I finally agreed after going through many surgeries to fix my problems which made them worse. I had to fight to get it. Yet you see people on judge judy I have ADHD and I use my money for beer and porn, or I have back problems but I run a business from home and weightlift makes me mad. I hope to heal enough to go back to work, at this point it isnt likely but one can hope. Hey baby Im disabled aint the best line in the world.

  • John Davidson

    After reading what I already surmised, I do believe the crooks are winning in America.

  • trangbang68

    You have the American Psychiatric Association whose ludicrous Diagnostic and Statistical Manual is a “Collecting Disability Checks for Dummies” workbook. It explains the symptoms to the lazy and shiftless.

    Just as there are “croakers”, doctors who will write you all the opiate prescriptions you want, there are doctors and counselors who will get you on disability for the right fee. There are genuinely disabled people but there are hordes of unproductive leeches scamming the system because they can.
    It’s the product of a loss of national character, Instead of Rosie the Riveter and Bob the Carpenter, we have Willie the Crackhead and Betsy the Twinkie Devourer with a mood disorder, “I’m depressed because I need a electric scooter to get to the snack section at WalMart. Give me a check”

  • M. Archer

    Most of the responders to this article are correct in their assesment of the “problem” thus drawing our attention to the perfect storm of conditions which explain the phenomenon the article presents. Our progress in the medical and psychological feilds of neuro science in the past 15 years has revealed the previously hidden underlying brain disorders which have accounted for the steep rise in medical expenses throughout the world. In point of fact the number of legitimate brain disorders and subsequent behavioral afflictions has been shown, through evidence based studys, to be present in one out of four human beings. One in four have a diagnosable brain disorder! The incidence of PTSD in our society can be directly linked to the way we treat our fellow man; both in the theater of war and in the urban milieu of societal survival. When the overall culture is under seige by human avarice people cannot feel safe and thus the brain has trouble coping. You can’t see brain injury or emotional trauma on the outside so it becomes easier to label those who are vulnerable as frauds and begin our own “cleansing” operations to eat the wounded. We created the system of mental health care to give everyone a chance at mental and emotional saftey. Lets don’t blame the system that protects us all. Let us become intellectually honest about the root causes of our human sickness and take responsibility for choices of elected officials and corporate bearucrats who have selfishly driven our societal bus off of the cliff. Ultimately we are responsible for the system that governs our lives, and we have allowed our system to run away with our hope for a better future.

    • Debbie G

      “…previously hidden brain disorders…”? Are you saying people in the past never suffered from traumatic occurrences ?.
      “…when the overall culture is under seige…”? How about past peoples who were enslaved, when immorality was rampant, etc.
      In other words, mankind has had the SAME problems forever.
      What humanistic bullcrap.

  • Debbie G

    You are absolutely correct Lynne! I work for a pediatric specialist. We get requests all the time from families trying to get their kids on disability for “behavior problems,” “learning disabilities” and ADHD. By the way, some of these families are already covered by insurance!