We present the first causal estimates of the effect of Social Security Disability Insurance benefit receipt on labor supply using all program applicants. We use administrative data to match ...applications to disability examiners and exploit variation in examiners' allowance rates as an instrument for benefit receipt. We find that among the estimated 23 percent of applicants on the margin of program entry, employment would have been 28 percentage points higher had they not received benefits. The effect is heterogeneous, ranging from no effect for those with more severe impairments to 50 percentage points for entrants with relatively less severe impairments.
Full text
Available for:
BFBNIB, CEKLJ, INZLJ, IZUM, KILJ, NMLJ, NUK, ODKLJ, PILJ, PNG, SAZU, UL, UM, UPUK, ZRSKP
Many applications for Social Security Disability Insurance cannot be evaluated based on medical criteria alone. In specific cases, the current regulatory structure dictates that applicants who can no ...longer do past jobs are expected to adapt to new jobs up to the age of 55, but not after. As the proportion of these cases has grown and life expectancy among beneficiaries has increased, policymakers have considered whether expectations for adapting to new jobs above age 55 should be adjusted. Some recent reform proposals call for increasing the age cutoffs in the regulations. Although prior research predicts reduced program costs, the capacity of potentially affected applicants to continue working is unclear. Filling this gap, we evaluate the work capacity of applicants above age 55 using an instrumental variables strategy. Our estimates indicate that, for applicants on the margin of allowance, at most an additional 11.2 percent would work above the regulatory definition of meaningful employment (known as Substantial Gainful Activity) in the absence of Disability Insurance benefits. We explore the implications for adapting to new jobs above age 55 under the proposed policy regime.
Full text
Available for:
BFBNIB, FZAB, GIS, IJS, KILJ, NLZOH, NUK, OILJ, SAZU, SBCE, SBMB, UL, UM, UPUK
•We find the Great Recession induced nearly one million SSDI applications that otherwise would not have been filed, of which 41.8% were awarded benefits, resulting in over 400,000 new beneficiaries ...who made up 8.9% of all SSDI entrants between 2008 and 2012.•More than one-half of the recession-induced awards were made on appeal. The induced applicants had less severe impairments than the average applicant.•Only 9% had the most severe, automatically-qualifying impairments, 33% had functional impairments and no transferable skills, and the rest were denied for having insufficiently severe impairments and/or transferable skills.•Our estimates imply the Great Recession increased claims processing costs by $2.960 billion during 2008–2012, and SSDI benefit obligations by $55.730 billion in present value, or $97.365 billion including both SSDI and Medicare benefits.
We examine the effect of job displacement during the Great Recession on the Social Security Disability Insurance (SSDI) program. Exploiting variation in the severity and timing of the recession across states, we estimate the effect of unemployment on SSDI applications and awards. We find the Great Recession induced nearly one million SSDI applications that otherwise would not have been filed, of which 41.8% were awarded benefits, resulting in over 400,000 new beneficiaries who made up 8.9% of all SSDI entrants between 2008 and 2012. More than one-half of the recession-induced awards were made on appeal. The induced applicants had less severe impairments than the average applicant. Only 9% had the most severe, automatically-qualifying impairments, 33% had functional impairments and no transferable skills, and the rest were denied for having insufficiently severe impairments and/or transferable skills. Our estimates imply the Great Recession increased claims processing costs by $2.960 billion during 2008–2012, and SSDI benefit obligations by $55.730 billion in present value, or $97.365 billion including both SSDI and Medicare benefits.
Full text
Available for:
GEOZS, IJS, IMTLJ, KILJ, KISLJ, NLZOH, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UILJ, UL, UM, UPCLJ, UPUK, ZAGLJ, ZRSKP
4.
Disability Insurance Income Saves Lives Gelber, Alexander; Moore, Timothy; Pei, Zhuan ...
The Journal of political economy,
11/2023, Volume:
131, Issue:
11
Journal Article
Peer reviewed
We show that higher payments from US Social Security Disability Insurance (DI) reduce mortality. Using administrative data on new DI beneficiaries, we exploit discontinuities in the benefit formula ...through a regression kink design. We estimate that $1,000 more in annual DI payments decreases the annual mortality rate of lower-income beneficiaries by approximately 0.18–0.35 percentage points, implying an elasticity of mortality with respect to DI income of around −0.6 to −1.0. We find no robust evidence of an effect of DI income on the mortality of higher-income beneficiaries.
Disability Insurance and the Great Recession Maestas, Nicole; Mullen, Kathleen J.; Strand, Alexander
The American economic review,
05/2015, Volume:
105, Issue:
5
Journal Article
Peer reviewed
Open access
The US Social Security Disability Insurance (SSDI) program is designed to provide income support to workers who become unable to work because of a severe, long-lasting disability. In this study, we ...use administrative data to estimate the effect of labor market conditions, as measured by the unemployment rate, on the number of SSDI applications, the number and composition of initial allowances and denials, and the timing of applications relative to disability onset. We analyze the period of the Great Recession, and compare this period with business cycle effects over the past two decades, from 1992 through 2012.
Full text
Available for:
BFBNIB, CEKLJ, INZLJ, IZUM, KILJ, NMLJ, NUK, ODKLJ, PILJ, PNG, SAZU, UL, UM, UPUK, ZRSKP
Abstract We study the lifetime effects of the first and largest American youth employment and training program in the United States—the Civilian Conservation Corps (CCC), 1933–1942. We match newly ...digitized enrollee records to census, World War II enlistment, Social Security, and death records. We find that longer service in the CCC led to improvements in height, health status, longevity, geographic mobility, and lifetime earnings but did not improve short-term labor market outcomes, including employment and wages. We address potential selection into CCC duration using several approaches, most importantly two newly developed control-function approaches that leverage unbiased estimates of the short-term effects of a randomized controlled trial of Job Corps (the modern version of the CCC). Our findings suggest that short- and medium-term evaluations of employment programs underestimate effects because they fail to capture lifetime effects and often ignore or underestimate health and longevity benefits that increase in magnitude at later ages.
A crucial issue is whether social insurance affects work decisions through income or substitution effects. We examine this in the context of US Social Security Disability Insurance (DI), exploiting ...discontinuous changes in the benefit formula with a regression kink design to estimate the income effect of payments on earnings and employment. Using administrative data on all new DI beneficiaries from 2001 to 2007, our preferred estimate is that an increase in DI payments of $1 causes an average decrease in beneficiaries' earnings of $0.20 and that annual employment rates decrease by 1.3 percentage points per $1,000 of DI payments. These findings suggest that the income effect accounts for a majority of DI-induced reductions in earnings.
Full text
Available for:
BFBNIB, CEKLJ, NMLJ, NUK, PNG, UL, UM, UPUK
As health insurance becomes available outside of the employment relationship as a result of the Affordable Care Act (ACA), the cost of applying for Social Security Disability Insurance ...(SSDI)—potentially going without health insurance coverage during a waiting period totaling 29 months from disability onset —will decline for many people with employer-sponsored health insurance. At the same time, the value of SSDI and Supplemental Security Income (SSI) participation will decline for individuals who otherwise lacked access to health insurance. We study the 2006 Massachusetts health insurance reform to estimate the potential effects of the ACA on SSDI and SSI applications.
Full text
Available for:
BFBNIB, CEKLJ, INZLJ, IZUM, KILJ, NMLJ, NUK, ODKLJ, PILJ, PNG, SAZU, UL, UM, UPUK, ZRSKP
Opioid use is common among Social Security Disability Insurance (SSDI) beneficiaries, who account for a disproportionate share of opioid-related hospitalizations and mortality in the United States. ...However, little is known about the prevalence of opioid use prior to SSDI enrollment. Understanding when opioid use is established and how it correlates with individual characteristics and community prescribing practices would inform policy approaches to reducing opioid-related harm among SSDI beneficiaries. We estimated the prevalence of opioid use among SSDI applicants by applying a natural language processing algorithm to SSDI application data. We found the prevalence of opioid use among SSDI applicants declined from 33% in 2013 to 24% in 2018. In contrast, the share of applicants with musculoskeletal impairments, which are commonly associated with pain, was unchanged. The share of applications reporting opioid use declined across both sexes, all age groups and education levels, and all regions. There was substantial variation, however, in the magnitude of decline by geography, with the smallest declines in parts of the Midwest and Southeastern United States. SSDI application rates and applications reporting opioid use were more likely to come from communities with higher opioid prescribing rates. Our estimates suggest most SSDI beneficiaries began opioid use prior to entering the SSDI program.
Full text
Available for:
NUK, OILJ, SAZU, UKNU, UL, UM, UPUK
Vulnerable consumers may face barriers to using electronic payments, especially consumers in "unbanked" households where no member has an account to receive payments. In March 2013, the US Social ...Security Administration transitioned exclusively to electronic payments, representing a large shift in payment mode mandated at the federal level. This study identifies the size and characteristics of the population impacted by this shift, by linking administrative data on Social Security payments to a nationally representative survey on the use of bank accounts and financial services. We find that the minority of unbanked Social Security recipients took up electronic payments well before the March 2013 deadline. The mandate does not appear to have increased the use of bank accounts. Instead, recipients used electronic payment cards. However, the transition to electronic payments was slowest among the most financially vulnerable households, suggesting a focus on these households as payment methods continue to develop.
Full text
Available for:
BFBNIB, DOBA, FZAB, GIS, IJS, IZUM, KILJ, NLZOH, NMLJ, NUK, OILJ, PILJ, PNG, SAZU, SBCE, SBMB, SIK, UILJ, UKNU, UL, UM, UPUK
PDF
