SSDI provides a vital safety net for over 10 million Americans who cannot work because of a disability. The application process can be long and arduous, especially for those who are initially denied benefits and appeal the decision. Among those who do join the SSDI rolls, a large share lives in poverty. Only a small fraction of beneficiaries supplement their benefits with wages that are too low to result in benefit suspension or termination. A much smaller share earns enough to lose their cash payments, at least temporarily.
Labor force demographics account for most of the growth in the SSDI caseload over the last three decades, but much of the growth is also due to a complex array of other factors. Program features have been introduced to address these factors and to help lower the number of beneficiaries, ultimately by helping them return to work. However, these measures have not been sufficient to keep the SSDI Trust Fund solvent. Simplifying these features might reduce benefit outlays, but that remains to be seen. As lawmakers struggle to address the financing issue, they may consider options that help workers stay in the labor force rather than enter SSDI in the first place. These solutions are largely untested and would require substantial up-front costs for uncertain long-term savings to the SSDI Trust Fund. A substantial demonstration period--perhaps ten years or longer--could build the evidence base and policy consensus needed to move forward with these solutions (Mann & Stapleton 2013).