Policy Solutions for the Disability Insurance Program

Roughly 11 million people receive compensation under the Social Security Disability Insurance Program (DI). The vast majority of these beneficiaries are disabled workers themselves, and a smaller share is spouses and children of disabled workers. While 11 million people rely on this program, it is facing an impending financial crisis: the DI program is currently in cash-flow deficit, and the federal government had to borrow $37 billion to finance program expenditures in FY2013. Experts expect the DI trust fund, which finances benefit payments, to be depleted by 2016, leading to a 20 percent cut in benefits on recipients. There are a number of policy changes – from accounting changes to revenue increases to spending cuts – that can help alleviate these concerns. This paper examines several potential avenues of reform.

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