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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.

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. Published 2019. This article is a U.S. Government work and is in the public domain in the USA.

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.

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.

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.

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.

This study contributes to literature that examines how much time typically passes between disability onset and application for disability-program benefits. It addresses two questions: How long after onset do people wait to apply? How might variation in time between onset and application help to identify potential target groups for early intervention? Using Social Security administrative data from the Adult Disability Report, we find that the median period from onset to application is 7.6 months. Younger applicants tend to have waited longer, particularly those diagnosed with back impairments or arthritis. Among both younger and older applicants, individuals diagnosed with intellectual disability or other mental disorders are potential targets for early intervention programs because those groups wait the longest to apply and are the most likely to continue working in the interim.

This study examines workers who had physical or mental impairments that prevented continued work in their pre-onset occupation but did not qualify for Disability Insurance (DI) benefits. More specifically, we examine workers who experienced the onset of such impairments, applied for DI once, were denied benefits on the basis of residual ability to work in other occupations, and did not appeal the decision. In contrast to allowed claimants, this group of individuals continued to participate in the labor market at comparatively high rates. We describe their post-onset labor market experience, including employment rates and earnings losses by type of impairment.

This article describes the de facto standards of low income and resources reflected in the eligibility standards of the largest means-tested programs that serve the elderly and then applies these standards to a near-elderly cohort. Through juxtaposing retirement resources in the near-elderly time period with program participation in the elderly time period, the author indirectly examines some of the changes between the two time periods that could affect program eligibility, including spend-down of resources and marital dissolution. Retirement resource levels are estimated using the Survey of Income and Program Participation, and subsequent participation in one of the means-tested programs--Supplemental Security Income (SSI)--is examined using matched administrative records. Although spend-down of resources is shown to occur for only 8.7 percent of eventual SSI program participants, it is more common in the part of the near-elderly population that faces the greatest incentive to decrease resource levels.