The Bipartisan Budget Act of 2015 (BBA) mandates that the Social Security Administration (SSA) conduct a “Promoting Opportunity Demonstration Project” (POD) to evaluate the effects of altering the treatment of earnings in calculation of benefits for Social Security Disability Insurance (SSDI) beneficiaries who return to work. The change proposed would increase work incentives for some SSDI beneficiaries but reduce them for others. However, because of other requirements contained within the BBA, the POD cannot produce reliable evidence on the impact of the innovation Congress envisions, and it unnecessarily replicates another SSA demonstration, the Benefit Offset National Demonstration (BOND), that is already well underway. This paper, prepared for the Social Security Advisory Board, reviews current policy, outlines the changes proposed for the POD, and shows why restrictions included in the mandate would prevent the POD from yielding results helpful for guiding policy. It also summarizes important insights already gained from the ongoing BOND evaluation. In light of these insights and the problems with the POD design, Congress and the public would be better served if the SSA were allowed to invest research funds and management effort elsewhere.
Interactions and overlap of social assistance programs across clients interest policymakers because such interactions affect both the clients’ well-being and the programs’ efficiency. This article investigates the connections between Supplemental Security Income (SSI) and Temporary Assistance for Needy Families (TANF) and TANF’s predecessor, the Aid to Families with Dependent Children (AFDC) program. Connections between receipt of TANF and SSI are widely discussed in both disability policy and poverty research literatures because many families receiving TANF report disabilities.
For both states and the individuals involved, it is generally financially advantageous for adults and children with disabilities to transfer from TANF to SSI. States gain because the federal government pays for the SSI benefit, and states can then use the TANF savings for other purposes. The families gain because the SSI benefits they acquire are greater than the TANF benefits they lose. The payoff to states from transferring welfare recipients to SSI was substantially increased when Congress replaced AFDC with TANF in 1996. States retained less than half of any savings achieved through such transfers under AFDC, but they retain all of the savings under TANF. Also, the work participation requirements under TANF have obligated states to address the work support needs of adults with disabilities who remain in TANF, and states can avoid these costs if adults have disabilities that satisfy SSI eligibility requirements. The incentive for TANF recipients to apply for SSI has increased over time as inflation has caused real TANF benefits to fall relative to payments received by SSI recipients.
Trends in the financial incentives for transfer to SSI have not been studied in detail, and reliable general data on the extent of the interaction between TANF and SSI are scarce. In addition, some estimates of the prevalence of TANF receipt among SSI awardees are flawed because they fail to include adults receiving benefits in TANF-related Separate State Programs (SSPs). SSPs are assistance programs that are administered by TANF agencies but are paid for wholly from state funds. When the programs are conducted in a manner consistent with federal regulations, the money states spend on SSPs counts toward federal maintenance-of-effort (MOE) requirements, under which states must sustain a certain level of contribution to the costs of TANF and approved related activities. SSPs are used for a variety of purposes, including support of families who are in the process of applying for SSI. Until very recently, families receiving cash benefits through SSPs were not subject to TANF’s work participation requirements.
This article contributes to analysis of the interaction between TANF and SSI by evaluating the financial consequences of TANF-to-SSI transfer and developing new estimates of both the prevalence of receipt of SSI benefits among families receiving cash assistance from TANF and the proportion of new SSI awards that go to adults and children residing in families receiving TANF or TANF-related benefits in SSPs.
Using data from the Urban Institute’s Welfare Rules Database, we find that by 2003 an SSI award for a child in a three-person family dependent on TANF increased family income by 103.5 percent on average across states; an award to the adult in such a family increased income by 115.4 percent. The gain from both child and adult transfers increased by about 6 percent between 1996 (the eve of the welfare reform that produced TANF) and 2003.
Using data from the Department of Health and Human Services’ TANF/SSP Recipient Family Characteristics Survey, we estimate that 16 percent of families receiving TANF/SSP support in federal fiscal year 2003 included an adult or child SSI recipient. This proportion has increased slightly since fiscal year 2000.
The Social Security Administration’s current procedures for tabulating characteristics of new SSI awardees do not recognize SSP receipt as TANF. We use differences in reported TANF-to-SSI flows between states with and without Separate State Programs to estimate the understatement of the prevalence of TANF-related SSI awards in states with SSPs. The results indicate that the absolute number of awards to AFDC (and subsequently) TANF/SSP recipients has declined by 42 percent for children and 25 percent for adults since the early 1990s. This result is a product of the decline in welfare caseloads. However, the monthly incidence of such awards has gone up—from less than 1 per 1,000 child recipients in calendar years 1991–1993 to 1.3 per 1,000 in 2001–2003 and, for adult recipients, from 1.6 per 1,000 in 1991–1993 to 4 per 1,000 in 2001–2003.
From these results we conclude that a significant proportion of each year’s SSI awards to disabled nonelderly people go to TANF/SSP recipients, and many families that receive TANF/SSP support include adults, children, or both who receive SSI. Given the Social Security Administration’s efforts to improve eligibility assessment for applicants, to ensure timely access to SSI benefits for those who qualify, and to improve prospects for eventual employment of the disabled, there is definitely a basis for working with TANF authorities both nationally and locally on service coordination and on smoothing the process of SSI eligibility assessment.
The Deficit Reduction Act of 2005 reauthorized TANF through fiscal year 2010, but with some rules changes that are important in light of the analysis presented in this article. The new law substantially increases effective federal requirements for work participation by adult TANF recipients and mandates that adults in Separate State Programs be included in participation requirements beginning in fiscal year 2007. Thus SSPs will no longer provide a means for exempting from work requirements families that are in the process of applying for SSI, and the increased emphasis on work participation could result in more SSI applications from adult TANF recipients.
Wiseman, Michael, and Wamhoff, Steve. The TANF-SSI Connection.” Social Security Bulletin. Vol. 66, No. 4, 2005/2006.
The Food Stamp Program (FSP) and Supplemental Security Income (SSI) are important parts of national public assistance policy, and there is considerable overlap in the populations that the programs serve. About half of all SSI recipients reside in FSP recipient households. This article uses Social Security administrative data and the Food Stamp Quality Control samples for federal fiscal years 2001–2006 to study the prevalence of food stamp receipt among households with SSI recipients, the contribution of FSP to household income, and the importance of various FSP features in contributing to the well-being of recipient households. The prevalence of FSP participation among households that include SSI recipients is estimated to have grown steadily over the entire 2001–2006 period, rising from 47.4 percent in 2001 to 55.6 percent in 2006. This growth has occurred across all age groups of SSI recipients. The FSP contribution to household income has grown as well. In 2001, FSP increased the income of the households of SSI/FSP recipients by 13 percent; by 2006 the increase was 16.8 percent. Almost 80 percent of the food stamp recipient households that include SSI recipients receive increased benefits because of excess housing costs. In 2006, 44 percent of SSI recipients lived in households that did not receive food stamps. Given available information, it is difficult to gauge the FSP eligibility of nonparticipating households and, therefore, to assess the potential benefit of outreach efforts. Currently available measures of FSP take-up probably overstate participation among eligible households that include SSI recipients, and there is some evidence that enhanced state promotion of the FSP raises participation among households with SSI recipients. We conclude with recommendation for review and renewal of collaboration between the Food and Nutrition Service of the U.S. Department of Agriculture (the agency responsible for administering the FSP) and the Social Security Administration in ensuring that eligible SSI recipients utilize FSP benefits.
Wiseman, Michael, and Trenkamp, Brad. “Food Stamps and Supplemental Security Income.” Social Security Bulletin. Vol. 67, No. 4, 2007.
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Recently various analysts have called attention to the apparent success of the Canadian social assistance system in reducing poverty among the elderly and have suggested that there may be lessons to be drawn from the Canadian experience that are relevant to the evolution of the U.S. Supplemental Security Income (SSI) program. This article profiles the Canadian system, compares the system to the U.S. SSI program, reviews the consequences for elderly poverty rates, assesses system costs, and then comments on pertinence of the Canadian experience to SSI policy. The Canadian minimum income guarantee for the elderly is substantially more generous than what is provided by the United States, but it is misleading to claim that the Canadian system costs only “slightly more” than the U.S. program. Such a judgment overlooks a key and costly part of the Canadian system, the Old Age Security demogrant. We estimate the total costs to Canada of providing income support for elderly persons receiving a Guaranteed Income Supplement (GIS) in 2004 to be approximately C$13.3 billion (roughly US$11.1 billion), slightly more than 1 percent of gross domestic product (GDP) and almost fourteen times the U.S. allocation for SSI and food stamps for elderly SSI recipients. The significance of this commitment is underscored when it is recognized that in 2004 Canadian GDP per capita was just 80 percent of the U.S. level. The Canadian example suggests U.S. policymakers consider better integration of SSI with basic Social Security benefits, experimenting with alternatives to restricting SSI eligibility to individuals with very few assets, and reducing barriers to program access.
Wiseman, Michael, and Ycas, Martynas. “The Canadian Safety Net for the Elderly.” Social Security Bulletin. Vol. 68, No. 2, 2008.
In the United States, poverty is generally assessed on the basis of income, as reported in the Current Population Survey’s (CPS’s) Annual Social and Economic Supplement (ASEC), using an official poverty standard established in the 1960s. The prevalence of receipt of means-tested transfers is underreported in the CPS, with uncertain consequences for the measurement of poverty rates by both the official standard and by using alternative “rela¬tive” measures linked to the contemporaneous income distribution. The article reports results estimating the prevalence of poverty in 2002. We complete this effort by using a version of the 2003 CPS/ASEC for which a substantial majority (76 percent) of respondents have individual records matching administrative data from the Social Security Administration on earnings and receipt of income from the Old-Age, Survivors, and Disability Insurance and Supplemental Security Income (SSI) programs. Adjustment of the CPS income data with adminis-trative data substantially improves coverage of SSI receipt. The consequence for general poverty is sensitive to the merge procedures employed, but under both sets of merge procedures considered, the estimated poverty rate among all elderly persons and among elderly SSI recipients is substantially less than rates estimated using the unadjusted CPS. The effect of the administrative adjustment is less significant for perception of relative poverty than for absolute poverty. We emphasize the effect of these adjustments on perception of poverty among the elderly in general and elderly SSI recipients in particular.
Wiseman, Michael, and Nicholas, Joyce. “Elderly Poverty and Supplemental Security Income.” Social Security Bulletin. Vol. 69, No. 1, 2009, 45-73.
Abstract: The Supplemental Security Income (SSI) program is the nation’s safety net for the aged, blind, and disabled. SSI receipt is often not reported by individuals interviewed in the Current Population Survey (CPS), the statistical base for the Census Bureau’s annual estimates of poverty rates. In an earlier article, we explored the effect on estimated poverty rates in 2002 of adjusting CPS income reports using administrative data on earnings and benefits from the SSI and Old-Age, Survivors, and Disability Insurance programs. We assessed poverty using both the official standard and a “relative” standard based on half of median pretax, posttransfer income. This article extends that work through 2005. We find that including administrative data presents challenges, but under the methodology we adopt, such adjustments lower estimated official poverty overall and increase estimated poverty rates for elderly SSI recipients. Relative poverty rates are much higher than official poverty rates. By any of the applied standards and procedures for income adjustment, poverty changed little over the 2002–2005 interval.
Suggested citation: Wiseman, Michael, and Nicholas, Joyce. “Elderly Poverty and Supplemental Security Income, 2002-2005.” Social Security Bulletin. Vol. 70, No. 2, 2010, 1-29.
Supplemental Security Income (SSI) is an odd combination of income support for families with disabled children, disabled working-age adults, and elderly persons with inadequate retirement incomes. Less than three percent of Americans receive SSI payments. The program faces challenges on all three fronts: Payments for children with disabilities bear little relationship to family need or costs associated with caring for disabled children. State efforts to promote transition of children and adults from general assistance and TANF to SSI appear driven by fiscal considerations with little attention to health, functioning, and social integration objectives. Measuring the impact of poverty among the elderly is hampered by severe underreporting of benefits in survey data, most notably the Current Population Survey. This paper argues that SSI serves important purposes, but that all three target populations, especially children, might be served best by gradual decoupling or at least improved integration with other programs targeted to each of the three groups.
Wiseman, Michael. “Supplemental Security Income for the Second Decade.” Poverty & Public Policy. Vol. 3, No. 1 2011, 1-18.