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Expert: Social Security disability program ‘backdoor welfare’

By   /   July 17, 2013  /   6 Comments

HARRISBURG – With record numbers of people collecting benefits through a Social Security program for disabled workers, there are concerns that some might be abusing the system.

And even if not, the system might not be sustainable at current levels.

CONGRATULATIONS, YOU’RE APPROVED: Disabled workers can get $720 per month from the federal government. But in this day and age, shouldn’t there be fewer disabled workers, not more?

Tad DeHaven, a research associate with the Cato Institute, a libertarian think tank, examines government programs for a living, but he said he’s never seen one as ill-defined and exploited as the Social Security disability trust fund.

“It is so obviously abused and so obviously become something it was never meant to be,” he said.

Originally, disability coverage through Social Security was only for workers over age 50 and under age 64. As such, it served as a kind of pre-social security for those who could no longer work due to medical issues.

But in recent years, the number of workers receiving disability checks has shot upwards at an alarming rate.

Nationally, the number of disability beneficiaries rose by 39 percent between 2003 and 2011.  In Pennsylvania, the rate climbed by 50 percent during the same period.  More than 300,000 Pennsylvanians now collect a monthly social security disability check.

The recent rise in disability payments is also counterintuitive.  In a day and age when medical advances mean people are living longer and healthier lives than ever before, shouldn’t there be fewer disabled workers?

DeHaven says it is because Congress has expanded eligibility to the point that Social Security disability has been turned into “a back-door welfare program” for states to use.

An individual in Pennsylvania who qualifies for social security disability payments will receive a base monthly benefit of $720. Beneficiaries with spouses, children or other dependents can qualify for as much as $1,300 each month.

The vast majority of those benefits are paid by the federal government – Pennsylvania only kicks in about $20 of the $720 monthly payment for unattached individuals – so states have little incentive to care about how many people are qualified for benefits or to root out fraud in the system.

“Traditional welfare is shared by the state and federal government, so there is some incentive for the states to stay on top of things,” DeHaven said. “What we have now is designed to be abused.”

And there is plenty of money to be made as well.  About 70 percent of applicants are rejected when they apply for disability benefits, so many seek legal help in filing appeals through the state-run systems.  Law firms have cashed in by trying to attract as many potential beneficiaries as possible, and websites like DisabilitySecrets.com make it easy for potential clients to find law firms.

When it comes to qualifying for benefits, it’s about more than just being disabled, said W. Daniel Feehan, an attorney who works on disability claims at the Montgomery County law firm of Lowenthal and Abrams.

An individual has to show they are unable to find a job, which can be as much about their own skills and level of education as it is about their physical fitness.

“The qualifications for the program are both medical and vocational,” he said.

But Feehan does not see the program as an open-ended welfare scheme like DeHaven does.

“Under the social security disability program, people are getting money they are entitled to that has been taken out of their paychecks over the years,” he said. “It’s disingenuous to call it a hand-out.”

There are concerns about the sustainability of the program.  The Congressional Budget Office estimates the Social Security disability trust fund will run dry as soon as 2016.

As more people collect benefits from the system, there are fewer workers paying into it.

According to the Bureau of Labor Statistics, in 1968 there were about 51 full-time workers for each worker collecting disability. By April 2013, there were only 13 Americans working full time for each worker on disability.

Boehm is a reporter for PA Independent and Watchdog.org.  He can be reached at Eric@PAIndependent.com

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Eric is a reporter for Watchdog.org and former bureau chief for Pennsylvania Independent. He lives in Minneapolis, Minnesota, where he enjoys great weather and low taxes while writing about state governments, pensions, labor issues and economic/civil liberty. Previously, he worked for more than three years in Harrisburg, Pennsylvania, covering Pennsylvania state politics and occasionally sneaking across the border to Delaware to buy six-packs of beer. He has also lived (in order of desirability) in Brussels, Belgium, Pennsburg, Pa., Fairfield, Conn., and Rochester, N.Y. His work has appeared in Reason Magazine, National Review Online, The Freeman Magazine, The Philadelphia Inquirer, The Washington Examiner and elsewhere. He received a bachelor's degree from Fairfield University in 2009, but he refuses to hang on his wall until his student loans are fully paid off sometime in the mid-2020s. When he steps away from the computer, he enjoys drinking craft beers in classy bars, cheering for an eclectic mix of favorite sports teams (mostly based in Philadelphia) and traveling to new places.

  • Sunflower girl

    I have issues with all of this written above. first of all I am a disabled person, having suffered a stroke and also have many other health issues! I had to apply for disability benefits many times, lots of paper work by the way, which is a real job in it self….I was turned down many times, and it wasn’t until I said I was hiring an attorney to help me to proceed with the benefits did they take another look at my circumstances. I am now over 65 so of course, I receive my regular social security benefits. I know many others with my similar health issues that have been trying for years to receive social security disability and are going through exactly what I went through so I am very shocked at your article!! just doesn’t seem plausible to me. thank you.

  • Leanne Musson Watts

    I have a neurological disorder and had to quit because I was driving a distance and the prescription side effects were making me fall asleep at the wheel. I have been unemployed for over two years now and because I can’t be on my feet, and it keeps me from working almost any job out there. I’m a bookkeeper, but there are no jobs available locally.

    I’ve been paying for my disability insurance for almost 40 years, yet I have been turned down twice. I am currently awaiting word on my last hearing, which I finally had to seek legal help to get.

    What makes me mad is the people that I know are on disability and I see them out mowing their yards, trimming trees, going to all kind of sports functions….. I can barely stand/walk for an hour to do my grocery shopping once a week IF I rest every so often! Why aren’t these people working?? If there are no jobs, that’s one thing. But if they’re disabled, why are they able to do what I see them doing?? I’d be happy to take up waitressing again – done it before. I’d even be happy to work at a fast food counter – I’ve done that too. But not many places will hire you on a scooter….

    It is NOT a handout like people like to make it sound. It’s like car insurance and I wrecked my car! If the government had put that money aside and left it alone there’d be no problem. Being a bookkeeper I did payroll for decades and know that all the monies sent in are split and categorized. They know exactly how much you paid in for each item: state unemployment insurance, Federal unemployment insurance, Workman’s Comp. insurance, disability insurance… Notice it says INSURANCE and not WELFARE?

    But, as usually happens, they dipped into the funds for something else and never replaced it. So now the program is in trouble and instead of helping to fix the problem by replacing what was stolen from that account, our agencies are hurriedly spending million$ on stupid things to use up their budgeted money instead of handing it back, afraid that doing so would make next year’s budget smaller (SO WHAT?), The First Family is taking numerous vacations a year at our expense (when we can’t even afford to go see family), politicians are jetting all over the country instead of saving OUR money for OUR due!

    It all just makes me sick to see how greedy our government has gotten! And it’s us, we, you and I, the American citizens that have paid for it and will continue to do so until they break our backs and leave us another Greece, and blame US for it, for having the audacity to age and become unable to work and support THEM. And they call it a benefit…….

  • shygrl

    The increase in those receiving social security disability has been influenced by the surge in people reaching age 50 or more and realizing disabilities that prevent them from work. This report has ignorantly ignored our aging population and also increases in the rates of cancers. If you take a look at the actuary information about probability of health issues by age available on the social security web site, you will quickly observe why increases in the numbers of beneficiaries has occurred. For many of us who receive these benefits, we have worked and paid into this insurance fund for 35 years or more and would be grateful to continue to work rather than have to live on less than 25 percent of what we could be making in our work! Sure, there is probably some fraud going on but for the most part, most who receive these payments are truly disabled and had to fight very hard to finally begin receiving these benefits.

  • Francine Roback

    I believe the social security administration is in dire need of an overhaul as it relates to disability benefits. To have a disabled worker wait long periods of time for a favorable review is unbelievable. Most of those who apply for disability benefits lose their homes, their credit worthiness and their peace of mind waiting for a decision. The backlog of these cases amount to years of waiting for a hearing. Many times claimants do not fit into a prescribed “listing” and are denied even though their disability makes them unable to be gainfully employed.

    I do not understand why obvious disabilities are denied at the initial level and only after one resorts to hiring an attorney is a favorable decision reached. It is a lucrative occupation for disability attorneys who stand to gain 25% of a back award. Many of these cases should be won without attorney representation, but if you do not have representation one stands to be denied again and continue to wait years for a decision.

    It is a system that needs immediate attention. I also do not understand why when one is found disabled, that they must wait two years for Medicare and why is there a five month waiting period before benefits begin. If one is disabled, then one should be receiving an award without an additional delay.

  • Jerry

    Tax the fuck out of the wealthy and put leans against them if they even threaten to pass those increases on to the consumers. Don’t fuck with us! Close all tax loopholes and increase social security payouts so we can buy our own insurance through Obama care. That’s how you deal with Medicaid, which is the real problem.

  • Carl Bingum

    I am on disability now for 16 years. It has been a blessing for sure I would have not made it without it. I want to work and can’t. I don’t have the education to be able to work off my feet. I have physical and mental health disabilities. I cannot stand more then 5 or 10 minutes and can’t walk very far. It makes it very difficult to be able to work. I would love to have an income from work that I can actually live on. I am forced to live in an abusive situation with my family cuz I can’t afford to go out and rent an apartment. They don’t give you enough to be able to live independently. I also have bipolar disorder which is hell by the way. I have gained 200 pounds from all the psychiatric treatments. I now feel trapped by my income as well as my weight. I don’t know what to do to turn it all around. And for people that think mental illness is an excuse I say you are wrong. I have been through electric shock therapy trying to help myself and ended up worse off. I get mad when I see people on disability that shouldn’t be on it. There are so many that are scamming the system. And people that have their unemployement money run out are now applying for disability. I also am furious when I see able bodied people getting section 8 housing and I can’t get on a wait list for it when I am the disabled person. It is awful. I mean people that should be getting disability can’t get it and people that shouldn’t be getting it claim they are depressed and get it. I have a lifetime of mental health issues to prove my mental illness. Nowadays people that simply go to a psychiatrist turn around and get disability for it. It is not right. I understand that people can’t afford to feed their families and have to do anything to put food on the table. But, the answer is not social security fo them. The answer is to create jobs and boost the economy. Obama is turning the country into a welfare system.

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