Lack of Funds Could Mean Cuts in Social Security Disability Benefits Next Year


Social Security’s Disability Trust Fund has long suffered shortages and the threat of depletion, but next year, it may be disabled Americans who suffer the dire, direct effects.

As the situation currently stands, the Social Security Trust Fund will be able to pay out only 81 percent of scheduled disability benefits for 2016 and beyond, according to a recently released report from the fund’s trustees. If Congress doesn’t act soon, disabled citizens won’t receive the benefits they need and deserve.

The Danger of Cutting Benefits

Nearly 11 million people receive Social Security disability benefits. For many, those benefits are absolutely vital to making ends meet. People who receive benefits are unable to work due to their disability, so Social Security represents their sole source of income in many cases.

As it is, most collect an average of just $14,000 a year, and cuts would reduce that sum to around $11,340, according to an article in the New York Times. The gap in funding has been long predicted, but not enough has ever done to forestall it.

The Board of Trustees’ new report claims that the potential disability benefits cuts are symptoms of deeper problems underlying every Social Security and Medicare program. If nothing changes, disability benefits may simply be the first in a wave of cuts, later extending to Medicare and retirement benefits. In fact, Medicare’s hospital trust fund could be depleted by 2030.

The Need for Reform

The problem of cuts in benefits is complex and has many causes, including the retiring baby boomer generation, shifting demographics and recent expansions in who is covered. Simply put, there is not enough revenue from payroll taxes to cover promised benefits.

Social Security has not been seriously reformed since 1983, which was the same year that a government commission predicted the 2016 depletions. Both Democrats and Republicans oppose the projected cuts, but finding a solution may prove to be a challenge.

President Obama has suggested temporarily shifting funds from Social Security retirement payroll tax revenues, though Republicans oppose that proposal. The president has also suggested making it impossible to collect disability benefits and retirement benefits at the same time (which is currently allowed).

As for Republicans, many would like to increase restrictions on eligibility, reduce scheduled payouts, enact programs to help disabled people return to work and find ways to combat fraud. There is also some bipartisan support for making structural changes that may not prevent short-term cuts, but could restore Social Security’s funds in the long term. Ultimately, these might include streamlining the determination process and increasing payroll taxes.

Even if there is no bilateral agreement on what must be done, policymakers cannot afford to wait. Waiting will mean allowing millions of Americans to go without the benefits they so desperately need and are entitled to receive. Decisive measures must be taken to prevent the immediate cuts, and long-term strategies must be enacted to protect future disabled American citizens.

At Marasco & Nesselbush, our disability benefits attorneys are dedicated to helping each of our clients receive the maximum benefits they are entitled to, so that they can focus on their lives. If you have questions about your claim, don’t hesitate to contact a Rhode Island SSD attorney at Marasco & Nesselbush.

Contact us now for a free consultation. Call us at 401-443-2999 or fill out a contact form to set up a free legal consultation. We have four offices in Providence, Wakefield, Warwick and Woonsocket to easily serve you.