Some commentators speculate that Social Security Disability Insurance (SSDI) is in trouble due the considerable ongoing shortfalls faced by the Social Security Administration (SSA). The Trustees of the Social Security and Medicare trust funds, who had previously assured Americans that retirement and survivor benefits would not exceed tax receipts until 2018, recently announced that this occurred in fiscal 2010.
More to the point for those who receive or will someday need Social Security disability benefits, the trustees predict that the Disability Insurance (DI) Trust Fund will become exhausted in 2018, two years earlier than their previous prediction. SSDI costs began to exceed tax revenues in 2005, and the trustees caution that changes to enhance the financial health of the program are immediately necessary.
The trustees - Treasury Secretary Timothy Geithner, Heath and Human Services Secretary, Kathleen Sebelius, Secretary of Labor Hilda Solis, and Commissioner of Social Security Michael J. Astrue - project that Social Security's Old-Age and Survivors Insurance (OASI) Trust Fund is adequately funded through 2040. But they caution that the DI Trust Fund fails the short-range test of financial adequacy, and advise a swift response: "The sooner action is taken to address the long-run financial imbalances, the more reform options will be available, and the more time there will be to phase in changes so that those affected will have adequate time to prepare."
Thousands of New York families rely on Social Security disability benefits for shelter and other basic needs, and federal lawmakers need to craft solutions to continue to deliver the most important source of support for disabled Americans. While many economists predict that an end to the recession will cause a significant rebound in the payroll taxes that fund SSA programs, the specter of a "jobless" recovery still looms. The immediate nature of the SSDI shortfall demands swift, bipartisan cooperation.
Sources: SSA.gov, "Status of the Social Security and Medicare Programs" ; DailyFinance.com, "Social Security is in far worse shape than you think" Jan. 19, 2011.