Aging baby boomers and unemployed workers have swamped the Social Security disability program with claims for benefits, which has sent the system – which was already facing a financial struggle – to the point of near insolvency.
Since ten years ago, applications have increased by almost 50 percent, as individuals with disabilities are laid off and cannot find employment within an economy that has dropped almost 7 million jobs.
The flood of benefits claims has created an increasing applicant backlog – many of whom must wait two years before their cases will see resolution – and this problem is making the cash-strapped program’s financial situation even worse.
Recent estimates from Congress have said that the Social Security disability program’s supporting trust fund will have run dry by the year 2017, which will leave the system incapable of paying full benefits unless something is done.
The news didn’t end there. The Social Security retirement fund, which is much larger than the disability program’s fund, is also forecasted to run out approximately two decades after that, so that those benefits will also go unpaid. A great deal of Washington’s focus has gone to the repair of the retirement system.
Proposals to repair the direction in which the system is headed include raising the age of retirement as well as having means-testing benefits for retirees who are wealthier.
On the other hand, though, the disability systems’ situation is much more challenging. Social Security’s overseeing trustees are asking Congress to rescue the disability system through the reallocation of funds from the retirement program, as was the case back in 1994. If Congress doesn’t do anything , After the funds run dry in 2017, the disability system will collect only enough through payroll taxes to cover approximately 85 percent of benefits.