Recently, the Senate Finance Committee held a hearing on the nightmare that surrounds people with disabilities who rely on Social Security Insurance (SSI) and Social Security Disability Insurance (SSDI). Federal and state officials testified about the challenges in administering SSI and SSDI, and how Congress might intervene to make the entire process more effective, efficient, and user-friendly.

There are numerous significant challenges. Testimony revealed what many people with disabilities already know from painful and frustrating personal experiences of SSI and SSDI: These programs and policies are largely dysfunctional, and are often unable to perform necessary and routine tasks to ensure that people with disabilities receive the services they are entitled to. This pervasive dysfunction is caused by a plethora of rules, regulations, and policies that are at worst contradictory and at best disconnected from each other. Furthermore, SSI and SSDI present major “red tape” scenarios that in most cases leave people with disabilities and their families confused, anxious, frustrated, and hopeless.

The challenges don’t stop there. Astonishingly, many SSI and SSDI policies and programs have not had major updates in 40 years. For example, current asset limits have not been revised nor raised in decades. There have been no adjustments for inflation, leading to asset limits being worth far less than when they were initially implemented. Overall, when solutions have been suggested, the Social Security Administration has failed to implement fixes.

Another major problem relates to SSDI overpayments: The intent of SSDI is to support people with disabilities in finding and keeping a job to make them more independent and productive members of society. However, increased earned income often results in discrepancies within SSDI payment formulas which are often overlooked or delayed for years, resulting in program overpayment -- often by very large amounts of money. When this occurs, recipients receive huge “claw-back” bills to reimburse the federal government. Senators shared horror stories of recipients unexpectedly receiving bills for repayment of tens of thousands of dollars. Making matters even worse, SSDI spends enormous sums on tracking overpayment, far in excess of the overpayment money recovered.

In a related challenge, transition programs to get people with disabilities working while slowly reducing their benefits as their pay rises, such as the “Ticket to Work Program,” are not working effectively or efficiently. This reduces the incentive of people with disabilities to find and maintain employment.

The problems are not limited to recipients of these programs.

Program complexity, rules, and policies are so convoluted that even highly experienced employees are unable to untangle the regulations for recipients who inquire about their SSDI status and when problems arise. Individuals’ initial contacts about SSDI problems or questions are always routed to entry-level staff with very little training, who are unable to provide crucial initial guidance. To complicate things, staff are massively overloaded, leading to excessive delays and increasing the likelihood of errors -- further complicating the service processes.

One example of this labyrinthine mess will suffice: In a twist of ineffective and inefficient service delivery, hundreds of millions of dollars were spent on updating a 1991 directory of disability job categories. While many of these jobs no longer exist (e.g. elevator attendant) many others that are now routine were not known in the early 90s (e.g. computer coding). The updated version of the directory has never been implemented.

Some proposed commonsensical solutions followed. Presenters suggested that better management of overpayments and claw-back bills would make the system more efficient so that sudden, unexpected payback bills do not surprise recipients and their families. There was general support for reassessing the “Ticket to Work Program” to see what’s working and what’s not. Thus far, results have been inconclusive and researching program efficiency has been expensive. Additionally, it’s expensive to better train staff and use extant data and research to illustrate improvement -- neither of which has been implemented.

While Able Americans applauds the bipartisan focus on this issue, it is clear federal programs across the Social Security Administration, including SSI and SSDI, are routinely ineffective and inefficient.

Given its history of not establishing significant changes, the potential for a swift future endowment seems low.

We suggest that it is time to examine free-market solutions to these intractable problems rather than relying on a sclerotic federal government where the potential for positive change is minimal.

Image: Social Security Administration