Work and Social Security Disability Benefits: Addressing Challenges and Creating Opportunities
Statement of
William R. Morton
Analyst in Income Security
Before
Finance Committee
U.S. Senate
Hearing on
“Work and Social Security Disability Benefits:
Addressing Challenges and Creating
Opportunities”
June 18, 2024
Congressional Research Service
https://crsreports.congress.gov
TE10103
Congressional Research Service
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Chairman Wyden, Ranking Member Crapo, and other distinguished Members of the Committee, my name
is Will Morton, and I am an Analyst in Income Security at the Congressional Research Service (CRS).
Thank you for the opportunity to testify on Work and Social Security Disability Benefits: Addressing
Challenges and Creating Opportunities. My testimony will provide an overview of the Social Security
Administration’s (SSA’s) disability programs, a brief history of efforts to promote work among disability
beneficiaries, and a discussion of selected issues concerning work and SSA’s disability programs.
Overview of SSA’s Disability Programs
Background
SSA oversees two federal programs that provide income support to qualified individuals who meet the
statutory definition of disability: Social Security Disability Insurance (SSDI) and Supplemental
Security Income (SSI).1
SSDI is part of the Old-Age, Survivors, and Disability Insurance program, commonly known as Social
Security. Social Security is a federal social insurance program that provides monthly cash benefits to
insured workers and their eligible family members in the event of the worker’s retirement, disability, or
death. Workers obtain insurance protection by working for a sufficient period in jobs covered by Social
Security and its payroll tax, and benefits are based on a worker’s past earnings in covered jobs. The
program is financed primarily by payroll taxes levied on the earnings of covered workers, which are
credited to two separate trust funds. The SSDI component provides benefits to disabled workers who are
below Social Security’s full retirement age (65-67, depending on year of birth) and to their eligible family
members. Social Security also provides benefits to disabled widow(er)s and disabled adult children of
retired, disabled, or deceased insured workers. Social Security disability beneficiaries automatically
qualify for health care coverage under Medicare, generally after satisfying a 24-month waiting period.
In contrast, SSI is a federal means-tested program that provides monthly cash benefits to eligible adults
and children who meet the program’s definition of disability and to eligible adults age 65 or older,
regardless of their disability status. The program is intended to provide a guaranteed minimum level of
income to people who have difficulty meeting their basic living expenses due to disability or age and who
have little or no Social Security or other income. There are no work or contribution requirements to
qualify for SSI. However, because the program is based on need, it is restricted to people whose countable
income and resources (assets) are within statutorily prescribed limits. SSI provides a uniform maximum
benefit of $943 per month for individuals in 2024, which is reduced by any countable income (e.g., Social
Security benefits, earnings from work).2 SSI is financed by annual appropriations from the general fund.
Some states use their own funds to supplement the federal SSI benefit. In most states, SSI recipients
automatically qualify for health care coverage under Medicaid.
In April 2024, SSA paid $12.5 billion in total monthly benefits to 8.6 million Social Security disability
beneficiaries and paid $3.3 billion in total monthly benefits to 4.0 million SSI recipients ages 18-64.3
About one-quarter of SSI recipients ages 18-64 also received Social Security benefits that month.
1 For more information, see CRS In Focus IF10506, Social Security Disability Insurance (SSDI), CRS In Focus IF10482,
Supplemental Security Income (SSI), and CRS Report R44948, Social Security Disability Insurance (SSDI) and Supplemental
Security Income (SSI): Eligibility, Benefits, and Financing.
2 SSA, “SSI Federal Payment Amounts,” https://www.ssa.gov/oact/cola/SSIamts.html.
3 SSA, “Monthly Statistical Snapshot, April 2024,” Tables 2 and 3, https://www.ssa.gov/policy/docs/quickfacts/stat_snapshot/;
SSA, “Benefits Paid By Type Of Beneficiary,” https://www.ssa.gov/oact/ProgData/icp.html; and SSA, “SSI Monthly Statistics,
April 2024,” Table 1, https://www.ssa.gov/policy/docs/statcomps/ssi_monthly/index.html. Social Security disability beneficiaries
include disabled workers, disabled widow(er)s, and disabled adult children.
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Definition of Disability
SSDI and SSI use the same work-based definition of disability for adults. The Social Security Act defines
disability as the inability to engage in any substantial gainful activity due to any medically determinable
physical or mental impairment that (1) is expected to result in death or (2) has lasted, or is expected to
last, for at least 12 consecutive months.4 The impairment (or combination of impairments) must be severe
enough to prevent the individual from performing both their previous work (if any) and any other kind of
substantial gainful work that exists in significant numbers in the national economy, taking into
consideration their age, education, and work experience. This definition of disability is generally
considered total and long term. Unlike state workers’ compensation or veterans’ disability compensation,
SSDI and SSI do not pay benefits for partial or short-term disabilities.
SSA defines substantial gainful activity (SGA) as work that involves doing significant and productive
physical or mental duties and which is done (or intended) for pay or profit.5 Work activity is ordinarily
considered significant if it results in earnings that exceed the agency’s SGA earnings level.6 In 2024, the
SGA earnings level is $1,550 per month for most individuals.7 Individuals with monthly earnings that
exceed the SGA earnings level are generally considered able to engage in SGA and thus do not meet the
definition of disability (certain exceptions apply). The SGA earnings level is a proxy measure for the
inability to perform substantial work; it is not designed to be a financial eligibility or means test.
SSA performs periodic medical reviews to verify that SSDI and SSI disability beneficiaries continue to
meet the definition of disability in the Social Security Act. Medical continuing disability reviews (CDRs)
are scheduled based on the likelihood of medical improvement. Individuals considered likely to improve
medically are scheduled for a review once every six to 18 months, while those considered not likely to
improve medically are scheduled for a review once every five to seven years. Those who cannot be
assigned to one of the other categories are scheduled for a medical review once every three years.
Program Rules Concerning Work Activity and Work Incentives
Although SSDI and SSI are designed to support eligible adults who cannot perform substantial work due
to their qualifying impairments, the two programs allow disability beneficiaries to work and earn within
certain limits. In addition, both SSDI and SSI include special program rules designed to encourage work
among disability beneficiaries, known as work incentives.
Under the SSDI program, work activity is governed largely by the SGA earnings level. In general, Social
Security disability beneficiaries who work must keep their earnings at or below the SGA earnings level.
Those who earn above the SGA earnings level after a certain period have their cash benefits suspended or
terminated. Because having earnings above the SGA level may result in a complete loss of SSDI cash
benefits, the SGA earnings level is often referred to as the “cash cliff.”
SSDI provides certain work incentives designed to promote work among Social Security disability
beneficiaries. For example, most beneficiaries are provided a trial work period (TWP), which allows
them to earn any amount for up to nine months within a certain period without having their benefits
suspended or terminated. Beneficiaries “use up” one of their nine TWP months when their earnings
exceed the TWP earnings level, which is $1,110 per month in 2024.8
4 Social Security Act, §§223(d)(1)(A) and 1614(a)(3)(A); 42 U.S.C. §§423(d)(1)(A) and 1382c(a)(3)(A).
5 20 C.F.R. §§404.1510 and 416.910.
6 Special rules apply to individuals who are self-employed.
7 SSA, “Substantial Gainful Activity,” https://www.ssa.gov/oact/cola/sga.html. This level is adjusted annually for average wage
growth. A higher monthly SGA earnings level applies to SSDI beneficiaries who are statutorily blind.
8 SSA, “Trial Work Period,” https://www.ssa.gov/oact/COLA/twp.html. This level is adjusted annually for average wage growth.
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Beneficiaries who exhaust the TWP enter an extended period of eligibility (EPE), which allows them to
continue to receive benefits if their earnings are at or below the SGA earnings level (generally $1,550 per
month in 2024). During the first 36 months of the EPE, benefits are suspended for months in which
earnings exceed the SGA level. After the 36-month reentitlement period, beneficiaries who earn above the
SGA level are terminated from the SSDI program. Benefits are paid for the first month in which a
beneficiary earns above the SGA level in the EPE and the next two months, called the three-month grace
period. Those whose SSDI benefits are terminated due to work and who continue to have qualifying
impairments receive extended Medicare coverage for at least 93 months after the end of the TWP.
Under the SSI program, work activity is governed largely by the program’s financial eligibility rules. In
SSI, countable income—gross income minus applicable exclusions—is subtracted from the maximum
monthly SSI benefit on a dollar-for-dollar basis in determining a person’s program eligibility and benefit
amount (if any). Individuals are ineligible for SSI if their countable income exceeds the maximum SSI
benefit. All SSI recipients are afforded certain basic income exclusions in calculating their countable
income. Specifically, SSI excludes the first $20 per month of any income and the first $65 per month of
earned income plus one-half of any earned income above $65.9 After applying the $20 and $65 per month
income exclusions, the maximum SSI benefit is reduced by $1 for every $2 of earnings (i.e., a $1-for-$2
benefit offset). Under these basic income exclusions, the level of gross income that reduces the maximum
SSI benefit to $0 for individuals with only earned income is $1,971 per month in 2024, referred to as the
earned income break-even point.
SSI provides additional work incentives designed to encourage greater work activity among recipients
with earnings. For instance, a provision known as 1619(a) allows disability recipients to earn above the
SGA level and continue to receive SSI benefits, provided their earnings and other countable income are at
or below the maximum monthly SSI benefit. Another provision, known as 1619(b), allows individuals
whose SSI benefits are reduced to $0 due to excess earnings to retain Medicaid coverage if their annual
gross earnings are at or below a state-specific threshold and they meet certain other criteria.10 In 2024, this
threshold ranges from $34,490 in Tennessee to $86,438 in Alaska.11
Some work incentives are available to disability beneficiaries under both programs. For example, Ticket
to Work (TTW) allows most SSDI and SSI disability beneficiaries ages 18-64 to obtain free employment
services, vocational rehabilitation services, and other support services from approved public or private
providers to achieve certain work-related goals. In addition, expedited reinstatement (EXR) allows former
SSDI and SSI disability beneficiaries whose entitlement ended due to work to request expedited
reinstatement of those benefits if they stop performing SGA within five years of their prior termination
and meet certain other criteria. Further, SSDI and SSI disability beneficiaries are permitted to deduct from
their earnings the reasonable cost of certain impairment-related work expenses (IRWE) for purposes of
SGA and SSI financial eligibility determinations.
Table 1 summarizes selected work incentives available under the SSDI and SSI programs. One key
difference between the two programs is that the SSDI-only work incentives are generally time limited,
whereas SSI-only work incentives are not time limited. Another key difference is that SSI recipients have
their benefits gradually offset as their earnings rise above a certain level, while SSDI beneficiaries who
work either receive their regular benefits or nothing, depending on the applicable work incentive and
whether their earnings are above the SGA level. A more extensive discussion of SSDI and SSI work
incentives can be found in SSA’s guide on work incentives and employment supports, The Red Book.12
9 The $20 per month general income exclusion and the $65 per month earned income exclusion are not adjusted for inflation.
10 For more information, see CRS Report R46111, Medicaid Eligibility: Older Adults and Individuals with Disabilities.
11 SSA, “Continued Medicaid Eligibility (Section 1619(B)),” https://www.ssa.gov/disabilityresearch/wi/1619b.htm.
12 SSA, The Red Book, https://www.ssa.gov/redbook/.
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Table 1. Selected SSDI and SSI Work Incentives, by Program Availability
Work Incentive
Description
SSDI Only
Trial Work Period
Allows beneficiaries to test their ability to work for up to 9 months (not necessarily consecutive) within a rol ing 60-month
(TWP)
period without having their benefits suspended or terminated. During the TWP, beneficiaries may earn any amount and
continue to receive their regular benefits, even if their earnings exceed the SGA level. Any month in which earnings exceed
the TWP earnings level during this period counts as a month toward the cumulative 9-month TWP. In 2024, the TWP
earnings level is $1,110 per month.
Extended Period of
Allows beneficiaries who exhaust the TWP to continue to receive benefits for months in which their earnings are at or
Eligibility (EPE)
below the SGA level (generally $1,550 per month in 2024). During the first 36-months of the EPE (known as the
“reentitlement period”), benefits are suspended for months in which earnings exceed the SGA level. In or after the 37th
month of the EPE, benefits are terminated if earnings exceed the SGA level.
3-Month Grace
Al ows beneficiaries in the EPE to receive benefits for the first month in which their earnings exceed the SGA level and the
Period
fol owing 2 months, regardless of their earnings level during the latter 2 months (if any).
Extended Medicare
Al ows individuals whose SSDI benefits are terminated due to earnings above the SGA level but who continue to have
Coverage
qualifying impairments to retain premium-free Medicare Part A coverage for at least 93 months after the end of the TWP.
Those who exhaust extended Medicare coverage and continue to have qualifying impairments may “buy into” Medicare Part
A by paying a premium.
SSI Only
Basic Income
SSA excludes the first $20 per month of any income (earned or unearned) and the first $65 per month of earned income
Exclusions
plus one-half of earned income above $65. After applying the $20 and $65 per month income exclusions, the maximum
monthly SSI benefit is reduced by $1 for every $2 of earnings (i.e., a $1-for-$2 benefit offset). Under these basic income
exclusions, the level of gross income that reduces the maximum SSI benefit to $0 for individuals with only earned income is
$1,971 per month in 2024 (known as the “earned income break-even point”).
1619(a) (Special SSI
Al ows disability recipients to earn above the SGA level if their countable income is below the maximum SSI benefit. It is
Benefits)
designed for those with earnings above the SGA level ($1,550 per month in 2024) but below the earned income break-even
point ($1,971 per month for individuals in 2024). Those in 1619(a) status receive special SSI benefits that are calculated in
the same manner as regular SSI benefits.
1619(b) (Medicaid
Al ows individuals whose SSI benefits are reduced to $0 due to excess earnings to retain Medicaid coverage if their annual
While Working)
gross earnings are at or below a state-specific threshold and they meet other criteria. Because the threshold is based, in
part, on any applicable state supplementary payments and the state’s average per capita Medicaid expenditures on disability
enrol ees, the dol ar amount varies by state. In 2024, the threshold ranges from $34,490 in Tennessee to $86,438 in Alaska.
Plan to Achieve Self-
SSA excludes the income or resources that SSI recipients set aside to pursue specific work goals. The work goal must be
Support (PASS)
feasible for the recipient, and the plan must be approved by SSA.
Both SSDI and SSI
Ticket to Work
Al ows beneficiaries ages 18-64 to obtain free employment services, vocational rehabilitation (VR) services, and other
(TTW)
support services from approved providers to achieve specific work-related goals. TTW participants are issued a “ticket,”
which they can assign to either an employment network (a qualified private or non-federal public entity) or a state VR
agency. Both parties must agree on and develop a plan that outlines the specific services that wil be provided and the
particular work-related goals that the participant aims to achieve. SSA pays providers when participants achieve certain
earnings outcomes. Participants who make timely progress toward their work-related goals are exempt from periodic
medical reviews (CDRs).
Expedited
Al ows former beneficiaries whose entitlement ended due to work to request expedited reinstatement of those benefits if
Reinstatement (EXR)
they stop performing SGA within 5 years of their prior termination and meet certain other criteria. Requesters may receive
up to 6 months of provisional cash and medical benefits while SSA conducts a medical review to decide if they qualify for
reinstatement.
Impairment-Related
Al ows beneficiaries to deduct from their earnings the reasonable cost of certain work expenses related to their
Work Expenses
impairments for purposes of SGA and SSI financial eligibility determinations (e.g., co-pays, medications, attendant care
(IRWE)
services, car modifications, service animals, and assistive technologies).
Source: CRS.
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SSA conducts periodic work and financial eligibility reviews to verify that disability beneficiaries
continue to meet relevant program requirements. For SSDI, SSA performs work CDRs to determine if
SSDI beneficiaries are working above the SGA level after the TWP. Work CDRs may be triggered based
on alerts from SSA’s CDR enforcement operations system, which uses annual earnings data from the
Internal Revenue Service (IRS) and quarterly wage data from the Office of Child Support Enforcement’s
(OCSE’s) National Directory of New Hires. For SSI, SSA performs redeterminations to determine if SSI
recipients continue to meet the program’s financial eligibility requirements (e.g., resources, earnings from
work, other income). SSI redeterminations are scheduled once every year or once every six years,
depending on the likelihood of a change in financial circumstances. SSA uses data from the IRS and
OCSE, among other sources, to conduct redeterminations.
Demonstration Projects
Starting in 1980, Congress began granting SSA the authority to test certain changes to SSDI and SSI
program rules through demonstration projects. Demonstration projects are temporary changes (i.e.,
interventions) to disability program rules that are tested on some subset of disability beneficiaries and
later evaluated.13 Congress has previously provided SSA with two separate demonstration authorities.
First, Section 234 of the Social Security Act gave SSA temporary demonstration authority to test changes
to SSDI program rules “designed to promote attachment to the labor force,” subject to certain
requirements.14 Section 234 authority last expired on December 31, 2022, and has not been renewed by
Congress. Second, Section 1110(b) of the Social Security Act gives SSA demonstration authority to test
changes to SSI program rules and early interventions, subject to certain requirements.15 Section 1110(b)
authority does not expire under current law (i.e., it is permanent).
Using its Section 234 and 1110(b) demonstration authorities, SSA has tested a variety of interventions
with different target populations and purposes. Some demonstrations have tested whether providing
employment supports or other services to disability beneficiaries affects employment outcomes (e.g.,
employment rates and earnings) and disability benefit use (e.g., the amount of disability benefits
received). Some demonstrations have targeted interventions to specific populations, such as SSI youth
entering adulthood (i.e., SSI transition-age youth). Other SSA demonstrations have tested whether
providing services to individuals before they begin receiving disability benefits affects employment
retention and disability benefit use, or whether providing SSDI beneficiaries with earlier access to
medical benefits and other services affects health outcomes and disability benefit use.
Work Activity Among SSA Disability Beneficiaries
SSA recently estimated that about 1.1 million Social Security disability beneficiaries and between
200,000 and 300,000 SSI recipients work in a given year (i.e., have positive earnings from work).16 These
figures represent about 13% of all Social Security disability beneficiaries and about 5%-7% of all
working-age SSI recipients in April 2024. In addition, about 0.6% of SSDI disabled-worker beneficiaries
had their benefits suspended due to work in December 2022 (i.e., due to earnings above the SGA level)
13 Austin Nichols, Jeffrey Hemmeter, and Debra Goetz Engler, ed., Lessons from SSA Demonstrations for Disability Policy and
Future Research (Rockville, MD: Abt Press, 2021), p. 1, https://www.ssa.gov/disabilityresearch/demonstrations/lessons.htm.
14 42 U.S.C. §434.
15 42 U.S.C. §1310(b).
16 These estimates are from a SSA proposed rule discussed later on in this statement. See footnote 41.
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and about 0.9% had their benefits terminated due to work in 2022.17 A 2011 study estimated that about
0.5% of working-age SSI recipients have their benefits terminated due to work each year.18
A 2020 SSA study examined a cohort of working-age individuals awarded SSA disability benefits in 2001
and tracked their outcomes through 2015.19 The study found that 5.4% of those awarded SSDI in 2001
and about 10.1% of those awarded SSI in 2001 had their benefits suspended due to work at some point
from 2001 through 2015. It also found that 3.5% of those awarded SSDI in 2001 and about 0.5% of those
awarded SSI in 2001 had their benefits terminated due to work at some point from 2001 through 2015.
Brief History of Efforts to Promote Work Among SSA
Disability Beneficiaries
Lawmakers have emphasized vocational rehabilitation (VR) and work as goals of SSA’s disability programs
since their creation. When lawmakers established SSDI in 1956, they (1) provided SSA with the authority to
refer disability applicants to state VR agencies for appropriate VR services, (2) required SSA to suspend the
benefits of disability beneficiaries who refused to accept VR services without good cause, and (3) allowed
those participating in a state VR program to work above SGA for up to 12 months without having their
benefits suspended or terminated.20 The House report accompanying the 1956 legislation stated,
We believe that everything possible should be done to support and strengthen vocational
rehabilitation. Rehabilitation, where it is possible, is the most economical method of providing for
disabled persons and is the most satisfactory for the individual…. In order to avoid setting up
barriers to vocational rehabilitation the bill specifically provides that a person who performs work
while under a State rehabilitation program will not, solely by reason of this work, lose his benefits
during the first 12 months while he is testing out a new earning capacity.21
In 1960, lawmakers replaced the earlier work incentive with the nine-month TWP and the three-month
grace period.22 They also made these new work incentives available to all SSDI beneficiaries who pursue
work, regardless of whether they participate in a state VR program. Further, lawmakers specified that the
level of work activity needed to trigger a TWP month should be lower than the level of work activity
that represents SGA.23
In 1965, Congress authorized SSA to make payments from the Social Security trust funds to reimburse
state VR agencies for the costs of providing services to certain disability beneficiaries, with total VR
service payments limited to a specified share of the prior year’s total disability benefits.24
17 SSA, Annual Statistical Report on the Social Security Disability Insurance Program, 2022, October 2023, Table 56,
https://www.ssa.gov/policy/docs/statcomps/di_asr/.
18 Paul O’Leary, Gina A. Livermore, and David C. Stapleton, “Employment of Individuals in the Social Security Disability
Programs,” Social Security Bulletin, vol. 71, no. 3 (August 2011), https://www.ssa.gov/policy/docs/ssb/v71n3/v71n3p1.html.
19 SSA, DI & SSI Program Participants: Characteristics & Employment, 2015, “Work Activity Before and After Award: Long-
Term Employment Activity,” March 2020, https://www.ssa.gov/policy/docs/chartbooks/di-ssi-employment/2015/index.html.
20 Social Security Amendments of 1956 (P.L. 84-880).
21 U.S. Congress, House Committee on Ways and Means, Social Security Amendments of 1955, report to accompany H.R. 7225,
84th Cong., 1st sess., June 14, 1955, H.Rept. 84-1189, p. 5.
22 Social Security Amendments of 1960 (P.L. 86-778).
23 U.S. Congress, House Committee on Ways and Means, Social Security Amendments of 1960, report to accompany H.R. 12580,
86th Cong., 2nd sess., June 13, 1960, H.Rept. 86-1799, p. 13. In 2024, the TWP earnings level is $1,110 per month, while the SGA
earnings level for most individuals is $1,550 per month.
24 Social Security Amendments of 1965 (P.L. 89-97). Initially, VR service payments were limited to 1% of the prior year’s total
SSDI disability benefits. This amount was increased to 1.5% in the 1970s. The limitation on VR service payments did not apply
to SSI, which is financed by annual appropriations.
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In 1972, lawmakers replaced the former federal-state cash assistance programs for older adults and people
with disabilities with the new federal SSI program, effective in 1974.25 In creating SSI, lawmakers
provided SSI applicants and recipients with certain basic income exclusions, which were similar to those
permitted under the former adult assistance programs. They also extended a number of SSDI provisions to
the new SSI program, such as the definition of disability for adults, the TWP, and the three-month grace
period. In addition, lawmakers extended the same basic VR referral, suspension, and payment provisions
to SSI applicants and recipients.
In 1980, Congress established a number of provisions designed to promote work among SSDI and SSI
disability beneficiaries.26 For example, Congress established a reentitlement period (EPE), provided
extended Medicare coverage, permitted beneficiaries to deduct certain IRWE from their earnings, and
established temporary provisions to permit SSI recipients to have higher levels of earnings and retain their
cash and medical benefits (i.e., the 1619[a] and 1619[b] provisions).27 Congress also required SSA to
conduct periodic medical reviews (CDRs) of certain disability beneficiaries, as well as authorized SSA to
conduct both SSDI and SSI demonstration projects to test the effectiveness of various changes to program
rules designed to encourage work among disability beneficiaries. The following year, Congress replaced the
earlier VR payment provisions with a new VR cost reimbursement program, which linked reimbursement
for VR services to the disability beneficiary earning above the SGA level within a certain period.28
In 1986, lawmakers amended the SSI program to make the 1619(a) and 1619(b) provisions permanent and
to eliminate those work incentives that were initially borrowed from the SSDI program (i.e., the TWP,
EPE, and three-month grace period).29 In explaining the rationale for permitting SSI recipients to have
higher levels of earnings under the 1619 provisions while enrolled in a program designed for those with
long-term, work-limiting impairments, a Senate report accompanying a related bill noted,
The Committee recognizes that section 1619, in providing benefits or Medicaid eligibility to some
people who could no longer qualify as regular SSI applicants (because they have proven their ability
to engage in substantial employment), will create some anomalous situations. The Committee
believes however that the acceptance of some anomalies is a reasonable price to pay for a program
which, without an expansion of the basic SSI program, removes substantial disincentives to work
attempts by the most highly motivated disability recipients.30
During the 1990s, a number of proposals were introduced to reform the provision of employment
supports and services to SSDI and SSI disability beneficiaries, as well as to extend health care coverage to
disability beneficiaries who return to work.31 Interest in these proposals culminated with the enactment of
the Ticket to Work and Work Incentives Improvement Act of 1999 (P.L. 106-170). Among other things,
the legislation established the TTW program, which allowed working-age disability beneficiaries to elect
to receive employment supports and services from approved private, nonprofit, and other service
providers, in addition to state VR agencies. In creating TTW, lawmakers eliminated SSA’s authority to
refer disability applicants to state VR agencies and to suspend benefits if disability beneficiaries refused
25 Social Security Amendments of 1972 (P.L. 92-603).
26 Social Security Disability Amendments of 1980 (P.L. 96-265).
27 For more information, see “Social Security Disability Amendments of 1980: Legislative History and Summary of Provisions,”
Social Security Bulletin, vol. 44, no. 4 (April 1981), https://www.ssa.gov/policy/docs/ssb/v44n4/v44n4p14.pdf.
28 Omnibus Budget Reconciliation Act of 1981 (P.L. 97-35). See also SSA, “Social Security’s Vocational Rehabilitation
Reimbursement Program,” https://www.ssa.gov/work/vocational_rehab.html.
29 Employment Opportunities for Disabled Americans Act (P.L. 99-643).
30 U.S. Congress, Senate Committee on Finance, Amendments to Section 1619 of the Social Security Act, report to accompany S.
2209, 99th Cong., 2nd sess., September 22, 1986, S.Rept. 99-466, pp. 3-4, https://www.finance.senate.gov/imo/media/doc/srpt99-
466.pdf.
31 See, for example, the following bills: H.R. 4230 and S. 1979 (104th Congress); H.R. 534 and H.R. 3433 (105th Congress); and
H.R. 1091, H.R. 3070, S. 86, and S. 331 (106th Congress).
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to accept VR services without good cause. The legislation also established EXR, lengthened the
reentitlement period (EPE) and the period of extended Medicare coverage, and created new state options
under Medicaid to permit certain workers with disabilities to “buy into” Medicaid.32
In addition, the 1999 legislation mandated that SSA conduct an SSDI demonstration project to test the
effects of reducing SSDI benefits by $1 for each $2 of the beneficiary’s earnings above a certain level,
similar to how the earned income exclusion works under SSI (i.e., a $1-for-$2 benefit offset). In the
2010s, SSA conducted the Benefit Offset National Demonstration (BOND) to test the effects of a benefit
offset and enhanced benefits counseling on employment, earnings, disability benefit use, and certain other
outcomes.33 Under the BOND, after exhausting the TWP and grace period work incentives, the level of
earnings over which SSDI benefits started to be reduced was the SGA level.
As part of the Bipartisan Budget Act of 2015 (P.L. 114-74), lawmakers mandated that SSA conduct
another SSDI demonstration project to test the effects of reducing SSDI benefits by $1 for each $2 of the
beneficiary’s earnings above a certain level, called the Promoting Opportunity Demonstration (POD).
Under the POD, the level of earnings over which SSDI benefits started to be reduced was generally the
TWP level, which is lower than the SGA level tested in the BOND.34 In addition, the POD eliminated the
TWP and the three-month grace period.
Selected Issues
Potential Barriers to Work
In 2018, SSA published a study that included estimates from a 2015 survey of working-age SSDI and SSI
disability beneficiaries.35 Of those beneficiaries who were not working, the most frequently cited reason for
not working was that their physical or mental condition prevents them from working (90%).36 Other reasons
cited for not working included being discouraged by previous work attempts (26%), inaccessible workplaces
(26%), and the inability to find jobs for which they are qualified (23%). (Multiple responses were possible.)
The reasons cited by disability beneficiaries for not working are often referred to as barriers to work.37
Overpayments may be another barrier to work for SSA disability beneficiaries. A work-related
overpayment may occur if (1) disability beneficiaries fail to report their work or earnings to SSA in a
timely manner or at all, (2) SSA fails to act on work or earnings reports in an appropriate or timely
manner, or (3) both. In 2023, the Government Accountability Office (GAO) noted that overpayments may
cause financial hardship for those who are liable for the overpayments and that work-related
overpayments may discourage further work attempts among disability beneficiaries.38 For example, a
2024 study found that 3.1% of those awarded SSDI benefits in 2008 were overpaid at some point within
32 SSA, “President Clinton Signs The Ticket To Work And Work Incentives Improvement Act Of 1999,” December 17, 1999,
https://www.ssa.gov/legislation/legis_bulletin_121799.html. For more information on Medicaid buy-in pathways, see CRS
Report R46111, Medicaid Eligibility: Older Adults and Individuals with Disabilities.
33 SSA, “Benefit Offset National Demonstration,” https://www.ssa.gov/disabilityresearch/offsetnational.htm.
34 SSA, “Promoting Opportunity Demonstration,” https://www.ssa.gov/disabilityresearch/pod.htm.
35 SSA, National Beneficiary Survey: Disability Statistics, 2015, March 2018, https://www.ssa.gov/policy/docs/statcomps/nbs/
2015/index.html.
36 Ibid., Table 15.
37 For a discussion of barriers to work and work incentive use among SSA disability beneficiaries, see U.S. Government
Accountability Office (GAO), Social Security Disability: Ticket to Work Helped Some Participants, but Overpayments Increased
Program Costs, October 28, 2021, pp. 17-23, https://www.gao.gov/products/gao-22-104031.
38 GAO, Disability Insurance: SSA Faces Ongoing Challenges with Overpayments, October 18, 2023, pp. 8-9,
https://www.gao.gov/products/gao-24-107113.
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the 10-year period after their award.39 Among those who were overpaid, the average total overpayment
was $13,556. In addition, a 2021 study found that among SSA disability beneficiaries who were recently
employed and overpaid, about 24% of SSDI beneficiaries and about 13% of SSI recipients changed their
employment in response to the overpayment.40
Recently, SSA has undertaken a number of initiatives designed to address issues related to overpayments.
For example, in February 2024, SSA issued a proposed rule to implement a payroll information exchange
with Equifax via The Work Number, which covers about two-thirds of non-farm payroll.41 Under the
proposed rule, SSDI and SSI disability beneficiaries may authorize SSA to obtain wage and employment
information directly from participating employers each month, which would reduce some of the reporting
responsibilities on the part of beneficiaries. SSA expects that receiving monthly data directly from
employers through the exchange will allow it to identify overpayments more quickly, which will reduce
the quantity and size of overpayments. In addition, SSA recently revised its guidance on recovering and
waiving overpayments to reduce some of the potential burdens faced by overpaid beneficiaries.42
The complexity of the work incentives available under the SSDI and SSI programs may be another barrier
to work. A 2019 technical expert panel convened by SSA concluded that the complexity of SSA’s work
incentives poses challenges “both for beneficiaries’ work efforts and for SSA’s ability to administer the
program.”43 In addition, in 2021, GAO noted that several of the experts it interviewed stated that SSA’s
work incentives “are so numerous and complex that even within SSA only a small number of specialists
understand them.”44
To address issues related to work incentive complexity, Congress established the Work Incentives
Planning and Assistance (WIPA) program in 1999. Under WIPA, SSA funds community-based
organizations that provide SSDI and SSI disability beneficiaries with free, in-depth benefits counseling on
how work and earnings may affect their cash and medical benefits.45 Each organization or WIPA project is
staffed by trained Community Work Incentive Coordinators. SSA funds 74 WIPA projects across the
country, which serve about 30,000 disability beneficiaries each year.46 Administrations have also put forth
proposals to simplify SSA’s work incentives. For instance, the President’s budget for FY2021 proposed to
“replace existing return-to-work programs and earnings rules with a simple system of offsetting DI
benefits based on a 4-tier earnings structure that is simpler and more efficient to administer.”47 This
proposal was not enacted into law.
39 Denise Hoffman et al., “Work Overpayments Among New Social Security Disability Insurance Beneficiaries,” Social Security
Bulletin, vol. 84, no. 1 (February 2024), Table 1, https://www.ssa.gov/policy/docs/ssb/v84n1/v84n1p49.html.
40 Marisa Shenk and Gina Livermore, Work-Related Overpayment and Benefit Suspension Experiences of Federal Disability
Beneficiaries, Center for Retirement Research at Boston College, November 1, 2021, Table 5, https://crr.bc.edu/work-related-
overpayment-and-benefit-suspension-experiences-of-federal-disability-beneficiaries/.
41 SSA, “Use of Electronic Payroll Data To Improve Program Administration,” 89 Federal Register 11773, February 15, 2024,
https://www.federalregister.gov/documents/2024/02/15/2024-02961/use-of-electronic-payroll-data-to-improve-program-
administration.
42 For more information, see CRS In Focus IF12632, Social Security Overpayments: Debt Recovery.
43 Daniel Gubits et al., Post-Entitlement Earnings Simplification Demonstration Technical Experts Panel Meeting: Final Report,
Abt Associates, July 22, 2019, p. 9, https://www.ssa.gov/disabilityresearch/teps.htm?ab=2.
44 GAO, Social Security Disability: Ticket to Work Helped Some Participants, but Overpayments Increased Program Costs, p.
22.
45 SSA, “Work Incentives Planning and Assistance,” https://www.ssa.gov/work/WIPA.html.
46 Robert Pfaff, “Overview of Social Security Administration’s (SSA) Return to Work Programs,” in Exploring the Ticket to
Work Program to Elevate Employment for Job Seekers with Disabilities, February 14, 2023, slide 11.
47 SSA, Justification of Estimates for Appropriations Committees, Fiscal Year 2021, February 10, 2020, p. 23,
https://www.ssa.gov/budget/.
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Ongoing Update to Jobs Data Used in Certain Disability Determinations
SSA uses a five-step sequential evaluation process to determine whether individuals meet the definition of
disability under the Social Security Act. Sometimes, medical evidence is sufficient for SSA to determine
whether individuals’ impairments are severe enough to meet the disability criteria. If SSA cannot
determine that individuals meet the definition of disability based solely on medical evidence, then the
agency must determine whether such individuals, despite their impairments, can do the work they have
done in the past or adjust to other work available in the national economy.
As part of the Occupational Information System (OIS) project, SSA has been updating the jobs data that it
relies on for disability determinations involving vocational assessments. After determining that
someone—despite their impairment—cannot perform their past work, SSA must also assess whether the
individual can adjust to any other work available in significant numbers in the national economy given
their age, education, and work experience. SSA currently relies on jobs data in the Dictionary of
Occupational Titles (DOT)—developed by the Department of Labor in 1938 and last updated in 1991—
when making such determinations.48 Since FY2012, SSA has been partnering with the Bureau of Labor
Statistics to develop an updated source of data—the Occupational Requirements Survey (ORS)—on jobs
and their requirements for use in its disability determinations. ORS will be the main source of the OIS’s
updated jobs information, in addition to certain data from other sources. Between FY2012 and FY2023,
SSA obligated a total of $272.8 million to the OIS project.49 To date, SSA has not implemented the OIS.
According to SSA’s OIS Project Frequently Asked Questions webpage, the agency will start using OIS
data in its disability determinations after it has “finalized [its] policy changes” and has “made conforming
changes to [its] computer systems.”50
Conclusion
Lawmakers established the SSDI and SSI disability programs to support eligible adults who cannot
perform substantial work due to their severe, long-term impairments. At the same time, lawmakers and
program officials have established work incentives and return-to-work initiatives to promote vocational
rehabilitation and encourage work among SSDI and SSI disability beneficiaries. Striking the appropriate
balance between these competing objectives is something both lawmakers and program officials have
wrestled with over the years. For example, a 1986 report from the Senate Committee on Finance noted,
While the Congress has found it necessary and important to limit eligibility under these programs to
those who are so medically disabled that they cannot work, the Committee recognizes that some
individuals determined to meet the Social Security Act definition of disability are nevertheless so
motivated towards work and independence that they later manage to work in spite of their impairments.
Such individuals present a difficult dilemma for public policy. Allowing them to continue receiving
income maintenance benefits would seem to undermine the fundamental Congressional decision
that eligibility be limited to those who cannot work…. On the other hand, terminating benefits in
such circumstances can be a powerful disincentive to the work efforts which these severely disabled
individuals are otherwise motivated to attempt.51
48 SSA also uses the expertise of trained vocational specialists (at the initial level) and vocational experts (at the appeals level) in
cases requiring vocational evaluations of individuals’ ability to do past and other work given their impairments.
49 SSA, Justification of Estimates for Appropriations Committees, Fiscal Year 2025, March 11, 2024, Table 2.24, p. 79,
https://www.ssa.gov/budget/.
50 SSA, “Occupational Information System Project FAQ’s,” https://www.ssa.gov/disabilityresearch/ois_project_faqs.html.
51 U.S. Congress, Senate Committee on Finance, Amendments to Section 1619 of the Social Security Act, report to accompany S.
2209, 99th Cong., 2nd sess., September 22, 1986, S.Rept. 99-466, p. 2.
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From the early 1980s through the late 1990s, lawmakers responded to the relatively low levels of work
activity among disability beneficiaries by establishing new work incentives (or modifying existing ones)
targeted at work-oriented individuals in specific situations (e.g., when their benefits are suspended or
reduced to zero). This approach increased the variety of work incentives and other supports available to
SSDI and SSI disability beneficiaries while also adding complexity to both programs.
Over the last 25 years, SSA has conducted a number of demonstration projects to inform lawmakers about
the effectiveness of different program rule changes designed to promote work and improve outcomes for
SSDI and SSI disability beneficiaries. SSA commissioned a summary report of “lessons learned” from its
past demonstration projects, which was issued in 2021. Acknowledging that individual demonstrations
varied widely in terms of their impacts, the report makes the “general conclusion” that while, on average,
the program rule changes that were tested meaningfully increased employment, they did not substantially
increase net earnings or reduce disability benefits.52 The report also states that there are “non-monetary
benefits to work that have personal and social value.”53 In a 2023 study of the TTW program, two SSA
researchers noted that “significant changes in beneficiary work activity would seem to require structural
changes to the disability program rules that would change beneficiary incentives for work.”54
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
CRS Reports, as a work of the United States Government, are not subject to copyright protection in the United
States. Any CRS Report may be reproduced and distributed in its entirety without permission from CRS. However,
as a CRS Report may include copyrighted images or material from a third party, you may need to obtain the
permission of the copyright holder if you wish to copy or otherwise use copyrighted material.
52 Austin Nichols, Jeffrey Hemmeter, and Debra Goetz Engler, ed., Lessons from SSA Demonstrations for Disability Policy and
Future Research, p. 22.
53 Ibid.
54 Paul O’Leary and Emily Roessel, “Effects of the Ticket to Work Program: Return on Investment and Overall Assessment of
Outcomes Versus Design,” Social Security Bulletin, vol. 83, no. 1 (February 2023), p. 29, https://www.ssa.gov/policy/docs/ssb/
v83n1/v83n1p1.html.
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