Skip to content

AARP Breaks Down the Latest News Regarding the Graham-Cassidy Health Care Bill: Watch Here

 

Impact of Federal Policies on an Aging Workforce with Disabilities (2012)

Overview

The Social Security Disability Insurance (SSDI) paid nearly eight million people in income in December 2009. This report developed by the National Technical Assistance and Research Center (NTAR) determines the possibleeffect of federal policy on work incentives for older adults (specifically those in their late fifties and sixties). Local governments and community planners should pay careful attention to potential adjustments in policies that may boost or hinder local employment and job growth.

Key Points

The report examined data from the 2008 Heath and Retirement Studies, as well as recent academic research reports examining workforce and federal policy data. What the report reveals is that SSDI often works as a disincentive for employing older, disabled adults. The report asserts that reforms are needed in the policies and incentives outlined by SSDI.

Other report highlights include:

  1. After an extensive look at the qualifying conditions for SSDI, Supplemental Security Income (SSI), the existing special work incentives built into SSDI and SSI, the Ticket to Work program, and the PASS (Plans to Achieve Self-Support) program, the report goes on to examine their various benefits and limitations. Other federal policies that “impede work at older ages” are also summarized.
  2. Two recent “econometric studies” indicate that SSDI actually reduces the incentive to re-enter the workforce. Reasons include earnings thresholds in qualifying for SSDI, lack of early intervention, and lack of requirement for rehabilitation. The structure of SSDI makes it fiscally worse to live off of it than on it.
  3. The report offers recommendations to change SSDI so that it would turn from a source of supplemental income to a way to get older adults back to work (page 16). These include changing a policy requirement stating that recipients lose all coverage if they earn just one dollar over the policy threshold, incentivizing rehabilitation, and eliminating the five-month waiting period to receive SSDI benefits.

How to Use

This report can be used as an aid for local government leaders to consider which disability policies are in need of reform and how. The older population will increase by 40 percent while the younger population is projected to increase by only five percent between 2010 and 2025. As the population grows older the percentage of those with disabilities will increase. That does not mean, however, that older adults do not want to work. If federal policy provides disincentives for older adults to become a vital part of the workforce then local governments and city planners will be at a disadvantage.

View full report: Impact of Federal Policies on an Aging Workforce with Disabilities (2012) (PDF – 186 KB)


Each issue of the award-winning AARP Livable Communities e-Newsletter contains a mix of inspiring examples, community resources and information about livability efforts from places near and far. Subscribe today!