Why are Disability Applications Down?

There was some unexpected news in the New York Times earlier this summer: disability applications are way, way down.

In 2017, 2.18 million applied for either Social Security Disability Insurance or Supplemental Security Income. That’s down from 2.94 million in 2010, and it’s the lowest number since 2002.

The total number of people receiving disability benefits also declined from a peak of 8.96 million in 2014 to roughly 8.63 million today.

The decline in disability recipients extends the solvency of the program to roughly 2032. The federal government previously estimated that the program could run out of money as soon as 2028.

The New York Times article says that there are several reasons for the decline in applicants in recipients.

First, the economy is doing quite well, especially for lower skilled workers. People who would have applied for disability a few years ago when they couldn’t find work are now able to obtain jobs.

This also means that some people who have been receiving benefits are able to find jobs and return to the workforce.

Second, the expansion of Medicaid in the last few years has made it easier to obtain medical coverage, so fewer people are applying for disability as a way to get health insurance (those receiving Social Security Disability Insurance still receive Medicare two years after being found disabled).

The final reason for the decline in applications, according to the article, is the difficulty in obtaining benefits.

It’s still taking nearly two years in many parts of the country to get a case heard by an administrative law judge.

Even then, approval rates at the hearing level have drastically declined in the last few years. In 2008, nearly 70% of appeals at the hearing level were awarded. Today, that number hovers around 45% nationally.