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SSA report says that aging boomers, women behind jump in payments

The rise in costs for the Social Security disability program has continued to be controversial in recent months. One charge that critics have leveled against the program is that it is paying benefits to people who are faking or exaggerating their conditions, either to defraud the government or because they are unemployed.

While the program’s defenders can still point to the difficulty most SSD applicants face in getting approved, it is true that the number of approvals per year has gone up from about 250,000 in 1970 to nearly 900,000 in 2008. What accounts for this increase?

A new study released by two economists at the Social Security Administration, which runs the SSD program, has a possible explanation. Instead of a nationwide increase in con artists, shifts in demographics appear to be driving the increased costs.

One of the two largest changes is the aging of the baby boomer generation. That generation is now in its late 40s between its mid-60s, a time in life when disabilities become more common. Given the large number of baby boomers, it makes sense that the number of applications for disability assistance would have gone up in recent years.

Another difference from the early 1970s to today is that women are more likely to work outside the home. This essentially doubled the workforce pool, and doubled the number of people who could qualify for SSD benefits after developing a serious illness or disability.

Factors like this appear to be challenging the SSD program’s finances, which needs to be addressed. But the report contradicts charges that fraud and marginal disabilities are the main source of the increase in payments.

Source: Los Angeles Times, “Explaining the ‘mystery’ of where all the disabled are coming from,” Michael Hiltzik, Dec. 3, 2013

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