Planet Money, the NPR economics show, just released an article about the dramatic increase in the number of people receiving disability. I linked to the article above, but I wanted to specifically highlight some of the facts mentioned in the article:
“Every month, 14 million people now get a disability check from the government.” There are now roughly 16 people working for every one person getting a SSDI check.
“The federal government spends more money each year on cash payments for disabled former workers than it spends on food stamps and welfare combined.”
“People on federal disability do not work. Yet because they are not technically part of the labor force, they are not counted among the unemployed.” Obviously, this omission distorts the picture of the labor market.
“There’s no diagnosis called disability. You don’t go to the doctor and the doctor says, “We’ve run the tests and it looks like you have disability.” It’s squishy enough that you can end up with one person with high blood pressure who is labeled disabled and another who is not.”
Referencing a doctor in a town where 1/4 of the people are on disability: “Dr. Timberlake believes he needs this information in disability cases because people who have only a high school education aren’t going to be able to get a sit-down job. Dr. Timberlake is making a judgment call that if you have a particular back problem and a college degree, you’re not disabled. Without the degree, you are.”
“There used to be a lot of jobs that you could do with just a high school degree, and that paid enough to be considered middle class. I knew, of course, that those have been disappearing for decades. What surprised me was what has been happening to many of the people who lost those jobs: They’ve been going on disability.”
“Applications for disability rise and fall with the unemployment rate.” This again speaks to a large number of people going on disability who are not truly disabled.
“Disability has also become a de facto welfare program for people without a lot of education or job skills. But it wasn’t supposed to serve this purpose; it’s not a retraining program designed to get people back onto their feet. Once people go onto disability, they almost never go back to work. Fewer than 1 percent of those who were on the federal program for disabled workers at the beginning of 2011 have returned to the workforce since then, one economist told me.”
“People who leave the workforce and go on disability qualify for Medicare, the government health care program that also covers the elderly. They also get disability payments from the government of about $13,000 a year. This isn’t great. But if your alternative is a minimum wage job that will pay you at most $15,000 a year, and probably does not include health insurance, disability may be a better option.”
People gaming the system is a fairly big concern, but I think the bolded portions above highlight the underlying problem in this case, and are also behind the many of the negative consequences of the rising income and wealth inequality that has been discussed in GD a lot recently. We don’t effectively utilize the human capital of those without white collar job credentials, qualifications, or skills. Instead, many of these “unqualified” people are funneled into insecure, low-wage, physically demanding jobs, lured by the the quick money often found in informal sector (eg. drugs, crime), and/or they are guided towards a life of being reliant on government handouts and wealth transfers. Broadly speaking, we have a system that needlessly destroys human potential more than it nurtures it, and most seem to be indifferent to it.
Of course I recognize that you can’t force employers to hire unqualified people at above market wages, but I also think between the the millions of people getting some sort of handout, and the 2.4 million people in jail, we are doing a really poor job of utilizing talent and creating productive citizens. Ideology will obviously guide many solutions people have, and their diagnoses of the problem, but it seems we haven’t even really tried to grasp the magnitude of the problem. Hiding our failure by pretending these people don’t exist makes things much worse. Shouldn’t this be a bigger issue on both sides of the aisle?
I think number 8 is a lot of it. I could be wrong, but the impression that I got was that when they tightened up on welfare, disability pretty much took its place, and in a lot of states where there’s not a lot of welfare benefits, disability sort of serves as a replacement.
I know a fair number of people on disability for psych reasons and although it pains me say to this, when I hear skepticism expressed about this sort of disability, it doesn’t really surprise me. In fact, if I’m going to be completely honest, eventhough well over 90% of my personal acquaintances would love to go back to work and where possible have done so part time (there is a wonderful program called ‘ticket to work’), I have known a rare few who certainly have issues they need to work through but don’t belong on the dole.
Anyway, getting back to strictly physical disability, I don’t really understand how this one line doesn’t pretty much scuttle the entire article
"When you are an adult applying for disability you have to prove you cannot function in a “work-like setting.”
So of the examples I saw, diabetes, bypass, hypertension, how are any of those things preventing you from functioning in a work-like setting? I’ve worked with people with all of those problems.
I just skimmed through so at some point is the author alleging outright corruption or something? Because if so, how does that work. I know that for psych disabilities the patient not only needs their own doctors records to use the right incantations but there is an independent review process. I know because I was the representative payee for someone for years, so that doesn’t really seem very likely to me.
In a growing economy, most employers don’t care if some of their employees are a bit less efficient because of minor issues. The low unemployment rate means they don’t have much choice.
In a depressed economy with high unemployment, the employers will get rid of their least efficient workers, and these workers have problems getting new jobs. What were minor issues is now show-stoppers.
Why shouldn’t the definition of disability be that it hinders you from getting (and keeping) a job? What other definition should be used?
FYSA This American Life did a simular podcast this week on the same topic … I haven’t listened to the Planet Money podcast yet but on my way home tonight I will…
krunen: Hey, I’m all for gaming the system if that’s what it takes. The banksters and robber barons got used to be people taking it up the ass, turning around and saying, ‘thank you sir.’ But people are wising up and it’s about fucking time.
My only point was that having known people, a good number of people in the system, the story he’s telling just sound funky. I’m not going to call it bullshit since all of my experience is with people on psych disability, but I can’t imagine that medical disability can be as much of a free ride as he makes it out to be. A lot of the folks I know had to wait years before they got their first check - literally 18 months to 2 years. That was the exception, but I don’t think anyone ever got it in less than 6 months. That’s a long fucking time if you’re living paycheck to paycheck. So personally, I think NPR needs to get some better reporting.
Anyway, you raised a good point but I mention it for a completely different reason. Employers really have been getting more and more Scrooge-like over the past 20 years or so. I couldn’t believe when I changed jobs once and my so-called 8 hour no longer included lunch and was in fact a 9 hour day. But that’s what everybody was doing so you went along with it or you went elsewhere. And that’s just one example. I agree that work has probably become more stressful on average than it once was so that a lot of people who maybe at one time could have scraped by now have to throw in the towel - for real.
One thing to remember is that for someone who has never worked, or not worked much the SSDI amount they receive monthly is around $650. Have you ever lived on $650 in the USA? It ain’t much of a life, I can’t imagine people going through all the trouble of scamming for that prize.
I know a LOT of people who have been on it for psych reasons but the truth was they were basically unemployable, if it wasn’t for SSDI or family supporting them they would be homeless or prostitutes etc. I think part of the problem is the lack of jobs for those with only a high school diploma, and the lack of jobs that don’t require customer service or “people skills”. The workforce now is mostly in service industries, and for someone who can work but is just “off” enough that they can’t deal with the public it basically means they are locked out of the work force.
If someone is willing to live on $650 dollars a month that should tell you they are desperate and with no other prospects.
I know of one woman who physically is fine but has bad panic attacks and after a couple years and a lawyer got on disability for them.
Now I have no issue with this except, and I could be wrong, my understanding is that this is the worst thing for a person suffering panic attacks, to remain housebound. The treatment is to get out into the world and confront and learn to cope with the panic.
So it seems like in this case allowing disability is counter to the cure? I am sure, most of us have no issues with people who are genuinely disabled getting help. But now it’s hard to do.
**Grude: **Has anyone tried “Ticket to Work?” That’s a great program that let’s you work part time and still keep a pro-rated portion of your benefits. If you’re able to go back full time but for some reason you can’t keep up the pace, you can still go back on disability within a year or two I think. I don’t think you need to be re-evaluated, but you’d need to check on that.
There are approximately 2.5 million people receiving social security (old age or disability) who are working.
Besides the fact that some do work, including people not trying to work as unemployed would distort the picture of the labor market. Regardless of the reason for not looking, people not looking are not part of the labor market.
Official definition (as used by BLS in Labor Force Statistics, is
BLS exludes from its numbers anyone in an institution, but they still count more than double the number of people receiving SSI, so while of course there are always exceptions, it doesn’t seem likely that there’s a whole lot of “fake” disabled.
As far as economic viability, that’s not necessarily unfair. A back problem will not impair work for the jobs of most college graduates, but it will for most without a degree.
Not necessarily. The percent of the population classified by BLS as disabled as remained about the same over the last 5 years. So what’s more likely is that people who are disabled, but had jobs that could accomodate them, are now having a more difficult time finding such jobs and go on disability rather than Unemployment Insurance. That’s not the same thing as "not truly disabled)
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Note too that Federal law does allow a lower than minimum wage for disabled.
I would find the age distribution of people on disability to be interesting. You’ve got a lot of people in what would have been their last decade of working, who haven’t been able to find work in years and know they aren’t likely to be able to find work in time to make a difference.
You undoubtedly have some of that group that have more than the usual share of physical problems for their age, but who would have kept working if they could have. But since they can’t, they’ll see if they can qualify for disability.
If people like that are the primary reason the disability rolls are filling up, it’s not some moral failure on the part of the workers that’s causing this. It’s a moral failure on the part of those who run this country, but think it’s more important to cut the deficit than get people back to work.
krunen’s comment shows why this conclusion is nonsense. When unemployment is low, employers just have to suck it up and take what they can get, including employees with inconvenient but not incapacitating health issues. When unemployment is high, they can cut those people loose and find replacements. Thus, the exact same person with the exact same medical condition can be employable, or not, depending on the economic background.
There is another aspect to it: given our present system, with health care benefits depending on employers, why would an employer hire someone with diabetes, hypertension or a history of having had a heart bypass? It’s very likely to cost them extra money in lost productivity and increased health care benefits. You may have worked with such people, but once a person is unemployed and has those conditions, what are their chance of finding a job?
To get disability, one usually has to prove to a judge that he/she is truly unable to hold down a job. Almost everyone gets rejected on the initial application. You can’t just get a doctor’s note.
Remember, too, that to be employable, one generally has to show up for work on a reliable schedule. A person who may be fine one day but will not be able to work on other days, unpredictably, is not a good candidate for most employers.
I bet a lot of the skepticism about psychological disability is because a lot of it seems so… dramatic, for lack of a better term. We see the mentally handicapped people working as bag boys, checkers, stockers and greeters and other jobs at various companies, and wonder just how crazy you have to be to be judged disabled and unable to work because of your psychological condition. And based on what we see, to a lot of people, it seems like unless you’re running around naked with a bozo wig on your head, and a toilet plunger sticking out of your ass, you’re probably as capable of doing some kind of work as the mentally handicapped people.
In the OP it says $13,000 a year, which is $1083 a month, or more precisely, $500 biweekly. I’m guess there are deductions, but it still sounds like more than $650 a month.
ETA: I see your amount is for someone who has never worked, or not worked much. So, it’s prorated depending on what you’ve paid in?