Does Adequacy of Disability Benefits Vary by Type of Disability?

• In Event: Disability, Policy, and Financial Hardship

Abstract

While SSDI and SSI are the key programs to support workers who become substantially incapacitated for continued work, research on their adequacy in supporting the living standard of beneficiaries remains limited. This paper assesses the availability and adequacy of SSDI and SSI benefits by various types of work-limiting disabilities that people have. Data for this analysis come from the Health and Retirement Study (HRS), which has extensive information about the health status of adults over the age of 50, including subjective and objective measures of general and work-related health status, functional limitations, cognitive health status, and doctor-diagnosed health conditions, alongside self-reported information on SSDI and SSI applications and receipt. We first examine whether and how disability benefits receipt varies by the type and severity of health conditions. Next, we analyze the adequacy of disability benefits using a range of metrics, including the official poverty rate, food insecurity, and, to a more limited extent, a series of questions in the leave-behind questionnaire that elicit information on difficulties paying bills, satisfaction with financial situation, and financial strain. Because of likely endogeneity between socioeconomic outcomes and disability receipt status, we fit a marginal structural model. The results highlight the extent of systemic differences in availability and adequacy of disability benefits by type of disability.

Author

• Stipica Mudrazija, University of Washington
  Presenting Author