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Rebecca Farley

Director, Policy & Advocacy, National Council for Behavioral Health

As the New Congress Begins, House Takes Aim at Social Security Disability

January 8, 2015 | Federal Budget | Comments
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A small provision buried in the House’s operating rules for the 114th Congress could have a major effect on Social Security Disability Insurance, potentially cutting recipients’ benefits up to 20 percent in 2016. Passed on a 224-172 vote, the change prohibits routine transfers between the Social Security retirement trust fund and the Social Security disability program. Without an infusion of funds, the disability program could face severe shortfalls starting next year.

According to the Center on Budget and Policy Priorities, transfers between the two funds are routine; they have been used 11 times in the past to ensure neither fund runs short of money. Under the new rules, a transfer from the Social Security retirement program to Social Security disability could only take place if it is determined to benefit the “overall financial health” of the program. Experts say this language means any transfer would likely have to be balanced by new revenues or benefit cuts – a move that could put pressure on the disability program and its beneficiaries.

The new language puts fiscal conservatives in a stronger bargaining position in pushing for entitlement reforms. Congress is widely expected to take up proposals this year to reform Medicaid and the disability insurance program, among others.