2009 Annual Report of the SSI Program

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The SSI program is a nationwide Federal assistance program administered by SSA that guarantees a mini­mum level of income for needy aged, blind, or disabled individuals. This section presents highlights of recent SSI program experience, a summary of important changes to the program in the last year, a discus­sion of current issues facing the SSI program, and a summary of the key results from the 25-year projec­tions.
SSI program experience during the past year included the following:
During calendar year 2008, 2 million individuals applied for SSI benefits based on blindness or dis­ability, an increase of 5 percent over 2007. An additional 147 thousand applied for SSI benefits based on age, an increase of 2 percent from 2007. In 2008, 930 thousand applicants were awarded SSI ben­efits, an increase of 10 percent as compared to the 844 thousand awarded benefits in 2007.
Each month on average during calendar year 2008, 7.2 million individuals received Federal SSI bene­fits. This group was composed of 1.1 million aged recipients, 6 million disabled recipients, and 66 thousand blind recipients. Of the 6.1 million blind or disabled recipients, 0.8 million were aged 65 or older. During the year, 8.1 million aged, blind, or disabled individuals received at least 1 month’s Fed­eral SSI benefit.
Each month on average during calendar year 2008, 2.3 million individuals received Federally-admin­istered State supplementary payments. This group was composed of 0.6 million aged recipients, 1.7 million disabled recipients, and fewer than 50 thousand blind recipients. During calendar year 2008, 2.6 million individuals received at least 1 month’s Federally-administered State supplementary pay­ment.
State expenditures for Federally-administered supplements, excluding fees for Federal administration, totaled $4.4 billion in calendar year 2008, up from $4.3 billion in 2007.
The percentage of SSI recipients participating in direct deposit reached 60 percent in fiscal year 2008. SSI recipient participation in direct deposit has increased gradually in recent years after experiencing a period of sharp growth when it more than doubled from 24 percent in 1995 to 49 percent in 2000.
In January 2009, 7.5 million individuals received Federally-administered monthly SSI benefits aver­aging $504. Of these, 7.2 million received monthly Federal SSI payments averaging $474, and 2.3 million received monthly State supplementation payments averaging $156.
Since the 2008 SSI Annual Report was transmitted to the President and Congress on May 30, 2008, the following legislative changes were made to the SSI program:
Public Law 110-245, enacted June 17, 2008
Provides that most cash military compensation will be treated as earned income for SSI purposes, thus allowing the service member to benefit from the SSI program’s more favorable consideration of earned income.
Provides that privatized military housing allowances withdrawn directly from a service member’s pay by military payroll and paid to the landlord, will be considered in-kind income and the SSI benefit reduction attributable to the housing allowance will be capped at one-third of the Federal benefit rate. In other cases, housing allowances will be considered earned income.
Excludes State-provided pensions for aged, blind, or disabled veterans (or their spouses) from income and resource considerations for SSI purposes.
Excludes any cash or in-kind benefits provided under an AmeriCorps program from income consideration for SSI purposes.
Public Law 110-328, enacted September 30, 2008
Extends the 7-year eligibility period for certain refugees, asylees, and other humanitarian immigrants (including victims of human trafficking) to 9 years for the period October 1, 2008 through September 30, 2011.
The 2-year extension also applies to those noncitizens whose SSI had previously ceased due to the expira­tion of the 7-year period. For these individuals, SSI benefits will be paid prospectively, monthly over the duration of the noncitizen’s renewed eligibility.
Exempts time-limited noncitizens from the 7-year cap on SSI eligibility during the 3-year window of October 1, 2008, through September 30, 2011, if they have naturalization applications pending or are awaiting the swearing-in ceremony.
Public Law 111-5, enacted February 17, 2009
Provides a one-time economic recovery payment of $250 to individuals not residing in Medicaid-funded treatment facilities who were eligible for SSI benefits in November 2008, December 2008, or January 2009. This payment will not be counted as income or taken into account for resources for the month of receipt and the following 9 months.
Throughout the past year, SSA has continued to ensure that its programs provide support for millions of beneficiaries. In particular, the SSI program provides a safety net for the neediest of aged, blind, and dis­abled Americans—an especially valuable form of aid during this severe economic downturn, when an increasing number of Americans rely on the Federal Government for assistance. Concurrently, an increase in the number of program beneficiaries generates additional burdens for SSA that are inherent in the administration of the SSI program. Confronted with the uncertainty of annual appropriations needed to support our large workloads, SSA must constantly balance the mandate to provide the required cash assis­tance to eligible SSI recipients with the equally important stewardship obligation to ensure that the correct levels of SSI payments are made and that these payments only go to those who truly meet the legislatively established requirements of the program. Our ability to manage these competing challenges will ultimately be the measure of success in our administration of the SSI program. Additional details of some successes and challenges recognized since the 2008 report are provided in the following paragraphs.
Economic Recovery Payments
The American Recovery and Reinvestment Act of 2009 provided for a one-time payment of $250 to adult Social Security beneficiaries, and to SSI recipients, except those in Medicaid-funded treatment facilities. Congress worked with the Administration to provide this relief to millions of beneficiaries. In response, SSA has worked with several Federal agencies including the Department of the Treasury, the Department of Veterans Affairs, and the Railroad Retirement Board to ensure that beneficiaries receive these payments in a timely manner. As a result, these Economic Recovery payments to nearly 55 million Social Security and SSI beneficiaries were made in May, 3 to 6 weeks ahead of the statutory requirement.
Expected Significant Increases in Claims Receipts
As a result of the economic downturn, SSA also expects to see substantial increases in applications for both Social Security and SSI benefits. While the baby-boom retirement wave has been expected, increases beyond those anticipated could occur due to persons who have been recently unemployed choosing to leave the labor force and elect earlier-than-expected retirement. In addition, the sharp increase in unem­ployment is expected to generate a significant increase in disability claims. Because SSI is predominately a program paying benefits to persons with disabilities, such increases in disability claims would result in significant increases in SSI program outlays and administrative costs. In addition to the increase in SSA’s workloads, the demographics of an aging labor force also affect our ability to meet these workload chal­lenges. Many of SSA’s most experienced staff are baby boomers themselves. Recent projections indicate that we might lose more than 40 percent of our current employees by 2016. Through additional funding recently provided by the President and Congress, we have started to replenish our staff, although newly hired staff will not have an immediate impact on our workloads since hiring and training employees is a lengthy process.
Payment Accuracy
As mentioned in last year’s report, SSI payment accuracy is beginning to reflect the strain of years of underfunding of SSA’s administrative budget. Since then, payment accuracy (measured as percentage of SSI payments made that are free from overpayments) continues to decline, from 90.9 percent in FY 2007 to 89.7 percent in FY 2008. This number is measured by internal quality reviews and is our most compre­hensive measure of program performance. As in past years, the two areas with the highest error rate are earned income and resources (primarily bank accounts). This decline in payment accuracy is almost cer­tainly related to recent declines in the resources available to conduct nonmedical redeterminations.
Beginning in FY 2009, however, increased resources are being provided for such nonmedical redetermina­tions, and it is hoped that this change will help reverse the downward trend in payment accuracy. In addi­tion, we are committed to developing additional tools to assist in the process of ensuring payments are made properly. An example of such a tool is the Access to Financial Institutions (AFI) initiative. Under this program, SSA is able to electronically submit requests for verification of bank data, helping to deter­mine whether SSI applicants have undisclosed resources, a factor that could affect their eligibility for SSI benefits. The AFI initiative has been tested in three States and results to date have shown a positive return on investment, suggesting that expansion of the AFI initiative on a nationwide basis would improve our stewardship of the program. However, in order to continue AFI operations in these three States, as well as complete a nationwide expansion, we need sustained dedicated funding for training and systems develop­ment, in addition to funding of ongoing maintenance costs.
Performing More CDRs and Redeterminations
Robust program stewardship and program integrity are necessary for preserving the public’s trust in our programs. As indicated above, one of our important tools in assuring payment accuracy is the nonmedical redetermination which periodically reviews the factors that can change or eliminate the eligibility of an individual. In addition, the main tool in evaluating whether disabled individuals continue to satisfy the medical eligibility requirements of the SSI program is the continuing disability review (CDR). In recent years, due to reduced funding for such efforts, SSA has had to defer some of these program integrity efforts. However, with the funds appropriated to SSA by Congress in the Omnibus Appropriations Act, 2009 (Public Law 111–8), we expect to conduct 1.7 million SSI redeterminations, an increase of nearly 500,000 compared to FY 2008. Furthermore, estimates continue to indicate that SSA will achieve a sav­ings in Federal SSI payments of roughly $10 for every $1 spent conducting additional redeterminations above our base workload volume. The FY 2010 President’s Budget includes $759 million for our program integrity efforts, an increase of $255 million from FY 2009. This increased funding would allow us to complete a total of 794,000 CDRs1 and 2,322,000 SSI redeterminations during FY 2010.
Potential Program Improvements
Because the public expects secure, convenient, and easy-to-use electronic services, we have enhanced two online programs. Ready Retirement and Disability Direct allow Social Security claimants to simplify the process for filing for benefits, while also allowing claimants to file from any home or office with Internet access. In the long term, we would like to provide an Internet option for SSI applicants as well. However, because of the complexity of SSI, automation will be challenging. Were certain eligibility and benefit cal­culations to be simplified, automation of the application process might be more tractable. However, such simplification efforts must be balanced against the means-tested nature and aims of the SSI program. Achieving such a balance is an ongoing challenge, but we remain committed to finding ways to simplify SSI, and to providing a wide array of service options for our beneficiaries.
Although legislative and regulatory changes have attempted to simplify aspects of the SSI program, the means-testing requirements remain complicated. We expect to work with Congress in support of the Presi­dent’s proposal to revisit asset limits for Federal means-tested programs, many of which have remained unchanged for over 20 years. Nevertheless, even with needed simplification and reformed assets tests, we are in the early phases of the SSI automation initiative, and we anticipate that at its completion beneficia­ries will have more filing options, and our employees willin some caseshave a less labor intensive adjudication process.
We are also continuing efforts to strengthen our representative payee program. We have begun to pull sam­ple sets of representative payee cases and perform spot checks to ensure integrity and compliance. There is also an effort underway to match data with National Protection and Advocacy groups. This will allow us to flag potential “problem” cases and check them against our data to ensure that representative payees are properly financially managing the SSI payments of our beneficiaries who are incapable of managing their own payments.
Moving Forward
The SSI program is one of the most relied upon programs for some of the nation’s neediest individuals. Because of the program’s important role as a safety net, we must be mindful that we have a responsibility to wisely use our resources. Given the proper resources, we can strive to achieve the high level of SSI pay­ment accuracy that legislators and the public expect from us. However, even with sufficient resources, we realize that the SSI program still needs to be simplified. New legislative or regulatory proposals may be needed to address issues identified by our stewardship reviews. With the continued support of Congress and adequate funding, we will strive to overcome these challenges. We are committed to carry out our mission of advancing the economic security of the nation’s people through compassionate and vigilant leadership.
The major findings in the 25-year projections prepared for this report are summarized below:
Following small declines in the SSI recipient population in the late 1990s due to the combined impact of Public Law 104-121 and Public Law 104-193, modest growth in the SSI rolls resumed in 2000, and is expected to continue throughout the projection period largely due to the growth in the U.S. popula­tion, although the current economic recession is expected to temporarily generate additional growth beyond what might be expected from recent historical trends. By 2033, the Federal SSI recipient pop­ulation is estimated to reach 9.7 million. Expressed as a percentage of the total U.S. population, the number of Federal SSI recipients is projected to increase slightly from 2.31 percent of the population in 2008 to 2.56 percent by 2033 due largely to the changing age distribution of the population.
Federal expenditures for SSI payments in calendar year 2009 are estimated to increase by $2.8 billion to $44.9 billion, an increase of 6.7 percent from 2008 levels. In constant 2009 dollars, SSI program outlays are projected to increase to $57.0 billion in 2033, a real increase of 1.3 percent per year.
When compared to the GDP, Federal SSI expenditures are projected to temporarily increase from the 2008 level of 0.29 percent of GDP due to the effects of the economic recession, but thereafter gradu­ally decline over time to 0.25 percent of GDP by 2033.

This figure is the total number of CDRs expected to be processed in 2010, including cases involving OASDI and/or SSI. Over the past several years, CDRs involving SSI recipients have represented about 45 percent of the total number of CDRs processed.

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