2018 Annual Report of the SSI Program

II. Highlights

The SSI program is a nationwide Federal assistance program administered by SSA that guarantees a minimum level of income for aged, blind, or disabled individuals. This section presents highlights of recent SSI program experience, a summary of important legislative 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.

A. Recent Program Experience

SSI program experience during the past year included the following:

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During calendar year 2017, 1.6 million individuals applied for SSI benefits based on blindness or disability, a decrease of 8 percent from 2016. Additionally, 142 thousand individuals applied for SSI benefits based on age, an increase of 3 percent as compared to the 139 thousand who applied in 2016. In 2017, 768 thousand applicants became new recipients of SSI benefits, an increase of less than 1 percent as compared to the 767 thousand who became new recipients in 2016.

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Each month on average during calendar year 2017, 8.1 million individuals received Federal SSI benefits. This group was composed of 1.1 million aged recipients and 7.0 million blind or disabled recipients, of which 66 thousand were blind. Of these 7.0 million blind or disabled recipients, 1.2 million were under age 18, and 1.0 million were aged 65 or older. During calendar year 2017, 9.0 million aged, blind, or disabled individuals received at least 1 month’s Federal SSI benefit.

•	Federal expenditures for payments under the SSI program in calendar year 2017 totaled $54.6 billion, which was roughly the same level as in 2016.

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Each month on average during calendar year 2017, 1.5 million individuals received federally administered State supplementation payments. This group was composed of 414 thousand aged recipients, 1.1 million disabled recipients, and 20 thousand blind recipients. During calendar year 2017, 1.7 million individuals received at least 1 month of State supplementation payment.

•	State expenditures for federally administered State supplements, excluding fees for Federal administration totaled $2.6 billion in calendar year 2017, roughly the same level as in 2016.

•	In fiscal year 2017, 96 percent of SSI recipients received their benefits electronically, slightly up from 95 percent in 2016.

•	The cost the Social Security Administration (SSA) incurred to administer the SSI program in fiscal year 2017 was $4.1 billion, which was roughly 7 percent of total federally administered SSI expenditures.1

•	In January 2018, 8.2 million individuals received federally administered monthly SSI benefits averaging $552. Of these, 8.1 million received monthly Federal SSI payments averaging $536, and 1.5 million received monthly State supplementation payments averaging $146.

B. SSI Legislation Since The 2017 Annual Report

Since we submitted the 2017 Annual Report of the Supplemental Security Income Program to the President and Congress, the following legislative changes have been made to the SSI program:

Public Law 115-97, enacted December 22, 2017

The Tax Cuts and Jobs Act of 2017 included a provision that affects a certain type of tax-advantaged account, called an Achieving a Better Life Experience (ABLE) account, which can be used to save for the disability-related expenses of a “designated beneficiary” who is blind or disabled by a condition that began before age 26. Up to $100,000 in account balance, and expenditures only for disability-related expenses, are generally excluded from the designated beneficiary's resources and income for SSI purposes. This law made several changes to ABLE accounts:

•	Funds from qualified tuition programs (known as 529 plans) may be rolled over to an ABLE account without penalty and without counting against the annual contribution limit.

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The designated beneficiary may contribute to his or her ABLE account in excess of the annual limit (currently $15,000) if he or she worked and did not contribute to certain types of retirement plans (e.g., defined contribution plan) in a given year. The additional contributions are subject to set limits.

•	The designated beneficiary is potentially eligible for a tax credit for contributions he or she makes to an ABLE account.

The rollover change was effective upon enactment. The additional contribution and tax credit changes are effective with tax year 2018 and sunset in January 2026.

Public Law 115-123, enacted February 9, 2018

The Bipartisan Budget Act of 2018 amended title XVI of the Social Security Act to change the time by which correctional facilities that have signed an Incentive Payment Memorandum of Understanding with SSA must report prison information in order to be able to receive the maximum prisoner incentive payment. Entities reporting within 15 days of the recipient's incarceration will receive an incentive payment of $400. Entities reporting after the 15th day but within the 90 days of the recipient's incarceration will receive an incentive payment of $200. For individuals receiving both SSI and Social Security payments, entities reporting after the 15th day but within 30 days of the recipient's incarceration will receive an incentive payment of $300. This change does not apply to incentive payments made for individuals who are Social Security beneficiaries and not SSI recipients. These provisions are effective for title XVI incentive payments made on or after six months after enactment.

Public Law 115-165, enacted April 13, 2018

The Strengthening Protections for Social Security Beneficiaries Act of 2018 will protect SSI recipients by:

•	Strengthening oversight of representative payees by increasing the number of performance reviews of payees, requiring additional types of reviews, and improving the effectiveness of reviews;

•	Reducing the burden on families by eliminating the requirement to file the annual accounting form for representative payees who are parents of and who live with the minor child recipients they serve, or who are spouses of the recipients they serve;

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Protecting the most vulnerable recipients through improved information-sharing by requiring SSA to identify whether a recipient is in foster care and reassess whether the payee is appropriate, and by directing SSA to study how better to coordinate with Adult Protective Services and with state guardianship courts;

•	Enhancing personal control by allowing recipients to make a designation of their preferred payee in advance, and improve payee selection by requiring SSA to assess the appropriateness of the order-of-preference list it uses to select payees;

•	Limiting overpayment liability for children in foster care; and

•	Helping to ensure that no recipient has a barred payee by codifying the policy that bans individuals with certain criminal convictions from serving as payees (including individuals currently serving as payees) and prohibiting individuals who have payees from serving as a payee for others.

C. Current Issues Facing The SSI Program

For more than 40 years, the SSI program has provided a safety net for aged, blind, and disabled Americans who have nowhere else to turn, and who must rely on SSI benefits to meet basic needs of food and shelter. The program plays a crucial role in the lives of over eight million Americans and is funded from general tax revenues. Accordingly, we take great care to administer the program as accurately and efficiently as possible and remain committed to effectively overseeing the program, protecting taxpayer dollars, and maintaining the public's trust.

Program Integrity

We strive to prevent improper payments—either paying too much (overpayments) or paying too little (underpayments)—and to find, correct, and recover improper payments as soon as possible when they occur.

Making correct payments is especially challenging because SSI is a means-tested program. Accordingly, the correct monthly SSI payment amount changes as a recipient’s income, resources, living arrangements, and other circumstances change. The first line of defense against improper payments is timely reporting of these changing circumstances. We require recipients to report changes that may affect their benefits right away. However, some circumstances, such as the recipients’ medical impairment, may make reporting changes in a timely manner difficult. For this reason, it is important we have strong program integrity tools to detect unreported changes that may affect SSI eligibility and payment. These tools help us ensure that only individuals who are eligible for benefits receive them, and that we pay eligible individuals correctly.

One of our most effective program integrity tools is the SSI non-medical redetermination process, under which we conduct scheduled reviews of all nonmedical factors of eligibility to determine whether the recipient is still eligible for SSI and if his or her payment amount is correct. These reviews are often time-consuming and resource-intensive, therefore it would be administratively challenging and burdensome to complete scheduled redeterminations on each SSI recipient every year; consequently, to maximize resources and limit the burden on the public, we use a statistical model to prioritize redeterminations.

This allows us to focus on recipients who are most likely to have a change that affects eligibility or the amount of benefits. These redeterminations save billions of program dollars with a comparatively small investment of administrative funds. Based on the program integrity funding available for FY 2018, we expect to complete about 2.9 million SSI non-medical redeterminations this fiscal year. The President's proposed FY 2019 Budget would provide funding sufficient to complete 2.8 million SSI redeterminations in FY 2019.² Our estimates indicate that those FY 2019 redeterminations would yield about $4 of net Federal SSI and Medicaid savings over the first 10 years on average per $1 budgeted to conduct those reviews.

Ongoing Efforts
We continue to rely heavily on emerging technology to support our efforts to review recipient eligibility. For example, we use the Access to Financial Institutions (AFI) process to identify excess resources in bank accounts of SSI applicants and recipients by electronically checking for known and potentially unreported accounts directly with the financial institution.

Another important tool we use to reduce improper payments is the SSI Telephone Wage Reporting System (SSITWR). SSITWR is an automated, toll-free telephone number that allows recipients and representative payees to report wages by calling in and using either voice recognition or touchtone software.

We also have a mobile application that allows individuals to make monthly wage reports through an Android or iPhone smartphone. By entering information through a series of easily followed prompts, recipients can quickly and efficiently report wages from wherever they are. We expect these tools will help reduce improper SSI payments by making it easier for recipients to comply with reporting requirements.

Our most recent wage reporting tool is myWageReport (myWR). It is an online wage reporting tool located behind the mySocialSecurity portal that allows SSI recipients and deemors, Social Security disability beneficiaries, and representative payees to report wages via desktop, laptop, or mobile device. Wage reporters are provided an automated receipt that can be viewed, printed, or saved on their device.

Future Improvements
We continually look for new ways to improve how we prevent, detect and correct improper payments. For example, we recently implemented a method to detect and verify when SSI recipients own real property (e.g., houses other than their primary residence) that they have not reported to us. We integrated this new functionality into our SSI claims-taking and non-medical redetermination systems to ensure technicians can immediately use the data to determine eligibility and payment amount. In FY 2017 undisclosed non-home real property was the third leading cause of improper payments in the SSI program.

Conclusion

More than 40 years after its implementation, the SSI program continues to provide support for millions of vulnerable individuals. Our goal remains consistent: to pay the right person the right benefit at the right time. We will use every tool at our disposal to ensure that SSI payments are accurate. Moving forward, we will continue to search for ways to simplify the SSI program and to pursue technological improvements, resulting in a program that is easier for the public to understand, more efficient to administer, and that continues to provide critical public assistance.

D. Key Results From The 25-Year Projections

The major findings in the 25-year projections prepared for this report are:

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Following small declines in the SSI recipient population in the late 1990s due to the combined impact of Public Law 104-121 (the Contract With America Advancement Act of 1996) and Public Law 104-193 (the Personal Responsibility and Work Opportunity Reconciliation Act of 1996), modest growth in the SSI rolls resumed in 2000. The economic recession that began in late 2007 led to faster growth in the SSI recipient population through 2013, but in recent years the SSI recipient population has slightly declined as the number of applicants for SSI payments has continued to decline. We project this decline to continue in 2018, and then to resume a modest level of growth which is estimated to continue throughout the remainder of the projection period at a rate somewhat slower than the rate of growth in the U.S. population. By 2042, we estimate that the Federal SSI recipient population will reach 8.9 million. As a percentage of the total U.S. population, we project the number of Federal SSI recipients to decrease very gradually from 2.43 in 2017 to 2.25 percent of the population by 2042.

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We estimate that Federal expenditures for SSI payments in calendar year 2018 will slightly increase by $0.3 billion to $54.9 billion, an increase of 0.5 percent from 2017 levels. In dollars adjusted by the Consumer Price Index to 2018 levels, we pro­ject that SSI program outlays will increase to $62.0 billion in 2042, a real increase of 0.4 percent per year.

•	Federal SSI expenditures were 0.28 percent of Gross Domestic Product (GDP) in 2017. We project that such expenditures will decrease to 0.27 percent of GDP in 2018, and continue to decline thereafter to 0.20 percent of GDP by 2042.

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1

Administrative costs do not include the costs of beneficiary services provided to recipients through State vocational rehabilitation (VR) agencies and employment networks for VR services and payments under the Ticket to Work program.

2

In our efforts to accurately pay benefits, we also conduct medical continuing disability reviews (CDR). CDRs are periodic reviews of a recipient's medical impairment to determine if he or she is still disabled according to the statute. Generally, the cases with the highest likelihood of medical improvement receive a full medical review, whereas, the remaining cases due for review receive a mailer requesting updates on their impairments, medical treatment, and work activities, subject to available administrative funding.