Follow-up of Former Drug Addict and Alcoholic Beneficiaries

by
Research and Statistics Note No. 2001-02 (released October 2001)

The authors, Mikki D. Waid and Sherry L. Barber, are with the Division of Policy Evaluation and Division of Statistics and Analysis, respectively, within the Office of Research, Evaluation, and Statistics, Office of Policy, Social Security Administration.

The findings and conclusions presented in this paper are those of the authors and do not necessarily represent the views of the Social Security Administration.

Introduction

In 1996, Congress passed the Contract with America Advancement Act—Public Law (P.L.) 104-121—which terminated benefits for Supplemental Security Income (SSI) and Disability Insurance (DI) beneficiaries whose primary impairment was drug addiction, alcoholism, or both. Individuals whose drug addiction and/or alcoholism played a significant role in their disability are discussed in this note. As a result of the 1996 legislation, those individuals became ineligible for benefits, effective January 1, 1997—an effect reflected in the Social Security Administration's (SSA's) SSI and DI rolls.

The 1996 legislation was not the first law to restrict SSI eligibility for persons with drug or alcohol dependencies. The Social Security Act Amendments of 1972 (P.L. 92-603) were the first provisions to specifically address drug addicts and alcoholics (DA&As) in the DI or SSI programs. The 1972 amendments required that DA&A individuals receive payments only through a representative payee and participate in treatment (if appropriate and available).

Because of the rising number of persons with DA&A status receiving disability benefits, Congress included several provisions for them in the Social Security Independence and Program Improvements Act of 1994 (P.L. 103-296). Section 201 of P.L. 103-296 placed a 3-year time limit on both SSI and DI benefits to individuals whose primary impairment was drug addiction or alcoholism.

Then, on March 29, 1996, Congress enacted P.L. 104-121, the Contract with America Advancement Act of 1996, which contained new, more restrictive provisions affecting DA&A cases. Beginning on the day of enactment (under section 105), SSA ceased to award SSI payments and DI benefits to new applicants.

As of January 1, 1997, the law also terminated eligibility of DA&A beneficiaries receiving SSI and DI on March 29, 1996, unless they successfully appealed the termination. SSA granted DA&A beneficiaries 60 days to file an appeal after they received the termination notice, if the appeal could be based on the fact that:

DA&A beneficiaries who appealed their benefit terminations on or before July 29, 1996, and who received no medical determination before December 31, 1996, continued to receive benefits while they waited for the initial decision. SSA terminated benefits immediately if the medical determination found no disability.

If, however, the individual received only SSI payments or was eligible for both SSI and DI benefits and was covered under the Goldberg-Kelly provisions, he or she would continue to receive SSI payments through the reconsideration level.1 Thus, under the 1996 legislation, DA&A beneficiaries continued to receive cash benefits (continued paid status) during the reconsideration level (appeal phase), whereas eligibility was terminated until the end of a successful medical determination (appeal). If the appeal was not successful, both paid status and eligibility status were terminated. Public Law 104-121 continues to allow individuals addicted to drugs or alcohol to continue to qualify for benefits based on another disabling condition(s) (such as acquired immune deficiency syndrome (AIDS), heart disease, schizophrenia, and so forth).

At the time SSA sent notification of eligibility termination to the former DA&A beneficiaries, the majority were receiving SSI payments. Although some of the results in this note include individuals who were not receiving SSI payments, the primary focus here is the 1996 legislation and how it affected SSI beneficiaries.

Findings

Characteristics of DA&A Beneficiaries

Public Law 104-121 immediately ended the award of new DI and SSI benefits to individuals whose DA&A status was material to their disability, and it required SSA to terminate benefits to existing DA&A beneficiaries by January 1, 1997. From June through July 1996, SSA sent notices to over 209,000 DA&A beneficiaries, informing them of pending termination of their benefits and their right to appeal. The targeted DA&A beneficiaries accounted for approximately 2.6 percent of DI worker beneficiaries and SSI disabled adult beneficiaries at the time. Of the DA&A beneficiaries, 57 percent were SSI-eligible only, 22 percent were concurrently eligible for SSI and DI, and 21 percent were DI-eligible only.

Characteristics of the 1996 DA&A beneficiaries are detailed below.2

To illustrate how DA&A beneficiaries compare with other disabled beneficiaries, we compared SSI beneficiaries who were DA&A with all SSI beneficiaries who were blind/disabled (Table 1). The two populations differed substantially in certain categories. For example, the majority of the DA&A cohort were aged 30–59, whereas the ages of the blind/disabled cohort were more spread out. The DA&A cohort also had a larger proportion of both black and male beneficiaries. More of the blind/disabled cohort appeared to have earned some kind of countable income, which may account for the lower monthly benefits that the cohort received on average. Finally, a larger percentage of DA&A beneficiaries had been on the SSI rolls for 5 years or less.

Table 1. Comparison of the SSI DA&A and blind/disabled populations, by selected characteristics, June 1996
Characteristic SSI populations
DA&A Blind/
disabled
Number
Total 134,250 5,103,160
As a percentage of total
Age
1–29 8.2 31.6
30–59 87.6 46.5
60 or older 4.2 21.9
Race
Black 40.1 27.8
White 41.0 47.4
Other 9.1 10.7
Unreported 9.8 14.1
Sex
Male 67.1 46.1
Female 32.9 53.9
No countable income 69.5 51.0
On SSI rolls for 5 years or less 82.9 50.9
Average monthly payment (dollars) 420.93 364.33
SOURCE: SSI 10 Percent Sample File for June 1996 and DA&A Universe Sample File for June 1996.
NOTE: The results in this table may differ from those given elsewhere in this research and statistics note because the sample used here was taken from June 1996 (not March 1996).

Addictions and Impairments of the March 1996 DA&A Beneficiary Cohort

SSA records indicate that over half of the total DA&A population were addicted to alcohol only, 16 percent were addicted to drugs only, and 27 percent were addicted to both.

The impairment data analyzed for March 1996 are for SSI cases only and indicate the impairment on which the eligibility was based at that time.3 Almost 75 percent of the SSI cases were classified in a psychiatric category, including 64 percent in the substance abuse category.4 A small percentage of individuals were classified in the affective disorder category (4.4 percent) and in the mental retardation category (3.0 percent).5 Very few people were listed in the cirrhosis of the liver or liver disease category (0.3 percent)—impairments often associated with severe alcohol abuse.

Maximus Inc., a referral and monitoring agency (RMA), provided additional information on DA&A beneficiaries.6 A sample of 82,806 cases from 43 states suggests that:

Loss of SSI Eligibility and Payment Status

The criteria for SSI eligibility should be considered before describing the individuals who lost eligibility and paid status. To be eligible for an SSI payment in any given month (that is, have eligibility status), an individual must meet certain criteria. Some of the criteria require that the individual be aged, blind, or disabled and have income and resources below a certain level. A person becomes ineligible for payment for any month in which the criteria are not met.

Of the 165,690 DA&A SSI beneficiaries who received notices in 1996, 100,010 of them lost paid status between March 1996 and December 1998. Only 65,680 individuals (or 40 percent of those who received notices in 1996) continued to receive payments by December 1998.

The number of people who lost eligibility status is slightly larger than that of those who lost paid status. Between March 1996 and December 1998, 101,120 DA&A beneficiaries lost eligibility status. Therefore, out of the 165,690 DA&A beneficiaries who received a notice in 1996, only 39 percent (64,570) had retained eligibility by December 1998. The decrease in the number of beneficiaries (beginning in January 1997) who were eligible to receive payments and the number who actually received payments is shown in Chart 1.

Chart 1.
SSI DA&A beneficiaries receiving notices in March 1996 who continued eligibility and the receipt of payments through December 1998
Line chart with tabular version below.
Show as table
Table equivalent for Chart 1. SSI DA&A beneficiaries receiving notices in March 1996 who continued eligibility and the receipt of payments through December 1998
Month Eligible for payment Receiving payment
March 1996 135,510 142,440
April 1996 136,800 144,540
May 1996 137,190 144,150
June 1996 137,400 140,580
July 1996 136,890 142,040
August 1996 135,240 140,230
September 1996 133,280 137,340
October 1996 130,690 135,170
November 1996 128,940 133,360
December 1996 128,230 130,800
January 1997 41,920 66,990
February 1997 46,260 64,530
March 1997 50,330 61,600
April 1997 52,210 60,430
May 1997 53,460 59,700
June 1997 54,580 59,760
July 1997 55,730 59,130
August 1997 56,330 58,980
September 1997 56,810 59,370
October 1997 57,690 59,660
November 1997 58,160 60,300
December 1997 58,810 60,320
January 1998 59,300 60,820
February 1998 59,770 61,770
March 1998 60,490 62,180
April 1998 60,790 62,680
May 1998 61,480 63,250
June 1998 62,490 64,170
July 1998 63,100 64,160
August 1998 63,410 64,520
September 1998 63,810 65,100
October 1998 64,090 65,250
November 1998 64,470 65,750
December 1998 64,570 65,680
 
 

How the Type of Reported Disability Changed Over Time

Because drug addiction or alcoholism was no longer a valid reason to retain program eligibility, persons continuing on the rolls had to establish eligibility based on another type of disability. In March 1996, when individuals first began to receive notices, over 60 percent of DA&A SSI beneficiaries cited "substance abuse" as their primary impairment. The second most cited impairment was "other mental disorders" (approximately 11 percent). That category does not include individuals suffering from mental retardation but does include those suffering from personality disorders, anxiety and other neuroses, schizophrenia, paranoia, functional psychoses, and other psychoses.

The primary impairment for DA&A SSI beneficiaries who were still eligible in December 1998 changed slightly, however, from March 1996. Of the 36,510 DA&A beneficiaries with a December 1996 diagnosis of substance abuse, over half (52 percent) were classified in the "other mental disorders" category by December 1998 (Table 2). The second and third most cited categories were "mental retardation" (8.4 percent) and "musculoskeletal and connective tissue disorders" (7.7 percent), respectively. Only 4.3 percent of DA&A beneficiaries continued to be listed in the "substance abuse" category.

Table 2. DA&A beneficiaries paid in December 1998, by primary diagnosis in December 1996 and December 1998
Primary diagnosis in December 1996 Number of beneficiaries eligible in December 1996 Primary diagnosis in December 1998
Infectious & parasitic Neoplasm Endocrine & metabolic Mental disorders Substance abuse Diseases of the— Musculo-skeletal system & connective tissues Injuries & poisonings Other Missing
Retardation Other Nervous & sensory organs Circulatory system Respiratory system Digestive system
Total number 65,680 1,640 460 1,940 5,990 33,530 1,810 1,700 2,710 1,840 1,280 5,200 1,350 2,130 4,100
Infectious & parasitic 590 270 0 10 0 210 0 10 40 10 10 10 0 0 20
Neoplasm 40 10 0 10 0 0 0 0 0 10 0 0 10 0 0
Endocrine & metabolic 330 10 0 110 10 120 0 10 10 10 0 30 10 10 0
Mental disorders
Retardation 2,360 0 10 20 1,420 550 10 20 10 30 20 50 30 110 80
Other 8,510 80 30 130 250 6,590 10 120 210 140 60 300 80 200 310
Substance abuse 36,510 840 230 1,110 3,060 19,000 1,570 980 1,570 1,020 700 2,820 720 970 1,920
Diseases of the—
Nervous & sensory organs 240 0 0 0 10 40 0 110 0 0 20 30 0 10 20
Circulatory system 270 10 0 0 0 20 0 0 200 10 10 10 0 0 10
Respiratory system 260 0 0 10 10 20 0 10 0 150 0 30 10 20 0
Digestive system 310 0 0 40 0 40 0 0 0 0 170 10 0 30 20
Musculoskeletal system & connective tissues 770 0 20 50 20 90 0 10 10 50 10 360 10 30 110
Injuries & poisonings 230 0 0 0 20 20 0 0 0 0 0 50 140 0 0
Other 3,940 30 50 110 430 1,960 70 120 160 100 50 380 60 280 140
Missing 11,320 390 120 340 760 4,870 150 310 500 310 230 1,120 280 470 1,470
SOURCE: DA&A Universe Sample File created from SSI 10 Percent Sample Files.

Characteristics of DA&A Beneficiaries Who Continued to Receive Payments in December 1998

Almost 40 percent of the DA&A beneficiaries who were still eligible for payments in December 1998 had been on the rolls from 3 to 5 years (Table 3). Similarly, 34 percent had been on the rolls between 6 and 8 years. By comparison, in June 1996, 48 percent of DA&A beneficiaries had been on the rolls for 3 to 5 years, and only 12 percent had been on the rolls for 6 to 8 years.7

Table 3. All SSI blind/disabled beneficiaries and SSI DA&A beneficiaries who were still receiving payments in December 1998, by selected characteristics
Characteristic All blind/disabled beneficiaries DA&A beneficiaries continuing to receive payments
Number Percent Number Percent
Total 4,324,700 100.0 65,680 100.0
Years on the SSI rolls
2 or less 683,020 15.8 9,590 14.6
3–5 906,490 21.0 24,730 37.7
6–8 854,280 19.8 22,360 34.0
9–11 482,240 11.2 5,690 8.7
12–14 483,580 11.2 2,430 3.7
15 or more 915,090 21.2 880 1.3
Living arrangement
Own household 4,046,720 93.6 63,930 97.3
Another's household 154,230 3.6 850 1.3
Parent's household 10,530 0.2 80 0.1
Institution 106,230 2.5 520 0.8
Not reported 6,990 0.2 300 0.5
Other income
Earned 272,500 6.3 1,010 1.5
Unearned
Social Security 1,419,170 32.8 15,990 24.3
Other 411,460 9.5 3,200 4.9
No other 2,221,570 51.4 45,810 69.7
Sex
Male 1,784,810 41.3 42,050 64.0
Female 2,539,680 58.7 23,630 36.0
Unknown 210 a 0 0
SOURCE: December 1998, 10 Percent Sample File and DA&A Universe Sample File.
a. Less than 0.05 percent.

Other characteristics did not change a great deal between DA&A beneficiaries receiving benefits in June 1996 and those who were still receiving benefits in December 1998. For example, the vast majority of them lived in their own household (97.3 percent in December 1998 compared with 97.2 percent in June 1996). Also, the majority continued to receive no income other than SSI. Approximately 69.7 percent of beneficiaries received no other income in December 1998 compared with 69.5 percent in June 1996.

Finally, the gender composition changed slightly during the follow-up study period. In June 1996, 67.1 percent of DA&A beneficiaries receiving SSI payments were male and 32.9 percent were female. Of the beneficiaries who were still eligible in December 1998, 64 percent were male and 36 percent were female.

How DA&A Beneficiaries Were Affected, by State

In December 1996, the top five states with the largest number of DA&A beneficiaries receiving SSI payments were California (31,030), Illinois (16,100), Michigan (9,880), Ohio (6,550), and Tennessee (4,960) as shown in Table 4. In December 1998, the top four states did not change: California (14,690), Illinois (6,250), Michigan (5,290), and Ohio (2,820). However, Massachusetts (2,640) replaced Tennessee (1,570) as the state with the fifth highest number of DA&A beneficiaries receiving SSI payments.

Table 4. SSI DA&A beneficiaries still being paid in December 1996 and those no longer receiving payments in December 1998, by state
State Number Percentage decrease
Receiving
payments in
December 1996
No longer receiving payments in December 1998
Total 130,800 58,080 55.6
Alabama 1,610 820 49.1
Alaska 290 110 62.1
Arizona 1,480 640 56.8
Arkansas 540 290 46.3
California 31,030 14,690 52.7
Colorado 910 520 42.9
Connecticut 730 390 46.6
Delaware 80 50 37.5
District of Columbia 180 90 50.0
Florida 2,530 1,140 54.9
Georgia 1,910 970 49.2
Hawaii 390 180 53.8
Idaho 240 110 54.2
Illinois 16,100 6,250 61.2
Indiana 1,510 560 62.9
Iowa 550 330 40.0
Kansas 780 300 61.5
Kentucky 4,500 2,320 48.4
Louisiana 1,090 510 53.2
Maine 830 450 45.8
Maryland 1,490 940 36.9
Massachusetts 4,620 2,640 42.9
Michigan 9,880 5,290 46.5
Minnesota 2,850 1,310 54.0
Mississippi 940 360 61.7
Missouri 1,460 660 54.8
Montana 290 110 62.1
Nebraska 330 180 45.5
Nevada 670 340 49.3
New Hampshire 190 100 47.4
New Jersey 1,110 580 47.7
New Mexico 700 350 50.0
New York 7,020 440 93.7
North Carolina 1,740 980 43.7
North Dakota 140 60 57.1
Ohio 6,550 2,820 56.9
Oklahoma 640 360 43.8
Oregon 1,500 560 62.7
Pennsylvania 4,320 2,080 51.9
Rhode Island 350 250 28.6
South Carolina 770 290 62.3
South Dakota 220 80 63.6
Tennessee 4,960 1,570 68.3
Texas 1,590 520 67.3
Utah 230 70 69.6
Vermont 160 80 50.0
Virginia 1,330 800 39.8
Washington 3,000 1,530 49.0
West Virginia 1,850 970 47.6
Wisconsin 2,480 1,020 58.9
Wyoming 90 20 77.8
Other 50 0 100.0
SOURCE: DA&A Universe Sample File created from SSI 10 Percent Sample Files.

New York had the largest percentage decrease (93.7 percent) in paid DA&A beneficiaries from December 1996 through December 1998. All but 440 of the 7,020 beneficiaries in that state lost their payments. During the same period, Wyoming had the second largest decrease (77.8 percent) in paid DA&A beneficiaries (from 90 to 20 individuals), followed by Utah (69.6 percent), Tennessee (68.3 percent), and Texas (67.3 percent).

Characteristics of DA&A Beneficiaries Who Received Payments in March 1996 but Had Them Discontinued by December 1998

Beneficiaries who spent the most time on the SSI rolls (9 years or more) were not as likely as those who spent 5 years or less on the rolls to lose payment status after the DA&A legislation (Table 5). A negligible number (0.5 percent) of individuals who lost payment status were on the SSI rolls for 15 years or more, compared with approximately 43 percent who were on the rolls for 2 years or less and 41 percent between 3 and 5 years. Thus, over 80 percent of DA&A beneficiaries who were no longer receiving payments by December 1998 had been on the SSI rolls for 5 years or less.

Table 5. All blind/disabled SSI beneficiaries and former DA&A SSI beneficiaries paid in March 1996 but discontinued by December 1998, by selected characteristics
Characteristic All blind/disabled beneficiaries Former DA&A beneficiaries receiving payments in 3/96 but discontinued by 12/98
Number Percent Number Percent
Total 4,324,700 100.0 81,470 100.0
Years on the SSI rolls
2 or less 683,020 15.8 34,620 42.5
3–5 906,490 21.0 33,390 41.0
6–8 854,280 19.8 9,610 11.8
9–11 482,240 11.2 2,600 3.2
12–14 483,580 11.2 830 1.0
15 or more 915,090 21.2 420 0.5
Living arrangement
Own household 4,046,720 93.6 77,350 94.9
Another's household 154,230 3.6 2,710 3.3
Parent's household 10,530 0.2 230 0.3
Institution 106,230 2.5 250 0.3
Not reported 6,990 0.2 930 1.1
Other income
Earned 272,500 6.3 1,340 1.6
Unearned
Social Security 1,419,170 32.8 20,910 25.7
Other 411,460 9.5 6,590 8.1
No other 2,221,570 51.4 52,790 64.8
Sex
Male 1,784,810 41.3 57,870 71.0
Female 2,539,680 58.7 23,600 29.0
Unknown 210 a 0 0
SOURCE: December 1998, SSI 10 Percent Sample File and DA&A Universe Sample File.
a. Less than 0.05 percent.

The vast majority (94.9 percent) of DA&A beneficiaries who stopped receiving payments lived in their own household. That is not surprising, however, because individuals living in their own household made up a similar share (93.6 percent) of the SSI population that was blind/disabled. Similarly, individuals who had no other income made up the majority (51.4 percent) of SSI beneficiaries who were blind/disabled and 64.8 percent of the DA&A beneficiaries who were no longer receiving payments by December 1998. Approximately 26 percent of DA&A beneficiaries who lost payment status by December 1998 had Title II (Social Security) income, 8 percent had other unearned income, and only about 2 percent had earned income.

Finally, one of the most interesting facts is the difference in discontinued payments by sex. Of the DA&A beneficiaries who were no longer being paid by December 1998, over two-thirds (71 percent) were male. Females accounted for the majority (58.7 percent) of SSI beneficiaries who were blind/disabled but for only 29 percent of the DA&A beneficiaries whose payments were discontinued.

Data Sources

The major results of this note were derived from the following four data sources-one of which is an analytical source:

  1. DA&A Universe Sample File containing persons who were sent notices from SSA's Office of Disability.
  2. SSI 10 Percent Sample File from SSA's Office of Research, Evaluation, and Statistics.
  3. "Supplemental Security Income Recipients for Whom the Alcoholism and Drug Addiction Provisions Apply."8
  4. Analytical source—the Lewin Group and its subcontractor Westat Inc.—"Policy Evaluation of the Effect of Legislation Prohibiting the Payment of Disability Benefits to Individuals Whose Disability is Based on Drug Addiction and Alcoholism." Lewin submitted this report to the Social Security Administration on July 21, 1998.9

Notes

1. The Goldberg-Kelly provisions require that a beneficiary file a timely appeal and receive a payment in the month before termination—in this case, December 1996. The Goldberg-Kelly provisions also allow for the continuation of SSI payments if good cause is found for a late filing of an appeal.

2. The data were obtained from the DA&A Universe Sample File that was created by SSA's Office of Disability in May and June 1996.

3. Information was missing for almost 19 percent of SSI cases (mostly those at the appellate level). Data for DI beneficiaries were not available. The impairment on which eligibility is based at that time may differ from the impairment that was the basis for the original allowance.

4. The information in this paragraph should not be confused with the information found in Table 2. The information in this paragraph refers to impairments cited as of March 1996, whereas the data presented in Table 2 refer to impairments cited as of December 1998.

5. The "other mental disorders" category in Table 2 includes affective disorders, psychiatric disorders, personality disorders, anxiety and other neuroses, schizophrenia, paranoia, functional psychoses, and the other psychoses categories found in Exhibit App. 1.13 from the Lewin report (see Data Sources).

6. RMAs operated under contract to SSA and were responsible for conducting initial evaluations of DA&A beneficiaries and referring them to appropriate treatment services.

7. These and the following June 1996 statistics were obtained from Sherry L. Barber, "Supplemental Security Income Recipients for Whom the Alcoholism and Drug Addiction Provisions Apply," Social Security Administration, Office of Research, Evaluation, and Statistics (unpublished, June 1996), Table 3.

8. For more information, refer to note 7.

9. The data from this report were also used by Paul Davies, Howard Iams, and Kalman Rupp (2000) in "The Effect of Welfare Reform on SSA's Disability Program: Design of Policy Evaluation and Early Evidence," Social Security Bulletin 63(1): 3–11.