The Employment/Eligibility Service System: A New Gateway for Employment Supports and Social Security Disability Benefits

The authors propose to modernize the gateway to the Social Security Disability Insurance (SSDI) program in a manner that addresses two systemic problems with the economic security system for workers who experience threats to work because of medical conditions: (1) limited access to timely work supports, resulting in unnecessary labor force exit and SSDI benefit receipt; and (2) long processing times, large numbers of allowances after appeals, and other performance issues for those who apply for SSDI. Both problems are fallout from the failure of the system to keep up with changes in technology, medicine, the nature of work, and the conceptual understanding of disability in the decades since SSDI’s inception in 1956. Re-structuring the gateway to SSDI could improve the economic security of workers and reduce SSDI caseload growth.

The new gateway would consist of a system of integrated employment/eligibility services (EESs). Key EES features include: outreach to workers, employers, and health care providers; triage of applicants into no support, work support, or immediate SSDI entry conditional on Social Security Administration (SSA) approval; and delivery of evidence-based work supports. The active pursuit of a work plan, with support, would constitute a supported test of the ability to work; lack of success could eventually result in an SSDI award.

Each state would establish an EES system, incorporating elements of existing state agencies (such as the disability determination service [DDS], vocational rehabilitation agency, American Job Centers, short-term disability insurance program, and workers’ compensation) supplemented by contractors as needed. Private disability insurers and workers’ compensation insurers could potentially qualify to act as EESs for their covered workers. SSA would lead a multi-agency office to oversee the new system. Workers would be able to appeal EES denials through a federal appeal process, similar to the way many SSDI applicants appeal DDS denials today.

Evidence from other countries and private insurers implies that the new SSDI gateway could greatly increase continuation of work and decrease SSDI entry. We estimate that eventual reductions in federal expenditures for SSDI beneficiaries, net of additional expenditures for employment supports, could be on the order of $25 billion per year, though accurate prediction of impacts is not possible. The proposed system is designed to reduce, not increase, the burden on employers of hiring and retaining workers at risk for SSDI entry.