Social Security Disability Insurance (SSDI) and Unemployment Insurance (UI) are forms of social insurance that provide protection against the risk of economic loss due to specific adverse events. SSDI insures against the risk of lost earnings due to a severe disability by providing monthly cash benefits to statutorily disabled workers who are unable to engage in substantial gainful activity (SGA) and to their dependents. UI, on the other hand, protects against the risk of lost earnings due to unemployment by providing temporary cash assistance to involuntarily unemployed workers who meet the requirements of state law. Although the two programs serve largely separate populations, under certain circumstances, some individuals may be concurrently (simultaneously) eligible for SSDI and UI.
In July 2012, the Government Accountability Office (GAO) released a report that examined the issue of overlapping SSDI and UI benefits. GAO found that 117,000 individuals received concurrent cash benefit payments from the SSDI and UI programs in fiscal year (FY) 2010 of more than $850 million. These individuals represented less than 1% of the total beneficiaries in both programs, and the cash benefits they received in FY2010 totaled 0.2% of SSDI benefit outlays and 0.4% of UI benefit outlays.
During the 113th Congress, several bills have been introduced to eliminate or reduce the SSDI benefits of individuals who concurrently receive UI benefits. These proposals take one of three general approaches to offsetting or preventing concurrent receipt of benefits. The first approach treats receipt of UI benefits as engaging in SGA, which would delay receipt of SSDI cash benefits and Medicare for individuals awarded but not yet entitled to SSDI benefits and could lead to a suspension of SSDI cash benefits for individuals already entitled to SSDI. The second approach suspends SSDI cash benefits for any month in which an individual receives UI benefits. The third approach reduces SSDI cash benefits, dollar for dollar, for any month in which an SSDI beneficiary is in receipt of UI benefits.
Proponents of these bills argue that concurrent receipt of SSDI and UI benefits is “double dipping” or duplicative, inasmuch as each payment serves the same function of replacing lost earnings. They also maintain that receipt of one benefit is fundamentally contradictory with the eligibility requirements of the other, in that UI beneficiaries are required to be able and available for work (as determined under state law), while SSDI beneficiaries must be generally unable to work due to a severe physical or mental impairment.
Opponents, on the other hand, argue that concurrent receipt of UI and SSDI benefits is consistent and appropriate under law, because the SSDI program actively encourages beneficiaries to return to work through various work incentives. Many opponents also contend that preventing or offsetting concurrent receipt of SSDI and UI benefits discriminates against people with disabilities who have lost their job through no fault of their own.
This report explores the issue of concurrent eligibility for the SSDI and UI programs and examines many of the legislative proposals introduced in the 113th Congress to eliminate or reduce concurrent receipt of SSDI and UI.