Time to reform the disability-industrial complex

In 1996, proving that the third time is sometimes the charm, President Clinton signed into law a welfare reform bill he had twice vetoed.  Ten years later, he looked back on its success in a New York Times article, noting that the welfare rolls had dropped from just over 12 million to 4.5 million and that sixty percent of mothers on welfare had found productive work. Clinton added that “thankfully, a majority of Democrats and Republicans voted for the bill because they thought we shouldn’t be satisfied with a system that led to intergenerational dependency.”

Today, that dependency is being revived through the Social Security Disability Program, or now known as SSDI, which has exploded in growth over the last decade.  It may surprise you as it did me, to learn that the federal government spends more money each year on cash payments for disabled former workers than it spends on food stamps and welfare programs combined.  How much?  $135 billion in 2012 and a projected rise to $213 billion in 2023.

Like many federal programs, it started small — in 1974 — as a safety net for people in the workforce who suffer crippling physical disabilities that prevent them from continuing to work.  Then, in 1984, came the Disability Benefits Reform Act that shifted the criteria for eligibility from a list of specific impairments to a more general consideration of a person’s mental condition and ability to work.  It allowed consideration of a combination of ailments and allowed people to qualify on the subjective judgments of federal bureaucrats even in the absence of a clear-cut medical diagnosis.  Then there has been the addition of children to the program.  Yes, a program called Supplemental Security Income includes both children and adults who are both poor and disabled — completely distorting the original purpose of a program to help disabled workers. It’s not surprising that was once a program for 2 million people which now pays benefits to 11 million.

A study by the Congressional Budget Office released on March 14 shows that the changes resulted in large percentage increases of younger workers qualifying for the program due to “back pain” and “mental disorders” which have expanded to include hard to define anxiety problems, attention deficit disorder along with alcohol and drug abuse. Add to this a cottage industry of lawyers who specialize in helping people game the system and states who have discovered they can save money if they move people from welfare — where the state pays some of the freight — to disability where the federal government picks up the tab.

Type in your online search engine “Social Security Disability Insurance” and up will pop a handful of websites that urge you to hire an attorney to “get the benefits you deserve.”  Daytime television is full of ads from lawyers who promise to “fight the government” over a denial of disability payments.  However, even that is misleading.  A lengthy investigative report by National Public Radio’s “Planet Money” revealed there is no adversarial proceeding in an appeal when disability is denied.  It’s a judge employed by the Social Security Administration listening to an attorney argue the appeal with no one to speak for the government (i.e. the taxpayer) who has to foot the bill.

In the same “Planet Money” report, they visit a consulting firm based in eastern Washington state that is actually a call center that spends the day calling people to see if they qualify for disability.  Then they help people fill out the applications over the phone and get it to the “right people” at the Social Security office.  Their clients are the states.  In Missouri, for example, their contract request was for $2,300 for every person they move from welfare to disability.

It is time for Congress to act to reform a program that not only is out of control (the Disability Trust Fund will be out of money by 2016) but has created a new cycle of dependency that we recognized was harmful under the old welfare system not just to the taxpayer but to the very people it claims to help.  The Congressional Budget Office has made some reform recommendations and a study by the Carleson Center for Public Policy has recommended an approach using block grants to the states.  However, the first step is to make this issue a priority along with other spending and tax issues the Congress is working on.

Whether its rampant fraud in the Medicare/Medicaid provider network or government-induced abuse in the food stamps program and SSDI, false tax refund applications or simply the ???community organizers?????? expertise in guiding prospects through the 1230+ available federal assistance programs, it has become obvious that the safety net dam has broken and taxpayers are losing billions of dollars every year. We do so through either lax enforcement of our eligibility criteria or intentional efforts to steal from the government trough through greedy lawyers, doctors, accountants, individuals and non-profit agencies.

Don???t get me wrong ??? I fully support basic assistance for our country???s most needy, but not for the ever-expansion of government through these programs, especially when we can???t afford it. And, in the words of former MA Governor Bill Weld, ???We want to make the safety net a trampoline as opposed to a hammock.???

This abuse goes to the very essence of our social fabric and left unchecked will not only cost the government and taxpayers a fortune but it will take the American people down a slippery slope that will weaken the very essence of who we are. In light of our nation???s dire economic and fiscal reality, this should be one of many programs under review for Congressional reform. Having succeeded in 1996 with a divided government in solving a seemingly intractable program, there is every reason to believe we might do it again.

Al Cardenas is Chairman of the American Conservative Union.