Social Security Disability Benefits: Characteristics of the Approved and Denied Populations

Abstract

Using new data from the 2014 Survey of Income and Program Participation, I estimate that about 24 million individuals between the ages of 18-66 have applied for Social Security disability benefits at some point in their lives. This population is about evenly divided among those who have ever received benefits from the program (beneficiaries) and those who have been denied. Those who have been denied benefits have only somewhat more favorable health circumstances than beneficiaries. Further, relative to the general working age population, I find that the denied group has a high rate of poor health, high levels of poverty, and limited earnings. I also examine subpopulations of the denied group, finding that those who have been denied Social Security but who have received Supplemental Security Income disability face less favorable circumstances and those who have been denied Social Security but who have received VA, Workers Compensation, or private disability benefits have more favorable circumstances. Currently, no federal program or policy specifically targets work, health, or poverty outcomes of the denied Social Security population. Possible initiatives to improve outcomes, however, would need to take into account the underlying health conditions and work capacity of the population documented in this study.

Keywords: Social Security, Disability, Denied, Health, Poverty, Employment

JEL Classification: I10, D13, J14, J20