AARP Public Policy Institute Fact Sheet 19 Million Working-Age Americans Have a Disability that Limits or Prevents Work. Most are Poor or Low Income. People with disabilities are often at a distinct disadvantage in the labor market. Public and private insurance programs, and public assistance programs, may replace lost income and provide health insurance coverage for severely disabled workers, but programs need to be improved both to provide more timely and adequate assistance to people who cannot work and to provide needed supports to people with disabilities who can work. More than 19 million working-age institutional settings are not counted as Americans—10.9 percent of people ages part of the population available for 21 to 64—have a work disability, work.) according to data from U.S. Census Bureau’s March 2008 Current What do we know about people Population Survey (CPS). Work with work disabilities? disability applies to people in a variety of circumstances, including those who  The rate of work disability report that they have a health problem or increases with age: Five percent of a disability that prevents work or limits people in their 20s report a work the amount of work they can do, and disability, compared to 26 percent of people who report that they left a job or people in their 60s (Figure 1). retired for health reasons. People under However, roughly half of all age 65 who reported receiving certain working-age people with a work public benefits—Medicare, disability (47 percent) are under Supplemental Security Income (SSI), or age 50. veterans’ disability compensation—are also counted as having a work disability. Figure 1 Not all people with disabilities are Share of Working-Age Americans with limited in their ability to work. There are a Work Disability, by Age, 2007 nearly 50 million people in the United 26% States who report some kind of disability, but of these only 19 million 16% 11% 11% report a work disability.1 6% 5% The concept of work disability is subject to varying estimates and interpretations. 21-64 21-29 30-39 40-49 50-59 60-64 This fact sheet adopts the operational Age definition used in the CPS and reports Source: AARP Public Policy Institute estimates based on the characteristics of civilian, non- Current Population Survey, March 2008. institutionalized people of working age Note: Of the 176 million people ages 21 to 64 in the CPS, (defined here as ages 21 to 64) who have 19.1 million, or about 11 percent, had a work disability in 2007. a work disability. (People living in 19 Million Working-Age Americans Have a Disability that Limits or Prevents Work.  People with low levels of education receiving an early retirement benefit are most likely to experience work (i.e., those age 62 to 64) or are disability. About 22 percent of receiving Social Security benefits as people (ages 21–64) who did not a disabled spouse, widow(er), or finish high school reported a work other survivor, such as an adult child disability in 2007, compared to just with a disability. 6 percent of college graduates (Figure 2). Older people with a work disability are more likely than younger people Figure 2 with disabilities to be receiving any Share of Working-Age Americans Social Security benefit because early with a Work Disability, retirement benefits can be claimed by Educational Attainment, 2007 beginning at age 62 and because the 22% eligibility rules in SSDI acknowledge the difficulty of transitioning from 14% physically demanding work to desk 11% 11% 6% work for those age 50 and above.  Supplemental Security Income fills All Levels Did Not High Some College gaps. In 2007, roughly 19 percent of of Education Finish High School School Graduate College Graduate working-age people with disabilities received SSI (Figure 3). SSI is a Source: AARP Public Policy Institute estimates based on the Current Population Survey, March 2008. means-tested assistance program that provides a very modest monthly cash benefit and, in most, but not all,  Many people with work disabilities states, fairly automatic eligibility for are receiving Social Security Medicaid. Eligibility is limited to benefits. In 2007, 37 percent of people age 65 and above and people people who reported a work with disabilities who have very low disability received Social Security incomes and very limited assets (less benefits—primarily Social Security than $2,000). Some people who Disability Insurance (SSDI), but also receive Social Security benefits may retired worker benefits or survivor also receive SSI. When both sources benefits. A third of working-age of income are counted, more than people with work disabilities received Social Security only, and Figure 3 roughly 4 percent received both Share of People with Work Disabilities Who Social Security and Supplemental Receive Social Security, Security Income (SSI) (Figure 3). SSI or Both, by Age, 2007 Both Social Security and SSI 68% Nearly all of these Social Security Supplemental Security Income (but not Social Security) 3% Social Security (but not SSI) beneficiaries are receiving benefits 52% 53% 9% 45% 46% under SSDI, which insures against 4% 41% 5% 4% 4% 15% 4% 14% the loss of earnings due to severe and 19% 17% 21% 56% long-lasting disability. And, although 33% 34% it is not possible to distinguish 17% 21% 25% among different types of Social Security benefits (e.g., SSDI, retired 21-64 21-29 30-39 40-49 50-59 60-64 worker benefits, survivor benefits) Age with precision in these data, a Source: AARP Public Policy Institute estimates based on the relatively small proportion are likely Current Population Survey, March 2008. Note: Numbers may not sum to total due to rounding. 2 19 Million Working-Age Americans Have a Disability that Limits or Prevents Work. half of all people ages 21 to 64 with are poor, and more than half work disabilities received assistance (53 percent) live in low-income from Social Security and/or SSI in families (with family income below 2007 (Figure 3). 200 percent of the federal poverty line—an income of $21,574 for an  Despite limits on their ability to individual and $42,406 for a family work, many do work. In 2007, of four in 2007)3 (Figure 5). 29 percent of people with work disabilities reported at least some Figure 5 income from work in the past year, Share of People with Work Disabilities Who with younger people somewhat more Are Poor or Low-Income, likely to have had earnings than by Age, 2007 older people. Roughly 40 percent of Family Income between 100%-200% of Poverty people with work disabilities in their Family Income Below Poverty 20s and 30s reported income from 57% 57% 52% 56% 52% work in the past year, compared to 45% about 20 percent of people in their 24% 21% 26% 26% 24% 60s (Figure 4). A much smaller 24% proportion of people with work 34% 28% 31% 31% 28% disabilities work full-time and full- 21% year.2 21-64 21-29 30-39 40-49 50-59 60-64 Age Figure 4 Source: AARP Public Policy Institute estimates based on the Share of People with a Work Disability Current Population Survey, March 2008. Who Report Earnings from Work, by Age, 2007  Medicare and Medicaid play an 37% 39% important role for people with 29% 32% 25% 21% disabilities, providing health insurance coverage to more than 60 percent of working-age people with disabilities. Roughly a third of 21-64 21-29 30-39 40-49 50-59 60-64 working-age people with disabilities (34 percent) had health insurance Age coverage through Medicaid, the Source: AARP Public Policy Institute estimates based on the Current Population Survey, March 2008. publicly funded health insurance program for poor and low-income Americans (23 percent with  A very small proportion of people Medicaid only and 11 percent with with work disabilities both work both Medicaid and Medicare); about and receive Social Security. Only the same proportion was covered by 4 percent of working-age adults with Medicare (figure 6). (Workers with disabilities reported that they had disabilities who are receiving SSDI income from work and received benefits are eligible for Medicare Social Security benefits. after a two-year waiting period.) Another 5 percent of people with  Despite work and benefits, the work disabilities were covered by majority of people with work other public health insurance disabilities are poor or have low programs, primarily health care incomes. Nearly 30 percent of programs for the military and working-age people with disabilities 3 19 Million Working-Age Americans Have a Disability that Limits or Prevents Work. veterans, bringing the share covered  Women with work disabilities, by public sources to 62.3 percent. especially young women, are less Private health insurance coverage likely to be uninsured than work- (either employment-based or disabled men. Among people with individually purchased) plays a work disabilities in their 20s, more smaller role than public coverage; a than a quarter of men, but 15 percent quarter (23.1 percent) are privately of women, were uninsured. (Figure insured.4 (Figure 6) 7) Women with work disabilities are less likely to be uninsured than men Figure 6 because they are more likely to be Health Insurance Coverage of People with covered by Medicaid, the federal- Work Disabilities, 2007 state health insurance program for Uninsured, poor and low-income people. The Medicare, 15% 23% gender gap is closed at older ages, at least in part, because Medicaid is less likely to reach older women than Private Health younger women.5 Insurance, 23% Medicaid, Policy Challenges 23% Other Public Coverage, Both A key challenge facing policymakers is 5% Medicare and how to design public programs—and Medicaid, 11% encourage private employers—to Total = 19.1 Million People with Work Disability effectively support people with Source: AARP Public Policy Institute estimates based on the Current Population Survey, March 2008. disabilities in their efforts to secure and retain employment and achieve economic self-sufficiency.  In 2007, 15 percent of working-age people with work disabilities As unemployment rates have risen to lacked health insurance coverage their highest levels in 25 years, people (16 percent of men and 13 percent with work disabilities—who have low of women). Working-age people and, in recent years, declining rates of with work disabilities are actually employment—will likely face even somewhat less likely to be uninsured greater challenges.6 Unfortunately, than people without work existing federal programs provide little disabilities, 20 percent of whom assistance to people with work were uninsured in 2007 (Figure 7). disabilities who need income and other supports to achieve self-sufficiency. Figure 7 Wage subsidies (such as an expansion of Share of People with Work Disabilities Who the Earned Income Tax Credit) and Are Uninsured, access to comprehensive, affordable, and by Age and Sex, 2007 guaranteed health insurance coverage Men Women could go a long way toward improving 27% the economic well-being of people with 20% 19% work disabilities and their families. 16% 15% 13% 13% 14% 13%14% 7.5 10% 9% Supporting work and wages. The central problem is that the nation’s federal disability programs provide cash 21-64 21-29 30-39 40-49 50-59 60-64 benefits (and, subject to certain conditions, health insurance coverage) to Age Source: AARP Public Policy Institute estimates based on the Current Population Survey, March 2008. 4 19 Million Working-Age Americans Have a Disability that Limits or Prevents Work. people who are not able to work or who Today, the Social Security Administration earn only a very modest amount.7 continues to try to dig its way out of this Clearly, there are millions of people with very large—and deepening—hole. severe work disabilities who are not able Although backlogs have occurred at to work or who are not able to work full- different points in the history of the time or full-year at wages high enough program, there has been a substantial to sustain themselves and their families. deterioration in service over the past eight But, there are even larger numbers of years. The disability backlog has nearly people with work limitations who are doubled since 2001, rising from about willing and able to work, but are not 392,000 at the end of fiscal 2001 to more working because they lack job than 762,000 at the end of fiscal 2008.10 opportunities and adequate supports (assistance securing transportation, The Social Security Administration has paying for quality child care, etc.) or undertaken reforms and expanded hiring because they cannot work and earn to address the persistent backlog of enough to be economically independent. claims, but its efforts have been The current recession is likely to further hampered by a failure to finalize the erode opportunities. fiscal year 2009 appropriations.11 This left the agency operating at its 2008 Ensuring timely and adequate support funding level, which was already for people with disabilities who cannot insufficient. work or who are unlikely to achieve self-sufficiency through work. Until In a piece of good news, in March of this comprehensive reform is enacted, year, the President signed an appropriations renewed efforts must be made to ensure bill that provides $10.5 billion in timely access to SSDI and SSI benefits administrative funding for SSA for fiscal for people with severe and long-lasting 2009, a roughly 7 percent increase over the disabilities. fiscal 2008 funding level and the largest annual increase since fiscal 2001. In In SSDI, more than 762,000 people with addition, the President’s 2010 budget disabilities are waiting for a final request includes $11.6 billion in funding resolution of their application for benefits; for SSA, a 10 percent increase over the they can expect to wait a year and a half fiscal 2009 appropriation.12 These funding on average, and as long as three or four increases should help the Agency reduce years.8 Thousands of families suffer the long waits experienced by applicants extreme hardship during these and assure that disability benefits are unacceptably long waits. available on a timely basis to people who truly need them. States can use one modest option to ease the hardship for very low-income people Fact Sheet FS153, April 2009 with disabilities who have applied for SSI and, stuck in the same backlog, are Written by Ellen O’Brien and Carlos waiting for a decision. They can provide Figueiredo temporary cash assistance to people with AARP Public Policy Institute, disabilities who have applied for SSI. In 601 E Street, NW, Washington, DC 20049 2007, 37 states and the District of www.aarp.org/ppi Columbia provided such interim 202-434-3879, elobrien@aarp.org assistance.9 There is no similar © 2009, AARP. assistance for people awaiting a decision Reprinting with permission only. about SSDI. 5 19 Million Working-Age Americans Have a Disability that Limits or Prevents Work. NOTES 5 According to our estimates from the March 1 2008 CPS, 53 percent of work-disabled women The 2000 Census counted 49.7 million people with some type of long-lasting condition or in their 20s have Medicaid, compared to 38 of disability. They represented 19.3 percent of the work-disabled men in their twenties (a 257.2 million people who were aged 5 and older 15 percentage point gap). Among men and in the civilian noninstitutionalized population — women with work disabilities in their 60s, the or nearly one person in five. See U.S. Census gap is 8 percentage points (26 percent of women Bureau, Disability Status: 2000, available at: and roughly 18 percent of men have Medicaid). http://www.census.gov/prod/2003pubs/ In these statistics, we count people with c2kbr-17.pdf, and the discussion in the 2007 Medicaid only as well as people who are Institute of Medicine report, The Future of enrolled in both Medicare and Medicaid. Disability in America, Washington, DC: The 6 National Academies Press, p. 1. Estimates of the In February 2009, the national unemployment rate number of working-age people with work reached 8.1 percent, the highest level since disabilities also vary depending on the December 1983. U.S. Bureau of Labor Statistics, definitions and data sources used. For example, Employment Situation, February 2009, available at: estimates from the 2005 Survey of Income and http://www.bls.gov/news.release/pdf/empsit.pdf Program Participation data suggest that there 7 were 13.3 million people aged 16 to 64 Ellen O’Brien. 2009. “Social Security (7 percent of this population) who reported Disability Insurance: A Primer,” Publication I28, difficulties finding a job or remaining employed Washington, DC: AARP Public Policy Institute. due to a health-related condition. When the 8 Ellen O’Brien. 2009. “Social Security question was expanded to include people who Disability Insurance: A Primer,” Publication I28, report that they are limited in the kind or amount Washington, DC: AARP Public Policy Institute. of work they can do because of physical, mental, or other health condition, the number of people 9 Social Security Administration, 2008. “State with a work disability rose to 22.7 million people Assistance Programs for SSI Recipients,” January (11.9 percent of the population age 16 to 64). See 2007. http://www.socialsecurity.gov/ Matthew W. Brault, “Americans with policy/docs/progdesc/ssi_st_asst/2007/index.html Disabilities, 2005” Current Population Reports, P70-117, December 2008, available at: 10 In this instance, the backlog in question is the http://www.census.gov/prod/2008pubs/ backlog at the appeals level. The count refers to p70–117.pdf the number of people waiting for an appeals hearing before an Administrative Law Judge. If Fact Sheet 2 Andrew J. Houtenville, 2004, “Demographics an application for SSDI benefits is denied at this of People with Disabilities: Numerous Sources, stage, an applicant can appeal to the Appeals A Range of Estimates,” available at: Council and, subsequently, can file an action in www.nawrs.org/Oklahoma/WorkshopPapers/ Federal District Court. B2.houtenville.ppt 11 3 The Commissioner of Social Security has U.S. Census Bureau, “Poverty Thresholds for recently stated that “the effects of an extended 2007 by Size of Family and Number of Related continuing resolution are clearly slowing our Children Under 18 Years,” available at: progress.” Adequate and timely funding is http://www.census.gov/hhes/www/poverty/ needed to permit SSA to continue its effort to threshld/thresh07.html reduce the number of pending cases. See the 4 October 17, 2008 SSA news release, “Social This is the share of people who have private insurance and no public coverage. Because of the Security Continues to Make Progress Expediting way overlapping coverage is treated in producing Backlogged Disability Cases,” at: http://www.ssa.gov/ these estimates, this figure understates somewhat the share of people with work disabilities who pressoffice/pr/backlog-progress-pr-alt.pdf. have any private coverage. If all people with 12 See “Commissioner’s Broadcast, March 11, 2009” private health insurance coverage are counted, at ssa.gov/legislation/FY09Appropriation.pdf 38 percent of working-age people with a work disability have a private source of coverage. 6