Hatch: We Should Not Delay in Reforming the DI Program

In a speech on the Senate Floor, Utah Senator Says, “We should not delay confronting the obvious need for reform.”

WASHINGTON – In a speech on the Senate floor today, Finance Committee Chairman Orrin Hatch (R-Utah) outlined legislation he introduced to reform the Social Security Disability Insurance (DI) Program and reiterated the immediate need to address issues facing the DI program.

“Today I have introduced three separate bills designed to help update and improve the administration of the DI program,” Hatch said. “As we talk about solutions to address depletion of the DI Trust Fund, we should also be talking about ways to update the DI program, ways to make it easier for beneficiaries who can and desire to return to work to be able to explore those opportunities, and ways to improve efforts to deter and prevent waste and fraud.”

Hatch also raised concerns with Social Security and called on the Obama Administration and Senate colleagues to work toward serious reforms.

“It isn’t just the DI program that has problems.  Social Security, in general, faces a number of significant fiscal and policy challenges,” Hatch said. “The sooner we act to put Social Security on a sustainable financial path, the better it is for Americans and their security. If we’re going to get there, it’s going to require bipartisan cooperation on both ends of Pennsylvania Avenue.  “

The complete speech, as prepared for delivery, is below:

     Mr. President, I rise today speak once again on the Social Security Disability Insurance – or DI – program. 

     As everyone in this Chamber should know, the DI Trust Fund is projected to be exhausted next year.  That means that, absent any change in law, we’ll be seeing across-the-board benefit cuts of close to 20 percent for DI beneficiaries. 

     Over the last several months, I’ve come to the floor on a handful of occasions to talk about this program and the imminent depletion of its trust fund.  I’ve called on my colleagues on both sides of the aisle to work with me to address these issues, and I’ll repeat that call here today.

     In addition, today I have introduced three separate bills designed to help update and improve the administration of the DI program.  As we talk about solutions to address depletion of the DI Trust Fund, we should also be talking about ways to update the DI program, ways to make it easier for beneficiaries who can and desire to return to work to be able to explore those opportunities, and ways to improve efforts to deter and prevent waste and fraud.

     The first bill I introduced today would update and expand the Social Security Administration’s tools to deter and punish fraudsters who cheat the system

     The second bill would authorize the Commissioner of SSA to provide denied DI applicants with information about employment support services provided by both public agencies and private nonprofit organizations.  That information will help denied applicants find opportunities to re-enter the workforce instead of continually cycling through the DI application process.

     The third bill would require SSA to review hearing decisions by Administrative Law Judges to ensure that they are following the law as well as Social Security regulations and policies.

     All three of these bills are designed to improve the administration of the DI program and make it work better for beneficiaries and taxpayers.  They will not, by themselves, solve all of the program’s fiscal problems, but they will improve the DI system. 

     More work will need to go into this effort, and, as chairman of the committee with jurisdiction over the DI program, I am committed to solving these problems and preventing the massive benefit cuts that we’ll see under current law. 

     Mr. President, I’d like to point out three things about my stated approach to dealing the with the DI program.  

     First, you’ll note I have not used the word “crisis” to describe what’s happening with the DI Trust Fund. 

     Second, you would be hard pressed to find any proposal that I’ve submitted that could credibly be characterized as “slashing” DI benefits. 

     And, third, nothing I have put forward, either today or in the past, could conceivably be thought of as “privatizing” Disability Insurance. 

     I have to point this out, Mr. President, because a number of people – including some of my friends on the other side of the aisle – have described Republican efforts to address the DI Trust Fund depletion using some of those very same words.  These individuals are apparently more interested in turning this issue – and the coming benefit cuts – into a political football than in actually solving the problem.

     My question is: What good will that do for the DI program or its beneficiaries?  

     It isn’t just the DI program that has problems, Mr. President.  Social Security, in general, faces a number of significant fiscal and policy challenges. 

     In their most recent report, the Social Security Board of Trustees, which includes several members of President Obama’s cabinet, recommended “that lawmakers address the projected trust fund shortfalls in a timely way in order to phase in necessary changes gradually and give workers and beneficiaries time to adjust to them.”

     That, to me, says that the sooner we act to put Social Security on a sustainable financial path, the better it is for Americans and their security.  It clearly does not mean that we should ignore the financial problems facing Social Security or kick the can down the road hoping that some future Congress will get its act together and solve the problem.

     Of course, providing financial sustainability to Social Security is easier said than done.  There are reasonable disagreements over how best to address Social Security’s fiscal shortfalls, including different views on payroll tax revenues that fund the programs and how quickly promised benefits will grow in the future.     

     Yet, we should not limit the discussion to taxes and outlays.  We also should look at how the programs can be improved and brought up to date. 

     For example, the vocational grids and medical guidelines that SSA uses in the disability program are woefully out of date.  And, much of the existing structure of Social Security’s retirement program was developed long ago, when labor markets and work patterns were much different than they are today. 

     We should be working to address all of these challenges – both the fiscal and the policy challenges – now, instead of putting them off for later dates. 

     With respect to the DI program in particular, I have been working for some time now to obtain input from experts and stakeholders across the spectrum to figure out how we can make the program work better.  Joined by House Ways and Means Committee Chairman Ryan and Social Security Subcommittee Chairman Johnson, I have solicited input from stakeholders in various venues and continue to welcome ideas or proposals from anyone who wants to submit them.

     The bills I’ve dropped today are just the latest in a series of bills I’ve introduced to help jumpstart the discussion on DI reform. 

     We should not sit idly by and wait for another financing cliff to appear around the end of next year.  As the Social Security Trustees made clear, the sooner Congress acts to address these shortcomings, the better.  Neither DI beneficiaries nor taxpayers benefit from lingering uncertainty about how the impending trust fund depletion will be resolved.

     So, as I’ve said many times before, I’m ready and willing to have this conversation.  Sadly, up to now, I’ve heard nothing in response from the Obama Administration and very little from my colleagues on the other side of the aisle. 

     Anyone familiar with the current state of the DI trust fund would likely acknowledge that we’re going to have to reallocate resources into the fund if we’re going to prevent the impending benefit cuts from happening next year. 

     Most proposals I’ve seen – including those from the President’s budget – involve a reshuffling of money from Social Security’s retirement fund to the DI Trust Fund.  

     But, even if we have to reallocate resources to shore up the DI program, we should NOT delay confronting the obvious need for reform.  On this point, I’ll once again quote the most recent report from the Social Security Trustees, which said:  “Reallocation of resources in the absence of substantive reforms might…serve to delay DI reforms and much needed corrections for [Social Security] as a whole.”

     It’s true, as many of my colleagues have noted, that there have been bipartisan agreements to reallocate resources within Social Security in the past.  However, in virtually every case, the reallocations were accompanied by substantive policy changes. 

     This time should be no different. 

     The last time we reallocated resources from the retirement to the DI trust fund, DI awards were increasing unexpectedly and Congress needed time to examine the reasons for this increase before acting to change the way the DI system worked.  At the time, most people agreed that reforms were necessary, and that the reallocation would buy the time Congress needed to come up with those reforms, get them enacted, and put the trust fund on sound fiscal footing.

     That was more than 20 years ago.  And, sadly, though not surprisingly, Congress did not follow through with the reforms and we now face another reserve depletion in the trust fund. 

     Needless to say, doubling down on that same strategy – a strategy that has already failed to produce the needed policy changes – is NOT a prudent course of action.  In my view, any resources reallocation that gets enacted MUST be accompanied by changes in the DI program. 

     However, the President does not seem to share this view. 

    The administration has called for a stand-alone reallocation of payroll tax receipts away from the retirement and survivors trust fund and into the DI trust fund.  This proposal would, depending on the estimate, extend the life of the DI program to the early 2030s, at which point both Social Security Trust Funds – disability AND retirement – will be exhausted at the same time, triggering massive benefit cuts for all beneficiaries. 

     That is their idea of a responsible approach to a widely acknowledged fiscal problem. 

     Outside of the stand-alone reallocation scheme, the President’s budget offers precious little in the way of reforms to the DI program or Social Security in general.  In other words, the Obama Administration’s entire answer to all of Social Security’s many fiscal problems is literally to just let future Congresses and administrations deal with them. 

     This, to me, would be the height of irresponsibility.  While it may not be possible, absent some kind of resource allocation, to keep the DI program’s current promises between now and the end of next year, we can and should take meaningful steps now to improve the program. 

     That is my goal.  I hope enough of my colleagues share this goal to make it a reality. 

     If we’re going to get there, it’s going to require bipartisan cooperation on both ends of Pennsylvania Avenue.  In other words, we’re going to need to see more from the administration that we’ve seen thus far.   

     It is already August.  Despite my repeated requests for the administration and my friends on the other side of the aisle to engage with me to work on this issue, I have yet to hear a meaningful response.  

     I hope that will change. 

     There is no harm in discussing options.  And, I’m willing to discuss any and all options to fix these problems.  There is, on the other hand, a great deal of potential harm to DI beneficiaries if we continue to ignore the problem while waiting for a financial cliff to force people’s hands.  

     Once again, Mr. President, I urge my friends on both sides of the aisle to engage on this issue now and not wait until it is too late to take meaningful action.

     With that, I yield the floor.

###

• Print
• Email
• Tweet