In its 2020 budget proposal, the Trump administration is seeking more than $83 billion in total cuts to Social Security by 2029. Among the largest proposed cuts is one that would hit disabled Americans particularly hard—slashing in half the amount of retroactive Social Security disability benefits they can receive.
There are several proposals to cut costs related to the Social Security Disability Insurance program. The largest reduction is a projected $47.4 billion in savings through “new approaches to increase labor force participation.” No details are provided in the budget plan regarding these “approaches.”
In contrast, the next largest cut is explicitly addressed in the budget—$10 billion cut attributed to reducing the maximum amount of retroactive benefits a claimant can receive from 12 months to six.
The Social Security cuts drew fire from disability advocates, who pointed out that President Trump campaigned on protecting Social Security. In fact, when he announced his candidacy in June 2015 at Trump Tower, he said, “Save Medicare, Medicaid and Social Security without cuts. Have to do it.”
“The President made explicit campaign promises to the American people that he would not negatively impact Social Security,” Pond Lehocky Stern Giordano Partner Tom Giordano Jr. said. “Unfortunately, his 2020 budget does not live up to that vow and if implemented would drastically reduce the amount of benefits a disabled individual would receive in retroactive or back pay.
The cut to retroactive benefits could have a profound effect on disabled Americans, who often more than a year from the time they apply for a hearing before an administrative law judge.
“This cut would negatively impact all Americans, regardless of political affiliation, should they need Social Security Disability,” Giordano said.
Increasing wait times, decreasing benefits
During the wait for a hearing, disabled workers face a difficult time without any income. When finally approved, a Social Security disability claimant may be eligible to receive retroactive money from the onset of their disability to cover the time spent waiting a decision.
However, the retroactive amount is already reduced via a mandatory five-month “waiting period” for which they are unable to receive benefits. The Social Security Administration says on its website that five-month waiting period is intended to ensure “that during the early months of disability, we do not pay benefits to persons who do not have long-term disabilities.”
Meanwhile, the process for obtaining benefits is already long, typically taking anywhere from 18 to 24 months to get a hearing and receive an award of benefits. The Trump administration plan will make a larger portion of that time ineligible for benefits. Thus, if the proposal succeeds, it will be even harder for claimants to recoup the all the losses they incur waiting for a decision.
An insurance program, not a ‘handout’
The cuts are just the latest front in the assault on Social Security disability. The language of the national discourse, alone, shows the damage that has been done, with words like “entitlement” and “handout” increasingly bandied about.
The truth is that Social Security disability benefits are funded by money that American workers have earned. It is a disability insurance program that all American workers pay into with automatic paycheck withholdings known as FICA. Employees pay 6.2 percent of every paycheck toward FICA taxes. Self-employed individuals pay 12.4 percent.
Those funds are used to fund three things: a retirement plan, Medicare and a disability insurance plan that will cover them if they suffer an injury or illness that prevents them from working. Thus, there is no reason that disability should be viewed any different than an insurance policy, as opposed to government assistance.
“We should never forget that we, American workers pay into this system. It’s not an entitlement. It’s your money, placed in a trust for when you need it most, ” Giordano said. “This budget clearly misses that point.”
Your voice needed
The reality is that with a Democratic-controlled House of Representatives, Trump’s 2020 budget proposal has little chance of passing, but that will not stop the assault on Social Security disability. Future proposals will be offered, and other strategies will be used.
It is important to remember that your elected officials are public servants who represent you. Let them hear your voice on this and other issues.
Meanwhile, Pond Lehocky will continue fighting for hard-working Americans, getting clients the benefits they deserve. If you need help in legal matters, speak with our intake specialists today for a free consultation.