Federal benefits for the elderly, blind, and disabled have not been updated in years.
Some lawmakers and advocates are now pushing for changes to the program, known as Supplemental Security Income, or SSI, to be included in legislation being considered in Congress.
However, it is unclear whether this will occur.
House Democrats’ initial budget proposal did not include proposed SSI reforms.
Nonetheless, a Senate Finance subcommittee held the first hearing on the program since 1998 this week, indicating that Senate leadership, particularly Sens. Sherrod Brown, D-Ohio, and Ron Wyden, D-Ore., intend to fight for it in the future. Brown, who reintroduced the Supplemental Security Income Restoration Act in June, presided over the hearing.
However, hopes for comprehensive SSI reform in the package may be dashed as lawmakers work to reduce the total cost of the Build Back Better package from $3.5 trillion.
However, there may be room for more incremental changes to the program, which has been largely unchanged since 1972.
Brown recently stated that he intends to push for the inclusion of as many of the proposed SSI reforms as possible. At the very least, he said, this would entail raising the asset limits for beneficiaries. Advocates argue that the SSI Restoration Act would update the program’s rules, many of which have been in place for years and are out of date.
SSI pays monthly benefits to Americans who have little or no income and are over the age of 65, blind, or disabled. The funds are used to meet basic needs such as food, clothing, and shelter.
The benefits are received by approximately 8 million people, including adults, disabled children, and seniors.
Some lawmakers and advocates argue that the program’s benefits are out-of-date and burdened by unfair rules.
According to the Social Security Administration, the average monthly SSI payment is around $586. The maximum monthly benefit is $794, which is 75% of the federal poverty line. Furthermore, there are strict asset limits, with a single beneficiary being able to have up to $2,000 in savings. That has remained unchanged since 1989.
Beneficiaries are also subject to strict income limits. They can only keep up to $65 of their earnings each month if they work. Earnings above that level reduce benefits by $1 for every $2 earned.
While SSI recipients are eligible for other benefits, including Social Security, they are only allowed to keep $20 per month. If their benefits exceed that amount, their SSI benefits are cut in half, dollar for dollar.
SSI benefits were dubbed the “forgotten safety net” during a 1987 House Ways and Means hearing, according to Brown, who testified this week before a Senate subcommittee. Brown’s proposed SSI Restoration Act would increase SSI benefits by 31%, bringing them up to the federal poverty level. It would also make those benefits inflation-proof.
The proposal also raises the asset limits to $10,000 for individuals and $20,000 for couples, up from $2,000 and $3,000, respectively.
Beneficiaries would also be able to earn up to $399 per month through work while also receiving up to $123 per month from other sources such as Social Security or veterans benefits, among other changes.
According to an Urban Institute analysis, proposed changes would help lift approximately 3.3 million people out of poverty and reduce the poverty rate among SSI recipients by more than half. These changes come at a higher price. According to the Social Security Administration, the proposal would increase SSI payments by about $510 billion between 2022 and 2030.
This may discourage lawmakers from including the entire proposal as they work to reduce the overall cost of the sweeping Democratic legislation.
According to Romig, there is still hope that some SSI changes will be implemented.
If lawmakers are unable to pass the entire SSI proposal, they may be able to include some provisions.
Not everyone believes that SSI will be included in the final draft of the legislation. According to Jason Fichtner, vice president and chief economist at the Bipartisan Policy Center, in order to get SSI reform into the Build Back Better reconciliation bill, advocates will have to fight against every other Democratic priority lawmakers are trying to cram in.
However, the current debate helps to draw attention to SSI, which often gets lost in the shuffle despite being designed for the poorest of the poor, according to Fichtner.