Social Security disability recipients could face an automatic 19 percent reduction in benefits unless Congress acts quickly to replenish the system’s trust fund, according to the trustees that oversee both Social Security and Medicaid.
The trustees said the fund that provides these benefits is expected to run out of money by late 2016. When that happens, it will be up to tax revenue to fund the disability system, which will only cover about 60% of scheduled disability benefits.
They also projected that disability recipients would not see a cost-of-living increase at the end of 2015, something that has only happened twice since this annual increase was enacted in 1975.
About 11 million American rely on Social Security disability benefits. On average, disabled workers and their families receive $1,017 a month. If the benefits cut happens next year, that would drop by $193 a month.
Benefits for Social Security disability are funded through a small portion of the Social Security taxes employers and workers pay. Approximately 0.9% of earnings are placed in the disability fund and 5.3% in the retirement fund.
M. Stanley Whitehead is a Social Security attorney in Houston. If your disability claim was denied, contact her today for help getting the benefits you need.