If Congress doesn’t act, people receiving Social Security disability benefits could see a nearly 20 percent cut to payments at the end of next year, according to the latest version of the Social Security trustees report released Wednesday.
The disability trust fund will be depleted by the fourth quarter of 2016, leaving the administration with enough income to pay 81 percent of benefits, according to the report, which is updated annually.
The health of the Social Security program didn’t change by much, and the cut to disability benefits has been expected for years. But now that Congress has still not come up with a compromise for boosting the funding, the shortfall is more imminent. As explained in the report’s summary:
“Social Security’s Disability Insurance (DI) Trust Fund now faces an urgent threat of reserve depletion, requiring prompt corrective action by lawmakers if sudden reductions or interruptions in benefit payments are to be avoided.”
The cuts would most immediately affect the 10.9 million people receiving disability benefits as of 2014, but other beneficiaries could see benefit cuts down the line. If Congress doesn’t act to reform the program, the trust fund used for retirement benefits would be depleted by 2035, a year later than previously expected.