The Health Care Crisis for People with Disabilities Who Do Not Receive Social Insurance Benefits
- Presenter:
Chair: Catherine McLaughlin; Discussant: Dan Polsky Tue June 6, 2006 8:00-9:30 Room 226
Rationale: The increasing number of people with disabilities under age 65 will profoundly affect public policy towards disability by increasing the administrative burden on programs such as Social Security Disability Insurance (SSDI) and Medicare. The aging of the baby boom population will substantially increase the number of people with disabilities who do not qualify for disability benefits. Failure to address the health care needs for persons with disabilities prior to retirement is likely to increase long terms costs to Medicare by increasing the severity of illness once these persons reach retirement age.
Objectives: This paper estimates the number of people with disabilities under age 65 who do not receive disability benefits and projects the number without benefits through 2025 to quantify the uncompensated health care burden of disability. A number of simulations are conducted to understand how changes in the underlying characteristics of the population will affect these projections.
Methodology: This study first estimates the number of people with disabilities in the population using a logistic regression model. Second, the proportion of people with disabilities who do not receive SSDI is estimated from this model. Third, health care expenditures for people with disabilities who do not receive benefits are estimated using a two-part generalized linear model. Finally, a simulation model is developed to explore the effects of different assumptions about the demographic characteristics and health conditions of the population on the prevalence of disability and health care expenditures. The 1996 panel of the Survey of Income and Program Participation is used to estimate the number of people with disabilities who do not receive benefits. The 1997 to 2000 Cost and Use Files of the Medicare Current Beneficiary Survey are used to estimate health care expenditures for people with disabilities who do not receive benefits, simulating costs as if they received benefits.
Results: Nearly 23% (2.8 million [M]) of people with disabilities did not receive SSDI benefits and had no recent work experience in 2000, and 67% (8.9M) of those with disabilities did not receive SSDI benefits overall. These estimates will increase to 3.7M and 11.4M respectively by 2025. Health care expenditures for people with disabilities without recent work experience and no SSDI benefits were estimated at $20.7 billion (B) in 2000 and will increase to $29.3B in 2025.
Conclusions: People with disabilities who do not receive SSDI benefits represent the hidden population of Americans with disabilities. The reported prevalence of disability is sharply reduced if only Social Security statistics are used. Results emphasize that the problem of uninsured losses among Americans with disabilities who do not qualify for social insurance benefits will be one of the most important, unsolved dilemmas for society created by the baby boom generation.
