Association for Public Policy Analysis & Management

Panel: Removing the Disability Insurance “Cash Cliff”: Experimental Evidence from SSA’s Benefit Offset National Demonstration (BOND)

(Poverty and Income Policy)

The Social Security Administration (SSA) has a broad initiative to identify and test policies that have the potential to help Social Security Disability Insurance (SSDI) beneficiaries increase earnings and reduce reliance on SSDI benefits, thereby reducing the program’s total cost. A leading part of that initiative is the Benefit Offset National Demonstration (BOND). As part of the Ticket to Work and Work Incentives Improvement Act of 1999, Congress asked SSA to analyze the costs and benefits of replacing the SSDI cash cliff with a more gradual reduction in benefits, a “ramp” when earnings exceed substantial gainful activity. BOND tests this alternative policy. SSA, in conjunction with several contractors led by Abt Associates, developed the infrastructure and supports required to implement the $1 for $2 benefit offset analyzed in BOND.  The scope of the implementation is notable given that it includes large, nationally representative samples with a total size of nearly a million SSDI beneficiaries.

The panel will summarize findings from the “two stages” of BOND implementation.  Stage 1 examines how a national benefit offset would affect earnings and program outcomes for the entire SSDI population. In this stage, the demonstration randomly assigned beneficiaries into either a treatment group “T1” (subject to benefit offset rules and offered Work Incentives Counseling [WIC]) or a current-law control group “C1”.  Stage 2 tests the impact of the offset for those expected to be most likely to use the offset—recruited and informed volunteers. Stage 2 also analyzes the extent to which Enhanced Work Incentives Counseling (EWIC) affects impacts. In this stage, the demonstration randomly assigned volunteers into one of three assignment groups:  a treatment group “T21” (benefit offset rules and offered WIC), a second treatment group “T22” (benefit offset rules and offered EWIC), or a current-law control group “C2”.

The evaluation findings provide insights into the effects of changing incentives on employment- and benefit-related outcomes, as well as beneficiary perceptions of existing rules and the new changes.

The BOND evaluation team proposes a panel of three papers focused on the main impact findings of the demonstration. The paper abstracts submitted with this application include results already released by SSA but do not include other results unique to the final evaluation report. The final report is expected to be released by SSA later in 2018 prior to the fall conference.