Social Security Administration (SSA): FY2017 Appropriations and Recent Trends

Summary

The Social Security Administration (SSA) is responsible for administering a number of federal entitlement programs that provide income support (cash benefits) to qualified individuals. These programs are

Old-Age, Survivors, and Disability Insurance (OASDI), commonly known as Social Security;

Supplemental Security Income (SSI) for the Aged, Blind, and Disabled; and

Special Benefits for Certain World War II Veterans.

In FY2017, SSA’s programs are projected to pay a combined $1 trillion in federal benefits to an estimated 68.4 million individuals. The cost to administer these programs is projected to be about 1.3% of benefit outlays.

Although benefit payments for SSA’s programs are considered mandatory spending and thus are not controlled by the annual appropriations process, the agency requires annual discretionary appropriations to carry out its programs and to support the administration of non-SSA programs, such as Medicare, as well as various other priorities. The annual appropriation for SSA’s limitation on administrative expenses (LAE) account provides nearly all of the agency’s administrative funding. The LAE account is composed of funds from the Social Security and Medicare trust funds for their share of administrative expenses, the general fund of the U.S. Treasury for SSI’s share of administrative expenses, and user fees paid to SSA for certain administrative activities. Additional appropriations from Congress provide funding for SSI program costs, research and demonstration projects, SSA’s Office of the Inspector General (OIG), and certain payments to the Social Security trust funds. SSA’s accounts are traditionally funded through the Departments of Labor, Health and Human Services, and Education, and Related Agencies (LHHS) appropriations bill.

The FY2017 President’s budget request for SSA’s LAE account is $13.067 billion, which includes $1.819 billion for program integrity activities such as continuing disability reviews (CDRs) and SSI non-medical redeterminations. By comparison, the FY2016 appropriation for SSA’s LAE account was $12.162 billion, with $1.426 billion dedicated to program integrity work.

On June 9, 2016, the Senate Committee on Appropriations approved its FY2017 LHHS appropriations bill by a vote of 29 to 1. The Senate bill would provide $12.482 billion for SSA’s LAE account, which is 4.5% less than the amount in the FY2017 President’s budget request but is 2.6% more than the amount enacted for FY2016. On July 14, 2016, the House Committee on Appropriations approved its FY2017 LHHS appropriations bill by a vote of 31 to 19. The House bill would provide $11.899 billion for SSA’s LAE account, which is 8.9% less than the amount in the FY2017 President’s budget request and is 2.2% less than the amount enacted for FY2016.

On September 29, 2016, President Barack Obama signed into law the Continuing Appropriations and Military Construction, Veterans Affairs, and Related Agencies Appropriations Act, 2017, and Zika Response and Preparedness Act (H.R. 5325; P.L. 114-223), which contains the Continuing Appropriations Act, 2017 (Division C). The day before, H.R. 5325 was passed in the Senate by a vote of 72-26 and in the House by a vote of 342-85. The FY2017 continuing resolution (CR) provides continuing appropriations for 11 of the 12 annual appropriations bills (including the LHHS appropriations bill) through December 9, 2016. In general, discretionary accounts covered by the FY2017 CR are funded at the same rate and under the same conditions as they were in the FY2016 omnibus, minus an across-the-board (ATB) rescission of 0.496%. However, funding dedicated to SSA’s program integrity work is exempt from the ATB rescission, making the effective reduction to the total LAE account 0.438%. The funding level for the LAE account under the FY2017 CR is $12.109 billion.

Over the past several years, Congress has increased the amount of funding provided to SSA for program integrity work. This increase has allowed the agency to process more CDRs and SSI redeterminations, resulting in additional net savings to the federal government. However, funding for non-program integrity work during this period has essentially remained flat in nominal (unadjusted) terms. According to SSA and others, recently enacted funding levels for non-program integrity work have contributed to agency delays in processing other workloads, such as pending disability cases at the hearing level of the administrative appeals process.