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What Explains State Variation in SSDI Application Rates?

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Author Info

  • Norma B. Coe
  • Kelly Haverstick
  • Alicia H. Munnell
  • Anthony Webb

Abstract

Social Security Disability Insurance (SSDI) applications and receipts vary greatly by state. This paper investigates the extent to which this geographic variation in SSDI applications reflects differences in health, demographics, and employment characteristics, state policies, and politics. We find that demographic, health, and employment characteristics of the state have the greatest effect on state-level variations in SSDI application rates, explaining over 70 percent of the variation. State policy concerning mandated employer-sponsored disability insurance (also known as temporary disability insurance or TDI) has a small negative effect on overall SSDI applications. This finding supports the principle underlying many recent SSDI reform plans: temporary disability insurance coverage could save the SSDI program considerable funds in the long run. Further, when we look to explain variation within a state, we find that state changes in health insurance regulation are negatively correlated with the SSDI application rate. This could be an indication that the Affordable Care Act (ACA) may have spillovers to the SSDI program.

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File URL: http://crr.bc.edu/working-papers/what-explains-state-variation-in-ssdi-application-rates/
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Bibliographic Info

Paper provided by Center for Retirement Research in its series Working Papers, Center for Retirement Research at Boston College with number wp2011-23.

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Length: 37 pages
Date of creation: Nov 2011
Date of revision: Nov 2011
Handle: RePEc:crr:crrwps:wp2011-23

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Cited by:
  1. Matthew S. Rutledge, 2013. "The Impact of Unemployment Insurance Extensions On Disability Insurance Application and Allowance Rates," Working Papers, Center for Economic Studies, U.S. Census Bureau 13-10, Center for Economic Studies, U.S. Census Bureau.
  2. Lucie Schmidt, 2013. "The New Safety Net? Supplemental Security Income after Welfare Reform," Department of Economics Working Papers, Department of Economics, Williams College 2013-07, Department of Economics, Williams College.

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