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How Common is "Parking" Among Social Security Disability Insurance (SSDI) Beneficiaries? Evidence from the 1999 Change in the Level of Substantial Gainful Activity (SGA)

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Listed:
  • Jody Schimmel

    (Mathematica)

  • David C. Stapleton

    (Mathematica)

  • Jae Song

    (Social Security Administration)

Abstract

Fewer Social Security Disability Insurance (DI) beneficiaries have their earnings suspended or terminated because of work than those who are actually working, partly because beneficiaries "park" earnings at a level below substantial gainful activity (SGA) to retain benefits. We assess the extent of parking by examining how beneficiary earnings and months off the rolls for work responded to a 1999 change in the SGA level for non-blind beneficiaries from $500 to $700 per month. Specifically, our difference-in-difference analysis compares longitudinal data for two beneficiary cohorts with different incentives to park their earnings; one experienced the increased SGA level the first year after its Trial Work Period (TWP), when beneficiaries can earn any amount without losing benefits, while the two-year-earlier cohort did not. The impact of the increased SGA level is consistent with parking, but its magnitude small. The reduction in TWP completers with earnings less than $500 was 1.0 percentage points, the reduction in the percentage with earnings over $700 was 1.2 percentage points, and the increase for those with earnings between $500 and $700 was 2.2 percentage points. However, there was no change in mean earnings; small increases for those with relatively low earnings were offset by reductions for those with relatively high earnings. The SGA increase had a significant negative effect on the average number of months that beneficiaries were off the rolls for work; the effect was largest -- about six-tenths of a month -- for those who earned $500 to $700 during in year they completed their TWP.

Suggested Citation

  • Jody Schimmel & David C. Stapleton & Jae Song, 2010. "How Common is "Parking" Among Social Security Disability Insurance (SSDI) Beneficiaries? Evidence from the 1999 Change in the Level of Substantial Gainful Activity (SGA)," Working Papers wp220, University of Michigan, Michigan Retirement Research Center.
  • Handle: RePEc:mrr:papers:wp220
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    Cited by:

    1. repec:mpr:mprres:7471 is not listed on IDEAS
    2. Alexander Gelber & Timothy J. Moore & Alexander Strand, 2017. "The Effect of Disability Insurance Payments on Beneficiaries' Earnings," American Economic Journal: Economic Policy, American Economic Association, vol. 9(3), pages 229-261, August.
    3. Judith A. Cook & Jane K. Burke-Miller & Dennis D. Grey, 2015. "Impact of Contingent Work on Subsequent Labor Force Participation and Wages of Workers with Psychiatric Disabilities," Mathematica Policy Research Reports dc9fe635fb3940d6a5740964f, Mathematica Policy Research.
    4. Jody Schimmel & David C. Stapleton, 2011. "Disability Benefits Suspended or Terminated Because of Work," Mathematica Policy Research Reports db837c3be0584b4fbd7c0e78e, Mathematica Policy Research.
    5. Deuchert, E. & Eugster, B., 2016. "Crawling Up the Cash Cliff? Behavioral Responses to a Disability Insurance Reform," Health, Econometrics and Data Group (HEDG) Working Papers 16/21, HEDG, c/o Department of Economics, University of York.
    6. repec:mpr:mprres:7847 is not listed on IDEAS
    7. Yonatan Ben-Shalom & David Stapleton, 2013. "Trends in the Composition and Outcomes of Young Social Security Disability Awardees," Mathematica Policy Research Reports 11a2e93ee9b1466baf2365854, Mathematica Policy Research.
    8. David Dean & John Pepper & Robert Schmidt & Steven Stern, 2014. "State vocational rehabilitation programs and federal disability insurance: an analysis of Virginia’s vocational rehabilitation program," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-19, December.
    9. Eugster, Beatrix & Deuchert, Eva, 2017. "Income and Substitution Effects of a Disability Insurance Reform," Economics Working Paper Series 1709, University of St. Gallen, School of Economics and Political Science.
    10. repec:mpr:mprres:7077 is not listed on IDEAS
    11. Nicole Maestas & Kathleen J. Mullen & Gema Zamarro, 2012. "Induced Entry into the Social Security Disability Program: Using Past SGA Changes as a Natural Experiment," Working Papers wp262, University of Michigan, Michigan Retirement Research Center.
    12. Gina Livermore & Maura Bardos, "undated". "Characteristics of Disability Beneficiaries with High Earnings," Mathematica Policy Research Reports 92d70a2f8537401895c0e31ee, Mathematica Policy Research.
    13. Judith A. Cook & Jane K. Burke-Miller & Dennis D. Grey, 2015. "Reasons for Job Separations Among People with Psychiatric Disabilities," Mathematica Policy Research Reports daa83bfb114348c39b9966d28, Mathematica Policy Research.
    14. David Wittenburg & David R. Mann & David C. Stapleton, 2012. "Work Incentive Simplification Pilot WISP Recommendations of the Technical Advisory Panel Regarding the Evaluation Design," Mathematica Policy Research Reports 9764c47724f64b8c85f0b9a58, Mathematica Policy Research.

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