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UNITED STATES DEPARTMENT OF LABOR

The effect of lower transaction costs on social security disability insurance application rates and participation (Foote et al., 2019)

Review Guidelines

Causal Evidence Guidelines

Absence of conflict of interest. 

Citation

Foote, A., Grosz, M., & Rennane, S. (2019). The effect of lower transaction costs on social security disability insurance application rates and participation. Journal of Policy Analysis and Management, 38(1), 99-123.

Highlights

  • The study’s objective was to measure the impact of the Social Security Administrations’ online iClaim system on changes in Social Security Disability Insurance (SSDI) applications, appeals, awards, and award rates. 

  • The authors used a difference-in-differences design to estimate the impacts of iClaim on SSDI applications, appeals, awards, and award rates. SSDI outcomes are measured at the county-level across the period 2004-2011 using data from the Social Security Administration’s (SSA) Disability Research File. Additional information about county-level demographics, labor market conditions, and internet connectivity are drawn from data collected by the Surveillance, Epidemiology and End Results (SEER) program, the Bureau of Labor Statistics (BLS), and Federal Communications Commission (FCC) reports. The authors used a statistical model to compare SSDI applications, appeals, awards, and award rates before and after the implementation of iClaim, across counties with varying levels of internet access.  

  • The study found a positive, statistically significant relationship between iClaim implementation and the number of SSDI applications, appeals, and awards. 

  • This study receives a moderate evidence rating. This means we are somewhat confident that the estimated effects are attributable to iClaim, but other factors might also have contributed. 

Intervention Examined

IClaim

Features of the Intervention

The Social Security Administration’s (SSA) iClaim platform is an online processing system for disability and retirement benefits claims. Introduced in December of 2008, the iClaim platform was designed to make it easier for individuals to file a claim without having to contact the SSA office via phone or in person. The program also increased the ability for individuals to track the status of their application and confirm its submission. Disability lawyers are also able to use the iClaim system to file appeals on behalf of their clients, a program feature intended to further lower costs for applicants. 

Features of the Study

This study used a difference-in-differences study design. The authors compared SSDI applications, appeals, awards, and award rates for counties with varying access to high-speed internet, before and after the implementation of iClaim in 2009. The authors constructed a county-level panel dataset that includes all U.S. counties between 2004 and 2011. Information on SSDI outcomes was drawn from the SSA Disability Research File. Information on high-speed internet use was drawn from FCC reports. Information on county demographic and labor market characteristics was taken from the National Cancer Institute’s Surveillance, Epidemiology and End Results (SEER) program, the Bureau of Labor Statistics, and the Bureau of Economic Analysis.  

Study Sites

All U.S. counties between 2004 and 2011. 

Findings

Public Benefits Receipt 

  • Applications: The study found a positive, statistically significant relationship between iClaim implementation and the number of SSDI applications. In counties with rates of internet connectivity one standard deviation higher than average, iClaim implementation was associated with a 1.6 percent increase in the number of SSDI applications. 

  • Appeals: The study found a positive, statistically significant relationship between iClaim implementation and the number of SSDI appeals. In counties with rates of internet connectivity one standard deviation higher than average, iClaim implementation was associated with a 2.8 percent increase in the number of SSDI appeals. 

  • Awards: The study found a positive, statistically significant relationship between iClaim implementation and the number of SSDI awards. In counties with rates of internet connectivity one standard deviation higher than average, iClaim implementation was associated with a 2 percent increase in the number of SSDI awards  

  • Award Rate: The study did not observe a statistically significant relationship between iClaim implementation and SSDI award rates.  

Considerations for Interpreting the Findings

The timing of iClaim implementation coincided with the Great Recession. Observed increases in SSDI applications might thus reflect economic upheaval caused by the recession, rather than the impact of the iClaim intervention. The authors recognize this issue and employ a placebo test using levels of spending on Medicaid, a social safety net program that did not have online application or enrollment portals at the time. The authors observe that, in contrast to the SSDI findings, levels of Medicaid spending were not higher in counties with higher rates of internet connectivity during and after the Great Recession (e.g., after the implementation of iClaim). The authors conclude that observed increases in SSDI applications, appeals, and awards in counties with higher than average internet connectivity were due to iClaim implementation and not to the impact of the Great Recession.      

Causal Evidence Rating

The quality of causal evidence presented in this report is moderate because it was based on a well-implemented non-experimental design. This means we are somewhat confident that the estimated effects are attributable to the iClaim intervention, but other factors might also have contributed. 

Reviewed by CLEAR

December 2022

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