Delin, B., Hartman, E., & Sell, C. (2014). Given time it worked: Positive outcomes from a SSDI benefit offset pilot after the initial evaluation period. Journal of Disability Policy Studies, 1-11.
- The study’s objective was to examine the impact of Wisconsin’s Benefit Offset Pilot Demonstration (BOPD), which provided a more-generous work incentive for Social Security Disability Insurance (SSDI) recipients, on recipients’ employment status and earnings.
- Although the original evaluation of BOPD was a randomized controlled trial, this study focused on the outcomes of a nonrandom subset of BOPD participants who had completed a trial work period (TWP). Data sources included Wisconsin Unemployment Insurance administrative records and Social Security Administration (SSA) administrative data to evaluate study sample outcomes for 2009 and 2010.
- The study found that treatment group members who completed a TWP were significantly more likely to be employed or earn at least three times more than the substantial gainful activity (SGA) amount than control group TWP completers over the eight quarters of follow-up. However, there were no significant impacts on earnings.
- The quality of the causal evidence presented in this report is moderate because it is based on a well-implemented nonexperimental design. This means we have confidence that the effects estimated in this study are attributable at least in part to the BOPD. However, as with any nonexperimental analysis, other factors not accounted for in the study could also have contributed to the estimated effects.
The Benefit Offset Pilot Demonstration
Features of the Intervention
Administered by SSA, the BOPD was a pilot test of the later Benefit Offset National Demonstration. The primary intervention was a benefit offset that replaced the so-called cash cliff SSDI recipients who work eventually experience. The cash cliff refers to the fact that SSDI recipients who have completed a nine-month TWP followed by a three-month grace period have all their SSDI benefits suspended or terminated if they earn more than a threshold amount known as substantial gainful activity (SGA). The benefit offset replaces the complete loss of all benefits for working SSDI recipients, instead gradually withdrawing the SSDI benefit by $1 for every $2 earned above the SGA amount. SSA discontinued benefit offset eligibility for BOPD treatment subjects who had not completed a TWP by December 31, 2008, which was two years earlier than BOPD treatment subjects had initially been told their benefit offset eligibility would expire.
BOPD was implemented in four states: Connecticut, Utah, Vermont, and Wisconsin. Apart from recruiting SSDI recipients who received benefits solely based on their own earnings records, had completed a trial work period within the past 72 months, and were not concurrently receiving Supplemental Security Income benefits, the states were free to select their own program eligibility criteria. The Wisconsin BOPD went into effect in August 2005 and was a collaboration of the Wisconsin Department of Health Services, the University of Wisconsin-Stout, and the University of Wisconsin-Madison. Referred to as the Pathways Project, all aspects of the intervention—from recruitment to service provision— were administered through 21 nonprofit provider agencies across the state. Program enrollment ended after October 2006.
Features of the Study
This study examined employment and earnings impacts among 419 Wisconsin BOPD participants based on (1) whether the participants were assigned to the treatment or control group and (2) whether the participants completed a TWP by December 31, 2008—within three years of random assignment.
Although the BOPD was a randomized controlled trial, this study was not because it grouped subjects into treatment and comparison groups based in part on a post-random assignment characteristic—TWP completion before 2009. However, the authors demonstrated that there were no statistically significant differences in baseline characteristics between the treatment and comparison groups compared in the study.
The authors analyzed outcome data from Wisconsin Unemployment Insurance administrative records. In addition, they used SSA administrative records and BOPD data on participants’ characteristics and treatment group assignment.
- Treatment group members who completed a TWP were 3 percentage points more likely to be employed relative to control group members who completed a TWP at the eighth quarter of follow-up. In addition, treatment group TWP completers were 5.6 percentage points more likely to earn at least three times the SGA amount than control group TWP completers. These differences were statistically significant.
- Among TWP completers, there were no statistically significant impacts on earnings.
Considerations for Interpreting the Findings
The volunteers who participated in the BOPD are not likely to be representative of the larger SSDI recipient population because they were typically recruited from organizations that helped clients obtain employment, and are therefore likely to be representative of the 20 percent of SSDI recipients who reported an expectation of returning to work. In addition, the decision by SSA to restrict eligibility to SSDI recipients who completed their TWP within the past 72 months disqualified potential participants with longer work histories; these people might have benefited the most from the program.
Causal Evidence Rating
The quality of the causal evidence presented in this report is moderate because it is based on a well-implemented nonexperimental design. This means we have confidence that the effects estimated in this study are attributable at least in part to the BOPD. However, as with any nonexperimental analysis, other factors not accounted for in the study could also have contributed to the estimated effects.