Social Security Trustees Report: DI Trust Fund Solvency Gains 13 Years
The long-term financial status of the Disability Insurance (DI) Trust Fund improved in 2019 adding 13 more years of solvency, according to the Social Security Board of Trustees 2020 annual report released April 22.
The DI Trust Fund is expected to remain solvent until 2065, in comparison to the Trustees’ estimate of 2052 in 2019. The projection draws from a complex range of demographic, economic and social data, trends and assumptions. In particular, the Trustees cite two factors affecting its calculations: the Social Security Administration’s effort to reduce the hearing backlog and changes in claims adjudication. Both SSDI applications and the number of individuals awarded DI benefits continued to decline.
Disability incident rates, which have trended down over the past 10 years, are expected to gradually rise in the future, according to the report. Also, estimated labor force participation, wages and unemployment assumptions were considered in the calculation.
However, the projections do not reflect any potential effects of the COVID-19 pandemic on the Social Security program. “Given the uncertainty associated with these impacts, the Trustees believe it is not possible to adjust estimates accurately at this time,” said Social Security Commissioner Andrew Saul. “The duration and severity of the pandemic will affect the estimates in this year’s report and the financial status of the program, particularly in the short term.”
The 2020 report also said reserves of the Old-Age and Survivors Insurance Trust Fund are projected to become depleted in 2034, the same as last year.
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