BUSINESS
06/03/2013 10:59 am ET

U.S. Disability Program To Run Out Of Money By 2016: Government

AP

America's disability benefits program was recently thrown into the middle of an ideological battlefield after This American Life, the WBEZ radio show hosted by Ira Glass, portrayed the disability program as a "de-facto welfare program."

Just a couple of months later, that very program appears dangerously close to becoming insolvent.

The program, which provides nearly 11 million people with disability insurance, is projected to run out of money in the next three years if lawmakers do nothing to shore up its funding, according to officials from the Social Security and Medicare programs. The fund has been paying out more than it brings in since 2009.

The disability insurance program, which is funded by payroll tax contributions from workers and employers, was the focus of a March This American Life episode that controversially portrayed the program as a way for struggling but able-bodied Americans to find some kind of economic security.

The Wall Street Journal published a similarly controversial story shortly after the This American Life episode aired. Both pieces relied on recent controversial research from MIT and University of Pennsylvania economists that found that more malleable conditions -- like back pain and mental disabilities -- are more likely to result in benefits claims than they were 20 years ago.

The reality, many economists say, is quite different from that depiction. Experts pointed to the fact that more than 60 percent of initial claims for disability benefits are denied, according to the Congressional Budget Office. The average wait time for the nearly 900,000 veterans seeking disability insurance is almost 300 days, according to a Yahoo! news report.

Still, disability claims have soared over the last several years, as the recession has forced Americans pushed out of work due to a disability to find ways to supplement their income. An aging population and the rise in medical technology, which has made it more likely for soldiers to survive war injuries, also contributed to the jump.

(Hat tip: The Wall Street Journal)

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