THE BLOG

Why Sequestration Harms Seniors and Costs Taxpayers

03/01/2013 03:35 pm ET | Updated May 01, 2013

This week, Congress voted on a plan to avert the March 1 sequester without harming Social Security, Medicare, or Medicaid. The legislation did not pass; therefore cuts imposed by sequestration will be gradually implemented.

While Social Security benefits are exempted from sequestration, the Social Security Administration (SSA), which administers the benefits, is not. Cuts to the SSA budget will weaken program oversight and could make it more difficult to pay benefits accurately and for mistakes to be promptly corrected.

Two straight years of budget cuts and hiring freezes have crippled Social Security's ability to handle dramatic workload increases, and the additional cuts required under sequestration will cause further erosion.

Office hours nationwide have been slashed by 23 percent, which has had a detrimental effect on processing new claims. In most offices, citizens have to wait more than 30 days to get an in-person meeting or telephone interview to file benefit applications or complete appeal requests. The odds of getting a busy signal when calling the toll-free number have tripled in the past six months alone, with 16 percent of citizens unable to reach even the automated menu when they call.

In light of sequestration, the Social Security Administration intends to fire more than 1,500 temporary employees, cut nearly all overtime and leave unfilled more than 5,000 positions as employees retire. It will take half a year to process each new disability claim, up from 111 days currently, and the backlog of pending claims will grow from 861,000 at the end of fiscal 2012 to more than 1 million by the end of fiscal 2013. Rural beneficiaries would be particularly hard-hit.

In a calculation that only makes sense in Washington, cutting Social Security's operating budget will actually end up costing taxpayers and adding to our nation's deficit. That's because the agency will have little staff available for conducting two types of money-saving reevaluations: continuing disability reviews, which yield $9 in savings for every $1 spent; and Supplemental Security Income redeterminations, which yield $6 in savings for every $1 spent. Scaling back these two reviews due to sequestration would cost the government at least $500 million over 10 years, according to a report by the Senate Appropriations Committee.

Congress could have acted this week to stop these automatic cuts and begin to put the nation on a rational fiscal path. The American Family Economic Protection Act would have saved $120 billion for the rest of 2013 by cutting $55 billion in spending, raising $55 billion in revenues and saving $10 billion in interest payments. The bill raises revenues by requiring millionaires and corporations to pay their fair share in taxes, including a minimum tax. It eliminates tax breaks for corporations that send jobs overseas. It also recognizes savings from no longer having to spend money for the war in Afghanistan and cuts unnecessary farm subsidy payments. The fairness outlined in this plan that does not harm vital services that retirees need and needs to be pursued in future budget discussions.

Witold Skwierczynski is president of the American Federation of Government Employees National Council of SSA Field Operations Locals, which represents about 25,000 Social Security employees in field offices and telephone centers nationwide.

Barbara J. Easterling is president of the Alliance for Retired Americans. She was previously the secretary-treasurer of the Communications Workers of America. For more information, visit www.retiredamericans.org or call 1-800-333-7212.