Academic journal article Social Security Bulletin

Adult Oasdi Beneficiaiaries and Ssi Recipients Who Need Representative Payees: Projectioions for 2025 and 2035

Academic journal article Social Security Bulletin

Adult Oasdi Beneficiaiaries and Ssi Recipients Who Need Representative Payees: Projectioions for 2025 and 2035

Article excerpt

For Social Security beneficiaries and Supplemental Security Income recipients who are not capable of managing their own benefit payments, the Social Security Administration (SSA) pays benefits to a representative payee. We estimate that the demand for representative payees will increase from 2.94 million beneficiaries in 2013 to 3.27 million by 2025 and to 3.56 million by 2035. Growth in the number of retired-worker beneficiaries by 2025, and the transition of the baby boom generation into the 85-or-older age category by 2035, account for much of the increased demand for representative payees. Although 71.1 percent of disabled-worker beneficiaries who need a payee have a family member serving in that role, only 57.3 percent of retired-worker beneficiaries do. SSA should be prepared to recruit payees in numbers sufficient to meet the future demand, and to devote the resources necessary to monitor payees and prevent their misuse of benefits.

Selected Abbreviations

GAO Government Accountability Office

MINT Modeling Income in the Near Term

OASDI Old-Age, Survivors, and Disability Insurance

SSA Social Security Administration

SSI Supplemental Security Income


The Social Security Administration (SSA) sends monthly cash payments to people who qualify for benefits under the Old-Age, Survivors, and Disability Insurance (OASDI) program and to those who qualify for payments under the Supplemental Security Income (SSI) program. Some people who qualify for monthly payments under these programs have a health condition that prevents them from managing their benefit payments. When a program participant is deemed incapable of managing his or her own monthly benefit, SSA sends the payment to a representative payee-a person or organization designated by SSA to act on the beneficiary's behalf.

Over the next two decades, the number of people receiving benefits from the OASDI and SSI programs will increase because of demographic factors such as the aging of the baby boom generation. The increase in the number of program participants will most likely lead to an increase in the need for representative payees. Although many beneficiaries will have a family member who can serve as a payee, others will not, and SSA will need to find suitable representative payees for them. Expressing concern that SSA has not adequately planned for the increasing numbers of program participants who will need a representative payee, the Government Accountability Office (GAO, 2013) recommended that SSA estimate the long-term increase in the number of individuals who will need a payee, their demographic characteristics, and the resources that will be needed to meet the increased demand. We address that recommendation by projecting the number and demographic characteristics of beneficiaries who will need a payee. These findings provide the foundation for a strategic plan to administer the representative payee program effectively in the future.

We use administrative data from SSA and program participation projections from Modeling Income in the Near Term (MINT) to estimate the increase in the number of adult OASDI beneficiaries and SSI recipients who will need a representative payee. We study beneficiaries aged 18 or older who are not receiving benefits as disabled adult children or as students aged 18-19. We focus on this group because minor children, disabled adult children, and students aged 18-19 generally have a parent or other family member serving as their payee. To develop our projections, we disaggregate program participants into groups categorized by beneficiary type and age. For each disaggregated group, we compute the proportion of participants with a representative payee and the distribution by type of payee. We then apply the group proportions and the distributions by payee type to the MINT program participation projections for 2025 and 2035. The disaggregated numbers allow us to account for changing distributions by age and type of beneficiary over time, and the results allow SSA to develop plans to target outreach efforts. …

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