Policy Basics: Introduction to Supplemental Security Income
February 27, 2014
What Is the Supplemental Security Income Program?
The federal Supplemental Security Income (SSI) program provides monthly cash assistance to people who are disabled, blind, or elderly and have little income and few assets. SSI is distinct from the Old-Age, Survivors, and Disability Insurance (OASDI) programs commonly known as Social Security, though many SSI recipients have worked enough that they also collect Social Security and the Social Security Administration runs both programs.
In December 2013, 8.4 million people collected SSI benefits. For nearly three-fifths of recipients, SSI is their only source of income.
Who Qualifies for SSI, and What Benefits Do They Receive?
To qualify for SSI, applicants must be aged or disabled and have little or no income and few assets. SSI recipients are limited to $2,000 in assets for individuals and $3,000 in assets for couples, with certain exceptions. Children with disabilities may also qualify for SSI, since a child's disability may impose additional costs on his or her caregiver.
In 2014, the basic monthly SSI benefit is $721 for an individual and $1,082 for a couple. These amounts are reduced for recipients who have other sources of income or who live in a Medicaid facility or with someone else who provides support. Because of these reductions, the average SSI monthly benefit for individuals was only $529 in December 2013. Many states supplement the federal SSI benefit, though budget cuts are crimping those additional payments.
In most states, anyone who receives SSI benefits is automatically eligible for Medicaid. About half of SSI recipients also get SNAP (food stamps), and about one-quarter receive housing assistance.
How Has SSI Changed Over Time?
Since SSI began in 1974, the number of SSI recipients has slightly more than doubled. Over that time, SSI has changed from a program that mainly supplemented Social Security income for elderly adults to a broader antipoverty program that aids the disabled of all ages. SSI is increasingly important for children and adults with disabilities, partly as a result of policy changes in 1984 that expanded eligibility based on mental impairments and a 1990 Supreme Court ruling that liberalized the SSI disability criteria for children -- changes that Congress partly rolled back in 1996.
The vast majority -- 86 percent -- of all SSI recipients in 2012 were eligible because of a disability, and 6 in 10 disabled recipients had a mental disability. The share of SSI recipients who are disabled (rather than elderly) has grown steadily over time; however, the number of people who receive SSI is not generally growing faster than population.
How Is SSI Funded?
As an entitlement program, SSI is available to anyone who meets its eligibility requirements. Unlike Social Security (which is financed by dedicated payroll taxes), SSI is funded from general revenues. At a cost of just over $50 billion in fiscal year 2012, SSI constitutes a small portion of the federal budget -- 1.4 percent of total spending that year. Roughly 93 percent of SSI spending pays for benefits; the rest covers administrative costs.
SSI expenditures were 0.33 percent of gross domestic product (GDP) in 2012 and are expected to decline to 0.23 percent of GDP by 2037.
How Effective Is SSI?
SSI benefits are about three-fourths of the poverty line for a single person and slightly over 80 percent of poverty for a couple. Thus, while SSI alone is not enough to lift someone who lives independently out of poverty, it reduces the number of people in extreme poverty and greatly lessens the burden on other family members.
SSI also is effective in reducing the aggregate poverty gap (the amount of money needed to lift families out of poverty) among SSI recipients. In 2010, SSI reduced their aggregate poverty gap by over two-thirds.
Still, over two-fifths of SSI recipients live below the poverty line even after taking their benefits into account, and many more elderly or disabled persons in need of assistance do not get benefits. Reforming SSI could increase participation and make benefit levels more adequate. Possible reforms include increasing the basic benefit, updating the asset and income limits, and easing restrictions on eligibility for legal immigrants.
For more information, see "Introduction to the Supplemental Security Income (SSI) Program."