The Arc Reacts to New Proposals in Budget Negotiations That Could Result in Cuts to Social Security

Washington, DC – The Arc released the following statement in light of reports of new threats to Social Security in negotiations on a budget deal to avert the fiscal cliff.  On the negotiating table is a change to the way benefits are calculated known as the “chained Consumer Price Index (CPI).”

“We are very disappointed by the newest proposals in Washington, DC that would result in a chained CPI. The chained CPI would cut all Social Security benefits, including for individuals receiving Social Security disability benefits and Supplemental Security Income.  Social Security is an essential lifeline for individuals with disabilities, and the chained CPI would cut their benefits and unnecessarily damage their quality of life.  Our nation cannot continue balancing the budget on the backs of individuals with disabilities and must preserve vital supports including Social Security, SSI, Medicaid, and Medicare,” said Marty Ford, Director, Public Policy Office, The Arc.

The chained CPI reduces the cost-of-living adjustment (COLA) that Social Security and Supplemental Security Income (SSI) beneficiaries receive in most years, resulting in people getting smaller benefit increases than they otherwise would under the current calculation.

Cuts from the chained CPI compound and get bigger every year. For the average Social Security Disability Insurance (SSDI) beneficiary, the chained CPI would mean a benefit cut of about $347 per year after 10 years, $720 per year after 20 years, and $1,084 per year after 30 years. After 30 years, the cut is roughly 1 months’ worth of benefits for the average SSDI beneficiary. For SSI, the chained CPI not only lowers the annual COLA but also reduces the initial SSI benefit, which is calculated using a federal benefit rate that adjusts annually for inflation.