Understanding Participation in SSI by Kathleen McGarry and Robert Schoeni Comments by Barbara Butrica Urban Institute August 7, 2014

1 in 9 Americans ages 65 and older lives in poverty 2

The share of older adults receiving food, housing, or heating benefits matches poverty rates fairly closely 3

Yet, the share receiving SSI benefits is well below poverty rates 4

Why is SSI Participation So Low? Do elderly not participate because of a perceived stigma? Do they not participate because they have other means? This paper contributes to our understanding of SSI participation among older adults. Different from other studies, this paper focuses on the role of family. 5

Authors’ Findings Eligible nonparticipants are somewhat better off than participants—physically and economically. Among SSI eligibles, those with higher income children and those receiving transfers from children are less likely to participate in SSI. 6

Suggestions for Future Research Use qualitative measures of well-being Difficulty paying bills Enough money for food Skip meals (if not enough food) Retirement satisfaction Control for consumption Could focus on basic needs—housing, health care, food, and clothing 7

Suggestions for Future Research Consider the timing of eligibility versus the timing of income sources, for example: Respondents might delay claiming Social Security because they are waiting for their spouse Or some of their income sources may be intermittent Reexamine eligibility criteria The finding that 11% of eligible non-participants receive transfers from children compared with only 6% of participants may indicate that eligibility is mismeasured. Non-participants might not actually be eligible. 8

Implications for Retirement Security Poverty rates of older Americans could be lower if SSI-eligibles were to participate. The results could inform policymakers as to how better to reach low-income elderly. The results could also guide federal and state governments about how SSI participation might change in response to changes in Social Security. 9

Over time, Social Security benefits have increased relative to poverty—not true for SSI 10

SSI prevalence has declined dramatically for adults ages 65 and older—not true for younger people 11

Policy Recommendations Improve education/outreach about SSI benefits. The Strengthen Social Security Coalition suggests notifying Social Security beneficiaries of their potential eligibility for SSI, along with SSI rules on asset holdings. Reform and strengthen SSI program. Increase the asset limit to reflect changes in the cost of living. Increase the maximum benefit to the poverty threshold. Consider Social Security reforms that protect low-income adults. Maintain the relatively high replacement rates for lower earners. Minimum Social Security benefits. Control rising health care costs. 12