Social insurance programs differ from social welfare programs in that they take into account any contributions that the beneficiary has made to the program. These programs may be considered more preventative in nature than the social welfare programs.

4.9.1 Social Security Disability Insurance

Social Security Disability Insurance (SSDI) covers individuals who have worked enough years to qualify for Social Security payments if they become disabled with a condition that “is expected to last at least one year or result in death” (Social Security Administration, 2014, p. 4). Since this is not a public assistance program, applicants do not need to pass a means test. Benefits can also extend to some family members. After receiving SSDI benefits for two years, one automatically becomes eligible for Medicaid benefits as well. (Social Security Administration, 2014).

4.9.2 Medicare

Medicare is a program, funded by tax revenues, which provides financial assistance for medical care for the nation’s elderly, retired, and some people with disabilities as shown in figure 4.21. Much more complex than Medicaid, Medicare’s benefits come in various forms (Part A, Part B, Part C, Part D). Part A (inpatient hospital coverage) is free, with the remaining optional components requiring the payment of a premium. Medicare is addressed in greater depth in Chapter 8.

Figure 4.21. Medicare and Social Security are both programs which benefit older Americans, along with other groups of people.

4.9.3 Social Security

Old Age, Survivors, and Disability Insurance (OASDI) is the formal name for the program we more typically call Social Security. It provides an income to “qualified retired and disabled workers and their dependents and to survivors of insured workers” (Social Security Administration, 2011). Over 50 million Americans receive benefits, including over 85% of those aged 65 or older (Social Security Administration, 2011). Although it was never designed to be the primary source of income for the elderly, it is at least 90% of the income for 22% of married couples and 43% of other individuals 65 or older (Social Security Administration, 2011).

There is some concern about the long-term viability of Social Security due to the increasing average age and life expectancy of Americans, coupled with the trend of companies encouraging older workers to go into early retirement (Baker & Weisbrot, 1999). Some people will see little return on their Social Security tax payments, while others will draw much more out of the system than they put into it. The maximum monthly benefit payable to a retired worker in 2021 is $3,148, but they can only collect that much if they have earned $142,800 or more each year over a 35-year working career. The average retiree’s monthly Social Security payment in 2021 was $1,543/month (Brandon, 2021). Social Security will be discussed more in depth in Chapter 7.

4.9.4 Unemployment Insurance

Unemployment Insurance (UI) is aimed at preventing recently unemployed workers from slipping into economic despair while they search for a new job. There is no means test, and benefits paid out are based on earnings from one’s previous job. The program is funded by tax paid by employers rather than employees (Conrad, 2008). Workers can generally apply only if they’ve been laid off, but in some cases people who have been fired are eligible (Kirst-Ashman, 2013). In order to continue to receive benefits, one must also be actively looking for work and be able to furnish proof of that fact (Stone & Chen, 2014).

Each state runs its UI program quite differently. Payment levels are determined by how much the worker earned while working and what the average income is in that state, and benefits are often capped at around half the worker’s previous earnings (Levitan et al., 1998). During the COVID-19 pandemic, the federal government also provided additional payments beyond state unemployment payouts, adding $300 per week for many people in need (Guerin, 2021).

4.9.5 Workers’ Compensation

Like UI, Worker’s Compensation is meant to help people stay out of poverty during temporary loss of income—in this case, due to an injury or disease sustained on the job. Workers’ Compensation is designed to cover lost wages, medical treatment for the condition, possible rehabilitation, and to compensate one’s family in the event of a workplace-related death (Levitan et al., 1998; Matthews, 2015). However, the total of an individual’s disability benefit payment (if any) and Worker’s Compensation payment cannot exceed more than 80% of his/her working income (Matthews, 2015).

There are many factors that people cannot control that cause them to be unemployed, to file for bankruptcy, to apply for public assistance. It is our job as social workers to know that what our clients really need is not judgment—they need someone to recognize that they are people who have a story and deserve an opportunity to get on their feet, regroup, and keep fighting against a powerfully unequal system.

4.9.7 References

Baker, Dean and Weisbrot, Mark. Social Security: The Phony Crisis, https://press.uchicago.edu/ucp/books/book/chicago/S/bo3632965.html

Biggs, A. G. (2011). Social Security: The story of its past and a vision for its future. AEI Press.

Guerin, L. (2021).Collecting Unemployment benefits in Hawaii. NOLO. https://www.nolo.com/legal-encyclopedia/collecting-unemployment-benefits-hawaii.html.

Levitan, S. A., Mangum, G. L., & Mangum, S. L. (1998). Programs in aid of the poor (7th ed.). The Johns Hopkins University Press.

Matthews, J. (2015). Social Security, Medicare & government pensions: Get the most out of your retirement & medical benefits. Nolo.

Social Security Administration (2011). Social Security (Old-Age, Survivors, and Disability Insurance). http://www.socialsecurity.gov/policy/docs/statcomps/supplement/2011/oasdi.pdf.

Social Security Administration (2014). Social Security Disability benefits. http://www.ssa.gov/pubs/EN-05-10029.pdf.