The Work-Capacity Approach to Disability Determination

Background: In the complex of social welfare programs, disability benefits may be the most challenging to design and administer. In the US, access to federal disability benefits is determined through a medical verification process that awards benefits only to those found incapable of substantial gainful activity.  Research indicates that this dichotomous determination model frequently makes inaccurate determinations on complex cases (Keiser, 2010; Maestas, Mullen and Strand, 2013). The result is a process where many claimants can wait years before receiving needed benefits, as they navigate a complex appeals process (Autor et al., 2011).

This article looks abroad for lessons to improve the disability determination process in the US. A new model of disability determination is considered that has been adopted in certain European countries. This model identifies a claimant’s remaining work-capacities, as opposed to the medical severity of their disabilities, to determine eligibility for disability benefits. This “work-capacity approach” is designed to: (1) reduce subjectivity in the disability determination process by allowing examiners to identify a second group of eligible beneficiaries who maintain some ability to work; (2) provide information, consistent with strengths-based practice in social work, on what claimants can do and how they can be assisted in their return to work; and (3) reduce the number of long-term disability benefit recipients by providing personalized return to work services.

Methods:The article provides a comparative policy analysis of recent reforms to the disability determination processes in Denmark, Great Britain, and the Netherlands. In each of these countries, a work-capacity approach was adopted. Drawing on econometric research and administrative data from the respective countries and the OECD, the article examines whether the above propositions proved true in practice by examining the implementation and effects of the reforms in the three countries.

Results:The analysis suggests that these reforms have been fairly successful at achieving their stated goals but have also encountered several bottlenecks. Three lessons are identified for the US if it were to adopt a work-capacity approach:  (1) the need to invest in the training and professionalization of front line workers, including social workers, who will be asked to administer the new assessment and provide the employment and rehabilitative services; (2) the need to address the environmental barriers to employment that people with disabilities experience as part of the return to work intervention; and (3) the need to have realistic expectations regarding the employability of disability benefit claimants.

Conclusion/Implications: With the projected exhaustion of the Disability Trust Fund supporting the Social Security Disability Insurance program in 2016, policy makers are likely to give increased attention to reforming the disability determination process.  This article identifies practical suggestions from abroad for reforming that process. These lessons, if adopted, have the potential to reduce program expenditures and improve the support system for people with disabilities in the US.