Demand for changes in Social Security as people risk losing benefits

Lawmakers and policy experts have offered a number of suggestions for changes to Social Security so that fewer Americans are at risk of losing their benefits.

According to Social Security Administration guidelines, Americans living on Supplemental Security Income could lose their financial and health benefits — and may also receive a notice of overpayment — if the size of their assets or income exceeds a certain level.

Read more: Checking Account vs. Savings Account: Which is Better for You?

Thus, while Americans with disabilities who qualify for SSI may want to enter or re-enter the workforce, they may be afraid to do so because of the potential consequences.

“It penalizes people for working,” Senator Elizabeth Warren said of the current rules during a Senate hearing on Tuesday. “It penalizes people for saving.”

During a Senate Finance Committee hearing, federal and state officials recommended several options that could reform the rules for Social Security disability insurance and help prevent Americans from being denied their benefits when they decide to work or invest in a savings account.

SSI has strict rules for beneficiaries’ income. Single beneficiaries must earn less than $1,913 per month, while married couples cannot earn more than $2,827.

Read more: 10 Best Short-Term Investments

The limit for assets is less than $2,000 for individuals and less than $3,000 for married couples.

Susan Wilske, associate commissioner of the SSA’s Office of Retirement and Disability Policy, said keeping Americans aware of benefits requirements can be a difficult task.

While the office provides benefits counseling, he said they are working with “very limited funding” having been originally set up in 1999.

Read more: CD vs. High-Yield Savings Account

“We need adequate funding and staffing,” Wilschke said during the hearing Tuesday.

If SSA received a larger budget for this type of counseling, fewer Americans would lose their benefits because of inadvertently violating income or asset restrictions.

Other lawmakers and policy experts have suggested overhauling the income and asset rules altogether.

Senator Bob Casey proposed and passed the Achieving a Better Life Experience Act in 2014, which allowed individuals with disabilities to save and invest through tax-exempt accounts without losing access to Medicaid or Social Security benefits.

Casey said about 170,000 of the roughly 4 million SSI recipients have opened an ABLE account, which allows them to save up to $18,000 a year without hitting the asset-limit requirement.

“For too many years, people with disabilities were prevented from saving for the future, which meant they couldn’t save for a home, purchase needed assistive technology or save for an accessible car,” Casey previously said in a statement. “I worked to create the ABLE program to remove those barriers, and ever since I’ve been working to ensure the program is as effective as possible.”

But spreading awareness about the ABLE program and reducing the complexities of the process remains challenging.

During Tuesday’s hearing, Senator Sherrod Brown suggested raising the asset limits through a bill, saying he had heard stories of employees rejecting company-offered 401(k) plans out of fear that they would violate the asset limits.

According to Wilschke, having too much money in assets is the biggest reason for overpayments.

The overpayment notices are often sent years later, requesting the SSA return thousands of dollars after the agency made a mistake in benefit calculations.

Another potential change to SSI is updating the jobs data, which SSA uses to determine which disabilities are significant enough to prevent working.

These bureaucratic issues are ones that Senator Ron Wyden, who chairs the Senate Finance Committee, said he hopes will be resolved after the hearing.

“Despite all the good intentions, I’m leaving here saying we still have to make some changes,” Wyden said. “Now is the time to do that.”