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Disability program running out of funds

A government entitlement program is headed for insolvency in four years, and it's not the one members of Congress are talking about most.

The Social Security disability program's trust fund is projected to run out of cash far sooner than the better-known Social Security retirement plan or Medicare. That will trigger a 21 percent cut in benefits to 11 million Americans -- disabled people, their spouses and children -- many of whom rely on the program to stay out of poverty.

"It's really striking how rapidly this is growing, how big it's become and how D.C. is just afraid of it," said Mark Duggan, a University of Pennsylvania economist and adviser to the Social Security Administration.

Part of the reason for the burgeoning costs is that the 77 million baby boomers projected to swamp federal retirement plans will reach the disability program first, because almost all boomers are at least 50, the age at which someone is most likely to become disabled.

The growing costs are also a result of the economy, because when people can't find work and exhaust their jobless benefits, many turn to disability.

Sen. Tom Coburn, R-Okla., said he has tried to interest fellow lawmakers in the issue, so far without much luck.

"Nobody wants to touch things where they can be criticized," Coburn said.

Applications to the disability program have risen more than 30 percent since 2007 -- the last recession started in December of that year -- and the number of Americans receiving disability benefits is up 23 percent.

More Americans receive disability benefits than 20 years ago though they are less likely to have physically demanding jobs. Social Security comprises two separate programs: the retirement plan supporting 40 million senior citizens and 6 million survivors, and the disability insurance program created during the Eisenhower administration to prevent sick and injured workers from becoming destitute.

The disability program currently pays benefits averaging $1,111 a month, with the money coming from the Social Security payroll tax taken out of workers' paychecks.

The program cost $132 billion last year, more than the combined annual budgets of the departments of Agriculture, Homeland Security, Commerce, Labor, Interior and Justice.

That doesn't include an additional $80 billion spent because disability benefici-aries become eligible for Medicare, regardless of their age, after a two-year waiting period.

The disability program, which has been spending more than it receives in revenue for four consecutive years, is projected to exhaust its trust fund in 2016, according to a Social Security trustees report released last month.

By comparison, the separate trust fund financing senior citizens' Social Security benefits is projected to run out in 2035 while Medicare's primary fund will be exhausted in 2024.