Appendix K to the report of the 1983 Greenspan Commission on Social Security Reform
Appendix K- Section A.
A. COVERAGE
Present law. OASDI coverage now applies to almost all types of employment. The principal types of employment not covered are the following: (1) employees of nonprofit organizations which have not elected such coverage (about 15% of such employees), (2) permanent civilian employees of the Federal government, and (3) employees of State and local governments which have not elected coverage (about 30% of such employees).
Options.
A-1 Extend coverage to all Federal employees, State and local employees' and employees of nonprofit organizations*, effective in 1984.*** Such organizations which have religious principles against any form of government insurance would be permitted to opt out on a permanent basis.
** If the effective date were later than 1984, the long-term cost effect would be about the same as shown. The short-term cost effects would be zero, of course, for years before the effective date and about the same as shown for the effective year and thereafter.
Costs (in billions of dollars) |
||||||||
Estimate |
1983 |
1984 |
1985 |
1986 |
1987 |
1988 |
1989 |
1983-89 |
II-B, OASDI |
0 |
-14.0 |
-16.7 |
-18.0 |
-19.3 |
-20.6 |
-22.0 |
-110.5 |
| III, OASDI | 0 |
-14.2 |
-17.0 |
-18.7 |
-20.5 |
-22.4 |
-24.4 |
-117.2 |
| II-B, HI | 0 |
-1.6 |
-2.0 |
-2.3 |
-2.5 |
-2.7 |
-2.9 |
-14.2 |
| III, HI | 0 |
-1.6 |
-2.0 |
-2.4 |
-2.6 |
-2.8 |
-3.1 |
-14.5 |
25-Year Cost, OASDI: -.70% of taxable payroll
50-Year Cost, OASDI: -.64% of taxable payroll
Long-Term Cost, OASDI: -.53% of taxable payroll
25-Year Cost, HI: -.25% of taxable payroll
A-2 Extend coverage to all Federal employees and all employees of nonprofit organizations*, effective in 1984.**
Costs (in billions of dollars) |
||||||||
Estimate |
1983 |
1984 |
1985 |
1986 |
1987 |
1988 |
1989 |
1983-89 |
II-B, OASDI |
0 |
-8.1 |
-9.2 |
-9.9 |
-10.7 |
-11.4 |
-12.2 |
-61.5 |
| III, OASDI | 0 |
-8.4 |
-9.8 |
-10.7 |
-11.8 |
-12.9 |
-14.1 |
-67.6 |
| II-B, HI | 0 |
-.2 |
-.3 |
-.3 |
-.3 |
-.3 |
-.4 |
-1.8 |
| III, HI | 0 |
-.2 |
-.3 |
-.3 |
-.3 |
-.4 |
-.4 |
-1.9 |
25-Year Cost, OASDI: -.40% of taxable payroll
50-Year Cost, OASDI: -.37% of taxable payroll
Long-Term Cost, OASDI: -.31% of taxable payroll
25-Year Cost, HI: -.02% of taxable payroll
A-3 Extend coverage to all employees of nonprofit organizations* and all new Federal employees, effective in 1984.**
Costs (in billions of dollars) |
||||||||
Estimate |
1983 |
1984 |
1985 |
1986 |
1987 |
1988 |
1989 |
1983-89 |
II-B, OASDI |
0 |
-1.2 |
-2.1 |
-2.7 |
-3.4 |
-4.2 |
-5.0 |
-18.6 |
| III, OASDI | 0 |
-1.2 |
-2.2 |
-2.9 |
-3.7 |
-4.7 |
-5.8 |
-20.6 |
| II-B, HI | 0 |
-.2 |
-.3 |
-.3 |
-.3 |
-.3 |
-.4 |
-1.8 |
| III, HI | 0 |
-.2 |
-.3 |
-.3 |
-.3 |
-.4 |
-.4 |
-1.9 |
25-Year Cost, OASDI: -.25% of taxable payroll
50-Year Cost, OASDI: -.34% of taxable payroll
Long-Term Cost, OASDI: -.30% of taxable payroll
25-Year Cost, HI: -.02% of taxable payroll
A-4 Extend coverage to all new State and local employees, effective 1984.**
Costs (in billions of dollars) |
||||||||
Estimate |
1983 |
1984 |
1985 |
1986 |
1987 |
1988 |
1989 |
1983-89 |
II-B, OASDI |
0 |
-.3 |
-1.1 |
-1.8 |
-2.6 |
-3.3 |
-4.2 |
-13.3 |
| III, OASDI | 0 |
-.3 |
-1.0 |
-1.8 |
-2.6 |
-3.5 |
-4.5 |
-13.7 |
| II-B, HI | 0 |
-.1 |
-.2 |
-.5 |
-.7 |
-.9 |
-1.1 |
-3.5 |
| III, HI | 0 |
-.1 |
-.2 |
-.5 |
-.7 |
-.9 |
-1.1 |
-3.5 |
25-Year Cost, OASDI: -.23% of taxable payroll
50-Year Cost, OASDI: -.28% of taxable payroll
Long-Term Cost, OASDI: -.24% of taxable payroll
25-Year Cost, HI: -.23% of taxable payroll
A-5 Prohibit opting out of coverage of employees of State and local governments and employees of nonprofit organizations by not permitting withdrawal notices to be filed after 1983.
Costs (in billions of dollars)*** |
||||||||
Estimate |
1983 |
1984 |
1985 |
1986 |
1987 |
1988 |
1989 |
1983-89 |
II-B, OASDI |
0 |
+.5 |
+4.0 |
+9.6 |
+11.2 |
+12.1 |
+13.1 |
+50.5 |
| III, OASDI | 0 |
+.5 |
+4.0 |
+9.8 |
+11.6 |
+12.6 |
+14.1 |
+52.6 |
*** It is estimated that such a provision would result in increased costs over the short run, because the actuarial cost estimates assume that many more entries would feel constrained to withdraw at once, before they would no longer have the opportunity to do so. Long-term cost data are not available, due to the diverse effects possible.
A-6 Prohibit opting out of coverage of employees of State and local governments and employees of nonprofit organizations by providing that any notice of termination filed after September 30, 1982 is invalid.****
A-7 Eliminate "windfall" old-age and disability benefits for persons with pensions from noncovered employment, effective for those becoming first eligible after 1983 (in the absence of changes which would result in universal coverage being applicable).
Costs (in billions of dollars)*** |
||||||||
Estimate |
1983 |
1984 |
1985 |
1986 |
1987 |
1988 |
1989 |
1983-89 |
II-B |
0 |
-.0 |
-.0 |
-.0 |
-.0 |
-.1 |
-.1 |
-.2 |
III |
0 |
-.0 |
-.0 |
-.0 |
-.0 |
-.1 |
-.1 |
-.2 |
25-Year Cost: -.00% of taxable payroll
50-Year Cost: -.03% of taxable payroll
Long-Term Cost: -.09% of taxable payroll
A-8 Extend coverage to all employees of nonprofit organizations*, to all new Federal employees, and to all present Federal employees with less than 5 years of services as of January 1, 1984.
Costs (in billions of dollars)*** |
||||||||
Estimate |
1983 |
1984 |
1985 |
1986 |
1987 |
1988 |
1989 |
1983-89 |
II-B |
0 |
2.4 |
3.2 |
4.0 |
4.7 |
5.5 |
6.3 |
26.2 |
III |
0 |
2.5 |
3.5 |
4.3 |
5.3 |
6.2 |
7.3 |
29.0 |
25-Year Cost: -.25'% of taxable payroll
50-Year Cost: -.36% of taxable payroll
Long-Term cost: -.31% of taxable payroll
*** Cost estimates for the savings involved are not available, because the actuarial cost estimates for the present program assume that no withdrawals will occur. Obviously, this proposal will have significant cost savings if it is enacted.