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Provisions Affecting Level of Monthly Benefits

These provisions modify the formula used for calculating the basic Social Security monthly benefit called the Primary Insurance Amount (PIA). For the provisions listed below, we provide estimates of the financial effect on the OASDI program over the long-range period (the next 75 years) and for the 75th year. In addition, we provide detailed single year tables.

All estimates are based on the intermediate assumptions described in the 2008 Trustees Report. Choose the type of estimates (summary or detailed) from the list of provisions.

Number Table and graph selection
B1 Increase the number of years used to calculate benefits for retirees and survivors (but not for disabled workers) from 35 to 38, phased in 2009-2013.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B2 Increase the number of years used to calculate benefits for retirees and survivors (but not for disabled workers) from 35 to 40, phased in 2009-2017.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B3 For each year from 2009-2039, multiply the 32 and 15 percent formula factors by 0.987, reducing the factors to 21 percent and 10 percent respectively, for new eligibles in 2039 and later.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B4 Reduce benefits by 3 percent for those newly eligible for benefits in 2009 and later.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B5 Reduce benefits by 5 percent for those newly eligible for benefits in 2009 and later.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B6 Beginning with those newly eligible for OASDI benefits in 2015 and later, reduce PIA formula factors so that benefits grow by inflation rather than by increases in real wages.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B7 Progressive price indexing of PIA formula factors beginning with individuals newly eligible for OASDI benefits in 2015. Create new bend point at the 30th percentile of earners. Maintain current-law benefits for earners at the 30th percentile and below and reduce upper 2 formula factors (32% and 15%) such that maximum worker benefit grows by inflation rather than the growth in average wages.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B8 Progressive price indexing of PIA formula factors beginning with individuals newly eligible for OASDI benefits in 2015. Create new bend point at the 40th percentile of earners. Maintain current-law benefits for earners at the 40th percentile and below and reduce upper 2 formula factors (32% and 15%) such that maximum worker benefit grows by inflation rather than the growth in average wages.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B9 Progressive price indexing of PIA formula factors beginning with individuals newly eligible for OASDI benefits in 2015. Create new bend point at the 50th percentile of earners. Maintain current-law benefits for earners at the 50th percentile and below and reduce upper 2 formula factors (32% and 15%) such that maximum worker benefit grows by inflation rather than the growth in average wages.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B10 Progressive price indexing of PIA formula factors beginning with individuals newly eligible for OASDI benefits in 2015. Create new bend point at the 60th percentile of earners. Maintain current-law benefits for earners at the 60th percentile and below and reduce upper 2 formula factors (32% and 15%) such that maximum worker benefit grows by inflation rather than the growth in average wages.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B11 Beginning with those newly eligible in 2016, multiply the 90 and 32 PIA factors each year by 0.9925 and 0.982, respectively. Stop reductions in 2053. Beginning with those newly eligible in 2011, multiply the 15 factor by 0.982. Stop reduction of the 15 factor in 2048. DI will have present law scheduled benefit and proportional reduction at conversion to retired worker benefits at normal retirement age, based on years of disability.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum
B12 Progressive price indexing of PIA formula factors beginning with individuals newly eligible for OASI benefits in 2015. Create new bend point at the 30th percentile of earners. Maintain current-law benefits for earners at the 30th percentile and below and reduce upper 2 formula factors (32% and 15%) such that maximum worker benefit grows by inflation rather than the growth in average wages. Disability benefits are not affected by the proposal. Disabled worker beneficiaries, upon attaining normal retirement age, would be subject to a proportional reduction in benefits based on the worker's years of disability.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum
B12.1 Progressive price indexing of PIA formula factors beginning with individuals newly eligible for OASI benefits in 2012. Create new bend point at the 30th percentile of earners. Maintain current-law benefits for earners at the 30th percentile and below and reduce upper 2 formula factors (32% and 15%) such that maximum worker benefit grows by inflation rather than the growth in average wages. Disability benefits are not affected by the proposal. Disabled worker beneficiaries, upon attaining normal retirement age, would be subject to a proportional reduction in benefits based on the worker's years of disability. In addition, the reduction to the upper 2 formula factors is suspended for any year in which sustainable solvency over the next 75 years is expected. With this provision taken alone, suspension is not expected within the next 75 years.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum
B13 For OASI beneficiaries becoming eligible for benefits in 2021 and later, multiply the PIA factors by the ratio of life expectancy at 67 for 2016 to the life expectancy at age 67 for the 4th year prior to the year of benefit eligibility. Unisex life expectancies, based on period life tables, would be used as projected by SSA's Office of the Chief Actuary. Disability benefits are not affected by the proposal. Disabled worker beneficiaries, upon attaining normal retirement age, would be subject to a proportional reduction in benefits based on the worker's years of disability.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum
B13.1 For OASI beneficiaries becoming eligible for benefits in 2018 and later, multiply the PIA factors by the ratio of life expectancy at 67 for 2013 to the life expectancy at age 67 for the 4th year prior to the year of benefit eligibility. Unisex life expectancies, based on period life tables, would be used as projected by SSA's Office of the Chief Actuary. Disability benefits are not affected by the proposal. Disabled worker beneficiaries, upon attaining normal retirement age, would be subject to a proportional reduction in benefits based on the worker's years of disability.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum
B14 Progressive price indexing of PIA formula factors beginning with individuals newly eligible for OASI benefits in 2016. Create new bend point at the 30th percentile of earners. Maintain current-law benefits for earners at the 30th percentile and below and reduce upper 2 formula factors (32% and 15%) such that maximum worker benefit grows by inflation rather than the growth in average wages. Disability benefits are not affected by the proposal. Disabled worker beneficiaries, upon attaining normal retirement age, would be subject to a proportional reduction in benefits based on the worker's years of disability.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum
B15 Increase the PIA to a level such that a worker with 30 years of earnings at the minimum wage level would receive an adjusted PIA equal to 120 percent of the Federal poverty level for an aged individual. This provision would take full effect for all newly eligible OASDI workers in 2025, and would be phased in for new eligible in 2016 through 2024. The percentage increase in PIA would be lowered proportionately for those with fewer than 30 years of earnings, down to no enhancement for workers with 20 or fewer years of earnings. (Year-of-work requirements are "scaled" for disabled workers based on their years of potential work from age 22 to benefit eligibility). The benefit enhancement percentage would be reduced proportionately for workers with higher average indexed monthly earnings (AIME), down to no enhancement for those with AIME at least twice that of a 35-year steady minimum wage earner.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum
B16 For all individuals becoming eligible for OASDI benefits in 2009 and later, use a modified primary insurance amount (PIA) formula. The modified formula would increase the first bend point to $800 in 2009. Also, a new bend point would be placed between the reset first bend point and the current-law second bend point. The new bend point would be equal to the reset first bend point plus 75 percent of the difference between the bend points. The PIA formula factor between the new bend point and the upper bend point would be lowered from 32% to 20%. The PIA formula factor above the upper bend point would be lowered from 15% to 10%.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
B17 Eliminate dropout years for OASI and DI computation of primary insurance amount (PIA) for individuals newly eligible for benefits from 2010 to 2018. Specifically, for OASDI benefit computation, reduce the maximum number of drop-out years from 5 for benefit eligibility in 2009, with a decrease of 1 computation year in 2010, 2012, 2014, 2016, and 2018.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum
B18 Multiply all PIA formula factors successively by 0.991 for new benefit eligibility in each year 2012 through 2040. Disabled workers and young survivors (surviving spouses with a child-in-care and survivor children) would not be affected by this provision. Upon conversion from disabled worker to retired worker benefits, benefit levels would be proportionally reduced based on the fraction of years the individual was not disabled between ages 22 and 62.
Summary measures and graphs   (PDF version)
Detailed single year tables   (PDF version)
Related memorandum

Above provisions
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Last reviewed or modified May 12, 2009