Description of Proposed Provisions:
Provisions Affecting Level of Monthly Benefits
Estimates based on the intermediate assumptions of
the 2017 Trustees Report
Printer-friendly Version (PDF)
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Change from current law [percent of payroll] |
Shortfall eliminated | |||||
|---|---|---|---|---|---|---|
|
Long-range actuarial balance |
Annual balance in 75th year |
Long-range actuarial balance |
Annual balance in 75th year |
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| Current law shortfall in long-range actuarial balance is 2.83 percent of payroll and in annual balance for the 75th year is 4.48 percent of payroll. | ||||||
| B1.1 |
Price indexing of PIA factors beginning with those newly eligible for OASDI
benefits in 2024: Reduce factors so that initial benefits grow by inflation
rather than by the SSA average wage index.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
2.65 | 7.68 | 94% | 171% | |
| B1.2 |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2024: Create a new bend
point at the 30th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 30th percentile and below.
Reduce the 32 and 15 percent factors above the 30th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
1.46 | 4.26 | 52% | 95% | |
| B1.3 |
Progressive price indexing (40th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2024: Create a new bend
point at the 40th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 40th percentile and below.
Reduce the 32 and 15 percent factors above the 40th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
1.23 | 3.58 | 44% | 80% | |
| B1.4 |
Progressive price indexing (50th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2024: Create a new bend
point at the 50th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 50th percentile and below.
Reduce the 32 and 15 percent factors above the 50th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
1.00 | 2.72 | 35% | 61% | |
| B1.5 |
Progressive price indexing (60th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2024: Create a new bend
point at the 60th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 60th percentile and below.
Reduce the 32 and 15 percent factors above the 60th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.72 | 1.76 | 26% | 39% | |
| B1.6 (2021) |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2021: Create a new bend
point at the 30th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 30th percentile and below.
Reduce the 32 and 15 percent factors above the 30th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index. Disabled workers
are: (a) not affected prior to normal retirement age; and (b) subject to a
proportional reduction in benefits, based on the worker's years of disability,
upon conversion to retired-worker beneficiary status. Young survivors (children
of deceased workers and surviving spouses with a child in care) are not affected.
graph | table | pdf-graph | pdf-table | memo (Bennett) |
1.47 | 3.96 | 52% | 88% | |
| B1.6 (2026) |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2026: Create a new bend
point at the 30th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 30th percentile and below.
Reduce the 32 and 15 percent factors above the 30th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index. Disabled workers
are: (a) not affected prior to normal retirement age; and (b) subject to a
proportional reduction in benefits, based on the worker's years of disability,
upon conversion to retired-worker beneficiary status.
graph | table | pdf-graph | pdf-table | memo (Ryan 2010) |
1.18 | 3.66 | 42% | 82% | |
| B1.7 |
Progressive price indexing (40th percentile) of PIA factors for individuals
newly eligible for OASI benefits in 2025 through 2062: Create a new bend
point at the 40th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 40th percentile and below.
Reduce the 32 and 15 percent factors above the 40th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index. Disabled workers
are: (a) not affected prior to normal retirement age; and (b) subject to a
proportional reduction in benefits, based on the worker's years of disability,
upon conversion to retired-worker beneficiary status. Young survivors (children
of deceased workers and surviving spouses with a child in care) are not affected.
graph | table | pdf-graph | pdf-table | memo (Graham, Paul, Lee) |
0.98 | 2.56 | 35% | 57% | |
| B1.8 |
Progressive price indexing (50th percentile) of PIA factors for individuals
newly eligible for OASI benefits in 2022 through 2061: Create a new bend
point at the 50th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 50th percentile and below.
Reduce the 32 and 15 percent factors above the 50th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index. Disabled workers
are: (a) not affected prior to normal retirement age; and (b) subject to a
proportional reduction in benefits, based on the worker's years of disability,
upon conversion to retired-worker beneficiary status.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) |
0.96 | 2.29 | 34% | 51% | |
| B2.1 |
Beginning with those newly eligible for OASI benefits in 2027, multiply the
PIA factors by the ratio of life expectancy at 67 for 2022 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 as computed by SSA's Office
of the Chief Actuary, are used to determine the ratio. Disabled workers are:
(a) not affected prior to normal retirement age; and (b) subject to a proportional
reduction in benefits, based on the worker's years of disability, upon conversion
to retired-worker beneficiary status.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center 2010) | memo (Bennett) |
0.52 | 1.68 | 18% | 37% | |
| B3.1 |
Beginning with those newly eligible for OASDI benefits in 2018, multiply the 32
and 15 percent PIA factors each year by 0.987. Stop reductions after 2048, when
the factors reach 21 percent and 10 percent, respectively.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
1.54 | 2.96 | 54% | 66% | |
| B3.2 |
Beginning with those newly eligible for OASI benefits in 2025, multiply the
90 and 32 percent PIA factors each year by 0.9925 and 0.982, respectively.
Stop reductions after 2062. Beginning with those newly eligible for OASI
benefits in 2020, multiply the 15 factor by 0.982. Stop reduction of the 15
factor after 2057. Disabled workers are: (a) not affected prior to normal
retirement age; and (b) subject to a proportional reduction in benefits,
based on the worker's years of disability, upon conversion to retired-worker
beneficiary status. Child beneficiaries and spouses with a child in care
under the OASI program are not affected by this proposal.
graph | table | pdf-graph | pdf-table | memo (Liebman, MacGuineas, Samwick) |
2.05 | 5.26 | 72% | 117% | |
| B3.3 |
Beginning with those newly eligible for OASDI benefits in 2018, use a modified
primary insurance amount (PIA) formula. The modified formula: (1) increases the
first bend point to the equivalent of $800 in 2009 (about $952 in 2017); (2)
places a new bend point 75 percent of the way between the reset first bend point
and the current-law second bend point; (3) lowers the PIA factor between the new
bend point and the upper bend point from 32 percent to 20 percent; and (4) lowers
the factor above the upper bend point from 15 percent to 10 percent.
graph | table | pdf-graph | pdf-table | memo (AARP) |
0.22 | 0.29 | 8% | 7% | |
| B3.4 |
Beginning with those newly eligible for OASDI benefits in 2021, multiply all
PIA factors each year by 0.991. Stop reductions after 2049. Disabled workers
are: (a) not affected prior to normal retirement age; and (b) subject to a
proportional reduction in benefits, based on the worker's years of disability,
upon conversion to retired-worker beneficiary status. Young survivors (children
of deceased workers and surviving spouses with a child in care) are not affected.
graph | table | pdf-graph | pdf-table | memo (Warshawsky) |
1.50 | 3.15 | 53% | 70% | |
| B3.5 |
Progressive indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2020, continuing through
2057, and resuming in 2078: Create a new bend point at the 30th percentile
of the AIME distribution of newly retired workers. Maintain current-law
benefits for earners at the 30th percentile and below. Reduce the 32 and
15 percent factors above the 30th percentile such that the initial benefit
for a worker with AIME equal to the taxable maximum is reduced by 1.20
percent per year as compared to current law (for the years that progressive
indexing applies). Disabled workers are: (a) not affected prior to normal
retirement age; and (b) subject to a proportional reduction in benefits,
based on the worker's years of disability, upon conversion to retired-worker
beneficiary status.
graph | table | pdf-graph | pdf-table | memo (NRC/NAPA) |
1.33 | 3.11 | 47% | 69% | |
| B3.6 |
Progressive indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2020, continuing through
2069: Create a new bend point at the 30th percentile of the AIME
distribution of newly retired workers. Maintain current-law benefits for
earners at the 30th percentile and below. Reduce the 32 and 15 percent
factors above the 30th percentile such that the initial benefit for a worker
with AIME equal to the taxable maximum is reduced by 1.20 percent per year
as compared to current law (for the years that progressive indexing applies).
Disabled workers are: (a) not affected prior to normal retirement age; and
(b) subject to a proportional reduction in benefits, based on the worker's
years of disability, upon conversion to retired-worker beneficiary status.
graph | table | pdf-graph | pdf-table | memo (NRC/NAPA) |
1.41 | 3.57 | 50% | 80% | |
| B3.7 |
Progressive indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2020, continuing through
2029, and resuming in 2068: Create a new bend point at the 30th percentile
of the AIME distribution of newly retired workers. Maintain current-law
benefits for earners at the 30th percentile and below. Reduce the 32 and
15 percent factors above the 30th percentile such that the initial benefit
for a worker with AIME equal to the taxable maximum is reduced by 1.20 percent
per year as compared to current law (for the years that progressive indexing
applies). Disabled workers are: (a) not affected prior to normal retirement
age; and (b) subject to a proportional reduction in benefits, based on the
worker's years of disability, upon conversion to retired-worker beneficiary
status.
graph | table | pdf-graph | pdf-table | memo (NRC/NAPA) |
0.61 | 1.60 | 22% | 36% | |
| B3.8 |
Beginning with those newly eligible for OASDI benefits in 2024, create a new
bend point at the 50th percentile of the AIME distribution of newly retired
workers and gradually reduce all PIA factors except for the 90 percent factor.
By 2057: a) the 32 percent PIA factor below the new bend point reduces to 30
percent; b) the 32 percent PIA factor above the new bend point reduces to 10
percent; and c) the 15 percent PIA factor reduces to 5 percent.
graph | table | pdf-graph | pdf-table | memo (Fiscal Commission) |
0.93 | 2.30 | 33% | 51% | |
| B3.9 |
Beginning with those newly eligible for OASDI benefits in 2030, gradually
reduce the 15 percent PIA factor in each year so that it reaches 10 percent
for those newly eligible in 2059 and later.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center 2010) |
0.08 | 0.23 | 3% | 5% | |
| B3.10 |
Beginning with those newly eligible for OASDI benefits in 2024, gradually
increase the first PIA bend point in each year so that it is 15 percent
higher for those newly eligible in 2038 and later.
graph | table | pdf-graph | pdf-table | memo (Sanders, DeFazio) | memo (Sanchez) | memo (Sanders 2016) | memo (Schatz) | memo (Sanders 2015) | memo (Harkin 2013) | memo (Harkin 2012) |
-0.37 | -0.71 | -13% | -16% | |
| B3.11 |
Increase the first PIA factor from 90 percent to 93 percent for all
beneficiaries eligible as of January 2019 and for those newly eligible
for benefits after 2018.
graph | table | pdf-graph | pdf-table | memo (Larson 2017) | memo (Larson 2015) | memo (Larson 2014) |
-0.24 | -0.26 | -8% | -6% | |
| B3.12 |
Use an annualized "mini-PIA" formula beginning with retired workers newly
eligible in 2024. For each indexed earnings year, compute an individual
AIME and an individual PIA. Sum these individual PIAs for the 40 highest
years of indexed earnings and divide that total amount by 37 to get the
PIA for this provision. Phase-in over five years, meaning that in 2024,
80 percent of the benefit would be based on the old 35-year average PIA
formula and 20 percent on the new mini-PIA formula, shifting by 20 percentage
points each year until 100 percent is based on the new mini-PIA formula
for those attaining age 62 in 2028. Disabled worker benefits are unchanged
under this provision.
graph | table | pdf-graph | pdf-table | memo (Johnson 2016) | memo (Bipartisan Policy Center October 2016) | memo (Bipartisan Policy Center June 2016) |
0.25 | 0.40 | 9% | 9% | |
| B3.13 |
For retired worker beneficiaries newly eligible in 2024 (excluding disabled
workers), add a new bend point at the wage-indexed equivalent of the 50th
percentile of the AIME distribution minus $100 (for 2015 eligibility) and
change the PIA factors to 95/32/15/5. Also move the current-law first bend
point from the wage-indexed equivalent of $885 in 2017 to $1,125 in 2017.
Phase this provision in over 10 years (2024-2033). The phase-in would work
on a weighted-average basis: 90% of CL formula + 10% of proposal formula for
2024, 80% of CL formula + 20% of proposal formula for 2025, and so on.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center October 2016) | memo (Bipartisan Policy Center June 2016) |
0.07 | 0.14 | 2% | 3% | |
| B3.14 |
Beginning with those newly eligible for OASDI benefits in 2019, reduce the
15 percent PIA factor by 2 percentage points per year so that it reaches 5
percent for those newly eligible in 2023 and later.
graph | table | pdf-graph | pdf-table | memo (Ribble) |
0.32 | 0.47 | 11% | 10% | |
| B3.15 |
Increase the 90 percent PIA formula factor to 91 percent for beneficiaries
newly eligible in 2022, 92 percent for those newly eligible in 2023, ...,
reaching 95 percent for those newly eligible in 2026 and later.
graph | table | pdf-graph | pdf-table | memo (Sanchez) |
-0.28 | -0.44 | -10% | -10% | |
| B3.16 |
For retired worker and disabled worker beneficiaries becoming initially
eligible in January 2024 or later, phase in a new benefit formula (from
2024 to 2033). Replace the existing two primary insurance amount (PIA)
bend points with three new bend points as follows: (1) 25% AWI/12 from
2 years prior to initial eligibility; (2) 100% AWI/12 from 2 years prior
to initial eligibility; and (3) 125% AWI/12 from 2 years prior to initial
eligibility. The new PIA factors are 95%, 27.5%, 5% and 2%. During the
phase in, those becoming newly eligible for benefits will receive an
increasing portion of their benefits based on the new formula, reaching
100% of the new formula in 2033.
graph | table | pdf-graph | pdf-table | memo (Johnson 2016) |
0.89 | 1.60 | 31% | 36% | |
| B4.1 |
Increase the number of years used to calculate benefits for retirees
and survivors (but not for disabled workers) from 35 to 38, phased in
over the years 2018-2022.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.27 | 0.38 | 10% | 8% | |
| B4.2 |
Increase the number of years used to calculate benefits for retirees
and survivors (but not for disabled workers) from 35 to 40, phased in
over the years 2018-2026.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) | memo (Social Security Advisory Board) |
0.44 | 0.64 | 15% | 14% | |
| B4.3 |
For the OASI and DI computation of the PIA, gradually reduce the maximum
number of drop-out years from 5 to 0, phased in over the years 2019-2027.
graph | table | pdf-graph | pdf-table | memo (Warshawsky) |
0.60 | 0.92 | 21% | 21% | |
| B4.4 |
Reduce the number of computation years (increase dropout years) for parents
having a child in care under the age of 6. The parent must have no earnings
(covered or non-covered) for the year to be eligible for the credit. Only
one parent can claim the childcare added dropout year for a given earnings
year. Each parent can earn at most 2 dropout years per child, and a maximum
of 5 dropout years in total. The years designated as childcare years do not
have to be the years that could otherwise be included in the computation of
the average indexed monthly earnings (AIME). The provision would be effective
for all benefits payable for entitlement in January 2019 and later (without
regard for when the beneficiary became initially eligible).
graph | table | pdf-graph | pdf-table | memo (Murphy) |
-0.05 | -0.05 | -2% | -1% | |
| B4.5 |
For retired and disabled workers, reduce the maximum number of dropout
years to 4 for workers newly eligible in 2019, to 3 for workers newly
eligible in 2020, and to 2 for workers newly eligible in 2021 and later.
graph | table | pdf-graph | pdf-table | memo (Ribble) |
0.36 | 0.52 | 13% | 12% | |
| B5.1 |
Increase the PIA to a level such that a worker with 30 years of earnings
at the minimum wage level receives an adjusted PIA equal to 120 percent
of the Federal poverty level for an aged individual. This provision takes
full effect for all newly eligible OASDI workers in 2035, and is phased
in for new eligibles in 2026 through 2034. The percentage increase in PIA
is 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 is 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.
graph | table | pdf-graph | pdf-table | memo (Ryan 2010) |
-0.01 | -0.00 | -0% | -0% | |
| B5.2 |
Beginning for those newly eligible in 2018, reconfigure the special
minimum benefit: (a) A year of coverage is defined as a year in which
4 quarters of coverage are earned. (b) At implementation, set the
PIA for 30 years of coverage equal to 125 percent of the monthly
poverty level (about $1,238 in 2016). For those with under 30 years
of coverage, the PIA per year of coverage over 10 years is $1,238/20
= $61.90. (c) Index the initial PIA per year of coverage by wage
growth for successive cohorts.
graph | table | pdf-graph | pdf-table | memo (Lawson) | memo (Larson 2017) | memo (Sanders, DeFazio) | memo (Sanders 2016) | memo (Sanders 2015) | memo (Larson 2015) | memo (Larson 2014) | memo (National Academy of Social Insurance) |
-0.15 | -0.22 | -5% | -5% | |
| B5.3 |
Beginning for those newly eligible in 2018, reconfigure the special
minimum benefit: (a) A year of coverage is defined to be either a
year in which 4 quarters of coverage are earned or a child is in care.
Childcare years are granted to parents who have a child under 5,
with a limit of 8 such years. (b) At implementation, set the PIA for
30 years of coverage equal to 125 percent of the monthly poverty level
(about $1,238 in 2016). For those with under 30 years of coverage,
the PIA per year of coverage over 10 years is $1,238/20 = $61.90.
(c) Index the initial PIA per year of coverage by wage growth for
successive cohorts.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-0.22 | -0.32 | -8% | -7% | |
| B5.4 |
Beginning for those newly eligible in 2024, reconfigure the special
minimum benefit: (a) A year of coverage is defined as a year in which
4 quarters of coverage are earned. (b) At implementation, set the PIA
for 30 years of coverage equal to 125 percent of the monthly poverty
level (about $1,238 in 2016). For those with under 30 years of coverage,
the PIA per year of coverage over 10 years is $1,238/20 = $61.90. (c)
From 2016 to the year of implementation, 2024, index the PIA per year
of coverage using the chain-CPI index. Then, for later years, index
the PIA per year of coverage by wage growth for successive cohorts.
(d) Scale work requirements for disabled workers, based on the number
of years of non-disabled potential work.
graph | table | pdf-graph | pdf-table | memo (Fiscal Commission) |
-0.12 | -0.20 | -4% | -4% | |
| B5.5 |
Beginning for those newly eligible in 2019, reconfigure the special
minimum benefit: (a) A year of coverage is defined as a year in which
either 20 percent of the "old law maximum" is earned or a child is
in care. Childcare years are granted to parents who have a child under
6, with a limit of 8 such years. (b) At implementation, set the PIA
for 30 years of coverage equal to 133 percent of the Census monthly
poverty level (about $1,276 in 2016). For those with under 30 years
of coverage, the PIA per year of coverage over 19 years is $1,276/11
= $116.00. (c) Index the initial PIA per year of coverage by wage
growth for successive cohorts. (d) Scale work requirements for disabled
workers, based on the number of years of non-disabled potential work.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center 2010) |
-0.05 | -0.08 | -2% | -2% | |
| B5.6 |
Beginning for those newly eligible in 2018, reconfigure the special minimum
benefit: (a) A year of coverage is defined to be either a year in which 4
quarters of coverage are earned or a child is in care. Childcare years are
granted to parents who have a child under 6, with a limit of 5 such years.
(b) At implementation, set the PIA for 30 years of coverage equal to 100
percent of the monthly poverty level (about $1,005 in 2017). For those with
under 30 years of coverage, the PIA per year of coverage over 10 years is
$1,005/20 = $50.25. (c) From 2017 to the year of implementation, 2018, index
the PIA per year of coverage using the CPI index. Then, for later years,
index the PIA per year of coverage by wage growth for successive cohorts.
(d) Scale work requirements for disabled workers, based on the number of
years of non-disabled potential work.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) |
-0.10 | -0.16 | -4% | -3% | |
| B5.7 |
Beginning for those newly eligible in 2020, reconfigure the special minimum
benefit: (a) The number of years of work (YOWs) is determined as total quarters
of coverage divided by 4, ignoring any fraction. Childcare years are granted
to parents who have a child under 6, with a limit of 5 such years. (b) At
implementation, set the PIA for 30+ YOWs equal to 100 percent of the monthly
HHS poverty level for the year prior to eligibility. For workers between 11
and 29 YOWs, reduce the special minimum by 3 1/3 percentage points per YOW so
that at 29 YOWs the minimum would be 96 2/3% of poverty, ..., down to 11 YOWs
at 36 2/3% of poverty. No minimum for 10 or fewer YOWs.
graph | table | pdf-graph | pdf-table | memo (Moore) |
-0.02 | -0.00 | -1% | -0% | |
| B5.8 |
Beginning in 2022, create a Basic Minimum Benefit (BMB) within Social Security
(i.e., the cost of the BMB would be charged as a cost to the OASI Trust Fund),
with the following specifications: (1) Eligibility for the BMB would be limited
to OASI beneficiaries who have attained normal retirement age (NRA) or above.
OASI beneficiaries under NRA would not be eligible for the BMB. (2) The BMB would
be calculated on a household basis and split equally between members of the household.
In the case of a married couple, both spouses would need to claim any Social Security
benefits for which they are eligible before they could receive the BMB. If both
spouses have claimed and one is NRA or above and the other has not yet attained
NRA, only the half of the BMB for the spouse over NRA would be payable. (3) The
BMB amount for single beneficiaries would be equal to either: 1) the BMB base
($604 in 2015) - 0.70 * current monthly OASI benefit (not including any BMB),
if positive; or 2) zero. (4) The BMB amount for married beneficiaries would be
equal to either: 1) the BMB base ($906 in 2015) - 0.70 * total household monthly
OASI benefits (not including any BMB), if positive; or 2) zero. (5) The BMB bases
for singles and couples would be updated annually for changes in the average wage
index (AWI). (6) Single filers with Adjusted Gross Income (AGI) over $30,000 and
joint filers with AGI (including taxable SS benefits) over $45,000 would be subject
to clawback of the BMB through the income tax system. Any BMB would be reduced by
one dollar for every dollar of income above the thresholds. (Thresholds, in 2015
dollars, would be indexed to chained CPI-U.) Clawbacks would be credited back to
the OASI Trust Fund.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center October 2016) | memo (Bipartisan Policy Center June 2016) |
-0.20 | -0.24 | -7% | -5% | |
| B5.9 |
Beginning for those newly eligible in 2019, reconfigure the special minimum
benefit: (a) A year of coverage is defined as a year in which 4 quarters of
coverage are earned. (b) At implementation, set the PIA for 40 years of coverage
equal to 125 percent of the monthly Aged Federal poverty level (about $1,200
in 2016). For those with 20 or fewer years of coverage, phase up linearly
from 0 percent of the poverty level for 10 years of coverage to 100 percent
of the poverty level. For those having between 20 and 40 years of coverage,
phase up linearly from 100 percent of the poverty level at 20 years of coverage
to 125% of the poverty level for 40 or more years of coverage. (c) For newly
eligible workers in 2019 and 2020, index the applicable poverty level using
the CPI index, to the year prior to eligibility. Then, for newly eligible
workers in 2021 and later, index the PIA per year of coverage by wage growth
for successive cohorts. (d) Disabled workers have a somewhat similar minimum
benefit, with work requirements scaled based on the number of years of non-disabled
potential work. Disabled workers have a somewhat similar minimum benefit amount.
graph | table | pdf-graph | pdf-table | memo (Ribble) |
-0.14 | -0.24 | -5% | -5% | |
| B5.10 |
Reconfigure the special minimum benefit, phased in for retired and disabled
workers newly eligible from 2024 through 2033: (a) A year of work (YOW) coverage
is equal to earnings at or above $10,875 in 2017 (reflecting a full-time worker
earning the federal minimum wage), adjusted thereafter for wage growth.
(b) At implementation, set the minimum PIA at zero percent of AWI for those
with 10 or fewer YOWs to 15 percent of AWI for those with 15 YOWs, increasing
linearly so that it reaches 19 percent for 19 YOWs. Then the minimum PIA
would jump up to 25 percent of AWI for those with 20 YOWs, increasing linearly
so that it equals 35 percent of AWI for those with 35 or more YOWs. (c) Use
the AWI for two years prior to the year of initial eligibility in the minimum
PIA calculation with COLA increase after the year of initial eligibility. (d)
Scale the YOW requirements for disabled workers, based on the number of years
of non-disabled potential work.
graph | table | pdf-graph | pdf-table | memo (Johnson 2016) |
-0.22 | -0.40 | -8% | -9% | |
| B6.1 |
Provide a 5 percent increase to the monthly benefit amount (MBA) of any
beneficiary who is 85 or older at the beginning of 2018 or who reaches
their 85th birthday after the beginning of 2018.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) | memo (National Academy of Social Insurance) |
-0.11 | -0.16 | -4% | -4% | |
| B6.2 |
Provide the same dollar amount increase to the monthly benefit amount (MBA)
of any beneficiary who is 85 or older at the beginning of 2018 or who reaches
their 85th birthday after the beginning of 2018. The dollar amount of increase
equals 5 percent of the average retired-worker MBA in the prior year.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-0.11 | -0.16 | -4% | -3% | |
| B6.3 |
Provide an increase in the benefit level of any beneficiary who is 85
or older at the beginning of 2019 or who reaches their 85th birthday
after the beginning of 2019. Increase the beneficiary's PIA based on
an amount equal to the average retired-worker PIA at the end of 2018,
or at the end of the year age 80 if later. Increase the beneficiary's
PIA by 5 percent of this amount for those older than 85 at the beginning
of 2019 and by 5 percent of this amount at age 85 for others, phased
in at 1 percent per year for ages 81-85.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center 2010) |
-0.14 | -0.19 | -5% | -4% | |
| B6.4 |
Starting in 2018, provide a 5 percent uniform benefit increase 24 years
after initial benefit eligibility. Phase in the benefit increase at 1
percent per year from the 20th through 24th years after eligibility. For
disabled workers, the eligibility age is the initial entitlement year to
the benefit. The benefit increase is equal to 5 percent of the PIA of a
worker assumed to have career-average earnings equal to SSA's average wage
index.
graph | table | pdf-graph | pdf-table | memo (Ribble) | memo (Fiscal Commission) |
-0.16 | -0.21 | -5% | -5% | |
| B6.5 |
Starting in 2020, provide a 5 percent uniform PIA increase 20 years
after benefit eligibility. Phase in the PIA increase at 1 percent
per year from the 16th through 20th years after eligibility. The full
PIA increase is equal to 5 percent of the PIA of a worker assumed to
have career-average earnings equal to the SSA average wage index.
graph | table | pdf-graph | pdf-table | memo (Moore) |
-0.24 | -0.31 | -8% | -7% | |
| B6.6 |
Starting in 2024, provide a uniform PIA increase 23 years after benefit
eligibility. Phase in the PIA increase at 0.5 percent per year from the
14th through the 23rd years after eligibility. The full PIA increase is
equal to 5 percent of the average retired worker PIA in December of the
12th year after benefit eligibility. A similar additional PIA increase
applies 42 years after benefit eligibility (age 104), phased in from the
33rd through the 42nd years after eligibility. For those past the 14th
year of eligibility in 2024 (over age 76 for retirees), phase in the PIA
enhancement over 10 years starting in 2024. Auxiliary beneficiaries receive
benefit enhancement based on the PIA of the governing worker.
graph | table | pdf-graph | pdf-table | memo (FY 2014 Budget) |
-0.21 | -0.30 | -8% | -7% | |
| B6.7 |
Starting in January 2024, provide an addition to monthly benefits for all
beneficiaries who have been eligible for at least 20 years, with the following
specifications: (1) Augment benefits (not the PIA) for those of qualifying
age and eligibility duration with a MAGI below about $25,600 if single and
$51,200 if married. MAGI is set to equal the IRMAA definition (AGI plus tax-exempt
interest income). Index these thresholds after 2024 by the increase in the
C-CPI-U; (2) The full additional amount is applicable for those born 1958
and later, once 24 years elapse from initial eligibility. The basic additional
amount is calculated as 5 percent of the PIA for a hypothetical worker with
earnings equal to the AWI each year; (3) For those born prior to 1958, the
full additional amount is multiplied by the number of years they have been
affected by the C-CPI-U, divided by 24; (4) Beneficiaries will receive 20
percent of their additional amount in their 20th year after initial eligibility,
40 percent in their 21st year after initial eligibility,..., and 100 percent
of their additional amount in their 24th and later years after benefit eligibility;
(5) Retired and disabled worker beneficiaries, dually entitled spouse beneficiaries,
and all survivor beneficiaries received their addition as described above.
Spousal beneficiaries (aged or with child in care) and child beneficiaries
of a living retired or disabled worker receive 50 percent of the additional
amount described above. Other beneficiary types (such as parents of deceased
workers) will receive the percentage of the flat benefit that equals the
percentage of the insured worker's PIA that they receive; (6) The AWI used
is for the second year prior to the beneficiary's initial eligibility year,
with applicable COLAs applied up to the age when the addition is received;
and (7) The additional amount is added to the monthly benefit after reductions
for early claiming or increases for delayed claiming have been applied.
graph | table | pdf-graph | pdf-table | memo (Johnson 2016) |
-0.07 | -0.08 | -2% | -2% | |
| B7.1 |
Reduce benefits by 3 percent for those newly eligible for benefits in 2018 and later.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.37 | 0.51 | 13% | 11% | |
| B7.2 |
Reduce benefits by 5 percent for those newly eligible for benefits in 2018 and later.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.61 | 0.84 | 22% | 19% | |
| B7.3 |
Give credit to parents with a child under 6 for earnings for up to
five years. The earnings credited for a childcare year equal one half
of the SSA average wage index (about $24,682 in 2016). The credits
are available for all past years to newly eligible retired-worker and
disabled-worker beneficiaries starting in 2018. The 5 years are chosen
to yield the largest increase in AIME.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-0.22 | -0.32 | -8% | -7% | |
| B7.4 |
Increase benefits by 2 percent for all beneficiaries as of the beginning of
2018 and for those newly eligible for benefits after the beginning of 2018.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-0.31 | -0.34 | -11% | -7% | |
| B7.5 |
Increase benefits by 5 percent for all beneficiaries as of the beginning of
2018 and for those newly eligible for benefits after the beginning of 2018.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-0.78 | -0.84 | -27% | -19% | |
| B7.6 |
Increase benefits by 20 percent for all beneficiaries as of the beginning of
2018 and for those newly eligible for benefits after the beginning of 2018.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-3.10 | -3.36 | -110% | -75% | |
| B7.7 |
Reduce individual Social Security benefits if modified adjusted gross
income, or MAGI (AGI less taxable Social Security benefits plus nontaxable
interest income) is above $60,000 for single taxpayers or $120,000 for
taxpayers filing jointly. This provision is effective for individuals
newly eligible for benefits in 2022 or later. The percentage reduction
increases linearly up to 50 percent for single/joint filers with MAGI
of $180,000/$360,000 or above. Index the MAGI thresholds for years after
2022, based on changes in the SSA average wage index.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) |
0.34 | 0.47 | 12% | 10% | |
| B7.8 |
Replace the Windfall Elimination Provision (WEP) and Government Pension
Offset (GPO) with a revised reduction for most OASI benefits based on
all earnings, beginning with beneficiaries newly eligible in 2024.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center October 2016) | memo (Bipartisan Policy Center June 2016) |
0.06 | 0.09 | 2% | 2% | |
| B7.9 |
Beginning for newly eligible retired workers and spouses in 2024, all
claimants who are married would receive a specified joint-and-survivor
annuity benefit (i.e., surviving spouses would receive 75 percent of
the decedents' benefits, in addition to their own) that would be payable
if both were still alive. Initial benefits would be actuarially adjusted
to keep the expected value of benefits equivalent to what would otherwise
be current law.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center October 2016) | memo (Bipartisan Policy Center June 2016) |
0.02 | -0.21 | 1% | -5% | |
| B7.10 |
Replace the current-law WEP with a new calculation for most OASI and DI
benefits based on covered and non-covered earnings, phased in for beneficiaries
becoming newly eligible in 2024 through 2033. For this new approach, compute
a PIA based on all past earnings (covered and non-covered), and multiply
by the "non-covered earnings ratio." This ratio is equal to the current-law
concept of the average indexed monthly earnings computed without non-covered
earnings divided by a modified average indexed monthly earnings that includes
both covered and non-covered earnings in our records.
graph | table | pdf-graph | pdf-table | memo (Johnson 2016) |
0.03 | 0.06 | 1% | 1% | |
| B7.11 |
Beginning in January 2020, eliminate the retirement earnings test for
all beneficiaries under normal retirement age, including retired workers,
aged spouses, aged widow(er)s, young spouses with a child in care, young
surviving spouses with a child in care, and children.
graph | table | pdf-graph | pdf-table | memo (Johnson, Walorski) | memo (Johnson 2016) |
0.02 | 0.13 | 1% | 3% | |
| B7.12 |
Provide an option to split the 8-percent delayed retirement credit (DRC)
to offer a lump sum benefit at initial entitlement equal to 2 percent of
the 8 percent DRC earned, and a 6 percent DRC on subsequent monthly benefits,
effective for workers newly entitled to retired worker benefits in 2020
and later. Widows are held harmless from the lump-sum decision.
graph | table | pdf-graph | pdf-table | memo (Johnson, Smith) | memo (Johnson 2016) |
-0.00 | 0.00 | -0% | 0% | |