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| Actuarial Publications |
Summary of Provisions That Would Change the Social Security Program |
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Description of Proposed Provisions:
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Estimates based on the intermediate assumptions of the 2016 Trustees Report
| Printer-friendly Version (PDF) |
| Change from present 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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| Present law shortfall in long-range actuarial balance is 2.66 percent of payroll and in annual balance for the 75th year is 4.35 percent of payroll. | ||||||
| B1.1 |
Price indexing of PIA factors beginning with those newly eligible for OASDI
benefits in 2023: 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) |
2.77 | 7.79 | 104% | 179% | |
| B1.2 |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2023: 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) |
1.50 | 4.25 | 56% | 98% | |
| B1.3 |
Progressive price indexing (40th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2023: 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) |
1.25 | 3.53 | 47% | 81% | |
| B1.4 |
Progressive price indexing (50th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2023: 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 | 2.64 | 38% | 61% | |
| B1.5 |
Progressive price indexing (60th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2023: 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) |
0.71 | 1.68 | 27% | 39% | |
| B1.6 (2020) |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2020: 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) |
1.51 | 3.96 | 57% | 91% | |
| B1.6 (2025) |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2025: 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) |
1.19 | 3.63 | 45% | 84% | |
| B1.7 |
Progressive price indexing (40th percentile) of PIA factors for individuals newly
eligible for OASI benefits in 2024 through 2061: 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) |
0.99 | 2.55 | 37% | 59% | |
| B1.8 |
Progressive price indexing (50th percentile) of PIA factors for individuals newly
eligible for OASI benefits in 2021 through 2060: 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) |
0.97 | 2.27 | 36% | 52% | |
| B2.1 |
Beginning with those newly eligible for OASI benefits in 2026, multiply the PIA factors
by the ratio of life expectancy at 67 for 2021 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) |
0.53 | 1.68 | 20% | 39% | |
| B3.1 |
Beginning with those newly eligible for OASDI benefits in 2017, multiply the 32 and 15
percent PIA factors each year by 0.987. Stop reductions after 2047, when the factors
reach 21 percent and 10 percent, respectively.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
1.53 | 2.92 | 57% | 67% | |
| B3.2 |
Beginning with those newly eligible for OASI benefits in 2024, multiply the 90 and 32
percent PIA factors each year by 0.9925 and 0.982, respectively. Stop reductions after
2061. Beginning with those newly eligible for OASI benefits in 2019, multiply the 15
factor by 0.982. Stop reduction of the 15 factor after 2056. 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) |
2.04 | 5.20 | 77% | 120% | |
| B3.3 |
Beginning with those newly eligible for OASDI benefits in 2017, use a modified primary
insurance amount (PIA) formula. The modified formula: (1) increases the first bend point
to the equivalent of $800 in 2009; (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) |
0.20 | 0.27 | 8% | 6% | |
| B3.4 |
Beginning with those newly eligible for OASDI benefits in 2020, multiply all PIA factors
each year by 0.991. Stop reductions after 2048. 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) |
1.51 | 3.11 | 57% | 72% | |
| B3.5 |
Progressive indexing (30th percentile) of PIA factors beginning with individuals newly
eligible for OASI benefits in 2019, continuing through 2056, and resuming in 2077: 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 1.21 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) |
1.31 | 3.06 | 49% | 70% | |
| B3.6 |
Progressive indexing (30th percentile) of PIA factors beginning with individuals newly
eligible for OASI benefits in 2019, continuing through 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 1.21 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) |
1.40 | 3.51 | 53% | 81% | |
| B3.7 |
Progressive indexing (30th percentile) of PIA factors beginning with individuals newly
eligible for OASI benefits in 2019, continuing through 2028, and resuming in 2067:
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 1.21 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 | 1.58 | 23% | 36% | |
| B3.8 |
Beginning with those newly eligible for OASDI benefits in 2023, 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 2056: 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) |
0.91 | 2.23 | 34% | 51% | |
| B3.9 |
Beginning with those newly eligible for OASDI benefits in 2029, gradually reduce the 15 percent
PIA factor in each year so that it reaches 10 percent for those newly eligible in 2058 and later.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center 2010) |
0.08 | 0.22 | 3% | 5% | |
| B3.10 |
Beginning with those newly eligible for OASDI benefits in 2023, gradually increase the first
PIA bend point in each year so that it is 15 percent higher for those newly eligible in 2037
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 | -14% | -16% | |
| B3.11 |
Increase the first PIA factor from 90 percent to 93 percent for all beneficiaries eligible
as of January 2018 and for those newly eligible for benefits after 2018.
graph | table | pdf-graph | pdf-table | memo (Larson 2015) | memo (Larson 2014) |
-0.24 | -0.26 | -9% | -6% | |
| B3.12 |
Use an annualized "mini-PIA" formula beginning with retired workers newly
eligible in 2023. 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 2023, 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 2027. 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) |
0.23 | 0.38 | 9% | 9% | |
| B3.13 |
For retired worker beneficiaries newly eligible in 2023 (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 $826 in 2015 to $1,050 in 2015. Phase this provision in over 10 years
(2023-2032). The phase-in would work on a weighted-average basis: 90% of CL formula
+ 10% of proposal formula for 2023, 80% of CL formula + 20% of proposal formula for
2024, and so on.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center October 2016) | memo (Bipartisan Policy Center June 2016) |
0.04 | 0.10 | 2% | 2% | |
| B3.14 |
Beginning with those newly eligible for OASDI benefits in 2018, reduce the 15 percent
PIA factor by 2 percentage points per year so that it reaches 5 percent for those
newly eligible in 2022 and later.
graph | table | pdf-graph | pdf-table | memo (Ribble) |
0.30 | 0.44 | 11% | 10% | |
| B3.15 |
Increase the 90 percent PIA formula factor to 91 percent for beneficiaries
newly eligible in 2021, 92 percent for those newly eligible in 2022, ...,
reaching 95 percent for those newly eligible in 2025 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 2023 or later, phase in a new benefit formula (from
2023 to 2032). 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 2032.
graph | table | pdf-graph | pdf-table | memo (Johnson 2016) |
0.85 | 1.53 | 32% | 35% | |
| 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 2017-2021.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.28 | 0.39 | 10% | 9% | |
| 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 2017-2025.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) | memo (Social Security Advisory Board) |
0.44 | 0.65 | 17% | 15% | |
| 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 2018-2026.
graph | table | pdf-graph | pdf-table | memo (Warshawsky) |
0.60 | 0.92 | 22% | 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 2018 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 2018, to 3 for workers newly eligible in
2019, and to 2 for workers newly eligible in 2020 and later.
graph | table | pdf-graph | pdf-table | memo (Ribble) |
0.37 | 0.52 | 14% | 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 2034, and is phased in for new eligibles
in 2025 through 2033. 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 | -1% | 0% | |
| B5.2 |
Beginning for those newly eligible in 2017, 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 $1,226 in
2015). For those with under 30 years of coverage, the PIA per year of coverage
over 10 years is $1,226/20 = $61.30. (c) Index the initial PIA per year of
coverage by wage growth for successive cohorts.
graph | table | pdf-graph | pdf-table | memo (Sanders, DeFazio) | memo (Sanders 2016) | memo (Sanders 2015) | memo (Larson 2015) | memo (Larson 2014) | memo (National Academy of Social Insurance) |
-0.14 | -0.21 | -5% | -5% | |
| B5.3 |
Beginning for those newly eligible in 2017, 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 $1,226 in 2015). For those with
under 30 years of coverage, the PIA per year of coverage over 10 years is
$1,226/20 = $61.30. (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 | -0.31 | -8% | -7% | |
| B5.4 |
Beginning for those newly eligible in 2023, 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 $1,226 in
2015). For those with under 30 years of coverage, the PIA per year of coverage
over 10 years is $1,226/20 = $61.30. (c) From 2015 to the year of implementation,
2023, 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% | -5% | |
| B5.5 |
Beginning for those newly eligible in 2018, 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 $1,260 in 2015). For
those with under 30 years of coverage, the PIA per year of coverage over 19
years is $1,260/11 = $114.50. (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) |
-0.06 | -0.09 | -2% | -2% | |
| B5.6 |
Beginning for those newly eligible in 2017, 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 $990 in 2016). For those with under 30 years
of coverage, the PIA per year of coverage over 10 years is $990/20 = $49.50. (c)
From 2016 to the year of implementation, 2017, 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 | -0.15 | -4% | -3% | |
| B5.7 |
Beginning for those newly eligible in 2019, 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 2021, 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) |
-0.19 | -0.24 | -7% | -5% | |
| B5.9 |
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 40 years of coverage equal to 125 percent of
the monthly Aged Federal poverty level (about $1,184 in 2015). 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 2018 and 2019, index the applicable poverty level using
the CPI index, to the year prior to eligibility. Then, for newly eligible workers in
2020 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 2023 through 2032: (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) |
-0.23 | -0.41 | -9% | -10% | |
| 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 2017 or who reaches
their 85th birthday after the beginning of 2017.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) | memo (National Academy of Social Insurance) |
-0.11 | -0.15 | -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 2017 or who reaches
their 85th birthday after the beginning of 2017. 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 | -0.15 | -4% | -4% | |
| B6.3 |
Provide an increase in the benefit level of any beneficiary who is 85 or
older at the beginning of 2018 or who reaches their 85th birthday after
the beginning of 2018. Increase the beneficiary's PIA based on an amount
equal to the average retired-worker PIA at the end of 2017, 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 2018 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) |
-0.13 | -0.19 | -5% | -4% | |
| B6.4 |
Starting in 2017, 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) |
-0.15 | -0.21 | -6% | -5% | |
| B6.5 |
Starting in 2019, 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 | -9% | -7% | |
| B6.6 |
Starting in 2023, 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 2023 (over age 76 for retirees), phase in the PIA
enhancement over 10 years starting in 2023. 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 2023, 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 $25,000 if single
and $50,000 if married. MAGI is set to equal the IRMAA definition (AGI plus
tax-exempt interest income). Index these thresholds after 2023 by the increase
in the C-CPI-U; (2) The full additional amount is applicable for those born
1957 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
1957, 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 | -0.07 | -3% | -2% | |
| B7.1 |
Reduce benefits by 3 percent for those newly eligible for benefits in 2017 and later.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.37 | 0.50 | 14% | 12% | |
| B7.2 |
Reduce benefits by 5 percent for those newly eligible for benefits in 2017 and later.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.61 | 0.84 | 23% | 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 $23,865 in 2015). The credits are available for all past years
to newly eligible retired-worker and disabled-worker beneficiaries starting in
2017. The 5 years are chosen to yield the largest increase in AIME.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-0.23 | -0.32 | -9% | -7% | |
| B7.4 |
Increase benefits by 2 percent for all beneficiaries as of the beginning of
2017 and for those newly eligible for benefits after the beginning of 2017.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-0.31 | -0.33 | -12% | -8% | |
| B7.5 |
Increase benefits by 5 percent for all beneficiaries as of the beginning of
2017 and for those newly eligible for benefits after the beginning of 2017.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-0.77 | -0.83 | -29% | -19% | |
| B7.6 |
Increase benefits by 20 percent for all beneficiaries as of the beginning of
2017 and for those newly eligible for benefits after the beginning of 2017.
graph | table | pdf-graph | pdf-table | memo (National Academy of Social Insurance) |
-3.07 | -3.33 | -116% | -77% | |
| 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 2021 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 2021, based on changes in the SSA average wage index.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) |
0.31 | 0.43 | 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 2023.
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 2023, 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 2023 to through 2032. 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 | 0.05 | 1% | 1% | |
| B7.11 |
Beginning in January 2019, 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 2016) |
0.01 | 0.12 | 0% | 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 attaining
age 62 in 2023 and later. Widows are held harmless from the lump-sum decision.
graph | table | pdf-graph | pdf-table | memo (Johnson 2016) |
0.00 | 0.00 | 0% | 0% | |
 |
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