The failure to reach a budget agreement will shut down much of the federal government on Wednesday, but that won’t stop the flow of several critical benefits, including Social Security retirement and disability payments, which are sent to more than 74 million people each month.
Applying for benefits will also still be possible, either online, over the phone or at the agency’s field offices, which generally remain open in the event of a budgetary lapse.
“We will continue activities critical to our direct-service operations and those needed to ensure accurate and timely payment of benefits,” according to a recent document from Tom Holland, Social Security’s chief financial officer. The letter described the agency’s contingency plan in the event of a federal shutdown.
Both Social Security and Medicare are not subject to annual budget negotiations by Congress — their funding is mandatory because it has already been authorized by the Social Security Act. (Social Security’s dedicated revenue source is generated largely by payroll taxes, which are split by workers and their employers. Medicare is partly funded by the same revenue stream.)
That means retirement, survivor and disability benefits will continue uninterrupted. Supplemental Security Income, a needs-based program for poor or disabled beneficiaries that is administered by the agency, works a bit differently: It is funded through appropriations made by Congress, but those payments are available through December, experts said.
Still, some of the Social Security Administration’s more general services will be put on hold. They include benefit verification, benefit updates that are unrelated to the adjudication of benefits, corrections to an earnings record and the replacement of Medicare cards, according to the agency’s letter explaining its contingency plans.
If the shutdown drags on, it could delay Social Security’s annual cost-of-living adjustment, or COLA, which adjusts payments for price inflation. That measure is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (called C.P.I.-W), a figure that was set to come out in mid-October. But it is calculated by the Bureau of Labor Statistics, which is expected to suspend operations.
In a politically charged message sent to Social Security employees on Tuesday afternoon, the agency’s commissioner, Frank Bisignano, said that President Trump opposed a government shutdown but that Democrats were blocking efforts to keep it running.
“The agency has contingency plans in place for executing an orderly shutdown of activities that would be affected by any lapse in appropriations forced by congressional Democrats,” he said in the message.
Most of Social Security’s frontline employees will continue to report to work, though, like other essential federal workers, they will not be paid. The agency and its staff have already experienced a lot of tumult this year, which began when the Department of Government Efficiency slashed roughly 12 percent of its work force.
“We have a well-documented morale crisis at Social Security, made worse over the past eight months as we have lost thousands more employees,” said a statement from Social Security Workers United, a committee of the American Federation of Government Employees union that represents 40,000 agency workers. “Delaying our paychecks will make the morale crisis even worse. We are being asked to keep delivering earned benefits while our own financial situations suffer.”
