The clock is ticking for House Speaker Kevin McCarthy to find a compromise to keep the federal government running and sidestep a costly shutdown.
The specter of a federal government shutdown, which would begin on October 1 if a solution isn’t found by then, is raising questions for Social Security recipients about how a stoppage might impact their monthly benefit checks. Experts said there’s some good and bad news for the 66 million Americans on Social Security.
Would a government shutdown affect Social Security checks?
First the good news: A shutdown won’t impact Social Security checks, according to Kathleen Romig, director of Social Security and disability policy at the Center on Budget and Policy Priorities, a left-leaning think tank.
“Social Security and [Supplemental Security Income] benefits will be paid without interruption,” Romig told CBS MoneyWatch. Social Security Administration “field offices and phone lines will be open to take applications and help beneficiaries.”
She added, “Generally, applicants and beneficiaries should experience the same service as usual.”
That’s because Social Security is funded through permanent, rather than annual, federal appropriations, which means the checks will still go out.
The Social Security Administration said last month that it will continue with “activities critical to our direct-service operations and those needed to ensure accurate and timely payment of benefits” in case of a shutdown.
Would a government shutdown affect Social Security services?
Now for the bad news: Yes, some services might be impacted by a shutdown, although recipients will continue to receive payments even if other government agencies close. That’s because about 15% of the Social Security Administration’s staff would be furloughed if there’s a government shutdown, Romig noted.
“A few customer service activities will be suspended, such as benefit verifications and replacement Medicare cards, but SSA is allowed to keep on staff that ensure the payment of Social Security and SSI benefits” because the checks are guaranteed by law, she explained.
Another trouble spot could be state disability determination services, which make medical decisions on whether people applying for Social Security disability payments qualify for them, Romig said.
The Social Security Administration “urges states to continue their work during a shutdown, but the decision lies with state governments and in the past some have closed,” she noted.
Because there are already huge backlogs in disability decisions, a government shutdown could worsen delays, Romig said.
How is this different from the debt ceiling crisis earlier this year?
Earlier this year, the U.S. was facing a funding crisis as President Biden and Republican lawmakers were at loggerheads over whether to raise or suspend the nation’s debt limit.
While that crisis was ultimately averted, the nation at the time was close to reaching the so-called “X date,” the fiscal limit when the U.S. would run out of money to pay its bills unless Congress raised or suspended the nation’s debt ceiling. If the U.S. had crossed that point, the Treasury Department would have defaulted on its obligations, something that has never before happened.
Under that scenario, a default could have affected Social Security recipients by delaying their checks.
However, the current crisis is about appropriations bills that must be passed by Congress and signed by the president ahead of the start of the new fiscal year on October 1. If the funding deadline passes without new authorization from Congress, the government must fully or partially shutdown, depending on the funding to each agency.