GRMF20-02: Interactions Across Various Disability Insurance (DI) Programs

Around disability onset, many individuals experience a decline in welfare, such as a drop in earnings and consumption. Disability insurance (DI) lessens this harm by providing a replacement income. This project studies how individuals with disability use various state-run DI programs with varying features during their working years. For example, an aspect of DI that can be studied is the use of multiple DI benefits and how they complement each other. A potential contribution of this study is the use of a new dataset from the Wisconsin Department of Employee Trust Funds (ETF) which administers multiple DI programs for Wisconsin public employees. This dataset can provide new insights on DI use for a few reasons. First, this project can explore interactions between LTDI programs, which are not well studied. For example, some LTDI programs administered by ETF require their beneficiaries to also apply for SSDI which may affect the size of SSDI enrollment. Second, ETF also administers a short-term disability insurance (STDI). Thus, this paper can examine whether STDI reduces or promotes transition onto LTDI which includes SSDI. This project has three parts. The first is a review of the institutional details of the DI programs. The second part includes descriptive estimates of the characteristics of the DI beneficiaries. The third part is a formal regression analysis on how individuals with a disability use DI during their life course.