H.R. 8884, Removing Barriers to Work for Disabled Americans Act

Bill Summary

H.R. 8884 would reauthorize the Social Security Administration (SSA) to conduct demonstration projects for the Disability Insurance (DI) program through calendar year 2031. SSA could not initiate projects after calendar year 2030. The authorization to conduct demonstration projects expired at the end of calendar year 2021.

Section 234 of the Social Security Act allows SSA to test changes that encourage disabled beneficiaries to return to work. Through demonstration projects, SSA can temporarily change program rules, including eligibility criteria and benefit formulas, to determine how those changes affect participants’ work activity and DI benefit amounts.

Estimated Federal Cost

The estimated budgetary effects of H.R. 8884 are shown in Table 1. The costs of the legislation fall within budget function 650 (Social Security).

Basis of Estimate

For this estimate, CBO assumes that H.R. 8884 will be enacted in 2026 and that the estimated amounts will be appropriated each year. CBO assumes an effective date of January 1, 2027, as specified in the bill. Estimates are mainly based on CBO’s analysis of historical outlays for DI demonstration projects from 2016-2021.

Direct Spending

H.R. 8884 would increase direct spending by temporarily allowing SSA to change how DI benefit amounts are calculated for participants in demonstration projects. CBO expects that SSA would pay increased DI benefits because participants could work more while remaining eligible for the program. Using information on the benefit effects of previous demonstration projects, CBO expects that enacting the bill would increase direct spending for DI benefits by $8 million over the 2026-2036 period. Spending from the Disability Insurance Trust Fund is classified as off-budget.

Spending Subject to Appropriation

H.R. 8884 would require that the administrative costs of demonstration projects be paid from SSA’s annual appropriation. Those costs would be attributable to staffing, research, program setup, evaluation, and reporting. Based on historical outlays to administer demonstration projects, CBO expects that implementing H.R. 8884 would cost $62 million over the 2026-2031 period. Any spending would be subject to the availability of appropriated funds.

Uncertainty

CBO’s estimate of H.R. 8884 is subject to uncertainty. The bill would give SSA the authority to design and conduct any number of demonstration projects during the reauthorization period. The number, size, and scope of projects that the agency would conduct under the bill are uncertain. Therefore, the cost of administering the demonstration projects could be higher or lower than estimated. Additionally, the changes to participants’ DI benefits would be based on the design of each demonstration project, so the benefit costs associated with the projects could also be higher or lower than estimated.

Pay-As-You-Go Considerations

Enacting the bill would not affect on-budget direct spending or revenues; therefore, pay-as-you-go procedures do not apply.

Increase in Long-Term Net Direct Spending and Deficits

CBO estimates that enacting H.R. 8884 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2037.

Mandates

CBO has not reviewed H.R. 8884 for intergovernmental or private-sector mandates. Section 4 of the Unfunded Mandates Reform Act excludes from the application of that law legislative provisions related to the Old-Age, Survivors, and Disability Insurance program under title II of the Social Security Act (including taxes imposed by sections 3101(a) and 311(a) of the Internal Revenue Code of 1986). CBO has determined that H.R. 8884 falls within that exclusion because it concerns the DI program.

Estimate Prepared By

Federal Costs: Delaney Smith

Mandates: Andrew Laughlin

Estimate Reviewed By

Elizabeth Cove Delisle
Chief, Income Security Cost Estimates Unit

Kathleen FitzGerald 
Chief, Public and Private Mandates Unit

Christina Hawley Anthony
Deputy Director of Budget Analysis

Estimate Approved By