Title: Federal policy and the rise in disability enrollment
Description: "The fraction of non-elderly adults in the U.S.  receiving disability benefits from the federal SSDI and/or SSI programs increased from 3.2 to 5.9 percent during the last two decades.  Determining how much of this increase was caused by changes in policy versus other factors is difficult given that the programs are essentially uniform nationwide.  In this study, we shed light on this issue by investigating the impact of a discrete change in the federal government's third largest disability program, the Department of Veterans Affairs' Disability Compensation (DC) program.  In July of 2001, there was an expansion in the medical eligibility criteria for this program that applied only to Vietnam veterans.  This change was motivated by an Institute of Medicine study, which linked exposure to Agent Orange and other herbicides used by the U.S.  military in Vietnam, to the onset of diabetes.  Using veterans who served shortly before and after the Vietnam War as our comparison group, we estimate that this policy change increased DC enrollment by 6.7 percentage points among Vietnam veterans.  An additional 2.7 percent experienced an increase in their monthly DC benefit as a result of this policy change.  The expanded eligibility criteria for Vietnam veterans can explain 60 percent of the recent acceleration in DC enrollment growth and increased the present value of DC spending by more than $30 billion.  Our results further indicate that the policy change was responsible for an increase in the responsiveness of the program to local economic conditions.  Our findings strongly suggest that even relatively narrow changes in the eligibility criteria for federal disability programs can have a powerful effect on program enrollment and expenditures"--National Bureau of Economic Research web site.