How Social Security depends on the mail
Top Democrats are warning that the problems afflicting the U.S. Postal Service pose a threat to more than voting rights — a slowdown in services, they say, will also hurt seniors who rely on letter carriers for Social Security checks, medications and other critical mail.
Already, concerns about prescription drug deliveries are surfacing — but how about Social Security payments? Should beneficiaries be concerned?
Accounts of mail slowdowns and curtailed service emerged after Louis DeJoy, a Republican megadonor and ally of President Donald Trump, became postmaster general in May. DeJoy has pushed changes he says will help the Postal Service grow and “embark on a path of sustainability.”
Over the past two decades, the Social Security Administration has shifted to electronic payment for most beneficiaries, but that doesn’t mean the agency’s operations are not vulnerable to delays in mail service.
The agency currently pays 99% of Social Security beneficiaries via direct deposit to a checking or savings account, or a governmentissued debit card. But nearly 850,000 paper checks still are mailed each month to recipients of retirement, disability and Supplemental Security Income benefits. Social Security also sends and receives millions of pieces of mail every year, including notifications, requests for information, Medicare enrollment forms and replacement Social Security cards. More isolated, rural parts of the country are particularly vulnerable to problems within the postal system.
Moreover, the shutdown since March of Social Security’s national network of field offices because of the pandemic means that more business is being transacted through the Postal Service that normally would be handled through in-person visits.
Here are some key points to know about Social Security and the mail.
The shift to online payments
The federal government has required electronic payment to most beneficiaries since 2013, although there are some exceptions, and it is possible to apply for a waiver. Today, just 1% of Social Security and Supplemental
Security Income beneficiaries receive paper checks, said Darren Lutz, an agency spokesman.
Anyone with a checking account can set up direct deposit, and roughly 94% of beneficiaries use this option. The other choice is Direct Express, a Mastercard prepaid debit card offered through the Treasury Department. The card can be used to make purchases, get cash or set up automatic monthly bill payments. Although there are no sign-up or monthly account fees, free ATM cash withdrawals are limited to one per month — fees are applied for additional withdrawals.
The shrinking paper statement
Social Security has mailed annual statements to workers in various age groups who are eligible for a benefit since the mid-1990s.
The statements provide projections of their benefits at various claiming ages, along with reminders on the availability of disability benefits and Medicare enrollment information.
Those mailings were reduced sharply in recent years to cut costs — and the Social Security Administration has encouraged workers to instead open online accounts, where statements can be downloaded at any time and other business can be conducted with the agency.
Currently, Social Security sends paper statements only to about 15 million workers annually, who are age 60 and older, have not yet claimed benefits and have not opened an online account, Lutz said.
As of July, more than 51.5 million Americans had set up accounts, and 28 million of those have viewed their online statement since October 2018, he said. Those figures point to a sharp drop from the 155 million paper statements that were mailed in 2010 before the cuts; consumer advocates and researchers argue the savings don’t outweigh the lost value of a statement in the mailbox, which builds awareness about Social Security benefits and claiming options. The shift to digital statements is part of a broader Social Security strategy to shift as much of its interaction as possible to the internet.
You’ve still got mail
The Social Security Administration is a large user of the Postal Service. In fact, the ties between the two agencies go all the way back to the start of Social Security, according to Nancy Altman, the author of four books about the program’s history and policies and a leading progressive advocate.
When President Franklin Roosevelt signed Social Security into law in 1935, federal officials creating the new system needed to sign up more than 26 million workers, and had just 17 months to get the job done. Their solution: post office letter carriers not only delivered Social Security applications, but helped people fill out forms, answered questions about the program, returned the forms to offices where Social Security cards were created — and then got the cards to workers.
The entire job took just three weeks, according to Altman, who writes about the feat in her book “The Battle for Social Security: From FDR’s Vision to Bush’s Gamble.”
“President Roosevelt knew that the post office was an essential, trusted institution, that relying on it was the way to ensure that Social Security would have a successful launch,” Altman said. “Today, Americans highly value both institutions.”
Nowadays, Social Security sends 350 million pieces of mail annually to support its programs, according to an agency report last year.
One letter of special interest to beneficiaries is the notice of the annual cost-of-living adjustment, typically mailed in the late fall. By law, Social Security benefits are adjusted each year using a formula tied to the Consumer Price Index. The percentage increase is announced publicly in October, but the letter informs beneficiaries of the monthly dollar increase they will receive, taking into account any increase in the Medicare Part B premium, which typically is deducted from Social Security benefits.
The pandemic makes the USPS more important than ever to Social Security’s operations, says Stacy Braverman Cloyd, director of policy and administrative advocacy for the National Organization of Social Security Claimants’ Representatives, a specialized bar association for lawyers and advocates who represent people claiming Social Security disability and Supplemental Security Income.
“To the extent the Postal Service becomes less reliable, or people have less confidence in it, those are real problems, and they couldn’t happen at a worse time.”