Health Care

#594 - Chile's Answer to Rising U.S. Disability Costs

Americans are living longer and are healthier than previous generations, yet the number of workers receiving disability benefits is increasing. In fact, disability is the fastest-rising component of Social Security — growing at nearly twice the rate of spending on retirement benefits.

This phenomenon — improving health but increasing benefit claims — is occurring in many developed countries. Chile , however, has reversed this trend and curtailed its disability costs. In a new NCPA study, " Integrated Disability and Retirement Systems in Chile ," former World Bank economist Estelle James concludes that the United States and other developed countries could reduce their disability costs and the number of disabled workers by adopting features of Chile 's system.