How Social Security Cuts Could Impact Benefit Payments

Social Security has become a hot topic in recent weeks as the Trump administration continues its overhaul of the federal agency responsible for paying benefits to tens of millions of people every month.

In February, the federal government's Office of Personnel Management advised federal government agencies, including the Social Security Administration (SSA), to submit "reorganization plans" by March 13 and prepare for "reductions in force." The SSA has also announced a number of changes to its operations, including the closure of field offices and internal departments.

The changes have sparked concerns about the future of benefit payments, as prominent former workers at the SSA and lawmakers warn that the system, which paid out $1.5 trillion in benefits in 2024, could collapse without the staff to make it function.

"Ultimately, you're going to see the system collapse and an interruption of benefits," Martin O'Malley, former SSA commissioner in the Biden administration, said last week. "I believe you will see that within the next 30 to 90 days."

Newsweek has contacted the SSA for comment via email.

What Is Happening At The SSA?

Under acting Commissioner Lee Dudek, a former senior adviser to the Office of Program Integrity, the SSA has announced it plans to cut 7,000 staff members, bringing total staffing numbers to about 50,000. The agency also plans to close field offices that help with customer services across multiple states.

It comes after President Donald Trump signed directives allowing the new Department of Government Efficiency (DOGE) to modernize "federal technology and software to maximize governmental efficiency and productivity." The efforts, across all government departments, are led by tech billionaire Elon Musk, who has been highly critical of the SSA.

O'Malley, who has spearheaded the backlash against DOGE's actions, has warned on numerous occasions that the benefit-paying system could be on the brink of collapse because of the loss of experienced employees who manage Social Security's web of computer systems.

"Everything they're doing is driving this agency to system collapse," O'Malley told CNN. "It will lead to interruptions in service, and that will ultimately cascade into more frequent system interruptions for the processing of claims, ultimately leading to system collapse and eventually the interruption of benefits."

Delays Are Likely, Experts Say

Despite O'Malley's forecast, experts are divided on whether there could be hiccups in the administration of benefits, which were delivered to more than 70 million people nationwide in January.

Jackson Ruggiero, co-founder of DisabilityGuidance.org, said that vulnerable Americans could see disruptions to their benefits.

"I agree with O'Malley. If proposed cuts to Social Security materialize, there will likely be a collapse in the system," he told Newsweek. "Those already receiving benefits may experience delays in their payments—income vulnerable populations depend on."

Molly Weston Williamson from The Center for American Progress think tank, said that DOGE's "assaults on the SSA threaten Americans' ability to access the benefits they rely on to get by," particularly those that receive disability payments. "Any delay or interruption in payments would be catastrophic," she warned.

She also pointed to a January survey that found that 42 percent of Americans aged 65 and older reported that they "would not be able to afford the basics, such as food, clothing, or housing [without Social Security retirement benefits]."

Nicole Thelin, founder and director of Low Income Relief, an organization that connects individuals and families in crisis with vital resources for housing, food and financial aid, told Newsweek that service disruptions, not benefit delivery, are more likely to be impacted. She said SSA "services are always strained," but "additional cuts will only make things worse for the people who need help the most."

According to a report by USA Facts, on average, new disability applicants who received a decision in November 2023 had waited around 225 days, more than seven months.

"While many beneficiaries can manage their benefits and applications online, vulnerable seniors and people with disabilities often rely on in-person assistance or phone support...and they will be most at risk from these reductions," Thelin said. "This is especially true since Social Security offices are being closed in many rural areas, which makes it even harder for these people to get help.

"Beyond immediate accessibility issues, these funding cuts will also lead to dangerous processing delays. Disability claims already take years to resolve, and often require a tedious back-and-forth of appeals to win.

"Deep staffing reductions could make even basic tasks like getting a new Social Security Card or filing for survivor's benefits take significantly longer. These delays would cause serious financial harm to the low-income people who need these benefits the most."