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This study, funded in part by the Administration on Intellectual and Developmental Disabilities and by the National Institute on Disability and Rehabilitation Research, has determined trends in federal, state, and local government spending for services and income maintenance for persons with intellectual and developmental disabilities (I/DD), mental health needs (MH), and physical and sensory disabilities.

Spending by federal, state, and local units of government constitutes a large proportion of the resources available to assist people with disabilities in the United States. These public funds pay for health care, income maintenance, special education, vocational rehabilitation and training, and long-term care including housing and related residential support services. Funds are allocated directly to individuals as well as to schools, health care organizations, and tens of thousands of nonprofit and proprietary disability services organizations.

The findings of this study illustrate the increasing size and growth rate of disability spending as well as a strong, continuing shift away from the use of institutional and nursing facility care toward more individualized community residential and personal support services.

Public Spending and Services for Disability

Public spending for disability programs in the U.S. totaled $619.4 billion in fiscal year 2008. This constituted 12 percent of total federal, state and local government spending in the U.S. that year. Thirty-one percent of disability spending ($190.2 billion), the largest component, was allocated for long-term care; 28 percent ($175.2 billion) for income maintenance [29 percent when long-term care related income maintenance is included]; 26 percent ($158.3 billion) for health care; and 14 percent ($86.7 billion) for special education. The $9.0 billion for long-term care-related income maintenance included federal Supplemental Security Income (SSI) benefits for Home and Community Based Services (HCBS) Waiver participants with disabilities ($5.3 billion) and SSI state supplement payments for community-based services ($3.7 billion). The Medicaid HCBS Waiver program, authorized under Title XIX of the Social Security Act, allows participating states to develop residential alternatives for individuals with disabilities who would otherwise require care in an institutional facility. Such institutions include nursing facilities, state mental hospitals, or state-operated institutions for people with I/DD.

Sixty-five percent of total fiscal year 2008 spending for disability services and income maintenance ($402.2 billion) was allocated by the federal government; 26 percent ($163.3 billion) by state governments; and 9 percent of the funding ($53.9 billion) was allocated by local units of government, primarily school districts. A total of 57.6 million individuals with disabilities were assisted by public sector financial commitments in 2008. This is a duplicated count and includes income maintenance assistance to 24.2 million individuals; general health care assistance to 18.3 million individuals; long-term care assistance to 8.2 million individuals; and assistance to 6.9 million children and youth in special education programs.

For a more extensive discussion of disability spending trends and state-by-state data for 2006, see David Braddock's paper for the Federal Reserve Bank of Boston (PDF).

A series of eight charts summarize disability spending and participants for the U.S. during 1997-2008 (PDF).

You can also create 10 types of interactive charts that compare states and regions for fiscal year 2008. Click the button below to get started.