	Introduction

Social Security's minimum benefit provision, the Special Minimum Primary Insurance Amount (PIA), is an alternative benefit formula that increases benefits paid to workers who had low earnings for many years and to their dependents and survivors. Unlike the standard Social Security benefit formula, which is based on a worker's average lifetime earnings, the Special Minimum PIA is based on the number of years a person has worked. Beneficiaries receive the higher of the two amounts. In 2017, about 39,347 (or about 0.6%) of the 62 million Social Security recipients qualified for the minimum benefit. Four provisions affect both the regular benefit and the Special Minimum benefit:
1. the a ctuarial reduction , which reduces monthly benefits as a percentage of the PIA for people who claim benefits before their FRA; 2. the re tirement earnings test (RET) , which withholds benefits for beneficiaries younger than the FRA who have earnings that exceed a specified dollar amount; 3. the g overnment pension offset (GPO) , which reduces the monthly benefit amount for people who have pensions from employment that is not covered by Social Security, but who are entitled to Social Security spouse or survivor benefits based on a spouse or deceased spouse's work record in covered employment; and 4. the f amily maximum benefit , which limits the total benefit that can be received by all members of a family, varying from 150% to 188% of the retired or deceased worker's PIA. The Social Security Administration projects that the provision will have no effect on people turning 62 years old in 2019 or later. 92-603), at the same time as the Supplemental Security Income (SSI) program. Another argument is that means-tested programs, such as SSI, are a more appropriate way to supplement the incomes of people with low incomes and assets. Who Receives the Minimum Benefit Under the Proposal? As noted above, the effect of the Special Minimum PIA has diminished to the point of being unnoticeable because the Special Minimum PIA is linked to prices while regular Social Security benefits are linked to wages, which generally grow faster than prices. A beneficiary would receive the minimum benefit if it was higher than the standard benefit. CBO analyzed an option that would increase the standard benefit for low-wage workers by up to 40%. A new program could also be established.
Social Security's special minimum benefit provision, also known as the Special Minimum Primary Insurance Amount (PIA), is an alternative benefit formula that increases benefits paid to workers who had low earnings for many years, and to their dependents and survivors. The Special Minimum PIA is based on the number of years a person has worked, whereas the standard benefit formula is based on a worker's average lifetime earnings. The worker receives the higher of the two benefits.
However, the Special Minimum PIA has virtually no effect on the benefits paid to today's new retirees. Under current law, it grows with price levels, whereas the standard benefit is linked to wages. Because wages generally grow faster than prices, the Special Minimum PIA affects fewer beneficiaries every year. In 2017, about 39,347 of the 62 million Social Security recipients qualified for the minimum benefit. Beneficiaries who received higher benefits due to the provision had an average increase to monthly benefits of about $46 in June 2013. The Social Security Administration (SSA) estimates that the provision will have no effect on workers turning 62 in 2019 or later.
Some recent proposals would redesign the minimum benefit. This renewed interest has been sparked by Social Security proposals that would reduce the regular benefit and by concern over poverty rates among beneficiaries who had low wages throughout their careers. However, some have suggested to allow the minimum benefit to phase out, arguing that the provision does not accurately target the working poor, and that there are other programs that are more appropriate for supplementing the incomes of low-income, low-asset people.
Increases in Social Security benefits targeted at lifetime low earners could be implemented in various ways. For example, a new minimum benefit provision could be introduced, the standard benefit could be increased for people who worked for many years at low earnings, or a fixed-dollar benefit could be introduced. Similar provisions could also be introduced through other programs, such as Supplemental Security Income (SSI).