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Key Findings Details

The Social Security Windfall Elimination and Government Pension Offset Provisions for Public Employees in the Health and Retirement Study
by Alan L. Gustman, Thomas L. Steinmeier and Nahid Tabatabai
WP 2013-288
  • About 3.5 percent of households in the Health and Retirement Study (HRS) are subject to either the Windfall Elimination Provision (WEP) or Government Pension Offset (GPO) provision features of the Social Security benefit determination process that limit the benefits of employees who worked in jobs not covered by Social Security, but who are also are eligible for Social Security benefits.
  • The present value of the Social Security benefits of affected households is reduced by roughly one fifth, amounting to 5 to 6 percent of the total wealth affected households accumulate before retirement.
  • Households affected by both WEP and GPO lose about one third of their benefit.
  • Limiting WEP adjustments to Social Security benefits to half the size of the pension from uncovered employment, as in current law, reduces the penalty from WEP for members of the original HRS cohort by about 60 percent and substantially affects any interpretation of the law’s impact that is based solely on the provisions of the adjustment to the Primary Insurance Amount formula under WEP.