The fee paid by attorneys and others who receive direct payment of fees for representing Social Security claimants will remain at 6.3% of the fee in 2017 subject to a $91 cap per case. Social Security says this is their actual costs. Those of us who represent Social Security claimants feel this is absurd, that the agency's true costs are vastly less, and that the fee is nothing more than a thinly disguised tax.
By the way, whenever I post about fees, I get the response that "real attorneys" collect their fees directly from their clients. That's bunk. There are three basic ways that attorneys collect fees. One is to collect the entire fee up front. A second is to bill clients on a pay as you go basis. This works only when you're representing corporations or wealthy individuals. If the client stops paying, the attorney withdraws from the case. Neither requiring payment up front or on a pay as you go basis is practical in Social Security cases because the claimants are usually too poor. The third way is contingent fees. The attorney takes a portion of the settlement or award if the client ultimately receives one. In such cases, the attorney has a lien on the settlement or award. The client cannot avoid paying up. However, the Social Security Act prohibits most liens on benefits. Those who would want to repeal attorney fee withholding without allowing an attorney a lien on back benefits aren't trying to make attorneys collect their fees like "real attorneys." Those "real attorneys" who represent claimants on a contingent fee basis have a lien giving them an assurance of receiving a fee. If you want to repeal withholding but give me the same lien as "real attorneys" have when they represent clients on a contingent fee basis, I'm with you. How about it? Also, by the way, I'm not aware of any other situation where attorneys have to pay a fee for their lien on a settlement or award.