Astrue Nomination Reported Favorably By Senate Finance Committee -- And More On Social Security Budget

This is the text of a press release from Senator Max Baucus, Chairman of the Senate Finance Committee (emphasis in original):

Washington, DC – In a vote off the Senate floor this afternoon, members of the Finance Committee favorably reported to the Senate the nomination of Michael Astrue to head the Social Security Administration. At Astrue’s nomination hearing this month, Finance Committee Chairman Max Baucus (D-Mont.) obtained a commitment from the nominee to “stay out” of political debates over the future of Social Security, including any rehashing of failed privatization schemes. Also today, Baucus applauded the news that the 2007 continuing resolution will restore $200 million in administrative funds to the Social Security Administration (SSA). Baucus has strongly urged the restoration of funds to SSA to prevent backlogs for disability benefit claims from getting worse, and to ward off expected staff furloughs that could have caused service disruptions.

“The next Social Security Commissioner will inherit a slightly brighter budget picture than was envisioned for this year,” said Baucus. “The continuing resolution still doesn’t give Social Security all the operating funds it needs, but at the very least we won’t see the 10-day staff furlough that was feared. Congress can’t forget that funding cuts to Social Security have a direct effect on the well-being of Social Security recipients and applicants. I will keep working to restore full administrative resources to Social Security in the coming year.”

A White House budget request in February of 2006 contained $9.59 billion in 2007 operating funds for Social Security Administration. During congressional consideration of the budget, that amount was reduced by $400 million, creating financial constraints for SSA.

Baucus Commends Former Commissioner Barnhart

Senator Max Baucus, the Chairman of the Senate Finance Committee, which has jurisdiction over the Social Security Administration has issued a statement commending former Commissioner of Social Security Jo Anne Barnhart.

More Evidence Of Social Security Staffing Problems

The National Conference of Social Security Management Associations (NCSSMA) is an organization of Social Security management personnel. They post online the minutes of their meetings. Those minutes give a fascinating insight into the problems faced by Social Security's frontline personnel. The minutes of their January 17, 2007 teleconference have been posted. This sounds awfully boring, but if you are interested in what is really going on at Social Security, these minutes are fascinating.

Here is NCSSMA's discussion of service backlog issues:

Carla asked about whether Congress has commented about the service backlogs. She is seeing an increase in the number of congressional inquiries her office receives. ...

Hugh Stempfley related information about a conference call conducted in Illinois between SSA, represented by CO [Central Office], Chicago RO [Regional Office], and many district managers and congressional staff members from Senator Obama and Senator Durbin’s offices. The call lasted two hours and the focus was on how offices are losing staff without being able to replace them and how the loss of staff has negatively impacted service in the field offices. All concerned concluded that we have resource issues in the field offices right now.

Rick mentioned that he had a call from a manager today who pointed out that the public has an increased expectation of field office service levels but our staffing levels continue to decrease. This is a problem we are seeing in field offices and teleservice centers across the country.

Charlotte Observer On Disability Backlogs

The Charlotte Observer has an article on backlogs in adjudicating disability claims at Social Security. The report that about 20% of clients at a homeless shelter are awaiting action on Social Security disability claims is sobering.

The reporter misunderstood something that I said. I did not tell him that five to six of my clients die each year. I told him that something like five to six of my firm's clients die each year. My firm has six lawyers doing Social Security representation full time.

Budget Picture -- Bad, But Not As Bad As I Thought

An informed source tells me that I was not reading the continuing resolution accurately, or, perhaps, that it is much more complicated than I thought. I will quote from an e-mail I received from this informed source:

A few hints on what you need to look at. The number quoted on page 78 does not include the SSI user fee which is around 117 million. See the SSA appendix. Also there will probably be around another 40 million for SSA salaries and benefits (see page 8 and 9 of CR). Total will be very close to what House approps recommended. This is why Obey's office could put this out:

"...Most programs are funded at FY 2006 levels with increases to cover the cost of pay increases. Necessary additions are made to maintain staffing levels, avoid furloughs, and generally meet increased costs or workloads for agencies most notably: the Department of Justice, the Judiciary, the Social Security Administration, the FAA (including air traffic control), International peacekeeping operations, the Indian Health Service, the Food & Drug Administration, and the USDA Food Safety Inspection Service.

http://appropriations.house.gov/News/pr_070129.shtml

The House amount is right on the line of missing a furlough but leave SSA with a virtual hiring freeze this year which will still be very hard on the Agency.

Budget News Is Bad

The chairmen of the House and Senate Appropriations Committees have released their proposed continuing funding resolution for fiscal year 2007. Hidden inside this lengthy document is §20645(a), which calls for a Social Security budget of $9.137 billion. The President's budget for FY 2007 had called for a $9.496 billion budget for Social Security's administrative operations. Even that much higher budget would have resulted in a loss of 2,545 full time staff positions. The actual FY 2006 budget was $9.109 billion, as best I can tell, which would indicate only a 1% increase for FY 2007 over FY 2006. The FY 2006 level was the funding level provided in the last continuing funding resolution and that was predicted to require furloughing all Social Security employees for 10 days. Is $28 million more enough to prevent employee furloughs at Social Security? Certainly, it is not enough to prevent significant further deterioration in service at Social Security. There may be efforts made to amend this continuing resolution, either in committee or on the floor of the Senate. Everything must all happen rapidly, since the current continuing funding resolution runs out on February 15.

Public Radio On Social Security Backlogs

Public radio's Marketplace show reported on January 29 on Social Security's incredible backlogs in adjudicating disability claims. Listen to the report on-line. Former Commissioner Jo Anne Barnhart spoke to the reporter.

Astrue Nomination Committee Vote On January 31

The Senate Finance Committee has scheduled an executive session for January 31 to get organized, which presumably means making subcommittee assignments. The Committee has scheduled a few small items of business to be decided at the same executive session and the nomination of Michael Astrue to become the next Commissioner of Social Security is one of them. After the Finance Committee acts, the matter goes to the Senate floor.

New Funding Resolution Draft Coming Tonight -- Will SSA Avoid Furloughs?

Today's Wall Street Journal reports that Congressional leaders will release a draft continuing funding resolution tonight. Almost all of the federal government, including Social Security, is operating under a continuing funding resolution, rather than a budget. The current continuing funding resolution will expire on February 15. Congressional leaders have announced their intention to use a continuing funding resolution for the rest of the year, based largely upon the one which will expire on February 15. If unchanged, this continuing funding resolution would probably cause employee furloughs at Social Security. The question is whether Social Security will get additional money.

Developmental Delay Grant Available

From today's Federal Register -- and, yes, this was posted by the Social Security Administration:

The Social Security Administration requests applications for cooperative agreement funding to support projects that will design and implement effective, replicable, and sustainable models which will increase the number of children (birth to age 5) who receive developmental screening and improve the early identification of children with developmental delays and/or disabilities.

This grant may or may not be a good idea, but why is it coming from the Social Security Administration? Was this a Congressional earmark? I hate to beat a dead horse, but when Social Security cannot answer its telephones and it is routinely taking a year and a half and more for Social Security to schedule hearings for sick, desperately poor Social Security disability claimants, most of whom will be awarded benefits by Administrative Law Judges, does it make any sense for Social Security to spend money on something that is so far away from the agency's core function that it sounds like a project for the National Institutes of Health, if anyone?

New Commission Proposed

Medical News Today reports on a new proposal in Congress:

Sens. Dianne Feinstein (D-Calif.) and Pete Domenici (R-N.M.) on Monday introduced a bill to establish a permanent, bipartisan commission that would provide recommendations to maintain the future solvency of Medicare and Social Security, CQ Today reports (Wayne/George, CQ Today, 1/22). The 15-member commission -- which would include seven Republicans, seven Democrats and one independent -- would have to provide recommendations to Congress within one year and subsequently every five years. Under the legislation, the recommendations would have to be reported by House and Senate committees within 60 days or be directly discharged to the House or Senate floor.

Unum Sells Genex

The Associated Press reports that UnumProvident, the nation's largest writer of long term disability (LTD) insurance, has sold Genex, a subsidiary, to a private equity firm. Genex has been involved in case management and medical cost containment in LTD and workers compensation. The case management services have included representing disability claimants before the Social Security Administration. Writers of LTD insurance have a huge interest in obtaining Social Security disability benefits for their insureds since LTD policies offset the Social Security disability benefits. UnumProvident reported only a "small net gain" on the sale.

The sale might free Genex to seek the business of individual Social Security disability claimants who need representation, basically entering the retail market for Social Security representation, rather than relying upon the wholesale business provided by LTD carriers, although there is no sign of such an intent or that Genex could be successful in this should they chose to try it. The sale certainly opens the possibility for dramatic change in the market for LTD carrier representation in Social Security disability claims.

ALJ Erving Torres Alleged To Misuse Handicapped Parking Space

From the St. Petersburg Times:

TAMPA - Each day, administrative law judge Elving L. Torres decides whether people are disabled enough to receive Social Security benefits.

Sometimes he puts himself in the shoes of people who appear before him: He parks his luxury import car in the handicapped spaces outside the building where he works.

A handicapped parking placard appears on the dashboard of his silver Mercedes-Benz AMG coupe. But it was issued to an 86-year-old woman from Bradenton, according to state motor vehicle records. ...

Through a receptionist, Torres declined to speak to a reporter who inquired about his handicapped placard, referring questions to the Social Security Administration's regional office in Atlanta. He declined to answer questions a second time as he approached his car in the parking lot Wednesday.

"I work for a federal agency," Torres said. "I can't speak to you without approval," he said, adding that he would speak if he received permission. ...

Request For Help On Micronesia Issue

Has anyone investigated the issue of whether immigrants from Micronesia allowed into the United States under the Compact of Free Association Act of 1985 are eligible for SSI? These immigrants stand in a unique position under United States law. Their status under Title XVI of the Social Security Act is difficult to determine, at least for me. If you have information on this subject, I would appreciate an e-mail to charles[at]charleshallfirm.com.

Federal Times On Confirmation Hearing

The Federal Times has an article up on the confirmation hearing on Michael Astrue's nomination to become the next Social Security Commissioner.

"Fatness" And Early Retirement

The Michigan Retirement Research Center has published a study on the relationship between "fatness" as they call it and early retirement. I do not understand why they chose to call it "fatness" rather than "obesity", but their findings are interesting nevertheless. Here is their abstract of the study:

Theoretical models argue that poor health will contribute to early exit from the labor market and the decision to take early Social Security retirement benefits (Old-Age or OA benefits). However, most empirical estimates of the causal importance of health on the decision to take early OA benefits have been forced to rely on global measures such as self-rated work limitations or self-rated health. We contribute to the empirical literature by using a more objective measure of health, fatness, to predict early receipt of OA benefits. We do so by estimating the causal impact of fatness within an empirical model using the method of instrumental variables, and testing the robustness of our findings using the most common measure of fatness in the social science literature – body mass index – with what is a more theoretically appropriate measure of fatness – total body fat and percent body fat. Overall, our conclusion is that fatness and obesity are strong predictors of early receipt of OA benefits.

Modeling and SSA -- An End To "Grand Plans"

Looking back, there was a significant topic at the confirmation hearing for Mike Astrue to become Commissioner of Social Security that I did not mention in my summary yesterday. That is Astrue's frequent mention of the word "modeling." This is a word that has been seldom mentioned in conversations about Social Security. Of course, Astrue was not referring to anything having to do with fashion. What he was talking about is often referred to as computer modeling or computer simulation. A classic example would be the design of an aircraft wing. The old method of doing this involved creating a mock-up of a proposed wing and putting it in a wind tunnel to see how it would perform. With computer modeling the aircraft wing can be designed on a computer and the computer model of the wing could be tested on the computer without the need for a physical model or a wind tunnel. This is possible because of the development of complex and sophisticated computer programs that allow users to simulate the real world on the computers.

Astrue was talking about "modeling" as a process for producing figures for Congress on what sort of progress Social Security could make in dealing with its backlogs depending upon what level of funding the agency receives from Congress. Perhaps, someone at Social Security has devised a computer program that does "model" their operations. More likely, there is no such computer program, but there is plenty of information about employee productivity that would allow experienced agency personnel to come up with high quality estimates of what could be achieved with various levels of funding. This would be the equivalent of a computer model.

This may sound rather boring, but it is actually an important change of focus. The focus at Social Security over the last dozen years or so has been on "grand plans" which various Commissioners of Social Security promised would yield dramatically improved performance. The first of these grand plans was "Re-engineering" which began in about 1994. Re-engineering got a trial. The trial showed that the plan did not work and "Re-engineering" was abandoned. The second grand plan was "Hearing Process Improvement" or HPI. Trial implementation of HPI began in about 1999. There were early signs that HPI was not working, but in the waning days of the Clinton Administration, Social Security went ahead with full scale implementation of HPI. The result was a disaster, with dramatically worsened performance and vastly increased backlogs. Ignoring the warning signs from "Re-engineering" and HPI, Jo Anne Barnhart, who became Commissioner of Social Security in 2000, launched planning for a third grand plan, which incorporated a technological change -- using paperless scanned files instead of physical files to hold the records concerning a claim for Social Security disability benefits, called EDIB, as well as organizational changes referred to as Disability Service Improvement or DSI. There has been enough implementation of EDIB that it is already clear that it will yield only modest productivity gains at Social Security, at best. DSI is only now starting into implementation -- just as Barnhart leaves her position at Social Security -- so DSI has not had an opportunity to succeed or fail, but there is almost no one who either works at Social Security or who deals with the agency on regular basis who has hope for DSI achieving much.

"Re-engineering", HPI, EDIB and DSI had a huge impact upon Congress' view of Social Security. They created the strong impression that the ever-increasing backlogs at Social Security were the fault of poor organization at Social Security which could be corrected by re-organization, that is that the problems were largely independent of Social Security's budget. It has become increasingly obvious that this approach does not work. Smart people have been trying for decades to re-organize Social Security to get greater productivity and for the most part they have failed. The result of relying upon re-organization instead of budget has been backlogs that can be easily measured and reductions in quality of work produced that are not so easily measured.

In talking about modeling, Astrue appears to be getting away from reliance upon the grand plans that have repeatedly failed Social Security. He is telling Congress that performance at Social Security is tied closely to the agency's operating budget. It is not up to the Commissioner of Social Security to produce a grand plan that magically solves Social Security's problems. It is up to the President and Congress to decide what level of service they are willing to pay for. With modeling, Astrue is going to say, in effect "Here is what you can expect based upon these possible levels for the operating budget you give Social Security. You decide and I'll do the best I can to operate within what you give me. Don't expect me to create a grand plan that pulls a rabbit out of a hat."We can hope that this approach yields a bigger budget for Social Security and better agency performance.

In fairness to Commissioner Barnhart and her predecessors, I should note that the era of grand plans at Social Security corresponds exactly with the era of Republican control of Congress. This may be more than a coincidence. It may be that the grand plans were developed because Republicans in Congress demanded that they be created or because they made it clear that any improvement in service at Social Security could only come from productivity improvement since the agency was not going to get more money, no matter how badly service suffered. Senator Bunning gave an excellent representation of a Republican attitude that may have led to the grand plans, as he vehemently told Astrue that he did not want to hear anything about budget problems at Social Security. He knew that the problem was poor performance at Social Security and he demanded that Astrue do better. Bunning, a Republican, was at one time in the House of Representatives and the Chairman of the House Social Security Subcommittee. Listening to Bunning, it is easy to understand how a Commissioner of Social Security would have felt pressured to come up with a grand plan. Bunning is now in the Senate, his party is no longer in control of Congress and the Ranking Minority Member of the Finance Committee seems to agree that budget is the key to better performance at Social Security, so Bunning's views, while still important, are not controlling.

Ticket to Work Panel Activities

Social Security's Ticket to Work and Work Incentives Advisory Panel has scheduled a meeting for February 8 and 9 in Atlanta. Martin Gerry is scheduled to speak, so he must definitely still be at Social Security, although his future may be in a bit of doubt after yesterday's confirmation hearing testimony by Mike Astrue who strongly downplayed the Disability Service Improvement plan that has been Gerry's baby for the past five years.

The Panel has posted minutes of all of its meetings and working papers. One working paper entitled "Ability or Inability to Work: Challenges in Moving Towards a More Work-Focused Disability Definition for Social Security Administration (SSA) Disability Programs" may be worth quoting at some length, since it displays the state of knowledge and expectations at the panel and its staff:

The disability concepts from other programs tend to employ a more dynamic definition that allows for changes in disability status over time and different environments. Unlike the SSI and DI programs that assess permanent disability status at the time of application (emphasis added), other programs tend to use changing disability concepts during initial and on-going assessments for program eligibility. In general, these other systems have a more continuous measure of disability that first focuses on an applicant’s residual capacity at initial assessment and then moves to different levels of severity after a participant has shown a continuing inability to work during on-going assessments. Consequently, the disability criteria used at initial assessment [in disability programs other than Social Security] are often different from those used during ongoing disability reassessments. Another major difference is that while other systems have a permanent disability measure, they often employ different levels of this definition, including partial and full disability benefits, depending on a program participant’s impairment severity and/or inability to work. Finally, the definition of work itself and the role of employers also provide insights on possible modifications to the disability definition for the SSI and DI programs, which focuses on substantial gainful activity (SGA), rather than employment in a specific occupation. ...

The alternative is to break away from the current all-or-nothing benefit structure of the SSI and DI programs and move towards a continuum of disability that is similar to other programs. Several options within this continuum will influence the size of the population effected, as well as the costs of providing services.

Low Expectations

A columnist at The Telegram & Gazette of Worcester, MA shares his experience in calling Social Security's 800 number to get some help. He was delighted to wait only nine minutes to speak to a person. He was willing to share his happiness with the world even though there are strong suggestions in his account that the person at Social Security with whom he talked never took care of his problem -- a monthly Social Security check that never arrived. Instead, he was signed up for direct deposit, which may help prevent the problem in the future, but which does nothing about the check that is already missing. Perhaps, he will not stay delighted if the missing check never shows up and he has to call back a few more times before he gets his money.

Social Security Inspector General Backs Off Fining Employees

From Govexec.com:

Social Security IG to Employees: Forget Those Fines Oops, our mistake. That appears to be the latest message from the Social Security Administration inspector general's office about its effort to impose millions of dollars in fines on four Social Security Administration employees. According to the National Treasury Employees Union, which is representing three of the four workers in challenging the penalties, the IG's office has agreed not only to withdraw the proposed fines, but not to seek any other punishments, either. The employees were accused of using expert testimony improperly to help justify benefits decisions. But NTEU pointed out that they did so at the direction of an administrative law judge.

Astrue Marginalizes Barnhart's Plans

I thought this point from today's hearing on Michael Astrue's nomination to become Commissioner of Social Security was so important that it was worth going back to get an exact quote. Senator Baucus asked Astrue about benchmarks for progress on dealing with Social Security's backlogs. Here is an exact quote from Astrue's answer: "Commissioner Barnhart has tried to do some very thoughtful things. Those are somewhat on the margins. Ultimately, a lot of this is brute force in terms of people, unless there's some radical change in the system." I suppose that standing alone one could read this as a call for "radical change in the system", but in context he was certainly not suggesting that radical change was necessary or desirable. The implication was clear that he did not think that anything other than a bigger operating budget and more personnel at Social Security was going to reduce the backlogs. This may help explain the report that Astrue has not bothered to contact Barnhart since his nomination. He may not be too interested in the approach she had been taking, which he considers to have been working "on the margins" rather than on the problem itself.

Watch Recording Of Astrue Hearing

The recording of the Senate Finance Committee's hearing on Michael Astrue's nomination to become Commissioner of Social Security is available for viewing through the Committee's website.

Asrue Confirmation Hearing

Some notes from watching the Astrue confirmation hearing:

1. It is obvious that Astrue will be confirmed and soon.
   
2. Senator Baucus, the Chairman of the Committee, makes it clear that Astrue has firmly promised to stay out of anything political and especially to stay out of privatization. Senator Hatch later tries to get Astrue to say that he might "help" bring about Social Security reform. Astrue gives no such commitment to Hatch.
3. Senator Baucus talks of removing Social Security from the budget -- which would dramatically improve the prospects for Social Security getting an adequate administrative budget. The Chairman of the House Social Security Subcommittee strongly supports this idea also. However, the Social Security trust funds are taking in far more money than they are paying out at the moment. Taking Social Security out of the budget would make the deficit appear vastly larger. In general, Baucus talks a lot about Social Security's budget problems.
   
4. Senator Kerry, who is from Astrue's home state of Massachusetts, gives a warm introduction for Astrue. Senator Kennedy also wanted to be there to introduce Astrue, but he had to be elsewhere.
5. Senator Grassley, the ranking Republican on the Finance Committee, also talks about Social Security's budget problem.
6. Astrue reveals that his father had a brain tumor and stroke some years ago and he helped his father file for Social Security disability benefits.
7. Astrue takes credit for ending non-acquiescence when he was at Social Security earlier.
8. In talking about Commissioner Barnhart's Disability Service Improvement project, Astrue says he wants to review it. He would like to roll out more rapidly those parts of the plan that are least controversial and least costly. I have no idea what he could be referring to.
9. Astrue says that he is an incrementalist on reorganization. He says that no sweeping reorganization is likely with him as Commissioner.
10. Several Senators question Astrue on Social Security's role in regard to undocumented immigrants.
11. Senator Baucus asks Astrue about benchmarks for agency performance, particularly in regards to backlogs. Baucus says the backlogs are an "outrage" and it would be "irresponsible" not to do something.
12. Astrue says that Barnhart's plans are on the periphery of the problem of backlogs and that "brute force", apparently referring to the need for more manpower, is needed.
    
13. Astrue says that 60 days after a budget is finalized for this year, which should be February 15, he can talk with the Committee regarding plans for reducing Social Security's backlogs. Senator Baucus makes it clear that he is very interested in this.
14. Senator Baucus asks Astrue to be more cooperative with employee unions. The question arises because Barnhart listened to everyone, except the employee unions, with which she had a surprisingly frosty relationship. Astrue promises to meet with the unions.
15. The hearing lasted about one and a half hours. There were no witnesses other than Astrue.
    

View Astrue Confirmation Hearing Online

Michael Astrue has been nominated by President Bush for a six year term as Commissioner of Social Security. The Senate Finance Committee has scheduled a hearing on the nomination to begin at this hour. The hearing may be viewed live online. Astrue's written statement has not yet been posted.

Bush Mentions Social Security In State Of Union

President Bush included a call for Social Security reform in his State of the Union Address Tuesday night. Early response from Democrats indicated little interest in pursuing the idea, according to Reuters.

Cambodian Refugees Investigated In California

From InsideBayArea.com:

More than two dozen Cambodian refugees in Oakland and elsewhere in the East Bay are fighting allegations that they fraudulently applied for benefits from the Social Security Administration and say they were unfairly targeted. ...

Many of the Cambodians are patients of Mona Afary, a licensed marriage and family therapist who specializes in working with Afghans and Cambodian refugees. She now works with the refugees at the Center for Empowerment of Refugees and Immigrants in Oakland.

Afary has diagnosed many of her patients with post-traumatic stress disorder, sometimes several people in the same family, Weiss and Lunsford said. That — combined with what Social Security may see as Afary's lack of proper clinical training to make such diagnoses — could have triggered the investigations, Afary, her patients' attorneys and spokespeople for Social Security said.

The attorneys accused investigators of lacking the clinical training to assess whether someone was truly faking mental illness, as well as cultural insensitivity toward people who were traumatized by the harsh privations suffered under the Khmer Rouge. Many of the refugees came here in the 1980s. ...

This is not the first time Cambodians and their health care providers have been the target of Social Security fraud investigations. Similar investigations have taken place in Southern California, Boston and Washington state over the last decade. In those cases, some parties involved with the Cambodians were accused of fraud and others cleared ...

Barnhart Gone -- Who's In Charge?

Social Security has not posted the name of the person designated as the Acting Commissioner of Social Security now that Jo Anne Barnhart's term as Commissioner has ended. An anonymous post on the CONNECT board reports that Linda McMahon, Social Security's Deputy Commissioner for Operations has the job, although this conflicts with the previously established hierarchy which would have given Larry W. Dye, the Commissioner's Chief of Staff, the job. It is certainly possible that the White House made this decision, but has not sent out a press release on what they would consider to be a very mundane matter.

Interestingly, although Social Security's website shows the Commissioner's job as vacant, it shows Martin Gerry still as Deputy Commissioner for Disability and Income Security Programs, even though Gerry was brought in by Barnhart and seemed to be her right hand man. It is a bit hard to imagine Gerry working with another Commissioner.

Commissioner Nominee "Often At The Center Of Controversy"

A 2005 article in the Boston Globe described Michael Astrue, President Bush's nominee for Commissioner of Social Security, as being "often at the center of controversy." This is an intriguing statement which deserves scrutiny, although the scrutiny I can do is limited, since I have never met Mr. Astrue, nor have I even talked with someone who knows him.

The first controversial time in Michael Astrue's life, as best I can tell from looking at records available on the internet, was in 2001 when the newly elected President George W. Bush suggested Astrue as a possible Commissioner of the Food and Drug Administration (FDA). Astrue was never formally nominated for the position. Eventually, he was forced to withdraw his name from consideration due to the opposition of Senator Edward Kennedy. At the time the Senate was controlled by Democrats. Senator Kennedy, from Astrue's home state of Massachusetts, was chairman of the committee that would have considered Astrue's nomination. His opposition made Astrue's confirmation impossible. Kennedy's stated reason for opposing Astrue was that Astrue was employed in the pharmaceutical industry. This seems slightly surprising since Astrue was from Massachusetts and at the time had not worked long in the pharmaceutical industry. It would seem that almost anyone nominated to become FDA Commissioner would have some experience in working with the pharmaceutical industry.

One thing that might easily be missed is that even in 2001 the possible approval by the FDA of RU-486, the "abortion drug", was an issue. For Bush to have put Astrue's name forward, it is clear that Astrue must have given a promise to Bush to oppose RU-486, since this issue was of considerable importance to Bush. Although the RU-486 issue was not raised publicly at the time, there is no doubt that had Astrue become FDA Commissioner, RU-486 would have made him controversial.

The next "controversial" time period in Michael Astrue's life was in 2003. At the time Michael Astrue was Chief Counsel and Vice President at Transkaryotic (TKT), a biotech pharmaceutical company. Astrue resigned his job but was then rehired a month later as the company's CEO. Astrue said publicly that he resigned as Chief Counsel to work at the Hudson Institute, a conservative think tank, and to teach law at Boston University, but there is good reason to believe that he was trying to get away from a firestorm that was about to engulf TKT. The company's CEO, Dr. Richard Selden, was accused of making false and misleading statements to the public about the company's prospects for getting FDA approval for a new drug, while simultaneously selling some of his own stock in the company. What was alleged amounted to a "pump and dump", a technique usually associated with fly by night penny stocks.

Although the TKT board hired Astrue as the company's CEO in the wake of this scandal, it is far from clear that Astrue was blameless in the events that led to Selden's downfall. Selden later blamed company lawyers for misadvising him. Astrue was the company's top lawyer. Was Astrue unaware of Selden's misleading public statements about the company? Would not the rules of a publicly traded company have required Selden to notify Astrue before selling stock in the company? It was Astrue's job to keep anything like this from happening at TKT, but it happened.

In 2004 there was a small controversy. Michael Astrue had been Chairman of the Massachusetts Biotechnology Council, an important trade organization, but the Boston Globe reported that he withdrew his company's membership in the Council after the Council's executive director, Janice Bourque, was forced out. Astrue refused to comment publicly, but his apparent concern was that Bourque was forced out by larger biotech companies. There is no sign that any other company withdrew from the Council over the issue.

Transkaryotic (TKT) settled down after Astrue took over as CEO and Astrue was given much of the credit. However, in 2005, with the company's fortunes looking up, Shire Pharmaceuticals Group, a British company, made an offer to buy TKT. Two TKT board members were prominent in support of accepting the offer. Astrue and one other director opposed the sale. The two who supported the sale were partners at Warburg Pincus, a private equity firm, which had a 14% stake in TKT, worth about $200 million. In the end, the board of directors voted to accept Shire's offer. Astrue resigned and led a fight to persuade the company's shareholders to vote down the sale. Astrue lost again and the company was sold. During this process Astrue apparently argued that Warburg Pincus was selling out the company's shareholders, even though Warburg Pincus was a huge shareholder itself and Astrue never publicly identified any ulterior motive that Warburg Pincus might have had.

You have to wonder about the situation. Warburg Pincus had a $200 million stake in the company and no ulterior motive as far as we know. Warburg Pincus is in the business of knowing when to buy and when to sell stock. They must be quite good at it to have the kind of money at their disposal that allows them to take a $200 million stake in a company. Their opinion would be extremely influential with most people. In truth, this was nothing more than a question of valuation and Warburg Pincus had vastly more experience with valuing stock than Astrue. Why would Astrue embark upon such a quixotic adventure as opposing this sale? Was he simply upset that he would no longer be a CEO?

Astrue described the time period of 2001 through 2005 as "a pretty rock-and-roll five years." The question is how much of this was due to intrinsic characteristics of Michael Astrue and how much was due to the politics of 2001 combined with Astrue being employed in an extraordinarily dynamic industry.

A Boston Globe article from 2003 may give some insight on Astrue's character and give some idea of why he does seem to be at the center of controversy with some frequency: '' 'Mike is an incredibly moral guy,' said Dr. Burt Adelman, executive vice president of research and development for Biogen Inc., where Astrue served as general counsel. 'I suspect they got him back [at TKT] because he wasn't going to leave something he was committed to when they were having a problem. He doesn't walk away from a fight.' " The problem is that the flip side of "incredibly moral" is "self-righteous"and the flip side of "doesn't walk away from a fight" is "spoiling for a fight."

Does Astrue have the backbone to do what is needed at Social Security or is he an arrogant, inflexible man who will relentlessly drive forward some personal or political agenda? That is the question for the Senate. I think one can say that Astrue does not sound like the sort of man who, if confirmed, would meekly implement Jo Anne Barnhart's Disability Service Improvement (DSI) vision for Social Security.

The Social Security Game

The American Academy of Actuaries has posted a "Social Security Game" which allows anyone to test how their ideas would affect Social Security's future finances. In this game, merely eliminating the cap on earnings subject to the FICA tax eliminates 93% of the problem of paying future retirees. Creating private savings accounts as part of Social Security does nothing to solve the problem.

Fraud In Honesdale

The TimesTribune.com reports that Rosemary Garton of Honesdale, PA has pleaded guilty to Social Security fraud for cashing her late mother's Social Security checks for 20 years after the mother died. She first told authorities at first that her mother was living with relatives in Philadelphia.

And She Spent Some Of The Money At A Bingo Parlor

From the Tacoma News Tribune:

A federal judge sentenced a Tacoma woman convicted of Social Security fraud to 10 months in prison Friday. ...

Bland, the mother of a school-age son, was awarded federal disability benefits in 1996 after she claimed a bad back and an anxiety disorder made it impossible for her to work.

But two years later, she got her state cosmetology license and started working at her mother’s beauty salon without telling the government. She also spent part of her $550 in monthly benefits at a Fife bingo parlor.

DSI Won't Work Unless This Works

From Federal Business Opportunities, a website that lists opportunities for those seeking to do business with the federal government:

The Social Security Administration (SSA) has a requirement for the services of a contractor to develop an automated, Section 508 compliant*, profiling/screening tool (software) for identifying Administrative Law Judge (ALJ) disability decisions that are likely to be appealed to federal district court and remanded or reversed by the court. The contractor may also recommend the purchase and/or modification of an existing Commercial Off the Shelf (COTS) software package for the profiling/screening tool if an existing product can be identified.

On March 31, 2006, SSA published the final rules establishing a new disability determination and administrative appeals process effective August 1, 2006. Under the new rules SSA is gradually phasing out the Appeals Council?s review of disability claims and replacing it with a review by a Decision Review Board (DRB). The DRB will focus on identifying decision making errors as well as policies and procedures that will improve decision-making at all levels of the disability determination process.

SSA intends to select ALJ decisions for review by the DRB in several different ways, including the use of computer based predictive screening tools. It is envisioned that a sophisticated computer based profiling/screening tool could be developed to help identify unfavorable ALJ decisions that contain characteristics associated with federal district court appeals and remands or reversals. The profiling model will be developed using data recorded at the time of the initial level determination, ALJ decision, Appeals Council review, and the court action. This information includes the applicant?s age, education years, primary impairment, reason for the court remand, etc. The methods for selecting cases for DRB review are expected to evolve over time as more data are available and SSA gains more experience and knowledge in the use of computer-based tools. Any software will make use of current SSA databases and systems architecture already available, if applicable.

The Disability Service Improvement (DSI) plan does not work unless this profiling/screening tool works, since otherwise there will be far too many Social Security cases going to federal court. This would cause intolerable problems for the federal courts and for Social Security. No one knows if screening tools can be made to work, yet DSI is already underway.

Specialization Exam Topics

The North Carolina State Bar has posted a list of topics covered on the examination they gave in November 2006 to applicants to become certified as Social Security Disability Law specialists. The list appears below. The NC State Bar is the only state bar so far which has certified specialists in Social Security Disability Law. The National Board of Trial Advocacy (NBTA) also certifies specialists in Social Security Disability Law, although no state other than Tennessee fully accepts the NBTA Social Security Disability Law certification, to the best of my knowledge.

2006 Social Security Disability Exam Topics To Help Prepare For The 2007 Exam

Asterisks appear beside many of the topics. These asterisks signify topics that were problematic for those taking the 2006 examination. Below is an explanation of the asterisks.

* Missed by 25% or more of test takers
** Missed by 50% or more of test takers
*** Missed by 75% or more of test takers

Where an issue was presented in more than one question, the asterisk or asterisks shown reflect the question that was most frequently missed.

1/3 reduction rule*
Age as factor in disability determination
Alcoholism
Ambulate effectively
Amending alleged onset date**
Appeal of partially favorable decision***
Appeal deadline closely approaching**
Appealable decisions**
Bipolar disorder*
Burden of proof**
Chances of success at various levels of review
Childhood listings*
Close transference of skills*
Closed period cases
COBRA**
Computation of title II benefits
Computing date last insured**
Consultative examinations
Correction of Title II computation errors
Correction of Title XVI computation errors
Court remands
Cross examination of VE***
Death of claimant
Dependent benefits
Diabetes
Disabled widow and widower benefits
Disabled adult child benefits***
Diseases treated by various medical specialties
EAJA*
Effect of receipt of unemployment insurance benefits
Equaling listings*
Erosion of occupational base***
Escalation of claim*
Ethical issues in representing incompetent client**
Exertional and non-exertional impairments
Expedited decisions***
Factors that determine prospects for success of disability claimant**
Failure of claimant to appear for hearing**
Family relationships**
Fee agreement process
Fee petition process
Fees in termination cases
Fibromyalgia
Filing new claim at same time as appeal
Fully insured status
Good cause*
Grid regulations
Hearing continuance
Impairment related work expenses
Interim benefits
Listings*
Medical abbreviations
Medical terminology
Medicare eligibility***
Medicare Part B
Medicare only claims**
Medicine
NC Teachers and State Employees Retirement System, relationship to Social Security benefits*
Non-exertional impairments**
Not severe impairments
Obtaining medical evidence***
On record decisions**
Overpayment of attorney fee*
Overpayments
Passalong provision (Pickle people)***
Past relevant work
Period of disability
Post hearing interrogatories
Procedure on remand from Federal Court*
Protective filing dates***
Recognizing failure to file all appropriate claims***
Recognizing ethical issues in Social Security practice**
Re-entitlement period**
Reopening based upon mental incompetence*
Reopening based upon new and material evidence
Representative payee*
Res judicata and collateral estoppel***
Retroactive Medicare coverage
Retroactive effect of Title II claim
Return to work while claim pending**
RFC
RFC between two ranges of work**
Rulings**
Schizophrenia***
Sentence 4 versus sentence 6 remands*
Sequential evaluation
SGA
Social Security abbreviations
Spotting signs of retardation or mental illness**
SSI resources
SSI transfer of assets
SSI child disability
SSI benefits effective date
SSI -- requirement to file all other claims**
Subsidized employment*
Surviving divorced spouse benefits***
Sustained work activity
Transferability of skills
Trial Work Period*
Unsuccessful Work Attempts *
VA decisions**
VE qualifications***
Waiting period for Title II benefits
Withdrawing from representing claimant
Workers compensation offset, including issues raised by clincher agreements**
Worn out worker rule

Five Years For Social Security Fraud

Elmo Shepard has been sentenced to five years in prison for Social Security fraud for working under his late brother's Social Security number while drawing Social Security disability benefits, according to a story in the Chattanoogan.com.

Acting Commissioner To Be Dye?

Under an order issued some months ago by President Bush, Larry W. Dye, Social Security's Chief of Staff will become the Acting Commissioner of Social Security as of January 20, when the position becomes vacant because of the end of Commissioner Barnhart's statutory term. At least Dye will become the Acting Commissioner assuming that Dye is still at Social Security and that the President has not altered the succession at the last minute. Social Security's website shows Dye still at Social Security as the Chief of Staff. Perhaps, Social Security will put out a press release on Monday to make it absolutely clear.

The name of the Acting Commissioner is not without importance. Each working day dozens of Social Security claimants sue the Commissioner or Acting Commissioner of Social Security and they need to know whom they should list as the defendant.

An Assessment Of Jo Anne Barnhart's Term As Commissioner

Today is the final day in office for Jo Anne Barnhart, who has been Commissioner of Social Security for around five and a half years. Other than Govexec.com, few seem to be noticing this event. The Baltimore Sun has completely ignored her leaving.

Any evaluation of Barnhart's term as Commissioner should start by acknowledging a paradox. Upon becoming Commissioner, Barnhart frankly acknowledged that there were severe problems in Social Security's disability programs, with the biggest problem being how long it was taking to adjudicate cases. She promised to undertake dramatic reforms to make the situation better. Her frank acknowledgment of Social Security's problems and promises for reform have drawn praise from Republicans and Democrats alike. So what is the paradox? The paradox is that the Social Security disability program problems that Barnhart inherited are still there as Barnhart leaves office and they have become worse. Indeed, Social Security as an agency can accurately be described as crumbling, yet Barnhart remains widely admired for her work as Commissioner.

Barnhart promised to make things better, but things got worse. How could she leave office with the aura of having been a successful Commissioner of Social Security? Three reasons come to mind. First, Barnhart has been quite willing to listen to other people. In the Bush Administration this has not been a common virtue. Second, she has not had a nutty right wing agenda. Again, this makes her stand out in the Bush Administration. Third and most important, Barnhart has shown herself to be an excellent politician. She has succeeded in having herself defined by her ambitions rather than by her achievements.

If we are to base an appraisal of Barnhart on her actual achievements, we can only believe her to have been a successful Commissioner if we believe the following three things:

1. The only reason that there are still big backlogs at Social Security is that Congress would not appropriate the money that Barnhart asked for and that President Bush put in his budget for Social Security.
2. EDIB (paperless files) is going to make Social Security significantly more efficient.
3. DSI (Disability Service Improvement, Barnhart's reorganization of the Social Security disability process) is going to bring significantly greater efficiency and consistency to disability determination.

Barnhart has been claiming for the last three or four months that there would be no major backlogs at Social Security if Congress had just voted for the budgets that President Bush put forward. It is impossible to either prove or disprove this claim. However, the cuts that Congress has made in Social Security's budgets, while serious, cannot realistically be said to account for backlogs approaching two years in giving claimants hearings on Social Security disability claims or to account for the agency's inability to answer its telephones in a timely fashion.

One also has to wonder why Barnhart has only been willing in the last three or four months to blame Social Security's backlogs on an inadequate budget. Why was she almost completely silent on this subject for five years? If Barnhart had been willing to make a fuss about her budget would Social Security have gotten more money? There is no way to know, but Barnhart would be in a stronger position to blame Congress if she had complained publicly that the budgets that Congress was providing were inadequate to provide basic service.

While Congress must bear the blame for what has been appropriated for Social Security, Barnhart's conduct as Commissioner has not helped Social Security's budget situation and has probably hurt. She came into office promising that service at Social Security could be dramatically improved with some improved technology and what amounts to a reorganization. A reasonable Congressperson would have concluded from this that Social Security's service problems were relatively minor and that there was no pressing need for additional funding for Social Security's administrative budget. Had Barnhart concentrated upon Social Security's budget from the beginning rather than distracting Congress by promising a relatively painless fix, Social Security might be in much better shape today. If nothing else, Congress would have a more accurate idea of what the problem is.

Barnhart has also chosen to spend huge sums of money on the implementation of EDIB, the paperless file that she has claimed will make Social Security much more efficient. In the short run the money spend on EDIB has been taken away from current operations. This has hurt the agency. Implementation of any new technology also causes at least short term disruption in operations. That disruption has been quite visible with EDIB and has hurt Social Security in the short run. The question is whether the long term advantages of EDIB outweigh these short term costs. Unfortunately for Barnhart, by this point we have enough implementation of EDIB that we can say that, at best, EDIB, will never yield more than minor productivity gains. Indeed, Barnhart, herself, has been noticeably quiet on the marvels of EDIB over the last year or two -- since about the time the first reports came in on how EDIB was affecting productivity, reports that have yet to see the light of day. This makes, implementation of EDIB look like a very questionable accomplishment for Barnhart.

There are also issues about how EDIB has been implemented. Why was EDIB based upon TIFF files rather than PDF files? TIFF versus PDF sounds arcane, but it is not that complicated. The dominant scanned file technology in the marketplace is Adobe Acrobat, which uses PDF files. TIFF is a technology that has lost out in the marketplace. Other than at Social Security, TIFF is a legacy technology, something that has to be dealt with because there are still files around that were scanned in TIFF years ago, but not something used to scan new files. Commissioner Barnhart chose to hire a contractor who is charging huge sums of money to program TIFF to provide features that are already available off the shelf in Adobe Acrobat. Why lock Social Security into spending huge sums of money to create and maintain a proprietary program that largely replicates a program that is already available in the marketplace? No one ever forced Barnhart to answer this question.

Barnhart has also chosen to turn to large contractors to do most of the scanning for EDIB. This means that Social Security offices receiving material to be scanned generally do not do the scanning in-house. They ship the paperwork to huge scanning centers in other states to be scanned. Is this efficient or reasonable?

Implementation of Barnhart's Disability Service Improvement (DSI) plan has just begun. DSI has not had a chance to either succeed or fail. Will it succeed? The odds seem stacked against it.

The centerpiece of DSI is the Federal Reviewing Officer (FEDRO). At the moment, it is unclear whether Social Security has enough money to hire enough FEDROs to implement DSI even in one small region. Even if the money can be found, it is unclear whether Social Security can find enough people willing to work as FEDROs, when the future of DSI remains uncertain. Even if enough people can be hired, Barnhart has never put forward any compelling rationale for why FEDROs are an improvement over the traditional method of review. Barnhart's main argument seems to have been to ask people to look at how bad things are -- and then say that her plan will be much better, without explaining why. It is undeniable that the current situation is terrible, but that does not mean that any change must be a change for the better. Iraq is a good example of the fact that a poorly thought out plan can always make a bad situation worse.

The other major part of DSI is elimination of the Appeals Council. The pesky problem with this is that everyone who has looked at eliminating the Appeals Council, including Barnhart, knows that simply eliminating the Appeals Council will increase the number of Social Security civil actions in the federal courts to unacceptable levels. Barnhart has promised this will not happen because Social Security will somehow find a way to screen out most of those cases by using some computer program to identify those cases and review them before they ever get to federal court. Yet, no such program exists. Social Security has only recently started seeking a contractor to develop such a program. Actually, there would be a simple way of doing this. That would be to review ALJ decisions denying benefits when the claimant is represented by an attorney who has a history of bringing civil actions against Social Security, but that would not be politically acceptable. It would also be a long term disaster for Social Security since it would just encourage more civil actions. Other than identifying cases to review based upon who is representing the claimant, there is probably nothing that will work. The dramatic increase in business for the federal courts caused by eliminating the Appeals Council is a problem that Barnhart has sought to finesse. Her solution has been to leave the problem for her successor.

Barnhart came into office promising to successfully implement EDIB and DSI so that she could "enjoy" them before the end of her term in office. Clearly, that did not happen. Social Security disability claimants cannot now "enjoy" any of Barnhart's achievements, for there are none. There is scant evidence that future claimants will ever "enjoy" any benefit from Barnhart's plans. At the end of the day, Social Security is demonstrably worse off than when Barnhart arrived and there is little reason to believe that future developments will make her time in office look any better.

In the end, the best defense of Barnhart -- and in the context of the Bush Administration, it may not be a bad defense -- may be that she meant well and we could have done a lot worse.

Maybe Grover Norquist Was The Final Straw

The Associated Press reports that President Bush has now grudgingly, but officially, agreed that he will no longer pursue private accounts at Social Security -- or at least he will not pursue private accounts to begin until at least 2011 or 2012. The stated grounds for this decision is the need to produce a plan to balance the budget by 2012.

Grover Norquist has been strongly pressuring President Bush to not include any tax increase in any plan he may have for Social Security. There was probably no hope for a Social Security plan anyway, but eliminating the possibility of a tax increase makes it utterly impossible. Norquist may not be a household name, but he is one of the most important figures in right wing political circles and someone whom a weakened President Bush cannot afford to cross.

Fraud Allegation In Pennsylvania

The Pittsburgh Tribune-Review reports on Angelette Freeze who has been indicted for Social Security fraud for failing to reveal that she was married, a fact that would have affected her right to receive Supplemental Security Income from Social Security.

Grover Norquist Drives Another Nail In the Coffin

From Bloomberg:

Conservative leaders are confident their opposition to higher taxes scuttles any chance that President George W. Bush will make a deal with congressional Democrats to overhaul Social Security.

`Nothing will happen in the next two years'' on Social Security, said Grover Norquist, president of Americans for Tax Reform. After lobbying Bush and Treasury Secretary Henry Paulson, Norquist said the officials made clear to him that ``they don't intend to raise taxes.'' Some Democrats have made Bush's willingness to consider tax increases a precondition for negotiations over Social Security.

House Social Security Subcommittee Members Announced

The House Ways and Means Committee has posted the following list of the names of the members of the Social Security Subcommittee for this Congress:

Michael R. McNulty, NY Chairman
Sander M. Levin, MI Earl Pomeroy, ND Allyson Y. Schwartz, PA Artur Davis, AL Xavier Becerra, CA Lloyd Doggett, TX Stephanie Tubbs Jones, OH		Sam Johnson, TX Ron Lewis, KY Kevin Brady, TX Paul Ryan, WI Devin Nunes, CA

Hearing Scheduled On Astrue Nomination

The Senate Finance Committee has scheduled a hearing for January 24 on the nomination of Michael Astrue to become the next Commissioner of Social Security. No hearing has been scheduled on the nomination of Andrew Biggs to become Deputy Commissioner at Social Security. The failure to include Biggs' nomination in the January 24 hearing suggests that Biggs will never get a hearing.

COLA To Three Decimal Places

Social Security has published some of the least exciting rules in its history and that is saying something. Here is the summary from the Federal Register:

We are revising our rules that deal with automatic cost-of-living increases to primary insurance amounts under title II of the Social Security Act (the Act). The revision is necessary because, beginning with the Consumer Price Index (CPI) for January 2007, the Bureau of Labor Statistics will publish the CPI to three decimal places. The CPI is currently published to one decimal place as is now reflected in our regulations. With this revision, our rules will conform to the change in the reporting of the CPI.

House Appropriations Subcommittee Members

The House Appropriations Committee has named the members of its Labor, Health and Human Services, Education, and Related Agencies Subcommittee, which has jurisdiction over Social Security's appropriations. The list is below. Note the Dave Obey, the chair of this subcommittee, is also chair of the full committee, even though he is listed as only an ex officio member of the subcommittee. The Appropriations Committees may be more important for Social Security at this point than the substantive committees having to do with Social Security.

Chair: Dave Obey (WI)
Nita M. Lowey (NY)
Rosa L. DeLauro (CT)
Jesse L. Jackson, Jr. (IL)
Patrick J. Kennedy (RI)
Lucille Roybal-Allard (CA)
Barbara Lee (CA)
Tom Udall (NM)
Michael Honda (CA)
Betty McCollum (MN)
Tim Ryan (OH)
Dave Obey (WI), Ex Officio

MINORITY

Ranking Member:
James T. Walsh (NY)
Ralph Regula (OH)
John E. Peterson (PA)
Dave Weldon (FL)
Michael K. Simpson (ID)
Dennis R. Rehberg (MT)
Jerry Lewis (CA), Ex Officio

VA Disability Claim Backlogs Mirror SSA Backlogs

It is not just the Social Security Administration that has enormous backlogs of disability claims. Here is an excerpt from a CBS Evening News report:

Veterans returning from Iraq and Afghanistan have already filed 176,000 new disability claims, but have run into a VA backlog of more than 400,000 cases. VA officials say reducing this backlog is their top priority.

"I am not happy with it. I want it to be shorter," says [VA] Secretary Jim Nicholson.

Nicholson says the hurdle is that every claim has to be verified when none of the records are on computers. "They're all paper and some are (very) thick. We are working this; it's a big deal for us. It's a high priority," Nicholson says. [Note that VA is saying that a transition to paperless files is the key, which is exactly what the Commissioner of Social Security has been saying, although there is no evidence to date that the conversion to scanned files is doing anything to reduce the backlog at Social Security.]

But Nicholson insists the VA is not understaffed, an assertion veterans groups call absurd. Lewis sees a mistake-prone agency in need of a wartime upgrade.

Medicare Part B Income-Related Premium Adjustment Appeals

Social Security has issued a new Program Operations Manual Series (POMS) section giving an overview of the appeals process for the new income-related adjustments to Medicare Part B premiums. Suffice it to say that both Social Security and the Centers for Medicare and Medicaid Services (CMS) have to be praying that they get few of these appeals.

Washington Post On Civil Penalties

Stephen Barr in his column in the Washington Post reports on the huge civil fines proposed by Social Security's Inspector General for a few Social Security employees who allegedly used misleading statements or omitted material when preparing decisions at the direction of an Administrative Law Judge.

McDermott Gets Income Security And Family Support Subcommittee Chairmanship

The Seattle Times reports that Jim McDermott of Seattle has been named chairman of the Income Security and Family Support Subcommittee of the House Ways and Means Committee. The Subcommittee had been known previously as the Human Resources Subcommittee. It has jurisdiction over the Supplemental Security Income (SSI) program, administered by the Social Security Administration.

Mike McNulty To Head Social Security Subcommittee

The Albany Times Union reports that Representative Mike McNulty will become the Chairman of the House Ways and Means Committee Subcommittee on Social Security. McNulty has strongly opposed making private accounts part of Social Security. Although I doubt that the Ways and Means Committee would have authority to do this, one McNulty idea is particularly interesting:

The new job will give McNulty an opportunity to tackle one of his pet peeves: The budget trick that allows annual surpluses in the Social Security trust fund -- overpayments from workers and their employers -- to be used for funding other government operations.

"Here in Congress, we ought to get to honest budgeting," McNulty said in an interview. "Social Security trust fund monies ought to be used for Social Security recipients, not for other purposes."

NADR Issues Newsletter

The National Association of Disability Representatives (NADR), an organization of non-attorney representatives of Social Security disability claimants, has issued its Winter 06-07 Newsletter. The Newsletter contains a good deal of news about NADR's upcoming conference in Albuquerque.

Democrat Proposes Panel On Cutting Social Security

From the Washington Post:

Leaders of the Senate Budget Committee want to assemble a bipartisan panel of lawmakers and administration officials to deal with the skyrocketing costs of Social Security and other entitlement programs, with the goal of bringing a reform proposal to a vote in Congress later this year.

Budget Committee Chairman Kent Conrad (D-N.D.) said he and his predecessor, Judd Gregg (R-N.H.), have asked House and Senate leaders to consider appointing the panel, which would be composed of an equal number of Republican and Democratic lawmakers. They said they have also asked the White House to participate.

Conrad declined to provide many details of the panel, saying too much information could "kill this baby in the crib."

CIGNA Hires Social Service Coordinators Disability Services

CIGNA, an insurance company which writes long term disability (LTD) insurance, has issued a press release saying that it has hired Social Service Coordinators Disability Services to represent its insureds on their Social Security disability claims. Insurance companies writing LTD insurance have a huge interest in their insureds obtaining Social Security disability benefits, since the LTD benefits are offset by the Social Security disability benefits. In recent years, LTD insurers have preferred dealing with non-attorney groups for this representation. From Social Service Coordinator's website, it appears that to this point the company has been involved in helping states get people off Medicaid and on Medicare.

Split Circuits On Internal Manuals

Professor A. Benjamin Spencer of the University of Richmond Law School reports in his Split Circuits blog on a split among the Federal Circuit Courts of Appeals on the issue of whether Social Security's internal policy manuals such as HALLEX and POMS are binding upon the Social Security Administration. The 9th Circuit held that these manuals have no binding effect upon the agency, while the 1st and 5th Circuits have held that Social Security must generally follow its own internal guidelines.

For Those Worried About Social Security Furloughs

Make of this what you will. It is from Gov.Exec.com:

We had an interesting lunch in our offices today with Paul Anderson and Susan Becker of the public affairs shop at the Government Accountability Office. They noted that like executive branch agencies, GAO has been working through contingency plans for what to do if Congress enacts a measure essentially freezing its funding this year. And also like other agencies, among the possibilities GAO is considering is employee furloughs. Interestingly, congressional staffers have responded to this possibility by asking GAO officials what would happen if the House and Senate prohibited them from using furloughs to cut costs.

Inspector General Issues Report

Social Security's Office of Inspector General (OIG) has issued it Fall 2006 report to Congress. It is surprising that the report is an expensively printed full color document, which sounds like a questionable use of public funds, especially for an agency which may have to furlough staff because of its short budget. The OIG is supposed to be fighting waste.

Astrue's Nomination Sent Back To Senate

Michael Astrue's nomination to become Commissioner of Social Security was not acted upon during the last Congress. President Bush has now renewed Astrue's nomination in this Congress, as well as Andrew Biggs' near hopeless nomination to become Deputy Commissioner of Social Security.

House Ways And Means Business Meeting Posponed

The House Ways and Means Committee business meeting scheduled for today has been postponed. The members and chairmen of subcommittees, including the Social Security Subcommittee, will be up for decision at this meeting. No new date has been announced.

Texas Woman Pleads Guilty To Social Security Fraud

Pamela Gwen Green of Port Arthur, TX pleaded guilty to Social Security fraud, according to The Examiner, a Texas newspaper. She was working under a relative's Social Security number while drawing Social Security disability benefits.

Social Security Fraud In Sacramento

KCRA reports on Angelica Ferrer of Sacramento who pleaded guilty to Social Security fraud going back 25 years and involving $131,000.

The President's Notion Of Social Security Reform

The following excerpts from a Dow Jones article seems to confirm that the White House is seeking a plan to "save" Social Security in which Democrats take the blame for cutting benefits and raising taxes, while President Bush takes the credit for some sort of private account.

U.S. President George W. Bush would prefer not to boost Social Security taxes, but is ready to listen to all ideas on entitlement reform, the White House said Tuesday, declining to explicitly rule out the idea of a tax hike. ...

Bush has tasked Treasury Secretary Henry Paulson with working with lawmakers on a fix for the ailing Social Security system. The talks, conducted behind closed doors, have triggered speculation that a bipartisan compromise could include raising the $97,500 limit on income subject to the Social Security payroll tax and adopting Bush's proposed personal retirement accounts.

Asked if taxes were off the negotiating table, Snow said, "We never said that they were on the table." ...

Democrats have shown no willingness to accept retirement accounts, particularly if they are funded by payroll taxes. Investment accounts, however, remain at the top of Bush's Social Security reform agenda.

"We'll let the debate proceed, but you know what the president's bright lines are: he believes it's important to have an investment component that allows people to take advantage of the far superior rates of return that one gets investing in a market place," Snow said.

National Retirement Risk Index

The Center for Retirement Research at Boston College is an important resource that draws little public attention. A recent release gives information about their "retirement risk index" which deserves wider attention. Here is their description of their recent research on this subject:

In June 2006, the Center for Retirement Research released the National Retirement Risk Index (NRRI). The results showed that even if households work to age 65 and annuitize all their financial assets, including the receipts from reverse mortgages on their homes, 43 percent will be at risk of being unable to maintain their standard of living in retirement. Households are more likely to be ‘at risk’ if they are young, have low incomes, or lack pension coverage.

This brief looks at the three major factors that have caused the Index to increase since the early 1980s. These factors are: 1) a decline in Social Security replacement rates due to the decline in one-earner couples and the increase in Social Security’s Normal Retirement Age; 2) lower pension replacement rates as a result of the shift from defined benefit to defined contribution plans; and 3) lower annuity payments due to the dramatic decline in real interest rates. These negative factors have been only partially offset by a modest increase in financial assets, and an increase in the retirement income that homeowners could potentially obtain through reverse mortgages.

Having identified the key movers, this brief also updates the Index from 2004 to 2006. During this period, the run-up in housing prices was cancelled out by a corresponding surge in mortgage debt, which resulted in no change in the ‘at risk’ status of any of the Index’s age cohorts. However, compared to the 2004 Index, the 2006 Index has more Generation Xers and fewer Baby Boomers. Since Generation Xers are more likely to be ‘at risk,’ this change increased the Index slightly to 44 percent.

First Installment Of Annual Statistical Supplement Published

Social Security has begun publishing its annual statistical supplement for 2006. The full supplement is enormous and gives a wealth of information about everything at Social Security. This is just the first installment.

No Sign Of Overwork At Social Security's Press Office

The website for Social Security's main press office shows that it has at least five employees. In 2006 that office put out a total of seven press releases. Undoubtedly, the office responded to a number of press inquiries, but anyone who looks back over the press articles linked in this space will not see all that many where anyone from Social Security's press office is quoted. It seems unlikely that the main Social Security press office is getting even one call a day from anyone in the press. Note also that Social Security has ten regional press officers to handle the workload.

In May 2006, while Social Security as a whole was struggling to meet its Medicare Part D workload, Social Security was having a national conference for its public affairs personnel, featuring Willard Scott and Ari Fleischer as paid speakers.

Treating Physician Rule A Problem At VA As Well As SSA

The "treating physician rule" which requires Social Security to give special weight to the opinion of a treating physician when making disability determinations has been a frequent bone of contention. The Durham, NC Herald-Sun reports on exactly the same problem at the Department of Veterans Affairs, which also prefers to rely upon the opinions of its staff physicians rather than the opinions of treating physicians.

House Appropriations Committee Members

The House Appropriations Committee probably is more important to the Social Security Administration than the House Ways and Means Committee which has substantive jurisdiction over the agency. No subcommittee assignments have been announced yet. Courtesy of Congress.org, here is a list of the members of the full committee, however.

Committee Chair Rep. David R. Obey (DEM-WI-7th) Ranking Member Rep. Jerry Lewis (REP-CA-41st) Democrats (37) Rep. John Murtha (DEM-PA-12th) Rep. Norman Dicks (DEM-WA-6th) Rep. Alan Mollohan (DEM-WV-1st) Rep. Marcy Kaptur (DEM-OH-9th) Rep. Peter Visclosky (DEM-IN-1st) Rep. Nita Lowey (DEM-NY-18th) Rep. Jose Serrano (DEM-NY-16th) Rep. Rosa DeLauro (DEM-CT-3rd) Rep. James Moran (DEM-VA-8th) Rep. John Olver (DEM-MA-1st) Rep. Ed Pastor (DEM-AZ-4th) Rep. David Price (DEM-NC-4th) Rep. Chet Edwards (DEM-TX-17th) Rep. Robert Cramer (DEM-AL-5th) Rep. Patrick Kennedy (DEM-RI-1st) Rep. Maurice Hinchey (DEM-NY-22nd) Rep. Lucille Roybal-Allard (DEM-CA-34th) Rep. Sam Farr (DEM-CA-17th) Rep. Jesse Jackson (DEM-IL-2nd) Rep. Carolyn Kilpatrick (DEM-MI-13th) Rep. F. Allen Boyd (DEM-FL-2nd) Rep. Chaka Fattah (DEM-PA-2nd) Rep. Steven Rothman (DEM-NJ-9th) Rep. Sanford Bishop (DEM-GA-2nd) Rep. Marion Berry (DEM-AR-1st) Rep. Barbara Lee (DEM-CA-9th) Rep. Tom Udall (DEM-NM-3rd) Rep. Adam Schiff (DEM-CA-29th) Rep. Michael Honda (DEM-CA-15th) Rep. Betty McCollum (DEM-MN-4th) Rep. Steve Israel (DEM-NY-2nd) Rep. Tim Ryan (DEM-OH-17th) Rep. C.A. Ruppersberger (DEM-MD-2nd) Rep. Ben Chandler (DEM-KY-6th) Rep. Debbie Wasserman Schultz (DEM-FL-20th) Rep. Ciro Rodriguez (DEM-TX-23rd) Republicans (29) Rep. C.W. Bill Young (REP-FL-10th) Rep. Ralph Regula (REP-OH-16th) Rep. Harold Rogers (REP-KY-5th) Rep. Frank Wolf (REP-VA-10th) Rep. James Walsh (REP-NY-25th) Rep. David Hobson (REP-OH-7th) Rep. Joseph Knollenberg (REP-MI-9th) Rep. Jack Kingston (REP-GA-1st) Rep. Rodney Frelinghuysen (REP-NJ-11th) Rep. Roger Wicker (REP-MS-1st) Rep. Todd Tiahrt (REP-KS-4th) Rep. Zach Wamp (REP-TN-3rd) Rep. Tom Latham (REP-IA-4th) Rep. Robert Aderholt (REP-AL-4th) Rep. Jo Ann Emerson (REP-MO-8th) Rep. Kay Granger (REP-TX-12th) Rep. John Peterson (REP-PA-5th) Rep. Virgil Goode (REP-VA-5th) Rep. John Doolittle (REP-CA-4th) Rep. Ray LaHood (REP-IL-18th) Rep. Dave Weldon (REP-FL-15th) Rep. Mike Simpson (REP-ID-2nd) Rep. John Culberson (REP-TX-7th) Rep. Mark Kirk (REP-IL-10th) Rep. Ander Crenshaw (REP-FL-4th) Rep. Dennis Rehberg (REP-MT-At-Large) Rep. John Carter (REP-TX-31st) Rep. Rodney Alexander (REP-LA-5th)