I posted on April 21 about a Social Security Administration notice in the Federal Register seeking comments on the use of "master" and "sub" accounts as well as pre-authorization of drafts immediately after benefits are deposited as a means of collecting debts out of Social Security benefits. I mentioned that this seemed to me to raise questions about Allsup's "Overpayment Recovery Service." Allsup represents Social Security disability claimants mostly on behalf of Long Term Disability (LTD) insurers.
LTD plans always contain an offset for Social Security disability benefits. Many people win Social Security disability benefits only after a lengthy struggle. In these cases there are large amounts of back benefits. When the back benefits are paid, the LTD insurer has its hand out wanting back what it had earlier paid. Collecting this offset from the insured might be a problem. Allsup describes its Overpayment Recovery Service as "Withdraw overpayment funds directly from claimant’s bank account using our patented electronic process." I cannot say exactly how this "patented electronic process" works, but it seems obvious that the notice that Social Security published has to do, in part, with what Allsup is doing.
Allsup has belatedly responded to my post.
LTD plans always contain an offset for Social Security disability benefits. Many people win Social Security disability benefits only after a lengthy struggle. In these cases there are large amounts of back benefits. When the back benefits are paid, the LTD insurer has its hand out wanting back what it had earlier paid. Collecting this offset from the insured might be a problem. Allsup describes its Overpayment Recovery Service as "Withdraw overpayment funds directly from claimant’s bank account using our patented electronic process." I cannot say exactly how this "patented electronic process" works, but it seems obvious that the notice that Social Security published has to do, in part, with what Allsup is doing.
Allsup has belatedly responded to my post.
My opinion is that what they are doing is abusive, especially when one considers that they are both trying to represent a Social Security disability claimant and collect a debt from the claimant. This is a hopeless conflict of interest. More directly, what they are doing is a subterfuge to avoid the statute that makes assignment of Social Security benefits illegal:
The right of any person to any future payment under this title shall not be transferable or assignable, at law or in equity, and none of the moneys paid or payable or rights existing under this title shall be subject to execution, levy, attachment, garnishment, or other legal process, or to the operation of any bankruptcy or insolvency law.
No comments:
Post a Comment