Jun 8, 2011

"Revisions To Direct Fee Payment Rules"

Below is the notice of a regulatory package that the Social Security Administration has sent over to the Office of Management and Budget (OMB):

TITLE: Revisions to Direct Fee Payment Rules (3625I)

Social Security must have OMB approval before publishing this in the Federal Register. 

No, I don't know what this is. The "interim final" process that Social Security wants to use suggests that  the agency regards this, or at least wants OMB to regard it, as very minor. Could anyone enlighten us?

Update: I found this:
We are revising our rules to include changes made by the Social Security Disability Applicants’ Access to Professional Representation Act of 2010 (PRA). We are revising the requirements that an eligible non-attorney representative must meet to receive direct fee payment under titles II and XVI of the Social Security Act (Act). We are also making permanent the direct fee payment rules for eligible non-attorney representatives under titles II and XVI of the Act and for attorney representatives under title XVI of the Act. 


Anonymous said...

SSA stopped sending out Social Security Statements to save 30 million dollars, but how much could they save by stop being the collection agency for lawyers.

Anonymous said...

I agree with the first post. SSA needs immediately to get out of the fee agreement, fee paying, fee approving, and fee collecting process altogether. It would save many millions in administrative expenses. If the attorneys can't collect the fees from their own clients, then they can take them to court.

Anonymous said...

So far this year, the SSA has collected from attorneys and representative 6.3% of the attorney fee up to $87.00 per case in "user fees" $87.00 in nearly every case) for a total of $16,283,703 through May.

Last year they collected about $35,000,000.00 is such fees.

Hell, the collection of these fees is a cash cow for the SSA.

But why let facts get in your way.

Anonymous said...

Good point, but I doubt that it's really a "cash cow" for SSA. Why shouldn't the government recover expenses for services provided that aren't essential governmental services?

For those who want to know about the assessment, it's here:


Anonymous said...

The provisions for direct payment of fees to non-attorneys and payment of fees from SSI benefits were originally 5 year pilot projects. Sounds like these are just the regulations needed to make the procedures permanent.

Anonymous said...

OK so SSA collected $35,000,000.00 last year, how much did SSA spend processing everything related to fee agreements last year. Plus the cost to staff the Representative Call Center.

Plus it was a nice move for lawyers to get the 6.3 percent of the fee limited to $75.00, now up to $87.00. That was about just after they got their fees jacked up from $4000 to $5300 and now $6000.

So who is really milking the cash cow?

Anonymous said...

The User Fee is $83.00 not $87.00. As a long time payment center employee, I can say that the public (and non-SSA posters here) would be stunned to know the amount of time devoted to processing cases with representative fee problems and fee processing issues in general. Not all job positions are involved with this of course, but for those that are.....I have actually seen Congressional inquiries and the dreaded "Manager-to Manager" public relations problem referral in rep fee problem cases. Those cases then move to the top of the list, pushing back even further "real" entitlement problem cases. We have now dwindling staff plus dwindling work hours which further skews the time spent on tangential problems. I know our procedures are arcane (believe me I know, I teach this stuff). But smooth processing depends on 3 things---rep or reps (love those multi-appeal, multi-rep, multi-firm cases!) follow our instructions, FO/PC processes accurately, and PC analyzes the aftermath correctly. If there is a problem along the way, you can't image the byzantine mess that can result. I'm just sayin'.....

Anonymous said...

The fee provisions are there because SSA feels it can do a better job of dealing with the issue than the states which already have fee dispute resolution mechanisms in place. Many states have limits on contingency fees and have standard fee agreement language with which attorneys must comply or face the loss of their license.

It is simply not true that every other area of law practice gets their fees directly from clients. Where contingency fees are used, when the case resolves the party paying the award or settlement cuts a TWO-Party check to client and lawyer. The check is deposited into a trust account and appropriate disbursements made.

In other non-contingent type cases, the client pays a retainer against an hourly rate.

If claimants could not enter into contingent fee arrangements, they would most likely not be able to find counsel.

If SSA wants to get out of the fee regulation business, fine. Cut a two party check and let the states' already existing systems police the system. Why duplicate the effort?

Anonymous said...

So lets do the math. Last year there were attorney fees paid in about 500,000 cases.

In a normal case, not a case where anything went wrong, the processing of the payment of the attorney fee is accomplished by taking the total amount calculated as due the claimant, done whether or not there is an attorney, and dividing by 4. There is a cap in most cases so if the number is greater than $6,000, the fee is $6,000. The processor then enters that number, if the system does not do it automatically, and sends that information, along with the claimant payment information, to the Treasury where the automated system takes the numbers and issues the checks.

Except in those cases where there is a problem caused by the ridiculous way the SSA processes anything, my estimate of time spent is about one minute on the attorney fee processing. Lets be generous and give it ten minutes.

That would be 5,000,000 minutes. divide by 60 and we get 83,333 hours. Divide by 2000 for the work hours in a work year and we get 41.666. Lets make that 50 for the number of work years involved in the processing of 95% of the attorney fee cases that involve no special problem.

At $100,000 per work year, those calculations require only higher grade employees, that comes to $5,000,000 per year in costs.

The government collects $35,000,000 for the effort. I say that is a good deal for the Government.

Anonymous said...

Re above: 1. This describes the fee agreement process. If the rep did not file a fee agreement or the agreement was disapproved, the fee is decided based on a fee petition which cannot be automated by "entering a number". Granted, I do not know the ratio of petitions to agreements. I am sure that many more use the agreement rather than the petition. Still, when you are talking about thousands and thousands of cases as a base, even a small percentage can yield a fairly significant workload. To wit: at this moment in time my small staff (4 people currently) has 80 fee petition/fee-related problems pending out of a total 577 cases. That's 14%---a small percentage perhaps, but still a lot of cases when applied against total fee cases processed. (I know this is an entirely random figure and could be different in other components/offices. It will even be different with us tomorrow.) 2. While the funds collected in SSA's coffers from the User Fee may be a good thing, this money can't be used to "buy back" the employee time involved in processing. Funds can't be used to hire more people; employees are streaming out the door and, for the immediate future at least, cannot be replaced. in the example above, the remaining 497 cases (mostly first-line appeals) will to a certain extent have their processing time affected by the need to work in the fee issue cases.

However, this is all just a philosophical discussion, because the rep fee workload is not going anywhere but right where it is.