Senator Tom Coburn (R-OK) has put forth a new proposal for cutting the federal deficits. It is by far the most ambitious proposal out there. The chances of this being adopted by this Congress are nil. My guess is that the chances of anything like this being adopted by a future Congress are virtually nil. However, I keep getting asked about it so here are its Social Security elements:
- Means test Social Security
- Increase full retirement age to 69
- Increase early retirement age to 64
- Switch to chained CPI method of computing cost of living adjustment (which slowly but significantly cuts Social Security benefits from what they would be under current law)
- Reduce spousal benefits from 50% of the Primary Insurance Amount to 33%
- Make continuing disability reviews the first priority in administering Social Security's disability benefits programs, ahead of adjudicating new claims for benefits
- Eliminate the medical improvement standard in continuing disability reviews
- Eliminate interim benefits for those who are appealing disability benefits terminations
- Remove the maximum collection amount for SSI overpayments
- Reduce SSI benefits by eliminating the $20 disregard
- Reduce SSI child's benefits for families with more than one child on benefits
- Eliminate the ability to file a new disability claim while another is pending on appeal
- Eliminate reconsideration (this would actually cost money)
- Close ALJ record one week prior to hearing
- Implement government representation at ALJ hearings (this one too would actually cost money since the evidence is that it does not affect the outcome in any significant way)
- Raise the category of "approaching advanced age" to at least 58-60
- Reduce disability benefits to the early retirement amount once a disability benefits recipient reaches early retirement age
- Allow Social Security disability applicants to use Ticket to Work while they are still applying for benefits
- Time limit Social Security disability benefits. After an unspecified length of time disability benefits recipients would have to reapply in order to stay on benefits, regardless of how sick they may be
- All disability benefits recipients for whom medical improvement is possible must have a "treatment plan" designed to return them to work
- Shift SSI management from Social Security to the states
Remember that I said that it appears to me that the chances of anything like this ever being adopted are virtually nil.
I have to think that Coburn must either not be planning to run for re-election or that he feels that it is inconceivable that he could be seriously challenged when he runs for re-election.
It may or may not pass Congress as proposed, but many of the suggested reforms are long over due. In particular, the "time limited benefits" proposal on pp.24-25 would eliminate need for CDRs and thus be very cost effective. It would greatly encourage rehabilitation and return to work.
ReplyDelete"Eliminate the medical improvement standard in continuing disability reviews"
ReplyDelete"Make continuing disability reviews the first priority in administering Social Security's disability benefits programs, ahead of adjudicating new claims for benefits"
hallelujah. people on the rolls who are not really disabled are the worst drain on SSA.
The system should be strongly geared towards ensuring benefits are used to obtain medical help and improve. Once you improve...back to work.
"I have to think that Coburn must either not be planning to run for re-election or that he feels that it is inconceivable that he could be seriously challenged when he runs for re-election."
ReplyDeleteWho do you think would be against any of his ideas? They all seem to be pretty much common sense approaches to reform. They may be "radical" to a system that abhors change, but they would help put the system back on track and bring it closer to it's original 1936 mandate.
To ANON 11:18,
ReplyDeleteThe people opposed to these changes are obvious -- Democrat politicians, disability advocates, AARP and similar groups for changes affecting retirees, disabled individuals, and claimant's representatives.
Raising "approaching advanced age" from 55 to 58-60 will be especially offensive to claimant's representatives as it will take away many (undeserved) favorables. Regulations were proposed a few years ago to raise closely approaching advanced age to 52 and advanced age to 57, but the proposed regulations were withdrawn after NOSSCR and others threw a hissy fit.
Sounds like typical cold conservative ideas. It sounds tough especially from a $100,000+ salaried government employee.
ReplyDeleteMy question is if some of these republicans hold the disabled and or poor in low regard,who is well favored by them?
Coburn proposes a new bend point at the 40th percentile of average earnings, and therefore a significant cut in benefits for the upper 60% (in addition to the 16% cut due to the the increase in retirement age and the 0.3%/yr cut due to the COLA). However, this is not a "means test," which implies that benefits depend on the retiree's "means" (usually taxable total income, since this is the easiest number to get).
ReplyDeleteHe also suggests that the trust fund isn't real, and dismisses out of hand any tax increases. Why? If most people are willing to pay a little more in taxes to maintain benefits (and I think they are), then what's wrong with that?
In the comment above, I forgot that the replacement rate for the first $749 was increased by 5% (so he can claim to be helping out the lower income people), which would mean a few of the top 60% would not have a decrease due to the new formula (you'd have to be $170 above the 40th percentile to see an increase, I think, but above that the decrease is significant). Also, the increase in retirement age is gradual, although the new COLA is immediate.
ReplyDeleteYes, conservatives are so uncaring about the poor and disabled that they have the gall to want programs in place to help the poor and disabled get vocational training/rehabilitation so they can attempt to re-enter the workforce (the disabled) or obtain a more secure and better paying job (the poor) and experience the sense of pride and dignity that comes from being a productive member of society.
ReplyDeleteIt would be much better to stay with liberal programs designed to keep the poor and disabled dependent on the government.
It will never pass as presented - not even close - though it should. IMHO, it's actually not enough "radical" - SSI needs to be eliminated altogether (first for children and then for adults too), Med-Voc grids too (disability is a legal term of art based on medical problems - I can care less for someone's age at which most of Americans keep working andlack of edu), and fairly strict rules of evidence and procedure 9like in immigratiosn courts) must be implemented with ONLY attorneys appearing in hearings and appeals on behalf of clts. Yeah, it won't happen.
ReplyDeleteThere are several deal breakers in there that have nothing to do with raising the retirement age or restraining the COLA.
ReplyDelete1) Using 33% of the PIA to calculate spouse benefits would probably be the most significant cut (in terms of overall dollars) in the history of the Social Security system. It would also fall most heavily on low income families who are most in need of the money. It would also fall most heavily on part of Mr. Coburn's core constituency: Christian conservatives who are more likely to have stay at home spouses.
2) The combination of eliminating the medical improvement standard along with interim benefits isn't just harsh, it's downright punitive, again on the most vulnerable. It's also not clear how much money it would save because it would make CDR appeals much more attractive to the private bar (because of the pot of past-due benefits that will be available).
3) Reducing disability benefits when the person reaches reduced retirement age would involve actually cutting benefits to someone who is already receiving benefits. Imagine how popular that would be?
4) Eliminating the $20 exclusion of income for SSI would not save much money, but again would create a field day for the press to write stories about the poor being screwed while the rich have their tax rates reduced.
As Charles said, this is a non-started. Even tea-partiers would flee from it once they learn the details.
If this plan was presented to the public and the reasons for the changes were well explained, much of the plan would be popular.
ReplyDeleteRemember that although Sen. Coburn is quite conservative, he's one of the Republicans who works quite well with Democrats. He's one of the bipartisan "Gang of Six" and caries a lot of weight in the Senate. I would not just disregard his ideas.
ReplyDeleteHonestly, if you raise the retirement age and limit the COLA you are done. Everything else in this proposal is simply vindictive because the first 2 suggestions would do more than enough to fix any solvency problems. I have no idea why Coburn felt the need to gild the lily by adding additional cuts that will only lead to outrage by the public.
ReplyDeleteThere are so many problems with this proposal it is hard to know where to start. But there are some good points.
ReplyDeleteI like the talk about adjusting the percentage of benefits (e.g. cutting the spousal benefits to 33 percent). There are just too many Baby Boomers who are aging into Social Security for the working taxpayers to pay for them. They will have to take some time of adjustment.
I am not totally against raising the age. It is hard to put a number on when person should be entitled to benefits. But somwhere in the 65-70 range should be reasonable.
All the other suggestions are just ridiculous. Tops on the cuckoo list is eliminating the grids. These are just guidelines but give people benefits for the natural process of aging. Also, the rule about closing the record 1 week prior to the hearing is totally delusional. I have seen this in the past and never works. An ALJ should have as much evidence as possible w/o some arbitrary timeline.
I would say 30 percent of the proposal is reasonable and the other should (and probably not) be adopted.
Why don't we just print more $ and throws it around from trucks?... That would eliminate need for the entire SSA - such a saving!
ReplyDeleteSome ideas have merit.
ReplyDeleteThe government representative project was flawed from the start and in the end died in court from not being adequately separated from what is now ODAR.
A major flaw was that the GRs were tasked with both increasing affirmations (more time and cost) and moving cases faster (more stipulate reversals). Also, it was undermined by may ALJs, while other ALJ saw it as a way of doing even less work because they had no responsibility (in their view) for developing the record.
There was also a budgetary fear that having a SSA representative would obligate SS to also provide the equivalent of public defenders for the unrepresented.
And the whole GR test never did have wide spread and deep support from Baltimore or what is now ODAR leadership. So it was extended and extend, because they never could get the results -- what ever they were -- that they expected from the field test.