Jul 20, 2019

OIG Report On Use Of Averaging When Determining SGA

     From a recent report by Social Security's Office of Inspector General (OIG):
When a disabled beneficiary has earnings from work activity, SSA conducts a work continuing disability review (CDR) to determine whether the beneficiary engaged in SGA. SGA describes a level of work activity and earnings. Work is “substantial” if it involves significant physical or mental activities and earnings exceed the SGA threshold. The Code of Federal Regulations states SSA can average earnings for a period of work when it determines whether a disabled beneficiary engaged in SGA. During the period for which SSA averages earnings, the beneficiary must have worked continuously, without a significant change in work pattern or earnings. SSA has not established a monetary earnings amount that represents a significant change. However, policy directs staff to consider whether the beneficiary changed positions, job duties, or hours when determining whether a significant change occurred. If SSA finds the beneficiary’s monthly earnings average is below the SGA threshold, it pays benefits for all months. ...

Of the 200 sampled beneficiaries, we identified 58 for whom SSA applied averaging inconsistently or incorrectly when it made SGA determinations. Of these, SSA made questionable payments to 51 based on its SGA determination. SSA issued or withheld payments totaling over $651,000 because it did not apply averaging provisions consistently. As a result of the questionable determinations, SSA

  • paid benefits, totaling more than $607,000, to 40 beneficiaries and
  • withheld benefits, totaling more than $44,000, from 7 beneficiaries. 
SSA’s policy allows employees to exercise their own judgment and discretion when deciding whether to average earnings. As a result, the policy for averaging earnings results in decisions that are not consistent and equitable among beneficiaries.We estimate SSA applied averaging provisions inconsistently tomore than 30,000 beneficiaries. This led to questionable benefit payments or withholding totaling almost $419 million.
     I'm sympathetic to the agency on this one. I don't see how they can come up with truly objective standards nor how they can ensure completely consistent application of any standard. These are just difficult to do. Almost always you have limited information about the exact dates of earnings. The earnings are often highly variable. The regulations have to give agency employees discretion to deal with the million and one situations that come up but whenever you give discretion you're going to have people applying the rules in differing ways. OIG can come in after the fact and say that you should have done something different in many cases but it's not like OIG's judgment is the gold standard. If anything, I'd trust the field office staff to make the right judgment calls more than I'd trust OIG personnel who don't do this kind of work on a regular basis.

3 comments:

Anonymous said...

It sounds to me that they do not fully know what they are talking about. For one thing benefits are not terminated after the TWP. Payments are not given for any month in which earnings are above SGA level but they still getvMedicare benefits regardless of income and they will get benefits for any month in which earning are below SGA . You can earn 10, 000 one month and still get your SSA check for the following month if you only earn 700. This is so throughout the three year EPE period. After the EPE your benefits will terminate if you earn above SGA. Furthermore there is a transmittal
That specufically says NOT to average earnings either during the TWP or the EPE DI 10505.015 C

Tim said...

Hmmm. The real takeaway is... Claimants, don't EVER exceed SGA!

Anonymous said...

So the OIG Audit team has reignited the conservative spook-patrol that believes all disabled persons are faking it?

This study was a waste. If you think the system inadequately documents SGA determinations when averaging, just state that and recommend updates on how it should be recorded.

The outcome of this study is absolutely contradictory from what I see day-to-day. When CRs (or the disability staff at the payment centers) improperly average earnings, it usually results in benefits being suspended for more months than needed. That would result in questionable withholding of benefits, not questionable payments. The lower earning beneficiaries that averaging would hide SGA months are so low on priority that it isn't being widely applied.