Social Security used to post numbers each month showing the amount of fees paid by claimants for representation before the agency but that stopped at the end of 2019. I never gave up. I kept going back to the website expecting that the agency would eventually update the numbers. My patience has been rewarded. They have finally updated the numbers all the way through last month.
For 2019, 390,809 fees were paid for a total of $1,214,557,861. The average fee paid per case was $3,107.80.
For 2020, 360,493 fees were paid, down 8% from 2019. The total fees paid were $1,081,523,523 down 11% from 2019. The average fee paid in 2020 was $3,000.12, down 3% from 2019.
For the first quarter of 2021, 77,754 fees were paid with the monthly average number down 14% from 2020. The total fees paid for the first quarter were $262,694,679 with the monthly average down 10% from 2020. The average fee per case was $3,121.31, up 4% from the 2020 average. However, I would caution about drawing too many conclusions when comparing the first quarter of 2021 with 2020. There are many fluctuations in payments from quarter to quarter and quarters aren't the same length.
In any case, it's no exaggeration to say that those of us representing claimants are hurting. Our costs have gone up with inflation but our average fee per case is either down or stagnate while our total fees are down considerably.
Whenever I post anything about attorney fees I always get sneering responses that essentially go "Well, why don't you just give up representing Social Security claimants?" The answer is that some attorneys have already given up representing Social Security claimants and many more are wondering what they should do. There's no doubt that representing workers compensation or personal injury clients pays better than Social Security. Those of us who specialize in representing Social Security clients have invested a lot of time and money developing our practices and are reluctant to give them up but that won't last forever. The end of the pandemic will help but only so much. This field of practice was in decline before the pandemic. I've already heard a report that it's hard to find a Social Security attorney in the state of Kansas. Expect that to spread without an increase in the fee cap.
By the way, I wonder why these numbers were finally updated now.
19 comments:
How much would the fee cap have to go up to make it "viable" for a business? I know everyone wants to make a bunch of money, lets face it, this isnt rocket surgery. But what is the number really.
I don't think the solution is raising the fee cap. I think the percentage needs to be raised to probably 30%. Most personal injury attorneys around here are charging at least 40 percent.
An increase in the percentage would make a big difference on the viability of the practice. Most case are not fee cap cases, and have not been since the backlog was addressed (case are being processed in a timely manner). Increasing the percentage but keeping the cap where it is would definitely allow for more quality legal counsel.
The reality of the practice is that it is a volume practice. If fees go down, then an attorney has to handle more cases. And if that happens, at a certain point the quality of representation goes down. (Take a look at the public defender programs).
Leaving the cap would still assure that a claimant's interest is still being weighed in the analysis. Most (not all, but most) of my client's really don't care about their back due benefits, its the ongoing month to month that is their concern. Having quality counsel makes them obtaining that more likely.
@8:27
I think timely release of fees would go much farther to make running a disability firm viable. We have some fees (not just one case, but I admit this is not average) approved and not awarded for over 3 years, despite regular contact with SSA on the issue. That may not be normal, but I would estimate on average, fees once awarded still take over 9 months to actually be released. Or SSA could be authorized (by statute, I recognize this isn't possible under current statutes), pay some sort of post-judgment interest on the delay. Delay might seem irrelevant, as fees do get paid eventually, but time value of money means delayed fees are effectively a reduction, and we are talking about thousands of dollars over multiple years, it adds up.
As to the actual fee cap being raised, seems fair to link it to COLA. 25% is not really an absurdly low rate, but it used to be unusual to actual reach the cap. Now it's reached in pretty much every case that goes to a hearing. This was proposed a few years back by Rep John Lewis but I don't think it went anywhere.
I have been in this practice since 1979. There have been a lot of ups and downs during that time.
I currently have a number of problems with the Attorney Fee process. Here are a few:
1.) Attorney Fee Petitions--I use a two-tiered fee contract. I also see a number of Appeals Council and District Court Remands. In some cases, OHO through the ALJ approves the fee contract after a second successful hearing. In most of those cases I filed a Statement requesting that the fee contract be denied. I then have to file an Appeal of the Attorney Fee approval to the Regional Chief ALJ. In some cases, it has taken the Regional Chief ALJ 9 months to file a simple notice agreeing with me and telling me to file an Attorney Fee Petition. In some of those cases, the excess over $6,000 has been released to the client. I then have to file for an overpayment.
2.) Attorney Fee Petition evaluations--For several years I have run into arbitrary and capricious action by some ALJs. They have used the Attorney Fee Petition determination as a way to punish me. I currently have a case involving a hearing, a successful appeal to the Appeals Council and ultimately a Favorable Decision. First, the ALJ approved the Attorney Fee contract. SSA withheld $6,000. I immediately appealed that action. The Regional Chief ALJ took 9 months to agree with my appeal. I filed an attorney fee petition for a little over $10,000.00 in March 2020. I inquired about the Fee Petition in July. OHO said they were sending it to the ALJ for a decision The next day the ALJ decided that the fee was $6,000.00. The ALJ did not provide an rationale. I asked for Form SSA-1179 (Attorney Fee Rationale). OHO said there wasn't any back up. I appealed to the Regional Chief ALJ in August 2020. I have not received an answer. I have called the Regional Chief ALJ's office numerous times about the case. The receptionist sends my calls to random workers. I have left numerous messages without any call backs.
These are just two examples. I also have a large attorney fee petition involving a case that lasted more than 10 years. That was filed in September and I cannot receive any information about it.
I fear that Attorney Fee Petitions filed with SSA are sent to a "black hole." No one is responsible and no one will take responsibility.
About 10 years ago, I had similar problems. I called my Congressman's office. They tried to put me off by stating that I needed to have all of the client's involved sign a release. Some of the clients owed me money and would not communicate with me. I told the Congressman's office that I was the constituent and I would sign a release. I ended up with a two hour meeting with two staff people. Most of those problems went away through the Congressman's office assistance.
I am happy for my long career. I would not want to be starting in this field at this time.
Same COLA as the Claimant?
@11:55
11:16 here. Of course! Setting aside the fact that the current CPI doesn't necessarily accurately reflect costs of the disabled community (generally the criticism is it overestimates transportation costs, and underestimates medical costs), I wouldn't support some more favorable COLA being afforded to fee cap calculations and some less favorable COLA being applied to actual benefit calculations. I want some automatic fee cap increase to be accounted for in the event COLA increases, but not at the detriment of claimants.
The last raise was in 2009 to 6000. If the attorney fee cap was raised each year with the COLA, our fee would now be approximately $7184 per case. If we could be raised to 7184.00 for 2021 and then tied to the COLA into the future, it would make it possible for attorneys to continue the work of representing claimants. I am at a point where I am considering only representing my worker compensation clients on their Social Security claims and not taking per social security claims because it isn't financially viable.
@11:55 No COLA on atty fees. When I started in 86 @41, I had worked for IRS for almost 15 years as JD/CPA.. and my friends thought I was crazy for leaving.. economically, I was. But I was tired of finding things wrong about people and my "creative?" personalty does not make me very amenable to following unquestioning bureaucracy although I liked the straight arrow accountants I worked with. In govt no one likes you,,no support from the top or bottom and so many mgrs of so many functions from lights to law..to protocol.
Today is my 76th birthday and I am glad I left 35 years ago. What hooked me was visiting the hospital the first year out to see a 40 year old AIDS woman who had a third grade education. She had chicken pox..but you could see she was beautiful. (aside: She told me that she always tried to better herself.. by dating guys with white shirts.) She was SSI only and we tried to get her approved (unsuccessfully) before she died. I was hooked. I wanted to make a difference to all the starfish stranded on the beach.
But you ask about money. It's very simple really. Marginal Income cannot be increased by working more hours on a case, because of the cap. The only way to maximize profit is to increase volume or decrease expenses. Voila we have Bender, Mylar, and other non-attorney mills who become non-attorneys because they can't be disciplined by bar and are able to reduce expenses.
I am not going elsewhere because I am too old,needed here, and do ok for 76; but NO I do not advise attorneys to do Social Security unless they can do it economically (pun intended) However, I am happy where I am and can still see that woman's face hoping to get something for her baby..so her S.O. "might" consider adopting....
IF you recall SSA stopped paying fees on December 12, 2019 and didnt start again until the new year. they said they did not stop paying, but the data supports that SSA stopped paying.
Raise the fee agreement amount to 10,000.00. i would bet that most reps would switch to a single tiered fee agreement. Imagine how many hours would be saved at offices and at SSA if there were no need for fee petitions.
The fee agreement cap has been at $6000.00 for too many years..
Case which goes to the ALJ level with an onset and month of entitlemenht going back several years...
These claimants can easily be due retro benefits of 50K+
Yet attorneys still limited to $6000 and once that cap is reached attorneys receive nothing from entitled spouse and children who have also benefited from the attorneys' services.
Fee petition process is too cumbersome , and dependent on the whims of the fee authorizer at SSA. The fee agreement process is better but the cap has to be raised.
if the alj approves the $6k when it shoyld be a fee petition a simple letter to the local office should save you a lot of time. I think that most of the time that is inadvertant.
"These Claimants are losing everything, home, family, pets, proper care they need benefits quickly to save what remains of their lives."
Also
"I deserve more than 25% of the backpay of the Claimant, I worked like 20 hours on this."
@10:19
Seems like the obvious solution is to make attorney fees payable out of the general treasury fund as opposed to out of a claimant's past-due benefits.
Maybe I am doing this wrong, but raising the cap wont make much of a difference. Most of the claims I get approved are not fee cap cases. The length of time the claimant is disabled has not been long enough to cap out the claim.
The fee petition cases for remands, I generally get paid on them. (Generally I do have two that are getting the congressional work over).
But realistically, getting a quick and timely approval doesn't generally result in a cap case, at least for me. Raising the % would have a bigger change in economic viability.
@ 11:45 April 20 - SS is only part of my practice, but I stick with it because of just those experiences you describe. Its worth it from a psychic benefit, a SS win feels a whole lot more substantial than something else. But honestly I worry that the other areas of my practice subsidize my SS clients because of the value of the work per hour.
10:19 I fight like hell for my client's and I am close to losing things during COVID. I'm owed about twenty grand in back payments right now. Some are 14 and 15 months old. Why don't you just be honest and say the disabled don't need attorneys. And as far as this not being rocket science, only rocket science is rocket science. I've done several other areas of the law and none of them have been rocket science. If you truly attempt to master this area of law it is just as complex or more than state worker's comp or PI or even some of the fancy pants corporate shit that is mostly drafted by legal assistants. Maybe those saying it's easy need to write some winning briefs, or crack a book on regulations, or effectively communicate and argue their cases to the multitude of personalities in ALJ land. One thing I know is the enviroment you are in determines if you make a living or not. The powers that be that have been winning recently want a system that is hostile to representation being carried out successfully. This is Tort Reform for Social Security. Same interest groups and same mentality at play. They want us out of the system period.
11:17 wants the tax payer to pay his fees. I have a simple answer for that. NO!
Some time ago the top 100 fee firms and top 100 individual fee generators were listed on this website. Is there a link to that statistic? It was very informative.
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