Andrew Biggs Is Still Annoying -- And Wrong

     When George W. Bush campaigned for the partial privatization of Social Security, Andrew Biggs, a Social Security employee, was at his side. That rankled me. I felt it was deeply inappropriate for a Social Security employee to take on such a politicized role. Bush later nominated Biggs to become Deputy Commissioner of Social Security. Senate Democrats blocked that nomination, suggesting that I wasn't the only one rankled by what Biggs did.
     After his stint at Social Security, Biggs landed a job at the American Enterprise Institute, a Koch brothers front organization.
     Biggs has a blog at the Forbes website on which he's posted a response to the Social Security discussion at the Democratic Presidential debate Tuesday night. The ideas of expanding Social Security and lifting the cap on wages covered by FICA both came up in the debate. Biggs makes the point that lifting the FICA cap wouldn't generate enough revenues to fund an increase in Social Security benefits. This is accurate but it's also rich coming from someone who campaigned for completely undermining Social Security's finances. President Bush never released a plan for partially privatizing Social Security but he was promising to keep paying benefits to everyone already drawing benefits or near retirement age, to not increase the FICA tax and yet to divert much of the FICA tax receipts to private accounts. Put all of that together and it would cost trillions of dollars. Did Biggs and Bush ever put forward a plan for paying for this? Of course not. Republicans never have to pay for their Social Security plans. Only Democrats have to pay for their plans.

     Biggs points out that raising the FICA cap wouldn't be enough to assure that no further change would have to be made anytime in the next 75 years to protect Social Security's funding. He seems to believe that means there's no point in raising the FICA cap. Right. Lifting the FICA cap would only assure program funding until 2080 so obviously that idea is worthless. In fact, if you remove the FICA cap, you could do some modest benefit increases and still assure the future of the Trust Fund well into the future. That was what the Democratic Presidential candidates were talking about.
     I think that Biggs will have to come up with some better arguments to convince the American people that it's a bad idea to raise taxes on the wealthy in order to give higher Social Security benefits to many.

No COLA This Year

     As expected, there will be no Cost Of Living Adjustment (COLA) this year for Social Security recipients. This is the third time this has happened since 2010. It had never happened before 2010.
     Unfortunately, unless there's a change in the law, Medicare premiums will be increasing dramatically for almost one-third of Social Security recipients. Since the Medicare premiums are deducted from Social Security benefits that means that a lot of Social Security recipients will see a significant drop in the payments they receive.

Colvin Heading To Florida

     Carolyn Colvin, the Acting Commissioner of Social Security, will be in Sarasoto, FL for a town hall discussion on Thursday. Representative Vern Buchanan invited her. Buchanan, a Republican, is a member of the Social Security Subcommittee of the House Ways and Means Committee.

GOP May Demand Social Security Cut

     From CNN Politics:

... [Senate Majority Leader] Mitch McConnell privately wants the White House to pay this price to enact a major budget deal: Significant changes to Social Security and Medicare in exchange for raising the debt ceiling and funding the government. ...

McConnell is seeking a reduction in cost-of-living adjustments to Social Security recipients and new restrictions on Medicare, including limiting benefits to the rich and raising the eligibility age, several sources said. ...

Editorial On Hearing Backlog

    The Des Moines Register recently ran an editorial decrying Social Security's enormous backlogs of hearings on disability claims. The paper said that "Congress needs to give the SSA the resources it needs while resisting the urge to strong-arm judges who appear to be too productive" but also said that the agency needs a "long term strategy" for reducing its hearing backlog. The problem with calling for a "long term strategy" for reducing the backlog is that no long term strategy can succeed in the absence of an adequate agency operating budget. 

     Iowa is represented in Congress by two Republican Senators, three Republican representatives and one Democratic representative. Congressional Republicans are the sole reason this hearing backlog problem exists. They stand in the way of Social Security getting an adequate administrative budget. Backlogs went up rapidly when Republicans controlled the House of Representatives while George W. Bush was President. They started going down once Democrats took control of the House in 2006 and gave the agency a bigger operating budget. The backlog continued to decrease until the 2010 election which put Republicans in control of the House of Representatives. At that point, the agency's operating budget went to hell. The hearing backlog did a U turn and started shooting up. The Republican majority in the House of Representatives is so deeply entrenched in gerrymandered districts that it is hard to imagine any change in the control of that body for many years into the future. The hearing backlog is rapidly heading to two years. These is nothing to prevent the backlog from going far higher than that. Claimants are losing their right to a hearing.

Benefits Began In 1940

No COLA This Year?

     Looks like there will be no Social Security Cost Of Living Adjustment this year. If I remember correctly, the announcement is due out in mid-October.

CCD Benefit Offset Proposal

     There are signs of a possible consensus forming in favor of some tinkering with the work incentives for Social Security disability benefits, probably some sort of benefit offset program, as the "price" for extending the life of the Social Security Disability Trust Fund. The Social Security Task Force of the Coalition for Citizens with Disabilities (CCD), a major umbrella group, has released its benefit offset proposal. I won't detail the whole proposal but the most important parts are the elimination of the Trial Work Period and Extended Period of Eligibility combined with a benefit offset program whereby claimants would lose one dollar for every two they earn over the amount required to trigger a trial work period month, currently $780 per month.

     First key question: Would the CCD proposal cost money or save money? I'm not sure. I doubt that it will have much effect either way.
     Second key question: Would the CCD proposal give further encouragement for claimants to return to work? The proposal would be easier for Social Security to administer, which is a good thing, but I don't think it would have any significant effect upon claimant behavior. Claimants already want to return to work. The problem isn't the incentives; it's the state of their health. Huge bargains won't induce people to shop at a store if the store's doors are locked.

   Third key question: Can any tinkering with work incentives achieve the goal of reducing program costs. The answer to this one is clear. You certainly can save money by tinkering with work incentives. All you have to do is to reduce the work incentives. Can someone come up with a proposal that reduces work incentives while simultaneously pretending that they are increasing work incentives? Probably. That's the sort of thing that politicians excel at. That may be where we're heading.
     Fourth key question: Is there really a consensus forming to only tinker with work incentives or is this just the game that Republicans play until after the election at which point they reveal their real plan to use the exhaustion of the Disability Insurance Trust Fund to force dramatic cuts?

The Goat Rodeo Continues For Eric Conn's Former Clients

     I've learned a few things about Social Security's re-adjudication of the disability claims of Eric Conn's former clients. Let me share some of what I've heard:

• In at least one case, Social Security's file contains reports from Drs. Huffnagel and Adkins, two of Eric Conn’s pet physicians. The report from Dr. Huffnagel has been excluded from consideration but the report from Dr. Adkins is supposed to be considered. Even though he also did work for Conn, Adkins was also working for Social Security. The agency wants the report that Adkins did for them considered. However, any reports that Adkins did at the behest of Eric Conn are excluded from consideration. He was an upstanding physician when he did work for Social Security but he was a crook when he did work for Eric Conn.
• The claimants who had medical exams at the behest of Eric Conn universally describe the exams as reasonably thorough. The claimants say the exams took about twenty minutes. The write-ups of the exams seem professional. There may be problems with forms completed by these physicians but there's no sign of problems with the exams or the exam reports themselves. For example, there seems to be no reason to disbelieve a report by one of these physicians that he detected crepitation in a claimant's knee. Nevertheless, everything from these physicians has been excluded – unless SSA ordered the exam.
• None of the claimants involved reports having been contacted by Social Security's Office of Inspector General (OIG) or the FBI.
• I had thought that Social Security must have given Administrative Law Judges (ALJs) more instructions for these cases than what is contained in the agency's HALLEX manual. It looks like I was both right and wrong. I was right in believing that they should have been given more instructions but wrong in believing that they must have given additional instruction. It appears that they didn't. The result is confusion. At least one ALJ has refused to admit any evidence dated after the prior ALJ decision. Other ALJs are pondering whether they should admit into evidence the reports from Conn’s pet physicians. Nobody has any idea what the process is for asking permission to consider developments in the claimant’s health condition after the date of the prior ALJ decision. It’s not clear that there is a procedure or that any such procedure would be consistent with the agency's regulations, ALJ independence and the prohibition on ex parte contacts.
• There are signs suggesting that no one at Social Security's St. Louis National Hearing Center, which is hearing the vast majority of these cases, has much enthusiasm for the task they’ve been given.
• So far, it looks like well over half of the claimants involved have not sought legal help. There is reason for concern that these claimants are so intimidated by the criminal investigation that they are too scared to do anything even though none of them has done anything remotely criminal.
• We’re still waiting on action from the District Court on the lawsuit aimed at stopping these hearings. The delay doesn’t seem like a good sign for these claimants since the Court knows that the hearings have begun. I’m pretty sure that there are those at Social Security who decided not to worry too much about what the agency was doing in these cases since they figured that the courts would intervene to stop this mess. I thought so too but it looks like we may have been wrong. The Court may dismiss the case on narrow technical grounds. That won't prevent these claimants from eventually getting relief. It just delays it until after these cases grind through the administrative process for a year or two.

This Is Wrong

     From EM-15034, just issued by Social Security:

Beginning September 25, 2015, the Social Security Administration (SSA) and VA initiated a weekly information exchange agreement in which the VA provides SSA with information concerning veterans who received the VA 100% P&T [Permanent and Total] disability compensation rating. With this release, when an individual contacts SSA, and their social security number is on our database as having the 100% P&T rating, our users will receive an immediate alert that we must expedite the case.

Additionally, when an alert identifies the individual as having this VA rating, no additional proof of the 100% P&T rating is necessary to expedite the case. ...

     We owe our veterans a lot but we don't owe veterans who have 100% VA ratings expediting on their Social Security disability claims. These vets aren't in great financial distress. They have their VA benefits. Other disabled people hurtle towards homelessness while vets who don't really need it get expediting. This is wrong.