Lots Of iClaims Fraud

     From a recently released report by Social Security's Office of Inspector General (OIG):

... SSA’s controls that identified potentially fraudulent iClaims were generally effective. However, the number of undetected fraudulent iClaims is unknown. Of the 70,173 potentially fraudulent iClaims OAFP [Office of Anti-Fraud Programs] identified, SSA determined 3,807 were fraudulent, 48,062 were likely fraudulent, 4,825 were not fraudulent, 11,289 were inconclusive, and 2,190 were pending. ...

     Almost 60,000 known cases where they can't tell for sure whether there was fraud or not. They admit that they have no idea how many unknown fraud cases there are. Still, they call that "generally effective"? What would ineffective look like? No, iClaims fraud is a big problem and Social Security doesn't have a handle on it.

OIG On Delays In Scheduling Remands

     From a recent report by Social Security's Office of Inspector General (OIG):

... Administrative law judges (ALJ) decided 49,579 Appeals Council remand decisions from Fiscal Years (FY) 2016 through 2018. Appeals Council remands represent the modification of a prior hearing decision often because the ALJ applied the wrong law, additional claimant or other witness testimony was needed, the claimant did not receive a fair hearing, or the ALJ decisional rationale was insufficient. 

SSA’s policy states that remands should be processed as a priority workload. Hearing offices are required to flag remands when they are docketed into the hearing office and assign them immediately to an ALJ for review. ...

Although remands should be processed as a priority workload, SSA does not define “priority” and does not have a processing time goal for this workload. Of the 49,579 remands processed in FYs 2016 through 2018,

• 22,144 were processed in fewer than 270 days,
• 10,043 took between 270 and 360 days,
• 5,191 took between 361 and 430 days,
• 7,179 took between 431 and 595 days,
• 4,717 took between 596 and 999 days, and
• 305 took 1,000 days or longer to process.  

Our sample analysis found some remands took longer to process because they were not always input immediately in the hearing offices’ master docket or the remands stalled in the Ready to Schedule, ALJ Review Pre-hearing, or ALJ Review Post-hearing stages. ...

     In my experience, this is definitely a problem. I've never understood what's going on behind the scenes but remands often take longer to schedule than new request for hearing cases.

COLA To Be 1.6 Or 1.7%?

     USA Today estimates that this year’s Social Security Cost Of Living Adjustment (COLA) will be 1.6 or 1.7%.

Supremes On The Left? Bob Dylan In The Middle? Patsy Cline On The Right?

Social Security Says She Owes $38,192 But They Won't Tell Her Why

     From the Hartford Courant:

Bill Small of Rocky Hill got a jolt this past March when the Social Security Administration (SSA) notified him in a letter that it had overpaid his wife, Bess, during two decades of disbursing her monthly benefit. And so, now that he and his wife are 85 years old and she has been diagnosed with dementia, the SSA is demanding that he repay a total of $38,192 on her behalf. ...

The retired Air Force colonel, who during a 28-year career piloted multiengine military aircraft all over the world and served in Vietnam, says the government admits it made a mistake and that he and his wife of 63 years are blameless. He asked in June that the SSA waive its demand for repayment.

But on Wednesday, an SSA representative told him during a personal conference in Hartford that his request is being denied. ...

Small said he still hasn’t received an explanation of what specific error by the SSA resulted in the overpayment, as well how it happened and when it began. (He said he doesn’t know how long the overpayments were happening, but if they spanned the entire 22 years, they would have averaged around $145 a month to reach the $38,192 total.) ...

“To approve the waiver of an overpayment we must be able to determine that the individual is without fault in causing the overpayment, and repayment would cause an undue hardship,” Kevin Reino, an SSA public affairs specialist in the agency’s regional office in Boston, said in describing the SSA’s general policy. ...

     Years ago I had a case that might have been a little like this. The client had been an employee of the New York City transit system. Years before he retired somebody at Social Security had made a mistake. The city had sent the agency a reel (I said it was years ago) containing data on employee wages. Somebody at Social Security had run the reel twice, double crediting wages for all those employees. The mistake was only discovered many years later. The mistake resulted in a large number of former New York City transit workers being overpaid by Social Security. I argued that the original award certificate determining the primary insurance amount was res judicata and that there was no basis for reopening it. The Administrative Law Judge bought it and the overpayment was wiped out. At least in that case, we knew why the overpayment had happened. Often, it's almost impossible to get an explanation of how the overpayment occurred. In this woman's case, I'll take a guess that Social Security didn't properly coordinate this woman's wife's benefits with her retirement benefits based on her own earnings.
     By the way, I'll bet that Social Security would take a small fraction of the overpayment amount as a full settlement if the husband makes a lump sum payment offer. Given this woman's age and health, they'll never collect much of the overpayment by way of a repayment plan.

Maybe He Really Is Disabled; Definitely, He Shouldn't Have Access To Weapons

     An Oregon man has been arrested after threatening to shoot up a Social Security office. This was not the first time he had made such threats. Here's what happened at the Administrative Law Judge hearing on his case:

At the July hearing, he yelled at his attorney and an administrative judge and threatened future physical violence, the complaint says. Salem police responded and Carlsen was allowed to leave without arrest after he was escorted out of the hearing room. Carlsen live-streamed his actions, according to prosecutors.

Kotlikoff Interacts With The Real World And Is Shocked By Its Harshness

     Laurence Kotlikoff is a columnist on Social Security issues for Forbes. Mostly he writes about claiming strategies that almost no one uses and oddball rules that he finds outrageous. Mostly, I tune him out because I don't think he's writing about real world problems. If you're a Social Security professional and have read many of his columns I think you understand why. 

     As a welcome change, Kotlikoff is now writing about two problems from the real world. First, he's shocked to discover that Supplemental Security Income's (SSI's) resource limits are draconian. Second, he's shocked to discover that a claimant on Social Security disability benefits who tries to park his income below the agency's Substantial Gainful Activity (SGA) limits can easily end up with a large overpayment. I wish I was shocked by either of these situations but they are an everyday part of my work life. SSI recipients should never accumulate even modest sums of money because the rules are insanely out of date. Social Security disability recipients shouldn't try to park their income below SGA because they almost always screw it up and the consequences of a screw up can be severe.

     What gets me about Kotlikoff's column is that he's appealing to Social Security Commissioner Andrew Saul to do something about these problems but Saul can't. I suppose he could recommend that Congress update the SSI income and resource limits but he can't change them unilaterally and Mitch McConnell won't be doing any favors for SSI recipients. Saul could try to increase the SGA limits but that takes changes in regulations which would require the approval of the Office of Management and Budget which is currently headed by a Director who isn't exactly sympathetic to disabled people. An increase in the SGA limits wouldn't solve the parking problem anyway. As a practical matter, there's nothing Saul can do. Kotlikoff ought to know that.

New POMS On Child Relationships

     There's a new POMS (Program Operations Manual Series) issuance from Social Security updating the agency's policies on child relationships and dependence. It covers issues like children of same sex marriages, in vitro fertilization, posthumously conceived children and surrogacy. This area of the law has always been complicated because outdated state law must be applied in many cases and because things often get messy when human sexuality is involved. The advent of same sex marriages and advances in reproductive technology have made things far more complicated. There's also the problem that the statutes were written a long time ago and may not have been well written even at the time. For example, posthumous out of wedlock children were certainly known when these statutes were written but the Social Security Act doesn't talk about how the agency should deal with those cases other than referring to state laws, which are themselves problematic.

Wyden Plan For Social Security

     Senator Ron Wyden (D-Ore.) has released a plan to devote additional revenue to the Social Security Trust Funds. Unlike the Social Security 2100 Act pending in the House of Representatives, Wyden's plan would rely upon increases in taxes upon capital gains rather than increases in the F.I.C.A. taxes. Also, Wyden's plan, unlike the House plan or Senator Warren's plan, does not call for an increase in Social Security benefits.

     Wyden's plan is particularly important because he is the Ranking Member of the Senate Finance Committee. There's no way that any of these plans pass unless Democrats take the Senate as well as the House of Representatives and the White House in next year's election. If that happens, Wyden stands to become Chairman of the Senate Finance Committee, the Committee that has jurisdiction over both taxes and Social Security, making his views crucial.

     I understand the short term political reasons for using capital gains taxes rather than increased F.I.C.A. taxes to shore up the Trust Funds; however, in the long run Social Security is safer if it is financed through payroll taxes, making workers feel that Social Security is an earned right. That was the genius of Franklin Roosevelt. It's kept Social Security safe for 84 years. Don't mess with success.

Senator Warren Wants To Increase Social Security Benefits

     It’s a different plan than the Social Security 2100 Act that may be moving in the House of Representatives and it’s not fleshed out but Senator Elizabeth Warren, who’s running for the Democratic Presidential nomination, is putting forward a plan to increase Social Security benefits.