New Security Requirements

     From Social Security:

The Social Security Administration (SSA) has added an extra layer of security for our customers when they interact with us online using the my Social Security suite of services. my Social Security account holders are required to use their cell phone, in addition to their username and password, as an additional authentication factor during online registration and every sign in. 

We implemented multifactor authentication (MFA) to comply with Executive Order 13681, which requires federal agencies to provide more secure authentication for their online services. We are committed to using the best technologies and standards available to protect our customers’ data. MFA is just one of the ways we ensure the safety and security of the resources entrusted to us. Since we launched my Social Security in May 2012, we have provided this added security of MFA as an option to our customers.

Now, all new and current my Social Security account holders will need to provide a cell phone number able to receive text messages. People will not be able to access their personal my Social Security account if they do not have a cell phone or do not wish to provide the cell phone number. We expect to provide additional options in the future, dependent upon requirements of national guidelines currently being revised.

     Don't anybody tell Social Security that it's possible to get text messages without a cell phone. 

A Social Security Casebook

     There's old saying that law school isn't set up to teach people the law. It's set up to teach people how to think like a lawyer. This won't make much sense to you if you're not a lawyer but, trust me, it does make sense to anyone who's gone through law school only to realize that they really didn't know much about the law. Given that the focus of law school has more to do with modes of thinking and less with the practical aspects of practicing, you'd expect that Social Security law wouldn't be taught much and you'd be right. However, some law schools do teach the subject. Professor Jon Dubin of Rutgers Law School was kind enough to send me a copy of a Social Security casebook that he and Frank Bloch, Emeritus Professor at Vanderbilt Law School, put together. Actually, this is at least the second edition of the book. It's quite good. I would recommend it to anyone learning Social Security law. 

     I have to say that looking at the price of the book brought home to me how long it's been since I was in law school. I think I remember casebooks being about $30-$40 back then but, of course, we were studying by whale oil lamps back then!

Mind Boggling

     There's a report out that AARP, which bills itself as Social Security's most ardent supporter, is helping fund the American Legislative Exchange Council (ALEC), a sinister far right group which has long advocated privatization of Social Security.

List Of Those Disqualified From Representing Claimants

     Social Security has recently posted a list of attorneys and others who have been sanctioned for misconduct in representing claimants before the agency. It's a longer list than I would have thought although it does go back more than 30 years. I only counted five names added to the list in the year before this was posted. He's not representing clients before the agency now anyway but Eric Conn's name isn't on the list.

Tape Your Conversations With Social Security?

     Laurence Kotlikoff, writing for Forbes, recommends that you tape your conversations with Social Security because "you do not want to be powerless in facing Social Security’s bureaucracy when it is your word against theirs and tens of thousands of dollars hang in the balance."
     What do you think?

Crime Doesn't Pay: Part One Gazillion

     From a Social Security press release:

Sophia Dix, 35, of Newport News, was sentenced today to 15 months in prison for wire fraud.  Dix was also sentenced to three years of supervised release and ordered to pay restitution in the amount of $97,584.94.

Dix pleaded guilty on April 25, 2016. According to court documents, from in or about April 2014, through in or about August 2015, Dix devised a scheme to defraud the Social Security Administration (SSA), where she was employed as a service representative at a district office in Norfolk. She had computer access to Social Security Administration beneficiary information, including bank account data for the direct deposit of benefit payments into the bank accounts of beneficiaries. Dix obtained monies for herself by fraudulently processing computer changes to beneficiary account information so that benefit payments would be deposited directly into prepaid reloadable debit card accounts that she opened at a financial institution in the name of a deceased beneficiary. As a result, Dix fraudulently diverted over $97,000 into the prepaid reloadable debit card accounts, which she used for her personal benefit.

Those Cheating Grannies

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

We reviewed a random sample of 250 Title II spousal or widow(er) beneficiaries to determine whether they reported their marriages to SSA while they were receiving Title XVI payments as single individuals. Of the 250 beneficiaries, we identified 41 who did not appear to have reported their marriages to SSA while they were receiving Title XVI payments and may have received improper Title XVI payments because of spousal income.

We referred these 41 beneficiaries to our Office of Investigations (OI) to investigate their living arrangements while they were receiving Title XVI payments. OI determined seven beneficiaries were not living with their spouses so were not overpaid, and one beneficiary had potentially committed fraud, resulting in a $104,998 overpayment.

OI did not pursue investigations on the remaining 33 beneficiaries because the potential overpayments were below the applicable U.S. Attorneys’ thresholds for prosecution and/or the periods of potential overpayment were outside the statute of limitations. Since OI did not pursue investigations, we referred these 33 beneficiaries to SSA to assess any overpayments. Of the 33 beneficiaries, SSA determined

• 22 were not living with their spouses so were not overpaid, and

• for 7, there was insufficient evidence to proceed with a review. For the remaining four beneficiaries, SSA’s review was ongoing as of July 2016.

Given that our audit did not identify a significant number of beneficiaries who were living with their spouses and overpaid while receiving Title XVI p ayments, we are not making a recommendation.

     Potentially, there are many people who would be affected if Social Security were to start trying to catch widows and widowers who failed to report marriages to the agency. There could be many overpayments and criminal prosecutions. Is Social Security willing to go there? Does Congress want them to? Is disability fraud the only fraud that Congress is interested in?

Try Being Social Security Czar

     Want to run your own simulations of potential changes to Social Security such as raising full retirement age, raising or lowering benefits, lifting the FICA cap? Take a look at the Penn Wharton simulator. 

     It's interesting that the model doesn't even allow you to look at the effects of completely removing the cap on the FICA tax. The model only allows you to raise it to $400,000. Penn Wharton seems to believe that's completely off the table.

     If you're a fan of raising full retirement age or fiddling with COLA, be warned. Neither gets you very far. You're going to have to do a lot more than that.

CDRs Target Children; Little Threat To Adults

     Social Security has released numbers on its Continuing Disability Reviews (CDRs) which determine whether those receiving disability benefits remain disabled and eligible for benefits. In 2015 Social Security did 1,971,812 CDRs. That's a big number. However, 59%, of those reviews were just "mailers." They just mail the claimant a form to complete. Unless the claimant reports that that he or she has gotten better or that they've gone back to work, that's pretty much it. Of the 767,797 who got a full medical review, 201,317 were actually cut off. That's 26% of those who got a full medical review but only 10% of those who were subjected to any sort of review, including the "mailers." As low as that number is, it's misleading. A full 65% of those cut off benefits are children. The agency is really targeting them. If you're an adult drawing Social Security disability benefits, your chance of being cut off due to a CDR is only 5%.

     The bottom line is that few Social Security disability recipients get better. You could review more people more intensively but you'd be wasting money. Many who are unfamiliar with the program think that most Social Security disability recipients have had a heart attack or have been in an automobile accident but that they'll get better. Wrong. Your disability has to be expected to last at least a year to get on benefits. The people who were going to get better never got on disability benefits in the first place. I wish it were otherwise but if you're been disabled for at least a year, it's unlikely that you're going to get better. You can talk all you want about medical advances but if they're going to help you get better, that's probably going to happen within a few months after you get sick or injured.

Chamber Of Commerce Favors FICA Hike In Conjunction With Benefit Cuts

     The U.S. Chamber of Commerce has endorsed an increase in the FICA tax that supports the Social Security trust funds but only in conjunction with benefit cuts and raising full retirement age. This is, I suppose, a step forward for them.

Questions Raised About Margaret Thatcher's Son And U.S. Social Security -- Seriously

     This is from RT, which is apparently a Russian television network so it's obviously suspect (emphasis added):

Secret files detailing the shadowy Middle Eastern business activities of Sir Mark Thatcher, son of the late former Prime Minister Margaret Thatcher, will be kept under lock and key in government archives instead of being published as expected. 

Four batches of documents on the younger Thatcher are being retained despite official legislation dictating documents should be released after 20 years unless there are good reasons to retain them in Britain’s National Archives. ...

Two further files have been designated as "temporarily retained" and have been assigned no date for release. These are titled ‘Mark Thatcher and the Omanis; other allegations against Mark Thatcher’ and ‘Request by Electronic Data Systems to employ Mark Thatcher.’

It is thought the files pertain to Middle Eastern construction contracts and a role Mark Thatcher took up at the US Department of Social Security while his mother was still in high office.

     Of course, it's also an extremely stale story if it's any story at all.

NPRM Packet To OMB On Evidence

     This is Social Security's description of a Notice of Proposed Rule-Making (NPRM) that the agency has sent to the Office of Management and Budget (OMB):

We are proposing several revisions to our medical evidence rules. The proposals include redefining several key terms related to evidence, explaining what is and is not evidence, revising our list of acceptable medical sources (AMS), revising how we consider and articulate our consideration of medical opinions and prior administrative medical findings, revising who can be a medical consultant (MC) and psychological consultant (PC), revising our rules about treating sources, and reorganizing our evidence regulations for ease of use. These proposed revisions conform with the Bipartisan Budget Act of 2015 (BBA), reflect changes in the national healthcare workforce and in the manner that individuals receive primary medical care, simplify and reorganize our rules to make them easier to understand and apply, allow us to continue to make accurate and consistent decisions, and emphasize the need for objective medical evidence in disability and blindness claims.

     OMB has to approve the NPRM before it is published in the Federal Register. The public can then comment upon it. The agency must "consider" the comments but the "consideration" is generally limited to giving a brief explanation of why they don't agree with the comment unless the comment has to do with something as minor as punctuation. After that process is finished, the final regulation goes back to OMB and then into the Federal Register again after which it goes into effect. However, we'll have a new President and Commissioner before this happens.

We're Number Six!

     The Partnership for Public Service's rankings of the best places to work in the federal government, among large agencies, based upon Office of Personnel Management surveys:

1	National Aeronautics and Space Administration	76.1	74.6	1.5
2	Intelligence Community	67.1	67.9	-0.8
3	Department of Justice	66.3	63.8	2.5
3	Department of State	66.3	68.2	-1.9
5	Department of Commerce	66.2	68.7	-2.5
6	Social Security Administration	66.0	63.2	2.8
7	Department of Health and Human Services	63.9	61.8	2.1
8	Department of Labor	63.1	58.7	4.4
8	Department of Transportation	63.1	60.4	2.7
10	Department of the Air Force	60.0	56.8	3.2

Don't Spend It All In One Place

     Social Security's Office of Chief Actuary is estimating a cost of living adjustment (COLA) this year between 0.0% and 0.7% with the intermediate estimate being 0.2%.

Budget Cuts Threaten Furloughs At Social Security

     From a press release (emphasis added):

The American Federation of Government Employees (AFGE) National Council of SSA Field Operations Locals (NCSSAFOL) is warning the public and Social Security beneficiaries of the danger of the U.S. House of Representatives Appropriations Committee's decision to cut President Obama's proposed budget request for the Social Security Administration (SSA) by $1.2 billion, $263 million below the Fiscal Year 2016 spending level.

Witold Skwierczynski, President of the NCSSAFOL, states that the House budget cuts will result in a ten-day furlough of all SSA workers, an agency-wide hiring freeze, a reduction in local field office hours, permanent closing of many field offices, increases in wait times on SSA's National 800 number and field offices, and an increase in processing times for benefits. ...

The AFGE National Council of SSA Field Operations Locals represents 28,000 employees in 1250 Social Security field offices  and 28 Teleservice Centers across the country, including Puerto Rico, and the Pacific Islands.

Eanes Nomination Stalled

     I don't know what's going on but there's been no action on the Senate floor on the nomination of Andrew Lamont Eanes to become Deputy Commissioner of Social Security even though the nomination was reported out of the Senate Finance Committee almost three months ago. At this point, it's not clear that the Senate is willing to act on any Obama nominee.

Why Is This Legal?

     From an accounting firm's newsletter:

The federal self-employment (SE) tax just keeps going higher and higher. [No, apart from a cost of living adjustment in the earnings base, it hasn't changed in many years.] If you've reached the breaking point, there may be a way to tame the SE tax beast by converting your existing unincorporated small business into an S corporation. ...

So it may be time to consider an S corporation conversion. Reason: The SE tax doesn't apply to earnings from an S corporation business. 

The FICA tax is only due on an S corporation shareholder-employee's salary. So when the company pays only a portion of its profits to the owner, or owners, in the form of a reasonable salary, with the remaining portion paid out in the form of cash distributions, only the salary portion is hit with Social Security and Medicare taxes (in the form of the FICA tax). The profits paid out as cash distributions are exempt from the FICA tax (and exempt from the SE tax too)....

Thanks, Trump

     The Social Security field office in downtown Cleveland will be closed this week because of the Republican national convention.

People Cut Off Social Security Disabilty Benefits Struggle

     And these are claimants that Social Security has found to be medically improved.

The Cost Of Budget Cuts