Overpayment Waiver Study

Social Security's Office of Inspector General (OIG) has done a study of decisions on waivers of overpayments and has decided that SSA is granting too many waivers. The problem with the study is that while OIG gives details on how it selected cases to review, no details are given on how OIG decided that the incorrecte decisions were made. It is unclear whether OIG personnel doing the study had enough knowledge and experience to second guess anyone on waivers or whether OIG was willing to acknowledge that some cases were close calls in which it would be inappropriate to say a mistake was made even if someone working in OIG would have made a different decision. The study does not mention the bias problem inherent in having personnel at OIG decide whether other SSA personnel have erred, when the jobs of the OIG personnel are justified by finding "mistakes" made by other components of SSA.

Monthly Statistical Summary

Social Security has published its monthly statistical summary.

The Crime Beat

The U.S. Attorney's office in Boston has announced that a Gloucester, Massachusetts man has been convicted of taking $116,000 in Social Security benefits paid to his mother after her death.

Attorney Fee Stats for January

Social Security has posted the attorney fee payment numbers for January. $64,848,326.02 was paid in attorneys' fees in January 2006, down 12% from December 2005.

Rumors

According to people posting on the ALJ Improvement board, rumors are circulating within SSA that budget problems mean that no new ALJs will be hired this year and that there may be no Reviewing Officers hired either. If these rumors are true, backlogs will worsen at OHA and the Commissioner of Social Security's plan to revise Social Security's appeals process can make little progress, if any. With Barnhart's term ending in January 2007, this could be the death knell for her plan, if she is not reappointed for a second term as Commissioner.

Social Security Subcommittee Hearing

The House Means and Means Committee's Subcommittees on Social Security and Oversight will hold a joint hearing on February 16 dealing with wage reporting issues.

More Action Needed on Budget Reconciliation?

The Budget Reconciliation bill that affects payment of SSI back benefits was signed by the President on February 8. The bill had passed in Congress by the barest of margins. Now, there is news of a possible technical problem with the bill which may require additional Congressional action. As controversial as the bill was and as hard as it was to get passage, this is bad news for the President and Republican leaders in Congress. The following is from a Reuters report:

But hours after Bush signed the measure [budget reconciliation], a Senate aide told reporters that a clerical error written into the bill as it bounced between the House and Senate could mean it may need another vote.

Disability Benefits and Private Accounts -- Can They Co-exist?

The Boston College Center for Retirement Studies has published a research paper entitled "Financing Disability Benefits in a System of Individual Accounts: Lessons From International Experience." The study indicates that there are three predominate methods for dealing with disability benefits when private accounts are carved out of a Social Security system:

1. The Chilean Model, under which the capital in a newly disabled individual’s account is augmented by additional capital provided by a private insurer, such that the combined account balance is sufficient to finance a lifetime defined benefit stream prescribed by law.

2. The Swedish Model, under which government-financed disability benefits are paid up to a particular cut-off age (e.g. the retirement age, or an age close to the retirement age), and, in addition, the government finances contributions to each disabled individual’s account. Upon reaching the cut-off age, the disability benefit ceases, and the assets of the individual account are used to finance a stream of retirement income. A disabled individual’s replacement rate may increase or decrease upon reaching the retirement age, because disability benefits are defined by a formula, while old age benefits are a function of interest rates and mortality rates.

3. The Hungarian Model, under which the assets of a newly disabled person’s individual account are transferred to the PAYG system, and, in return, the PAYG system finances a lifetime defined benefit stream.