Social Security Budget

According to a Senate Appropriations Committee summary Social Security's budget for fiscal year (FY) 2007, which begins on October 1, 2006, has already been reported out of committee in both the House of Representatives and the Senate. Social Security's budget is part of the Labor/HHS/Education Appropriation bill It has not yet come up on the floor in either house of Congress.

Here is the portion of the Senate Appropriations Committee Report dealing with Social Security.

Appropriations, 2006 1	$9,108,606,000
Budget estimate, 2007	9,494,000,000
House allowance	9,293,000,000
Committee recommendation	9,093,000,000
1 Excludes $38,000,000 in emergency supplemental appropriations enacted pursuant to Public Law 109-234.

The 2007 budget estimate is the amount recommended by the President. The House of Representatives cut that dramatically and the Senate is threatening to cut it even further.

The Senate Report includes the following language:

The Committee encourages SSA officials to educate adjudicators at all levels about the functional impact of CFS and the application of the April 1999 CFS ruling (99-2p) to ensure that adjudicators remain up to date on the evaluation of disability that results from this condition. The Committee encourages SSA to examine obstacles to benefits for persons with CFS and to keep medical information updated throughout all levels of the application and review process.

Stark Warning On Social Security Budget

Jo Anne Barnhart, Commissioner of Social Security, sent the following letter to Senator Robert Byrd, the Ranking Minority Member of the Senate Appropriations Committee on July 19:

I am writing to express my concern about the impact the funding included for Social Security in the Labor, Health and Human Services, Education and Related Agencies Appropriations bill will have on Social Security employees and service to the public. The subcommittee mark provides $9.093 billion to the Social Security Administration (SSA) for administrative expenses in Fiscal Year (FY) 2007. This represents a $401 million reduction from the President's FY 2007 request and is $54 million belowe the FY 2006 appropriation level.

This $401 million reduction means SSA would need to cut an additional 4,000 workyears beyond the budgeted 1 for 3 replacement level in FY 2006 and FY 2007. After implementing a staffing freeze and reducing overtime to minimum operating levels in SSA and the Disability Determination Services, achieving a $401 million reduction would require employee furloughs of approximately 10 days Agency-wide.

Without this funding, SSA will reduce the number of continuing disability reviews (CDRs) processed by 486,000 from a planned level of 597,000 to 111,000. CDRs save $10 for every $1 spent administering them, so this reduction would result in a significant increase in Federal spending.

SSA's administrative expenses are used to pay for the people needed to do the work, so fewer resources mean fewer people to serve the public in all areas of SSA's operations. Because these budget reductions will affect all employees, they will result in major service disruptions across all workloads. These include delays in the public's ability to file for retirement or disability benefits, apply for a replacement SSN card, reach a representative on our 800-number or obtain decisions on pending disability claims and appeals.

I appreciate the support you and Congress have given SSA in the past. However, as Commissioner of Social Security, I believe it is my responsibility to inform you that this reduction is too large and will result in furloughs and service reductions. Once again, I hope I can count on your support for the President's request for SSA. Please do not desitate to contact me or have your staff contact Mr. Dale Sopper, Deputy Commissioner for Budget, Finance and Management at (410) 965-2914.

Sincerely
Jo Anne B. Barnhart

OIG Newletter

Social Security's Office of Inspector General (OIG) has issued its Summer 2006 newsletter, which contains, among other things, accounts of several criminal convictions for Social Security fraud that OIG obtained.

Number of Employees At Social Security

The Office of Personnel Management has an on-line database that tracks the number of employees by agency. Here is some data on the number of SSA employees as of certain months over the last few years:

September 1998 65,629
September 1999 63,957
September 2000 64,521
September 2001 65,377
September 2002 64,648
September 2003 64,903
September 2004 65,238
March, 2006 64,297

What this shows is that Social Security employment has remained relatively constant -- in the face of what is almost certainly the largest increase in the agency's workload since the 1930s, as baby boomers age into their prime years for disability claims. Disability claims are only a small fraction of the benefits paid by Social Security but account for more than half of Social Security's workload.

Nurse Case Manager Job Duties

The number of people being hired in the Disability Service Improvement (DSI) experiment as nurse case managers just for Region I -- 90 -- plus the job title, which is the term used in workers compensation and long term disability cases for personnel who often have an adversarial relationship with claimants leads to some concern about what Social Security is up to with Nurse Case Managers. Social Security has published a job announcement for more personnel to be hired for this position. The announcement gives the following job description:

Provides expert medical policy, procedural, and technical advice and guidance to DDSs, ROs, ALJs, the DRB, OQP and the national network of experts affiliated with the OMVE on the most complex issues encountered in making the determination or decision in a disability claim. This technical advice and guidance includes confirming what medical, psychological and vocational expertise is needed as well as verifying the need for additional medical or lay evidence, tests, or a consultative examination. Verifies that the request is in accordance with disability law, regulations, and policy.

Serves as a medical program expert and technical authority by providing technical advice on medical disability program issues, concerns, initiatives and requirements. Provides oral and written reports and conducts briefings on behalf of the Director to other SSA central office and regional components.

Provides expert medical advice and guidance for cases with multiple impairments to the DDSs, ROs, ALJs, DRB, OQP and the national network of medical and vocational experts.

This job description does not suggest that the Nurse Case Managers will have any direct contact with claimants, but it does suggest that the Nurse Case Managers may play something of an advocate's role in the process. They could be present at ALJ hearings, by video, to explain why the prior decision denying the claim was right. Still, the job description raises as many questions as it answers.

There is a worrisome history behind the idea of "case management" in the Social Security disability programs. The first recommendation that Social Security ought to have case managers that I can find came from Patricia Owens, formerly head of the Office of Disability Operations at Social Security and more recently an advisor to UNUM, the nation's largest Long Term Disability (LTD) insurer. She was pushing "case management" in 1999 in testimony to the House Social Security Subcommittee and she clearly had in mind people who would find a way to get claimants back to work, or at least off Social Security disability benefits.

The General Accounting Office, now the Government Accountability Office (GAO), picked up on this. The GAO testified, approvingly, in 2000 to the House Social Security Subcommittee about the practices of private long term disability insurance companies who were using nurse claim managers, among other personnel, to "encourage" recipients of long term disability (LTD) benefits under employee pension plans or under private insurance plans to return to work. GAO rehashed much the same subject in an early 2001 report. In 2002, in a report on disability determination at both Social Security and VA, GAO again urged "case management." None of the GAO reports acknowledged that the return to work "encouragement" was often perceived by the LTD recipients as harrassment aimed at lowering resistance to termination of benefits or that, in general, the insurance companies' handling of LTD claims has been extremely controversial in recent years.

July Fee Payments Down Sharply

Social Security has released monthly statistics on fees paid to attorneys and others for representing claimants before the agency. The fees come out of the back benefits of the claimants. Fee payments fell by 24% in July, 2006 as compared to June, 2006 and fell by 14% as compared to July 2005.

Fee Payments
Month/Year	Volume	Amount
Jan-06	18,752	$64,848,326.02
Feb-06	20,426	$70,312.586.15
Mar-06	26,227	$91,045,934.83
Apr-06	23,042	$79,714,961.76
May-06	23,581	$82,015,869.29
June-06	27,771	$97,085,724.60
July-06	21,432	$74,648,883.83

Bush Keeps Talking About Privatizing Social Security

It is hardly news anymore that President Bush speaks every chance he gets about privatizing Social Security. This is from a statement by the President at a bill signing on Thursday:

To ensure more secure retirement for all Americans we've got more work to do. We must also prepare for the impact of the baby boomer generation's retirement, and what that impact will have on federal entitlement programs like Social Security and Medicare. As more baby boomers stop contributing payroll taxes and start collecting benefits -- people like me -- it will create an enormous strain on our programs. Entitlement programs are projected to grow faster than the economy, faster than the population and faster than the rate of inflation. If we fail to act, spending on Social Security and Medicare and Medicaid will be almost 60 percent of the entire federal budget in the year 2030. And that's going to leave future generations with impossible choices: staggering tax increases, immense deficits or deep cuts in benefits.

We have an obligation to confront this problem now. The Secretary of Treasury understands what I'm telling the Congress: Now is the time to move; now is the time to do our duty. I'm going to continue to work with the Congress and call on the Congress to work with the administration to reform these programs so we can ensure a secure retirement for all Americans.

State Bar Of Michigan Social Security Newsletter

The Social Security Section of the State Bar of Michigan has issued its Summer 2006 newsletter. What may come as a surprise to attorneys in other states is that the Grand Rapids Hearing Office still copies Social Security files for attorneys who have hearings with that office.