Washington Post on SSA Budget Problems

From the Federal Diary Column by Stephen Barr in today's Washington Post:

The Social Security Administration would be forced to send employees home without pay and shut offices 10 days next year if Congress does not increase its funding in fiscal 2007, the agency has told Congress.

"Fewer resources mean fewer people to serve the public in all areas of SSA's operations," Jo Anne B. Barnhart , the Social Security commissioner, said in a letter to the Senate Appropriations Committee. "Because these budget reductions will affect all employees, they will result in major service disruptions across all workloads."

If the agency resorts to furloughs, the Social Security network of 1,300 field offices would close, probably a day at a time over a five- to six-month period. On those days, the public would not be able to apply for Social Security numbers, replace Social Security cards, file for retirement or disability benefits or obtain decisions on pending disability claims and appeals. ...

"For an agency like ours, it is kind of a shock," said Richard Warsinskey , president of the National Council of Social Security Management Associations.

Warsinskey said he understands that companies lay off and furlough employees in bad economic times, "but this is a public service issue." He said, "We don't want to take a well-run agency and make it mediocre because we don't get enough money."

Mark Lassiter , the Social Security press officer, said no decisions on furloughs have been made. The House and Senate have not finished work on the agency's budget and Barnhart "remains hopeful that the president's budget request will be approved by Congress," he said.

The Senate bill would provide about $9 billion for the agency -- about $400 million less than the president's request and about $54 million less than what the agency received for this year's budget. The House proposal would leave Social Security about $200 million short of what the White House is seeking.

The agency's budget may not be resolved until after the November elections, congressional aides said. A spokeswoman for the Senate Appropriations Committee said House and Senate negotiators would review the agency's funding and staffing levels later this year. Many agencies are likely to face budget squeezes next year, in part because Congress faces tough decisions on financing the Iraq war and homeland security.

Social Security, headquartered in Baltimore, has about 65,000 employees, and officials estimate that more than 40 percent of its workforce will retire by 2014. It appears that not all departing employees will be replaced because of budget pressures. Only one employee is being hired for every three that depart, according to 2006 and 2007 budget plans.

Darryl Perkinson , president of the Federal Managers Association, said reduced appropriations for Social Security will probably worsen the backlog of cases in the agency's Office of Disability and Adjudication Review. The association estimates the backlog has grown to 730,000 cases with an average processing time of 481 days. The group is urging Congress to pass the president's budget request and support adequate staffing levels in the disability review office. ...

In her letter, Barnhart indicated that the Senate's proposal to provide $400 million less than in the president's budget would require a hiring freeze, overtime reductions and other overhead cuts in addition to a 10-day furlough of staff. ...

Arkansas DDS Director Criticized

WREG-TV reports that Arthur Boutiette, the director of Arkansas Disability Determination Services which makes decisions on Social Security disability claims, has been drawing a salary of $110,197 a year, even though the maximum salary for his job is supposed to be $89,923. The higher salary was achieved by paying Boutiette as a medical consultant, even though he is not any sort of medical consultant.

NPRM On Privacy

The Social Security Administration has published a Notice of Proposed Rule Making (NPRM) in the Federal Register on privacy and disclosure of official records. At first reading there is nothing new in the NPRM that should be controversial. Perhaps the only thing that might cause a problem is the following language:

§ 401.100 Disclosure of records with thewritten consent of the subject of the record.
(a) General. Except as permitted by the Privacy Act and the regulations in this chapter, or when required by the FOIA, we will not disclose your records without your written consent.
(b) Disclosure with written consent. The written consent must clearly specify to whom the information may be disclosed, the information you want us to disclose (e.g., social security number, date and place of birth, monthly Social Security benefit amount, date of entitlement), and, where applicable, during which time frame the information may be disclosed (e.g., during the school year, while the subject individual is out of the country, whenever the subject individual i receiving specific services).
(c) Disclosure of the entire record. We will not disclose your entire record. For example, we will not honor a blanket consent for all information in a system of records or any other record consisting of a variety of data elements. We will disclose only the information you specify in the consent. We will verify your identity and where applicable (e.g., where you consent to disclosure of a record to a specific individual), the identity of the individual to whom the record is to be disclosed.
(d) A parent or guardian of a minor is not authorized to give written consent to a disclosure of a minor’s medical record. See § 401.55 (c)(2) for the procedures for disclosure of or access to medical records of minors.

If applied too literally, this could make the job of an attorney representing a Social Security disability claimant more difficult, since the mere appointment of the representative would not be enough to authorize the attorney access to the client's records at Social Security. A separate, detailed authorization would be required for each disclosure. It is unlikely that this was intended.

This is only a proposal. The public can comment on the proposal until November 13, 2006.

Oral Appeals Nixed

From today's Federal Register:

We are withdrawing the notice we published in the Federal Register Notice on August 14, 2006. That notice explained that the Agency intended to expand the methods available for requesting administrative review by accepting oral requests from claimants in person or by telephone. In developing the business process, we discovered this change would not provide the same protections to the claimant that exist in the current process. As a result, we have determined that we will not change the appeal process in this manner at this time.

DATES: Effective Date: This withdrawal will be effective on September 12, 2006.

Oral Appeals To No Longer Be Allowed

A few weeks ago Social Security stunned many of its own employees with a notice that it would accept appeals filed orally. The agency had long demanded that all appeals from its decision be filed in writing. The decision to accept oral appeals went against long establised procedures and seemed unworkable, even to attorneys who represent Social Security claimants on these appeals. Social Security has now filed a new notice to be published tomorrow that will rescind the right to file appeals orally. Here is the item from the Office of Federal Register:

Social security benefits and supplemental security income:

Determination or decisions; administrative review requests; additional options; withdrawn, E6-15055

SSA Press Release on September 11, 2001 Attacks

From Social Security's Press Office:

• Social Security is America’s family protection plan. It is more than a retirement program; it provides valuable survivors and disability protection for workers and their families.

• As a result of September 11^th, Social Security received 5,797 individual benefit claims from 2,428 families. Most of the assistance went to family members of those killed in the terrorist attacks. However, Social Security also helped workers get disability and retirement benefits.

• Survivors Benefits: When a worker dies, certain surviving family members may be eligible for benefits. Social Security has paid monthly benefits to 2,377 surviving children and 853 surviving spouses. In addition to monthly benefits, one-time payments were made to 1,802 members of victims’ families.

• Disability Benefits: When a worker is unable to work due to a disability that lasts or may be expected to last at least one year or to result in death, the disabled worker and certain family members may be eligible for Social Security disability benefits. Social Security has paid monthly benefits to 642 individuals disabled by the terrorist attacks of September 11^th and 99 of their dependent spouses or children.

• Nearly $175 million in benefits have been paid to people affected by the September 11^th tragedies.

• The first payments to surviving family members (benefits for the month of September) were paid on October 3, 2001.

• As of August 2006, Social Security is paying more than $2.9 million per month.

• Social Security responded to the September 11^th terrorist attacks by activating special emergency procedures to give the fastest possible service to the families of the victims of the tragedies at the World Trade Center, the Pentagon and in Pennsylvania.

• These procedures allowed for acceptance of documents as proof of death that, under other circumstances, would not have been accepted. Airplane manifests, lists of employees furnished by employers and other statements that placed the worker at the scene of the attacks were accepted.

• Social Security employees helped families at special assistance centers that were established in New York, Arlington, VA, and Shanksville, PA.

Attorney Fee Payments Up In August

After taking a big dip in July, payments of fees to attorneys and others for representing Social Security claimants went up significantly in August:

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
August-06	24,579	$85,528,548.61

Social Security Budget

From the president of the American Federation of Government Employees, a union that represents many Social Security employees:

Over the last two years, news about Social Security has been anything but good. Last April, the Social Security Board of Trustees released its annual report. The report estimated that the trust fund would be exhausted a year earlier than previously thought, in 2041, at which point the Social Security Administration would pay out 74 percent of today's promised benefit amounts. Yet a sound plan to shore up the trust fund has not materialized.

Another problem also threatens Social Security's fiscal integrity. In March 2006, SSA's Office of Inspector General reported to the Senate Finance Committee that SSA overpaid individuals receiving disability benefits an estimated $5.1 billion in funds to which they were not entitled. That report provided data on top of a September 2004 Government Accountability Office report, which also stated that SSA grossly overpaid disability benefits to ineligible recipients.

What's the connection between the overpayment reports and the bleak future of the Social Security trust fund? Fiscal irresponsibility on the part of the Bush administration and the Republican-controlled Congress, for not properly funding SSA's staffing and administrative budget. Social Security's problems are the result of poor financial planning and an adherence to an ideological disdain toward "big government."


In the Inspector General and GAO reports, SSA is faulted for not having the means to detect and prevent overpayments to disability beneficiaries whose medical conditions improved, who performed substantial work activity despite their impairments, or who were ineligible for other nonmedical reasons.

Both reports cited estimates by SSA actuaries that the agency would save $10 for every $1 spent performing disability case reviews. SSA responded to the reports by stating it created and implemented new automated systems to develop and adjudicate those reviews. However, the reality is that SSA does not have the staffing levels necessary to process those reviews, even with new tools, and still take and process the millions of benefit claims, Social Security card applications and post-entitlement issues the agency receives every year. In fact, SSA has stopped performing certain types of reviews altogether, citing lack of funding.

Each year, SSA submits a budget which the White House and Congress pare down. This year, SSA is facing further cuts in its administrative budget, which means fewer employees. Couple personnel cuts with a looming federal employee retirement rush, and there will be a human capital crisis, which will cause more wasteful overpayments and detrimentally impact public service. Longer waiting times in offices and over the phone, as well as significantly increased processing delays, will result.

The math is very simple. If $10 are saved for every $1 spent on reviewing disability cases and investing an additional amount equal to 10 to 20 percent of the overpaid $5.1 billion for new frontline staff for SSA, then the savings generated by promptly reviewing, detecting and preventing future overpayments would more than pay for the cost of hiring more employees. The trust fund would be better protected. Furthermore, waiting times and processing delays would be dramatically reduced, and the human capital crisis would be averted, thus protecting and improving service to the American public in more than one way.

To right-wing ideologues in Washington, D.C., increasing SSA's staff would look like embracing "big government." They have deluded themselves into thinking that SSA, one of the most popular and visible agencies in the federal government, can "do it all" with a shrinking budget. However, the truth is that the status quo will mean more wasted trust fund dollars and a steady erosion in the quality of SSA's public service.

The White House and Congress have a choice. They can either choose to act in a fiscally prudent manner by investing in SSA, or they can continue to allow the Social Security trust fund to hemorrhage more tax dollars due to a far-from-adequate budget.