Workers Compensation Offset Errors Estimated At $149 Million

A recent study by Social Security's Office of Inspector General sampled Social Security's worker's compensation offset determinations. In general, Social Security disability benefits are reduced if a claimant is also receiving workers compensation benefits. The computation of the offset can be complicated. The study showed a high level of errors, with most of the errors shortchanging claimants. The amount of money involved is staggering. Here is a table from the study:

Summary of Sampling and Estimation Results for WC Related Errors

Error Category	Sample – Error Claims		Estimate to Population
	Claims	Dollars	Claims	Dollars
Underpayments	19	$118,386	17,858	$111,268,016
Overpayments	8	$40,204	7,519	$37,786,614
Totals	27	$158,590	25,377	$149,054,630

Inspector General Wants Priority Processing For Cessation Cases

From a report by Social Security's Office of Inspector General:

We found that 53 percent of individuals in our population, who appealed a medical cessation decision and continued to receive payments throughout the appeals process, were overpaid. The overpayments were increased because SSA’s process for deciding medical cessation appeals is not financially efficient. Medical cessation appeals should not be processed in the same manner as cases not receiving payments. Therefore, to the extent possible, appeals that involve benefit payments should be processed separately from those that do not involve payments to avoid or minimize overpayments.

The President’s Management Agenda introduced the initiative of improved financial performance throughout Government agencies. By making SSA’s process for medical cessation determinations more efficient it would be better aligned with the President’s vision. If SSA would develop a process for making decisions on medical cessation appeals in a timely manner, financial performance of the DI program could be greatly increased.For example, if SSA decreased the processing time on medical cessation appeals (both reconsiderations and ALJ hearings) to 165 days, we project overpayments of approximately $30 million could have been avoided for FY 2003 and 2004. Based on the average of these 2 years, we estimate SSA could have avoided about an additional $15 million in overpayments in FY 2005.

Astrue Nomination Reported Favorably By Senate Finance Committee -- And More On Social Security Budget

This is the text of a press release from Senator Max Baucus, Chairman of the Senate Finance Committee (emphasis in original):

Washington, DC – In a vote off the Senate floor this afternoon, members of the Finance Committee favorably reported to the Senate the nomination of Michael Astrue to head the Social Security Administration. At Astrue’s nomination hearing this month, Finance Committee Chairman Max Baucus (D-Mont.) obtained a commitment from the nominee to “stay out” of political debates over the future of Social Security, including any rehashing of failed privatization schemes. Also today, Baucus applauded the news that the 2007 continuing resolution will restore $200 million in administrative funds to the Social Security Administration (SSA). Baucus has strongly urged the restoration of funds to SSA to prevent backlogs for disability benefit claims from getting worse, and to ward off expected staff furloughs that could have caused service disruptions.

“The next Social Security Commissioner will inherit a slightly brighter budget picture than was envisioned for this year,” said Baucus. “The continuing resolution still doesn’t give Social Security all the operating funds it needs, but at the very least we won’t see the 10-day staff furlough that was feared. Congress can’t forget that funding cuts to Social Security have a direct effect on the well-being of Social Security recipients and applicants. I will keep working to restore full administrative resources to Social Security in the coming year.”

A White House budget request in February of 2006 contained $9.59 billion in 2007 operating funds for Social Security Administration. During congressional consideration of the budget, that amount was reduced by $400 million, creating financial constraints for SSA.

Baucus Commends Former Commissioner Barnhart

Senator Max Baucus, the Chairman of the Senate Finance Committee, which has jurisdiction over the Social Security Administration has issued a statement commending former Commissioner of Social Security Jo Anne Barnhart.

More Evidence Of Social Security Staffing Problems

The National Conference of Social Security Management Associations (NCSSMA) is an organization of Social Security management personnel. They post online the minutes of their meetings. Those minutes give a fascinating insight into the problems faced by Social Security's frontline personnel. The minutes of their January 17, 2007 teleconference have been posted. This sounds awfully boring, but if you are interested in what is really going on at Social Security, these minutes are fascinating.

Here is NCSSMA's discussion of service backlog issues:

Carla asked about whether Congress has commented about the service backlogs. She is seeing an increase in the number of congressional inquiries her office receives. ...

Hugh Stempfley related information about a conference call conducted in Illinois between SSA, represented by CO [Central Office], Chicago RO [Regional Office], and many district managers and congressional staff members from Senator Obama and Senator Durbin’s offices. The call lasted two hours and the focus was on how offices are losing staff without being able to replace them and how the loss of staff has negatively impacted service in the field offices. All concerned concluded that we have resource issues in the field offices right now.

Rick mentioned that he had a call from a manager today who pointed out that the public has an increased expectation of field office service levels but our staffing levels continue to decrease. This is a problem we are seeing in field offices and teleservice centers across the country.

Charlotte Observer On Disability Backlogs

The Charlotte Observer has an article on backlogs in adjudicating disability claims at Social Security. The report that about 20% of clients at a homeless shelter are awaiting action on Social Security disability claims is sobering.

The reporter misunderstood something that I said. I did not tell him that five to six of my clients die each year. I told him that something like five to six of my firm's clients die each year. My firm has six lawyers doing Social Security representation full time.

Budget Picture -- Bad, But Not As Bad As I Thought

An informed source tells me that I was not reading the continuing resolution accurately, or, perhaps, that it is much more complicated than I thought. I will quote from an e-mail I received from this informed source:

A few hints on what you need to look at. The number quoted on page 78 does not include the SSI user fee which is around 117 million. See the SSA appendix. Also there will probably be around another 40 million for SSA salaries and benefits (see page 8 and 9 of CR). Total will be very close to what House approps recommended. This is why Obey's office could put this out:

"...Most programs are funded at FY 2006 levels with increases to cover the cost of pay increases. Necessary additions are made to maintain staffing levels, avoid furloughs, and generally meet increased costs or workloads for agencies most notably: the Department of Justice, the Judiciary, the Social Security Administration, the FAA (including air traffic control), International peacekeeping operations, the Indian Health Service, the Food & Drug Administration, and the USDA Food Safety Inspection Service.

http://appropriations.house.gov/News/pr_070129.shtml

The House amount is right on the line of missing a furlough but leave SSA with a virtual hiring freeze this year which will still be very hard on the Agency.

Budget News Is Bad

The chairmen of the House and Senate Appropriations Committees have released their proposed continuing funding resolution for fiscal year 2007. Hidden inside this lengthy document is §20645(a), which calls for a Social Security budget of $9.137 billion. The President's budget for FY 2007 had called for a $9.496 billion budget for Social Security's administrative operations. Even that much higher budget would have resulted in a loss of 2,545 full time staff positions. The actual FY 2006 budget was $9.109 billion, as best I can tell, which would indicate only a 1% increase for FY 2007 over FY 2006. The FY 2006 level was the funding level provided in the last continuing funding resolution and that was predicted to require furloughing all Social Security employees for 10 days. Is $28 million more enough to prevent employee furloughs at Social Security? Certainly, it is not enough to prevent significant further deterioration in service at Social Security. There may be efforts made to amend this continuing resolution, either in committee or on the floor of the Senate. Everything must all happen rapidly, since the current continuing funding resolution runs out on February 15.