What Happened Here?

From the Kingman (AZ) Daily Miner:

A lot of things can be lost in the red tape of bureaucracy.

What Kingman resident Deanene L. Greenwood didn't expect was her life.

Greenwood, 50, came to the sudden realization roughly 10 months ago that her checks were bouncing.

When she contacted her bank, they notified her that her checks from the Social Security Administration were no longer being deposited into her account.

"My initial thought was they just transposed numbers," Greenwood said. "I really just thought it was a typing error."

With a little detective work, otherwise known as repeated calls, Greenwood said a representative with the administration told her that she had never received benefits and wasn't in their system.

Through all the calls, Greenwood said she didn't record or recall the names of the individuals she spoke with.

After a few more calls, Greenwood said a representative with the administration told her that she was listed as deceased.

Greenwood said in April 2005 she started receiving disability benefits from the administration.

She added she was also receiving payment for her two juvenile children through benefits her deceased husband had obtained.

Roughly 18 months ago, Greenwood applied for and received retirement benefits from the Social Security Administration.

Greenwood added they made her choose between that and disability, so she chose the greater retirement check. She was unable to provide documentation of this.

Greenwood said that she had packed up her paperwork, along with the rest of her belongings at her home in the 100 block of Chestnut Street because it is being foreclosed on.

Without the checks, Greenwood said she had to tap into her other resources.

"I've gone through all my savings," Greenwood said. "I've gone through the savings I had for my two children's education."

Around three months ago, she ran out of funds. Utilities were turned off at the residence.

Greenwood said she agreed to put her twin 16-year-old sons in voluntary hardship placement when Child Protective Services contacted her. During her time of need, Greenwood said that she has received support from the St. Vincent de Paul Society and the Salvation Army.

Without transportation and tired of trying to make something happen over the phone, a friend took Greenwood to the administration's office in Prescott.

Greenwood said three months ago she reapplied for disability and retirement payments. She added they told her it would take between two to three months before she received notification of her status.

Social Security Administration Spokesperson Lowell Kepke said they never reported Greenwood deceased. He added they had never given her retirement benefits in the past.

Kepke did say Greenwood was receiving checks for the children of her deceased husband. He added they stopped sending the checks when she no longer had custody of them.

Kepke said the state of Arizona is currently processing her new claim for disability benefits. He added it is impossible to put a time line on how long it would take to process.

"I'm not trying to get disability," Greenwood said when told of Kepke's comments. "I'm trying to get my retirement back."

Greenwood said she applied in person for both and doesn't understand why her application for retirement benefits wasn't mentioned.

"Once you retire, you're retired - supposedly," Greenwood said.

I cannot tell exactly what happened here. Ms. Greenwood is almost certainly mistaken about some important details, but I strongly suspect that someone at Social Security did tell her at one point that she was listed as deceased -- probably not realizing that they were looking at her late husband's Social Security records. I also wonder whether she had been approved in the past for Disability Insurance Benefits and those benefits were, by mistake, not resumed when her Mother's Benefits ended when her children turned 16. More likely, she had been on SSI disability benefits which were ended by her receipt of Mother's Benefits and which would not have automatically restarted if she had been off them for 12 months or more.

In any case, it takes staff at Social Security to sort out this sort of problem and Social Security has an acute current staffing shortage which makes it take forever to sort out this sort of problem.

Also, by the way, the Social Security staffer who contradicted Ms. Greenwood to the newspaper reporter had no business talking with the newspaper about Ms. Greenwood's case, either to agree or disagree with her understanding of what had happened. This appears to me to have been a Privacy Act violation.

Maybe This Doesn't Seem Like A Fantasy In North Dakota

From a press release from Senator Kent Conrad:

Senators Kent Conrad (D-ND) and Judd Gregg (R-NH), chairman and ranking member, respectively, of the Senate Budget Committee, today joined forces to offer a blueprint for prompting swift, bipartisan action to substantially improve the nation's long-term fiscal condition. ...

"The retirement of the Baby Boomers will seriously exacerbate a problem that has been building for years," said Senator Gregg. ...

The Bipartisan Task Force for Responsible Fiscal Action Act of 2007 establishes a 16-member task force comprised of eight Democrats and eight Republicans, designated by Congressional leaders and the President. Fourteen members of the task force will be current Members of Congress, and the remaining two members will be from the current Administration. The Secretary of the Treasury will chair the task force. ...

It will analyze all potential solutions, and make legislative recommendations to Congress and the President on how to substantially improve the long-term fiscal balance in a report due December 9, 2008. To ensure the bipartisanship of the recommendations, at least three-quarters of the task force, or 12 members, must agree to them before the report can be submitted.

Once Congress receives the recommendations as a legislative proposal, it must be fast-tracked to final consideration in both the Senate and House. Final passage of the bill requires a supermajority in each chamber -- three-fifths of the Senate and three-fifths of the House -- which is intended to ensure strong bipartisan support.

Written Statements At Hearing On Bank Treatment Of Social Security Benefits

From the Senate Finance Committee:

Frozen Out: A Review of Bank Treatment of Social Security Benefits

September 20 , 2007, at 10:00 a.m. in 215 Dirksen Senate Office Building

Member Statements:
Max Baucus, MT
Charles Grassley, IA

Witness Statements:

Waverly Taliaferro, Social Security beneficiary, New York, NY

Sara Kelsey, General Counsel, Federal Deposit Insurance Corporation, Washington, DC

Montrice Goddard Yakimov, Managing Director of Compliance and Consumer Protection, Office of Thrift Supervision, Department of the Treasury, Washington, DC

Julie L. Williams, First Senior Deputy Comptroller and Chief Counsel, Office of the Comptroller of the Currency, Department of the Treasury, Washington, DC

Margot Saunders, Counsel, National Consumer Law Center, Washington, DC

Finding A Way To Record The Deaths Of Claimants Who Are Awaiting A Social Security Disability Hearing

It has been suggested to me that it would be a good idea if there were some way to publicly record the deaths of claimants who are awaiting a hearing before an Administrative Law Judge (ALJ) on a Social Security disability claim. There are far more of these deaths now than there used to be because of the enormous hearing backlogs. The deaths are a depressing fact of life for attorneys who represent Social Security claimants. Not a few of these deaths are suicides. Other deaths could have been prevented if the claimant could have had the Medicare or Medicaid that goes with Social Security disability benefits.

There are some technical issues of how best to publicly record these deaths. At best, we will never be able to record anything like all of them. There are also confidentiality issues for attorneys if they list their late clients' names. Still, there ought to be some way of doing this so that the public could get some rough idea of the terrible effects of these backlogs. It would be nice if we could also have these show up on a map.

If anyone has any thoughts about how we could do this, please share it with me either as a comment in response to this item in the blog or by e-mailing me.

Dow Jones Reports On Today's Hearing

Some excerpts from a Dow Jones Newswires article:

Banks should ignore state garnishment orders if the accounts in question include Social Security benefit payments or other protected federal funds, U.S. Senate Finance Committee Chairman Max Baucus, D-Mont., said Thursday. ...

The problem, however, is that while banks may want to help out their customers, refusing to obey a garnishment order puts them at risk of state fines and penalties.

As a result, Congress should consider "whether to undertake legislation that would provide financial institutions with protections from liability," Yakimov said.

Even the Social Security Administration has largely thrown up its hands, Kelsey said.

SSA recommends to beneficiaries that if a creditor tries to garnish their Social Security check, then the beneficiary should tell the creditor their benefits can't be garnished.

"In other words, the exemption provision is to be treated as a defense to be raised by a beneficiary after a freeze or hold has been placed...rather than a bar against the imposition of the freeze or hold in the first place, Kelsey said.

Baucus said that is just wrong.

ALJs Respond To Charlotte Observer Article

The Charlotte Observer recently ran an article about backlogs at Social Security's Charlotte, NC hearing office. The article implied that low productivity by local Administrative Law Judges (ALJs) was a major factor in the backlogs.

This is a charge that I find to be ridiculous. It is inevitable that when you put any group of humans to work on any type of job that there will be a bell shaped curve of productivity. It is naive to think that the fault for this backlog lies with those ALJs who are on the lower end of this productivity curve, when clearly there are not enough of the ALJs and their support staff to get the job done. We cannot repeal the basic human characteristics which lead to the bell shaped curve of productivity. We must hire enough people to get the job done.

Making the same point in a different way are ALJ Randall Frye of Charlotte and Ronald Bernoski, the President of the Association of ALJs, in a response piece that is running in the Charlotte Observer. Here are some excerpts:

...As late as the 1990s, SSA had no significant disability case backlog. Today, the number of cases waiting to be heard exceeds 750,000. Yet the number of judges who handle these cases has remained static -- and the number of support staff has actually decreased.

According to figures released by SSA Commissioner Michael Astrue in FY 2006, administrative law judges handled 550,000 disability cases -- a level that exceeded the agency's own goals. ... In Charlotte in 2006 (the last year for which statistics are available), the disability court [court?] exceeded the agency's 100 percent standard by a full 17 percentage points. ...

FY 2009 Budget Decisions Coming Soon

The Social Security Administration must release its Fiscal Year (FY) operating budget request for FY 2009 (which begins on October 1, 2008) in early 2008. Unlike all other agencies, Social Security is not only allowed, but required, to release its own budget request directly to Congress and the American people. The White House's Office of Management and Budget (OMB) makes its own budget recommendation for Social Security, but cannot censor the release of Social Securitys' own budget request.

For FY 2008, the Social Security Administration, then headed by outgoing Commissioner Jo Annne Barnhart, asked for far more than what was in the OMB budget. As soon as he came on board, Michael Astrue, the current Commissioner of Social Security, disavowed his own agency's budget request, repeatedly telling a somewhat skeptical Congress that he was asking only for the lower OMB budget for his agency.

There is some justification for Astrue's action. President Bush has threatened to veto any budget bill that is greater than the OMB proposed budget. There is enough Republican support for Bush to prevent a veto override. Thus, by asking only for the OMB budget, Astrue was trying to prevent a prolonged budget struggle, not that Astrue's action mattered, since it appears likely that there will be a prolonged struggle over the FY 2008 budget anyway, although the dispute has more to do with other agencies whose budgets are included in the same bill.

Unlike the FY 2008 budget, President Bush's power over the FY 2009 budget is almost non-existent. He can veto anything that Congress passes for FY 2009, but Bush will be out of office long before the end of FY 2009. Congress can easily pass continuing funding resolutions to keep the government going until Bush leaves office and then pass a budget in early 2009 which Bush cannot influence.

This leaves the question of what Michael Astrue will do about the FY 2009 budget. Will he be a loyal Republican operative and refuse to ask for a penny more than the OMB is willing to allow, thus proving that he lacks any independence from the White House, or does he ask for what he really thinks the agency needs, which we can be sure is much more than OMB will recommend? Astrue's budget recommendation makes far more difference with Bush a lame duck. An agency is unlikely to get more money than it asks for.

I do not believe that I am jumping the gun by asking about the FY 2009 budget. My understanding is that agencies are required to provide OMB with their budget requests by mid-September of each year. OMB then gives each agency a "passback" showing what they will allow. Astrue must then decide either to go public with what his agency really needs or buckle under and be a good Republican operative and tell the world that all his agency needs is what OMB has allowed. See Budget Analyst for a much more complete description of the budget process, although Social Security has a unique situation not described there.

Benefit Cards Coming

From American Banker, although I do not have a link to the article:

The Treasury Department wants to convert millions of Social Security benefit payments currently made by checks into prepaid debit cards.The department's Financial Management Service began soliciting bids Sept. 4 from banks to administer the prepaid card program, which would begin in January and take no more than six months to roll out nationwide. ...

The cards would act like a typical debit card with PIN and signature capacities. They would carry a Visa or MasterCard logo on the front and the bank's logo likely on the back. The payments would occur automatically each month, and recipients could access their funds through automated teller machines and point of sale terminals.

The recipients would decide for themselves whether to shift their payments from checks to cards. "Since we're just introducing this product we don't want to make it mandatory right away," she said. "We don't necessarily want people to use a card if they don't want a bank account." ...