Least Discussed And Most Muddled

From The Economist:

Thomas Scully has a busy law office in Lake County, Indiana. He mainly practices disability law, with good reason. Lake County is home to steel mills. Workers have aching backs and hands warped by machinery. Mr Scully helps them win Social Security Disability Insurance (DI), which provides cash and, after two years, access to Medicare, government-subsidised health insurance meant mainly for the elderly. DI is not supposed to be a safety net for the jobless. “I tell clients”, Mr Scully explains, “disability insurance is not unemployment insurance.” But they should be forgiven for being confused.

Politicians like to deride expensive programmes. DI may be the least discussed and most muddled. The programme is severely strained. The number of awards has spiked in the downturn, rising 28% since 2007. This surge follows decades of growth. DI accounted for about 10% of Social Security spending in 1989 but 18% by 2009. This is not because beneficiaries are bending any rules; the real problem is that the rules are a mess.

The article goes on to make a classic argument about the Social Security program which I will paraphrase: "It's much easier to get disability benefits now than it was in the late 1970s and early 1980s; therefore the program has run amok." A more sensible take would be to first examine what was going on in the late 1970s and early 1980s to determine whether that was some golden age. It was not. Disability standards were preposterously tight in those days, by far tighter than anything before or since. The problem is not what is going on now; the problem was what was going on then, but that does not make for an interesting story.

Of course, the author is right in saying that discussions of Social Security disability benefits are frequently muddled.

New CR Passes House Of Representatives

The House of Representatives has passed a new Continuing Resolution (CR) that will keep Social Security and other federal agencies going for another three weeks, to April 8. This is likely to be passed by the Senate and signed by the President. This CR continues the pain for Social Security since it will only fund the agency at last year's rate, a real problem for an agency with a rapidly growing workload.

By the time this new CR runs out, the federal government is likely to be up against its debt ceiling which will add additional pressure to the negotiations.

Obama's Advisers Split On Social Security

From The Hill:

Social Security reform is splitting President Obama’s economic and political advisers. ...

Treasury Secretary Timothy Geithner, National Economic Council Director Gene Sperling and Sperling’s deputy, Jason Furman — leading figures in the president’s economic team — are pressing Obama to cut Social Security benefits if necessary, say sources familiar with their positions.

But Obama’s political team, led by David Axelrod, David Plouffe and Jim Messina, are urging the president to understand that backing benefit cuts could prove disastrous to his 2012 reelection hopes, sources say. ...

White House spokeswoman Amy Brundage said, "The notion that the president’s team is divided on our approach to this issue is flatly untrue. ..."

No Overtime Due To Budget Stalemate

From the Federal Times:

The Social Security Administration has canceled overtime for most employees, effective immediately, according to a message from the agency's top finance official.

The only exception is for overtime "directly related" to life, safety and preservation of property, Deputy Commissioner Michael Gallagher said in a Friday e-mail. The decision was the result of discussions earlier that day between Social Security Commissioner Michael Astrue and the Office of Management and Budget, Gallagher said. ...

Based on the Obama administration's fiscal 2011 budget request, for example, the agency expected about 3,200 work years to come from overtime, versus some 68,800 from full-time equivalents.

Service Slipping

From today's New York Times:

Unsure from week to week how much money Congress will provide them as the two parties battle over the budget for the rest of this year, federal officials say many agencies have been operating in chaos, confusion and uncertainty. ...

Michael J. Astrue, the commissioner of Social Security, said the agency had cut back distribution of annual earnings and benefit statements and had suspended plans to open eight hearing offices that would tackle a huge backlog of appeals by people seeking disability benefits.

Like most of the government, the Social Security Administration has been financed for more than five months with short-term spending bills known as continuing resolutions. Congress is expected to pass another three-week spending bill this week that will continue to pare back financing from last year’s level.

“Because of the uncertainty of our budget,” Mr. Astrue said, “I have had to make choices that will begin to erode service.”

House Appropriations Hearing

The House Appropriations Committee has scheduled a hearing for March 17 on improper payments. Social Security is not the only focus of the hearing but Social Security's Inspector General, Patrick O'Carroll, and Deputy Commissioner, Carolyn Colvin, will be testifying. Note that there has not yet been a hearing on Social Security's appropriation. Of course, O'Carroll and Colvin will undoubtedly use this as an occasion to tell the Committee that additional employees at Social Security would save money.

No Overtime At Payment Center

An e-mail I recently received:

Hello. I work for the Social Security Administration, Payment Center 7, in Baltimore, MD, as a Claims Authorizer (CA).

We handle the SSA disability case workload. One function of my job is to trigger ALJ [Administrative Law Judge] disability awards to payment, providing the non-medical requirements are met. We also do post adjudicative work, such as imposing and removing workers' compensation offset.

CA's have had overtime offered to us for years, both during the week and on the weekend. We need the overtime hours to keep up with our workloads.

Today, Friday the 11th, all the Modules in the Security West Building (PC7) had emergency meetings to announce that all overtime is cancelled indefinitely for all positions. This is apparently related to the budget situation and the continuing resolution.

Hopefully they will find a way to resolve this and restore overtime soon, at least on weekends. I fear that claimants will suffer if this situation is not resolved shortly.

The disability caseload keeps growing, and the cases and disabled claimants are not going to magically disappear, and it seems that some in Congress don't understand this. It is somewhat discouraging to think that someone who has waited for years to have an ALJ hear their case will now have to wait longer to have their award processed, even after the favorable ALJ decision is made.

$200 Million Gone

It appears that Democrats have agreed to rescind $200 million that had previously been appropriated for investment in Social Security's information technology infrastructure. Information Week Government reports on just how urgent this investment is.

It is unclear where this leaves Social Security's appropriations otherwise.

Update: It appears that the $200 million recission is part of a deal for a three week continuing resolution.