Zombie-Nihilists

From the Crooks and Liars blog:

Good grief, this nonsense is just exhausting. Nothing is ever settled with these people, they have been coming after Social Security for 75 years, and they just don't quit, no matter how many times they get chased down with walkers and eaten alive by gray panthers. It's like they are programmed or genetically manipulated, like one of those creepy super-soldiers from science fiction that can't stop fighting after the war is over, even though they recognize the reality. 

Nah, I give them too much credit in that scenario. They are just zombie-nihilists and Social Security is the brain they are driven to eat.

STD And LTD Coverage Plummets

From a press release:

According to new research¹ from The Hartford, 49 percent of U.S. workers have short-term disability insurance [STD] and 44 percent have long-term disability insurance [LTD]. This represents a drop of 6 percent and 3 percent, respectively, over last year’s survey in the number of Americans with the coverage that provides an income if one cannot work due to an illness or non-work related injury.

Does Rehabilitating Disability Benefits Recipients Cost More Money Than It Saves?

Social Security has some very preliminary results from the Benefits Offset Pilot Demonstration (BOPD) (emphasis added):

We designed the four-State BOPD project to provide information about the implementation and the effect of a benefit offset for SSDI beneficiaries.  We used the information collected in BOPD to help design the BOND [Benefits Offset National Demonstration] project....

The pilot includes a targeted group of SSDI [Social Security Disability Insurance] beneficiaries who chose to volunteer for the project.  We gave them the opportunity to receive a $1 reduction in benefits for every $2 earned above the SGA [Substantial Gainful Activity] threshold amount during the extended period of eligibility (EPE), instead of losing their entire benefit, as they would have under our usual rules....

The State [by state] reports show that the benefit offset had a positive effect on the percentage of beneficiaries who have earnings above the SGA amount ($980 per month for the non-blind in 2009).  We conducted our own analysis using Internal Revenue Service earnings data and our benefit payment administrative records.  We found similar effects on earnings.  However, our analysis also showed an increase in benefit payments because we made partial benefit payments under the benefit offset to beneficiaries who would have had their benefits suspended due to SGA under the current program rules....

 No wonder Social Security wants to stretch out BOND over ten years.

Let's Just Abolish FICA And Be Done With It

From Bloomberg News:

President Barack Obama’s advisers have discussed seeking a temporary cut in the payroll taxes businesses pay on wages as they debate ways to spur hiring amid signs that the recovery is slowing, according to people familiar with the matter. 

The idea, which is in preliminary stages of discussion, is among several being talked about at the White House...

A hiring stimulus based on a tax break for employers may appeal to Republican lawmakers, many of whom have called for measures to help businesses....

A temporary break on employer payroll taxes would echo a centerpiece of the deal Obama and congressional Republicans reached in December 2010 to extend tax cuts enacted during the presidency of George W. Bush. That package included a two- percentage-point reduction in employee contributions to the payroll tax during 2011.

Update: Daniel Marans at FDL lays out the case against this sort of "temporary stimulus."

More Fallout In West Virginia

From the Wall Street Journal:

The chief Social Security Administration judge in Huntington, W.Va., has stepped down from his post, an agency official told employees Wednesday, broadening the fallout from a recent page-one Wall Street Journal article about the office.

The decision by Charlie Andrus, who became Huntington's chief judge in 1997, was voluntary, two people familiar with the matter said. Debra Bice, the acting national chief judge, told employees in Huntington he would remain with the agency as a judge, the people said.

"Revisions To Direct Fee Payment Rules"

Below is the notice of a regulatory package that the Social Security Administration has sent over to the Office of Management and Budget (OMB):

AGENCY: SSA	RIN: 0960-AH21
TITLE: Revisions to Direct Fee Payment Rules (3625I)
STAGE: Interim Final Rule	ECONOMICALLY SIGNIFICANT: No
** RECEIVED DATE: 06/06/2011	LEGAL DEADLINE: None

Social Security must have OMB approval before publishing this in the Federal Register. 

No, I don't know what this is. The "interim final" process that Social Security wants to use suggests that  the agency regards this, or at least wants OMB to regard it, as very minor. Could anyone enlighten us?

Update: I found this:

We are revising our rules to include changes made by the Social Security Disability Applicants’ Access to Professional Representation Act of 2010 (PRA). We are revising the requirements that an eligible non-attorney representative must meet to receive direct fee payment under titles II and XVI of the Social Security Act (Act). We are also making permanent the direct fee payment rules for eligible non-attorney representatives under titles II and XVI of the Act and for attorney representatives under title XVI of the Act. 

It's Only Crazy People

From a recent report by Social Security's Office of Inspector General (footnotes omitted):

Our objectives were to determine whether the California Disability Determination Services (CA-DDS) (1) incorrectly denied initial claims based on failure to cooperate (FTC) . ...

RESULTS OF REVIEW
CA-DDS did not always comply with SSA’s policies and procedures for FTC denials. Based on our review of 150 FTC denials, we found that 37 (24.7 percent) did not comply with SSA’s policies and procedures ...

We also found that CA-DDS branch offices’ interpretations of the FTC policies resulted in an inconsistent level of service for disability applicants. ...

A DDS is required to assist claimants who allege a mental impairment.When this occurs, a DDS should consider contacting a third party, SSA field office, treating physician, or the claimant. We found that CA-DDS staff did not request assistance from third parties for 12 claimants, as required. These claimants had alleged mental impairments including depression, anxiety, and schizophrenia. The claimants had listed authorized representatives, family members, or friends who would provide assistance during the application process. However, CA-DDS did not contact these individuals before denying the claimants for FTC.

Congressional Hearing On Overpayments

From a press release:

House Ways and Means Oversight Subcommittee Chairman Charles Boustany, Jr, MD (R-LA) and Social Security Subcommittee Chairman Sam Johnson (R-TX) today announced that the Subcommittees on Oversight and Social Security will hold a hearing on the accuracy of payments made by the Social Security Administration (SSA).  The hearing will take place on Tuesday, June 14, 2010, in 1100 Longworth House Office Building, beginning at 2:00 P.M. ...

According to the President’s fiscal year 2012 Budget request, next year the SSA is expected to distribute nearly $820 billion in benefits to over 60 million people. ...

[D]istribution of such significant sums of taxpayer dollars means that even a very low overpayment rate can result in a substantial loss to the taxpayer and the Social Security program.  According to the latest available data, in FY 2009 overpayments included $841 million in the OASI program, $1.7 billion in the DI program, and $4.0 billion in the means-tested SSI program. ...

For the five-year period ending fiscal year 2009, errors involving the determination of “substantial gainful activity,” essentially whether earnings are high enough to end eligibility for DI  benefits, account for the majority of overpayment errors, nearly $1 billion annually, or 36 percent of total retirement, survivors, and disability program error dollars.  Of these error dollars, 64 percent resulted from beneficiaries’ failure to report their work activity.  The other 36 percent were associated with the SSA’s failure to schedule a work continuing disability review (CDR) after the beneficiary notified the SSA that they returned to work.  Once a beneficiary notifies the SSA of their earnings, it may be months or years before the SSA sends an overpayment notice to the beneficiary, demanding repayment of sometimes tens of thousands of dollars of accrued overpayments. ...

Medical CDRs are periodic reviews conducted to ensure recipients are still disabled according to Agency rules.  In FY 2009, these reviews have generated $12.50 in savings for every dollar invested. Despite their substantial savings, the frequency of these reviews is declining.  The number of completed medical CDRs fell 65% between FY 2004 and FY 2008, with a backlog of more than 1.5 million medical CDRs at the end of FY 2010.  The SSA Office of Inspector General (OIG) estimates that this backlog may lead to as much as $1.1 billion in overpayments in 2011 alone.

SSI program integrity work has followed a similar pattern, with funding levels and redeterminations peaking in 2003, falling through 2007, and then beginning to rise again in 2008. ...

In announcing the hearing, Chairman Boustany said, “Whether through error or outright fraud, overpayments across the government are a substantial problem costing taxpayers tens of billions of dollars each year.  The Oversight Subcommittee is reviewing these overpayments in a series of hearings, taking a closer look to identify how overpayments occur and funding solutions to better protect taxpayer dollars and program beneficiaries.” 

In announcing the hearing, Chairman Johnson said, “We are facing a debt crisis because Washington spends too much and wastes too much.  Payments that are wrong due to fraud or poor management at Social Security are unacceptable. Americans whose hard earned wages support these programs want, need and deserve better.”

It is hard to follow the numbers being given in this press release but the overpayment rate in Title II appears to be about 0.4% in Title II and 8% in Title XVI, Supplemental Security Income. This is real money but this is not going to get better without more operating funds for the Social Security Administration but the Republicans in control of the House of Representatives are determined to give Social Security far lower operating funds. In general, the attitude of Republicans to programs they dislike but cannot completely eliminate -- with Social Security being the prime example -- is to decry their mistakes and inefficiencies which gives justification in their minds for decreasing funding for those agencies which leads to more mistakes and inefficiencies which justify even lower funding, etc. They cannot make the Social Security Administration disappear but they can hobble it and hold it up to ridicule in the forlorn hope that this will help the American people see Social Security they way they see it, as the original sin that has led to what they regard as a welfare state that sucks away the country's hard earned wealth and gives it to a bunch of free loaders, albeit it freeloaders who mostly worked hard all their lives and paid the taxes based upon the promise that they would be taken care of in their old age.