August 3 Social Security And SSI Checks At Risk

The current status of raising the debt ceiling is that even if Republicans and Democrats could immediately agree on a plan, there is hardly enough time to pass a bill if recalcitrant Senators such as Jim DeMint (R-SC) and Rand Paul (R-KY) filibuster and they probably will. There is no agreement among the leaders and it is unclear whether Republicans in the House of Representatives will be willing to agree to anything. Many of them believe that failing to raise the debt ceiling would have only minor consequences and would be desirable. Financial markets will put pressure on everyone as the week goes along. 

There is a very real chance that the Social Security and Supplemental Security Income (SSI) checks due to go out on August 3 will be delayed. That would be terrible in and of itself but there is an enormous threat to the U.S. economy.

This Could Happen At A Social Security Office

From TPM Media:

Stop me if you've heard this one. A man goes into a public assistance office in Charleston, South Carolina in a kilt, tells them he's a member of the Irish Republican Army and asks for help for 25 fellow Irishmen in a hospital who need Medicaid.

A government employee follows the rules and explains the process for filling out a Medicaid paperwork and the qualifications they'd need to meet. She informs them that a federal law intended to protect patient privacy requires her not to divulge any information he's told her.

So what happens next? James O'Keefe's Project Veritas releases a deceptively edited video that makes the woman look like a terrorist sympathizer, though it isn't even clear if she knows the background of the IRA. ...

[And more on what happened at that public assistance office] The South Carolina Heath & Human Services employee explains that only U.S. citizens are eligible for Medicaid and says she's not making any promises that the 25 purported IRA members would qualify. 

Will The August Social Security Checks Come Out On Time?

Read this detailed report from the Los Angeles Times on how the debt ceiling talks broke down and tell me that you're still optimistic that the debt ceiling will be raised in time to prevent delays in issuing Social Social checks. I will grant that I have said in the past that we should watch the stock market to see how serious the threat is and the stock market may have been a bit nervous but there has been no sign of collapse.  It's hard for me to believe that anything other than the rapid collapse of financial markets will bring about a resolution of this problem.

By the way, notice that Republicans wanted to delay the announcement that they were withdrawing from talks with the White House until after the stock market had closed for the week. We'll have to watch to see what happens on Monday.

No Security Guard Involved In Feig Firing

When Commissioner Astrue fired Martin Gerry from his high level position at Social Security, Gerry was escorted from the building by a security guard. Also, his computer was seized and his office lock changed. I don't know what happened to Ephraim Feig's computer or office lock but he tells me that there was no security guard involved in his departure. The firing came while he was out of the office. When he returned days later he was allowed back into the building and spent about an hour talking with human resources before leaving.

Commissioner's Message: Field Office Hours To Be Reduced -- Policy Changes Coming

A Message To All SSA and DDS Employees

Subject:  New Social Security Field Office Hours

Given the tight budget situation, we must continue to make tough choices.  The latest decision is that, beginning August 15, 2011, we will close Social Security field offices to the public 30 minutes early each day.  For example, a field office that is usually open to the public Monday through Friday from 9am to 4pm will now close daily at 3:30 pm.

Reducing hours will allow field office employees, who will continue to work their regular hours, to complete interviews without using overtime.  That's essential because Congress provided us with nearly $1 billion less than the President requested for our budget this fiscal year, which makes it very hard to provide the amount of overtime that our usual business process requires.  

Field offices have lost nearly 1,600 workers over the past nine months, and we cannot afford to replace that staff. As a small measure to help deal with those losses, we will close field offices to the public on Friday, November 25, 2011.  Field office employees who work on that day will use the day for backlog reduction.  As we try to adapt to these difficult fiscal times, we need to remind the public that they can find many services and get up-to-date information online or via our 800 number.

Soon I will be announcing policy changes that will allow us to work more efficiently.  Please know that we are doing what we can to help you during these difficult times. 

Michael J. Astrue
Commissioner

Update: And Social Security has issued a press release saying the same thing.

As Bad As Delayed Social Security Checks Would Be, There Are Even Worse Things Threatened

I have no idea where we are going to end up with the debt ceiling negotiations. I doubt that anyone feels confident about what will happen. You can read about the current confusing state of negotiations. 

I have a bad feeling that this is all going to on Monday August 2 amid bitter recriminations and that the country will be plunged into a crisis with delays in Social Security checks, and that would be terrible, being not even the most urgent aspect. We would be looking at an incredibly fast moving economic crisis with a government paralyzed by Republicans in the House of Representatives whose deeply held philosophical beliefs would prevent any effective action to deal with the crisis.

A Little Light On LTD Carriers And The Companies They Hire To Represent Social Security Claimants

See the decision in Kisor v. Advantage 2000 Consultants, No. 10-1045-WEB (D. Kan. June 30, 2011), concerning a non-attorney group (Advantage 2000) hired by an administrator of a long term disability insurance (LTD) carrier (CIGNA) to represent a disabled person before Social Security and also to collect money from that disabled person if he was approved for disability benefits by Social Security. The Plaintiff's case was based upon provisions of the Kansas Consumer Protection Act. The Court held that the lawsuit was barred by federal pre-emption but that the Plaintiff could amend his complaint.  It is unclear what the effect of that amendment would be.

There is some interesting information in the order about the relationship between the insurer, CIGNA and Advantage 2000:

CIGNA pays A2K a flat fee for its social security representation services, and a contingency fee equal to an undisclosed percentage of the actual dollar amount repaid by A2K’s Social Security clients to CIGNA as a result of A2K’s COR services. A2K and CIGNA agreed that A2K would not disclose to its Social Security clients any information about how A2K is paid. ...

A2K’s Benefit Coordinator bonus program (“Bonus Program”) pays commissions to A2 Benefit Coordinators based upon the recovery of money from A2K’s Social Security clients for A2K’s LTD clients.

You Have To Watch The Stock Market To See If Your Social Security Check Will Keep Coming

Ezra Klein writing in his blog at the Washington Post about the efforts to extend the debt ceiling -- and keep the Social Security checks coming out on a regular basis:

It's pretty clear that if it was just John Boehner and Barack Obama in a room, they could come to a deal. If it was just the Senate that had to approve a bill, they could come to a deal -- perhaps even a big one. It's the House that's the problem. They rejected the $4 trillion deal the White House offered, suggesting they can't go big, and the Tea Party is whipping against the McConnell deal, which implies they can't go small. A lot of the dealmakers are, at this point, stymied. “We want to accommodate their needs,” Sen. Benjamin L. Cardin said of the House leaders. “We just don’t understand what their needs are.”

It's not clear they do, either. One common explanation for where we are in the talks is that we're waiting for the last minute. No deal struck before the last minute will be credible as the best deal Republicans could possibly get, because in this negotiation, time is leverage, and if the clock isn't one minute from midnight, that means there's leverage Republicans chose not to use. Until we hit that point, there's just not enough incentive for the House GOP to say "yes" to anything, not enough pressure to force them to say "yes" to anything, and there's an argument, popular among some conservatives, that it would in fact be a mistake to say "yes" to anything.

But what no one quite knows is what the House GOP will accept when the clock is one minute from midnight, or, in more pessimistic tellings, the Dow is 1,000 points below whatever it was at the day before. We're hearing talk that the "Big Deal" is being revived, but the bigger the deal, the tougher it is to pass quickly. And so if it is the case that we can't strike a deal until the markets are beginning to bottom out or the debt ceiling is about to cave in, it's a pretty good bet that we're not going to strike a big deal, and it's very hard to predict what sort of small deal the politics will permit at that point. Which is worrying. The political dynamics here imply a lot of uncertainty all the way to the end, but excess uncertainty is the one thing that could lead the market dynamics to turn sharply against us.

Got that? Worried that you won't get your Social Security check on August 3? Watch the stock market. Nothing will happen until the stock market plummets and maybe even that won't be enough to get House of Representatives Republicans to vote for a debt ceiling hike.