Bad News On Appropriations

     Reportedly, Congressional leaders are close to agreement on an appropriations bill that will cover most federal agencies, including Social Security. The House Appropriations Committee has released a summary of the bill which says that "The bill funds SSA at $10.6 billion to administer SSA [Social Security Administration] activities, which is $74 million above FY [Fiscal Year] 2011 and $865 million below the President’s request." This is less than what had been in prior versions of the bill. The summary does not address the question of how much money will be earmarked to program integrity activities.

Update: I have now found a copy of the bill (the information important to Social Security begins at page 146 of the PDF).The actual base amount for Social Security is $10,555,494,000. On top of this, the agency gets $274 million for continuing disability reviews, which is down from $756 million as originally planned. The bill includes this larguage, which I do not understand:

That reimbursement to the trust funds under this heading for expenditures for official time for employees of the Social Security Administration pursuant to 5 U.S.C. 7131, and for facilities or support services for labor organizations pursuant to policies, regulations, or procedures referred to in section 7135(b) of such title shall be made by the Secretary of the Treasury, with interest, from amounts in the general fund not otherwise appropriated, as soon as possible after such expenditures are made.

Wall Street Journal Article

     Damian Paletta has an article in the "Politics" section of the Wall Street Journal today. The article deals with two issues that have been discussed in this blog in the past:

• The Administrative Conference of the United States (ACUS) will do a study of Social Security's disability programs. This study will "focus" on Administrative Law Judges (ALJs). Harold Krent, dean of Chicago-Kent College of Law is to be the lead researcher. According to the article "A top Social Security Administration official had a conference call with roughly 300 managers Wednesday to express concern about the issue of outlier judges [mostly those who approve too many claims] and said he was hopeful the new study could provide ways to address the problem, a person familiar with the call said."
• Social Security will stop notifying claimants and their attorneys of the identity of the ALJ to hear a case. This is to be a secret until the day of the hearing.

Commissioner On Shutdown Threat

Message:
From: ^Commissioner Broadcast
Sent: Wednesday, December 14, 2011 05:32 PM
Subject: COMMISSIONER'S BROADCAST--12/14/11

A Message To All SSA Employees

Subject: Important Message

While Congress continues to consider an omnibus appropriations bill along with extensions to the payroll tax cut and Unemployment Insurance benefits, there is no guarantee that it will finish its work before our current appropriation expires on Friday at midnight.  The President has urged all Members of Congress to complete the work they were elected to do and has made clear that there is no excuse for Congress to leave on vacation before its work is complete.  The President has also made clear that he does not want a government shutdown.   Given the realities of the calendar, however, prudent management requires that we plan for an orderly shutdown should Congress fail to complete its work or fail to pass another short-term continuing resolution that would give it more time to take up these important matters.

Both the President and I know that the uncertainty of the current situation puts federal employees in a difficult position, and we are very much aware that a shutdown would impose hardships on many employees as well as the groups and individuals our agency serves.  As we approach the expiration of the current appropriation, we will provide you with updated information as soon as it becomes available.  For now, I want to provide you with information on how the potential funding lapse–should it occur–would affect our employees.

If funding lapses, we would not be permitted to incur further financial obligations for activities funded by annual appropriations, except those related to the orderly suspension of operations or performance of excepted activities.  Such a funding lapse would mean that some employees would be furloughed and prohibited from working.  Our contingency planning for the potential funding lapse includes determining which agency functions and employees are excepted from a furlough.  Should it become necessary to implement our contingency plans, you will receive informal notice from your manager no later than Friday, December 16 and formal notice no later than Monday, December 19 regarding the designation of your position and furlough status.

The Office of Personnel Management (OPM) website, www.opm.gov/furlough2011, addresses some of the questions that I know must be on your mind.  As needed, OPM will provide additional pertinent information for federal employees as the week progresses.  We will also do our very best to provide clear information about the status of events as the week progresses.

Thanks to your hard work and dedication, we provide critical services to the American public.  Your contributions touch lives in so many significant ways, and I want you to know how deeply I appreciate your dedication and your expertise.

We will be in touch again soon.

    Michael J. Astrue
    Commissioner

I've Got A Secret

     I am hearing that beginning next Monday, Social Security will no longer notify a claimant or their attorney of the identity of the Administrative Law Judge who will hear the case until the day of the hearing.

What Is Going On At The Payment Centers?

     Social Security has released numbers indicating that payments of fees to attorneys and others for representing Social Security claimants are down about 15% since the beginning of the fiscal year, October 1, 2011. This indicates about a 15% drop in payments of back benefits to claimants as well. From what I am seeing, this payment slowdown is not getting better. It may be getting worse. The loss of overtime because of lack of operating funds accounts for some of this but I have a hard time blaming lack of overtime for the whole problem. I have heard reports that the settlement of a class action lawsuit concerning notices to blind claimants is part of the problem, as payment center personnel are now required to spend time calling blind recipients and reading notices to them. I have also heard that payment center personnel may now be involved in some way in identifying claimants to be targeted for continuing disability reviews. I do not know if the reports I have heard are accurate or whether they are anything like the whole story. Can anyone tell me what is going on? What is planned to deal with the usual problem of employees taking time off around Christmas because of "use it or lose it" with their annual leave? What is planned to deal with all the telephone calls that typically cause problems for the payment centers in January? If the current problems were to persist for an entire year, we would be in what I would consider an unimaginable situation where it is taking more than three months to get a claimant on benefits after they are approved. That isn't going to happen, is it?

Quiz Answer

Question: By how much are SSI benefits reduced if a recipient is living in the household of another and receiving free room and board throughout a month?

Possible Answers:

• One-Third
• One-Half
• $250
• The actual value of the room and board

Correct Answer: One-Third

Quiz

Free Web poll for your Web site - freepolls.com

What Happens If The Disability Trust Fund Runs Out Of Money?

     Most people think there is only one Social Security trust fund but there are two. The one most people don't know about is the Disability Insurance Trust Fund. It has much more immediate problems than the Retirement and Survivor's Insurance Trust Fund. The Disability Insurance Trust Fund is predicted to run out of money in 2018. Restoring the Disability Trust Fund to health isn't that big a deal.A small reallocation of the FICA tax would do it with little effect upon the Retirement and Survivor's Insurance Trust Fund. You may have noticed, however, that Republicans have been taking hostages lately, refusing to agree to routine measures that prevent catastrophes, in order to achieve leverage. This tactic may have run its course as the public is tiring of crises and Democrats seem willing to practice brinksmanship themselves. Still, there is a very real threat that Republicans will attempt to use the problems of the Disability Insurance Trust Fund to force dramatic changes in Social Security's disability programs.
     It's impossible now to predict whether there will be a crisis in a few years or what the Republican demands or Democratic response might be. It may be worth looking though at the question of exactly what looms if there is no agreement. My first thought was that there won't be a crisis because there is already authority for borrowing between the Trust Funds. Unfortunately, my memory failed me. There was such authority at one time but it expired in 1987. Let's hope this authority can be quietly renewed before 2018. My second thought is to wonder just how benefits might be paid if the Disability Insurance Trust Fund runs out of money because the exhaustion of the Disability Trust Fund does not mean that there will be no money to pay benefits. Actually, there will be enough money to pay about 84% of the benefits since there will still be revenue coming into the Disability Insurance Trust Fund, allowing some benefits to be paid out of the revenue stream. Would Social Security just reduce each month's check by 16%? Probably, but a Congressional Research Service study on the subject tells us that the Disability Trust Fund running out of money would be terra incognita. There is no clear statutory answer. Perhaps, the answer would be to delay each month's checks until sufficient funds are available to cover them, making each check later and later.