What Is This?

     While a Social Security employee, Andrew Biggs campaigned with then President George W. Bush for partial Social Security privatization. In case you don't know, that's definitely not the done thing, even for Social Security Commissioners. In fact, especially for Social Security Commissioner and other high ranking officials as Biggs was at the time.The Social Security Administration tries hard to stay out of any long term financing issues apart from having the agency's Office of Chief Actuary provide technical support to everyone involved in the debate. Bush later nominated Biggs to become Deputy Commissioner of Social Security. He could not get confirmation so Bush gave Biggs a recess appointment to the position. After Bush left office and Biggs' term as Deputy Commissioner ended, Biggs went to work for the American Enterprise Institute, a right wing think tank.
     Biggs has now authored a piece for Our Generation on Social Security disability insurance. Our Generation describes itself as "membership-based nonprofit, nonpartisan advocacy organization founded in 2009 to research, educate and promote long-term free market solutions to today’s public policy concerns." The piece that Biggs wrote is only nine pages and was certainly nothing researched in depth or, at least, any research is not reflected in the piece. Our Generation makes a point of noting that the piece was edited by its executive director. In the piece Biggs recommends:

• Tightening eligibility requirements, although he does not say how;
• Doing continuing disability reviews. These are already being done but at a low level due to lack of administrative funding. Biggs doesn't explain how he would want these done differently or how he would pay for anything more than what is being done now.
• Include incentives for employers to keep individuals on the job such as "experience rating" for the disability portion of the F.I.C.A. tax or requiring employers to carry short term disability benefits to help workers deal with the waiting period for Social Security disability benefits. How the latter would help escapes me. Neither would be a bit acceptable to the people paying Biggs' salary.

Institutional Rep Payee Shut Down In Oregon

     From KVAL in Oregon:

David Finch said his company has done no wrong.  

"Oh, I'm very angry at this thing," said the director of Emmanuel Credit Management. 

The company got word last Friday from the Social Security Administration that it had lost legal standing to make rent, utility and other payments for 102 senior and disabled clients who receive Social Security payments. 

"They've already suspended all the payments to the clients," Finch said. 

Social Security claims Emmanuel Credit has made mistakes in handling funds and keeping records. 

Among the allegations: records not kept to track individual funds, lack of overall receipts, and receipts not kept on expenses paid for clients.

      I don't know what's going on here but there have been far more problems with Social Security not acting soon enough on problems with institutional representative payees than with the agency being overly hasty. Shutting down a major institutional payee like this is a major headache for Social Security and for local social service agencies, not to mention the individual claimants involved.

OIG Report On Households With Multiple Members Receiving SSI

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

Based on address matches that appeared on SSA [Social Security Administration] payment records, we estimate that 647,922 households had 2 or more SSI [Supplemental Security Income] recipients receiving payments in July 2011. Because SSA payment records indicated that, in general, annual SSI payments to two-and three-recipient households were at or below the Federal poverty guideline (see Table 1), we performed no further analysis of these payments.

However, SSA payment records indicated that annual SSI payments to about 11,481 households with 4 or more recipients were above the established Federal poverty guideline for comparable household sizes. SSA payment records indicated that individuals in these 11,481 households received approximately $63 million in annual SSI payments above established Federal poverty guidelines.

      I have some concern that OIG may have misidentified some group homes or other institutional settings as "households" since their own numbers show that many of the SSI recipients involved suffer from mental retardation. A footnote in the report says that these cases were excluded but I have trouble believing that Social Security's databases are accurate enough to completely exclude these cases.
     Any change in program rules for households with four or more SSI recipients would add administrative complexity. The additional costs of administration would partially offset any savings which could be achieved.

Interpreters

     Social Security's Chief Administrative Law Judge has issued a Bulletin on hiring interpreters for Administrative Law Judge hearings. It seems to indicate that the norm is to use an interpreter who participates only by telephone and that a claimant must make a special request for an in-person interpreter. 

     This does not seem adequate or fair to me.

What Is Going On In Pittsburgh?

    Just a few days ago, the Pittsburgh Post-Gazette ran a bizarre op ed piece that baldly stated that all one had to do to get on Social Security disability benefits was to go to one psychiatric exam and feign mental illness, which is simply untrue. Now the Pittsburgh Tribune-Review is running this article:

Few of the petitioners who appear before Administrative Law Judge Manny Smith hear the word “no.”

Smith grants benefits in close to 80 percent of the Social Security disability claims he hears, nearly twice as often as other administrative judges in Western Pennsylvania and much higher than the national average of 58 percent, federal data show. ...

“If we don’t do something, in four years it won’t be able to pay full benefits,” said Sarah Swinehart, a spokeswoman for the House Ways and Means Committee. Its Social Security Subcommittee has held five hearings on disability insurance over the past year. ...

“The whole procedure may have made sense 20 years ago, when most people were honest and didn’t know about” the disability program, said James Bukes of Mt. Lebanon, who retired in January after two decades as an administrative law judge. “But now it’s become such a big business.” ...

Legislation to change the system might emerge this fall. Lawmakers want to ensure Social Security keeps paying those who need help while safeguarding taxpayer dollars, Swinehart said. ...

The rise in disability applications to 2.88 million in 2011 stems from a half-dozen sources, including the economic downturn and a surge in legal representation for applicants, Pierce said. He said lawyers earn about $1.4 billion a year by representing disability appellants, about 85 percent of whom have private counsel. ...

The Social Security Administration has moved toward more standardized decision-making, said Assistant Deputy Commissioner Jim Borland. He said the number of judges who allow nearly all claims has fallen by more than half since 2007.

“We have created new tools to focus on quality,” Borland said. “Each quarter, we train our adjudicators on the most complex, error-prone provisions of law and regulation.” ...

[Richard J.] Pierce [a George Washington University law professor who has been harshly critical of ALJs] has suggested the government drop law judges from the process. He estimates their salaries and benefits cost more than $2 billion a year.

      A few points:

• The article does not once mention the aging of the baby boomer generation as a reason for the problems of the disability trust fund even though no one with any knowledge of the situation would deny that this is far and away the most important reason.
• The House Social Security Subcommittee may report out legislation in the next month to do something about Social Security ALJs.
• A Social Security Assistant Deputy Commissioner is bragging that the agency has found a way to "train" ALJs so that they allow fewer disability claims.
• Professor Richard Pierce thinks that Social Security's ALJs cost $2 billion a year. Since there are about 1,500 ALJs at Social Security, Pierce must think that pay and benefits for each ALJ are over $1.3 million a year. The real figure is less than one-tenth of that.
• The Pittsburgh Tribune-Review is owned by Richard Mellon Scaife. Scaife is best known for promoting bizarre ring wing conspiracy theories about President Bill Clinton, including accusing Clinton of murder and drug smuggling. In a bizarre twist, Scaife later endorsed Hillary Clinton when she was running for President. The Tribune-Review and Post-Gazette newspapers are bitter rivals.

Password Delays

     I and others have been experiencing significant and annoying delays in the transmission of the passwords necessary to obtain access to our clients' files through Social Security's Electronic Records Express system. Does anyone know what's going on?

     By the way, the whole second password as a text message process seems pointless to me. You don't need the second password to change the cellphone to which the text message is sent. If I were up to no good and had the user name and first password, I would just change the cellphone number, which defeats the point of the second password. How does the second password via text message add anything other than delay and annoyance to the system?

Gloom And Doom From The Associated Press

      From the Associated Press:

As millions of baby boomers flood Social Security with applications for benefits, the program's $2.7 trillion surplus is starting to look small. ...

Since 2010, Social Security has been paying out more in benefits than it collects in taxes, adding to the urgency for Congress to address the program's long-term finances.

"To me, urgent doesn't begin to describe it," said Chuck Blahous, one of the public trustees who oversee Social Security. "I would say we're somewhere between critical and too late to deal with it." ...

Social Security Commissioner Michael J. Astrue said he is frustrated that little has been done to solve a problem that is only going to get harder to fix as 2033 approaches. If changes are done soon, they can be spread out over time, perhaps sparing current retirees while giving workers time to increase their savings.

"It won't be easy but it's just going to get harder the longer they wait," Astrue said.  ...

     The article does not mention the fact that lifting the cap on earnings subject to the F.I.C.A. tax would solve the problem. It sounds as if Charles Blahous regards that idea as being unworthy of any consideration.

We're Frugal

     From the Associated Press:

Compared with most public pension systems in Europe, Social Security is downright frugal.

On average, European pensions are more much generous than Social Security, providing retirees with benefits that come closer to matching the wages they earned when they were working. Americans are expected to rely more heavily on private pensions and savings when they retire.

European workers also have been able to retire earlier than American workers, though many European countries are retreating from those policies, a subject that has caused more than a little unrest.

Taxes also are higher in most European countries and some of their retirement systems are facing worse financial problems than Social Security.