Social Security Subcommittee Chairman Wants Work Incentives Planning Programs Back

     Sam Johnson, Chairman of the House Social Security Subcommittee, sent Commissioner Michael Astrue a letter complaining about Astrue's decision to end two programs that assist disability benefits recipients in planning return to work. Apparently, Johnson and Astrue are trading legalistic arguments over the subject. The underlying problem is that Social Security's budget is ridiculously tight and neither program ever demonstrated much than one could reasonably call success. 

     We needs to understand a couple of things:

• Everything anyone can imagine to encourage disability benefits recipients to return to work has been tried, including tossing many people off disability benefits. None of it has succeeded in returning more than a tiny percentage of people to work.
• The only thing anyone can reasonably do to make even a marginal difference in the rate of return to work is to simplify Social Security's return to work incentives. Over the decades, there has been constant Congressional interest in painlessly cutting the numbers of people drawing disability benefits by enticing disability benefits recipients back to work. Again and again, Congress has passed some new incentive program to go on top of the incentive programs already in place.This has left us with a ridiculous crazy quilt of work incentives that almost no one understands. You don't solve the problem by diverting scarce resources to hiring work incentive specialists. Their existence was a symptom of the problem. You solve the problem by simplifying. If the work incentives can't be explained in two simple sentences, they're too complicated.

Another Think Tank Report On Social Security Disability

     The think tanks are really churning out reports on the Social Security disability programs. The latest comes from  Kathy Ruffing of the Center on Budget and Policy Priorities. Her report includes this interesting chart:

     Claims filed are highly sensitive to business cycle? Note that applications for disability benefits began soaring not in 2008 when unemployment soared but in 1998, ten years earlier, at a time of relatively low unemployment. Note also the inverse relationship between unemployment and the disability claim rate in the early 1980s. How do you explain these facts if claims filed are so sensitive to business cycles?

Social Security Starting To Come Up In Presidential Campaign

     To no one's surprise, Democrats are starting to attack the Romney-Ryan ticket over Social Security. Plans for partial privatization of Social Security play well with Republican voters but not with the electorate as a whole.

Get Rich Quick!

     From a website:

This is Brian Mittman and I want to ask you few questions…Is your practice feeling the effects of “TORT” REFORM, ATTORNEY BASHING, the Stalled Economy, HIGH UNEMPLOYMENT, FISCAL UNCERTAINTY? Is your practice SUFFERING a DROP in Client Flow? Are your Revenues FLAT or worse…declining? ...

Good news is: Nancy Cavey and I are hosting a NEW 2-DAY workshop experience called “7 Figure SSD Practice Blueprint” intended ONLY for lawyers who SERIOUSLY desire to take advantage of (and profit from) an aging workforce and the current downturn in the economy by adding (or improving) their social security disability profit center. ...

And it’s NOT about how much you know about substantive SSD law or how long you’ve been practicing. Once you hear the STRATEGIES Nancy and I reveal during this seminar, your practice and your financial future will SOAR as you’ve always dreamed. ...

Here are just some of the powerful strategies you’ll discover at this “one-time-only” event this September:

• Why almost everything you’ve been told about SSD is DEAD WRONG
• CAUTIONARY RED FLAGS you MUST correct BEFORE EVER considering a SSD Practice
• How to double your profits with the same amount of time, money and energy you’re putting into your practice now
• Marketing secrets to attract quality SSD clients without breaking the bank on advertising
• A simple (Yet Powerful) strategy which Positions you as the SSD expert in your area
• How to positively influence the minds of your clients, and instantly increase client engagement rates
• The exact clients to target (and which to avoid!) which will help you sustain a lucrative SSD practice
• The basics of SSD law and how to manage claims in a way that is cost-effective and less time consuming for you and your staff.
• Easy ways to automate and systematize your firm to enjoy a steady income stream which feels virtually effortless and runs on autopilot
• Effective marketing strategies designed to attract a consistent flow of new prospects each and every month
• How to obtain the income levels you desire without sacrificing your personal and family life. ...

      Why would I post this? Because it's so absurd! If these folks have the secret to easy riches why would they share them with others? Why wouldn't they just keep expanding? Why would they need such a ridiculously lurid come-on to get people to cough up $1,000 to listen to them?
     The reality is that there are enormous barriers to entry into Social Security practice and serious risks once you get there. The money isn't that wonderful and it's unstable in the best of times and these are not the best of times. Unless you really want to help people, you're likely to find Social Security practice unfulfilling.
     As I've said before, if you think representing Social Security claimants is the fast track to wealth, consider the fact that it's rare for a Social Security employee to leave employment with the agency to begin a Social Security practice. If it were easy, wouldn't Social Security employees be leaving en masse? If you still think it's easy, come join us and see if she still feel the same way in a couple of years.

Dayton Backlogs Draw Senator's Attention

     From the Dayton Daily News:

U.S. Sen. Sherrod Brown’s state director met in Columbus on Wednesday with regional officials from the Social Security Administration to discuss how to reduce the local backlog of appeals for disability benefits, following a Dayton Daily News story on processing delays.

In a July 30 article, the Daily News reported that the Social Security Administration’s Dayton hearing office in the last two fiscal years was the second slowest in the nation for processing appeals for benefits. Even though the office has improved wait times — this year it has not ranked among the 20 slowest in the country — Brown said more must be done to reduce the delays further.

Ammunition Purchases Attract Attention

     I have posted in the past about Social Security's large scale purchases of ammunition -- yes, ammunition. These ammunition purchases are now attracting attention from Business Insider: Military and Defense but, really it's all over the blogosphere. Just do a search on Google Blog Search for "Social Security ammunition." I received e-mails from five different people yesterday giving me a link to stories about this. This is spreading fast.
     Why would Social Security buy 174,000 rounds of .357 magnum hollow point ammunition?  That's vicious stuff. What's next, rocket propelled grenades? Armored personnel carriers? Black helicopters?
     This is nothing to get paranoid about. It's for target practice for Social Security's Office of Inspector General (OIG). Years ago OIG had a website that proudly featured a photo of their huge cache of firearms. They really wanted to play up the G-man aspect of their work even though crime isn't that big a part of what they do and the crime they deal with is almost never violent. It's more like dealing with some pathetic soul who stuffed his deceased mother into a freezer so that he could continue to collect her Social Security benefits. Arrest them. Convict them. Send them away to prison. But don't pretend you're dealing with a Mexican drug cartel. OIG can easily call upon other law enforcement agencies to help when they are required to deal with people who might be armed. That ridiculous photo of OIG's arms cache is long gone from the OIG website but the attitude seems to remain. Should taxpayers be subsidizing this sort of fantasy? How many OIG employees really need to make regular visits to the firing range? I'm guessing it's not nearly enough to justify purchasing 174,000 rounds of high powered ammunition. Waste can happen even at OIG but who do you ask to investigate when it's OIG that's wasting money and inciting paranoia?

     Update: OIG has responded. 

     Further update: Fox News is jumping to OIG's defense.

A Nudge?

     Social Security's Administrative Law Judges (ALJs) are denying a higher percentage of the disability claims they hear. Earlier this week I posted this excerpt from a Pittsburgh Tribune-Review article:

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.” ...

      That seemed to me to be something of a boast that Social Security had found a way to influence at least some ALJs to deny more claims. How would the agency accomplish this? One commenter, probably an ALJ posted this response:

I believe what you say here is true insofar as the training part. For decades, the files were assembled, i. e., organized and exhibited, and then given to the judge to review before it was scheduled. During this review, the judge would determine whether any additional medical exams should be ordered and whether the evidence was sufficient for an award on the record. 

Beginning two to three years ago, the new judges were "trained" to NOT conduct a pre-scheduling review, but rather to review the cases just shortly before the hearing.  

The general effect of this is to deprive some claimants of more thorough development of the medical record and in my opinion likely reduces the award rate.  

In addition, the most sinister program in place is called "How Am I Doing." This is a desktop program that opens to display graphs which show the case production rate of the judge in comparison to his peers. The really bad part is a graph that displays the judge's grants versus denials. 

There is no purpose for the grant/denial graph other than to herd judges to the mean. Not based on the facts of the case. I question the impartiality of judges with the introduction of this behavior modification tool. It can have no other purpose except to influence the outcome of cases based on something other than the facts of the case.

     For those of you on the inside, is this an accurate statement of what is going on? Are these good things or bad things? If there is such a thing as "How Am I Doing", would it have the effect of reducing the percentage of claims approved? Would it affect ALJs who allow a high percentage of claims more than it affects those deny a high percentage of claims?

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.