How Many Fees Does Social Security Expect To Collect?

     From a solicitation posted by Social Security:

The Social Security Administration (SSA) plans to issue a solicitation for a streamlined remittance process and an automated system solution to collect fees from SSA's field offices for non-programmatic services.   The total system solution, Social Security Remittance System, (SERS) will provide 1300 field offices with an automated solution to collect, track, record, and report on fees collected for providing various non-programmatic services to individuals and third parties.

Some Ideas For "Reforming" Social Security Disability

     This is what I love about the "experts" who want to "reform" Social Security disability. They keep promoting ideas that are politically hopeless or obviously doomed to failure. From Dylan Matthews writing in the Wonkblog at the Washington Post, with my comments in brackets:

Chana Jaffe-Walt’s NPR article/segment on disability insurance has provoked considerable debate as to the program’s health and how, if at all, it needs to be changed. So what reform proposals are on the table? ...

1) ...Under [one] plan, employers would be required to pay premiums for disability insurance for their workers. Up to half the cost of those premiums could be deducted from earnings. Employees become eligible after 90 days of employment, and the earliest they can get their first check is after 180 days of employment. [Increasing taxes on employers in order to provide more disability benefits -- that's certainly going to be a hit with Republicans.] ...

2) Higher taxes for employers who produce disabled workers [That's a great way to encourage manufacturing! Maybe I should explain since the people promoting this idea know no one who works in manufacturing and have never visited a manufacturing plant. Manufacturing jobs are more physically demanding than working in an office. They're much more likely to cause injury or repetitive motion disease. For good reason, workers compensation insurance rates are much, much higher for manufacturing plants than for offices. This plan would dramatically add to that burden on manufacturers. Also, people who hold manufacturing jobs tend to be people who either dropped out of high school or barely got a high school diploma. In large part these are people who have cognitive abilities in the borderline to low average range, meaning they have little to fall back on if illness or injury strikes, making them more disability prone. If you don't fully understand the phrase "cognitive abilities in the borderline to low average range" and the connection I'm drawing here is hard for you to understand, you really ought to put in more time studying these issues before putting forward your plans to "reform" Social Security disability.]

3) Try a few approaches, expand what works: The Kennedy School’s Jeffrey Liebman and the OMB’s Jack Smalligan have proposed the creation of three demonstration projects to test possible reforms to the program. One would mimic either the [idea one or two]. Another would attempt to prevent applications for insurance through the provision of wage subsidies and vocational aid to disabled workers tempted to leave the workforce [You've got someone who is so sick that he or she is voluntarily going from a salary to no salary. Doesn't he or she already have enough incentive to continue working? Does increasing the salary help? I think it has escaped these scholar's attention that vocational aid is already available in theory but that state vocational rehabilitation agencies are willing to help very, very few applicants for Social Security disability benefits because they regard rehabilitation as an unachievable goal for the vast majority of these folks.] The third would let states use disability funds as a block grant and experiment with their own reforms. [Now, we get to what they really want. Ending Social Security disability benefits. Politically, it's a nonstarter.]

Liebman and Smalligan also want to grant the Social Security commissioner more flexibility in administering the program, with the hope that this could reduce costs and target the program more effectively. [What you got in mind? It's not like Social Security Commissioners have been saying that they thought they could cut program costs if they had more flexibility. They're just been asking for more money so they can effectively run the program as it currently exists.]

4) Ease the phase-out: Another possible reform is a $2-for-$1 scheme, in which benefits are reduced by $1 for every $2 increase in a beneficiary’s earnings. [Great idea. Seriously, the current rules are ridiculously complicated. Social Security thinks this is such a great idea that they've embarked on a ten year trial of phase out. Wait, a ten year trial? Why so long? Maybe because they're not really expecting any favorable results from the trial. Social Security work incentives have been endlessly added to and tweaked with no beneficial effect. The problem is that program rules are so tight that disability benefits recipients are too sick to work ever again. Period.] ...

5) Longer waiting period: The CBO [Congressional Budget Office] has considered a variety of cost-saving measures for the plan, ranging from adopting chained CPI to making people 62 or older ineligible. But probably the most likely to change enrollment is a plan to increase the waiting period before benefits from five months to 12 months. That would likely deter people tempted to game the system by increasing the cost of that, but it would also leave genuinely disabled people out to dry to some extent. It would also reduce the cost of the program by 6 percent in 2022. [This idea doesn't save much money. It just bankrupts more people. Why should a person with terminal cancer have a 12 month waiting period? Until you can answer that one, you had better keep this idea toward the bottom of your list. And tell me more about this "gaming" of the system inherent in a five month waiting period. I'm a lawyer who represents these folks. I'd be interested in knowing how I could advise my clients to play this "game.]

Rivlin Award Draws Controversy

     From Michael Hiltzik writing in the Los Angeles Times:

Robert M. Ball is one of the most revered figures in Social Security history, a man whose devotion to safeguarding the program from ideological attacks and political cant over six decades made him the program's "undisputed spiritual leader."

Alice M. Rivlin is a distinguished budget expert at the Brookings Institution whose willingness to promote "entitlement reform" (read: cut benefits) as a deficit nostrum has given her a reputation as a danger to Social Security and Medicare.

So when Rivlin was named the ninth recipient of the annual Robert M. Ball Award for Outstanding Achievements in Social Insurance this week, Social Security advocates erupted in fury.

The critics complain that Rivlin's grasp of social insurance principles is spotty at best. They argue that her tendency to treat Social Security and Medicare as mere expenditure line items to be kneaded into place in a broader deficit policy doesn't meet the award's goals; it's supposed to recognize people who have demonstrated "innovation" or "effectiveness" in furthering public understanding of the programs. 

They have a point. It doesn't help that Rivlin, 82, has affiliated herself with groups funded by hedge fund billionaire Peter G. Peterson, whose hostility to Social Security and Medicare is legendary and who isn't above using ginned-up panic over government deficits as a weapon. 

The main target of the critics' wrath is the National Academy of Social Insurance, which bestows the award and, as it happens, was founded by Ball. The organization created the Ball award in 2004 to honor Ball on his 90th birthday. (He died in 2008.) Some NASI members are talking about resigning in protest.

New Visual Disorder Listings Published

     After a little delay, Social Security's new visual disorder listings are in the Federal Register today.

The "Disability Industrial Complex"

     From All Things Considered on NPR:

There exists today what I'm going to call a Disability Industrial Complex. And Charles Binder had a big hand in creating it. When he started in 1979, Binder and Binder represented less than 50 clients. Last year, 30,000; 30,000 people who were denied disability appealed with the help of Charles Binder - in one year. The firm made $68.7 million in fees.

So you've got 30,000 people denied disability who are appealing to a judge, taking their case to the courts. And on the one side, the judge has a passionate, persuasive lawyer making the case that his client is physically or emotionally incapable of working. And on the other side - who's on the other side? Nobody. Nobody, really.

     I keep pointing out that years ago Social Security tried having someone present at its hearings to represent its position that the claimant wasn't disabled. It was just a waste of money. It didn't reduce the number of people approved. The government representative idea is a zombie. It's deserves to die but it's almost impossible to kill it.

Agenda For Upcoming Conference

Disability Conference

      I know those of you working for Social Security cannot access this from your offices. I'm sorry but you need to ask the IT people at Social Security to drop this ridiculous restriction. You can always access this from at home.

The Assault Continues

     From the Atlantic:

Imagine for a moment that Congress woke up one morning, realized that the United States was suffering from a paralyzing long-term unemployment crisis, and, in a moment of progressive pique, decided to create a welfare program aimed at middle-aged, blue-collar workers.

The one thing everybody could probably agree on is that it should help all those jobless 50-somethings find employment, right?

Well, as NPR's Planet Money argues in an eye-opening story, it turns out there already is a "de facto welfare program" for those struggling Americans. The problem is, instead of getting the unemployed back on their feet, it pays them to give up work for good. 

I'm talking about Social Security's disability insurance program, which over 20 years has quietly morphed into one of the largest, yet least talked about, pieces of the social safety net. Since the early 1990s, the number of former workers receiving payments under it has more than doubled to about 8.5 million, as shown in Planet Money's graph below. More than five percent of all eligible adults are now on the rolls, up from around 3 percent twenty years ago. Add in children and spouses who also get checks, and the grand tally comes to 11.5 million.

NPR Discovers Social Security Disability

     From a story on Social Security disability on National Public Radio:

In the past three decades, the number of Americans who are on disability has skyrocketed. The rise has come even as medical advances have allowed many more people to remain on the job, and new laws have banned workplace discrimination against the disabled. Every month, 14 million people now get a disability check from the government.

The federal government spends more money each year on cash payments for disabled former workers than it spends on food stamps and welfare combined. Yet people relying on disability payments are often overlooked in discussions of the social safety net. People on federal disability do not work. Yet because they are not technically part of the labor force, they are not counted among the unemployed.

In other words, people on disability don't show up in any of the places we usually look to see how the economy is doing. But the story of these programs -- who goes on them, and why, and what happens after that -- is, to a large extent, the story of the U.S. economy. It's the story not only of an aging workforce, but also of a hidden, increasingly expensive safety net....

In Hale County, Alabama, 1 in 4 working-age adults is on disability. On the day government checks come in every month, banks stay open late, Main Street fills up with cars, and anybody looking to unload an old TV or armchair has a yard sale. ...

Over and over again, I'd listen to someone's story of how back pain meant they could no longer work, or how a shoulder injury had put them out of a job. Then I would ask: What about a job where you don't have to lift things, or a job where you don't have to use your shoulder, or a job where you can sit down? They would look at me as if I were asking, "How come you didn't consider becoming an astronaut?" ...

But disability has also become a de facto welfare program for people without a lot of education or job skills. But it wasn't supposed to serve this purpose; it's not a retraining program designed to get people back onto their feet. Once people go onto disability, they almost never go back to work. Fewer than 1 percent of those who were on the federal program for disabled workers at the beginning of 2011 have returned to the workforce since then, one economist told me. ...

PCG is a private company that states pay to comb their welfare rolls and move as many people as possible onto disability. "What we're offering is to work to identify those folks who have the highest likelihood of meeting disability criteria," Pat Coakley, who runs PCG's Social Security Advocacy Management team, told me.

The company has an office in eastern Washington state that's basically a call center, full of headsetted women in cubicles who make calls all day long to potentially disabled Americans, trying to help them discover and document their disabilities: ...

There's a reason PCG goes to all this trouble. The company gets paid by the state every time it moves someone off of welfare and onto disability. In recent contract negotiations with Missouri, PCG asked for $2,300 per person. For Missouri, that's a deal -- every time someone goes on disability, it means Missouri no longer has to send them cash payments every month. For the nation as a whole, it means one more person added to the disability rolls. ...

Daytime TV in many places is full of ads from lawyers who promise to fight the government and win the disability benefits you deserve. There are tons of YouTube videos about getting disability -- one lawyer, one webcam. The standard form is a let's-get-real chat about how to win this thing. ...

Who is making the case for the other side? Who is defending the government's decision to deny disability?

Nobody.

"You might imagine a courtroom where on one side there's the claimant and on the other side there's a government attorney who is saying, 'We need to protect the public interest and your client is not sufficiently deserving,'" the economist David Autor says. "Actually, it doesn't work like that. There is no government lawyer on the other side of the room."