This Article highlights the fact that the taxability of Social Security disability benefits paid in a lump sum causes problems for many taxpayers -- and the writer was apparently unaware of the lump sum election or of the fact that long term disability benefits are actually taxable for most people since they come as an employee benefit.
Jul 25, 2014
A Mess At The Appeals Council
An e-mail I received recently from another attorney who represents Social Security disability claimants:
I ran my periodic ERE [Electronic Records Express, which is one of the several names used for Social Security's online system for those who represent claimants] "status reports" this morning and noticed that the Appeals Council had denied one of my cases. Problem was, the denial date was listed as 6/4/2014 - and neither I nor my client had ever received anything in the mail regarding the denial. I promptly called up to Falls Church [which is where the Appeals Council is located] to see what the hell was going on, and the very nice representative told me that I was his fourth call of the day regarding this exact issue. He said that the case was indeed denied, but that for some inexplicable reason no one bothered to mail out the decision. The representative said he has personally fielded dozens and dozens of calls over the past few weeks about this. He said that he would make sure that a new denial - with the appropriate date - would be mailed out in the next few days.
Jul 24, 2014
Social Security Facing A Challenging Budget Situation
From the prepared remarks of Marianna Laconfora, the Acting Deputy Commissioner for the Office of Retirement and Disability Policy, at the Senate Finance Committee hearing today:
During FYs 2011 - 2013, our budget situation was severe . For 3 years in a row, we received nearly a billion dollars less than the President’s budget request. Over those years, we had to make some deep reductions in our services to the public and in our stewardship efforts, while still meeting our mission and serving the public as best as possible . We took the following actions.
We significantly limited hiring, with only minimal hiring in critical front - line areas;
Reduced the hours that our field offices are open to the public to allow us to complete late - day interviews without using overtime and to complete retirement and disability claims and other post - entitlement work;
Operated with minimal, non - personnel spending, only funding our most essential costs, such as mandatory contracts, guard services, and rent on our buildings;
Closed over 500 contact stations and 7 foreign service posts;
Increased our use of video hearings to improve service and lower travel costs ;
Suspended our lower priority notices and reduced the number of Social Security Statements issued; and
Provided more information online to reduce printing and mailing costs .
As a result of significantly limited hiring, wait times in field offices increased, callers to our 800 Number had to wait longer to speak with a representative, and hearings processing time increased. In addition, we were not able to ramp up our cost-effective program integrity efforts as planned.
We are pleased that we received additional resources in FY 2014, and we thank you for your support. As a result, we are able to begin the recovery efforts from 3 years of underfunding. However, it will take time to reverse the impact on service s from the years of underfunding. It is critical that we receive the level of funding requested for our agency in the President’s FY 2015 Budget.
"Boondoggle" At Social Security
A story from ABC (update: actually, this is an AP story which ABC didn't properly attribute) bearing the title "Social
Security Spent $300M on 'IT Boondoggle'"
Six years ago the Social Security Administration embarked on an aggressive plan to replace outdated computer systems overwhelmed by a growing flood of disability claims. Nearly $300 million later, the new system is nowhere near ready and agency officials are struggling to salvage a project racked by delays and mismanagement, according to an internal report commissioned by the agency.
In 2008, Social Security said the project was about two to three years from completion. Five years later, it was still two to three years from being done, according to the report by McKinsey and Co., a management consulting firm.
Today, with the project still in the testing phase, the agency can't say when it will be completed or how much it will cost. ...
As a result, agency leaders have decided to "reset" the program in an effort to save it, the report said. As part of that effort, Social Security brought in the outside consultants from McKinsey to figure out what went wrong.
They found a massive technology initiative with no one in charge — no single person responsible for completing the project. They issued their report in June, though it was not publicly released.
As part of McKinsey's recommendations, acting Social Security Commissioner Carolyn Colvin appointed Terrie Gruber to oversee the project last month. Gruber had been an assistant deputy commissioner. ...
The revelations come at an awkward time for Colvin. President Barack Obama nominated Colvin to a full six-year term in June, and she now faces confirmation by the Senate. Colvin was deputy commissioner for 3½ years before becoming acting commissioner in February 2013.
The House Oversight Committee is also looking into the program, and whether Social Security officials tried to bury the McKinsey report. In a letter to Colvin on Wednesday, committee leaders requested all documents and communications about the computer project since March 1. ...
The troubled computer project is known at the Disability Case Processing System, or DCPS. It was supposed to replace 54 separate, antiquated computer systems used by state Social Security offices to process disability claims. As envisioned, workers across the country would be able to use the system to process claims and track them as benefits are awarded or denied, and claims are appealed.
But as of April, the system couldn't even process all new claims, let alone accurately track them as they wound their way through the system, the report said. In all, more than 380 problems were still outstanding, and users hadn't even started testing the ability of the system to handle applications from children. ...
Maryland-based Lockheed Martin was selected in 2011 as the prime contractor on the project. At the time, the company valued the contract at up to $200 million, according to a press release.
This project is a genuine problem and a serious one which deserves Congressional scrutiny but this piece reads almost as if it had been written by Darrell Issa's staff. How could this be an obstacle to Carolyn Colvin's confirmation as Social Security Commissioner? She didn't begin this project and wasn't in charge until late in the game. She's taken action to try to right the ship. How's this her fault? This piece doesn't mention the name of Michael Astrue, the Republican who was Commissioner of Social Security until last year. If you're going to put the blame on anyone, and I'm not sure you should, Astrue would be the top candidate. The name of the contractor, Lockheed Martin, which has excellent Republican connections, isn't mentioned until the 16th paragraph. Did Issa's staff write this piece? ABC shouldn't allow the mindless partisanship of Darrell Issa to infect its reporting.McKinsey's report does not specifically fault Lockheed but raises the possibility of changing vendors, and says Social Security officials need to better manage the project.Gruber said Social Security will continue to work with Lockheed "to make sure that we are successful in the delivery of this program."
Colvin Confirmation Hearing Scheduled For July 31
The Senate Finance Committee confirmation hearing on Carolyn Colvin's nomination to a term as Commissioner of Social Security has been scheduled for July 31at 10:00.
Jul 23, 2014
West Palm Beach Employees Suing Building Owner
The bizarre West Palm Beach saga continues. From the local television station:
Almost two dozen employees of the West Palm Beach Social Security Administration’s office are suing the building’s owner.
CBS 12 News has obtained a copy of a lawsuit filed last year in which 22 employees and a security guard claim the building made them sick.
As CBS-12 News was first to report, staff at the West Palm Beach SSA branch are being dispatched to other SSA offices as the agency looks for a new building to house their operation.
The move stems from what the SSA alleges are problems with the building which is leased to the government by Carnegie Management and Development Corporation.
In the 118 page complaint filed last year, the staff members allege the building had substantial water leaks causing extensive water intrusion; that in 2009, mold, mildew and fungus were discovered inside the building; and that staffers suffered damages including mental pain and suffering, permanent injury and loss of earnings.
Carnegie Management and Development CEO Dr. Rustom Khouri says the claims are absolutely bogus.
Trustees Report Will Be Out By July 28
The National Academy of Social Insurance has scheduled an event for July 28 at which Social Security's Chief Actuary, Stephen Goss, will discuss the 2014 Social Security Trustees Report.
Ready To Start Down This Path?
The United Kingdom has started a big effort to force disabled people off benefits and get them back to work. The BBC tells us that things haven't been going so well. A recent report of the House of Commons says that changes need to be made "immediately." The contractor hired to get people back to work was "not achieving its purpose of getting people back to work" and has been fired. There won't be a replacement contractor until next year. An executive of one non-profit helping disabled people called the program "a shambolic and hopeless system that cruelly penalises the most vulnerable amongst us."
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