When You Don't Know What Else To Say, Just Use The Old Pending Litigation Dodge

     From the Washington Post:

The Social Security Administration, which announced in April that it would stop trying to collect debts from the children of people who were allegedly overpaid benefits decades ago, has continued to demand such payments and now defends that practice in court documents. 

But although some people whose refunds were seized were reimbursed in recent months, some of those same taxpayers have since received new demands from Social Security, asserting that the debts remain and seeking repayment. ... 

Asked to explain the about-face, Social Security officials said they would respond only to written questions. Late Friday, four days after The Post provided questions, the agency issued this statement from spokesman Mark Hinkle: “We are finalizing our review of the Treasury offset program, but cannot discuss specifics due to the pending litigation.”

Colvin Nomination On Senate Floor; GOP Can't Block It Now

     I don't know when it will come up for a final vote but Carolyn Colvin's nomination for a term as Commissioner of Social Security is being considered by the Senate today. Republicans lack the votes to prevent confirmation so it's going to happen.

     Update: Colvin has Ted Cruz to thank for her impending confirmation. Seriously.

What's Going On With The Binder And Binder Bankruptcy?

     I have no inside information about the impending Binder and Binder bankruptcy but I think I can give the most likely answers to three key questions.

Is Binder and Binder going out of business?

Not now. In Chapter 11 the debtor stays in business and tries to reorganize. Maybe Binder and Binder can reorganize so they can stay in business indefinitely but I would be surprised if they can. My guess is that they stop taking cases and work down the cases they already have. That would take around three years. Their expenses would drop dramatically since they would no longer be paying for advertising and they could start laying off employees but their gross receipts would stay almost the same for a couple of years. They would be making money as they wind down. Maybe they could hope to crank up the ads later if times got better.

Why is Binder and Binder going bankrupt?

In the best of times, representing Social Security claimants is a high overhead, low profit margin business. This is the worst of times to be representing Social Security claimants. There is almost no profit to make. Add in the fact that Binder and Binder owes about $40 million and the question isn't why they're going into bankruptcy but how they've stayed in business so long. This comes as no surprise to me.

Why is it such a tough time to be representing Social Security claimants?

Social Security's Administrative Law Judges are approving a much lower percentage of disability claims than they did a few years ago. Because of inadequate staffing backlogs are climbing rapidly at Social Security. If you think this means that Binder and Binder should be doing better since their fees would be increased by the delay, you'd be naive. The slowdown in getting to the eventual payday completely overwhelms the importance of the somewhat larger paycheck. If the backlog gets two months longer over the course of a year, you lose two months of gross income but your expenses are largely unchanged. A 5% or 10% larger fee isn't nearly enough to make up the difference.

I Was Kind Of Expecting This

     Binder and Binder may be about to enter Chapter 11 bankruptcy.

Colvin Nomination May Soon Come Up For Vote In Senate

     There are signs that Carolyn Colvin's nomination for a term as Commissioner of Social Security is a matter of some priority with Senate Democrats. She is currently the Acting Commissioner. Her nomination is apparently considered as being on the same plateau as lifetime judicial nominations. There is a rumor that it may come up on the Senate floor as early as today but it's not on the calendar at this time.

GAO Report Urges More Efforts To Find Fraud To Satisfy GOP

     From a report by the Government Accountability Office done at the behest of the Chairman of the House Social Security Subcommittee and the Ranking Member of the Senate Finance Committee:

The Social Security Administration (SSA) has policies and procedures in place for detecting and preventing fraud with regard to disability benefit claims. However, GAO identified a number of areas that could leave the agency vulnerable to physician-assisted fraud and other fraudulent claims:

• SSA relies heavily on front-line staff in the offices of its disability determination services (DDS)—which have responsibility for reviewing medical evidence—to detect and prevent potential fraud. However, staff said it is difficult to detect suspicious patterns across claims, as directed by SSA policy, given the large number of claims and volume of medical information they review. Moreover, DDS offices generally assign claims randomly, so staff said it would only be by chance that they would review evidence from the same physician.

• SSA and, in turn, DDS performance measures that focus on prompt processing can create a disincentive for front-line staff to report potential fraud because of the time it requires to develop a fraud referral. Four of the five DDS offices GAO visited count time that staff spend on documenting potential fraud and developing fraud referrals against their processing time. Some staff at these DDS offices said this creates a reluctance to report potential fraud.

• The extent of anti-fraud training for staff varied among the five offices GAO visited and was often limited. SSA requires all DDSs to provide training to newly hired staff that includes general information on how to identify potential fraud, but does not require additional training. The five DDS offices GAO visited varied in whether staff received refresher training and its content—such as how to spot suspicious medical evidence from physicians—and staff at all levels said they needed more training on these issues.

• SSA has not fully evaluated the risk associated with accepting medical evidence from physicians who are barred from participating in federal health programs. Although information from these physicians is not necessarily fraudulent, it could be associated with questionable disability determinations.

SSA has launched several initiatives to detect and prevent potential fraud, but their success is hampered by a lack of planning, data, and coordination. For instance, SSA is developing computer models that can draw from recent fraud cases to anticipate potentially fraudulent claims going forward. This effort has the potential to address vulnerabilities with existing fraud detection practices by, for example, helping to identify suspicious patterns of medical evidence. However, SSA has not yet articulated a plan for implementation, assigned responsibility for this initiative within the agency, or identified how the agency will obtain key pieces of data to identify physicians who are currently not tracked in existing claims' management systems. Furthermore, SSA is developing other initiatives, such as a centralized fraud prevention unit and analysis to detect patterns in disability appeals cases that could indicate fraud. However, these initiatives are still in the early stages of development and it is not clear how they will be coordinated or work with existing detection activities.

     It could be that there really isn't much fraud and that extensive efforts to find it wouldn't be cost effective. 

Threat Of A Shutdown

     The federal government will shut down tomorrow if Congress cannot agree on a continuing resolution to fund the government. 

     The last time there was a shutdown, which was just last year, almost all Social Security employees were told to keep working. The major exceptions were employees of the Office of Disability Adjudication and Review (ODAR) other than the Administrative Law Judges (ALJs) and most of the Office of General Counsel (OGC). Even without passage of a funding bill almost all the ODAR employees were recalled. The OGC employees were recalled just before passage of the continuing resolution. Social Security asked the state Disability Determination Services (DDS) to stay open and they did for a time but some started closing down as the shutdown continued. 

     I expect that Social Security employees were told today whether they should come to work tomorrow if there's a shutdown. What's the plan this time in case there's a shutdown?

     By the way, when's the next federal payday? If the shutdown, if it happens, is still going on at that time, no paychecks can be issued even for employees who have been told to work.

OIG Report

     Social Security's Office of Inspector General (OIG) has released its Semiannual Report to Congress. In Fiscal Year 2014 OIG received 121,461 allegations, opened 8,335 cases and get 1,291 criminal convictions. This is for a program that pays benefits to 63.2 million people. Only 6% of the allegations had enough substance to be worthy of an investigation. Only about 1% of the allegations resulted in a conviction. Whatever fraud there is at Social Security should certainly be investigated and prosecuted but it's only a tiny, tiny part of Social Security.