A Whistleblower's Tale

     Michael James Keegan, who was formerly Social Security's Associate Commissioner for Facilities and Supply Management testified yesterday before the Senate Committee on Homeland Security and Governmental Affairs. Here are some excerpts from his written statement:

In January 2012, I was assigned as the Project Executive for the construction of a replacement data center in Urbana, MD. ... The center piece of the justification presented to Congress was that the National Computing Center building was beyond economical repair, in terrible condition and had to be replaced in totality. Additionally, SSA officials testified that it was legally required that the new data center be located at least 35 miles from the existing National Computing Center in Woodlawn, MD....

[In early 2013] I gave [my supervisor] a detailed briefing on serious issues that I believed included misleading Congress, waste and abuse. They included:

1. The case to replace the existing National Computing Center (NCC) was “overstated” and relied too heavily on the premise that the NCC was in “terrible condition” and could no longer support the agency mission.

2. The rationale and references used to justify relocating the new National Support Center (data center) 35 miles from the existing campus were very “broadly” interpreted at best and not applicable at all in my opinion.

3. Retention of the existing NCC building was absolutely essential to house the ~925 employees who must remain when the data center function was relocated.

4. In working with GSA [General Services Administration, which has jurisdiction over federal buildings], SSA [Social Security Administration] staff and reviewing historical files, I had discovered that SSA has awarded hundreds of millions of dollars in poorly developed and in many cases, unneeded projects.

5. That prior to my arrival there had been no controls on travel and that many OFSM [Office of Facilites and Supply Management] employees have traveled widely across the United States to various SSA locations without adequate justification or business purpose.

6. My efforts at reducing overtime from ~60,000 hours in 2011 to ~25,000 hours in 2012 had revealed significant abuses and unsubstantiated use of overtime inconsistent with SSA policies. The impact of my work yielded a reduction in overtime expenditures from 2011 to 2012 of approximately $2,500,000. ...

On April 26, 2014 I was called by [my supervisor] and he instructed me as follows:

* I am to "forget" the issues that I brought to his attention.

* That "he" will handle this with no specifics what that meant.

* That I will no longer be required at the quarterly Congressional staff briefings before the House Ways & Means Committee, Subcommittee on Social Security. ...

[O]n May 2, 2013, I was summoned to a short notice meeting with [my supervisor]. He proceeded to tell me that I was being placed under formal investigation due to unspecified "complaints".

On May 21, 2013, [my supervisor] appeared in my office and informed me that I had been relieved of my duties and that I had 30 minutes to clear out my office. Additionally, I was given a direct order not to communicate with any of my employees. I was then directed to report to the Operations organization in a temporary assignment.

During the period from May 21st until early December, I was confined to an empty office with little or no work to do, no responsibilities and very little contact with other SSA employees. I made numerous requests for updates and status on the "investigation" however [my supervisor] did not respond to any of my inquiries. ...

The alleged genesis of the investigation SSA launched against me was done solely to retaliate against me. According to [my supervisor], the decision to have me investigated happened after he met with Cynthia Ennis, AFGE [American Federation of Government Employees] Union president at SSA, who provided him a number of written complaints against me.  ...

My job at SSA was not to be liked by employees. The American taxpayer didn't pay me to accomplish that goal. SSA is not a country club or someone's living room. It's an Agency tasked with administering benefits to the elderly and disabled. It's there to serve our citizens, rather than our citizens serving SSA management. ...

In summary, despite the fact that I had a flawless 44 year performance history including two superior performance reviews (2011 and 2012) at SSA, I was forced to retire in disgrace,dishonor and financial hardship due to the fact that I choose to do the right thing and report fraud, waste and abuse.

      Is he a whistleblower revealing serious problems at Social Security? Is he a crank? Is he some of both? That's the problem with whistleblowers. It's hard to know.

Effect Of Eliminating The F.I.C.A. Wage Base Cap

     If you've been looking for an actuarial study of the effect of eliminating the cap on wages covered by the F.I.C.A. tax and allowing those extra wages to be considered in determining Social Security benefit payments, Social Security's Chief Actuary has you what you need. See the table below but note that the proposal would also change Social Security's COLA to the CPI-E index. The "E" is for elderly. That change would increase the COLA. Eliminate consideration of the additional wage base in benefit computations and stick with the current COLA and the Trust Fund reserves stay in balance almost as far as can be computed.

Noah Didn't Need No Stinking Social Security!

     A quote from Greg Gianforte, Republican candidate for governor of Montana:

There's nothing in the Bible that talks about retirement. And yet it's been an accepted concept in our culture today. Nowhere does it say, "Well, he was a good and faithful servant, so he went to the beach." It doesn't say that anywhere.

The example I think of is Noah. How old was Noah when he built the ark? 600. He wasn't like, cashing Social Security checks, he wasn't hanging out, he was working. So, I think we have an obligation to work. The role we have in work may change over time, but the concept of retirement is not biblical.

Social Security Subcommittee Schedules Hearing On Return To Work

     From a press release:

Today, House Ways and Means Social Security Subcommittee Chairman Sam Johnson (R-TX) announced that the subcommittee will hold a hearing on the Social Security Administration’s (SSA) management of earnings reports from disability beneficiaries trying to go back to work. The SSA faces difficulties processing earnings reports and adjusting benefits in a timely fashion, in part due to the complexity of the work incentives in the Disability Insurance program. These difficulties can cause large overpayments for disability beneficiaries trying to return to work. The hearing will take place on Tuesday, June 16, at 2:00 PM in room B-318 of the Rayburn House Building.

Upon the announcement, Chairman Johnson said, “There are two problems for the American taxpayer when Social Security can’t manage earnings reports: First, dollars go out that shouldn’t; Second, individuals who want to work are discouraged from doing so. It’s time Congress takes a look at what drives overpayments. The American people want, need, and deserve nothing less.”

     If this Subcommittee wants to do something truly useful and bipartisan, it should simplify Social Security's work incentives. There has been one piece of legislation after another over decades based upon the fantasy that just one more incentive will cause Social Security disability recipients to go back to work in droves. It hasn't happened. It's not going to happen. It's just too hard to get on Social Security disability benefits. Realistically, few recipients have the capacity to return to regular employment. The work incentives have been added onto so many times that they're a confusing mess which is almost impossible to administer. Simplify. Simplify. Simplify. Don't do it in the belief that simplification will return more people to work. Simplify so that the system of work incentives can be effectively administered.

When Will We See The Trustees Report?

     When will we see the report of the Social Security Trustees? Last year it was released on July 28. In 2013, it was released on May 31. In 2012, it was released on April 23. When will it be this year? August?

     This is ridiculous. I'm sure that the main part of the report, the projections of Social Security's Chief Actuary, was ready months ago. Last year, there were rumors of wrangling behind the scenes. The Republican trustees were pushing some obscure agenda on exactly what the report would say. I never understood what the Republican Trustees were trying to achieve. What little I could understand seemed to amount to nothing anyway. Is there another controversy this year as Republicans push some language that would make the Trust Funds look like they're a little worse off than the language the Democratic Trustees would prefer? If so, it's silly. Virtually no one pay attention to anything other than the bottom line and few people pay attention to that. This isn't legislation where every word can make a difference.

Busted!

     I have written before to warn that some comments on this blog appear to have been authored by a person or person who pretends to be a current or former Social Security employee with actual knowledge of conditions at Social Security. There are a fair number of these posts which ring false to me but I only call out those that go beyond implausible. Here's one:

One case I remember was a mother receiving SSI benefits for a year and a half for a child she had given up for adoption at birth. Benefits were ceased for failure to cooperate. I had the case at the recon level (of course Mom asked for benefit continuation) and discovered this to be the case when I wrote to the hospital where the baby was born and the pediatrician they sent records to. Not only was there fraud on her part but her parents and other relatives withheld information.

     Let me list the problems here:

• How does the birth mother get SSI benefits for a child she gave up at birth? The child would have to be quite sick. How would the birth mother know what was wrong with the child? How would she know where the child was being treated? Without this information, the birth mother can't get benefits. I can imagine the possibility of an open adoption where the birth mother would have some of this information so I'll just call this improbable.
• Doesn't the disability examiner notice the adoption when reviewing the medical records at the time the claim is filed? I have seen medical records on sick children. Pediatricians pay attention to the parents of sick children and mention facts like adoption in the medical records. In the case of a very sick child, I'm expect that adoption would be prominently mentioned in the medical records. Maybe the disability examiner missed this but it's improbable.
• Why would benefits be ceased for failure to cooperate a year and a half into benefit payments? Normally, a denial for failure to cooperate is something that happens when a case is first being adjudicated. This could happen but it's another improbability.
• The person writing this is posing as a current or former Social Security field office employee but says that he or she wrote to the hospital where the baby was born. That's not something that field office employees do. It's hard to imagine why the field office employee would even want to do this. This one is highly improbable. It sounds like it was written by a person lacking a firm grasp of the role of the field office versus the role of disability determination.
• Most important, there's no benefit continuation for a failure to cooperate cessation. This one is beyond improbable. It's impossible. Even if benefit continuation did exist for this circumstance if the birth mother could ask for benefit continuation she could certainly avoid cessation for failure to cooperate. Again, this sounds like it was written by someone who lacks a firm grasp of basic Social Security law and procedure.

     Be careful when reading comments to this blog. Some commentators are pretending to have knowledge they lack. This seems to happen every time I write about anything relating to the incidence of fraud at Social Security. The poseurs could be Congressional staffers. They could be "think tank" employees. They could simply be paid shills and, yes, people are paid to write comments like this on blogs and newspaper articles. Posing as a government employee with inside knowledge is a common tactic.

Many Allegations But Little Substance

Here's a table from a recent report filed with Congress by Social Security's Office of Inspector General (OIG). Notice the huge disparity between the number of allegations received and the number of actual investigations much less criminal convictions. No, I don't think that disparity is because OIG fails to aggressively pursue cases of fraud. I think it's because there's little substance to most allegations of fraud. Republicans can spin it all they want but given Social Security's size, the amount of verifiable fraud at the agency is tiny.

Misleading AP Story On Overpayments

     Here's the lead sentence from the AP article on the Office of Inspector General (OIG) report on overpayments in Social Security's Disability Insurance Benefits program "Social Security overpaid nearly half the people receiving disability benefits over the past decade, according to a government watchdog, raising questions about the management of the cash-strapped program."

     This could have been the AP lead sentence "Only 3% of Social Security disability benefits are paid incorrectly and the Social Security Administration is able to recoup 85% of the benefits paid incorrectly." That's also what the OIG report showed. Of course, that wouldn't have been the lead sentence because it's boring. It also wouldn't have been the lead sentence because the AP writer was clued into the OIG report by some Republican operative who heavily emphasized the "nearly half" part even though it's misleading. 

     Let's say there was a study showing that over a 10 year time period 22% of drivers were caught driving drunk at some time. There isn't such a study as far as I know but let's say there was. Would it be fair and reasonable to have the lead sentence on an article about that study that reads "Nearly a quarter of all people who drove over the last ten years were found to be driving drunk, raising questions about law enforcement on our dangerous highways." I would say no. First, 22% isn't nearly a quarter, any more than 44% is nearly half. More important, if 22% of drivers have been caught driving drunk, law enforcement is doing its job in catching people driving drunk. There's no reason to question what law enforcement is doing. For the same reason, there's no reason to question the Social Security Administration's efforts to detect and prevent overpayments. Most important, the hypothetical lead sentence is misleading since it suggests that at any given time that nearly one quarter of drivers are drunk and that's not what the hypothetical study showed. By the same token, the OIG didn't show that at any given time 44% of benefits recipients are being overpaid as the AP story implies. The AP story is misleading.