BOND Study Offers Further Proof That Work Incentives Don't Work

     There has been a longstanding Congressional wish to encourage those who receive Social Security disability benefits to return to work. Some of this comes from a genuine desire to help the disabled but most of it comes from a desire to reduce the amount spent on disability benefits. This has led to one piece of legislation after another, each one adding a new layer of work incentives. There has been a persistent belief that some tinkering with work incentives will result in more disabled people returning to work. None of this has made a difference. Few Social Security disability recipients return to work. What we have now is a preposterously complex system of work incentives that is difficult for Social Security to administer and impossible for the disabled to understand. Most important, the mess we have now just doesn't work.
     The latest work incentive plan is to dramatically simplify, gradually Social Security disability benefits on account of work earnings from work rather the current systems which allow Social Security disability recipients to work for a significant length of time with no reduction in their benefits until they get to a certain point at which their benefits abruptly terminate (although they're easily restarted). The idea is to implement a slope instead of a cliff. Social Security has been conducting a lengthy study of substituting a benefit offset. The call this the BOND (Benefit Offset National Demonstration) project.
     The agency's Office of Inspector General (OIG) just released a study of the BOND project. Here's an excerpt from the OIG report:

As of January 2015, the BOND project’s total cost was approximately $86.8 million. As of October 2014, only 2,333 (2.7 percent) of the 85,140 BOND project’s participants had used the offset for 1 or more months. Also, Abt [the contractor] reported that the BOND project’s benefit offset did not have a statistically significant impact on average total earnings in 2012 for Stage 1 participants; and the Stage 2 two treatment groups’ average total 2012 earnings increased above the control group by only $279 and $301 (about 8 percent), respectively.

     This is what I expected. The study has been expensive. Few have taken advantage of BOND. It has had no significant effect upon the behavior of Social Security disability benefits recipients.
     The reason why BOND isn't working in the way its supporters envisioned is simple. Social Security disability recipients are quite sick. Few have any capacity to return to work. Those who are unfamiliar with the program visualize claimants getting better and returning to work. However, the one year duration requirement in Social Security's definition of disability means that happens only rarely. If you're sick enough to be disabled for a year or more, it's unlikely that you'll get significantly better at some later time. In fact, it's very likely your medical condition will just get worse as time goes on. Yes, recovery does happen but it's rare. Those who are not familiar with Social Security disability determination also believe that many Social Security disability recipients aren't really that sick. (Why, my barber told me that he heard from his sister that her neighbor got on Social Security disability and there's not a thing wrong with him!) This belief is unshakable. It persists even in those who are disabled themselves and struggling to get on Social Security disability benefits. The truth is that it's ridiculously difficult to get on disability benefits. Many people are incapable of believing this.
     A benefit offset program should be adopted, not because it will induce more disabled people to return to work, but because it will be simpler to implement. We've had one ill-advised work incentive plan after another for decades. They haven't worked and they're not going to work. It's time to stop tinkering.  Have a little consideration for the people who have to administer the program. Simplify.

Is The Social Security Disability Crisis Over?

      Michael Hiltzik at the Los Angeles Times thinks that the Social Security disability "crisis" is over. I'd say that it's a bit early to say that the political battle is over. For that matter, the political battle over the existence of any form of Social Security is far from over as far as many Republicans are concerned.

A Grabbag From OIG

     Social Security's Office of Inspector General issued a group of reports yesterday. Apart from the one I posted about yesterday, I'd say none is important, but here are the others so you can judge for yourself:

• Status of the Social Security Administration's Earnings Suspense File 
• Old-Age, Survivors and Disability Insurance Overpayments Pending Collection
• Congressional Response Report: The Social Security Administration's Anti-fraud Training
• Supplemental Security Income Overpayments Pending a Collection Determination by the Social Security Administration 
• Single Audit of the State of Michigan for the Fiscal Year Ended September 30, 2014 

Hearing Backlog Soars

     From a report by Social Security's Office of Inspector General (OIG):

SSA [Social Security Administration] efforts have not been successful in eliminating the pending hearings backlog nor reducing APT [Average Processing Time] to 270 days. As of March 2015, SSA had about 1 million claims awaiting a decision, and the APT was approximately 450 days. We have identified four factor s that contributed to this worsening situation: (1) an increase in hearing requests, (2) a decrease in administrative law judge (ALJ) productivity, (3) a decrease in senior attorney adjudicator decisions, and (4) a recent decrease in the number of available ALJ. ...

ALJ productivity decreased by 14 percent from FYs 2012 to 2014. ...

After we provided our draft report to Agency managers, they shared the Agency’s eight-point tactical plan outlining SSA’s priorities through the end of FY 2016. One of the plan’s goals was to reduce pending hearings by (1) increasing adjudicatory capacity, (2) improving process and decisional quality, (3) increasing accountability and the focus on aged cases, and (4) leveraging technology improvements. This tactical plan included 35 initiatives. We determined 21 of these 35 initiatives were variations of the initiatives we discussed earlier in the report. Among the other new initiatives, ODAR planned to conduct pre-hearing conferences using SAAs [Senior Attorney Advisors], establish judge-only video hearing sites, and reconsider an earlier regulation stipulating that evidence must be provided 5 days prior to a hearing. The Agency was still finalizing performance measures related to this new tactical plan. ...

     The elements of the tactical plan listed are laughably inadequate. Senior attorney decisions could help a lot but they're only talking about pre-hearing conferences. To use a tired metaphor, this is just rearranging the deck chairs on the Titanic. The problem, in addition to an inadequate budget, is that Social Security is far more worried about accusations that they're "paying down the backlog" than they are about the backlog itself.

I Keep Asking: Does This Look Out Of Control?

     Kathy Ruffing at the Center on Budget and Policy Priorities (CBPP) has compiled a report on the many safeguards against fraud and abuse in Social Security's disability programs. The chart to the left is from the report.

     The report correctly notes that while there is actually little fraud and abuse in Social Security disability that if Congress really wants to do more to combat whatever fraud and abuse there is, the agency should get better administrative funding. For instance, inadequate funding is limiting continuing disability reviews.
     Unfortunately, additional funding is unlikely to happen with this Congress. The GOP is only interested in using the relatively rare cases of fraud or abuse to justify their 80 year old losing battle against the concept of social insurance. They really don't care about the fraud and abuse itself. Good government isn't their thing.

Great Start For Hearings For Eric Conn's Former Clients

     Social Security has just started holding hearings for former clients of Eric Conn who are being threatened with benefit termination. I'm hearing that at least one Administrative Law Judge (ALJ), William Wallis, is refusing to consider or even admit into the record any evidence that is dated after the prior decision. Attorneys are submitting evidence but the ALJ is refusing to make exhibits of the evidence.  This is one way of interpreting the instructions that ALJs have been given that they cannot find that a claimant first became disabled after the prior ALJ decision but is this what Social Security intended? And, of course, the instructions to consider the claimant's condition only up to the date of the prior ALJ decision are clearly at odds with 42 U.S.C. §402(j)(2) but I suppose that the plain language of the Social Security Act doesn't matter when Congressional Republicans demand mass terminations.
     Update: The ALJ refusing to admit any evidence dated after the prior decison is not William Wallis but Sandra DiMaggio-Wallis. ALJ William Wallis might be doing the same thing but I don't have a report about him. By the way, the ALJs hearing these cases have been put into a difficult spot. They've been given weird instructions which many of them may be uncomfortable with. I don't want to be too critical of the ALJs. The problems were created much higher up at Social Security.

Former Social Security Employee Sentenced To 21 Months In Prison For Benefits Fraud

     From the Chicago Sun-Times:

A former Social Security Administration employee was sentenced to 21 months in federal prison Monday for cashing her dead mother’s Social Security checks for almost 30 years.

Georgia Thompson, 68, of Chicago, received $419,644 in fraudulent Social Security benefits from the checks between 1986 and 2014, according to a statement from the U.S. attorney’s office. ...

The Social Security Administration discovered the fraud in 2014 after realizing Thompson’s mother hadn’t used her Medicare benefits in several years, prosecutors said. ...