How Does The Economy Affect Disability Claims?

     The abstract of The Effect of Economic Conditions on the Disability Insurance Program: Evidence from the Great Recession by Nicole Maestas, Kathleen J. Mullen and Alexander Strand:

We examine the effect of cyclical job displacement during the Great Recession on the Social Security Disability Insurance (SSDI) program. Exploiting variation in the severity and timing of the recession across states, we estimate the effect of unemployment on SSDI applications and awards. We find the Great Recession induced nearly one million SSDI applications that otherwise would not have been filed, of which 41.8 percent were awarded benefits, resulting in over 400,000 new beneficiaries who made up 8.9 percent of all SSDI entrants between 2008-2012. More than one-half of the recession-induced awards were made on appeal. The induced applicants had less severe impairments than the average applicant. Only 9 percent had the most severe, automatically-qualifying impairments, 33 percent had functional impairments and no transferable skills, and the rest were denied for having insufficiently severe impairments and/or transferable skills. Our estimates imply the Great Recession increased claims processing costs by $2.960 billion during 2008-2012, and SSDI benefit obligations by $55.730 billion in present value, or $97.365 billion including both SSDI and Medicare benefits.

     I think that the factors that affect the filing of disability claims are far more complex than these authors have contemplated. It's obvious from statements made in the body of this study that the authors visualize people being laid off and immediately filing disability claims with Social Security but anyone involved in the disability claim process knows that that's not the way things usually worked then, now or anytime. Whatever the reasons for stopping work, only a small minority of disability claimants file their claims immediately after stopping work. There's usually a gap of at least several months and sometimes several years before people file their claims. When asked why they waited so long, people often answer that they kept hoping their condition would improve. The length of the gap between work ending and disability claim being filed can certainly be affected by the economic status of other people. The disability claim may be precipitated by the layoff of a family member, such as a spouse, who had been supporting the disabled person.
     The length of the gap between leaving work due to illness or injury and filing a disability claim may also be influenced by perceptions of how difficult it is to obtain Social Security disability benefits. One of the reasons people delay filing a claim is that they perceive, somewhat accurately, that it's difficult to be approved for Social Security disability benefits. I know that's not a rational way to act but people are often irrational. I'm pretty sure that the public perception of how tough it is to be approved isn't stable. I got the strong impression that in 2008 and 2009, after Barack Obama was elected President, that people thought it was becoming less difficult to be approved. They were wrong. It didn't get less difficult to get approved but that's what people thought and their misconception affected their behavior. Of course, Obama's election happened at a time when the economy was crashing and was, in part, due to that crash making it impossible to sort out everything that was going on.
     The authors of this study seem to visualize people being laid off from their jobs and then marching in to file disability claims. There are some disability claimants who have recently lost their jobs due to a general layoff but I'd estimate that at less than 10%. Most people who file disability claims, both then and now, made the decision on their own to leave employment due to illness or injury. Some of these decisions may be indirectly induced by their employer's business circumstances. Businesses in financial trouble often try to get more productivity out of their employees. An employee who could handle their job as it had been normally performed becomes unable to perform it when more is expected from them. Some who file disability claims have been fired because they could not do the job. Employer decisions on when to let an employee go on medical grounds can be affected by an employer's business circumstances. Someone who is a borderline employee in good times becomes an unnecessary burden in bad times. 
     I think this whole subject deserves more research and that sociologists need to be involved. At the least, someone needs to do research on how the gap between the date of becoming disabled and the date of filing a disability claim has changed over time. Social Security already has that data. It's just a matter of mining it from their databases. My guess is that that gap went way down in 2008 and 2009.

Representation Rate On Disability Claims

     Below is a report on the rate at which claimants were represented at various levels of appeal on Social Security disability claims in Fiscal Years (FY) 2016 and 2017. This was obtained by the National Organization of Social Security Claimants Representatives (NOSSCR) and published in their newsletter, which is not available online. These numbers have to be as of the date an appeal is filed rather that as of all pending cases. Otherwise, there would be a much greater total number listed for the hearing level.

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     Here is a chart of the representation rate at the hearing level in earlier years. Note that the total representation rate by attorneys and non-attorneys at hearings was around 95% in 2010 as opposed to the 80% shown above. The numbers aren't directly comparable since the 80% figure probably doesn't include claimants who obtained representation after filing a request for hearing but it does make me wonder if the representation rate has gone down. My guess is that it has gone down because of the decrease in allowance rates since 2010 and the effective reduction in attorney fees because the fee cap hasn't been raised. Those who represent claimants have to be more careful about the cases we take on. What was once a marginal case we would took on is now a case we don't take on.

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     By the way, every time I post something about the inadequacy of fees for representing Social Security claimants I always get one or two posts saying something like "If the fees are so low, why don't you just stop representing Social Security disability claimants?" I strongly suspect these posts come from paid shills who are representing interests which are hostile to Social Security in general and to Social Security disability benefits in particular. Really, why would anyone want Social Security disability claimants to be unrepresented unless they felt some animus towards Social Security? Of course, the answer to the question of why I don't stop representing Social Security claimants is that I can still make money doing it; I just have to be much more careful about who I represent. I'm turning away way too many claimants whom I believe have meritorious cases. I fear that many of the claimants I turn away don't pursue their cases because they can't find representation. I'm sure this pleases those who pay the shills but it's not good public policy.

At Least They Improved The 800 Number Service

     My recent post linking to an article about a woman who had tried and tried without success to get through to Social Security by telephone brought this response from a field office manager:

Hi Charles, your message on phones and the individual who called the field really resonated with me as a manager of medium size social security office.

Effective two weeks ago, the SSA administration made the decision to shift call forwarding away from field offices. What does this mean? Essentially the option to go to the 800# number is removed.

We were told that this was done due to an average call time of 35 min at the 800#. Essentially the 800 was not making their PSI (public service indicator).

The result? The result is catastrophic in some office. We've seen our call volume essentially double.  To give you an idea - some regions in the nation are getting to 50% of their calls. For an office like mine, it essentially means losing 2 bodies to the phones.  I'm not complaining but it does seem very short sighted to make this change....when this will single handedly delay things in day to day operations - i.e. appeals, overpayment process , etc.

As you know we struggle to keep up with these alone - this additional change - seems entirely misguided. They have simply shifted calls to meet   a goal - truly a mess. Sorry to remain anonymous but i worry about the repercussion of sharing this information

Sincerely - DM who is worried.

     I have been able to confirm that this report is accurate and that the problem is national.

New Service Of Process Addresses

     The Social Security Administration is announcing changes in the addresses it uses for service of process. This will appear in the Federal Register tomorrow but you can read it today. To explain to lay folks, if you sue someone you have to let them know. This is called service of process. If you're suing Social Security, you have to mail the notice, called a summons, to them. They get to pick what address you send it to. Social Security has made it somewhat complex by having different addresses depending upon exactly which federal court district the lawsuit is filed in. They've now changed some of those addresses.

Single Decisionmaker Test Ending

     Social Security is officially announcing the end of the single decisionmaker test in an announcement in the Federal Register tomorrow.

Suit Filed On SSI In Guam But SSI In Puerto Rico May Be The Bigger Issue At Stake

     From the Guam Daily Post:

Two lawsuits have been filed against the U.S. Social Security Administration challenging the U.S. government's policy of refusing to provide Supplemental Security Income (SSI) disability benefits to American citizens living on Guam.

The lawsuits were filed on behalf of twin sisters Katrina Schaller of Barrigada, Guam; and Leslie Schaller of Greensburg, Pennsylvania. The two complementary federal cases were filed simultaneously on Thursday in both Guam and Pittsburgh, Pennsylvania.

The sisters are 48 years old. Each lives with myotonic dystrophy, a debilitating, degenerative genetic disorder that severely inhibits muscle function and other critical aspects of daily life.

Although Leslie Schaller is able to live independently in Pennsylvania due to the aid she receives from SSI, Katrina is ineligible for the same SSI benefits received by her twin because she lives on Guam with her older sister and brother-in-law. ...

According to a release from the law firm, the SSI law limits benefits to American citizens who live "in the United States," which is defined in the law as being the 50 states, the District of Columbia and the Commonwealth of the Northern Mariana Islands, but not Guam.

     Guam doesn't matter much. There aren't enough potential SSI recipients there. Well, it certainly matters to Katrina Schaller and a number of other Guamians but there aren't enough of them to be very costly. Puerto Rico would matter a lot because it's far bigger. I don't know exactly what the cause of action is in this Guam case but I don't see how a court could easily distinguish Guam from Puerto Rico. Other than one being in the Caribbean and they other in the Pacific, the main difference is that Puerto Rico is a lot bigger than Guam.
     By the way, I had no idea that SSI was available in the Northern Marianas. What's the rationale for making it available there but not in Guam or Puerto Rico? That really sounds arbitrary. This lawsuit would have been set up perfectly if one sister was in Guam and the other in the Northers Marianas.

Looking Forward To The First Social Security Subcommittee Hearing Where Andrew Saul Testifies

     I thought I would dig up three old posts I made in 2007 concerning appearances of Michael Astrue, who had recently taken over as Commissioner of Social Security, before the House Social Security Subcommittee which had recently passed from Republican to Democratic control. See any parallels to today? Of course, I'm assuming that Andrew Saul will be confirmed as Commissioner. That hasn't happened yet but there seems to be no obstacle to that happening. A few things are different today, however. Michael Astrue came into those hearings with a history of solid accomplishment in other positions that gave him far more credibility with Subcommittee Democrats than Andrew Saul will enjoy. While service overall at Social Security is terrible, the hearing backlog, while still too high, has gone down recently, reducing the impact of one important flashpoint. One important difference is that Michael Astrue's predecessor as Commissioner, Jo Anne Barnhardt, another Republican, was a snake oil salesperson whose deceptions eventually caught up with her. Subcommittee members were still mad about Barnhart's mismanagement in 2007 even though she was gone. At least Saul won't have that legacy to deal with.

February 14, 2007:

The heated nature of the Social Security Subcommittee hearing today on disability backlogs should be making it clear to the Commissioner of Social Security that he will have to do something about those backlogs or Subcommittee members will make his life very difficult.

Representative Stephanie Tubbs Jones of Ohio pressed Commissioner Astrue on why Social Security had not hired more ALJs and demanded to ask questions about this of Deputy Commissioner Linda McMahon, who was along but not scheduled to testify. McMahon said she has been told that the Office of Personnel Management (OPM) is nearly done with a new register from which ALJs could be hired -- after a ten year delay. Jones made no effort to hide her anger about the situation and said at one point that she did not want to hear any more "crap" about regulations and (OPM) holding up getting more ALJs.

Representative Pomeroy of North Dakota said that he thought he had been "lied" to by former Commissioner Barnhart and others about the problems in hiring more ALJs. He said that he wants a Subcommittee hearing with the Director of the Office of Personnel Management and former Commissioner Barnhart as well as the current Commissioner testifying so that he could get to the bottom of why more ALJs have not been hired. Representative Pomeroy talked about the incompetence of OPM and called it a "god-damned outrage."

If anything, my summary understates just how angry Jones and Pomeroy were. I would not want to be the director of OPM if there is another hearing on the ALJ register issue -- and there probably will be.
Even the ranking Republican member, Sam Johnson of Texas, referred to the OPM situation as insanity.

 February 15, 2007:

I want to thank Representatives Jones and Pomeroy for their intemperate outbursts at yesterday's Social Security Subcommittee hearing. In a narrow sense, their remarks were unfair to the current Commissioner of Social Security and their criticisms were misplaced, but in a larger sense hitting the Commissioner with a verbal two by four was exactly the right thing to do.

Their remarks were unfair to Commissioner Astrue because he had just started on his job two days earlier. He can hardly be blamed for any mess at Social Security. It is a wonder that he was willing to show up for any Congressional hearing when he may not have even finished filling out his W-4.

The criticisms were also misplaced. Jones and Tubbs were focusing upon the narrow issue of why the Office of Personnel Management has still not produced a new register from which Social Security could hire Administrative Law Judges (ALJs) after having worked on the problem for ten years. This is absurd and unbelievable, but the sad fact is that even if OPM had produced a new register eight years ago, things would be little different at Social Security today. The problem is that there has not been enough money in the budget to hire as many ALJs as have been needed. Social Security has been able to hire the limited number of ALJs they could afford off the old register, making a new register less urgent than it might seem at first blush. Of course, Social Security may have told Jones and Tubbs and others in Congress that the problem was OPM instead of the budget or, at least, implied this. Anyone responsible for such a deception should be ashamed.

In a larger sense, there was an urgent need for the Social Security Subcommittee to demonstrate to upper management at Social Security that there is a new sheriff in town and things are going to change. Social Security needs to understand that frankness about the agency's service delivery problems is essential. There can be no more happy talk that minimizes the current problems while promising that some grand plan to be implemented in the future will solve all of Social Security's problems. That is no longer an option. Upper management must realize that Social Security's staffing situation is dire and urgent action is essential. Solutions that were unthinkable last October because they could be criticized as "paying down the backlog" should be urgent necessities today.

 May 3, 2007:

I have posted a good deal on Tuesday's hearing at the House Social Security Subcommittee as well as posted links to accounts in the news media, but there is one subject that I think that I and others have only hinted at and that is the tenor of the hearing.

The head of the Office of Personnel Management (OPM) was bound to catch hell. That was inevitable and justified. However, it was surprising just how much hell Michael Astrue, the Commissioner of Social Security, was catching. Virtually all of the panel members present asked questions of Astrue that suggested a concern about whether Astrue was doing all that he could about the horrendous backlogs at Social Security. None of the panel members was asking softball questions. Representative Tubbs Jones was openly hostile and angry, but Congressman Sander Levin was the most devastating. In a quiet, soft voice Levin said that he did not understand how Astrue and others at Social Security could live with themselves because he felt they were not doing all they could about the backlogs. I really wish I could attach a video of what he said to this blog. Astrue could probably tell himself that Tubbs Jones was just a junior Congressperson who was being a jerk. He cannot dismiss Sander Levin in that way. He is a very senior member and he was expressing great sadness rather than anger.

Why would the Subcommittee members be talking to Astrue like this? He has only been on the job for about two and a half months. Clearly, he is not responsible for the backlogs at Social Security. Everyone who has any familiarity with the situation knows that there are serious limits on what can be done about these backlogs this fiscal year. More budget is clearly needed. Astrue was honest in telling the Subcommittee that the problem with hiring more ALJs has not been OPM but Social Security's budget, which meant that he was telling the Subcommittee that his predecessor had misled the Subcommittee. That should have gotten him some points with the Subcommittee.

There were references to regular meetings between Astrue and the Subcommittee staff. These meetings were referred to as being "frank." The word "frank" is used in diplomacy to indicate open, perhaps angry disagreement. I suspect that "frank" may have been used in the same way to describe the meetings between Astrue and Subcommittee staff. I can only guess at what brought about disagreement, but Astrue's personality probably did not help. Apparently, Astrue may be a bit prickly and he is not the world's best listener. The subjects that are likely to have been the subject of disagreement are Astrue's apparent unwillingness to rapidly expand the ALJ corps, his possible foot dragging on short term measures to keep the hearing backlog from growing (such measures as senior attorney decisions, short form ALJ decisions and re-recon) and his apparent interest in trying to "manage" ALJs.

This hearing was not that far from breaking into a shouting match. If relations between Astrue and the Subcommittee are this bad this early in Astrue's career as Commissioner of Social Security, it is hard to imagine where we are going to be in a year or two. Michael Astrue would be wise to consider carefully how he can improve relations with the Social Security Subcommittee because they have the whip in their hands. Astrue must adjust to them.

Lucia Wasn't The End; It's Just Getting Started

     If you thought that the actions that Social Security and other agencies have taken in response to the Supreme Court's decision in Lucia v. SEC have taken care of all constitutional problems that may be raised concerning Administrative Law Judges, you'd be wrong. The right wing has additional issues that will be brought to a  Supreme Court that may be highly receptive to such arguments. Take a look at this piece by an attorney involved in the litigation. It's going to be one attack after another. Social Security isn't the target. They're getting caught in the crossfire aimed at the SEC, EPA and other regulatory agencies by zealots with extreme libertarian, almost anarchic, views.