Proposal To Have AAJs Holding Hearings

     Social Security has asked the Office of Management and Budget (OMB) to approve proposed regulations that would allow Administrative Appeals Judges (AAJs) to hold hearings. The AAJs currently handle cases at the Appeals Council. When you combine this with the recent proposal that video hearings could be forced upon claimants you get an idea of what Social Security has in mind -- the end of Administrative Law Judge hearings. There would be some huge building housing AAJs working away in cubicles holding only video hearings. The AAJs would be subject to intensive review to make sure they tow the party line. Even though Social Security's centralized operations are the most troublesome parts of the agency in my opinion, Social Security management loves centralization. Few people in upper Social Security management have worked in the field. They just distrust field operations. They like putting their eggs in big baskets. 

    Really, does anyone think that the centralized payment centers, the teleservice centers and the Appeals Council are the most efficient parts of Social Security?

Andrew Saul And The MTA

     Andrew Saul's nomination to become Commissioner of Social Security is pending before the Senate but Saul isn't sitting idle. He's very much involved in a big New York City transit controversy.

Ennis Sworn In As Inspector General

     From a press release:

Gail S. Ennis, of Maryland, was sworn in as the Inspector General for the Social Security Administration (SSA) by Acting Commissioner of Social Security Nancy A. Berryhill at a ceremony today. President Donald Trump nominated Ms. Ennis for the position, and the Senate confirmed her nomination on January 2, 2019. ...

Ms. Ennis began her legal career in 1998 as an associate at WilmerHale in the firm’s Securities Department. In 2007, Ms. Ennis became a Partner in the firm’s Securities Litigation and Enforcement practice and later also joined the firm’s Bank Regulation and Enforcement practice. Ms. Ennis’ practice focused on advising companies, boards of directors, audit committees, and special committees of large, multi-national corporations or financial institutions in connection with government and independent investigations related to the federal securities laws, as well as consumer protection laws. She led large teams of lawyers, forensic accountants, IT and discovery professionals, and support staff investigating issues including financial statement reporting and disclosure errors, accounting irregularities, and misconduct by current or former officers or employees. Ms. Ennis also advised clients on improving processes, procedures, and internal controls to avoid future violations or to comply with settlement terms or changes in laws or regulations. Ms. Ennis appeared before the SEC and the Consumer Financial Protection Bureau.

 

Ms. Ennis holds a Bachelor of Science from the University of North Carolina at Chapel Hill and a Juris Doctor from Brooklyn Law School. ...

Why Does This Keep Happening?

     A television station in Nyack, NY reports on a woman who had to go through a long fight to get approved for Social Security disability benefits but didn't receive her back benefits until seven months later and then only after the television station started asking questions. Of course, all this delay caused the poor, sick woman great financial problems.

     I don't know enough about the case to say what happened but I can say the most common cause for this sort of delay is what I call a phantom windfall offset. At the very beginning, when the claimant first contacts Social Security, the field office takes both a claim for Disability Insurance Benefits (DIB) and Supplemental Security Income (SSI). The SSI claim is quickly denied because of excess income or resources. There was no point in the claimant ever filing the claim except that the field office is assigned staff based in part on how many claims they take so they have an incentive to take useless SSI claims. (Yes, I've heard field office staff say, no, they're just trying to protect claimants but I'm not buying it.) Even though it's been denied, the SSI claim remains active in Social Security's computer system. Once the DIB claim is approved, the back DIB benefits aren't paid because the payment center is waiting to find out how much SSI was paid. However, there's no action on the SSI since it was long since denied. The payment center just does nothing. The field office which would implement the SSI if it were being paid and which is supposed to tell the payment center if no SSI is being paid does nothing. Maybe somebody at Social Security realizes there's a problem and resolves it. Maybe nothing happens until the claimant complains. Maybe nothing happens even if the claimant does complain because everybody is so busy. How often do phantom windfall offsets happen? I'd guess a few hundred thousand times a year. Social Security certainly knows about the problem. Why can't they get it fixed? Everybody is just so busy. Problems that cause delays in benefit payments aren't nearly so important as the pointless search for another Eric Conn. (Hint to Social Security: There isn't another Eric Conn out there.)

Growth Of Social Security Online Presence

Rep Payee Rips Off 250 In Alabama

     From a television station in Alabama:

A Tuscaloosa Easterseals worker is facing federal prison time for wire fraud. Court records show Tamara Jean Conwell will plead guilty in the case.  

Conwell worked as a representative payee with Easterseals of West Alabama, where she managed the benefits of nearly 250 social security recipients.  

 Federal prosecutors say she schemed to use more than $105,000 intended for those beneficiaries for her own personal expenses. She has agreed to pay that amount in restitution. ...

Social Security Disability Trust Fund Operations 2017-18

Disability Insurance
(Amounts in billions)

Quarter	Total income	Total outgo	Net increase in asset reserves	Asset reserves at end of quarter
Qtr 1, 2017	$43.9	$36.5	$7.4	$53.7
Qtr 2, 2017	49.1	36.9	12.2	65.9
Qtr 3, 2017	40.0	36.4	3.5	69.4
Qtr 4, 2017	38.0	35.9	2.0	71.5
Qtr 1, 2018	44.7	36.9	7.8	79.3
Qtr 2, 2018	47.0	37.0	9.9	89.2
Qtr 3, 2018	40.6	36.7	3.9	93.1
Qtr 4, 2018	40.1	36.1	3.9	97.1

Notes:

The net increase in asset reserves is total income less total outgo. Data are provided by the Department of the Treasury in monthly reports.

Avoiding FICA Taxes Comes At A Cost

     The Center for Retirement Research at Boston College has a new study out on the problem of FICA tax avoidance by independent contractors and others who make a living in the “gig economy” or by selling online. They estimate it’s costing the Social Security trust funds $6.4 billion per year in lost revenues. They also note that this sort of thing leaves those involved with lower benefit amounts or no benefits once they become disabled or retire. They don’t mention the secondary cost to taxpayers of additional Supplemental Security Income (SSI) benefits paid to those who failed to pay FICA taxes when they were working.