Important Change For Disabled People With Federal Student Loans

     I missed that the big tax bill passed at the end of 2017 contained a change that benefits some disabled individuals. You were already able to get a federal student loan discharged if you are disabled and Social Security had set a five to seven year re-examination date for you. However, the discharge of the debt was considered income to the disabled person which often meant that the discharge could cause an expensive tax liability, which defeats the purpose of giving the discharge in the first place. That was changed at the end of 2017 by 26 U.S.C. §108(f)(5)(A), which provides that the discharge of a student loan debt for this reason is not income. However, this sunsets after 2026 but I doubt it will be allowed to end then.

     Unfortunately, the five to seven year re-examination date requirement limits the value of this. I don't know what the numbers are but I'm pretty sure that few who are found disabled by Social Security get a five to seven year re-examination date even though very few have a realistic hope of getting better. I don't know that there are any re-exam dates that long for any sort of mental illness other than profound brain injury.

Full Retirement Age To 80?

     A Forbes contributor thinks that Social Security’s full retirement age should be raised to 80!

Wait Time To Get Hearing Still High

     From a press release:

The national average wait time for a Social Security Disability Insurance (SSDI) benefits hearing is 538 days, according to Allsup, which has released its latest state-by-state ranking of the hearing backlog. Allsup is the nation’s premier disability representation company. 

At year-end, 801,428 people were waiting for a hearing to determine whether they would be awarded their benefits. Overall, the national average wait time has decreased 67 days from an all-time high of 605 days in 2017. The decrease in hearing processing times is due partly to funding received by the Social Security Administration (SSA) in 2018, aimed at tackling the disability hearing backlog.

The highest wait times still top 600 and 700 days in many cities, including 724 days in Long Beach, California; 706 days in New York City; 690 days in Greensboro, North Carolina; 689 days in Phoenix (North); and 684 days in Fresno, California. ...

     By the way, I'm old enough to remember when it took three months to get a hearing. Those who talk as if anything under a year is a dangerous rush to judgment are nuts. We need a dramatic speedup. It's not reasonable to expect people to wait so long.

Rep Payee Steals From Ten In Oregon

     From KPTV:

A Madras [OR] woman pleaded guilty Tuesday to stealing tens of thousands of dollars in Social Security payments from disabled adults, the U.S. Attorney’s Office in Oregon says. ...

Court documents state Tucker beginning in March 2014 worked for a social services organization in Madras where she oversaw outreach to mentally disabled clients as part of the organization’s mental health program. As part of her work, Tucker assumed representative payee duties for some of her clients’ Title II and Title XVI Social Security benefits, the attorney’s office says. ...

An investigation revealed Tucker had stolen $39,277 from 10 victims, the attorney’s office says. ...

     I don't know how you keep it from happening but there have been too many reports like this.

When Members Of The Ways And Means Committee Speak, Social Security Needs To Pay Attention

    There's an op ed in the Philadelphia Inquirer from an attorney with Community Legal Services, which has a distinguished history of Social Security advocacy, and two members of the House Ways and Means Committee, denouncing the long appeal backlogs at Social Security and the reimposition of the reconsideration step in Pennsylvania.

New Rep Payee Rules

     Social Security has adopted final rules that prohibit persons convicted of certain crimes from serving as representative payees. This is being due to effectuate a law passed by Congress.

Hell For An 81 Year Old Widow

     From Laurence Kotlikoff writing for Forbes:

... Eighty-one year-old, Dolores Cooper, is being financially tortured by Social Security for Social Security's own mistake. On September 19, 2018, Dolores called Social Security to tell them her husband, Jimmy, had died two days earlier. The Social Security staffer mistakenly typed into the system that Jimmy had died not on September 17, 2018, but on September 17, 2017. 

One week after Dolores' call, she received a notice from SSA (the Social Security Administration) that Jim had been overpaid by $22,533 and that she, Dolores, needed to make repayment.What happened? The typo triggered Social Security's computer system to decide Jimmy had been paid benefits for a year when he was actually dead, which, of course, he wasn't. Dolores called SSA the next day — on September 27th. After waiting 1.5 hours for someone to come on the phone, she spoke with an Aileen. Aileen found the mistake and told Dolores to take Jimmy's death certificate to the Modesto, CA office. Aileen said it would take up to two months to fix the problem — so not to worry. On October 5th, Dolores took the death certificate to the Modesto office, waited three hours and spoke to Mike Wylie.

To quote her son, Kim, "Mike assured my mom he would make sure the issue was corrected. In the meantime, my mom started receiving tens of thousands of dollars of Jimmy’s medical bills as the incorrect date of death had propagated into the Medicare system and they stopped paying Jimmy’s medical bills and were asking for repayment of their payments. ...

On October 17, SSA sent Dolores two notices. The first stated that they'd used $17,226 of her benefits to recover part of the overpayment, but that she still owed $5,307. Social Security had retroactively activated Dolores' widows benefit to their incorrect start date, namely a year before Jimmy actually died. Those widow's benefits, which hadn't been paid were, SSA said as cryptically as possible, being used to cover $17,226 of her bill.

The second notice dated October 17 notice claimed that SSA, to quote Kim, "... paid Dolores $24,324 for September 2017 through August 2018 but they should have only paid her $10,197 so she need to refund $14,127 within 30 days. The notice also said the total amount of overpayment was $8,820. So in the same notice two different amounts were given ($14,127 and $8,820) and on the same day another notice stated $5,307."

On November 5 SSA made a direct deposit in Dolores' checking account of $8,649. On November 7 the SSA sent a notice stating the deposit of $8,649 should have been for $3,342, so there was an overpayment of $5,307 that needed to be returned. After repeated calls to find out where to send the check, Dolores sent, on November 23, a cashier’s check by priority mail. According to USPS tracking it was delivered on November 27. ...

     The story goes on but you get the ugly picture. What happened isn't a fluke. It's what I would have predicted would happen after the initial mistake was made. The two month prediction on how long it would take to correct the mistake was about what I would have predicted although I would warn a client that it could certainly take longer.
     Mistakes will happen. The problem at Social Security is the lack of staff to correct mistakes coupled with systems set up to be extremely aggressive about collecting overpayments.

A Question

     I'm preparing the 2019 edition of Social Security Disability Practice. One small way that I may update the book is to talk about the new practice in some U.S. District Courts of omitting the claimant's surname from the caption of a case. This is being done to try to protect the privacy of the claimants. 

     This isn't being done in any of the Districts in my state so I'm uncertain about the mechanics. Is the surname omitted in the initial complaint? Is it omitted by the parties only thereafter? Is it only the Court that omits the surname when it files an order?