WEP Options

     The Windfall Elimination Provision (WEP) that reduces Social Security benefits because of the receipt of pensions based upon income not covered under Social Security has been receiving a fair amount of attention lately, perhaps because many of those affected are in red states which are more likely to exclude state employee wages from the F.I.C.A. tax, giving them state pensions instead. The Social Security Bulletin, the agency's scholarly publication, has an article on the WEP and options for replacing it.

Mistaken Identity In Florida

     From First Coast News:

Johnnie Hills, 58, believes he is the victim of mistaken identity. He said proving that to Social Security Administration, however, has been difficult.

"The system is you're guilty until proven innocent and I didn't even do anything," he said.
On July 29, Hills received a letter at his North Jacksonville home from Social Security Administration. The document stated his monthly disability check of $1,600 was being suspended "because he is in prison for the conviction of a crime."

"I was like, 'it can't be me,'" Hill said. "It must be somebody else."

Hills said he made two trips to the local Social Security office to correct what he calls an obvious mistake. He said he found no empathy and no help. 

Hills, who is a former school board employee, was advised to check with the Jacksonville Sheriff's Office for a criminal or prison record. He said there was none.

"The officer told me I wasn't in the system and there was nothing he could do," Hill said. ...

"My bills have gotten behind," Hills said. "They're not going to help me with that. I didn't know who to talk to." ...

     I had one of these cases. My client was approved for Social Security disability benefits but she wasn't paid. The explanation we got was that the client was in prison in New Mexico. My client, who was a free woman in North Carolina, gave a response which I understand New Mexico residents are all too familiar with, "I've never been in Mexico in my life!"  I called the New Mexico prison authorities. They told me that they not only had no prisoner by the same name as my client but that their database didn't show that they had ever had a prisoner by that name. They also didn't have the Social Security number in their database. I gave Social Security the name and telephone number of the New Mexico prison employee I had talked with but they insisted that they couldn't call him. In any case, my client's benefits were soon paid.

Median Lag Time Between Becoming Disabled And Filing Disabilty Claim Was 7.6 Months In 2013-14

     The Social Security Bulletin has an interesting article titled The Time Between Disability Onset and Application for Benefits: How Variation Among Disabled Workers May Inform Early Intervention Policies. Obviously, the article is concerned with how this gap time affects rehabilitation. I don't think the length of the gap time will matter much as far as rehabilitation is concerned are since I think that there are few applicants for Social Security disability benefits who can realistically be rehabilitated. Rehabilitation is a mirage based upon the misconceptions that Social Security disability claimants aren't all that sick or that they many suffer from problems that one can find a way around. 

     The article does give some historic numbers on a topic of interest to me, at least, which is how long people wait after becoming disabled before they file disability claims with Social Security. I've wondered whether factors such as difficulty in contacting Social Security to file a claim and public perceptions about how easy or difficult it is to be approved for Social Security disability benefits affect how long people wait to file claims. Changes in the lag time between onset of disability and claim filing could affect the rate at which claims are filed. Unfortunately, the article doesn't give information to show how the lag time has changed over time but it does give some historic numbers. During the time period 2013-2014 the median gap time was 7.6 months. Don't ask me why they didn't use a more recent time period. Below is a chart from the article:

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     I would have been very interested to see whether this gap time was stable over time. What was it in 2010 compared to 2019? Unfortunately, the authors do not present such data.

     However, the authors do present data showing that the younger that disabled people are, the longer they wait to file disability claims:

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Endless WEP Problems

     From a recent report by Social Security's Office of Inspector General:

The Social Security Amendments of 1983 include a provision that eliminates “windfall” Social Security benefits for retired and disabled workers who are receiving pensions from employment not covered by Social Security.  

WEP [Windfall Elimination Provision] applies when the wage earner becomes entitled to both a pension based on non-covered employment and Social Security benefits. Under WEP, SSA uses a modified benefit formula to determine a wage earner’s monthly Social Security benefit. WEP applies to both retirement and disability benefits. However, under certain circumstances, a beneficiary’s payments are exempt from this provision. ...

Of 150 sampled beneficiaries, SSA improperly exempted 26 from WEP. Because of this processing error, the 26 beneficiaries were improperly paid approximately $774,000. Although the Agency was aware these 26 beneficiaries had received pensions, it did not reduce their benefits for WEP. Of these 26 beneficiaries, SSA may not correct the payments for 24 because of SSA’s administrative finality rules. Based on our sample results, we estimate SSA improperly paid approximately 3,600 beneficiaries $118 million. 

Additionally, SSA exempted 28 beneficiaries from WEP where we found the exemptions questionable. If SSA did not apply WEP, but should have, we estimate the Agency paid these 28 beneficiaries approximately $971,000 more than they were entitled to receive. 

Because of its administrative finality rules, SSA may not correct all the payment errors we identified. If it does not take corrective action, we estimate the Agency will improperly pay an additional $140 million in future payments to these beneficiaries.

     I'm not saying we should eliminate WEP but it's a mess to administer and claimants really, really dislike it.

Has The "Gig Economy" Had An Effect Upon The Number Of Disability Claims?

     From the abstract of How Does Contingent Work Affect SSDI Benefits?, a study by Matthew S. Rutledge, Alice Zulkarnain, and Sara Ellen King for the Center for Retirement Research at Boston College: 

Some studies have found that contingent workers – including independent contractors, consultants, and those in temporary, on-call, and “gig economy” jobs – make up an increasing share of the labor force. How does this group of workers interact with Social Security Disability Insurance (SSDI)? ...

The study finds that SSDI application rates are about one-quarter smaller for older eligible contingent workers than for traditional workers of the same ages. Contingent workers are also about one-third less likely to be awarded disability benefits. The lower application and award rates are likely due in part to contingent workers’ lower eligibility rates and lower potential benefits. The application and award rates are also lower for contingent workers who have a chronic condition, work limitation, or limitation in their Activities of Daily Living. These results suggest that contingent workers would benefit from a greater availability of information and assistance in navigating the SSDI application process.

     The study talks about the "gig economy" allowing people to work only they feel like it. That can allow individuals with health problems to continue at least some employment. I've seen an increase in the number of claimants who work in short term, on call and part time jobs enough to cause problems with their Social Security disability claims but not enough to support themselves.

What's Age Got To Do With It? A Lot

From the Center on Budget and Policy Priorities

Man Arrested For Threatening To Shoot Up Field Office

     George Elden Robinson was arrested in Phoenix after allegedly threatening to shoot up a Social Security field office on July 11.

Report On Decline In Disability Claims

     Social Security's Office of Retirement and Disability Policy has published a briefing paper dealing with the question of why the number of disability claims approved has gone down so much. It doesn't come to any definite conclusions.

    The main problem I have with this otherwise thorough report is that it mostly limits the data presented to 2017 and earlier. Since then the number of disability claims filed has continued to go down dramatically while the unemployment rate has held pretty much steady. That's hard to explain if your theory is that number of disability claims has declined due to reduced unemployment. I think this is the main issue that needs to be examined and this report seems to skirt around it.
     I believe that more research is needed on the connection between the quality or lack of quality of service at Social Security and the number of disability claims filed. As this report indicates, many who might file claims are ambivalent about doing so. This ambivalence makes them easily deterred by difficulty in filing a claim. We have some research on this subject but not much.
     By the way, if you think that the Office of Retirement and Disability Policy must issue many briefing papers like this, you're wrong. It's August and this one is labeled "Briefing Paper No. 2019-01." What exactly do they do in that Office?