Social Security’s Immigration Problem

      From the Motley Fool:

… Look at social media message boards, and you'll find one commonly repeated viewpoint: That undocumented workers receiving benefits are to blame for Social Security's financial shortcomings. Immigration into the U.S., in general, seems to be a regular scapegoat for why America's top retirement program is struggling.

But this school of thought couldn't be more wrong.

Social Security's problem isn't that too many immigrants are flocking to the United States. Rather, it's that net-legal immigration has been declining for a quarter of a century. Since 1998, the net migration rate into the U.S. has fallen every single year, and is down by an aggregate of 57%, according to data from the United Nations. 

Most people legally migrating to the U.S. tend to be younger, which is an extremely important point. These are people who will spend decades in the labor force contributing to Social Security via the payroll tax. The 12.4% payroll tax on earned income (wages and salary) was responsible for providing approximately $981 billion (90.1%) of the $1.088 trillion in revenue Social Security collected in 2021. 

The intermediate-cost model in the 2022 Trustees Report -- the "intermediate-cost model" is what the Trustees view as the outcome likeliest to happen -- is based on average annual total net immigration of 1,246,000 people.  Between July 1, 2012, and June 30, 2017, fewer than 955,000 total net migrants entered the U.S. annually, according to data from the World Bank.  If net migration into the U.S. continues to fall, or even steadies at these reduced levels, it's all but a certainty that Social Security's funding shortfall will grow. …

Now How About A Commissioner Nomination?

     The President has nominated Kathryn Lang to became a member of the Social Security Advisory Board. Lang is Director of Federal Income Security at Justice in Aging, a national non-profit legal organization that fights against senior poverty. She has worked with Social Security and SSI issues.

Disability Backlogs Are Cruel

     From the Milwaukee Journal Sentinel (paywall):

A hospital social worker helped Nicholas Johnson fill out dozens of pages of paperwork for Social Security Disability Insurance in September after he woke up from a coma and realized he was paralyzed. ...

Johnson missed two phone calls from the Social Security office while he was in physical therapy. He started the application process over, for a third time, in early January. 

With no income, Johnson can’t pay rent, so he moved in with his grandmother. But her home is too small to accommodate his wheelchair, so family members come over daily to carry him from room to room. ...

Johnson is one of more than 2,000 people in Milwaukee waiting for the Social Security Administration's approval to receive disability benefits, according to the latest data available from the agency. The average wait time is 368 days, leaving many people struggling without adequate housing or money to pay for their basic needs for more than a year. ...

Hope Lloyd is a community living and home supervisor with Independence First who is working with about a dozen people in Milwaukee with spinal cord injuries who haven't been able to get their first disability checks, so they are living in nursing homes or with family. 

"It's not where they belong, but without those expedited payments, they can’t  apply for an apartment because they don't have any income," Lloyd said. "A lot of times, they're the primary breadwinner, so it's just really, really bad." ...

At the state level, the Wisconsin Department of Health Services said a mandated federal update to its computer system in late 2019 further pushed wait times. 

"Wisconsin’s legacy system was superior to the current (federal) system because it included more automatic prompts for examiners that made it easier for them to manage their very high caseloads," said Jennifer Miller, a spokeswoman with DHS. 

Miller said examiners receive specialized training that takes more than two years to become fully proficient.  

"As a result of increased evidence, increased scrutiny, continuously growing case complexity, and a new nationwide case processing system rollout, case production has become more labor-intensive and slower," Miller said. "Adjudicators’ case counts have increased significantly, and the job has become untenable in many states. ...

I've Got News For The AARP: That $785 Million Appropriation Increase Is Less Than The Increase In Inflation So Don't Expect Improved Service

     From AARP:

We’re asking the Social Security Administration (SSA) to put customer service on the front burner now that Congress and the Biden administration have approved a $785 million budget increase for the agency.

AARP members sent Congress more than 200,000 emails last year urging it to approve more funding for customer service issues amid historically high wait times and a backlog in disability claims. The agency primarily blamed the delays on years of understaffing and insufficient funds. ...

We wrote to SSA Acting Commissioner Kilolo Kijakazi last week, urging her to make customer service a top priority in the operating plan the agency is required to submit to Congress next month as part of the recently approved 2023 spending bill. ...

GOP Wants To Cut Social Security

     From the Washington Post:

...  Only weeks after taking control of the chamber, GOP lawmakers under new Speaker Kevin McCarthy (R-Calif.) have rallied around firm pledges for austerity, insisting their efforts can improve the nation’s fiscal health. ...

So far, the party has focused its attention on slimming down federal health care, education, science and labor programs, perhaps by billions of dollars. But some Republicans also have pitched a deeper examination of entitlements, which account for much of the government’s annual spending — and reflect some of the greatest looming fiscal challenges facing the United States. ...

In recent days, a group of GOP lawmakers has called for the creation of special panels that might recommend changes to Social Security and Medicare, which face genuine solvency issues that could result in benefit cuts within the next decade. Others in the party have resurfaced more detailed plans to cut costs, including by raising the Social Security retirement age to 70, targeting younger Americans who have yet to obtain federal benefits ...

GOP lawmakers have been counseled by a wide array of right-leaning groups, including the Heritage Foundation, that the new majority should consider significant changes to entitlements as part of their commitment to cutting spending and balancing the budget — but not tax increases. ...

    "Special panel" to recommend Social Security cuts. Is that like a death panel? 

    Republicans are living in a fantasy world if they really think they can cut Social Security. Forget the Senate and the White House. They couldn't come close to passing Social Security cuts in the House of Representatives. Get real.

Trust Funds Report

     Social Security's actuaries have released final trust fund numbers for calendar year 2022. The Disability Trust Fund entered the year with $99 billion on hand and ended the year with $118 billion. The Retirement Trust Fund entered the year with $2.76 trillion and ended the year with $2.71 trillion on hand. Combined, the two Trust Funds entered the year with $2.85 trillion dollars and ended the year with $2.83 trillion.

Time To Loosen Up?

     There are a lot of acrylic shields in place in Social Security hearing rooms. They're a pain in the neck for those participating in hearings in person. It can be hard to hear. I believe there are also a lot of acrylic shields in Social Security field offices. Is it time for them to go? Are they still needed?

Attorneys Representing Social Security Claimants Are Hurting

     Social Security has posted final numbers showing total fees paid to attorneys and others for representing claimants in 2022. Let's do a comparison with the last three years:

• 2019: 390,809 fees were paid for a total of $1,214,557,861. Average fee per case was $3,107.80
  
• 2020: 360,493 fees were paid, down 8% from 2019. The total fees paid were $1,081,523,523, down 11% from 2019. Average fee per case was $3,000.12.
  
• 2021: 296,847 fees were paid, down 18% from 2020 and down 24% from 2019. The total fees paid were $932,887,938, down 14% from 2020 and down 23% from 2020. Average fee per case was $3,142.66.
  
• 2022: 311,047 fees were paid, up 5% from 2021 but down 14% from 2020 and down 20% from 2019. The total fees paid were $923,992,941, down 1% from 2021, down 15% from 2020 and down 24% from 2019. The average fee per case was $2,970.59.
  

    Social Security attorneys are genuinely hurting. The recent increase in the fee cap is only going to help so much, especially when you consider that the attorneys have to cope with huge inflation and case files that have been getting bigger and bigger because of electronic medical records. The end result is that the quality of representation of claimants has been going down.

    Social Security depends upon claimants being represented. Take us out of the picture and workloads at Social Security become far worse.