OIG Report On Repeated Overpayments

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

We found 70 (61 percent) of the Old-Age, Survivors and Disability Insurance (OASDI) beneficiaries and 59 (53 percent) of the Supplemental Security Income (SSI) recipients in our sample [of claimants who already had a history of three or more earnings related overpayments] were repeatedly overpaid because of their earnings. We believe SSA could have found these 129 individuals at fault for causing or contributing to the overpayments because of their repeated failure to comply with Agency earnings reporting requirements. SSA also could have further developed these cases to determine whether punitive actions could have been used as a deterrent against future overpayments. However, we found the Agency did not apply these actions to any of the individuals in our sample. 

Based on our sample, we project SSA overpaid 

• 49,420 OASDI beneficiaries almost $966 million and 
• 94,480 SSI recipients almost $924 million. 

As of February 2016, we estimate SSA had not collected almost $178 million of these OASDI overpayments and more than $447 million of these SSI overpayments.

     Social Security had identified these overpayments and has had some success in collecting them. What more does OIG want? They say they want people punished. There are provisions in the Social Security Act that allow punishment. I've noticed that OIG really likes to recommend that others use those provisions to punish people. However, when OIG has the opportunity to punish people itself, they don't seem to me to be quite so bloodthirsty. It's real people and things get messy. The overpayments are often small, the claimants not too bright and the fault not so clear. Punishment seems like overkill.
     By the way, note that 39% of the overpayments to Title II recipients and 47% to SSI recipients weren't the fault of the claimant. Let that sink in. The claimants were reporting earnings and Social Security didn't do what it was supposed to do a lot of the time. You also have to wonder how many of the cases where OIG wants to punish claimants are cases where the claimant reported the earnings but Social Security never kept a record of them reporting earnings. That happens. If you just look at computer records, it looks like the claimants were bad actors but when you start talking to the claimants, it's not so clear. This is just one of the reasons why Social Security isn't all that interested in imposing punishments.
     But, hey, this kind of report pleases Congressional Republicans and that's what it's all about. Right?

Chevron In Danger?

     From TPM:

… Yesterday, the House of Representatives passed a bill that could cripple the ability of government to regulate private industry.  

The bill modifies the Administrative Procedure Act … 

The Supreme Court ruled in 1984 that the courts could only overturn rulings that were “arbitrary and capricious, an abuse of discretion.” In other words, the courts would have to defer to the regulatory agencies in finding whether a ruling was justified. But the Republicans in the House passed a law that would allow the courts to rule without giving deference to the regulatory agencies. A Republican court could, for instance, overrule decisions of the Food and Drug Administration or the Environmental Protection Agency on concocted Constitutional grounds – say, by arguing that it violated the “takings” clause of the Constitution. That could cripple the regulatory agencies. ...

     Apparently, this would end the Chevron deference. How could this affect Social Security? It would make it far easier to challenge the agency's interpretation of the statutes. Any change in the APA is hugely important.

Interesting Question

     I've been doing Social Security work since 1978 so it's not often I get a question that I haven't heard before but here's a new one on me. Let me explain some background first. There's a 24 month waiting period for Medicare after Social Security Disability Insurance Benefits begin and that waiting period only begins after the five month waiting period for cash benefits to start. Yes, it's brutal. As long as the waiting periods are, many cases are delayed long enough that the claimant is entitled to back Medicare benefits. To get Medicare Part B, the part that pays for outpatient medical treatment, you have to pay monthly premiums. What happens in cases with retroactive Medicare entitlement is that the Medicare Part B doesn't go back unless you pay the back premiums. The question is can you take the retroactive Part B for only part of the time period for which you're eligible for it? This claimant's case had gone on for a very long time. The period of retroactive Medicare entitlement is about 30 months. The claimant had health care insurance until about nine months ago. She feels she won't get much value out of retroactive Medicare Part B until her health care insurance ended so she only wants the retroactive Medicare Part B for the last nine months instead of the entire 30 month time period. The difference in retroactive Part B premiums is over $2,000 so this isn't an academic question. Does anyone have experience with this question?

Social Security Headcount Goes Down

The Office of Personnel Management (OPM) has posted updated figures for the number of employees at the Social Security Administration:

• September 2016 64,394 
• December 2015 65,518
• September 2015 65,717
• June 2015 65,666
• March 2015 64,432
• December 2014 65,430
• September 2014 64,684
• June 2014 62,651
• March 2014 60,820
• December 2013 61,957
• September 2013 62,543
• June 2013 62,877
• March 2013 63,777
• December 2012 64,538
• September 2012 65,113
• September 2011 67,136
• December 2010 70,270
• December 2009 67,486
• September 2009 67,632
• December 2008 63,733
• September 2008 63,990

Paper Statements Will Go To Few People

     From Social Security's own blog:

We made some difficult decisions because of these latest budget limits. During the past year, we began a hiring freeze that will reduce our staff to the lowest level since FY 2013. We use a lot less overtime now, which affects our ability to reduce critical backlogs. Over a million people are waiting for a hearing to see if they are eligible for disability benefits.

Today, we are taking another cost-saving step. We will mail fewer paper Social Security Statements. Paper Statements will only be sent to people age 60 and over, who are not getting benefits and don’t have a my Social Security account. This will bring down the costs of processing and mailing paper Statements by $11.3 million in FY 2017.

     This change is already drawing attention from Michael Hiltzik at the L.A. Times,  Phillip Moeller at PBS and Mary Beth Franklin at Investment News.

Number Drawing Disability Benefits Declines 1.13% In 2016

     The final numbers for calendar year 2016 are in. By the end of 2016 there were 1.13% fewer people receiving Social Security disability benefits than at the end of 2015. That's 100,694 people. This is happening at a time when the aging of the baby boom generation should still be causing increasing numbers of people receiving disability benefits.
     There are three main reasons this is happening. It's harder to get approved for disability benefits. It takes longer to get approved. Because it's harder to get approved and because it takes longer, many people are discouraged from filing claims in the first place.

Proposed Rules On Attorney Regulation Withdrawn

     The Social Security Administration has withdrawn its set of proposed final regulations on Revisions to Rules of Conduct and Standards of Responsibility for Appointed Representatives from review by the Office of Management and Budget. This does not mean that this proposal is dead. It can be resubmitted by Social Security after the change of administration, with or without change.

Attorney Fees Hold Steady

     Social Security has posted its final numbers on fees paid to attorneys and others for representing Social Security claimants in 2016. The total was $1.093 billion, down only slightly from $1.094 billion in 2015. Fees are down $336 million, or 23%, from the peak in 2010.

     All attorneys who practice Social Security law face considerable economic pressure. The attorney fee provisions of the Social Security Act were designed to allow claimants to have representation. This right could be effectively eliminated over coming years unless something changes. One important way that the Acting Commissioner of Social Security could assure that claimants don't lose their right to representation is to increase the cap on Social Security attorney fees. It's currently $6,000. The Social Security Act allows the Acting Commissioner to raise this to adjust for inflation but does not require that she do so. If adjusted for inflation, the cap would now be over $7,000. It's past time to raise the cap.

     Every time I write about attorney fees, I get the response from some Social Security employees that attorneys who represent claimants are lazy, that they do nothing for the money they're paid. Those who would post this need to ask themselves the question "If representing Social Security claimants is such easy money, why don't I leave my job with the agency and jump on this gravy train?" After all, who goes to law school with the intention of never representing a real live client? Get out there and show the world how it should be done!

     Social Security employs thousands of attorneys but hardly a one of them has left Social Security to represent Social Security claimants in recent years. What does that tell you?

     And by the way, when I post about attorney fees I usually get responses from some Administrative Law Judges that go something like "When I was in private practice, I spent hundreds of hours doing depositions and meeting with my client and other witnesses in each individual case. Social Security attorneys don't do anything like that so they're worthless." Those who post this tend to forget that they or their firms were being paid tens if not hundreds of thousands of dollars a case. You try spending hundreds of hours on each Social Security case when the total possible fee is no more than $6,000 and see how long you last. The challenge in representing Social Security claimants is doing a professional job when economics require you to represent lots of clients. Give it a try and find out for yourself just how easy that is.