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Hatch Comments on SSDI

Thursday, August 6, 2015   (1 Comments)
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Senate Finance Committee Chairman Orrin Hatch (R-UT) recently introduced three bills relating to SSDI.  Following are his remarks in introducing the bills, in which he addresses the impending depletion of the DI Trust Fund. 

By Mr. HATCH (for himself, Mr. Coats, Mr. Lankford, and Mr. Blunt):

S. 1922. A bill to amend titles II and XVI of the Social Security Act to provide for quality reviews of benefit decisions, and for other purposes; to the Committee on Finance.

Mr. HATCH. Mr. President, I rise to speak once again on the Social Security Disability Insurance—or DI—Program. As everyone in this Chamber should know, the DI trust fund is projected to be exhausted next year. That means, absent any change in law, we will be seeing across-the-board benefit cuts of close to 20 percent for DI beneficiaries. Over the last several months, I have come to the floor on a handful of occasions to talk about this program and the imminent depreciation of its trust fund.

I have called on my colleagues on both sides of the aisle to work with me to address these issues. I will repeat that call today.

In addition, today I have introduced three separate bills that are designed to help update and improve the administration of the DI program. As we talk about solutions to address the depletion of the DI trust fund, we should also be talking about ways to update the DI program, ways to make it easier for beneficiaries who can and who desire to return to work to be able to explore those opportunities and ways to improve efforts to deter and prevent waste and fraud.

The first bill I introduced today would update and expand the Social Security Administration’s tools to deter and punish fraudsters who cheat the system. The second bill would authorize the Commissioner of SSA to provide denied DI applicants with information about employment support services that are provided by both public agencies and private nonprofit organizations.

That information will help denied applicants find opportunities to reenter the workforce, instead of continually cycling through the DI application process. The third bill would require SSA to review hearing decisions by administrative law judges to ensure that they are following the law as well as Social Security regulations and policy. All three of these bills are designed to improve the administration of this disability program and make it work better for beneficiaries and taxpayers. They will not, by themselves, solve all of the program’s fiscal problems, but they will improve the DI system.

More work will need to go into this effort, and as chairman of the committee with jurisdiction over the DI program, I am committed to solving these problems and preventing the massive benefit cuts we will see under current law. I would like to point out three things about my stated approach to dealing with the DI program.

First, you will note I have not used the word “crisis” to describe what is happening with the DI trust fund. Second, you would be hard-pressed to find any proposal I have submitted that could credibly be characterized as “slashing” DI benefits. Third, nothing I have put forward either today or in the past could conceivably be thought of as “privatizing” disability insurance.

I have to point this out because a number of people, including some of my friends on the other side of the aisle, have described the Republican efforts to address the DI trust fund depletion using some of those very same words.

These individuals are currently more interested in turning this issue and the coming benefit cuts into a political football than in actually solving the problem. My question is, What good will that do for the DI program or its beneficiaries? It is not just the DI program that has problems. Social Security, in general, faces a number of significant fiscal and policy challenges.

In their most recent report, the Social Security board of trustees, which includes several members of President Obama’s Cabinet, recommended “that lawmakers address the projected trust fund shortfalls in a timely way in order to phase in necessary changes gradually and give workers and beneficiaries time to adjust to them.”

That says to me the sooner we act to put Social Security on a sustainable fiscal path the better it is for Americans and their security. It clearly does not mean we should ignore the financial problems facing Social Security or kick the can down the road, hoping some future Congress will get its act together and solve the problems.

Of course, providing financial sustainability to Social Security is easier said than done. There are reasonable disagreements over how best to address Social Security’s fiscal shortfalls, including different views on payroll tax revenues that fund the program and how quickly promised benefits will grow in the future. Yet we should not limit the discussion to taxes and outlays.

We also should look at how the program can be improved and brought up-to-date. For example, the vocational grids and medical guidelines that SSA uses in the disability program are woefully out of date, and much of the existing structure of Social Security’s retirement program was developed long ago, when labor markets and work patterns were much different than they are today.

We should be working to address all of these challenges, both the fiscal and policy challenges now, instead of putting them off for later days. With respect to the DI program in particular, I have been working for some time now to obtain input from experts and stakeholders across the spectrum to figure out how we can make the program work better. Joined by House Ways and Means Committee Chairman Ryan and Social Security Subcommittee Chairman Johnson, I have solicited input from stakeholders in various venues and continue to welcome ideas or proposals from anyone who wants to submit them.

The bills I have dropped today are just the latest in a series of bills I have introduced to help jump-start the discussion of DI reforms. We should not sit idly by and wait for another financing cliff to appear around the end of next year. As the Social Security trustees made clear, the sooner Congress acts to address these shortcomings, the better. Neither DI beneficiaries nor taxpayers benefit from lingering uncertainty about how the impending trust fund depletion will be resolved.

As I have said many times, I am ready and willing to have this conversation. Sadly, up to now, I have heard nothing in response from the Obama administration and very little from my colleagues on the other side of the aisle. Anyone familiar with the current state of the DI trust fund would likely acknowledge that we are going to have to reallocate resources into the fund if we are going to prevent the impending benefit cuts from happening next year.

Most proposals I have seen, including those from the President’s budget, involve a shuffling of money from Social Security’s retirement fund to the DI trust fund, but even if we have to reallocate resources to shore up the DI program, we should not delay confronting the obvious need for reform. On this point, I will once again quote the most recent report from the Social Security trustees, which says, “Reallocation of resources in the absence of substantive relief might serve to delay DI reforms and much-needed corrections for Social Security as a whole.”

It is true that as many of my colleagues have noted, there have been bipartisan agreements to reallocate resources within Social Security in the past. However, in virtually every case, the reallocations were accompanied by substantive policy changes. This time should be no different. The last time we reallocated resources from the retirement to the DI trust fund, DI awards were increasing unexpectedly and Congress needed to examine the reasons for this increase before acting to change the way the DI system worked.

At the time, most people agreed that reforms were necessary and that the reallocation would buy the time Congress needed to come up with those reforms, get them enacted, and put the trust fund on sound fiscal footing. That was more than 20 years ago. Sadly, though not surprisingly, Congress did not follow through with the reforms, and we now face another reserve depletion in the trust fund.

Needless to say, doubling down on the same strategy, a strategy that has already failed to produce the needed policy changes, is not a prudent course of action. In my view, any resource reallocation that gets enacted must be accompanied by changes in the DI program. However, the President does not seem to share this view. The administration has called for a stand-alone reallocation of payroll tax receipts away from the retirement and survivor’s trust fund and into the DI trust fund.

This proposal would, depending on the estimate, extend the life of the DI program to the early 2030s, at which point both Social Security trust funds, disability and retirement, will be exhausted at the same time, triggering massive benefit cuts for all beneficiaries. In fact, there are those who would argue that the Social Security retirement fund is already exhausted and deeply in debt.

That is their idea of a responsible approach to a widely acknowledged fiscal problem. Outside of the stand-alone reallocation scheme, the President’s budget offers precious little in the way of reforms to the DI program or Social Security in general. In other words, the Obama administration’s entire answer to all of Social Security’s many fiscal problems is literally to just let future Congress’s and administrations deal with those problems.

This, to me, would be the height of irresponsibility. While it may not be possible, absent some kind of resource allocation, to keep the DI program’s current promises between now and the end of the year, we can and should take meaningful steps now to improve the program. That is my goal. I hope enough of my colleagues share this goal to make it a reality.

If we are going to get there, it is going to require bipartisan cooperation on both ends of Pennsylvania Avenue. In other words, we are going to need to see more from the administration than we have seen thus far. It is already August. Despite my repeated requests to the administration and my friends on the other side of the aisle to engage with me to work on this issue, I have yet to hear a meaningful response. I hope that will change.

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There is no harm in discussing options. I am willing to discuss any and all options to fix these problems. There is, on the other hand, a great deal of potential harm to DI beneficiaries if we continue to ignore the problem while waiting for a financial cliff to force people’s hands. Once again, I urge my friends on both sides of the aisle to engage on this issue now, and do not wait until it is too late to take meaningful action.


D'Marie Barnes says...
Posted Thursday, August 20, 2015
Re. any review of decisions made in DI cases: Reviews /audits should be just as dedicated and aggressive to prevent inappropriate denials as inappropriate allowances. The hearing backlogs is getting much more extreme every month. That must stop. It is commonly taking 3 months or more for claimants to receive retroactive payments. That is usually because of a series of errors. Therefore the initial payment process should be reviewed and reformed as well as the decision-making process. Representatives are now required to do far more work per case, run a higher risk of no payment at all, and go without pay for longer periods. Plus the work just to get payments made is increasing. Therefore the ceiling on representative fees should be increased considerably. Congress and SSA should recognize a great service to the organization by representatives. We do much of the agency's work in the process of case development.

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